Cover Page
Cover Page - shares | 6 Months Ended | |
Sep. 30, 2023 | Nov. 01, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
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 | |
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Trading Symbol | THR | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 33,696,760 | |
Entity Central Index Key | 0001489096 | |
Current Fiscal Year End Date | --03-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2023 | Mar. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 30,532 | $ 35,635 |
Accounts receivable, net of allowances of $2,812 and $2,682 as of September 30, 2023, and March 31, 2023, respectively | 101,564 | 97,627 |
Inventories, net | 92,550 | 82,132 |
Contract assets | 27,259 | 16,272 |
Prepaid expenses and other current assets | 16,865 | 16,138 |
Income tax receivable | 1,109 | 3,138 |
Total current assets | 269,879 | 250,942 |
Property, plant and equipment, net of depreciation and amortization of $70,610 and $67,450 as of September 30, 2023, and March 31, 2023, respectively | 64,794 | 63,288 |
Goodwill | 218,864 | 219,612 |
Intangible assets, net | 88,018 | 93,970 |
Operating lease right-of-use assets | 12,319 | 13,570 |
Deferred income taxes | 703 | 688 |
Other non-current assets | 9,146 | 7,559 |
Total assets | 663,723 | 649,629 |
Current liabilities: | ||
Accounts payable | 34,603 | 27,330 |
Accrued liabilities | 30,585 | 39,364 |
Current portion of long-term debt | 10,226 | 10,222 |
Borrowings under revolving credit facility | 27,500 | 14,500 |
Contract liabilities | 7,261 | 8,483 |
Lease liabilities | 3,387 | 3,364 |
Income taxes payable | 4,366 | 6,809 |
Total current liabilities | 117,928 | 110,072 |
Long-term debt, net | 72,599 | 87,710 |
Deferred income taxes | 10,438 | 12,084 |
Non-current lease liabilities | 11,389 | 12,479 |
Other non-current liabilities | 9,063 | 8,296 |
Total liabilities | 221,417 | 230,641 |
Commitments and contingencies (Note 10) | ||
Equity | ||
Common stock: $0.001 par value; 150,000,000 authorized; 33,690,712 and 33,508,076 shares issued and outstanding at September 30, 2023 and March 31, 2023, respectively | 34 | 33 |
Preferred stock: $0.001 par value; 10,000,000 authorized; no shares issued and outstanding | 0 | 0 |
Additional paid in capital | 240,833 | 239,860 |
Accumulated other comprehensive loss | (61,424) | (58,100) |
Retained earnings | 262,863 | 237,195 |
Total equity | 442,306 | 418,988 |
Total liabilities and equity | $ 663,723 | $ 649,629 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2023 | Mar. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 2,812 | $ 2,682 |
Depreciation and amortization | $ 70,610 | $ 67,450 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 150,000,000 | 150,000,000 |
Common stock, shares issued (in shares) | 33,690,712 | 33,508,076 |
Common stock, shares outstanding (in shares) | 33,690,712 | 33,508,076 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income/(Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||||
Sales | $ 123,659 | $ 100,557 | $ 230,548 | $ 195,999 |
Cost of sales | 69,201 | 54,631 | 128,781 | 112,848 |
Gross profit | 54,458 | 45,926 | 101,767 | 83,151 |
Operating expenses: | ||||
Selling, general and administrative expenses | 30,490 | 27,754 | 59,144 | 52,157 |
Deferred compensation plan expense/(income) | (247) | (303) | 26 | (963) |
Amortization of intangible assets | 2,227 | 2,437 | 4,614 | 4,705 |
Restructuring and other charges/(income) | 304 | 0 | 885 | 0 |
Income from operations | 21,684 | 16,038 | 37,098 | 27,252 |
Other income/(expenses): | ||||
Interest expense, net | (1,925) | (1,408) | (3,509) | (2,243) |
Other income/(expense) | (267) | (335) | 74 | (1,251) |
Income before provision for income taxes | 19,492 | 14,295 | 33,663 | 23,758 |
Income tax expense | 4,762 | 3,311 | 7,995 | 6,218 |
Net income | 14,730 | 10,984 | 25,668 | 17,540 |
Comprehensive income/(loss): | ||||
Net income | 14,730 | 10,984 | 25,668 | 17,540 |
Foreign currency translation adjustment | (7,845) | (17,811) | (3,388) | (22,963) |
Other miscellaneous income | 51 | 116 | 64 | 118 |
Comprehensive income/(loss) | $ 6,936 | $ (6,711) | $ 22,344 | $ (5,305) |
Net income per common share: | ||||
Basic (in dollars per share) | $ 0.44 | $ 0.33 | $ 0.76 | $ 0.52 |
Diluted (in dollars per share) | $ 0.43 | $ 0.33 | $ 0.75 | $ 0.52 |
Weighted-average shares used in computing net income per common share: | ||||
Basic (in shares) | 33,688,514 | 33,476,695 | 33,748,425 | 33,438,657 |
Diluted (in shares) | 34,126,884 | 33,773,475 | 34,093,791 | 33,611,291 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Employees Common Stock | Executive Officer Common Stock | Director Common Stock |
Beginning balance (in shares) at Mar. 31, 2022 | 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) | (5,152) | ||||||
Other | 3 | 1 | 2 | |||||
Ending balance (in shares) at Jun. 30, 2022 | 33,468,134 | |||||||
Ending balance at Jun. 30, 2022 | 401,252 | $ 33 | 235,190 | 210,085 | (44,056) | |||
Beginning balance (in shares) at Mar. 31, 2022 | 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] | ||||||||
Net income (loss) | 17,540 | |||||||
Ending balance (in shares) at Sep. 30, 2022 | 33,483,608 | |||||||
Ending balance at Sep. 30, 2022 | 395,758 | $ 33 | 236,407 | 221,069 | (61,751) | |||
Beginning balance (in shares) at Jun. 30, 2022 | 33,468,134 | |||||||
Beginning balance at Jun. 30, 2022 | 401,252 | $ 33 | 235,190 | 210,085 | (44,056) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common stock (in shares) | 5,544 | 9,930 | ||||||
Stock compensation expense | 1,251 | 1,251 | ||||||
Repurchase of employee stock units on vesting | (34) | (34) | ||||||
Net income (loss) | 10,984 | 10,984 | ||||||
Foreign currency translation adjustment | (17,811) | (17,811) | ||||||
Other | 116 | 116 | ||||||
Ending balance (in shares) at Sep. 30, 2022 | 33,483,608 | |||||||
Ending balance at Sep. 30, 2022 | $ 395,758 | $ 33 | 236,407 | 221,069 | (61,751) | |||
Beginning balance (in shares) at Mar. 31, 2023 | 33,508,076 | 33,508,076 | ||||||
Beginning balance at Mar. 31, 2023 | $ 418,988 | $ 33 | 239,860 | 237,195 | (58,100) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common stock (in shares) | 73,345 | 93,826 | 5,718 | |||||
Stock compensation expense | 1,238 | 1,238 | ||||||
Repurchase of employee stock units on vesting | (1,685) | (1,685) | ||||||
Net income (loss) | 10,938 | 10,938 | ||||||
Foreign currency translation adjustment | 4,457 | 4,457 | ||||||
Other | 13 | 13 | ||||||
Ending balance (in shares) at Jun. 30, 2023 | 33,680,965 | |||||||
Ending balance at Jun. 30, 2023 | $ 433,949 | $ 33 | 239,413 | 248,133 | (53,630) | |||
Beginning balance (in shares) at Mar. 31, 2023 | 33,508,076 | 33,508,076 | ||||||
Beginning balance at Mar. 31, 2023 | $ 418,988 | $ 33 | 239,860 | 237,195 | (58,100) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income (loss) | $ 25,668 | |||||||
Ending balance (in shares) at Sep. 30, 2023 | 33,690,712 | 33,690,712 | ||||||
Ending balance at Sep. 30, 2023 | $ 442,306 | $ 34 | 240,833 | 262,863 | (61,424) | |||
Beginning balance (in shares) at Jun. 30, 2023 | 33,680,965 | |||||||
Beginning balance at Jun. 30, 2023 | 433,949 | $ 33 | 239,413 | 248,133 | (53,630) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common stock (in shares) | 2,550 | 7,197 | ||||||
Stock compensation expense | 1,450 | 1,450 | ||||||
Repurchase of employee stock units on vesting | (30) | (30) | ||||||
Net income (loss) | 14,730 | 14,730 | ||||||
Foreign currency translation adjustment | (7,845) | (7,845) | ||||||
Other | $ 52 | $ 1 | 51 | |||||
Ending balance (in shares) at Sep. 30, 2023 | 33,690,712 | 33,690,712 | ||||||
Ending balance at Sep. 30, 2023 | $ 442,306 | $ 34 | $ 240,833 | $ 262,863 | $ (61,424) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Operating activities | ||
Net income | $ 25,668 | $ 17,540 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 8,802 | 9,852 |
Amortization of deferred debt issuance costs | 174 | 152 |
Stock compensation expense | 2,688 | 2,444 |
Deferred income taxes | (1,562) | (1,749) |
Reserve for uncertain tax positions, net | 39 | 20 |
Remeasurement (gain)/loss on intercompany balances | (226) | 530 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (4,157) | (8,577) |
Inventories | (11,569) | (22,013) |
Contract assets and liabilities | (12,103) | 10,100 |
Other current and non-current assets | (3,023) | (3,677) |
Accounts payable | 7,536 | 7,369 |
Accrued liabilities and non-current liabilities | (7,607) | (2,807) |
Income taxes payable and receivable | (400) | 3,347 |
Net cash provided by operating activities | 4,260 | 12,531 |
Investing activities | ||
Purchases of property, plant and equipment | (5,608) | (3,614) |
Sale of rental equipment | 34 | 103 |
Cash paid for acquisitions, net of cash acquired | 0 | (35,299) |
Net cash used in investing activities | (5,574) | (38,810) |
Financing activities | ||
Proceeds from revolving credit facility | 13,000 | 32,000 |
Payments on revolving credit facility | 0 | (3,000) |
Payments on long-term debt | (15,381) | |
Repurchase of employee stock units on vesting | (1,715) | (586) |
Payments on finance leases | (500) | (30) |
Net cash provided by/(used in) financing activities | (4,596) | 17,943 |
Less: Net change in cash balances classified as assets held-for-sale | 905 | 0 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (583) | (1,050) |
Change in cash, cash equivalents and restricted cash | (5,588) | (9,386) |
Cash, cash equivalents and restricted cash at beginning of period | 38,520 | 43,931 |
Cash, cash equivalents and restricted cash at end of period | $ 32,932 | $ 34,545 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Sep. 30, 2023 | |
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, 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. 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, 2023 ("fiscal 2023"). In our opinion, the accompanying condensed consolidated financial statements reflect all adjustments considered necessary to present fairly our financial position at September 30, 2023 and March 31, 2023, and the results of our operations for the three and six months ended September 30, 2023 and 2022. 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 its assumptions and estimates on the facts and circumstances existing at September 30, 2023, actual results could differ from those estimates and affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities and the corresponding revenues and expenses as of the date of the financial statements. The operating results for the three and six months ended September 30, 2023, are not necessarily indicative of the results that may be achieved for fiscal 2024. 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 non-current 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. September 30, 2023 March 31, 2023 Cash and cash equivalents $ 30,532 $ 35,635 Restricted cash included in prepaid expenses and other current assets 2,365 2,859 Restricted cash included in other non-current assets 35 26 Total cash, cash equivalents, and restricted cash shown in the statements of cash flows $ 32,932 $ 38,520 Amounts shown in restricted cash included in prepaid expenses and other current assets and other non-current assets represent those required to be set aside by a contractual agreement, which generally contain cash deposits pledged as collateral on performance bonds and letters of credit. Amounts shown in restricted cash in other non-current 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 . This update requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities (deferred revenue) from acquired contracts using the revenue recognition guidance in Accounting Standards Codification, or "ASC," 606. Under this "ASC 606 approach," the acquirer applies the revenue model as if it had originated the contracts. This is a departure from the current requirement to measure contract assets and contract liabilities at fair value. The ASU is effective for all public business entities in annual and interim periods starting after December 15, 2022, and early adoption is permitted. We adopted this standard on April 1, 2023, and the adoption did not have a material impact on our consolidated financial statements. |
Acquisition
Acquisition | 6 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [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. 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. The initial purchase price for the Acquisition was $35,000, 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 $299 for net working capital acquired. 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 $278, of which $126 were recognized in fiscal 2023. No costs related to the Acquisition have been recognized in fiscal 2024. 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. For valuing the customer relationships intangible asset, we used a common income-based approach called the multi-period excess earnings method; for the trademarks and developed technology intangible assets, we used a relief-from-royalty method; and for the contract-based intangible asset, we used the with and without method. The carrying values of inventories, property, plant and equipment as well as leased assets approximated their respective fair values at the time of closing. 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 non-current 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 18,620 Total fair value of assets acquired $ 38,234 Accounts payable (1,098) Accrued liabilities (637) Other liabilities (1,200) Total fair value of liabilities acquired $ (2,935) Purchase price $ 35,299 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 $126 which were incurred in our first fiscal quarter ended June 30, 2022. Three Months Ended September 30, 2023 Three Months Ended September 30, 2022 Six Months Ended September 30, 2023 Six Months Ended September 30, 2022 Sales $ 123,659 $ 100,557 $ 230,548 $ 197,863 Net income 14,730 10,984 25,668 17,257 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Sep. 30, 2023 | |
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 September 30, 2023 and March 31, 2023, no assets or liabilities were valued using Level 3 criteria, except for those acquired in our recent acquisition of Powerblanket, discussed in Note 2, "Acquisition." Information about our financial assets and liabilities is as follows: September 30, 2023 March 31, 2023 Carrying Fair Value Carrying Fair Value Valuation Technique Financial Assets: Deferred compensation plan assets $ 7,103 $ 7,103 $ 6,350 $ 6,350 Level 1 - Active Markets Foreign currency contract forwards assets — — 60 60 Level 2 - Market Approach Financial Liabilities: Outstanding borrowings from revolving line of credit $ 27,500 $ 27,500 $ 14,500 $ 14,500 Level 2 - Market Approach Outstanding principal amount of senior secured credit facility 83,139 82,931 98,361 98,115 Level 2 - Market Approach Deferred compensation plan liabilities 6,400 6,400 5,671 5,671 Level 1 - Active Markets Foreign currency contract forwards liabilities 70 70 26 26 Level 2 - Market Approach At September 30, 2023 and March 31, 2023, 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 non-current assets” in the condensed consolidated balance sheets at September 30, 2023 and March 31, 2023 were $7,103 and $6,350, 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 $6,400 and $5,671 included in “Other non-current liabilities” in the condensed consolidated balance sheets at September 30, 2023 and March 31, 2023, 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 $(247) and $(303) for the three months ended September 30, 2023 and 2022, respectively, and $26 and $(963) for the six months ended September 30, 2023 and 2022, 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/expense" on our condensed consolidated statements of operations and comprehensive income/(loss). Our unrealized losses and (gains) on investments were $234 and $296, respectively, for the three months ended September 30, 2023 and 2022, respectively, and $(50) and $934 for the six months ended September 30, 2023 and 2022, 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/(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 September 30, 2023 and March 31, 2023, the notional amounts of forward contracts were as follows: Notional amount of foreign currency forward contracts by currency September 30, 2023 March 31, 2023 Canadian Dollar $ 2,500 $ 4,500 South Korean Won 2,000 1,500 Mexican Peso 1,500 — Chinese Renminbi — 500 Great Britain Pound — 500 Total notional amounts $ 6,000 $ 7,000 In the three and six months ended September 30, 2023 and 2022, 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 $(148) and $(252), respectively, and a gain of $28 and a loss of $(612), 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. In the three and six months ended September 30, 2023 and 2022, our net foreign currency transactions resulted in losses of $(38) and $(37), respectively, and $(13) and $(333), respectively. |
Restructuring and Other Charges
Restructuring and Other Charges/(Income) | 6 Months Ended |
Sep. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Other Charges/(Income) | Restructuring and Other Charges/(Income) Fiscal 2024 charges/(income) As a result of the continued impact of the Russo-Ukrainian war, including the sanctions related thereto, the Company commenced a strategic assessment of its operations in its Russian subsidiary. On January 31, 2023, our board of directors authorized the Company to withdraw from its operations in the Russian Federation (the “Russia Exit”), through a planned disposition of its Russian subsidiary. In fiscal 2023, we moved the assets related to our Russian subsidiary into a separate asset group deemed as "assets held-for-sale," and wrote down the related net assets to a nominal value. In the three and six months ended September 30, 2023, pursuant to requirements to remeasure the assets-held-for-sale, we recognized total charges related to the Russia Exit of $304 and $885, respectively, recorded to "Restructuring and other charges/(income)" on our condensed consolidated statement of operations and comprehensive income/(loss). This brings the total charge from fiscal 2023 and fiscal 2024 associated with the Russia Exit to $13,282. All charges described above were recorded in our Europe, Middle East and Africa ("EMEA") reportable segment. |
Net Income per Common Share
Net Income per Common Share | 6 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Net Income per Common Share | Net Income per Common Share The reconciliations of the denominators used to calculate basic and diluted net income per common share for the three and six months ended September 30, 2023 and 2022, respectively, are as follows: Three Months Ended September 30, 2023 Three Months Ended September 30, 2022 Six Months Ended September 30, 2023 Six Months Ended September 30, 2022 Basic net income per common share Net income $ 14,730 $ 10,984 $ 25,668 $ 17,540 Weighted-average common shares outstanding 33,688,514 33,476,695 33,748,425 33,438,657 Basic net income per common share $ 0.44 $ 0.33 $ 0.76 $ 0.52 Three Months Ended September 30, 2023 Three Months Ended September 30, 2022 Six Months Ended September 30, 2023 Six Months Ended September 30, 2022 Diluted net income per common share Net income $ 14,730 $ 10,984 $ 25,668 $ 17,540 Weighted-average common shares outstanding 33,688,514 33,476,695 33,748,425 33,438,657 Common share equivalents: Stock options 29,108 1,536 25,209 — Restricted and performance stock units 409,262 295,244 320,157 172,634 Weighted average shares outstanding – dilutive (1) 34,126,884 33,773,475 34,093,791 33,611,291 Diluted net income per common share $ 0.43 $ 0.33 $ 0.75 $ 0.52 (1) For the three months ended September 30, 2023 and 2022, zero and 36,310, respectively, were not included in the calculation of diluted net income per common share, as they would have had an anti-dilutive effect. For the six months ended September 30, 2023 and 2022 1,633 and 113,559 equity awards, respectively, were not included in the calculation of diluted net income per common share, as they would have had an anti-dilutive effect. 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 per common share until such time that it is probable that actual performance will be above or below target. |
Inventories
Inventories | 6 Months Ended |
Sep. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following: September 30, 2023 March 31, 2023 Raw materials $ 59,070 $ 53,845 Work in process 5,213 5,338 Finished goods 34,478 29,511 98,761 88,694 Valuation reserves (6,211) (6,562) Inventories, net $ 92,550 $ 82,132 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 6 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible AssetsThe carrying amount of goodwill by operating segment as of September 30, 2023, is as follows: United States and Latin America Canada Europe, Middle East and Africa Asia-Pacific Total Balance as of March 31, 2023 $ 81,345 $ 112,945 $ 18,679 $ 6,643 $ 219,612 Foreign currency translation impact — 109 (522) (335) (748) Balance as of September 30, 2023 $ 81,345 $ 113,054 $ 18,157 $ 6,308 $ 218,864 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. Our total intangible assets consisted of the following: Gross Carrying Amount at September 30, 2023 Accumulated Amortization Net Carrying Amount at September 30, 2023 Gross Carrying Amount at March 31, 2023 Accumulated Amortization Net Carrying Amount at March 31, 2023 Products $ 61,619 $ (36,458) $ 25,161 $ 61,560 $ (33,344) $ 28,216 Trademarks 46,141 (2,281) 43,860 47,427 (2,031) 45,396 Developed technology 14,568 (6,726) 7,842 14,862 (6,520) 8,342 Customer relationships 112,979 (103,190) 9,789 113,259 (102,743) 10,516 Certifications 427 — 427 441 — 441 Other 1,280 (341) 939 1,280 (221) 1,059 Total $ 237,014 $ (148,996) $ 88,018 $ 238,829 $ (144,859) $ 93,970 |
Accrued Liabilities
Accrued Liabilities | 6 Months Ended |
Sep. 30, 2023 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued Liabilities Accrued current liabilities consisted of the following: September 30, 2023 March 31, 2023 Accrued employee compensation and related expenses $ 13,012 $ 17,709 Accrued interest 72 414 Customer prepayments 82 89 Warranty reserves 1,053 758 Professional fees 2,197 2,696 Sales taxes payable 3,802 4,301 Accrued litigation payable (1) 4,187 5,880 Other (2) 6,180 7,517 Total accrued current liabilities $ 30,585 $ 39,364 (1) - The Company has insurance receivables recorded to Prepaid expenses and other current assets on our condensed consolidated balance sheets relating to and materially offsetting the accrued litigation payable noted above. (2) - Other includes approximately $3,384 of non-cash, foreign currency translation impacts related to the Russia Exit. Once the disposition of our Russian affiliate is complete, this balance will be offset against accumulated other comprehensive loss on our condensed consolidated Balance Sheet. |
Debt
Debt | 6 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt | DebtLong-term debt consisted of the following: September 30, 2023 March 31, 2023 Variable Rate Term Loan A due September 2026, net of deferred debt issuance costs of $314 and $429 as of September 30, 2023, and March 31, 2023, respectively $ 82,825 $ 97,932 Less current portion (10,226) (10,222) Total long-term debt $ 72,599 $ 87,710 Senior Secured Credit Facilities On September 29, 2021, Thermon Group Holdings, Inc. as a credit party and a guarantor, Thermon Holding Corp. (the “US Borrower”) and Thermon Canada Inc. (the “Canadian Borrower” and together with the US Borrower, the “Borrowers”), entered into an Amended and Restated Credit Agreement with several banks and other financial institutions or entities from time to time and JPMorgan Chase Bank, N.A., as Administrative Agent, ("the Agent") which was further amended on November 19, 2021 and March 7, 2023. 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-year secured revolving credit facility made available to the U.S. Borrower. The Revolving Credit Facility includes sub-limits for letters of credit and swing-line loans (the “Revolving Credit Facility”). • U.S. Term Loan Facility: A USD $80,000 five-year secured term loan A (the “U.S. Term Loan”) made available to the U.S. Borrower (the “U.S. Term Loan Facility”); and • Canadian Term Loan Facility: A CAD $76,182 five-year term loan A (the “Canadian Term Loan” and, together with the U.S. Term Loan, the “Term Loans”) made available to the Canadian Borrower (the “Canadian Term Loan Facility,” and together with the U.S. Term Loan Facility, the “Term Loan Facilities”). 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. 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. 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 December 31, 2022, and each fiscal quarter thereafter 3.5:1.00 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 September 30, 2023, we were in compliance with all financial covenants of the Credit Agreement. 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 September 30, 2023, we had $27,500 in outstanding borrowings under the Revolving Credit Facility. We had $70,099 of available borrowing capacity thereunder after taking into account the borrowing base and $2,401 of outstanding letters of credit and the outstanding borrowings under the Revolving Credit Facility as of September 30, 2023. The Term Loans bear interest at the Secured Overnight Financing Rate ("SOFR"), or Canadian Dollar Offer Rate ("CDOR"), 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 September 30, 2023 were 6.73% for the Canadian Term Loan Facility, 6.68% for the U.S. Term Loan Facility, and 6.68% for the 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 | 6 Months Ended |
Sep. 30, 2023 | |
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 September 30, 2023, we have established an estimated liability associated with the aforementioned disputes. 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 Thermon Heating Systems 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 | 6 Months Ended |
Sep. 30, 2023 | |
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 transfers 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 and six months ended September 30, 2023 and 2022 is as follows: Three Months Ended September 30, 2023 Three Months Ended September 30, 2022 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 $ 31,744 $ 32,053 $ 63,797 $ 24,749 $ 22,685 $ 47,434 Canada 25,625 10,524 36,149 25,656 9,127 34,783 Europe, Middle East and Africa 7,819 5,588 13,407 5,261 4,282 9,543 Asia-Pacific 7,447 2,859 10,306 6,665 2,132 8,797 Total revenues $ 72,635 $ 51,024 $ 123,659 $ 62,331 $ 38,226 $ 100,557 Six months ended September 30, 2023 Six months ended September 30, 2022 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 $ 61,635 $ 55,659 $ 117,294 $ 47,865 $ 45,162 $ 93,027 Canada 50,147 21,325 71,472 50,787 16,191 66,978 Europe, Middle East and Africa 13,212 9,876 23,088 11,168 8,411 19,579 Asia-Pacific 12,786 5,908 18,694 11,297 5,118 16,415 Total revenues $ 137,780 $ 92,768 $ 230,548 $ 121,117 $ 74,882 $ 195,999 Performance Obligations At September 30, 2023, revenues to be recorded associated with our open performance obligations totaled $166,869. Within this amount, approximately $13,988 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 |
Income Taxes
Income Taxes | 6 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our effective income tax rate was 23.8% and 26.2% for the six months ended September 30, 2023 and 2022, respectively. The Company recorded a discrete tax benefit of $197 in the six months ended September 30, 2023, and a discrete tax expense of $343 related to various matters in the six months ended September 30, 2022. The discrete tax items for both periods include realized stock compensation and the foreign exchange impact of certain deferred tax matters. As of September 30, 2023, we have established a long-term liability for uncertain tax positions in the amount of $1,001. As of September 30, 2023, the tax years for the fiscal years ended March 31, 2018 through March 31, 2023, remain open to examination by the major taxing jurisdictions. |
Segment Information
Segment Information | 6 Months Ended |
Sep. 30, 2023 | |
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, food and beverage, 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 September 30, 2023 Three Months Ended September 30, 2022 Six Months Ended September 30, 2023 Six Months Ended September 30, 2022 Sales to External Customers: United States and Latin America $ 63,797 $ 47,434 $ 117,294 $ 93,027 Canada 36,149 34,783 71,472 66,978 Europe, Middle East and Africa 13,407 9,543 23,088 19,579 Asia-Pacific 10,306 8,797 18,694 16,415 $ 123,659 $ 100,557 $ 230,548 $ 195,999 Inter-Segment Sales: United States and Latin America $ 11,269 $ 11,841 $ 19,650 $ 22,742 Canada 3,851 3,304 8,583 6,656 Europe, Middle East and Africa 286 234 675 656 Asia-Pacific 422 433 1,533 812 $ 15,828 $ 15,812 $ 30,441 $ 30,866 Depreciation Expense: United States and Latin America $ 1,108 $ 1,240 $ 2,164 $ 2,587 Canada 937 1,148 1,848 2,300 Europe, Middle East and Africa 51 96 98 189 Asia-Pacific 40 35 78 71 $ 2,136 $ 2,519 $ 4,188 $ 5,147 Amortization Expense: United States and Latin America $ 449 $ 599 $ 1,060 $ 999 Canada 1,745 1,795 3,488 3,630 Europe, Middle East and Africa 22 20 44 42 Asia-Pacific 11 23 22 34 $ 2,227 $ 2,437 $ 4,614 $ 4,705 Income from Operations: United States and Latin America $ 12,009 $ 6,163 $ 24,290 $ 17,716 Canada 7,520 8,700 11,058 12,776 Europe, Middle East and Africa 2,333 1,079 2,667 (1,562) Asia-Pacific 1,769 1,809 2,676 1,746 Unallocated: Stock compensation (1,450) (1,251) (2,688) (2,444) Public company costs (497) (462) (905) (980) $ 21,684 $ 16,038 $ 37,098 $ 27,252 September 30, 2023 March 31, 2023 Property, Plant and Equipment, Net: United States and Latin America $ 33,499 $ 31,918 Canada 28,398 28,369 Europe, Middle East and Africa 2,248 2,366 Asia-Pacific 649 635 $ 64,794 $ 63,288 Total Assets: United States and Latin America $ 279,738 $ 270,404 Canada 280,653 287,221 Europe, Middle East and Africa 61,074 57,680 Asia-Pacific 42,258 34,324 $ 663,723 $ 649,629 Capital expenditures for our reportable segments were as follows: Three Months Ended September 30, 2023 Three Months Ended September 30, 2022 Six Months Ended Six Months Ended Capital Expenditures: United States and Latin America $ 1,719 $ 1,180 $ 3,546 $ 1,423 Canada 996 715 1,906 2,000 Europe, Middle East and Africa 4 51 37 132 Asia-Pacific 88 51 119 59 $ 2,807 $ 1,997 $ 5,608 $ 3,614 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Sep. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 6 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting | 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, 2023 ("fiscal 2023"). In our opinion, the accompanying condensed consolidated financial statements reflect all adjustments considered necessary to present fairly our financial position at September 30, 2023 and March 31, 2023, and the results of our operations for the three and six months ended September 30, 2023 and 2022 |
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 its assumptions and estimates on the facts and circumstances existing at September 30, 2023, actual results could differ from those estimates and affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities and the corresponding revenues and expenses as of the date of the financial statements. The operating results for the three and six months ended September 30, 2023, are not necessarily indicative of the results that may be achieved for fiscal 2024 |
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 . This update requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities (deferred revenue) from acquired contracts using the revenue recognition guidance in Accounting Standards Codification, or "ASC," 606. Under this "ASC 606 approach," the acquirer applies the revenue model as if it had originated the contracts. This is a departure from the current requirement to measure contract assets and contract liabilities at fair value. The ASU is effective for all public business entities in annual and interim periods starting after December 15, 2022, and early adoption is permitted. We adopted this standard on April 1, 2023, and the adoption did not have a material impact on our consolidated financial statements. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 6 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Restricted 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 non-current 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. September 30, 2023 March 31, 2023 Cash and cash equivalents $ 30,532 $ 35,635 Restricted cash included in prepaid expenses and other current assets 2,365 2,859 Restricted cash included in other non-current assets 35 26 Total cash, cash equivalents, and restricted cash shown in the statements of cash flows $ 32,932 $ 38,520 |
Acquisition (Tables)
Acquisition (Tables) | 6 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Purchase Price Allocation | 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 non-current 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 18,620 Total fair value of assets acquired $ 38,234 Accounts payable (1,098) Accrued liabilities (637) Other liabilities (1,200) Total fair value of liabilities acquired $ (2,935) Purchase price $ 35,299 |
Schedule of Unaudited Pro Forma Information | The pro forma results presented below are adjusted for the removal of acquisition and other related costs of $126 which were incurred in our first fiscal quarter ended June 30, 2022. Three Months Ended September 30, 2023 Three Months Ended September 30, 2022 Six Months Ended September 30, 2023 Six Months Ended September 30, 2022 Sales $ 123,659 $ 100,557 $ 230,548 $ 197,863 Net income 14,730 10,984 25,668 17,257 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Information About Our Financial Assets and Liabilities | Information about our financial assets and liabilities is as follows: September 30, 2023 March 31, 2023 Carrying Fair Value Carrying Fair Value Valuation Technique Financial Assets: Deferred compensation plan assets $ 7,103 $ 7,103 $ 6,350 $ 6,350 Level 1 - Active Markets Foreign currency contract forwards assets — — 60 60 Level 2 - Market Approach Financial Liabilities: Outstanding borrowings from revolving line of credit $ 27,500 $ 27,500 $ 14,500 $ 14,500 Level 2 - Market Approach Outstanding principal amount of senior secured credit facility 83,139 82,931 98,361 98,115 Level 2 - Market Approach Deferred compensation plan liabilities 6,400 6,400 5,671 5,671 Level 1 - Active Markets Foreign currency contract forwards liabilities 70 70 26 26 Level 2 - Market Approach |
Schedule of Notional Amounts of Forward Contracts | As of September 30, 2023 and March 31, 2023, the notional amounts of forward contracts were as follows: Notional amount of foreign currency forward contracts by currency September 30, 2023 March 31, 2023 Canadian Dollar $ 2,500 $ 4,500 South Korean Won 2,000 1,500 Mexican Peso 1,500 — Chinese Renminbi — 500 Great Britain Pound — 500 Total notional amounts $ 6,000 $ 7,000 |
Net Income per Common Share (Ta
Net Income per Common Share (Tables) | 6 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliations of the Denominators Used to Calculate Basic and Diluted Net Income Per Common Share | The reconciliations of the denominators used to calculate basic and diluted net income per common share for the three and six months ended September 30, 2023 and 2022, respectively, are as follows: Three Months Ended September 30, 2023 Three Months Ended September 30, 2022 Six Months Ended September 30, 2023 Six Months Ended September 30, 2022 Basic net income per common share Net income $ 14,730 $ 10,984 $ 25,668 $ 17,540 Weighted-average common shares outstanding 33,688,514 33,476,695 33,748,425 33,438,657 Basic net income per common share $ 0.44 $ 0.33 $ 0.76 $ 0.52 Three Months Ended September 30, 2023 Three Months Ended September 30, 2022 Six Months Ended September 30, 2023 Six Months Ended September 30, 2022 Diluted net income per common share Net income $ 14,730 $ 10,984 $ 25,668 $ 17,540 Weighted-average common shares outstanding 33,688,514 33,476,695 33,748,425 33,438,657 Common share equivalents: Stock options 29,108 1,536 25,209 — Restricted and performance stock units 409,262 295,244 320,157 172,634 Weighted average shares outstanding – dilutive (1) 34,126,884 33,773,475 34,093,791 33,611,291 Diluted net income per common share $ 0.43 $ 0.33 $ 0.75 $ 0.52 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Sep. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories consisted of the following: September 30, 2023 March 31, 2023 Raw materials $ 59,070 $ 53,845 Work in process 5,213 5,338 Finished goods 34,478 29,511 98,761 88,694 Valuation reserves (6,211) (6,562) Inventories, net $ 92,550 $ 82,132 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Carrying Amount of Goodwill | The carrying amount of goodwill by operating segment as of September 30, 2023, is as follows: United States and Latin America Canada Europe, Middle East and Africa Asia-Pacific Total Balance as of March 31, 2023 $ 81,345 $ 112,945 $ 18,679 $ 6,643 $ 219,612 Foreign currency translation impact — 109 (522) (335) (748) Balance as of September 30, 2023 $ 81,345 $ 113,054 $ 18,157 $ 6,308 $ 218,864 |
Schedule of Intangible Assets | Our total intangible assets consisted of the following: Gross Carrying Amount at September 30, 2023 Accumulated Amortization Net Carrying Amount at September 30, 2023 Gross Carrying Amount at March 31, 2023 Accumulated Amortization Net Carrying Amount at March 31, 2023 Products $ 61,619 $ (36,458) $ 25,161 $ 61,560 $ (33,344) $ 28,216 Trademarks 46,141 (2,281) 43,860 47,427 (2,031) 45,396 Developed technology 14,568 (6,726) 7,842 14,862 (6,520) 8,342 Customer relationships 112,979 (103,190) 9,789 113,259 (102,743) 10,516 Certifications 427 — 427 441 — 441 Other 1,280 (341) 939 1,280 (221) 1,059 Total $ 237,014 $ (148,996) $ 88,018 $ 238,829 $ (144,859) $ 93,970 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 6 Months Ended |
Sep. 30, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Current Liabilities | Accrued current liabilities consisted of the following: September 30, 2023 March 31, 2023 Accrued employee compensation and related expenses $ 13,012 $ 17,709 Accrued interest 72 414 Customer prepayments 82 89 Warranty reserves 1,053 758 Professional fees 2,197 2,696 Sales taxes payable 3,802 4,301 Accrued litigation payable (1) 4,187 5,880 Other (2) 6,180 7,517 Total accrued current liabilities $ 30,585 $ 39,364 (1) - The Company has insurance receivables recorded to Prepaid expenses and other current assets on our condensed consolidated balance sheets relating to and materially offsetting the accrued litigation payable noted above. (2) - Other includes approximately $3,384 of non-cash, foreign currency translation impacts related to the Russia Exit. Once the disposition of our Russian affiliate is complete, this balance will be offset against accumulated other comprehensive loss on our condensed consolidated Balance Sheet. |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | Long-term debt consisted of the following: September 30, 2023 March 31, 2023 Variable Rate Term Loan A due September 2026, net of deferred debt issuance costs of $314 and $429 as of September 30, 2023, and March 31, 2023, respectively $ 82,825 $ 97,932 Less current portion (10,226) (10,222) Total long-term debt $ 72,599 $ 87,710 Each of the Facilities terminates on September 29, 2026. 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 % Fiscal Quarter Ending Consolidated Leverage Ratio December 31, 2022, and each fiscal quarter thereafter 3.5:1.00 |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenues | Disaggregation of revenues from contracts with customers for the three and six months ended September 30, 2023 and 2022 is as follows: Three Months Ended September 30, 2023 Three Months Ended September 30, 2022 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 $ 31,744 $ 32,053 $ 63,797 $ 24,749 $ 22,685 $ 47,434 Canada 25,625 10,524 36,149 25,656 9,127 34,783 Europe, Middle East and Africa 7,819 5,588 13,407 5,261 4,282 9,543 Asia-Pacific 7,447 2,859 10,306 6,665 2,132 8,797 Total revenues $ 72,635 $ 51,024 $ 123,659 $ 62,331 $ 38,226 $ 100,557 Six months ended September 30, 2023 Six months ended September 30, 2022 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 $ 61,635 $ 55,659 $ 117,294 $ 47,865 $ 45,162 $ 93,027 Canada 50,147 21,325 71,472 50,787 16,191 66,978 Europe, Middle East and Africa 13,212 9,876 23,088 11,168 8,411 19,579 Asia-Pacific 12,786 5,908 18,694 11,297 5,118 16,415 Total revenues $ 137,780 $ 92,768 $ 230,548 $ 121,117 $ 74,882 $ 195,999 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Total Sales and Operating Income Classified by Major Geographic Area | Total sales to external customers, inter-segment sales, depreciation expense, amortization expense, income from operations, property, plant and equipment, net and total assets for each of our four reportable segments are as follows: Three Months Ended September 30, 2023 Three Months Ended September 30, 2022 Six Months Ended September 30, 2023 Six Months Ended September 30, 2022 Sales to External Customers: United States and Latin America $ 63,797 $ 47,434 $ 117,294 $ 93,027 Canada 36,149 34,783 71,472 66,978 Europe, Middle East and Africa 13,407 9,543 23,088 19,579 Asia-Pacific 10,306 8,797 18,694 16,415 $ 123,659 $ 100,557 $ 230,548 $ 195,999 Inter-Segment Sales: United States and Latin America $ 11,269 $ 11,841 $ 19,650 $ 22,742 Canada 3,851 3,304 8,583 6,656 Europe, Middle East and Africa 286 234 675 656 Asia-Pacific 422 433 1,533 812 $ 15,828 $ 15,812 $ 30,441 $ 30,866 Depreciation Expense: United States and Latin America $ 1,108 $ 1,240 $ 2,164 $ 2,587 Canada 937 1,148 1,848 2,300 Europe, Middle East and Africa 51 96 98 189 Asia-Pacific 40 35 78 71 $ 2,136 $ 2,519 $ 4,188 $ 5,147 Amortization Expense: United States and Latin America $ 449 $ 599 $ 1,060 $ 999 Canada 1,745 1,795 3,488 3,630 Europe, Middle East and Africa 22 20 44 42 Asia-Pacific 11 23 22 34 $ 2,227 $ 2,437 $ 4,614 $ 4,705 Income from Operations: United States and Latin America $ 12,009 $ 6,163 $ 24,290 $ 17,716 Canada 7,520 8,700 11,058 12,776 Europe, Middle East and Africa 2,333 1,079 2,667 (1,562) Asia-Pacific 1,769 1,809 2,676 1,746 Unallocated: Stock compensation (1,450) (1,251) (2,688) (2,444) Public company costs (497) (462) (905) (980) $ 21,684 $ 16,038 $ 37,098 $ 27,252 September 30, 2023 March 31, 2023 Property, Plant and Equipment, Net: United States and Latin America $ 33,499 $ 31,918 Canada 28,398 28,369 Europe, Middle East and Africa 2,248 2,366 Asia-Pacific 649 635 $ 64,794 $ 63,288 Total Assets: United States and Latin America $ 279,738 $ 270,404 Canada 280,653 287,221 Europe, Middle East and Africa 61,074 57,680 Asia-Pacific 42,258 34,324 $ 663,723 $ 649,629 |
Schedule of Capital Expenditures by Geographic Area | Capital expenditures for our reportable segments were as follows: Three Months Ended September 30, 2023 Three Months Ended September 30, 2022 Six Months Ended Six Months Ended Capital Expenditures: United States and Latin America $ 1,719 $ 1,180 $ 3,546 $ 1,423 Canada 996 715 1,906 2,000 Europe, Middle East and Africa 4 51 37 132 Asia-Pacific 88 51 119 59 $ 2,807 $ 1,997 $ 5,608 $ 3,614 |
Basis of Presentation (Details)
Basis of Presentation (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Mar. 31, 2022 |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Cash and cash equivalents | $ 30,532 | $ 35,635 | ||
Total cash, cash equivalents, and restricted cash shown in the statements of cash flows | 32,932 | 38,520 | $ 34,545 | $ 43,931 |
Restricted cash included in 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 statements of cash flows | 2,365 | 2,859 | ||
Restricted cash included in other non-current assets | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Total cash, cash equivalents, and restricted cash shown in the statements of cash flows | $ 35 | $ 26 |
Acquisition - Narrative (Detail
Acquisition - Narrative (Details) - Powerblanket - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | 13 Months Ended | |
May 31, 2022 | Jun. 30, 2022 | Sep. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2023 | |
Business Acquisition [Line Items] | |||||
Equity interests acquired | 100% | ||||
Payments to acquire business | $ 35,000 | ||||
Increase to net working capital | $ 299 | ||||
Transaction costs | $ 278 | ||||
Acquisition and other related costs | $ 126 | $ 0 | $ 126 |
Acquisition - Purchase Price (D
Acquisition - Purchase Price (Details) - USD ($) $ in Thousands | May 31, 2022 | Sep. 30, 2023 | Mar. 31, 2023 |
Business Acquisition [Line Items] | |||
Goodwill | $ 218,864 | $ 219,612 | |
Powerblanket | |||
Business Acquisition [Line Items] | |||
Accounts receivable | $ 1,267 | ||
Inventories | 3,545 | ||
Property, plant and equipment | 391 | ||
Other current assets | 290 | ||
Other non-current assets | 954 | ||
Goodwill | 18,620 | ||
Total fair value of assets acquired | 38,234 | ||
Accounts payable | (1,098) | ||
Accrued liabilities | (637) | ||
Other liabilities | (1,200) | ||
Total fair value of liabilities acquired | (2,935) | ||
Purchase price | 35,299 | ||
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 | 6 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Business Acquisition [Line Items] | ||||
Sales | $ 123,659 | $ 100,557 | $ 230,548 | $ 197,863 |
Net income | $ 14,730 | $ 10,984 | $ 25,668 | $ 17,257 |
Fair Value Measurements - Infor
Fair Value Measurements - Information About Our Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Mar. 31, 2023 |
Financial Assets: | ||
Deferred compensation plan assets, Carrying Value | $ 7,103 | $ 6,350 |
Financial Liabilities: | ||
Deferred compensation plan liabilities, Carrying Value | 6,400 | 5,671 |
Foreign currency contract forwards liabilities, Carrying Value | 70 | 26 |
Foreign currency contract forwards assets | ||
Financial Assets: | ||
Foreign currency contract forwards assets, Carrying Value | 0 | 60 |
Outstanding borrowings from revolving line of credit | ||
Financial Liabilities: | ||
Long-term debt, Carrying Value | 27,500 | 14,500 |
Level 1 - Active Markets | ||
Financial Assets: | ||
Deferred compensation plan assets, Fair Value | 7,103 | 6,350 |
Financial Liabilities: | ||
Deferred compensation plan liabilities, Fair Value | 6,400 | 5,671 |
Level 2 - Market Approach | ||
Financial Liabilities: | ||
Foreign currency contract forwards liabilities, Fair Value | 70 | 26 |
Level 2 - Market Approach | Foreign currency contract forwards assets | ||
Financial Assets: | ||
Foreign currency contract forwards assets, Fair Value | 0 | 60 |
Level 2 - Market Approach | Outstanding borrowings from revolving line of credit | ||
Financial Liabilities: | ||
Long-term debt, Fair Value | 27,500 | 14,500 |
Loans Payable | ||
Financial Liabilities: | ||
Long-term debt, Carrying Value | 83,139 | 98,361 |
Loans Payable | Level 2 - Market Approach | ||
Financial Liabilities: | ||
Long-term debt, Fair Value | $ 82,931 | $ 98,115 |
Fair Value Measurements - Defer
Fair Value Measurements - Deferred Compensation Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |||||
Deferred compensation plan assets | $ 7,103 | $ 7,103 | $ 6,350 | ||
Deferred compensation other noncurrent liability | 6,400 | 6,400 | $ 5,671 | ||
Deferred compensation plan expense/(income) | (247) | $ (303) | 26 | $ (963) | |
Unrealized loss (gain) on investments | $ 234 | $ 296 | $ (50) | $ 934 |
Fair Value Measurements - Forei
Fair Value Measurements - Foreign Exchange Contracts by Currency (Details) - Foreign currency contract forwards assets - USD ($) $ in Thousands | Sep. 30, 2023 | Mar. 31, 2023 |
Derivative [Line Items] | ||
Total notional amounts | $ 6,000 | $ 7,000 |
Canadian Dollar | ||
Derivative [Line Items] | ||
Total notional amounts | 2,500 | 4,500 |
South Korean Won | ||
Derivative [Line Items] | ||
Total notional amounts | 2,000 | 1,500 |
Mexican Peso | ||
Derivative [Line Items] | ||
Total notional amounts | 1,500 | 0 |
Chinese Renminbi | ||
Derivative [Line Items] | ||
Total notional amounts | 0 | 500 |
Great Britain Pound | ||
Derivative [Line Items] | ||
Total notional amounts | $ 0 | $ 500 |
Fair Value Measurements - For_2
Fair Value Measurements - Foreign Exchange Contracts (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | ||||
Maximum term of forward contracts | 30 days | |||
Gain (loss) on derivatives, net | $ (148) | $ (252) | $ 28 | $ (612) |
Transaction gains (losses) denominated in foreign currencies | $ (38) | $ (37) | $ (13) | $ (333) |
Restructuring and Other Charg_2
Restructuring and Other Charges/(Income) - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 18 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | |
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and other charges/(income) | $ 304 | $ 0 | $ 885 | $ 0 | |
Russia | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and other charges/(income) | $ 304 | $ 885 | $ 13,282 |
Net Income per Common Share (De
Net Income per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Sep. 30, 2023 | Jun. 30, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Basic net income per common share | ||||||
Net income | $ 14,730 | $ 10,938 | $ 10,984 | $ 6,556 | $ 25,668 | $ 17,540 |
Weighted-average common shares outstanding (in shares) | 33,688,514 | 33,476,695 | 33,748,425 | 33,438,657 | ||
Basic net income per common share (in dollars per share) | $ 0.44 | $ 0.33 | $ 0.76 | $ 0.52 | ||
Diluted net income per common share | ||||||
Net income | $ 14,730 | $ 10,938 | $ 10,984 | $ 6,556 | $ 25,668 | $ 17,540 |
Weighted-average common shares outstanding (in shares) | 33,688,514 | 33,476,695 | 33,748,425 | 33,438,657 | ||
Weighted average shares outstanding – dilutive (in shares) | 34,126,884 | 33,773,475 | 34,093,791 | 33,611,291 | ||
Diluted net income per common share (in dollars per share) | $ 0.43 | $ 0.33 | $ 0.75 | $ 0.52 | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 0 | 36,310 | 1,633 | 113,559 | ||
Stock options | ||||||
Diluted net income per common share | ||||||
Common share equivalents (in shares) | 29,108 | 1,536 | 25,209 | 0 | ||
Restricted and performance stock units | ||||||
Diluted net income per common share | ||||||
Common share equivalents (in shares) | 409,262 | 295,244 | 320,157 | 172,634 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Mar. 31, 2023 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 59,070 | $ 53,845 |
Work in process | 5,213 | 5,338 |
Finished goods | 34,478 | 29,511 |
Inventories, gross | 98,761 | 88,694 |
Valuation reserves | (6,211) | (6,562) |
Inventories, net | $ 92,550 | $ 82,132 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Carrying Amount of Goodwill (Details) $ in Thousands | 6 Months Ended |
Sep. 30, 2023 USD ($) | |
Goodwill | |
Balance at the beginning of the period | $ 219,612 |
Foreign currency translation impact | (748) |
Balance at the end of the period | 218,864 |
United States and Latin America | |
Goodwill | |
Balance at the beginning of the period | 81,345 |
Foreign currency translation impact | 0 |
Balance at the end of the period | 81,345 |
Canada | |
Goodwill | |
Balance at the beginning of the period | 112,945 |
Foreign currency translation impact | 109 |
Balance at the end of the period | 113,054 |
Europe, Middle East and Africa | |
Goodwill | |
Balance at the beginning of the period | 18,679 |
Foreign currency translation impact | (522) |
Balance at the end of the period | 18,157 |
Asia-Pacific | |
Goodwill | |
Balance at the beginning of the period | 6,643 |
Foreign currency translation impact | (335) |
Balance at the end of the period | $ 6,308 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Mar. 31, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, accumulated amortization | $ (148,996) | $ (144,859) |
Intangible assets, gross | 237,014 | 238,829 |
Intangible Assets, Net (Excluding Goodwill) | 88,018 | 93,970 |
Certifications | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 427 | 441 |
Products | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 61,619 | 61,560 |
Finite-lived intangible assets, accumulated amortization | (36,458) | (33,344) |
Finite-lived intangible assets, net carrying amount | 25,161 | 28,216 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 46,141 | 47,427 |
Finite-lived intangible assets, accumulated amortization | (2,281) | (2,031) |
Finite-lived intangible assets, net carrying amount | 43,860 | 45,396 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 14,568 | 14,862 |
Finite-lived intangible assets, accumulated amortization | (6,726) | (6,520) |
Finite-lived intangible assets, net carrying amount | 7,842 | 8,342 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 112,979 | 113,259 |
Finite-lived intangible assets, accumulated amortization | (103,190) | (102,743) |
Finite-lived intangible assets, net carrying amount | 9,789 | 10,516 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 1,280 | 1,280 |
Finite-lived intangible assets, accumulated amortization | (341) | (221) |
Finite-lived intangible assets, net carrying amount | $ 939 | $ 1,059 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Mar. 31, 2023 |
Payables and Accruals [Abstract] | ||
Accrued employee compensation and related expenses | $ 13,012 | $ 17,709 |
Accrued interest | 72 | 414 |
Customer prepayments | 82 | 89 |
Warranty reserves | 1,053 | 758 |
Professional fees | 2,197 | 2,696 |
Sales taxes payable | 3,802 | 4,301 |
Accrued litigation payable | 4,187 | 5,880 |
Other | 6,180 | 7,517 |
Total accrued current liabilities | 30,585 | $ 39,364 |
Non-cash foreign currency translation | $ 3,384 |
Debt - Schedule of Long-Term De
Debt - Schedule of Long-Term Debt (Details) $ in Thousands | Sep. 30, 2023 USD ($) | Mar. 31, 2023 USD ($) | Sep. 29, 2021 |
Debt Instrument [Line Items] | |||
Less current portion | $ (10,226) | $ (10,222) | |
Total long-term debt | $ 72,599 | 87,710 | |
Covenant leverage ratio, maximum | 0.50 | ||
January 1, 2022 through October 1, 2022 | Line of Credit | |||
Debt Instrument [Line Items] | |||
Original Principal Amount | 1.25% | ||
January 1, 2023 through October 1, 2024 | Line of Credit | |||
Debt Instrument [Line Items] | |||
Original Principal Amount | 1.88% | ||
January 1, 2025 through July 1, 2026 | Line of Credit | |||
Debt Instrument [Line Items] | |||
Original Principal Amount | 2.50% | ||
December 31, 2022 and each fiscal quarter thereafter | |||
Debt Instrument [Line Items] | |||
Consolidated Leverage Ratio | 350% | ||
Variable Rate Term Loan due September 2026 | Loans Payable | |||
Debt Instrument [Line Items] | |||
Deferred debt issuance costs | $ 314 | 429 | |
Variable Rate Term Loan A due September 2026, net of deferred debt issuance costs of $314 and $429 as of September 30, 2023, and March 31, 2023, respectively | $ 82,825 | $ 97,932 |
Debt - Narrative (Details)
Debt - Narrative (Details) | 6 Months Ended | ||
Sep. 30, 2023 USD ($) | Sep. 29, 2021 USD ($) | Sep. 29, 2021 CAD ($) | |
Debt Instrument [Line Items] | |||
Line of credit facility, fixed charge coverage ratio | 125% | ||
Outstanding letters of credit | $ 2,401,000 | ||
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 | 27,500,000 | ||
Line of credit facility, accordian feature | $ 100,000 | ||
Capacity available under credit facility | $ 70,099,000 | ||
Variable term loan, interest rate | 6.68% | ||
Line of Credit | |||
Debt Instrument [Line Items] | |||
Long-term debt, term | 5 years | 5 years | |
Long-term line of credit | $ 76,182 | ||
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 | 6.68% | ||
U.S. Term Loan | Guarantor Subsidiaries | |||
Debt Instrument [Line Items] | |||
Capital stock first lien assets, percentage | 100% | ||
Capital stock first tier material foreign subsidiaries, percentage | 65% | ||
Canadian Term Loan Facility | |||
Debt Instrument [Line Items] | |||
Variable term loan, interest rate | 6.73% | ||
Canadian Term Loan Facility | Guarantor Subsidiaries | |||
Debt Instrument [Line Items] | |||
Capital stock first lien assets, percentage | 100% |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Totaled arrangements under letter of credit guarantees and performance bonds securing performance obligations | $ 17,948 |
Guarantee obligations secured by cash deposits | 1,284 |
Guarantee obligations represented by a reduction of the available amount of the company's short term and long term revolving lines of credit | 2,401 |
Indian custom bonds outstanding | $ 4,423 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 123,659 | $ 100,557 | $ 230,548 | $ 195,999 |
Revenues recognized at point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 72,635 | 62,331 | 137,780 | 121,117 |
Revenues recognized over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 51,024 | 38,226 | 92,768 | 74,882 |
United States and Latin America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 63,797 | 47,434 | 117,294 | 93,027 |
United States and Latin America | Revenues recognized at point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 31,744 | 24,749 | 61,635 | 47,865 |
United States and Latin America | Revenues recognized over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 32,053 | 22,685 | 55,659 | 45,162 |
Canada | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 36,149 | 34,783 | 71,472 | 66,978 |
Canada | Revenues recognized at point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 25,625 | 25,656 | 50,147 | 50,787 |
Canada | Revenues recognized over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 10,524 | 9,127 | 21,325 | 16,191 |
Europe, Middle East and Africa | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 13,407 | 9,543 | 23,088 | 19,579 |
Europe, Middle East and Africa | Revenues recognized at point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 7,819 | 5,261 | 13,212 | 11,168 |
Europe, Middle East and Africa | Revenues recognized over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 5,588 | 4,282 | 9,876 | 8,411 |
Asia-Pacific | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 10,306 | 8,797 | 18,694 | 16,415 |
Asia-Pacific | Revenues recognized at point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 7,447 | 6,665 | 12,786 | 11,297 |
Asia-Pacific | Revenues recognized over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 2,859 | $ 2,132 | $ 5,908 | $ 5,118 |
Revenue - Performance Obligatio
Revenue - Performance Obligation (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 166,869 |
Remaining performance obligation, period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 13,988 |
Remaining performance obligation, period | 1 year |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Mar. 31, 2023 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 27,259 | $ 16,272 |
Contract liabilities | $ 7,261 | $ 8,483 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate | 23.80% | 26.20% |
Discrete tax (benefit) expense | $ (197) | $ 343 |
Liability for uncertain tax positions | $ 1,001 |
Segment Information - Narrative
Segment Information - Narrative (Details) | 6 Months Ended |
Sep. 30, 2023 segment Geographic_Region | |
Segment Reporting [Abstract] | |
Number of reportable segments | segment | 4 |
Number of operating segments | Geographic_Region | 4 |
Segment Information - Schedule
Segment Information - Schedule of Total Sales and Operating Income Classified by Major Geographic Area (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Mar. 31, 2023 | |
Sales by geographic area: | |||||
Sales | $ 123,659 | $ 100,557 | $ 230,548 | $ 195,999 | |
Depreciation | 2,136 | 2,519 | 4,188 | 5,147 | |
Amortization of intangible assets | 2,227 | 2,437 | 4,614 | 4,705 | |
Operating income | |||||
Operating income (loss) | 21,684 | 16,038 | 37,098 | 27,252 | |
Property, Plant and Equipment, Net: | 64,794 | 64,794 | $ 63,288 | ||
Total Assets: | 663,723 | 663,723 | 649,629 | ||
Operating Segments | |||||
Sales by geographic area: | |||||
Sales | 123,659 | 100,557 | 230,548 | 195,999 | |
Intersegment Eliminations | |||||
Sales by geographic area: | |||||
Sales | 15,828 | 15,812 | 30,441 | 30,866 | |
Segment Reconciling Items | |||||
Operating income | |||||
Stock compensation | (1,450) | (1,251) | (2,688) | (2,444) | |
Public company costs | (497) | (462) | (905) | (980) | |
United States and Latin America | |||||
Sales by geographic area: | |||||
Depreciation | 1,108 | 1,240 | 2,164 | 2,587 | |
Amortization of intangible assets | 449 | 599 | 1,060 | 999 | |
Operating income | |||||
Operating income (loss) | 12,009 | 6,163 | 24,290 | 17,716 | |
Property, Plant and Equipment, Net: | 33,499 | 33,499 | 31,918 | ||
Total Assets: | 279,738 | 279,738 | 270,404 | ||
United States and Latin America | Operating Segments | |||||
Sales by geographic area: | |||||
Sales | 63,797 | 47,434 | 117,294 | 93,027 | |
United States and Latin America | Intersegment Eliminations | |||||
Sales by geographic area: | |||||
Sales | 11,269 | 11,841 | 19,650 | 22,742 | |
Canada | |||||
Sales by geographic area: | |||||
Depreciation | 937 | 1,148 | 1,848 | 2,300 | |
Amortization of intangible assets | 1,745 | 1,795 | 3,488 | 3,630 | |
Operating income | |||||
Operating income (loss) | 7,520 | 8,700 | 11,058 | 12,776 | |
Property, Plant and Equipment, Net: | 28,398 | 28,398 | 28,369 | ||
Total Assets: | 280,653 | 280,653 | 287,221 | ||
Canada | Operating Segments | |||||
Sales by geographic area: | |||||
Sales | 36,149 | 34,783 | 71,472 | 66,978 | |
Canada | Intersegment Eliminations | |||||
Sales by geographic area: | |||||
Sales | 3,851 | 3,304 | 8,583 | 6,656 | |
Europe, Middle East and Africa | |||||
Sales by geographic area: | |||||
Depreciation | 51 | 96 | 98 | 189 | |
Amortization of intangible assets | 22 | 20 | 44 | 42 | |
Operating income | |||||
Operating income (loss) | 2,333 | 1,079 | 2,667 | (1,562) | |
Property, Plant and Equipment, Net: | 2,248 | 2,248 | 2,366 | ||
Total Assets: | 61,074 | 61,074 | 57,680 | ||
Europe, Middle East and Africa | Operating Segments | |||||
Sales by geographic area: | |||||
Sales | 13,407 | 9,543 | 23,088 | 19,579 | |
Europe, Middle East and Africa | Intersegment Eliminations | |||||
Sales by geographic area: | |||||
Sales | 286 | 234 | 675 | 656 | |
Asia-Pacific | |||||
Sales by geographic area: | |||||
Depreciation | 40 | 35 | 78 | 71 | |
Amortization of intangible assets | 11 | 23 | 22 | 34 | |
Operating income | |||||
Operating income (loss) | 1,769 | 1,809 | 2,676 | 1,746 | |
Property, Plant and Equipment, Net: | 649 | 649 | 635 | ||
Total Assets: | 42,258 | 42,258 | $ 34,324 | ||
Asia-Pacific | Operating Segments | |||||
Sales by geographic area: | |||||
Sales | 10,306 | 8,797 | 18,694 | 16,415 | |
Asia-Pacific | Intersegment Eliminations | |||||
Sales by geographic area: | |||||
Sales | $ 422 | $ 433 | $ 1,533 | $ 812 |
Segment Information - Capital E
Segment Information - Capital Expenditures (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Segment Reporting Information [Line Items] | ||||
Capital expenditures | $ 2,807 | $ 1,997 | $ 5,608 | $ 3,614 |
United States and Latin America | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | 1,719 | 1,180 | 3,546 | 1,423 |
Canada | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | 996 | 715 | 1,906 | 2,000 |
Europe, Middle East and Africa | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | 4 | 51 | 37 | 132 |
Asia-Pacific | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | $ 88 | $ 51 | $ 119 | $ 59 |
Uncategorized Items - thr-20230
Label | Element | Value |
Repayments of Secured Debt | us-gaap_RepaymentsOfSecuredDebt | $ 10,441,000 |