Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Nov. 07, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | DOUGLAS DYNAMICS, INC | |
Entity Central Index Key | 1,287,213 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 22,590,897 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 1,482 | $ 18,609 |
Accounts receivable, net | 117,536 | 78,589 |
Inventories | 77,447 | 70,871 |
Inventories - truck chassis floor plan | 6,034 | 3,939 |
Refundable income taxes paid | 1,541 | |
Prepaid and other current assets | 3,417 | 2,886 |
Total current assets | 205,916 | 176,435 |
Property, plant, and equipment, net | 52,698 | 52,141 |
Goodwill | 240,906 | 238,286 |
Other intangible assets, net | 189,019 | 194,851 |
Other long-term assets | 5,531 | 4,460 |
Total assets | 694,070 | 666,173 |
Current liabilities: | ||
Accounts payable | 15,437 | 17,299 |
Accrued expenses and other current liabilities | 20,749 | 27,325 |
Floor plan obligations | 6,034 | 3,939 |
Income taxes payable | 1,440 | |
Short term borrowings | 23,000 | |
Current portion of long-term debt | 2,749 | 2,829 |
Total current liabilities | 69,409 | 51,392 |
Retiree health benefit obligation | 7,547 | 7,193 |
Pension obligation | 9,620 | 10,184 |
Deferred income taxes | 59,027 | 54,563 |
Long-term debt, less current portion | 305,354 | 306,726 |
Other long-term liabilities | 16,522 | 15,652 |
Stockholders' equity: | ||
Common Stock, par value $0.01, 200,000,000 shares authorized, 22,590,897 and 22,501,640 shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively | 226 | 225 |
Additional paid-in capital | 146,536 | 144,523 |
Retained earnings | 86,707 | 82,387 |
Accumulated other comprehensive loss, net of tax | (6,878) | (6,672) |
Total stockholders' equity | 226,591 | 220,463 |
Total liabilities and stockholders' equity | $ 694,070 | $ 666,173 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common Stock, shares authorized | 200,000,000 | 200,000,000 |
Common Stock, shares issued | 22,590,897 | 22,501,640 |
Common Stock, shares outstanding | 22,590,897 | 22,501,640 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME | ||||
Net sales | $ 125,339 | $ 123,573 | $ 336,958 | $ 286,125 |
Cost of sales | 89,284 | 86,929 | 238,683 | 193,829 |
Gross profit | 36,055 | 36,644 | 98,275 | 92,296 |
Selling, general, and administrative expense | 13,093 | 15,761 | 45,074 | 37,986 |
Intangibles amortization | 2,997 | 4,395 | 8,532 | 7,847 |
Income (loss) from operations | 19,965 | 16,488 | 44,669 | 46,463 |
Interest expense, net | (4,860) | (4,518) | (14,348) | (10,253) |
Litigation proceeds | 1,275 | 10,050 | ||
Other expense, net | (24) | (97) | (132) | (230) |
Income before taxes | 15,081 | 11,873 | 31,464 | 46,030 |
Income tax expense | 5,754 | 4,571 | 10,668 | 17,122 |
Net income | $ 9,327 | $ 7,302 | $ 20,796 | $ 28,908 |
Weighted average number of common shares outstanding: | ||||
Basic (in shares) | 22,590,897 | 22,501,640 | 22,571,560 | 22,473,642 |
Diluted (in shares) | 22,604,921 | 22,501,640 | 22,582,502 | 22,473,642 |
Earnings per common share: | ||||
Basic (in dollars per share) | $ 0.41 | $ 0.32 | $ 0.91 | $ 1.27 |
Diluted (in dollars per share) | 0.40 | 0.32 | 0.90 | 1.26 |
Cash dividends declared per share (in dollars per share) | 0.24 | 0.24 | 0.72 | 0.71 |
Cash dividends paid per share (in dollars per share) | $ 0.24 | $ 0.24 | $ 0.72 | $ 0.71 |
Comprehensive income (loss) | $ 9,396 | $ 7,321 | $ 20,590 | $ 27,400 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Operating activities | ||
Net income | $ 20,796 | $ 28,908 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | ||
Depreciation and amortization | 13,815 | 12,217 |
Inventory step up of acquired business included in cost of sales | 125 | |
Amortization of deferred financing costs and debt discount | 911 | 642 |
Stock-based compensation | 2,750 | 2,258 |
Provision (benefit) for losses on accounts receivable | 1,424 | 221 |
Deferred income taxes | 4,464 | 2,734 |
Earnout liability | (1,186) | (51) |
Changes in operating assets and liabilities, net of acquisitions: | ||
Accounts receivable | (39,519) | (37,659) |
Inventories | (4,929) | (1,973) |
Prepaid assets, refundable income taxes and other assets | (55) | 3,087 |
Accounts payable | (2,556) | (1,763) |
Accrued expenses and other current liabilities | 3,069 | 952 |
Benefit obligations and other long-term liabilities | 347 | 1,513 |
Net cash provided by (used in) operating activities | (669) | 11,211 |
Investing activities | ||
Capital expenditures | (5,216) | (7,084) |
Acquisition of business | (7,385) | (175,927) |
Net cash used in investing activities | (12,601) | (183,011) |
Financing activities | ||
Shares withheld on restricted stock vesting paid for employees' taxes | (923) | |
Payments of financing costs | (1,608) | (2,250) |
Earnout payment | (5,487) | |
Borrowings on long-term debt | 129,350 | |
Dividends paid | (16,476) | (16,086) |
Net revolver borrowings | 23,000 | 26,000 |
Repayment of long-term debt | (2,363) | (1,755) |
Net cash provided by (used in) financing activities | (3,857) | 135,259 |
Change in cash and cash equivalents | (17,127) | (36,541) |
Cash and cash equivalents at beginning of year | 18,609 | 36,844 |
Cash and cash equivalents at end of year | 1,482 | 303 |
Non-cash operating and financing activities | ||
Truck chassis inventory acquired through floorplan obligations | $ 33,271 | $ 8,481 |
Basis of presentation
Basis of presentation | 9 Months Ended |
Sep. 30, 2017 | |
Basis of presentation | |
Basis of presentation | 1. Basis of presentation The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for fiscal year-end financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. For further information, refer to the financial statements and related footnotes included in our 2016 Form 10-K (Commission File No. 001-34728) filed with the Securities and Exchange Commission on March 13, 2017. The Company currently conducts business in two segments: Work Truck Attachments and Work Truck Solutions. Financial information regarding these segments is reported in Note 13 to the Unaudited Condensed Consolidated Financial Statements . Certain reclassifications have been made to the prior period financial statements to conform to the 2017 presentation. In November 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) No. 2015-17, Balance Sheet Classification of Deferred Taxes , This ASU requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in a classified balance sheet. The Company adopted ASU No. 2015-17 during the quarter ended March 31, 2017 and applied it retrospectively. The adoption resulted in the reclassification of Deferred income taxes as included in Current assets to Deferred income taxes as included in Liabilities and shareholders’ equity on the balance sheet of $5,726 for December 31, 2016. Interim Condensed Consolidated Financial Information The accompanying condensed consolidated balance sheet as of September 30, 2017 and the condensed consolidated statements of operations and comprehensive income for the three and nine months ended September 30, 2017 and 2016 and condensed cash flows for the nine months ended September 30, 2017 and 2016 have been prepared by the Company and have not been audited. The Company’s Work Truck Attachments segment is seasonal and consequently its results of operations and financial condition vary from quarter-to-quarter. Because of this seasonality, the results of operations of the Work Truck Attachments segment for any quarter may not be indicative of results of operations that may be achieved for a subsequent quarter or the full year, and may not be similar to results of operations experienced in prior years. The Company attempts to manage the seasonal impact of snowfall on its revenues in part through its pre-season sales program. This pre-season sales program encourages the Company’s distributors to re-stock their inventory of Work Truck Attachments products during the second and third quarters in anticipation of the peak fourth quarter retail sales period by offering favorable pre-season pricing and payment deferral until the fourth quarter. Thus, the Company’s Work Truck Attachments segment tends to generate its greatest volume of sales during the second and third quarters. By contrast, its revenue and operating results tend to be lowest during the first quarter, as management believes the end-users of Work Truck Attachments products prefer to wait until the beginning of a snow season to purchase new equipment and as the Company’s distributors sell off Work Truck Attachments inventory and wait for the pre-season sales incentive period to re-stock inventory. Fourth quarter sales vary from year-to-year as they are primarily driven by the level, timing and location of snowfall during the quarter. This is because most of the Company’s Work Truck Attachments fourth quarter sales and shipments consist of re-orders by distributors seeking to restock inventory to meet immediate customer needs caused by snowfall during the winter months. In addition, due to the factors noted above, Work Truck Attachments working capital needs are highest in the second and third quarters as its accounts receivable rise from pre-season sales. These working capital needs decline in the fourth quarter as the Company receives payments for its pre-season shipments. The Company relies on a combination of patents, trade secrets and trademarks to protect certain of the proprietary aspects of its business and technology. In the nine months ended September 30, 2017, the Company received a settlement resulting from an ongoing lawsuit with one of its competitors. Previously under the same lawsuit the competitor was required to stop using the Company’s intellectual property. Under the settlement agreement the Company received $1,275 as part of defending its intellectual property. In the nine months ended September 30, 2016, the Company received a settlement resulting from an ongoing lawsuit with one of its competitors. Previously under the same lawsuit the competitor was required to stop using the Company’s intellectual property. Under the settlement agreement the Company received $10,050 as part of defending its intellectual property. The proceeds of the lawsuits are included on the Condensed Consolidated Statements of Operations and Comprehensive Income as Litigation proceeds. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2017 | |
Acquisitions | |
Acquisition | 2. Acquisition On May 1, 2017, the Company purchased substantially all of the assets of Arrowhead Equipment, Inc. (“Arrowhead”). Total consideration was $7,385 including a preliminary estimated working capital adjustment of $100 that increased the purchase price at the close of the transaction on May 1, 2017 that was subsequently adjusted by $215 paid by the seller to the Company, resulting in a final negative net working capital adjustment of $115 paid by the seller to the Company. The acquisition includes the Arrowhead’s assets acquired at two up-fit locations in Albany and Queensbury, New York that are both being leased by the Company. The assets were acquired with on hand cash and short term borrowings under the Company’s Revolving Credit Agreement. The acquired assets are included in the Work Truck Solutions segment and were acquired to expand the geographical footprint of that segment. The Company incurred $418 of transaction expenses related to this acquisition that are included in selling, general and administrative expense in the Condensed Consolidated Statements of Income in the nine months ended September 30, 2017, which includes $70 accrual reversal for estimated transaction-related expenses related to this acquisition that is included in selling, general and administrative expense in the Condensed Consolidated Statements of Income in the three months ended September 30, 2017. The following table summarizes the preliminary allocation of the purchase price paid and the subsequent working capital adjustment to the fair value of the net assets acquired as of the acquisition date: Accounts receivable - trade $ Inventories Prepaids and other current assets Property and equipment Goodwill Intangible assets Accounts payable and other current liabilities (957) Unfavorable lease (107) Total $ 7,385 The goodwill for the acquisition is a result of acquiring and retaining the existing workforces and expected synergies from integrating the operations into the Company. Due to the limited amount of time since the acquisition of substantially all of the assets of Arrowhead, the initial purchase price allocation is preliminary as of September 30, 2017 as the Company has not completed its analysis of working capital, the fair value of inventories, property and equipment, intangible assets and income tax liabilities . The Company expects to be able to deduct amortization of goodwill for income tax purposes over a fifteen-year period. The acquisition was accounted for under the purchase method, and accordingly, the results of operations are included in the Company’s financial statements from the date of acquisition. From the date of acquisition through September 30, 2017, the Arrowhead assets contributed $3,379 of revenues and ($100) of pre-tax operating loss to the Company. On July 15, 2016, the Company acquired substantially all of the assets of Dejana Truck & Utility Equipment Company, Inc. and certain entities directly or indirectly owned by Peter Paul Dejana Family Trust Dated 12/31/98 (“Dejana”) . Total consideration was $191,544 including a preliminary estimated working capital adjustment of $3,989 that reduced the purchase price at the close of the transaction on July 15, 2016 that was subsequently adjusted by $5,417 paid by the Company to the seller. Thus, the net working capital adjustment paid to the former owners of Dejana was $1,428 in addition to contingent consideration with an estimated fair value of $10,200. The acquisition was financed through exercising the accordion feature on the Company’s term loan for $130,000 less an original issue discount of $650 and $20,000 of short term revolver borrowings and through the use of $31,994 of on hand cash. The Company incurred $2,096 and $2,841 of transaction expenses related to this acquisition that are included in selling, general and administrative expense in the Condensed Consolidated Statements of Income in the three and nine months ended September 30, 2016, respectively. The Dejana purchase agreement includes contingent consideration in the form of an earnout capped at $26,000. Under the earnout agreement, the former owners of Dejana are entitled to receive payments contingent upon the revenue growth and financial performance of the acquired business for the years 2016, 2017, and 2018. There is no requirement for continued employment related to the contingent consideration, and thus the earnout is recorded as a component of purchase price. The preliminary estimated fair value of the earnout consideration was $10,200, which was further adjusted at December 31, 2016 to $10,373 as a result of the 2016 performance exceeding the 2016 fair value established at the opening balance sheet by $173. As a result of the year ending December 31, 2016 financial results, the new possible range of outcomes was reduced from $26,000 to a maximum earnout of $21,487. The Company made a payment to the former owners of Dejana of $5,487 in the nine months ended September 30, 2017. The earnout agreement was amended on September 20, 2017 to extend the earnout measurement periods for an additional two years, namely the fiscal years ended December 31, 2019 and December 31, 2020, with the potential for the former owners of Dejana to earn up to 50% of the remaining earnout payments unearned based on the original earnout targets and measurement periods. The most recent valuation resulted in a fair value adjustment to the earnout of ($1,186), which is included in selling, general and administrative expense in the Condensed Consolidated Statements of Income for the three and nine months ended September 30, 2017. The following table summarizes the preliminary allocation of the purchase price paid and the subsequent working capital adjustment to the fair value of the net assets acquired as of the acquisition date: Accounts receivable $ Inventories Truck chassis floor plan inventory Prepaids and other current assets Property and equipment Goodwill Intangible assets Other assets - long term Accounts payable and other current liabilities (3,881) Floor plan obligations (13,479) Earnout (10,200) Total $ 181,344 The goodwill for the acquisition is a result of acquiring and retaining the existing workforces and expected synergies from integrating the operations into the Company. The Company expects to be able to deduct amortization of goodwill for income tax purposes over a fifteen-year period. The acquisition was accounted for under the purchase method, and accordingly, the results of operations are included in the Company’s financial statements from the date of acquisition. The following unaudited pro forma information presents the combined results of operations of the Company and Dejana for the three and nine months ended September 30, 2016 as if the acquisition had occurred on January 1, 2015, with pro forma adjustments to give effect to amortization of intangible assets, depreciation of fixed assets, an increase in interest expense from the acquisition financing and certain other adjustments: Three Months Ended Nine Months Ended September 30, September 30, 2016 2016 Net sales $ $ Net income $ $ Earnings per common share assuming dilution attributable to common shareholders $ $ The unaudited pro forma information above includes the historical financial results of the Company and Dejana, adjusted to record depreciation and intangible asset amortization related to valuation of the acquired tangible and intangible assets at fair value and the addition of incremental costs related to debt to finance the acquisition, and the tax benefits related to the increased costs. This information is presented for information purposes only and is not necessarily indicative of what the Company’s results of operations would have been had the acquisition been in effect for the periods presented or future results. |
Fair Value
Fair Value | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value | |
Fair Value | 3. Fair Value Fair value is the price at which an asset could be exchanged in a current transaction between knowledgeable, willing parties. A liability’s fair value is defined as the amount that would be paid to transfer the liability to a new obligor, not the amount that would be paid to settle the liability with the creditor. Fair value measurements are categorized into one of three levels based on the lowest level of significant input used: Level 1 (unadjusted quoted prices in active markets); Level 2 (observable market inputs available at the measurement date, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be corroborated by observable market data). The following table presents financial assets and liabilities measured at fair value on a recurring basis and discloses the fair value of long-term debt: Fair Value at Fair Value at September 30, December 31, 2017 2016 Assets: Other long-term assets (a) $ 4,634 $ 3,458 Total Assets $ 4,634 $ 3,458 Liabilities: Interest rate swaps (b) $ 2,781 $ 1,985 Long term debt (c) 312,297 315,940 Earnout - Henderson (d) 553 636 Earnout - Dejana (e) 3,700 10,373 Total Liabilities $ 319,331 $ 328,934 (a) Included in other assets is the cash surrender value of insurance policies on various individuals that are associated with the Company. The carrying amount of these insurance policies approximates their fair value and is considered Level 2 inputs . (b) Valuation models are calibrated to initial trade price. Subsequent valuations are based on observable inputs to the valuation model (e.g. interest rates and credit spreads). Model inputs are changed only when corroborated by market data. A credit risk adjustment is made on each swap using observable market credit spreads. Thus, inputs used to determine fair value of the interest rate swap are Level 2 inputs. Interest rate swaps of $608 and $2,173 at September 30, 2017 are included in Accrued expenses and other current liabilities and Other long-term liabilities, respectively . Interest rate swaps of $335 and $1,650 at December 31, 2016 are included in Accrued expenses and other current liabilities and Other long-term liabilities, respectively. (c) The fair value of the Company’s long-term debt, including current maturities, is estimated using discounted cash flows based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements, which is a Level 2 input for all periods presented. Meanwhile, long-term debt is recorded at carrying amount, net of discount and deferred debt issuance costs, as disclosed on the face of the balance sheet. (d) Included in Accrued expenses and other current liabilities and Other long term liabilities in the amounts of $111 and $442, respectively, at September 30, 2017 is the fair value of an obligation for a portion of the potential earnout acquired in conjunction with the acquisition of Henderson Enterprise Group, Inc. (“Henderson”). Included in Accrued expenses and other current liabilities and Other long term liabilities in the amounts of $235 and $442, respectively, at September 30, 2016 is the fair value of an obligation for a portion of the potential earnout acquired in conjunction with the acquisition of Henderson. Fair value is based upon Level 3 discounted cash flow analysis using key inputs of forecasted future sales as well as a growth rate reduced by the market required rate of return. See reconciliation of liability included below: Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2017 2016 2016 Beginning Balance $ 580 $ 636 $ 705 $ 761 Additions — — — — Adjustments to fair value — — — — Payment to former owners (27) (83) (28) (84) Ending balance $ 553 $ 553 $ 677 $ 677 (e) Included in Other long term liabilities in the amount of $3,700 at September 30, 2017 is the fair value of an obligation for a portion of the potential earnout incurred in conjunction with the acquisition of Dejana. Included in Accrued expenses and other current liabilities and Other long term liabilities in the amounts of $5,314 and $4,886, respectively, at September 30, 2016 is the fair value of an obligation for a portion of the potential earnout incurred in conjunction with the acquisition of Dejana. Fair value is based upon Level 3 inputs of a real options approach where gross sales were simulated in a risk-neutral framework using Geometric Brownian Motion, a well-accepted model of stock price behavior that is used in option pricing models such as the Black-Scholes option pricing model, using key inputs of forecasted future sales and financial performance as well as a risk adjusted expected growth rate adjusted appropriately based on its correlation with the market. See reconciliation of liability included below: Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2017 2016 2016 Beginning Balance $ 4,886 $ 10,373 $ — $ — Additions — — 10,200 10,200 Adjustments to fair value (1,186) (1,186) — — Payment to former owners — (5,487) — — Ending balance $ 3,700 $ 3,700 $ 10,200 $ 10,200 |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2017 | |
Inventories | |
Inventories | 4. Inventories Inventories consist of the following: September 30, December 31, 2017 2016 Finished goods and work-in-process $ 46,183 $ 44,047 Raw material and supplies 31,264 26,824 $ 77,447 $ 70,871 The inventories in the table above do not include truck chassis inventory financed through a floor plan financing agreement as discussed in Note 6. The Company takes title to truck chassis upon receipt of the inventory through its floor plan agreement and performs up-fitting service installations to the truck chassis inventory during the installation period. The floor plan obligation is then assumed by the dealer customer upon delivery. At September 30, 2017 and December 31, 2016, the Company had $6,034 and $3,939 of chassis inventory and related floor plan financing obligation, respectively. The Company recognizes revenue associated with up-fitting and service installations net of the truck chassis. Unlike the floor plan agreement, the Company does not record inventory related to the truck chassis acquired through the bailment pool agreement as these truck chassis are held on consignment. Like the revenue recognized on floor plan arrangement, revenue recognized for up-fitting services on chassis acquired through the bailment agreement are also recognized net of the truck chassis. |
Property, plant and equipment
Property, plant and equipment | 9 Months Ended |
Sep. 30, 2017 | |
Property, plant and equipment | |
Property, plant and equipment | 5. Property, plant and equipment Property, plant and equipment are summarized as follows: September 30, December 31, 2017 2016 Land $ $ 2,378 Land improvements Leasehold Improvements Buildings Machinery and equipment Furniture and fixtures Mobile equipment and other Construction-in-process 3,850 Total property, plant and equipment Less accumulated depreciation (49,447) (44,383) Net property, plant and equipment $ $ |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2017 | |
Long-Term Debt | |
Long-Term Debt | 6. Long-Term Debt Long-term debt is summarized below: September 30, December 31, 2017 2016 Term Loan, net of debt discount of $1,660 and $1,953 at September 30, 2017 and December 31, 2016, respectively $ $ Less current maturities 2,749 2,829 Long term debt before deferred financing costs Deferred financing costs, net 3,415 4,033 Long term debt, net $ 305,354 $ 306,726 On February 8, 2017 the Company entered into an amendment to its senior secured term loan facility (the “Term Loan Credit Agreement”) to decrease the interest rate margins that apply to the term loan facility from 3.25% to 2.50% for ABR Loans (as defined in the Term Loan Credit Agreement) and from 4.25% to 3.50% for Eurodollar Rate Loans (as defined in the Term Loan Credit Agreement), such that the senior secured term loan facility generally bears interest at a rate of (at the Company’s election) either (i) 2.50% per annum plus the greatest of (a) the Prime Rate (as defined in the Term Loan Credit Agreement) in effect on such day, (b) the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers plus 0.50% and (c) 1.00% plus the greater of (1) the LIBOR for a one month interest period multiplied by the Statutory Reserve Rate (as defined in the Term Loan Credit Agreement) and (2) 2.00% or (ii) 3.50% per annum plus the greater of (a) the LIBOR for the applicable interest period multiplied by the Statutory Reserve Rate and (b) 1.00%. Meanwhile the discount, principal and tenure of the Company’s Term Loan Credit Agreement has remained unchanged. The amendment to the Term Loan Credit Agreement did not result in a significant debt modification under ASC 470-50. Additionally, the Company incurred approximately $932 in costs with third parties directly related to the amendment that the Company expensed as incurred in the nine months ended September 30, 2017. On August 17, 2017 the Company entered into an amendment to the Term Loan Credit Agreement to further decrease the interest rate margins that apply to the term loan facility from 2.50% to 2.00% for ABR Loans (as defined in the Term Loan Credit Agreement) and from 3.50% to 3.00% for Eurodollar Rate Loans (as defined in the Term Loan Credit Agreement), such that the senior secured term loan facility generally bears interest at a rate of (at the Company’s election) either (i) 2.00% per annum plus the greatest of (a) the Prime Rate (as defined in the Term Loan Credit Agreement) in effect on such day, (b) the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers plus 0.50% and (c) 1.00% plus the greater of (1) the LIBOR for a one month interest period multiplied by the Statutory Reserve Rate (as defined in the Term Loan Credit Agreement) and (2) 2.00% or (ii) 3.00% per annum plus the greater of (a) the LIBOR for the applicable interest period multiplied by the Statutory Reserve Rate and (b) 1.00%. Meanwhile the discount, principal and tenure of the Company’s Term Loan Credit Agreement has remained unchanged. The amendment to the Term Loan Credit Agreement did not result in a significant debt modification under ASC 470-50. Additionally, the Company incurred approximately $676 in costs with third parties directly related to the amendment that the Company expensed as incurred in the three and nine months ended September 30, 2017. The Term Loan Credit Agreement amortizes in nominal amounts quarterly with the balance payable on December 31, 2021. The Term Loan Credit Agreement also allows the Company to request the establishment of one or more additional term loan commitments in an aggregate amount not in excess of $80,000 subject to specified terms and conditions, which amount may be further increased so long as the First Lien Debt Ratio (as defined in the Term Loan Credit Agreement) is not greater than 3.25 to 1.00. The Term Loan Credit Agreement permits the Company to enter into floor plan financing arrangements in an aggregate amount not to exceed $20,000 under both the term loan and revolving credit facility. The Company’s senior credit facilities also include a $100,000 revolving credit facility (the “Revolving Credit Agreement”) with a group of banks, of which $10,000 is available in the form of letters of credit and $5,000 is available for the issuance of short-term swing line loans . The Revolving Credit Agreement provides that the Company has the option to select whether borrowings will bear interest at either (i) a margin ranging from 1.50% to 2.00% per annum, depending on the utilization of the facility, plus the LIBOR for the applicable interest period multiplied by the Statutory Reserve Rate (as defined in the Revolving Credit Agreement) or (ii) a margin ranging from 0.50% to 1.00% per annum, depending on the utilization of the facility, plus the greatest of (a) the Prime Rate (as defined in the Revolving Credit Agreement) in effect on such day, (b) the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers plus 0.50% and (c) the LIBOR for a one month interest period multiplied by the Statutory Reserve Rate plus 1%. The maturity date for the Revolving Credit Agreement is June 30, 2021. The Term Loan Credit Agreement was originally issued at a $1,900 discount and the incremental term loan used to fund the Dejana acquisition on July 15, 2016 was issued at a $650 discount both of which are being amortized over the term of the term loan. At September 30, 2017, the Company had outstanding borrowings under the Term Loan Credit Agreement of $311,518, and outstanding borrowings of $23,000 on the Revolving Credit Agreement and remaining borrowing availability of $74,186. At December 31, 2016, the Company had outstanding borrowings under the Term Loan Credit Agreement of $313,588, no outstanding borrowings on the Revolving Credit Agreement at December 31, 2016 and remaining borrowing availability of $89,664. The Company’s senior credit facilities include certain negative and operating covenants, including restrictions on its ability to pay dividends, and other customary covenants, representations and warranties and events of default. The senior credit facilities entered into and recorded by the Company’s subsidiaries significantly restrict its subsidiaries from paying dividends and otherwise transferring assets to Douglas Dynamics, Inc. The terms of the Revolving Credit Agreement specifically restrict subsidiaries from paying dividends if a minimum availability under the Revolving Credit Agreement is not maintained, and both senior credit facilities restrict subsidiaries from paying dividends above certain levels or at all if an event of default has occurred. These restrictions would affect the Company indirectly since the Company relies principally on distributions from its subsidiaries to have funds available for the payment of dividends. In addition, the Revolving Credit Agreement includes a requirement that, subject to certain exceptions, capital expenditures may not exceed $12,500 in any calendar year (plus the unused portion of permitted capital expenditures from the preceding year subject to a $12,500 cap and a separate one-time $15,000 capital expenditures to be used for the consolidation of facilities and costs associated with the acquiring and/or development and construction of one new manufacturing facility) and, if certain minimum availability under the Revolving Credit Agreement is not maintained, that the Company comply with a monthly minimum fixed charge coverage ratio test of 1.0:1.0. Compliance with the fixed charge coverage ratio test is subject to certain cure rights under the Revolving Credit Agreement. At September 30, 2017, the Company was in compliance with the respective covenants. The credit facilities are collateralized by substantially all assets of the Company. In accordance with the senior credit facilities, the Company is required to make additional principal prepayments over the above scheduled payments under certain conditions. This includes, in the case of the term loan facility, 100% of the net cash proceeds of certain asset sales, certain insurance or condemnation events, certain debt issuances, and, within 150 days of the end of each fiscal year, 50% of consolidated excess cash flow including a deduction for certain distributions (which percentage is reduced to 0% upon the achievement of certain leverage ratio thresholds), for such fiscal year. Consolidated excess cash flow is defined in the senior credit facilities as consolidated adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) plus a consolidated working capital adjustment, less the sum of repayments of debt and capital expenditures (subject to certain adjustments), interest and taxes paid in cash, management fees and certain restricted payments (including certain dividends or distributions). Consolidated working capital adjustment is defined in the senior credit facilities as the change in working capital, defined as current assets, excluding cash and cash equivalents, less current liabilities, excluding the current portion of long term debt. As of September 30, 2017, the Company was not required to make an excess cash flow payment. The Company entered into interest rate swap agreements on February 20, 2015 to reduce its exposure to interest rate volatility. The three interest rate swap agreements have notional amounts of $45,000, $90,000 and $135,000 effective for the periods December 31, 2015 through March 29, 2018, March 29, 2018 through March 31, 2020 and March 31, 2020 through June 30, 2021, respectively. The interest rate swaps’ negative fair value at September 30, 2017 was $2,781, of which $608 and $2,173 are included in Accrued expenses and other current liabilities and Other long-term liabilities on the Condensed Consolidated Balance Sheet, respectively. Meanwhile, the interest rate swaps’ negative fair value at December 31, 2016 was $1,985, of which $335 and $1,650 are included in Accrued expenses and other current liabilities and Other long-term liabilities on the Condensed Consolidated Balance Sheet, respectively. The Company may have counterparty credit risk resulting from the interest rate swap, which it monitors on an on-going basis. This risk lies with one global financial institution. Under the interest rate swap agreement, effective as of December 31, 2015, the Company will either receive or make payments on a monthly basis based on the differential between 6.105% and LIBOR plus 4.25% (with a LIBOR floor of 1.0%). Under the interest rate swap agreement, effective as of March 29, 2018, the Company will either receive or make payments on a monthly basis based on the differential between 6.916% and LIBOR plus 4.25% (with a LIBOR floor of 1.0%). Under the interest rate swap agreement, effective as of March 31, 2020, the Company will either receive or make payments on a monthly basis based on the differential between 7.168% and LIBOR plus 4.25% (with a LIBOR floor of 1.0%). The Company receives on consignment, truck chassis on which it performs up-fitting service installations under “bailment pool” arrangements with major truck manufacturers. The Company never receives title to the truck chassis. The aggregate value of all bailment pool chassis on hand as of September 30, 2017 and December 31, 2016 were $15,447 and $22,420, respectively. The Company is responsible to the manufacturer for interest on chassis held for up-fitting. Interest rates vary depending on the number of days in the bailment pool. As of September 30, 2017, rates were based on prime plus a margin ranging from 0% to 8%. During the three months and nine months ended September 30, 2017, the Company incurred $52 and $187 in interest on the bailment pool arrangement, respectively. During the three months and nine months ended September 30, 2016, the Company incurred $25 in interest on the bailment pool arrangement. The Company has a floor plan line of credit for up to $20,000 with a financial institution. The terms of the line of credit are contained in a credit agreement dated July 15, 2016 and expired on July 31, 2017, which the Company has renewed through December 31, 2018. Under the floor plan agreement the Company receives truck chassis and title on up-fitting service installations. Upon up-fit completion, the title transfers from the Company to the dealer customer. The note bears interest at an adjusted LIBOR rate, plus an applicable rate of 1.75%. The obligation under the floor plan agreement was $6,034 and $3,939 at September 30, 2017 and December 31, 2016, respectively. During the three and nine months ended September 30, 2017, the Company incurred $52 and $134 in interest on the floor plan arrangements, respectively. During the three and nine months ended September 30, 2016, the Company incurred $56 in interest on the floor plan arrangements. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 9 Months Ended |
Sep. 30, 2017 | |
Accrued Expenses and Other Current Liabilities | |
Accrued Expenses and Other Current Liabilities | 7. Accrued Expenses and Other Current Liabilities Accrued expenses and other liabilities are summarized as follows: September 30, December 31, 2017 2016 Payroll and related costs $ $ Employee benefits Accrued warranty Earnout - Dejana (current) - Other $ $ |
Warranty Liability
Warranty Liability | 9 Months Ended |
Sep. 30, 2017 | |
Warranty Liability | |
Warranty Liability | 8. Warranty Liability The Company accrues for estimated warranty costs as sales are recognized and periodically assesses the adequacy of its recorded warranty liability and adjusts the amount as necessary. The Company’s warranties generally provide, with respect to its snow and ice control equipment, that all material and workmanship will be free from defect for a period of two years after the date of purchase by the end-user, and with respect to its parts and accessories purchased separately, that such parts and accessories will be free from defect for a period of one year after the date of purchase by the end-user. Certain snowplows only provide for a one year warranty. The Company determines the amount of the estimated warranty costs (and its corresponding warranty reserve) based on the Company’s prior five years of warranty history utilizing a formula driven by historical warranty expense and applying management’s judgment. The Company adjusts its historical warranty costs to take into account unique factors such as the introduction of new products into the marketplace that do not provide a historical warranty record to assess. The warranty reserve is $5,817 at September 30, 2017 of which $2,453 is included in Other long term liabilities and $3,364 is included in Accrued expenses and other current liabilities in the accompanying Condensed Consolidated Balance Sheet. The warranty reserve was $6,160 at December 31, 2016 of which $2,625 is included in Other long term liabilities and $3,535 is included in Accrued expenses and other current liabilities in the accompanying Condensed Consolidated Balance Sheet. The following is a rollforward of the Company’s warranty liability: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Balance at the beginning of the period $ 5,575 $ 6,297 $ 6,160 $ 7,423 Establish warranty provision for acquired companies - 35 65 35 Warranty provision 615 750 2,178 1,940 Claims paid/settlements (373) (572) (2,586) (2,888) Balance at the end of the period $ 5,817 $ 6,510 $ 5,817 $ 6,510 |
Employee Retirement Plans
Employee Retirement Plans | 9 Months Ended |
Sep. 30, 2017 | |
Employee Retirement Plans | |
Employee Retirement Plans | 9. Employee Retirement Plans The components of net periodic pension cost consist of the following: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Component of net periodic pension cost: Service cost $ 89 $ 80 $ 267 $ 241 Interest cost 403 410 1,209 1,229 Expected return on plan assets (448) (456) (1,344) (1,368) Amortization of net loss 181 181 543 543 Net periodic pension cost $ 225 $ 215 $ 675 $ 645 The Company estimates its total required minimum contributions to its pension plans in 2017 will be $216. Through September 30, 2017, the Company has made $655 of cash contributions to the pension plans versus $711 through the same period in 2016. Components of net periodic other postretirement benefit cost consist of the following: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Component of periodic other postretirement benefit cost: Service cost $ 51 $ 52 $ 153 $ 158 Interest cost 70 69 210 209 Amortization of net gain (27) (31) (81) (95) Net periodic other postretirement benefit cost $ 94 $ 90 $ 282 $ 272 |
Earnings (Loss) per Share
Earnings (Loss) per Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings (Loss) per Share | |
Earnings (Loss) per Share | 10. Earnings per Share Basic earnings per share of common stock is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share of common stock is computed by dividing net income by the weighted average number of common shares, using the two-class method. As the Company has granted restricted stock units (“RSUs”) that both participate in dividend equivalents and do not participate in dividend equivalents, the Company has calculated earnings per share pursuant to the two-class method, which is an earnings allocation formula that determines earnings per share for common stock and participating securities according to dividends declared and participation rights in undistributed earnings. Under this method, all earnings (distributed and undistributed) are allocated to common shares and participating securities based on their respective rights to receive dividends. Diluted net income per share is calculated by dividing net income attributable to common stockholders as adjusted for the effect of dilutive non-participating securities, by the weighted average number of common stock and dilutive common stock outstanding during the period. Potential common shares in the diluted net earnings per share computation are excluded to the extent that they would be anti-dilutive. Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Basic earnings per common share Net income $ 9,327 $ 7,302 $ 20,796 $ 28,908 Less income allocated to participating securities 117 101 268 390 Net income allocated to common shareholders $ 9,210 $ 7,201 $ 20,528 $ 28,518 Weighted average common shares outstanding 22,590,897 22,501,640 22,571,560 22,473,642 $ 0.41 $ 0.32 $ 0.91 $ 1.27 Earnings per common share assuming dilution Net income $ 9,327 $ 7,302 $ 20,796 $ 28,908 Less income allocated to participating securities 117 101 268 390 Net income allocated to common shareholders $ 9,210 $ 7,201 $ 20,528 $ 28,518 Weighted average common shares outstanding 22,590,897 22,501,640 22,571,560 22,473,642 Incremental shares applicable to non-participating RSUs 14,024 - 10,942 - Weighted average common shares assuming dilution 22,604,921 22,501,640 22,582,502 22,473,642 $ 0.40 $ 0.32 $ 0.90 $ 1.26 |
Stock Based Compensation
Stock Based Compensation | 9 Months Ended |
Sep. 30, 2017 | |
Stock Based Compensation | |
Stock Based Compensation | 11. Employee Stock Plans In March 2016, the FASB issued Accounting Standards Update (“ ASU”) No. 2016-09, Stock-based Compensation: Improvements to Employee Share-based Payment Accounting , which simplifies several aspects of the accounting for share-based payment transactions, including the accounting for income taxes, forfeitures, statutory tax withholding requirements, and statement of cash flow classification. The amended guidance became effective for the Company commencing in the first quarter of 2017. The Company has implemented ASU 2016-09 as follows: o ASU 2016-09 eliminates the requirement to estimate and apply a forfeiture rate to reduce stock compensation expense during the vesting period, and instead, provides an alternative option to account for forfeitures as they occur, which is the option the Company has adopted. ASU 2016-09 requires that this change be adopted using the modified retrospective approach. The adoption of this section had no material impact on the financial statements. o ASU 2016-09 addresses the presentation of excess tax benefits and employee taxes paid on the statement of cash flows. The standard requires presentation of excess tax benefits as an operating activity on the statement of cash flows rather than as a financing activity. The Company adopted this change prospectively during the first quarter of 2017. ASU 2016-09 also requires the presentation of amounts withheld for applicable income taxes on employee share-based awards as a financing activity on the statement of cash flows, which the Company also adopted in the first quarter of 2017. o ASU No 2016-09 also eliminates additional paid in capital ("APIC") pools and requires excess tax benefits and tax deficiencies to be recorded in the income statement when the awards vest or are settled. This requirement was adopted prospectively by the Company. The impact of this section of the standard was a benefit of $616 to income tax expense for the nine month period ending September 30, 2017. In addition, the ASU requires that the excess tax benefit be removed from the overall calculation of diluted shares. The impact on diluted earnings per share of this adoption was not material. 2010 Stock Incentive Plan In May 2010, the Company’s Board of Directors and stockholders adopted the 2010 Stock Incentive Plan (the “2010 Plan”). The Company’s Board of Directors approved an amendment and restatement of the 2010 Plan on March 5, 2014, contingent on stockholder approval of the performance goals under the 2010 Plan, and the amendment and restatement became effective upon stockholder approval of the performance goals at the 2014 annual meeting of stockholders held on April 30, 2014. The 2010 Plan provides for the issuance of nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock awards and restricted stock units (“RSUs”), any of which may be performance-based, and for incentive bonuses, which may be paid in cash or stock or a combination of both, to eligible employees, officers, non-employee directors and other service providers to the Company and its subsidiaries. A maximum of 2,130,000 shares of common stock may be issued pursuant to all awards under the 2010 Plan. Performance Share Unit Awards The Company granted performance share units as performance based awards under the 2010 Plan in the first quarter of 2017 that are subject to performance conditions. Upon meeting the prescribed performance conditions, in the first quarter of the year subsequent to grant, employees will be issued RSUs, a portion of which will be subject to vesting over the two years following the end of the performance period. In accordance with ASC 718, such awards are being expensed over the vesting period from the date of grant through the requisite service period, based upon the most probable outcome. The fair value per share of the awards is the closing stock price on the date of grant, which was $33.60. The Company recognized $451 and $380 of compensation expense related to the awards in the three months ended September 30, 2017 and September 30, 2016, respectively. The Company recognized $1,121 and $886 of compensation expense related to the awards in the nine months ended September 30, 2017 and September 30, 2016, respectively. The unrecognized compensation expense calculated under the fair value method for shares that were, as of September 30, 2017, expected to be earned through the requisite service period was approximately $819 and is expected to be recognized through 2020. Restricted Stock Unit Awards RSUs are granted to both non-employee directors and management. RSUs do not carry voting rights. While all non-employee director RSUs participate in dividend equivalents, there are two classes of management RSUs, one for executives that participate in dividend equivalents, and a second for non-executives that do not participate in dividend equivalents. Each RSU represents the right to receive one share of the Company’s common stock and is subject to time based vesting restrictions. Participants are not required to pay any consideration to the Company at either the time of grant of a RSU or upon vesting. RSUs issued to management include a retirement provision under which members of management who either (1) are age 65 or older or (2) have at least ten years of service and are at least age 55 will continue to vest in unvested RSUs upon retirement. As the retirement provision does not qualify as a substantive service condition, the Company incurred $619 and $528 in additional expense in the first quarter of 2017 and 2016, respectively, for employees who meet the thresholds of the retirement provision. In 2013, the Company’s nominating and governance committee approved a retirement provision for the RSUs issued to non-employee directors that accelerates the vesting of such RSUs upon retirement. Such awards are fully expensed immediately upon grant in accordance with ASC 718, as the retirement provision eliminates substantive service conditions associated with the awards. A summary of RSU activity for the nine months ended September 30, 2017 is as follows: Weighted Weighted Average Average Remaining Grant Date Contractual Shares Fair value Term Unvested at December 31, 2016 $ years Granted $ years Vested (127,531) $ Cancelled and forfeited - $ - Unvested at September 30, 2017 $ years Expected to vest in the future at September 30, 2017 $ years The Company recognized $191 and $142 of compensation expense related to the RSU awards in the three months ended September 30, 2017 and September 30, 2016, respectively. The Company recognized $1,628 and $1,372 of compensation expense related to the RSU awards in the nine months ended September 30, 2017 and September 30, 2016, respectively. The unrecognized compensation expense, calculated under the fair value method for shares that were, as of September 30, 2017, expected to be earned through the requisite service period was approximately $536 and is expected to be recognized through 2020. Vested director RSUs are ‘‘settled’’ by the delivery to the participant or a designated brokerage firm of one share of common stock per vested RSU as soon as reasonably practicable following a termination of service of the participant that constitutes a separation from service, and in all events no later than the end of the calendar year in which such termination of service occurs or, if later, two and one-half months after such termination of service. Vested management RSUs are “settled” by the delivery to the participant or a designated brokerage firm of one share of common stock per vested RSU as soon as reasonably practicable following vesting. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies | |
Commitments and Contingencies | 12. Commitments and Contingencies In the ordinary course of business, the Company is engaged in various litigation including product liability and intellectual property disputes. However, the Company does not believe that any pending litigation will have a material adverse effect on its consolidated financial position. In addition, the Company is not currently a party to any environmental-related claims or legal matters. |
Segments
Segments | 9 Months Ended |
Sep. 30, 2017 | |
Segments | |
Segments | 13. Segments The Company operates through two operating segments for which separate financial information is available, and for which operating results are evaluated regularly by the Company's chief operating decision maker in determining resource allocation and assessing performance. Prior to the acquisition of Dejana on July 15, 2016, the Company operated one operating segment and one reportable business segment which consisted of the manufacture and sale of snow and ice control products. The Company’s two current reportable business segments are described below. Work Truck Attachments. The Work Truck Attachments segment includes snow and ice management attachments sold under the FISHER®, WESTERN®, HENDERSON® and SNOWEX® brands. This segment consists of our operations that, prior to our acquisition of Dejana, were our single operating segment, consisting of the manufacture and sale of snow and ice control products. Work Truck Solutions. The Work Truck Solutions segment, which was created as a result of the Dejana acquisition, includes the up-fit of market leading attachments and storage solutions for commercial work vehicles under the DEJANA® brand and its related sub-brands. Segment performance is evaluated based on segment net sales and operating income. Items not allocated to segment operating income include corporate administrative expenses and certain other amounts. No single customer’s revenues amounted to 10% or more of our total revenue. Sales are primarily within the United States and substantially all assets are located within the United States. Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Net sales Work Truck Attachments $ $ $ $ Work Truck Solutions Corporate & Eliminations (4,906) (3,982) (6,897) (3,842) $ $ $ $ Selling, general, and administrative expense Work Truck Attachments $ $ $ $ Work Truck Solutions Corporate & Eliminations 4,822 12,005 $ $ $ $ Income from operations Work Truck Attachments $ $ $ $ Work Truck Solutions (377) 5,143 (377) Corporate & Eliminations (4,924) (7,212) (12,660) (15,737) $ 19,965 $ $ 44,669 $ Depreciation Expense Work Truck Attachments $ $ $ $ Work Truck Solutions Corporate & Eliminations $ $ $ $ Assets Work Truck Attachments $ $ Work Truck Solutions Corporate & Eliminations $ $ Capital Expenditures Work Truck Attachments $ $ $ $ Work Truck Solutions Corporate & Eliminations - - - - $ $ $ $ All intersegment sales are eliminated in consolidation. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2017 | |
Income Taxes | |
Income Taxes | 14. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The largest item affecting deferred taxes is the difference between book and tax amortization of goodwill and other intangibles amortization. The Company’s effective tax rate was 38.1% and 38.5% for the three months ended September 30, 2017 and 2016, respectively. The Company’s effective tax rate was 33.9% and 37.2% for the nine months ended September 30, 2017 and 2016, respectively. The effective tax rate for the three months ended September 30, 2017 was relatively flat when compared to the same period in 2016. The effective tax rate for the nine months ended September 30, 2017 is lower than the corresponding period in 2016 due to the release of the reserve for uncertain tax positions and for excess stock compensation benefit recognized, slightly offset by changes in state deferred income tax rates. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2017 | |
Recent Accounting Pronouncements | |
Recent Accounting Pronouncements | 16. Recent Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02 Leases: Amendments to the FASB Accounting Standards Codification . ASU 2016 -02 increases transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. ASU 2016-02 will be effective for the Company beginning on January 1, 2019. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is in the process of analyzing the impact of the guidance on its inventory of lease contracts and currently intends to adopt the standard in the first quarter of fiscal 2019. The Company expects this ASU to have a material impact on its consolidated financial statements upon recognition of the lease liability and right-of-use asset for lease contracts which are currently accounted for as operating leases. In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09, " Revenue from Contracts with Customers (Topic 606)", which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. This pronouncement is effective for fiscal years beginning after December 15, 2017, including interim periods within that reporting period and is to be applied using one of two retrospective application methods, with early application permitted for fiscal reporting periods beginning after December 15, 2016. The Company has developed a project plan with respect to its implementation of this standard, including identification of revenue streams and reviews of contracts and procedures currently in place, and is evaluating the impact on the Company’s financial position, results of operations and cash flows. The adoption of this guidance will result in increased disclosures to help users of financial statements understand the nature, amount, and timing of revenue and cash flows arising from contracts. The Company expects to adopt the ASU using the modified retrospective method, which will be applied to all contracts not completed as of the date of initial application. Upon adoption, the Company will recognize the cumulative effect of adopting the guidance as an adjustment to the opening balance of retained earnings. The Company is in the process of identifying and implementing changes to processes and controls to meet the standard’s updated reporting and disclosure requirements and continues to update its assessment of the impact of the standard. In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04, “ Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ” (“ASU 2017-04”). This standard simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test, which required a hypothetical purchase price allocation to measure goodwill impairment. Under the new guidance, the amount of goodwill impairment will be determined by the amount the carrying value of the reporting unit exceeds its fair value. ASU 2017-04 is required to be applied on a prospective basis. The Company adopted ASU 2017-04 effective January 1, 2017. The adoption of this standard did not impact the Company’s condensed consolidated financial statements, as no triggering events or indicators of potential impairment were identified during the nine months ended September 30, 2017 and the Company performs its annual goodwill impairment test in the fourth quarter of each fiscal year. In March 2017, the FASB issued ASU No. 2017-07, Compensation-Retirement Benefits (Topic 715), Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The standard requires that an employer report the service cost component in the same line items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside of operating profit. The standard is effective for public companies for annual periods beginning after December 15, 2017, including interim periods within those annual periods. Prior periods are required to be recast. We will adopt this standard as of January 1, 2018. Net periodic benefit cost for pensions and other postretirement benefits for the nine months ended September 30, 2017 and 2016 were $957 and $917 of which $420 and $399, respectively, related to service cost. In May 2017, the FASB issued ASU 2017-09, “ Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting ” (“ASU 2017-09”). This standard clarifies when to account for a change in the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award changes as a result of a change in terms or conditions. No other changes were made to the current guidance on stock compensation. ASU 2017-09 is required to be applied on a prospective basis. The Company adopted ASU 2017-09 effective April 1, 2017. The adoption of this standard did not impact the Company’s condensed consolidated financial statements for the three and nine months ended September 30, 2017. |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Summary of the preliminary allocation of the purchase price paid to the fair value of the net assets acquired as of the acquisition date | Accounts receivable $ Inventories Truck chassis floor plan inventory Prepaids and other current assets Property and equipment Goodwill Intangible assets Other assets - long term Accounts payable and other current liabilities (3,881) Floor plan obligations (13,479) Earnout (10,200) Total $ 181,344 |
Unaudited proforma information | Three Months Ended Nine Months Ended September 30, September 30, 2016 2016 Net sales $ $ Net income $ $ Earnings per common share assuming dilution attributable to common shareholders $ $ |
Arrowhead Equipment, Inc. [Member] | |
Summary of the preliminary allocation of the purchase price paid to the fair value of the net assets acquired as of the acquisition date | Accounts receivable - trade $ Inventories Prepaids and other current assets Property and equipment Goodwill Intangible assets Accounts payable and other current liabilities (957) Unfavorable lease (107) Total $ 7,385 |
Fair Value (Tables)
Fair Value (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Schedule of financial assets and liabilities measured at fair value on a recurring basis and disclosure of the fair value of long-term debt | Fair Value at Fair Value at September 30, December 31, 2017 2016 Assets: Other long-term assets (a) $ 4,634 $ 3,458 Total Assets $ 4,634 $ 3,458 Liabilities: Interest rate swaps (b) $ 2,781 $ 1,985 Long term debt (c) 312,297 315,940 Earnout - Henderson (d) 553 636 Earnout - Dejana (e) 3,700 10,373 Total Liabilities $ 319,331 $ 328,934 (a) Included in other assets is the cash surrender value of insurance policies on various individuals that are associated with the Company. The carrying amount of these insurance policies approximates their fair value and is considered Level 2 inputs . (b) Valuation models are calibrated to initial trade price. Subsequent valuations are based on observable inputs to the valuation model (e.g. interest rates and credit spreads). Model inputs are changed only when corroborated by market data. A credit risk adjustment is made on each swap using observable market credit spreads. Thus, inputs used to determine fair value of the interest rate swap are Level 2 inputs. Interest rate swaps of $608 and $2,173 at September 30, 2017 are included in Accrued expenses and other current liabilities and Other long-term liabilities, respectively . Interest rate swaps of $335 and $1,650 at December 31, 2016 are included in Accrued expenses and other current liabilities and Other long-term liabilities, respectively. (c) The fair value of the Company’s long-term debt, including current maturities, is estimated using discounted cash flows based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements, which is a Level 2 input for all periods presented. Meanwhile, long-term debt is recorded at carrying amount, net of discount and deferred debt issuance costs, as disclosed on the face of the balance sheet. (d) Included in Accrued expenses and other current liabilities and Other long term liabilities in the amounts of $111 and $442, respectively, at September 30, 2017 is the fair value of an obligation for a portion of the potential earnout acquired in conjunction with the acquisition of Henderson Enterprise Group, Inc. (“Henderson”). Included in Accrued expenses and other current liabilities and Other long term liabilities in the amounts of $235 and $442, respectively, at September 30, 2016 is the fair value of an obligation for a portion of the potential earnout acquired in conjunction with the acquisition of Henderson. Fair value is based upon Level 3 discounted cash flow analysis using key inputs of forecasted future sales as well as a growth rate reduced by the market required rate of return. See reconciliation of liability included below: Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2017 2016 2016 Beginning Balance $ 580 $ 636 $ 705 $ 761 Additions — — — — Adjustments to fair value — — — — Payment to former owners (27) (83) (28) (84) Ending balance $ 553 $ 553 $ 677 $ 677 (e) Included in Other long term liabilities in the amount of $3,700 at September 30, 2017 is the fair value of an obligation for a portion of the potential earnout incurred in conjunction with the acquisition of Dejana. Included in Accrued expenses and other current liabilities and Other long term liabilities in the amounts of $5,314 and $4,886, respectively, at September 30, 2016 is the fair value of an obligation for a portion of the potential earnout incurred in conjunction with the acquisition of Dejana. Fair value is based upon Level 3 inputs of a real options approach where gross sales were simulated in a risk-neutral framework using Geometric Brownian Motion, a well-accepted model of stock price behavior that is used in option pricing models such as the Black-Scholes option pricing model, using key inputs of forecasted future sales and financial performance as well as a risk adjusted expected growth rate adjusted appropriately based on its correlation with the market. See reconciliation of liability included below: Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2017 2016 2016 Beginning Balance $ 4,886 $ 10,373 $ — $ — Additions — — 10,200 10,200 Adjustments to fair value (1,186) (1,186) — — Payment to former owners — (5,487) — — Ending balance $ 3,700 $ 3,700 $ 10,200 $ 10,200 |
Henderson | |
Schedule of reconciliation of liability | Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2017 2016 2016 Beginning Balance $ 580 $ 636 $ 705 $ 761 Additions — — — — Adjustments to fair value — — — — Payment to former owners (27) (83) (28) (84) Ending balance $ 553 $ 553 $ 677 $ 677 |
Dejana | |
Schedule of reconciliation of liability | Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2017 2016 2016 Beginning Balance $ — $ 1,606 $ 2,032 $ 1,987 Additions — — — — Adjustments to fair value — — — 313 Payment to former owners — (1,606) — (268) Ending balance $ — $ — $ 2,032 $ 2,032 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Inventories | |
Schedule of inventories | September 30, December 31, 2017 2016 Finished goods and work-in-process $ 46,183 $ 44,047 Raw material and supplies 31,264 26,824 $ 77,447 $ 70,871 |
Property, plant and equipment (
Property, plant and equipment (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Property, plant and equipment | |
Summary of property, plant and equipment | September 30, December 31, 2017 2016 Land $ $ 2,378 Land improvements Leasehold Improvements Buildings Machinery and equipment Furniture and fixtures Mobile equipment and other Construction-in-process 3,850 Total property, plant and equipment Less accumulated depreciation (49,447) (44,383) Net property, plant and equipment $ $ |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Long-Term Debt | |
Summary of long-term debt | September 30, December 31, 2017 2016 Term Loan, net of debt discount of $1,660 and $1,953 at September 30, 2017 and December 31, 2016, respectively $ $ Less current maturities 2,749 2,829 Long term debt before deferred financing costs Deferred financing costs, net 3,415 4,033 Long term debt, net $ 305,354 $ 306,726 |
Accrued Expenses and Other Cu26
Accrued Expenses and Other Current Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Accrued Expenses and Other Current Liabilities | |
Summary of accrued expenses and other current liabilities | September 30, December 31, 2017 2016 Payroll and related costs $ $ Employee benefits Accrued warranty Earnout - Dejana (current) - Other $ $ |
Warranty Liability (Tables)
Warranty Liability (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Warranty Liability | |
Schedule of rollforward of Company's warranty liability | Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Balance at the beginning of the period $ 5,575 $ 6,297 $ 6,160 $ 7,423 Establish warranty provision for acquired companies - 35 65 35 Warranty provision 615 750 2,178 1,940 Claims paid/settlements (373) (572) (2,586) (2,888) Balance at the end of the period $ 5,817 $ 6,510 $ 5,817 $ 6,510 |
Employee Retirement Plans (Tabl
Employee Retirement Plans (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Pension plan | |
Employee retirement plans | |
Schedule of components of net periodic pension or other postretirement benefit cost | Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Component of net periodic pension cost: Service cost $ 89 $ 80 $ 267 $ 241 Interest cost 403 410 1,209 1,229 Expected return on plan assets (448) (456) (1,344) (1,368) Amortization of net loss 181 181 543 543 Net periodic pension cost $ 225 $ 215 $ 675 $ 645 |
Other postretirement benefit cost | |
Employee retirement plans | |
Schedule of components of net periodic pension or other postretirement benefit cost | Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Component of periodic other postretirement benefit cost: Service cost $ 51 $ 52 $ 153 $ 158 Interest cost 70 69 210 209 Amortization of net gain (27) (31) (81) (95) Net periodic other postretirement benefit cost $ 94 $ 90 $ 282 $ 272 |
Earnings (Loss) per Share (Tabl
Earnings (Loss) per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings (Loss) per Share | |
Schedule of computation of basic and diluted earnings (loss) per share | Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Basic earnings per common share Net income $ 9,327 $ 7,302 $ 20,796 $ 28,908 Less income allocated to participating securities 117 101 268 390 Net income allocated to common shareholders $ 9,210 $ 7,201 $ 20,528 $ 28,518 Weighted average common shares outstanding 22,590,897 22,501,640 22,571,560 22,473,642 $ 0.41 $ 0.32 $ 0.91 $ 1.27 Earnings per common share assuming dilution Net income $ 9,327 $ 7,302 $ 20,796 $ 28,908 Less income allocated to participating securities 117 101 268 390 Net income allocated to common shareholders $ 9,210 $ 7,201 $ 20,528 $ 28,518 Weighted average common shares outstanding 22,590,897 22,501,640 22,571,560 22,473,642 Incremental shares applicable to non-participating RSUs 14,024 - 10,942 - Weighted average common shares assuming dilution 22,604,921 22,501,640 22,582,502 22,473,642 $ 0.40 $ 0.32 $ 0.90 $ 1.26 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Stock Based Compensation | |
Summary of RSU activity | Weighted Weighted Average Average Remaining Grant Date Contractual Shares Fair value Term Unvested at December 31, 2016 $ years Granted $ years Vested (127,531) $ Cancelled and forfeited - $ - Unvested at September 30, 2017 $ years Expected to vest in the future at September 30, 2017 $ years |
Segments (Table)
Segments (Table) | 9 Months Ended |
Sep. 30, 2017 | |
Segments | |
Schedule of assets and profit/loss of the segments | Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Net sales Work Truck Attachments $ $ $ $ Work Truck Solutions Corporate & Eliminations (4,906) (3,982) (6,897) (3,842) $ $ $ $ Selling, general, and administrative expense Work Truck Attachments $ $ $ $ Work Truck Solutions Corporate & Eliminations 4,822 12,005 $ $ $ $ Income from operations Work Truck Attachments $ $ $ $ Work Truck Solutions (377) 5,143 (377) Corporate & Eliminations (4,924) (7,212) (12,660) (15,737) $ 19,965 $ $ 44,669 $ Depreciation Expense Work Truck Attachments $ $ $ $ Work Truck Solutions Corporate & Eliminations $ $ $ $ Assets Work Truck Attachments $ $ Work Truck Solutions Corporate & Eliminations $ $ Capital Expenditures Work Truck Attachments $ $ $ $ Work Truck Solutions Corporate & Eliminations - - - - $ $ $ $ |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Loss by Component (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Changes in Accumulated Other Comprehensive Loss by Component | |
Schedule of changes to accumulated other comprehensive loss by component | Changes to accumulated other comprehensive loss by component for the nine months ended September 30, 2017 are as follows: Unrealized Net Loss Retiree on Interest Health Rate Benefit Pension Swap Obligation Obligation Total Balance at December 31, 2016 $ (1,195) $ 937 $ (6,414) $ (6,672) Other comprehensive loss before reclassifications (656) — — (656) Amounts reclassified from accumulated other comprehensive loss: (1) 164 (50) 336 450 Balance at September 30, 2017 $ (1,687) $ 887 $ (6,078) $ (6,878) (1) Amounts reclassified from accumulated other comprehensive loss: Amortization of Other Postretirement Benefit items: Actuarial gains (a) (81) Tax expense 31 Reclassification net of tax $ (50) Amortization of pension items: Actuarial losses (a) 543 Tax benefit (207) Reclassification net of tax $ 336 Realized losses on interest rate swaps reclassified to interest expense 264 Tax benefit (100) Reclassification net of tax $ 164 (a) These components are included in the computation of benefit plan costs in Note 9. Changes to accumulated other comprehensive loss by component for the nine months ended September 30, 2016 are as follows: Unrealized Net Loss Retiree on Interest Health Rate Benefit Pension Swap Obligation Obligation Total Balance at December 31, 2015 $ (937) $ 1,048 $ (6,294) $ (6,183) Other comprehensive loss before reclassifications (1,967) - - (1,967) Amounts reclassified from accumulated other comprehensive loss: (1) 181 (59) 337 459 Balance at September 30, 2016 $ (2,723) $ 989 $ (5,957) $ (7,691) (1) Amounts reclassified from accumulated other comprehensive loss: Amortization of Other Postretirement Benefit items: Actuarial gains (a) (95) Tax expense 36 Reclassification net of tax $ (59) Amortization of pension items: Actuarial losses (a) 543 Tax benefit (206) Reclassification net of tax $ 337 Realized losses on interest rate swaps reclassified to interest expense 292 Tax benefit (111) Reclassification net of tax $ 181 These components are included in the computation of benefit plan costs in Note 9. |
Basis of presentation (Details)
Basis of presentation (Details) $ in Thousands | Feb. 20, 2015contract | Sep. 30, 2017USD ($)segment | Jul. 14, 2016segment | Sep. 30, 2017USD ($)segment | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) |
Interim Consolidated Financial Information | ||||||
Number of operating segments | segment | 2 | 1 | 2 | |||
Deferred income taxes | $ 59,027 | $ 59,027 | $ 54,563 | |||
Derivative Number of Contracts | contract | 3 | |||||
Litigation proceeds | 1,275 | $ 10,050 | ||||
Accounting Standards Update 2015-17 [Member] | ||||||
Interim Consolidated Financial Information | ||||||
Deferred income taxes | $ 5,726 | $ 5,726 | $ 5,726 | |||
Interest Rate Swap Effective 31 December 2015 through 29 March 2018 | ||||||
Interim Consolidated Financial Information | ||||||
Fixed interest rate (as a percent) | 6.105% | 6.105% | ||||
Interest Rate Swap Effective 31 December 2015 through 29 March 2018 | London Interbank Offered Rate (LIBOR) | ||||||
Interim Consolidated Financial Information | ||||||
Interest rate added to variable rate (as a percent) | 4.25% | 4.25% | ||||
LIBOR floor (as a percent) | 1.00% | 1.00% | ||||
Interest Rate Swap Effective 29 March 2018 through 31 March 2020 | ||||||
Interim Consolidated Financial Information | ||||||
Fixed interest rate (as a percent) | 6.916% | 6.916% | ||||
Interest Rate Swap Effective 29 March 2018 through 31 March 2020 | London Interbank Offered Rate (LIBOR) | ||||||
Interim Consolidated Financial Information | ||||||
Interest rate added to variable rate (as a percent) | 4.25% | 4.25% | ||||
LIBOR floor (as a percent) | 1.00% | 1.00% | ||||
Interest Rate Swap Effective 31 March 2020 through 30 June 2021 | ||||||
Interim Consolidated Financial Information | ||||||
Fixed interest rate (as a percent) | 7.168% | 7.168% | ||||
Interest Rate Swap Effective 31 March 2020 through 30 June 2021 | London Interbank Offered Rate (LIBOR) | ||||||
Interim Consolidated Financial Information | ||||||
Interest rate added to variable rate (as a percent) | 4.25% | 4.25% | ||||
LIBOR floor (as a percent) | 1.00% | 1.00% |
Acquisitions - Allocation of Pu
Acquisitions - Allocation of Purchase Price (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 20, 2017 | May 01, 2017 | Jul. 15, 2016 | Jul. 15, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 |
Acquisition | ||||||||||
Working capital adjustment | $ 5,417 | |||||||||
Earnout liability | (1,186) | $ (51) | ||||||||
Allocation of the purchase price paid to the fair value of the net assets for acquisition | ||||||||||
Goodwill | $ 240,906 | $ 240,906 | 240,906 | $ 238,286 | ||||||
Revenues | 125,339 | $ 123,573 | 336,958 | 286,125 | ||||||
Pre-tax operating losses | 15,081 | 11,873 | 31,464 | 46,030 | ||||||
Dejana | ||||||||||
Acquisition | ||||||||||
Total consideration | $ 191,544 | |||||||||
Working capital adjustment | 3,989 | |||||||||
Short-term borrowings (repayments), net | 130,000 | |||||||||
Payment of working capital | $ 1,428 | |||||||||
Discount | 650 | |||||||||
Payable to former shareholder | $ 5,487 | |||||||||
Payment of on hand cash at acquisition | 31,994 | |||||||||
Adjusted fair value of earn out consideration | 10,373 | |||||||||
Subsequent adjustment | 173 | |||||||||
Maximum earnout | 21,487 | |||||||||
Earnout consideration amended period | 2 years | |||||||||
Percentage of additional earnout payment | 50.00% | |||||||||
Contingent consideration in the form of an earnout capped | 26,000 | 26,000 | $ 26,000 | |||||||
Fair value of the contingent consideration recognized | 10,200 | |||||||||
Allocation of the purchase price paid to the fair value of the net assets for acquisition | ||||||||||
Accounts receivable | 13,509 | 13,509 | ||||||||
Inventories | 20,017 | 20,017 | ||||||||
Truck chassis floor plan inventory | 13,479 | 13,479 | ||||||||
Prepaid and other current assets | 705 | 705 | ||||||||
Property and equipment | 5,821 | 5,821 | ||||||||
Goodwill | 77,354 | 77,354 | ||||||||
Intangible assets | 77,800 | 77,800 | ||||||||
Other assets, long-term | 219 | 219 | ||||||||
Accounts payable and other current liabilities | (3,881) | (3,881) | ||||||||
Floor plan obligations | (13,479) | (13,479) | ||||||||
Earnout | (10,200) | (10,200) | ||||||||
Total | 181,344 | $ 181,344 | ||||||||
Amortization period of goodwill, for income tax purpose | 15 years | |||||||||
Pro forma Information | ||||||||||
Net sales | 129,253 | 364,065 | ||||||||
Net income | $ 9,921 | $ 32,601 | ||||||||
Earnings per common share assuming dilution attributable to common shareholders | $ 0.44 | $ 1.45 | ||||||||
Dejana | Revolving credit facility | ||||||||||
Acquisition | ||||||||||
Short-term borrowings (repayments), net | $ 20,000 | |||||||||
Dejana | Selling, general and administrative expenses | ||||||||||
Acquisition | ||||||||||
Transactions expenses | $ 2,096 | $ 2,841 | ||||||||
Earnout liability | (1,186) | $ (1,186) | ||||||||
Arrowhead Equipment, Inc. [Member] | ||||||||||
Acquisition | ||||||||||
Total consideration | $ 7,385 | |||||||||
Working capital adjustment | 100 | |||||||||
proceeds from changes in working capital | 215 | |||||||||
Adjusted Working capital | 115 | |||||||||
Allocation of the purchase price paid to the fair value of the net assets for acquisition | ||||||||||
Accounts receivable | 852 | |||||||||
Inventories | 1,647 | |||||||||
Prepaid and other current assets | 6 | |||||||||
Property and equipment | 624 | |||||||||
Goodwill | 2,620 | |||||||||
Intangible assets | 2,700 | |||||||||
Accounts payable and other current liabilities | (957) | |||||||||
Unfavorable lease | (107) | |||||||||
Total | $ 7,385 | |||||||||
Revenues | 3,379 | |||||||||
Pre-tax operating losses | $ (100) | |||||||||
Amortization period of goodwill, for income tax purpose | 15 years | |||||||||
Arrowhead Equipment, Inc. [Member] | Selling, general and administrative expenses | ||||||||||
Acquisition | ||||||||||
Transactions expenses | $ 70 | $ 418 |
Fair Value - Assets and Liabili
Fair Value - Assets and Liabilities on a Recurring Basis (Details) - Recurring - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Assets: | ||
Other long-term assets | $ 4,634 | $ 3,458 |
Total Assets | 4,634 | 3,458 |
Liabilities: | ||
Long term debt | 312,297 | 315,940 |
Interest rate swaps | 2,781 | 1,985 |
Total Liabilities | 319,331 | 328,934 |
Henderson | ||
Liabilities: | ||
Earnout | 553 | 636 |
Dejana | ||
Liabilities: | ||
Earnout | $ 3,700 | $ 10,373 |
Fair Value - Fair Value Liabili
Fair Value - Fair Value Liability Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Reconciliation of liability related to earnout | |||||
Balance at the beginning of the period | $ 10,373 | ||||
Additions | $ 10,200 | $ 10,200 | |||
Adjustments to fair value | (1,186) | ||||
Payments to former owners | (5,487) | ||||
Balance at the end of the period | $ 3,700 | 10,200 | 3,700 | 10,200 | |
Recurring | Henderson | |||||
Fair value liability reconciliation | |||||
Derivative Liability, Current | 235 | 235 | |||
Derivative Liability, Noncurrent | 442 | 442 | |||
Recurring | Dejana | |||||
Fair value liability reconciliation | |||||
Derivative Liability, Current | 5,314 | 5,314 | |||
Derivative Liability, Noncurrent | 4,886 | 4,886 | |||
Recurring | Level 2 | |||||
Fair value liability reconciliation | |||||
Derivative Liability, Current | 608 | 608 | $ 335 | ||
Derivative Liability, Noncurrent | 2,173 | 2,173 | $ 1,650 | ||
Recurring | Level 3 | Henderson | |||||
Reconciliation of liability related to earnout | |||||
Balance at the beginning of the period | 580 | 705 | 636 | 761 | |
Payments to former owners | (27) | (28) | (83) | (84) | |
Balance at the end of the period | 553 | $ 677 | 553 | $ 677 | |
Earnout, portion in other current liabilities | 111 | 111 | |||
Earnout, portion in other long term liabilities | 442 | 442 | |||
Recurring | Level 3 | Dejana | |||||
Reconciliation of liability related to earnout | |||||
Balance at the beginning of the period | 4,886 | ||||
Adjustments to fair value | (1,186) | ||||
Balance at the end of the period | 3,700 | 3,700 | |||
Earnout, portion in other long term liabilities | $ 3,700 | $ 3,700 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Inventories | ||
Finished goods and work-in-process | $ 46,183 | $ 44,047 |
Raw material and supplies | 31,264 | 26,824 |
Inventories | 77,447 | 70,871 |
Inventories - truck chassis floor plan | $ 6,034 | $ 3,939 |
Property, plant and equipment38
Property, plant and equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Property, plant and equipment | ||
Total property, plant and equipment | $ 102,145 | $ 96,524 |
Less accumulated depreciation | (49,447) | (44,383) |
Net property, plant and equipment | 52,698 | 52,141 |
Land | ||
Property, plant and equipment | ||
Total property, plant and equipment | 2,378 | 2,378 |
Land improvements | ||
Property, plant and equipment | ||
Total property, plant and equipment | 4,357 | 4,357 |
Leasehold Improvements | ||
Property, plant and equipment | ||
Total property, plant and equipment | 4,096 | 2,569 |
Buildings | ||
Property, plant and equipment | ||
Total property, plant and equipment | 26,342 | 26,058 |
Machinery and equipment | ||
Property, plant and equipment | ||
Total property, plant and equipment | 43,928 | 40,878 |
Furniture and fixtures | ||
Property, plant and equipment | ||
Total property, plant and equipment | 13,207 | 12,561 |
Mobile equipment and other | ||
Property, plant and equipment | ||
Total property, plant and equipment | 4,600 | 3,873 |
Construction-in-process | ||
Property, plant and equipment | ||
Total property, plant and equipment | $ 3,237 | $ 3,850 |
Long-Term Debt - Summary (Detai
Long-Term Debt - Summary (Details) $ in Thousands | Aug. 17, 2017 | Aug. 16, 2017 | Feb. 08, 2017 | Feb. 07, 2017 | Sep. 30, 2017USD ($) | Aug. 16, 2017 | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | Jul. 15, 2016USD ($) | Dec. 31, 2014USD ($) |
Long-term debt | |||||||||||
Less current maturities | $ 2,749 | $ 2,749 | $ 2,829 | ||||||||
Long-term debt, less current maturities | 305,354 | 305,354 | 306,726 | ||||||||
Deferred financing costs, net | 3,415 | 3,415 | 4,033 | ||||||||
Total long-term debt | 305,354 | 305,354 | 306,726 | ||||||||
Long-term debt, additional disclosure | |||||||||||
Financing costs | 1,608 | $ 2,250 | |||||||||
Inventories - truck chassis floor plan | 6,034 | 6,034 | 3,939 | ||||||||
Term loan facility | |||||||||||
Long-term debt | |||||||||||
Notes and Loans Payable, Current, Total | 311,518 | 311,518 | 313,588 | ||||||||
Less current maturities | 2,749 | 2,749 | 2,829 | ||||||||
Long-term debt, less current maturities | 308,769 | 308,769 | 310,759 | ||||||||
Long-term debt, additional disclosure | |||||||||||
Unamortized discount on issuance of debt | 1,660 | 1,660 | 1,953 | $ 1,900 | |||||||
Outstanding borrowings | 311,518 | 311,518 | 313,588 | ||||||||
Revolving credit facility | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Outstanding borrowings | $ 23,000 | 23,000 | 0 | ||||||||
Incremental Term Loan Facility | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Unamortized discount on issuance of debt | $ 650 | ||||||||||
Senior credit facilities | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Floor plan financing arrangements | $ 20,000 | ||||||||||
Senior credit facilities | Term loan facility | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Financing costs | $ 932 | ||||||||||
Percentage of net cash proceeds of certain asset sales, certain insurance or condemnation events, requirement for additional principal prepayments | 100.00% | ||||||||||
Percentage of excess cash flow paid as additional principal prepayments | 50.00% | ||||||||||
Reduced percentage of excess cash flow paid as additional principal prepayments upon achievement of certain leverage ratio thresholds, one | 0.00% | ||||||||||
Senior credit facilities | Term loan facility | Maximum | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Additional term loan commitments | $ 80,000 | ||||||||||
Debt ratio | 3.25 | 3.25 | |||||||||
Period before end of the fiscal year, for additional principal prepayments of debt, from excess cash flow | 150 days | ||||||||||
Senior credit facilities | Term loan facility | ABR | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Interest rate margin (as a percent) | 2.00% | 2.50% | 3.25% | 2.50% | |||||||
Senior credit facilities | Term loan facility | Euro dollar | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Interest rate margin (as a percent) | 3.00% | 3.50% | 3.50% | 4.25% | |||||||
Senior credit facilities | Term loan facility | First option | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Interest rate margin (as a percent) | 0.50% | 0.50% | |||||||||
Fixed interest rate base (as a percent) | 2.00% | 2.50% | |||||||||
Additional interest margin added to fixed and variable rates (as a percent) | 1.00% | 1.00% | |||||||||
Additional fixed interest rate spread (as a percent) | 2.00% | 2.00% | |||||||||
Senior credit facilities | Term loan facility | Second option | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Fixed interest rate base (as a percent) | 3.00% | 3.50% | |||||||||
Additional fixed interest rate spread (as a percent) | 1.00% | 1.00% | |||||||||
Senior credit facilities | Revolving credit facility | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Borrowings under senior credit facility | $ 100,000 | $ 100,000 | |||||||||
Remaining borrowing availability | $ 74,186 | 74,186 | $ 89,664 | ||||||||
Fixed charge coverage ratio to be maintained if certain minimum availability under the credit facility is not maintained. | 1 | ||||||||||
Senior credit facilities | Revolving credit facility | Maximum | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Annual acquisitions allowed | $ 12,500 | ||||||||||
Unused portion of permitted capital expenditures | 12,500 | ||||||||||
Facilities consolidation expenditure allowed | $ 15,000 | ||||||||||
Senior credit facilities | Revolving credit facility | Fixed rate | Maximum | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Fixed interest rate base (as a percent) | 2.00% | ||||||||||
Senior credit facilities | Revolving credit facility | First option | Fixed rate | Minimum | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Fixed interest rate base (as a percent) | 1.50% | ||||||||||
Senior credit facilities | Revolving credit facility | Second option | Federal funds | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Variable rate basis description | Federal funds | ||||||||||
Interest rate margin (as a percent) | 0.50% | ||||||||||
Senior credit facilities | Revolving credit facility | Second option | Fixed rate | Maximum | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Fixed interest rate base (as a percent) | 1.00% | ||||||||||
Senior credit facilities | Revolving credit facility | Second option | Fixed rate | Minimum | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Fixed interest rate base (as a percent) | 0.50% | ||||||||||
Senior credit facilities | Revolving credit facility | Second option | One month London Interbank Offered Rate | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Variable rate basis description | LIBOR for a one month interest period | ||||||||||
Interest rate margin (as a percent) | 1.00% | ||||||||||
Senior credit facilities | Revolving credit facility | Second option | Prime | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Variable rate basis description | Prime Rate | ||||||||||
Senior credit facilities | Amended term loan facility | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Financing costs | $ 676 | 676 | |||||||||
Letter of Credit | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Maximum borrowing capacity | 10,000 | 10,000 | |||||||||
Swingline loan | |||||||||||
Long-term debt, additional disclosure | |||||||||||
Maximum borrowing capacity | $ 5,000 | $ 5,000 |
Long-Term Debt - Swaps (Details
Long-Term Debt - Swaps (Details) $ in Thousands | Feb. 20, 2015USD ($)contract | Sep. 30, 2017USD ($)item | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)item | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) |
Derivative [Line Items] | ||||||
Number of interest rate swap agreements | contract | 3 | |||||
Inventories - truck chassis floor plan | $ 6,034 | $ 6,034 | $ 3,939 | |||
Bailment pool | ||||||
Derivative [Line Items] | ||||||
Bailment Pool Chasis Inventories Net | 15,447 | 15,447 | 22,420 | |||
Interest Expense, Debt | 52 | $ 25 | 187 | $ 25 | ||
Senior credit facilities | Floor plan | ||||||
Derivative [Line Items] | ||||||
Maximum borrowing capacity | 20,000 | 20,000 | ||||
Inventories - truck chassis floor plan | 6,034 | 6,034 | 3,939 | |||
Interest Expense, Debt | $ 52 | $ 56 | 134 | $ 56 | ||
Senior credit facilities | London Interbank Offered Rate (LIBOR) | Floor plan | ||||||
Derivative [Line Items] | ||||||
Interest rate margin (as a percent) | 1.75% | |||||
Minimum | Prime | Bailment pool | ||||||
Derivative [Line Items] | ||||||
Interest rate margin (as a percent) | 0.00% | |||||
Maximum | Prime | Bailment pool | ||||||
Derivative [Line Items] | ||||||
Interest rate margin (as a percent) | 8.00% | |||||
Interest rate swap | ||||||
Derivative [Line Items] | ||||||
Negative fair value | $ 2,781 | $ 2,781 | 1,985 | |||
Number of financial institutions for which the entity is exposed to counterparty credit risk | item | 1 | 1 | ||||
Interest rate swap | Accrued Expenses and Other Current Liabilities | ||||||
Derivative [Line Items] | ||||||
Negative fair value | $ 608 | $ 608 | 335 | |||
Interest rate swap | Other Noncurrent Liabilities | ||||||
Derivative [Line Items] | ||||||
Negative fair value | $ 2,173 | $ 2,173 | $ 1,650 | |||
Interest Rate Swap Effective 31 December 2015 through 29 March 2018 | ||||||
Derivative [Line Items] | ||||||
Notional amount | $ 45,000 | |||||
Fixed interest rate on derivative (as a percent) | 6.105% | 6.105% | ||||
Interest Rate Swap Effective 31 December 2015 through 29 March 2018 | London Interbank Offered Rate (LIBOR) | ||||||
Derivative [Line Items] | ||||||
Interest rate added to variable rate (as a percent) | 4.25% | 4.25% | ||||
LIBOR floor (as a percent) | 1.00% | 1.00% | ||||
Interest Rate Swap Effective 29 March 2018 through 31 March 2020 | ||||||
Derivative [Line Items] | ||||||
Notional amount | 90,000 | |||||
Fixed interest rate on derivative (as a percent) | 6.916% | 6.916% | ||||
Interest Rate Swap Effective 29 March 2018 through 31 March 2020 | London Interbank Offered Rate (LIBOR) | ||||||
Derivative [Line Items] | ||||||
Interest rate added to variable rate (as a percent) | 4.25% | 4.25% | ||||
LIBOR floor (as a percent) | 1.00% | 1.00% | ||||
Interest Rate Swap Effective 31 March 2020 through 30 June 2021 | ||||||
Derivative [Line Items] | ||||||
Notional amount | $ 135,000 | |||||
Fixed interest rate on derivative (as a percent) | 7.168% | 7.168% | ||||
Interest Rate Swap Effective 31 March 2020 through 30 June 2021 | London Interbank Offered Rate (LIBOR) | ||||||
Derivative [Line Items] | ||||||
Interest rate added to variable rate (as a percent) | 4.25% | 4.25% | ||||
LIBOR floor (as a percent) | 1.00% | 1.00% |
Accrued Expenses and Other Cu41
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Accrued Expenses and Other Current Liabilities | ||
Payroll and related costs | $ 7,104 | $ 8,731 |
Employee benefits | 4,947 | 5,179 |
Accrued warranty | 3,364 | 3,535 |
Earnout - Dejana | 5,487 | |
Other | 5,334 | 4,393 |
Accrued expenses and other current liabilities | $ 20,749 | $ 27,325 |
Warranty Liability (Details)
Warranty Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Warranty liability | |||||
Period of warranty history used in estimating warranty costs | 5 years | ||||
Other long-term liabilities | $ 16,522 | $ 16,522 | $ 15,652 | ||
Accrued expenses and other current liabilities | 20,749 | 20,749 | 27,325 | ||
Company's warranty liability: | |||||
Balance at the beginning of the period | 5,575 | $ 6,297 | 6,160 | $ 7,423 | |
Establish warranty provision for acquired companies | 35 | 65 | 35 | ||
Warranty provision | 615 | 750 | 2,178 | 1,940 | |
Claims paid/settlements | (373) | (572) | (2,586) | (2,888) | |
Balance at the end of the period | 5,817 | $ 6,510 | 5,817 | $ 6,510 | |
Warranty Reserves | |||||
Warranty liability | |||||
Other long-term liabilities | 2,453 | 2,453 | 2,625 | ||
Accrued expenses and other current liabilities | $ 3,364 | $ 3,364 | $ 3,535 | ||
Snow and ice control equipment | |||||
Warranty liability | |||||
Warranty period | 2 years | ||||
Parts and accessories | |||||
Warranty liability | |||||
Warranty period | 1 year | ||||
Certain snowplows | |||||
Warranty liability | |||||
Warranty period | 1 year |
Employee Retirement Plans (Deta
Employee Retirement Plans (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Pension plan | ||||
Components of net periodic cost: | ||||
Service cost | $ 89 | $ 80 | $ 267 | $ 241 |
Interest cost | 403 | 410 | 1,209 | 1,229 |
Expected return on plan assets | (448) | (456) | (1,344) | (1,368) |
Amortization of net (gain) loss | 181 | 181 | 543 | 543 |
Net periodic pension cost | 225 | 215 | 675 | 645 |
Employer contributions during the period | 655 | 711 | ||
Pension plan | Minimum | ||||
Components of net periodic cost: | ||||
Estimated total required contributions | 216 | 216 | ||
Other postretirement benefit cost | ||||
Components of net periodic cost: | ||||
Service cost | 51 | 52 | 153 | 158 |
Interest cost | 70 | 69 | 210 | 209 |
Amortization of net (gain) loss | (27) | (31) | (81) | (95) |
Net periodic pension cost | $ 94 | $ 90 | $ 282 | $ 272 |
Earnings (Loss) per Share (Deta
Earnings (Loss) per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Basic earnings (loss) per common share | ||||
Net income | $ 9,327 | $ 7,302 | $ 20,796 | $ 28,908 |
Less income (loss) allocated to participating securities | 117 | 101 | 268 | 390 |
Net income (loss) attributable to common shareholders | $ 9,210 | $ 7,201 | $ 20,528 | $ 28,518 |
Weighted average common shares outstanding | 22,590,897 | 22,501,640 | 22,571,560 | 22,473,642 |
Basic earnings (loss) per common share (in dollars per share) | $ 0.41 | $ 0.32 | $ 0.91 | $ 1.27 |
Earnings per common share assuming dilution | ||||
Net income | $ 9,327 | $ 7,302 | $ 20,796 | $ 28,908 |
Less income (loss) allocated to participating securities | 117 | 101 | 268 | 390 |
Net income (loss) attributable to common shareholders | $ 9,210 | $ 7,201 | $ 20,528 | $ 28,518 |
Weighted average common shares outstanding | 22,590,897 | 22,501,640 | 22,571,560 | 22,473,642 |
Incremental shares applicable to non-participating RSUs | 14,024 | 10,942 | ||
Weighted average common shares assuming dilution | 22,604,921 | 22,501,640 | 22,582,502 | 22,473,642 |
Earnings (loss) per common share assuming dilution (in dollars per share) | $ 0.40 | $ 0.32 | $ 0.90 | $ 1.26 |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Restricted Stock Awards and Units (Details) - $ / shares | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | |
2010 Plan | |||
Stock-based compensation | |||
Maximum number of shares of common stock that may be issued | 2,130,000 | 2,130,000 | |
Performance Share Unit Awards | 2010 Plan | |||
Weighted Average Grant Date Fair Value | |||
Granted (in dollars per share) | $ 33.60 | ||
Restricted Stock Unit Awards | |||
Shares | |||
Unvested at the beginning of the period (in shares) | 47,790 | ||
Granted (in shares) | 127,750 | ||
Vested (in shares) | (127,531) | ||
Unvested at the end of the period (in shares) | 48,009 | 48,009 | 47,790 |
Expected to vest in the future, at the end of the period (in shares) | 48,009 | 48,009 | |
Weighted Average Grant Date Fair Value | |||
Unvested at the beginning of the period (in dollars per share) | $ 20.31 | ||
Granted (in dollars per share) | 24.15 | ||
Vested (in dollars per share) | 22.94 | ||
Cancelled and forfeited (in dollars per share) | 0 | ||
Unvested at the end of the period (in dollars per share) | $ 23.56 | 23.56 | $ 20.31 |
Expected to vest in the future, at the end of the period (in dollars per share) | $ 23.56 | $ 23.56 | |
Weighted Average Remaining Contractual Term | |||
Unvested at the beginning of the period | 1 year | 11 months 16 days | |
Granted | 4 months 2 days | ||
Unvested at the end of the period | 1 year | 11 months 16 days | |
Expected to vest in future, at the end of the period | 1 year |
Stock Based Compensation - Addi
Stock Based Compensation - Additional Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2017USD ($)ageshares | Mar. 31, 2017USD ($) | Sep. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | |
Additional Employee Stock Plans Information | ||||||
Income tax expense | $ 5,754 | $ 4,571 | $ 10,668 | $ 17,122 | ||
Performance Share Unit Awards | 2010 Plan | ||||||
Additional Employee Stock Plans Information | ||||||
Vesting period of awards | 2 years | |||||
Compensation expenses recognized | 451 | 380 | $ 1,121 | 886 | ||
Unrecognized compensation expense, net of expected forfeitures, calculated under the fair value method for shares expected to vest | 819 | 819 | ||||
Restricted Stock Unit Awards | ||||||
Additional Employee Stock Plans Information | ||||||
Compensation expenses recognized | 191 | $ 142 | 1,628 | $ 1,372 | ||
Unrecognized compensation expense, net of expected forfeitures, calculated under the fair value method for shares expected to vest | $ 536 | 536 | ||||
Restricted Stock Unit Awards | Non-employee director | ||||||
Additional Employee Stock Plans Information | ||||||
Number of shares issued upon exercise of units other than options | shares | 1 | |||||
Restricted Stock Unit Awards | Management | ||||||
Additional Employee Stock Plans Information | ||||||
Minimum age of employee, attaining which awards are continued to be vested upon retirement | age | 65 | |||||
Minimum service period, upon serving which awards are continued to be vested upon retirement | 10 years | |||||
Minimum age of employee along with service period condition, attaining which awards are continued to be vested upon retirement | age | 55 | |||||
Accelerated stock based compensation expense | $ 619 | $ 528 | ||||
Restricted Stock Unit Awards | Common Stock | Management | ||||||
Additional Employee Stock Plans Information | ||||||
Number of shares issued upon exercise of units other than options | shares | 1 | |||||
Restricted Stock Unit Awards | 2010 Plan | ||||||
Additional Employee Stock Plans Information | ||||||
Maximum period following a termination of service in which the share-based award will be settled | 2 months 15 days | |||||
Accounting Standards Update 2016-09 | ||||||
Additional Employee Stock Plans Information | ||||||
Income tax expense | $ 616 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Taxes | ||||
Effective tax rate (as a percent) | 38.10% | 38.50% | 33.90% | 37.20% |
Segments (Details)
Segments (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||
Sep. 30, 2017USD ($)segmentcustomer | Sep. 30, 2016USD ($) | Jul. 14, 2016segment | Sep. 30, 2017USD ($)segment | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | |
Segment Reporting Information [Line Items] | ||||||
Number of operating segments | segment | 2 | 1 | 2 | |||
Number of reportable segments | segment | 1 | 2 | ||||
Number of customers | customer | 0 | |||||
Net sales | $ 125,339 | $ 123,573 | $ 336,958 | $ 286,125 | ||
Gross profit (loss) | 36,055 | 36,644 | 98,275 | 92,296 | ||
Selling, general and administrative expense | 13,093 | 15,761 | 45,074 | 37,986 | ||
Income (loss) from operations | 19,965 | 16,488 | 44,669 | 46,463 | ||
Depreciation expense | 1,806 | 1,617 | 5,283 | 4,370 | ||
Assets | 694,070 | 700,062 | 694,070 | 700,062 | $ 666,173 | |
Capital expenditures | 2,070 | 2,290 | 5,216 | 7,084 | ||
Work Truck Attachments | ||||||
Segment Reporting Information [Line Items] | ||||||
Capital expenditures | 1,470 | 1,645 | 3,560 | 6,439 | ||
Work Truck Solutions | ||||||
Segment Reporting Information [Line Items] | ||||||
Capital expenditures | 600 | 645 | 1,656 | 645 | ||
Corporate & Eliminations | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | (4,906) | (3,982) | (6,897) | (3,842) | ||
Selling, general and administrative expense | 2,718 | 4,822 | 10,985 | 12,005 | ||
Income (loss) from operations | (4,924) | (7,212) | (12,660) | (15,737) | ||
Depreciation expense | 32 | 49 | 112 | 149 | ||
Assets | 7,238 | 12,398 | 7,238 | 12,398 | ||
Operating segment | Work Truck Attachments | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 98,002 | 100,448 | 247,088 | 262,860 | ||
Selling, general and administrative expense | 7,378 | 8,005 | 22,780 | 23,047 | ||
Income (loss) from operations | 23,105 | 24,077 | 52,186 | 62,577 | ||
Depreciation expense | 1,366 | 1,359 | 4,085 | 4,012 | ||
Assets | 471,163 | 484,261 | 471,163 | 484,261 | ||
Operating segment | Work Truck Solutions | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 32,243 | 27,107 | 96,767 | 27,107 | ||
Selling, general and administrative expense | 2,997 | 2,934 | 11,309 | 2,934 | ||
Income (loss) from operations | 1,784 | (377) | 5,143 | (377) | ||
Depreciation expense | 408 | 209 | 1,086 | 209 | ||
Assets | $ 215,669 | $ 203,403 | $ 215,669 | $ 203,403 |
Changes in Accumulated Other 49
Changes in Accumulated Other Comprehensive Loss by Component - Rollforward (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Changes to accumulated other comprehensive loss by component | ||
Balance at the beginning of the period | $ (6,672) | $ (6,183) |
Other comprehensive earning (loss) before reclassifications | (656) | (1,967) |
Amounts reclassified from accumulated other comprehensive loss | 450 | 459 |
Balance at the end of the period | (6,878) | (7,691) |
Unrealized Net Loss on Interest Rate Swap | ||
Changes to accumulated other comprehensive loss by component | ||
Balance at the beginning of the period | (1,195) | (937) |
Other comprehensive earning (loss) before reclassifications | (656) | (1,967) |
Amounts reclassified from accumulated other comprehensive loss | 164 | 181 |
Balance at the end of the period | (1,687) | (2,723) |
Other Postretirement Benefit Liability | ||
Changes to accumulated other comprehensive loss by component | ||
Balance at the beginning of the period | 937 | 1,048 |
Amounts reclassified from accumulated other comprehensive loss | (50) | (59) |
Balance at the end of the period | 887 | 989 |
Pension Liability | ||
Changes to accumulated other comprehensive loss by component | ||
Balance at the beginning of the period | (6,414) | (6,294) |
Amounts reclassified from accumulated other comprehensive loss | 336 | 337 |
Balance at the end of the period | $ (6,078) | $ (5,957) |
Changes in Accumulated Other 50
Changes in Accumulated Other Comprehensive Loss by Component - Reclassifications (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Amounts reclassified from accumulated other comprehensive loss: | ||||
Interest expense, net | $ 4,860 | $ 4,518 | $ 14,348 | $ 10,253 |
Tax expense (benefit) | 5,754 | 4,571 | 10,668 | 17,122 |
Reclassification net of tax | $ (9,210) | $ (7,201) | (20,528) | (28,518) |
Interest rate swap | Amount reclassified from accumulated other comprehensive income | ||||
Amounts reclassified from accumulated other comprehensive loss: | ||||
Interest expense, net | 292 | |||
Tax expense (benefit) | (111) | |||
Reclassification net of tax | 181 | |||
Other Postretirement Benefit Liability | Amount reclassified from accumulated other comprehensive income | ||||
Amounts reclassified from accumulated other comprehensive loss: | ||||
Actuarial (gains) losses | (81) | (95) | ||
Tax expense (benefit) | 31 | 36 | ||
Reclassification net of tax | (50) | (59) | ||
Pension Liability | Amount reclassified from accumulated other comprehensive income | ||||
Amounts reclassified from accumulated other comprehensive loss: | ||||
Actuarial (gains) losses | 543 | 543 | ||
Tax expense (benefit) | (207) | (206) | ||
Reclassification net of tax | 336 | $ 337 | ||
Unrealized Net Loss on Interest Rate Swap | Interest rate swap | ||||
Amounts reclassified from accumulated other comprehensive loss: | ||||
Interest expense, net | 264 | |||
Tax expense (benefit) | (100) | |||
Reclassification net of tax | $ 164 |
Recent Accounting Pronounceme51
Recent Accounting Pronouncements (Details) - Accounting Standards Update 2017-07 - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Net periodic benefit cost for pensions and other postretirement benefits | $ 957 | $ 917 |
Service cost | $ 420 | $ 399 |