Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Sep. 30, 2017 | Oct. 20, 2017 | |
Entity Listings [Line Items] | ||
Entity Registrant Name | Thermon Group Holdings, Inc. | |
Entity Central Index Key | 1,489,096 | |
Current Fiscal Year End Date | --03-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 32,439,865 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2017 | Mar. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 83,378 | $ 42,842 |
Investments | 5,066 | 44,786 |
Accounts receivable, net of allowance for doubtful accounts of $660 and $518 as of September 30, 2017 and March 31, 2017, respectively | 55,923 | 63,719 |
Inventories, net | 43,490 | 34,020 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 10,322 | 4,973 |
Prepaid expenses and other current assets | 7,845 | 5,806 |
Income tax receivable | 3,001 | 2,028 |
Total current assets | 209,025 | 198,174 |
Property, plant and equipment, net | 44,806 | 43,266 |
Goodwill | 127,205 | 122,521 |
Intangible assets, net | 82,946 | 86,178 |
Deferred income taxes | 2,766 | 2,823 |
Other long term assets | 991 | 1,118 |
Total assets | 467,739 | 454,080 |
Current liabilities: | ||
Accounts payable | 18,337 | 15,683 |
Accrued liabilities | 12,438 | 13,142 |
Current portion of long term debt | 20,250 | 20,250 |
Billings in excess of costs and estimated earnings on uncompleted contracts | 4,174 | 2,767 |
Income taxes payable | 892 | 481 |
Total current liabilities | 56,091 | 52,323 |
Long-term debt, net of current maturities and deferred debt issuance costs of $363 and $524 as of September 30, 2017 and March 31, 2017, respectively | 50,262 | 60,226 |
Deferred income taxes | 24,863 | 25,661 |
Other noncurrent liabilities | 3,653 | 3,368 |
Total liabilities | 134,869 | 141,578 |
Equity | ||
Common stock: $.001 par value; 150,000,000 authorized; 32,434,909 and 32,365,553 shares issued and outstanding at September 30, 2017 and March 31, 2017, respectively | 32 | 32 |
Preferred stock: $.001 par value; 10,000,000 authorized; no shares issued and outstanding | 0 | 0 |
Additional paid in capital | 220,578 | 219,284 |
Accumulated other comprehensive loss | (35,053) | (48,335) |
Retained earnings | 142,156 | 136,899 |
Total Thermon Group Holdings, Inc. shareholders' equity | 327,713 | 307,880 |
Non-controlling interests | 5,157 | 4,622 |
Total equity | 332,870 | 312,502 |
Total liabilities and equity | $ 467,739 | $ 454,080 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2017 | Mar. 31, 2017 |
Debt issuance costs, net | $ 363 | $ 524 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 32,434,909 | 32,365,553 |
Common stock, shares outstanding | 32,434,909 | 32,365,553 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Treasury Stock, Shares | 0 | 0 |
Thermon Holding Corp. | ||
Accounts receivable, allowance for doubtful accounts (in dollars) | $ 660 | $ 518 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Statement [Abstract] | ||||
Sales | $ 61,631 | $ 68,812 | $ 113,367 | $ 132,208 |
Cost of sales | 30,671 | 39,888 | 58,593 | 77,170 |
Gross profit | 30,960 | 28,924 | 54,774 | 55,038 |
Operating expenses: | ||||
Marketing, general and administrative and engineering | 20,521 | 20,224 | 39,838 | 39,332 |
Amortization of intangible assets | 3,022 | 3,025 | 5,961 | 5,841 |
Income from operations | 7,417 | 5,675 | 8,975 | 9,865 |
Other income/(expenses): | ||||
Interest income | 239 | 129 | 392 | 235 |
Interest expense | (787) | (895) | (1,589) | (1,809) |
Other income | (103) | (427) | (71) | (150) |
Income before provision for income taxes | 6,766 | 4,482 | 7,707 | 8,141 |
Income tax expense | 1,688 | 808 | 1,915 | 1,823 |
Net income | 5,078 | 3,674 | 5,792 | 6,318 |
Income attributable to non-controlling interests | 300 | 168 | 535 | 286 |
Net income available to Thermon Group Holdings, Inc. | 4,778 | 3,506 | 5,257 | 6,032 |
Comprehensive income: | ||||
Net income available to Thermon Group Holdings, Inc. | 4,778 | 3,506 | 5,257 | 6,032 |
Foreign currency translation adjustment | 7,563 | (678) | 13,281 | (860) |
Derivative valuation, net of tax | 9 | 290 | 7 | 160 |
Comprehensive income | $ 12,350 | $ 3,118 | $ 18,545 | $ 5,332 |
Net Income per common share: | ||||
Basic (in dollars per share) | $ 0.15 | $ 0.11 | $ 0.16 | $ 0.19 |
Diluted (in dollars per share) | $ 0.15 | $ 0.11 | $ 0.16 | $ 0.19 |
Weighted-average shares used in computing net income per common share: | ||||
Basic (in shares) | 32,408,143 | 32,278,361 | 32,412,819 | 32,255,476 |
Diluted (in shares) | 32,789,521 | 32,610,935 | 32,717,375 | 32,580,288 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Operating activities | ||
Net income | $ 5,792 | $ 6,318 |
Adjustment to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 9,544 | 8,754 |
Amortization of deferred debt issuance costs | 174 | 202 |
Stock compensation expense | 1,732 | 1,821 |
Deferred income taxes | (1,195) | (1,932) |
Other | 122 | (84) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 9,433 | 1,210 |
Inventories | (8,418) | 677 |
Costs and estimated earnings in excess of billings on uncompleted contracts | (5,783) | (1,461) |
Other current and noncurrent assets | (3,301) | (403) |
Accounts payable | 3,733 | (3,250) |
Accrued liabilities and noncurrent liabilities | 539 | (5,252) |
Income taxes payable and receivable | 171 | (4,380) |
Net cash provided by operating activities | 12,543 | 2,220 |
Investing activities | ||
Purchases of property, plant and equipment | (4,887) | (3,814) |
Sale of rental equipment at net book value | 169 | 229 |
Proceeds from sale of property, plant and equipment | 8 | 811 |
Purchases of investments | (8,283) | 0 |
Proceeds from the sale of investments | 49,310 | 0 |
Net cash provided by (used in) investing activities | 36,317 | (2,774) |
Financing activities | ||
Proceeds from revolving credit facility | 4,000 | 0 |
Payments on long term debt and revolving credit facility | (14,125) | (6,750) |
Proceeds from exercise of stock options | 106 | 67 |
Repurchase of employee stock units on vesting | (463) | (561) |
Lease financing | (125) | (111) |
Net cash used in financing activities | (10,607) | (7,355) |
Effect of exchange rate changes on cash and cash equivalents | 2,283 | (91) |
Change in cash and cash equivalents | 40,536 | (8,000) |
Cash and cash equivalents at beginning of period | 42,842 | 84,570 |
Cash and cash equivalents at end of period | $ 83,378 | $ 76,570 |
Basis of Presentation and Accou
Basis of Presentation and Accounting Policy Information | 6 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Accounting Policy Information | Basis of Presentation and Accounting Policy Information Thermon Group Holdings, Inc. and its direct and indirect subsidiaries are referred to collectively as “we,” “our,” or the “Company” herein. We are a provider of highly engineered industrial process heating solutions for process industries. Our core thermal solutions product - also referred to as heat tracing - provides an external heat source to pipes, vessels and instruments for the purposes of freeze protection, temperature and flow maintenance, environmental monitoring, and surface snow and ice melting. As a manufacturer, we provide a suite of products (heating cables, tubing bundles and control systems) and services (design optimization, engineering, installation and maintenance services) required to deliver comprehensive solutions to complex projects. In addition to our thermal solution offerings, we offer temporary power products that are designed to provide a safe and efficient means of supplying temporary electrical power distribution and lighting at energy infrastructure facilities for new construction and during maintenance and turnaround projects at operating facilities. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto for the year ended March 31, 2017 . In our opinion, the accompanying consolidated financial statements reflect all adjustments (consisting only of normal recurring items) considered necessary to present fairly our financial position at September 30, 2017 and March 31, 2017 , and the results of our operations for the three and six months ended September 30, 2017 and 2016 . Use of Estimates Generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. While our management has based their assumptions and estimates on the facts and circumstances existing at September 30, 2017 , actual results could differ from those estimates and affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities and the corresponding revenues and expenses as of the date of the financial statements. The operating results for the three and six months ended September 30, 2017 are not necessarily indicative of the results that may be achieved for the fiscal year ending March 31, 2018 . Reclassifications Certain reclassifications have been made within these consolidated financial statements to conform prior periods to current period classifications. On the consolidated balance sheet at March 31, 2017, we reduced the previously reported balance of prepaid expenses and other current assets by $2,000 and increased income tax receivable by the same amount. The income tax receivable amounts relate to tax payments or accruals made currently, which have not been included in tax returns filed within their respective jurisdictions. The Company believes that presenting these amounts as current income tax receivables provides a better understanding of our position related to taxation obligations . Subsequent Events On October 3, 2017, 2071827 Alberta Ltd. ("MergerSub"), a newly created, indirect and wholly-owned subsidiary of the Company, entered into Definitive Agreements (as defined below) to purchase 100% of the equity interests of CCI Thermal Technologies Inc. ("CCI") and certain related real estate assets (collectively, the "CCI Acquisition"). CCI is engaged in industrial process heating, focused on the development and production of advanced heating and filtration solutions for industrial and hazardous area applications and is headquartered in Edmonton, Alberta. The Company's Board of Directors unanimously approved the Definitive Agreements and the other transactions contemplated by the Definitive Agreements. The total cash consideration to be paid upon closing of the CCI Acquisition (the "Closing") is $258.0 million CAD (approximately $206.4 million USD at the exchange rate as of October 4, 2017), $204.0 million CAD of which will be paid by MergerSub for approximately 89.9% of the equity interests of CCI pursuant to that certain share purchase agreement dated October 3, 2017 (the "Share Purchase Agreement") among MergerSub, Camary Holdings, Ltd. ("Camary") and Rocor Holdings, Ltd. ("Rocor"), and $23.0 million CAD of which will be paid by MergerSub at Closing for the remaining 10.1% of the equity interests of CCI pursuant to certain employee share purchase agreements dated October 3, 2017 (the "Employee Share Agreements" and, together with the Share Purchase Agreement, the "Definitive Agreements") among MergerSub and certain current and former employee shareholders of CCI ("Employee Shareholders"). These amounts are subject to customary purchase price adjustments, including a working capital adjustment. In a separate but related transaction, MergerSub will pay $31.0 million CAD to Whitemud Place Properties Inc. at Closing for three parcels of real estate currently being used in the operation of CCI's business in Canada. The CCI Acquisition is expected to close in the Company's third fiscal quarter, subject to the satisfaction or waiver of certain customary closing conditions. MergerSub and CCI will amalgamate immediately following the Closing. The Definitive Agreements provide for customary representations, warranties, covenants, indemnifications and agreements, including, among others, that all parties will use commercially reasonable efforts to complete the CCI Acquisition and that CCI will conduct its business in the ordinary course consistent with past practice during the period between the execution of the Definitive Agreements and the Closing. The post-closing liabilities of Camary, Rocor and the Employee Shareholders have been limited pursuant to the terms of the Definitive Agreements. Breaches of certain representations and warranties by Camary and Rocor are expected to be insured under an insurance policy. In addition, pursuant to the share purchase agreement, MergerSub paid a $5.0 million CAD cash deposit (the "Deposit") upon execution of the Definitive Agreements to be held in escrow until the earlier of Closing or forfeiture by the Company. The Deposit will be fully applied to the purchase price payable at Closing. The Deposit will become non-refundable to the Company on or about October 30, 2017 if the CCI Acquisition fails to close due to insufficient financing. The transaction will be financed with a combination of cash on hand and a new senior secured debt facility. Concurrently and in connection with the execution of the Definitive Agreements, Thermon Industries, Inc., a wholly owned subsidiary of the Company, entered into a commitment letter dated October 3, 2017 (the “Debt Commitment Letter”) with JPMorgan Chase Bank, N.A. ("JPMorgan") whereby JPMorgan committed to provide debt financing for the CCI Acquisition consisting of a $250.0 million USD senior secured term loan B facility (the "Term Facility") and a senior secured revolving credit facility in an aggregate amount of $60.0 million USD (the "Revolving Facility," and together with the Term Facility, the "Facilities"). The obligation of JPMorgan to provide debt financing under the Debt Commitment Letter is subject to a number of customary conditions set forth in the Debt Commitment Letter, including, without limitation, execution and delivery by the borrowers and the guarantors of definitive credit agreement documentation consistent with the terms set forth in the Debt Commitment Letter. The Company intends to use part of the loan proceeds to refinance its existing term loan facility as well as complete the CCI Acquisition and pay certain related fees and associated expenses. The Company intends to hedge the foreign currency exposure associated with the CCI Acquisition's Canadian dollar denominated purchase price and has entered into non-designated option contracts with a notional value of $200.0 million CAD at a weighted average strike price of 1.244 Canadian dollars per US dollar. These option contracts will expire on October 30, 2017. Recent Accounting Pronouncements Revenue Recognition - In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2014-09 "Revenue from Contracts with Customers" (Topic 606), which amends the existing revenue recognition requirements and guidance. Under the new guidance, revenue is recognized when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. The new revenue standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. To assess the impact of the standard, we utilize internal resources to lead the implementation effort and supplement them with an independent external resource. As of the second quarter of fiscal 2018, the Company, after engaging an independent external firm to assist, selected a sample of customer contracts that we believe fairly represent specifically identified contract traits that could be accounted for differently under amended guidance. In performing the contract review, we will be evaluating the potential impacts of the new revenue standard on the recognition and classification of contract revenue and the potential capitalization of contract costs. The contract reviews are currently in process and we anticipate the comprehensive review of the sample contracts to be completed by the end of the third quarter of fiscal 2018. After this work is complete, we believe we will have identified all material contract types and costs that may be impacted by this amended guidance. The Company is currently planning to adopt the amended guidance using the modified retrospective method as of April 1, 2018. Stock Compensation - In March 2016, the FASB issued Accounting Standards Update 2016-09 “Compensation-Stock Compensation” (Topic 718), which changes the accounting for certain aspects of share-based payments to employees. The new guidance requires excess tax benefits and tax deficiencies to be recorded in the income statement when the awards vest or are settled. Additionally, cash flows related to excess tax benefits will no longer be separately classified as a financing activity and will be included as an operating activity on the consolidated statements of cash flows. The guidance allows for an accounting policy election to account for forfeitures as they occur. The standard is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. We adopted this standard effective April 1, 2017 and it did not have a material impact on our consolidated financial statements. Inventory- In July 2015, the FASB issued Accounting Standards Update 2015-11 “Simplifying the Measurement of Inventory” (Topic 330). Under the new guidance, inventory is measured at the lower of cost and net realizable value, and the new guidance eliminates the use of replacement cost and net realizable value less a normal profit margin as techniques to value inventory. Net realizable value is defined as the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The new guidance will be applied prospectively for annual periods and interim periods within fiscal years beginning after December 15, 2016. We adopted this standard effective April 1, 2017 and it did not have a material impact on our consolidated financial statements. Financial Instruments- In January 2016, the FASB issued Accounting Standards Update 2016-01 “Financial Instruments-Overall” (Subtopic 825-10), which amends the guidance on the classification and measurement of financial instruments. The amendment requires all equity investments to be measured at fair value with changes in the fair value recognized through earnings. The amendment also requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the credit risk when an entity has elected the fair value option. The guidance eliminates the requirement to disclose the methods and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet. The new guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2017. Early adoption is permitted for certain provisions of the accounting standards update. Upon adoption of the standard, an entity will be required to make a cumulative-effect adjustment to retained earnings as of the beginning of such reporting period. We are currently evaluating when to adopt this standard. Upon adoption, we do not anticipate this standard will have a material impact on our consolidated financial statements. Leases - In February 2016, the FASB issued Accounting Standards Update 2016-02 “Leases” (Topic 842), which provides guidance on the recognition, measurement, presentation and disclosure on leases. Under the standard, substantially all leases will be reported on the balance sheet as right-of-use assets and lease liabilities. The new guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2018. Early adoption is permitted. We are currently evaluating the requirements of the standard and have not yet determined its impact on our consolidated financial statements. Financial Instruments- In June 2016, the FASB issued Accounting Standards Update 2016-13 “Financial Instruments-Credit Losses” (Topic 326), which amends the guidance on the impairment of financial instruments. The standard adds an impairment model, referred to as current expected credit loss, which is based on expected losses rather than incurred losses. The standard applies to most debt instruments, trade receivables, lease receivables, reinsurance receivables, financial guarantees and loan commitments. Under the guidance, companies are required to disclose credit quality indicators disaggregated by year of origination for a five-year period. The new guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2019. We do not anticipate this will have a material impact to our consolidated financial statements. Statement of Cash Flows- In August 2016, the FASB issued Accounting Standards Update 2016-15 “Statement of Cash Flows” (Topic 230), which amends Topic 230 of the accounting standards codification (ASC) to add or clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows. The standard addresses eight types of cash flows, some of which we believe could or will impact our financial statements upon adoption, including debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, and proceeds from the settlement of insurance claims. Under the guidance, cash payments for debt prepayment or extinguishment costs must be classified as cash outflows from financing activities. Contingent consideration payments that were not made soon after a business combination must be separated and classified in operating and financing activities. Cash payments up to the amount of the contingent consideration liability recognized as of the acquisition dates, including any measurement-period adjustments, should be classified in financing activities, while any excess cash payments should be classified in operating activities. Cash proceeds from the settlement of insurance claims should be classified on the basis of the nature of the loss. The guidance is effective for fiscal years beginning after December 15, 2017, including interim periods within those years. Early adoption is permitted for all entities. Entities must apply the guidance retrospectively to all periods presented but may be applied prospectively if retrospective application would be impracticable. We do not anticipate this will have a material impact to our consolidated financial statements. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair Value . We measure fair value based on authoritative accounting guidance, which defines fair value, establishes a framework for measuring fair value and expands on required disclosures regarding fair value measurements. Inputs are referred to as assumptions that market participants would use in pricing the asset or liability. The uses of inputs in the valuation process are categorized into a three-level fair value hierarchy. • Level 1 — uses quoted prices in active markets for identical assets or liabilities we have the ability to access. • Level 2 — uses observable inputs other than quoted prices in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. • Level 3 — uses one or more significant inputs that are unobservable and supported by little or no market activity, and that reflect the use of significant management judgment. Financial assets and liabilities with carrying amounts approximating fair value include cash, trade accounts receivable, accounts payable, accrued expenses and other current liabilities. The carrying amount of these financial assets and liabilities approximates fair value because of their short maturities. At September 30, 2017 and March 31, 2017 , no assets or liabilities were valued using Level 3 criteria. Information about our investments and long-term debt that is not measured at fair value is as follows: September 30, 2017 March 31, 2017 Carrying Value Fair Value Carrying Value Fair Value Valuation Technique Financial Assets Certificates of deposits with maturities greater than 90 days $ 5,066 $ 5,066 $ 44,786 $ 44,786 Level 2 - Market Approach Financial Liabilities Outstanding principal amount of senior secured credit facility $ 70,875 $ 70,875 $ 81,000 $ 81,000 Level 2 - Market Approach At September 30, 2017 and March 31, 2017 , the fair value of our variable rate term loan approximates its carrying value as we pay interest based on the current market rate. As the quoted price is only available for similar financial assets, the Company concluded the pricing is indirectly observable through dealers and has been classified as Level 2. Investments At September 30, 2017 and March 31, 2017 , the Company maintained $5,066 and $44,786 , respectively, of term deposit accounts at several foreign financial institutions with whom we have an established relationship. Maturities on these deposits are greater than 90 days and less than one year and accordingly are classified as investments. The Company concluded that since the interest rates for these term deposits are based on the quoted rates from the various financial institutions that the pricing is indirectly observable and has been classified as a Level 2 market approach. Foreign Currency Forward Contracts We transact business in various foreign currencies and have established a program that primarily utilizes foreign currency forward contracts to offset the risk associated with the effects of certain foreign currency exposures. Under this program, increases or decreases in our foreign currency exposures are offset by gains or losses on the forward contracts to mitigate foreign currency transaction gains or losses. These foreign currency exposures arise from intercompany transactions as well as third party accounts receivable or payable that are denominated in foreign currencies. Our forward contracts generally have terms of 30 days. We do not use forward contracts for trading purposes or designate these forward contracts as hedging instruments pursuant to ASC 815. We adjust the carrying amount of all contracts to their fair value at the end of each reporting period and unrealized gains and losses are included in our results of operations for that period. These gains and losses are designed to offset gains and losses resulting from settlement of receivables or payables by our foreign operations which are settled in currency other than the local transactional currency. The fair value is determined by quoted prices from active foreign currency markets (Level 2). The condensed consolidated balance sheets reflect unrealized gains within accounts receivable, net and unrealized losses within accrued liabilities. Our ultimate realized gain or loss with respect to currency fluctuations will depend on the currency exchange rates and other factors in effect as the contracts mature. As of September 30, 2017 and March 31, 2017 , the notional amounts of forward contracts were as follows: Notional amount of foreign currency forward contracts by currency September 30, 2017 March 31, 2017 Russian Ruble $ 2,000 $ 250 Euro 500 — South Korean Won 2,000 1,300 Mexican Peso 450 450 Australian Dollar 500 375 Total notional amounts $ 5,450 $ 2,375 The following table represents the fair value of our foreign currency forward contracts: September 30, 2017 March 31, 2017 Fair Value Fair Value Assets Liabilities Assets Liabilities Foreign currency forward contracts $ — $ 61 $ 62 $ 10 Foreign currency gains or losses related to our forward contracts in the accompanying condensed consolidated statements of operations and comprehensive income were losses of $85 and $16 in the three months ended September 30, 2017 and 2016 , respectively, and losses of $132 and $146 for six months ended September 30, 2017 and 2016 . Gains and losses from our forward contracts were offset by transaction gains or losses incurred with the settlement of transactions denominated in foreign currencies. For the three months ended September 30, 2017 and 2016 , our net foreign currency transactions were losses of $135 and $367 , respectively, and losses of $115 and $399 for six months ended September 30, 2017 and 2016 , respectively. All outstanding foreign currency forward contracts are marked to market at the end of the period with unrealized gains and losses included in other income and expense, within our condensed consolidated statements of operations and comprehensive income. Interest Rate Swaps The Company has entered into two interest rate swap contracts to reduce the exposure to interest rate fluctuations associated with its variable rate term loan. Under the swap agreements, we pay a fixed amount and receive payments based on a variable rate. The Company designated the interest rate swap contracts as cash flow hedges pursuant to ASC 815. The Company formally documents all relationships between the hedging instrument and hedged item, its risk management objective and strategy, as well as counterparty creditworthiness. At each reporting period our interest rate swap contracts are adjusted to fair value based on dealer quotes, which consider forward yield curves and volatility levels (Level 2). Unrealized gains, representing derivative assets, are reported within accounts receivable, net and unrealized losses, representing derivative liabilities, are reported within accrued liabilities on the accompanying condensed consolidated balance sheets. As of September 30, 2017 and March 31, 2017 , the fair values of the interest rate swap contracts were unrealized losses of $17 and $5 , respectively. The change in fair value of the derivative instruments is recorded in accumulated other comprehensive income to the extent the derivative instruments are deemed effective. Ineffectiveness is measured based on the changes in fair value of the interest rate swap contracts and the change in fair value of the hypothetical derivative and is recognized in earnings in the period in which ineffectiveness is realized. Based on the criteria established by ASC 815, the interest rate swap contracts are deemed to be highly effective. Any realized gains or losses resulting from the interest rate swap contracts are recognized within interest expense. Gains and losses from our interest rate swap contract are offset by changes in the variable interest rate on our term loan. During the three months ended September 30, 2017 , our interest rate on outstanding principal amounts averaged approximately 3.42% . As of September 30, 2017 , 100% of our interest payments on our variable rate term loan are hedged through its maturity in April 2019. The following table summarizes the aggregate unrealized loss in accumulated other comprehensive loss, and the losses reclassified into earnings for the three months ended September 30, 2017 and 2016 : Three months ended September 30, 2017 Three Months Ended September 30, 2016 Before Tax Amount Tax Expense (Benefit) Other Comprehensive loss, net Before Tax Amount Tax Expense (Benefit) Other Comprehensive loss, net Unrealized loss at beginning of the period $ (56 ) $ (20 ) $ (36 ) $ (1,470 ) $ (514 ) $ (956 ) Add: gain from change in fair value of cash flow hedge 16 5 11 294 102 192 Less: gain (loss) reclassified into earnings from effective hedge 13 4 9 (142 ) (50 ) (92 ) Less: ineffective portion of hedge transferred into earnings (11 ) (4 ) (7 ) (11 ) (4 ) (7 ) Unrealized loss at end of the period $ (42 ) $ (15 ) $ (27 ) $ (1,023 ) $ (358 ) $ (665 ) Six Months Ended September 30, 2017 Six Months Ended September 30, 2016 Before Tax Amount Tax Expense (Benefit) Other Comprehensive loss, net Before Tax Amount Tax Expense (Benefit) Other Comprehensive loss, net Unrealized loss at beginning of the period $ (53 ) $ (19 ) $ (34 ) $ (1,269 ) $ (444 ) $ (825 ) Add: loss from change in fair value of cash flow hedge (30 ) (11 ) (19 ) (75 ) (27 ) (48 ) Less: loss reclassified into earnings from effective hedge (19 ) (7 ) (12 ) (299 ) (105 ) (194 ) Less: ineffective portion of hedge transferred into earnings (22 ) (8 ) (14 ) (22 ) (8 ) (14 ) Unrealized loss at end of the period $ (42 ) $ (15 ) $ (27 ) $ (1,023 ) $ (358 ) $ (665 ) Transfers out of accumulated other comprehensive loss During the three and six months ended September 30, 2017 and 2016 , there were no transfers out of accumulated other comprehensive loss except for realized losses from our interest rate swap contract presented in the preceding tables, which were recorded within interest expense in our statements of operations and comprehensive income. |
Net Income per Common Share
Net Income per Common Share | 6 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Net Income per Common Share | Net Income per Common Share Basic net income per common share is computed by dividing net income available to Thermon Group Holdings, Inc. by the weighted average number of common shares outstanding during each period. Diluted net income per common share is computed by dividing net income available to Thermon Group Holdings, Inc. by the weighted average number of common shares and common share equivalents outstanding (if dilutive) during each period. The number of common share equivalents, which includes options and both restricted and performance stock units, is computed using the treasury stock method. With regard to the performance stock units, we assumed that the associated performance targets will be met at the target level of performance for purposes of calculating diluted net income per common share. The reconciliations of the denominators used to calculate basic and diluted net income per common share for the three and six months ended September 30, 2017 and 2016 , respectively, are as follows: Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 Six Months Ended September 30, 2017 Six Months Ended September 30, 2016 Basic net income per common share Net income available to Thermon Group Holdings, Inc. $ 4,778 $ 3,506 $ 5,257 $ 6,032 Weighted-average common shares outstanding 32,408,143 32,278,361 32,412,819 32,255,476 Basic net income per common share $ 0.15 $ 0.11 $ 0.16 $ 0.19 Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 Six Months Ended September 30, 2017 Six Months Ended September 30, 2016 Diluted net income per common share Net income available to Thermon Group Holdings, Inc. $ 4,778 $ 3,506 $ 5,257 $ 6,032 Weighted-average common shares outstanding 32,408,143 32,278,361 32,412,819 32,255,476 Common share equivalents: Stock options 192,179 224,795 197,734 226,396 Restricted and performance stock units 189,199 107,779 106,822 98,416 Weighted average shares outstanding – dilutive (1) 32,789,521 32,610,935 32,717,375 32,580,288 Diluted net income per common share $ 0.15 $ 0.11 $ 0.16 $ 0.19 (1) For the three and six months ended September 30, 2017 , 52,252 and 47,999 equity awards, respectively, were not included in the calculation of diluted net income per common share, as they would have had an anti-dilutive effect. For the three and six months ended September 30, 2016 , 68,736 and 70,799 equity awards, respectively, were not included in the calculation of diluted net income per common share, as they would have had an anti-dilutive effect. |
Inventories
Inventories | 6 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following: September 30, March 31, Raw materials $ 17,580 $ 12,270 Work in process 2,685 1,769 Finished goods 24,797 21,310 45,062 35,349 Valuation reserves (1,572 ) (1,329 ) Inventories, net $ 43,490 $ 34,020 |
Goodwill
Goodwill | 6 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill The carrying amount of goodwill by operating segment as of September 30, 2017 is as follows: United States Canada Europe Asia Total Balance as of March 31, 2017 $ 52,016 $ 43,444 $ 18,437 $ 8,624 $ 122,521 Foreign currency translation impact — 2,851 1,833 — 4,684 Balance as of September 30, 2017 $ 52,016 $ 46,295 $ 20,270 $ 8,624 $ 127,205 Goodwill is tested for impairment on an annual basis, and between annual tests if indicators of potential impairment exist. We perform a qualitative analysis to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If required, we also perform a quantitative analysis using the income approach, based on discounted future cash flows, which are derived from internal forecasts and economic expectations, and the market approach based on market multiples of guideline public companies. The most significant inputs in the Company's quantitative goodwill impairment tests are projected financial information, the weighted average cost of capital and market multiples for similar transactions. Our annual impairment test is performed during the fourth quarter of our fiscal year. In prior years, we experienced sizable declines in revenue and operating results within our Canadian operations, and considered such to be an indication of potential goodwill and intangible asset impairment. These declines in operating results principally resulted from lower crude oil prices, which had a significant adverse impact on capital spending in Canada. During fiscal year 2018, we have experienced increased revenues and operating results in Canada, and project continued growth. Accordingly, during the second quarter of 2018, we did not conclude a triggering event existed within our Canadian reporting units requiring further analysis. We will continue to evaluate our Canadian operations and assess on a quarterly basis whether it is more likely than not that the fair value of the Canadian reporting unit is less than its carrying amount. Similarly, based upon our qualitative analyses, we have not determined that it is more likely than not that the fair value of our U.S. reporting unit is less than its carrying amount; however, we have experienced losses in the U.S. for each of the first two quarters of 2018. If changes in estimates and assumptions used to determine whether impairment exists, or if we experience future declines in actual and forecasted operating results and/or market conditions in the United States, we may be required to reevaluate the fair value of our United States reporting unit, which could ultimately result in an impairment to goodwill and/or indefinite-lived intangible assets in future periods. Our total intangible assets consisted of the following: Gross Carrying Amount at September 30, 2017 Accumulated Amortization Net Carrying Amount at September 30, 2017 Gross Carrying Amount at March 31, 2017 Accumulated Amortization Net Carrying Amount at March 31, 2017 Trademarks $ 46,152 $ 657 $ 45,495 $ 44,563 $ 521 $ 44,042 Developed technology 10,159 3,844 6,315 9,796 3,454 6,342 Customer relationships 102,660 72,206 30,454 99,676 64,682 34,994 Certifications 458 — 458 442 — 442 Other 2,639 2,415 224 2,626 2,268 358 Total $ 162,068 $ 79,122 $ 82,946 $ 157,103 $ 70,925 $ 86,178 |
Accrued Liabilities
Accrued Liabilities | 6 Months Ended |
Sep. 30, 2017 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued Liabilities Accrued current liabilities consisted of the following: September 30, March 31, Accrued employee compensation and related expenses $ 7,942 $ 8,364 Customer prepayment 421 168 Warranty reserve 321 300 Professional fees 1,813 1,631 Sales tax payable 1,551 1,573 Other 390 1,106 Total accrued current liabilities $ 12,438 $ 13,142 |
Short-Term Revolving Credit Fac
Short-Term Revolving Credit Facilities | 6 Months Ended |
Sep. 30, 2017 | |
Short-term Debt [Abstract] | |
Short-Term Revolving Credit Facilities | Short-Term Revolving Credit Facilities The Company’s subsidiary in the Netherlands has a revolving credit facility in the amount of Euro 4,000 (equivalent to $4,721 at September 30, 2017 ). The facility is collateralized by such subsidiary's receivables, inventory, equipment, furniture and real estate. No amounts were outstanding under this facility at September 30, 2017 or March 31, 2017 . The Company’s subsidiary in India has a revolving credit facility in the amount of 80,000 Rupees (equivalent to $1,224 at September 30, 2017 ). The facility is collateralized by such subsidiary's receivables, inventory, real estate, a letter of credit and cash. No amounts were outstanding under this facility at September 30, 2017 or March 31, 2017 . The Company’s subsidiary in Australia has a revolving credit facility in the amount of $230 Australian Dollars (equivalent to $180 at September 30, 2017 ). The facility is collateralized by such subsidiary's real estate. No amounts were outstanding under this facility at September 30, 2017 or March 31, 2017 . Under the Company’s senior secured revolving credit facility described below in Note 8, “Long-Term Debt,” there were no outstanding borrowings at September 30, 2017 or March 31, 2017 . During the three and six months ended September 30, 2017 , the Company had $4.0 million in borrowings from the revolving credit facility. All subsequent revolving credit facility borrowings were repaid in full by the end of the reporting period. |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt consisted of the following: September 30, March 31, Variable Rate Term Loan, due April 2019, net of deferred debt issuance costs of $363 and $524 as of September 30, 2017 and March 31, 2017, respectively $ 70,512 $ 80,476 Less current portion (20,250 ) (20,250 ) Total long-term debt $ 50,262 $ 60,226 Senior Secured Credit Facility In April 2013, we entered into an amended and restated credit agreement that provided for a $135,000 variable rate term loan and $60,000 senior secured asset-based revolving credit facility, which we refer to collectively as our “credit facility.” We have entered into two amendments to our credit facility, most recently in August 2015 (the “Amendment”). The maturity date of our credit facility is April 19, 2019. Under the Amendment, the fixed portion of our interest rate, which is dictated by our leverage ratio, was reduced by 0.25% and our fee on undrawn amounts on our senior secured revolving credit facility was reduced by 0.05% . The maximum leverage ratio permitted for each fiscal quarter remained at 2.75 to 1.0 . In connection with the Amendment, we incurred $341 of fees, which were deferred and are recognized as interest expense over the life of the credit facility. Under our credit facility, in no case shall availability exceed commitments thereunder. Any credit facility borrowings will bear interest, at our option, at a rate equal to either (i) a base rate determined by reference to the greatest of (a) JPMorgan Chase Bank's prime rate in New York City, (b) the federal funds effective rate in effect on such day plus ½ of 1% and (c) the adjusted LIBOR rate for a one month interest period on such day plus 1%, in each case plus an applicable margin dictated by our leverage ratio, or (ii) the LIBOR rate, plus an applicable margin dictated by our leverage ratio. Borrowings denominated in Canadian Dollars under the Canadian sub-facility bear interest at our option, at a rate equal to either (i) a base rate determined by reference to the greater of (a) JPMorgan Chase Bank, Toronto branch's prime rate and (b) the sum of (x) the yearly interest rate to which the one-month Canadian deposit offered rate is equivalent plus (y) 1.0%, in each case plus an applicable margin dictated by our leverage ratio, or (ii) a Canadian deposit offered rate determined by the sum of (a) the annual rate of interest determined with reference to the arithmetic average of the discount rate quotations of all institutions listed in respect of the relevant period for Canadian dollar-denominated bankers' acceptances plus (b) 0.10% per annum, plus an applicable margin dictated by our leverage ratio. In addition to paying interest on outstanding borrowings under our credit facility, we are currently required to pay a 0.30% per annum commitment fee to the lenders in respect of the unutilized commitments thereunder, which commitment fee could change based on our leverage ratio, and letter of credit fees equal to the LIBOR margin or the Canadian deposit offered rate, as applicable, on the undrawn amount of all outstanding letters of credit, in addition to a 0.125% annual fronting fee. At September 30, 2017 , we had no outstanding borrowings under our senior secured revolving credit facility. The interest rate on borrowings during the three and six months ended September 30, 2017 was 5.50% . As of September 30, 2017 , we had $56,018 of capacity available under our senior secured revolving credit facility after taking into account the borrowing base and letters of credit outstanding. The variable rate term loan bears interest at the LIBOR rate plus an applicable margin dictated by our leverage ratio. As of September 30, 2017 , our interest rate was 3.50% . The term loan includes monthly principal payments of $1,688 through March 31, 2019. The remaining $40,500 is due at maturity in April 2019. As noted above in Note 1, “Basis of Presentation and Accounting Policy Information - Subsequent Events” in our financial statements, we expect to refinance our existing term loan with the new Term Facility borrowings upon closing of the CCI Acquisition. Interest rate swaps. The Company entered into two interest rate swap contracts to reduce the exposure to interest rate fluctuations associated with its variable rate secured term loan interest payments. Under the interest rate swap agreements, we pay a fixed amount and receive payments based on a variable interest rate. Under the terms of the Amendment and our interest rate swaps, our interest rate on outstanding principal amounts averaged approximately 3.42% during the three months ended September 30, 2017 . As of September 30, 2017 , 100% of our interest payments on our variable rate secured term loan are hedged through its maturity in April 2019. Guarantees; security. The obligations under our credit facility are guaranteed on a senior secured basis by each of our existing and future domestic restricted subsidiaries, including Thermon Industries, Inc., the U.S. borrower under our credit facility. The obligations under our credit facility are secured by a first priority perfected security interest in substantially all of our assets, subject to certain exceptions, permitted liens and encumbrances reasonably acceptable to the administrative agent under our credit facility. Restrictive covenants. The credit facility contains various restrictive covenants that, among other things, restrict or limit our ability to (subject to certain negotiated exceptions): incur additional indebtedness or issue disqualified capital stock unless certain financial tests are satisfied; pay dividends, redeem subordinated debt or make other restricted payments; make certain investments or acquisitions; issue stock of subsidiaries; grant or permit certain liens on our assets; enter into certain transactions with affiliates; merge, consolidate or transfer substantially all of our assets; incur dividend or other payment restrictions affecting certain of our subsidiaries; transfer or sell assets, including capital stock of our subsidiaries; and change the business we conduct. As of September 30, 2017 , we were in compliance with all financial covenants of the credit facility. |
Related-Party Transactions
Related-Party Transactions | 6 Months Ended |
Sep. 30, 2017 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Related-Party Transactions In connection with the Sumac transaction, one of the former Sumac principals retained 25% of the ownership of the Sumac business unit. This individual is employed by the Company and serves as the general manager of the Sumac business unit. During fiscal 2017, this individual, together with the two other former principals of Sumac, who are not employed by the Company were paid $5,805 in the aggregate in full satisfaction of the Company's obligations under the $5,905 non-interest bearing performance-based note issued in connection with the Sumac transaction. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies At September 30, 2017 , the Company had in place letter of credit guarantees and performance bonds securing performance obligations of the Company. These arrangements totaled approximately $15,701 . Of this amount, $1,802 is secured by cash deposits at the Company’s financial institutions and an additional $3,982 represents a reduction of the available amount of the Company's short-term and long-term revolving lines of credit. Included in prepaid expenses and other current assets at September 30, 2017 and March 31, 2017 was approximately $1,802 and $1,450 , respectively, of cash deposits pledged as collateral on performance bonds and letters of credit. Our Indian subsidiary also has $5,554 in customs bonds outstanding to secure the Company's customs and duties obligations in India. We are involved in various legal and administrative proceedings that arise from time to time in the ordinary course of doing business. Some of these proceedings may result in fines, penalties or judgments being assessed against us, which may adversely affect our financial results. In addition, from time to time, we are involved in various disputes, which may or may not be settled prior to legal proceedings being instituted and which may result in losses in excess of accrued liabilities, if any, relating to such unresolved disputes. Expenses related to litigation and other such proceedings or disputes reduce operating income. As of September 30, 2017 , management believes that adequate reserves have been established for any probable and reasonably estimable losses. We do not believe that the outcome of any of these proceedings or disputes would have a significant adverse effect on our financial position, long-term results of operations, or cash flows. It is possible, however, that charges related to these matters could be significant to our results of operations or cash flows in any one accounting period. The Company has no outstanding legal matters outside of matters arising in the ordinary course of business. We can give no assurances we will prevail in any of these matters. |
Stock-Based Compensation Expens
Stock-Based Compensation Expense | 6 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation Expense | Stock-Based Compensation Expense Our board of directors has adopted and the shareholders have approved two stock option award plans. The 2010 Thermon Group Holdings, Inc. Restricted Stock and Stock Option Plan (“2010 Plan”) was approved on July 28, 2010. The 2010 Plan authorized the issuance of 2,767,171 stock options or restricted shares (on a post-stock split basis). On April 8, 2011, the board of directors approved the Thermon Group Holdings, Inc. 2011 Long-Term Incentive Plan (“2011 LTIP”). The 2011 LTIP made available 2,893,341 shares of the Company’s common stock that may be awarded to employees, directors or non-employee contractors as compensation in the form of stock options, restricted stock awards or restricted stock units. At September 30, 2017 , there were 408,527 options outstanding. For the three months ended September 30, 2017 and 2016 , stock compensation expense was $947 and $915 , respectively, and $1,732 and $1,821 for the six months ended September 30, 2017 , and 2016 , respectively. During the six months ended September 30, 2017 , 104,962 restricted stock units were issued to our employees with an aggregate grant date fair value as determined by the closing price of our stock on the respective grant dates of $1,950 . The awards will be expensed on a straight-line basis over the three -year service period. At each anniversary of the restricted stock units' grant date, a proportionate number of stock units will become vested for the employees and the shares will become issued and outstanding. We maintain a plan to issue our directors awards of fully vested common stock every three months for a total award over a twelve-month period of approximately $420 . During the three and six months ended September 30, 2017 , 5,404 and 10,052 fully vested common shares, respectively, were issued in the aggregate to our directors. The aggregate grant date fair value as determined by the closing price of our common stock on the grant date was $105 and $201 , respectively, for the three and six months ended September 30, 2017 . The fair value of the awards is expensed on each grant date. During the six months ended September 30, 2017 , a target amount of 15,438 performance stock units were issued to certain members of our senior management that had a total grant date fair value of $340 . The performance indicator for these performance stock units is based on the market performance of our stock price, from the date of grant through March 31, 2020, relative to the market price performance of a pre-determined peer group of companies. Since the performance indicator is market-based, we used a Monte-Carlo valuation model to calculate the probable outcome of the performance measure to arrive at the fair value. The requisite service period required to earn the awards is through March 31, 2020. We will expense the fair value of the performance stock units over the service period on a straight-line basis whether or not the stock price performance condition is met. At the end of the performance period, the performance stock units will be evaluated with the requisite number of shares being issued. The possible number of shares that could be issued ranges from zero to 30,876 in the aggregate. Shares that are not awarded at the measurement date will be forfeited. In addition to the market-based performance stock units issued to certain members of senior management, we also granted these individuals, during the six months ended September 30, 2017 , a target amount of 58,246 performance stock units based on the Company's Adjusted EBITDA performance over a three -year period ending March 31, 2020. The total grant date fair value, as determined by the closing price of our common stock on the date of the grant, was $1,080 . At each reporting period, we will estimate how many awards senior management may achieve and adjust our stock compensation expense accordingly. At the end of the performance period, the performance stock units will be evaluated with the requisite number of shares issued. The possible number of shares that could be issued under such performance stock units ranges from zero to 116,492 in the aggregate. Shares that are not awarded after the end of the measurement period will be forfeited. |
Income Taxes
Income Taxes | 6 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For the six month periods ended September 30, 2017 and 2016 , the Company recorded tax expense of $1,915 on pre-tax income of $7,707 and tax expense of $1,823 on pre-tax income of $8,141 , respectively. Our anticipated annual effective tax rate is approximately 24.8% and has been applied to our consolidated pre-tax income for the six months ended September 30, 2017 . For the six months ended September 30, 2016 , our tax provision reflected an annual effective tax rate of 22.4% . We have adopted a permanent reinvestment position whereby we expect to reinvest our foreign earnings for most of our foreign subsidiaries and do not expect to repatriate future earnings. As a result of the adoption of a permanent reinvestment position, we do not accrue a tax liability in anticipation of future dividends from most of our foreign subsidiaries. The estimated annual effective tax rate for the fiscal year ending March 31, 2018 reflects the estimated taxable earnings of our various foreign subsidiaries and the applicable local tax rates, after accounting for certain permanent differences, such as non-deductible compensation expense. As of September 30, 2017 , we have established a long-term liability for uncertain tax positions in the amount of $543 , all of which is related to the IPI acquisition. We expect such long-term liability to be released as a discrete tax benefit during the three month period ending December 31, 2017 as the audit periods to which they relate will expire. During the six months ended September 30, 2017 , the Company recognized related accrued interest and penalties of $10 as income tax expense related to our current uncertain tax positions. As of September 30, 2017 , the tax years for fiscal 2014 through fiscal 2017 remain open to examination by the major taxing jurisdictions to which we are subject. |
Segment Information
Segment Information | 6 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information We operate in four reportable segments based on four geographic countries or regions in which we operate: the United States, Canada, Europe and Asia. Within our four reportable segments, our primary products and services are focused on thermal solutions primarily related to the electrical heat tracing industry. Each of our reportable segments serves a similar class of customers, including engineering, procurement and construction (“EPC”) companies, international and regional oil and gas companies, commercial sub-contractors, electrical component distributors and direct sales to existing plant or industrial applications. Profitability within our segments is measured by operating income. Profitability can vary in each of our reportable segments based on the competitive environment within the region, the level of corporate overhead, such as the salaries of our senior executives, and the level of research and development and marketing activities in the region, as well as the mix of products and services. Since March 2015, we acquired Unitemp, IPI and Sumac. Both Unitemp and IPI offer thermal solutions and have been included in our Europe and United States reportable segments, respectively. Sumac provides temporary power products that differ from our core thermal solutions business. As we anticipate that our full year operating results from Sumac will comprise less than 10% of our total sales and operating income, Sumac has been aggregated in our Canada segment. For purposes of this note, revenue is attributed to individual countries or regions on the basis of the physical location and jurisdiction of organization of the subsidiary that invoices the material and services. Total sales to external customers, inter-segment sales, depreciation expense, amortization expense, income from operations, property, plant and equipment, net and total assets for each of our four reportable segments are as follows: Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 Six Months Ended September 30, 2017 Six Months Ended September 30, 2016 Sales to External Customers: United States $ 21,318 $ 29,838 $ 44,869 $ 59,992 Canada 15,437 13,051 27,536 23,160 Europe 17,447 18,554 28,064 32,317 Asia 7,429 7,369 12,898 16,739 $ 61,631 $ 68,812 $ 113,367 $ 132,208 Inter-Segment Sales: United States $ 14,309 $ 13,096 $ 23,891 $ 23,735 Canada 1,895 436 3,359 1,025 Europe 362 405 723 1,006 Asia 174 505 547 633 $ 16,740 $ 14,442 $ 28,520 $ 26,399 Depreciation Expense: United States $ 1,078 $ 890 $ 2,064 $ 1,751 Canada 635 499 1,240 951 Europe 124 73 214 142 Asia 32 37 64 69 $ 1,869 $ 1,499 $ 3,582 $ 2,913 Amortization Expense: United States $ 1,505 $ 1,536 $ 3,010 $ 2,850 Canada 901 890 1,741 1,791 Europe 350 333 679 668 Asia 266 266 532 532 $ 3,022 $ 3,025 $ 5,962 $ 5,841 Income (loss) from operations: United States $ (1,050 ) $ 424 $ (2,097 ) $ 463 Canada 6,549 2,711 9,997 4,444 Europe 2,378 2,913 2,232 4,564 Asia 845 839 1,307 2,883 Unallocated: Stock compensation (947 ) (915 ) (1,732 ) (1,821 ) Public company costs (358 ) (297 ) (732 ) (668 ) $ 7,417 $ 5,675 $ 8,975 $ 9,865 September 30, 2017 March 31, 2017 Property, plant and equipment, net: United States $ 34,938 $ 34,563 Canada 5,796 4,674 Europe 3,572 3,532 Asia 500 497 $ 44,806 $ 43,266 Total Assets: United States $ 178,492 $ 186,300 Canada 152,944 136,688 Europe 85,868 80,589 Asia 50,435 50,503 $ 467,739 $ 454,080 |
Basis of Presentation and Acc19
Basis of Presentation and Accounting Policy Information (Policies) | 6 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of Estimates | Use of Estimates Generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. While our management has based their assumptions and estimates on the facts and circumstances existing at September 30, 2017 , actual results could differ from those estimates and affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities and the corresponding revenues and expenses as of the date of the financial statements. The operating results for the three and six months ended September 30, 2017 are not necessarily indicative of the results that may be achieved for the fiscal year ending March 31, 2018 . |
Reclassifications | Reclassifications Certain reclassifications have been made within these consolidated financial statements to conform prior periods to current period classifications. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Revenue Recognition - In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2014-09 "Revenue from Contracts with Customers" (Topic 606), which amends the existing revenue recognition requirements and guidance. Under the new guidance, revenue is recognized when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. The new revenue standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. To assess the impact of the standard, we utilize internal resources to lead the implementation effort and supplement them with an independent external resource. As of the second quarter of fiscal 2018, the Company, after engaging an independent external firm to assist, selected a sample of customer contracts that we believe fairly represent specifically identified contract traits that could be accounted for differently under amended guidance. In performing the contract review, we will be evaluating the potential impacts of the new revenue standard on the recognition and classification of contract revenue and the potential capitalization of contract costs. The contract reviews are currently in process and we anticipate the comprehensive review of the sample contracts to be completed by the end of the third quarter of fiscal 2018. After this work is complete, we believe we will have identified all material contract types and costs that may be impacted by this amended guidance. The Company is currently planning to adopt the amended guidance using the modified retrospective method as of April 1, 2018. Stock Compensation - In March 2016, the FASB issued Accounting Standards Update 2016-09 “Compensation-Stock Compensation” (Topic 718), which changes the accounting for certain aspects of share-based payments to employees. The new guidance requires excess tax benefits and tax deficiencies to be recorded in the income statement when the awards vest or are settled. Additionally, cash flows related to excess tax benefits will no longer be separately classified as a financing activity and will be included as an operating activity on the consolidated statements of cash flows. The guidance allows for an accounting policy election to account for forfeitures as they occur. The standard is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. We adopted this standard effective April 1, 2017 and it did not have a material impact on our consolidated financial statements. Inventory- In July 2015, the FASB issued Accounting Standards Update 2015-11 “Simplifying the Measurement of Inventory” (Topic 330). Under the new guidance, inventory is measured at the lower of cost and net realizable value, and the new guidance eliminates the use of replacement cost and net realizable value less a normal profit margin as techniques to value inventory. Net realizable value is defined as the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The new guidance will be applied prospectively for annual periods and interim periods within fiscal years beginning after December 15, 2016. We adopted this standard effective April 1, 2017 and it did not have a material impact on our consolidated financial statements. Financial Instruments- In January 2016, the FASB issued Accounting Standards Update 2016-01 “Financial Instruments-Overall” (Subtopic 825-10), which amends the guidance on the classification and measurement of financial instruments. The amendment requires all equity investments to be measured at fair value with changes in the fair value recognized through earnings. The amendment also requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the credit risk when an entity has elected the fair value option. The guidance eliminates the requirement to disclose the methods and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet. The new guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2017. Early adoption is permitted for certain provisions of the accounting standards update. Upon adoption of the standard, an entity will be required to make a cumulative-effect adjustment to retained earnings as of the beginning of such reporting period. We are currently evaluating when to adopt this standard. Upon adoption, we do not anticipate this standard will have a material impact on our consolidated financial statements. Leases - In February 2016, the FASB issued Accounting Standards Update 2016-02 “Leases” (Topic 842), which provides guidance on the recognition, measurement, presentation and disclosure on leases. Under the standard, substantially all leases will be reported on the balance sheet as right-of-use assets and lease liabilities. The new guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2018. Early adoption is permitted. We are currently evaluating the requirements of the standard and have not yet determined its impact on our consolidated financial statements. Financial Instruments- In June 2016, the FASB issued Accounting Standards Update 2016-13 “Financial Instruments-Credit Losses” (Topic 326), which amends the guidance on the impairment of financial instruments. The standard adds an impairment model, referred to as current expected credit loss, which is based on expected losses rather than incurred losses. The standard applies to most debt instruments, trade receivables, lease receivables, reinsurance receivables, financial guarantees and loan commitments. Under the guidance, companies are required to disclose credit quality indicators disaggregated by year of origination for a five-year period. The new guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2019. We do not anticipate this will have a material impact to our consolidated financial statements. Statement of Cash Flows- In August 2016, the FASB issued Accounting Standards Update 2016-15 “Statement of Cash Flows” (Topic 230), which amends Topic 230 of the accounting standards codification (ASC) to add or clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows. The standard addresses eight types of cash flows, some of which we believe could or will impact our financial statements upon adoption, including debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, and proceeds from the settlement of insurance claims. Under the guidance, cash payments for debt prepayment or extinguishment costs must be classified as cash outflows from financing activities. Contingent consideration payments that were not made soon after a business combination must be separated and classified in operating and financing activities. Cash payments up to the amount of the contingent consideration liability recognized as of the acquisition dates, including any measurement-period adjustments, should be classified in financing activities, while any excess cash payments should be classified in operating activities. Cash proceeds from the settlement of insurance claims should be classified on the basis of the nature of the loss. The guidance is effective for fiscal years beginning after December 15, 2017, including interim periods within those years. Early adoption is permitted for all entities. Entities must apply the guidance retrospectively to all periods presented but may be applied prospectively if retrospective application would be impracticable. We do not anticipate this will have a material impact to our consolidated financial statements. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of long-term debt that is not measured at fair value | Information about our investments and long-term debt that is not measured at fair value is as follows: September 30, 2017 March 31, 2017 Carrying Value Fair Value Carrying Value Fair Value Valuation Technique Financial Assets Certificates of deposits with maturities greater than 90 days $ 5,066 $ 5,066 $ 44,786 $ 44,786 Level 2 - Market Approach Financial Liabilities Outstanding principal amount of senior secured credit facility $ 70,875 $ 70,875 $ 81,000 $ 81,000 Level 2 - Market Approach |
Schedule of notional amounts of forward contracts held in foreign currencies | As of September 30, 2017 and March 31, 2017 , the notional amounts of forward contracts were as follows: Notional amount of foreign currency forward contracts by currency September 30, 2017 March 31, 2017 Russian Ruble $ 2,000 $ 250 Euro 500 — South Korean Won 2,000 1,300 Mexican Peso 450 450 Australian Dollar 500 375 Total notional amounts $ 5,450 $ 2,375 |
Schedule of fair value of foreign currency forward contracts | The following table represents the fair value of our foreign currency forward contracts: September 30, 2017 March 31, 2017 Fair Value Fair Value Assets Liabilities Assets Liabilities Foreign currency forward contracts $ — $ 61 $ 62 $ 10 |
Schedule of unrealized gain (loss) in accumulated other comprehensive loss | The following table summarizes the aggregate unrealized loss in accumulated other comprehensive loss, and the losses reclassified into earnings for the three months ended September 30, 2017 and 2016 : Three months ended September 30, 2017 Three Months Ended September 30, 2016 Before Tax Amount Tax Expense (Benefit) Other Comprehensive loss, net Before Tax Amount Tax Expense (Benefit) Other Comprehensive loss, net Unrealized loss at beginning of the period $ (56 ) $ (20 ) $ (36 ) $ (1,470 ) $ (514 ) $ (956 ) Add: gain from change in fair value of cash flow hedge 16 5 11 294 102 192 Less: gain (loss) reclassified into earnings from effective hedge 13 4 9 (142 ) (50 ) (92 ) Less: ineffective portion of hedge transferred into earnings (11 ) (4 ) (7 ) (11 ) (4 ) (7 ) Unrealized loss at end of the period $ (42 ) $ (15 ) $ (27 ) $ (1,023 ) $ (358 ) $ (665 ) Six Months Ended September 30, 2017 Six Months Ended September 30, 2016 Before Tax Amount Tax Expense (Benefit) Other Comprehensive loss, net Before Tax Amount Tax Expense (Benefit) Other Comprehensive loss, net Unrealized loss at beginning of the period $ (53 ) $ (19 ) $ (34 ) $ (1,269 ) $ (444 ) $ (825 ) Add: loss from change in fair value of cash flow hedge (30 ) (11 ) (19 ) (75 ) (27 ) (48 ) Less: loss reclassified into earnings from effective hedge (19 ) (7 ) (12 ) (299 ) (105 ) (194 ) Less: ineffective portion of hedge transferred into earnings (22 ) (8 ) (14 ) (22 ) (8 ) (14 ) Unrealized loss at end of the period $ (42 ) $ (15 ) $ (27 ) $ (1,023 ) $ (358 ) $ (665 ) |
Earnings and Net Income (Loss)
Earnings and Net Income (Loss) per Common Share (Tables) | 6 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of reconciliation of the denominators used to calculate basic EPS and diluted EPS | The reconciliations of the denominators used to calculate basic and diluted net income per common share for the three and six months ended September 30, 2017 and 2016 , respectively, are as follows: Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 Six Months Ended September 30, 2017 Six Months Ended September 30, 2016 Basic net income per common share Net income available to Thermon Group Holdings, Inc. $ 4,778 $ 3,506 $ 5,257 $ 6,032 Weighted-average common shares outstanding 32,408,143 32,278,361 32,412,819 32,255,476 Basic net income per common share $ 0.15 $ 0.11 $ 0.16 $ 0.19 Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 Six Months Ended September 30, 2017 Six Months Ended September 30, 2016 Diluted net income per common share Net income available to Thermon Group Holdings, Inc. $ 4,778 $ 3,506 $ 5,257 $ 6,032 Weighted-average common shares outstanding 32,408,143 32,278,361 32,412,819 32,255,476 Common share equivalents: Stock options 192,179 224,795 197,734 226,396 Restricted and performance stock units 189,199 107,779 106,822 98,416 Weighted average shares outstanding – dilutive (1) 32,789,521 32,610,935 32,717,375 32,580,288 Diluted net income per common share $ 0.15 $ 0.11 $ 0.16 $ 0.19 (1) For the three and six months ended September 30, 2017 , 52,252 and 47,999 equity awards, respectively, were not included in the calculation of diluted net income per common share, as they would have had an anti-dilutive effect. For the three and six months ended September 30, 2016 , 68,736 and 70,799 equity awards, respectively, were not included in the calculation of diluted net income per common share, as they would have had an anti-dilutive effect. |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current | Inventories consisted of the following: September 30, March 31, Raw materials $ 17,580 $ 12,270 Work in process 2,685 1,769 Finished goods 24,797 21,310 45,062 35,349 Valuation reserves (1,572 ) (1,329 ) Inventories, net $ 43,490 $ 34,020 |
Goodwill (Tables)
Goodwill (Tables) | 6 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of carrying amount of goodwill | The carrying amount of goodwill by operating segment as of September 30, 2017 is as follows: United States Canada Europe Asia Total Balance as of March 31, 2017 $ 52,016 $ 43,444 $ 18,437 $ 8,624 $ 122,521 Foreign currency translation impact — 2,851 1,833 — 4,684 Balance as of September 30, 2017 $ 52,016 $ 46,295 $ 20,270 $ 8,624 $ 127,205 |
Schedule of intangible assets | Our total intangible assets consisted of the following: Gross Carrying Amount at September 30, 2017 Accumulated Amortization Net Carrying Amount at September 30, 2017 Gross Carrying Amount at March 31, 2017 Accumulated Amortization Net Carrying Amount at March 31, 2017 Trademarks $ 46,152 $ 657 $ 45,495 $ 44,563 $ 521 $ 44,042 Developed technology 10,159 3,844 6,315 9,796 3,454 6,342 Customer relationships 102,660 72,206 30,454 99,676 64,682 34,994 Certifications 458 — 458 442 — 442 Other 2,639 2,415 224 2,626 2,268 358 Total $ 162,068 $ 79,122 $ 82,946 $ 157,103 $ 70,925 $ 86,178 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 6 Months Ended |
Sep. 30, 2017 | |
Payables and Accruals [Abstract] | |
Schedule of accrued current liabilities | Accrued current liabilities consisted of the following: September 30, March 31, Accrued employee compensation and related expenses $ 7,942 $ 8,364 Customer prepayment 421 168 Warranty reserve 321 300 Professional fees 1,813 1,631 Sales tax payable 1,551 1,573 Other 390 1,106 Total accrued current liabilities $ 12,438 $ 13,142 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 6 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | Long-term debt consisted of the following: September 30, March 31, Variable Rate Term Loan, due April 2019, net of deferred debt issuance costs of $363 and $524 as of September 30, 2017 and March 31, 2017, respectively $ 70,512 $ 80,476 Less current portion (20,250 ) (20,250 ) Total long-term debt $ 50,262 $ 60,226 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Total sales and operating income classified by major geographic area in which the company operates | Total sales to external customers, inter-segment sales, depreciation expense, amortization expense, income from operations, property, plant and equipment, net and total assets for each of our four reportable segments are as follows: Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 Six Months Ended September 30, 2017 Six Months Ended September 30, 2016 Sales to External Customers: United States $ 21,318 $ 29,838 $ 44,869 $ 59,992 Canada 15,437 13,051 27,536 23,160 Europe 17,447 18,554 28,064 32,317 Asia 7,429 7,369 12,898 16,739 $ 61,631 $ 68,812 $ 113,367 $ 132,208 Inter-Segment Sales: United States $ 14,309 $ 13,096 $ 23,891 $ 23,735 Canada 1,895 436 3,359 1,025 Europe 362 405 723 1,006 Asia 174 505 547 633 $ 16,740 $ 14,442 $ 28,520 $ 26,399 Depreciation Expense: United States $ 1,078 $ 890 $ 2,064 $ 1,751 Canada 635 499 1,240 951 Europe 124 73 214 142 Asia 32 37 64 69 $ 1,869 $ 1,499 $ 3,582 $ 2,913 Amortization Expense: United States $ 1,505 $ 1,536 $ 3,010 $ 2,850 Canada 901 890 1,741 1,791 Europe 350 333 679 668 Asia 266 266 532 532 $ 3,022 $ 3,025 $ 5,962 $ 5,841 Income (loss) from operations: United States $ (1,050 ) $ 424 $ (2,097 ) $ 463 Canada 6,549 2,711 9,997 4,444 Europe 2,378 2,913 2,232 4,564 Asia 845 839 1,307 2,883 Unallocated: Stock compensation (947 ) (915 ) (1,732 ) (1,821 ) Public company costs (358 ) (297 ) (732 ) (668 ) $ 7,417 $ 5,675 $ 8,975 $ 9,865 September 30, 2017 March 31, 2017 Property, plant and equipment, net: United States $ 34,938 $ 34,563 Canada 5,796 4,674 Europe 3,572 3,532 Asia 500 497 $ 44,806 $ 43,266 Total Assets: United States $ 178,492 $ 186,300 Canada 152,944 136,688 Europe 85,868 80,589 Asia 50,435 50,503 $ 467,739 $ 454,080 |
Basis of Presentation and Acc27
Basis of Presentation and Accounting Policy Information (Details) | Oct. 03, 2017CADPropertyCAD / $ | Oct. 03, 2017USD ($) | Oct. 03, 2017USD ($)PropertyCAD / $ | Mar. 31, 2017USD ($) |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Increase in income taxes receivable | $ 2,000,000 | |||
Restatement Adjustment | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Decrease in prepaid expense | $ 2,000,000 | |||
Subsequent Event | CCI Thermal Technologies Inc. | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Equity interests acquired | 100.00% | 100.00% | ||
Payments to acquire business | CAD 258,000,000 | $ 206,400,000 | ||
MergerSub | Subsequent Event | CCI Thermal Technologies Inc. | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Aggregate purchase price of real estate | CAD | CAD 31,000,000 | |||
Number of real estate properties | Property | 3 | 3 | ||
Escrow deposit | $ 5,000,000 | |||
Share Repurchase Agreement | MergerSub | Subsequent Event | CCI Thermal Technologies Inc. | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Equity interests acquired | 89.90% | 89.90% | ||
Payments to acquire business | CAD | CAD 204,000,000 | |||
Employee Share Agreements | MergerSub | Subsequent Event | CCI Thermal Technologies Inc. | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Equity interests acquired | 10.10% | 10.10% | ||
Payments to acquire business | CAD | CAD 23,000,000 | |||
Line of Credit | Senior Secured Term Loan B Facility [Member] | Subsequent Event | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Maximum borrowing capacity | $ 250,000,000 | |||
Revolving credit facility | Subsequent Event | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Maximum borrowing capacity | $ 60,000,000 | |||
Non-designated option contract | Subsequent Event | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Notional amount | CAD | CAD 200,000,000 | |||
Weighted average strike price (cad per usd) | CAD / $ | 1.24 | 1.24 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Level 2 - Market Approach - USD ($) $ in Thousands | Sep. 30, 2017 | Mar. 31, 2017 |
Financial Assets | ||
Certificates of deposits with maturities greater than 90 days, Carrying Value | $ 5,066 | $ 44,786 |
Certificates of deposits with maturities greater than 90 days, Fair Value | 5,066 | 44,786 |
Loans Payable | ||
Financial Liabilities, Long-term debt | ||
Long-term debt, Carrying Value | 70,875 | 81,000 |
Long-term debt, Fair Value | $ 70,875 | $ 81,000 |
Fair Value Measurements - Forei
Fair Value Measurements - Foreign Exchange Contracts by Currency (Details) - Foreign Exchange Forward Contracts - USD ($) $ in Thousands | Sep. 30, 2017 | Mar. 31, 2017 |
Derivatives [Line Items] | ||
Notional amount | $ 5,450 | $ 2,375 |
Russian Ruble | ||
Derivatives [Line Items] | ||
Notional amount | 2,000 | 250 |
Euro | ||
Derivatives [Line Items] | ||
Notional amount | 500 | 0 |
South Korean Won | ||
Derivatives [Line Items] | ||
Notional amount | 2,000 | 1,300 |
Mexican Peso | ||
Derivatives [Line Items] | ||
Notional amount | 450 | 450 |
Australian Dollar | ||
Derivatives [Line Items] | ||
Notional amount | $ 500 | $ 375 |
Fair Value Measurements - For30
Fair Value Measurements - Foreign Exchange Contracts (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Mar. 31, 2017 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Maximum term of forward contracts | 30 days | ||||
Net Gain (Loss) on Foreign Currency Derivative Instruments Not Designated as Hedging Instruments | $ (135) | $ (367) | $ 115 | $ 399 | |
Foreign Exchange Forward Contracts | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Foreign exchange contract forwards, assets | 0 | 0 | $ 62 | ||
Foreign exchange contract forwards, liabilities | 61 | 61 | $ 10 | ||
Gain (Loss) on Foreign Currency Derivatives Recorded in Earnings, Net | $ (85) | $ (16) | $ 132 | $ 146 |
Fair Value Measurements - Swap
Fair Value Measurements - Swap (Details) - Interest Rate Swap - USD ($) $ in Thousands | Sep. 30, 2017 | Mar. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash Flow Hedges Derivative Instruments at Fair Value, Net | $ (17) | $ (5) |
Revolving credit facility | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative, fixed interest rate | 3.42% | |
Interest payments, percent hedged | 100.00% |
Fair Value Measurements - Accum
Fair Value Measurements - Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Unrealized Loss in Accumulated Other Comprehensive Loss, before Tax [Roll Forward] | ||||
Unrealized loss at beginning of the period, before tax | $ (56) | $ (1,470) | $ (53) | $ (1,269) |
Add: gain (loss) from change in fair value of cash flow hedge, before tax | 16 | 294 | (30) | (75) |
Less: loss reclassified into earnings from effective hedge, before tax | 13 | (142) | (19) | (299) |
Less: ineffective portion of hedge transferred into earnings, before tax | (11) | (11) | (22) | (22) |
Unrealized loss at end of the period, before tax | (42) | (1,023) | (42) | (1,023) |
Unrealized Loss in Accumulated Other Comprehensive Loss, Tax [Roll Forward] | ||||
Unrealized loss at beginning of the period, tax | (20) | (514) | (19) | (444) |
Add: gain (loss) from change in fair value of cash flow hedge, tax | 5 | 102 | (11) | (27) |
Less: loss reclassified into earnings from effective hedge, tax | 4 | (50) | (7) | (105) |
Less: ineffective portion of hedge transferred into earnings, tax | (4) | (4) | (8) | (8) |
Unrealized loss at end of the period, tax | (15) | (358) | (15) | (358) |
Unrealized Loss In Accumulated Other Comprehensive Loss, Net of Tax [Roll Forward] | ||||
Unrealized net gain (loss), beginning of period | (36) | (956) | (34) | (825) |
Add: gain (loss) from change in fair value of cash flow hedge, net of tax | 11 | 192 | (19) | (48) |
Less: loss reclassified into earnings from effective hedge, net of tax | 9 | (92) | (12) | (194) |
Less: ineffective portion of hedge transferred into earnings, net of tax | (7) | (7) | (14) | (14) |
Unrealized net gain (loss), end of the period | $ (27) | $ (665) | $ (27) | $ (665) |
Earnings and Net Income (Loss33
Earnings and Net Income (Loss) per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Basic net income (loss) per common share | ||||
Net income | $ 4,778 | $ 3,506 | $ 5,257 | $ 6,032 |
Weighted-average common shares outstanding (in shares) | 32,408,143 | 32,278,361 | 32,412,819 | 32,255,476 |
Basic net income (loss) per common share (in dollars per share) | $ 0.15 | $ 0.11 | $ 0.16 | $ 0.19 |
Diluted net income (loss) per common share | ||||
Net income | $ 4,778 | $ 3,506 | $ 5,257 | $ 6,032 |
Weighted-average common shares outstanding (in shares) | 32,408,143 | 32,278,361 | 32,412,819 | 32,255,476 |
Diluted (in shares) | 32,789,521 | 32,610,935 | 32,717,375 | 32,580,288 |
Diluted net income (loss) per common share (in dollars per share) | $ 0.15 | $ 0.11 | $ 0.16 | $ 0.19 |
Equity Option | ||||
Diluted net income (loss) per common share | ||||
Weighted average number of diluted shares outstanding adjustment (in shares) | 192,179 | 224,795 | 197,734 | 226,396 |
Restricted Stock Units | ||||
Diluted net income (loss) per common share | ||||
Weighted average number of diluted shares outstanding adjustment (in shares) | 189,199 | 107,779 | 106,822 | 98,416 |
Stock Compensation Plan | ||||
Diluted net income (loss) per common share | ||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 52,252 | 47,999 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Mar. 31, 2017 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 17,580 | $ 12,270 |
Work in process | 2,685 | 1,769 |
Finished goods | 24,797 | 21,310 |
Inventories, gross | 45,062 | 35,349 |
Valuation reserves | (1,572) | (1,329) |
Inventories, net | $ 43,490 | $ 34,020 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Mar. 31, 2017 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Accumulated Amortization | $ 79,122 | $ 70,925 |
Intangible Assets, Gross (Excluding Goodwill) | 162,068 | 157,103 |
Intangible Assets, Net (Excluding Goodwill) | 82,946 | 86,178 |
Developed Technology Rights | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 10,159 | 9,796 |
Finite-Lived Intangible Assets, Accumulated Amortization | 3,844 | 3,454 |
Finite-Lived Intangible Assets, Net | 6,315 | 6,342 |
Customer Relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 102,660 | 99,676 |
Finite-Lived Intangible Assets, Accumulated Amortization | 72,206 | 64,682 |
Finite-Lived Intangible Assets, Net | 30,454 | 34,994 |
Other Intangible Assets | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 2,639 | 2,626 |
Finite-Lived Intangible Assets, Accumulated Amortization | 2,415 | 2,268 |
Finite-Lived Intangible Assets, Net | 224 | 358 |
Certification Marks | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets (Excluding Goodwill) | $ 458 | $ 442 |
Goodwill (Details)
Goodwill (Details) $ in Thousands | 6 Months Ended |
Sep. 30, 2017USD ($) | |
Goodwill | |
Balance at the beginning of the period | $ 122,521 |
Balance at the end of the period | 127,205 |
Operating Segments | |
Goodwill | |
Balance at the beginning of the period | 122,521 |
Foreign currency translation impact | 4,684 |
Balance at the end of the period | 127,205 |
Operating Segments | United States | |
Goodwill | |
Balance at the beginning of the period | 52,016 |
Foreign currency translation impact | 0 |
Balance at the end of the period | 52,016 |
Operating Segments | Canada | |
Goodwill | |
Balance at the beginning of the period | 43,444 |
Foreign currency translation impact | 2,851 |
Balance at the end of the period | 46,295 |
Operating Segments | Europe | |
Goodwill | |
Balance at the beginning of the period | 18,437 |
Foreign currency translation impact | 1,833 |
Balance at the end of the period | 20,270 |
Operating Segments | Asia | |
Goodwill | |
Balance at the beginning of the period | 8,624 |
Foreign currency translation impact | 0 |
Balance at the end of the period | $ 8,624 |
Goodwill and Other Intangible37
Goodwill and Other Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Mar. 31, 2017 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, accumulated amortization | $ 79,122 | $ 70,925 |
Intangible assets, gross | 162,068 | 157,103 |
Intangible assets, net | 82,946 | 86,178 |
Certifications | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets (excluding goodwill) | 458 | 442 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 46,152 | 44,563 |
Finite-lived intangible assets, accumulated amortization | 657 | 521 |
Finite-lived intangible assets, net carrying amount | 45,495 | 44,042 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 10,159 | 9,796 |
Finite-lived intangible assets, accumulated amortization | 3,844 | 3,454 |
Finite-lived intangible assets, net carrying amount | 6,315 | 6,342 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 102,660 | 99,676 |
Finite-lived intangible assets, accumulated amortization | 72,206 | 64,682 |
Finite-lived intangible assets, net carrying amount | 30,454 | 34,994 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 2,639 | 2,626 |
Finite-lived intangible assets, accumulated amortization | 2,415 | 2,268 |
Finite-lived intangible assets, net carrying amount | $ 224 | $ 358 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Mar. 31, 2017 |
Payables and Accruals [Abstract] | ||
Accrued employee compensation and related expenses | $ 7,942 | $ 8,364 |
Customer prepayment | 421 | 168 |
Warranty reserve | 321 | 300 |
Professional fees | 1,813 | 1,631 |
Sales tax payable | 1,551 | 1,573 |
Other | 390 | 1,106 |
Total accrued current liabilities | $ 12,438 | $ 13,142 |
Short-Term Revolving Lines of C
Short-Term Revolving Lines of Credit (Details) | 3 Months Ended | 6 Months Ended | |||||
Sep. 30, 2017USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2017EUR (€) | Sep. 30, 2017AUD | Sep. 30, 2017USD ($) | Sep. 30, 2017INR (₨) | Mar. 31, 2017USD ($) | |
Netherlands | |||||||
Short-Term Revolving Lines of Credit | |||||||
Outstanding borrowings | $ 0 | $ 0 | |||||
India | |||||||
Short-Term Revolving Lines of Credit | |||||||
Outstanding borrowings | 0 | 0 | |||||
Australia | |||||||
Short-Term Revolving Lines of Credit | |||||||
Outstanding borrowings | 0 | 0 | |||||
Revolving credit facility | |||||||
Short-Term Revolving Lines of Credit | |||||||
Outstanding borrowings | 0 | $ 0 | |||||
Amount outstanding during period | $ 4,000,000 | $ 4,000,000 | |||||
Revolving credit facility | Netherlands | |||||||
Short-Term Revolving Lines of Credit | |||||||
Maximum borrowing capacity | 4,721,000 | ||||||
Revolving credit facility | India | |||||||
Short-Term Revolving Lines of Credit | |||||||
Maximum borrowing capacity | 1,224,000 | ||||||
Revolving credit facility | Australia | |||||||
Short-Term Revolving Lines of Credit | |||||||
Maximum borrowing capacity | $ 180,000 | ||||||
Euro Member Countries, Euro | Revolving credit facility | Netherlands | |||||||
Short-Term Revolving Lines of Credit | |||||||
Maximum borrowing capacity | € | € 4,000,000 | ||||||
India, Rupees | Revolving credit facility | India | |||||||
Short-Term Revolving Lines of Credit | |||||||
Maximum borrowing capacity | ₨ | ₨ 80,000,000 | ||||||
Australian Dollar | Revolving credit facility | Australia | |||||||
Short-Term Revolving Lines of Credit | |||||||
Maximum borrowing capacity | AUD | AUD 230,000 |
Long-Term Debt (Details)
Long-Term Debt (Details) | 6 Months Ended | ||
Sep. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Apr. 30, 2013USD ($) | |
Debt Instrument [Line Items] | |||
Debt issuance costs, net | $ 363,000 | $ 524,000 | |
Less current portion | (20,250,000) | (20,250,000) | |
Long-term debt, noncurrent | $ 50,262,000 | 60,226,000 | |
Maximum leverage ratio | 2.75 | ||
Payments of debt issuance costs | $ 341,000 | ||
Loans Payable | |||
Debt Instrument [Line Items] | |||
Debt issuance costs, net | $ 363,000 | 524,000 | |
Variable Rate Term Loan, due April 2019, net of deferred debt issuance costs of $442 and $524 as of September 30, 2017 and March 31, 2017, respectively | $ 70,512,000 | 80,476,000 | |
Debt Instrument, face amount | 5,905,000 | ||
Debt Instrument, interest rate, stated percentage | 3.50% | ||
Secured Debt | |||
Debt Instrument [Line Items] | |||
Debt Instrument, face amount | 135,000,000 | ||
Revolving credit facility | |||
Debt Instrument [Line Items] | |||
Debt instrument, interest rate, decrease (percentage) | 0.25% | ||
Line of credit facility, decrease in periodic payment (as a percentage) | 0.05% | ||
Annual commitment fee on unutilized commitments (as a percent) | 0.30% | ||
Line of credit facility, commitment fee percentage | 0.125% | ||
Outstanding borrowings | $ 0 | ||
Interest rate at period end (as a percent) | 5.50% | ||
Capacity available under credit facility | $ 56,018,000 | ||
London Interbank Offered Rate (LIBOR) | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.00% | ||
One-Month Canadian Deposit Offered Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.00% | ||
Canadian Deposit Offer Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.10% | ||
Minimum | Base Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.50% | ||
Maximum | Base Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.00% | ||
Through March 31, 2019 | Loans Payable | |||
Debt Instrument [Line Items] | |||
Repayments of Notes Payable | $ 1,688,000 | ||
Due in April 2019 | Loans Payable | |||
Debt Instrument [Line Items] | |||
Repayments of Notes Payable | $ 40,500,000 | ||
Interest Rate Swap | Revolving credit facility | |||
Debt Instrument [Line Items] | |||
Derivative, fixed interest rate | 3.42% | ||
Interest payments, percent hedged | 100.00% | ||
Revolving credit facility | |||
Debt Instrument [Line Items] | |||
Outstanding borrowings | $ 0 | $ 0 | |
Revolving credit facility | Line of Credit | |||
Debt Instrument [Line Items] | |||
Debt Instrument, face amount | $ 60,000,000 |
Related-Party Transactions (Det
Related-Party Transactions (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2017 | Apr. 01, 2015 | |
SUMAC Former Principal | ||
Related Party Transaction [Line Items] | ||
Noncontrolling Interest, ownership by noncontrolling owners (percent) | 25.00% | |
Non-interest Bearing Performance Based Note | ||
Related Party Transaction [Line Items] | ||
Debt Instrument, face amount | $ 5,905,000 | |
Payments to Related Party | SUMAC Former Principal | ||
Related Party Transaction [Line Items] | ||
Related party transaction, amounts of transaction | $ 5,805,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Mar. 31, 2017 |
Commitments and Contingencies Disclosure [Abstract] | ||
Totaled arrangements under letter of credit guarantees and performance bonds securing performance obligations | $ 15,701 | |
Guarantee obligations secured by cash deposits | 1,802 | |
Guarantee obligations represented by a reduction of the available amount of the company's short term and long term revolving lines of credit | 3,982 | |
Cash deposits pledged as collateral on performance bonds and letters of credit | 1,802 | $ 1,450 |
Indian custom bonds outstanding | $ 5,554 |
Stock-Based Compensation Expe43
Stock-Based Compensation Expense (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 49 Months Ended | ||||
Sep. 30, 2017USD ($)shares | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)shares | Sep. 30, 2016USD ($) | Jun. 30, 2014plan | Apr. 08, 2011shares | Jul. 28, 2010shares | |
Stock-Based Compensation Expense | |||||||
Number of stock option award plans | plan | 2 | ||||||
Options outstanding (in shares) | 408,527 | 408,527 | |||||
Stock compensation expense | $ | $ 947 | $ 915 | $ 1,732 | $ 1,821 | |||
Restricted Stock and Stock Option Plan | |||||||
Stock-Based Compensation Expense | |||||||
Maximum number of shares of the company's common stock that may be awarded | 2,767,171 | ||||||
2011 Long-term Incentive Plan | |||||||
Stock-Based Compensation Expense | |||||||
Maximum number of shares of the company's common stock that may be awarded | 2,893,341 | ||||||
Restricted Stock Units | |||||||
Stock-Based Compensation Expense | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 104,962 | ||||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ | $ 1,950 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Requisite Service Period | 3 years | ||||||
Common Stock | |||||||
Stock-Based Compensation Expense | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 5,404 | 10,052 | |||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ | $ 105 | $ 201 | |||||
Share-based compensation arrangement by share-based payment award, fair value of shares authorized amount | $ | $ 420 | $ 420 | |||||
Performance Shares | |||||||
Stock-Based Compensation Expense | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 15,438 | ||||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ | $ 340 | ||||||
Minimum | |||||||
Stock-Based Compensation Expense | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Possible Number of Performance Shares to be Granted | 0 | ||||||
Maximum | |||||||
Stock-Based Compensation Expense | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Possible Number of Performance Shares to be Granted | 30,876 | ||||||
Management | Performance Shares | |||||||
Stock-Based Compensation Expense | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 58,246 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Fair Value | $ | $ 1,080 | ||||||
Management | Minimum | |||||||
Stock-Based Compensation Expense | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Possible Number of Performance Shares to be Granted | 0 | ||||||
Management | Maximum | |||||||
Stock-Based Compensation Expense | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Possible Number of Performance Shares to be Granted | 116,492 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense | $ 1,688 | $ 808 | $ 1,915 | $ 1,823 |
Pre-tax income (loss) | 6,766 | $ 4,482 | $ 7,707 | $ 8,141 |
Annual effective tax rate | 24.80% | 22.40% | ||
Long-term liability for uncertain tax positions | $ 543 | $ 543 | ||
Interest and penalties accrued as income tax expense | $ 10 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)segmentGeographic_Region | Sep. 30, 2016USD ($) | Mar. 31, 2017USD ($) | |
Sales by geographic area: | |||||
Number of Reportable Segments | segment | 4 | ||||
Number of Operating Segments | Geographic_Region | 4 | ||||
Revenues | $ 61,631 | $ 68,812 | $ 113,367 | $ 132,208 | |
Depreciation | 1,869 | 1,499 | 3,582 | 2,913 | |
Amortization of intangible assets | 3,022 | 3,025 | 5,962 | 5,841 | |
Operating income | |||||
Operating income (loss) | 7,417 | 5,675 | 8,975 | 9,865 | |
Stock compensation expense | 947 | 915 | 1,732 | 1,821 | |
Property, plant and equipment, net | 44,806 | 44,806 | $ 43,266 | ||
Assets | 467,739 | 467,739 | 454,080 | ||
Operating Segments | |||||
Sales by geographic area: | |||||
Revenues | 61,631 | 68,812 | 113,367 | 132,208 | |
Intersegment Eliminations | |||||
Sales by geographic area: | |||||
Revenues | 16,740 | 14,442 | 28,520 | 26,399 | |
Segment Reconciling Items | |||||
Operating income | |||||
Stock compensation expense | (947) | (915) | (1,732) | (1,821) | |
Public company costs | (358) | (297) | (732) | (668) | |
United States | |||||
Sales by geographic area: | |||||
Depreciation | 1,078 | 890 | 2,064 | 1,751 | |
Amortization of intangible assets | 1,505 | 1,536 | 3,010 | 2,850 | |
Operating income | |||||
Operating income (loss) | (1,050) | 424 | (2,097) | 463 | |
Property, plant and equipment, net | 34,938 | 34,938 | 34,563 | ||
Assets | 178,492 | 178,492 | 186,300 | ||
United States | Operating Segments | |||||
Sales by geographic area: | |||||
Revenues | 21,318 | 29,838 | 44,869 | 59,992 | |
United States | Intersegment Eliminations | |||||
Sales by geographic area: | |||||
Revenues | 14,309 | 13,096 | 23,891 | 23,735 | |
Canada | |||||
Sales by geographic area: | |||||
Depreciation | 635 | 499 | 1,240 | 951 | |
Amortization of intangible assets | 901 | 890 | 1,741 | 1,791 | |
Operating income | |||||
Operating income (loss) | 6,549 | 2,711 | 9,997 | 4,444 | |
Property, plant and equipment, net | 5,796 | 5,796 | 4,674 | ||
Assets | 152,944 | 152,944 | 136,688 | ||
Canada | Operating Segments | |||||
Sales by geographic area: | |||||
Revenues | 15,437 | 13,051 | 27,536 | 23,160 | |
Canada | Intersegment Eliminations | |||||
Sales by geographic area: | |||||
Revenues | 1,895 | 436 | 3,359 | 1,025 | |
Europe | |||||
Sales by geographic area: | |||||
Depreciation | 124 | 73 | 214 | 142 | |
Amortization of intangible assets | 350 | 333 | 679 | 668 | |
Operating income | |||||
Operating income (loss) | 2,378 | 2,913 | 2,232 | 4,564 | |
Property, plant and equipment, net | 3,572 | 3,572 | 3,532 | ||
Assets | 85,868 | 85,868 | 80,589 | ||
Europe | Operating Segments | |||||
Sales by geographic area: | |||||
Revenues | 17,447 | 18,554 | 28,064 | 32,317 | |
Europe | Intersegment Eliminations | |||||
Sales by geographic area: | |||||
Revenues | 362 | 405 | 723 | 1,006 | |
Asia | |||||
Sales by geographic area: | |||||
Depreciation | 32 | 37 | 64 | 69 | |
Amortization of intangible assets | 266 | 266 | 532 | 532 | |
Operating income | |||||
Operating income (loss) | 845 | 839 | 1,307 | 2,883 | |
Property, plant and equipment, net | 500 | 500 | 497 | ||
Assets | 50,435 | 50,435 | $ 50,503 | ||
Asia | Operating Segments | |||||
Sales by geographic area: | |||||
Revenues | 7,429 | 7,369 | 12,898 | 16,739 | |
Asia | Intersegment Eliminations | |||||
Sales by geographic area: | |||||
Revenues | $ 174 | $ 505 | $ 547 | $ 633 | |
Sumac Fabrication Company Limited | |||||
Sales by geographic area: | |||||
Expected sales and operating income as a percentage of total sales and operating income, less than | 10.00% | 10.00% |