Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | Apr. 30, 2018 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
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 | 16,427,603 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 9,901 | $ 17,253 |
Accounts receivable, net | 82,473 | 76,633 |
Inventories, net | 76,647 | 74,725 |
Prepaid expenses | 13,685 | 11,335 |
Other current assets | 16,845 | 15,316 |
Total current assets | 199,551 | 195,262 |
Property and equipment, net | 281,442 | 282,378 |
Goodwill | 67,178 | 64,783 |
Intangible assets | 5,658 | 5,965 |
Non-current deferred tax asset | 11,198 | 10,103 |
Other assets | 9,211 | 9,358 |
Total assets | 574,238 | 567,849 |
Current liabilities: | ||
Notes payable | 8,622 | 8,398 |
Accounts payable | 40,256 | 39,856 |
Accrued expenses | 51,082 | 64,155 |
Current maturities of long-term debt | 9,855 | 10,614 |
Total current liabilities | 109,815 | 123,023 |
Long-term debt, net of current maturities | 484,929 | 473,904 |
Liabilities under capital leases | 15,189 | 15,952 |
Non-current deferred tax liability | 13,601 | 12,897 |
Pension, other post-retirement and post-employment obligations | 68,901 | 69,205 |
Other long-term liabilities | 9,944 | 9,334 |
Commitments and contingencies | ||
Stockholders’ deficit | ||
Preferred stock, $0.001 par value, 1,000,000 shares authorized; no shares outstanding as of March 31, 2018 and December 31, 2017 | 0 | 0 |
Common stock, $0.001 par value, 20,000,000 shares authorized; 16,413,179 and 16,367,743 shares outstanding as of March 31, 2018 and December 31, 2017, respectively | 16 | 16 |
Paid-in capital | 432,785 | 432,489 |
Accumulated deficit | (455,814) | (457,712) |
Accumulated other comprehensive loss | (105,128) | (111,259) |
Total stockholders’ deficit | (128,141) | (136,466) |
Total liabilities and stockholders’ deficit | $ 574,238 | $ 567,849 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2018 | Dec. 31, 2017 |
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) | 16,413,179 | 16,367,743 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Statement [Abstract] | ||
Net Sales | $ 126,075 | $ 119,866 |
Costs and expenses: | ||
Cost of products sold | 78,842 | 72,240 |
Selling | 15,677 | 15,674 |
General and administrative | 13,097 | 12,423 |
Research and development | 1,568 | 1,744 |
Restructuring | 824 | 3,164 |
Costs and expenses | 110,008 | 105,245 |
(Loss) income from operations | 16,067 | 14,621 |
Interest expense, net | (12,765) | (13,263) |
Other components of net periodic pension cost | (266) | (361) |
Loss on extinguishment of debt | 0 | (25) |
Foreign exchange gain (loss) | 532 | (1,125) |
Income (loss) before provision for income taxes | 3,568 | (153) |
Provision for income taxes | (1,337) | (2,681) |
Net income (loss) | 2,231 | (2,834) |
Comprehensive income | $ 8,362 | $ 6,806 |
Net income (loss) per share: | ||
Basic (in dollars per share) | $ 0.14 | $ (0.18) |
Diluted (in dollars per share) | $ 0.13 | $ (0.18) |
Shares used in computing net income (loss) per share: | ||
Basic (in shares) | 16,398,076 | 16,153,113 |
Diluted (in shares) | 16,655,850 | 16,153,113 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Operating activities | ||
Net income (loss) | $ 2,231 | $ (2,834) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Stock-based compensation | 355 | 531 |
Depreciation | 7,954 | 7,819 |
Amortization of intangible assets | 307 | 273 |
Deferred financing cost amortization | 932 | 899 |
Foreign exchange (gain) loss on revaluation of debt | (84) | 627 |
Deferred taxes | (204) | 10 |
Gain on disposition of property and equipment | (57) | (49) |
Loss on extinguishment of debt | 0 | 25 |
Provision for doubtful accounts | 305 | 41 |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | (4,583) | (4,153) |
Inventories | (956) | (1,136) |
Prepaid expenses | (2,388) | 783 |
Other current assets | (1,345) | (1,785) |
Accounts payable and accrued expenses | (13,793) | (7,334) |
Deferred and other long-term liabilities | (833) | (940) |
Net cash used in operating activities | (12,159) | (7,223) |
Investing activities | ||
Capital expenditures | (2,510) | (5,285) |
Proceeds from disposals of property and equipment | 88 | 216 |
Net cash used in investing activities | (2,422) | (5,069) |
Financing activities | ||
Proceeds from borrowings | 31,133 | 40,476 |
Principal payments on debt | (22,513) | (29,693) |
Payment of financing fees | 0 | (170) |
Payment of obligations under capital leases | (1,424) | (1,520) |
Employee taxes paid on equity awards | (59) | 0 |
Net cash provided by financing activities | 7,137 | 9,093 |
Effect of exchange rate changes on cash flows | 92 | 529 |
Net decrease in cash | (7,352) | (2,670) |
Cash and cash equivalents at beginning of period | 17,253 | 12,808 |
Cash and cash equivalents at end of period | $ 9,901 | $ 10,138 |
Description of Business and Sig
Description of Business and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2018 | |
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 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, 2018 and for the three months ended March 31, 2018 and 2017 include the accounts of the Company and its wholly-owned subsidiaries. These financial statements 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, 2017 as reported on the Company's Annual Report on Form 10-K filed on February 28, 2018. 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, 2018 December 31, 2017 Raw materials $ 15,128 $ 13,881 Work in process 30,222 27,819 Finished goods (includes consigned inventory of $7,029 at March 31, 2018 and $7,757 at December 31, 2017) 38,074 39,798 Inventory allowances (6,777 ) (6,773 ) $ 76,647 $ 74,725 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, 2018 , 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, 2018 . 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, 2018 and 2017 : Beginning Balance Charged to Cost of Sales Effect of Foreign Currency Translation Deduction from Reserves Ending Balance Three Months Ended March 31, 2018: $ 2,470 $ 359 $ 37 $ (239 ) $ 2,627 Three Months Ended March 31, 2017: $ 2,203 $ 235 $ 30 $ (179 ) $ 2,289 Net Income (Loss) Per Common Share Net income (loss) per common share has been computed and presented pursuant to the provisions of ASC Topic 260, Earnings per Share (“Topic 260”). Net income (loss) per share is based on the weighted-average number of shares outstanding during the period. As of March 31, 2018 and 2017 , the Company had outstanding restricted stock units (“RSUs”) and deferred stock units (“DSUs”). The following table sets forth the computation of basic and diluted weighted-average shares: Three Months Ended March 31, 2018 2017 Weighted-average common shares outstanding–basic 16,398,076 16,153,113 Dilutive effect of stock-based compensation awards outstanding 257,774 — Weighted-average common shares outstanding–diluted 16,655,850 16,153,113 The following table sets forth the aggregate of the dilutive securities that were outstanding in the three months ended March 31, 2018 and 2017 , but were not included in the computation of diluted earnings per share because the impact would have been anti-dilutive or because a contingency for issuance was not yet satisfied in the period: Three Months Ended March 31, 2018 2017 Anti-dilutive securities 686,208 902,988 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, 2018 and 2017 , the Company had no impairment charges included in restructuring expense. Recently Adopted Accounting Pronouncements In March 2018, the FASB issued Accounting Standards Update No 2018-05, Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 (SAB 118). The amendments in ASU 2018-05 codified the amendments from SAB 118 which related to the income tax accounting implications of the Tax Cuts and Jobs Act. The Company already adopted SAB 118 as of December 31, 2017. Refer to Note 5 Income Taxes. In May 2017, the FASB issued Accounting Standards Update No 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting ("ASU 2017-09"). The amendments in ASU 2017-09 provide guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The amendments in ASU 2017-09 are effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period, for (1) public business entities for reporting periods for which financial statements have not yet been issued and (2) all other entities for reporting periods for which financial statements have not yet been made available for issuance. The amendments in this update should be applied prospectively to an award modified on or after the adoption date. The adoption of this guidance effective January 1, 2018 did not have a material impact on the Company's financial statements. 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. The Company elected the practical expedient that allowed it to estimate amounts for comparative periods using the information previously disclosed in its pension and other postretirement benefit plan note which reasonably reflects the effect of the capitalized amount of net periodic benefit cost for the prior comparative periods. The Company adopted this guidance effective January 1, 2018 and, as a result, reclassified $0.4 million of Q1 2017 pension cost (interest cost, expected return on plan assets, and amortization of net loss) out of operating income into other components of net periodic pension cost, a component of non-operating expenses on the consolidated statements of operations. The adoption of this standard did not have a material impact on the Company's net income or financial position. Also, no changes to cash flows resulted from adoption of this standard. 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 adopted this guidance effective January 1, 2018 which resulted in an increase in 2018 opening accumulated deficit of $0.3 million representing the cumulative net impact from (1) the write-off of unamortized tax expense previously deferred in income tax receivable under the previous guidance and (2) recognition of the previously unrecognized deferred tax assets, net of any necessary valuation allowance. The adoption of this standard did not have a material impact on the Company's net income or financial position. Also, no changes to cash flows resulted from adoption of this standard. 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. The adoption of this guidance effective January 1, 2018 did not have a material impact on the Company's 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 adopted this new standard effective January 1, 2018 using the modified retrospective transition method. The adoption of this standard did not result in adjustment to the Company's financial statements. Recently Issued Accounting Pronouncements In February 2018, the FASB issued Accounting Standards Update No 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (ASU 2018-02). The amendments in ASU 2018-02 allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The amendments in this update are effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption of the amendments in this update is permitted, including adoption in any interim period, for public business entities for reporting periods for which financial statements have not yet been issued and for all other entities for reporting periods for which financial statements have not yet been made available for issuance. The Company is in the process of evaluating this accounting standard update. In August 2017, the FASB issued Accounting Standards Update No 2017-12, Derivative and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12). The amendments in ASU 2017-12 provide guidance to better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. To meet that objective, the amendments expand and refine hedge accounting for both nonfinancial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. For public business entities, the amendments in this update are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early application is permitted in any interim period after issuance of the update. 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 February 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 December 15, 2018, and interim periods within those years. For all other entities, it is effective for annual periods beginning after December 15, 2019, and interim periods the following year. Early adoption is permitted for all entities. The Company has commenced a comprehensive project plan to direct the implementation of the new leases standard and an assessment of the impact to business processes. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 3 Months Ended |
Mar. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customers | Revenue from Contracts with Customers The Company operates through two principal business segments, machine clothing and roll covers. The machine clothing segment performance obligations generally include the production of various types of industrial textiles used on paper-making machines and on other industrial applications. In the Company's roll covers segment, the performance obligations generally include the manufacturing of various types of roll covers, spreader rolls, refurbishment of previously installed roll covers, and providing mechanical services for the internal mechanisms of rolls used on paper-making machines. The contract and order economics and risks are determined to be at the segment level. Within each segment the contracts are similar. Total revenues by segment for the reporting periods on the Consolidated Statements of Operations are disclosed in Note 9. Revenue from the Company's performance obligations to customers is recognized at the point in time when control is transferred to the customer. Control is generally transferred to the customer when persuasive evidence of an arrangement exists, the price is fixed and determinable, delivery including transfer of title has occurred and there is a reasonable assurance of collection of the sales proceeds. The Company generally obtains written purchase authorizations from customers for a specific product or service performance obligation at a specified price and considers delivery and transfer of title to have occurred in accordance with its shipping terms. Payment is generally due in accordance with customary payment terms once the transfer of control has occurred. Revenue is recorded net of applicable allowances, including estimated allowances for returns, rebates and other discounts. Allowances are generally estimated based upon customer trends. In the machine clothing segment, a small portion of the business has been conducted pursuant to consignment arrangements under which the Company does not recognize a sale of a product to a customer until the customer places the product into use, which typically occurs some period after the product is shipped to the customer or to a warehouse location near the customer’s facility. As part of the consignment agreement, the Company delivers the goods to a location designated by the customer. In many cases, the customer and the Company generally agree to a “sunset” date, which represents the date by which the customer must accept all risks and rewards of ownership of the product and payment terms begin. For consignment sales, revenue is generally recognized on the earlier of the actual product installation date or the “sunset” date. The costs to fulfill the Company's performance obligations at a point in time are included in inventory. Refer to balances and further discussion in Note 1. Commissions are generally earned at the point in time the performance obligation is satisfied by the Company and are expensed as incurred. Commission expense for the three months ended March 31, 2018 and 2017 was $3.3 million and $3.5 million , respectively. The Company has net accounts receivable balances from customers of $82.5 million and $76.6 million as of March 31, 2018 and December 31, 2017 , respectively. The Company does not have any contract receivable balance as of March 31, 2018 and December 31, 2017 . The Company had minimal contract liability balances which primarily relate to customer prepayments for certain products in its North American rolls business of $0.8 million and $0.5 million as of March 31, 2018 and December 31, 2017 , respectively. The corresponding balances as of March 31, 2017 and December 31, 2016 were $0.6 million and $1.1 million , respectively. Minimal revenue was recognized on these contract liabilities during the three months ended March 31, 2018 and 2017 . |
Derivatives and Hedging
Derivatives and Hedging | 3 Months Ended |
Mar. 31, 2018 | |
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 foreign exchange rates. 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 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, 2018 and December 31, 2017 , 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, 2018 and December 31, 2017 and the change in fair value included in foreign exchange gain in the three months ended March 31, 2018 and 2017 : March 31, 2018 December 31, 2017 Fair value of derivative liability $ (39 ) $ (591 ) Three Months Ended March 31, 2018 Three Months Ended March 31, 2017 Change in fair value of derivative included in foreign exchange gain $ 427 $ 145 The following represents the notional amounts of foreign exchange forward contracts at March 31, 2018 : Notional Sold Notional Purchased Non-designated hedges of foreign exchange risk $ 18,372 $ (24,476 ) 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, 2018 | |
Debt Disclosure [Abstract] | |
Long term Debt | Long term Debt At March 31, 2018 and December 31, 2017 , long term debt consisted of the following: March 31, 2018 December 31, 2017 9.5% Senior Notes due August 2021. $ 480,000 $ 480,000 Capital leases 19,914 20,749 Notes payable, working capital loan, variable interest rate at 1.45%. Matures August 31, 2018, with one-year rollover option. 8,622 8,398 Fixed asset loan contract, variable interest rate of 5.23%. Matures June of 2020. 6,996 6,761 Other debt 15,235 6,062 Total debt 530,767 521,970 Less deferred financing costs and debt discount (12,172 ) (13,102 ) Less current maturities of long term debt and notes payable (18,477 ) (19,012 ) Total long term debt including capital leases $ 500,118 $ 489,856 Balance sheet classification of total long-term debt including capital leases Long-term debt, net of current maturities and deferred financing costs 484,929 473,904 Liabilities under capital lease, non-current 15,189 15,952 Total long term debt including capital leases $ 500,118 $ 489,856 As of March 31, 2018 , the carrying value of the Company’s debt was $518.6 million (excluding deferred financing costs and debt discount) and its fair value was approximately $546.4 million . The Company determined the fair value of its debt utilizing significant other observable inputs (Level 2 of the fair value hierarchy) based on the quoted market prices for the same issues or on the current rates offered for debt of similar remaining maturities and estimates. 9.5% Secured Notes due 2021 On August 9, 2016, the Company issued $480.0 million aggregate principal amount of 9.5% Senior Secured Notes due August 2021 (the "Notes") for a price equal to 98.54% of their face value. Interest payments are due semi-annually in arrears on February 15 and August 15 of each year beginning on February 15, 2017 and the Notes 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 $230.0 million term loan credit facility, to redeem all of its $240.0 million aggregate principal amount 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. ABL Revolving Credit Facility On November 3, 2015, the Company refinanced its prior revolving credit facility by entering into a new Revolving Credit and Guaranty Agreement (the “ABL Facility”) with one of its existing lenders. The amount of the ABL Facility provides an aggregate facility limit of $55.0 million , subject to a borrowing base collateralized by eligible accounts receivable, inventory and equipment of Xerium Technologies, Inc., as a US borrower, Xerium Canada Inc., as Canadian borrower, and Huyck.Wagner Germany GmbH, Robec Walzen GmbH, and Stowe Woodward AG, as the European borrowers. 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, 2018 , these rates were 5.50% and 3.75% , respectively. As of March 31, 2018 , an aggregate of $ 25.4 million was available for additional borrowings under the ABL Facility. This availability represents $ 37.8 million under the ABL currently collateralized by certain assets of the Company, less $ 12.4 million committed for letters of credit or current borrowings. In addition, the Company had approximately $ 6.4 million available for borrowings under other small lines of credit. The Indenture governing the Notes 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. Fixed Assets Loan Contract On July 17, 2015, 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. Interest on the outstanding principal balance of the loan accrues at a benchmark rate plus a margin. The current interest rate at March 31, 2018 is approximately 5.2% . 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, 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. The Company was in compliance with all covenants under the Notes, the ABL Facility, and the Loan Agreement at March 31, 2018 . Long-term Capitalized Lease Liabilities As of March 31, 2018 and December 31, 2017 , the Company had capitalized lease liabilities totaling $ 19.9 million and $ 20.7 million , respectively. These amounts represent the lease on the corporate headquarters and the Kunshan, China facility, as well as other leases for machinery and equipment, software and vehicles that expire at various dates through 2027. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
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, 2018 , the provision for income taxes was $1.3 million , as compared to $ 2.7 million for the three months ended March 31, 2017 , respectively. The decrease in tax expense in the three months ended March 31, 2018 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 34.8% ; 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, Germany, 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 of March 31, 2018 , the Company has not completed its accounting related to the enactment of the Tax Cuts and Jobs Act (the "Tax Act"), as follows: 1. Remeasurement of U.S. deferred tax assets - During the fourth quarter of 2017, the Company recorded a provisional estimate of $31.8 million discrete deferred tax expense related to the remeasurement of the U.S. deferred tax assets as a result of the reduction in the corporate income tax rate. A corresponding tax benefit was recorded related to the reduction in valuation allowance. 2. Transition tax - During the fourth quarter of 2017, the Company recorded a provisional estimate related to accounting for the transition tax and its impact on tax accounting for unrepatriated foreign earnings and other foreign income inclusions. The provisional estimate resulted in $0 current or deferred tax impact primarily as a result of the historic tax loss carry-forwards and the corresponding valuation allowance against related deferred tax assets. In order to complete the accounting, the Company will continue to analyze foreign earnings calculations as well as to await clarification of certain provisions of the Tax Act. 3. Deferred tax accounting on outside basis differences of controlled foreign corporations - Consistent with the provisional estimates made during the fourth quarter of 2017, the Company has recorded a provisional estimate related to the deferred tax accounting for basis differences associated with foreign subsidiaries. Historically, the Company has accrued U.S. deferred taxes in connection with certain foreign earnings which were not considered to be permanently reinvested as these earnings were expected to be distributed to the U.S. However, the transition tax has resulted in immediate U.S. taxation of previously untaxed foreign earnings. As a result, the Company has reversed the U.S. deferred taxes previously recognized on those foreign earnings that were not considered to be permanently reinvested. Additionally, future repatriation of foreign earnings (even those previously considered to be permanently reinvested) would not be expected to give rise to U.S. tax under the Tax Act’s territorial regime. Therefore, a provisional estimate has been recorded for deferred taxes on unrepatriated foreign earnings assuming none of the earnings are permanently reinvested. No additional U.S. income taxes have been provided in connection with any remaining untaxed foreign earnings or any additional outside basis difference with respect to investments in foreign subsidiaries as the Company assesses whether any investments should be considered as indefinitely reinvested in foreign operations. 4. Global Intangible Low-Taxed Income (“GILTI”) - In the first quarter of 2018, the Company has recorded a provisional estimate related to its GILTI inclusion, and the provisional estimate reduces U.S. tax loss carryforwards and the corresponding valuation allowance. In order to complete the accounting, the Company will await clarification of certain provisions. The deferred tax accounting for basis differences associated with foreign subsidiaries as it relates to GILTI remains incomplete and no provisional estimate has been provided. The election of an accounting policy with respect to deferred tax accounting for GILTI will depend, in part, on analyzing foreign income to estimate future GILTI inclusions, as well as clarification of certain provisions of the Tax Act. Until such analyses and clarifications are made, the Company has not made a policy decision regarding deferred tax accounting for the GILTI provision. 5. Interest Deduction Limitation - The Company has recorded a provisional estimate related to the limitation on U.S. interest expense as a result of the Tax Act. The estimate reduces the U.S. tax loss carryforwards but establishes indefinite-lived deferred tax assets for the interest that is limited. In order to complete the accounting, the Company will await clarification of certain provisions. 6. State and Local Income Taxes - The Company has recorded a provisional estimate related to the tax accounting for state and local income taxes upon enactment of the Tax Act. The Company continues to gather and analyze information available related to the impact of the Tax Act on state and local taxes and awaits clarification from the municipalities in order to complete the accounting. To the extent a provisional estimate was made, the Company utilized previously issued guidance for the Tax Act in order to reach an estimate. However, these estimates are not capable of finalization given the lack of statutory and regulatory guidance in many areas, as well as the complexity in acquiring the data required to calculate the impact on the tax accounts. The Company will revise and conclude the accounting as and when additional information is obtained, which in many cases is contingent on the timing of issuance of guidance. For these reasons, the ultimate impact may differ from these provisional amounts due to, among other things, additional information, changes in interpretations and assumptions management has made, and changes based on additional statutory and regulatory guidance that may be issued. Acknowledging this uncertainty, accounting for the impacts of the Tax Act will be completed within the twelve months of the use of the estimates. As of March 31, 2018 , the Company had a gross amount of unrecognized tax benefit of $10.2 million , exclusive of interest and penalties. The unrecognized tax benefit increased by approximately $0.2 million during the three months ended March 31, 2018 , as a result of new positions related to the current year primarily related to transfer pricing 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 less than $0.1 million related to the unrecognized tax benefits for the three months ended March 31, 2018 . The tax years 2005 through 2017 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, 2018 | |
Retirement Benefits [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, 2018 2017 Service cost $ 383 $ 376 Interest cost 1,088 1,267 Expected return on plan assets (1,405 ) (1,496 ) Amortization of net loss 583 590 Net periodic benefit cost $ 649 $ 737 Service costs are included as a component of operating income while interest cost, expected return on plan assets and amortization of net loss are included as a component of non-operating expense in other components of net periodic pension cost on the consolidated statements of operations. |
Comprehensive Income and Accumu
Comprehensive Income and Accumulated Other Comprehensive Loss | 3 Months Ended |
Mar. 31, 2018 | |
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, 2018 (net of tax benefit of $0.1 million ) and 2017 (net of a tax expense of $0.1 million ) is as follows: Three Months Ended March 31, 2018 2017 Net income (loss) $ 2,231 $ (2,834 ) Foreign currency translation adjustments 6,077 9,765 Pension liability changes under Topic 715 54 (125 ) Comprehensive income $ 8,362 $ 6,806 Included in foreign currency translation adjustments are foreign currency losses on intercompany transactions that are considered a long-term investment totaling $1.1 million for the three months ended March 31, 2018 and $0.9 million for the three months ended March 31, 2017 , respectively. The components of accumulated other comprehensive loss for the three months ended March 31, 2018 are as follows (net of tax benefits of $5.8 million ): Foreign Currency Translation Adjustment Pension Liability Changes Under Topic 715 Accumulated Other Comprehensive (Loss) Income Balance at December 31, 2017 $ (69,149 ) $ (42,110 ) $ (111,259 ) Other comprehensive income (loss) before reclassifications 6,077 (529 ) 5,548 Amounts reclassified from other comprehensive loss Amortization of actuarial losses — 583 583 Net current period other comprehensive income 6,077 54 6,131 Balance at March 31, 2018 $ (63,072 ) $ (42,056 ) $ (105,128 ) For the three months ended March 31, 2018 , the amortization of actuarial losses is included in other components of net periodic pension cost in the consolidated statements of operations. |
Restructuring Expense
Restructuring Expense | 3 Months Ended |
Mar. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Expense | Restructuring Expense For the three months ended March 31, 2018 and 2017 , the Company incurred restructuring expenses of $0.8 million and $3.2 million , respectively, relating to headcount reductions and other costs related to previous plant closures. The Company expects to continue to review its business to determine if additional actions will be taken to further improve its cost structure. Restructuring expenses of approximately $1.0 million to $3.0 million are estimated during 2018, primarily related to the continuation of streamlining the operating structure and improving long-term competitiveness of the Company. Actual restructuring costs for 2018 may substantially differ from estimates at this time, depending on actual operating results in 2018 and the timing of the restructuring activities. The following table sets forth the significant components of the restructuring accrual (included in Accrued Expenses in the Company's Consolidated Balance Sheet), including activity under restructuring programs for the three months ended March 31, 2018 and 2017 : Balance at December 31, 2017 Charges Currency Cash Balance at Severance and other benefits $ 2,686 $ 183 $ 44 $ (987 ) $ 1,926 Facility costs and other 733 641 12 (950 ) 436 Total $ 3,419 $ 824 $ 56 $ (1,937 ) $ 2,362 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 Restructuring expense by segment, which is not included in Segment Earnings in Note 9, is as follows: Three Months Ended March 31, 2018 2017 Clothing $ 186 $ 2,476 Roll Covers 638 627 Corporate — 61 Total $ 824 $ 3,164 |
Business Segment Information
Business Segment Information | 3 Months Ended |
Mar. 31, 2018 | |
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. 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, 2018 and 2017 . Clothing Roll Corporate Total Three months ended March 31, 2018 Net Sales $ 75,757 $ 50,318 $ — $ 126,075 Segment Earnings (Loss) $ 18,912 $ 10,756 $ (4,275 ) $ 25,393 Three months ended March 31, 2017 Net Sales $ 72,495 $ 47,371 $ — $ 119,866 Segment Earnings (Loss) $ 20,798 $ 9,795 $ (4,037 ) $ 26,556 Provided below is a reconciliation of Segment Earnings (Loss) to Income (Loss) before provision for income taxes for the three months ended March 31, 2018 and 2017 , respectively. Three Months Ended March 31, 2018 2017 Segment Earnings (Loss): Clothing $ 18,912 $ 20,798 Roll Covers 10,756 9,795 Corporate (4,275 ) (4,037 ) Stock-based compensation (355 ) (531 ) CEO transition expense (157 ) — Interest expense, net (12,765 ) (13,263 ) Depreciation and amortization (8,261 ) (8,093 ) Loss on extinguishment of debt — (25 ) Restructuring expense (824 ) (3,164 ) Other non-recurring expense (122 ) (45 ) Plant startup costs — (480 ) Unrealized foreign exchange gain (loss) 659 (1,108 ) Income (loss) before provision for income taxes $ 3,568 $ (153 ) |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
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, 2018 , 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 that 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. |
Long-term Incentive and Stock-B
Long-term Incentive and Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Long-term Incentive and Stock-Based Compensation | Long-term Incentive and Stock-Based Compensation 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, and DSUs. The Company recorded stock-based compensation expense during the three months ended March 31, 2018 and March 31, 2017 as follows: Three Months Ended March 31, 2018 2017 RSU and DSU Awards (1) $ 355 $ 531 (1) Related to RSUs and DSUs awarded to certain employees and non-employee directors. Summary of Recent Activity Under Long-term Incentive Plans Long-Term Incentive Program - 2018 LTIP On January 30, 2018, the Board of Directors approved the 2018 - 2020 Long-Term Incentive Plan (the "2018 LTIP") which provides for the grant of incentive award opportunities (each, an "Award") payable, if earned, in cash. Because any Award under the 2018 LTIP will be paid in cash, and not equity, the Awards granted under the 2018 LTIP are not made pursuant to the Xerium Technologies, Inc. 2010 Equity Incentive Plan. Awards will consist of Phantom Stock Units. Each Phantom Stock Unit represents the right to receive a cash amount equal to the Average Value of one share of common stock of the Company as described below: • 282,240 Time-based awards, or 50% of the total target award for each participant, have been granted in the form of time-based units. The time-based units vest on the third anniversary of the date of grant. • 282,240 Performance-based awards, or 50% of the total target award for each participant, have been granted in the form of performance-based units. Of these units, one half will vest based on the financial performance of the Company as measured by Adjusted EBITDA, and one half will vest based on the Return on Net Assets (as defined in the 2018 LTIP) of the Company. Half of the performance-based units whose vesting is subject to the financial performance of the Company will vest based on the degree to which the Company achieves a targeted three -year cumulative Adjusted EBITDA metric, adjusted for currency fluctuations, over the performance period of January 1, 2018 through December 31, 2020. The amount of units that will vest between the target threshold and target ceiling will range from 50% to 200% of the employee's total units granted. Below the target threshold 0% of the units will vest. Half of the performance-based units whose vesting is subject to the financial performance of the Company will vest based on the degree to which the Company achieves an average three -year Return on Net Assets metric over the performance period of January 1, 2018 through December 31, 2020. The amount of units that will vest between the target threshold and target ceiling will range from 50% to 200% of the employee's total units granted. Below the target threshold 0% of the units will vest. Long-Term Incentive Program— 2015 LTIP Awards under the 2015 LTIP vested on March 2, 2018, and were converted to 22,895 shares of common stock, after withholdings. 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 22,763 DSUs under the 2011 DSU Plan for service during the three months ended March 31, 2018 . In addition, in accordance with the 2011 DSU Plan, as amended in January of 2015, 14,424 DSUs, and 15,003 DSUs were settled in common stock during the three months ended March 31, 2018 and March 31, 2017 , respectively. |
Supplemental Guarantor Financia
Supplemental Guarantor Financial Information | 3 Months Ended |
Mar. 31, 2018 | |
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 Xerium Technologies, Inc. (referred to as “Parent” for the purpose of this note only) and are fully and unconditionally guaranteed, jointly and severally, on a senior secured basis by all of the domestic 100% owned subsidiaries of the Parent (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 the Parent 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 At March 31, 2018 (Dollars in thousands, and unaudited) Parent Total Total Non Other The ASSETS Current assets: Cash and cash equivalents $ 1,882 $ 50 $ 7,969 $ — $ 9,901 Accounts receivable, net 51 21,668 60,754 — 82,473 Intercompany receivables (473,425 ) 489,224 (15,799 ) — — Inventories, net — 15,400 62,187 (940 ) 76,647 Prepaid expenses 566 232 12,887 — 13,685 Other current assets 150 3,515 13,180 — 16,845 Total current assets (470,776 ) 530,089 141,178 (940 ) 199,551 Property and equipment, net 6,238 59,469 215,735 — 281,442 Investments 913,248 286,184 — (1,199,432 ) — Goodwill — 19,614 47,564 — 67,178 Intangible assets — 5,655 3 — 5,658 Non-current deferred tax asset — — 11,198 — 11,198 Other assets — — 9,211 — 9,211 Total assets $ 448,710 $ 901,011 $ 424,889 $ (1,200,372 ) $ 574,238 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Notes payable $ — $ — $ 8,622 $ — $ 8,622 Accounts payable 1,595 12,240 26,421 — 40,256 Accrued expenses 12,638 7,622 30,822 — 51,082 Current maturities of long-term debt 1,561 2,485 5,809 — 9,855 Total current liabilities 15,794 22,347 71,674 — 109,815 Long-term debt, net of current maturities 477,744 — 7,185 — 484,929 Liabilities under capital leases 3,727 2,286 9,176 — 15,189 Non-current deferred tax liability 3,541 — 10,060 — 13,601 Pension, other post-retirement and post-employment obligations 20,673 1,605 46,623 — 68,901 Other long-term liabilities — — 9,944 — 9,944 Intercompany loans 63,885 (111,609 ) 47,724 — — Total stockholders’ (deficit) equity (136,654 ) 986,382 222,503 (1,200,372 ) (128,141 ) Total liabilities and stockholders’ (deficit) equity $ 448,710 $ 901,011 $ 424,889 $ (1,200,372 ) $ 574,238 Xerium Technologies, Inc. Consolidating Balance Sheet At December 31, 2017 (Dollars in thousands, and unaudited) Parent Total Total Non Other The ASSETS Current assets: Cash and cash equivalents $ 3,578 $ 57 $ 13,618 $ — $ 17,253 Accounts receivable, net 20 19,721 56,892 — 76,633 Intercompany receivables (452,873 ) 475,864 (22,991 ) — — Inventories, net — 16,618 59,047 (940 ) 74,725 Prepaid expenses 266 316 10,753 — 11,335 Other current assets 175 3,338 11,803 — 15,316 Total current assets (448,834 ) 515,914 129,122 (940 ) 195,262 Property and equipment, net 7,044 60,382 214,952 — 282,378 Investments 901,275 271,278 — (1,172,553 ) — Goodwill — 19,614 45,169 — 64,783 Intangible assets — 5,961 4 — 5,965 Non-current deferred tax asset — — 10,103 — 10,103 Other assets — — 9,358 — 9,358 Total assets $ 459,485 $ 873,149 $ 408,708 $ (1,173,493 ) $ 567,849 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Notes payable $ — $ — $ 8,398 $ — $ 8,398 Accounts payable 1,963 11,431 26,462 — 39,856 Accrued expenses 26,186 8,214 29,755 — 64,155 Current maturities of long-term debt 1,800 2,329 6,485 — 10,614 Total current liabilities 29,949 21,974 71,100 — 123,023 Long-term debt, net of current maturities 467,605 — 6,299 — 473,904 Liabilities under capital leases 4,159 2,831 8,962 — 15,952 Non-current deferred tax liability 3,439 — 9,458 — 12,897 Pension, other post-retirement and post-employment obligations 21,402 1,434 46,369 — 69,205 Other long-term liabilities — — 9,334 — 9,334 Intercompany loans 71,692 (108,319 ) 36,627 — — Total stockholders’ (deficit) equity (138,761 ) 955,229 220,559 (1,173,493 ) (136,466 ) Total liabilities and stockholders’ (deficit) equity $ 459,485 $ 873,149 $ 408,708 $ (1,173,493 ) $ 567,849 Xerium Technologies, Inc. Consolidating Statement of Operations and Comprehensive Income (Loss) For the three months ended March 31, 2018 (Dollars in thousands, and unaudited) Parent Total Guarantors Total Non Guarantors Other Eliminations The Company Net sales $ — $ 46,063 $ 85,093 $ (5,081 ) $ 126,075 Costs and expenses: Cost of products sold — 29,843 54,080 (5,081 ) 78,842 Selling 51 4,716 10,910 — 15,677 General and administrative 56 (3,763 ) 16,804 — 13,097 Research and development 335 817 416 — 1,568 Restructuring — 443 381 — 824 442 32,056 82,591 (5,081 ) 110,008 (Loss) income from operations (442 ) 14,007 2,502 — 16,067 Interest expense, net (11,907 ) (440 ) (418 ) — (12,765 ) Foreign exchange gain (loss) 601 306 (375 ) — 532 Equity in subsidiaries income 11,973 2,283 — (14,256 ) — Other components of net periodic pension cost (129 ) (192 ) 55 — (266 ) Dividend income (expense), net 2,508 2,510 — (5,018 ) — Income (loss) before provision for income taxes 2,604 18,474 1,764 (19,274 ) 3,568 (Provision for) benefit from income taxes (373 ) 2 (966 ) — (1,337 ) Net income (loss) $ 2,231 $ 18,476 $ 798 $ (19,274 ) $ 2,231 Comprehensive income (loss) $ 1,812 $ 18,445 $ 7,379 $ (19,274 ) $ 8,362 Xerium Technologies, Inc. Consolidating Statement of Operations and Comprehensive (Loss) Income For the three months ended March 31, 2017 (Dollars in thousands, and unaudited) Parent Total Total Non Other The Net sales $ — $ 46,945 $ 81,084 $ (8,163 ) $ 119,866 Costs and expenses: Cost of products sold — 30,855 49,548 (8,163 ) 72,240 Selling 233 5,044 10,397 — 15,674 General and administrative 2,570 879 8,974 — 12,423 Research and development 299 931 514 — 1,744 Restructuring 61 642 2,461 — 3,164 3,163 38,351 71,894 (8,163 ) 105,245 (Loss) income from operations (3,163 ) 8,594 9,190 — 14,621 Interest expense, net (12,338 ) (347 ) (578 ) — (13,263 ) Foreign exchange (loss) gain (472 ) 65 (718 ) — (1,125 ) Equity in subsidiaries income 8,714 4,381 — (13,095 ) — Other components of net periodic pension cost (132 ) (188 ) (41 ) — (361 ) Loss on extinguishment of debt (25 ) — — — (25 ) Dividend income (expense), net 4,263 3,858 — (8,121 ) — (Loss) income before provision for income taxes (3,153 ) 16,363 7,853 (21,216 ) (153 ) Benefit from (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 Cash Flows For the three months ended March 31, 2018 (Dollars in thousands, and unaudited) Parent Total Total Non Other The Operating activities Net income (loss) $ 2,231 $ 18,476 $ 798 $ (19,274 ) $ 2,231 Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: Stock-based compensation 355 — — — 355 Depreciation 573 1,998 5,383 — 7,954 Amortization of intangible assets — 306 1 — 307 Deferred financing cost amortization 888 — 44 — 932 Foreign exchange (gain) loss on revaluation of debt (180 ) — 96 — (84 ) Deferred taxes 101 — (305 ) — (204 ) Loss (gain) on disposition of property and equipment — 101 (158 ) — (57 ) Provision for doubtful accounts — 1 304 — 305 Undistributed equity in earnings of subsidiaries (11,973 ) (2,283 ) — 14,256 — Change in assets and liabilities which (used) provided cash: Accounts receivable (31 ) (1,948 ) (2,604 ) — (4,583 ) Inventories — 1,218 (2,174 ) — (956 ) Prepaid expenses (300 ) 84 (2,172 ) — (2,388 ) Other current assets 25 (178 ) (1,192 ) — (1,345 ) Accounts payable and accrued expenses (13,948 ) 193 (38 ) — (13,793 ) Deferred and other long-term liabilities (214 ) 171 (790 ) — (833 ) Intercompany loans 20,552 (13,403 ) (7,149 ) — — Net cash (used in) provided by operating activities (1,921 ) 4,736 (9,956 ) (5,018 ) (12,159 ) Investing activities Capital expenditures (176 ) (740 ) (1,594 ) — (2,510 ) Intercompany property and equipment transfers, net 380 (61 ) (319 ) — — Proceeds from disposals of property and equipment — 23 65 — 88 Net cash provided by (used in) investing activities 204 (778 ) (1,848 ) — (2,422 ) Financing activities Proceeds from borrowings 26,189 — 4,944 — 31,133 Principal payments on debt (16,943 ) — (5,570 ) — (22,513 ) Dividends paid — (2,508 ) (2,510 ) 5,018 — Payment of obligations under capital leases (604 ) (670 ) (150 ) — (1,424 ) Intercompany loans (8,562 ) (788 ) 9,350 — — Employee taxes paid on equity awards (59 ) — — — (59 ) Net cash provided by (used in) financing activities 21 (3,966 ) 6,064 5,018 7,137 Effect of exchange rate changes on cash flows — 1 91 — 92 Net decrease in cash (1,696 ) (7 ) (5,649 ) — (7,352 ) Cash and cash equivalents at beginning of period 3,578 57 13,618 — 17,253 Cash and cash equivalents at end of period $ 1,882 $ 50 $ 7,969 $ — $ 9,901 Xerium Technologies, Inc. Consolidating Statement of Cash Flows For the three months ended March 31, 2017 (Dollars in thousands, and unaudited) 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 loss 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 — Payments of obligations under capitalized leases (656 ) (721 ) (143 ) — (1,520 ) Payment of deferred 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 |
Description of Business and S18
Description of Business and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
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, 2018 and for the three months ended March 31, 2018 and 2017 include the accounts of the Company and its wholly-owned subsidiaries. These financial statements 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, 2017 as reported on the Company's Annual Report on Form 10-K filed on February 28, 2018. |
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, 2018 , 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, 2018 . |
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 Income (Loss) Per Common Share | Net Income (Loss) Per Common Share Net income (loss) per common share has been computed and presented pursuant to the provisions of ASC Topic 260, Earnings per Share (“Topic 260”). Net income (loss) per share is based on the weighted-average number of shares outstanding during the period. As of March 31, 2018 and 2017 , the Company had outstanding restricted stock units (“RSUs”) and deferred stock units (“DSUs”). |
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. |
Recently Adopted and Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements In March 2018, the FASB issued Accounting Standards Update No 2018-05, Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 (SAB 118). The amendments in ASU 2018-05 codified the amendments from SAB 118 which related to the income tax accounting implications of the Tax Cuts and Jobs Act. The Company already adopted SAB 118 as of December 31, 2017. Refer to Note 5 Income Taxes. In May 2017, the FASB issued Accounting Standards Update No 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting ("ASU 2017-09"). The amendments in ASU 2017-09 provide guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The amendments in ASU 2017-09 are effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period, for (1) public business entities for reporting periods for which financial statements have not yet been issued and (2) all other entities for reporting periods for which financial statements have not yet been made available for issuance. The amendments in this update should be applied prospectively to an award modified on or after the adoption date. The adoption of this guidance effective January 1, 2018 did not have a material impact on the Company's financial statements. 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. The Company elected the practical expedient that allowed it to estimate amounts for comparative periods using the information previously disclosed in its pension and other postretirement benefit plan note which reasonably reflects the effect of the capitalized amount of net periodic benefit cost for the prior comparative periods. The Company adopted this guidance effective January 1, 2018 and, as a result, reclassified $0.4 million of Q1 2017 pension cost (interest cost, expected return on plan assets, and amortization of net loss) out of operating income into other components of net periodic pension cost, a component of non-operating expenses on the consolidated statements of operations. The adoption of this standard did not have a material impact on the Company's net income or financial position. Also, no changes to cash flows resulted from adoption of this standard. 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 adopted this guidance effective January 1, 2018 which resulted in an increase in 2018 opening accumulated deficit of $0.3 million representing the cumulative net impact from (1) the write-off of unamortized tax expense previously deferred in income tax receivable under the previous guidance and (2) recognition of the previously unrecognized deferred tax assets, net of any necessary valuation allowance. The adoption of this standard did not have a material impact on the Company's net income or financial position. Also, no changes to cash flows resulted from adoption of this standard. 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. The adoption of this guidance effective January 1, 2018 did not have a material impact on the Company's 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 adopted this new standard effective January 1, 2018 using the modified retrospective transition method. The adoption of this standard did not result in adjustment to the Company's financial statements. Recently Issued Accounting Pronouncements In February 2018, the FASB issued Accounting Standards Update No 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (ASU 2018-02). The amendments in ASU 2018-02 allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The amendments in this update are effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption of the amendments in this update is permitted, including adoption in any interim period, for public business entities for reporting periods for which financial statements have not yet been issued and for all other entities for reporting periods for which financial statements have not yet been made available for issuance. The Company is in the process of evaluating this accounting standard update. In August 2017, the FASB issued Accounting Standards Update No 2017-12, Derivative and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12). The amendments in ASU 2017-12 provide guidance to better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. To meet that objective, the amendments expand and refine hedge accounting for both nonfinancial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. For public business entities, the amendments in this update are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early application is permitted in any interim period after issuance of the update. 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 February 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 December 15, 2018, and interim periods within those years. For all other entities, it is effective for annual periods beginning after December 15, 2019, and interim periods the following year. Early adoption is permitted for all entities. The Company has commenced a comprehensive project plan to direct the implementation of the new leases standard and an assessment of the impact to business processes. |
Revenue from Contract with Customers | The Company operates through two principal business segments, machine clothing and roll covers. The machine clothing segment performance obligations generally include the production of various types of industrial textiles used on paper-making machines and on other industrial applications. In the Company's roll covers segment, the performance obligations generally include the manufacturing of various types of roll covers, spreader rolls, refurbishment of previously installed roll covers, and providing mechanical services for the internal mechanisms of rolls used on paper-making machines. The contract and order economics and risks are determined to be at the segment level. Within each segment the contracts are similar. Total revenues by segment for the reporting periods on the Consolidated Statements of Operations are disclosed in Note 9. Revenue from the Company's performance obligations to customers is recognized at the point in time when control is transferred to the customer. Control is generally transferred to the customer when persuasive evidence of an arrangement exists, the price is fixed and determinable, delivery including transfer of title has occurred and there is a reasonable assurance of collection of the sales proceeds. The Company generally obtains written purchase authorizations from customers for a specific product or service performance obligation at a specified price and considers delivery and transfer of title to have occurred in accordance with its shipping terms. Payment is generally due in accordance with customary payment terms once the transfer of control has occurred. Revenue is recorded net of applicable allowances, including estimated allowances for returns, rebates and other discounts. Allowances are generally estimated based upon customer trends. In the machine clothing segment, a small portion of the business has been conducted pursuant to consignment arrangements under which the Company does not recognize a sale of a product to a customer until the customer places the product into use, which typically occurs some period after the product is shipped to the customer or to a warehouse location near the customer’s facility. As part of the consignment agreement, the Company delivers the goods to a location designated by the customer. In many cases, the customer and the Company generally agree to a “sunset” date, which represents the date by which the customer must accept all risks and rewards of ownership of the product and payment terms begin. For consignment sales, revenue is generally recognized on the earlier of the actual product installation date or the “sunset” date. The costs to fulfill the Company's performance obligations at a point in time are included in inventory. Refer to balances and further discussion in Note 1. Commissions are generally earned at the point in time the performance obligation is satisfied by the Company and are expensed as incurred. |
Description of Business and S19
Description of Business and Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Components of Inventories | The components of inventories are as follows at: March 31, 2018 December 31, 2017 Raw materials $ 15,128 $ 13,881 Work in process 30,222 27,819 Finished goods (includes consigned inventory of $7,029 at March 31, 2018 and $7,757 at December 31, 2017) 38,074 39,798 Inventory allowances (6,777 ) (6,773 ) $ 76,647 $ 74,725 |
Changes in Warranty Liability | The table below represents the changes in the Company’s warranty liability for the three months ended March 31, 2018 and 2017 : Beginning Balance Charged to Cost of Sales Effect of Foreign Currency Translation Deduction from Reserves Ending Balance Three Months Ended March 31, 2018: $ 2,470 $ 359 $ 37 $ (239 ) $ 2,627 Three Months Ended March 31, 2017: $ 2,203 $ 235 $ 30 $ (179 ) $ 2,289 |
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, 2018 2017 Weighted-average common shares outstanding–basic 16,398,076 16,153,113 Dilutive effect of stock-based compensation awards outstanding 257,774 — Weighted-average common shares outstanding–diluted 16,655,850 16,153,113 |
Schedule of Antidilutive Securities Excluded from Computation of Diluted Earnings Per Share | The following table sets forth the aggregate of the dilutive securities that were outstanding in the three months ended March 31, 2018 and 2017 , but were not included in the computation of diluted earnings per share because the impact would have been anti-dilutive or because a contingency for issuance was not yet satisfied in the period: Three Months Ended March 31, 2018 2017 Anti-dilutive securities 686,208 902,988 |
Derivatives and Hedging (Tables
Derivatives and Hedging (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments | The following represents the fair value of these derivatives at March 31, 2018 and December 31, 2017 and the change in fair value included in foreign exchange gain in the three months ended March 31, 2018 and 2017 : March 31, 2018 December 31, 2017 Fair value of derivative liability $ (39 ) $ (591 ) Three Months Ended March 31, 2018 Three Months Ended March 31, 2017 Change in fair value of derivative included in foreign exchange gain $ 427 $ 145 |
Notional Amounts of Foreign Exchange Forward Contracts | The following represents the notional amounts of foreign exchange forward contracts at March 31, 2018 : Notional Sold Notional Purchased Non-designated hedges of foreign exchange risk $ 18,372 $ (24,476 ) |
Long term Debt (Tables)
Long term Debt (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Summary of Long Term Debt | At March 31, 2018 and December 31, 2017 , long term debt consisted of the following: March 31, 2018 December 31, 2017 9.5% Senior Notes due August 2021. $ 480,000 $ 480,000 Capital leases 19,914 20,749 Notes payable, working capital loan, variable interest rate at 1.45%. Matures August 31, 2018, with one-year rollover option. 8,622 8,398 Fixed asset loan contract, variable interest rate of 5.23%. Matures June of 2020. 6,996 6,761 Other debt 15,235 6,062 Total debt 530,767 521,970 Less deferred financing costs and debt discount (12,172 ) (13,102 ) Less current maturities of long term debt and notes payable (18,477 ) (19,012 ) Total long term debt including capital leases $ 500,118 $ 489,856 Balance sheet classification of total long-term debt including capital leases Long-term debt, net of current maturities and deferred financing costs 484,929 473,904 Liabilities under capital lease, non-current 15,189 15,952 Total long term debt including capital leases $ 500,118 $ 489,856 |
Pensions, Other Post-retireme22
Pensions, Other Post-retirement and Post-employment Benefits (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Retirement Benefits [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, 2018 2017 Service cost $ 383 $ 376 Interest cost 1,088 1,267 Expected return on plan assets (1,405 ) (1,496 ) Amortization of net loss 583 590 Net periodic benefit cost $ 649 $ 737 |
Comprehensive Income and Accu23
Comprehensive Income and Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Equity [Abstract] | |
Components of Comprehensive Income, Net of Tax | Comprehensive income for the three months ended March 31, 2018 (net of tax benefit of $0.1 million ) and 2017 (net of a tax expense of $0.1 million ) is as follows: Three Months Ended March 31, 2018 2017 Net income (loss) $ 2,231 $ (2,834 ) Foreign currency translation adjustments 6,077 9,765 Pension liability changes under Topic 715 54 (125 ) Comprehensive income $ 8,362 $ 6,806 |
Components of Accumulated Other Comprehensive Loss | The components of accumulated other comprehensive loss for the three months ended March 31, 2018 are as follows (net of tax benefits of $5.8 million ): Foreign Currency Translation Adjustment Pension Liability Changes Under Topic 715 Accumulated Other Comprehensive (Loss) Income Balance at December 31, 2017 $ (69,149 ) $ (42,110 ) $ (111,259 ) Other comprehensive income (loss) before reclassifications 6,077 (529 ) 5,548 Amounts reclassified from other comprehensive loss Amortization of actuarial losses — 583 583 Net current period other comprehensive income 6,077 54 6,131 Balance at March 31, 2018 $ (63,072 ) $ (42,056 ) $ (105,128 ) |
Restructuring Expense (Tables)
Restructuring Expense (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Summary of Significant Components of Restructuring Accrual | The following table sets forth the significant components of the restructuring accrual (included in Accrued Expenses in the Company's Consolidated Balance Sheet), including activity under restructuring programs for the three months ended March 31, 2018 and 2017 : Balance at December 31, 2017 Charges Currency Cash Balance at Severance and other benefits $ 2,686 $ 183 $ 44 $ (987 ) $ 1,926 Facility costs and other 733 641 12 (950 ) 436 Total $ 3,419 $ 824 $ 56 $ (1,937 ) $ 2,362 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 |
Summary of Restructuring Expense by Segment | Restructuring expense by segment, which is not included in Segment Earnings in Note 9, is as follows: Three Months Ended March 31, 2018 2017 Clothing $ 186 $ 2,476 Roll Covers 638 627 Corporate — 61 Total $ 824 $ 3,164 |
Business Segment Information (T
Business Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Summarized Financial Information by Segment | Summarized financial information for the Company’s reportable segments is presented in the tables that follow for the three months ended March 31, 2018 and 2017 . Clothing Roll Corporate Total Three months ended March 31, 2018 Net Sales $ 75,757 $ 50,318 $ — $ 126,075 Segment Earnings (Loss) $ 18,912 $ 10,756 $ (4,275 ) $ 25,393 Three months ended March 31, 2017 Net Sales $ 72,495 $ 47,371 $ — $ 119,866 Segment Earnings (Loss) $ 20,798 $ 9,795 $ (4,037 ) $ 26,556 |
Reconciliation of Segment Earnings (Loss) to Income (Loss) Before Provision for Income Taxes | Provided below is a reconciliation of Segment Earnings (Loss) to Income (Loss) before provision for income taxes for the three months ended March 31, 2018 and 2017 , respectively. Three Months Ended March 31, 2018 2017 Segment Earnings (Loss): Clothing $ 18,912 $ 20,798 Roll Covers 10,756 9,795 Corporate (4,275 ) (4,037 ) Stock-based compensation (355 ) (531 ) CEO transition expense (157 ) — Interest expense, net (12,765 ) (13,263 ) Depreciation and amortization (8,261 ) (8,093 ) Loss on extinguishment of debt — (25 ) Restructuring expense (824 ) (3,164 ) Other non-recurring expense (122 ) (45 ) Plant startup costs — (480 ) Unrealized foreign exchange gain (loss) 659 (1,108 ) Income (loss) before provision for income taxes $ 3,568 $ (153 ) |
Long-term Incentive and Stock26
Long-term Incentive and Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock-Based Compensation Expense | The Company recorded stock-based compensation expense during the three months ended March 31, 2018 and March 31, 2017 as follows: Three Months Ended March 31, 2018 2017 RSU and DSU Awards (1) $ 355 $ 531 (1) Related to RSUs and DSUs awarded to certain employees and non-employee directors. |
Supplemental Guarantor Financ27
Supplemental Guarantor Financial Information (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidating Balance Sheet | Parent Total Total Non Other The ASSETS Current assets: Cash and cash equivalents $ 1,882 $ 50 $ 7,969 $ — $ 9,901 Accounts receivable, net 51 21,668 60,754 — 82,473 Intercompany receivables (473,425 ) 489,224 (15,799 ) — — Inventories, net — 15,400 62,187 (940 ) 76,647 Prepaid expenses 566 232 12,887 — 13,685 Other current assets 150 3,515 13,180 — 16,845 Total current assets (470,776 ) 530,089 141,178 (940 ) 199,551 Property and equipment, net 6,238 59,469 215,735 — 281,442 Investments 913,248 286,184 — (1,199,432 ) — Goodwill — 19,614 47,564 — 67,178 Intangible assets — 5,655 3 — 5,658 Non-current deferred tax asset — — 11,198 — 11,198 Other assets — — 9,211 — 9,211 Total assets $ 448,710 $ 901,011 $ 424,889 $ (1,200,372 ) $ 574,238 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Notes payable $ — $ — $ 8,622 $ — $ 8,622 Accounts payable 1,595 12,240 26,421 — 40,256 Accrued expenses 12,638 7,622 30,822 — 51,082 Current maturities of long-term debt 1,561 2,485 5,809 — 9,855 Total current liabilities 15,794 22,347 71,674 — 109,815 Long-term debt, net of current maturities 477,744 — 7,185 — 484,929 Liabilities under capital leases 3,727 2,286 9,176 — 15,189 Non-current deferred tax liability 3,541 — 10,060 — 13,601 Pension, other post-retirement and post-employment obligations 20,673 1,605 46,623 — 68,901 Other long-term liabilities — — 9,944 — 9,944 Intercompany loans 63,885 (111,609 ) 47,724 — — Total stockholders’ (deficit) equity (136,654 ) 986,382 222,503 (1,200,372 ) (128,141 ) Total liabilities and stockholders’ (deficit) equity $ 448,710 $ 901,011 $ 424,889 $ (1,200,372 ) $ 574,238 Xerium Technologies, Inc. Consolidating Balance Sheet At December 31, 2017 (Dollars in thousands, and unaudited) Parent Total Total Non Other The ASSETS Current assets: Cash and cash equivalents $ 3,578 $ 57 $ 13,618 $ — $ 17,253 Accounts receivable, net 20 19,721 56,892 — 76,633 Intercompany receivables (452,873 ) 475,864 (22,991 ) — — Inventories, net — 16,618 59,047 (940 ) 74,725 Prepaid expenses 266 316 10,753 — 11,335 Other current assets 175 3,338 11,803 — 15,316 Total current assets (448,834 ) 515,914 129,122 (940 ) 195,262 Property and equipment, net 7,044 60,382 214,952 — 282,378 Investments 901,275 271,278 — (1,172,553 ) — Goodwill — 19,614 45,169 — 64,783 Intangible assets — 5,961 4 — 5,965 Non-current deferred tax asset — — 10,103 — 10,103 Other assets — — 9,358 — 9,358 Total assets $ 459,485 $ 873,149 $ 408,708 $ (1,173,493 ) $ 567,849 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities: Notes payable $ — $ — $ 8,398 $ — $ 8,398 Accounts payable 1,963 11,431 26,462 — 39,856 Accrued expenses 26,186 8,214 29,755 — 64,155 Current maturities of long-term debt 1,800 2,329 6,485 — 10,614 Total current liabilities 29,949 21,974 71,100 — 123,023 Long-term debt, net of current maturities 467,605 — 6,299 — 473,904 Liabilities under capital leases 4,159 2,831 8,962 — 15,952 Non-current deferred tax liability 3,439 — 9,458 — 12,897 Pension, other post-retirement and post-employment obligations 21,402 1,434 46,369 — 69,205 Other long-term liabilities — — 9,334 — 9,334 Intercompany loans 71,692 (108,319 ) 36,627 — — Total stockholders’ (deficit) equity (138,761 ) 955,229 220,559 (1,173,493 ) (136,466 ) Total liabilities and stockholders’ (deficit) equity $ 459,485 $ 873,149 $ 408,708 $ (1,173,493 ) $ 567,849 |
Consolidating Statement of Operations and Comprehensive Income (Loss) | Parent Total Guarantors Total Non Guarantors Other Eliminations The Company Net sales $ — $ 46,063 $ 85,093 $ (5,081 ) $ 126,075 Costs and expenses: Cost of products sold — 29,843 54,080 (5,081 ) 78,842 Selling 51 4,716 10,910 — 15,677 General and administrative 56 (3,763 ) 16,804 — 13,097 Research and development 335 817 416 — 1,568 Restructuring — 443 381 — 824 442 32,056 82,591 (5,081 ) 110,008 (Loss) income from operations (442 ) 14,007 2,502 — 16,067 Interest expense, net (11,907 ) (440 ) (418 ) — (12,765 ) Foreign exchange gain (loss) 601 306 (375 ) — 532 Equity in subsidiaries income 11,973 2,283 — (14,256 ) — Other components of net periodic pension cost (129 ) (192 ) 55 — (266 ) Dividend income (expense), net 2,508 2,510 — (5,018 ) — Income (loss) before provision for income taxes 2,604 18,474 1,764 (19,274 ) 3,568 (Provision for) benefit from income taxes (373 ) 2 (966 ) — (1,337 ) Net income (loss) $ 2,231 $ 18,476 $ 798 $ (19,274 ) $ 2,231 Comprehensive income (loss) $ 1,812 $ 18,445 $ 7,379 $ (19,274 ) $ 8,362 Xerium Technologies, Inc. Consolidating Statement of Operations and Comprehensive (Loss) Income For the three months ended March 31, 2017 (Dollars in thousands, and unaudited) Parent Total Total Non Other The Net sales $ — $ 46,945 $ 81,084 $ (8,163 ) $ 119,866 Costs and expenses: Cost of products sold — 30,855 49,548 (8,163 ) 72,240 Selling 233 5,044 10,397 — 15,674 General and administrative 2,570 879 8,974 — 12,423 Research and development 299 931 514 — 1,744 Restructuring 61 642 2,461 — 3,164 3,163 38,351 71,894 (8,163 ) 105,245 (Loss) income from operations (3,163 ) 8,594 9,190 — 14,621 Interest expense, net (12,338 ) (347 ) (578 ) — (13,263 ) Foreign exchange (loss) gain (472 ) 65 (718 ) — (1,125 ) Equity in subsidiaries income 8,714 4,381 — (13,095 ) — Other components of net periodic pension cost (132 ) (188 ) (41 ) — (361 ) Loss on extinguishment of debt (25 ) — — — (25 ) Dividend income (expense), net 4,263 3,858 — (8,121 ) — (Loss) income before provision for income taxes (3,153 ) 16,363 7,853 (21,216 ) (153 ) Benefit from (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 |
Consolidating Statement of Cash Flows | Parent Total Total Non Other The Operating activities Net income (loss) $ 2,231 $ 18,476 $ 798 $ (19,274 ) $ 2,231 Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: Stock-based compensation 355 — — — 355 Depreciation 573 1,998 5,383 — 7,954 Amortization of intangible assets — 306 1 — 307 Deferred financing cost amortization 888 — 44 — 932 Foreign exchange (gain) loss on revaluation of debt (180 ) — 96 — (84 ) Deferred taxes 101 — (305 ) — (204 ) Loss (gain) on disposition of property and equipment — 101 (158 ) — (57 ) Provision for doubtful accounts — 1 304 — 305 Undistributed equity in earnings of subsidiaries (11,973 ) (2,283 ) — 14,256 — Change in assets and liabilities which (used) provided cash: Accounts receivable (31 ) (1,948 ) (2,604 ) — (4,583 ) Inventories — 1,218 (2,174 ) — (956 ) Prepaid expenses (300 ) 84 (2,172 ) — (2,388 ) Other current assets 25 (178 ) (1,192 ) — (1,345 ) Accounts payable and accrued expenses (13,948 ) 193 (38 ) — (13,793 ) Deferred and other long-term liabilities (214 ) 171 (790 ) — (833 ) Intercompany loans 20,552 (13,403 ) (7,149 ) — — Net cash (used in) provided by operating activities (1,921 ) 4,736 (9,956 ) (5,018 ) (12,159 ) Investing activities Capital expenditures (176 ) (740 ) (1,594 ) — (2,510 ) Intercompany property and equipment transfers, net 380 (61 ) (319 ) — — Proceeds from disposals of property and equipment — 23 65 — 88 Net cash provided by (used in) investing activities 204 (778 ) (1,848 ) — (2,422 ) Financing activities Proceeds from borrowings 26,189 — 4,944 — 31,133 Principal payments on debt (16,943 ) — (5,570 ) — (22,513 ) Dividends paid — (2,508 ) (2,510 ) 5,018 — Payment of obligations under capital leases (604 ) (670 ) (150 ) — (1,424 ) Intercompany loans (8,562 ) (788 ) 9,350 — — Employee taxes paid on equity awards (59 ) — — — (59 ) Net cash provided by (used in) financing activities 21 (3,966 ) 6,064 5,018 7,137 Effect of exchange rate changes on cash flows — 1 91 — 92 Net decrease in cash (1,696 ) (7 ) (5,649 ) — (7,352 ) Cash and cash equivalents at beginning of period 3,578 57 13,618 — 17,253 Cash and cash equivalents at end of period $ 1,882 $ 50 $ 7,969 $ — $ 9,901 Xerium Technologies, Inc. Consolidating Statement of Cash Flows For the three months ended March 31, 2017 (Dollars in thousands, and unaudited) 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 loss 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 — Payments of obligations under capitalized leases (656 ) (721 ) (143 ) — (1,520 ) Payment of deferred 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 |
Description of Business and S28
Description of Business and Significant Accounting Policies - Components of Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Raw materials | $ 15,128 | $ 13,881 |
Work in process | 30,222 | 27,819 |
Finished goods (includes consigned inventory of $7,029 at March 31, 2018 and $7,757 at December 31, 2017) | 38,074 | 39,798 |
Inventory allowances | (6,777) | (6,773) |
Inventories, net | 76,647 | 74,725 |
Consigned inventory | $ 7,029 | $ 7,757 |
Description of Business and S29
Description of Business and Significant Accounting Policies - Changes in Warranty Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Warranties, Increase (Decrease) | ||
Beginning Balance | $ 2,470 | $ 2,203 |
Charged to Cost of Sales | 359 | 235 |
Effect of Foreign Currency Translation | 37 | 30 |
Deduction from Reserves | (239) | (179) |
Ending Balance | $ 2,627 | $ 2,289 |
Description of Business and S30
Description of Business and Significant Accounting Policies - Net Income (Loss) Per Common Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Weighted-average common shares outstanding–basic (in shares) | 16,398,076 | 16,153,113 |
Dilutive effect of stock-based compensation awards outstanding (in shares) | 257,774 | 0 |
Weighted-average common shares outstanding–diluted (in shares) | 16,655,850 | 16,153,113 |
Anti-dilutive securities (in shares) | 686,208 | 902,988 |
Description of Business and S31
Description of Business and Significant Accounting Policies - Additional Information (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Jan. 01, 2018 | Dec. 31, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||||
Increase to other components of net periodic pension cost, as a result of adoption of new accounting guidance | $ 266,000 | $ 361,000 | ||
Increase in operating income as a result of adoption of new accounting guidance | 16,067,000 | 14,621,000 | ||
Increase in accumulated deficit due to adoption of new accounting guidance | 455,814,000 | $ 457,712,000 | ||
Restructuring Expense | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Asset impairment | $ 0 | 0 | ||
Accounting Standards Update 2016-06 | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Increase in accumulated deficit due to adoption of new accounting guidance | $ 300,000 | |||
Accounting Standards Update 2017-07 | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Increase to other components of net periodic pension cost, as a result of adoption of new accounting guidance | 400,000 | |||
Increase in operating income as a result of adoption of new accounting guidance | $ 400,000 |
Revenue from Contracts with C32
Revenue from Contracts with Customers (Details) | 3 Months Ended | |||
Mar. 31, 2018USD ($)segment | Mar. 31, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Number of reportable segments | segment | 2 | |||
Commissions expense | $ 3,300,000 | $ 3,500,000 | ||
Net account receivable balances from customers | 82,473,000 | $ 76,633,000 | ||
Contract receivables | 0 | 0 | ||
Roll Covers | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Contract liability | $ 800,000 | $ 600,000 | $ 500,000 | $ 1,100,000 |
Derivatives and Hedging - Sched
Derivatives and Hedging - Schedule of Derivative Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Derivative [Line Items] | |||
Change in fair value of derivative included in foreign exchange gain | $ 427 | $ 145 | |
Not Designated as Hedging Instrument | Fair value of derivative liability | |||
Derivative [Line Items] | |||
Fair value of derivative liability | $ (39) | $ (591) |
Derivatives and Hedging - Notio
Derivatives and Hedging - Notional Amounts of Foreign Exchange Forward Contracts (Details) - Not Designated as Hedging Instrument - Fair value of derivative liability $ in Thousands | Mar. 31, 2018USD ($) |
Notional Sold | |
Derivative [Line Items] | |
Non-designated hedges of foreign exchange risk | $ (18,372) |
Notional Purchased | |
Derivative [Line Items] | |
Non-designated hedges of foreign exchange risk | $ (24,476) |
Long term Debt - Schedule of Lo
Long term Debt - Schedule of Long Term Debt (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2017 | |
Other Long-term Debt [Abstract] | ||
Total debt | $ 530,767 | $ 521,970 |
Less deferred financing costs and debt discount | (12,172) | (13,102) |
Less current maturities of long term debt and notes payable | (18,477) | (19,012) |
Total long term debt including capital leases | 500,118 | 489,856 |
Balance Sheet Classification Of Long-Term Debt And Capital Lease Obligations [Abstract] | ||
Long-term debt, net of current maturities | 484,929 | 473,904 |
Liabilities under capital leases | 15,189 | 15,952 |
Total long term debt including capital leases | 500,118 | 489,856 |
Other debt | ||
Other Long-term Debt [Abstract] | ||
Total debt | 15,235 | 6,062 |
Notes payable | Notes payable, working capital loan, variable interest rate at 1.45%. Matures August 31, 2018, with one-year rollover option. | ||
Other Long-term Debt [Abstract] | ||
Total debt | $ 8,622 | 8,398 |
Balance Sheet Classification Of Long-Term Debt And Capital Lease Obligations [Abstract] | ||
Short-term debt, percentage bearing variable interest rate | 1.45% | |
Rollover option period | 1 year | |
Secured Debt | 9.5% Senior Notes due August 2021. | ||
Other Long-term Debt [Abstract] | ||
Total debt | $ 480,000 | 480,000 |
Balance Sheet Classification Of Long-Term Debt And Capital Lease Obligations [Abstract] | ||
Debt instrument interest rate | 9.50% | |
Secured Debt | Fixed asset loan contract, variable interest rate of 5.23%. Matures June of 2020. | ||
Balance Sheet Classification Of Long-Term Debt And Capital Lease Obligations [Abstract] | ||
Debt instrument interest rate | 5.23% | |
Capital Lease Obligations | ||
Other Long-term Debt [Abstract] | ||
Total debt | $ 19,914 | 20,749 |
Capital Lease Obligations | Fixed asset loan contract, variable interest rate of 5.23%. Matures June of 2020. | ||
Other Long-term Debt [Abstract] | ||
Total debt | $ 6,996 | $ 6,761 |
Long term Debt - Additional Inf
Long term Debt - Additional Information (Details) | Aug. 09, 2016USD ($) | Jul. 17, 2015USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Aug. 18, 2016USD ($) | Nov. 03, 2015USD ($) | Jul. 17, 2015CNY (¥) | May 26, 2011USD ($) |
Debt Instrument [Line Items] | ||||||||
Carrying value of long-term debt | $ 518,600,000 | |||||||
Fair value of long-term debt | 546,400,000 | |||||||
Total debt | 530,767,000 | $ 521,970,000 | ||||||
Capital Lease Obligations | ||||||||
Debt Instrument [Line Items] | ||||||||
Total debt | $ 19,914,000 | 20,749,000 | ||||||
9.5% Senior Notes due August 2021. | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 480,000,000 | |||||||
Debt instrument interest rate | 9.50% | |||||||
Redemption price percentage of debt | 98.54% | |||||||
Total debt | $ 480,000,000 | $ 480,000,000 | ||||||
Senior Secured Term Loan Facility | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 230,000,000 | |||||||
Senior Notes Unsecured | Senior Notes (Unsecured) | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 240,000,000 | |||||||
Redemption price percentage of debt | 102.219% | |||||||
Debt instrument fixed interest rate | 8.875% | |||||||
ABL Secured Facility | Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit capacity | $ 55,000,000 | |||||||
Remaining borrowing capacity | $ 25,400,000 | |||||||
Amount outstanding | 37,800,000 | |||||||
ABL Secured Facility | Letter of Credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Amount outstanding | 12,400,000 | |||||||
Other Small Lines of Credit | Line of Credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Remaining borrowing capacity | $ 6,400,000 | |||||||
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 | |||||||
Prime Rate | ABL Secured Facility | Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument interest rate | 5.50% | |||||||
Basis spreads on variable rate debt | 0.75% | |||||||
London Interbank Offered Rate (LIBOR) | ABL Secured Facility | Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument interest rate | 3.75% | |||||||
Basis spreads on variable rate debt | 1.75% | |||||||
Benchmark Rate | Xerium China Loan Agreement | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate during period (percent) | 5.20% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Provision for income taxes | $ 1,337,000 | $ 2,681,000 | |
Discrete deferred tax expense | $ 31,800,000 | ||
Deferred tax impact | 0 | ||
Additional income taxes related to remaining untaxed foreign earnings | 0 | ||
Provisional estimate for GILTI | $ 0 | ||
Gross unrecognized tax benefit | 10,200,000 | ||
Increase in unrecognized tax benefits | 200,000 | ||
Unrecognized tax benefits related to income tax matters and income tax expense | $ 100,000 |
Pensions, Other Post-retireme38
Pensions, Other Post-retirement and Post-employment Benefits - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Pensions, Other Post-Retirement And Post-Employment Benefits [Abstract] | ||
Service cost | $ 383 | $ 376 |
Interest cost | 1,088 | 1,267 |
Expected return on plan assets | (1,405) | (1,496) |
Amortization of net loss | 583 | 590 |
Net periodic benefit cost | $ 649 | $ 737 |
Comprehensive Income and Accu39
Comprehensive Income and Accumulated Other Comprehensive Loss - Components of Comprehensive Loss, Net of Tax (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Equity [Abstract] | ||
Other comprehensive loss, tax (benefit) expense | $ (100) | $ 100 |
Comprehensive Income Loss and Accumulated Other Comprehensive Income (Loss) [Abstract] | ||
Net income (loss) | 2,231 | (2,834) |
Foreign currency translation adjustments | 6,077 | 9,765 |
Pension liability changes under Topic 715 | 54 | (125) |
Comprehensive income | 8,362 | 6,806 |
Foreign currency (losses) on intercompany transactions | $ (1,100) | $ (900) |
Comprehensive Income and Accu40
Comprehensive Income and Accumulated Other Comprehensive Loss - Components of Accumulated Other Comprehensive Loss (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Accumulated other comprehensive loss, tax benefit | $ 5,800 |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at beginning | (136,466) |
Amounts reclassified from other comprehensive loss: | |
Balance at end | (128,141) |
Foreign Currency Translation Adjustment | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at beginning | (69,149) |
Other comprehensive income (loss) before reclassifications | 6,077 |
Amounts reclassified from other comprehensive loss: | |
Amortization of actuarial losses | 0 |
Net current period other comprehensive (loss) income | 6,077 |
Balance at end | (63,072) |
Pension Liability Changes Under Topic 715 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at beginning | (42,110) |
Other comprehensive income (loss) before reclassifications | (529) |
Amounts reclassified from other comprehensive loss: | |
Amortization of actuarial losses | 583 |
Net current period other comprehensive (loss) income | 54 |
Balance at end | (42,056) |
Accumulated Other Comprehensive (Loss) Income | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at beginning | (111,259) |
Other comprehensive income (loss) before reclassifications | 5,548 |
Amounts reclassified from other comprehensive loss: | |
Amortization of actuarial losses | 583 |
Net current period other comprehensive (loss) income | 6,131 |
Balance at end | $ (105,128) |
Restructuring Expense - Additio
Restructuring Expense - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | $ 824 | $ 3,164 |
Minimum | ||
Restructuring Cost and Reserve [Line Items] | ||
Estimated remaining restructuring expenses | 1,000 | |
Maximum | ||
Restructuring Cost and Reserve [Line Items] | ||
Estimated remaining restructuring expenses | $ 3,000 |
Restructuring Expense - Restruc
Restructuring Expense - Restructuring Programs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Restructuring Reserve | ||
Beginning Balance | $ 3,419 | $ 4,197 |
Charges | 824 | 3,164 |
Currency Effects | 56 | 152 |
Cash Payments | (1,937) | (2,041) |
Ending Balance | 2,362 | 5,472 |
Severance and other benefits | ||
Restructuring Reserve | ||
Beginning Balance | 2,686 | 3,805 |
Charges | 183 | 2,258 |
Currency Effects | 44 | 138 |
Cash Payments | (987) | (1,061) |
Ending Balance | 1,926 | 5,140 |
Facility costs and other | ||
Restructuring Reserve | ||
Beginning Balance | 733 | 392 |
Charges | 641 | 906 |
Currency Effects | 12 | 14 |
Cash Payments | (950) | (980) |
Ending Balance | $ 436 | $ 332 |
Restructuring Expense - Restr43
Restructuring Expense - Restructuring Expense by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | $ 824 | $ 3,164 |
Operating Segments | Clothing | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | 186 | 2,476 |
Operating Segments | Roll Covers | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | 638 | 627 |
Corporate | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring | $ 0 | $ 61 |
Business Segment Information -
Business Segment Information - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2018segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Business Segment Information 45
Business Segment Information - Summarized Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Segment Reporting Information [Line Items] | ||
Net Sales | $ 126,075 | $ 119,866 |
Segment Earnings (Loss) | 25,393 | 26,556 |
Operating Segments | Clothing | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 75,757 | 72,495 |
Segment Earnings (Loss) | 18,912 | 20,798 |
Operating Segments | Roll Covers | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 50,318 | 47,371 |
Segment Earnings (Loss) | 10,756 | 9,795 |
Corporate | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 0 | 0 |
Segment Earnings (Loss) | $ (4,275) | $ (4,037) |
Business Segment Information 46
Business Segment Information - Reconciliation of Segment Earnings (Loss) To Income (Loss) Before Provision For Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Segment Earnings (Loss): | ||
Segment Earnings (Loss) | $ 25,393 | $ 26,556 |
Stock-based compensation | (355) | (531) |
CEO transition expense | (157) | 0 |
Interest expense, net | (12,765) | (13,263) |
Depreciation and amortization | (8,261) | (8,093) |
Loss on extinguishment of debt | 0 | (25) |
Restructuring expense | (824) | (3,164) |
Other non-recurring expense | (122) | (45) |
Plant startup costs | 0 | (480) |
Unrealized foreign exchange gain (loss) | 659 | (1,108) |
Income (loss) before provision for income taxes | 3,568 | (153) |
Operating Segments | Clothing | ||
Segment Earnings (Loss): | ||
Segment Earnings (Loss) | 18,912 | 20,798 |
Restructuring expense | (186) | (2,476) |
Operating Segments | Roll Covers | ||
Segment Earnings (Loss): | ||
Segment Earnings (Loss) | 10,756 | 9,795 |
Restructuring expense | (638) | (627) |
Corporate | ||
Segment Earnings (Loss): | ||
Segment Earnings (Loss) | (4,275) | (4,037) |
Restructuring expense | $ 0 | $ (61) |
Long-term Incentive and Stock47
Long-term Incentive and Stock-Based Compensation - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock compensation expense | $ 355 | $ 531 |
RSU, Options and DSU Awards | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock compensation expense | $ 355 | $ 531 |
Long-term Incentive and Stock48
Long-term Incentive and Stock-Based Compensation - Additional Information (Details) - USD ($) $ in Thousands | Mar. 02, 2018 | Jan. 30, 2018 | May 30, 2017 | Mar. 31, 2018 | Mar. 31, 2017 |
Performance Based Awards, EBITDA | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Range of vesting units (as a percent) | 50.00% | ||||
Performance Based Awards, Return on Net Assets | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Range of vesting units (as a percent) | 50.00% | ||||
Long Term Incentive Plan Twenty Eighteen | Time Based Phantom Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share based awards (in shares) | 282,240 | ||||
Percentage of total target award (as a percent) | 50.00% | ||||
Vesting period | 3 years | ||||
Long Term Incentive Plan Twenty Eighteen | Performance Based Phantom Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share based awards (in shares) | 282,240 | ||||
Percentage of total target award (as a percent) | 50.00% | ||||
Long Term Incentive Plan Twenty Eighteen | Performance Based Awards, EBITDA | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 3 years | ||||
Range of vesting units (as a percent) | 0.00% | 50.00% | |||
Long Term Incentive Plan Twenty Eighteen | Performance Based Awards, Return on Net Assets | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 3 years | ||||
Range of vesting units (as a percent) | 0.00% | 50.00% | |||
Long Term Incentive Plan Twenty Fifteen | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Awards converted to common stock (in shares) | 22,895 | ||||
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) | 22,763 | ||||
2011 DSU Plan | Deferred Stock Unit (DSUs) | Common Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares issued (in shares) | 14,424 | 15,003 | |||
Minimum | Long Term Incentive Plan Twenty Eighteen | Performance Based Awards, EBITDA | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Range of vesting units (as a percent) | 50.00% | ||||
Minimum | Long Term Incentive Plan Twenty Eighteen | Performance Based Awards, Return on Net Assets | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Range of vesting units (as a percent) | 50.00% | ||||
Maximum | Long Term Incentive Plan Twenty Eighteen | Performance Based Awards, EBITDA | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Range of vesting units (as a percent) | 200.00% | ||||
Maximum | Long Term Incentive Plan Twenty Eighteen | Performance Based Awards, Return on Net Assets | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Range of vesting units (as a percent) | 200.00% |
Supplemental Guarantor Financ49
Supplemental Guarantor Financial Information - Consolidating Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||||
Cash and cash equivalents | $ 9,901 | $ 17,253 | $ 10,138 | $ 12,808 |
Accounts receivable, net | 82,473 | 76,633 | ||
Intercompany receivables | 0 | 0 | ||
Inventories, net | 76,647 | 74,725 | ||
Prepaid expenses | 13,685 | 11,335 | ||
Other current assets | 16,845 | 15,316 | ||
Total current assets | 199,551 | 195,262 | ||
Property and equipment, net | 281,442 | 282,378 | ||
Investments | 0 | 0 | ||
Goodwill | 67,178 | 64,783 | ||
Intangible assets | 5,658 | 5,965 | ||
Non-current deferred tax asset | 11,198 | 10,103 | ||
Other assets | 9,211 | 9,358 | ||
Total assets | 574,238 | 567,849 | ||
Current liabilities: | ||||
Notes payable | 8,622 | 8,398 | ||
Accounts payable | 40,256 | 39,856 | ||
Accrued expenses | 51,082 | 64,155 | ||
Current maturities of long-term debt | 9,855 | 10,614 | ||
Total current liabilities | 109,815 | 123,023 | ||
Long-term debt, net of current maturities | 484,929 | 473,904 | ||
Liabilities under capital leases | 15,189 | 15,952 | ||
Non-current deferred tax liability | 13,601 | 12,897 | ||
Pension, other post-retirement and post-employment obligations | 68,901 | 69,205 | ||
Other long-term liabilities | 9,944 | 9,334 | ||
Intercompany loans | 0 | 0 | ||
Total stockholders’ deficit | (128,141) | (136,466) | ||
Total liabilities and stockholders’ deficit | 574,238 | 567,849 | ||
Other Eliminations | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 0 | 0 | ||
Intercompany receivables | 0 | 0 | ||
Inventories, net | (940) | (940) | ||
Prepaid expenses | 0 | 0 | ||
Other current assets | 0 | 0 | ||
Total current assets | (940) | (940) | ||
Property and equipment, net | 0 | 0 | ||
Investments | (1,199,432) | (1,172,553) | ||
Goodwill | 0 | 0 | ||
Intangible assets | 0 | 0 | ||
Non-current deferred tax asset | 0 | 0 | ||
Other assets | 0 | 0 | ||
Total assets | (1,200,372) | (1,173,493) | ||
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 | (1,200,372) | (1,173,493) | ||
Total liabilities and stockholders’ deficit | (1,200,372) | (1,173,493) | ||
Parent | ||||
Current assets: | ||||
Cash and cash equivalents | 1,882 | 3,578 | 2,056 | 1,368 |
Accounts receivable, net | 51 | 20 | ||
Intercompany receivables | (473,425) | (452,873) | ||
Inventories, net | 0 | 0 | ||
Prepaid expenses | 566 | 266 | ||
Other current assets | 150 | 175 | ||
Total current assets | (470,776) | (448,834) | ||
Property and equipment, net | 6,238 | 7,044 | ||
Investments | 913,248 | 901,275 | ||
Goodwill | 0 | 0 | ||
Intangible assets | 0 | 0 | ||
Non-current deferred tax asset | 0 | 0 | ||
Other assets | 0 | 0 | ||
Total assets | 448,710 | 459,485 | ||
Current liabilities: | ||||
Notes payable | 0 | 0 | ||
Accounts payable | 1,595 | 1,963 | ||
Accrued expenses | 12,638 | 26,186 | ||
Current maturities of long-term debt | 1,561 | 1,800 | ||
Total current liabilities | 15,794 | 29,949 | ||
Long-term debt, net of current maturities | 477,744 | 467,605 | ||
Liabilities under capital leases | 3,727 | 4,159 | ||
Non-current deferred tax liability | 3,541 | 3,439 | ||
Pension, other post-retirement and post-employment obligations | 20,673 | 21,402 | ||
Other long-term liabilities | 0 | 0 | ||
Intercompany loans | 63,885 | 71,692 | ||
Total stockholders’ deficit | (136,654) | (138,761) | ||
Total liabilities and stockholders’ deficit | 448,710 | 459,485 | ||
Total Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 50 | 57 | 66 | 279 |
Accounts receivable, net | 21,668 | 19,721 | ||
Intercompany receivables | 489,224 | 475,864 | ||
Inventories, net | 15,400 | 16,618 | ||
Prepaid expenses | 232 | 316 | ||
Other current assets | 3,515 | 3,338 | ||
Total current assets | 530,089 | 515,914 | ||
Property and equipment, net | 59,469 | 60,382 | ||
Investments | 286,184 | 271,278 | ||
Goodwill | 19,614 | 19,614 | ||
Intangible assets | 5,655 | 5,961 | ||
Non-current deferred tax asset | 0 | 0 | ||
Other assets | 0 | 0 | ||
Total assets | 901,011 | 873,149 | ||
Current liabilities: | ||||
Notes payable | 0 | 0 | ||
Accounts payable | 12,240 | 11,431 | ||
Accrued expenses | 7,622 | 8,214 | ||
Current maturities of long-term debt | 2,485 | 2,329 | ||
Total current liabilities | 22,347 | 21,974 | ||
Long-term debt, net of current maturities | 0 | 0 | ||
Liabilities under capital leases | 2,286 | 2,831 | ||
Non-current deferred tax liability | 0 | 0 | ||
Pension, other post-retirement and post-employment obligations | 1,605 | 1,434 | ||
Other long-term liabilities | 0 | 0 | ||
Intercompany loans | (111,609) | (108,319) | ||
Total stockholders’ deficit | 986,382 | 955,229 | ||
Total liabilities and stockholders’ deficit | 901,011 | 873,149 | ||
Total Non Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 7,969 | 13,618 | $ 8,016 | $ 11,161 |
Accounts receivable, net | 60,754 | 56,892 | ||
Intercompany receivables | (15,799) | (22,991) | ||
Inventories, net | 62,187 | 59,047 | ||
Prepaid expenses | 12,887 | 10,753 | ||
Other current assets | 13,180 | 11,803 | ||
Total current assets | 141,178 | 129,122 | ||
Property and equipment, net | 215,735 | 214,952 | ||
Investments | 0 | 0 | ||
Goodwill | 47,564 | 45,169 | ||
Intangible assets | 3 | 4 | ||
Non-current deferred tax asset | 11,198 | 10,103 | ||
Other assets | 9,211 | 9,358 | ||
Total assets | 424,889 | 408,708 | ||
Current liabilities: | ||||
Notes payable | 8,622 | 8,398 | ||
Accounts payable | 26,421 | 26,462 | ||
Accrued expenses | 30,822 | 29,755 | ||
Current maturities of long-term debt | 5,809 | 6,485 | ||
Total current liabilities | 71,674 | 71,100 | ||
Long-term debt, net of current maturities | 7,185 | 6,299 | ||
Liabilities under capital leases | 9,176 | 8,962 | ||
Non-current deferred tax liability | 10,060 | 9,458 | ||
Pension, other post-retirement and post-employment obligations | 46,623 | 46,369 | ||
Other long-term liabilities | 9,944 | 9,334 | ||
Intercompany loans | 47,724 | 36,627 | ||
Total stockholders’ deficit | 222,503 | 220,559 | ||
Total liabilities and stockholders’ deficit | $ 424,889 | $ 408,708 |
Supplemental Guarantor Financ50
Supplemental Guarantor Financial Information - Consolidating Statement of Operations and Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Condensed Income Statements, Captions [Line Items] | ||
Net Sales | $ 126,075 | $ 119,866 |
Costs and expenses: | ||
Cost of products sold | 78,842 | 72,240 |
Selling | 15,677 | 15,674 |
General and administrative | 13,097 | 12,423 |
Research and development | 1,568 | 1,744 |
Restructuring | 824 | 3,164 |
Costs and expenses | 110,008 | 105,245 |
(Loss) income from operations | 16,067 | 14,621 |
Interest expense, net | (12,765) | (13,263) |
Foreign exchange gain (loss) | 532 | (1,125) |
Equity in subsidiaries income | 0 | 0 |
Other components of net periodic pension cost | (266) | (361) |
Loss on extinguishment of debt | 0 | (25) |
Dividend income (expense), net | 0 | 0 |
Income (loss) before provision for income taxes | 3,568 | (153) |
(Provision for) benefit from income taxes | (1,337) | (2,681) |
Net income (loss) | 2,231 | (2,834) |
Comprehensive income | 8,362 | 6,806 |
Other Eliminations | ||
Condensed Income Statements, Captions [Line Items] | ||
Net Sales | (5,081) | (8,163) |
Costs and expenses: | ||
Cost of products sold | (5,081) | (8,163) |
Selling | 0 | 0 |
General and administrative | 0 | 0 |
Research and development | 0 | 0 |
Restructuring | 0 | 0 |
Costs and expenses | (5,081) | (8,163) |
(Loss) income from operations | 0 | 0 |
Interest expense, net | 0 | 0 |
Foreign exchange gain (loss) | 0 | 0 |
Equity in subsidiaries income | (14,256) | (13,095) |
Other components of net periodic pension cost | 0 | 0 |
Loss on extinguishment of debt | 0 | |
Dividend income (expense), net | (5,018) | (8,121) |
Income (loss) before provision for income taxes | (19,274) | (21,216) |
(Provision for) benefit from income taxes | 0 | 0 |
Net income (loss) | (19,274) | (21,216) |
Comprehensive income | (19,274) | (21,216) |
Parent | ||
Condensed Income Statements, Captions [Line Items] | ||
Net Sales | 0 | 0 |
Costs and expenses: | ||
Cost of products sold | 0 | 0 |
Selling | 51 | 233 |
General and administrative | 56 | 2,570 |
Research and development | 335 | 299 |
Restructuring | 0 | 61 |
Costs and expenses | 442 | 3,163 |
(Loss) income from operations | (442) | (3,163) |
Interest expense, net | (11,907) | (12,338) |
Foreign exchange gain (loss) | 601 | (472) |
Equity in subsidiaries income | 11,973 | 8,714 |
Other components of net periodic pension cost | (129) | (132) |
Loss on extinguishment of debt | (25) | |
Dividend income (expense), net | 2,508 | 4,263 |
Income (loss) before provision for income taxes | 2,604 | (3,153) |
(Provision for) benefit from income taxes | (373) | 319 |
Net income (loss) | 2,231 | (2,834) |
Comprehensive income | 1,812 | (3,684) |
Total Guarantors | ||
Condensed Income Statements, Captions [Line Items] | ||
Net Sales | 46,063 | 46,945 |
Costs and expenses: | ||
Cost of products sold | 29,843 | 30,855 |
Selling | 4,716 | 5,044 |
General and administrative | (3,763) | 879 |
Research and development | 817 | 931 |
Restructuring | 443 | 642 |
Costs and expenses | 32,056 | 38,351 |
(Loss) income from operations | 14,007 | 8,594 |
Interest expense, net | (440) | (347) |
Foreign exchange gain (loss) | 306 | 65 |
Equity in subsidiaries income | 2,283 | 4,381 |
Other components of net periodic pension cost | (192) | (188) |
Loss on extinguishment of debt | 0 | |
Dividend income (expense), net | 2,510 | 3,858 |
Income (loss) before provision for income taxes | 18,474 | 16,363 |
(Provision for) benefit from income taxes | 2 | (141) |
Net income (loss) | 18,476 | 16,222 |
Comprehensive income | 18,445 | 16,230 |
Total Non Guarantors | ||
Condensed Income Statements, Captions [Line Items] | ||
Net Sales | 85,093 | 81,084 |
Costs and expenses: | ||
Cost of products sold | 54,080 | 49,548 |
Selling | 10,910 | 10,397 |
General and administrative | 16,804 | 8,974 |
Research and development | 416 | 514 |
Restructuring | 381 | 2,461 |
Costs and expenses | 82,591 | 71,894 |
(Loss) income from operations | 2,502 | 9,190 |
Interest expense, net | (418) | (578) |
Foreign exchange gain (loss) | (375) | (718) |
Equity in subsidiaries income | 0 | 0 |
Other components of net periodic pension cost | 55 | (41) |
Loss on extinguishment of debt | 0 | |
Dividend income (expense), net | 0 | 0 |
Income (loss) before provision for income taxes | 1,764 | 7,853 |
(Provision for) benefit from income taxes | (966) | (2,859) |
Net income (loss) | 798 | 4,994 |
Comprehensive income | $ 7,379 | $ 15,476 |
Supplemental Guarantor Financ51
Supplemental Guarantor Financial Information - Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Operating activities | ||
Net income (loss) | $ 2,231 | $ (2,834) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Stock-based compensation | 355 | 531 |
Depreciation | 7,954 | 7,819 |
Amortization of intangible assets | 307 | 273 |
Deferred financing cost amortization | 932 | 899 |
Foreign exchange (gain) loss on revaluation of debt | (84) | 627 |
Deferred taxes | (204) | 10 |
Gain on disposition of property and equipment | (57) | (49) |
Loss on extinguishment of debt | 0 | 25 |
Provision for doubtful accounts | 305 | 41 |
Undistributed equity in earnings of subsidiaries | 0 | 0 |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | (4,583) | (4,153) |
Inventories | (956) | (1,136) |
Prepaid expenses | (2,388) | 783 |
Other current assets | (1,345) | (1,785) |
Accounts payable and accrued expenses | (13,793) | (7,334) |
Deferred and other long-term liabilities | (833) | (940) |
Intercompany loans | 0 | 0 |
Net cash used in operating activities | (12,159) | (7,223) |
Investing activities | ||
Capital expenditures | (2,510) | (5,285) |
Intercompany property and equipment transfers, net | 0 | 0 |
Proceeds from disposals of property and equipment | 88 | 216 |
Net cash used in investing activities | (2,422) | (5,069) |
Financing activities | ||
Proceeds from borrowings | 31,133 | 40,476 |
Principal payments on debt | (22,513) | (29,693) |
Dividends paid | 0 | 0 |
Payment of obligations under capital leases | (1,424) | (1,520) |
Payment of financing fees | 0 | (170) |
Intercompany loans | 0 | 0 |
Employee taxes paid on equity awards | (59) | 0 |
Net cash provided by financing activities | 7,137 | 9,093 |
Effect of exchange rate changes on cash flows | 92 | 529 |
Net decrease in cash | (7,352) | (2,670) |
Cash and cash equivalents at beginning of period | 17,253 | 12,808 |
Cash and cash equivalents at end of period | 9,901 | 10,138 |
Other Eliminations | ||
Operating activities | ||
Net income (loss) | (19,274) | (21,216) |
Adjustments to reconcile net income (loss) to net cash used in 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) loss on revaluation of debt | 0 | 0 |
Deferred taxes | 0 | 0 |
Gain on disposition of property and equipment | 0 | 0 |
Loss on extinguishment of debt | 0 | |
Provision for doubtful accounts | 0 | 0 |
Undistributed equity in earnings of subsidiaries | 14,256 | 13,095 |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | 0 | 0 |
Inventories | 0 | 0 |
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 operating activities | (5,018) | (8,121) |
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 | 5,018 | 8,121 |
Payment of obligations under capital leases | 0 | 0 |
Payment of financing fees | 0 | |
Intercompany loans | 0 | 0 |
Employee taxes paid on equity awards | 0 | |
Net cash provided by financing activities | 5,018 | 8,121 |
Effect of exchange rate changes on cash flows | 0 | 0 |
Net 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 income (loss) | 2,231 | (2,834) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Stock-based compensation | 355 | 531 |
Depreciation | 573 | 579 |
Amortization of intangible assets | 0 | 0 |
Deferred financing cost amortization | 888 | 875 |
Foreign exchange (gain) loss on revaluation of debt | (180) | 625 |
Deferred taxes | 101 | (321) |
Gain on disposition of property and equipment | 0 | 0 |
Loss on extinguishment of debt | 25 | |
Provision for doubtful accounts | 0 | 0 |
Undistributed equity in earnings of subsidiaries | (11,973) | (8,714) |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | (31) | (8) |
Inventories | 0 | 0 |
Prepaid expenses | (300) | (226) |
Other current assets | 25 | 0 |
Accounts payable and accrued expenses | (13,948) | (14,965) |
Deferred and other long-term liabilities | (214) | (47) |
Intercompany loans | 20,552 | 17,832 |
Net cash used in operating activities | (1,921) | (6,648) |
Investing activities | ||
Capital expenditures | (176) | (158) |
Intercompany property and equipment transfers, net | 380 | 0 |
Proceeds from disposals of property and equipment | 0 | 0 |
Net cash used in investing activities | 204 | (158) |
Financing activities | ||
Proceeds from borrowings | 26,189 | 36,253 |
Principal payments on debt | (16,943) | (25,730) |
Dividends paid | 0 | 0 |
Payment of obligations under capital leases | (604) | (656) |
Payment of financing fees | (187) | |
Intercompany loans | (8,562) | (2,186) |
Employee taxes paid on equity awards | (59) | |
Net cash provided by financing activities | 21 | 7,494 |
Effect of exchange rate changes on cash flows | 0 | 0 |
Net decrease in cash | (1,696) | 688 |
Cash and cash equivalents at beginning of period | 3,578 | 1,368 |
Cash and cash equivalents at end of period | 1,882 | 2,056 |
Total Guarantors | ||
Operating activities | ||
Net income (loss) | 18,476 | 16,222 |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Stock-based compensation | 0 | 0 |
Depreciation | 1,998 | 2,069 |
Amortization of intangible assets | 306 | 246 |
Deferred financing cost amortization | 0 | 0 |
Foreign exchange (gain) loss on revaluation of debt | 0 | 0 |
Deferred taxes | 0 | 0 |
Gain on disposition of property and equipment | 101 | (37) |
Loss on extinguishment of debt | 0 | |
Provision for doubtful accounts | 1 | (15) |
Undistributed equity in earnings of subsidiaries | (2,283) | (4,381) |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | (1,948) | (2,981) |
Inventories | 1,218 | 62 |
Prepaid expenses | 84 | 289 |
Other current assets | (178) | (117) |
Accounts payable and accrued expenses | 193 | 443 |
Deferred and other long-term liabilities | 171 | 169 |
Intercompany loans | (13,403) | (9,010) |
Net cash used in operating activities | 4,736 | 2,959 |
Investing activities | ||
Capital expenditures | (740) | (167) |
Intercompany property and equipment transfers, net | (61) | 29 |
Proceeds from disposals of property and equipment | 23 | 211 |
Net cash used in investing activities | (778) | 73 |
Financing activities | ||
Proceeds from borrowings | 0 | 0 |
Principal payments on debt | 0 | 0 |
Dividends paid | (2,508) | (4,263) |
Payment of obligations under capital leases | (670) | (721) |
Payment of financing fees | 0 | |
Intercompany loans | (788) | 1,739 |
Employee taxes paid on equity awards | 0 | |
Net cash provided by financing activities | (3,966) | (3,245) |
Effect of exchange rate changes on cash flows | 1 | 0 |
Net decrease in cash | (7) | (213) |
Cash and cash equivalents at beginning of period | 57 | 279 |
Cash and cash equivalents at end of period | 50 | 66 |
Total Non Guarantors | ||
Operating activities | ||
Net income (loss) | 798 | 4,994 |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Stock-based compensation | 0 | 0 |
Depreciation | 5,383 | 5,171 |
Amortization of intangible assets | 1 | 27 |
Deferred financing cost amortization | 44 | 24 |
Foreign exchange (gain) loss on revaluation of debt | 96 | 2 |
Deferred taxes | (305) | 331 |
Gain on disposition of property and equipment | (158) | (12) |
Loss on extinguishment of debt | 0 | |
Provision for doubtful accounts | 304 | 56 |
Undistributed equity in earnings of subsidiaries | 0 | 0 |
Change in assets and liabilities which (used) provided cash: | ||
Accounts receivable | (2,604) | (1,164) |
Inventories | (2,174) | (1,198) |
Prepaid expenses | (2,172) | 720 |
Other current assets | (1,192) | (1,668) |
Accounts payable and accrued expenses | (38) | 7,188 |
Deferred and other long-term liabilities | (790) | (1,062) |
Intercompany loans | (7,149) | (8,822) |
Net cash used in operating activities | (9,956) | 4,587 |
Investing activities | ||
Capital expenditures | (1,594) | (4,960) |
Intercompany property and equipment transfers, net | (319) | (29) |
Proceeds from disposals of property and equipment | 65 | 5 |
Net cash used in investing activities | (1,848) | (4,984) |
Financing activities | ||
Proceeds from borrowings | 4,944 | 4,223 |
Principal payments on debt | (5,570) | (3,963) |
Dividends paid | (2,510) | (3,858) |
Payment of obligations under capital leases | (150) | (143) |
Payment of financing fees | 17 | |
Intercompany loans | 9,350 | 447 |
Employee taxes paid on equity awards | 0 | |
Net cash provided by financing activities | 6,064 | (3,277) |
Effect of exchange rate changes on cash flows | 91 | 529 |
Net decrease in cash | (5,649) | (3,145) |
Cash and cash equivalents at beginning of period | 13,618 | 11,161 |
Cash and cash equivalents at end of period | $ 7,969 | $ 8,016 |