Cover Page
Cover Page - shares | 3 Months Ended | |
Jun. 30, 2022 | Aug. 03, 2022 | |
Cover [Abstract] | ||
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-35159 | |
Entity Registrant Name | THERMON GROUP HOLDINGS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 27-2228185 | |
Entity Address, Address Line One | 7171 Southwest Parkway | |
Entity Address, Address Line Two | Building 300 | |
Entity Address, Address Line Three | Suite 200 | |
Entity Address, City or Town | Austin | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 78735 | |
City Area Code | 512 | |
Local Phone Number | 690-0600 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 33,474,754 | |
Entity Central Index Key | 0001489096 | |
Current Fiscal Year End Date | --03-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Trading Symbol | THR | |
Security Exchange Name | NYSE |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2022 | Mar. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 40,035 | $ 41,445 |
Accounts receivable, net of allowances of $2,242 and $2,177 as of June 30, 2022 and March 31, 2022, respectively | 94,278 | 95,305 |
Inventories, net | 86,226 | 71,650 |
Contract assets | 12,668 | 19,626 |
Prepaid expenses and other current assets | 12,394 | 11,786 |
Income tax receivable | 1,967 | 4,626 |
Total current assets | 247,568 | 244,438 |
Property, plant and equipment, net | 64,579 | 66,039 |
Goodwill | 226,495 | 212,754 |
Intangible assets, net | 103,466 | 94,908 |
Operating lease right-of-use assets | 10,897 | 10,534 |
Deferred income taxes | 1,187 | 1,211 |
Other long-term assets | 7,739 | 6,785 |
Total assets | 661,931 | 636,669 |
Current liabilities: | ||
Accounts payable | 38,071 | 33,567 |
Accrued liabilities | 21,268 | 26,971 |
Current portion of long term debt | 8,695 | 7,929 |
Borrowings under revolving credit facility | 29,000 | 0 |
Contract liabilities | 10,865 | 8,010 |
Lease liabilities | 3,664 | 3,624 |
Income taxes payable | 1,120 | 897 |
Total current liabilities | 112,683 | 80,998 |
Long-term debt, net | 112,554 | 120,431 |
Deferred income taxes | 16,787 | 17,943 |
Non-current lease liabilities | 9,833 | 9,659 |
Other noncurrent liabilities | 8,822 | 8,434 |
Total liabilities | 260,679 | 237,465 |
Commitments and contingencies (Note 10) | ||
Equity | ||
Common stock: $0.001 par value; 150,000,000 authorized; 33,468,134 and 33,364,722 shares issued and outstanding at June 30, 2022 and March 31, 2022, respectively | 33 | 33 |
Preferred stock: $0.001 par value; 10,000,000 authorized; no shares issued and outstanding | 0 | 0 |
Additional paid in capital | 235,190 | 234,549 |
Accumulated other comprehensive loss | (44,056) | (38,906) |
Retained earnings | 210,085 | 203,528 |
Total equity | 401,252 | 399,204 |
Total liabilities and equity | $ 661,931 | $ 636,669 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2022 | Mar. 31, 2022 |
Depreciation and amortization | $ 66,159 | $ 63,954 |
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 | 33,468,134 | 33,364,722 |
Common stock, shares outstanding | 33,468,134 | 33,364,722 |
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 |
Thermon Holding Corp. | ||
Accounts receivable, allowance for doubtful accounts (in dollars) | $ 2,242 | $ 2,177 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Income Statement [Abstract] | ||
Sales | $ 95,442 | $ 71,155 |
Cost of sales | 58,217 | 44,617 |
Gross profit | 37,225 | 26,538 |
Operating expenses: | ||
Selling, general and administrative expenses | 24,403 | 21,401 |
Deferred compensation plan expense/(income) | (660) | 332 |
Amortization of intangible assets | 2,268 | 2,236 |
Restructuring and other charges/(income) | 0 | (414) |
Income/(loss) from operations | 11,214 | 2,983 |
Other income/(expenses): | ||
Interest expense, net | (835) | (2,165) |
Other income/(expense) | (916) | 66 |
Income/(loss) before provision for income taxes | 9,463 | 884 |
Income tax expense/(benefit) | 2,907 | 1,224 |
Net income/(loss) | 6,556 | (340) |
Net income/(loss) | 6,556 | (340) |
Comprehensive income/(loss): | ||
Net income/(loss) | 6,556 | (340) |
Foreign currency translation adjustment | (5,152) | 4,302 |
Other miscellaneous income/(loss) | 2 | (64) |
Comprehensive income/(loss) | $ 1,406 | $ 3,898 |
Net income/(loss) per common share: | ||
Basic (in dollars per share) | $ 0.20 | $ (0.01) |
Diluted (in dollars per share) | $ 0.20 | $ (0.01) |
Weighted-average shares used in computing net income/(loss) per common share: | ||
Basic (in shares) | 33,399,868 | 33,259,804 |
Diluted (in shares) | 33,567,284 | 33,259,804 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Retained Earnings/ (Loss) | Accumulated Other Comprehensive Income/(Loss) | Employees Common Stock | Executive Officer Common Stock | Director Common Stock |
Beginning balance (in shares) at Mar. 31, 2021 | 33,225,808 | |||||||
Beginning balance at Mar. 31, 2021 | $ 378,872 | $ 33 | $ 231,322 | $ 183,436 | $ (35,919) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common stock in exercise of stock options (in shares) | 8,100 | |||||||
Issuance of common stock in exercise of stock options | 97 | $ 0 | 97 | |||||
Issuance of common stock (in shares) | 23,858 | 42,326 | 7,368 | |||||
Stock compensation expense | 1,178 | 1,178 | ||||||
Repurchase of employee stock units on vesting | (548) | (548) | ||||||
Net income/(loss) | (340) | (340) | ||||||
Foreign currency translation adjustment | 4,302 | 4,302 | ||||||
Other | (64) | (64) | ||||||
Ending balance (in shares) at Jun. 30, 2021 | 33,307,460 | |||||||
Ending balance at Jun. 30, 2021 | $ 383,497 | $ 33 | 232,049 | 183,096 | (31,681) | |||
Beginning balance (in shares) at Mar. 31, 2022 | 33,364,722 | 33,364,722 | ||||||
Beginning balance at Mar. 31, 2022 | $ 399,204 | $ 33 | 234,549 | 203,528 | (38,906) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common stock (in shares) | 30,352 | 64,294 | 8,766 | |||||
Stock compensation expense | 1,193 | 1,193 | ||||||
Repurchase of employee stock units on vesting | (552) | (552) | ||||||
Net income/(loss) | 6,556 | 6,556 | ||||||
Foreign currency translation adjustment | (5,152) | 0 | (5,152) | |||||
Other | $ 3 | 1 | 2 | |||||
Ending balance (in shares) at Jun. 30, 2022 | 33,468,134 | 33,468,134 | ||||||
Ending balance at Jun. 30, 2022 | $ 401,252 | $ 33 | $ 235,190 | $ 210,085 | $ (44,056) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Operating activities | ||
Net income/(loss) | $ 6,556 | $ (340) |
Adjustments to reconcile net income/(loss) to net cash provided by/(used in) operating activities: | ||
Depreciation and amortization | 4,895 | 5,291 |
Amortization of deferred debt issuance costs | 77 | 223 |
Stock compensation expense | 1,193 | 1,178 |
Deferred income taxes | (682) | 491 |
Reserve for uncertain tax positions, net | 19 | 19 |
(Gain)/Loss on long-term cross currency swap | 0 | 61 |
Remeasurement (gain)/loss on intercompany balances | (414) | (1,493) |
Loss on sale of business, net of cash surrendered | 0 | 311 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 1,323 | 1,209 |
Inventories | (9,830) | 39 |
Contract assets | 8,829 | (3,456) |
Other current and non-current assets | (531) | (691) |
Accounts payable | 3,485 | 2,501 |
Accrued liabilities and non-current liabilities | (5,977) | (1,628) |
Income taxes payable and receivable | 2,917 | (1,238) |
Net cash provided by/(used in) operating activities | 11,860 | 2,477 |
Investing activities | ||
Purchases of property, plant and equipment | (1,617) | (873) |
Sale of rental equipment | 63 | 21 |
Cash paid for acquisitions, net of cash acquired | (35,339) | 0 |
Net cash provided by/(used in) in investing activities | (36,893) | (852) |
Financing activities | ||
Proceeds from revolving credit facility | 32,000 | 7,959 |
Payments on long-term debt and revolving credit facility | (8,654) | (8,759) |
Proceeds from exercise of stock options | 0 | 97 |
Repurchase of employee stock units on vesting | (552) | (548) |
Payments on finance leases | (31) | (40) |
Net cash provided by/(used in) financing activities | 22,763 | (1,291) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 1,031 | 604 |
Change in cash, cash equivalents and restricted cash | (1,239) | 938 |
Cash, cash equivalents and restricted cash at beginning of period | 43,931 | 42,450 |
Cash, cash equivalents and restricted cash at end of period | $ 42,692 | $ 43,388 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Thermon Group Holdings, Inc. and its direct and indirect subsidiaries are referred to collectively as “we,” “our,” or the “Company” herein. We are one of the largest providers of highly engineered industrial process heating solutions for process industries. We offer a full suite of products (heating units, heating cables, temporary power solutions, tubing bundles, industrial heating blankets and chillers), services (engineering, installation and maintenance services) and software (design optimization and wireless and network control systems) required to deliver comprehensive solutions to some of the world's largest and most complex projects. Our condensed consolidated financial statements are prepared in conformity with generally accepted accounting principles in the United States ("GAAP") and the requirements of the United States Securities and Exchange Commission ("SEC") for interim financial information. Accordingly, the accompanying condensed consolidated financial statements do not include all disclosures required for full annual financial statements and should be read in conjunction with our audited consolidated financial statements and notes thereto for the fiscal year ended March 31, 2022 ("fiscal 2022"). In our opinion, the accompanying condensed consolidated financial statements reflect all adjustments considered necessary to present fairly our financial position at June 30, 2022 and March 31, 2022, and the results of our operations for the three months ended June 30, 2022 and 2021. Certain prior year amounts have been reclassified to conform with the current year's presentation. Impact of the COVID-19 Pandemic and General Economic Environment The COVID-19 pandemic and the measures being taken to address and limit the spread of the virus have adversely affected the economies and financial markets of many countries, resulting in an economic downturn that negatively impacted, and may continue to negatively impact, global demand for our products and services. We are still experiencing effects of lockdowns in Asia and Australia, which are impacting our results in our Asia-Pacific ("APAC") segment. The effect of loosening pandemic restrictions outside of APAC, along with pent-up demand from periods of stagnant lockdown and uncertainty have combined to strengthen customer demand from most regions we serve, especially in North America. During periods of the pandemic we have experienced, and may experience in the future, a decline in the demand of our products and services or disruptions in raw materials or labor required for manufacturing that has in the past, and may in the future, materially and negatively impact our business, financial condition, results of operation and overall financial performance. We have experienced increased costs across our global supply chain as we focus on meeting growing demand from our customers. In certain circumstances, we have had issues with a lack of availability of certain raw materials as well as increases in costs of our raw materials due to: use of alternate suppliers, higher freight costs, increased lead times, and expedited shipping. We continue to monitor the pandemic restrictions and other effects the pandemic may have on our business. On April 11, 2020, the Canadian government officially enacted the Canadian Emergency Wage Subsidy (the “CEWS”) for the purposes of assisting employers in financial hardship due to the COVID-19 pandemic and of reducing potential layoffs of employees. We recorded no transactions related to CEWS for the three months ended June 30, 2022. We recorded $701 to "Cost of sales" in our condensed consolidated statement of operations for the three months ended June 30, 2021. We recorded $314 to "Selling, general and administrative expenses" in our condensed consolidated statement of operations for the three months ended June 30, 2021. Additionally, we capitalized $0 and $2 in "Inventories, net" at June 30, 2022 and March 31, 2022, respectively. We anticipate no benefit from the CEWS program in the fiscal year ending March 31, 2023 ("fiscal 2023") as the program ended in October 2021. Use of Estimates Generally accepted accounting principles 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 management has based their assumptions and estimates on the facts and circumstances existing at June 30, 2022, 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 months ended June 30, 2022 are not necessarily indicative of the results that may be achieved for fiscal 2023. Restricted Cash and Cash Equivalents The Company maintains restricted cash related to certain letter of credit guarantees and performance bonds securing performance obligations. The following table provides a reconciliation of cash, cash equivalents, and restricted cash included in prepaid expenses and other current assets and restricted cash included in other long-term assets reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the statements of cash flows. June 30, 2022 March 31, 2022 Cash and cash equivalents $ 40,035 $ 41,445 Restricted cash included in prepaid expenses and other current assets 2,657 2,486 Total cash, cash equivalents, and restricted cash shown in the statements of cash flows $ 42,692 $ 43,931 Amounts shown in restricted cash included in prepaid expenses and other current assets and other long-term assets represent those required to be set aside by a contractual agreement, which contain cash deposits pledged as collateral on performance bonds and letters of credit. Amounts shown in restricted cash in other long-term assets represent such agreements that require a commitment term longer than one year. Recent Accounting Pronouncements Business Combinations - In October 2021, the FASB issued Accounting Standards Update, ("ASU") 2021-08 - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers |
Acquisition
Acquisition | 3 Months Ended |
Jun. 30, 2022 | |
Business Combinations [Abstract] | |
Acquisition | Acquisition Powerblanket On May 31, 2022 (the "Acquisition Date"), Thermon Holding Corp., as buyer, acquired 100% of the issued and outstanding equity interests of Powerblanket (“Powerblanket”) from Glacier Capital LLC, as seller (the "Acquisition"). Powerblanket is a leading North American supplier of heated blankets built upon patented heat spreading technology and portable industrial chillers. The Acquisition increases our exposure to growing industrial and commercial end-markets through its freeze protection, temperature control and flow assurance solutions. We have integrated Powerblanket into our United States and Latin America ("US- LAM") reportable segment. From the period May 31, 2022 to June 30, 2022, Powerblanket contributed $964 in Sales and $(268) in Net income/(loss) to our consolidated operating results. The initial purchase price for the Acquisition was $35.0 million, subject to an adjustment for net working capital acquired at closing. Subsequent to the Acquisition Date, and commensurate with the purchase agreement, we increased the purchase price by $0.3 million for net working capital acquired. The net working capital will be finalized with the seller within 120 days of the Acquisition Date. As such, the purchase price is subject to change. We financed the acquisition through the use of our revolving credit facility as well as cash on hand. Powerblanket's revenue structure does not result in material contract assets or liabilities. Acquisition Costs In accordance with GAAP, costs incurred to complete the Acquisition are expensed as incurred. Total acquisition costs, which represent transaction costs, legal fees, and third-party professional fees were $403, of which $251 were incurred in the three months ended June 30, 2022. Acquisition costs are reflected in "Selling, general and administrative expenses," in our condensed consolidated statement of operations and comprehensive income/(loss). Purchase Price Allocation We have accounted for the Acquisition according to the business combinations guidance found in ASC 805 - Business Combinations, henceforth referred to as acquisition accounting. Acquisition accounting requires, among other things, that assets acquired and liabilities assumed be recognized at their fair values as of the Acquisition date. We used primarily Level 2 inputs to allocate the purchase price to the major categories of assets and liabilities shown below, with the exception of the contract-based intangible asset, which was valued using Level 3 inputs. The carrying values of inventories, property, plant and equipment as well as leased assets approximated their respective fair values. During the measurement period, if new information is obtained about facts and circumstances that existed as of the Acquisition Date that, if known, would have resulted in revised estimated values of those assets or liabilities as of that date, we will revise the preliminary purchase price allocation. The effect of measurement period adjustments to the estimated fair values will be reflected as if the adjustments had been completed on the Acquisition Date. The impact of all changes that do not qualify as measurement period adjustments will be included in current period earnings. Purchase Price Allocation Amortization Period (years) Fair Value Accounts receivable $ 1,267 Inventories 3,545 Property, plant and equipment 391 Other current assets 290 Other long-term assets 954 Intangibles: Customer relationships 9.8 3,301 Trademarks 9.8 3,397 Contract-based 5.0 1,280 Developed technology 15.8 5,189 Goodwill 18,585 Total fair value of assets acquired $ 38,199 Accounts payable (1,022) Accrued liabilities (637) Other liabilities (1,201) Total fair value of liabilities acquired $ (2,860) Purchase Price $ 35,339 Unaudited Pro Forma Financial Information The following unaudited pro forma results of operations assume that the Acquisition occurred at the beginning of the periods presented. These unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations would have been if the Acquisition had occurred at the beginning of the periods presented, nor are they indicative of future results of operations. The pro forma results presented below are adjusted for the removal of acquisition and other related costs of $286 for the three months ended June 30, 2022. Three Months Ended June 30, 2022 Three Months Ended June, 30, 2021 Sales $ 97,324 $ 73,635 Net Income/(loss) 6,162 (295) |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Jun. 30, 2022 | |
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 use 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 and cash equivalents, 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 June 30, 2022 and March 31, 2022, no assets or liabilities were valued using Level 3 criteria. Information about our long-term debt that is not measured at fair value is as follows: June 30, 2022 March 31, 2022 Carrying Fair Value Carrying Fair Value Valuation Technique Financial Assets Deferred compensation plan assets $ 5,799 $ 5,799 $ 5,391 $ 5,391 Level 1 - Active Markets Foreign currency contract forwards assets 9 9 105 105 Level 2 - Market Approach Financial Liabilities Outstanding borrowings from revolving line of credit $ 29,000 $ 29,000 $ — $ — Level 1 - Active Markets Outstanding principal amount of senior secured credit facility 121,837 121,228 129,000 128,355 Level 2 - Market Approach Deferred compensation plan liabilities 5,222 5,222 4,837 4,837 Level 1 - Active Markets Foreign currency contract forwards liabilities 55 55 — — Level 2 - Market Approach At June 30, 2022 and March 31, 2022, the fair value of our long-term debt is based on market quotes available for issuance of debt with similar terms. 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. Additionally, we acquired certain assets and liabilities as disclosed in Note 2, "Acquisition" at fair value according to purchase price accounting Deferred Compensation Plan The Company provides a non-qualified deferred compensation plan for certain highly compensated employees where payroll contributions are made by the employees on a pre-tax basis. Included in “Other long-term assets” in the condensed consolidated balance sheets at June 30, 2022 and March 31, 2022 were $5,799 and $5,391, respectively, of deferred compensation plan assets held by the Company. Deferred compensation plan assets (mutual funds) are measured at fair value on a recurring basis based on quoted market prices in active markets (Level 1). The Company has a corresponding liability to participants of $5,222 and $4,837 included in “Other long-term liabilities” in the condensed consolidated balance sheets at June 30, 2022 and March 31, 2022, respectively. Deferred compensation plan expense/(income) is included as such in the condensed consolidated statement of operations, and therefore is excluded from "Selling, general and administrative expenses." Deferred compensation plan expense/(income) was $(660) and $332 for the three months ended June 30, 2022 and 2021, respectively. Expenses and income from our deferred compensation plan were offset by unrealized gains and losses for the deferred compensation plan included in "Other income and expense" on our condensed consolidated statements of operations and comprehensive income/(loss). Our unrealized losses and (gains) on investments were $637 and $(326), respectively, for the three months ended June 30, 2022 and 2021, respectively. Trade Related Foreign Currency Forward Contracts We transact business in various foreign currencies and have established a program that primarily utilizes foreign currency forward contracts to address 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 "Other income and expense" on our condensed consolidated statements of operations and comprehensive income/(loss). 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). Fair value amounts for such forward contracts on our condensed consolidated balance sheets are either classified as accounts receivable, net or accrued liabilities depending on whether the forward contract is in a gain (accounts receivable, net) or loss (accrued liabilities) position. 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 June 30, 2022 and March 31, 2022, the notional amounts of forward contracts were as follows: Notional amount of foreign currency forward contracts by currency June 30, 2022 March 31, 2022 Canadian Dollar $ 900 $ 4,000 South Korean Won 2,500 2,250 Mexican Peso 1,000 — Australian Dollar 400 1,000 Chinese Renminbi 500 — Total notional amounts $ 5,300 $ 7,250 Foreign currency gains or losses related to our forward contracts in the accompanying condensed consolidated statements of operations and comprehensive income/(loss) were losses of $(296) and of $(294) in the three months ended June 30, 2022 and 2021, respectively . 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 June 30, 2022 and 2021, our net foreign currency transactions resulted in losses of $(359) and $(284), respectively. |
Restructuring and other charges
Restructuring and other charges (income) | 3 Months Ended |
Jun. 30, 2022 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and other charges (income) | Restructuring and Other Charges/(Income) Fiscal 2023 charges/(income) No activity was recorded for the three months ended June 30, 2022. Fiscal 2022 charges/(income) We recorded $(103) for severance-related activity in our Canadian segment, which was recorded to "Restructuring and other charges/(income)" in our condensed consolidated statements of operations and comprehensive income/(loss). Additionally, we recorded $(311) in cash receipts related to receivables existing prior to the sale of our South Africa business, which was completed in fiscal 2021. Restructuring and other charges/(income) by reportable segment were as follows: Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 United States and Latin America $ — $ (46) Canada — (186) Europe, Middle East and Africa — (182) Asia-Pacific — — $ — $ (414) |
Net Income_(Loss) per Common Sh
Net Income/(Loss) per Common Share | 3 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Net Income/(Loss) per Common Share | Net Income/(Loss) per Common Share Basic net income/(loss) per common share is computed by dividing net income/(loss) by the weighted average number of common shares outstanding during each period. Diluted net income/(loss) per common share is computed by dividing net income/(loss) 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 assume that the associated performance targets will be met at the target level of performance for purposes of calculating diluted net income/(loss) per common share until such time that it is probable that the performance target will not be met. The reconciliations of the denominators used to calculate basic and diluted net income/(loss) per common share for the three months ended June 30, 2022 and 2021, respectively, are as follows: Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Basic net income/(loss) per common share Net income/(loss) $ 6,556 $ (340) Weighted-average common shares outstanding 33,399,868 33,259,804 Basic net income/(loss) per common share $ 0.20 $ (0.01) Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Diluted net income/(loss) per common share Net income/(loss) $ 6,556 $ (340) Weighted-average common shares outstanding 33,399,868 33,259,804 Common share equivalents: Stock options — — Restricted and performance stock units 167,416 — Weighted average shares outstanding – dilutive (1) 33,567,284 33,259,804 Diluted net income/(loss) per common share (2) $ 0.20 $ (0.01) (1) For the three months ended June 30, 2022 and 2021, 179,882 and 65,854 equity awards, respectively, were not included in the calculation of diluted net income/(loss) per common share, as they would have had an anti-dilutive effect. (2) As the Company incurred a net loss for the three months ended June 30, 2021, there was no dilutive effect on net loss per common share as common share equivalents are antidilutive. Therefore, both basic and diluted net loss per common share were $(0.01) for the three months ended June 30, 2021. |
Inventories
Inventories | 3 Months Ended |
Jun. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following: June 30, 2022 March 31, 2022 Raw materials $ 49,422 $ 41,389 Work in process 5,296 6,294 Finished goods 33,880 25,802 88,598 73,485 Valuation reserves (2,372) (1,835) Inventories, net $ 86,226 $ 71,650 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The carrying amount of goodwill by operating segment as of June 30, 2022 is as follows: United States and Latin America Canada Europe, Middle East and Africa Asia-Pacific Total Balance as of March 31, 2022 $ 62,725 $ 122,318 $ 19,087 $ 8,624 $ 212,754 Goodwill acquired (1) 18,585 — — — 18,585 Foreign currency translation impact — (3,702) (1,142) — (4,844) Balance as of June 30, 2022 $ 81,310 $ 118,616 $ 17,945 $ 8,624 $ 226,495 (1) - Refer to Note 2, "Acquisition" for more information on the goodwill acquired through our recent acquisition. 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, which is 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 the fourth quarter of fiscal 2022, we identified the disruptions to our business from the ongoing Russo-Ukrainian war as an indicator of potential impairments in our EMEA reporting unit. We performed our annual goodwill, intangible and tangible impairment assessments including our indefinite life trademarks. Based on the goodwill impairment assessment, there was no impairment of goodwill, intangible or tangible assets or our indefinite life trademarks as of the respective reporting periods. If overall economic conditions, our key end markets, or factors specific to the Company deteriorate significantly, it could negatively impact the Company's future impairment tests. We will continue to monitor our reporting units' goodwill and asset valuations and test for potential impairments. Separately, we added $18,585 of goodwill as part of our recent acquisition, which is discussed further in Note 2, "Acquisition." The newly-acquired goodwill is allocated to our US-LAM segment. We believe the goodwill acquired represents synergies from combining operations in addition to the already identifiable assets. We anticipate being able to deduct goodwill for tax purposes. No triggering events were identified during the three-month period ended June 30, 2022 which would indicate that the fair value of any of our reporting units was less than its carrying amount. Our total intangible assets consisted of the following: Gross Carrying Amount at June 30, 2022 Accumulated Amortization Net Carrying Amount at June 30, 2022 Gross Carrying Amount at March 31, 2022 Accumulated Amortization Net Carrying Amount at March 31, 2022 Products $ 64,651 $ (30,170) $ 34,481 $ 66,669 $ (29,445) $ 37,224 Trademarks 47,736 (1,601) 46,135 45,222 (1,517) 43,705 Developed technology 14,933 (5,960) 8,973 9,946 (5,933) 4,013 Customer relationships 114,753 (102,571) 12,182 113,413 (103,900) 9,513 Certifications 444 — 444 453 — 453 Contract-based 1,280 (29) 1,251 — — — Total $ 243,797 $ (140,331) $ 103,466 $ 235,703 $ (140,795) $ 94,908 |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued Liabilities Accrued current liabilities consisted of the following: June 30, 2022 March 31, 2022 Accrued employee compensation and related expenses $ 11,901 $ 16,235 Accrued interest 304 277 Customer prepayments 71 405 Warranty reserves 780 557 Professional fees 2,563 2,540 Sales taxes payable 2,440 2,758 Other (1) 3,209 4,199 Total accrued current liabilities $ 21,268 $ 26,971 (1) - Included in Other are accrued warranty-related costs of $1,746 and $2,523, respectively, associated with the operational execution of a US-LAM project that was completed previously. |
Debt
Debt | 3 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Debt Long-term debt consisted of the following: June 30, 2022 March 31, 2022 Variable Rate Term Loan A due September 2026 net of deferred debt issuance costs of $588 and $640 as of June 30, 2022 and March 31, 2022, respectively $ 121,249 $ 128,360 Less current portion (8,695) (7,929) Total long-term debt $ 112,554 $ 120,431 Senior Secured Credit Facilities On September 29, 2021, Thermon Group Holdings, Inc., as a credit party and a guarantor, Thermon Holding Corp. (“THC” or the “U.S. Borrower”) and Thermon Canada Inc. (the “Canadian Borrower” and together with THC, the “Borrowers”), as borrowers, entered into an Amended and Restated Credit Agreement (the “Credit Agreement”) with several banks and other financial institutions or entities from time to time (the “Lenders”) and JPMorgan Chase Bank, N.A., as Administrative Agent (the “Agent”), which was further amended on November 19, 2021. The Credit Agreement is an amendment and restatement of that certain Credit Agreement dated October 30, 2017 by and among Borrowers, the lenders party thereto and JPMorgan Chase Bank, N.A. as administrative agent (the “Prior Credit Agreement”), and provides for the following credit facilities described below (collectively, the “Facilities”). • Revolving Credit Facility: A USD $100,000 five • U.S. Term Loan Facility: A USD $80,000 five • Canadian Term Loan Facility: A CAD $76,182 five Proceeds of the Facilities were used at closing to repay and refinance the Borrowers’ existing indebtedness under the Prior Credit Agreement and pay all interest, fees and expenses related thereto, and thereafter are expected to be used for working capital and general corporate purposes. The Credit Agreement allows for incremental term loans and incremental revolving commitments in an amount not to exceed USD $100,000. Maturity and Repayment Each of the Facilities terminates on September 29, 2026. Commencing January 1, 2022, each of the Term Loans will amortize as set forth in the table below, with payments on the first day of each January, April, July and October, with the balance of each Term Loan Facility due at maturity. Installment Dates Original Principal Amount January 1, 2022 through October 1, 2022 1.25 % January 1, 2023 through October 1, 2024 1.88 % January 1, 2025 through July 1, 2026 2.50 % Guarantees The U.S. Term Loan and the obligations of the U.S. Borrower under the Revolving Credit Facility are guaranteed by the Company and all of the U.S. Borrower’s current and future wholly owned domestic material subsidiaries (the “U.S. Subsidiary Guarantors”), subject to certain exceptions. The Canadian Term Loan is guaranteed by the Company, the U.S. Borrower, the U.S. Subsidiary Guarantors and each of the wholly owned Canadian material subsidiaries of the Canadian Borrower, subject to certain exceptions. Security The U.S. Term Loan and the obligations of the U.S. Borrower under the Revolving Credit Facility are secured by a first lien on all of the assets of the Company, the U.S. Borrower and the U.S. Subsidiary Guarantors, including 100% of the capital stock of the U.S. Subsidiary Guarantors and 65% of the capital stock of the first tier material foreign subsidiaries of the Company, the U.S. Borrower and the U.S. Subsidiary Guarantors, subject to certain exceptions. The Canadian Term Loan is secured by a first lien on all of the assets of the Company, the U.S. Borrower, the U.S. Subsidiary Guarantors, the Canadian Borrower and the material Canadian subsidiaries of the Canadian Borrower, including 100% of the capital stock of the Canadian Borrower’s material Canadian subsidiaries. Interest Rates and Fees The U.S. Borrower will have the option to pay interest on the U.S. Term Loan and borrowings under the Revolving Credit Facility at a base rate, plus an applicable margin, or at a rate based on LIBOR plus an applicable margin. The Canadian Borrower will have the option to pay interest on the Canadian Term Loan at a prime rate, plus an applicable margin, or at a rate based on the Canadian Dollar Offered Rate, or "CDOR," plus an applicable margin. Under the applicable Facilities, the margin for base rate loans and Canadian prime rate loans is 62.5 basis points and the applicable margin for LIBOR loans and CDOR loans is 162.5 basis points; provided that, following the completion of one full fiscal quarter after the closing date, the applicable margins will be determined based on a leverage-based performance grid. In addition to paying interest on outstanding principal under the Revolving Credit Facility, the U.S. Borrower is required to pay a commitment fee in respect of unutilized revolving commitments of 0.25% per annum, provided that, following the completion of one full fiscal quarter after the closing date, the commitment fee will be determined based on a leverage-based performance grid. Voluntary Prepayment The Borrowers will be able to voluntarily prepay the principal of the loans outstanding under each of the Facilities without penalty or premium (subject to breakage fees) at any time in whole or in part. Mandatory Prepayment Each Borrower is required to repay its respective Term Loan with certain asset sale and insurance proceeds and certain debt proceeds. Debt Issuance Costs We incurred fees to third parties in connection with our entry into the Credit Agreement described above. The debt issuance costs of $1,265 were capitalized and will be amortized over the life of the Credit Agreement. Additionally, we recognized a loss on debt extinguishment of $2,569, which was recorded to Other income/(expense) on our condensed consolidated statements of operations and comprehensive income/(loss). Financial Covenants In connection with the Credit Agreement, the Company is required, on a consolidated basis, to maintain certain financial covenant ratios. On the last day of any period of four fiscal quarters ending during a period set forth below, the Company must maintain a consolidated leverage ratio that does not exceed the ratios for such period set forth below (each of which ratios may be increased by 0.50:1.00 for each of the four fiscal quarters following certain acquisitions at the election of the U.S. Borrower): Fiscal Quarter Ending Consolidated Leverage Ratio September 30, 2021 through September 30, 2022 3.75:1.00 December 31, 2022 and each fiscal quarter thereafter 3.50:1.00 In addition, on the last day of any period of four fiscal quarters ending on or after September 30, 2021, the Company must maintain a consolidated fixed charge coverage ratio of not less than 1.25:1.00. As of June 30, 2022, we were in compliance with all financial covenants of the Credit Agreement and there is no material uncertainty about our ongoing ability to comply with our covenants. Other Covenants The Credit Agreement contains restrictive covenants (in each case, subject to certain exclusions) that limit, among other things, the ability of the Company and its subsidiaries (including the Borrowers) to: • incur additional indebtedness; • grant liens; • make fundamental changes; • sell assets; • make restricted payments; • enter into sales and leasebacks; • make investments; • prepay certain indebtedness; • enter into transactions with affiliates; and • enter into restrictive agreements. The covenants are subject to various baskets and materiality thresholds, with certain of the baskets to the restrictions on the repayment of subordinated or unsecured indebtedness, restricted payments and investments being available only when the Company’s pro forma leverage ratios are less than a certain level. The Credit Agreement contains certain customary representations and warranties, affirmative covenants and events of default, including, among other things, payment defaults, breach of representations and warranties, covenant defaults, cross-defaults to certain indebtedness, certain events of bankruptcy, certain events under ERISA, judgment defaults, actual or asserted failure of any guaranty or security documents to be in full force and effect and change of control. If such an event of default occurs, the Agent will be entitled to take various actions, including the termination of the commitment for the Revolving Credit Facility, the acceleration of amounts due under the Credit Agreement and certain other actions that a secured creditor is customarily permitted to take following a default. At June 30, 2022, we had $29,000 in outstanding borrowings under the Revolving Credit Facility. We drew down on the Revolving Credit Facility in the ordinary course of business in the amount of $32,000 and paid back $3,000 during the three months ended June 30, 2022. We had $69,048 of available borrowing capacity thereunder after taking into account the borrowing base and $1,952 o f outstanding letters of credit and the outstanding borrowings under the Revolving Credit Facility as of June 30, 2022. The Term Loans bear interest at the LIBOR rate or CDOR rate, as applicable, in each case plus an applicable margin dictated by our leverage ratio (as described above). The interest rates on the Term Loan Facilities on June 30, 2022 were 3.25% for the Canadian Term Loan Facility, and 2.44% for both the U.S. Term Loan Facility and U.S. Revolving Credit Facility. Interest expense has been presented net of interest income on our condensed consolidated statements of operations and comprehensive income/(loss). |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Proceedings and Other Contingencies 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. As of June 30, 2022, management believes that adequate reserves have been established for any probable and reasonably estimable losses. Expenses related to litigation reduce operating income. 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 reporting period. In January 2020, the Company received service of process in a class action application in the Superior Court of Quebec, Montreal, Canada related to certain heating elements previously manufactured by THS and incorporated into certain portable construction heaters sold by certain manufacturers. The Company believes this claim is without merit and intends to vigorously defend itself against the claim. While the Company continues to dispute the allegations, in March 2021, it reached an agreement in principle with the plaintiff and other defendants to resolve this matter without admitting to any liability; such agreement remains subject to the agreement of the parties on the terms of a definitive settlement agreement. Settlement of this matter on the agreed terms will require the Company to contribute an amount that would not have a material impact on the Company’s consolidated financial position, results of operations or cash flows. The settlement is subject to, among other things, approval by the Superior Court. Letters of Credit and Bank Guarantees |
Revenue
Revenue | 3 Months Ended |
Jun. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Disaggregation of Revenue We disaggregate our revenue from contracts with customers by geographic location, as well as revenues recognized at point in time and revenues recognized over time, as we believe these best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Revenue recognized at a point-in-time based on when control goes over to the customer is generally related to our product sales. Point-in-time revenue does not typically require engineering or installation services. Revenue recognized over time occurs on our projects where engineering or installation services, or a combination of the two, are required. We recognize revenue related to such projects in a systematic way that reflects the transfer of goods or services, or a combination of goods and services, to the customer. Disaggregation of revenues from contracts with customers for the three months ended June 30, 2022 and 2021 is as follows: Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Revenues recognized at point in time Revenues recognized over time Total Revenues recognized at point in time Revenues recognized over time Total United States and Latin America $ 23,116 $ 22,477 $ 45,593 $ 13,755 $ 8,901 $ 22,656 Canada 25,131 7,064 32,195 19,096 6,335 25,431 Europe, Middle East and Africa 5,907 4,129 10,036 6,446 8,488 14,934 Asia-Pacific 4,632 2,986 7,618 4,708 3,426 8,134 Total revenues $ 58,786 $ 36,656 $ 95,442 $ 44,005 $ 27,150 $ 71,155 Performance Obligations At June 30, 2022, revenues associated with our open performance obligations totaled $165,047, representing our combined backlog and deferred revenue. Within this amount, approximately $36,596 will be earned as revenue in excess of one year. We expect to recognize the remaining revenues associated with unsatisfied or partially satisfied performance obligations within 12 months. Contract Assets and Liabilities As of June 30, 2022 and March 31, 2022, contract assets were $12,668 and $19,626, respectively. There were no losses recognized on our contract assets for the three months ended June 30, 2022 and 2021. As of June 30, 2022 and March 31, 2022, contract liabilities were $10,865 and $8,010, respectively. The majority of contract liabilities at March 31, 2022 will be recognized as revenue in fiscal 2023. We typically recognize revenue associated with our contract liabilities within 12 months. |
Income Taxes
Income Taxes | 3 Months Ended |
Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our effective income tax rate, after discrete tax events, was a 30.7% provision against income before taxes for the three months ended June 30, 2022 and a provision of 138.5% against income before taxes for the three months ended June 30, 2021. During the three months ended June 30, 2022, the Company recorded a discrete tax expense of $376 related to the foreign exchange impact of estimated withholding taxes in its Russian subsidiary. During the three months ended June 30, 2021, the Company recorded a discrete tax expense of $945 related to an increase in withholding tax rate in its Russian subsidiary. The Company estimates that its effective tax rate will be approximately 26.0% for fiscal year 2023, before discrete tax events. The estimated effective income tax rate represents the weighted average of the estimated tax expense over our global income before tax. As of June 30, 2022, we have established a long-term liability for uncertain tax positions in the amount of $904. As of June 30, 2022, the tax years for the fiscal years ended March 31, 2017 through March 31, 2022 remain open to examination by the major taxing jurisdictions to which we are subject. |
Segment Information
Segment Information | 3 Months Ended |
Jun. 30, 2022 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information We maintain four reportable segments based on four geographic countries or regions in which we operate: (i) United States and Latin America ("US-LAM"), (ii) Canada, (iii) Europe, Middle East and Africa ("EMEA") and (iv) Asia-Pacific ("APAC"). Within our four reportable segments, our core products and services are focused on the following markets: chemical and petrochemical, oil, gas, power generation, commercial, rail and transit, and other, which we refer to as our "key end markets." We offer a full suite of products (heating units, heating cables, industrial heating blankets and related products, temporary power solutions and tubing bundles), services (engineering, installation and maintenance services) and software (design optimization and wireless and network control systems) required to deliver comprehensive solutions to some of the world's largest and most complex projects. 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. 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 June 30, 2022 Three Months Ended June 30, 2021 Sales to External Customers: United States and Latin America $ 45,593 $ 22,656 Canada 32,195 25,431 Europe, Middle East and Africa 10,036 14,934 Asia-Pacific 7,618 8,134 $ 95,442 $ 71,155 Inter-Segment Sales: United States and Latin America $ 6,214 $ 10,697 Canada 3,406 2,769 Europe, Middle East and Africa 2,686 412 Asia-Pacific 1,473 304 $ 13,779 $ 14,182 Depreciation Expense: United States and Latin America $ 1,346 $ 1,484 Canada 1,152 1,420 Europe, Middle East and Africa 93 105 Asia-Pacific 36 46 $ 2,627 $ 3,055 Amortization Expense: United States and Latin America $ 400 $ 295 Canada 1,835 1,906 Europe, Middle East and Africa 21 24 Asia-Pacific 12 11 $ 2,268 $ 2,236 Income/(Loss) from Operations: United States and Latin America $ 11,553 $ (2,645) Canada 4,076 4,031 Europe, Middle East and Africa (2,641) 2,170 Asia-Pacific (63) 1,108 Unallocated: Stock compensation (1,193) (1,178) Public company costs (518) (503) $ 11,214 $ 2,983 June 30, 2022 March 31, 2022 Property, Plant and Equipment, Net: United States and Latin America $ 31,363 $ 31,919 Canada 29,829 30,686 Europe, Middle East and Africa 2,846 2,796 Asia-Pacific 541 638 $ 64,579 $ 66,039 Total Assets: United States and Latin America $ 266,692 $ 241,421 Canada 293,328 296,459 Europe, Middle East and Africa 70,224 67,608 Asia-Pacific 31,687 31,181 $ 661,931 $ 636,669 Capital expenditures for our reportable segments were as follows: Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Capital Expenditures: United States and Latin America $ 243 $ 318 Canada 1,285 528 Europe, Middle East and Africa 81 25 Asia-Pacific 8 2 $ 1,617 $ 873 |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of Estimates | Use of EstimatesGenerally accepted accounting principles 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 management has based their assumptions and estimates on the facts and circumstances existing at June 30, 2022, 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 months ended June 30, 2022 are not necessarily indicative of the results that may be achieved for fiscal |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Business Combinations - In October 2021, the FASB issued Accounting Standards Update, ("ASU") 2021-08 - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers |
Basis of Presentation and Accou
Basis of Presentation and Accounting Policy Information (Tables) | 3 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents, and restricted cash included in prepaid expenses and other current assets and restricted cash included in other long-term assets reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the statements of cash flows. June 30, 2022 March 31, 2022 Cash and cash equivalents $ 40,035 $ 41,445 Restricted cash included in prepaid expenses and other current assets 2,657 2,486 Total cash, cash equivalents, and restricted cash shown in the statements of cash flows $ 42,692 $ 43,931 |
Acquisition (Tables)
Acquisition (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Business Combinations [Abstract] | |
Business Combination, Purchase Price Information | Purchase Price Allocation Amortization Period (years) Fair Value Accounts receivable $ 1,267 Inventories 3,545 Property, plant and equipment 391 Other current assets 290 Other long-term assets 954 Intangibles: Customer relationships 9.8 3,301 Trademarks 9.8 3,397 Contract-based 5.0 1,280 Developed technology 15.8 5,189 Goodwill 18,585 Total fair value of assets acquired $ 38,199 Accounts payable (1,022) Accrued liabilities (637) Other liabilities (1,201) Total fair value of liabilities acquired $ (2,860) Purchase Price $ 35,339 |
Business Acquisition, Pro Forma Information | The pro forma results presented below are adjusted for the removal of acquisition and other related costs of $286 for the three months ended June 30, 2022. Three Months Ended June 30, 2022 Three Months Ended June, 30, 2021 Sales $ 97,324 $ 73,635 Net Income/(loss) 6,162 (295) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of long-term debt that is not measured at fair value | Information about our long-term debt that is not measured at fair value is as follows: June 30, 2022 March 31, 2022 Carrying Fair Value Carrying Fair Value Valuation Technique Financial Assets Deferred compensation plan assets $ 5,799 $ 5,799 $ 5,391 $ 5,391 Level 1 - Active Markets Foreign currency contract forwards assets 9 9 105 105 Level 2 - Market Approach Financial Liabilities Outstanding borrowings from revolving line of credit $ 29,000 $ 29,000 $ — $ — Level 1 - Active Markets Outstanding principal amount of senior secured credit facility 121,837 121,228 129,000 128,355 Level 2 - Market Approach Deferred compensation plan liabilities 5,222 5,222 4,837 4,837 Level 1 - Active Markets Foreign currency contract forwards liabilities 55 55 — — Level 2 - Market Approach |
Schedule of notional amounts of forward contracts held in foreign currencies | As of June 30, 2022 and March 31, 2022, the notional amounts of forward contracts were as follows: Notional amount of foreign currency forward contracts by currency June 30, 2022 March 31, 2022 Canadian Dollar $ 900 $ 4,000 South Korean Won 2,500 2,250 Mexican Peso 1,000 — Australian Dollar 400 1,000 Chinese Renminbi 500 — Total notional amounts $ 5,300 $ 7,250 |
Restructuring and other charg_2
Restructuring and other charges (income) (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | Restructuring and other charges/(income) by reportable segment were as follows: Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 United States and Latin America $ — $ (46) Canada — (186) Europe, Middle East and Africa — (182) Asia-Pacific — — $ — $ (414) |
Net Income_(Loss) per Common _2
Net Income/(Loss) per Common Share (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
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/(loss) per common share for the three months ended June 30, 2022 and 2021, respectively, are as follows: Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Basic net income/(loss) per common share Net income/(loss) $ 6,556 $ (340) Weighted-average common shares outstanding 33,399,868 33,259,804 Basic net income/(loss) per common share $ 0.20 $ (0.01) Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Diluted net income/(loss) per common share Net income/(loss) $ 6,556 $ (340) Weighted-average common shares outstanding 33,399,868 33,259,804 Common share equivalents: Stock options — — Restricted and performance stock units 167,416 — Weighted average shares outstanding – dilutive (1) 33,567,284 33,259,804 Diluted net income/(loss) per common share (2) $ 0.20 $ (0.01) (1) For the three months ended June 30, 2022 and 2021, 179,882 and 65,854 equity awards, respectively, were not included in the calculation of diluted net income/(loss) per common share, as they would have had an anti-dilutive effect. (2) As the Company incurred a net loss for the three months ended June 30, 2021, there was no dilutive effect on net loss per common share as common share equivalents are antidilutive. Therefore, both basic and diluted net loss per common share were $(0.01) for the three months ended June 30, 2021. |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current | Inventories consisted of the following: June 30, 2022 March 31, 2022 Raw materials $ 49,422 $ 41,389 Work in process 5,296 6,294 Finished goods 33,880 25,802 88,598 73,485 Valuation reserves (2,372) (1,835) Inventories, net $ 86,226 $ 71,650 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of carrying amount of goodwill | The carrying amount of goodwill by operating segment as of June 30, 2022 is as follows: United States and Latin America Canada Europe, Middle East and Africa Asia-Pacific Total Balance as of March 31, 2022 $ 62,725 $ 122,318 $ 19,087 $ 8,624 $ 212,754 Goodwill acquired (1) 18,585 — — — 18,585 Foreign currency translation impact — (3,702) (1,142) — (4,844) Balance as of June 30, 2022 $ 81,310 $ 118,616 $ 17,945 $ 8,624 $ 226,495 (1) - Refer to Note 2, "Acquisition" for more information on the goodwill acquired through our recent acquisition. |
Schedule of intangible assets | Our total intangible assets consisted of the following: Gross Carrying Amount at June 30, 2022 Accumulated Amortization Net Carrying Amount at June 30, 2022 Gross Carrying Amount at March 31, 2022 Accumulated Amortization Net Carrying Amount at March 31, 2022 Products $ 64,651 $ (30,170) $ 34,481 $ 66,669 $ (29,445) $ 37,224 Trademarks 47,736 (1,601) 46,135 45,222 (1,517) 43,705 Developed technology 14,933 (5,960) 8,973 9,946 (5,933) 4,013 Customer relationships 114,753 (102,571) 12,182 113,413 (103,900) 9,513 Certifications 444 — 444 453 — 453 Contract-based 1,280 (29) 1,251 — — — Total $ 243,797 $ (140,331) $ 103,466 $ 235,703 $ (140,795) $ 94,908 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of accrued current liabilities | Accrued current liabilities consisted of the following: June 30, 2022 March 31, 2022 Accrued employee compensation and related expenses $ 11,901 $ 16,235 Accrued interest 304 277 Customer prepayments 71 405 Warranty reserves 780 557 Professional fees 2,563 2,540 Sales taxes payable 2,440 2,758 Other (1) 3,209 4,199 Total accrued current liabilities $ 21,268 $ 26,971 (1) - Included in Other are accrued warranty-related costs of $1,746 and $2,523, respectively, associated with the operational execution of a US-LAM project that was completed previously. |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | Long-term debt consisted of the following: June 30, 2022 March 31, 2022 Variable Rate Term Loan A due September 2026 net of deferred debt issuance costs of $588 and $640 as of June 30, 2022 and March 31, 2022, respectively $ 121,249 $ 128,360 Less current portion (8,695) (7,929) Total long-term debt $ 112,554 $ 120,431 |
Long-term debt, stated percentage of facilities | Each of the Facilities terminates on September 29, 2026. Commencing January 1, 2022, each of the Term Loans will amortize as set forth in the table below, with payments on the first day of each January, April, July and October, with the balance of each Term Loan Facility due at maturity. Installment Dates Original Principal Amount January 1, 2022 through October 1, 2022 1.25 % January 1, 2023 through October 1, 2024 1.88 % January 1, 2025 through July 1, 2026 2.50 % |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenues | Disaggregation of revenues from contracts with customers for the three months ended June 30, 2022 and 2021 is as follows: Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Revenues recognized at point in time Revenues recognized over time Total Revenues recognized at point in time Revenues recognized over time Total United States and Latin America $ 23,116 $ 22,477 $ 45,593 $ 13,755 $ 8,901 $ 22,656 Canada 25,131 7,064 32,195 19,096 6,335 25,431 Europe, Middle East and Africa 5,907 4,129 10,036 6,446 8,488 14,934 Asia-Pacific 4,632 2,986 7,618 4,708 3,426 8,134 Total revenues $ 58,786 $ 36,656 $ 95,442 $ 44,005 $ 27,150 $ 71,155 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
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 June 30, 2022 Three Months Ended June 30, 2021 Sales to External Customers: United States and Latin America $ 45,593 $ 22,656 Canada 32,195 25,431 Europe, Middle East and Africa 10,036 14,934 Asia-Pacific 7,618 8,134 $ 95,442 $ 71,155 Inter-Segment Sales: United States and Latin America $ 6,214 $ 10,697 Canada 3,406 2,769 Europe, Middle East and Africa 2,686 412 Asia-Pacific 1,473 304 $ 13,779 $ 14,182 Depreciation Expense: United States and Latin America $ 1,346 $ 1,484 Canada 1,152 1,420 Europe, Middle East and Africa 93 105 Asia-Pacific 36 46 $ 2,627 $ 3,055 Amortization Expense: United States and Latin America $ 400 $ 295 Canada 1,835 1,906 Europe, Middle East and Africa 21 24 Asia-Pacific 12 11 $ 2,268 $ 2,236 Income/(Loss) from Operations: United States and Latin America $ 11,553 $ (2,645) Canada 4,076 4,031 Europe, Middle East and Africa (2,641) 2,170 Asia-Pacific (63) 1,108 Unallocated: Stock compensation (1,193) (1,178) Public company costs (518) (503) $ 11,214 $ 2,983 June 30, 2022 March 31, 2022 Property, Plant and Equipment, Net: United States and Latin America $ 31,363 $ 31,919 Canada 29,829 30,686 Europe, Middle East and Africa 2,846 2,796 Asia-Pacific 541 638 $ 64,579 $ 66,039 Total Assets: United States and Latin America $ 266,692 $ 241,421 Canada 293,328 296,459 Europe, Middle East and Africa 70,224 67,608 Asia-Pacific 31,687 31,181 $ 661,931 $ 636,669 |
Capital expenditures by geographic area | Capital expenditures for our reportable segments were as follows: Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Capital Expenditures: United States and Latin America $ 243 $ 318 Canada 1,285 528 Europe, Middle East and Africa 81 25 Asia-Pacific 8 2 $ 1,617 $ 873 |
Basis of Presentation and Acc_2
Basis of Presentation and Accounting Policy Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2022 | Mar. 31, 2022 | Mar. 31, 2021 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Inventories, net | $ 86,226 | $ 71,650 | ||
Cash and cash equivalents | 40,035 | 41,445 | ||
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows | $ 43,388 | 42,692 | 43,931 | $ 42,450 |
Prepaid Expenses and Other Current Assets | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows | 2,657 | 2,486 | ||
COVID-19 | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Inventories, net | $ 0 | $ 2 | ||
COVID-19 | Cost of Sales | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Adjustments to Income Statement | 701 | |||
COVID-19 | Marketing, general and administrative and engineering | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Adjustments to Income Statement | $ 314 |
Acquisition - Narrative (Detail
Acquisition - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | |
May 31, 2022 | Jun. 30, 2022 | Jun. 30, 2022 | |
Business Acquisition [Line Items] | |||
Increase to net working capital | $ 300 | ||
Powerblanket | |||
Business Acquisition [Line Items] | |||
Revenues | $ 964 | ||
Net income | (268) | ||
Payments to acquire business | $ 35,000 | ||
Transaction costs | 251 | $ 251 | |
Acquisition and other related costs | 286 | ||
Powerblanket | Marketing, general and administrative and engineering | |||
Business Acquisition [Line Items] | |||
Transaction costs | $ 403 | $ 403 |
Acquisition - Purchase Price (D
Acquisition - Purchase Price (Details) - USD ($) $ in Thousands | May 31, 2022 | Jun. 30, 2022 | Mar. 31, 2022 |
Business Acquisition [Line Items] | |||
Goodwill | $ 226,495 | $ 212,754 | |
Powerblanket | |||
Business Acquisition [Line Items] | |||
Accounts receivable | $ 1,267 | ||
Inventories | 3,545 | ||
Property, plant and equipment | 391 | ||
Other current assets | 290 | ||
Other long-term assets | 954 | ||
Goodwill | 18,585 | ||
Total fair value of assets acquired | 38,199 | ||
Accounts payable | (1,022) | ||
Accrued liabilities | (637) | ||
Other liabilities | (1,201) | ||
Total liabilities | (2,860) | ||
Purchase Price | 35,339 | ||
Powerblanket | Customer relationships | |||
Business Acquisition [Line Items] | |||
Intangibles: | $ 3,301 | ||
Amortization Period (years) | 9 years 9 months 18 days | ||
Powerblanket | Trademarks | |||
Business Acquisition [Line Items] | |||
Intangibles: | $ 3,397 | ||
Amortization Period (years) | 9 years 9 months 18 days | ||
Powerblanket | Contract-based | |||
Business Acquisition [Line Items] | |||
Intangibles: | $ 1,280 | ||
Amortization Period (years) | 5 years | ||
Powerblanket | Developed technology | |||
Business Acquisition [Line Items] | |||
Intangibles: | $ 5,189 | ||
Amortization Period (years) | 15 years 9 months 18 days |
Acquisition - Pro Forma Informa
Acquisition - Pro Forma Information (Details) - Thermon Heating Systems Inc. - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Business Acquisition [Line Items] | ||
Sales | $ 97,324 | $ 73,635 |
Net Income/(loss) | $ 6,162 | $ (295) |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Mar. 31, 2022 |
Financial Assets | ||
Deferred compensation plan assets | $ 5,799 | $ 5,391 |
Financial Liabilities | ||
Deferred compensation plan liabilities | 5,222 | 4,837 |
Foreign currency contract forwards liabilities | 55 | 0 |
Foreign Exchange Forward Contracts | ||
Financial Assets | ||
Foreign currency contract forwards assets | 9 | 105 |
Outstanding borrowings from revolving line of credit | ||
Financial Liabilities | ||
Long-term debt, Carrying Value | 29,000 | 0 |
Level 1 - Active Markets | ||
Financial Assets | ||
Deferred compensation plan assets | 5,799 | 5,391 |
Level 1 - Active Markets | Foreign Exchange Forward Contracts | ||
Financial Assets | ||
Foreign currency contract forwards assets | 9 | 105 |
Level 2 - Market Approach | ||
Financial Liabilities | ||
Deferred compensation plan liabilities | 5,222 | 4,837 |
Foreign currency contract forwards liabilities | 55 | 0 |
Level 2 - Market Approach | Outstanding borrowings from revolving line of credit | ||
Financial Liabilities | ||
Long-term debt, Fair Value | 29,000 | 0 |
Loans Payable | ||
Financial Liabilities | ||
Long-term debt, Carrying Value | 121,837 | 129,000 |
Loans Payable | Level 2 - Market Approach | ||
Financial Liabilities | ||
Long-term debt, Fair Value | $ 121,228 | $ 128,355 |
Fair Value Measurements (Deferr
Fair Value Measurements (Deferred compensation plan) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |||
Deferred compensation plan assets | $ 5,799 | $ 5,391 | |
Deferred compensation plan liabilities | 5,222 | $ 4,837 | |
Deferred compensation plan expense/(income) | (660) | $ 332 | |
Unrealized gain (loss) on investments | $ 637 | $ (326) | |
Maximum term of forward contracts | 30 days |
Fair Value Measurements - Forei
Fair Value Measurements - Foreign Exchange Contracts by Currency (Details) - Foreign Exchange Forward Contracts - USD ($) $ in Thousands | Jun. 30, 2022 | Mar. 31, 2022 |
Derivative [Line Items] | ||
Notional amount | $ 5,300 | $ 7,250 |
Canadian Dollar | ||
Derivative [Line Items] | ||
Notional amount | 900 | 4,000 |
South Korean Won | ||
Derivative [Line Items] | ||
Notional amount | 2,500 | 2,250 |
Mexican Peso | ||
Derivative [Line Items] | ||
Notional amount | 1,000 | 0 |
Australian Dollar | ||
Derivative [Line Items] | ||
Notional amount | 400 | 1,000 |
Chinese Renminbi | ||
Derivative [Line Items] | ||
Notional amount | $ 500 | $ 0 |
Fair Value Measurements - For_2
Fair Value Measurements - Foreign Exchange Contracts (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Transaction gains (losses) denominated in foreign currencies | $ 359 | $ (284) |
Foreign Exchange Forward Contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign currency gain (loss) | $ 296 | $ 294 |
Restructuring and other charg_3
Restructuring and other charges (income) - Narrative (Details) $ in Thousands | 12 Months Ended |
Mar. 31, 2022 USD ($) | |
Thermon South Africa Proprieary Limited | |
Restructuring Cost and Reserve [Line Items] | |
Cash recipts | $ (311) |
Canada | |
Restructuring Cost and Reserve [Line Items] | |
Severance costs | $ (103) |
Restructuring and other charg_4
Restructuring and other charges (income) - Restructuring Costs by Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | $ 0 | $ (414) |
United States and Latin America | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | 0 | (46) |
Canada | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | 0 | (186) |
Europe, Middle East and Africa | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | 0 | (182) |
Asia-Pacific | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | $ 0 | $ 0 |
Net Income_(Loss) per Common _3
Net Income/(Loss) per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Basic net income (loss) per common share | ||
Net income/(loss) | $ 6,556 | $ (340) |
Weighted-average common shares outstanding (in shares) | 33,399,868 | 33,259,804 |
Basic net income (loss) per common share (in dollars per share) | $ 0.20 | $ (0.01) |
Diluted net income (loss) per common share | ||
Net income/(loss) | $ 6,556 | $ (340) |
Weighted-average common shares outstanding (in shares) | 33,399,868 | 33,259,804 |
Diluted (in shares) | 33,567,284 | 33,259,804 |
Diluted net income (loss) per common share (in dollars per share) | $ 0.20 | $ (0.01) |
Antidilutive securities excluded from computation of earnings per share (in shares) | 179,882 | 65,854 |
Equity Option | ||
Diluted net income (loss) per common share | ||
Weighted average number of diluted shares outstanding adjustment (in shares) | 0 | 0 |
Restricted Stock Units | ||
Diluted net income (loss) per common share | ||
Weighted average number of diluted shares outstanding adjustment (in shares) | 167,416 | 0 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Mar. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 49,422 | $ 41,389 |
Work in process | 5,296 | 6,294 |
Finished goods | 33,880 | 25,802 |
Inventories, gross | 88,598 | 73,485 |
Valuation reserves | (2,372) | (1,835) |
Inventories, net | $ 86,226 | $ 71,650 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Details) $ in Thousands | 3 Months Ended |
Jun. 30, 2022 USD ($) | |
Goodwill | |
Balance at the beginning of the period | $ 212,754 |
Balance at the end of the period | 226,495 |
Operating Segments | |
Goodwill | |
Balance at the beginning of the period | 212,754 |
Goodwill acquired | 18,585 |
Foreign currency translation impact | (4,844) |
Balance at the end of the period | 226,495 |
Operating Segments | United States and Latin America | |
Goodwill | |
Balance at the beginning of the period | 62,725 |
Goodwill acquired | 18,585 |
Foreign currency translation impact | 0 |
Balance at the end of the period | 81,310 |
Operating Segments | Canada | |
Goodwill | |
Balance at the beginning of the period | 122,318 |
Goodwill acquired | 0 |
Foreign currency translation impact | (3,702) |
Balance at the end of the period | 118,616 |
Operating Segments | Europe, Middle East and Africa | |
Goodwill | |
Balance at the beginning of the period | 19,087 |
Goodwill acquired | 0 |
Foreign currency translation impact | (1,142) |
Balance at the end of the period | 17,945 |
Operating Segments | Asia-Pacific | |
Goodwill | |
Balance at the beginning of the period | 8,624 |
Goodwill acquired | 0 |
Foreign currency translation impact | 0 |
Balance at the end of the period | $ 8,624 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Mar. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, accumulated amortization | $ (140,331) | $ (140,795) |
Intangible assets, gross | 243,797 | 235,703 |
Intangible assets, net | 103,466 | 94,908 |
Certifications | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets (excluding goodwill) | 444 | 453 |
Products | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 64,651 | 66,669 |
Finite-lived intangible assets, accumulated amortization | (30,170) | (29,445) |
Finite-lived intangible assets, net carrying amount | 34,481 | 37,224 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 47,736 | 45,222 |
Finite-lived intangible assets, accumulated amortization | (1,601) | (1,517) |
Finite-lived intangible assets, net carrying amount | 46,135 | 43,705 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 14,933 | 9,946 |
Finite-lived intangible assets, accumulated amortization | (5,960) | (5,933) |
Finite-lived intangible assets, net carrying amount | 8,973 | 4,013 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 114,753 | 113,413 |
Finite-lived intangible assets, accumulated amortization | (102,571) | (103,900) |
Finite-lived intangible assets, net carrying amount | 12,182 | 9,513 |
Contract-based | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 1,280 | 0 |
Finite-lived intangible assets, accumulated amortization | (29) | 0 |
Finite-lived intangible assets, net carrying amount | $ 1,251 | $ 0 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Mar. 31, 2022 |
Payables and Accruals [Abstract] | ||
Accrued employee compensation and related expenses | $ 11,901 | $ 16,235 |
Accrued interest | 304 | 277 |
Customer prepayments | 71 | 405 |
Warranty reserves | 780 | 557 |
Professional fees | 2,563 | 2,540 |
Sales taxes payable | 2,440 | 2,758 |
Other | 3,209 | 4,199 |
Total accrued current liabilities | 21,268 | 26,971 |
Accrued warranty costs | $ 1,746 | $ 2,523 |
Debt (Details)
Debt (Details) $ in Thousands, $ in Thousands | 3 Months Ended | |||
Sep. 29, 2021 USD ($) | Jun. 30, 2022 USD ($) | Mar. 31, 2022 USD ($) | Sep. 29, 2021 CAD ($) | |
Debt Instrument [Line Items] | ||||
Less current portion | $ (8,695) | $ (7,929) | ||
Long-term debt, net | $ 112,554 | 120,431 | ||
Line of credit facility, fixed charge coverage ratio | 125% | |||
Letters of credit outstanding, amount | $ 1,952 | |||
London Interbank Offered Rate (LIBOR) | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 0.625% | |||
CDOR | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 1.625% | |||
September 30, 2021 through September 30, 2022 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, consolidated leverage ratio | 375% | |||
December 31, 2022 and each fiscal quarter thereafter | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, consolidated leverage ratio | 350% | |||
Revolving credit facility | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum borrowing capacity | $ 100,000 | |||
Long-term debt, term | 5 years | 5 years | ||
Long-term line of credit | $ 29,000 | |||
Line of credit facility, accordian feature | $ 100,000 | |||
Line of credit facility, commitment fee percentage | 0.25% | |||
Capacity available under credit facility | 69,048 | |||
Proceeds from issuance of long-term debt | 32,000 | |||
Repayments of debt | 3,000 | |||
Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, term | 5 years | 5 years | ||
Long-term line of credit | $ 76,182 | |||
Line of Credit | January 1, 2022 through October 1, 2022 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate, stated percentage | 1.25% | 1.25% | ||
Line of Credit | January 1, 2023 through October 1, 2024 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate, stated percentage | 1.88% | 1.88% | ||
Line of Credit | January 1, 2025 through July 1, 2026 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate, stated percentage | 2.50% | 2.50% | ||
Variable Rate Term Loan due September 2026 | Loans Payable | ||||
Debt Instrument [Line Items] | ||||
Variable Rate Term Loans | 121,249 | 128,360 | ||
Debt issuance costs, net | $ 588 | $ 640 | ||
U.S. Term Loan | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, term | 5 years | 5 years | ||
Long-term line of credit | $ 80,000 | |||
Variable term loan, interest rate | 2.44% | |||
Canadian Term Loan Facility | ||||
Debt Instrument [Line Items] | ||||
Variable term loan, interest rate | 3.25% | |||
Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Debt issuance costs | $ 1,265 | |||
Loss on extinguishment of debt | $ 2,569 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Totaled arrangements under letter of credit guarantees and performance bonds securing performance obligations | $ 9,610 |
Guarantee obligations secured by cash deposits | 1,207 |
Guarantee obligations represented by a reduction of the available amount of the company's short term and long term revolving lines of credit | 1,952 |
Indian custom bonds outstanding | $ 4,601 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 95,442 | $ 71,155 |
Revenues recognized at point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 58,786 | 44,005 |
Revenues recognized over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 36,656 | 27,150 |
United States and Latin America | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 45,593 | 22,656 |
United States and Latin America | Revenues recognized at point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 23,116 | 13,755 |
United States and Latin America | Revenues recognized over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 22,477 | 8,901 |
Canada | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 32,195 | 25,431 |
Canada | Revenues recognized at point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 25,131 | 19,096 |
Canada | Revenues recognized over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 7,064 | 6,335 |
Europe, Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 10,036 | 14,934 |
Europe, Middle East and Africa | Revenues recognized at point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 5,907 | 6,446 |
Europe, Middle East and Africa | Revenues recognized over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 4,129 | 8,488 |
Asia-Pacific | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 7,618 | 8,134 |
Asia-Pacific | Revenues recognized at point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 4,632 | 4,708 |
Asia-Pacific | Revenues recognized over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 2,986 | $ 3,426 |
Revenue - Performance Obligatio
Revenue - Performance Obligation (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 165,047 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 36,596 |
Remaining performance obligation, period | 1 year |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Mar. 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 12,668 | $ 19,626 |
Contract liabilities | $ 10,865 | $ 8,010 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | Mar. 31, 2023 | |
Income Tax Contingency [Line Items] | |||
Effective tax rate | 30.70% | 138.50% | |
Discrete tax expense | $ 945 | ||
Liability for uncertain tax positions | 904 | ||
Russia | |||
Income Tax Contingency [Line Items] | |||
Discrete tax expense | $ 376 | ||
Scenario, Forecast | |||
Income Tax Contingency [Line Items] | |||
Effective tax rate | 26% |
Segment Information - Narrative
Segment Information - Narrative (Details) | 3 Months Ended |
Jun. 30, 2022 segment Geographic_Region | |
Segment Reporting [Abstract] | |
Number of reportable segments | segment | 4 |
Number of operating segments | Geographic_Region | 4 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Mar. 31, 2022 | |
Sales by geographic area: | |||
Sales | $ 95,442 | $ 71,155 | |
Depreciation | 2,627 | 3,055 | |
Amortization of intangible assets | 2,268 | 2,236 | |
Operating income | |||
Operating income (loss) | 11,214 | 2,983 | |
Property, plant and equipment, net | 64,579 | $ 66,039 | |
Assets | 661,931 | 636,669 | |
Operating Segments | |||
Sales by geographic area: | |||
Sales | 95,442 | 71,155 | |
Intersegment Eliminations | |||
Sales by geographic area: | |||
Sales | 13,779 | 14,182 | |
Segment Reconciling Items | |||
Operating income | |||
Stock compensation | (1,193) | (1,178) | |
Public company costs | (518) | (503) | |
United States and Latin America | |||
Sales by geographic area: | |||
Depreciation | 1,346 | 1,484 | |
Amortization of intangible assets | 400 | 295 | |
Operating income | |||
Operating income (loss) | 11,553 | (2,645) | |
Property, plant and equipment, net | 31,363 | 31,919 | |
Assets | 266,692 | 241,421 | |
United States and Latin America | Operating Segments | |||
Sales by geographic area: | |||
Sales | 45,593 | 22,656 | |
United States and Latin America | Intersegment Eliminations | |||
Sales by geographic area: | |||
Sales | 6,214 | 10,697 | |
Canada | |||
Sales by geographic area: | |||
Depreciation | 1,152 | 1,420 | |
Amortization of intangible assets | 1,835 | 1,906 | |
Operating income | |||
Operating income (loss) | 4,076 | 4,031 | |
Property, plant and equipment, net | 29,829 | 30,686 | |
Assets | 293,328 | 296,459 | |
Canada | Operating Segments | |||
Sales by geographic area: | |||
Sales | 32,195 | 25,431 | |
Canada | Intersegment Eliminations | |||
Sales by geographic area: | |||
Sales | 3,406 | 2,769 | |
Europe, Middle East and Africa | |||
Sales by geographic area: | |||
Depreciation | 93 | 105 | |
Amortization of intangible assets | 21 | 24 | |
Operating income | |||
Operating income (loss) | (2,641) | 2,170 | |
Property, plant and equipment, net | 2,846 | 2,796 | |
Assets | 70,224 | 67,608 | |
Europe, Middle East and Africa | Operating Segments | |||
Sales by geographic area: | |||
Sales | 10,036 | 14,934 | |
Europe, Middle East and Africa | Intersegment Eliminations | |||
Sales by geographic area: | |||
Sales | 2,686 | 412 | |
Asia-Pacific | |||
Sales by geographic area: | |||
Depreciation | 36 | 46 | |
Amortization of intangible assets | 12 | 11 | |
Operating income | |||
Operating income (loss) | (63) | 1,108 | |
Property, plant and equipment, net | 541 | 638 | |
Assets | 31,687 | $ 31,181 | |
Asia-Pacific | Operating Segments | |||
Sales by geographic area: | |||
Sales | 7,618 | 8,134 | |
Asia-Pacific | Intersegment Eliminations | |||
Sales by geographic area: | |||
Sales | $ 1,473 | $ 304 |
Segment Information - Capital E
Segment Information - Capital Expenditures (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Segment Reporting Information [Line Items] | ||
Capital expenditures | $ 1,617 | $ 873 |
United States and Latin America | ||
Segment Reporting Information [Line Items] | ||
Capital expenditures | 243 | 318 |
Canada | ||
Segment Reporting Information [Line Items] | ||
Capital expenditures | 1,285 | 528 |
Europe, Middle East and Africa | ||
Segment Reporting Information [Line Items] | ||
Capital expenditures | 81 | 25 |
Asia-Pacific | ||
Segment Reporting Information [Line Items] | ||
Capital expenditures | $ 8 | $ 2 |