Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Mar. 01, 2018 | Jun. 30, 2017 | |
Document and Entity Information | |||
Entity Registrant Name | DOUGLAS DYNAMICS, INC | ||
Entity Central Index Key | 1,287,213 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 738 | ||
Entity Common Stock, Shares Outstanding | 22,590,897 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 36,875 | $ 18,609 |
Accounts receivable, net | 79,120 | 78,589 |
Inventories | 71,524 | 70,871 |
Inventories - truck chassis floor plan | 7,711 | 3,939 |
Refundable income taxes paid | 1,541 | |
Prepaid and other current assets | 2,883 | 2,886 |
Total current assets | 198,113 | 176,435 |
Property, plant, and equipment, net | 53,962 | 52,141 |
Goodwill | 241,006 | 238,286 |
Other intangible assets, net | 186,150 | 194,851 |
Other long-term assets | 5,945 | 4,460 |
Total assets | 685,176 | 666,173 |
Current liabilities: | ||
Accounts payable | 16,323 | 17,299 |
Accrued expenses and other current liabilities | 21,004 | 27,325 |
Floor plan obligations | 7,711 | 3,939 |
Income taxes payable | 2,996 | |
Current portion of long-term debt | 32,749 | 2,829 |
Total current liabilities | 80,783 | 51,392 |
Retiree health benefit obligation | 6,809 | 7,193 |
Pension obligation | 9,761 | 10,184 |
Deferred income taxes | 39,269 | 54,563 |
Long-term debt, less current portion | 274,872 | 306,726 |
Other long-term liabilities | 17,004 | 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 December 31, 2017 and December 31, 2016, respectively | 226 | 225 |
Additional paid-in capital | 147,287 | 144,523 |
Retained earnings | 115,737 | 82,387 |
Accumulated other comprehensive loss, net of tax | (6,572) | (6,672) |
Total stockholders' equity | 256,678 | 220,463 |
Total liabilities and stockholders' equity | $ 685,176 | $ 666,173 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 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 ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME | |||
Net sales | $ 474,927 | $ 416,268 | $ 400,408 |
Cost of sales | 331,841 | 282,294 | 267,545 |
Gross profit | 143,086 | 133,974 | 132,863 |
Selling, general, and administrative expense | 61,594 | 54,260 | 48,150 |
Intangibles amortization | 11,401 | 10,596 | 7,362 |
Income (loss) from operations | 70,091 | 69,118 | 77,351 |
Interest expense, net | (18,336) | (15,195) | (10,895) |
Litigation proceeds | 1,275 | 10,050 | |
Other expense, net | (115) | (277) | (193) |
Income before taxes | 52,915 | 63,696 | 66,263 |
Income tax expense | (2,409) | 24,687 | 22,087 |
Net income | $ 55,324 | $ 39,009 | $ 44,176 |
Weighted average number of common shares outstanding: | |||
Basic (in shares) | 22,576,381 | 22,480,679 | 22,329,044 |
Diluted (in shares) | 22,587,648 | 22,480,679 | 22,341,775 |
Earnings per common share: | |||
Basic (in dollars per share) | $ 2.42 | $ 1.71 | $ 1.95 |
Diluted (in dollars per share) | 2.40 | 1.70 | 1.94 |
Cash dividends declared per share (in dollars per share) | 0.96 | 0.94 | 0.89 |
Cash dividends paid per share (in dollars per share) | $ 0.96 | $ 0.94 | $ 0.89 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Net income | $ 55,324 | $ 39,009 | $ 44,176 |
Adjustment for pension and postretirement benefit liability, net of tax of ($140) in 2017, $147 in 2016 and ($495) in 2015 | 233 | (231) | 782 |
Adjustment for interest rate swap, net of tax of $88 in 2017, $225 in 2016 and $564 in 2015 | (133) | (258) | (937) |
Comprehensive Income | $ 55,424 | $ 38,520 | $ 44,021 |
CONSOLIDATED STATEMENTS OF COM6
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Adjustment for pension and postretirement benefit liability, tax | $ (140) | $ 147 | $ (495) |
Adjustment for interest rate swap, tax | $ 88 | $ 225 | $ 564 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total |
Balance at Dec. 31, 2014 | $ 223 | $ 138,268 | $ 40,826 | $ (6,028) | $ 173,289 |
Balance (in shares) at Dec. 31, 2014 | 22,282,628 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 44,176 | 44,176 | |||
Dividends paid | (20,173) | (20,173) | |||
Adjustment for pension and postretirement benefit liability, net of tax of ($140) in 2017, $147 in 2016 and ($495) in 2015 | 782 | 782 | |||
Adjustment for interest rate swap, net of tax of $88 in 2017, $225 in 2016 and $564 in 2015 | (937) | (937) | |||
Shares withheld on restricted stock vesting | (27) | (27) | |||
Shares issued from exercise of stock options | 111 | 111 | |||
Shares issued from exercise of stock options (in shares) | 26,350 | ||||
Stock based compensation | $ 1 | 3,274 | 3,275 | ||
Stock based compensation (in shares) | 78,819 | ||||
Balance at Dec. 31, 2015 | $ 224 | 141,626 | 64,829 | (6,183) | 200,496 |
Balance (in shares) at Dec. 31, 2015 | 22,387,797 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 39,009 | 39,009 | |||
Dividends paid | (21,451) | (21,451) | |||
Adjustment for pension and postretirement benefit liability, net of tax of ($140) in 2017, $147 in 2016 and ($495) in 2015 | (231) | (231) | |||
Adjustment for interest rate swap, net of tax of $88 in 2017, $225 in 2016 and $564 in 2015 | (258) | (258) | |||
Stock based compensation | $ 1 | 2,897 | 2,898 | ||
Stock based compensation (in shares) | 113,843 | ||||
Balance at Dec. 31, 2016 | $ 225 | 144,523 | 82,387 | (6,672) | 220,463 |
Balance (in shares) at Dec. 31, 2016 | 22,501,640 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 55,324 | 55,324 | |||
Dividends paid | (21,974) | (21,974) | |||
Prior period adjustment | 187 | 187 | |||
Adjustment for pension and postretirement benefit liability, net of tax of ($140) in 2017, $147 in 2016 and ($495) in 2015 | 233 | 233 | |||
Adjustment for interest rate swap, net of tax of $88 in 2017, $225 in 2016 and $564 in 2015 | (133) | (133) | |||
Shares withheld on restricted stock vesting | (923) | (923) | |||
Stock based compensation | $ 1 | 3,500 | 3,501 | ||
Stock based compensation (in shares) | 89,257 | ||||
Balance at Dec. 31, 2017 | $ 226 | $ 147,287 | $ 115,737 | $ (6,572) | $ 256,678 |
Balance (in shares) at Dec. 31, 2017 | 22,590,897 |
CONSOLIDATED STATEMENTS OF CHA8
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY | |||
Adjustment for pension and postretirement benefit liability, tax | $ (140) | $ 147 | $ (495) |
Adjustment for interest rate swap, tax | $ 88 | $ 225 | $ 564 |
CONDENSED CONSOLIDATED STATEME9
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Operating activities | |||
Net income | $ 55,324 | $ 39,009 | $ 44,176 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | |||
Depreciation and amortization | 18,584 | 16,742 | 12,281 |
Inventory step up of acquired business included in cost of sales | 125 | 1,956 | |
Amortization of deferred financing costs and debt discount | 1,214 | 950 | 720 |
Stock-based compensation | 3,500 | 2,898 | 3,275 |
Provision (benefit) for losses on accounts receivable | 1,475 | 208 | 305 |
Deferred income taxes | (15,242) | 5,413 | 5,807 |
Earnout liability | (1,786) | (1,128) | 623 |
Changes in operating assets and liabilities, net of acquisitions: | |||
Accounts receivable | (1,154) | 2,419 | (7,094) |
Inventories | 894 | 605 | (5,292) |
Prepaid assets, refundable income taxes and other assets | 65 | 1,699 | (5,886) |
Accounts payable | (2,487) | (113) | 4,802 |
Accrued expenses and other current liabilities | 5,481 | (3,434) | 3,138 |
Benefit obligations and other long-term liabilities | 486 | 4,527 | (2,346) |
Net cash provided by (used in) operating activities | 66,354 | 69,920 | 56,465 |
Investing activities | |||
Capital expenditures | (7,563) | (9,830) | (10,009) |
Acquisition of business | (7,385) | (181,344) | (11,818) |
Net cash used in investing activities | (14,948) | (191,174) | (21,827) |
Financing activities | |||
Shares withheld on restricted stock vesting paid for employees' taxes | (923) | (27) | |
Proceeds from exercise of stock options | 111 | ||
Payments of financing costs | (1,608) | (2,320) | |
Earnout payment | (5,487) | ||
Borrowings on long-term debt | 129,350 | ||
Dividends paid | (21,974) | (21,451) | (20,173) |
Repayment of long-term debt | (3,148) | (2,560) | (1,900) |
Net cash provided by (used in) financing activities | (33,140) | 103,019 | (21,989) |
Change in cash and cash equivalents | 18,266 | (18,235) | 12,649 |
Cash and cash equivalents at beginning of year | 18,609 | 36,844 | 24,195 |
Cash and cash equivalents at end of year | 36,875 | 18,609 | 36,844 |
Non-cash operating and financing activities | |||
Truck chassis inventory acquired through floorplan obligations | 45,472 | 13,697 | |
Supplemental disclosure of cash flow information | |||
Income taxes paid | 6,607 | 16,440 | 21,633 |
Interest paid | $ 17,224 | $ 14,235 | $ 10,519 |
Basis of presentation
Basis of presentation | 12 Months Ended |
Dec. 31, 2017 | |
Basis of presentation | |
Basis of presentation | 1. Description of business and basis of Douglas Dynamics, Inc. (the “Company,”) is a premier manufacturer and upfitter of commercial v ehicle attachments and equipment. The Company’s portfolio includes snow and ice management attachments sold under the BLIZZARD ® , FISHER ® , HENDERSON ® , SNOWEX ® and WESTERN ® brands, turf care equipment under the TURFEX ® brand, and industrial maintenance equipment under the SWEEPEX ® brand. 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 (such assets “Dejana”) . The Company is headquartered in Milwaukee, WI and currently owns manufacturing and upfit facilities in Milwaukee, WI, Manchester Iowa, Rockland, ME, Madison Heights, MI and Huntley, IL. The Company also leases fifteen manufacturing and upfit facilities located in Iowa, Maryland, Missouri, New Jersey, New York, Ohio, Pennsylvania, and Rhode Island. Additionally, the Company operates a sourcing office in China. The Company conducts business in two segments: Work Truck Attachments and Work Truck Solutions. The Work Truck Solutions segment was established as a result of the acquisition of Dejana. The Company’s Work Truck Attachments segment consists of operations that, prior to the acquisition of Dejana, were the Company’s single operating segment, consisting of the manufacture and sale of snow and ice control products. Financial information regarding these segments is in Note 15 to the Consolidated Financial Statements. Recently adopted accounting standards 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 which were previously included in Current assets to Deferred income taxes which are included in Liabilities and shareholders’ equity on the balance sheet of $5,726 for December 31, 2016. 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: · 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. · 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. · 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 year ended December 31, 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. 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. 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 consolidated financial statements for the year ended December 31, 2017. See Note 20 for a summary of recent accounting pronouncements and the Company’s evaluation of their impact on the financial statements. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Principles of consolidation The accompanying consolidated financial statements include the accounts of Douglas Dynamics, Inc. and its direct wholly‑owned subsidiary, Douglas Dynamics, L.L.C., and its wholly‑owned subsidiaries, Douglas Dynamics Finance Company (an inactive subsidiary), Fisher, LLC, Henderson Enterprises Group, Inc., Henderson Products, Inc. and Dejana Truck & Utility Equipment Company, LLC (hereinafter collectively referred to as the “Company”). All intercompany balances and transactions have been eliminated in consolidation. Use of estimates The preparation of the financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Accordingly, actual results could differ from those estimates. Cash and cash equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents are carried at cost, which approximates fair value. Accounts receivable and allowance for doubtful accounts The Company carries its accounts receivable at their face amount less an allowance for doubtful accounts. The majority of the Company’s accounts receivable are due from distributors of truck equipment and dealers of completed upfit trucks. Credit is extended based on an evaluation of a customer’s financial condition. On a periodic basis, the Company evaluates its accounts receivable and establishes the allowance for doubtful accounts based on a combination of specific customer circumstances and credit conditions based on a history of write‑offs and collections. A receivable is considered past due if payments have not been received within agreed upon invoice terms. Accounts receivable are written off after all collection efforts have been exhausted. The Company takes a security interest in the inventory as collateral for the receivable but often does not have a priority security interest. Financing program The Company is party to a financing program in which certain distributors may elect to finance their purchases from the Company through a third party financing company. The Company provides the third party financing company recourse against the Company regarding the collectability of the receivable under the program due to the fact that if the third party financing company is unable to collect from the distributor the amounts due in respect of the product financed, the Company would be obligated to repurchase any remaining inventory related to the product financed and reimburse any legal fees incurred by the financing company. During the years ended December 31, 2017, 2016 and 2015, distributors financed purchases of $7,115, $7,578 and $7,584 through this financing program, respectively. At both December 31, 2017 and December 31, 2016, there were no uncollectible outstanding receivables related to sales financed under the financing program. The amount owed by distributors to the third party financing company under this program at December 31, 2017 and 2016 was $3,436 and $6,767, respectively. The Company was required to repurchase repossessed inventory of $0, $0, and $13 for the years ended December 31, 2017, 2016 and 2015, respectively. In the past, minimal losses have been incurred under this agreement. However, an adverse change in distributor retail sales could cause this situation to change and thereby require the Company to repurchase repossessed units. Any repossessed units are inspected to ensure they are current, unused product and are restocked and resold. Interest Rate Swap The Company is a counterparty to interest-rate swap agreements to hedge against the potential impact on earnings from increases in market interest rates. The Company entered into three interest rate swap agreements during the first quarter of 2015 with 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. All three interest rate swap agreements are accounted for as cash flow hedges. 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 3.00% (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 3.00% (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 3.00% (with a LIBOR floor of 1.0%). The negative fair value of the interest rate swap, net of tax, of ($1,328) and ($1,195) at December 31, 2017 and December 31, 2016, respectively, is included in Accumulated other comprehensive loss on the balance sheet. This fair value was determined using Level 2 inputs as defined in Accounting Standards Codification Topic (“ASC”) 820 - Fair Value Measurements and Disclosures. Inventories Inventories are stated at the lower of cost or market. Market is determined based on estimated realizable values. Inventory costs are primarily determined by the first‑in, first‑out (FIFO) method. The Company periodically reviews its inventory for slow moving, damaged and discontinued items and provides reserves to reduce such items identified to their recoverable amounts. The Company records inventories to include truck chassis inventory financed through a floor plan financing agreement as discussed in Note 7. The Company takes title to truck chassis upon receipt of the inventory through their floor plan agreement and performs upfitting 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 December 31, 2017 and 2016, the Company had $7,711 and $3,939 of chassis inventory and related floor plan financing obligation, respectively. The Company recognizes revenue associated with upfitting and service installations net of the truck chassis. The Company receives, on consignment, truck chassis on which it performs upfitting 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 December 31, 2017 and 2016 was $17,447 and $22,420, respectively. The Company is responsible to the manufacturer for interest on chassis held for upfitting. The Company recognizes revenue associated with upfitting and service installations net of the truck chassis. Leases As of December 31, 2017, fifteen of the Company’s upfit and distribution centers were subject to a lease agreement. All of the Company’s current leases are considered operating leases, and are not recorded on the Company’s balance sheet. Rent expense is recognized on a straight-line basis over the expected lease term. The Company leases buildings in which it operates from both related party and third party lessors. See Note 14 for further details. Property, plant and equipment Property, plant and equipment are recorded at cost, less accumulated depreciation. Depreciation is computed using straight‑line methods over the estimated useful lives for financial statement purposes and an accelerated method for income tax reporting purposes. The estimated useful lives of the assets are as follows: Years Land improvements and buildings - 40 Leasehold improvements Machinery and equipment - 20 Furniture and fixtures - 12 Mobile equipment and other - 10 Depreciation expense was $7,183, $6,146, and $4,919 for the years ended December 31, 2017, 2016 and 2015, respectively. Expenditures for renewals and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized. Expenditures for maintenance and repairs are charged to operations when incurred. Repairs and maintenance expenses amounted to $5,222, $5,060 and $5,272 for the years ended December 31, 2017, 2016 and 2015, respectively. When assets are sold or retired, the cost of the asset and the related accumulated depreciation are eliminated from the accounts and any gain or loss is recognized in results of operations. Impairment of long‑lived assets Long‑lived assets are reviewed for potential impairment when events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of assets to be held and used is measured by comparison of the carrying value of such assets to the undiscounted future cash flows expected to be generated by the assets. If the carrying value of an asset exceeds its estimated undiscounted future cash flows, an impairment provision is recognized to the extent that the carrying amount of the asset exceeds its fair value. Assets to be disposed of are reported at the lower of the carrying amount or the fair value of the asset, less costs of disposition. Management of the Company considers such factors as current results, trends and future prospects, current market value, and other economic and regulatory factors in performing these analyses. The Company determined that no long‑lived assets were impaired as of December 31, 2017 and 2016. Goodwill and other intangible assets Goodwill and indefinite‑lived intangible assets are tested for impairment annually as of December 31, or sooner if impairment indicators arise. The fair value of indefinite‑lived intangible assets is estimated based upon an income and market approach. In reviewing goodwill for impairment, potential impairment is identified by comparing the estimated fair value of the reporting units to its carrying value. The Company has determined it has three reporting units. When the fair value is less than the carrying value of the net assets of the reporting unit, including goodwill, an impairment loss may be recognized. The Company has determined that goodwill and indefinite lived assets were not impaired as of December 31, 2017 and 2016. The Company had goodwill of $241,006 and $238,286 at December 31, 2017 and 2016, respectively, of which $160,932 relates to goodwill associated with the Work Truck Attachments segment at both December 31, 2017 and 2016 and $80,074 and $77,354 relates to the Work Truck Solutions segment at December 31, 2017 and 2016, respectively. Intangible assets with estimable useful lives are amortized over their respective estimated useful lives and are reviewed for potential impairment when events or circumstances indicate that the carrying amount of the asset may not be recoverable. The Company amortizes its distribution network intangible over periods ranging from 15 to 20 years, trademarks over 7 to 25 years, patents over 7 to 20 years, customer relationships over 15 to 19.5 years and noncompete agreements over 4 to 5 years. The Company acquired backlogs in conjunction with the Dejana and Henderson acquisitions on July 15, 2016 and December 31, 2014, respectively. The Dejana backlog was amortized in the same quarter as the acquisition. Meanwhile, the Henderson backlog was amortized in the first half of 2015. There were no indicators of impairment during the years ended December 31, 2017 and 2016. The Company had gross intangible assets and accumulated amortization of $275,675 and $89,525, respectively, for the year ended December 31, 2017, of which $195,175 and $81,336 relate to the Work Truck Attachments segment, and $80,500 and $8,189 relate to the Work Truck Solutions segment, respectively. The Company had gross intangible assets and accumulated amortization of $272,975 and $78,124, respectively for the year ended December 31, 2016, of which $195,175 and $74,432 relate to the Work Truck Attachments segment, and $77,800 and $3,692 relate to the Work Truck Solutions segment, respectively. Income taxes Deferred income taxes are accounted for under the asset and liability method whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates. Deferred income tax provisions or benefits are based on the change in the deferred tax assets and liabilities from period to period. Deferred income tax assets are reduced by a valuation allowance if it is more likely than not that some portion of the deferred income tax asset will not be realized. Additionally, when applicable, the Company would classify interest and penalties related to uncertain tax positions in income tax expense. Deferred financing costs The costs of obtaining financing are capitalized and amortized over the term of the related financing on a basis that approximates the effective interest method. The changes in deferred financing costs are as follows: Balance at December 31, 2014 $ 2,485 Amortization of deferred financing costs (148) Balance at December 31, 2015 Deferred financing costs capitalized on new debt Amortization of deferred financing costs (624) Balance at December 31, 2016 Amortization of deferred financing costs Balance at December 31, 2017 $ 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 December 31, 2017 Fair Value at December 31, 2016 Assets: Other long-term assets (a) $ 4,840 $ 3,458 Total Assets $ 4,840 $ 3,458 Liabilities: Interest rate swaps (b) 2,178 1,985 Long term debt (c) 312,384 315,940 Earnout - Henderson (d) 529 636 Earnout - Dejana (e) 3,100 10,373 Total Liabilities $ 318,191 $ 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 amounts of these insurance policies approximates their fair value. (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 $597 and $1,581 at December 31, 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 financing 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 $87 and $442, respectively, at December 31, 2017 is the fair value of an obligation for a portion of the potential earn out acquired in conjunction with the acquisition of Henderson. Included in accrued expenses and other current liabilities and other long term liabilities in the amounts of $194 and $442, respectively, at December 31, 2016 is the fair value of an obligation for a portion of the potential earn out 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: December 31, 2017 2016 Beginning Balance $ 636 $ 761 Payment to former owners (107) (125) Ending balance $ 529 $ 636 (e) Included in Other long term liabilities in the amount of $3,100 at December 31, 2017 is the fair value of an obligation for a portion of the potential earn out 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 $5,487 and $4,886, respectively, at December 31, 2016 is the fair value of an obligation for a portion of the potential earn out incurred in conjunction with the acquisition of Dejana. The carrying amount of the earn out approximates its fair value. 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: December 31, 2017 2016 Beginning Balance $ 10,373 $ - Additions - 10,200 Adjustments to fair value (1,786) 173 Payment to former owners (5,487) - Ending balance $ 3,100 $ 10,373 Concentration of credit risk The Company’s cash is deposited with multiple financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. The Company has not experienced any losses in such accounts and believes that it is not exposed to any significant risk on these balances. No distributor represented more than 10% of the Company’s net sales or accounts receivable during the years ended December 31, 2017, 2016 and 2015. Revenue recognition Work Truck Attachments Segment Revenue Recognition The Company recognizes revenues upon shipment of equipment to the customer, which is when risk of loss passes and all of the following conditions are satisfied: (i) persuasive evidence of an arrangement exists; (ii) the price is fixed or determinable; (iii) collectability is reasonably assured; and (iv) the product has been shipped and the Company has no further obligations. Customers have no right of return privileges. Historically, product returns have not been material and are permitted on an exception basis only. Revenues from the sales of the Work Truck Attachments segment equipment are generally recognized on a gross basis. Additionally, within the Work Truck Attachments segment, the Company performs upfitting services. Upfitting services are recognized as revenue when risk of loss passes and all of the following conditions are satisfied: (i) persuasive evidence of an arrangement exists; (ii) the price is fixed or determinable; (iii) collectability is reasonably assured; and (iv) the product has been either delivered or picked up by the customer and the Company has no further obligations. Customers have no right of return privileges. Historically, product returns have not been material and are permitted on an exception basis only. Additionally, customers are billed separately for the truck chassis by the chassis manufacturer. The Company only records sales for the net amount of the upfit, excluding the truck chassis. The company acts as a garage keeper and never takes ownership or title to the truck chassis and does not pay interest associated with the truck chassis on its premises within the Work Truck Attachments segment. Within the Work Truck Attachments segment, the Company offers a variety of discounts and sales incentives to its distributors. The estimated liability for sales discounts and allowances is recorded at the time of sale as a reduction of net sales. The liability is estimated based on the costs of the program, the planned duration of the program and historical experience. Work Truck Solutions Segment Revenue Recognition Within the Work Truck Solutions segment, the Company performs upfitting services. Upfitting services are recognized as revenue when risk of loss passes and all of the following conditions are satisfied: (i) persuasive evidence of an arrangement exists; (ii) the price is fixed or determinable; (iii) collectability is reasonably assured; and (iv) the product has been either delivered or picked up by the customer and the Company has no further obligations. Customers have no right of return privileges. Historically, product returns have not been material and are permitted on an exception basis only. Additionally, customers are billed separately for the truck chassis by the chassis manufacturer. The Company only records sales for the net amount of the upfit, excluding the truck chassis. The Company obtains the truck chassis from the truck chassis manufacturer through either its floor plan agreement with a financial institution or bailment pool agreement with the truck chassis manufacturer. For truck chassis acquired through the floor plan agreement, the Company holds title to the vehicle from the time the chassis is received by the Company until the completion of the upfit. Conversely, under the bailment pool agreement, the Company does not take title to the truck chassis, but rather only holds the truck chassis on consignment. The Company pays interest on both of these arrangements as discussed below in Note 7. The Company records revenue in the same manner net of the value of the truck chassis in both the Company’s floor plan and bailment pool agreements. Revenues from the sales of the Work Truck Solutions products are generally recognized net of the truck chassis with the selling price to the customer recorded as sales and the manufacturing and upfit cost of the product recorded as cost of sales. The Company also sells certain products within the Work Truck Solutions segment for which it acts as an agent. Products in this category include the sale of third-party products. These sales do not meet the criteria for gross sales recognition, and thus are recognized on a net basis at the time of sale. Under net sales recognition, the cost paid to the third-party service provider is recorded as a reduction to sales, resulting in net sales being equal to the gross profit on the transaction. Cost of sales Cost of sales includes all costs associated with the manufacture of the Company’s products, including raw materials, purchased parts, freight, plant operating expenses, property insurance and taxes, and plant depreciation. All payroll costs and employee benefits for the hourly workforce, manufacturing management, and engineering costs are included in cost of sales. Related party transactions As a result of the Dejana acquisition, the Company entered into related party leases. See Note 14 for further details. During 2016, one of the Company’s non-employee directors, served as the Chief Executive Officer of Fleetpride, Inc., an independent distributor of parts for heavy duty trucks and trailers. During 2016, the Company purchased parts from Fleetpride, Inc. for use in Henderson Products, Inc. trucks. The total amount of these purchases during 2016 was $242. There were no related party purchases during 2017. Warranty cost recognition The Company accrues for estimated warranty costs as revenue is recognized. See Note 9 for further details. Defined benefit plans The Company has noncontributory, defined benefit retirement plans and postretirement benefit plans covering certain employees. Management reviews underlying assumptions on an annual basis. Refer to Note 11. Advertising expenses Advertising expenses include costs for the production of marketing media, literature, CD‑ROM, and displays. The Company participates in trade shows and advertises in the yellow pages and billboards. Advertising expenses amounted to $4,471, $4,269 and $4,511 for the years ended December 31, 2017, 2016 and 2015, respectively. The Company also provides its distributors with pre‑approved, cooperative advertising programs, which are recorded as advertising expense in selling, general and administrative expense. All costs associated with the Company’s advertising programs are expensed as incurred. Research and development expenses Research and development expenses include costs to develop new technologies to enhance existing products and to expand the range of product offerings. Research and development expenses amounted to $2,926, $3,132 and $2,950 for the years ended December 31, 2017, 2016 and 2015, respectively. Shipping and handling costs Generally, shipping and handling costs are paid directly by the customer to the shipping agent. Those shipping and handling costs billed by the Company are recorded as a component of sales with the corresponding costs included in cost of sales. Share‑based payments The Company applies the guidance codified in ASC 718, Compensation—Stock Compensation. This standard requires the measurement of the cost of employee services received in exchange for an award of equity instruments based on the fair value of the award at the grant date and recognition of the compensation expense over the period during which an employee is required to provide service in exchange for the award (generally the vesting period). Comprehensive loss Comprehensive loss is defined as the change in equity (net assets) of a business enterprise during a period from transactions and other events and circumstances from non‑owner resources and is comprised of net income or loss and “other comprehensive loss”. The Company’s other comprehensive loss is comprised of the adjustments for pension and postretirement benefit liabilities as well as the impact of its interest rate swaps. See Note 18 for the components of accumulated other comprehensive loss. Segment Reporting As a result of the Dejana acquisition which closed on July 15, 2016, 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, 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 the Company’s operations that, prior to the Company’s acquisition of Dejana, were a 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 upfit 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, gross margin and operating income. Items not allocated to segment operating income include corporate administrative expenses and certain other amounts that include various support functions, such as information technology, corporate finance, legal, executive administration and human resources. No single customer’s revenues amounted to 10% or more of the Company’s total revenue . Sales are primarily within the United States and substantially all assets are located within the United States. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2017 | |
Acquisitions | |
Acquisition | 3. Acquisitions On May 1, 2017, the Company purchased substantially all of the assets of Arrowhead Equipment, Inc. (“Arrowhead”). Total consideration was $7,385. The acquisition includes the Arrowhead’s assets acquired at two upfit 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 $343 of transaction expenses related to this acquisition that are included in selling, general and administrative expense in the Consolidated Statements of Income in the year ended December 31, 2017. The following table summarizes the 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 liabilities (957) Unfavorable lease (107) Total $ 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 acquisition method of accounting, 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 December 31, 2017, the Arrowhead assets contributed $7,964 of revenues and $607 of pre-tax operating income to the Company. On July 15, 2016, the Company acquired Dejana. Total consideration was $191,544 including a preliminary 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 $3,422 of transaction expenses related to the Dejana acquisition that are included in selling, general and administrative expense in the Consolidated Statements of Income in the year ended December 31, 2016. The Dejana purchase agreement includes contingent consideration in the form of an earn out capped at $26,000. Under the earn out 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. The preliminary estimated fair value of the earn out 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. The subsequent adjustment is included in selling, general and administrative expense in the Consolidated Statements of Income in the year ended December 31, 2016. Based on the year ended December 31, 2016 results, the new possible range of outcomes was reduced from $26,000 to a maximum earnout of $21,487. T he Company made a payment to the former owners of Dejana of $5,487 in the year ended December 31, 2017. The purchase 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 unearned earnout payments based on the original earnout targets and measurement periods. During the third quarter of 2017, there was a fair value adjustment to reduce the earn out by ($1,186), which was further reduced based on the most recent valuation during the fourth quarter by ($600), for a total fair value adjustment to the earnout for the year of ($1,786), which is included in selling, general and administrative expense in the Consolidated Statements of Income for the year ended December 31, 2017. The following table summarizes the 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 liabilities (3,881) Floor plan obligations (13,479) Earn out liability (10,200) Total $ 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 acquisition method of accounting, 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 December 31, 2016, the Dejana assets contributed $65,044 of revenues and ($1,397) of pre-tax operating losses. The following unaudited pro forma information presents the combined results of operations of the Company and Dejana for the years ended December 31, 2016 and December 31, 2015 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: Years ended December 31, 2016 2015 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. On December 31, 2014, the Company acquired all of the outstanding common stock of Henderson for the purpose of expanding its current market presence in the snow and ice segment. Total consideration was $98,511 including a working capital adjustment of $4,688 and a separate payment to one of the former shareholders of $3,340. The Company paid the former shareholders of Henderson $4,688 of the working capital adjustment in the year ended December 31, 2015 and had an outstanding payable to a former Henderson shareholder at December 31, 2014. The outstanding payable to the former Henderson shareholder was $3,340 at December 31, 2014 and was included in accrued expenses and other current liabilities until it was paid to the former shareholder in the year ended December 31, 2015 . |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2017 | |
Inventories | |
Inventories | 4. Inventories Inventories consist of the following: December 31, 2017 2016 Finished goods $ $ Work-in-process Raw material and supplies $ $ The inventories in the table above do not include truck chassis inventory financed through a floor plan financing agreement as discussed in Note 7. The Company takes title to truck chassis upon receipt of the inventory through their floor plan agreement and performs upfitting 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 December 31, 2017 and 2016, the Company had $7,711 and $3,939 of chassis inventory and related floor plan financing obligation, respectively. The Company recognizes revenue associated with upfitting and service installations net of the truck chassis. Unlike the floorplan agreement, the Company does not record inventory related to truck chassis acquired through the bailment pool agreement as these truck chassis are held on consignment. Like the revenue recognized on floorplan arrangement, revenue recognized for upfitting services on chassis acquired through the bailment agreement, are also recognized net of the truck chassis. |
Property, plant and equipment
Property, plant and equipment | 12 Months Ended |
Dec. 31, 2017 | |
Property, plant and equipment | |
Property, plant and equipment | 5. Property, plant and equipment Property, plant and equipment are summarized as follows: December 31, 2017 2016 Land $ $ Land improvements Leasehold improvements Buildings Machinery and equipment Furniture and fixtures Mobile equipment and other Construction-in-process Total property, plant and equipment Less accumulated depreciation Net property, plant and equipment $ $ |
Other Intangible Assets
Other Intangible Assets | 12 Months Ended |
Dec. 31, 2017 | |
Other Intangible Assets | |
Other Intangible Assets | 6. Other Intangible Assets The following is a summary of the Company’s other intangible assets: Gross Less Net Carrying Accumulated Carrying Amount Amortization Amount December 31, 2017 Indefinite-lived intangibles: Trademark and tradenames $ $ - $ Amortizable intangibles: Dealer network Customer relationships Patents Noncompete agreements Trademarks Backlog 1,900 - License - Amortizable intangibles, net Total $ $ $ Gross Less Net Carrying Accumulated Carrying Amount Amortization Amount December 31, 2016 Indefinite-lived intangibles: Trademark and tradenames $ $ - $ Amortizable intangibles: Dealer network Customer relationships Patents Noncompete agreements Trademarks Backlog 1,900 - License - Amortizable intangibles, net Total $ $ $ Amortization expense for intangible assets was $11,401, $10,596 and $7,362 for the years ended December 31, 2017, 2016 and 2015, respectively. Estimated amortization expense for the next five years is as follows: 2018 $ 2019 2020 2021 2022 The weighted average remaining life for intangible assets is 11.3 years at December 31, 2017. 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 year ended December 31, 2017, the Company received a settlement resulting from an ongoing lawsuit with one of its competitors that had been ordered 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 year ended December 31, 2016, the Company received a settlement resulting from an ongoing lawsuit with another 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 Consolidated Statements of Operations and Comprehensive Income as Litigation proceeds. |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2017 | |
Long-Term Debt | |
Long-Term Debt | 7. Long‑Term Debt Long‑term debt is summarized below: December 31, 2017 2016 Term Loan, net of debt discount of $1,562 and $1,953 at December 31, 2017 and December 31, 2016, respectively $ $ Less current maturities Long term debt before deferred financing costs Deferred financing costs, net 4,033 Long term debt, net $ $ The scheduled maturities on long term debt at December 31, 2017, are as follows: 2018 $ 32,749 2019 2,749 2020 2,749 2021 272,583 $ On July 15, 2016, the Company amended its senior credit facilities to, among other things, (i) provide for an incremental senior secured term loan facility in the aggregate principal amount of $130,000 to finance the acquisition of Dejana; (ii) permit the Company to enter into floor plan financing arrangements in an aggregate amount not to exceed $20,000; (iii) revise the calculation of excess cash flow in determining the amount of mandatory prepayments under the agreement for the term loan facility (the “Term Loan Credit Agreement”) to reduce the amount of excess cash flow by the cash portion of the purchase price of a permitted acquisition paid during any fiscal year, net of any proceeds of any related financings with respect to such purchase price and any sales of capital assets used to finance such purchase price; and (iv) extend the final maturity date of the revolving credit facility from December 31, 2019 to June 30, 2021. On February 8, 2017, the Company amended its Term Loan Credit Agreement to, among other things, (i) convert the existing senior secured term loan facilities into a consolidated senior secured term loan facility in the aggregate principal amount of $315,540; and (ii) 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). On August 17, 2017, the Company amended its Term Loan Credit Agreement to, among other things, (i) replace the existing senior secured term loan facility with a new senior secured term loan facility in the aggregate principal amount of $313,962; and (ii) 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). Prior to the 2017 amendments, the Company’s senior credit facilities consisted of a $190,000 term loan facility and a $100,000 revolving credit facility with a group of banks, of which $10,000 was available in the form of letters of credit and $5,000 was available for the issuance of short-term swingline loans . After the amendments, the Company’s senior credit facility consists of a $313,962 term loan facility and the original $100,000 revolving credit facility, of which $10,000 will be available in the form of letters of credit and $5,000 will be available for the issuance of short-term swingline loans. The Term Loan Credit Agreement provides for a senior secured term loan facility in the aggregate principal amount of $313,962 and generally bears interest (at the Company’s election) at 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) 1.00% 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%. 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 actual interest rate on the Term Loan Credit Agreement for the years ended December 31, 2017 and December 31, 2016 was 4.70% and 5.25%, respectively. The agreement for the revolving credit facility (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, and the Company’s term loan amortizes in nominal amounts quarterly with the balance payable on December 31, 2021. The term loan was originally issued at a $1,900 discount and the incremental term loan was issued at a $650 discount both of which are being amortized over the term of the term loan. The Company incurred $2,320 in financing costs in conjunction with the 2016 amendment, of which $2,120 relates to the term loan and $200 related to the revolving line of credit, which are included as deferred financing costs as a reduction to Long–Term Debt on the Consolidated Balance Sheet. The amendment to the term loan facility in the year ended December 31, 2016 was deemed not to be a significant modification. The amendments to the term loan facility in 2017 did not result in a significant debt modification under ASC 470-50. Additionally, the Company expensed as incurred approximately $1,608 in costs with third parties directly related to the amendment in the year ended December 31, 2017. At December 31, 2017, the Company had outstanding borrowings under the term loan of $310,830 and no outstanding borrowings on the revolving credit facility and remaining borrowing availability of $99,463. 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 the Company. The terms of the Company’s revolving credit facility specifically restrict subsidiaries from paying dividends if a minimum availability under the revolving credit facility 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 Company’s revolving credit facility 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 facility 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 Company’s revolving credit facility. At December 31, 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 the fiscal year, 50% of excess cash flow, as defined, including a deduction for certain distributions (which percentage is reduced to 0% upon the achievement of certain leverage ratio thresholds), for any fiscal year. Excess cash flow is defined in the senior credit facilities as consolidated adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) plus a 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 dividends or distributions). 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 current portion of long term debt. As of December 31, 2017, the Company was required to make an excess cash flow payment of $11,279, which was paid on January 31, 2018 along with a voluntary payment of $18,721. 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 December 31, 2017 was $2,178, of which $597 and $1,581 are included in Accrued expenses and other current liabilities and Other long-term liabilities on the Consolidated Balance Sheet, respectively. 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 Consolidated Balance Sheet, respectively. The Company has 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 3.00% (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 3.00% (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 3.00% (with a LIBOR floor of 1.0%). The Company receives on consignment, truck chassis on which it performs upfitting 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 December 31, 2017 and 2016 was $17,447 and $22,420, respectively. The Company is responsible to the manufacturer for interest on chassis held for upfitting. Interest rates vary depending on the number of days in the bailment pool. As of December 31, 2017, rates were based on prime (4.50% at December 31, 2017) plus a margin ranging from 0% to 8%. During 2017, the Company incurred $201 in interest on the bailment pool arrangement. During 2016, from the date of the Dejana acquisition of July 15, 2016 through December 31, 2016, the Company incurred $79 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 current 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 renewed through December 31, 2018. Under the floor plan agreement the Company receives truck chassis and title on upfitting service installations. Upon upfit 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 as of December 31, 2017 and 2016 is $7,711 and $3,939, respectively. During 2017, the Company incurred $186 in interest on the floor plan arrangements. During the year ended December 31, 2016 from the date of the Dejana acquisition of July 15, 2016 through December 31, 2016, the Company incurred $92 in interest on the floor plan arrangements. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Expenses and Other Current Liabilities | |
Accrued Expenses and Other Current Liabilities | 8. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities are summarized as follows: December 31, 2017 2016 Payroll and related costs $ $ Employee benefits Accrued warranty Earnout - Dejana - Other $ $ |
Warranty Liability
Warranty Liability | 12 Months Ended |
Dec. 31, 2017 | |
Warranty Liability | |
Warranty Liability | 9. 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 one to 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 $5,677 at December 31, 2017 of which $2,415 is included in Other long term liabilities and $3,262 is included in Accrued expenses and other current liabilities in the accompanying Consolidated Balance Sheet. At December 31, 2016, the warranty reserve is $6,160 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 Consolidated Balance Sheet. The following is a rollforward of the Company’s warranty liability: December 31, 2017 2016 2015 Balance at the beginning of the period $ $ $ Establish warranty liability for Dejana - 35 - Establish warranty liability for Arrowhead 65 - - Warranty provision 2,506 2,452 4,931 Claims paid/settlements Balance at the end of the period $ $ $ |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Taxes | |
Income Taxes | 10. Income Taxes The provision for income tax expense (benefit) consists of the following: Year ended December 31 2017 2016 2015 Current: Federal $ 11,897 $ 16,664 $ 15,298 State 988 1,866 2,057 12,885 18,530 17,355 Deferred: Federal (17,264) State 1,970 1,227 (1,371) $ $ $ A reconciliation of income tax expense computed at the federal statutory rate to the provision for income taxes for the years ended December 31, 2017, 2016 and 2015 is as follows: 2017 2016 2015 Federal income tax expense at statutory rate $ 18,520 $ 22,294 $ 23,192 State taxes, net of federal benefit 1,539 2,547 1,077 Valuation allowance changes - (7) (1,028) Change in uncertain tax positions, net 1,043 50 43 Research and development credit (160) (274) (241) State rate change 240 64 (30) Manufacturing tax benefits (933) (1,248) (1,302) Prior period adjustments - 1,096 - Federal deferred rate change (22,452) - - Other (206) 165 376 $ $ $ Significant components of the Company’s deferred tax liabilities and assets are as follows: December 31, 2017 2016 Deferred tax assets: Allowance for doubtful accounts $ 259 $ 393 Inventory reserves 967 1,111 Warranty liability 1,421 2,244 Deferred compensation 781 548 Earnout liabilities 694 242 Pension and retiree health benefit obligations 3,242 5,432 Accrued vacation 656 866 Medical claims reserve 189 72 State net operating losses 3,386 2,853 Other accrued liabilities 2,092 2,967 Valuation allowance for state net operating losses (777) (640) Total deferred tax assets Deferred tax liabilities: Tax deductible goodwill and other intangibles (47,163) (63,324) Accelerated depreciation (5,084) (7,176) Other 68 (151) Total deferred tax liabilities (52,179) (70,651) Net deferred tax liabilities $ (39,269) $ (54,563) Deferred income tax balances reflect the effects of temporary differences between the carrying amount of assets and liabilities and their tax bases and are stated at enacted tax rates expected to be in effect when taxes are actually paid or recovered. State operating loss carry forwards for tax purposes will result in future tax benefits of approximately $3,386. These loss carry-forwards will begin to expire in 2021. The Company evaluated the need to maintain a valuation allowance against certain deferred tax assets. Based on this evaluation, which included a review of recent profitability, future projections of profitability, and future deferred tax liabilities, the Company concluded that a valuation allowance of approximately $777 is necessary at December 31, 2017 for the state net operating loss carry-forwards which are likely to expire prior to the Company's ability to use the tax benefit. A reconciliation of the beginning and ending liability for uncertain tax positions is as follows: 2017 2016 2015 Balance at beginning of year $ $ $ Increases for tax positions taken in the current year Increases for tax positions taken in the prior years - Decreases due to settlements with taxing authorities (8) (11) - Decreases due to lapses in the statute of limitations (521) - - Balance at the end of year $ 3,531 $ 2,361 $ 490 The amount of the unrecognized tax benefits that would affect the effective tax rate, if recognized, was approximately $1,706 at December 31, 2017. The Company recognizes interest and penalties related to the unrecognized tax benefits in income tax expense. Approximately $804 and $79 of accrued interest and penalties is reported as an income tax liability at December 31, 2017 and 2016, respectively. The liability for unrecognized tax benefits is reported in Other Long‑term Liabilities on the consolidated balance sheets at December 31, 2017 and 2016. The Company files income tax returns in the United States (federal) and various states. Tax years open to examination by tax authorities under the statute of limitations include 2014, 2015 and 2016 for Federal and 2013 through 2016 for most states. The Federal 2012, 2013 and 2015 audits have been closed. The IRS Audit on the 2015 Federal tax return was substantially complete in 2017 but the statute of limitations is still open for this tax year. Tax returns for the 2017 tax year have not yet been filed. On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act (“The Act”). Over the long term, the Company generally expects to benefit from the lower statutory rates provided by The Act and is currently assessing all other aspects relevant to the Company. The Company operates solely in the United States; therefore, the international provisions of The Act do not apply. The Company is assessing the impact of the provisions of The Act, most of which do not apply until 2018. The only material item that impacts the Company for 2017 is the reduction in the deferred tax rate. As a result of the reduction in the U.S. corporate income tax rate from 35.0 percent to 21.0 percent under The Act, the Company has recorded a provisional reduction to its net deferred tax liability of $22,452, and a corresponding decrease to income tax expense in the Company’s Consolidated Statement of Operations for the year ended December 31, 2017. On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of The Act. The Company has recognized the provisional tax impacts related to the revaluation of deferred tax assets and liabilities and included these amounts in its consolidated financial statements for the year ended December 31, 2017. The ultimate impact may differ from these provisional amounts, possibly materially, due to, among other things, additional analysis, changes in interpretations and assumptions the Company has made, additional regulatory guidance that may be issued, and actions the Company may take as a result of The Act. The accounting is expected to be complete when the 2017 U.S. corporate income tax return is filed in 2018. |
Employee Retirement Plans
Employee Retirement Plans | 12 Months Ended |
Dec. 31, 2017 | |
Employee Retirement Plans | |
Employee Retirement Plans | 11. Employee Retirement Plans Pension benefits The Company provides noncontributory defined benefit pension plans for certain employees. Plans covering salaried employees generally provide pension benefits that are based on the employee’s average earnings and credited service. Such plans were partially frozen as of December 31, 2011. Plans covering hourly employees generally provide benefits of stated amounts for each year of service. Such plans were frozen as of December 31, 2011. The Company’s funding policy for the plans is to contribute amounts sufficient to meet the minimum funding requirement of the Employee Retirement Income Security Act of 1974, plus any additional amounts that the Company may determine to be appropriate. The reconciliation of the beginning and ending balances of the fair value of plan assets, funded status of plans, and amounts recognized in the consolidated balance sheets consisted of the following: December 31 2017 2016 Benefit obligation at beginning of year $ 39,407 $ 37,217 Service cost 356 321 Interest cost 1,613 1,639 Actuarial loss 3,571 1,469 Benefits paid (1,283) (1,239) Benefit obligation at end of year 43,664 39,407 Fair value of plan assets at beginning of year 29,223 26,378 Actual return on plan assets 4,294 2,373 Employer contributions through December 31 1,669 1,711 Benefits paid (1,283) (1,239) Fair value of plan assets at end of year 33,903 29,223 $ (9,761) $ (10,184) The components of net periodic pension cost consisted of the following for the years ended December 31, 2017 2016 2015 Components of net periodic pension cost: Service cost $ $ $ Interest cost 1,613 1,639 1,489 Expected return on plan assets Amortization of net loss 723 724 1,021 Net periodic pension cost $ 902 $ 860 $ 1,137 The accumulated benefit obligation for all pension plans as of December 31, 2017 and 2016, was $42,876 and $38,799, respectively. In accordance with its adoption of ASC 715‑20, the Company uses December 31 as its measurement date for all periods presented. Assumptions used in determining net periodic pension cost for the plans consisted of the following: Year ended December 31 2017 2016 2015 Discount rates % 4.5 % 3.9% - 4.0 % Rates of increase in compensation levels: Salaried Hourly N/A N/A N/A Expected long-term rate of return on assets The discount rate used to determine the benefit obligation at December 31, 2017 was 3.6% for both the hourly and salaried pension plans. Meanwhile the discount rate used to determine the benefit obligation at December 31, 2016 was 4.2% for the both the hourly and salaried pension plans. For 2018, the expected long‑term rate of return on plan assets is 5.80% for the salaried plan and 6.50% for the hourly plan. To determine the long‑term rate of return assumption for plan assets, the Company studies historical markets and preserves the long‑term historical relationships between equities and fixed‑income securities consistent with the widely accepted capital market principle that assets with higher volatility generate a greater return over the long run. The Company evaluates current market factors such as inflation and interest rates before it determines long‑term capital market assumptions and reviews peer data and historical returns to check for reasonableness and appropriateness. The expected benefit payments under the pension plans are as follows: 2018 $ 2019 2020 2021 2022 2023-2027 The Company made required minimum pension funding contributions of $169 and voluntary contributions of $1,500 to the pension plans in 2017 and currently expects to make $72 of required minimum pension funding contributions in 2018. The Company maintains target allocation percentages among various asset classes based on an investment policy established for the pension plans, which is designed to achieve long‑term objectives of return, while mitigating downside risk and considering expected cash flows. The current weighted‑average target asset allocations are reflective of actual investments at December 31, 2017 and 2016. The investment policy is reviewed periodically in order to achieve overall objectives in light of current circumstances. The Company’s weighted‑average asset allocation and actual allocation for the qualified hourly pension plan by asset category at December 31 is as follows: Target 2017 2016 Large Cap Equity % $ % $ % Mid Cap Equity % % % Small Cap Equity % % % International Equity % % % Emerging Markets Equity % 128 % 88 % Fixed Income and Cash Equivalents % % % Real Estate % 382 % 333 % Total % $ % $ % The Company’s weighted‑average asset allocation and actual allocation for the qualified salaried pension plan by asset category at December 31 is as follows: Target 2017 2016 Large Cap Equity % $ % $ % Mid Cap Equity % % % Small Cap Equity % % % International Equity % % % Emerging Markets Equity % 348 % 374 % Fixed Income and Cash Equivalents % % % Real Estate % 1,644 % 1,415 % Total % $ % $ % The investment strategy is to build an efficient, well‑diversified portfolio based on a long‑term, strategic outlook of the investment markets. The investment market outlook utilizes both historical‑based and forward‑looking return forecasts to establish future return expectations for various asset classes. These return expectations are used to develop a core asset allocation based on the needs of the plan. The core asset allocation utilizes investment portfolios of various asset classes and multiple investment managers in order to help maximize the plan’s return while providing multiple layers of diversification to help minimize risk. The following table presents the fair values of the plan assets related to the Company’s pension plans within the fair value hierarchy as defined in Note 2. The fair values of the Company’s pension plan assets as of December 31, 2017 are as follows: Balance as of December 31, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Equity holdings $ $ — $ $ — Fixed-income holdings — — Alternative investments 2,026 — — 2,026 Total pension plan assets $ $ — $ $ The fair values of the Company’s pension plan assets as of December 31, 2016 are as follows: Balance as of December 31, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Equity holdings $ $ — $ $ — Fixed-income holdings — — Alternative investments 1,748 — — 1,748 Total pension plan assets $ $ — $ $ Level 2 investments are based on quoted prices for similar assets in markets that are not active while Level 3 investments are comprised of a real estate fund for which the fair value is determined by taking the appraised values of the properties on hand plus other assets and subtracting mortgage loans and other liabilities. The following table presents a reconciliation of the fair value measurements using significant unobservable inputs (Level 3): December 31, 2017 2016 Balance, beginning of year $ 1,748 $ 1,364 Deposits 101 Actual return on plan assets held at reporting date 138 Withdrawals 145 Balance, end of year $ 2,026 $ 1,748 Postretirement benefits The Company provides postretirement healthcare benefits for certain employee groups. The postretirement healthcare plans are contributory and contain certain other cost‑sharing features such as deductibles and coinsurance. The plans are unfunded. Employees do not vest until they retire from active employment with the Company and have at least twelve years of service. These benefits can be amended or terminated at anytime and are subject to the same ongoing changes as the Company’s healthcare benefits for employees with respect to deductible, co‑insurance and participant contributions. Effective January 1, 2004, the postretirement healthcare benefits were extended to all active employees of the Company as of December 31, 2003. The period of coverage was reduced and the retiree contribution percentage was increased in order to keep the cost of the plan equivalent to the previous plan design. Maximum coverage under the plan is limited to ten years. All benefits terminate upon the death of the retiree. Employees who began working for the Company after December 31, 2003, are not eligible for postretirement healthcare benefits. The reconciliation of the beginning and ending balances of the projected benefit obligation for the Company consisted of the following: December 31 2017 2016 Change in projected benefit obligation: Benefit obligation at beginning of year $ $ Service cost Interest cost Participant contributions Changes in actuarial assumptions (853) 53 Benefits paid (39) (142) Projected benefit obligation at end of year $ $ Amounts recognized in the consolidated balance sheets consisted of: Accrued expenses and other current liabilities $ $ Retiree health benefit obligation $ 6,949 $ 7,333 The components of postretirement healthcare benefit cost consisted of the following for the year ended December 31, 2017 2016 2015 Components of net postretirement health benefit cost: Service cost $ $ $ 229 Interest cost 278 256 Amortization of net gain (107) (127) (69) Net postretirement healthcare benefit cost (income) $ 376 $ 361 $ 416 The assumed discount and healthcare cost trend rates are summarized as follows: Year Ended December 31 2017 2016 2015 Discount rate % % % Immediate healthcare cost trend rate * ** *** Ultimate healthcare cost trend rate Assumed annual reduction in trend rate * ** *** Participation * ** *** The discount rate used to determine the benefit obligation at December 31, 2017 and 2016 is 4.1% and 3.7%, respectively. For December 31, 2017, the health care cost trend rate is assumed to be 7.0% beginning in 2017 gradually reducing to an ultimate rate of 4.5% in 2026. For December 31, 2016, the health care cost trend rate is assumed to be 7.0% beginning in 2016 gradually reducing to an ultimate rate of 4.5% in 2025. For December 31, 2015, the health care cost trend rate is assumed to be 7.0% beginning in 2015 gradually reducing to an ultimate rate of 4.5% in 2024. A one percentage point change in the healthcare cost trend rate would have the following effect at December 31, 2017: 1% 1% Increase Decrease Effect on total service and interest cost $ 54 $ (46) Effect on postretirement benefit obligation (669) Amounts included in other comprehensive loss, net of tax, at December 31, 2017, which have not yet been recognized in net periodic pension or OPEB cost, were net actuarial gain (loss) of ($6,636) and $1,392 for the pension plans and postretirement healthcare benefit plans, respectively. The estimated actuarial gain (loss) for the defined benefit plans that will be amortized from accumulated other comprehensive loss into net periodic pension or OPEB cost during 2018 are ($706) and $211 for the pension plans and postretirement healthcare benefit plans, respectively. Defined contribution plan The Company has a defined contribution plan, which qualifies under Section 401(k) of the Internal Revenue Code and provides substantially all employees an opportunity to accumulate personal funds for their retirement. Contributions are made on a before‑tax basis to the plan and are invested, at the employees’ direction, among a variety of investment alternatives including, commencing January 1, 2013, a Company common stock fund designated as an employee stock ownership plan. As determined by the provisions of the plan, the Company matches a portion of the employees’ basic voluntary contributions. The Company matching contributions to the plan were approximately $625, $863 and $377 for the years ended December 31, 2017, 2016 and 2015, respectively. Beginning January 1, 2012, the Company amended its defined contribution plan to permit non‑discretionary employer contributions. The Company made non‑discretionary employer contributions of $1,128, $901 and $1,264 in the years ended December 31, 2017, 2016 and 2015, respectively. The Company additionally made contributions in the year ended December 31, 2015 of $299 into a separate Henderson defined contribution plan. The Company merged the plan into the Douglas Dynamics, L.L.C. 401(k) plan in 2016. The Company additionally made contributions in the year ended December 31, 2016 of $119 into a separate Dejana defined contribution plan. The Company intends to merge the Dejana plan into the Douglas Dynamics, L.L.C. 401(k) plan in 2018. Non‑qualified plan The Company also maintains a supplemental non‑qualified plan for certain officers and other key employees. Expense for this plan was $526, $511 and $496 for the years ended December 31, 2017, 2016 and 2015, respectively. The amount accrued was $4,980, $3,471 and $2,482 as of December 31, 2017, 2016 and 2015, respectively. Amounts were determined based on the fair value of the liability at December 31, 2017, 2016 and 2015, respectively. The Company holds assets that substantially equivalent to the liability and are intended to fund the liability. |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Stock Based Compensation | |
Stock Based Compensation | 12. Stock‑Based Compensation Amended and Restated 2004 Stock Incentive Plan As of December 31, 2017, no additional shares of common stock were reserved for issuance upon the exercise of stock options under the Company’s Amended and Restated 2004 Stock Incentive Plan (the “A&R 2004 Plan”). No further awards are permitted to be issued under the A&R 2004 Plan. 2010 Stock Incentive Plan In connection with the IPO, in May 2010, the Company’s Board of Directors and stockholders adopted the 2010 Stock Incentive Plan (the “2010 Plan”). The material terms of the performance goals under the 2010 Plan, as amended and restated, were approved by stockholders at the Company’s 2014 annual meeting of stockholders. The 2010 Plan provides for the issuance of nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock awards and restricted stock units, 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. As of December 31, 2017, the Company had 1,147,750 shares of common stock available for future issuance of awards under the 2010 Plan. The shares of common stock to be issued under the 2010 Plan will be made available from authorized and unissued Company common stock. Stock Options There were no stock options exercised in the years ended December 31, 2017 and 2016. There were 26,350 stock options exercised with respect to the Company’s stock under the A&R 2004 Plan during the year ended December 31, 2015. The option holder paid the Company the required aggregate exercise price of $111 for options exercised at the time of the exercise. Stock options were previously expensed over the vesting period and therefore no additional expense was recorded at the time of the exercise. There were no outstanding stock options at December 31, 2017, 2016 or 2015. There were 10,890 shares that were cancelled during the year ended December 31, 2015. As of December 31, 2017, December 31, 2016 and December 31, 2015, there were no unexercised stock options. Restricted Stock Restricted stock carries both voting and dividend rights. There was no restricted stock activity in the year ended December 31, 2017. A summary of restricted stock activity for the years ended December 31, 2016 and 2015 is as follows: Weighted Weighted Average Average Grant Remaining Date Contractual Shares Fair value Term Unvested at December 31, 2014 85,021 years Granted — — — years Vested (70,320) Cancelled and forfeited — — Unvested at December 31, 2015 14,701 years Granted — — — Vested (14,701) 14.78 Cancelled and forfeited — — Unvested at December 31, 2016 - - - years The fair value of the Company’s restricted stock awards is the closing stock price on the date of grant. The Company recognized $0, $0 and $385 of compensation expense related to restricted stock awards for the years ended December 31, 2017, 2016, and 2015, respectively. There was no unrecognized compensation expense for shares expected to vest as of December 31, 2017, 2016 and 2015. Restricted Stock Units Restricted stock units (“RSUs”) are granted to both non‑employee directors and management. Prior to 2013, RSUs were only issued to directors. However, in 2013, the Company changed the timing and form of management’s annual stock grants and began to grant RSUs to management. For both non‑employee directors and management, RSUs carry dividend equivalent rights but do not carry voting rights. 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. In 2013, the Company’s compensation committee approved a retirement provision for RSUs issued to management. The retirement provision provides that 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, $528 and $303 in additional expense in the years ended December 31, 2017, 2016 and 2015, respectively, as a result of accelerated stock based compensation expense for employees who meet the thresholds of the retirement provision. The Company’s nominating and governance committee also 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 years ended December 31, 2017, 2016 and 2015 is as follows: Weighted Weighted Average Average Grant Remaining Date Contractual Shares Fair value Term Unvested at December 31, 2014 81,623 years Granted 116,141 years Vested (147,217) Cancelled and forfeited (1,882) Unvested at December 31, 2015 years Granted 131,765 years Vested (132,640) 20.27 Cancelled and forfeited — — Unvested at December 31, 2016 years Granted 128,893 24.31 years Vested (128,697) 22.93 Cancelled and forfeited (444) Unvested at December 31, 2017 $ years Expected to vest in the future at December 31, 2017 $ years The Company recognized $1,732, $1,516 and $1,643 of compensation expense related to the RSU awards in the years ended December 31, 2017, 2016 and 2015, respectively. The unrecognized compensation expense, net of expected forfeitures, calculated under the fair value method for shares that were, as of December 31, 2017, expected to be earned through the requisite service period was approximately $461 and is expected to be recognized through 2020. Vested 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. Performance Share Unit Awards The Company granted performance share units as performance based awards under the 2010 Plan in the first quarter of 2017, 2016 and 2015 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 of which one third will vest immediately upon issuance. The remaining RSUs issued 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. As of December 31, 2017, the performance conditions for share units granted in the year ended December 31, 2017 have been met. Thus, in the first quarter of 2018, management estimates that 64,040 performance share units will be converted into RSUs. In the first quarter of 2017 and 2016 there were 87,876 and 71,428 performance share units that converted into RSUs, respectively. Upon conversion, the first third of the RSUs issued will immediately vest and be converted into common shares. The remaining two thirds of the RSUs issued will vest ratably over the remaining two‑year vesting period. The fair value per share of the awards is the closing stock price on the date of grant, which was $33.60, $19.88 and $22.63 for the 2017, 2016 and 2015 grants, respectively. The Company recognized $1,768, $1,382 and $1,247 of compensation expense related to the awards granted in the years ended December 31, 2017, 2016, and 2015, respectively. The unrecognized compensation expense calculated under the fair value method for shares that were, as of December 31, 2017, expected to be recognized through the requisite service period was $424 and is expected to be recognized through 2020. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share | |
Earnings (Loss) per Share | 13. 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 and common stock equivalents related to the assumed exercise of stock options, using the two‑class method. Stock options for which the exercise price exceeds the average fair value have an anti‑dilutive effect on earnings per share and are excluded from the calculation. There were no shares excluded from diluted earnings per share for the years presented. All restricted stockholders and RSU and performance share unit holders participate in dividends (through dividend equivalents, in the case of the RSUs and performance share units). Thus, 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. 2017 2016 2015 Basic earnings per common share Net income $ 55,324 $ 39,009 $ 44,176 Less income allocated to participating securities 715 540 604 Net income allocated to common shareholders $ 54,609 $ 38,469 $ 43,572 Weighted average common shares outstanding 22,576,381 22,480,679 22,329,044 $ 2.42 $ 1.71 $ 1.95 Earnings per common share assuming dilution Net income $ 55,324 $ 39,009 $ 44,176 Less income allocated to participating securities 715 540 604 Net income allocated to common shareholders $ 54,609 $ 38,469 $ 43,572 Weighted average common shares outstanding 22,576,381 22,480,679 22,329,044 Incremental shares applicable to stock based compensation 11,267 - 12,731 Weighted average common shares assuming dilution 22,587,648 22,480,679 22,341,775 $ 2.40 $ 1.70 $ 1.94 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies | |
Commitments and Contingencies | 14. 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, consolidated results of operations or liquidity. In addition, the Company is not currently a party to any environmental‑related claims or legal matters. The Company leases facilities under non-cancelable operating leases, some of which contain renewal options. Total future minimum lease payments consisted of the following at December 31, 2017 : Related Party Leases Third Party Leases Total Leases 2018 $ $ $ 2019 2020 2021 2022 Thereafter Total lease obligations $ 15,788 $ 6,132 $ 21,920 The Company entered into lease agreements at the time of the close of the Dejana acquisition with parties that are affiliated with the former owners of Dejana and are still employed at Dejana post - acquisition. The related parties continue to own land and buildings where Dejana conducts business. The Company incurred $3,561 of total operating lease rent expense in the year ended 2017, of which $1,918 were to related parties. The Company incurred $1,665 of total operating lease rent expense in the year ended 2016, of which $797 were to related parties. As the Company makes monthly payments to the related parties, there are no amounts owed to the related parties at December 31, 2017 or 2016. |
Segments
Segments | 12 Months Ended |
Dec. 31, 2017 | |
Segments | |
Segments | 15. 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. 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 the Company’s operations that, prior to the acquisition of Dejana, was a 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 upfit 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, gross margin and operating income. Items not allocated to segment operating income include corporate administrative expenses and certain other amounts that include various support functions, such as information technology, corporate finance, legal, executive administration and human resources. No single customer’s revenues amounted to 10% or more of the Company’s total revenue. Sales are primarily within the United States and substantially all assets are located within the United States . The following table shows summarized financial information concerning the Company’s reportable segments: 2017 2016 2015 Net sales Work Truck Attachments $ $ $ Work Truck Solutions - Corporate & Eliminations (13,407) (9,414) 501 $ $ $ Selling, general, and administrative expense Work Truck Attachments $ $ $ Work Truck Solutions - Corporate & Eliminations $ $ $ Income (loss) from operations Work Truck Attachments $ $ $ Work Truck Solutions 9,825 3,077 - Corporate & Eliminations (17,822) (19,847) (16,138) $ $ $ 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 - - $ $ $ |
Stockholders' equity
Stockholders' equity | 12 Months Ended |
Dec. 31, 2017 | |
Stockholders' equity | |
Stockholders' equity | 16. Stockholders’ equity Preferred Stock The Company is authorized to issue 5,000,000 shares of preferred stock, par value $0.01 per share. Subject to any limitations under law or the Company’s certificate of incorporation, the Company’s board of directors is authorized to provide for the issuance of the shares of preferred stock in one or more series; to establish the number of shares to be included in each series; and to fix the designation, powers, privileges, preferences, relative participating, optional or other rights (if any), and the qualifications, limitations or restrictions of the shares of each series. As of December 31, 2017 and 2016, no shares of preferred stock were issued and outstanding. Common Stock The Company has 200,000,000 shares of common stock authorized, of which 22,590,897 and 22,501,640 shares were issued and outstanding as of December 31, 2017 and 2016, respectively. The par value of the common stock is $0.01 per share. The holders of common stock are entitled to one vote per share on all matters submitted to a vote of stockholders. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, common stockholders would be entitled to share ratably in the Company’s assets and funds remaining after payment of liabilities. |
Valuation and qualifying accoun
Valuation and qualifying accounts | 12 Months Ended |
Dec. 31, 2017 | |
Valuation and qualifying accounts | |
Valuation and qualifying accounts | 17. Valuation and qualifying accounts The Company’s valuation and qualifying accounts for the years ended December 31, 2017, 2016 and 2015 are as follows: Balance at Additions Changes to Balance at beginning charged to reserve, net(1) end of year of year earnings Year ended December 31, 2017 Allowance for doubtful accounts $ 1,158 $ 1,475 $ (1,577) $ 1,056 Valuation of deferred tax assets 640 - 137 777 Year ended December 31, 2016 Allowance for doubtful accounts $ 1,343 $ 208 $ (393) $ 1,158 Valuation of deferred tax assets - (7) 640 Year ended December 31, 2015 Allowance for doubtful accounts $ 1,667 $ 305 $ (629) $ 1,343 Valuation of deferred tax assets - (953) 647 (1) Increases (deductions) from the allowance for doubtful accounts equal accounts receivable written off and increases related to acquired businesses, less recoveries, against the allowance. Increases (deductions) to the valuation of deferred tax assets relate to the reversals due to changes in management’s judgments regarding the future realization of the underlying deferred tax assets. |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Loss by Component | 12 Months Ended |
Dec. 31, 2017 | |
Changes in Accumulated Other Comprehensive Loss by Component | |
Changes in Accumulated Other Comprehensive Loss by Component | 18. Changes in Accumulated Other Comprehensive Loss by Component Changes to accumulated other comprehensive loss by component for the year ended December 31, 2017 is 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 (338) 521 (670) (487) Amounts reclassified from accumulated other comprehensive loss: (1) 205 (66) 448 587 Balance at December 31, 2017 $ (1,328) $ 1,392 $ (6,636) $ (6,572) (1) Amounts reclassified from accumulated other comprehensive loss: Amortization of Other Postretirement Benefit items: Actuarial gains (a) (107) Tax expense 41 Reclassification net of tax $ (66) Amortization of pension obligation: Actuarial losses (a) 723 Tax benefit (275) Reclassification net of tax $ 448 Unrealized losses on interest rate swaps reclassified to interest expense 330 Tax benefit (125) Reclassification net of tax $ 205 (a) – These components are included in the computation of benefit plan costs in Note 11. Changes to accumulated other comprehensive loss by component for the year ended December 31, 2016 is 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 gain (loss) before reclassifications (500) (32) (569) (1,101) Amounts reclassified from accumulated other comprehensive loss: (1) 242 (79) 449 612 Balance at December 31, 2016 $ (1,195) $ 937 $ (6,414) $ (6,672) (1) Amounts reclassified from accumulated other comprehensive loss: Amortization of Other Postretirement Benefit items: Actuarial gain (a) (127) Tax expense 48 Reclassification net of tax $ (79) Amortization of pension obligation: Actuarial losses (a) 724 Tax benefit (275) Reclassification net of tax $ 449 Unrealized losses on interest rate swaps reclassified to interest expense 390 Tax benefit (148) Reclassification net of tax $ 242 (a) – These components are included in the computation of benefit plan costs in Note 11. |
Quarterly Financial Information
Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information (unaudited) | |
Quarterly Financial Information (Unaudited) | 19. Quarterly Financial Information (Unaudited) 2017 First Second Third Fourth Net sales $ 72,248 $ 139,371 $ 125,339 $ 137,969 Gross profit $ 17,187 $ 45,033 $ 36,055 $ 44,811 Income (loss) before taxes $ (5,971) $ 22,354 $ 15,081 $ 21,451 Net income (loss) $ (3,277) $ 14,746 $ 9,327 $ 34,528 Basic net earnings (loss) per common share attributable to common shareholders $ (0.14) $ 0.64 $ 0.41 $ 1.51 Earnings (loss) per common share assuming dilution attributable to common shareholders $ (0.14) $ 0.64 $ 0.40 $ 1.50 Dividends per share $ 0.24 $ 0.24 $ 0.24 $ 0.24 Results for the year ended December 31, 2016 include Dejana which was purchased on July 15, 2016. Additionally, the first quarter of 2016 includes the impact of litigation proceeds of $10,050. 2016 First Second Third Fourth Net sales $ 48,789 $ 113,763 $ 123,573 $ 130,143 Gross profit $ 14,131 $ 41,521 $ 36,644 $ 41,678 Income before taxes $ 8,606 $ 25,551 $ 11,873 $ 17,666 Net income $ 5,278 $ 16,328 $ 7,302 $ 10,101 Basic net earnings per common share attributable to common shareholders $ 0.23 $ 0.72 $ 0.32 $ 0.44 Earnings per common share assuming dilution attributable to common shareholders $ 0.23 $ 0.71 $ 0.32 $ 0.44 Dividends per share $ 0.24 $ 0.24 $ 0.24 $ 0.24 Due to changes in stock prices during the year and timing of issuance of shares, the sum of quarterly earnings per share may not equal the annual earnings per share. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2017 | |
Recent Accounting Pronouncements | |
Recent Accounting Pronouncements | 20. Recent Accounting Pronouncements 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 adopted ASC 606 using the modified retrospective method as of January 1, 2018. This approach was applied to all contracts not completed as of the date of initial application. The Company assessed the impact of the standard through contract testing at each of the Company’s reporting units. Upon adoption, the Company will recognize the cumulative effect of adopting this guidance as an adjustment to the opening balance of retained earnings. The Company expects this adjustment to retained earnings to be less than $0.4 million, with an expected impact to revenue in the range of $2.0 to $4.0 million, and an immaterial impact to net income on an ongoing basis. Prior periods will not be retrospectively adjusted. Due to the complexity of certain customer contracts, the actual revenue recognition treatment required under the new standard for these arrangements may be dependent on contract-specific terms and therefore may vary in some instances. Based on its evaluation of the standard, the Company does not expect a material impact on its revenue recognition practices. The Company has identified and implemented changes to processes and controls to meet the standard’s updated reporting and disclosure requirements. In February 2016, the FASB issued ASU 2016-02, Leases , which, among other things, requires lessees to recognize most leases on-balance sheet. The standard requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous GAAP. The amended guidance will become effective for the Company commencing in the first quarter of 2019. Entities are required to use a modified retrospective approach, with early adoption permitted. The Company is reviewing the revised guidance and assessing the impact on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-05 Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships . This amendment clarifies that a change in the counterparty to a derivative instrument does not on its own require dedesignation of the hedging instrument under Topic 815, provided that all other hedge accounting criteria (including those in paragraphs 815-20-35-14 through 35-18) continue to be met. This update can be applied prospectively or retrospectively and is effective for fiscal years beginning after December 15, 2017, and interim periods within those years. This update is not expected to have an impact on the Company’s consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which amends guidance on the classification of certain cash receipts and payments in the statement of cash flows. The amended guidance will become effective for the Company commencing in the first quarter of 2018. Early adoption is permitted. The Company is currently evaluating the impact of this new standard on its consolidated financial statements. 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. The Company will adopt this standard as of January 1, 2018. Net periodic benefit cost for pensions and other postretirement benefits for the years ended December 31, 2017 and 2016 were $1,278 and $1,221 of which $561 and $531, respectively, related to service cost. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities , which amends and simplifies existing guidance to improve the transparency and understandability of information and to allow companies to more accurately present the economic effects of risk management activities in the financial statements. The amendments in this ASU are effective for annual periods beginning after December 15, 2018 and interim periods within those annual periods, with early adoption permitted. The Company is currently evaluating the impact of this new standard on its consolidated financial statements. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events | |
Subsequent Events | 21. Subsequent Events On February 5, 2018, the Company entered into interest rate swap agreements to reduce its exposure to interest rate volatility. The two interest rate swap agreements have notional amounts of $50,000 and $150,000 effective for the periods December 31, 2018 through June 30, 2021 and June 30, 2021 through December 10, 2021, respectively. The Company expects the two interest rates swaps are accounted for as cash flow hedges. 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, 2018, the Company will either receive or make payments on a monthly basis based on the differential between 2.613% and LIBOR. Under the interest rate swap agreement effective as of June 30, 2021, the Company will either receive or make payments on a monthly basis based on the differential between 2.793% and LIBOR. |
Summary of Significant Accoun31
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies | |
Principles of consolidation | Principles of consolidation The accompanying consolidated financial statements include the accounts of Douglas Dynamics, Inc. and its direct wholly‑owned subsidiary, Douglas Dynamics, L.L.C., and its wholly‑owned subsidiaries, Douglas Dynamics Finance Company (an inactive subsidiary), Fisher, LLC, Henderson Enterprises Group, Inc., Henderson Products, Inc. and Dejana Truck & Utility Equipment Company, LLC (hereinafter collectively referred to as the “Company”). All intercompany balances and transactions have been eliminated in consolidation. |
Use of estimates | Use of estimates The preparation of the financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Accordingly, actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and cash equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents are carried at cost, which approximates fair value. |
Accounts receivable and allowance for doubtful accounts | Accounts receivable and allowance for doubtful accounts The Company carries its accounts receivable at their face amount less an allowance for doubtful accounts. The majority of the Company’s accounts receivable are due from distributors of truck equipment and dealers of completed upfit trucks. Credit is extended based on an evaluation of a customer’s financial condition. On a periodic basis, the Company evaluates its accounts receivable and establishes the allowance for doubtful accounts based on a combination of specific customer circumstances and credit conditions based on a history of write‑offs and collections. A receivable is considered past due if payments have not been received within agreed upon invoice terms. Accounts receivable are written off after all collection efforts have been exhausted. The Company takes a security interest in the inventory as collateral for the receivable but often does not have a priority security interest. |
Financing program | Financing program The Company is party to a financing program in which certain distributors may elect to finance their purchases from the Company through a third party financing company. The Company provides the third party financing company recourse against the Company regarding the collectability of the receivable under the program due to the fact that if the third party financing company is unable to collect from the distributor the amounts due in respect of the product financed, the Company would be obligated to repurchase any remaining inventory related to the product financed and reimburse any legal fees incurred by the financing company. During the years ended December 31, 2017, 2016 and 2015, distributors financed purchases of $7,115, $7,578 and $7,584 through this financing program, respectively. At both December 31, 2017 and December 31, 2016, there were no uncollectible outstanding receivables related to sales financed under the financing program. The amount owed by distributors to the third party financing company under this program at December 31, 2017 and 2016 was $3,436 and $6,767, respectively. The Company was required to repurchase repossessed inventory of $0, $0, and $13 for the years ended December 31, 2017, 2016 and 2015, respectively. In the past, minimal losses have been incurred under this agreement. However, an adverse change in distributor retail sales could cause this situation to change and thereby require the Company to repurchase repossessed units. Any repossessed units are inspected to ensure they are current, unused product and are restocked and resold. |
Interest Rate Swap | Interest Rate Swap The Company is a counterparty to interest-rate swap agreements to hedge against the potential impact on earnings from increases in market interest rates. The Company entered into three interest rate swap agreements during the first quarter of 2015 with 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. All three interest rate swap agreements are accounted for as cash flow hedges. 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 3.00% (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 3.00% (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 3.00% (with a LIBOR floor of 1.0%). The negative fair value of the interest rate swap, net of tax, of ($1,328) and ($1,195) at December 31, 2017 and December 31, 2016, respectively, is included in Accumulated other comprehensive loss on the balance sheet. This fair value was determined using Level 2 inputs as defined in Accounting Standards Codification Topic (“ASC”) 820 - Fair Value Measurements and Disclosures. |
Inventories | Inventories Inventories are stated at the lower of cost or market. Market is determined based on estimated realizable values. Inventory costs are primarily determined by the first‑in, first‑out (FIFO) method. The Company periodically reviews its inventory for slow moving, damaged and discontinued items and provides reserves to reduce such items identified to their recoverable amounts. The Company records inventories to include truck chassis inventory financed through a floor plan financing agreement as discussed in Note 7. The Company takes title to truck chassis upon receipt of the inventory through their floor plan agreement and performs upfitting 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 December 31, 2017 and 2016, the Company had $7,711 and $3,939 of chassis inventory and related floor plan financing obligation, respectively. The Company recognizes revenue associated with upfitting and service installations net of the truck chassis. The Company receives, on consignment, truck chassis on which it performs upfitting 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 December 31, 2017 and 2016 was $17,447 and $22,420, respectively. The Company is responsible to the manufacturer for interest on chassis held for upfitting. The Company recognizes revenue associated with upfitting and service installations net of the truck chassis. |
Leases | Leases As of December 31, 2017, fifteen of the Company’s upfit and distribution centers were subject to a lease agreement. All of the Company’s current leases are considered operating leases, and are not recorded on the Company’s balance sheet. Rent expense is recognized on a straight-line basis over the expected lease term. The Company leases buildings in which it operates from both related party and third party lessors. See Note 14 for further details. |
Property, plant and equipment | Property, plant and equipment Property, plant and equipment are recorded at cost, less accumulated depreciation. Depreciation is computed using straight‑line methods over the estimated useful lives for financial statement purposes and an accelerated method for income tax reporting purposes. The estimated useful lives of the assets are as follows: Years Land improvements and buildings - 40 Leasehold improvements Machinery and equipment - 20 Furniture and fixtures - 12 Mobile equipment and other - 10 Depreciation expense was $7,183, $6,146, and $4,919 for the years ended December 31, 2017, 2016 and 2015, respectively. Expenditures for renewals and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized. Expenditures for maintenance and repairs are charged to operations when incurred. Repairs and maintenance expenses amounted to $5,222, $5,060 and $5,272 for the years ended December 31, 2017, 2016 and 2015, respectively. When assets are sold or retired, the cost of the asset and the related accumulated depreciation are eliminated from the accounts and any gain or loss is recognized in results of operations. |
Impairment of long-lived assets | Impairment of long‑lived assets Long‑lived assets are reviewed for potential impairment when events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of assets to be held and used is measured by comparison of the carrying value of such assets to the undiscounted future cash flows expected to be generated by the assets. If the carrying value of an asset exceeds its estimated undiscounted future cash flows, an impairment provision is recognized to the extent that the carrying amount of the asset exceeds its fair value. Assets to be disposed of are reported at the lower of the carrying amount or the fair value of the asset, less costs of disposition. Management of the Company considers such factors as current results, trends and future prospects, current market value, and other economic and regulatory factors in performing these analyses. The Company determined that no long‑lived assets were impaired as of December 31, 2017 and 2016. |
Goodwill and other intangible assets | Goodwill and other intangible assets Goodwill and indefinite‑lived intangible assets are tested for impairment annually as of December 31, or sooner if impairment indicators arise. The fair value of indefinite‑lived intangible assets is estimated based upon an income and market approach. In reviewing goodwill for impairment, potential impairment is identified by comparing the estimated fair value of the reporting units to its carrying value. The Company has determined it has three reporting units. When the fair value is less than the carrying value of the net assets of the reporting unit, including goodwill, an impairment loss may be recognized. The Company has determined that goodwill and indefinite lived assets were not impaired as of December 31, 2017 and 2016. The Company had goodwill of $241,006 and $238,286 at December 31, 2017 and 2016, respectively, of which $160,932 relates to goodwill associated with the Work Truck Attachments segment at both December 31, 2017 and 2016 and $80,074 and $77,354 relates to the Work Truck Solutions segment at December 31, 2017 and 2016, respectively. Intangible assets with estimable useful lives are amortized over their respective estimated useful lives and are reviewed for potential impairment when events or circumstances indicate that the carrying amount of the asset may not be recoverable. The Company amortizes its distribution network intangible over periods ranging from 15 to 20 years, trademarks over 7 to 25 years, patents over 7 to 20 years, customer relationships over 15 to 19.5 years and noncompete agreements over 4 to 5 years. The Company acquired backlogs in conjunction with the Dejana and Henderson acquisitions on July 15, 2016 and December 31, 2014, respectively. The Dejana backlog was amortized in the same quarter as the acquisition. Meanwhile, the Henderson backlog was amortized in the first half of 2015. There were no indicators of impairment during the years ended December 31, 2017 and 2016. The Company had gross intangible assets and accumulated amortization of $275,675 and $89,525, respectively, for the year ended December 31, 2017, of which $195,175 and $81,336 relate to the Work Truck Attachments segment, and $80,500 and $8,189 relate to the Work Truck Solutions segment, respectively. The Company had gross intangible assets and accumulated amortization of $272,975 and $78,124, respectively for the year ended December 31, 2016, of which $195,175 and $74,432 relate to the Work Truck Attachments segment, and $77,800 and $3,692 relate to the Work Truck Solutions segment, respectively. |
Income taxes | Income taxes Deferred income taxes are accounted for under the asset and liability method whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates. Deferred income tax provisions or benefits are based on the change in the deferred tax assets and liabilities from period to period. Deferred income tax assets are reduced by a valuation allowance if it is more likely than not that some portion of the deferred income tax asset will not be realized. Additionally, when applicable, the Company would classify interest and penalties related to uncertain tax positions in income tax expense. |
Deferred financing costs | Deferred financing costs The costs of obtaining financing are capitalized and amortized over the term of the related financing on a basis that approximates the effective interest method. The changes in deferred financing costs are as follows: Balance at December 31, 2014 $ 2,485 Amortization of deferred financing costs (148) Balance at December 31, 2015 Deferred financing costs capitalized on new debt Amortization of deferred financing costs (624) Balance at December 31, 2016 Amortization of deferred financing costs Balance at December 31, 2017 $ |
Fair Value | 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 December 31, 2017 Fair Value at December 31, 2016 Assets: Other long-term assets (a) $ 4,840 $ 3,458 Total Assets $ 4,840 $ 3,458 Liabilities: Interest rate swaps (b) 2,178 1,985 Long term debt (c) 312,384 315,940 Earnout - Henderson (d) 529 636 Earnout - Dejana (e) 3,100 10,373 Total Liabilities $ 318,191 $ 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 amounts of these insurance policies approximates their fair value. (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 $597 and $1,581 at December 31, 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 financing 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 $87 and $442, respectively, at December 31, 2017 is the fair value of an obligation for a portion of the potential earn out acquired in conjunction with the acquisition of Henderson. Included in accrued expenses and other current liabilities and other long term liabilities in the amounts of $194 and $442, respectively, at December 31, 2016 is the fair value of an obligation for a portion of the potential earn out 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: December 31, 2017 2016 Beginning Balance $ 636 $ 761 Payment to former owners (107) (125) Ending balance $ 529 $ 636 (e) Included in Other long term liabilities in the amount of $3,100 at December 31, 2017 is the fair value of an obligation for a portion of the potential earn out 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 $5,487 and $4,886, respectively, at December 31, 2016 is the fair value of an obligation for a portion of the potential earn out incurred in conjunction with the acquisition of Dejana. The carrying amount of the earn out approximates its fair value. 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: December 31, 2017 2016 Beginning Balance $ 10,373 $ - Additions - 10,200 Adjustments to fair value (1,786) 173 Payment to former owners (5,487) - Ending balance $ 3,100 $ 10,373 |
Concentration of credit risk | Concentration of credit risk The Company’s cash is deposited with multiple financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. The Company has not experienced any losses in such accounts and believes that it is not exposed to any significant risk on these balances. No distributor represented more than 10% of the Company’s net sales or accounts receivable during the years ended December 31, 2017, 2016 and 2015. |
Revenue recognition | Revenue recognition Work Truck Attachments Segment Revenue Recognition The Company recognizes revenues upon shipment of equipment to the customer, which is when risk of loss passes and all of the following conditions are satisfied: (i) persuasive evidence of an arrangement exists; (ii) the price is fixed or determinable; (iii) collectability is reasonably assured; and (iv) the product has been shipped and the Company has no further obligations. Customers have no right of return privileges. Historically, product returns have not been material and are permitted on an exception basis only. Revenues from the sales of the Work Truck Attachments segment equipment are generally recognized on a gross basis. Additionally, within the Work Truck Attachments segment, the Company performs upfitting services. Upfitting services are recognized as revenue when risk of loss passes and all of the following conditions are satisfied: (i) persuasive evidence of an arrangement exists; (ii) the price is fixed or determinable; (iii) collectability is reasonably assured; and (iv) the product has been either delivered or picked up by the customer and the Company has no further obligations. Customers have no right of return privileges. Historically, product returns have not been material and are permitted on an exception basis only. Additionally, customers are billed separately for the truck chassis by the chassis manufacturer. The Company only records sales for the net amount of the upfit, excluding the truck chassis. The company acts as a garage keeper and never takes ownership or title to the truck chassis and does not pay interest associated with the truck chassis on its premises within the Work Truck Attachments segment. Within the Work Truck Attachments segment, the Company offers a variety of discounts and sales incentives to its distributors. The estimated liability for sales discounts and allowances is recorded at the time of sale as a reduction of net sales. The liability is estimated based on the costs of the program, the planned duration of the program and historical experience. Work Truck Solutions Segment Revenue Recognition Within the Work Truck Solutions segment, the Company performs upfitting services. Upfitting services are recognized as revenue when risk of loss passes and all of the following conditions are satisfied: (i) persuasive evidence of an arrangement exists; (ii) the price is fixed or determinable; (iii) collectability is reasonably assured; and (iv) the product has been either delivered or picked up by the customer and the Company has no further obligations. Customers have no right of return privileges. Historically, product returns have not been material and are permitted on an exception basis only. Additionally, customers are billed separately for the truck chassis by the chassis manufacturer. The Company only records sales for the net amount of the upfit, excluding the truck chassis. The Company obtains the truck chassis from the truck chassis manufacturer through either its floor plan agreement with a financial institution or bailment pool agreement with the truck chassis manufacturer. For truck chassis acquired through the floor plan agreement, the Company holds title to the vehicle from the time the chassis is received by the Company until the completion of the upfit. Conversely, under the bailment pool agreement, the Company does not take title to the truck chassis, but rather only holds the truck chassis on consignment. The Company pays interest on both of these arrangements as discussed below in Note 7. The Company records revenue in the same manner net of the value of the truck chassis in both the Company’s floor plan and bailment pool agreements. Revenues from the sales of the Work Truck Solutions products are generally recognized net of the truck chassis with the selling price to the customer recorded as sales and the manufacturing and upfit cost of the product recorded as cost of sales. The Company also sells certain products within the Work Truck Solutions segment for which it acts as an agent. Products in this category include the sale of third-party products. These sales do not meet the criteria for gross sales recognition, and thus are recognized on a net basis at the time of sale. Under net sales recognition, the cost paid to the third-party service provider is recorded as a reduction to sales, resulting in net sales being equal to the gross profit on the transaction. |
Cost of sales | Cost of sales Cost of sales includes all costs associated with the manufacture of the Company’s products, including raw materials, purchased parts, freight, plant operating expenses, property insurance and taxes, and plant depreciation. All payroll costs and employee benefits for the hourly workforce, manufacturing management, and engineering costs are included in cost of sales. |
Related Party Transactions | Related party transactions As a result of the Dejana acquisition, the Company entered into related party leases. See Note 14 for further details. During 2016, one of the Company’s non-employee directors, served as the Chief Executive Officer of Fleetpride, Inc., an independent distributor of parts for heavy duty trucks and trailers. During 2016, the Company purchased parts from Fleetpride, Inc. for use in Henderson Products, Inc. trucks. The total amount of these purchases during 2016 was $242. There were no related party purchases during 2017. |
Warranty cost recognition | Warranty cost recognition The Company accrues for estimated warranty costs as revenue is recognized. See Note 9 for further details. |
Defined benefit plans | Defined benefit plans The Company has noncontributory, defined benefit retirement plans and postretirement benefit plans covering certain employees. Management reviews underlying assumptions on an annual basis. Refer to Note 11. |
Advertising expenses | Advertising expenses Advertising expenses include costs for the production of marketing media, literature, CD‑ROM, and displays. The Company participates in trade shows and advertises in the yellow pages and billboards. Advertising expenses amounted to $4,471, $4,269 and $4,511 for the years ended December 31, 2017, 2016 and 2015, respectively. The Company also provides its distributors with pre‑approved, cooperative advertising programs, which are recorded as advertising expense in selling, general and administrative expense. All costs associated with the Company’s advertising programs are expensed as incurred. Research and development expenses Research and development expenses include costs to develop new technologies to enhance existing products and to expand the range of product offerings. Research and development expenses amounted to $2,926, $3,132 and $2,950 for the years ended December 31, 2017, 2016 and 2015, respectively. |
Shipping and handling costs | Shipping and handling costs Generally, shipping and handling costs are paid directly by the customer to the shipping agent. Those shipping and handling costs billed by the Company are recorded as a component of sales with the corresponding costs included in cost of sales. |
Share-based payments | Share‑based payments The Company applies the guidance codified in ASC 718, Compensation—Stock Compensation. This standard requires the measurement of the cost of employee services received in exchange for an award of equity instruments based on the fair value of the award at the grant date and recognition of the compensation expense over the period during which an employee is required to provide service in exchange for the award (generally the vesting period). |
Comprehensive income (loss) | Comprehensive loss Comprehensive loss is defined as the change in equity (net assets) of a business enterprise during a period from transactions and other events and circumstances from non‑owner resources and is comprised of net income or loss and “other comprehensive loss”. The Company’s other comprehensive loss is comprised of the adjustments for pension and postretirement benefit liabilities as well as the impact of its interest rate swaps. See Note 18 for the components of accumulated other comprehensive loss. |
Segment Reporting | Segment Reporting As a result of the Dejana acquisition which closed on July 15, 2016, 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, 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 the Company’s operations that, prior to the Company’s acquisition of Dejana, were a 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 upfit 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, gross margin and operating income. Items not allocated to segment operating income include corporate administrative expenses and certain other amounts that include various support functions, such as information technology, corporate finance, legal, executive administration and human resources. No single customer’s revenues amounted to 10% or more of the Company’s total revenue . Sales are primarily within the United States and substantially all assets are located within the United States. |
Summary of Significant Accoun32
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Schedule of estimated useful lives of the assets | Years Land improvements and buildings - 40 Leasehold improvements Machinery and equipment - 20 Furniture and fixtures - 12 Mobile equipment and other - 10 |
Schedule of changes in deferred financing costs | Balance at December 31, 2014 $ 2,485 Amortization of deferred financing costs (148) Balance at December 31, 2015 Deferred financing costs capitalized on new debt Amortization of deferred financing costs (624) Balance at December 31, 2016 Amortization of deferred financing costs Balance at December 31, 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 December 31, 2017 Fair Value at December 31, 2016 Assets: Other long-term assets (a) $ 4,840 $ 3,458 Total Assets $ 4,840 $ 3,458 Liabilities: Interest rate swaps (b) 2,178 1,985 Long term debt (c) 312,384 315,940 Earnout - Henderson (d) 529 636 Earnout - Dejana (e) 3,100 10,373 Total Liabilities $ 318,191 $ 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 amounts of these insurance policies approximates their fair value. (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 $597 and $1,581 at December 31, 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 financing 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 $87 and $442, respectively, at December 31, 2017 is the fair value of an obligation for a portion of the potential earn out acquired in conjunction with the acquisition of Henderson. Included in accrued expenses and other current liabilities and other long term liabilities in the amounts of $194 and $442, respectively, at December 31, 2016 is the fair value of an obligation for a portion of the potential earn out 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: December 31, 2017 2016 Beginning Balance $ 636 $ 761 Payment to former owners (107) (125) Ending balance $ 529 $ 636 (e) Included in Other long term liabilities in the amount of $3,100 at December 31, 2017 is the fair value of an obligation for a portion of the potential earn out 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 $5,487 and $4,886, respectively, at December 31, 2016 is the fair value of an obligation for a portion of the potential earn out incurred in conjunction with the acquisition of Dejana. The carrying amount of the earn out approximates its fair value. 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: December 31, 2017 2016 Beginning Balance $ 10,373 $ - Additions - 10,200 Adjustments to fair value (1,786) 173 Payment to former owners (5,487) - Ending balance $ 3,100 $ 10,373 |
Trynex | |
Schedule of reconciliation of liability | December 31, 2017 2016 Beginning Balance $ - $ 1,606 Additions - - Adjustments to fair value - - Payments to former owners - (1,606) Ending balance $ - $ - |
Henderson | |
Schedule of reconciliation of liability | December 31, 2017 2016 Beginning Balance $ 636 $ 761 Payment to former owners (107) (125) Ending balance $ 529 $ 636 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Dejana | |
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 liabilities (3,881) Floor plan obligations (13,479) Earn out liability (10,200) Total $ |
Unaudited proforma information | Years ended December 31, 2016 2015 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 liabilities (957) Unfavorable lease (107) Total $ |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Inventories | |
Schedule of inventories | December 31, 2017 2016 Finished goods $ $ Work-in-process Raw material and supplies $ $ |
Property, plant and equipment (
Property, plant and equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, plant and equipment | |
Summary of property, plant and equipment | December 31, 2017 2016 Land $ $ Land improvements Leasehold improvements Buildings Machinery and equipment Furniture and fixtures Mobile equipment and other Construction-in-process Total property, plant and equipment Less accumulated depreciation Net property, plant and equipment $ $ |
Other Intangible Assets (Tables
Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Other Intangible Assets | |
Summary of other intangible assets | Gross Less Net Carrying Accumulated Carrying Amount Amortization Amount December 31, 2017 Indefinite-lived intangibles: Trademark and tradenames $ $ - $ Amortizable intangibles: Dealer network Customer relationships Patents Noncompete agreements Trademarks Backlog 1,900 - License - Amortizable intangibles, net Total $ $ $ Gross Less Net Carrying Accumulated Carrying Amount Amortization Amount December 31, 2016 Indefinite-lived intangibles: Trademark and tradenames $ $ - $ Amortizable intangibles: Dealer network Customer relationships Patents Noncompete agreements Trademarks Backlog 1,900 - License - Amortizable intangibles, net Total $ $ $ |
Schedule of estimated amortization expense | 2018 $ 2019 2020 2021 2022 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Long-Term Debt | |
Summary of long-term debt | December 31, 2017 2016 Term Loan, net of debt discount of $1,562 and $1,953 at December 31, 2017 and December 31, 2016, respectively $ $ Less current maturities Long term debt before deferred financing costs Deferred financing costs, net 4,033 Long term debt, net $ $ |
Schedule of maturities on long-term debt | The scheduled maturities on long term debt at December 31, 2017, are as follows: 2018 $ 32,749 2019 2,749 2020 2,749 2021 272,583 $ |
Accrued Expenses and Other Cu38
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Expenses and Other Current Liabilities | |
Summary of accrued expenses and other current liabilities | December 31, 2017 2016 Payroll and related costs $ $ Employee benefits Accrued warranty Earnout - Dejana - Other $ $ |
Warranty Liability (Tables)
Warranty Liability (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Warranty Liability | |
Schedule of rollforward of Company's warranty liability | December 31, 2017 2016 2015 Balance at the beginning of the period $ $ $ Establish warranty liability for Dejana - 35 - Establish warranty liability for Arrowhead 65 - - Warranty provision 2,506 2,452 4,931 Claims paid/settlements Balance at the end of the period $ $ $ |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Taxes | |
Schedule of components of provision for income tax expense (benefit) | Year ended December 31 2017 2016 2015 Current: Federal $ 11,897 $ 16,664 $ 15,298 State 988 1,866 2,057 12,885 18,530 17,355 Deferred: Federal (17,264) State 1,970 1,227 (1,371) $ $ $ |
Schedule of reconciliation of income tax expense computed at the federal statutory rate to the provision for income taxes | 2017 2016 2015 Federal income tax expense at statutory rate $ 18,520 $ 22,294 $ 23,192 State taxes, net of federal benefit 1,539 2,547 1,077 Valuation allowance changes - (7) (1,028) Change in uncertain tax positions, net 1,043 50 43 Research and development credit (160) (274) (241) State rate change 240 64 (30) Manufacturing tax benefits (933) (1,248) (1,302) Prior period adjustments - 1,096 - Federal deferred rate change (22,452) - - Other (206) 165 376 $ $ $ |
Schedule of significant components of deferred tax liabilities and assets | December 31, 2017 2016 Deferred tax assets: Allowance for doubtful accounts $ 259 $ 393 Inventory reserves 967 1,111 Warranty liability 1,421 2,244 Deferred compensation 781 548 Earnout liabilities 694 242 Pension and retiree health benefit obligations 3,242 5,432 Accrued vacation 656 866 Medical claims reserve 189 72 State net operating losses 3,386 2,853 Other accrued liabilities 2,092 2,967 Valuation allowance for state net operating losses (777) (640) Total deferred tax assets Deferred tax liabilities: Tax deductible goodwill and other intangibles (47,163) (63,324) Accelerated depreciation (5,084) (7,176) Other 68 (151) Total deferred tax liabilities (52,179) (70,651) Net deferred tax liabilities $ (39,269) $ (54,563) |
Schedule of reconciliation of the beginning and ending liability for uncertain tax positions | 2017 2016 2015 Balance at beginning of year $ $ $ Increases for tax positions taken in the current year Increases for tax positions taken in the prior years - Decreases due to settlements with taxing authorities (8) (11) - Decreases due to lapses in the statute of limitations (521) - - Balance at the end of year $ 3,531 $ 2,361 $ 490 |
Employee Retirement Plans (Tabl
Employee Retirement Plans (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Pension plan | |
Employee retirement plans | |
Schedule of reconciliation of the beginning and ending balances of the projected benefit obligation, fair value of plan assets, funded status of plans, and amounts recognized in the consolidated balance sheets. | December 31 2017 2016 Benefit obligation at beginning of year $ 39,407 $ 37,217 Service cost 356 321 Interest cost 1,613 1,639 Actuarial loss 3,571 1,469 Benefits paid (1,283) (1,239) Benefit obligation at end of year 43,664 39,407 Fair value of plan assets at beginning of year 29,223 26,378 Actual return on plan assets 4,294 2,373 Employer contributions through December 31 1,669 1,711 Benefits paid (1,283) (1,239) Fair value of plan assets at end of year 33,903 29,223 $ (9,761) $ (10,184) |
Schedule of components of net periodic pension or other postretirement benefit cost | 2017 2016 2015 Components of net periodic pension cost: Service cost $ $ $ Interest cost 1,613 1,639 1,489 Expected return on plan assets Amortization of net loss 723 724 1,021 Net periodic pension cost $ 902 $ 860 $ 1,137 |
Schedule of assumptions used in determining net periodic costs and summary of healthcare cost trend rates | Year ended December 31 2017 2016 2015 Discount rates % 4.5 % 3.9% - 4.0 % Rates of increase in compensation levels: Salaried Hourly N/A N/A N/A Expected long-term rate of return on assets |
Schedule of expected benefit payments | 2018 $ 2019 2020 2021 2022 2023-2027 |
Schedule of weighted-average asset allocation and actual allocation for the qualified pension plans by asset category | Target 2017 2016 Large Cap Equity % $ % $ % Mid Cap Equity % % % Small Cap Equity % % % International Equity % % % Emerging Markets Equity % 128 % 88 % Fixed Income and Cash Equivalents % % % Real Estate % 382 % 333 % Total % $ % $ % |
Schedule of fair values of the Company's pension plan assets | The fair values of the Company’s pension plan assets as of December 31, 2017 are as follows: Balance as of December 31, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Equity holdings $ $ — $ $ — Fixed-income holdings — — Alternative investments 2,026 — — 2,026 Total pension plan assets $ $ — $ $ The fair values of the Company’s pension plan assets as of December 31, 2016 are as follows: Balance as of December 31, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Equity holdings $ $ — $ $ — Fixed-income holdings — — Alternative investments 1,748 — — 1,748 Total pension plan assets $ $ — $ $ |
Schedule of reconciliation of the fair value measurements using significant unobservable inputs (Level 3) | December 31, 2017 2016 Balance, beginning of year $ 1,748 $ 1,364 Deposits 101 Actual return on plan assets held at reporting date 138 Withdrawals 145 Balance, end of year $ 2,026 $ 1,748 |
Salaried Pension Plan | |
Employee retirement plans | |
Schedule of weighted-average asset allocation and actual allocation for the qualified pension plans by asset category | Target 2017 2016 Large Cap Equity % $ % $ % Mid Cap Equity % % % Small Cap Equity % % % International Equity % % % Emerging Markets Equity % 348 % 374 % Fixed Income and Cash Equivalents % % % Real Estate % 1,644 % 1,415 % Total % $ % $ % |
Other postretirement benefit cost | |
Employee retirement plans | |
Schedule of reconciliation of the beginning and ending balances of the projected benefit obligation, fair value of plan assets, funded status of plans, and amounts recognized in the consolidated balance sheets. | December 31 2017 2016 Change in projected benefit obligation: Benefit obligation at beginning of year $ $ Service cost Interest cost Participant contributions Changes in actuarial assumptions (853) 53 Benefits paid (39) (142) Projected benefit obligation at end of year $ $ Amounts recognized in the consolidated balance sheets consisted of: Accrued expenses and other current liabilities $ $ Retiree health benefit obligation $ 6,949 $ 7,333 |
Schedule of components of net periodic pension or other postretirement benefit cost | 2017 2016 2015 Components of net postretirement health benefit cost: Service cost $ $ $ 229 Interest cost 278 256 Amortization of net gain (107) (127) (69) Net postretirement healthcare benefit cost (income) $ 376 $ 361 $ 416 |
Schedule of assumptions used in determining net periodic costs and summary of healthcare cost trend rates | Year Ended December 31 2017 2016 2015 Discount rate % % % Immediate healthcare cost trend rate * ** *** Ultimate healthcare cost trend rate Assumed annual reduction in trend rate * ** *** Participation * ** *** |
Schedule of effect of one percentage point change in the healthcare cost trend rate | 1% 1% Increase Decrease Effect on total service and interest cost $ 54 $ (46) Effect on postretirement benefit obligation (669) |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Stock Based Compensation | |
Summary of restricted stock activity | Weighted Weighted Average Average Grant Remaining Date Contractual Shares Fair value Term Unvested at December 31, 2014 85,021 years Granted — — — years Vested (70,320) Cancelled and forfeited — — Unvested at December 31, 2015 14,701 years Granted — — — Vested (14,701) 14.78 Cancelled and forfeited — — Unvested at December 31, 2016 - - - years |
Summary of RSU activity | Weighted Weighted Average Average Grant Remaining Date Contractual Shares Fair value Term Unvested at December 31, 2014 81,623 years Granted 116,141 years Vested (147,217) Cancelled and forfeited (1,882) Unvested at December 31, 2015 years Granted 131,765 years Vested (132,640) 20.27 Cancelled and forfeited — — Unvested at December 31, 2016 years Granted 128,893 24.31 years Vested (128,697) 22.93 Cancelled and forfeited (444) Unvested at December 31, 2017 $ years Expected to vest in the future at December 31, 2017 $ years |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share | |
Schedule of computation of basic and diluted earnings (loss) per share | 2017 2016 2015 Basic earnings per common share Net income $ 55,324 $ 39,009 $ 44,176 Less income allocated to participating securities 715 540 604 Net income allocated to common shareholders $ 54,609 $ 38,469 $ 43,572 Weighted average common shares outstanding 22,576,381 22,480,679 22,329,044 $ 2.42 $ 1.71 $ 1.95 Earnings per common share assuming dilution Net income $ 55,324 $ 39,009 $ 44,176 Less income allocated to participating securities 715 540 604 Net income allocated to common shareholders $ 54,609 $ 38,469 $ 43,572 Weighted average common shares outstanding 22,576,381 22,480,679 22,329,044 Incremental shares applicable to stock based compensation 11,267 - 12,731 Weighted average common shares assuming dilution 22,587,648 22,480,679 22,341,775 $ 2.40 $ 1.70 $ 1.94 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies | |
Future minimum lease payments | The Company leases facilities under non-cancelable operating leases, some of which contain renewal options. Total future minimum lease payments consisted of the following at December 31, 2017 : Related Party Leases Third Party Leases Total Leases 2018 $ $ $ 2019 2020 2021 2022 Thereafter Total lease obligations $ 15,788 $ 6,132 $ 21,920 |
Segments (Table)
Segments (Table) | 12 Months Ended |
Dec. 31, 2017 | |
Segments | |
Schedule of assets and profit/loss of the segments | 2017 2016 2015 Net sales Work Truck Attachments $ $ $ Work Truck Solutions - Corporate & Eliminations (13,407) (9,414) 501 $ $ $ Selling, general, and administrative expense Work Truck Attachments $ $ $ Work Truck Solutions - Corporate & Eliminations $ $ $ Income (loss) from operations Work Truck Attachments $ $ $ Work Truck Solutions 9,825 3,077 - Corporate & Eliminations (17,822) (19,847) (16,138) $ $ $ 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 - - $ $ $ |
Valuation and qualifying acco46
Valuation and qualifying accounts (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Valuation and qualifying accounts | |
Schedule of valuation and qualifying accounts | Balance at Additions Changes to Balance at beginning charged to reserve, net(1) end of year of year earnings Year ended December 31, 2017 Allowance for doubtful accounts $ 1,158 $ 1,475 $ (1,577) $ 1,056 Valuation of deferred tax assets 640 - 137 777 Year ended December 31, 2016 Allowance for doubtful accounts $ 1,343 $ 208 $ (393) $ 1,158 Valuation of deferred tax assets - (7) 640 Year ended December 31, 2015 Allowance for doubtful accounts $ 1,667 $ 305 $ (629) $ 1,343 Valuation of deferred tax assets - (953) 647 (1) Increases (deductions) from the allowance for doubtful accounts equal accounts receivable written off and increases related to acquired businesses, less recoveries, against the allowance. Increases (deductions) to the valuation of deferred tax assets relate to the reversals due to changes in management’s judgments regarding the future realization of the underlying deferred tax assets. |
Changes in Accumulated Other 47
Changes in Accumulated Other Comprehensive Loss by Component (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Changes in Accumulated Other Comprehensive Loss by Component | |
Schedule of changes to accumulated other comprehensive loss by component | 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 (338) 521 (670) (487) Amounts reclassified from accumulated other comprehensive loss: (1) 205 (66) 448 587 Balance at December 31, 2017 $ (1,328) $ 1,392 $ (6,636) $ (6,572) (1) Amounts reclassified from accumulated other comprehensive loss: Amortization of Other Postretirement Benefit items: Actuarial gains (a) (107) Tax expense 41 Reclassification net of tax $ (66) Amortization of pension obligation: Actuarial losses (a) 723 Tax benefit (275) Reclassification net of tax $ 448 Unrealized losses on interest rate swaps reclassified to interest expense 330 Tax benefit (125) Reclassification net of tax $ 205 (a) – These components are included in the computation of benefit plan costs in Note 11. Changes to accumulated other comprehensive loss by component for the year ended December 31, 2016 is 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 gain (loss) before reclassifications (500) (32) (569) (1,101) Amounts reclassified from accumulated other comprehensive loss: (1) 242 (79) 449 612 Balance at December 31, 2016 $ (1,195) $ 937 $ (6,414) $ (6,672) (1) Amounts reclassified from accumulated other comprehensive loss: Amortization of Other Postretirement Benefit items: Actuarial gain (a) (127) Tax expense 48 Reclassification net of tax $ (79) Amortization of pension obligation: Actuarial losses (a) 724 Tax benefit (275) Reclassification net of tax $ 449 Unrealized losses on interest rate swaps reclassified to interest expense 390 Tax benefit (148) Reclassification net of tax $ 242 (a) – These components are included in the computation of benefit plan costs in Note 11. |
Quarterly Financial Informati48
Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information (unaudited) | |
Schedule of quarterly financial information (unaudited) | 2017 First Second Third Fourth Net sales $ 72,248 $ 139,371 $ 125,339 $ 137,969 Gross profit $ 17,187 $ 45,033 $ 36,055 $ 44,811 Income (loss) before taxes $ (5,971) $ 22,354 $ 15,081 $ 21,451 Net income (loss) $ (3,277) $ 14,746 $ 9,327 $ 34,528 Basic net earnings (loss) per common share attributable to common shareholders $ (0.14) $ 0.64 $ 0.41 $ 1.51 Earnings (loss) per common share assuming dilution attributable to common shareholders $ (0.14) $ 0.64 $ 0.40 $ 1.50 Dividends per share $ 0.24 $ 0.24 $ 0.24 $ 0.24 Results for the year ended December 31, 2016 include Dejana which was purchased on July 15, 2016. Additionally, the first quarter of 2016 includes the impact of litigation proceeds of $10,050. 2016 First Second Third Fourth Net sales $ 48,789 $ 113,763 $ 123,573 $ 130,143 Gross profit $ 14,131 $ 41,521 $ 36,644 $ 41,678 Income before taxes $ 8,606 $ 25,551 $ 11,873 $ 17,666 Net income $ 5,278 $ 16,328 $ 7,302 $ 10,101 Basic net earnings per common share attributable to common shareholders $ 0.23 $ 0.72 $ 0.32 $ 0.44 Earnings per common share assuming dilution attributable to common shareholders $ 0.23 $ 0.71 $ 0.32 $ 0.44 Dividends per share $ 0.24 $ 0.24 $ 0.24 $ 0.24 |
Basis of presentation (Details)
Basis of presentation (Details) $ in Thousands | Jul. 15, 2016segment | Mar. 31, 2016USD ($) | Sep. 30, 2016segment | Dec. 31, 2017USD ($)segment | Dec. 31, 2016USD ($) |
Interim Consolidated Financial Information | |||||
Number of operating segments | segment | 2 | 1 | 2 | ||
Deferred income taxes | $ 39,269 | $ 54,563 | |||
Litigation proceeds | $ 10,050 | 1,275 | $ 10,050 | ||
Accounting Standards Update 2015-17 [Member] | |||||
Interim Consolidated Financial Information | |||||
Deferred income taxes | $ 5,726 | ||||
Interest Rate Swap Effective 31 December 2015 through 29 March 2018 | |||||
Interim Consolidated Financial Information | |||||
Fixed interest rate (as a percent) | 6.916% | ||||
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) | 3.00% | ||||
LIBOR floor (as a percent) | 1.00% | ||||
Interest Rate Swap Effective 29 March 2018 through 31 March 2020 | |||||
Interim Consolidated Financial Information | |||||
Fixed interest rate (as a percent) | 6.105% | ||||
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) | 3.00% | ||||
LIBOR floor (as a percent) | 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% | ||||
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) | 3.00% | ||||
LIBOR floor (as a percent) | 1.00% |
Summary of Significant Accoun50
Summary of Significant Accounting Policies - Derivatives (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017USD ($)company | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Financing program | |||
Purchases of distributors financed | $ 7,115 | $ 7,578 | $ 7,584 |
Amount owed by distributors to third party financing company | 3,436 | 6,767 | |
Repossessed inventory required to be repurchased | 0 | 0 | $ 13 |
Inventories | |||
Truck Floor Plan Inventories, Net | 7,711 | 3,939 | |
Inventories - bailment pool chasis | $ 17,447 | 22,420 | |
Leases | |||
Number of companies | company | 15 | ||
Maximum | |||
Cash and Cash Equivalents | |||
Maturity period | 3 months | ||
Interest rate swap | |||
Interest Rate Swap | |||
Derivative Liability | $ (1,328) | $ (1,195) | |
Interest Rate Swap Effective 29 March 2018 through 31 March 2020 | |||
Interest Rate Swap | |||
Derivative, Fixed Interest Rate | 6.105% | ||
Notional amount | $ 45,000 | ||
Interest Rate Swap Effective 29 March 2018 through 31 March 2020 | London Interbank Offered Rate (LIBOR) | |||
Interest Rate Swap | |||
Derivative, Basis Spread on Variable Rate | 3.00% | ||
Derivative, Floor Interest Rate | 1.00% | ||
Interest Rate Swap Effective 31 December 2015 through 29 March 2018 | |||
Interest Rate Swap | |||
Derivative, Fixed Interest Rate | 6.916% | ||
Notional amount | $ 90,000 | ||
Interest Rate Swap Effective 31 December 2015 through 29 March 2018 | London Interbank Offered Rate (LIBOR) | |||
Interest Rate Swap | |||
Derivative, Basis Spread on Variable Rate | 3.00% | ||
Derivative, Floor Interest Rate | 1.00% | ||
Interest Rate Swap Effective 31 March 2020 through 30 June 2021 | |||
Interest Rate Swap | |||
Derivative, Fixed Interest Rate | 7.168% | ||
Notional amount | $ 135,000 | ||
Interest Rate Swap Effective 31 March 2020 through 30 June 2021 | London Interbank Offered Rate (LIBOR) | |||
Interest Rate Swap | |||
Derivative, Basis Spread on Variable Rate | 3.00% | ||
Derivative, Floor Interest Rate | 1.00% |
Summary of Significant Accoun51
Summary of Significant Accounting Policies - PPE (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, plant and equipment | |||
Depreciation expense | $ 7,183 | $ 6,146 | $ 4,919 |
Repairs and maintenance expenses | $ 5,222 | $ 5,060 | $ 5,272 |
Land improvements and buildings | Minimum | |||
Property, plant and equipment | |||
Estimated useful lives | 15 years | ||
Land improvements and buildings | Maximum | |||
Property, plant and equipment | |||
Estimated useful lives | 40 years | ||
Leasehold Improvements | Minimum | |||
Property, plant and equipment | |||
Estimated useful lives | 12 years | ||
Machinery and equipment | Minimum | |||
Property, plant and equipment | |||
Estimated useful lives | 3 years | ||
Machinery and equipment | Maximum | |||
Property, plant and equipment | |||
Estimated useful lives | 20 years | ||
Furniture and fixtures | Minimum | |||
Property, plant and equipment | |||
Estimated useful lives | 3 years | ||
Furniture and fixtures | Maximum | |||
Property, plant and equipment | |||
Estimated useful lives | 12 years | ||
Mobile equipment and other | Minimum | |||
Property, plant and equipment | |||
Estimated useful lives | 3 years | ||
Mobile equipment and other | Maximum | |||
Property, plant and equipment | |||
Estimated useful lives | 10 years |
Summary of Significant Accoun52
Summary of Significant Accounting Policies - Impairment and Intangibles (Details) | 12 Months Ended | |||
Dec. 31, 2017USD ($)item | Dec. 31, 2016USD ($) | Dec. 31, 2015 | May 01, 2017USD ($) | |
Goodwill and other intangible assets | ||||
Number of Reporting Units | item | 3 | |||
Goodwill | $ 241,006,000 | $ 238,286,000 | $ 2,720,000 | |
Goodwill impairment | 0 | 0 | ||
Finite-lived intangible asset impairment | 0 | 0 | ||
Impairment of long-lived assets | 0 | 0 | ||
Intangible assets | 275,675,000 | 272,975,000 | ||
Gross intangible assets | 198,075,000 | 195,375,000 | ||
Accumulated amortization | 89,525,000 | 78,124,000 | ||
Distribution network | ||||
Goodwill and other intangible assets | ||||
Gross intangible assets | 80,000,000 | 80,000,000 | ||
Accumulated amortization | $ 55,000,000 | 51,000,000 | ||
Distribution network | Minimum | ||||
Goodwill and other intangible assets | ||||
Amortization period | 15 years | |||
Distribution network | Maximum | ||||
Goodwill and other intangible assets | ||||
Amortization period | 20 years | |||
Trademark | ||||
Goodwill and other intangible assets | ||||
Gross intangible assets | $ 5,459,000 | 5,459,000 | ||
Accumulated amortization | $ 3,525,000 | 3,431,000 | ||
Trademark | Minimum | ||||
Goodwill and other intangible assets | ||||
Amortization period | 7 years | |||
Trademark | Maximum | ||||
Goodwill and other intangible assets | ||||
Amortization period | 25 years | |||
Patents | ||||
Goodwill and other intangible assets | ||||
Gross intangible assets | $ 21,136,000 | 21,136,000 | ||
Accumulated amortization | $ 10,721,000 | 9,466,000 | ||
Patents | Minimum | ||||
Goodwill and other intangible assets | ||||
Amortization period | 7 years | |||
Patents | Maximum | ||||
Goodwill and other intangible assets | ||||
Amortization period | 20 years | |||
Customer relations | ||||
Goodwill and other intangible assets | ||||
Amortization period | 15 years | |||
Gross intangible assets | $ 80,920,000 | 78,220,000 | ||
Accumulated amortization | $ 11,304,000 | 6,075,000 | ||
Customer relations | Minimum | ||||
Goodwill and other intangible assets | ||||
Amortization period | 15 years | |||
Customer relations | Maximum | ||||
Goodwill and other intangible assets | ||||
Amortization period | 19 years 6 months | |||
Noncompete agreements | ||||
Goodwill and other intangible assets | ||||
Amortization period | 4 years | |||
Gross intangible assets | $ 8,640,000 | 8,640,000 | ||
Accumulated amortization | $ 7,055,000 | 6,232,000 | ||
Noncompete agreements | Minimum | ||||
Goodwill and other intangible assets | ||||
Amortization period | 4 years | |||
Noncompete agreements | Maximum | ||||
Goodwill and other intangible assets | ||||
Amortization period | 5 years | |||
Work Truck Attachments segment | ||||
Goodwill and other intangible assets | ||||
Goodwill | $ 160,932,000 | 160,932,000 | ||
Gross intangible assets | 195,175,000 | 195,175,000 | ||
Accumulated amortization | 81,336,000 | 74,432,000 | ||
Work Truck Solutions segment | ||||
Goodwill and other intangible assets | ||||
Goodwill | 80,074,000 | 77,354,000 | ||
Gross intangible assets | 80,500,000 | 77,800,000 | ||
Accumulated amortization | $ 8,189,000 | $ 3,692,000 |
Summary of Significant Accoun53
Summary of Significant Accounting Policies - Deferred Financing (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Changes in deferred financing costs | |||
Balance at the beginning of the period | $ 4,033 | $ 2,337 | $ 2,485 |
Deferred financing costs capitalized on new debt | 2,320 | ||
Amortization of deferred financing costs | (824) | (624) | (148) |
Balance at the end of the period | $ 3,209 | $ 4,033 | $ 2,337 |
Summary of Significant Accoun54
Summary of Significant Accounting Policies - Fair Value (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jul. 15, 2016 | |
Assets: | ||||||
Other assets | $ 4,840 | $ 4,840 | $ 3,458 | |||
Total Assets | 4,840 | 4,840 | 3,458 | |||
Liabilities: | ||||||
Long term debt | 312,384 | 312,384 | 315,940 | |||
Interest rate swaps | 2,178 | 2,178 | 1,985 | |||
Total Liabilities | 318,191 | 318,191 | 328,934 | |||
Reconciliation of liability related to earnout | ||||||
Balance at the beginning of the period | 10,373 | |||||
Additions | 10,200 | |||||
Adjustments to fair value | (600) | $ (1,186) | (1,786) | 173 | ||
Balance at the end of the period | 10,373 | |||||
Advertising expenses | ||||||
Advertising expenses incurred | 4,471 | 4,269 | $ 4,511 | |||
Research and development expenses | ||||||
Research and development expenses | 2,926 | 3,132 | 2,950 | |||
Henderson | ||||||
Liabilities: | ||||||
Earnout | 529 | 529 | 636 | |||
Dejana | ||||||
Liabilities: | ||||||
Earnout | 3,100 | 3,100 | 10,373 | $ 10,200 | ||
Level 3 | Henderson | ||||||
Liabilities: | ||||||
Earnout, portion in other current liabilities | 87 | 87 | 194 | |||
Earnout, portion in other long term liabilities | 442 | 442 | 442 | |||
Level 3 | Dejana | ||||||
Liabilities: | ||||||
Earnout, portion in other current liabilities | 5,487 | |||||
Earnout, portion in other long term liabilities | 4,886 | |||||
Recurring | Level 2 | ||||||
Reconciliation of liability related to earnout | ||||||
Derivative Liability, Current | 597 | 597 | 335 | |||
Derivative Asset, Noncurrent | 1,581 | 1,581 | ||||
Derivative Liability, Noncurrent | 1,650 | |||||
Recurring | Level 3 | Henderson | ||||||
Reconciliation of liability related to earnout | ||||||
Balance at the beginning of the period | 636 | 761 | ||||
Payments to former owners | (107) | (125) | ||||
Balance at the end of the period | 529 | 529 | 636 | $ 761 | ||
Recurring | Level 3 | Dejana | ||||||
Reconciliation of liability related to earnout | ||||||
Balance at the beginning of the period | 10,373 | |||||
Adjustments to fair value | (1,786) | |||||
Payments to former owners | (5,487) | |||||
Balance at the end of the period | $ 3,100 | $ 3,100 | 10,373 | |||
Fleet Pride Inc, | ||||||
Related Party Transactions | ||||||
Related Party Transaction, Purchases from Related Party | $ 242 |
Summary of Significant Accoun55
Summary of Significant Accounting Policies - Segments (Details) $ in Thousands | Jul. 15, 2016segment | Dec. 31, 2017USD ($)item | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($)item | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Sep. 30, 2016segment | Dec. 31, 2017USD ($)segmentitem | Dec. 31, 2016USD ($)item | Dec. 31, 2015USD ($)item |
Product offerings | |||||||||||||
Number of distributors with more than 10% of company's net sales | item | 0 | 0 | 0 | 0 | 0 | ||||||||
Segment Reporting | |||||||||||||
Number of operating segments | 2 | 1 | 2 | ||||||||||
Number of Reportable Segments | 1 | 2 | |||||||||||
Net sales | $ | $ 137,969 | $ 125,339 | $ 139,371 | $ 72,248 | $ 130,143 | $ 123,573 | $ 113,763 | $ 48,789 | $ 474,927 | $ 416,268 | $ 400,408 |
Acquisitions - Allocation of Pu
Acquisitions - Allocation of Purchase Price (Details) - USD ($) $ / shares in Units, $ in Thousands | May 01, 2017 | Jul. 15, 2016 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Acquisition | |||||||||||||||
Working capital adjustment | $ 5,417 | ||||||||||||||
Payable to former shareholder | $ 5,487 | ||||||||||||||
Earnout liability | (1,786) | $ (1,128) | $ 623 | ||||||||||||
Allocation of the purchase price paid to the fair value of the net assets for acquisition | |||||||||||||||
Accounts receivable | $ 852 | ||||||||||||||
Inventories | 1,547 | ||||||||||||||
Prepaid and other current assets | 6 | ||||||||||||||
Property and equipment | 624 | ||||||||||||||
Goodwill | 2,720 | $ 241,006 | $ 238,286 | 238,286 | 241,006 | 238,286 | |||||||||
Intangible assets | 2,700 | ||||||||||||||
Accounts payable and other current liabilities | (957) | ||||||||||||||
Unfavorable lease | (107) | ||||||||||||||
Total | 7,385 | ||||||||||||||
Revenues | 137,969 | $ 125,339 | $ 139,371 | $ 72,248 | 130,143 | $ 123,573 | $ 113,763 | $ 48,789 | 474,927 | 416,268 | 400,408 | ||||
Pre-tax operating losses | 21,451 | $ 15,081 | $ 22,354 | $ (5,971) | 17,666 | $ 11,873 | $ 25,551 | $ 8,606 | 52,915 | 63,696 | 66,263 | ||||
Henderson | |||||||||||||||
Acquisition | |||||||||||||||
Total consideration | $ 98,511 | ||||||||||||||
Working capital adjustment | $ 4,688 | ||||||||||||||
Payable to former shareholder | 3,340 | ||||||||||||||
Allocation of the purchase price paid to the fair value of the net assets for acquisition | |||||||||||||||
Earnout | (529) | (636) | (636) | (529) | (636) | ||||||||||
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 | ||||||||||||||
Payment of on hand cash at acquisition | 31,994 | ||||||||||||||
Transactions expenses | 3,422 | ||||||||||||||
Adjusted fair value of earn out consideration | 10,373 | 10,373 | 10,373 | ||||||||||||
Subsequent adjustment | 173 | ||||||||||||||
Maximum earnout | 21,487 | 21,487 | 21,487 | ||||||||||||
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 | ||||||||||||||
Inventories | 20,017 | ||||||||||||||
Truck chassis floor plan inventory | 13,479 | ||||||||||||||
Prepaid and other current assets | 705 | ||||||||||||||
Property and equipment | 5,821 | ||||||||||||||
Goodwill | 77,354 | ||||||||||||||
Intangible assets | 77,800 | ||||||||||||||
Other assets, long-term | 219 | ||||||||||||||
Accounts payable and other current liabilities | (3,881) | ||||||||||||||
Floor plan obligations | (13,479) | ||||||||||||||
Earnout | (10,200) | $ (3,100) | $ (10,373) | $ (10,373) | (3,100) | (10,373) | |||||||||
Total | 181,344 | ||||||||||||||
Pro forma Information | |||||||||||||||
Net sales | 490,243 | 517,716 | |||||||||||||
Net income | $ 45,983 | $ 45,760 | |||||||||||||
Earnings per common share assuming dilution attributable to common shareholders | $ 2 | $ 2.01 | |||||||||||||
Revenues since acquisition | $ 65,044 | ||||||||||||||
Pre-tax operating income (losses) since acquisition | $ (1,397) | ||||||||||||||
Dejana | Revolving credit facility | |||||||||||||||
Acquisition | |||||||||||||||
Short-term borrowings (repayments), net | $ 20,000 | ||||||||||||||
Arrowhead Equipment, Inc. [Member] | |||||||||||||||
Acquisition | |||||||||||||||
Total consideration | $ 7,385 | ||||||||||||||
Transactions expenses | 343 | ||||||||||||||
Pro forma Information | |||||||||||||||
Revenues since acquisition | 7,964 | ||||||||||||||
Pre-tax operating income (losses) since acquisition | $ 607 |
Acquisitions - Intangibles (Det
Acquisitions - Intangibles (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Noncompete agreements | |
Intangibles | |
Amortization period | 4 years |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Inventories | ||
Finished goods | $ 35,547 | $ 39,822 |
Work-in-process | 7,774 | 4,225 |
Raw material and supplies | 28,203 | 26,824 |
Inventories | 71,524 | 70,871 |
Inventories - truck chassis floor plan | $ 7,711 | $ 3,939 |
Property, plant and equipment59
Property, plant and equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Property, plant and equipment | ||
Total property, plant and equipment | $ 104,959 | $ 96,524 |
Less accumulated depreciation | (50,997) | (44,383) |
Net property, plant and equipment | 53,962 | 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 | 4,183 | 2,569 |
Buildings | ||
Property, plant and equipment | ||
Total property, plant and equipment | 26,846 | 26,058 |
Machinery and equipment | ||
Property, plant and equipment | ||
Total property, plant and equipment | 44,618 | 40,878 |
Furniture and fixtures | ||
Property, plant and equipment | ||
Total property, plant and equipment | 13,681 | 12,561 |
Mobile equipment and other | ||
Property, plant and equipment | ||
Total property, plant and equipment | 4,576 | 3,873 |
Construction-in-process | ||
Property, plant and equipment | ||
Total property, plant and equipment | $ 4,320 | $ 3,850 |
Other Intangible Asset - Summar
Other Intangible Asset - Summary (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Other intangible assets | ||
Amortizable intangibles, gross carrying amount | $ 198,075 | $ 195,375 |
Amortizable intangibles, accumulated amortization | 89,525 | 78,124 |
Amortizable intangibles, net carrying amount | 108,550 | 117,251 |
Intangible Assets, Gross (Excluding Goodwill), Total | 275,675 | 272,975 |
Net Carrying Amount | 186,150 | 194,851 |
Distribution network | ||
Other intangible assets | ||
Amortizable intangibles, gross carrying amount | 80,000 | 80,000 |
Amortizable intangibles, accumulated amortization | 55,000 | 51,000 |
Amortizable intangibles, net carrying amount | 25,000 | 29,000 |
Customer relations | ||
Other intangible assets | ||
Amortizable intangibles, gross carrying amount | 80,920 | 78,220 |
Amortizable intangibles, accumulated amortization | 11,304 | 6,075 |
Amortizable intangibles, net carrying amount | 69,616 | 72,145 |
Patents | ||
Other intangible assets | ||
Amortizable intangibles, gross carrying amount | 21,136 | 21,136 |
Amortizable intangibles, accumulated amortization | 10,721 | 9,466 |
Amortizable intangibles, net carrying amount | 10,415 | 11,670 |
Noncompete agreements | ||
Other intangible assets | ||
Amortizable intangibles, gross carrying amount | 8,640 | 8,640 |
Amortizable intangibles, accumulated amortization | 7,055 | 6,232 |
Amortizable intangibles, net carrying amount | 1,585 | 2,408 |
Trademark | ||
Other intangible assets | ||
Amortizable intangibles, gross carrying amount | 5,459 | 5,459 |
Amortizable intangibles, accumulated amortization | 3,525 | 3,431 |
Amortizable intangibles, net carrying amount | 1,934 | 2,028 |
Backlog | ||
Other intangible assets | ||
Amortizable intangibles, gross carrying amount | 1,900 | 1,900 |
Amortizable intangibles, accumulated amortization | 1,900 | 1,900 |
License | ||
Other intangible assets | ||
Amortizable intangibles, gross carrying amount | 20 | 20 |
Amortizable intangibles, accumulated amortization | 20 | 20 |
Trademark and tradenames | ||
Other intangible assets | ||
Indefinite-lived intangibles, net carrying amount | $ 77,600 | $ 77,600 |
Other Intangible Asset - Estima
Other Intangible Asset - Estimated Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Other Intangible Assets | |||
Intangibles amortization | $ 11,401 | $ 10,596 | $ 7,362 |
Estimated amortization expense for the next five years | |||
2,018 | 11,476 | ||
2,019 | 10,954 | ||
2,020 | 10,932 | ||
2,021 | 10,670 | ||
2,022 | $ 10,520 | ||
Weighted average remaing life for intangible assets | 11 years 3 months 18 days | ||
Amount received from settlement | $ 1,275 | $ 10,050 |
Long-Term Debt - Summary (Detai
Long-Term Debt - Summary (Details) - USD ($) $ in Thousands | Aug. 17, 2017 | Feb. 08, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Jul. 15, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Long-term debt | |||||||
Less current maturities | $ 32,749 | $ 2,829 | |||||
Long-term debt, less current maturities | 274,872 | 306,726 | |||||
Deferred financing costs, net | 3,209 | 4,033 | $ 2,337 | $ 2,485 | |||
Total long-term debt | 274,872 | 306,726 | |||||
Long-term debt, additional disclosure | |||||||
Financing costs | 1,608 | 2,320 | |||||
Inventories - truck chassis floor plan | 7,711 | 3,939 | |||||
Term loan facility | |||||||
Long-term debt | |||||||
Notes and Loans Payable, Current, Total | 310,830 | 313,588 | |||||
Less current maturities | 32,749 | 2,829 | |||||
Long-term debt, less current maturities | 278,081 | $ 310,759 | |||||
Total long-term debt | 310,830 | ||||||
Schedule of maturities on long-term debt | |||||||
2,018 | 32,749 | ||||||
2,019 | 2,749 | ||||||
2,020 | 2,749 | ||||||
2,021 | 272,583 | ||||||
Long-term debt, additional disclosure | |||||||
Incremental term loan | $ 10,000 | ||||||
Actual interest rate (as a percent) | 4.70% | 5.25% | |||||
Unamortized discount on issuance of debt | $ 1,562 | $ 1,953 | |||||
Financing costs | 2,120 | ||||||
Revolving credit facility | |||||||
Long-term debt, additional disclosure | |||||||
Financing costs | 200 | ||||||
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 | ||||||
Remaining borrowing availability | $ 99,463 | ||||||
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 | Maximum | |||||||
Long-term debt, additional disclosure | |||||||
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 | |||||||
Long-term debt, additional disclosure | |||||||
Maximum borrowing capacity | $ 190,000 | ||||||
Borrowings under senior credit facility | $ 313,962 | $ 315,540 | 313,962 | $ 130,000 | |||
Excess cash flow payment | 11,279 | ||||||
Voluntary payment | 18,721 | ||||||
Senior credit facilities | Term loan facility | Maximum | |||||||
Long-term debt, additional disclosure | |||||||
Additional term loan commitments | $ 80,000 | ||||||
Debt ratio | 3.25 | ||||||
Senior credit facilities | Term loan facility | ABR | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 3.25% | ||||||
Senior credit facilities | Term loan facility | ABR | Maximum | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 2.00% | ||||||
Senior credit facilities | Term loan facility | ABR | Minimum | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 2.50% | ||||||
Senior credit facilities | Term loan facility | Euro dollar | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 4.25% | ||||||
Senior credit facilities | Term loan facility | Euro dollar | Maximum | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 3.00% | ||||||
Senior credit facilities | Term loan facility | Euro dollar | Minimum | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 3.50% | ||||||
Senior credit facilities | Term loan facility | First option | Minimum | |||||||
Long-term debt, additional disclosure | |||||||
Additional interest margin added to fixed and variable rates (as a percent) | 1.00% | ||||||
Additional fixed interest rate spread (as a percent) | 1.00% | ||||||
Senior credit facilities | Term loan facility | First 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 | Term loan facility | First option | Fixed rate | |||||||
Long-term debt, additional disclosure | |||||||
Fixed interest rate base (as a percent) | 2.00% | ||||||
Senior credit facilities | Term loan facility | First option | One month London Interbank Offered Rate | |||||||
Long-term debt, additional disclosure | |||||||
Variable rate basis description | LIBOR for a one month interest period | ||||||
Senior credit facilities | Term loan facility | First option | Prime | |||||||
Long-term debt, additional disclosure | |||||||
Variable rate basis description | Prime Rate | ||||||
Senior credit facilities | Term loan facility | Second option | Fixed rate | |||||||
Long-term debt, additional disclosure | |||||||
Fixed interest rate base (as a percent) | 3.00% | ||||||
Additional fixed interest rate spread (as a percent) | 1.00% | ||||||
Senior credit facilities | Revolving credit facility | Second option | Federal funds | |||||||
Long-term debt, additional disclosure | |||||||
Variable rate basis description | federal funds | ||||||
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 | ||||||
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 | ABR | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 2.50% | ||||||
Senior credit facilities | Amended term loan facility | Euro dollar | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 3.50% | ||||||
Letter of Credit | |||||||
Long-term debt, additional disclosure | |||||||
Maximum borrowing capacity | $ 10,000 | ||||||
Revolving credit facility | |||||||
Long-term debt | |||||||
Total long-term debt | 0 | ||||||
Long-term debt, additional disclosure | |||||||
Maximum borrowing capacity | 100,000 | ||||||
Annual acquisitions allowed | $ 12,500 | ||||||
Fixed charge coverage ratio to be maintained if certain minimum availability under the credit facility is not maintained. | 1 | ||||||
Revolving credit facility | Maximum | |||||||
Long-term debt, additional disclosure | |||||||
Facilities consolidation expenditure allowed | $ 15,000 | ||||||
Revolving credit facility | First option | Fixed rate | Maximum | |||||||
Long-term debt, additional disclosure | |||||||
Fixed interest rate base (as a percent) | 2.00% | ||||||
Revolving credit facility | First option | Fixed rate | Minimum | |||||||
Long-term debt, additional disclosure | |||||||
Fixed interest rate base (as a percent) | 1.50% | ||||||
Revolving credit facility | Second option | Federal funds | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 0.50% | ||||||
Revolving credit facility | Second option | Federal funds | Maximum | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 1.00% | ||||||
Revolving credit facility | Second option | Federal funds | Minimum | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 0.50% | ||||||
Revolving credit facility | Second option | One month London Interbank Offered Rate | |||||||
Long-term debt, additional disclosure | |||||||
Interest rate margin (as a percent) | 1.00% | ||||||
Swingline loan | |||||||
Long-term debt, additional disclosure | |||||||
Maximum borrowing capacity | $ 5,000 | ||||||
Prior To Amendment | Senior credit facilities | Term loan facility | |||||||
Long-term debt, additional disclosure | |||||||
Borrowings under senior credit facility | 100,000 | ||||||
Incremental term loan | $ 5,000 |
Long-Term Debt - Swaps (Details
Long-Term Debt - Swaps (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Feb. 20, 2015 | |
Derivative [Line Items] | |||
Negative fair value | $ 2,178 | $ 1,985 | |
Bailment Pool Chasis Inventories Net | 17,447 | 22,420 | |
Inventories - truck chassis floor plan | 7,711 | 3,939 | |
Bailment pool | |||
Derivative [Line Items] | |||
Bailment Pool Chasis Inventories Net | 17,447 | 22,420 | |
Dejana | Bailment pool | |||
Derivative [Line Items] | |||
Interest Expense, Debt | $ 201 | 79 | |
Prime | Bailment pool | |||
Derivative [Line Items] | |||
Debt Instrument, Interest Rate, Effective Percentage | 4.50% | ||
Senior credit facilities | Floor plan | |||
Derivative [Line Items] | |||
Maximum borrowing capacity | $ 20,000 | ||
Senior credit facilities | Dejana | Floor plan | |||
Derivative [Line Items] | |||
Interest Expense, Debt | $ 186 | 92 | |
Senior credit facilities | London Interbank Offered Rate (LIBOR) | Floor plan | |||
Derivative [Line Items] | |||
Interest rate margin (as a percent) | 1.75% | ||
Senior credit facilities | Prime | Floor plan | |||
Derivative [Line Items] | |||
Inventories - truck chassis floor plan | $ 7,711 | 3,939 | |
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 | $ 2,178 | 1,985 | |
Interest rate swap | Accrued Expenses and Other Current Liabilities | |||
Derivative [Line Items] | |||
Negative fair value | 597 | 335 | |
Interest rate swap | Other Noncurrent Liabilities | |||
Derivative [Line Items] | |||
Negative fair value | $ 1,581 | $ 1,650 | |
Interest Rate Swap Effective 31 December 2015 through 29 March 2018 | |||
Derivative [Line Items] | |||
Notional amount | $ 90,000 | ||
Interest rate | 6.916% | ||
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) | 3.00% | ||
LIBOR floor (as a percent) | 1.00% | ||
Interest Rate Swap Effective 29 March 2018 through 31 March 2020 | |||
Derivative [Line Items] | |||
Notional amount | 45,000 | ||
Interest rate | 6.105% | ||
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) | 3.00% | ||
LIBOR floor (as a percent) | 1.00% | ||
Interest Rate Swap Effective 31 March 2020 through 30 June 2021 | |||
Derivative [Line Items] | |||
Notional amount | $ 135,000 | ||
Interest rate | 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) | 3.00% | ||
LIBOR floor (as a percent) | 1.00% |
Accrued Expenses and Other Cu64
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Accrued Expenses and Other Current Liabilities | ||
Payroll and related costs | $ 6,923 | $ 8,731 |
Employee benefits | 4,701 | 5,179 |
Accrued warranty | 3,262 | 3,535 |
Earnout - Dejana | 5,487 | |
Other | 6,118 | 4,393 |
Accrued expenses and other current liabilities | $ 21,004 | $ 27,325 |
Warranty Liability (Details)
Warranty Liability (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Warranty liability | |||
Period of warranty history used in estimating warranty costs | 5 years | ||
Other long-term liabilities | $ 17,004 | $ 15,652 | |
Accrued expenses and other current liabilities | 21,004 | 27,325 | |
Company's warranty liability: | |||
Balance at the beginning of the period | 6,160 | 7,423 | $ 6,279 |
Warranty provision | 2,506 | 2,452 | 4,931 |
Claims paid/settlements | (3,054) | (3,750) | (3,787) |
Balance at the end of the period | 5,677 | 6,160 | $ 7,423 |
Warranty Reserves | |||
Warranty liability | |||
Other long-term liabilities | 2,415 | 2,625 | |
Accrued expenses and other current liabilities | 3,262 | 3,535 | |
Henderson | |||
Company's warranty liability: | |||
Establish warranty provision for acquired companies | $ 65 | ||
Dejana | |||
Company's warranty liability: | |||
Establish warranty provision for acquired companies | $ 35 | ||
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 |
Income Taxes - Provision (Detai
Income Taxes - Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||
Federal | $ 11,897 | $ 16,664 | $ 15,298 |
State | 988 | 1,866 | 2,057 |
Current income tax expense (benefit) | 12,885 | 18,530 | 17,355 |
Deferred: | |||
Federal | (17,264) | 4,930 | 6,103 |
State | 1,970 | 1,227 | (1,371) |
Deferred income tax expense (benefit) | $ (15,294) | $ 6,157 | $ 4,732 |
Income Taxes - Reconciliation (
Income Taxes - Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of income tax expense computed at the federal statutory rate to the provision for income taxes | |||
Federal income tax expense at statutory rate | $ 18,520 | $ 22,294 | $ 23,192 |
State taxes, net of federal benefit | 1,539 | 2,547 | 1,077 |
Valuation allowance changes | (7) | (1,028) | |
Change in uncertain tax positions, net | 1,043 | 50 | 43 |
Research and development credit | (160) | (274) | (241) |
Rate change | 240 | 64 | (30) |
Manufacturing tax benefits | (933) | (1,248) | (1,302) |
Prior period adjustments | 1,096 | ||
Federal deferred rate change | (22,452) | ||
Other | (206) | 165 | 376 |
Provision for income tax expense (benefit) | $ (2,409) | $ 24,687 | $ 22,087 |
Income Taxes - Deferred Assets
Income Taxes - Deferred Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||
Allowance for doubtful accounts | $ 259 | $ 393 |
Inventory reserves | 967 | 1,111 |
Warranty liability | 1,421 | 2,244 |
Deferred compensation | 781 | 548 |
Earnout liabilities | 694 | 242 |
Pension and retiree health benefit obligations | 3,242 | 5,432 |
Accrued vacation | 656 | 866 |
Medical claims reserve | 189 | 72 |
State net operating losses | 3,386 | 2,853 |
Other accrued liabilities | 2,092 | 2,967 |
Valuation allowance for state net operating losses | (777) | (640) |
Total deferred tax assets | 12,910 | 16,088 |
Deferred tax liabilities: | ||
Tax deductible goodwill and other intangibles | (47,163) | (63,324) |
Accelerated depreciation | (5,084) | (7,176) |
Other | 68 | (151) |
Total deferred tax liabilities | (52,179) | (70,651) |
Net deferred tax liabilities | (39,269) | (54,563) |
State net operating losses | 3,386 | 2,853 |
Valuation allowance for state net operating losses | 777 | $ 640 |
State | ||
Deferred tax liabilities: | ||
Operating loss carry forwards | $ 3,386 |
Income Taxes - Uncertain tax po
Income Taxes - Uncertain tax positions (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
A reconciliation of the beginning and ending liability for uncertain tax positions | ||||
Balance at beginning of year | $ 3,531 | $ 2,361 | $ 490 | $ 464 |
Increase Resulting from Current Period Tax Positions | 97 | 73 | 26 | |
Increases for tax position taken in prior years | 1,602 | 1,809 | ||
Decreases due to settlements with taxing authorities | (8) | (11) | ||
Decreases due to lapses in the statute of limitations | (521) | |||
Balance at the end of year | 3,531 | 2,361 | $ 490 | |
Unrecognized tax benefits that would affect the effective tax rate, if recognized | 1,706 | |||
Accrued interest and penalties reported as income tax liability | $ 804 | $ 79 | ||
U.S. corporate income tax rate | 35.00% | |||
Net deferred tax liability | $ 22,452 | |||
Forecast | ||||
A reconciliation of the beginning and ending liability for uncertain tax positions | ||||
U.S. corporate income tax rate | 21.00% |
Employee Retirement Plans - Rec
Employee Retirement Plans - Reconciliations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Components of net periodic cost: | |||
Service cost | $ 561 | $ 531 | |
Net periodic pension cost | 1,278 | 1,221 | |
Change in plan assets: | |||
Fair value of plan assets at beginning of year | 29,223 | ||
Fair value of plan assets at end of year | 33,903 | 29,223 | |
Amounts recognized in the consolidated balance sheets consisted | |||
Retiree health benefit obligation | 6,809 | 7,193 | |
Pension plan | |||
Components of net periodic cost: | |||
Service cost | 356 | 321 | $ 257 |
Interest cost | 1,613 | 1,639 | 1,489 |
Expected return on plan assets | (1,790) | (1,824) | (1,630) |
Amortization of net (gain) loss | 723 | 724 | 1,021 |
Net periodic pension cost | 902 | 860 | 1,137 |
Employer contributions during the period | 1,669 | 1,711 | |
Change in projected benefit obligation: | |||
Benefit obligation at beginning of year | 39,407 | 37,217 | |
Actuarial (gain) loss | 3,571 | 1,469 | |
Benefits paid | (1,283) | (1,239) | |
Benefit obligation at end of year | 43,664 | 39,407 | 37,217 |
Change in plan assets: | |||
Fair value of plan assets at beginning of year | 29,223 | 26,378 | |
Actual return (loss) on plan assets | 4,294 | 2,373 | |
Benefits paid | (1,283) | (1,239) | |
Fair value of plan assets at end of year | 33,903 | 29,223 | 26,378 |
Defined Benefit Plan, Funded Status of Plan, Total | (9,761) | (10,184) | |
Salaried Pension Plan | |||
Accumulated benefit obligation | 42,876 | 38,799 | |
Pension plan | Minimum | |||
Components of net periodic cost: | |||
Employer contributions during the period | 169 | ||
Other postretirement benefit cost | |||
Components of net periodic cost: | |||
Service cost | 205 | 210 | 229 |
Interest cost | 278 | 278 | 256 |
Amortization of net (gain) loss | (107) | (127) | (69) |
Net periodic pension cost | 376 | 361 | 416 |
Change in projected benefit obligation: | |||
Benefit obligation at beginning of year | 7,333 | 6,896 | |
Participant contributions | 25 | 38 | |
Actuarial (gain) loss | (853) | 53 | |
Benefits paid | (39) | (142) | |
Benefit obligation at end of year | 6,949 | 7,333 | $ 6,896 |
Change in plan assets: | |||
Benefits paid | $ (39) | (142) | |
Period of coverage under the plan | 10 years | ||
Amounts recognized in the consolidated balance sheets consisted | |||
Accrued expenses and other current liabilities | $ 140 | 140 | |
Retiree health benefit obligation | 6,809 | 7,193 | |
Amounts recognized in the consolidated balance sheets | $ 6,949 | $ 7,333 | |
Salaried Pension Plan | |||
Period of service of employees | 12 years |
Employee Retirement Plans - Ass
Employee Retirement Plans - Assumptions (Details) | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Pension plan | |||||
Assumptions used in determining net periodic pension cost for the plans | |||||
Discount rates (as a percent) | 4.20% | ||||
Expected long-term rate of return on assets (as a percent) | 6.50% | 7.25% | 7.25% | ||
Pension plan | Minimum | |||||
Assumptions used in determining net periodic pension cost for the plans | |||||
Discount rates (as a percent) | 4.50% | 3.90% | |||
Pension plan | Maximum | |||||
Assumptions used in determining net periodic pension cost for the plans | |||||
Discount rates (as a percent) | 4.00% | ||||
Salaried Pension Plan | |||||
Assumptions used in determining net periodic pension cost for the plans | |||||
Rates of increase in compensation levels: Salaried (as a percent) | 3.50% | 3.50% | 3.50% | ||
Assumptions used to determine the benefit obligation | |||||
Discount rate (as a percent) | 4.20% | ||||
Salaried Pension Plan | Forecast | |||||
Assumptions used in determining net periodic pension cost for the plans | |||||
Expected long-term rate of return on assets (as a percent) | 5.80% | ||||
Hourly Pension Plan | |||||
Assumptions used to determine the benefit obligation | |||||
Discount rate (as a percent) | 3.60% | 4.50% | |||
Hourly Pension Plan | Forecast | |||||
Assumptions used in determining net periodic pension cost for the plans | |||||
Expected long-term rate of return on assets (as a percent) | 6.50% | ||||
Other postretirement benefit cost | |||||
Assumptions used in determining net periodic pension cost for the plans | |||||
Discount rates (as a percent) | 3.80% | 4.10% | 3.70% | ||
Summary of healthcare cost trend rates | |||||
Ultimate healthcare cost trend rate (as a percent) | 4.50% | 4.50% | 4.50% | ||
Participation (as a percent) | 60.00% | 60.00% | 60.00% | ||
Assumed health care cost trend rate for the next fiscal year (as a percent) | 7.00% | 7.00% | |||
Ultimate rate in 2025 (as a percent) | 4.50% | ||||
Ultimate rate in 2024 (as a percent) | 4.50% | ||||
Ultimate rate in 2023 (as a percent) | 4.50% | ||||
Assumptions used to determine the benefit obligation | |||||
Discount rate (as a percent) | 4.10% | 3.70% | |||
Other postretirement benefit cost | Under 65 | |||||
Summary of healthcare cost trend rates | |||||
Assumed health care cost trend rate for the next fiscal year (as a percent) | 7.00% |
Employee Retirement Plans - Exp
Employee Retirement Plans - Expected Benefit Payments (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Expected benefit payments | ||
Voluntary contribution | $ 1,500 | |
Pension plan | ||
Expected benefit payments | ||
2,018 | 1,540 | |
2,019 | 1,460 | |
2,020 | 1,510 | |
2,021 | 1,550 | |
2,022 | 1,720 | |
2023-2027 | 10,230 | |
Pension funding contributions made | 1,669 | $ 1,711 |
Required pension funding contributions expected to be made in next fiscal year | 72 | |
Pension plan | Minimum | ||
Expected benefit payments | ||
Pension funding contributions made | $ 169 |
Employee Retirement Plans - A73
Employee Retirement Plans - Asset Allocation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Employee retirement plans | |||
Actual allocation of pension plan assets | $ 33,903 | $ 29,223 | |
Pension plan | |||
Employee retirement plans | |||
Actual allocation of pension plan assets | $ 33,903 | 29,223 | $ 26,378 |
Qualified Hourly Pension Plan [Member] | |||
Employee retirement plans | |||
Target (as a percent) | 100.00% | ||
Actual allocation of pension plan assets | $ 6,438 | $ 5,576 | |
Weighted-average asset allocation (as a percent) | 100.00% | 100.00% | |
Qualified Hourly Pension Plan [Member] | Large Cap Equity | |||
Employee retirement plans | |||
Target (as a percent) | 34.00% | ||
Actual allocation of pension plan assets | $ 2,259 | $ 1,991 | |
Weighted-average asset allocation (as a percent) | 35.00% | 36.00% | |
Qualified Hourly Pension Plan [Member] | Mid Cap Equity | |||
Employee retirement plans | |||
Target (as a percent) | 3.00% | ||
Actual allocation of pension plan assets | $ 199 | $ 177 | |
Weighted-average asset allocation (as a percent) | 3.00% | 3.00% | |
Qualified Hourly Pension Plan [Member] | Small Cap Equity | |||
Employee retirement plans | |||
Target (as a percent) | 1.00% | ||
Actual allocation of pension plan assets | $ 73 | $ 67 | |
Weighted-average asset allocation (as a percent) | 1.00% | 1.00% | |
Qualified Hourly Pension Plan [Member] | International Equity | |||
Employee retirement plans | |||
Target (as a percent) | 14.00% | ||
Actual allocation of pension plan assets | $ 950 | $ 664 | |
Weighted-average asset allocation (as a percent) | 15.00% | 12.00% | |
Qualified Hourly Pension Plan [Member] | Emerging markets Equity | |||
Employee retirement plans | |||
Target (as a percent) | 2.00% | ||
Actual allocation of pension plan assets | $ 128 | $ 88 | |
Weighted-average asset allocation (as a percent) | 2.00% | 2.00% | |
Qualified Hourly Pension Plan [Member] | Fixed Income and Cash Equivalents | |||
Employee retirement plans | |||
Target (as a percent) | 40.00% | ||
Actual allocation of pension plan assets | $ 2,447 | $ 2,256 | |
Weighted-average asset allocation (as a percent) | 38.00% | 40.00% | |
Qualified Hourly Pension Plan [Member] | Real Estate | |||
Employee retirement plans | |||
Target (as a percent) | 6.00% | ||
Actual allocation of pension plan assets | $ 382 | $ 333 | |
Weighted-average asset allocation (as a percent) | 6.00% | 6.00% | |
Salaried Pension Plan | |||
Employee retirement plans | |||
Target (as a percent) | 100.00% | ||
Actual allocation of pension plan assets | $ 27,465 | $ 23,647 | |
Weighted-average asset allocation (as a percent) | 100.00% | 100.00% | |
Salaried Pension Plan | Large Cap Equity | |||
Employee retirement plans | |||
Target (as a percent) | 21.00% | ||
Actual allocation of pension plan assets | $ 6,111 | $ 8,444 | |
Weighted-average asset allocation (as a percent) | 23.00% | 36.00% | |
Salaried Pension Plan | Mid Cap Equity | |||
Employee retirement plans | |||
Target (as a percent) | 2.00% | ||
Actual allocation of pension plan assets | $ 542 | $ 752 | |
Weighted-average asset allocation (as a percent) | 2.00% | 3.00% | |
Salaried Pension Plan | Small Cap Equity | |||
Employee retirement plans | |||
Target (as a percent) | 1.00% | ||
Actual allocation of pension plan assets | $ 201 | $ 282 | |
Weighted-average asset allocation (as a percent) | 1.00% | 1.00% | |
Salaried Pension Plan | International Equity | |||
Employee retirement plans | |||
Target (as a percent) | 9.00% | ||
Actual allocation of pension plan assets | $ 2,573 | $ 2,815 | |
Weighted-average asset allocation (as a percent) | 9.00% | 12.00% | |
Salaried Pension Plan | Emerging markets Equity | |||
Employee retirement plans | |||
Target (as a percent) | 1.00% | ||
Actual allocation of pension plan assets | $ 348 | $ 374 | |
Weighted-average asset allocation (as a percent) | 1.00% | 2.00% | |
Salaried Pension Plan | Fixed Income and Cash Equivalents | |||
Employee retirement plans | |||
Target (as a percent) | 60.00% | ||
Actual allocation of pension plan assets | $ 16,046 | $ 9,565 | |
Weighted-average asset allocation (as a percent) | 58.00% | 40.00% | |
Salaried Pension Plan | Real Estate | |||
Employee retirement plans | |||
Target (as a percent) | 6.00% | ||
Actual allocation of pension plan assets | $ 1,644 | $ 1,415 | |
Weighted-average asset allocation (as a percent) | 6.00% | 6.00% |
Employee Retirement Plans - Fai
Employee Retirement Plans - Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Employee retirement plans | ||||
Total pension plan assets | $ 33,903 | $ 29,223 | ||
Level 2 | ||||
Employee retirement plans | ||||
Total pension plan assets | 31,877 | 27,475 | ||
Level 3 | ||||
Employee retirement plans | ||||
Total pension plan assets | 2,026 | 1,748 | $ 1,748 | $ 1,364 |
Equity holdings | ||||
Employee retirement plans | ||||
Total pension plan assets | 13,384 | 15,654 | ||
Equity holdings | Level 2 | ||||
Employee retirement plans | ||||
Total pension plan assets | 13,384 | 15,654 | ||
Fixed-income holdings | ||||
Employee retirement plans | ||||
Total pension plan assets | 18,493 | 11,821 | ||
Fixed-income holdings | Level 2 | ||||
Employee retirement plans | ||||
Total pension plan assets | 18,493 | 11,821 | ||
Alternative investments | ||||
Employee retirement plans | ||||
Total pension plan assets | 2,026 | 1,748 | ||
Alternative investments | Level 3 | ||||
Employee retirement plans | ||||
Total pension plan assets | 2,026 | 1,748 | ||
Pension plan | ||||
Employee retirement plans | ||||
Total pension plan assets | $ 33,903 | $ 29,223 | $ 26,378 |
Employee Retirement Plans - FV
Employee Retirement Plans - FV Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Reconciliation of the fair value measurements using significant unobservable inputs (Level 3) | ||
Fair value of plan assets at beginning of year | $ 29,223 | |
Fair value of plan assets at end of year | 33,903 | $ 29,223 |
Level 3 | ||
Reconciliation of the fair value measurements using significant unobservable inputs (Level 3) | ||
Fair value of plan assets at beginning of year | 1,748 | 1,748 |
Deposits | 100 | 101 |
Actual return on plan assets held at reporting date | 142 | 138 |
Withdrawls | 36 | 145 |
Fair value of plan assets at end of year | 2,026 | 1,748 |
Pension plan | ||
Reconciliation of the fair value measurements using significant unobservable inputs (Level 3) | ||
Fair value of plan assets at beginning of year | 29,223 | 26,378 |
Fair value of plan assets at end of year | $ 33,903 | $ 29,223 |
Employee Retirement Plans - Cha
Employee Retirement Plans - Changes in Healthcare Cost Trend Rate (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Pension plan | |
Amounts included in other comprehensive loss, net of tax | |
Net actuarial gain (loss) | $ (6,636) |
Amounts that will be amortized from accumulated other comprehensive income loss into net periodic pension or OPEB cost in the next fiscal year | |
Estimated actuarial gain (loss) | (706) |
Other postretirement benefit cost | |
Effect of one percentage point change in the healthcare cost trend rate | |
Effect on total service and interest cost, 1% increase | 54 |
Effect on total service and interest cost, 1% decrease | (46) |
Effect on postretirement benefit obligation, 1% increase | 762 |
Effect on postretirement benefit obligation, 1% decrease | (669) |
Amounts included in other comprehensive loss, net of tax | |
Net actuarial gain (loss) | 1,392 |
Amounts that will be amortized from accumulated other comprehensive income loss into net periodic pension or OPEB cost in the next fiscal year | |
Estimated actuarial gain (loss) | $ 211 |
Employee Retirement Plans - Def
Employee Retirement Plans - Defined Contribution and Nonqualified Plans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Defined contribution plan | |||
Company's matching contributions | $ 625 | $ 863 | $ 377 |
Non-discretionary employer contributions | 1,128 | 901 | 1,264 |
Expense | 1,278 | 1,221 | |
Non-qualified plan | |||
Defined contribution plan | |||
Expense | 526 | 511 | 496 |
Amount accrued | $ 4,980 | 3,471 | 2,482 |
Henderson Defined Contribution Plan | |||
Defined contribution plan | |||
Company's matching contributions | $ 299 | ||
Dejana Defined Contribution Plan | |||
Defined contribution plan | |||
Company's matching contributions | $ 119 |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Restricted Stock Awards and Units (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Stock-based compensation | |||||||
Proceeds from exercise of stock options | $ 111 | ||||||
Common Stock | |||||||
Options | |||||||
Exercised (in shares) | 26,350 | ||||||
A&R 2004 Plan | Common Stock | |||||||
Stock-based compensation | |||||||
Shares reserved for issuance | 0 | ||||||
2010 Plan | Common Stock | |||||||
Stock-based compensation | |||||||
Maximum number of shares of common stock that may be issued | 2,130,000 | ||||||
Number of shares of common stock available for grant | 1,147,750 | ||||||
Restricted Stock Share Awards | |||||||
Shares | |||||||
Unvested at the beginning of the period (in shares) | 14,701 | 85,021 | 14,701 | 85,021 | |||
Vested (in shares) | (14,701) | (70,320) | |||||
Unvested at the end of the period (in shares) | 14,701 | 85,021 | |||||
Weighted Average Grant Date Fair Value | |||||||
Unvested at the beginning of the period (in dollars per share) | $ 14.78 | $ 13.02 | $ 14.78 | $ 13.02 | |||
Vested (in dollars per share) | $ 14.78 | 12.65 | |||||
Unvested at the end of the period (in dollars per share) | $ 14.78 | $ 13.02 | |||||
Weighted Average Remaining Contractual Term | |||||||
Unvested at the beginning of the period | 4 days | 6 months 4 days | |||||
Unvested at the end of the period | 4 days | 6 months 4 days | |||||
Restricted Stock Unit Awards | |||||||
Shares | |||||||
Unvested at the beginning of the period (in shares) | 47,790 | 48,665 | 81,623 | 47,790 | 48,665 | 81,623 | |
Granted (in shares) | 128,893 | 131,765 | 116,141 | ||||
Vested (in shares) | (128,697) | (132,640) | (147,217) | ||||
Cancelled and forfeited (in shares) | (444) | (1,882) | |||||
Unvested at the end of the period (in shares) | 47,542 | 47,790 | 48,665 | 81,623 | |||
Expected to vest in the future, at the end of the period (in shares) | 45,830 | ||||||
Weighted Average Grant Date Fair Value | |||||||
Unvested at the beginning of the period (in dollars per share) | $ 20.31 | $ 17.33 | $ 15.05 | $ 20.31 | $ 17.33 | $ 15.05 | |
Granted (in dollars per share) | $ 33.60 | $ 19.88 | $ 22.63 | 24.31 | 21.37 | 18.72 | |
Vested (in dollars per share) | 22.93 | 20.27 | 16.51 | ||||
Cancelled and forfeited (in dollars per share) | 33.60 | 15.82 | |||||
Unvested at the end of the period (in dollars per share) | 23.95 | $ 20.31 | $ 17.33 | $ 15.05 | |||
Expected to vest in the future, at the end of the period (in dollars per share) | $ 23.95 | ||||||
Weighted Average Remaining Contractual Term | |||||||
Unvested at the beginning of the period | 10 months 2 days | 11 months 16 days | 1 year | 1 year 1 month 2 days | |||
Granted | 3 months 22 days | 4 months 6 days | 4 months 24 days | ||||
Unvested at the end of the period | 10 months 2 days | 11 months 16 days | 1 year | 1 year 1 month 2 days | |||
Expected to vest in future, at the end of the period | 10 months 2 days | ||||||
Stock Options | A&R 2004 Plan | |||||||
Stock-based compensation | |||||||
Proceeds from exercise of stock options | $ 111 | ||||||
Options | |||||||
Outstanding stock options | 0 | 0 | |||||
Exercised (in shares) | 0 | 0 | 26,350 | ||||
Cancelled (in shares) | 10,890 |
Stock Based Compensation - Addi
Stock Based Compensation - Additional Information (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Mar. 31, 2018shares | Mar. 31, 2017shares | Mar. 31, 2016shares | Dec. 31, 2017USD ($)itemshares | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Additional Employee Stock Plans Information | ||||||
Income tax expense | $ (2,409) | $ 24,687 | $ 22,087 | |||
Restricted Stock Share Awards | 2010 Plan | ||||||
Additional Employee Stock Plans Information | ||||||
Compensation expenses recognized | 0 | 0 | 385 | |||
Unrecognized compensation expense, net of expected forfeitures, calculated under the fair value method for shares expected to vest | 0 | 0 | 0 | |||
Performance Share Unit Awards | ||||||
Additional Employee Stock Plans Information | ||||||
Compensation expenses recognized | 1,768 | 1,382 | 1,247 | |||
Unrecognized compensation expense, net of expected forfeitures, calculated under the fair value method for shares expected to vest | 424 | |||||
Performance Share Unit Awards | 2010 Plan | ||||||
Additional Employee Stock Plans Information | ||||||
Compensation expenses recognized | $ 1,732 | 1,516 | ||||
Number of performance shares units that will be converted into RSUs | shares | 64,040 | 87,876 | 71,428 | |||
Restricted Stock Unit Awards | ||||||
Additional Employee Stock Plans Information | ||||||
Vesting period of awards | 2 years | |||||
Restricted Stock Unit Awards | 2010 Plan | ||||||
Additional Employee Stock Plans Information | ||||||
Compensation expenses recognized | 1,643 | |||||
Unrecognized compensation expense, net of expected forfeitures, calculated under the fair value method for shares expected to vest | $ 461 | |||||
Minimum age of employee, attaining which awards are continued to be vested upon retirement | item | 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 | item | 55 | |||||
Maximum period following a termination of service in which the share-based award will be settled | 2 months 15 days | |||||
Percentage of RSUs issued that will immediately vest and be converted into common shares | 33.33% | |||||
Percentage of RSUs issued that will vest ratably over the remaining vesting period | 66.67% | |||||
Restricted Stock Unit Awards | 2010 Plan | Management | ||||||
Additional Employee Stock Plans Information | ||||||
Accelerated stock based compensation expense | $ 619 | $ 528 | $ 303 | |||
Restricted Stock Unit Awards | 2010 Plan | Common Stock | ||||||
Additional Employee Stock Plans Information | ||||||
Number of shares issued upon exercise of units other than options | shares | 1 | |||||
Accounting Standards Update 2016-09 | ||||||
Additional Employee Stock Plans Information | ||||||
Income tax expense | $ 616 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Basic earnings (loss) per common share | |||||||||||
Net income | $ 55,324 | $ 39,009 | $ 44,176 | ||||||||
Less income (loss) allocated to participating securities | 715 | 540 | 604 | ||||||||
Net income (loss) attributable to common shareholders | $ 34,528 | $ 9,327 | $ 14,746 | $ (3,277) | $ 10,101 | $ 7,302 | $ 16,328 | $ 5,278 | $ 54,609 | $ 38,469 | $ 43,572 |
Weighted average common shares outstanding | 22,576,381 | 22,480,679 | 22,329,044 | ||||||||
Basic earnings (loss) per common share (in dollars per share) | $ 1.51 | $ 0.41 | $ 0.64 | $ (0.14) | $ 0.44 | $ 0.32 | $ 0.72 | $ 0.23 | $ 2.42 | $ 1.71 | $ 1.95 |
Earnings per common share assuming dilution | |||||||||||
Net income | $ 55,324 | $ 39,009 | $ 44,176 | ||||||||
Less income (loss) allocated to participating securities | 715 | 540 | 604 | ||||||||
Net income (loss) attributable to common shareholders | $ 34,528 | $ 9,327 | $ 14,746 | $ (3,277) | $ 10,101 | $ 7,302 | $ 16,328 | $ 5,278 | $ 54,609 | $ 38,469 | $ 43,572 |
Weighted average common shares outstanding | 22,576,381 | 22,480,679 | 22,329,044 | ||||||||
Incremental shares applicable to non-participating RSUs | 11,267 | 12,731 | |||||||||
Weighted average common shares assuming dilution | 22,587,648 | 22,480,679 | 22,341,775 | ||||||||
Earnings (loss) per common share assuming dilution (in dollars per share) | $ 1.50 | $ 0.40 | $ 0.64 | $ (0.14) | $ 0.44 | $ 0.32 | $ 0.71 | $ 0.23 | $ 2.40 | $ 1.70 | $ 1.94 |
Commitment and Contingencies (D
Commitment and Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Future Minimum Lease Payments | ||
2,018 | $ 3,081 | |
2,019 | 3,063 | |
2,020 | 2,820 | |
2,021 | 2,716 | |
2,022 | 2,446 | |
Thereafter | 7,794 | |
Total lease obligations | 21,920 | |
Operating lease rent expense | 3,561 | $ 1,665 |
Related Party Leases | ||
Future Minimum Lease Payments | ||
2,018 | 1,976 | |
2,019 | 1,976 | |
2,020 | 1,856 | |
2,021 | 1,796 | |
2,022 | 1,796 | |
Thereafter | 6,388 | |
Total lease obligations | 15,788 | |
Operating lease rent expense | 1,918 | $ 797 |
Third Party Leases | ||
Future Minimum Lease Payments | ||
2,018 | 1,105 | |
2,019 | 1,087 | |
2,020 | 964 | |
2,021 | 920 | |
2,022 | 650 | |
Thereafter | 1,406 | |
Total lease obligations | $ 6,132 |
Segments (Details)
Segments (Details) $ in Thousands | Jul. 15, 2016segment | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Sep. 30, 2016segment | Dec. 31, 2017USD ($)customersegment | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
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 | $ 137,969 | $ 125,339 | $ 139,371 | $ 72,248 | $ 130,143 | $ 123,573 | $ 113,763 | $ 48,789 | $ 474,927 | $ 416,268 | $ 400,408 | ||
Gross profit (loss) | 44,811 | $ 36,055 | $ 45,033 | $ 17,187 | 41,678 | $ 36,644 | $ 41,521 | $ 14,131 | 143,086 | 133,974 | 132,863 | ||
Selling, general and administrative expense | 61,594 | 54,260 | 48,150 | ||||||||||
Income (loss) from operations | 70,091 | 69,118 | 77,351 | ||||||||||
Depreciation expense | 7,183 | 6,146 | 4,919 | ||||||||||
Assets | 685,176 | 666,173 | 685,176 | 666,173 | 497,012 | ||||||||
Capital expenditures | 7,563 | 9,830 | 10,009 | ||||||||||
Capital Expenditures including adjustments to accruals and payables | 8,380 | ||||||||||||
Corporate & Eliminations | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales | (13,407) | (9,414) | 501 | ||||||||||
Selling, general and administrative expense | 15,058 | 15,776 | 14,843 | ||||||||||
Income (loss) from operations | (17,822) | (19,847) | (16,138) | ||||||||||
Depreciation expense | 143 | 197 | 196 | ||||||||||
Assets | 39,817 | 22,425 | 39,817 | 22,425 | 44,935 | ||||||||
Capital expenditures | 29 | ||||||||||||
Operating segment | Work Truck Attachments | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales | 350,564 | 360,638 | 399,907 | ||||||||||
Selling, general and administrative expense | 31,398 | 31,181 | 33,307 | ||||||||||
Income (loss) from operations | 78,088 | 85,888 | 93,489 | ||||||||||
Depreciation expense | 5,533 | 5,377 | 4,723 | ||||||||||
Assets | 425,148 | 439,937 | 425,148 | 439,937 | 452,077 | ||||||||
Capital expenditures | 8,752 | $ 9,980 | |||||||||||
Capital Expenditures including adjustments to accruals and payables | 6,408 | ||||||||||||
Operating segment | Work Truck Solutions segment | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales | 137,770 | 65,044 | |||||||||||
Selling, general and administrative expense | 15,138 | 7,303 | |||||||||||
Income (loss) from operations | 9,825 | 3,077 | |||||||||||
Depreciation expense | 1,507 | 572 | |||||||||||
Assets | $ 220,211 | $ 203,811 | 220,211 | 203,811 | |||||||||
Capital expenditures | $ 1,078 | ||||||||||||
Capital Expenditures including adjustments to accruals and payables | $ 1,972 |
Stockholders' equity (Details)
Stockholders' equity (Details) | 12 Months Ended | |
Dec. 31, 2017item$ / sharesshares | Dec. 31, 2016$ / sharesshares | |
Stockholders' equity | ||
Temporary Equity, Shares Issued | 0 | 0 |
Temporary Equity, Shares Outstanding | 0 | 0 |
Common Stock | ||
Number of votes per share | item | 1 | |
Common Stock, Par or Stated Value Per Share | $ / shares | $ 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 |
Series A Redeemable Preferred Stock | ||
Stockholders' equity | ||
Shares authorized | 5,000,000 | |
Par value (in dollars per share) | $ / shares | $ 0.01 |
Valuation and qualifying acco84
Valuation and qualifying accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Allowance for doubtful accounts | |||
Valuation and qualifying accounts | |||
Balance at the beginning of the year | $ 1,158 | $ 1,343 | $ 1,667 |
Additions charged to earnings | 1,475 | 208 | 305 |
Changes to net | (1,577) | (393) | (629) |
Balance at the end of the year | 1,056 | 1,158 | 1,343 |
Valuation of deferred tax assets | |||
Valuation and qualifying accounts | |||
Balance at the beginning of the year | 640 | 647 | 1,600 |
Changes to net | 137 | (7) | (953) |
Balance at the end of the year | $ 777 | $ 640 | $ 647 |
Changes in Accumulated Other 85
Changes in Accumulated Other Comprehensive Loss by Component - Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 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 | (487) | (1,101) |
Amounts reclassified from accumulated other comprehensive loss | 587 | 612 |
Balance at the end of the period | (6,572) | (6,672) |
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 | (338) | (500) |
Amounts reclassified from accumulated other comprehensive loss | 205 | 242 |
Balance at the end of the period | (1,328) | (1,195) |
Other Postretirement Benefit Liability | ||
Changes to accumulated other comprehensive loss by component | ||
Balance at the beginning of the period | 937 | 1,048 |
Other comprehensive earning (loss) before reclassifications | 521 | (32) |
Amounts reclassified from accumulated other comprehensive loss | (66) | (79) |
Balance at the end of the period | 1,392 | 937 |
Pension Liability | ||
Changes to accumulated other comprehensive loss by component | ||
Balance at the beginning of the period | (6,414) | (6,294) |
Other comprehensive earning (loss) before reclassifications | (670) | (569) |
Amounts reclassified from accumulated other comprehensive loss | 448 | 449 |
Balance at the end of the period | $ (6,636) | $ (6,414) |
Changes in Accumulated Other 86
Changes in Accumulated Other Comprehensive Loss by Component - Reclassifications (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Amounts reclassified from accumulated other comprehensive loss: | |||||||||||
Interest expense, net | $ 18,336 | $ 15,195 | $ 10,895 | ||||||||
Tax expense (benefit) | (2,409) | 24,687 | 22,087 | ||||||||
Reclassification net of tax | $ (34,528) | $ (9,327) | $ (14,746) | $ 3,277 | $ (10,101) | $ (7,302) | $ (16,328) | $ (5,278) | (54,609) | (38,469) | $ (43,572) |
Other Postretirement Benefit Liability | Amount reclassified from accumulated other comprehensive income | |||||||||||
Amounts reclassified from accumulated other comprehensive loss: | |||||||||||
Actuarial (gains) losses | (107) | (127) | |||||||||
Tax expense (benefit) | 41 | 48 | |||||||||
Reclassification net of tax | (66) | (79) | |||||||||
Pension Liability | Amount reclassified from accumulated other comprehensive income | |||||||||||
Amounts reclassified from accumulated other comprehensive loss: | |||||||||||
Actuarial (gains) losses | 723 | 724 | |||||||||
Tax expense (benefit) | (275) | (275) | |||||||||
Reclassification net of tax | 448 | 449 | |||||||||
Unrealized Net Loss on Interest Rate Swap | Interest rate swap | Amount reclassified from accumulated other comprehensive income | |||||||||||
Amounts reclassified from accumulated other comprehensive loss: | |||||||||||
Interest expense, net | 330 | 390 | |||||||||
Tax expense (benefit) | (125) | (148) | |||||||||
Reclassification net of tax | $ 205 | $ 242 |
Quarterly Financial Informati87
Quarterly Financial Information (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Information (unaudited) | |||||||||||
Net sales | $ 137,969 | $ 125,339 | $ 139,371 | $ 72,248 | $ 130,143 | $ 123,573 | $ 113,763 | $ 48,789 | $ 474,927 | $ 416,268 | $ 400,408 |
Gross profit | 44,811 | 36,055 | 45,033 | 17,187 | 41,678 | 36,644 | 41,521 | 14,131 | 143,086 | 133,974 | 132,863 |
Income before taxes | 21,451 | 15,081 | 22,354 | (5,971) | 17,666 | 11,873 | 25,551 | 8,606 | 52,915 | 63,696 | 66,263 |
Net income | $ 34,528 | $ 9,327 | $ 14,746 | $ (3,277) | $ 10,101 | $ 7,302 | $ 16,328 | $ 5,278 | $ 54,609 | $ 38,469 | $ 43,572 |
Basic earnings (loss) per common share (in dollars per share) | $ 1.51 | $ 0.41 | $ 0.64 | $ (0.14) | $ 0.44 | $ 0.32 | $ 0.72 | $ 0.23 | $ 2.42 | $ 1.71 | $ 1.95 |
Earnings (loss) per common share assuming dilution (in dollars per share) | 1.50 | 0.40 | 0.64 | (0.14) | 0.44 | 0.32 | 0.71 | 0.23 | $ 2.40 | $ 1.70 | $ 1.94 |
Cash dividends paid per share (in dollars per share) | $ 0.24 | $ 0.24 | $ 0.24 | $ 0.24 | $ 0.24 | $ 0.24 | $ 0.24 | $ 0.24 | |||
Gain (Loss) Related to Litigation Settlement | $ 10,050 | $ 1,275 | $ 10,050 |
Recent Accounting Pronounceme88
Recent Accounting Pronouncements (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Recent Accounting Pronouncements | ||
Net periodic benefit cost for pensions and other postretirement benefits | $ 1,278 | $ 1,221 |
Service cost | 561 | $ 531 |
Accounting Standards Update (“ASU”) No. 2014-09 | ||
Recent Accounting Pronouncements | ||
Adjustment to retained earnings | 400 | |
Accounting Standards Update (“ASU”) No. 2014-09 | Minimum | ||
Recent Accounting Pronouncements | ||
Expected impact to revenue | 2,000 | |
Accounting Standards Update (“ASU”) No. 2014-09 | Maximum | ||
Recent Accounting Pronouncements | ||
Expected impact to revenue | $ 4,000 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent $ in Thousands | Feb. 05, 2018USD ($)segment |
Interest rate swap | |
Subsequent Events | |
Number of agreements | segment | 2 |
Interest rate swap effective December 31, 2018 through June 30, 2021 | Cash flow hedges | |
Subsequent Events | |
Notional amount | $ 50,000 |
Interest rate | 2.613% |
Interest rate swap effective June 30, 2021 through December 10, 2021 | Cash flow hedges | |
Subsequent Events | |
Notional amount | $ 150,000 |
Interest rate | 2.793% |