Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 02, 2017 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | XRM | |
Entity Registrant Name | XERIUM TECHNOLOGIES INC | |
Entity Central Index Key | 1,287,151 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding (in shares) | 16,167,949 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 10,138 | $ 12,808 |
Accounts receivable, net | 74,666 | 68,667 |
Inventories, net | 73,997 | 70,822 |
Prepaid expenses | 5,658 | 6,325 |
Other current assets | 17,733 | 15,784 |
Total current assets | 182,192 | 174,406 |
Property and equipment, net | 288,009 | 284,101 |
Goodwill | 58,064 | 56,783 |
Intangible assets | 7,694 | 7,330 |
Non-current deferred tax asset | 12,810 | 10,737 |
Other assets | 8,350 | 8,556 |
Total assets | 557,119 | 541,913 |
Current liabilities: | ||
Notes payable | 7,596 | 7,328 |
Accounts payable | 42,261 | 36,158 |
Accrued expenses | 52,549 | 64,532 |
Current maturities of long-term debt | 9,403 | 8,600 |
Total current liabilities | 111,809 | 116,618 |
Long-term debt, net of current maturities | 483,981 | 472,923 |
Liabilities under capital leases | 18,216 | 19,236 |
Non-current deferred tax liability | 8,442 | 7,157 |
Pension, other post-retirement and post-employment obligations | 65,183 | 65,026 |
Other long-term liabilities | 9,056 | 7,858 |
Commitments and contingencies | ||
Stockholders’ deficit | ||
Preferred stock, $0.001 par value, 1,000,000 shares authorized; no shares outstanding as of March 31, 2017 and December 31, 2016 | 0 | 0 |
Common stock, $0.001 par value, 20,000,000 shares authorized; 16,167,949 and 16,152,946 shares outstanding as of March 31, 2017 and December 31, 2016, respectively | 16 | 16 |
Paid-in capital | 431,354 | 430,823 |
Accumulated deficit | (445,900) | (443,066) |
Accumulated other comprehensive loss | (125,038) | (134,678) |
Total stockholders’ deficit | (139,568) | (146,905) |
Total liabilities and stockholders’ deficit | $ 557,119 | $ 541,913 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Common stock, shares outstanding (in shares) | 16,167,949 | 16,152,946 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement [Abstract] | ||
Net Sales | $ 119,866 | $ 114,965 |
Costs and expenses: | ||
Cost of products sold | 72,370 | 71,428 |
Selling | 15,674 | 15,721 |
General and administrative | 12,654 | 11,507 |
Research and development | 1,744 | 1,940 |
Restructuring | 3,164 | 2,832 |
Costs and expenses | 105,606 | 103,428 |
Income from operations | 14,260 | 11,537 |
Interest expense, net | (13,263) | (10,341) |
Loss on extinguishment of debt | (25) | 0 |
Foreign exchange (loss) gain | (1,125) | 24 |
(Loss) income before provision for income taxes | (153) | 1,220 |
Provision for income taxes | (2,681) | (2,665) |
Net loss | (2,834) | (1,445) |
Comprehensive income | $ 6,806 | $ 7,373 |
Net loss per share: | ||
Basic (in dollars per share) | $ (0.18) | $ (0.09) |
Diluted (in dollars per share) | $ (0.18) | $ (0.09) |
Shares used in computing net loss per share: | ||
Basic (in shares) | 16,153,113 | 15,789,991 |
Diluted (in shares) | 16,153,113 | 15,789,991 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Operating activities | ||
Net loss | $ (2,834) | $ (1,445) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Stock-based compensation | 531 | 592 |
Depreciation | 7,819 | 7,900 |
Amortization of intangible assets | 273 | 94 |
Deferred financing cost amortization | 899 | 756 |
Foreign exchange loss on revaluation of debt | 627 | 1,120 |
Deferred taxes | 10 | 155 |
(Gain) loss on disposition of property and equipment | (49) | 17 |
Loss on extinguishment of debt | 25 | 0 |
Provision (benefit) for doubtful accounts | 41 | (72) |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | (4,153) | (2,130) |
Inventories | (1,136) | 2,232 |
Prepaid expenses | 783 | (621) |
Other current assets | (1,785) | 1,024 |
Accounts payable and accrued expenses | (7,334) | 4,689 |
Deferred and other long-term liabilities | (940) | 792 |
Net cash (used in) provided by operating activities | (7,223) | 15,103 |
Investing activities | ||
Capital expenditures | (5,285) | (3,550) |
Proceeds from disposals of property and equipment | 216 | 20 |
Net cash used in investing activities | (5,069) | (3,530) |
Financing activities | ||
Proceeds from borrowings | 40,476 | 13,313 |
Principal payments on debt | (29,693) | (16,439) |
Payment of financing fees | (170) | (98) |
Payment of obligations under capital leases | (1,520) | (673) |
Employee taxes paid on equity awards | 0 | (1,029) |
Net cash provided by (used in) financing activities | 9,093 | (4,926) |
Effect of exchange rate changes on cash flows | 529 | (1,036) |
Net (decrease) increase in cash | (2,670) | 5,611 |
Cash and cash equivalents at beginning of period | 12,808 | 9,839 |
Cash and cash equivalents at end of period | 10,138 | 15,450 |
Noncash capitalized lease asset and liability | $ 0 | $ 1,259 |
Description of Business and Sig
Description of Business and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Significant Accounting Policies | Description of Business and Significant Accounting Policies Description of Business Xerium Technologies, Inc. (the "Company") is a leading, global provider of industrial consumable products and services including machine clothing, roll coverings, roll repair and mechanical services. These goods and services are used in the production of paper, paperboard, building products and nonwoven materials. Its operations are strategically located in the major paper-making regions of the world, including North America, Europe, Latin America and Asia-Pacific. Basis of Presentation The accompanying unaudited condensed consolidated interim financial statements at March 31, 2017 and for the three months ended March 31, 2017 and 2016 include the accounts of the Company and its wholly-owned subsidiaries and have been prepared in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) for interim financial reporting and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Accordingly, such financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. GAAP requires the Company’s management to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results could differ from those estimates. The interim results presented herein are not necessarily indicative of the results to be expected for the entire year. In management’s opinion, these unaudited condensed consolidated interim financial statements contain all adjustments of a normal recurring nature necessary for a fair presentation of the financial statements for the interim periods presented. These unaudited condensed consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2016 as reported on the Company's Annual Report on Form 10-K filed on March 1, 2017. Accounting Policies Inventories, net Inventories are generally valued at the lower of cost or market using the first-in, first-out (FIFO) method. Raw materials are valued principally on a weighted average cost basis. The Company’s work in process and finished goods are specifically identified and valued based on actual inputs to production. Provisions are recorded as appropriate to write-down obsolete and excess inventory to estimated net realizable value. The process for evaluating obsolete and excess inventory often requires management to make subjective judgments and estimates concerning future sales levels, quantities and prices at which such inventory will be able to be sold in the normal course of business, while considering the general aging of inventory and factoring in any new business conditions. The components of inventories are as follows at: March 31, 2017 December 31, 2016 Raw materials $ 14,706 $ 14,089 Work in process 27,205 25,879 Finished goods (includes consigned inventory of $6,985 at March 31, 2017 and $6,673 at December 31, 2016) 38,866 37,155 Inventory allowances (6,780 ) (6,301 ) $ 73,997 $ 70,822 Goodwill The Company accounts for goodwill and other intangible assets in accordance with ASC Topic 350, Intangibles—Goodwill and Other Intangible Assets (“Topic 350”). Topic 350 requires that goodwill and intangible assets that have indefinite lives not be amortized, but instead, must be tested for impairment at least annually or whenever events or business conditions warrant. During the three months ended March 31, 2017 , the Company evaluated events and business conditions to determine if a test for an impairment of goodwill was warranted. No such events or business conditions took place during this period, therefore no test was determined to be warranted at March 31, 2017 . Warranties The Company offers warranties on certain roll products that it sells. The specific terms and conditions of these warranties vary depending on the product sold, the country in which the product is sold and arrangements with the customer. The Company estimates the costs that may be incurred under its warranties and records a liability in Accrued Expenses on its Consolidated Balance Sheet for such costs. Factors that affect the Company’s warranty liability include the number of units sold, historical and anticipated rates of warranty claims, cost per claim and new product introduction. The Company periodically assesses the adequacy of its recorded warranty claims and adjusts the amounts as necessary. The table below represents the changes in the Company’s warranty liability for the three months ended March 31, 2017 and 2016 : Beginning Balance Charged to Cost of Sales Effect of Foreign Currency Translation Deduction from Reserves Ending Balance Three Months Ended March 31, 2017: $ 2,203 $ 235 $ 30 $ (179 ) $ 2,289 Three Months Ended March 31, 2016: $ 2,175 $ 477 $ 34 $ (189 ) $ 2,497 Net Loss Per Common Share Net loss per common share has been computed and presented pursuant to the provisions of ASC Topic 260, Earnings per Share (“Topic 260”). Net loss per share is based on the weighted-average number of shares outstanding during the period. As of March 31, 2017 and 2016 , the Company had outstanding restricted stock units (“RSUs”), deferred stock units (“DSUs”) and options. The following table sets forth the computation of basic and diluted weighted-average shares: Three Months Ended March 31, 2017 2016 Weighted-average common shares outstanding–basic 16,153,113 15,789,991 Dilutive effect of stock-based compensation awards outstanding — — Weighted-average common shares outstanding–diluted 16,153,113 15,789,991 The following table sets forth the aggregate of the potentially dilutive securities that were outstanding in the three months ended March 31, 2017 and 2016 , but were not included in the computation of diluted earnings per share because the impact would have been anti-dilutive: Three Months Ended March 31, 2017 2016 Anti-dilutive securities 902,988 738,294 Impairment The Company reviews its long-lived assets that have finite lives for impairment in accordance with ASC Topic 360, Property, Plant, and Equipment (“Topic 360”). This topic requires that companies evaluate the fair value of long-lived assets based on the anticipated undiscounted future cash flows to be generated by the assets when indicators of impairment exist to determine if there is impairment to the carrying value. Any change in the carrying amount of an asset as a result of the Company's evaluation has been recorded in either restructuring expense, if it was a result of the Company's restructuring activities, or general and administrative expense for all other impairments in the consolidated statements of operations. For the three months ended March 31, 2017 and 2016 , the Company had no impairment charges included in restructuring expense. New Accounting Pronouncements In March 2017, the FASB issued Accounting Standards Update No 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost ("ASU 2017-07"). ASU 2017-07 will change how employers that sponsor defined benefit pension and/or other post-retirement benefit plans present the net periodic benefit cost in the income statement. Employers will present the service cost component of net periodic benefit cost in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period. Only the service cost component will be eligible for capitalization in assets. Employers will present the other components of the net periodic benefit cost separately from the line item(s) that includes the service cost and outside of any subtotal of operating income, if one is presented. These components will not be eligible for capitalization in assets. The guidance is effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods therein. Early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. The guidance provides a practical expedient for disaggregating the service cost component and other components for comparative periods. The Company is in the process of evaluating this accounting standard update. In January 2017, the FASB issued Accounting Standards Update No 2017-04, Intangibles—Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 simplifies the accounting for goodwill impairment for all entities by requiring impairment charges to be based on the first step in today’s two-step impairment test under Accounting Standards Codification (ASC) 350. The FASB issued new guidance that eliminates the requirement to calculate the implied fair value of goodwill (i.e., Step 2 of today’s goodwill impairment test) to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value (i.e., measure the charge based on today’s Step 1). The standard has tiered effective dates, starting in 2020 for calendar-year public business entities that meet the definition of an SEC filer. Early adoption is permitted for annual and interim goodwill impairment testing dates after January 1, 2017. The Company is in the process of evaluating this accounting standard update. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory ("ASU 2016-16"). ASU 2016-16 eliminates the exception to the principle in ASC 740, for all intra-entity sales of assets other than inventory, to be deferred, until the transferred asset is sold to a third party or otherwise recovered through use. This standard is effective for financial statements issued for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements. In August 2016, the FASB issued Accounting Standards Update No 2016-15, Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments ("ASU 2016-15"). ASU 2016-15 clarifies how entities should classify certain cash receipts and cash payments in the statement of cash flows and amends certain disclosure requirements of ASC 230. The guidance will generally be applied retrospectively and is effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those years. For all other entities, it is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. The Company is in the process of evaluating this accounting standard update. In March of 2016, t he FASB issued Accounting Standards Update No 2016-09 Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"). ASU 2016-09 will change certain aspects of accounting for share-based payments to employees. The new guidance will require all income tax effects of awards to be recognized in the income statement when the awards vest or are settled. It also will allow an employer to repurchase more of an employee’s shares than it can today for tax withholding purposes without triggering liability accounting and to make a policy election to account for forfeitures as they occur. ASU 2016-09 is required to be adopted in January of 2017. The Company early adopted this standard at June 30, 2016. As of March 31, 2017 , the adoption of the standard has resulted in the re-classification of $1.0 million of employee taxes paid on equity awards as a financing activity in the statement of cash flows, for the three months ended March 31, 2016 . The remaining provisions of ASU 2016-09 did not have a material impact on the accompanying condensed consolidated financial statements. In February of 2016, the FASB issued Accounting Standards Update No 2016-02 Leases ("ASU 2016-02"). ASU 2016-02 includes final guidance that requires lessees to put most leases on their balance sheets but recognize expenses in the income statement in a manner similar to today’s accounting. The guidance also eliminates today’s real estate-specific provisions and changes the guidance on sale-leaseback transactions, initial direct costs and lease executory costs for all entities. For lessors, the standard modifies the classification criteria and the accounting for sales-type and direct financing leases. All entities will classify leases to determine how to recognize lease-related revenue and expense. Classification will continue to affect amounts that lessors record on the balance sheet. Entities are required to use a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. They have the option to use certain relief. Full retrospective application is prohibited. ASU 2016-02 is effective for public companies with annual periods beginning after 15 December 2018, and interim periods within those years. For all other entities, it is effective for annual periods beginning after 15 December 2019, and interim periods the following year. Early adoption is permitted for all entities. The Company is in the process of evaluating this accounting standard update. In November of 2015, the FASB issued ASU 2015-17 Income Taxes (Topic 740), Balance Sheet Classification of Deferred Taxes ("ASU 2015-17"). This guidance requires companies to classify all deferred tax assets and liabilities as non-current on the balance sheet instead of separating deferred taxes into current and non-current amounts. For public companies, the guidance is effective for financial statements issued for annual periods beginning after 15 December 2016 (i.e., 2017 for a calendar-year company) and interim periods within those annual periods. Early adoption of the guidance is permitted. Companies can adopt the guidance either prospectively or retrospectively. The Company early adopted this standard at December 31, 2016, using the prospective method; prior periods were not retrospectively adjusted. The provisions of ASU 2015-17 did not have a material impact on the consolidated financial statements. In July of 2015, the FASB issued Accounting Standards Update Inventory ("ASU 2015-11"). ASU 2015-11 applies only to first-in, first-out (FIFO) and average cost inventory costing methods and will reduce costs and increase comparability for these methods. There will be no change for last-in, first-out, (LIFO) or retail inventory methods as the costs of transitioning to a new method would outweigh the benefits due to the complexity of these methods. Under this ASU, inventory should be measured at the lower of cost and net realizable value (selling prices in the ordinary course of business less reasonably predictable costs of completion, disposal, and transportation). When the net realizable value of inventory is less than its cost, the difference will be recognized as a loss in earnings in the period in which it occurs. This ASU more closely aligns the measurement of inventory under GAAP with International Financial Reporting Standards guidance. The amendments are effective for public companies for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years, and for other entities, the amendments are effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. The amendments should be applied prospectively, and early application is permitted as of the beginning of an interim or annual reporting period. The Company implemented this standard during the first quarter of 2016. The provisions of ASU 2015-11 did not have an impact to the financial statements. In May of 2014, the FASB issued Accounting Standard Update No. 2014-09 Revenue from Contracts with Customers ("ASU 2014-09"). ASU 2014-09 requires the use of a new five-step model to recognize revenue from customer contracts. The five-step model requires that the Company identify the contract with the customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract and recognize revenue when it satisfies the performance obligations. The Company will also be required to disclose information regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. ASU 2014-09 is required to be adopted in January of 2018. Retrospective application is required either to all periods presented or with the cumulative effect of initial adoption recognized in the period of adoption. The Company has commenced a comprehensive project plan to direct the implementation of the new revenue recognition standards and an assessment of the impact to business processes. The Company intends to adopt the new standard using the modified retrospective transition method effective January 1, 2018. |
Business Acquisitions
Business Acquisitions | 3 Months Ended |
Mar. 31, 2017 | |
Business Combinations [Abstract] | |
Business Acquisitions | Business Acquisitions On May 4, 2016, the Company acquired certain assets and liabilities of JJ Plank Corporation/Spencer Johnston (“Spencer Johnston”), a spreader roll company headquartered in Neenah, Wisconsin for an adjusted purchase price of $17.6 million . This acquisition expands the Company's current rolls product offerings, service capabilities and markets served, strengthens its financial profile and grows its customer base. The Company acquired all of the assets and assumed certain liabilities of Spencer Johnston. Because the transaction was completed on May 4, 2016, the final purchase price allocation at the acquisition date was subject to change with respect to closing date working capital balances and other post-closing adjustments. The measurement period remains open as of March 31, 2017 . The adjusted purchase price of $17.6 million resulted in net assets acquired other than goodwill of $15.7 million and goodwill of $1.9 million . All of the goodwill is allocated to the Rolls Covers business segment. Goodwill represents the excess purchase price over the fair values of assets acquired and liabilities assumed. The goodwill was generated by the synergies the transaction provides. |
Derivatives and Hedging
Derivatives and Hedging | 3 Months Ended |
Mar. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives and Hedging | Derivatives and Hedging Risk Management Objective of Using Derivatives The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. From time to time, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known cash amounts, the value of which are determined by interest rates or foreign exchange rates. Cash Flow Hedges of Interest Rate Risk From time to time, the Company uses interest rate derivatives to add stability to interest expense and to manage its exposure to interest rate movements. However, at March 31, 2017 , the Company had no interest rate derivatives. Non-designated Hedges of Foreign Exchange Risk Derivatives not designated as hedges are not speculative and are used to manage the Company’s exposure to foreign exchange rates, but do not meet the strict hedge accounting requirements of ASC Topic 815. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in earnings. The Company, from time to time, may enter into foreign exchange forward contracts to fix currencies at specified rates based on expected future cash flows to protect against the fluctuations in cash flows resulting from sales denominated in foreign currencies. Additionally, to manage its exposure to fluctuations in foreign currency on intercompany balances and certain purchase commitments, the Company from time to time may use foreign exchange forward contracts. As of March 31, 2017 and December 31, 2016 , the Company had outstanding derivatives that were not designated as hedges in qualifying hedging relationships. The value of these contracts is recognized at fair value based on market exchange forward rates and is recorded in other assets or other liabilities on the Consolidated Balance Sheets. The following represents the fair value of these derivatives at March 31, 2017 and December 31, 2016 and the change in fair value included in foreign exchange gain (loss) in the three months ended March 31, 2017 and 2016 : March 31, 2017 December 31, 2016 Fair value of derivative (liability) $ (79 ) $ (1,461 ) Three Months Ended March 31, 2017 Three Months Ended March 31, 2016 Change in fair value of derivative included in foreign exchange (loss) gain $ 145 $ 1,170 The following represents the notional amounts of foreign exchange forward contracts at March 31, 2017 : Notional Sold Notional Purchased Non-designated hedges of foreign exchange risk $ — $ (987 ) Fair Value of Derivatives Under ASC Topic 820 ASC Topic 820, Fair Value Measurements and Disclosures (“Topic 820”), emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, Topic 820 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs including fair value of investments that do not have the ability to redeem at net asset value as of the measurement date, or during the first quarter following the measurement date. The derivative assets or liabilities are typically based on an entity’s own assumptions, as there is little, if any, market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and the Company considers factors specific to the asset or liability. The Company determined that its derivative valuations, which are based on market exchange forward rates, fall within Level 2 of the fair value hierarchy. |
Long term Debt
Long term Debt | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long term Debt | Long term Debt At March 31, 2017 and December 31, 2016 , long term debt consisted of the following: March 31, 2017 December 31, 2016 Notes (Secured), payable semi-annually–U.S. Dollar denominated interest rate fixed at 9.50%. Sold at a price equal to 98.54% of their face value. Matures August of 2021. $ 480,000 $ 480,000 Notes payable, working capital loan, variable interest rate at 2.05%. Matures June 30, 2017, with one-year rollover option. 7,596 7,328 Fixed asset loan contract, variable interest rate of 5.78%. Matures June of 2020. 7,590 7,511 Other debt 21,593 10,448 Total debt (excluding long-term capital leases and deferred finance fees) 516,779 505,287 Less deferred financing costs and debt discount (15,799 ) (16,436 ) Less current maturities of long term debt and notes payable (16,999 ) (15,928 ) Total long term debt $ 483,981 $ 472,923 On August 9, 2016, the Company closed on $480 million aggregate principal amount of 9.5% Senior Secured Notes due August 2021 (the "Notes"), which were sold at a price equal to 98.54% of their face value. The Notes will pay interest semi-annually in arrears on February 15 and August 15 of each year beginning on February 15, 2017 and will mature on August 15, 2021, unless earlier redeemed or repurchased. The Company used the net proceeds from the offering to repay all amounts outstanding under its then existing term loan credit facility, to redeem all of its 8.875% Senior Notes due 2018 at a redemption price equal to 102.219% of the principal amount thereof, together with accrued and unpaid interest, to the date of redemption, to pay fees and expenses relating to these transactions, and for working capital and other general corporate purposes. As of March 31, 2017 , an aggregate of $25.3 million is available for additional borrowings under the $55.0 million Revolving Credit and Guaranty Agreement ("ABL Facility"). This availability represents $39.4 million under the ABL revolver that is currently collateralized by certain assets of the Company, less $14.1 million of that facility committed for letters of credit or additional borrowings. In addition, the Company had approximately $3.2 million available for borrowings under other small lines of credit. On May 17, 2013, the Company entered into a Credit and Guaranty Agreement for $200.0 million (increased to $230 million on August 18, 2016) term loan credit facility (the “Term Credit Facility”), net of a discount of $1.0 million , among the Company, certain direct and indirect U.S. subsidiaries of the Company as guarantors and certain financial institutions. This facility was repaid with proceeds from the 9.5% senior secured notes. On May 17, 2013, the Company also entered into a Revolving Credit and Guaranty Agreement originally for a $40.0 million asset-based revolving credit facility subject to a borrowing base among Xerium Technologies, Inc., as a US borrower, Xerium Canada Inc., as Canadian borrower, certain direct and indirect U.S. subsidiaries of the Company as guarantors and certain financial institutions (the "Domestic Revolver"). On March 3, 2014, the Company entered into an amendment to the Revolving Credit and Guaranty Agreement (as amended, the “old ABL Facility,” and collectively with the Term Credit Facility, the “Credit Facility”), increasing the aggregate availability under the old ABL Facility to $55 million . On November 3, 2015, the Company refinanced the old ABL Facility and entered into the ABL Facility with one of its existing ABL lenders. The amount of the ABL Facility continues to provide aggregate availability of $55 million and the collateral pledged thereunder has remained the same. The ABL Facility matures in November of 2020 and accrues interest at either an Alternative Base rate (Prime plus 75 bps) or Fixed LIBOR (LIBOR +175 bps). As of March 31, 2017 these rates were 4.75% and 2.78% , respectively. The Indenture and the ABL Facility contain certain customary covenants that, subject to exceptions, restrict our ability to, among other things: • declare dividends or redeem or repurchase equity interests; • prepay, redeem or purchase debt; • incur liens and engage in sale-leaseback transactions; • make loans and investments; • incur additional indebtedness; • amend or otherwise alter debt and other material agreements; • engage in mergers, acquisitions and asset sales; • transact with affiliates; and • engage in businesses that are not related to the Company's existing business. On July 17, 2015 (the "Closing Date"), Xerium China, Co., Ltd. ("Xerium China"), a wholly-owned subsidiary of the Company entered into and closed a Fixed Assets Loan Contract (the "Loan Agreement") with the Industrial and Commercial Bank of China Limited, Shanghai-Jingan Branch (the “Bank”) with respect to a RMB 58.5 million loan, which was approximately 9.4 million USD on July 17, 2015. The loan is secured by pledged machinery and equipment of Xerium China and guaranteed by Xerium Asia Pacific (Shanghai) Limited and Stowe Woodward (Changzhou) Roll Technologies Co. Ltd., which are wholly-owned subsidiaries of the Company, pursuant to guarantee agreements (the "Guarantee Agreements"). Interest on the outstanding principal balance of the loan accrues at a benchmark rate plus a margin. The current interest rate at March 31, 2017 is approximately 5.8% . The interest rate will be adjusted every 12 months during the term of the loan, based on the benchmark interest rate adjustment. Interest under the loan is payable quarterly in arrears. Principal on the loan is to be repaid in part every six months following the Closing Date, in accordance with a predetermined schedule set forth in the Loan Agreement. Proceeds of the Loan will be used by Xerium China to purchase production equipment. The Loan Agreement contains certain customary representations and warranties and provisions relating to events of default. On May 26, 2011, the Company completed a refinancing transaction, which replaced certain of its then outstanding indebtedness with $240 million aggregate principal amount of 8.875% senior unsecured notes. The notes were repaid with proceeds from the 9.5% Senior Secured Notes. As of March 31, 2017 , the carrying value of the Company’s long term debt was $499.8 million (excluding deferred financing costs) and its fair value was approximately $510.0 million . The Company determined the fair value of its debt utilizing significant other observable inputs (Level 2 of the fair value hierarchy). Long-term Capitalized Lease Liabilities As of March 31, 2017 , the Company had long-term capitalized lease liabilities totaling $18.2 million . These amounts represent the lease on the corporate headquarters and the Kunshan, China facility, as well as other leases for software, vehicles and machinery and equipment. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company utilizes the liability method for accounting for income taxes in accordance with ASC Topic 740 , Income Taxes (“Topic 740”). Under Topic 740, deferred tax assets and liabilities are determined based on the difference between their financial reporting and tax basis. The assets and liabilities are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company reduces its deferred tax assets by a valuation allowance if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In making this determination, the Company evaluates all available information including the Company’s financial position and results of operations for the current and preceding years, as well as any available projected information for future years. For the three months ended March 31, 2017 , the provision for income taxes was $2.7 million as compared to $2.7 million for the three months ended March 31, 2016 . The slight increase in tax expense in the three months ended March 31, 2017 was primarily attributable to the geographic mix of earnings. Generally, the provision for income taxes is primarily impacted by income earned in tax paying jurisdictions relative to income earned in non-tax paying jurisdictions. The majority of income recognized for purposes of computing the effective tax rate is earned in countries where the statutory income tax rates range from 15.0% to 35.4% ; however, permanent income adjustments recorded against pre-tax earnings may result in an effective tax rate that is higher or lower than the statutory tax rate in these jurisdictions. The Company generates losses in certain jurisdictions for which no tax benefit is realized, as the deferred tax assets in these jurisdictions (including the net operating losses) are fully reserved in the valuation allowance. For this reason, the Company recognizes minimal income tax expense or benefit in these jurisdictions, of which the most material jurisdictions are the United States and Australia. Due to these reserves, the geographic mix of the Company’s pre-tax earnings has a direct correlation with how high or low its annual effective tax rate is relative to consolidated earnings. As the Company continues to reorganize and restructure its operations, it is possible that deferred tax assets, for which no income tax benefit has previously been provided, may more likely than not become realized. The Company continues to evaluate future operations and will record an income tax benefit in the period where it believes it is more likely than not that the deferred tax asset will be able to be realized. The most material unrecognized deferred tax asset relates to the U.S. By 2029, future U.S. earnings ranging between $40 million and $130 million , generated by U.S. earnings from continuing operations or qualified tax planning strategies, would be required in order to fully recognize the U.S. deferred tax asset. Historic and future ownership changes could potentially reduce the amount of net operating loss carry-forwards available for use. As of March 31, 2017 , the Company had a gross amount of unrecognized tax benefit of $9.7 million , exclusive of interest and penalties. The unrecognized tax benefit increased by approximately $0.4 million during the three months ended March 31, 2017 , as a result of new positions related to the current year and foreign currency effects. The Company’s policy is to recognize interest and penalties related to income tax matters as income tax expense, which were $0.4 million related to the unrecognized tax benefits for the three months ended March 31, 2017 . The tax years 2007 through 2016 remain open to examination in a number of the major tax jurisdictions to which the Company and its subsidiaries are subject. The Company believes that it has made adequate provisions for all income tax uncertainties. |
Pensions, Other Post-retirement
Pensions, Other Post-retirement and Post-employment Benefits | 3 Months Ended |
Mar. 31, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
Pensions, Other Post-retirement and Post-employment Benefits | Pensions, Other Post-retirement and Post-employment Benefits The Company accounts for its pensions, other post-retirement and post-employment benefit plans in accordance with ASC Topic 715, Compensation—Retirement Benefits (“Topic 715”). The Company has defined benefit pension plans covering substantially all of its U.S. and Canadian employees and employees of certain subsidiaries in other countries. Benefits are generally based on the employee’s years of service and compensation. These plans are funded in conformity with the funding requirements of applicable government regulations. The Company does not fund certain plans, as funding is not required. The Company plans to continue to fund its U.S. defined benefit plans to comply with the Pension Protection Act of 2006. In addition, the Company also intends to fund its U.K. and Canadian defined benefit plans in accordance with local regulations. As required by Topic 715, the following tables summarize the components of net periodic benefit cost: Defined Benefit Plans Three Months Ended March 31, 2017 2016 Service cost $ 376 $ 405 Interest cost 1,267 1,485 Expected return on plan assets (1,496 ) (1,548 ) Amortization of net loss 590 558 Net periodic benefit cost $ 737 $ 900 |
Comprehensive Income and Accumu
Comprehensive Income and Accumulated Other Comprehensive Loss | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Comprehensive Income and Accumulated Other Comprehensive Loss | Comprehensive Income and Accumulated Other Comprehensive Loss Comprehensive income for the three months ended March 31, 2017 (net of tax expense of $109 thousand ) and 2016 (net of a tax expense of $67 thousand ) is as follows: Three Months Ended March 31, 2017 2016 Net loss $ (2,834 ) $ (1,445 ) Foreign currency translation adjustments 9,765 8,460 Pension liability changes under Topic 715 (125 ) 358 Comprehensive income $ 6,806 $ 7,373 The components of accumulated other comprehensive loss for the three months ended March 31, 2017 are as follows (net of tax benefits of $5.9 million ): Foreign Currency Translation Adjustment Pension Liability Changes Under Topic 715 Accumulated Other Comprehensive (Loss) Income Balance at December 31, 2016 $ (95,232 ) $ (39,446 ) $ (134,678 ) Other comprehensive income before reclassifications 9,765 (715 ) 9,050 Amounts reclassified from other comprehensive loss: Amortization of actuarial losses — 590 590 Net current period other comprehensive income 9,765 (125 ) 9,640 Balance at March 31, 2017 $ (85,467 ) $ (39,571 ) $ (125,038 ) For the three months ended March 31, 2017 , the amortization of actuarial losses is included in cost of products sold and general and administrative expenses in the Consolidated Statements of Operations. |
Restructuring Expense
Restructuring Expense | 3 Months Ended |
Mar. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Expense | Restructuring Expense For the three months ended March 31, 2017 , the Company incurred restructuring expenses of $3.2 million relating to headcount reductions and other costs related to previous plant closures. For the three months ended March 31, 2016 , the Company incurred restructuring expenses of $2.8 million . These included $0.7 million of charges related to the closure of the Middletown, Va. facility and $2.1 million of charges relating to headcount reductions and other costs related to previous plant closures. The following table sets forth the significant components of the restructuring accrual (included in Accrued Expenses on our Consolidated Balance Sheet), including activity under restructuring programs for the three months ended March 31, 2017 and 2016 : Balance at December 31, 2016 Charges Currency Cash Balance at Severance and other benefits $ 3,805 $ 2,258 $ 138 $ (1,061 ) $ 5,140 Facility costs and other 392 906 14 (980 ) 332 Total $ 4,197 $ 3,164 $ 152 $ (2,041 ) $ 5,472 Balance at December 31, 2015 Charges Currency Cash Balance at Severance and other benefits $ 5,308 $ 1,390 $ 62 $ (1,804 ) $ 4,956 Facility costs and other 903 1,442 63 (1,871 ) 537 Total $ 6,211 $ 2,832 $ 125 $ (3,675 ) $ 5,493 Restructuring and impairment expense by segment, which is not included in Segment Earnings in Note 9, is as follows: Three Months Ended March 31, 2017 2016 Clothing $ 2,476 $ 1,452 Roll Covers 627 891 Corporate 61 489 Total $ 3,164 $ 2,832 |
Business Segment Information
Business Segment Information | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Business Segment Information | Business Segment Information The Company is a global manufacturer and supplier of consumable products used primarily in the production of paper and is organized into two reportable segments: clothing and roll covers. The clothing segment represents the manufacture and sale of synthetic textile belts used to transport paper or other materials along the length of papermaking or other industrial machines. The roll covers segment primarily represents the manufacture and refurbishment of covers used on the steel rolls of papermaking or manufacturing machines and the servicing of those rolls. The Company manages each of these operating segments separately. Management evaluates segment performance based on adjusted earnings before interest, taxes, depreciation and amortization, yet after allocation of corporate charges. Such measure is then adjusted to exclude items that are of an unusual nature and are not used in measuring segment performance or are not segment specific (“Segment Earnings (Loss)”). The accounting policies of these segments are the same as those for the Company as a whole. Inter-segment net sales and inter-segment eliminations are not material for any of the periods presented. Summarized financial information for the Company’s reportable segments is presented in the tables that follow for the three months ended March 31, 2017 and 2016 . Clothing Roll Corporate Total Three months ended March 31, 2017 Net Sales $ 72,495 $ 47,371 $ — $ 119,866 Segment Earnings (Loss) $ 20,807 $ 9,795 $ (4,029 ) $ 26,573 Three months ended March 31, 2016 Net Sales $ 71,337 $ 43,628 $ — $ 114,965 Segment Earnings (Loss) $ 18,635 $ 9,198 $ (3,898 ) $ 23,935 Provided below is a reconciliation of Segment Earnings (Loss) to (Loss) Income before provision for income taxes for the three months ended March 31, 2017 and 2016 , respectively. Three Months Ended March 31, 2017 2016 Segment Earnings (Loss): Clothing $ 20,807 $ 18,635 Roll Covers 9,795 9,198 Corporate (4,029 ) (3,898 ) Stock-based compensation (531 ) (592 ) Interest expense, net (13,263 ) (10,341 ) Depreciation and amortization (8,093 ) (7,994 ) Loss on extinguishment of debt (25 ) — Restructuring expense (3,164 ) (2,832 ) Other non-recurring expense (45 ) (103 ) Plant startup costs (480 ) (877 ) Foreign exchange (loss) gain (1,125 ) 24 (Loss) income before provision for income taxes $ (153 ) $ 1,220 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is involved in various legal matters which have arisen in the ordinary course of business as a result of various immaterial labor claims, taxing authority reviews and other routine legal matters. As of March 31, 2017 , the Company accrued an immaterial amount in its financial statements for these matters for which the Company believed the possibility of loss was probable and was able to estimate the damages. The Company does not believe that the ultimate resolution of these matters will have a material adverse effect on its financial position, results of operations or cash flow. The Company believes that any additional liability in excess of amounts provided which may result from the resolution of legal matters will not have a material adverse effect on the financial condition, liquidity or cash flow of the Company. |
Stock-Based Compensation and St
Stock-Based Compensation and Stockholders' Deficit | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation and Stockholders' Deficit | Stock-Based Compensation and Stockholders’ Deficit The Company records stock-based compensation expense in accordance with ASC Topic 718, Accounting for Stock Compensation and has used the straight-line attribution method to recognize expense for RSUs, options and DSUs. The Company recorded stock-based compensation expense during the three months ended March 31, 2017 and March 31, 2016 as follows: Three Months Ended March 31, 2017 2016 RSU, Options and DSU Awards (1) $ 531 $ 592 (1) Related to RSUs, Options and DSUs awarded to certain employees and non-employee directors. Summary of Activity Under Long-term Incentive Plans Long-Term Incentive Program—2015 LTIP and 2014 LTIP During the first quarter of 2016 the Company performed a valuation on the market-based stock units and estimated payout to be at 0% under both the 2015 and 2014 LTIP plans, reducing stock-based compensation by $0.2 million . Directors’ Deferred Stock Unit Plan Under the 2011 non-management directors stock plan ("2011 DSU Plan”), as amended in January of 2015, each director receives an annual retainer of $132 thousand , to be paid on a quarterly basis in arrears. Approximately 54% of the annual retainer is payable in DSUs, with the remaining 46% payable in cash or a mix of both cash and DSUs at the election of each director. The non-management directors were awarded an aggregate of 17,787 DSUs under the 2011 DSU Plan for service during the three months ended March 31, 2017 . In addition, in accordance with the 2011 DSU Plan, as amended in January of 2015, 15,003 DSUs were settled in common stock during the three months ended March 31, 2017 . |
Supplemental Guarantor Financia
Supplemental Guarantor Financial Information | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Guarantor Financial Information | Supplemental Guarantor Financial Information On August 9, 2016, the Company closed on the sale of its Notes. The Notes are secured obligations of the Company and are fully and unconditionally guaranteed on a senior secured basis by all of the domestic wholly owned subsidiaries of the Company (the “Guarantors”). In accordance with Rule 3-10 of Regulation S-X promulgated under the Securities Act of 1933, as amended, the following condensed consolidating financial statements present the financial position, results of operations and cash flows of Xerium Technologies, Inc. (referred to as “Parent” for the purpose of this note only) on a stand-alone parent-only basis, the Guarantors on a Guarantors-only basis, the combined non-Guarantor subsidiaries and elimination entries necessary to arrive at the information for the Parent, the Guarantors and non-Guarantor subsidiaries on a consolidated basis. Xerium Technologies, Inc. Consolidating Balance Sheet—(Unaudited) At March 31, 2017 (Dollars in thousands) Parent Total Total Non Other The ASSETS Current assets: Cash and cash equivalents $ 2,056 $ 66 $ 8,016 $ — $ 10,138 Accounts receivable, net 78 21,783 52,805 — 74,666 Intercompany receivables (428,202 ) 428,150 52 — — Inventories, net — 17,295 57,813 (1,111 ) 73,997 Prepaid expenses 771 105 4,782 — 5,658 Other current assets — 3,896 13,837 — 17,733 Total current assets (425,297 ) 471,295 137,305 (1,111 ) 182,192 Property and equipment, net 8,069 66,229 213,711 — 288,009 Investments 878,223 231,443 — (1,109,666 ) — Goodwill — 19,614 38,450 — 58,064 Intangible assets — 7,019 675 — 7,694 Non-current deferred tax asset — — 12,810 — 12,810 Other assets — (121 ) 8,471 — 8,350 Total assets $ 460,995 $ 795,479 $ 411,422 $ (1,110,777 ) $ 557,119 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Notes payable $ — $ — $ 7,596 $ — $ 7,596 Accounts payable 2,026 12,048 28,187 — 42,261 Accrued expenses 11,894 7,363 33,292 — 52,549 Current maturities of long-term debt 2,428 2,606 4,369 — 9,403 Total current liabilities 16,348 22,017 73,444 — 111,809 Long-term debt, net of current maturities 475,627 — 8,354 — 483,981 Liabilities under capital leases 5,281 4,093 8,842 — 18,216 Non-current deferred tax liability 1,301 — 7,141 — 8,442 Pension, other post-retirement and post-employment obligations 20,258 811 44,114 — 65,183 Other long-term liabilities — 1,250 7,806 — 9,056 Intercompany loans 63,376 (99,159 ) 35,783 — — Total stockholders’ (deficit) equity (121,196 ) 866,467 225,938 (1,110,777 ) (139,568 ) Total liabilities and stockholders’ equity (deficit) $ 460,995 $ 795,479 $ 411,422 $ (1,110,777 ) $ 557,119 Xerium Technologies, Inc. Consolidating Balance Sheet At December 31, 2016 (Dollars in thousands) Parent Total Total Non Other The ASSETS Current assets: Cash and cash equivalents $ 1,368 $ 279 $ 11,161 $ — $ 12,808 Accounts receivable, net 70 18,787 49,810 — 68,667 Intercompany receivables (410,370 ) 419,192 (8,822 ) — — Inventories, net — 17,356 54,577 (1,111 ) 70,822 Prepaid expenses 545 395 5,385 — 6,325 Other current assets — 3,842 11,942 — 15,784 Total current assets (408,387 ) 459,851 124,053 (1,111 ) 174,406 Property and equipment, net 8,393 67,794 207,914 — 284,101 Investments 869,508 211,897 — (1,081,405 ) — Goodwill — 19,614 37,169 — 56,783 Intangible assets — 7,265 65 — 7,330 Non-current deferred tax asset — — 10,737 — 10,737 Other assets — — 8,556 — 8,556 Total assets $ 469,514 $ 766,421 $ 388,494 $ (1,082,516 ) $ 541,913 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Notes payable $ — $ — $ 7,328 $ — $ 7,328 Accounts payable 2,279 10,307 23,572 — 36,158 Accrued expenses 26,495 8,659 29,378 — 64,532 Current maturities of long-term debt 2,342 2,320 3,938 — 8,600 Total current liabilities 31,116 21,286 64,216 — 116,618 Long-term debt, net of current maturities 464,494 — 8,429 — 472,923 Liabilities under capital leases 5,830 4,627 8,779 — 19,236 Non-current deferred tax liability 1,270 — 5,887 — 7,157 Pension, other post-retirement and post-employment obligations 20,923 763 43,340 — 65,026 Other long-term liabilities — 1,250 6,608 — 7,858 Intercompany loans 63,923 (97,953 ) 34,030 — — Total stockholders’ (deficit) equity (118,042 ) 836,448 217,205 (1,082,516 ) (146,905 ) Total liabilities and stockholders’ equity (deficit) $ 469,514 $ 766,421 $ 388,494 $ (1,082,516 ) $ 541,913 Xerium Technologies, Inc. Consolidating Statement of Operations and Comprehensive (Loss) Income (Unaudited) For the three months ended March 31, 2017 (Dollars in thousands) Parent Total Total Non Other The Net sales $ — $ 46,945 $ 81,084 $ (8,163 ) $ 119,866 Costs and expenses: Cost of products sold — 30,948 49,585 (8,163 ) 72,370 Selling 233 5,044 10,397 — 15,674 General and administrative 2,702 974 8,978 — 12,654 Research and development 299 931 514 — 1,744 Restructuring 61 642 2,461 — 3,164 3,295 38,539 71,935 (8,163 ) 105,606 (Loss) income from operations (3,295 ) 8,406 9,149 — 14,260 Interest (expense) income, net (12,338 ) (347 ) (578 ) — (13,263 ) Foreign exchange gain (loss) (472 ) 65 (718 ) — (1,125 ) Equity in subsidiaries income 8,714 4,381 — (13,095 ) — Loss on extinguishment of debt (25 ) — — — (25 ) Dividend income 4,263 3,858 — (8,121 ) — (Loss) income before provision for income taxes (3,153 ) 16,363 7,853 (21,216 ) (153 ) Provision for income taxes 319 (141 ) (2,859 ) — (2,681 ) Net (loss) income $ (2,834 ) $ 16,222 $ 4,994 $ (21,216 ) $ (2,834 ) Comprehensive (loss) income $ (3,684 ) $ 16,230 $ 15,476 $ (21,216 ) $ 6,806 Xerium Technologies, Inc. Consolidating Statement of Operations and Comprehensive Income (Loss)-(Unaudited) For the three months ended March 31, 2016 (Dollars in thousands) Parent Total Total Non Other The Net sales $ — $ 40,588 $ 81,600 $ (7,223 ) $ 114,965 Costs and expenses: Cost of products sold — 28,296 50,259 (7,127 ) 71,428 Selling 305 5,011 10,405 — 15,721 General and administrative 2,691 923 7,893 — 11,507 Research and development 380 1,091 469 — 1,940 Restructuring 428 1,028 1,376 — 2,832 3,804 36,349 70,402 (7,127 ) 103,428 (Loss) income from operations (3,804 ) 4,239 11,198 (96 ) 11,537 Interest (expense) income, net (9,714 ) 517 (1,144 ) — (10,341 ) Foreign exchange gain (loss) 17 (54 ) 61 — 24 Equity in subsidiaries income 9,102 7,804 — (16,906 ) — Dividend income 3,145 — — (3,145 ) — (Loss) income before provision for income taxes (1,254 ) 12,506 10,115 (20,147 ) 1,220 Provision for income taxes (191 ) (2 ) (2,472 ) — (2,665 ) Net (loss) income $ (1,445 ) $ 12,504 $ 7,643 $ (20,147 ) $ (1,445 ) Comprehensive (loss) income $ (606 ) $ 12,494 $ 15,632 $ (20,147 ) $ 7,373 Xerium Technologies, Inc. Consolidating Statement of Cash Flows-(Unaudited) For the three months ended March 31, 2017 (Dollars in thousands) Parent Total Total Non Other The Operating activities Net (loss) income $ (2,834 ) $ 16,222 $ 4,994 $ (21,216 ) $ (2,834 ) Adjustments to reconcile net (loss) income to net cash(used in) provided by operating activities: Stock-based compensation 531 — — — 531 Depreciation 579 2,069 5,171 — 7,819 Amortization of intangible assets — 246 27 — 273 Deferred financing cost amortization 875 — 24 — 899 Foreign exchange gain on revaluation of debt 625 — 2 — 627 Deferred taxes (321 ) — 331 — 10 Loss on disposition of property and equipment — (37 ) (12 ) — (49 ) Loss on extinguishment of debt 25 — — — 25 Provision for doubtful accounts — (15 ) 56 — 41 Undistributed equity in earnings of subsidiaries (8,714 ) (4,381 ) — 13,095 — Change in assets and liabilities which (used) provided cash: Accounts receivable (8 ) (2,981 ) (1,164 ) — (4,153 ) Inventories — 62 (1,198 ) — (1,136 ) Prepaid expenses (226 ) 289 720 — 783 Other current assets — (117 ) (1,668 ) — (1,785 ) Accounts payable and accrued expenses (14,965 ) 443 7,188 — (7,334 ) Deferred and other long-term liabilities (47 ) 169 (1,062 ) — (940 ) Intercompany loans 17,832 (9,010 ) (8,822 ) — — Net cash (used in) provided by operating activities (6,648 ) 2,959 4,587 (8,121 ) (7,223 ) Investing activities Capital expenditures (158 ) (167 ) (4,960 ) — (5,285 ) Intercompany property and equipment transfers, net — 29 (29 ) — — Proceeds from disposals of property and equipment — 211 5 — 216 Net cash (used in) provided by investing activities (158 ) 73 (4,984 ) — (5,069 ) Financing activities Proceeds from borrowings 36,253 — 4,223 — 40,476 Principal payments on debt (25,730 ) — (3,963 ) — (29,693 ) Dividends paid — (4,263 ) (3,858 ) 8,121 — Payment of obligations under capital leases (656 ) (721 ) (143 ) — (1,520 ) Payment of financing fees (187 ) — 17 — (170 ) Intercompany loans (2,186 ) 1,739 447 — — Net cash provided by (used in) financing activities 7,494 (3,245 ) (3,277 ) 8,121 9,093 Effect of exchange rate changes on cash flows — — 529 — 529 Net increase (decrease) in cash 688 (213 ) (3,145 ) — (2,670 ) Cash and cash equivalents at beginning of period $ 1,368 $ 279 $ 11,161 $ — $ 12,808 Cash and cash equivalents at end of period $ 2,056 $ 66 $ 8,016 $ — $ 10,138 Xerium Technologies, Inc. Consolidating Statement of Cash Flows (Unaudited) For the three months ended March 31, 2016 (Dollars in Thousands) Parent Total Total Non Other The Operating activities Net (loss) income $ (1,445 ) $ 12,504 $ 7,643 $ (20,147 ) $ (1,445 ) Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: Stock-based compensation 603 — (11 ) — 592 Depreciation 555 2,053 5,292 — 7,900 Amortization of intangible assets — 69 25 — 94 Deferred financing cost amortization 732 — 24 — 756 Foreign exchange gain on revaluation of debt 1,120 — — — 1,120 Deferred taxes 173 — (18 ) — 155 Asset impairment — — — — — Loss on disposition of property and equipment — — 17 — 17 Provision for doubtful accounts — — (72 ) — (72 ) Undistributed equity in earnings of subsidiaries (9,102 ) (7,804 ) — 16,906 — Change in assets and liabilities which (used) provided cash: Accounts receivable (555 ) 842 (2,417 ) — (2,130 ) Inventories — 1,229 907 96 2,232 Prepaid expenses (872 ) 170 81 — (621 ) Other current assets — 167 857 — 1,024 Accounts payable and accrued expenses 6,459 (932 ) (838 ) — 4,689 Deferred and other long-term liabilities 3 379 410 — 792 Intercompany loans 1,925 (4,721 ) 2,796 — — Net cash (used in) provided by operating activities (404 ) 3,956 14,696 (3,145 ) 15,103 Investing activities Capital expenditures (117 ) (938 ) (2,495 ) — (3,550 ) Intercompany property and equipment transfers, net (2 ) 2 — — — Proceeds from disposals of property and equipment — 5 15 — 20 Net cash (used in) investing activities (119 ) (931 ) (2,480 ) — (3,530 ) Financing activities Proceeds from borrowings 10,992 — 2,321 — 13,313 Principal payments on debt (11,547 ) — (4,892 ) — (16,439 ) Dividends paid — (3,145 ) — 3,145 — Payments of obligations under capitalized leases (67 ) (517 ) (89 ) — (673 ) Payment of deferred financing fees (116 ) — 18 — (98 ) Intercompany loans 1,247 637 (1,884 ) — — Employee taxes paid on equity awards (1,029 ) — — — (1,029 ) Net cash (used in) provided by financing activities (520 ) (3,025 ) (4,526 ) 3,145 (4,926 ) Effect of exchange rate changes on cash flows — — (1,036 ) — (1,036 ) Net (decrease) increase in cash (1,043 ) — 6,654 — 5,611 Cash and cash equivalents at beginning of period 3,105 (2 ) 6,736 — 9,839 Cash and cash equivalents at end of period $ 2,062 $ (2 ) $ 13,390 $ — $ 15,450 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On April 28, 2017, the Company’s Board of Directors (the “Board”) appointed Mark Staton as President and Chief Executive Officer of the Company and also appointed him to the Board, in each case replacing Mr. Bevis. Mr. Bevis will receive severance pay of approximately $1.3 million to be paid over the next 18 months and will receive stock based compensation with an estimated value of approximately $1.7 million . |
Description of Business and S19
Description of Business and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated interim financial statements at March 31, 2017 and for the three months ended March 31, 2017 and 2016 include the accounts of the Company and its wholly-owned subsidiaries and have been prepared in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) for interim financial reporting and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Accordingly, such financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. GAAP requires the Company’s management to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results could differ from those estimates. The interim results presented herein are not necessarily indicative of the results to be expected for the entire year. In management’s opinion, these unaudited condensed consolidated interim financial statements contain all adjustments of a normal recurring nature necessary for a fair presentation of the financial statements for the interim periods presented. These unaudited condensed consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2016 as reported on the Company's Annual Report on Form 10-K filed on March 1, 2017. |
Inventories, net | Inventories, net Inventories are generally valued at the lower of cost or market using the first-in, first-out (FIFO) method. Raw materials are valued principally on a weighted average cost basis. The Company’s work in process and finished goods are specifically identified and valued based on actual inputs to production. Provisions are recorded as appropriate to write-down obsolete and excess inventory to estimated net realizable value. The process for evaluating obsolete and excess inventory often requires management to make subjective judgments and estimates concerning future sales levels, quantities and prices at which such inventory will be able to be sold in the normal course of business, while considering the general aging of inventory and factoring in any new business conditions. |
Goodwill | Goodwill The Company accounts for goodwill and other intangible assets in accordance with ASC Topic 350, Intangibles—Goodwill and Other Intangible Assets (“Topic 350”). Topic 350 requires that goodwill and intangible assets that have indefinite lives not be amortized, but instead, must be tested for impairment at least annually or whenever events or business conditions warrant. During the three months ended March 31, 2017 , the Company evaluated events and business conditions to determine if a test for an impairment of goodwill was warranted. No such events or business conditions took place during this period, therefore no test was determined to be warranted at March 31, 2017 . |
Warranties | Warranties The Company offers warranties on certain roll products that it sells. The specific terms and conditions of these warranties vary depending on the product sold, the country in which the product is sold and arrangements with the customer. The Company estimates the costs that may be incurred under its warranties and records a liability in Accrued Expenses on its Consolidated Balance Sheet for such costs. Factors that affect the Company’s warranty liability include the number of units sold, historical and anticipated rates of warranty claims, cost per claim and new product introduction. The Company periodically assesses the adequacy of its recorded warranty claims and adjusts the amounts as necessary. |
Net (Loss) Income Per Common Share | Net Loss Per Common Share Net loss per common share has been computed and presented pursuant to the provisions of ASC Topic 260, Earnings per Share (“Topic 260”). Net loss per share is based on the weighted-average number of shares outstanding during the period. |
Impairment | Impairment The Company reviews its long-lived assets that have finite lives for impairment in accordance with ASC Topic 360, Property, Plant, and Equipment (“Topic 360”). This topic requires that companies evaluate the fair value of long-lived assets based on the anticipated undiscounted future cash flows to be generated by the assets when indicators of impairment exist to determine if there is impairment to the carrying value. Any change in the carrying amount of an asset as a result of the Company's evaluation has been recorded in either restructuring expense, if it was a result of the Company's restructuring activities, or general and administrative expense for all other impairments in the consolidated statements of operations. |
New Accounting Pronouncements | New Accounting Pronouncements In March 2017, the FASB issued Accounting Standards Update No 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost ("ASU 2017-07"). ASU 2017-07 will change how employers that sponsor defined benefit pension and/or other post-retirement benefit plans present the net periodic benefit cost in the income statement. Employers will present the service cost component of net periodic benefit cost in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period. Only the service cost component will be eligible for capitalization in assets. Employers will present the other components of the net periodic benefit cost separately from the line item(s) that includes the service cost and outside of any subtotal of operating income, if one is presented. These components will not be eligible for capitalization in assets. The guidance is effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods therein. Early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. The guidance provides a practical expedient for disaggregating the service cost component and other components for comparative periods. The Company is in the process of evaluating this accounting standard update. In January 2017, the FASB issued Accounting Standards Update No 2017-04, Intangibles—Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 simplifies the accounting for goodwill impairment for all entities by requiring impairment charges to be based on the first step in today’s two-step impairment test under Accounting Standards Codification (ASC) 350. The FASB issued new guidance that eliminates the requirement to calculate the implied fair value of goodwill (i.e., Step 2 of today’s goodwill impairment test) to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value (i.e., measure the charge based on today’s Step 1). The standard has tiered effective dates, starting in 2020 for calendar-year public business entities that meet the definition of an SEC filer. Early adoption is permitted for annual and interim goodwill impairment testing dates after January 1, 2017. The Company is in the process of evaluating this accounting standard update. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory ("ASU 2016-16"). ASU 2016-16 eliminates the exception to the principle in ASC 740, for all intra-entity sales of assets other than inventory, to be deferred, until the transferred asset is sold to a third party or otherwise recovered through use. This standard is effective for financial statements issued for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements. In August 2016, the FASB issued Accounting Standards Update No 2016-15, Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments ("ASU 2016-15"). ASU 2016-15 clarifies how entities should classify certain cash receipts and cash payments in the statement of cash flows and amends certain disclosure requirements of ASC 230. The guidance will generally be applied retrospectively and is effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those years. For all other entities, it is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. The Company is in the process of evaluating this accounting standard update. In March of 2016, t he FASB issued Accounting Standards Update No 2016-09 Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"). ASU 2016-09 will change certain aspects of accounting for share-based payments to employees. The new guidance will require all income tax effects of awards to be recognized in the income statement when the awards vest or are settled. It also will allow an employer to repurchase more of an employee’s shares than it can today for tax withholding purposes without triggering liability accounting and to make a policy election to account for forfeitures as they occur. ASU 2016-09 is required to be adopted in January of 2017. The Company early adopted this standard at June 30, 2016. As of March 31, 2017 , the adoption of the standard has resulted in the re-classification of $1.0 million of employee taxes paid on equity awards as a financing activity in the statement of cash flows, for the three months ended March 31, 2016 . The remaining provisions of ASU 2016-09 did not have a material impact on the accompanying condensed consolidated financial statements. In February of 2016, the FASB issued Accounting Standards Update No 2016-02 Leases ("ASU 2016-02"). ASU 2016-02 includes final guidance that requires lessees to put most leases on their balance sheets but recognize expenses in the income statement in a manner similar to today’s accounting. The guidance also eliminates today’s real estate-specific provisions and changes the guidance on sale-leaseback transactions, initial direct costs and lease executory costs for all entities. For lessors, the standard modifies the classification criteria and the accounting for sales-type and direct financing leases. All entities will classify leases to determine how to recognize lease-related revenue and expense. Classification will continue to affect amounts that lessors record on the balance sheet. Entities are required to use a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. They have the option to use certain relief. Full retrospective application is prohibited. ASU 2016-02 is effective for public companies with annual periods beginning after 15 December 2018, and interim periods within those years. For all other entities, it is effective for annual periods beginning after 15 December 2019, and interim periods the following year. Early adoption is permitted for all entities. The Company is in the process of evaluating this accounting standard update. In November of 2015, the FASB issued ASU 2015-17 Income Taxes (Topic 740), Balance Sheet Classification of Deferred Taxes ("ASU 2015-17"). This guidance requires companies to classify all deferred tax assets and liabilities as non-current on the balance sheet instead of separating deferred taxes into current and non-current amounts. For public companies, the guidance is effective for financial statements issued for annual periods beginning after 15 December 2016 (i.e., 2017 for a calendar-year company) and interim periods within those annual periods. Early adoption of the guidance is permitted. Companies can adopt the guidance either prospectively or retrospectively. The Company early adopted this standard at December 31, 2016, using the prospective method; prior periods were not retrospectively adjusted. The provisions of ASU 2015-17 did not have a material impact on the consolidated financial statements. In July of 2015, the FASB issued Accounting Standards Update Inventory ("ASU 2015-11"). ASU 2015-11 applies only to first-in, first-out (FIFO) and average cost inventory costing methods and will reduce costs and increase comparability for these methods. There will be no change for last-in, first-out, (LIFO) or retail inventory methods as the costs of transitioning to a new method would outweigh the benefits due to the complexity of these methods. Under this ASU, inventory should be measured at the lower of cost and net realizable value (selling prices in the ordinary course of business less reasonably predictable costs of completion, disposal, and transportation). When the net realizable value of inventory is less than its cost, the difference will be recognized as a loss in earnings in the period in which it occurs. This ASU more closely aligns the measurement of inventory under GAAP with International Financial Reporting Standards guidance. The amendments are effective for public companies for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years, and for other entities, the amendments are effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. The amendments should be applied prospectively, and early application is permitted as of the beginning of an interim or annual reporting period. The Company implemented this standard during the first quarter of 2016. The provisions of ASU 2015-11 did not have an impact to the financial statements. In May of 2014, the FASB issued Accounting Standard Update No. 2014-09 Revenue from Contracts with Customers ("ASU 2014-09"). ASU 2014-09 requires the use of a new five-step model to recognize revenue from customer contracts. The five-step model requires that the Company identify the contract with the customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract and recognize revenue when it satisfies the performance obligations. The Company will also be required to disclose information regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. ASU 2014-09 is required to be adopted in January of 2018. Retrospective application is required either to all periods presented or with the cumulative effect of initial adoption recognized in the period of adoption. The Company has commenced a comprehensive project plan to direct the implementation of the new revenue recognition standards and an assessment of the impact to business processes. The Company intends to adopt the new standard using the modified retrospective transition method effective January 1, 2018. |
Description of Business and S20
Description of Business and Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Components of Inventories | The components of inventories are as follows at: March 31, 2017 December 31, 2016 Raw materials $ 14,706 $ 14,089 Work in process 27,205 25,879 Finished goods (includes consigned inventory of $6,985 at March 31, 2017 and $6,673 at December 31, 2016) 38,866 37,155 Inventory allowances (6,780 ) (6,301 ) $ 73,997 $ 70,822 |
Changes in Warranty Liability | The table below represents the changes in the Company’s warranty liability for the three months ended March 31, 2017 and 2016 : Beginning Balance Charged to Cost of Sales Effect of Foreign Currency Translation Deduction from Reserves Ending Balance Three Months Ended March 31, 2017: $ 2,203 $ 235 $ 30 $ (179 ) $ 2,289 Three Months Ended March 31, 2016: $ 2,175 $ 477 $ 34 $ (189 ) $ 2,497 |
Computation of Basic and Diluted Weighted-Average Shares | The following table sets forth the computation of basic and diluted weighted-average shares: Three Months Ended March 31, 2017 2016 Weighted-average common shares outstanding–basic 16,153,113 15,789,991 Dilutive effect of stock-based compensation awards outstanding — — Weighted-average common shares outstanding–diluted 16,153,113 15,789,991 |
Schedule of Antidilutive Securities Excluded from Computation of Diluted Earnings Per Share | The following table sets forth the aggregate of the potentially dilutive securities that were outstanding in the three months ended March 31, 2017 and 2016 , but were not included in the computation of diluted earnings per share because the impact would have been anti-dilutive: Three Months Ended March 31, 2017 2016 Anti-dilutive securities 902,988 738,294 |
Derivatives and Hedging (Tables
Derivatives and Hedging (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments | The following represents the fair value of these derivatives at March 31, 2017 and December 31, 2016 and the change in fair value included in foreign exchange gain (loss) in the three months ended March 31, 2017 and 2016 : March 31, 2017 December 31, 2016 Fair value of derivative (liability) $ (79 ) $ (1,461 ) Three Months Ended March 31, 2017 Three Months Ended March 31, 2016 Change in fair value of derivative included in foreign exchange (loss) gain $ 145 $ 1,170 |
Notional Amounts of Foreign Exchange Forward Contracts | The following represents the notional amounts of foreign exchange forward contracts at March 31, 2017 : Notional Sold Notional Purchased Non-designated hedges of foreign exchange risk $ — $ (987 ) |
Long term Debt (Tables)
Long term Debt (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Long Term Debt | At March 31, 2017 and December 31, 2016 , long term debt consisted of the following: March 31, 2017 December 31, 2016 Notes (Secured), payable semi-annually–U.S. Dollar denominated interest rate fixed at 9.50%. Sold at a price equal to 98.54% of their face value. Matures August of 2021. $ 480,000 $ 480,000 Notes payable, working capital loan, variable interest rate at 2.05%. Matures June 30, 2017, with one-year rollover option. 7,596 7,328 Fixed asset loan contract, variable interest rate of 5.78%. Matures June of 2020. 7,590 7,511 Other debt 21,593 10,448 Total debt (excluding long-term capital leases and deferred finance fees) 516,779 505,287 Less deferred financing costs and debt discount (15,799 ) (16,436 ) Less current maturities of long term debt and notes payable (16,999 ) (15,928 ) Total long term debt $ 483,981 $ 472,923 |
Pensions, Other Post-retireme23
Pensions, Other Post-retirement and Post-employment Benefits (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
Components of Net Periodic Benefit Cost | As required by Topic 715, the following tables summarize the components of net periodic benefit cost: Defined Benefit Plans Three Months Ended March 31, 2017 2016 Service cost $ 376 $ 405 Interest cost 1,267 1,485 Expected return on plan assets (1,496 ) (1,548 ) Amortization of net loss 590 558 Net periodic benefit cost $ 737 $ 900 |
Comprehensive Income and Accu24
Comprehensive Income and Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Components of Comprehensive Loss, Net of Tax | Comprehensive income for the three months ended March 31, 2017 (net of tax expense of $109 thousand ) and 2016 (net of a tax expense of $67 thousand ) is as follows: Three Months Ended March 31, 2017 2016 Net loss $ (2,834 ) $ (1,445 ) Foreign currency translation adjustments 9,765 8,460 Pension liability changes under Topic 715 (125 ) 358 Comprehensive income $ 6,806 $ 7,373 |
Components of Accumulated Other Comprehensive Loss | The components of accumulated other comprehensive loss for the three months ended March 31, 2017 are as follows (net of tax benefits of $5.9 million ): Foreign Currency Translation Adjustment Pension Liability Changes Under Topic 715 Accumulated Other Comprehensive (Loss) Income Balance at December 31, 2016 $ (95,232 ) $ (39,446 ) $ (134,678 ) Other comprehensive income before reclassifications 9,765 (715 ) 9,050 Amounts reclassified from other comprehensive loss: Amortization of actuarial losses — 590 590 Net current period other comprehensive income 9,765 (125 ) 9,640 Balance at March 31, 2017 $ (85,467 ) $ (39,571 ) $ (125,038 ) |
Restructuring Expense (Tables)
Restructuring Expense (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Programs | The following table sets forth the significant components of the restructuring accrual (included in Accrued Expenses on our Consolidated Balance Sheet), including activity under restructuring programs for the three months ended March 31, 2017 and 2016 : Balance at December 31, 2016 Charges Currency Cash Balance at Severance and other benefits $ 3,805 $ 2,258 $ 138 $ (1,061 ) $ 5,140 Facility costs and other 392 906 14 (980 ) 332 Total $ 4,197 $ 3,164 $ 152 $ (2,041 ) $ 5,472 Balance at December 31, 2015 Charges Currency Cash Balance at Severance and other benefits $ 5,308 $ 1,390 $ 62 $ (1,804 ) $ 4,956 Facility costs and other 903 1,442 63 (1,871 ) 537 Total $ 6,211 $ 2,832 $ 125 $ (3,675 ) $ 5,493 |
Restructuring and Impairment Expense by Segment | Restructuring and impairment expense by segment, which is not included in Segment Earnings in Note 9, is as follows: Three Months Ended March 31, 2017 2016 Clothing $ 2,476 $ 1,452 Roll Covers 627 891 Corporate 61 489 Total $ 3,164 $ 2,832 |
Business Segment Information (T
Business Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Summarized Financial Information and Segment Earnings (Loss) | Summarized financial information for the Company’s reportable segments is presented in the tables that follow for the three months ended March 31, 2017 and 2016 . Clothing Roll Corporate Total Three months ended March 31, 2017 Net Sales $ 72,495 $ 47,371 $ — $ 119,866 Segment Earnings (Loss) $ 20,807 $ 9,795 $ (4,029 ) $ 26,573 Three months ended March 31, 2016 Net Sales $ 71,337 $ 43,628 $ — $ 114,965 Segment Earnings (Loss) $ 18,635 $ 9,198 $ (3,898 ) $ 23,935 Provided below is a reconciliation of Segment Earnings (Loss) to (Loss) Income before provision for income taxes for the three months ended March 31, 2017 and 2016 , respectively. Three Months Ended March 31, 2017 2016 Segment Earnings (Loss): Clothing $ 20,807 $ 18,635 Roll Covers 9,795 9,198 Corporate (4,029 ) (3,898 ) Stock-based compensation (531 ) (592 ) Interest expense, net (13,263 ) (10,341 ) Depreciation and amortization (8,093 ) (7,994 ) Loss on extinguishment of debt (25 ) — Restructuring expense (3,164 ) (2,832 ) Other non-recurring expense (45 ) (103 ) Plant startup costs (480 ) (877 ) Foreign exchange (loss) gain (1,125 ) 24 (Loss) income before provision for income taxes $ (153 ) $ 1,220 |
Stock-Based Compensation and 27
Stock-Based Compensation and Stockholders' Deficit (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation Expense | The Company recorded stock-based compensation expense during the three months ended March 31, 2017 and March 31, 2016 as follows: Three Months Ended March 31, 2017 2016 RSU, Options and DSU Awards (1) $ 531 $ 592 (1) Related to RSUs, Options and DSUs awarded to certain employees and non-employee directors. |
Supplemental Guarantor Financ28
Supplemental Guarantor Financial Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidating Balance Sheet-(Unaudited) | Xerium Technologies, Inc. Consolidating Balance Sheet—(Unaudited) At March 31, 2017 (Dollars in thousands) Parent Total Total Non Other The ASSETS Current assets: Cash and cash equivalents $ 2,056 $ 66 $ 8,016 $ — $ 10,138 Accounts receivable, net 78 21,783 52,805 — 74,666 Intercompany receivables (428,202 ) 428,150 52 — — Inventories, net — 17,295 57,813 (1,111 ) 73,997 Prepaid expenses 771 105 4,782 — 5,658 Other current assets — 3,896 13,837 — 17,733 Total current assets (425,297 ) 471,295 137,305 (1,111 ) 182,192 Property and equipment, net 8,069 66,229 213,711 — 288,009 Investments 878,223 231,443 — (1,109,666 ) — Goodwill — 19,614 38,450 — 58,064 Intangible assets — 7,019 675 — 7,694 Non-current deferred tax asset — — 12,810 — 12,810 Other assets — (121 ) 8,471 — 8,350 Total assets $ 460,995 $ 795,479 $ 411,422 $ (1,110,777 ) $ 557,119 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Notes payable $ — $ — $ 7,596 $ — $ 7,596 Accounts payable 2,026 12,048 28,187 — 42,261 Accrued expenses 11,894 7,363 33,292 — 52,549 Current maturities of long-term debt 2,428 2,606 4,369 — 9,403 Total current liabilities 16,348 22,017 73,444 — 111,809 Long-term debt, net of current maturities 475,627 — 8,354 — 483,981 Liabilities under capital leases 5,281 4,093 8,842 — 18,216 Non-current deferred tax liability 1,301 — 7,141 — 8,442 Pension, other post-retirement and post-employment obligations 20,258 811 44,114 — 65,183 Other long-term liabilities — 1,250 7,806 — 9,056 Intercompany loans 63,376 (99,159 ) 35,783 — — Total stockholders’ (deficit) equity (121,196 ) 866,467 225,938 (1,110,777 ) (139,568 ) Total liabilities and stockholders’ equity (deficit) $ 460,995 $ 795,479 $ 411,422 $ (1,110,777 ) $ 557,119 Xerium Technologies, Inc. Consolidating Balance Sheet At December 31, 2016 (Dollars in thousands) Parent Total Total Non Other The ASSETS Current assets: Cash and cash equivalents $ 1,368 $ 279 $ 11,161 $ — $ 12,808 Accounts receivable, net 70 18,787 49,810 — 68,667 Intercompany receivables (410,370 ) 419,192 (8,822 ) — — Inventories, net — 17,356 54,577 (1,111 ) 70,822 Prepaid expenses 545 395 5,385 — 6,325 Other current assets — 3,842 11,942 — 15,784 Total current assets (408,387 ) 459,851 124,053 (1,111 ) 174,406 Property and equipment, net 8,393 67,794 207,914 — 284,101 Investments 869,508 211,897 — (1,081,405 ) — Goodwill — 19,614 37,169 — 56,783 Intangible assets — 7,265 65 — 7,330 Non-current deferred tax asset — — 10,737 — 10,737 Other assets — — 8,556 — 8,556 Total assets $ 469,514 $ 766,421 $ 388,494 $ (1,082,516 ) $ 541,913 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Notes payable $ — $ — $ 7,328 $ — $ 7,328 Accounts payable 2,279 10,307 23,572 — 36,158 Accrued expenses 26,495 8,659 29,378 — 64,532 Current maturities of long-term debt 2,342 2,320 3,938 — 8,600 Total current liabilities 31,116 21,286 64,216 — 116,618 Long-term debt, net of current maturities 464,494 — 8,429 — 472,923 Liabilities under capital leases 5,830 4,627 8,779 — 19,236 Non-current deferred tax liability 1,270 — 5,887 — 7,157 Pension, other post-retirement and post-employment obligations 20,923 763 43,340 — 65,026 Other long-term liabilities — 1,250 6,608 — 7,858 Intercompany loans 63,923 (97,953 ) 34,030 — — Total stockholders’ (deficit) equity (118,042 ) 836,448 217,205 (1,082,516 ) (146,905 ) Total liabilities and stockholders’ equity (deficit) $ 469,514 $ 766,421 $ 388,494 $ (1,082,516 ) $ 541,913 |
Consolidating Statement of Operations and Comprehensive Income (Loss)-(Unaudited) | Xerium Technologies, Inc. Consolidating Statement of Operations and Comprehensive (Loss) Income (Unaudited) For the three months ended March 31, 2017 (Dollars in thousands) Parent Total Total Non Other The Net sales $ — $ 46,945 $ 81,084 $ (8,163 ) $ 119,866 Costs and expenses: Cost of products sold — 30,948 49,585 (8,163 ) 72,370 Selling 233 5,044 10,397 — 15,674 General and administrative 2,702 974 8,978 — 12,654 Research and development 299 931 514 — 1,744 Restructuring 61 642 2,461 — 3,164 3,295 38,539 71,935 (8,163 ) 105,606 (Loss) income from operations (3,295 ) 8,406 9,149 — 14,260 Interest (expense) income, net (12,338 ) (347 ) (578 ) — (13,263 ) Foreign exchange gain (loss) (472 ) 65 (718 ) — (1,125 ) Equity in subsidiaries income 8,714 4,381 — (13,095 ) — Loss on extinguishment of debt (25 ) — — — (25 ) Dividend income 4,263 3,858 — (8,121 ) — (Loss) income before provision for income taxes (3,153 ) 16,363 7,853 (21,216 ) (153 ) Provision for income taxes 319 (141 ) (2,859 ) — (2,681 ) Net (loss) income $ (2,834 ) $ 16,222 $ 4,994 $ (21,216 ) $ (2,834 ) Comprehensive (loss) income $ (3,684 ) $ 16,230 $ 15,476 $ (21,216 ) $ 6,806 Xerium Technologies, Inc. Consolidating Statement of Operations and Comprehensive Income (Loss)-(Unaudited) For the three months ended March 31, 2016 (Dollars in thousands) Parent Total Total Non Other The Net sales $ — $ 40,588 $ 81,600 $ (7,223 ) $ 114,965 Costs and expenses: Cost of products sold — 28,296 50,259 (7,127 ) 71,428 Selling 305 5,011 10,405 — 15,721 General and administrative 2,691 923 7,893 — 11,507 Research and development 380 1,091 469 — 1,940 Restructuring 428 1,028 1,376 — 2,832 3,804 36,349 70,402 (7,127 ) 103,428 (Loss) income from operations (3,804 ) 4,239 11,198 (96 ) 11,537 Interest (expense) income, net (9,714 ) 517 (1,144 ) — (10,341 ) Foreign exchange gain (loss) 17 (54 ) 61 — 24 Equity in subsidiaries income 9,102 7,804 — (16,906 ) — Dividend income 3,145 — — (3,145 ) — (Loss) income before provision for income taxes (1,254 ) 12,506 10,115 (20,147 ) 1,220 Provision for income taxes (191 ) (2 ) (2,472 ) — (2,665 ) Net (loss) income $ (1,445 ) $ 12,504 $ 7,643 $ (20,147 ) $ (1,445 ) Comprehensive (loss) income $ (606 ) $ 12,494 $ 15,632 $ (20,147 ) $ 7,373 |
Consolidating Statement of Cash Flows (Unaudited) | Xerium Technologies, Inc. Consolidating Statement of Cash Flows-(Unaudited) For the three months ended March 31, 2017 (Dollars in thousands) Parent Total Total Non Other The Operating activities Net (loss) income $ (2,834 ) $ 16,222 $ 4,994 $ (21,216 ) $ (2,834 ) Adjustments to reconcile net (loss) income to net cash(used in) provided by operating activities: Stock-based compensation 531 — — — 531 Depreciation 579 2,069 5,171 — 7,819 Amortization of intangible assets — 246 27 — 273 Deferred financing cost amortization 875 — 24 — 899 Foreign exchange gain on revaluation of debt 625 — 2 — 627 Deferred taxes (321 ) — 331 — 10 Loss on disposition of property and equipment — (37 ) (12 ) — (49 ) Loss on extinguishment of debt 25 — — — 25 Provision for doubtful accounts — (15 ) 56 — 41 Undistributed equity in earnings of subsidiaries (8,714 ) (4,381 ) — 13,095 — Change in assets and liabilities which (used) provided cash: Accounts receivable (8 ) (2,981 ) (1,164 ) — (4,153 ) Inventories — 62 (1,198 ) — (1,136 ) Prepaid expenses (226 ) 289 720 — 783 Other current assets — (117 ) (1,668 ) — (1,785 ) Accounts payable and accrued expenses (14,965 ) 443 7,188 — (7,334 ) Deferred and other long-term liabilities (47 ) 169 (1,062 ) — (940 ) Intercompany loans 17,832 (9,010 ) (8,822 ) — — Net cash (used in) provided by operating activities (6,648 ) 2,959 4,587 (8,121 ) (7,223 ) Investing activities Capital expenditures (158 ) (167 ) (4,960 ) — (5,285 ) Intercompany property and equipment transfers, net — 29 (29 ) — — Proceeds from disposals of property and equipment — 211 5 — 216 Net cash (used in) provided by investing activities (158 ) 73 (4,984 ) — (5,069 ) Financing activities Proceeds from borrowings 36,253 — 4,223 — 40,476 Principal payments on debt (25,730 ) — (3,963 ) — (29,693 ) Dividends paid — (4,263 ) (3,858 ) 8,121 — Payment of obligations under capital leases (656 ) (721 ) (143 ) — (1,520 ) Payment of financing fees (187 ) — 17 — (170 ) Intercompany loans (2,186 ) 1,739 447 — — Net cash provided by (used in) financing activities 7,494 (3,245 ) (3,277 ) 8,121 9,093 Effect of exchange rate changes on cash flows — — 529 — 529 Net increase (decrease) in cash 688 (213 ) (3,145 ) — (2,670 ) Cash and cash equivalents at beginning of period $ 1,368 $ 279 $ 11,161 $ — $ 12,808 Cash and cash equivalents at end of period $ 2,056 $ 66 $ 8,016 $ — $ 10,138 Xerium Technologies, Inc. Consolidating Statement of Cash Flows (Unaudited) For the three months ended March 31, 2016 (Dollars in Thousands) Parent Total Total Non Other The Operating activities Net (loss) income $ (1,445 ) $ 12,504 $ 7,643 $ (20,147 ) $ (1,445 ) Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: Stock-based compensation 603 — (11 ) — 592 Depreciation 555 2,053 5,292 — 7,900 Amortization of intangible assets — 69 25 — 94 Deferred financing cost amortization 732 — 24 — 756 Foreign exchange gain on revaluation of debt 1,120 — — — 1,120 Deferred taxes 173 — (18 ) — 155 Asset impairment — — — — — Loss on disposition of property and equipment — — 17 — 17 Provision for doubtful accounts — — (72 ) — (72 ) Undistributed equity in earnings of subsidiaries (9,102 ) (7,804 ) — 16,906 — Change in assets and liabilities which (used) provided cash: Accounts receivable (555 ) 842 (2,417 ) — (2,130 ) Inventories — 1,229 907 96 2,232 Prepaid expenses (872 ) 170 81 — (621 ) Other current assets — 167 857 — 1,024 Accounts payable and accrued expenses 6,459 (932 ) (838 ) — 4,689 Deferred and other long-term liabilities 3 379 410 — 792 Intercompany loans 1,925 (4,721 ) 2,796 — — Net cash (used in) provided by operating activities (404 ) 3,956 14,696 (3,145 ) 15,103 Investing activities Capital expenditures (117 ) (938 ) (2,495 ) — (3,550 ) Intercompany property and equipment transfers, net (2 ) 2 — — — Proceeds from disposals of property and equipment — 5 15 — 20 Net cash (used in) investing activities (119 ) (931 ) (2,480 ) — (3,530 ) Financing activities Proceeds from borrowings 10,992 — 2,321 — 13,313 Principal payments on debt (11,547 ) — (4,892 ) — (16,439 ) Dividends paid — (3,145 ) — 3,145 — Payments of obligations under capitalized leases (67 ) (517 ) (89 ) — (673 ) Payment of deferred financing fees (116 ) — 18 — (98 ) Intercompany loans 1,247 637 (1,884 ) — — Employee taxes paid on equity awards (1,029 ) — — — (1,029 ) Net cash (used in) provided by financing activities (520 ) (3,025 ) (4,526 ) 3,145 (4,926 ) Effect of exchange rate changes on cash flows — — (1,036 ) — (1,036 ) Net (decrease) increase in cash (1,043 ) — 6,654 — 5,611 Cash and cash equivalents at beginning of period 3,105 (2 ) 6,736 — 9,839 Cash and cash equivalents at end of period $ 2,062 $ (2 ) $ 13,390 $ — $ 15,450 |
Description of Business and S29
Description of Business and Significant Accounting Policies - Components of Inventories (Detail) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Raw materials | $ 14,706 | $ 14,089 |
Work in process | 27,205 | 25,879 |
Finished goods (includes consigned inventory of $6,985 at March 31, 2017 and $6,673 at December 31, 2016) | 38,866 | 37,155 |
Inventory allowances | (6,780) | (6,301) |
Inventories, net | 73,997 | 70,822 |
Consigned inventory | $ 6,985 | $ 6,673 |
Description of Business and S30
Description of Business and Significant Accounting Policies - Changes In Warranty Liability (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Warranties, Increase (Decrease) | ||
Beginning Balance | $ 2,203 | $ 2,175 |
Charged to Cost of Sales | 235 | 477 |
Effect of Foreign Currency Translation | 30 | 34 |
Deduction from Reserves | (179) | (189) |
Ending Balance | $ 2,289 | $ 2,497 |
Description of Business and S31
Description of Business and Significant Accounting Policies - Net (Loss) Income (Loss) Per Common Share (Detail) - shares | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Weighted-average common shares outstanding–basic (in shares) | 16,153,113 | 15,789,991 |
Dilutive effect of stock-based compensation awards outstanding (in shares) | 0 | 0 |
Weighted-average common shares outstanding–diluted (in shares) | 16,153,113 | 15,789,991 |
Anti-dilutive securities (in shares) | 902,988 | 738,294 |
Description of Business and S32
Description of Business and Significant Accounting Policies - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||
Employee taxes paid on equity awards | $ 0 | $ 1,029,000 |
Restructuring Expense | ||
Restructuring Cost and Reserve [Line Items] | ||
Asset impairment | $ 0 | 0 |
Accounting Standards Update 2016-09 | New Accounting Pronouncement, Early Adoption, Effect | ||
Restructuring Cost and Reserve [Line Items] | ||
Employee taxes paid on equity awards | $ 1,000,000 |
Business Acquisitions (Details)
Business Acquisitions (Details) - USD ($) $ in Thousands | May 04, 2016 | Mar. 31, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | |||
Goodwill | $ 58,064 | $ 56,783 | |
J.J. Plank Corporation | |||
Business Acquisition [Line Items] | |||
Purchase price | $ 17,600 | ||
Net assets acquired excluding goodwill | 15,700 | ||
Goodwill | $ 1,900 |
Derivatives and Hedging - Narra
Derivatives and Hedging - Narrative (Details) | Mar. 31, 2017derivative_instrument |
Designated as Hedging Instrument | Interest Rate Swap | |
Derivative [Line Items] | |
Number of derivative instruments | 0 |
Derivatives and Hedging - Sched
Derivatives and Hedging - Schedule of Derivative Instruments (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Derivative [Line Items] | |||
Change in fair value of derivative included in foreign exchange (loss) gain | $ 145 | $ 1,170 | |
Not Designated as Hedging Instrument | Foreign Exchange Forward Contracts | |||
Derivative [Line Items] | |||
Fair value of derivative (liability) | $ (79) | $ (1,461) |
Derivatives and Hedging - Notio
Derivatives and Hedging - Notional Amounts of Foreign Exchange Forward Contracts (Detail) - Not Designated as Hedging Instrument - Foreign Exchange Forward Contracts $ in Thousands | Mar. 31, 2017USD ($) |
Notional Sold | |
Derivative [Line Items] | |
Non-designated hedges of foreign exchange risk | $ 0 |
Notional Purchased | |
Derivative [Line Items] | |
Non-designated hedges of foreign exchange risk | $ (987) |
Long term Debt - Schedule of Lo
Long term Debt - Schedule of Long Term Debt (Detail) - USD ($) $ in Thousands | Aug. 09, 2016 | Mar. 31, 2017 | Dec. 31, 2016 | May 17, 2013 |
Debt Instrument [Line Items] | ||||
Long-term debt | $ 499,800 | |||
Notes payable | 7,596 | $ 7,328 | ||
Total debt (excluding long-term capital leases and deferred finance fees) | 516,779 | 505,287 | ||
Less deferred financing costs and debt discount | (15,799) | (16,436) | ||
Less current maturities of long term debt and notes payable | (16,999) | (15,928) | ||
Total long term debt | 483,981 | 472,923 | ||
Other debt | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 21,593 | $ 10,448 | ||
Notes Payable | ||||
Debt Instrument [Line Items] | ||||
Debt instrument variable interest rate (percent) | 2.05% | 2.05% | ||
Rollover option period (years) | 1 year | 1 year | ||
Notes Payable | Notes payable, working capital loan, variable interest rate at 2.05%. Matures June 30, 2017, with one-year rollover option. | ||||
Debt Instrument [Line Items] | ||||
Notes payable | $ 7,596 | $ 7,328 | ||
Senior Secured Term Loan Facility | Notes (Secured), payable semi-annually–U.S. Dollar denominated interest rate fixed at 9.50%. Sold at a price equal to 98.54% of their face value. Matures August of 2021. | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 480,000 | $ 480,000 | ||
Debt instrument interest rate (percent) | 9.50% | 9.50% | 9.50% | |
Redemption price (percent) | 98.54% | 98.54% | 98.54% | |
Senior Secured Term Loan Facility | Senior secured term loan facility, payable quarterly, U.S. Dollar denominated–LIBOR (minimum 1.25%) plus 5.0% (6.25%) net of $0.6 million discount. Matures May of 2019. | ||||
Debt Instrument [Line Items] | ||||
Debt discount | $ 1,000 | |||
Senior Notes (Unsecured) | Senior Notes (Unsecured), payable semi-annually–U.S. Dollar denominated interest rate fixed at 8.875%. Matures June of 2018. | ||||
Debt Instrument [Line Items] | ||||
Redemption price (percent) | 102.219% | |||
Debt instrument fixed interest rate (percent) | 8.875% | |||
Capital Lease Obligations | Fixed asset loan contract, variable interest rate of 5.78%. Matures June of 2020. | ||||
Debt Instrument [Line Items] | ||||
Fixed asset loan | $ 7,590 | $ 7,511 | ||
Debt instrument interest rate (percent) | 5.78% | 5.78% |
Long term Debt - Additional Inf
Long term Debt - Additional Information (Detail) | Aug. 09, 2016USD ($) | Jul. 17, 2015USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Aug. 18, 2016USD ($) | Jul. 17, 2015CNY (¥) | Mar. 03, 2014USD ($) | May 17, 2013USD ($) | May 26, 2011USD ($) |
Debt Instrument [Line Items] | |||||||||
Carrying value of long-term debt | $ 499,800,000 | ||||||||
Fair value of long-term debt | 510,000,000 | ||||||||
Liabilities under capital leases | $ 18,216,000 | $ 19,236,000 | |||||||
Senior secured term loan facility, payable quarterly, U.S. Dollar denominated–LIBOR (minimum 1.25%) plus 5.0% (6.25%) net of $0.6 million discount. Matures May of 2019. | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, face amount | $ 230,000,000 | $ 200,000,000 | |||||||
Debt discount | 1,000,000 | ||||||||
Senior Notes (Unsecured), payable semi-annually–U.S. Dollar denominated interest rate fixed at 8.875%. Matures June of 2018. | Senior Notes (Unsecured) | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, face amount | $ 240,000,000 | ||||||||
Redemption price (percent) | 102.219% | ||||||||
Debt instrument fixed interest rate (percent) | 8.875% | ||||||||
ABL Secured Facility | Revolving Credit Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Remaining borrowing capacity | $ 25,300,000 | ||||||||
Line of credit capacity | 55,000,000 | ||||||||
Amount outstanding | 39,400,000 | ||||||||
Current borrowing capacity | $ 55,000,000 | $ 40,000,000 | |||||||
ABL Secured Facility | Letter of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Amount outstanding | 14,100,000 | ||||||||
Other Small Lines of Credit | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Remaining borrowing capacity | $ 3,200,000 | ||||||||
Xerium China Loan Agreement | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, face amount | $ 9,400,000 | ¥ 58,500,000 | |||||||
Interest rate adjustment period (months) | 12 months | ||||||||
Frequency of principal payment (months) | 6 months | ||||||||
Notes (Secured), payable semi-annually–U.S. Dollar denominated interest rate fixed at 9.50%. Sold at a price equal to 98.54% of their face value. Matures August of 2021. | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, face amount | $ 480,000,000 | ||||||||
Debt instrument interest rate (percent) | 9.50% | 9.50% | 9.50% | ||||||
Redemption price (percent) | 98.54% | 98.54% | 98.54% | ||||||
Carrying value of long-term debt | $ 480,000,000 | $ 480,000,000 | |||||||
Prime Rate | ABL Secured Facility | Revolving Credit Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument interest rate (percent) | 4.75% | ||||||||
Debt instrument, basis spread on variable rate (percent) | 0.75% | ||||||||
London Interbank Offered Rate (LIBOR) | ABL Secured Facility | Revolving Credit Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument interest rate (percent) | 2.78% | ||||||||
Debt instrument, basis spread on variable rate (percent) | 1.75% | ||||||||
Benchmark Rate | Xerium China Loan Agreement | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate during period (percent) | 5.80% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Taxes [Line Items] | ||
Provision for income taxes | $ 2,681 | $ 2,665 |
Net earnings required to recognize deferred tax asset, minimum | 40,000 | |
Net earnings required to recognize deferred tax asset, maximum | 130,000 | |
Gross unrecognized tax benefit | 9,700 | |
Increase in unrecognized tax benefits | 400 | |
Unrecognized tax benefits related to income tax matters and income tax expense | $ 400 | |
Minimum | ||
Income Taxes [Line Items] | ||
Statutory income tax rate in foreign countries (percent) | 15.00% | |
Maximum | ||
Income Taxes [Line Items] | ||
Statutory income tax rate in foreign countries (percent) | 35.36% |
Pensions, Other Post-retireme40
Pensions, Other Post-retirement and Post-employment Benefits - Components of Net Periodic Benefit Cost (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Pensions, Other Post-Retirement And Post-Employment Benefits [Abstract] | ||
Service cost | $ 376 | $ 405 |
Interest cost | 1,267 | 1,485 |
Expected return on plan assets | (1,496) | (1,548) |
Amortization of net loss | 590 | 558 |
Net periodic benefit cost | $ 737 | $ 900 |
Comprehensive Income and Accu41
Comprehensive Income and Accumulated Other Comprehensive Loss - Components of Comprehensive Loss, Net of Tax (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Comprehensive Income Loss and Accumulated Other Comprehensive Income (Loss) [Abstract] | ||
Other comprehensive loss, tax (benefit) expense | $ 109 | $ 67 |
Net loss | (2,834) | (1,445) |
Foreign currency translation adjustments | 9,765 | 8,460 |
Pension liability changes under Topic 715 | (125) | 358 |
Comprehensive income | $ 6,806 | $ 7,373 |
Comprehensive Income and Accu42
Comprehensive Income and Accumulated Other Comprehensive Loss - Components of Accumulated Other Comprehensive Loss (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Accumulated other comprehensive loss, tax benefit | $ 5,900 |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at beginning | (146,905) |
Amounts reclassified from other comprehensive loss: | |
Balance at end | (139,568) |
Foreign Currency Translation Adjustment | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at beginning | (95,232) |
Other comprehensive income before reclassifications | 9,765 |
Amounts reclassified from other comprehensive loss: | |
Amortization of actuarial losses | 0 |
Net current period other comprehensive (loss) income | 9,765 |
Balance at end | (85,467) |
Pension Liability Changes Under Topic 715 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at beginning | (39,446) |
Other comprehensive income before reclassifications | (715) |
Amounts reclassified from other comprehensive loss: | |
Amortization of actuarial losses | 590 |
Net current period other comprehensive (loss) income | (125) |
Balance at end | (39,571) |
Accumulated Other Comprehensive (Loss) Income | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at beginning | (134,678) |
Other comprehensive income before reclassifications | 9,050 |
Amounts reclassified from other comprehensive loss: | |
Amortization of actuarial losses | 590 |
Net current period other comprehensive (loss) income | 9,640 |
Balance at end | $ (125,038) |
Restructuring Expense - Additio
Restructuring Expense - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | $ 3,164 | $ 2,832 |
Headcount Reductions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | 2,100 | |
Clothing Facility | Middletown VA Facility | Facility Closing | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | $ 700 |
Restructuring Expense - Restruc
Restructuring Expense - Restructuring Programs (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Restructuring Reserve | ||
Beginning Balance | $ 4,197 | $ 6,211 |
Charges | 3,164 | 2,832 |
Currency Effects | 152 | 125 |
Cash Payments | (2,041) | (3,675) |
Ending Balance | 5,472 | 5,493 |
Severance and other benefits | ||
Restructuring Reserve | ||
Beginning Balance | 3,805 | 5,308 |
Charges | 2,258 | 1,390 |
Currency Effects | 138 | 62 |
Cash Payments | (1,061) | (1,804) |
Ending Balance | 5,140 | 4,956 |
Facility costs and other | ||
Restructuring Reserve | ||
Beginning Balance | 392 | 903 |
Charges | 906 | 1,442 |
Currency Effects | 14 | 63 |
Cash Payments | (980) | (1,871) |
Ending Balance | $ 332 | $ 537 |
Restructuring Expense - Restr45
Restructuring Expense - Restructuring and Impairment Expense by Segment (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | $ 3,164 | $ 2,832 |
Operating Segments | Clothing | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | 2,476 | 1,452 |
Operating Segments | Roll Covers | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | 627 | 891 |
Corporate | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | $ 61 | $ 489 |
Business Segment Information -
Business Segment Information - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2017segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Business Segment Information 47
Business Segment Information - Summarized Financial Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Segment Reporting Information [Line Items] | ||
Net Sales | $ 119,866 | $ 114,965 |
Segment Earnings (Loss) | 26,573 | 23,935 |
Operating Segments | Clothing | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 72,495 | 71,337 |
Segment Earnings (Loss) | 20,807 | 18,635 |
Operating Segments | Roll Covers | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 47,371 | 43,628 |
Segment Earnings (Loss) | 9,795 | 9,198 |
Corporate | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 0 | 0 |
Segment Earnings (Loss) | $ (4,029) | $ (3,898) |
Business Segment Information 48
Business Segment Information - Reconciliation of Segment Earnings (Loss) To Income Before Provision For Income Taxes (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Segment Earnings (Loss): | ||
Segment Earnings (Loss) | $ 26,573 | $ 23,935 |
Stock-based compensation | (531) | (592) |
Interest expense, net | (13,263) | (10,341) |
Depreciation and amortization | (8,093) | (7,994) |
Loss on extinguishment of debt | (25) | 0 |
Restructuring expense | (3,164) | (2,832) |
Other non-recurring expense | (45) | (103) |
Plant startup costs | (480) | (877) |
Foreign exchange (loss) gain | (1,125) | 24 |
(Loss) income before provision for income taxes | (153) | 1,220 |
Operating Segments | Clothing | ||
Segment Earnings (Loss): | ||
Segment Earnings (Loss) | 20,807 | 18,635 |
Restructuring expense | (2,476) | (1,452) |
Operating Segments | Roll Covers | ||
Segment Earnings (Loss): | ||
Segment Earnings (Loss) | 9,795 | 9,198 |
Restructuring expense | (627) | (891) |
Corporate | ||
Segment Earnings (Loss): | ||
Segment Earnings (Loss) | (4,029) | (3,898) |
Restructuring expense | $ (61) | $ (489) |
Stock-Based Compensation and 49
Stock-Based Compensation and Stockholders' Deficit - Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock compensation expense | $ 531 | $ 592 |
RSU, Options and DSU Awards | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock compensation expense | $ 531 | $ 592 |
Stock-Based Compensation and 50
Stock-Based Compensation and Stockholders' Deficit - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
2015 - 2014 LTIP | Market-Based Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Percentage of award payout (as a percent) | 0.00% | |
Reduction of stock based compensation | $ 200 | |
2011 DSU Plan | Deferred Stock Unit (DSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Annual retainer per director | $ 132 | |
Annual retainer payable in shares (as a percent) | 54.00% | |
Annual retainer payable in shares or cash (as a percent) | 46.00% | |
Shares issued (in shares) | 17,787 | |
2011 DSU Plan | Deferred Stock Unit (DSUs) | Common Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares issued (in shares) | 15,003 |
Supplemental Guarantor Financ51
Supplemental Guarantor Financial Information - Consolidating Balance Sheet-(Unaudited) (Detail) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||||
Cash and cash equivalents | $ 10,138 | $ 12,808 | $ 15,450 | $ 9,839 |
Accounts receivable, net | 74,666 | 68,667 | ||
Intercompany receivables | 0 | 0 | ||
Inventories, net | 73,997 | 70,822 | ||
Prepaid expenses | 5,658 | 6,325 | ||
Other current assets | 17,733 | 15,784 | ||
Total current assets | 182,192 | 174,406 | ||
Property and equipment, net | 288,009 | 284,101 | ||
Investments | 0 | 0 | ||
Goodwill | 58,064 | 56,783 | ||
Intangible assets | 7,694 | 7,330 | ||
Non-current deferred tax asset | 12,810 | 10,737 | ||
Other assets | 8,350 | 8,556 | ||
Total assets | 557,119 | 541,913 | ||
Current liabilities: | ||||
Notes payable | 7,596 | 7,328 | ||
Accounts payable | 42,261 | 36,158 | ||
Accrued expenses | 52,549 | 64,532 | ||
Current maturities of long-term debt | 9,403 | 8,600 | ||
Total current liabilities | 111,809 | 116,618 | ||
Long-term debt, net of current maturities | 483,981 | 472,923 | ||
Liabilities under capital leases | 18,216 | 19,236 | ||
Non-current deferred tax liability | 8,442 | 7,157 | ||
Pension, other post-retirement and post-employment obligations | 65,183 | 65,026 | ||
Other long-term liabilities | 9,056 | 7,858 | ||
Intercompany loans | 0 | 0 | ||
Total stockholders’ (deficit) equity | (139,568) | (146,905) | ||
Total liabilities and stockholders’ deficit | 557,119 | 541,913 | ||
Other Eliminations | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 0 | 0 | ||
Intercompany receivables | 0 | 0 | ||
Inventories, net | (1,111) | (1,111) | ||
Prepaid expenses | 0 | 0 | ||
Other current assets | 0 | 0 | ||
Total current assets | (1,111) | (1,111) | ||
Property and equipment, net | 0 | 0 | ||
Investments | (1,109,666) | (1,081,405) | ||
Goodwill | 0 | 0 | ||
Intangible assets | 0 | 0 | ||
Non-current deferred tax asset | 0 | 0 | ||
Other assets | 0 | 0 | ||
Total assets | (1,110,777) | (1,082,516) | ||
Current liabilities: | ||||
Notes payable | 0 | 0 | ||
Accounts payable | 0 | 0 | ||
Accrued expenses | 0 | 0 | ||
Current maturities of long-term debt | 0 | 0 | ||
Total current liabilities | 0 | 0 | ||
Long-term debt, net of current maturities | 0 | 0 | ||
Liabilities under capital leases | 0 | 0 | ||
Non-current deferred tax liability | 0 | 0 | ||
Pension, other post-retirement and post-employment obligations | 0 | 0 | ||
Other long-term liabilities | 0 | 0 | ||
Intercompany loans | 0 | 0 | ||
Total stockholders’ (deficit) equity | (1,110,777) | (1,082,516) | ||
Total liabilities and stockholders’ deficit | (1,110,777) | (1,082,516) | ||
Parent | ||||
Current assets: | ||||
Cash and cash equivalents | 2,056 | 1,368 | 2,062 | 3,105 |
Accounts receivable, net | 78 | 70 | ||
Intercompany receivables | (428,202) | (410,370) | ||
Inventories, net | 0 | 0 | ||
Prepaid expenses | 771 | 545 | ||
Other current assets | 0 | 0 | ||
Total current assets | (425,297) | (408,387) | ||
Property and equipment, net | 8,069 | 8,393 | ||
Investments | 878,223 | 869,508 | ||
Goodwill | 0 | 0 | ||
Intangible assets | 0 | 0 | ||
Non-current deferred tax asset | 0 | 0 | ||
Other assets | 0 | 0 | ||
Total assets | 460,995 | 469,514 | ||
Current liabilities: | ||||
Notes payable | 0 | 0 | ||
Accounts payable | 2,026 | 2,279 | ||
Accrued expenses | 11,894 | 26,495 | ||
Current maturities of long-term debt | 2,428 | 2,342 | ||
Total current liabilities | 16,348 | 31,116 | ||
Long-term debt, net of current maturities | 475,627 | 464,494 | ||
Liabilities under capital leases | 5,281 | 5,830 | ||
Non-current deferred tax liability | 1,301 | 1,270 | ||
Pension, other post-retirement and post-employment obligations | 20,258 | 20,923 | ||
Other long-term liabilities | 0 | 0 | ||
Intercompany loans | 63,376 | 63,923 | ||
Total stockholders’ (deficit) equity | (121,196) | (118,042) | ||
Total liabilities and stockholders’ deficit | 460,995 | 469,514 | ||
Total Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 66 | 279 | (2) | (2) |
Accounts receivable, net | 21,783 | 18,787 | ||
Intercompany receivables | 428,150 | 419,192 | ||
Inventories, net | 17,295 | 17,356 | ||
Prepaid expenses | 105 | 395 | ||
Other current assets | 3,896 | 3,842 | ||
Total current assets | 471,295 | 459,851 | ||
Property and equipment, net | 66,229 | 67,794 | ||
Investments | 231,443 | 211,897 | ||
Goodwill | 19,614 | 19,614 | ||
Intangible assets | 7,019 | 7,265 | ||
Non-current deferred tax asset | 0 | 0 | ||
Other assets | (121) | 0 | ||
Total assets | 795,479 | 766,421 | ||
Current liabilities: | ||||
Notes payable | 0 | 0 | ||
Accounts payable | 12,048 | 10,307 | ||
Accrued expenses | 7,363 | 8,659 | ||
Current maturities of long-term debt | 2,606 | 2,320 | ||
Total current liabilities | 22,017 | 21,286 | ||
Long-term debt, net of current maturities | 0 | 0 | ||
Liabilities under capital leases | 4,093 | 4,627 | ||
Non-current deferred tax liability | 0 | 0 | ||
Pension, other post-retirement and post-employment obligations | 811 | 763 | ||
Other long-term liabilities | 1,250 | 1,250 | ||
Intercompany loans | (99,159) | (97,953) | ||
Total stockholders’ (deficit) equity | 866,467 | 836,448 | ||
Total liabilities and stockholders’ deficit | 795,479 | 766,421 | ||
Total Non Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 8,016 | 11,161 | $ 13,390 | $ 6,736 |
Accounts receivable, net | 52,805 | 49,810 | ||
Intercompany receivables | 52 | (8,822) | ||
Inventories, net | 57,813 | 54,577 | ||
Prepaid expenses | 4,782 | 5,385 | ||
Other current assets | 13,837 | 11,942 | ||
Total current assets | 137,305 | 124,053 | ||
Property and equipment, net | 213,711 | 207,914 | ||
Investments | 0 | 0 | ||
Goodwill | 38,450 | 37,169 | ||
Intangible assets | 675 | 65 | ||
Non-current deferred tax asset | 12,810 | 10,737 | ||
Other assets | 8,471 | 8,556 | ||
Total assets | 411,422 | 388,494 | ||
Current liabilities: | ||||
Notes payable | 7,596 | 7,328 | ||
Accounts payable | 28,187 | 23,572 | ||
Accrued expenses | 33,292 | 29,378 | ||
Current maturities of long-term debt | 4,369 | 3,938 | ||
Total current liabilities | 73,444 | 64,216 | ||
Long-term debt, net of current maturities | 8,354 | 8,429 | ||
Liabilities under capital leases | 8,842 | 8,779 | ||
Non-current deferred tax liability | 7,141 | 5,887 | ||
Pension, other post-retirement and post-employment obligations | 44,114 | 43,340 | ||
Other long-term liabilities | 7,806 | 6,608 | ||
Intercompany loans | 35,783 | 34,030 | ||
Total stockholders’ (deficit) equity | 225,938 | 217,205 | ||
Total liabilities and stockholders’ deficit | $ 411,422 | $ 388,494 |
Supplemental Guarantor Financ52
Supplemental Guarantor Financial Information - Consolidating Statement of Operations and Comprehensive (Loss) Income (Unaudited) (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Condensed Income Statements, Captions [Line Items] | ||
Net Sales | $ 119,866 | $ 114,965 |
Costs and expenses: | ||
Cost of products sold | 72,370 | 71,428 |
Selling | 15,674 | 15,721 |
General and administrative | 12,654 | 11,507 |
Research and development | 1,744 | 1,940 |
Restructuring | 3,164 | 2,832 |
Costs and expenses | 105,606 | 103,428 |
(Loss) income from operations | 14,260 | 11,537 |
Interest (expense) income, net | (13,263) | (10,341) |
Foreign exchange gain (loss) | (1,125) | 24 |
Equity in subsidiaries income | 0 | 0 |
Loss on extinguishment of debt | 25 | 0 |
Dividend income | 0 | 0 |
(Loss) income before provision for income taxes | (153) | 1,220 |
Provision for income taxes | (2,681) | (2,665) |
Net loss | (2,834) | (1,445) |
Comprehensive income | 6,806 | 7,373 |
Other Eliminations | ||
Condensed Income Statements, Captions [Line Items] | ||
Net Sales | (8,163) | (7,223) |
Costs and expenses: | ||
Cost of products sold | (8,163) | (7,127) |
Selling | 0 | 0 |
General and administrative | 0 | 0 |
Research and development | 0 | 0 |
Restructuring | 0 | 0 |
Costs and expenses | (8,163) | (7,127) |
(Loss) income from operations | 0 | (96) |
Interest (expense) income, net | 0 | 0 |
Foreign exchange gain (loss) | 0 | 0 |
Equity in subsidiaries income | (13,095) | (16,906) |
Loss on extinguishment of debt | 0 | |
Dividend income | (8,121) | (3,145) |
(Loss) income before provision for income taxes | (21,216) | (20,147) |
Provision for income taxes | 0 | 0 |
Net loss | (21,216) | (20,147) |
Comprehensive income | (21,216) | (20,147) |
Parent | ||
Condensed Income Statements, Captions [Line Items] | ||
Net Sales | 0 | 0 |
Costs and expenses: | ||
Cost of products sold | 0 | 0 |
Selling | 233 | 305 |
General and administrative | 2,702 | 2,691 |
Research and development | 299 | 380 |
Restructuring | 61 | 428 |
Costs and expenses | 3,295 | 3,804 |
(Loss) income from operations | (3,295) | (3,804) |
Interest (expense) income, net | (12,338) | (9,714) |
Foreign exchange gain (loss) | (472) | 17 |
Equity in subsidiaries income | 8,714 | 9,102 |
Loss on extinguishment of debt | 25 | |
Dividend income | 4,263 | 3,145 |
(Loss) income before provision for income taxes | (3,153) | (1,254) |
Provision for income taxes | 319 | (191) |
Net loss | (2,834) | (1,445) |
Comprehensive income | (3,684) | (606) |
Total Guarantors | ||
Condensed Income Statements, Captions [Line Items] | ||
Net Sales | 46,945 | 40,588 |
Costs and expenses: | ||
Cost of products sold | 30,948 | 28,296 |
Selling | 5,044 | 5,011 |
General and administrative | 974 | 923 |
Research and development | 931 | 1,091 |
Restructuring | 642 | 1,028 |
Costs and expenses | 38,539 | 36,349 |
(Loss) income from operations | 8,406 | 4,239 |
Interest (expense) income, net | (347) | 517 |
Foreign exchange gain (loss) | 65 | (54) |
Equity in subsidiaries income | 4,381 | 7,804 |
Loss on extinguishment of debt | 0 | |
Dividend income | 3,858 | 0 |
(Loss) income before provision for income taxes | 16,363 | 12,506 |
Provision for income taxes | (141) | (2) |
Net loss | 16,222 | 12,504 |
Comprehensive income | 16,230 | 12,494 |
Total Non Guarantors | ||
Condensed Income Statements, Captions [Line Items] | ||
Net Sales | 81,084 | 81,600 |
Costs and expenses: | ||
Cost of products sold | 49,585 | 50,259 |
Selling | 10,397 | 10,405 |
General and administrative | 8,978 | 7,893 |
Research and development | 514 | 469 |
Restructuring | 2,461 | 1,376 |
Costs and expenses | 71,935 | 70,402 |
(Loss) income from operations | 9,149 | 11,198 |
Interest (expense) income, net | (578) | (1,144) |
Foreign exchange gain (loss) | (718) | 61 |
Equity in subsidiaries income | 0 | 0 |
Loss on extinguishment of debt | 0 | |
Dividend income | 0 | 0 |
(Loss) income before provision for income taxes | 7,853 | 10,115 |
Provision for income taxes | (2,859) | (2,472) |
Net loss | 4,994 | 7,643 |
Comprehensive income | $ 15,476 | $ 15,632 |
Supplemental Guarantor Financ53
Supplemental Guarantor Financial Information - Consolidating Statement of Cash Flows (Unaudited) (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Operating activities | ||
Net loss | $ (2,834) | $ (1,445) |
Adjustments to reconcile net (loss) income to net cash(used in) provided by operating activities: | ||
Stock-based compensation | 531 | 592 |
Depreciation | 7,819 | 7,900 |
Amortization of intangible assets | 273 | 94 |
Deferred financing cost amortization | 899 | 756 |
Foreign exchange gain on revaluation of debt | 627 | 1,120 |
Deferred taxes | 10 | 155 |
Asset impairment | 0 | |
(Gain) loss on disposition of property and equipment | (49) | 17 |
Loss on extinguishment of debt | 25 | 0 |
Provision (benefit) for doubtful accounts | 41 | (72) |
Undistributed equity in earnings of subsidiaries | 0 | 0 |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | (4,153) | (2,130) |
Inventories | (1,136) | 2,232 |
Prepaid expenses | 783 | (621) |
Other current assets | (1,785) | 1,024 |
Accounts payable and accrued expenses | (7,334) | 4,689 |
Deferred and other long-term liabilities | (940) | 792 |
Intercompany loans | 0 | 0 |
Net cash (used in) provided by operating activities | (7,223) | 15,103 |
Investing activities | ||
Capital expenditures | (5,285) | (3,550) |
Intercompany property and equipment transfers, net | 0 | 0 |
Proceeds from disposals of property and equipment | 216 | 20 |
Net cash used in investing activities | (5,069) | (3,530) |
Financing activities | ||
Proceeds from borrowings | 40,476 | 13,313 |
Principal payments on debt | (29,693) | (16,439) |
Dividends paid | 0 | 0 |
Payment of obligations under capital leases | (1,520) | (673) |
Payment of financing fees | (170) | (98) |
Intercompany loans | 0 | 0 |
Employee taxes paid on equity awards | 0 | (1,029) |
Net cash provided by (used in) financing activities | 9,093 | (4,926) |
Effect of exchange rate changes on cash flows | 529 | (1,036) |
Net increase (decrease) in cash | (2,670) | 5,611 |
Cash and cash equivalents at beginning of period | 12,808 | 9,839 |
Cash and cash equivalents at end of period | 10,138 | 15,450 |
Other Eliminations | ||
Operating activities | ||
Net loss | (21,216) | (20,147) |
Adjustments to reconcile net (loss) income to net cash(used in) provided by operating activities: | ||
Stock-based compensation | 0 | 0 |
Depreciation | 0 | 0 |
Amortization of intangible assets | 0 | 0 |
Deferred financing cost amortization | 0 | 0 |
Foreign exchange gain on revaluation of debt | 0 | 0 |
Deferred taxes | 0 | 0 |
Asset impairment | 0 | |
(Gain) loss on disposition of property and equipment | 0 | 0 |
Loss on extinguishment of debt | 0 | |
Provision (benefit) for doubtful accounts | 0 | 0 |
Undistributed equity in earnings of subsidiaries | 13,095 | 16,906 |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | 0 | 0 |
Inventories | 0 | 96 |
Prepaid expenses | 0 | 0 |
Other current assets | 0 | 0 |
Accounts payable and accrued expenses | 0 | 0 |
Deferred and other long-term liabilities | 0 | 0 |
Intercompany loans | 0 | 0 |
Net cash (used in) provided by operating activities | (8,121) | (3,145) |
Investing activities | ||
Capital expenditures | 0 | 0 |
Intercompany property and equipment transfers, net | 0 | 0 |
Proceeds from disposals of property and equipment | 0 | 0 |
Net cash used in investing activities | 0 | 0 |
Financing activities | ||
Proceeds from borrowings | 0 | 0 |
Principal payments on debt | 0 | 0 |
Dividends paid | 8,121 | 3,145 |
Payment of obligations under capital leases | 0 | 0 |
Payment of financing fees | 0 | 0 |
Intercompany loans | 0 | 0 |
Employee taxes paid on equity awards | 0 | |
Net cash provided by (used in) financing activities | 8,121 | 3,145 |
Effect of exchange rate changes on cash flows | 0 | 0 |
Net increase (decrease) in cash | 0 | 0 |
Cash and cash equivalents at beginning of period | 0 | 0 |
Cash and cash equivalents at end of period | 0 | 0 |
Parent | ||
Operating activities | ||
Net loss | (2,834) | (1,445) |
Adjustments to reconcile net (loss) income to net cash(used in) provided by operating activities: | ||
Stock-based compensation | 531 | 603 |
Depreciation | 579 | 555 |
Amortization of intangible assets | 0 | 0 |
Deferred financing cost amortization | 875 | 732 |
Foreign exchange gain on revaluation of debt | 625 | 1,120 |
Deferred taxes | (321) | 173 |
Asset impairment | 0 | |
(Gain) loss on disposition of property and equipment | 0 | 0 |
Loss on extinguishment of debt | 25 | |
Provision (benefit) for doubtful accounts | 0 | 0 |
Undistributed equity in earnings of subsidiaries | (8,714) | (9,102) |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | (8) | (555) |
Inventories | 0 | 0 |
Prepaid expenses | (226) | (872) |
Other current assets | 0 | 0 |
Accounts payable and accrued expenses | (14,965) | 6,459 |
Deferred and other long-term liabilities | (47) | 3 |
Intercompany loans | 17,832 | 1,925 |
Net cash (used in) provided by operating activities | (6,648) | (404) |
Investing activities | ||
Capital expenditures | (158) | (117) |
Intercompany property and equipment transfers, net | 0 | (2) |
Proceeds from disposals of property and equipment | 0 | 0 |
Net cash used in investing activities | (158) | (119) |
Financing activities | ||
Proceeds from borrowings | 36,253 | 10,992 |
Principal payments on debt | (25,730) | (11,547) |
Dividends paid | 0 | 0 |
Payment of obligations under capital leases | (656) | (67) |
Payment of financing fees | (187) | (116) |
Intercompany loans | (2,186) | 1,247 |
Employee taxes paid on equity awards | (1,029) | |
Net cash provided by (used in) financing activities | 7,494 | (520) |
Effect of exchange rate changes on cash flows | 0 | 0 |
Net increase (decrease) in cash | 688 | (1,043) |
Cash and cash equivalents at beginning of period | 1,368 | 3,105 |
Cash and cash equivalents at end of period | 2,056 | 2,062 |
Total Guarantors | ||
Operating activities | ||
Net loss | 16,222 | 12,504 |
Adjustments to reconcile net (loss) income to net cash(used in) provided by operating activities: | ||
Stock-based compensation | 0 | 0 |
Depreciation | 2,069 | 2,053 |
Amortization of intangible assets | 246 | 69 |
Deferred financing cost amortization | 0 | 0 |
Foreign exchange gain on revaluation of debt | 0 | 0 |
Deferred taxes | 0 | 0 |
Asset impairment | 0 | |
(Gain) loss on disposition of property and equipment | (37) | 0 |
Loss on extinguishment of debt | 0 | |
Provision (benefit) for doubtful accounts | (15) | 0 |
Undistributed equity in earnings of subsidiaries | (4,381) | (7,804) |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | (2,981) | 842 |
Inventories | 62 | 1,229 |
Prepaid expenses | 289 | 170 |
Other current assets | (117) | 167 |
Accounts payable and accrued expenses | 443 | (932) |
Deferred and other long-term liabilities | 169 | 379 |
Intercompany loans | (9,010) | (4,721) |
Net cash (used in) provided by operating activities | 2,959 | 3,956 |
Investing activities | ||
Capital expenditures | (167) | (938) |
Intercompany property and equipment transfers, net | 29 | 2 |
Proceeds from disposals of property and equipment | 211 | 5 |
Net cash used in investing activities | 73 | (931) |
Financing activities | ||
Proceeds from borrowings | 0 | 0 |
Principal payments on debt | 0 | 0 |
Dividends paid | (4,263) | (3,145) |
Payment of obligations under capital leases | (721) | (517) |
Payment of financing fees | 0 | 0 |
Intercompany loans | 1,739 | 637 |
Employee taxes paid on equity awards | 0 | |
Net cash provided by (used in) financing activities | (3,245) | (3,025) |
Effect of exchange rate changes on cash flows | 0 | 0 |
Net increase (decrease) in cash | (213) | 0 |
Cash and cash equivalents at beginning of period | 279 | (2) |
Cash and cash equivalents at end of period | 66 | (2) |
Total Non Guarantors | ||
Operating activities | ||
Net loss | 4,994 | 7,643 |
Adjustments to reconcile net (loss) income to net cash(used in) provided by operating activities: | ||
Stock-based compensation | 0 | (11) |
Depreciation | 5,171 | 5,292 |
Amortization of intangible assets | 27 | 25 |
Deferred financing cost amortization | 24 | 24 |
Foreign exchange gain on revaluation of debt | 2 | 0 |
Deferred taxes | 331 | (18) |
Asset impairment | 0 | |
(Gain) loss on disposition of property and equipment | (12) | 17 |
Loss on extinguishment of debt | 0 | |
Provision (benefit) for doubtful accounts | 56 | (72) |
Undistributed equity in earnings of subsidiaries | 0 | 0 |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | (1,164) | (2,417) |
Inventories | (1,198) | 907 |
Prepaid expenses | 720 | 81 |
Other current assets | (1,668) | 857 |
Accounts payable and accrued expenses | 7,188 | (838) |
Deferred and other long-term liabilities | (1,062) | 410 |
Intercompany loans | (8,822) | 2,796 |
Net cash (used in) provided by operating activities | 4,587 | 14,696 |
Investing activities | ||
Capital expenditures | (4,960) | (2,495) |
Intercompany property and equipment transfers, net | (29) | 0 |
Proceeds from disposals of property and equipment | 5 | 15 |
Net cash used in investing activities | (4,984) | (2,480) |
Financing activities | ||
Proceeds from borrowings | 4,223 | 2,321 |
Principal payments on debt | (3,963) | (4,892) |
Dividends paid | (3,858) | 0 |
Payment of obligations under capital leases | (143) | (89) |
Payment of financing fees | 17 | 18 |
Intercompany loans | 447 | (1,884) |
Employee taxes paid on equity awards | 0 | |
Net cash provided by (used in) financing activities | (3,277) | (4,526) |
Effect of exchange rate changes on cash flows | 529 | (1,036) |
Net increase (decrease) in cash | (3,145) | 6,654 |
Cash and cash equivalents at beginning of period | 11,161 | 6,736 |
Cash and cash equivalents at end of period | $ 8,016 | $ 13,390 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Thousands | Apr. 28, 2017 | Mar. 31, 2017 | Mar. 31, 2016 |
Subsequent Event [Line Items] | |||
Stock compensation expense | $ 531 | $ 592 | |
Director | Subsequent Event | |||
Subsequent Event [Line Items] | |||
Severance costs | $ 1,300 | ||
Severance payment period | 18 months | ||
Stock compensation expense | $ 1,700 |