Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2015shares | |
Document and Entity Information [Abstract] | |
Document Type | 20-F |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2015 |
Entity Registrant Name | CaesarStone Sdot-Yam Ltd. |
Entity Central Index Key | 1,504,379 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2,015 |
Document Fiscal Period Focus | FY |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 35,294,755 |
Entity Well-known Seasoned Issuer | Yes |
Entity Current Reporting Status | Yes |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | |
Current assets: | |||
Cash and cash equivalents | $ 62,747 | $ 42,280 | |
Short-term bank deposits | 60 | 12,047 | |
Trade receivables (net of allowance for doubtful accounts of $1,221 and $2,225 at December 31, 2015 and 2014, respectively) | 59,185 | 56,217 | |
Other accounts receivable and prepaid expenses | 32,230 | 22,729 | |
Inventories | 95,479 | 80,212 | |
Total current assets | 249,701 | 213,485 | |
Long-term assets: | |||
Severance pay fund | 3,296 | $ 3,744 | |
Other long-term receivables | 6,616 | ||
Long-term deposits and prepaid expenses | 1,987 | $ 759 | |
Property, plant and equipment, net | 225,438 | 172,993 | |
Other intangibles assets | 6,883 | 10,059 | |
Goodwill | 35,821 | 37,960 | |
Total assets | 529,742 | $ 439,000 | |
Current liabilities: | |||
Short-term bank credit | 3,241 | ||
Trade payables | 46,382 | $ 59,430 | |
Related party and other loan | [1] | 3,251 | 3,975 |
Accrued expenses and other liabilities | 27,986 | 25,774 | |
Total current liabilities | 80,860 | 89,179 | |
Long-term liabilities: | |||
Long-term loan and financing leaseback from a related party | [2] | 8,472 | 8,993 |
Accrued severance pay | 4,309 | 4,217 | |
Long-term warranty provision | 934 | 1,145 | |
Phantom share based payment | 148 | $ 805 | |
Legal settlements and loss contingencies long term | 11,190 | ||
Deferred tax liabilities, net | 14,767 | $ 4,935 | |
Total long-term liabilities | 39,820 | 20,095 | |
Redeemable non-controlling interest | $ 8,841 | $ 8,715 | |
Commitments and contingent liabilities | |||
Share capital- | |||
Ordinary shares of NIS 0.04 par value - 200,000,000 shares authorized at December 31, 2015 and 2014; 35,294,755 and 35,132,127 shares issued and outstanding at December 31, 2015 and 2014, respectively | $ 370 | $ 369 | |
Additional paid-in capital | 142,765 | 139,964 | |
Accumulated other comprehensive loss, net | (1,892) | (534) | |
Retained earnings | 258,978 | 181,212 | |
Total equity | 400,221 | 321,011 | |
Total liabilities and equity | $ 529,742 | $ 439,000 | |
[1] | On January 17, 2011 a loan of 4 million Canadian dollars was made to Caesarstone Canada Inc. by its shareholders, CIOT and the Company, on a pro rata basis. The loan bears interest until repayment at a per annum rate equal to Bank of Canada's prime business rate plus 0.25%. The interest accrued on the loan is payable on a quarterly basis. As of December 31, 2015 the loan was classified to short term related party and other loan balance. | ||
[2] | In September, 2012, a financing leaseback of $10.9 million related to Bar-Lev transaction was granted to the Company by Kibbutz Sdot-Yam. The financing leaseback bears interest until repayment at a per annum rate equal to 6.19% and is subject to adjustment for increases in the Israeli consumer price index. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) $ in Thousands | Dec. 31, 2015USD ($)shares | Dec. 31, 2014USD ($)shares |
CONSOLIDATED BALANCE SHEETS [Abstract] | ||
Trade receivables, allowance for doubtful accounts | $ | $ 1,221 | $ 2,225 |
Ordinary shares, shares authorized | 200,000,000 | 200,000,000 |
Ordinary shares, shares issued | 35,294,755 | 35,132,127 |
Ordinary shares, shares outstanding | 35,294,755 | 35,132,127 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
CONSOLIDATED STATEMENTS OF INCOME [Abstract] | |||
Revenues | $ 499,515 | $ 447,402 | $ 356,554 |
Cost of revenues | 299,290 | 257,751 | 194,436 |
Gross profit | 200,225 | 189,651 | 162,118 |
Operating expenses: | |||
Research and development | 3,052 | 2,628 | 2,002 |
Marketing and selling | 59,521 | 55,870 | 51,209 |
General and administrative | 36,612 | $ 36,111 | $ 32,904 |
Legal settlements and loss contingencies, net | 4,654 | ||
Total operating expenses | 103,839 | $ 94,609 | $ 86,115 |
Operating income | 96,386 | 95,042 | 76,003 |
Finance expenses, net | 3,085 | 1,045 | 1,314 |
Income before taxes on income | 93,301 | 93,997 | 74,689 |
Taxes on income | 13,843 | 13,738 | 10,336 |
Net income | 79,458 | 80,259 | 64,353 |
Net income attributable to non-controlling interest | 1,692 | 1,820 | 1,009 |
Net income attributable to controlling interest | $ 77,766 | $ 78,439 | $ 63,344 |
Basic net income per share of ordinary shares | $ 2.21 | $ 2.25 | $ 1.83 |
Diluted net income per share of ordinary shares | $ 2.19 | $ 2.22 | $ 1.80 |
Weighted average number of ordinary shares used in computing basic income per share | 35,252,596 | 34,932,000 | 34,666,514 |
Weighted average number of ordinary shares used in computing diluted income per share | 35,463,698 | 35,394,499 | 35,209,946 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract] | |||
Net income | $ 79,458 | $ 80,259 | $ 64,353 |
Other comprehensive loss before tax: | |||
Foreign currency translation adjustments | (5,023) | (4,227) | $ (6,182) |
Unrealized income (loss) on foreign currency cash flow hedge | 1,590 | (1,562) | |
Income tax benefit related to components of other comprehensive income | 509 | 846 | $ 855 |
Total other comprehensive loss, net of tax | (2,924) | (4,943) | (5,327) |
Comprehensive income | 76,534 | 75,316 | 59,026 |
Less: comprehensive income attributable to non-controlling interest | (126) | (1,091) | (519) |
Comprehensive income attributable to controlling interest | $ 76,408 | $ 74,225 | $ 58,507 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss), Net [Member] | [1] | |
Balance at Dec. 31, 2012 | $ 223,917 | $ 360 | $ 135,437 | $ 79,603 | $ 8,517 | ||
Balance, shares at Dec. 31, 2012 | 34,365,250 | ||||||
Other comprehensive loss | (4,837) | $ (4,837) | |||||
Net income | 63,344 | $ 63,344 | |||||
Equity-based compensation expense related to employees | $ 2,514 | $ 2,514 | |||||
Cashless exercise of options | $ 4 | $ (4) | |||||
Cashless exercise of options, shares | 374,065 | ||||||
Dividend | $ (20,149) | $ (20,149) | |||||
Compensation paid by a former shareholder | [2] | 810 | $ 810 | ||||
Balance at Dec. 31, 2013 | 265,599 | $ 364 | $ 138,757 | $ 122,798 | $ 3,680 | ||
Balance, shares at Dec. 31, 2013 | 34,739,315 | ||||||
Other comprehensive loss | (4,214) | $ (4,214) | |||||
Net income | 78,439 | $ 78,439 | |||||
Equity-based compensation expense related to employees | $ 1,212 | $ 1,212 | |||||
Cashless exercise of options | $ 5 | $ (5) | |||||
Cashless exercise of options, shares | 392,812 | ||||||
Dividend | $ (20,025) | $ (20,025) | |||||
Balance at Dec. 31, 2014 | 321,011 | $ 369 | $ 139,964 | $ 181,212 | $ (534) | ||
Balance, shares at Dec. 31, 2014 | 35,132,127 | ||||||
Other comprehensive loss | (1,358) | $ (1,358) | |||||
Net income | 77,766 | $ 77,766 | |||||
Equity-based compensation expense related to employees | [3] | $ 2,802 | $ 2,802 | ||||
Cashless exercise of options | $ 1 | (1) | |||||
Cashless exercise of options, shares | 162,628 | ||||||
Balance at Dec. 31, 2015 | $ 400,221 | $ 370 | $ 142,765 | $ 258,978 | $ (1,892) | ||
Balance, shares at Dec. 31, 2015 | 35,294,755 | ||||||
[1] | Accumulated other comprehensive income (loss), net, comprised of foreign currency translation and hedging transactions. | ||||||
[2] | A bonus paid by the Company's former shareholder, to certain of its employees. | ||||||
[3] | See also note 12 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | |||
Net income | $ 79,458 | $ 80,259 | $ 64,353 |
Adjustments required to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 22,334 | 17,176 | 14,994 |
Share-based compensation expense | 2,293 | 2,642 | 2,514 |
Accrued severance pay, net | 540 | (26) | (64) |
Changes in deferred tax, net | $ 7,051 | $ (2,580) | 674 |
Capital gains | (22) | ||
Compensation paid by a former shareholder | 810 | ||
Foreign currency translation gains | (132) | ||
Increase in trade receivables | $ (2,968) | $ (3,913) | (8,238) |
Decrease (increase) in other accounts receivable and prepaid expenses | (3,069) | 1,393 | (7,419) |
Increase in inventories | (15,267) | (22,345) | (7,317) |
Increase (decrease) in trade payables | (8,659) | 1,811 | 9,351 |
Increase (decrease) in warranty provision | (447) | $ (4) | $ 401 |
Increase in legal settlements and loss contingencies, net | 4,654 | ||
Increase (decrease) in accrued expenses and other liabilities including related party | (259) | $ 1,611 | $ 5,765 |
Net cash provided by operating activities | 85,661 | 76,024 | 75,670 |
Cash flows from investing activities: | |||
Redemption of (investment in) short-term deposits | $ 11,987 | 57,953 | $ (26,300) |
Acquisition of the business of Prema Asia Marketing PTE Ltd. (see also Note 1(b)) | (150) | ||
Purchase of property, plant and equipment | $ (76,495) | (86,373) | $ (27,372) |
Decrease (increase) in long-term deposits | (1,228) | 844 | (405) |
Net cash used in investing activities | $ (65,736) | (27,726) | (54,077) |
Cash flows from financing activities: | |||
Dividends paid | $ (20,025) | (20,149) | |
Repayment of long-term loans | (5,372) | ||
Short-term bank credit and loans, net | $ 3,241 | $ (5,454) | 206 |
Repayment of a financing leaseback | (1,092) | (1,192) | (1,149) |
Net cash provided by (used in) financing activities | 2,149 | (26,671) | (26,464) |
Effect of exchange rate differences on cash and cash equivalents | (1,607) | (1,595) | (1,914) |
Increase (decrease) in cash and cash equivalents | 20,467 | 20,032 | (6,785) |
Cash and cash equivalents at beginning of year | 42,280 | 22,248 | 29,033 |
Cash and cash equivalents at end of year | 62,747 | 42,280 | 22,248 |
Cash received (paid) during the year for: | |||
Interest paid | (180) | (141) | (946) |
Interest received | 45 | 46 | 420 |
Tax paid | (16,372) | (16,744) | (9,434) |
Non cash activity during the year for: | |||
Changes in trade payables balances related to purchase of property, plant and equipment | $ (4,389) | $ 6,992 | $ 4,880 |
GENERAL
GENERAL | 12 Months Ended |
Dec. 31, 2015 | |
GENERAL [Abstract] | |
GENERAL | NOTE 1:- GENERAL a. General: Caesarstone Sdot-Yam Ltd., incorporated under the laws of the State of Israel, was founded in 1987. The company and its subsidiaries (collectively, the "Company" or "Caesarstone") manufacture high quality engineered quartz surfaces sold under the Company's premium Caesarstone brand. The Company's products consist of engineered quartz slabs that are currently sold in over 50 and in the new buildings construction market The Company has subsidiaries in Australia, Singapore, Canada and the United States United States and b. Acquisition of the business of Prema Asia Marketing PTE Ltd. ("Prema"): The Company entered into an agreement on October 1, 2011 pursuant to which it acquired the operations for the distribution of Caesarstone's products in Singapore from the Company's former distributor in Singapore. Under the terms of the agreement, the Company paid approximately $ 500 300 150 150 c. Major suppliers: In 2015, the Company acquired approximately 71 41 29 36 Maden Sanayi ve Ticaret A.Ş. (Polat) constituting approximately 25 of Company's total quartz . |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2015 | |
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). a. Use of estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. The Company's management believes that the estimates, judgment and assumptions used are reasonable based upon information available at the time they were made. b. Financial statements in U.S. dollars: The Company's revenues are generated in U.S. dollars (USD), Australian dollars, Canadian dollars, Euros and New Israeli Shekels (NIS). In addition, most of the Company's costs are incurred in USD, NIS, Euros, Australian dollars, Canadian dollars and Singapore dollars. The Company's management believes that the USD is the primary currency of the economic environment in which the Company operates. Thus, the functional and reporting currency of the Company is the USD. The functional currency of the majority of the Company's foreign subsidiaries is the local currency in which it operates. Accordingly, monetary accounts maintained in currencies other than the are re-measured into dollars in accordance with Accounting Standards Codification ("ASC") 830, "Foreign Currency Matters". All transaction gains and losses resulting from the re-measurement of monetary balance sheet items denominated in non-USD currencies are reflected in the statements of operations as financial income or expenses as appropriate. The financial statements of the Company's subsidiaries of which the functional currency is not the USD have been translated into dollars. All amounts on the balance sheets have been translated into the USD using the exchange rates in effect on the relevant balance sheet dates. All amounts in the statements of operations have been translated into the USD using the exchange rate on the respective dates on which those elements are recognized. The resulting translation adjustments are reported as a component of accumulated other comprehensive income in shareholders' equity. c. Principles of consolidation: The consolidated financial statements include the accounts of the Company and its wholly and majority-owned subsidiaries. Inter-company transactions and balances, including profit from inter-company sales not yet realized outside of the Company, have been eliminated upon consolidation. d. Cash equivalents: Cash equivalents are short-term highly liquid investments that are readily convertible to cash with original maturities of three months or less at the date acquired. e. Short-term bank deposits: Short-term bank deposits are deposits with original maturities of more than three months but less than one year. Short-term bank deposits are presented at their cost, which approximates their fair value. f. Derivatives: ASC 815, Derivative and Hedging, requires companies to recognize all of their derivative instruments as either assets or liabilities in the statement of financial position at fair value. For those derivative instruments that are designated and qualify as hedging instruments, a company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, cash flow hedge or a hedge of a net investment in a foreign operation. Derivative instruments designated as hedging instruments For derivative instruments that are designated and qualify as a cash flow hedge (i.e., hedging the exposure to variability in expected future cash flows that is attributable to a particular risk), the effective portion of the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same period during which the hedged transaction affects earnings. The remaining gain or loss on the derivative instrument in excess of the cumulative change in the present value of future cash flows of the hedged item, if any, is recognized in current earnings during the period of change. For derivative instruments not designated as hedging instruments, the gain or loss is recognized in current earnings during the period of change. To hedge against the risk of overall changes in cash flows resulting from foreign currency salary payments during the periods, the Company has instituted a foreign currency cash flow hedging program. The Company hedges portions of its forecasted salary expenses denominated in NIS. These forward contracts are designated as cash flow hedges, as defined by ASC 815, and are all effective, as their critical terms match the underlying transactions being hedged. As of December 31, 2015 and 2014, the unrealized gain (loss) recorded in accumulated other comprehensive income from the Company's currency forward NIS transactions were $ 20 ($1,334) At December 31, 2015 and 2014, the notional amounts of foreign exchange forward contracts which the Company entered into were $ 749 12,925 respectively Derivative instruments not designated as hedging instruments In addition to the derivatives that are designated as hedges as discussed above, the Company enters into certain foreign exchange forward and options contracts to limit its exposure to foreign currencies. Gains and losses related to such derivative instruments are recorded in financial expenses, net. At December 31, 2015 and 2014, the notional amount of foreign exchange forward and option contracts into which the Company entered was $ 186,217 86,639 The following tables present fair value amounts of, and gains and losses recorded in relation to, the Company's derivative instruments and related hedged items: Balance Sheet Fair Value of Derivative Instruments Year ended December 31, 2015 2014 Derivative Assets: Derivatives not designated as hedging instruments: Foreign exchange option and forward contracts Other accounts receivable and prepaid expenses $ 2,040 $ 2,479 Derivatives designated as hedging instruments: Foreign exchange forward contracts Other accounts receivable and prepaid expenses $ 20 $ - Total $ 2,060 $ 2,479 Derivative Liabilities Derivatives not designated as hedging instruments: Foreign exchange option and forward contracts Other accounts payable and accrued expenses $ (1,421 ) (1,453 ) Derivatives designated as hedging instruments: Foreign exchange forward contracts Other accounts payable and accrued expenses $ - $ (1,447 ) Total $ (1,421 ) $ (2,900 ) Gain (loss) Recognized in Other Comprehensive Income, net Gain (loss) Recognized in Statements of Operations Year ended December 31, Statements of Year ended December 31, 2015 2014 Item 2015 2014 Derivatives designated as hedging instruments Foreign exchange forward contract $ 20 $ (1,334 ) Operating expenses $ (1,364 ) $ (834 ) Derivatives not designated as hedging instruments: Foreign exchange forward and options contracts - - Financial expenses, net 3,242 (153 ) Total $ 20 $ (1,334 ) $ 1,878 $ (987 ) g. Inventories: Inventories are stated at the lower of cost or market value. The Company periodically evaluates the quantities on hand relative to historical and projected sales volumes, current and historical selling prices and contractual obligations to maintain certain levels of parts. Based on these evaluations, inventory write-offs are provided to cover risks arising from slow-moving items, discontinued products, excess inventories, market prices lower than cost and adjusted revenue forecasts. Cost is determined as follows: Raw Materials - Cost is determined on a standard cost basis which approximates actual costs on a weighted average basis. Work-in-progress and finished products - are based on standard cost (which approximates actual cost on a weighted average basis) which includes raw materials cost, labor and manufacturing overhead. Finished goods are stated at the lower of cost or market. The following table provides the details of the change in the Company's provision for inventory: December 31, 2015 2014 Inventory provision, beginning of year $ 7,724 $ 6,268 Increase in inventory provision 1,708 1,707 Write off (447 ) (251 ) Inventory provision, end of year $ 8,985 $ 7,724 h. Property, plant and equipment, net: 1. Property, plant and equipment are stated at cost, net of accumulated depreciation and investment grants. 2. Costs recorded prior to a production line completion are reflected as construction in progress, which are recorded to land, building and machinery assets at the date of purchase. Construction in progress includes direct expenditures for the construction of the production line and is stated at cost. Capitalized costs include costs incurred under the construction contract: advisory, consulting and direct internal costs (including labor) and operating costs incurred during the construction and installation phase. 3. Depreciation is calculated by the straight-line method over the estimated useful life of the assets at the following annual rates: % Machinery and manufacturing equipment 4 33 Office equipment and furniture 7 33 Motor vehicles 10 30 Buildings 4 5 Leasehold improvments Over the shorter of the term of the lease or the life of the asset The Company has accounted for its assets that are under a capital lease arrangement in accordance with Accounting Standard Codification 840 "Leases" ("ASC 840"). Accordingly, assets under a capital lease are stated as assets of the Company on the basis of ordinary purchase prices (without the financing component), and depreciated according to the shorter of the lease term and the usual depreciation rates applicable to such assets. Lease payments payable in forthcoming years, net of the interest component included in them, are included in liabilities. The interest in respect of such amounts is accrued on a current basis and is charged to earnings. i. Impairment of long-lived assets: The Company's long-lived assets, tangible and finite-lived intangible assets (other than goodwill), are reviewed for impairment in accordance with Accounting Standard Codification 360 "Property, Plant and Equipment" ("ASC 360") whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. No impairment losses were identified during any period presented. j. Goodwill and other intangibles assets: Goodwill represents the excess of the cost of businesses acquired over the fair value of the net assets acquired in the acquisition. Under Accounting Standard Codification 350, "Intangibles-Goodwill and Other" ("ASC 350") goodwill is not amortized but instead is tested for impairment at least annually (or more frequently if impairment indicators arise). In the evaluation of goodwill for impairment, the Company has the option to perform a qualitative assessment to determine whether further impairment testing is necessary or to perform a quantitative assessment by comparing the fair value of a reporting unit to its carrying amount, including goodwill. Under the qualitative assessment, an entity is not required to calculate the fair value of a reporting unit unless the entity determines that it is more likely than not that its fair value is less than its carrying amount. If under the quantitative assessment the fair value of a reporting unit is less than its carrying amount, then the amount of the impairment loss, if any, must be measured under step two of the impairment analysis. In the first phase of impairment testing, goodwill attributable to the reporting units is tested for impairment by comparing the fair value of each reporting unit with its carrying value. If the carrying value of the reporting unit exceeds its fair value, the second phase is then performed. The Company performs an annual goodwill impairment test during the fourth quarter of each fiscal year, or more frequently, if impairment indicators are present. The Company Goodwill was tested for impairment by comparing its fair value with its carrying value. As required by ASC 820, "Fair Value Measurements", the Company applies assumptions that market place participants would consider in determining the fair value of reporting unit. No impairment of goodwill was identified during any period presented. Acquired intangible assets other than goodwill are amortized over their weighted average amortization period unless they are determined to be indefinite. Acquired intangible assets are carried at cost, less accumulated amortization. For intangible assets purchased in a business combination, the estimated fair values of the assets received are used to establish the carrying value. The fair value of acquired intangible assets is determined using common techniques, and the Company employs assumptions developed using the perspective of a market participant. k. Warranty : The Company generally provides a standard warranty of between three ten The following table provides the details of the change in the Company's warranty accrual: 2015 2014 January 1, $ 2,620 $ 2,624 Charged to costs and expenses relating to new sales 1,091 1,154 Costs of product warranty claims (1,195 ) (989 ) Foreign currency translation adjustments (343 ) (169 ) December 31, $ 2,173 $ 2,620 l. Revenue recognition: The Company derives its revenues from sales of quartz surfaces mostly through a combination of direct sales in certain markets and indirectly through a network of distributors in other markets. Revenues are recognized in accordance with ASC 605, "Revenue Recognition" when delivery has occurred, persuasive evidence of an agreement exists, the fee is fixed and determinable, collectability is probable and no further obligations exist. All of the Company's products that are sold through agreements with exclusive distributors are non-exchangeable, non-refundable, non-returnable and without any rights of price protection or stock rotation. Accordingly, the Company considers all the distributors to be end-consumers. m. Research and development costs: Research and development costs are charged to the statement of income as incurred. n. Income taxes: The Company and its subsidiaries account for income taxes in accordance with ASC 740, "Income Taxes". This statement prescribes the use of the liability method whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Deferred tax liabilities and assets are classified as current or noncurrent based on the classification of the related asset or liability for financial reporting purposes, or according to the expected reversal dates of the specific temporary differences if not related to an asset or liability for financial reporting. The Company accounts for its uncertain tax positions in accordance with ASC 740-10. ASC 740-10 contains a two-step approach to recognizing and measuring uncertain tax positions accounted for in accordance with ASC 740. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company accrues interest and penalties related to unrecognized tax benefits in its tax expenses. o. Advertising expenses: Advertising costs are expensed as incurred. Advertising expenses for the years ended December 31, 2015, 2014 and 2013 were $ 22,380 18,557 16,589 p. Concentrations of credit risk: Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents, short-term bank deposits and trade receivables. The Company's cash and cash equivalents are invested primarily in U.S. dollars, mainly with major banks in Israel. The Company's trade receivables are derived from sales to customers located mainly in the United States, Australia, Canada, Europe and Israel. The Company performs ongoing credit evaluations of its customers and to date has not experienced any substantial losses. In certain circumstances, the Company requires letters of credit or prepayments. An allowance for doubtful accounts is provided with respect to specific receivables that the Company has determined to be doubtful of collection. For those receivables not specifically reviewed, provisions are recorded at a specific rate, based upon the age of the receivable, the collection history, current economic trends and management estimates. December 31, 2015, 2014 and 2013 The following table provides the detail of the change in the Company's provision for doubtful debts: 2015 2014 January 1, $ 2,225 $ 1,898 Charges to expenses (340 ) 974 Write offs (524 ) (544 ) Foreign currency translation adjustments (140 ) (103 ) December 31, $ 1,221 $ 2,225 q. Severance pay: The Company's liability for severance pay, with respect to its Israeli employees, is calculated pursuant to Israeli severance pay law and employee agreements based on the most recent salary of the employees. The Company's liability for all of its Israeli employees is provided for by monthly deposits with insurance policies and by an accrual. The value of these policies is recorded as an asset on the Company's balance sheet. The deposited funds include profits or losses accumulated up to the balance sheet date. The deposited funds may be withdrawn only upon the fulfillment of the obligations pursuant to Israeli severance pay law or labor agreements. Some agreements with employees specifically state, in accordance with section 14 of the Severance Pay Law, 1963, that the Company's contributions for severance pay shall be instead of severance compensation and that upon release of the policy to the employee, no additional calculations shall be conducted between the parties regarding the matter of severance pay and no additional payments shall be made by the Company to the employee. Further, since the Company has signed agreements with its employees under section 14, the related obligation and amounts deposited on behalf of such obligation are not stated on the balance sheet, as they are legally released from obligation to employees once the deposit amounts have been paid. Severance pay expenses for the years ended December 31, 2015, 2014 and 2013 amounted to approximately $ 499 455 456 r. Fair value of financial instruments: Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the "exit price") in an orderly transaction between market participants at the measurement date. In determining fair value, the Company uses various valuation approaches. ASC 820 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the inputs as follows: Level 1- Quoted prices in active markets for identical assets or liabilities. Level 2- Valuations based on one or more quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Level 3- Valuations based on inputs that are unobservable and significant to the overall fair value measurement. Foreign currency derivative contracts are classified within Level 2 as the valuation inputs are based on quoted prices and market observable data of similar instruments. The following table presents the Company's assets and (liabilities) measured at fair value on a recurring basis at December 31, 2015 and 2014: December 31, 2015 Level 1 Level 2 Level 3 Total Derivatives: Foreign currencies derivative assets $ - $ 2,060 $ - $ 2,060 Foreign currencies derivative liabilities $ - $ (1,421 ) $ - $ (1,421 ) Total $ - $ 639 $ - $ 639 December 31, 2014 Level 1 Level 2 Level 3 Total Derivatives: Foreign currencies derivative assets $ - $ 2,479 $ - $ 2,479 Foreign currencies derivative liabilities $ - $ (2,900 ) $ - $ (2,900 ) Total $ - $ (421 ) $ - $ (421 ) The carrying amounts of financial instruments not measured at fair value, including cash and cash equivalents, short-term bank deposits, trade receivables, trade payables and short term loans, approximate their fair value due to the short-term maturities of such instruments. The carrying amount of long-term loans approximates their fair value. s. Basic and diluted net income per share: Basic net income per share ("Basic EPS") is computed by dividing net income attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted net income per share ("Diluted EPS") gives effect to all dilutive potential ordinary shares outstanding during the period. The computation of Diluted EPS does not assume conversion, exercise or contingent exercise of securities that would have an anti-dilutive effect on earnings. The dilutive effect of outstanding stock options is computed using the treasury stock method. For the year ended December 31, 2015 there were 786,900 outstanding stock options that were excluded from the computation of Diluted EPS, that would have had an anti dilutive effect if included. For the years ended December 31, 2014 and 2013 no outstanding options were excluded from the computation of Diluted EPS. t. Comprehensive income and accumulated other comprehensive income: Comprehensive income consists of two components, net income and other comprehensice income ("OCI"). OCI refers to revenue, expenses, and gains and losses that under U.S. December 31, 2015 2014 Accumulated losses on derivative instruments $ 20 $ (1,334 ) Accumulated foreign currency translation differences (1,912 ) 800 Total accumulated other comprehensive income, net $ (1,892 ) $ (534 ) The following table summarizes the changes in AOCI, net of taxes for the year ended: Unrealized Accumulated Total Balance at December 31, 2013 $ - $ 3,680 $ 3,680 Other comprehensive income (loss) before reclassifications (2,168 ) (2,880 ) (5,048 ) Amounts reclassified from AOCI 834 - 834 Net current period OCI (1,334 ) (2,880 ) (4,214 ) Balance at December 31, 2014 $ (1,334 ) $ 800 $ (534 ) Other comprehensive income (loss) before reclassifications (10 ) (2,712 ) (2,722 ) Amounts reclassified from AOCI 1,364 - 1,364 Net current period OCI 1,354 (2,712 ) (1,358 ) Balance at December 31, 2015 $ 20 $ (1,912 ) $ (1,892 ) The following table shows the amounts reclassified from AOCI into the Consolidated Statements of Operations, and the associated financial statement line item, for 2015 and 2014: Affected line item in the consolidated statement of income 2015 2014 Cost of revenues $ 1,105 $ 692 Research and development 27 17 Marketing and selling 109 67 General and administrative 123 58 $ 1,364 $ 834 u. Accounting for stock-based compensation: 1. The Company accounts for stock-based compensation in accordance with ASC 718, "Compensation-Stock Compensation" ("ASC 718"). ASC 718 requires companies to estimate the fair value of equity-based payment awards on the date of grant using an option-pricing model. The Company accounts for employees' share-based payment awards classified as equity awards using the grant-date fair value method. The fair value of share-based payment transactions is recognized as an expense over the requisite service period, net of estimated forfeitures. The Company estimates forfeitures based on historical experience and anticipated future conditions. The Company elected to recognize compensation expense for an award that has a graded vesting schedule using the accelerated method. The exercise price of each option is generally the fair market value on the date of the grant. Options generally become exercisable over approximately three four 7 four In 2015, the Company estimated the fair value of stock options granted using the Black-Scholes option pricing model with the following 2015 Dividend yield 0 % Expected volatility 41.1 % Risk-free interest rate 1.2 % Expected life (in years) 3.98 The Company used volatility data of comparable companies with similar characteristics to the Company for calculating volatility in accordance with ASC 718. The computation of historical volatility was derived from the comparable companies' historical volatility for similar contractual terms. The computation of risk free interest rate is based on the rate available on the date of grant of a zero-coupon U.S. government bond with a remaining term equal to the expected term of the option. The expected term of options granted is calculated using the simplified method (being the average between the vesting periods and the contractual life of the options). The Company currently uses the simplified method as adequate historical experience is not available to provide a reasonable estimate. The dividend yield is zero, due to a dividend adjustment mechanism with respect to the exercise price upon payment of a dividend. 2. Phantom share based payment: During 2014, the Company granted several of its employees a right to a bonus payment based on an increase in the Company's share value (the "phantom award") under which the employees are entitled to receive in cash or shares the difference between exercise price, subject to adjustments for dividend distributions made until the actual payment of the bonus and the value of the Company's ordinary shares with such bonus right vesting over a four According to ASC 718-10, instruments that are required to be cash-settled (e.g., cash-settled stock appreciation rights) or require cash settlement on the occurrence of a contingent event that is considered probable should be treated as a liability. As such, in this case the share-based compensation is accounted for as a liability award. According to ASC 718-10, in connection with the measurement of the liability settlement, the value of the award should be measured each reporting date until settlement. The fair value of the phantom award was calculated using the Binominal option pricing model. On October 27, 2015, the Company's board of directors approved the grant of stock options and RSUs as a partial replacement for the phantom awards previously granted during 2014. A change in the terms or conditions of the phantom awards is accounted for as a modification under ASC 718. On the date of modification, the amounts previously recorded as a share-based compensation liability are reclassified and recorded as a component of equity by a credit to additional paid-in capital. The Company reclassified $ 195 The Company estimated the fair value of the remaining phantom awards, using the binominal option pricing model with the following weighted average assumptions: December 31, 2015 2014 Dividend yield 0 % 0 % Expected volatility 39.2 % 45.0 % Risk-free interest rate 1.8 % 1.9 % Expected life (in years) 5.2 6.3 As of December 31, 2015 and 2014, the Phantom liability balance was $ 538 1,555 52 v. Redeemable non-controlling interest: The Company is party to a put and call arrangement with respect to the remaining 45 The following table provides a reconciliation of the redeemable non-controlling interest: December 31, 2015 2014 2013 Beginning of the year $ 8,715 $ 7,624 $ 7,106 Net income attributable to non-controlling interest 1,692 1,820 1,009 Foreign currency translation adjustments (1,566 ) (729 ) (491 ) Redeemable non-controlling interest - end of the year $ 8,841 $ 8,715 $ 7,624 w. Capitalized software costs: The Company follows the accounting guidance specified in ASC 350-40, Internal-Use Software. The Company capitalizes costs incurred in the acquisition or development of software for internal use, including the costs of the software, materials, and consultants incurred in developing internal-use computer software, once final selection of the software is made. Costs incurred prior to the final selection of software and costs not qualifying for capitalization are charged to expense. Capitalized software costs are amortized on a straight-line basis over it's useful life. x. Contingencies: The Company is involved in various product liability, commercial, government investigations, environmental claims and other legal proceedings that arise from time to time in the course of business. The Company records accruals for these types of contingencies to the extent that the Company concludes their occurrence is probable and that the related liabilities are estimable. When accruing these costs, the Company will recognize an accrual in the amount within a range of loss that is the best estimate within the range. When no amount within the range is a better estimate than any other amount, the Company accrues for the minimum amount within the range. The Company records anticipated recoveries under existing insurance contracts that are probable of occurring at the amount that is expected to be collected. Legal costs are expensed as incurred. y. Impact of recently issued accounting standards 1. In May 2014, the FASB issued ASU No. 2014-09 related to revenue recognition. This new standard will replace all current GAAP guidance on this topic and eliminate all industry-specific guidance. The new revenue recognition guidance provides a unified model to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. This guidance can be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. In 2015, the FASB issued guidance to defer the effective date to fiscal years beginning after December 15, 2017 with early adoption for fiscal years beginning December 15, 2016. The Company is evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. 2. In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330), Simplifying the Measurement of Inventory. Under this ASU, the measurement principle for inventory will change from lower of cost or market value to lower of cost and net realizable value. The ASU defines net realizable value as the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The ASU is applicable to inventory that is accounted for under the first-in, first-out method and is effective for reporting periods after December 15, 2016, with early adoption permitted. The Company is evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. 3. In November 2015, the FASB issued ASU No. 2015-17 4. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) that will supersede current guidance related to accounting for leases. The guidance is intended to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The standard will be effective for the first interim period within annual periods beginning after December 15, 2018, with early adoption permitted. The standard is required to be adopted using the modified retrospective approach. The |
OTHER ACCOUNTS RECEIVABLE AND P
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES | 12 Months Ended |
Dec. 31, 2015 | |
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES [Abstract] | |
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES | NOTE 3:- OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES December 31, 2015 2014 Prepaid expenses $ 1,760 $ 2,296 Government authorities 10,459 5,765 Deferred tax assets 11,249 8,384 Advances to suppliers 2,976 2,480 Derivatives 2,060 2,479 Other receivables (see also note 10) 3,726 1,325 $ 32,230 $ 22,729 |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2015 | |
INVENTORIES [Abstract] | |
INVENTORIES | NOTE 4:- INVENTORIES December 31, 2015 2014 Raw materials $ 24,218 $ 15,439 Work-in-progress 1,422 726 Finished goods 69,839 64,047 $ 95,479 $ 80,212 |
PROPERTY, PLANT AND EQUIPMENT,
PROPERTY, PLANT AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2015 | |
PROPERTY, PLANT AND EQUIPMENT, NET [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT, NET | NOTE 5:- PROPERTY, PLANT AND EQUIPMENT, NET December 31, 2015 2014 Cost: Machinery and manufacturing equipment, net(1) $ 218,610 $ 173,937 Office equipment and furniture 12,757 8,633 Motor vehicles 855 948 Buildings and leasehold improvements 99,607 77,281 Prepaid expenses related to operating lease(2) 939 939 332,768 261,738 Accumulated depreciation 107,330 88,745 Depreciated cost $ 225,438 $ 172,993 (1) Presented net of investment grants received in 2004, 2005 and 2006 years, in the total amount of $ 7,200 (2) Until 2012, the Company leased land from the Israel Lands Administration ("ILA") for its Bar-Lev manufacturing facility. The lease term started on February 6, 2005. The lease is for an initial non-cancellable term of 49 49 In 2014, the Company derecognized fully depreciated property, plant and equipment that will not be used, in a total amount of $ 2,003 Depreciation expense were $ 19,243 13,974 11,626 |
OTHER INTANGIBLES ASSETS
OTHER INTANGIBLES ASSETS | 12 Months Ended |
Dec. 31, 2015 | |
OTHER INTANGIBLES ASSETS [Abstract] | |
OTHER INTANGIBLES ASSETS | NOTE 6:- OTHER INTANGIBLES ASSETS December 31, 2015 2014 Original amounts: Non-compete agreement $ 1,453 $ 1,672 Distribution relationships 1,594 1,698 Customer relationships 5,910 6,588 Distribution agreement 14,606 14,616 23,563 24,574 Accumulated amortization: Non-compete agreement (1,434 ) (1,646 ) Distribution relationships (1,305 ) (1,311 ) Customer relationships (4,962 ) (4,458 ) Distribution agreement (8,979 ) (7,100 ) (16,680 ) (14,515 ) Total other intangibles assets $ 6,883 $ 10,059 (1) Amortization expense amounted to $ 3,091 3,202 3,368 (2) Estimated amortization expenses for the following years as of December 31, 2015: 2016 $ 2,338 2017 2,304 2018 2,241 $ 6,883 |
GOODWILL
GOODWILL | 12 Months Ended |
Dec. 31, 2015 | |
GOODWILL [Abstract] | |
GOODWILL | NOTE 7:- GOODWILL The changes in the carrying amount of goodwill for the years ended December 31, 2015 and 2014 are as follows: Balance as of December 31, 2013 $ 39,702 Foreign currency translation adjustments (1,742 ) Balance as of December 31, 2014 $ 37,960 Foreign currency translation adjustments (2,139 ) Balance as of December 31, 2015 $ 35,821 |
SHORT-TERM BANK CREDIT
SHORT-TERM BANK CREDIT | 12 Months Ended |
Dec. 31, 2015 | |
SHORT-TERM BANK CREDIT [Abstract] | |
SHORT-TERM BANK CREDIT | NOTE 8:- SHORT-TERM BANK CREDIT a. Short-term bank credit and loans are classified as follows: Weighted average interest Currency December 31, December 31, 2015 2014 2015 2014 % Short-term bank credit CAD 3.04 - $ 3,241 $ - b. As of December 31, 2015 and 2014, the Company had short-term and revolving credit lines of approximately $ 11,785 (out of which $3,241 million were utilized as presented in the table above) and 9,863 (none of which were utilized), |
ACCRUED EXPENSES AND OTHER LIAB
ACCRUED EXPENSES AND OTHER LIABILITIES | 12 Months Ended |
Dec. 31, 2015 | |
ACCRUED EXPENSES AND OTHER LIABILITIES [Abstract] | |
ACCRUED EXPENSES AND OTHER LIABILITIES | NOTE 9:- ACCRUED EXPENSES AND OTHER LIABILITIES December 31, 2015 2014 Employees and payroll accruals $ 10,438 $ 10,582 Accrued expenses 7,138 7,394 Advances from customers 574 42 Taxes payable 2,647 1,915 Warranty provision 1,239 1,475 Derivatives 1,421 2,900 Phantom share based payment 390 750 Legal settlements and loss contingencies (see also note 10) 3,647 - Other 492 716 $ 27,986 $ 25,774 |
COMMITMENTS AND CONTINGENT LIAB
COMMITMENTS AND CONTINGENT LIABILITIES | 12 Months Ended |
Dec. 31, 2015 | |
COMMITMENTS AND CONTINGENT LIABILITIES [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | NOTE 10:- COMMITMENTS AND CONTINGENT LIABILITIES a. Legal proceedings and contingencies: Claim by former South African distributor In December 2007, the Company terminated its agency agreement with its former South African agent, World of Marble and Granite (WOMAG), on the basis that WOMAG had breached the agreement. In the same month, the Company filed a claim for NIS 1.0 257 15.7 17,060 7.1 7,727 43.7 2,808 Claims related to alleged silicosis injuries Overview The Company is subject to a number of claims in Israel mainly by fabricators or their employees alleging that they contracted illnesses, including silicosis, through exposure to silica particles during cutting, polishing, sawing, grinding, breaking, crushing, drilling, sanding or sculpting Company's products. Individual Claims As of December 31, 2015, the Company is subject to 71 Company directly, or that have named the Company as third-party defendant by fabricators or their employees in Israel, by the injured's successors, by the State of Israel or by others (see also table below). The Company have also received nine pre-litigation demand letters on behalf of certain fabricators in Israel. Each of the claims named other defendants, such as fabricators that employed the plaintiffs, the Israeli Ministry of Industry, Trade and Employment, distributors of the Company's products, insurance companies and insurance brokers. Various arguments are raised in the claims, including among others product liability arguments and failure to provide warnings regarding the risks associated with silica dust generated by the fabrication of the Company's products. Most of the claims do not specify a total amount of damages sought, as the plaintiff's future damages will be determined at trial; A claim filed with the Magistrates court in Israel is limited to a maximum of NIS 2.5 641 45 During 2015, the Company reassessed the expected outcome of the individual product liability claims following Company's consent to several settlements. In addition the Company entered into an agreement with the State of Israel, with the approval of it's insurance carriers, related to product liability individual claims (not including the claim seeking class action status). Under the agreement, without admitting any liability, the Company and the State of Israel has agreed to cooperate in dealing with the claims. If either the Company or the State of Israel is found liable for damages, the Company has agreed to an apportionment of those damages. Based on the above, the Company assessed, based also on its legal advisors' opinion, that contingent losses related to the product liability individual claims are probable, pursuant to ASC 450, an accrual has been recorded for the loss contingencies related to such claims. In order to reasonably estimate the losses in the product liability claims, the Company performed a case-by-case analysis of the relevant facts with its legal advisors. The Company will continue to regularly monitor changes in facts for each individual claim and will update its best estimate if required Accordingly, the Company recorded during 2015 a reserve for the product liability individual claim of $ 14,837 3,647 11,190 2015 2014 2013 Open claims, January 1 54 27 20 New claims 19 28 8 Settled and dismissed claims (2 ) (1 ) (1) Open claims, December 31 71 54 27 The Company maintains insurance for product liability claims, including silicosis claims. The Company has purchased insurance policies for the period from 2008-2015 from several insurance carriers that provide coverage for product liability losses, subject to certain terms and conditions, and the related defense costs up to a certain limit per policy year. The Company records insurance receivables for the amounts that are covered by insurance less deductibles. During 2015, as in prior years, Company's insurance carriers made payments to all settled product liability claims and for related defense costs. The Company paid the deductible amounts for the settled claims per policy. The collectability of the Company's insurance receivables is regularly evaluated and the amounts recorded are probable of collection. This conclusion is based on analysis of the terms of the underlying insurance policies, experience in successfully recovering individual product liability claims from Company's insurers, the financial ability of the insurance carriers to pay the claims and the relevant facts and applicable law. As of December 31, 2015, the insurance receivable is $ 10,183 3,567 6,616 The difference between individual claims liability and related insurance recievables is recorded in the legal settelments and loss contingencies in the amount of 4,654 , which reflects the deductible amounts and claims not covered. December 2013 Judgment In December 2013, a judgment was entered by the Central District Court of Israel in one of the lawsuits, according to which the Company was found to be comparatively liable for 33 40 27 5.3 1,400 National Insurance Institute (NII) 800,000 206 plus legal fees and expenses, which reflected 25% of the plaintiff actual damages, after deducting the plaintiff's contributory negligence. After giving effect to the Israeli Ministry of Industry's comparative responsibility, the total liability imposed on the Company in this case was 436,669 112 During 2015, t Class Action In April 27, 2014, a lawsuit by single plaintiff and a motion for the recognition of this lawsuit as a class action was filed against the Company in the Central District Court in Israel. The plaintiff alleges that, if the lawsuit is recognized as a class action, the claim against the Company is estimated to be NIS 216 55,356 The Company intends to vigorously contest recognition of the lawsuit as a class action and to defend the lawsuit on its merits, although, considering the preliminary stage of this lawsuit, there can be no assurance as to the probability of success or the range of potential exposure, if any. As of December 31, 2015, no provision was provided for the loss contingencies. Arbitration proceeding with Microgil Agricultural Cooperative Society Ltd. In November 2011, Kfar Giladi and Microgil (the claimants), initiated arbitration proceedings against the Company that commenced in April 2012 The claimants filed a claim against the Company in arbitration for NIS 232.8 million ($ 59.7 for alleged damages and losses incurred by them in connection with a breach of Processing Agreement by the Company. In August 2012, the Company filed a claim against the claimants in arbitration for NIS 76.6 19.6 The arbitration arises out of a dispute related to the Processing Agreement that the Company entered into with the claimants in June 2006 pursuant to which the claimants committed to establish a production facility at their own expense within 21 months of the date of the Processing Agreement to process quartz for the Company and for other potential customers. Pursuant to the Processing Agreement, the Company committed to pay fixed prices for quartz processing services related to agreed-upon quantities of quartz over a period of ten years from the date set for the claimants to commence operating the production facility. The Company estimates that the total amount of such payments would have been approximately $ 55,000 It is Company's position that the production facility established by the claimants was not operational until approximately two years after the date required by the Processing Agreement. As a result, the Company was unable to purchase the minimum quantities set forth in the Processing Agreement and therefore acquired the quantities of ground quartz needed from other quartz suppliers In January 2012, claimants notified that they had closed their production facility as a result of Compnay's breach of the Processing Agreement. It is Company's position that the Processing Agreement was terminated by the Company following it's breach by the claimants. The Company contends that the purchases of ground quartz in 2010 and 2011 were made pursuant to new understandings reached between the parties and not pursuant to the Processing Agreement. The claimants alleged that the Processing Agreement was still in effect and that the Company did not meet the contractual commitments under the Processing Agreement to order the minimum annual quantity. In addition, once production began, the Company contends that the claimants failed to consistently deliver the required quantity and quality of ground quartz as agreed by the parties. The Company also contends that the claimants are responsible for not returning unprocessed quartz that the Company provided to them, including quartz that is currently in the claimants' possession and additional quartz that is unaccounted for. In November 2015, the claimants filed a motion to require the Company to deposit a bond in the amount of 100 25.6 and asking for an injunction to prevent the disposition of assets, plants and equipment valued at no less than NIS 149.2 38.2 The Company believes that such motion is groundless and applied for its dismissal, however there can be no assurance that such motion shall be dismissed. The Company intends to defend the arbitration vigorously and to seek damages from the claimants for damage caused. Claim by the Israel Ministry of the Protection of the Environment In January 2010, the Israel Ministry of the Protection of the Environment ("IMPE") ordered the Company to remove sludge waste that was disposed of in 2009 in a number of locations in northern Israel claiming that such disposal was unlawful. The Company has engaged in discussions with the IMPE with respect to which sites will require waste removal. The Company performed a feasible and practical clean-up project and currently in the opinion that its clean-up project was sufficient and it has no further exposure in this respect. The Company has also been required by the IMPE to comply with the applicable requirements under the law and regulations related to styrene gas emission at both of its plants in Israel. In December 2013, the Company completed the installation of a system in its Bar-Lev manufacturing facility to reduce styrene emission and following which the Company has better control of the styrene emission in the Bar-Lev manufacturing facility and the Company presented to IMPE a plan to further improve its control of styrene emission and comply with the styrene gas emission standards With respect to the Sdot-Yam manufacturing facility the IMPE has summoned the Company in January 2014 to a hearing to address allegations that, based on the IMPE's procurement of several gas emission samplings, the Company exceeded the air ambient standards. Following the hearing, and although the IMPE acknowledged that the Company was in the process of installing measures to comply with the styrene gas emission standards, the IMPE decided to recommend the conducting of In 2015, the Company continued to control styren emission levels through strict maintenance and compliance with work processes. However, the IMPE has recently indicated that it intends to conduct unannounced inspections of the Company's facilities and if not fully complied with the styrene emission standards, Compnay's business license may be revoked, facilities may be shutdown and the Company may be subject to civil and criminal sanctions. Other Regulation Legal Procedure and a hearing by the Israeli Ministry of Economy and Industry with respect to Israeli Hours of Work and Rest Law, 1951 and the employment of Jewish employees on Saturdays. The Company is subject to the Israeli Hours of Work and Rest Law, 1951 ("Rest Law"), which forbids the employment of Jewish employees on Saturdays and Jewish holidays, unless a permit is obtained from the Israeli Ministry of Economy and Industry. Company's employees, including Jewish and other employees, work in three shifts a day of an average length of eight hours each, seven days a week. On September 20, 2014, an inspection of the Israeli Ministry of Economy and Industry in the Bar-Lev manufacturing facility has found three Jewish employees employed on a Saturday. Following this inspection the Company was summoned to a hearing by the Israeli Ministry of Economy and Industry. Securities Class Action Claim On August 25, 2015, a purported purchaser of Company's ordinary shares filed a proposed class action in the United States District Court for the Southern District of New York asserting, among other things, that the Company and two On February 26, 2016, the Company filed a motion to dismiss the amended complaint. Expenses incurred as a result of this claim will be covered under the Company's directors and officers liability insurance policy, subject to deductible and to coverage terms and limits. Although the early stages of the claim and the inability to estimate the Company's exposure thereunder, if any, the Company believes this claim is without merit and intends to contest it vigorously. From time to time, the Company is involved in other legal proceedings and claims in the ordinary course of business related to a range of matters. While the outcome of these other claims cannot be predicted with certainty, the Company's management does not believe that any such claims or all of them together will have a material effect on the Company's consolidated financial statements. b. Operating lease commitments: The land and certain of the Company's facilities and vehicles are leased under operating lease agreements. Future minimum lease commitments under non-cancellable operating leases for the specified periods ending after December 31, 2015 are as follows: 2016 $ 13,075 2017 11,698 2018 10,040 2019 8,593 2020 6,617 2021 and thereafter 46,266 Total $ 96,289 Lease expenses, for the years ended December 31, 2015, 2014 and 2013 were approximately $ 12,109 11,545 12,608 c. Purchase obligation: The Company's significant contractual obligations and commitments as of December 31, 2015 are summarized in the following table: 2016 (1) $ 3,808 2017 and thereafter - $ 3,808 (1) Consists of purchase obligations to certain suppliers. d. Pledges and guarantees: 1. As of December 31, 2015, the Company had outstanding guarantees and letters of credit with various expiration dates in a principal amount of approximately $ 1,210 2. Company's credit facilities provided by banks in Israel are secured with a Negative floating pledge, whereby the Company committed not to pledge or charge and not to undertake to pledge or charge its general floating assets. 3. To secure the Company's liabilities to a bank in Canada, Caesarstone Canada Inc. has provided a security interest on certain of its inventory and other tangible and intangible assets. |
TAXES ON INCOME
TAXES ON INCOME | 12 Months Ended |
Dec. 31, 2015 | |
TAXES ON INCOME [Abstract] | |
TAXES ON INCOME | NOTE 11:- TAXES ON INCOME a. Israeli taxation: 1. Corporate tax rate: The corporate tax rate in Israel was 26.5 25 On January 4, 2016, the Israeli Parliament's Plenum approved by a second and third reading the Bill for Amending the Income Tax Ordinance (No. 217) (Reduction of Corporate Tax Rate) which consists of the reduction of the corporate 25 2. Foreign Exchange Regulations: Commencing in taxable year 2014, the Company has elected to measure its taxable income and file its tax return under the Israeli Income Foreign Tax Regulations. Under the Foreign Exchange Regulations, an Israeli company must calculate its tax liability in U.S. Dollars according to certain orders and then translated into NIS according to the exchange rate as of December 31st of each year. For taxable years up to 2013, the Company measured its taxable income and filed its tax returns in NIS 3. Tax benefits under Israel's Law for the Encouragement of Industry (Taxes), 1969: The Company is an "Industrial Company," as defined by the Law for the Encouragement of Industry (Taxes), 1969, and as such, the Company is entitled to certain tax benefits, primarily amortization of costs relating to know-how and patents over eight years, accelerated depreciation and the right to deduct public issuance expenses for tax purposes 4. Tax benefits under the Law for the Encouragement of Capital Investments, 1959: According to the Law for the Encouragement of Capital Investments, 1959 (the "Encouragement Law"), the Company is entitled to various tax benefits by virtue of the "Preferred Enterprise" status granted to its enterprises, in accordance with the Encouragement Law The Company chose to be taxed according to the The principal benefits by virtue of the Encouragement Law are the following: Tax benefits and reduced tax rates under the Preferred Enterprise track: In order to receive benefits as a "Preferred Enterprise," Amendment No. 68 states certain conditions must be met. The basic condition for receiving the benefits under Amendment No. 68 is that the enterprise contributes to the country's economic growth and is a competitive factor for the gross domestic product (a "competitive enterprise"). In order to comply with this condition, the Encouragement Law prescribes various requirements. As for industrial enterprises, in each tax year, one of the following conditions must be met: 1. Its main field of activity is biotechnology or nanotechnology as approved by the Head of the Administration of Industrial Research and Development. 2. The industrial enterprise's sales revenues in a specific market during the tax year do not exceed 75% of its total sales for that tax year. A "market" is defined as a separate country or customs territory. 3. At least 25% of the industrial enterprise's overall revenues during the tax year were generated from the enterprise's sales in a specific market with a population of at least 14 million starting from 2012 tax year. The tax rate on preferred income form a Preferred Enterprise in 2014 and onwards is 16% and in development area A - 9%. In 2013, the tax rate on preferred income from a Preferred Enterprise is 12.5% The Amendment also prescribes that any dividends distributed to individuals or foreign residents from the preferred enterprise's earnings as above will be subject to tax at a rate of 20% from 2014 and onwards (or a reduced rate under an applicable double tax treaty). Upon a distribution of a dividend to an Israeli company, no withholding tax is remitted. Since the Company chose to apply the provisions of Amendment No. 68, by submitting the waiver form before June 30, 2015, the Company is eligible to distribute taxed earnings derived from a Beneficiary Enterprise and/or Approved Enterprise to an Israeli company without being subject to withholding tax. In development area A, in addition to the tax benefits, as mentioned above, some of the Company's facilities are eligible for grants at rate of 20% and/or loans, subject to an approval of the Israeli Investment Center. Accelerated depreciation: The Company is eligible for a deduction of accelerated depreciation on machinery and equipment used by the Approved Enterprise or the Beneficiary Enterprise or the Preferred Enterprise at a rate of 200% (or 400% for buildings) from the first year of the asset's operation. Conditions for entitlement to benefits: The above mentioned benefits are contingent upon the fulfillment of the conditions stipulated by the Encouragement Law, regulations published thereunder and the letters of approval for the investments in the Preferred Enterprises, as discussed above. Non-compliance with the conditions may cancel all or part of the benefits and require a refund of the amount of the benefits, including interest. The Company's management believes that the Company is meeting the aforementioned conditions. Of the Company's retained earnings as of December 31, 2015, approximately $ 19,828 15,494 As of December 31, 2015, if the income attributed to the Approved Enterprise would have been distributed as a dividend, the Company would have incurred a tax liability of approximately $ 5,254 4,106 b. Non-Israeli subsidiaries taxation: Non-Israeli subsidiaries are taxed based on tax laws in their countries of residence. Statutory tax rates for Non-Israeli subsidiaries are as follows: Company incorporated in United States - 40% tax rate. Company incorporated in Australia - 30% tax rate. Company incorporated in Singapore - 17% tax rate. Company incorporated in Canada 26.39% tax rate. Israeli income taxes and foreign withholding taxes were not provided for undistributed earnings of the Company's foreign subsidiaries (excluding the Company's subsidiary in Canada). The Company intends to reinvest these earnings indefinitely in the foreign subsidiaries. Accordingly, no deferred income taxes have been provided. If these earnings were distributed to Israel in the form of dividends or otherwise, the Company would be subject to additional Israeli income taxes (subject to an adjustment for foreign tax credits) and foreign withholding taxes c. Deferred income taxes: Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets and liabilities are as follows: December 31, 2015 2014 Deferred tax assets (liability): Intangible assets $ - $ 110 Other temporary differences (1) 6,349 5,636 Temporary differences related to inventory 1,755 637 Phantom award 21 53 Unrealized profit from sales to subsidiary 4,944 3,355 Less-valuation allowance (310 ) (331 ) Total net deferred tax assets 12,759 9,460 Deferred tax liabilities Property and equipment (13,734 ) (3,081 ) Intangible assets (2,486 ) (2,910 ) Other temporary differences (141 ) (20 ) Total deferred tax liabilities (16,361 ) (6,011 ) Deferred tax assets (liability), net $ (3,602) $ 3,449 (1) Deriving mainly from the following - provision for bad debts, labor provisions, warranty provision and related party liability for tax purposes. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the schedule of reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment d. A reconciliation of the Company's effective tax rate to the statutory tax rate in Israel is as follows: Year ended December 31, 2015 2014 2013 Income before taxes on income $ 93,301 $ 93,997 $ 74,689 Statutory tax rate in Israel 26.5 % 26.5 % 25 % Income taxes at statutory rate $ 24,725 $ 24,909 $ 18,672 Increase (decrease) in tax expenses resulting from: Tax benefit arising from reduced rate as an "Approved Enterprise" (13,232 ) (12,482 ) (11,267 ) Non-deductible expenses, net 1,073 856 1,274 Adjustment for change in tax law - - 575 Decrease in taxes resulting from tax settlement with tax authorities (513 ) (286 ) - Tax adjustment in respect of foreign subsidiaries' different tax rates 693 634 741 Uncertain tax position 1,034 146 219 Changes in valuation allowance (21 ) (66 ) 97 Others 84 27 25 Income tax expense $ 13,843 $ 13,738 $ 10,336 Effective tax rate 15 % 15 % 14 % Per share amounts (basic) of the tax benefit resulting from an "Approved Enterprise" $ (0.38 ) $ (0.36 ) $ (0.32 ) Per share amounts (diluted) of the tax benefit resulting from an "Approved Enterprise" $ (0.37 ) $ (0.35 ) $ (0.32 ) e. Income before taxes on income is comprised as follows: Year ended December 31, 2015 2014 2013 Domestic $ 81,020 $ 82,670 $ 65,657 Foreign 12,281 11,327 9,032 $ 93,301 $ 93,997 $ 74,689 f. Tax expenses on income are comprised as follows: Year ended December 31, 2015 2014 2013 Current taxes $ 6,792 $ 16,318 $ 10,119 Deferred taxes 7,051 (2,580 ) 217 $ 13,843 $ 13,738 $ 10,336 Domestic $ 9,892 $ 9,646 $ 6,395 Foreign 3,951 4,092 3,941 $ 13,843 $ 13,738 $ 10,336 g. Tax assesments The Company operates in multiple jurisdictions throughout the world, and its tax returns are periodically audited or subject to review by both domestic and foreign authorities. The associated tax filings remain subject to examination by applicable tax authorities for a certain length of time following the tax year to which those filings relate. The following describes the open tax years, by major tax jurisdiction, as of December 31, 2015: Israel 2012 Australia 2011 Canada 2010 United States 2012 Singapore 2011 h. Uncertain tax positions: The balances at December 31, 2015 and 2014 include a liability for unrecognized tax benefits of $ 1,442 417 for tax positions which are uncertain of being sustained. The accruals are with respect to the eligibility of certain income sources to the reduced tax rates under the Company's Approved Enterprise, Beneficiary Enterprise, and Preferred Enterprise programs as well as with respect to some expenses, which deduction for tax purposes is uncertain. The Company recognizes interest and penalties related to income taxes in its tax expense line in its consolidated statements of income. The Company had approximately $ 37 20 A reconciliation of the beginning and ending balances of unrecognized tax benefits is as follows: Gross tax liabilities at January 1, 2013 $ 1,084 Increases in tax positions for current year 151 Addition of tax position of prior years 68 Foreign currency adjustments 92 Gross tax liabilities at December 31, 2013 1,395 Increases in tax positions for current year 146 Addition of tax position of prior years (1,076 ) Foreign currency adjustments (48 ) Gross tax liabilities at December 31, 2014 417 Increases in tax positions for current year 493 Addition of tax position of prior years 541 Foreign currency adjustments (9 ) Gross tax liabilities at December 31, 2015 $ 1,442 The Company believe that an adequate provision has been made for any adjustments that may result from tax examinations. However, the outcome of tax audits cannot be predicted with certainty. If any issues addressed in the Company's tax audits are resolved in a manner not consistent with management's expectations, The Company could be required to adjust the provision for income taxes in the period such resolution occurs. The Company does not expect uncertain tax positions to change significantly over the next 12 months, except in the case of settlements with tax authorities, the likelihood and timing of which is difficult to estimate. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2015 | |
SHAREHOLDERS' EQUITY [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 12:- SHAREHOLDERS' EQUITY a. The Company's share capital consisted of the following as of December 31, 2015 and 2014: Authorized Issued and outstanding December 31, December 31, 2015 2014 2015 2014 Shares of NIS 0.04 Ordinary shares 200,000,000 200,000,000 35,294,755 35,132,127 b. Ordinary shares-ordinary shares confer on their holders voting rights and the right to receive dividends. c. Dividends: The Company paid dividends in the amount of $ 0 20,025 20,149 d. Compensation plan: On January 1, 2011, the Board of Directors adopted the Caesarstone Sdot-Yam 2011 Incentive Compensation Plan pursuant to which non-employee directors, officers, employees and consultants may receive stock options and RSUs exercisable for ordinary shares, if certain conditions are met. In December 2015, Company's Board of Directors approved an amendment to the 2011 Incentive Compensation Plan increasing the number of ordinary shares that may be granted under such plan by 900,000 As of December 31, 2015, there were 1,040,585 1,304,910 As of December 31, 2015, there was $ 9,743 1.38 The following is a summary of activities relating to the Company's stock options granted to employees under the Company's plan during the year ended December 31, 2015: Number of options Weighted average exercise price Aggregate intrinsic Outstanding - beginning of the year 401,295 $ 10.09 Granted 784,000 $ 37.92 Exercised (193,029 ) $ 9.85 Forfeited (6,781 ) $ 9.85 Outstanding - end of the year 985,485 $ 32.28 $ 10,899 Options exercisable at the end of the year 103,747 $ 37.66 $ 589 Vested and expected to vest 985,485 $ 32.28 $ 10,899 The weighted average fair value of options granted during 2015 was $ 12.32 6,465 The intrinsic value of exercisable options (the difference between the Company's closing share price on the last trading day in fiscal 2015 and the average exercise price of in-the-money options, multiplied by the number of in-the-money options) included above represents the amount that would have been received by the option holders had all option holders exercised their options on December 31, 2015. This amount changes based on the fair market value of the Company's ordinary shares. The following is a summary of activities relating to the Company's RSUs granted to employees under the Company's plan during the year ended December 31, 2015: Number of RSUs Weighted average fair value Aggregate intrinsic value Outstanding - beginning of the year - $ - Granted 55,100 $ 35.04 Exercised - $ - Forfeited - $ - Outstanding - end of the year 55,100 $ 35.04 $ 2,387 RSUs exercisable at the end of the year - $ - $ - Vested and expected to vest 55,100 $ 35.04 $ 2,387 The awards outstanding as of December 31, 2015 have been separated into ranges of exercise price, as follows: Awards outstanding Awards exercisable Exercise price Number of options Weighted average remaining contractual life (years) Weighted average exercise price per share Number of options Weighted average remaining contractual life (years) Weighted average exercise price $ 0.01 (RSUs) 55,100 6.83 $ 0.01 - - - $ 9.85 181,485 3.22 $ 9.85 3,747 3.22 9.85 $ 14.69 20,000 3.84 $ 14.69 10,000 3.84 14.69 $ 34.60 404,000 6.82 $ 34.60 - - - $ 41.37 42.96 380,000 6.73 $ 41.45 90,000 6.71 41.37 1,040,585 103,747 Compensation expenses related to options and RSUs granted were recorded in the consolidated statements of operations, as follows: December 31, 2015 2014 Cost of revenues $ 121 $ 75 Research 96 52 Selling and marketing expenses 259 210 General and administrative expenses 2,131 875 Total $ 2,607 $ 1,212 |
TRANSACTIONS WITH RELATED PARTI
TRANSACTIONS WITH RELATED PARTIES AND OTHER LOAN | 12 Months Ended |
Dec. 31, 2015 | |
TRANSACTIONS WITH RELATED PARTIES AND OTHER LOAN [Abstract] | |
TRANSACTIONS WITH RELATED PARTIES AND OTHER LOAN | NOTE 13:- TRANSACTIONS WITH RELATED PARTIES The Company's controlling shareholder, Kibbutz Sdot-Yam, established Caesarstone in 1987 and has an ownership interest in the Company of approximately 32.4 a. Manpower Agreement with Kibbutz: On July 2011, the Company entered into a manpower agreement with Kibbutz Sdot-Yam for a term of 10 that will be automatically renewed, unless one of the parties gives six one On July 30, 2015, following the approval of Company's audit committee, compensation committee and board of directors, Company's shareholders approved an addendum to the Manpower Agreement by and between Kibbutz Sdot-Yam and the Company, with respect to the engagement of office holders affiliated with Kibbutz Sdot-Yam, for an additional three Under the manpower agreement and its addendum, Kibbutz Sdot-Yam will provide the Company with labor services staffed by Kibbutz members, candidates for Kibbutz membership and Kibbutz residents (Kibbutz Appointees). The consideration to be paid for each Kibbutz Appointee will be based on the Company's total cost of employment for a non-Kibbutz Appointee employee performing a similar role. The number of Kibbutz Appointees may change in accordance with the Company's needs. Under the manpower agreement, the Company will notify Kibbutz Sdot-Yam of any roles that require staffing, and if the Kibbutz offers candidates with skills similar to other candidates, the Company will give preference to hiring of the relevant Kibbutz members. Kibbutz Sdot-Yam is entitled under this agreement, at its sole discretion, to discontinue the engagement of any Kibbutz Appointee of manpower services through his or her employment by Kibbutz Sdot-Yam and require such appointee to become employed directly by the Company. The Company will contribute monetarily to assist with the implementation of a professional reserve plan to encourage young Kibbutz members to obtain the necessary education for future employment with the Company. The Company will provide up to NIS 250,000 64 The Company will also implement a policy that prioritizes the hiring of such young Kibbutz members as the Company's employees upon their graduation. The manpower agreement and addendum also includes Kibbutz Sdot-Yam's obligation to customary liability, insurance, indemnification and confidentiality and intellectual property provisions. Office holders who are Kibbutz Appointees shall have all benefits applicable to Company's other office holders, including without limitation, directors' and officers' liability insurance, and Company's indemnification and exemption undertaking Manpower service fees were $ 3,425 3,939 3,857 b. Services from the Kibbutz: On July 20, 2011 the Company signed a service agreement with the Kibbutz that was further amended on February 13, 2012 (the original services agreement). Pursuant to the agreement, the Kibbutz provided various services related to Company's operational needs. The original services agreement also outlined the distribution mechanism between the Company and Kibbutz Sdot-Yam, for certain expenses and payments due to local authorities, such as taxes and fees in connection with Company's business facilities. The agreement expired on March 21, 2015 On July 30, 2015, following the approval of the audit committee and the board, Company's shareholders approved an amended services agreement (the amended services agreement). Under the amended services agreement, Kibbutz Sdot-Yam will continue to provide various services it provides in the ordinary course of our business, for a period of three years commencing as of the date of approval by the shareholders. The amended services agreement grants Kibbutz Sdot-Yam a right of first refusal with respect to such services following a review procedure that the Company is entitled to conduct once a year. Under this review procedure, the Company may seek independent third-party proposals through a competitive bidding process, in order to verify that the Kibbutz's services are provided at market terms. The amount that the Company pays to Kibbutz Sdot-Yam under the amended services agreement depends on the scope of services the Company will receive and is based on rates specified in such agreement which were determined based on market terms, taking into account the added value of consuming services from Kibbutz Sdot-Yam, considering its physical proximity to Company's manufacturing plant in Sdot-Yam and its expertise. The amounts the Company pays for the services are subject to certain adjustments for increases in the Israeli consumer price index. In addition, the amended services agreement grants Kibbutz Sdot-Yam the right to adjust the rates of the metal workshop services and the meals it provides to Company's employees once a year, in the event that raw material prices related to such services significantly increase during the term of the agreement. In such case, the Company is entitled to conduct a review procedure with respect to such services, in which the Kibbutz shall have the right of first refusal to provide the services on terms identical to the best terms offered to the Company by a third party bidder. Each party may terminate such agreement upon a material breach, following a 30 -day prior notice, or upon liquidation of the other party, following a 45 -days' prior notice. The Company's service fees to the Kibbutz pursuant to the original and amended services agreements were $ 1,806 2,118 2,112 c. Land Use Agreement with the Kibbutz: The Company's principal offices and research and development facilities, as well as one of its two manufacturing facilities, are located on the grounds of the Kibbutz and include buildings spaces of approximately 30,744 60,870 The Company signed a land use agreement with the Kibbutz, which has a term of 20 100,000 12.9 3,500 62,000 18 The annual fee may be adjusted after January 1, 2021 (or after January 1, 2018 if the Kibbutz is required to pay significantly higher lease fees to the Israeli land authorities or Caesarea Development Corporation Ltd.) and every three years thereafter, if Kibbutz Sdot-Yam chooses to obtain an appraisal. The appraiser will be mutually agreed upon or, in the absence of agreement, will be chosen by Kibbutz Sdot-Yam out of the list of appraisers recommended at that time by Bank Leumi Le-Israel ("Bank Leumi"). Under the land use agreement, the Company may not terminate the operation of either of its two production lines at its plant in Kibbutz Sdot-Yam as long as the Company continues to operate production lines elsewhere in Israel, and its headquarters must remain at Kibbutz Sdot-Yam. The Company may also not decrease or return to Kibbutz Sdot-Yam any part of the land underlying the land use agreement; however, it may submit a written request to Kibbutz Sdot-Yam to return certain lands. Kibbutz Sdot-Yam will have three months to accept or reject such request, in its sole discretion, provided that if it does not respond within such three-month period, the Company will be entitled to sublease such lands to a person approved in advance by Kibbutz Sdot-Yam. In such event, the Company will continue to be liable to Kibbutz Sdot-Yam with respect to such lands Pursuant to the land use agreement, if the Company needs additional facilities on the land that the Company is permitted to use in Kibbutz Sdot-Yam, subject to obtaining the permits required by law, Kibbutz Sdot-Yam will build such facilities for the Company, by using the proceeds of a loan that the Company will make to Kibbutz Sdot-Yam, which loan shall be repaid to the Company by off-setting the monthly additional payment that the Company will pay for such new facilities and, if not fully repaid during the land use agreement term, upon termination thereof. Starting from January 1, 2014 the Company is making use as needed of additional office space in Kibbutz Sdot-Yam of approximately 400 77,956 20 116,643 30 9,000 10,000 3 90 In addition, the Company has committed to fund the cost of construction, up to a maximum of NIS 3.3 800 leading to Kibbutz Sdot-Yam and its facilities, such that the entrance of the Company's facilities will be separated from the entrance into Kibbutz Sdot-Yam. In addition, the Company has committed to pay NIS 200,000 51 cover the cost of paving an area of land leased from Kibbutz Sdot-Yam with such payment to be deducted in monthly installments over a four-year period beginning in 2013 from the lease payments to be made to Kibbutz Sdot-Yam under the land use agreement related to the Company's Sdot-Yam facility Pursuant to agreement for arranging for additional accord between the Company and Kibbutz Sdot-Yam dated July 20, 2011, if the Company wishes to acquire or lease any additional lands, whether on the grounds of the Company's Bar-Lev manufacturing facility, or elsewhere in Israel, for the purpose of establishing new plants or production lines: (i) Kibbutz Sdot-Yam will purchase the land and build the required facilities' structure on such land at its own expense in accordance with the Company's needs; (ii) the Company will perform any necessary building adjustments at the Company's expense; and (iii) Kibbutz Sdot-Yam will lease the land and the facility to the Company under a long-term lease agreement with terms to be negotiated in accordance with the then prevailing market price. In addition, under this agreement, Kibbutz Sdot-Yam has agreed not to compete with the Company as long as it holds more than 10% of the Company's shares This agreement terminates on October 20, 2017. Pursuant to the above agreement, the Company has entered into an agreement with Kibbutz Sdot-Yam dated August 6, 2013, under which Kibbutz Sdot-Yam acquired additional land of approximately 12,800 square meters on the grounds near the Company's Bar-Lev facility, which the Company required in connection with the construction of the fifth production line at the Company's Bar-Lev manufacturing facility, for a monthly fee of approximately NIS 70,000 18 Under the agreement, Kibbutz Sdot-Yam committed to (i) acquire the long-term leasing rights of the Additional Bar-Lev Land from the ILA, (ii) perform preparation work and construction, in conjunction with the administrative body of Bar-Lev industrial park and other contractors according to Company's plans, (iii) build a warehouse according Company's plans, and (iv) obtain all permits and approvals required for performing the preparation work of the Additional Bar-Lev Land and for the building of the warehouse. The warehouse in Bar-Lev will be situated both on the current and new land. The finance of the building of the warehouse will be made through a loan that will be granted by the Company to Kibbutz Sdot-Yam, in the amount of the total cost related to the building of the warehouse and such loan, including principle and interest, shall be repaid by setoff of the lease due to Kibbutz Sdot Yam by the Company for its use of the warehouse. 5.3 On November 30, 2015 the land preparation work had been completed and the holding of the Additional Bar-Lev Land was delivered to the Company. As of December 31, 2015, the construction of the warehouse has not started yet. Pursuant to an agreement dated January 4, 2012, for the settlement of reimbursement for building expenses incurred by the Company from January 2012, NIS 82,900 24 43,000 12 The Company's payments pursuant to the land use agreement totaled $ 3,564 3,847 3,702 d. Land Purchase Agreement and Leaseback: Pursuant to a land purchase and leaseback agreement, dated as of March 31, 2011, as amended on February 13, 2012, between the Company and Kibbutz Sdot-Yam, the Company completed the selling of the rights in the lands and facilities of the Bar-Lev Industrial Center (the "Bar-Lev Grounds") to Kibbutz Sdot-Yam in consideration for NIS 43.7 10,900 10 4.1 1,100 The Company's equipment that resides within the premises is considered integral equipment (as defined in ASC 360-20-15-4) due to the significant costs involved in relocating such equipment. Since the Company did not sell this equipment to Kibbutz Sdot-Yam as part of the transaction, the transaction is considered a partial sale and leaseback of real estate. As a result, the transaction does not qualify for "sale lease-back" accounting (as it is a failed sale from an accounting perspective) and the Company recorded the entire amount received as consideration as a liability while the land and building will remain on its books until the end of the lease term under the provisions of ASC 840-40. If amounts to be paid under the arrangement were to be accreted as a liability based on the Company's incremental borrowing rate, the resulting liability would not cover the anticipated depreciated cost of the building and land at the end of the lease (thereby creating a built-in loss). The entire amount that was paid was accreted to the full anticipated book value of the land and building at the end of the lease term using a higher effective interest rate that will equalize the amounts paid to the full anticipated book value of the land and building at the end of the lease. As of December 31, 2015, the Company's liability as a result of this transaction is in the amount of $ 9,647 The financing leaseback from related party 2016 $ 521 2017 554 2018 588 2019 624 2020 663 2021 and thereafter 6,697 $ 9,647 The balance at December 31, 2015 and 2014, includes $ 905 1,001 1,065 1,050 The Company's payments pursuant to the land purchase agreement and leaseback totaled $ 1,092 1,192 1,149 e. Bonus paid by a former shareholder: During 2013, the Company recorded a compensation expense in the amount of 810 Details on transactions and balances with related parties and other loan a. The Company has, from time to time, entered into transactions with its shareholders (the Kibbutz).The following table summarizes such transactions: Year ended December 31, 2015 2014 2013 Cost of revenues $ 7,638 $ 9,073 $ 8,792 Research and development $ 180 $ 123 $ 211 Selling and marketing $ 691 $ 373 $ 632 General and administrative $ 1,828 $ 2,538 $ 1,649 Finance expenses, net $ 597 $ 685 $ 671 b. Balances with related party and other loan: December 31, 2015 2014 Related party and other loan (1,2) $ 3,251 $ 3,975 Long-term loan and financing leaseback from a related party (2) $ 8,472 $ 8,993 (1) On January 17, 2011 a loan of 4 0.25 (2) In September, 2012, a financing leaseback of $ 10.9 6.19 |
MAJOR CUSTOMER AND GEOGRAPHIC I
MAJOR CUSTOMER AND GEOGRAPHIC INFORMATION | 12 Months Ended |
Dec. 31, 2015 | |
MAJOR CUSTOMER AND GEOGRAPHIC INFORMATION [Abstract] | |
MAJOR CUSTOMER AND GEOGRAPHIC INFORMATION | NOTE 14:- MAJOR CUSTOMER AND GEOGRAPHIC INFORMATION a. The Company manages its business on the basis of one reportable segment. The data is presented in accordance with Accounting Standard Codification 280, "Segments Reporting" ("ASC 280"). The following is a summary of revenue and long-lived assets by geographic area. Revenues are attributed to geographic areas based on the location of end customers. The following table presents total revenues for the years ended December 31, 2015, 2014 and 2013, respectively: Year ended December 31, 2015 2014 2013 USA $ 223,341 $ 185,583 $ 123,399 Australia 110,290 107,539 89,894 Canada 70,739 57,898 49,214 Israel 39,645 41,286 42,024 Europe 23,949 23,109 22,973 Rest of World 31,551 31,987 29,050 $ 499,515 $ 447,402 $ 356,554 b. The following table presents total long-lived assets as of December 31, 2015 and 2014: December 31, 2015 2014 Israel $ 88,658 $ 93,976 Australia 1,657 1,857 USA 133,481 75,873 Canada 1,548 1,144 Rest of World 94 143 $ 225,438 $ 172,993 |
SELECTED SUPPLEMENTARY STATEMEN
SELECTED SUPPLEMENTARY STATEMENTS OF INCOME DATA | 12 Months Ended |
Dec. 31, 2015 | |
SELECTED SUPPLEMENTARY STATEMENTS OF INCOME DATA [Abstract] | |
SELECTED SUPPLEMENTARY STATEMENTS OF INCOME DATA | NOTE 15:- SELECTED SUPPLEMENTARY STATEMENTS OF INCOME DATA a. Finance expense, net: Year ended December 31, 2015 2014 2013 Finance expenses: Interest in respect of long-term loans $ - $ - $ 53 Interest in respect of short-term loans and bank fees 2,792 3,038 1,565 Interest in respect of loans to related parties 640 732 729 Changes in derivatives fair value - 2,710 - Foreign exchange transactions losses 2,972 - 6,107 6,404 6,480 8,454 Finance income: Changes in derivatives fair value 1,060 - 6,485 Income in respect of cash and cash equivalent and short-term bank deposits 77 403 655 Foreign exchange transactions gains 2,182 5,032 - 3,319 5,435 7,140 Finance expenses, net $ 3,085 $ 1,045 $ 1,314 b. Net earnings per share: The following table sets forth the computation of basic and diluted net earnings per share: Numerator : Year ended December 31, 2015 2014 2013 Net income attributable to controlling interest, as reported $ 77,766 $ 78,439 $ 63,344 Numerator for basic and diluted net income per share $ 77,766 $ 78,439 $ 63,344 Denominator: Year ended December 31, 2015 2014 2013 Denominator for basic income per share 35,252,596 34,932,000 34,666,514 Effect of dilutive stock based awards 211,102 462,499 543,432 Denominator for diluted income per share 35,463,698 35,394,499 35,209,946 Earnings Per Share Year ended 2015 2014 2013 Basic earnings per share $ 2.21 $ 2.25 $ 1.83 Diluted earnings per share $ 2.19 $ 2.22 $ 1.80 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2015 | |
SUBSEQUENT EVENTS [Abstract] | |
SUBSEQUENT EVENTS | NOTE 16:- SUBSEQUENT EVENTS On February 9, 2016 the Company's Board of Directors approved a share repurchase plan authorizing the repurchase of up to $ 40,000 |
SIGNIFICANT ACCOUNTING POLICI24
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Use of estimates | a. Use of estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. The Company's management believes that the estimates, judgment and assumptions used are reasonable based upon information available at the time they were made. |
Financial statements in U.S. dollars | b. Financial statements in U.S. dollars: The Company's revenues are generated in U.S. dollars (USD), Australian dollars, Canadian dollars, Euros and New Israeli Shekels (NIS). In addition, most of the Company's costs are incurred in USD, NIS, Euros, Australian dollars, Canadian dollars and Singapore dollars. The Company's management believes that the USD is the primary currency of the economic environment in which the Company operates. Thus, the functional and reporting currency of the Company is the USD. The functional currency of the majority of the Company's foreign subsidiaries is the local currency in which it operates. Accordingly, monetary accounts maintained in currencies other than the are re-measured into dollars in accordance with Accounting Standards Codification ("ASC") 830, "Foreign Currency Matters". All transaction gains and losses resulting from the re-measurement of monetary balance sheet items denominated in non-USD currencies are reflected in the statements of operations as financial income or expenses as appropriate. The financial statements of the Company's subsidiaries of which the functional currency is not the USD have been translated into dollars. All amounts on the balance sheets have been translated into the USD using the exchange rates in effect on the relevant balance sheet dates. All amounts in the statements of operations have been translated into the USD using the exchange rate on the respective dates on which those elements are recognized. The resulting translation adjustments are reported as a component of accumulated other comprehensive income in shareholders' equity. |
Principles of consolidation | c. Principles of consolidation: The consolidated financial statements include the accounts of the Company and its wholly and majority-owned subsidiaries. Inter-company transactions and balances, including profit from inter-company sales not yet realized outside of the Company, have been eliminated upon consolidation. |
Cash equivalents | d. Cash equivalents: Cash equivalents are short-term highly liquid investments that are readily convertible to cash with original maturities of three months or less at the date acquired. |
Short-term bank deposits | e. Short-term bank deposits: Short-term bank deposits are deposits with original maturities of more than three months but less than one year. Short-term bank deposits are presented at their cost, which approximates their fair value. |
Derivatives | f. Derivatives: ASC 815, Derivative and Hedging, requires companies to recognize all of their derivative instruments as either assets or liabilities in the statement of financial position at fair value. For those derivative instruments that are designated and qualify as hedging instruments, a company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, cash flow hedge or a hedge of a net investment in a foreign operation. Derivative instruments designated as hedging instruments For derivative instruments that are designated and qualify as a cash flow hedge (i.e., hedging the exposure to variability in expected future cash flows that is attributable to a particular risk), the effective portion of the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same period during which the hedged transaction affects earnings. The remaining gain or loss on the derivative instrument in excess of the cumulative change in the present value of future cash flows of the hedged item, if any, is recognized in current earnings during the period of change. For derivative instruments not designated as hedging instruments, the gain or loss is recognized in current earnings during the period of change. To hedge against the risk of overall changes in cash flows resulting from foreign currency salary payments during the periods, the Company has instituted a foreign currency cash flow hedging program. The Company hedges portions of its forecasted salary expenses denominated in NIS. These forward contracts are designated as cash flow hedges, as defined by ASC 815, and are all effective, as their critical terms match the underlying transactions being hedged. As of December 31, 2015 and 2014, the unrealized gain (loss) recorded in accumulated other comprehensive income from the Company's currency forward NIS transactions were $ 20 ($1,334) At December 31, 2015 and 2014, the notional amounts of foreign exchange forward contracts which the Company entered into were $ 749 12,925 respectively Derivative instruments not designated as hedging instruments In addition to the derivatives that are designated as hedges as discussed above, the Company enters into certain foreign exchange forward and options contracts to limit its exposure to foreign currencies. Gains and losses related to such derivative instruments are recorded in financial expenses, net. At December 31, 2015 and 2014, the notional amount of foreign exchange forward and option contracts into which the Company entered was $ 186,217 86,639 The following tables present fair value amounts of, and gains and losses recorded in relation to, the Company's derivative instruments and related hedged items: Balance Sheet Fair Value of Derivative Instruments Year ended December 31, 2015 2014 Derivative Assets: Derivatives not designated as hedging instruments: Foreign exchange option and forward contracts Other accounts receivable and prepaid expenses $ 2,040 $ 2,479 Derivatives designated as hedging instruments: Foreign exchange forward contracts Other accounts receivable and prepaid expenses $ 20 $ - Total $ 2,060 $ 2,479 Derivative Liabilities Derivatives not designated as hedging instruments: Foreign exchange option and forward contracts Other accounts payable and accrued expenses $ (1,421 ) (1,453 ) Derivatives designated as hedging instruments: Foreign exchange forward contracts Other accounts payable and accrued expenses $ - $ (1,447 ) Total $ (1,421 ) $ (2,900 ) Gain (loss) Recognized in Other Comprehensive Income, net Gain (loss) Recognized in Statements of Operations Year ended December 31, Statements of Year ended December 31, 2015 2014 Item 2015 2014 Derivatives designated as hedging instruments Foreign exchange forward contract $ 20 $ (1,334 ) Operating expenses $ (1,364 ) $ (834 ) Derivatives not designated as hedging instruments: Foreign exchange forward and options contracts - - Financial expenses, net 3,242 (153 ) Total $ 20 $ (1,334 ) $ 1,878 $ (987 ) |
Inventories | g. Inventories: Inventories are stated at the lower of cost or market value. The Company periodically evaluates the quantities on hand relative to historical and projected sales volumes, current and historical selling prices and contractual obligations to maintain certain levels of parts. Based on these evaluations, inventory write-offs are provided to cover risks arising from slow-moving items, discontinued products, excess inventories, market prices lower than cost and adjusted revenue forecasts. Cost is determined as follows: Raw Materials - Cost is determined on a standard cost basis which approximates actual costs on a weighted average basis. Work-in-progress and finished products - are based on standard cost (which approximates actual cost on a weighted average basis) which includes raw materials cost, labor and manufacturing overhead. Finished goods are stated at the lower of cost or market. The following table provides the details of the change in the Company's provision for inventory: December 31, 2015 2014 Inventory provision, beginning of year $ 7,724 $ 6,268 Increase in inventory provision 1,708 1,707 Write off (447 ) (251 ) Inventory provision, end of year $ 8,985 $ 7,724 |
Property, plant and equipment, net | h. Property, plant and equipment, net: 1. Property, plant and equipment are stated at cost, net of accumulated depreciation and investment grants. 2. Costs recorded prior to a production line completion are reflected as construction in progress, which are recorded to land, building and machinery assets at the date of purchase. Construction in progress includes direct expenditures for the construction of the production line and is stated at cost. Capitalized costs include costs incurred under the construction contract: advisory, consulting and direct internal costs (including labor) and operating costs incurred during the construction and installation phase. 3. Depreciation is calculated by the straight-line method over the estimated useful life of the assets at the following annual rates: % Machinery and manufacturing equipment 4 33 Office equipment and furniture 7 33 Motor vehicles 10 30 Buildings 4 5 Leasehold improvments Over the shorter of the term of the lease or the life of the asset The Company has accounted for its assets that are under a capital lease arrangement in accordance with Accounting Standard Codification 840 "Leases" ("ASC 840"). Accordingly, assets under a capital lease are stated as assets of the Company on the basis of ordinary purchase prices (without the financing component), and depreciated according to the shorter of the lease term and the usual depreciation rates applicable to such assets. Lease payments payable in forthcoming years, net of the interest component included in them, are included in liabilities. The interest in respect of such amounts is accrued on a current basis and is charged to earnings. |
Impairment of long-lived assets | i. Impairment of long-lived assets: The Company's long-lived assets, tangible and finite-lived intangible assets (other than goodwill), are reviewed for impairment in accordance with Accounting Standard Codification 360 "Property, Plant and Equipment" ("ASC 360") whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. No impairment losses were identified during any period presented. |
Goodwill and other intangibles assets | j. Goodwill and other intangibles assets: Goodwill represents the excess of the cost of businesses acquired over the fair value of the net assets acquired in the acquisition. Under Accounting Standard Codification 350, "Intangibles-Goodwill and Other" ("ASC 350") goodwill is not amortized but instead is tested for impairment at least annually (or more frequently if impairment indicators arise). In the evaluation of goodwill for impairment, the Company has the option to perform a qualitative assessment to determine whether further impairment testing is necessary or to perform a quantitative assessment by comparing the fair value of a reporting unit to its carrying amount, including goodwill. Under the qualitative assessment, an entity is not required to calculate the fair value of a reporting unit unless the entity determines that it is more likely than not that its fair value is less than its carrying amount. If under the quantitative assessment the fair value of a reporting unit is less than its carrying amount, then the amount of the impairment loss, if any, must be measured under step two of the impairment analysis. In the first phase of impairment testing, goodwill attributable to the reporting units is tested for impairment by comparing the fair value of each reporting unit with its carrying value. If the carrying value of the reporting unit exceeds its fair value, the second phase is then performed. The Company performs an annual goodwill impairment test during the fourth quarter of each fiscal year, or more frequently, if impairment indicators are present. The Company Goodwill was tested for impairment by comparing its fair value with its carrying value. As required by ASC 820, "Fair Value Measurements", the Company applies assumptions that market place participants would consider in determining the fair value of reporting unit. No impairment of goodwill was identified during any period presented. Acquired intangible assets other than goodwill are amortized over their weighted average amortization period unless they are determined to be indefinite. Acquired intangible assets are carried at cost, less accumulated amortization. For intangible assets purchased in a business combination, the estimated fair values of the assets received are used to establish the carrying value. The fair value of acquired intangible assets is determined using common techniques, and the Company employs assumptions developed using the perspective of a market participant. |
Warranty | k. Warranty : The Company generally provides a standard warranty of between three ten The following table provides the details of the change in the Company's warranty accrual: 2015 2014 January 1, $ 2,620 $ 2,624 Charged to costs and expenses relating to new sales 1,091 1,154 Costs of product warranty claims (1,195 ) (989 ) Foreign currency translation adjustments (343 ) (169 ) December 31, $ 2,173 $ 2,620 |
Revenue recognition | l. Revenue recognition: The Company derives its revenues from sales of quartz surfaces mostly through a combination of direct sales in certain markets and indirectly through a network of distributors in other markets. Revenues are recognized in accordance with ASC 605, "Revenue Recognition" when delivery has occurred, persuasive evidence of an agreement exists, the fee is fixed and determinable, collectability is probable and no further obligations exist. All of the Company's products that are sold through agreements with exclusive distributors are non-exchangeable, non-refundable, non-returnable and without any rights of price protection or stock rotation. Accordingly, the Company considers all the distributors to be end-consumers. |
Research and development costs | m. Research and development costs: Research and development costs are charged to the statement of income as incurred. |
Income taxes | n. Income taxes: The Company and its subsidiaries account for income taxes in accordance with ASC 740, "Income Taxes". This statement prescribes the use of the liability method whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Deferred tax liabilities and assets are classified as current or noncurrent based on the classification of the related asset or liability for financial reporting purposes, or according to the expected reversal dates of the specific temporary differences if not related to an asset or liability for financial reporting. The Company accounts for its uncertain tax positions in accordance with ASC 740-10. ASC 740-10 contains a two-step approach to recognizing and measuring uncertain tax positions accounted for in accordance with ASC 740. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company accrues interest and penalties related to unrecognized tax benefits in its tax expenses. |
Advertising expenses | o. Advertising expenses: Advertising costs are expensed as incurred. Advertising expenses for the years ended December 31, 2015, 2014 and 2013 were $ 22,380 18,557 16,589 |
Concentrations of credit risk | p. Concentrations of credit risk: Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents, short-term bank deposits and trade receivables. The Company's cash and cash equivalents are invested primarily in U.S. dollars, mainly with major banks in Israel. The Company's trade receivables are derived from sales to customers located mainly in the United States, Australia, Canada, Europe and Israel. The Company performs ongoing credit evaluations of its customers and to date has not experienced any substantial losses. In certain circumstances, the Company requires letters of credit or prepayments. An allowance for doubtful accounts is provided with respect to specific receivables that the Company has determined to be doubtful of collection. For those receivables not specifically reviewed, provisions are recorded at a specific rate, based upon the age of the receivable, the collection history, current economic trends and management estimates. December 31, 2015, 2014 and 2013 The following table provides the detail of the change in the Company's provision for doubtful debts: 2015 2014 January 1, $ 2,225 $ 1,898 Charges to expenses (340 ) 974 Write offs (524 ) (544 ) Foreign currency translation adjustments (140 ) (103 ) December 31, $ 1,221 $ 2,225 |
Severance pay | q. Severance pay: The Company's liability for severance pay, with respect to its Israeli employees, is calculated pursuant to Israeli severance pay law and employee agreements based on the most recent salary of the employees. The Company's liability for all of its Israeli employees is provided for by monthly deposits with insurance policies and by an accrual. The value of these policies is recorded as an asset on the Company's balance sheet. The deposited funds include profits or losses accumulated up to the balance sheet date. The deposited funds may be withdrawn only upon the fulfillment of the obligations pursuant to Israeli severance pay law or labor agreements. Some agreements with employees specifically state, in accordance with section 14 of the Severance Pay Law, 1963, that the Company's contributions for severance pay shall be instead of severance compensation and that upon release of the policy to the employee, no additional calculations shall be conducted between the parties regarding the matter of severance pay and no additional payments shall be made by the Company to the employee. Further, since the Company has signed agreements with its employees under section 14, the related obligation and amounts deposited on behalf of such obligation are not stated on the balance sheet, as they are legally released from obligation to employees once the deposit amounts have been paid. Severance pay expenses for the years ended December 31, 2015, 2014 and 2013 amounted to approximately $ 499 455 456 |
Fair value of financial instruments | r. Fair value of financial instruments: Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the "exit price") in an orderly transaction between market participants at the measurement date. In determining fair value, the Company uses various valuation approaches. ASC 820 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the inputs as follows: Level 1- Quoted prices in active markets for identical assets or liabilities. Level 2- Valuations based on one or more quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Level 3- Valuations based on inputs that are unobservable and significant to the overall fair value measurement. Foreign currency derivative contracts are classified within Level 2 as the valuation inputs are based on quoted prices and market observable data of similar instruments. The following table presents the Company's assets and (liabilities) measured at fair value on a recurring basis at December 31, 2015 and 2014: December 31, 2015 Level 1 Level 2 Level 3 Total Derivatives: Foreign currencies derivative assets $ - $ 2,060 $ - $ 2,060 Foreign currencies derivative liabilities $ - $ (1,421 ) $ - $ (1,421 ) Total $ - $ 639 $ - $ 639 December 31, 2014 Level 1 Level 2 Level 3 Total Derivatives: Foreign currencies derivative assets $ - $ 2,479 $ - $ 2,479 Foreign currencies derivative liabilities $ - $ (2,900 ) $ - $ (2,900 ) Total $ - $ (421 ) $ - $ (421 ) The carrying amounts of financial instruments not measured at fair value, including cash and cash equivalents, short-term bank deposits, trade receivables, trade payables and short term loans, approximate their fair value due to the short-term maturities of such instruments. The carrying amount of long-term loans approximates their fair value. |
Basic and diluted net income per share | s. Basic and diluted net income per share: Basic net income per share ("Basic EPS") is computed by dividing net income attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted net income per share ("Diluted EPS") gives effect to all dilutive potential ordinary shares outstanding during the period. The computation of Diluted EPS does not assume conversion, exercise or contingent exercise of securities that would have an anti-dilutive effect on earnings. The dilutive effect of outstanding stock options is computed using the treasury stock method. For the year ended December 31, 2015 there were 786,900 outstanding stock options that were excluded from the computation of Diluted EPS, that would have had an anti dilutive effect if included. For the years ended December 31, 2014 and 2013 no outstanding options were excluded from the computation of Diluted EPS. |
Comprehensive income and accumulated other comprehensive income | t. Comprehensive income and accumulated other comprehensive income: Comprehensive income consists of two components, net income and other comprehensice income ("OCI"). OCI refers to revenue, expenses, and gains and losses that under U.S. December 31, 2015 2014 Accumulated losses on derivative instruments $ 20 $ (1,334 ) Accumulated foreign currency translation differences (1,912 ) 800 Total accumulated other comprehensive income, net $ (1,892 ) $ (534 ) The following table summarizes the changes in AOCI, net of taxes for the year ended: Unrealized Accumulated Total Balance at December 31, 2013 $ - $ 3,680 $ 3,680 Other comprehensive income (loss) before reclassifications (2,168 ) (2,880 ) (5,048 ) Amounts reclassified from AOCI 834 - 834 Net current period OCI (1,334 ) (2,880 ) (4,214 ) Balance at December 31, 2014 $ (1,334 ) $ 800 $ (534 ) Other comprehensive income (loss) before reclassifications (10 ) (2,712 ) (2,722 ) Amounts reclassified from AOCI 1,364 - 1,364 Net current period OCI 1,354 (2,712 ) (1,358 ) Balance at December 31, 2015 $ 20 $ (1,912 ) $ (1,892 ) The following table shows the amounts reclassified from AOCI into the Consolidated Statements of Operations, and the associated financial statement line item, for 2015 and 2014: Affected line item in the consolidated statement of income 2015 2014 Cost of revenues $ 1,105 $ 692 Research and development 27 17 Marketing and selling 109 67 General and administrative 123 58 $ 1,364 $ 834 |
Accounting for stock-based compensation | u. Accounting for stock-based compensation: 1. The Company accounts for stock-based compensation in accordance with ASC 718, "Compensation-Stock Compensation" ("ASC 718"). ASC 718 requires companies to estimate the fair value of equity-based payment awards on the date of grant using an option-pricing model. The Company accounts for employees' share-based payment awards classified as equity awards using the grant-date fair value method. The fair value of share-based payment transactions is recognized as an expense over the requisite service period, net of estimated forfeitures. The Company estimates forfeitures based on historical experience and anticipated future conditions. The Company elected to recognize compensation expense for an award that has a graded vesting schedule using the accelerated method. The exercise price of each option is generally the fair market value on the date of the grant. Options generally become exercisable over approximately three four 7 four In 2015, the Company estimated the fair value of stock options granted using the Black-Scholes option pricing model with the following 2015 Dividend yield 0 % Expected volatility 41.1 % Risk-free interest rate 1.2 % Expected life (in years) 3.98 The Company used volatility data of comparable companies with similar characteristics to the Company for calculating volatility in accordance with ASC 718. The computation of historical volatility was derived from the comparable companies' historical volatility for similar contractual terms. The computation of risk free interest rate is based on the rate available on the date of grant of a zero-coupon U.S. government bond with a remaining term equal to the expected term of the option. The expected term of options granted is calculated using the simplified method (being the average between the vesting periods and the contractual life of the options). The Company currently uses the simplified method as adequate historical experience is not available to provide a reasonable estimate. The dividend yield is zero, due to a dividend adjustment mechanism with respect to the exercise price upon payment of a dividend. 2. Phantom share based payment: During 2014, the Company granted several of its employees a right to a bonus payment based on an increase in the Company's share value (the "phantom award") under which the employees are entitled to receive in cash or shares the difference between exercise price, subject to adjustments for dividend distributions made until the actual payment of the bonus and the value of the Company's ordinary shares with such bonus right vesting over a four According to ASC 718-10, instruments that are required to be cash-settled (e.g., cash-settled stock appreciation rights) or require cash settlement on the occurrence of a contingent event that is considered probable should be treated as a liability. As such, in this case the share-based compensation is accounted for as a liability award. According to ASC 718-10, in connection with the measurement of the liability settlement, the value of the award should be measured each reporting date until settlement. The fair value of the phantom award was calculated using the Binominal option pricing model. On October 27, 2015, the Company's board of directors approved the grant of stock options and RSUs as a partial replacement for the phantom awards previously granted during 2014. A change in the terms or conditions of the phantom awards is accounted for as a modification under ASC 718. On the date of modification, the amounts previously recorded as a share-based compensation liability are reclassified and recorded as a component of equity by a credit to additional paid-in capital. The Company reclassified $ 195 The Company estimated the fair value of the remaining phantom awards, using the binominal option pricing model with the following weighted average assumptions: December 31, 2015 2014 Dividend yield 0 % 0 % Expected volatility 39.2 % 45.0 % Risk-free interest rate 1.8 % 1.9 % Expected life (in years) 5.2 6.3 As of December 31, 2015 and 2014, the Phantom liability balance was $ 538 1,555 52 |
Redeemable non-controlling interest | v. Redeemable non-controlling interest: The Company is party to a put and call arrangement with respect to the remaining 45 The following table provides a reconciliation of the redeemable non-controlling interest: December 31, 2015 2014 2013 Beginning of the year $ 8,715 $ 7,624 $ 7,106 Net income attributable to non-controlling interest 1,692 1,820 1,009 Foreign currency translation adjustments (1,566 ) (729 ) (491 ) Redeemable non-controlling interest - end of the year $ 8,841 $ 8,715 $ 7,624 |
Capitalized software costs | w. Capitalized software costs: The Company follows the accounting guidance specified in ASC 350-40, Internal-Use Software. The Company capitalizes costs incurred in the acquisition or development of software for internal use, including the costs of the software, materials, and consultants incurred in developing internal-use computer software, once final selection of the software is made. Costs incurred prior to the final selection of software and costs not qualifying for capitalization are charged to expense. Capitalized software costs are amortized on a straight-line basis over it's useful life. |
Contingencies | x. Contingencies: The Company is involved in various product liability, commercial, government investigations, environmental claims and other legal proceedings that arise from time to time in the course of business. The Company records accruals for these types of contingencies to the extent that the Company concludes their occurrence is probable and that the related liabilities are estimable. When accruing these costs, the Company will recognize an accrual in the amount within a range of loss that is the best estimate within the range. When no amount within the range is a better estimate than any other amount, the Company accrues for the minimum amount within the range. The Company records anticipated recoveries under existing insurance contracts that are probable of occurring at the amount that is expected to be collected. Legal costs are expensed as incurred. |
Impact of recently issued accounting standards | y. Impact of recently issued accounting standards 1. In May 2014, the FASB issued ASU No. 2014-09 related to revenue recognition. This new standard will replace all current GAAP guidance on this topic and eliminate all industry-specific guidance. The new revenue recognition guidance provides a unified model to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. This guidance can be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. In 2015, the FASB issued guidance to defer the effective date to fiscal years beginning after December 15, 2017 with early adoption for fiscal years beginning December 15, 2016. The Company is evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. 2. In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330), Simplifying the Measurement of Inventory. Under this ASU, the measurement principle for inventory will change from lower of cost or market value to lower of cost and net realizable value. The ASU defines net realizable value as the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The ASU is applicable to inventory that is accounted for under the first-in, first-out method and is effective for reporting periods after December 15, 2016, with early adoption permitted. The Company is evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. 3. In November 2015, the FASB issued ASU No. 2015-17 4. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) that will supersede current guidance related to accounting for leases. The guidance is intended to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The standard will be effective for the first interim period within annual periods beginning after December 15, 2018, with early adoption permitted. The standard is required to be adopted using the modified retrospective approach. The Company is evaluating the impact that adopting this guidance will have on its consolidated financial statements. |
SIGNIFICANT ACCOUNTING POLICI25
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Fair Value Amounts and Gains and Losses Recorded in Relation to the Derivative Instruments | Balance Sheet Fair Value of Derivative Instruments Year ended December 31, 2015 2014 Derivative Assets: Derivatives not designated as hedging instruments: Foreign exchange option and forward contracts Other accounts receivable and prepaid expenses $ 2,040 $ 2,479 Derivatives designated as hedging instruments: Foreign exchange forward contracts Other accounts receivable and prepaid expenses $ 20 $ - Total $ 2,060 $ 2,479 Derivative Liabilities Derivatives not designated as hedging instruments: Foreign exchange option and forward contracts Other accounts payable and accrued expenses $ (1,421 ) (1,453 ) Derivatives designated as hedging instruments: Foreign exchange forward contracts Other accounts payable and accrued expenses $ - $ (1,447 ) Total $ (1,421 ) $ (2,900 ) Gain (loss) Recognized in Other Comprehensive Income, net Gain (loss) Recognized in Statements of Operations Year ended December 31, Statements of Year ended December 31, 2015 2014 Item 2015 2014 Derivatives designated as hedging instruments Foreign exchange forward contract $ 20 $ (1,334 ) Operating expenses $ (1,364 ) $ (834 ) Derivatives not designated as hedging instruments: Foreign exchange forward and options contracts - - Financial expenses, net 3,242 (153 ) Total $ 20 $ (1,334 ) $ 1,878 $ (987 ) |
Schedule of Change in Provision for Inventory | December 31, 2015 2014 Inventory provision, beginning of year $ 7,724 $ 6,268 Increase in inventory provision 1,708 1,707 Write off (447 ) (251 ) Inventory provision, end of year $ 8,985 $ 7,724 |
Schedule of Property, Plant and Equipment Depreciation Rates | % Machinery and manufacturing equipment 4 33 Office equipment and furniture 7 33 Motor vehicles 10 30 Buildings 4 5 Leasehold improvments Over the shorter of the term of the lease or the life of the asset |
Schedule of Changes in Warranty Accrual | 2015 2014 January 1, $ 2,620 $ 2,624 Charged to costs and expenses relating to new sales 1,091 1,154 Costs of product warranty claims (1,195 ) (989 ) Foreign currency translation adjustments (343 ) (169 ) December 31, $ 2,173 $ 2,620 |
Schedule of Change in Provision for Doubtful Debts | 2015 2014 January 1, $ 2,225 $ 1,898 Charges to expenses (340 ) 974 Write offs (524 ) (544 ) Foreign currency translation adjustments (140 ) (103 ) December 31, $ 1,221 $ 2,225 |
Schedule of Assets and Liabilities Measured at Fair Value | December 31, 2015 Level 1 Level 2 Level 3 Total Derivatives: Foreign currencies derivative assets $ - $ 2,060 $ - $ 2,060 Foreign currencies derivative liabilities $ - $ (1,421 ) $ - $ (1,421 ) Total $ - $ 639 $ - $ 639 December 31, 2014 Level 1 Level 2 Level 3 Total Derivatives: Foreign currencies derivative assets $ - $ 2,479 $ - $ 2,479 Foreign currencies derivative liabilities $ - $ (2,900 ) $ - $ (2,900 ) Total $ - $ (421 ) $ - $ (421 ) |
Schedule of Accumulated Other Comprehensive Income, Net | December 31, 2015 2014 Accumulated losses on derivative instruments $ 20 $ (1,334 ) Accumulated foreign currency translation differences (1,912 ) 800 Total accumulated other comprehensive income, net $ (1,892 ) $ (534 ) |
Schedule of Changes in Accumulated Balances of Other Comprehensive Income | Unrealized Accumulated Total Balance at December 31, 2013 $ - $ 3,680 $ 3,680 Other comprehensive income (loss) before reclassifications (2,168 ) (2,880 ) (5,048 ) Amounts reclassified from AOCI 834 - 834 Net current period OCI (1,334 ) (2,880 ) (4,214 ) Balance at December 31, 2014 $ (1,334 ) $ 800 $ (534 ) Other comprehensive income (loss) before reclassifications (10 ) (2,712 ) (2,722 ) Amounts reclassified from AOCI 1,364 - 1,364 Net current period OCI 1,354 (2,712 ) (1,358 ) Balance at December 31, 2015 $ 20 $ (1,912 ) $ (1,892 ) |
Schedule of Losses on Cash Flow Hedge Reclassified Out of Accumulated Other Comprehensive Income | Affected line item in the consolidated statement of income 2015 2014 Cost of revenues $ 1,105 $ 692 Research and development 27 17 Marketing and selling 109 67 General and administrative 123 58 $ 1,364 $ 834 |
Reconciliation of Redeemable Non-controlling Interest | December 31, 2015 2014 2013 Beginning of the year $ 8,715 $ 7,624 $ 7,106 Net income attributable to non-controlling interest 1,692 1,820 1,009 Foreign currency translation adjustments (1,566 ) (729 ) (491 ) Redeemable non-controlling interest - end of the year $ 8,841 $ 8,715 $ 7,624 |
Employee Stock Option [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Assumptions Used to Estimate Fair Value | 2015 Dividend yield 0 % Expected volatility 41.1 % Risk-free interest rate 1.2 % Expected life (in years) 3.98 |
Phantom Share Based Payment [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Assumptions Used to Estimate Fair Value | December 31, 2015 2014 Dividend yield 0 % 0 % Expected volatility 39.2 % 45.0 % Risk-free interest rate 1.8 % 1.9 % Expected life (in years) 5.2 6.3 |
OTHER ACCOUNTS RECEIVABLE AND26
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES [Abstract] | |
Schedule of Other Accounts Receivable and Prepaid Expenses | December 31, 2015 2014 Prepaid expenses $ 1,760 $ 2,296 Government authorities 10,459 5,765 Deferred tax assets 11,249 8,384 Advances to suppliers 2,976 2,480 Derivatives 2,060 2,479 Other receivables (see also note 10) 3,726 1,325 $ 32,230 $ 22,729 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
INVENTORIES [Abstract] | |
Schedule of Inventories | December 31, 2015 2014 Raw materials $ 24,218 $ 15,439 Work-in-progress 1,422 726 Finished goods 69,839 64,047 $ 95,479 $ 80,212 |
PROPERTY, PLANT AND EQUIPMENT28
PROPERTY, PLANT AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
PROPERTY, PLANT AND EQUIPMENT, NET [Abstract] | |
Schedule of Property, Plant and Equipment, Net | December 31, 2015 2014 Cost: Machinery and manufacturing equipment, net(1) $ 218,610 $ 173,937 Office equipment and furniture 12,757 8,633 Motor vehicles 855 948 Buildings and leasehold improvements 99,607 77,281 Prepaid expenses related to operating lease(2) 939 939 332,768 261,738 Accumulated depreciation 107,330 88,745 Depreciated cost $ 225,438 $ 172,993 (1) Presented net of investment grants received in 2004, 2005 and 2006 years, in the total amount of $ 7,200 (2) Until 2012, the Company leased land from the Israel Lands Administration ("ILA") for its Bar-Lev manufacturing facility. The lease term started on February 6, 2005. The lease is for an initial non-cancellable term of 49 49 |
OTHER INTANGIBLES ASSETS (Table
OTHER INTANGIBLES ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
OTHER INTANGIBLES ASSETS [Abstract] | |
Schedule of Other Intangible Assets, Net | December 31, 2015 2014 Original amounts: Non-compete agreement $ 1,453 $ 1,672 Distribution relationships 1,594 1,698 Customer relationships 5,910 6,588 Distribution agreement 14,606 14,616 23,563 24,574 Accumulated amortization: Non-compete agreement (1,434 ) (1,646 ) Distribution relationships (1,305 ) (1,311 ) Customer relationships (4,962 ) (4,458 ) Distribution agreement (8,979 ) (7,100 ) (16,680 ) (14,515 ) Total other intangibles assets $ 6,883 $ 10,059 |
Schedule of Estimated Amortization Expenses | 2016 $ 2,338 2017 2,304 2018 2,241 $ 6,883 |
GOODWILL (Tables)
GOODWILL (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
GOODWILL [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill | Balance as of December 31, 2013 $ 39,702 Foreign currency translation adjustments (1,742 ) Balance as of December 31, 2014 $ 37,960 Foreign currency translation adjustments (2,139 ) Balance as of December 31, 2015 $ 35,821 |
SHORT-TERM BANK CREDIT (Tables)
SHORT-TERM BANK CREDIT (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
SHORT-TERM BANK CREDIT [Abstract] | |
Schedule of Short-Term Bank Credit | Weighted average interest Currency December 31, December 31, 2015 2014 2015 2014 % Short-term bank credit CAD 3.04 - $ 3,241 $ - |
ACCRUED EXPENSES AND OTHER LI32
ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
ACCRUED EXPENSES AND OTHER LIABILITIES [Abstract] | |
Schedule of Accrued Expenses and Other Liabilities | December 31, 2015 2014 Employees and payroll accruals $ 10,438 $ 10,582 Accrued expenses 7,138 7,394 Advances from customers 574 42 Taxes payable 2,647 1,915 Warranty provision 1,239 1,475 Derivatives 1,421 2,900 Phantom share based payment 390 750 Legal settlements and loss contingencies (see also note 10) 3,647 - Other 492 716 $ 27,986 $ 25,774 |
COMMITMENTS AND CONTINGENT LI33
COMMITMENTS AND CONTINGENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
COMMITMENTS AND CONTINGENT LIABILITIES [Abstract] | |
Summary of Cumulative Product claims Activity | 2015 2014 2013 Open claims, January 1 54 27 20 New claims 19 28 8 Settled and dismissed claims (2 ) (1 ) (1) Open claims, December 31 71 54 27 |
Schedule of Future Minimum Lease Commitments | 2016 $ 13,075 2017 11,698 2018 10,040 2019 8,593 2020 6,617 2021 and thereafter 46,266 Total $ 96,289 |
Schedule of Significant Contractual Obligations and Commitments | 2016 (1) $ 3,808 2017 and thereafter - $ 3,808 (1) Consists of purchase obligations to certain suppliers. |
TAXES ON INCOME (Tables)
TAXES ON INCOME (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
TAXES ON INCOME [Abstract] | |
Schedule of Deferred Income Taxes | December 31, 2015 2014 Deferred tax assets (liability): Intangible assets $ - $ 110 Other temporary differences (1) 6,349 5,636 Temporary differences related to inventory 1,755 637 Phantom award 21 53 Unrealized profit from sales to subsidiary 4,944 3,355 Less-valuation allowance (310 ) (331 ) Total net deferred tax assets 12,759 9,460 Deferred tax liabilities Property and equipment (13,734 ) (3,081 ) Intangible assets (2,486 ) (2,910 ) Other temporary differences (141 ) (20 ) Total deferred tax liabilities (16,361 ) (6,011 ) Deferred tax assets (liability), net $ (3,602) $ 3,449 |
Reconciliation of Effective Tax Rate to Statutory Tax Rate | Year ended December 31, 2015 2014 2013 Income before taxes on income $ 93,301 $ 93,997 $ 74,689 Statutory tax rate in Israel 26.5 % 26.5 % 25 % Income taxes at statutory rate $ 24,725 $ 24,909 $ 18,672 Increase (decrease) in tax expenses resulting from: Tax benefit arising from reduced rate as an "Approved Enterprise" (13,232 ) (12,482 ) (11,267 ) Non-deductible expenses, net 1,073 856 1,274 Adjustment for change in tax law - - 575 Decrease in taxes resulting from tax settlement with tax authorities (513 ) (286 ) - Tax adjustment in respect of foreign subsidiaries' different tax rates 693 634 741 Uncertain tax position 1,034 146 219 Changes in valuation allowance (21 ) (66 ) 97 Others 84 27 25 Income tax expense $ 13,843 $ 13,738 $ 10,336 Effective tax rate 15 % 15 % 14 % Per share amounts (basic) of the tax benefit resulting from an "Approved Enterprise" $ (0.38 ) $ (0.36 ) $ (0.32 ) Per share amounts (diluted) of the tax benefit resulting from an "Approved Enterprise" $ (0.37 ) $ (0.35 ) $ (0.32 ) |
Schedule of Income before Taxes on Income | Year ended December 31, 2015 2014 2013 Domestic $ 81,020 $ 82,670 $ 65,657 Foreign 12,281 11,327 9,032 $ 93,301 $ 93,997 $ 74,689 |
Schedule of Tax Expenses on Income | Year ended December 31, 2015 2014 2013 Current taxes $ 6,792 $ 16,318 $ 10,119 Deferred taxes 7,051 (2,580 ) 217 $ 13,843 $ 13,738 $ 10,336 Domestic $ 9,892 $ 9,646 $ 6,395 Foreign 3,951 4,092 3,941 $ 13,843 $ 13,738 $ 10,336 |
Reconciliation of Beginning and Ending Balances of Unrecognized Tax Benefits | Gross tax liabilities at January 1, 2013 $ 1,084 Increases in tax positions for current year 151 Addition of tax position of prior years 68 Foreign currency adjustments 92 Gross tax liabilities at December 31, 2013 1,395 Increases in tax positions for current year 146 Addition of tax position of prior years (1,076 ) Foreign currency adjustments (48 ) Gross tax liabilities at December 31, 2014 417 Increases in tax positions for current year 493 Addition of tax position of prior years 541 Foreign currency adjustments (9 ) Gross tax liabilities at December 31, 2015 $ 1,442 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
SHAREHOLDERS' EQUITY [Abstract] | |
Schedule of Share Capital | Authorized Issued and outstanding December 31, December 31, 2015 2014 2015 2014 Shares of NIS 0.04 Ordinary shares 200,000,000 200,000,000 35,294,755 35,132,127 |
Summary of Stock Option Activity | Number of options Weighted average exercise price Aggregate intrinsic Outstanding - beginning of the year 401,295 $ 10.09 Granted 784,000 $ 37.92 Exercised (193,029 ) $ 9.85 Forfeited (6,781 ) $ 9.85 Outstanding - end of the year 985,485 $ 32.28 $ 10,899 Options exercisable at the end of the year 103,747 $ 37.66 $ 589 Vested and expected to vest 985,485 $ 32.28 $ 10,899 |
Summary of Activities Relating to Company's RSUs Granted to Employees | Number of RSUs Weighted average fair value Aggregate intrinsic value Outstanding - beginning of the year - $ - Granted 55,100 $ 35.04 Exercised - $ - Forfeited - $ - Outstanding - end of the year 55,100 $ 35.04 $ 2,387 RSUs exercisable at the end of the year - $ - $ - Vested and expected to vest 55,100 $ 35.04 $ 2,387 |
Schedule of Awards Outstanding | Awards outstanding Awards exercisable Exercise price Number of options Weighted average remaining contractual life (years) Weighted average exercise price per share Number of options Weighted average remaining contractual life (years) Weighted average exercise price $ 0.01 (RSUs) 55,100 6.83 $ 0.01 - - - $ 9.85 181,485 3.22 $ 9.85 3,747 3.22 9.85 $ 14.69 20,000 3.84 $ 14.69 10,000 3.84 14.69 $ 34.60 404,000 6.82 $ 34.60 - - - $ 41.37 42.96 380,000 6.73 $ 41.45 90,000 6.71 41.37 1,040,585 103,747 |
Schedule of Compensation Expenses | December 31, 2015 2014 Cost of revenues $ 121 $ 75 Research 96 52 Selling and marketing expenses 259 210 General and administrative expenses 2,131 875 Total $ 2,607 $ 1,212 |
TRANSACTIONS WITH RELATED PAR36
TRANSACTIONS WITH RELATED PARTIES AND OTHER LOAN (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
TRANSACTIONS WITH RELATED PARTIES AND OTHER LOAN [Abstract] | |
Schedule of Maturity of Debt Obligations | 2016 $ 521 2017 554 2018 588 2019 624 2020 663 2021 and thereafter 6,697 $ 9,647 |
Schedule of Transactions and Balances with Related Party and Other Loan | Year ended December 31, 2015 2014 2013 Cost of revenues $ 7,638 $ 9,073 $ 8,792 Research and development $ 180 $ 123 $ 211 Selling and marketing $ 691 $ 373 $ 632 General and administrative $ 1,828 $ 2,538 $ 1,649 Finance expenses, net $ 597 $ 685 $ 671 December 31, 2015 2014 Related party and other loan (1,2) $ 3,251 $ 3,975 Long-term loan and financing leaseback from a related party (2) $ 8,472 $ 8,993 (1) On January 17, 2011 a loan of 4 0.25 (2) In September, 2012, a financing leaseback of $ 10.9 6.19 |
MAJOR CUSTOMER AND GEOGRAPHIC37
MAJOR CUSTOMER AND GEOGRAPHIC INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
MAJOR CUSTOMER AND GEOGRAPHIC INFORMATION [Abstract] | |
Schedule of Revenues | Year ended December 31, 2015 2014 2013 USA $ 223,341 $ 185,583 $ 123,399 Australia 110,290 107,539 89,894 Canada 70,739 57,898 49,214 Israel 39,645 41,286 42,024 Europe 23,949 23,109 22,973 Rest of World 31,551 31,987 29,050 $ 499,515 $ 447,402 $ 356,554 |
Schedule of Long-Lived Assets | December 31, 2015 2014 Israel $ 88,658 $ 93,976 Australia 1,657 1,857 USA 133,481 75,873 Canada 1,548 1,144 Rest of World 94 143 $ 225,438 $ 172,993 |
SELECTED SUPPLEMENTARY STATEM38
SELECTED SUPPLEMENTARY STATEMENTS OF INCOME DATA (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
SELECTED SUPPLEMENTARY STATEMENTS OF INCOME DATA [Abstract] | |
Schedule of Financial and Other Income (Expenses), Net | Year ended December 31, 2015 2014 2013 Finance expenses: Interest in respect of long-term loans $ - $ - $ 53 Interest in respect of short-term loans and bank fees 2,792 3,038 1,565 Interest in respect of loans to related parties 640 732 729 Changes in derivatives fair value - 2,710 - Foreign exchange transactions losses 2,972 - 6,107 6,404 6,480 8,454 Finance income: Changes in derivatives fair value 1,060 - 6,485 Income in respect of cash and cash equivalent and short-term bank deposits 77 403 655 Foreign exchange transactions gains 2,182 5,032 - 3,319 5,435 7,140 Finance expenses, net $ 3,085 $ 1,045 $ 1,314 |
Computation of Basic and Diluted Net Earnings Per Share | Numerator : Year ended December 31, 2015 2014 2013 Net income attributable to controlling interest, as reported $ 77,766 $ 78,439 $ 63,344 Numerator for basic and diluted net income per share $ 77,766 $ 78,439 $ 63,344 Denominator: Year ended December 31, 2015 2014 2013 Denominator for basic income per share 35,252,596 34,932,000 34,666,514 Effect of dilutive stock based awards 211,102 462,499 543,432 Denominator for diluted income per share 35,463,698 35,394,499 35,209,946 Earnings Per Share Year ended 2015 2014 2013 Basic earnings per share $ 2.21 $ 2.25 $ 1.83 Diluted earnings per share $ 2.19 $ 2.22 $ 1.80 |
GENERAL (Acquisition of the bus
GENERAL (Acquisition of the business of Prema Asia Marketing PTE Ltd. ("Prema")) (Details) - Prema Asia Marketing PTE Ltd. [Member] - USD ($) $ in Thousands | Oct. 01, 2011 | Dec. 31, 2014 | Dec. 31, 2012 | Dec. 31, 2011 |
Business Acquisition [Line Items] | ||||
Cash paid for acquisition | $ 500 | $ 150 | $ 150 | |
Maximum contingent payment | $ 300 |
GENERAL (Major suppliers) (Deta
GENERAL (Major suppliers) (Details) | 12 Months Ended |
Dec. 31, 2015countries | |
GENERAL [Abstract] | |
Number of countries in which entity sells products | 50 |
Cost of Goods, Total [Member] | Supplier Concentration Risk [Member] | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 71.00% |
Cost of Goods, Total [Member] | Supplier Concentration Risk [Member] | Mikroman [Member] | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 41.00% |
Concentration Percentage of Total Inventory | 29.00% |
Cost of Goods, Total [Member] | Supplier Concentration Risk [Member] | Polat [Member] | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 36.00% |
Concentration Percentage of Total Inventory | 25.00% |
SIGNIFICANT ACCOUNTING POLICI41
SIGNIFICANT ACCOUNTING POLICIES (Derivatives) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Derivatives, Fair Value [Line Items] | ||
Unrealized gain (loss) recorded in accumulated other comprehensive income | $ 20 | $ (1,334) |
Derivative Assets | 2,060 | 2,479 |
Derivative Liabilities | (1,421) | (2,900) |
Gain (loss) Recognized in Other Comprehensive Income, net | 20 | (1,334) |
Gain (loss) Recognized in Statements of Operations | 1,878 | (987) |
Foreign Exchange Forward Contracts [Member] | Designated As Hedging [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount | 749 | 12,925 |
Gain (loss) Recognized in Other Comprehensive Income, net | 20 | (1,334) |
Foreign Exchange Forward Contracts [Member] | Designated As Hedging [Member] | Operating Expenses [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Gain (loss) Recognized in Statements of Operations | (1,364) | $ (834) |
Foreign Exchange Forward Contracts [Member] | Designated As Hedging [Member] | Other Accounts Receivable and Prepaid Expenses [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | $ 20 | |
Foreign Exchange Forward Contracts [Member] | Designated As Hedging [Member] | Other Accounts Payable and Accrued Expenses [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | $ (1,447) | |
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount | $ 186,217 | $ 86,639 |
Gain (loss) Recognized in Other Comprehensive Income, net | ||
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member] | Financial expenses, net [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Gain (loss) Recognized in Statements of Operations | $ 3,242 | $ (153) |
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member] | Other Accounts Receivable and Prepaid Expenses [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 2,040 | 2,479 |
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member] | Other Accounts Payable and Accrued Expenses [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | $ (1,421) | $ (1,453) |
SIGNIFICANT ACCOUNTING POLICI42
SIGNIFICANT ACCOUNTING POLICIES (Inventories) (Details) - Inventory Valuation Reserve [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Valuation and Qualifying Accounts Disclosure [Line Items] | ||
Balance at the beginning of the year | $ 7,724 | $ 6,268 |
Increase in inventory provision | 1,708 | 1,707 |
Write off | (447) | (251) |
Balance at end of the year | $ 8,985 | $ 7,724 |
SIGNIFICANT ACCOUNTING POLICI43
SIGNIFICANT ACCOUNTING POLICIES (Property, plant and equipment, net) (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Machinery and Manufacturing Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment, net [Line Items] | |
Rate of depreciation (in percent) | 4.00% |
Machinery and Manufacturing Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment, net [Line Items] | |
Rate of depreciation (in percent) | 33.00% |
Office Equipment and Furniture [Member] | Minimum [Member] | |
Property, Plant and Equipment, net [Line Items] | |
Rate of depreciation (in percent) | 7.00% |
Office Equipment and Furniture [Member] | Maximum [Member] | |
Property, Plant and Equipment, net [Line Items] | |
Rate of depreciation (in percent) | 33.00% |
Motor Vehicles [Member] | Minimum [Member] | |
Property, Plant and Equipment, net [Line Items] | |
Rate of depreciation (in percent) | 10.00% |
Motor Vehicles [Member] | Maximum [Member] | |
Property, Plant and Equipment, net [Line Items] | |
Rate of depreciation (in percent) | 30.00% |
Buildings [Member] | Minimum [Member] | |
Property, Plant and Equipment, net [Line Items] | |
Rate of depreciation (in percent) | 4.00% |
Buildings [Member] | Maximum [Member] | |
Property, Plant and Equipment, net [Line Items] | |
Rate of depreciation (in percent) | 5.00% |
SIGNIFICANT ACCOUNTING POLICI44
SIGNIFICANT ACCOUNTING POLICIES (Warranty) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ||
January 1 | $ 2,620 | $ 2,624 |
Charged to costs and expenses relating to new sales | 1,091 | 1,154 |
Costs of product warranty claims | (1,195) | (989) |
Foreign currency translation adjustments | (343) | (169) |
December 31 | $ 2,173 | $ 2,620 |
Minimum [Member] | ||
Warranty: | ||
Warranty term | 3 years | |
Maximum [Member] | ||
Warranty: | ||
Warranty term | 10 years |
SIGNIFICANT ACCOUNTING POLICI45
SIGNIFICANT ACCOUNTING POLICIES (Other Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Advertising expenses: | |||
Advertising expenses | $ 22,380 | $ 18,557 | $ 16,589 |
Severance pay: | |||
Severance pay expense | $ 499 | $ 455 | $ 456 |
Basic and diluted net income per share: | |||
Anti-dilutive stock options excluded from the calculations of Diluted EPS | 786,900 | 0 | 0 |
SIGNIFICANT ACCOUNTING POLICI46
SIGNIFICANT ACCOUNTING POLICIES (Concentrations of credit risk) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ||
January 1 | $ 2,225 | $ 1,898 |
Charges to expenses | (340) | 974 |
Write offs | (524) | (544) |
Foreign currency translation adjustments | (140) | (103) |
December 31 | $ 1,221 | $ 2,225 |
SIGNIFICANT ACCOUNTING POLICI47
SIGNIFICANT ACCOUNTING POLICIES (Fair value of financial instruments) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign currencies derivatives assets | $ 2,060 | $ 2,479 |
Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign currencies derivatives assets | 2,060 | 2,479 |
Foreign currencies derivatives liabilities | (1,421) | (2,900) |
Total | $ 639 | $ (421) |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign currencies derivatives assets | ||
Foreign currencies derivatives liabilities | ||
Total | ||
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign currencies derivatives assets | $ 2,060 | $ 2,479 |
Foreign currencies derivatives liabilities | (1,421) | (2,900) |
Total | $ 639 | $ (421) |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign currencies derivatives assets | ||
Foreign currencies derivatives liabilities | ||
Total |
SIGNIFICANT ACCOUNTING POLICI48
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Accumulated other comprehensive income, net | $ 400,221 | $ 321,011 | $ 265,599 | $ 223,917 | |
Accumulated Losses on Derivative Instruments [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Accumulated other comprehensive income, net | 20 | (1,334) | |||
Accumulated Foreign Currency Translation Differences [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Accumulated other comprehensive income, net | (1,912) | 800 | $ 3,680 | ||
Accumulated Other Comprehensive Income (Loss), Net [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Accumulated other comprehensive income, net | [1] | $ (1,892) | $ (534) | $ 3,680 | $ 8,517 |
[1] | Accumulated other comprehensive income (loss), net, comprised of foreign currency translation and hedging transactions. |
SIGNIFICANT ACCOUNTING POLICI49
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Changes in Accumulated Balances of Other Comprehensive Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance | $ 321,011 | $ 265,599 | $ 223,917 | |
Total other comprehensive loss, net of tax | (2,924) | (4,943) | (5,327) | |
Balance | 400,221 | $ 321,011 | $ 265,599 | |
Unrealized gains (losses) on derivative instruments [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance | (1,334) | |||
Other comprehensive income (loss) before reclassifications | (10) | $ (2,168) | ||
Amounts reclassified from AOCI | 1,364 | 834 | ||
Total other comprehensive loss, net of tax | 1,354 | (1,334) | ||
Balance | 20 | (1,334) | ||
Accumulated Foreign Currency Translation Differences [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance | 800 | 3,680 | ||
Other comprehensive income (loss) before reclassifications | $ (2,712) | $ (2,880) | ||
Amounts reclassified from AOCI | ||||
Total other comprehensive loss, net of tax | $ (2,712) | $ (2,880) | ||
Balance | (1,912) | 800 | $ 3,680 | |
Accumulated Other Comprehensive Income (Loss), Net [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Balance | [1] | (534) | 3,680 | 8,517 |
Other comprehensive income (loss) before reclassifications | (2,722) | (5,048) | ||
Amounts reclassified from AOCI | 1,364 | 834 | ||
Total other comprehensive loss, net of tax | (1,358) | (4,214) | ||
Balance | [1] | $ (1,892) | $ (534) | $ 3,680 |
[1] | Accumulated other comprehensive income (loss), net, comprised of foreign currency translation and hedging transactions. |
SIGNIFICANT ACCOUNTING POLICI50
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Losses Reclassified Out of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Cost of revenues | $ 299,290 | $ 257,751 | $ 194,436 |
Research and development | 3,052 | 2,628 | 2,002 |
Marketing and selling | 59,521 | 55,870 | 51,209 |
General and administrative | 36,612 | 36,111 | 32,904 |
Net income | (79,458) | (80,259) | $ (64,353) |
Reclassification of AOCI [Member] | Cash Flow Hedge [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Cost of revenues | 1,105 | 692 | |
Research and development | 27 | 17 | |
Marketing and selling | 109 | 67 | |
General and administrative | 123 | 58 | |
Net income | $ 1,364 | $ 834 |
SIGNIFICANT ACCOUNTING POLICI51
SIGNIFICANT ACCOUNTING POLICIES (Accounting for stock-based compensation) (Details) - USD ($) $ in Thousands | Oct. 27, 2015 | Dec. 31, 2015 | Dec. 31, 2014 |
The fair value of each stock option award is estimated at the date of grant with the following weighted average assumptions: | |||
Phantom share based payment | $ 148 | $ 805 | |
Employee Stock Option [Member] | |||
The fair value of each stock option award is estimated at the date of grant with the following weighted average assumptions: | |||
Dividend yield | 0.00% | ||
Expected volatility | 41.10% | ||
Risk-free interest rate | 1.20% | ||
Expected life (years) | 3 years 11 months 23 days | ||
Stock options, expiration period | 7 years | ||
Employee Stock Option [Member] | Minimum [Member] | |||
The fair value of each stock option award is estimated at the date of grant with the following weighted average assumptions: | |||
Vesting period | 3 years | ||
Employee Stock Option [Member] | Maximum [Member] | |||
The fair value of each stock option award is estimated at the date of grant with the following weighted average assumptions: | |||
Vesting period | 4 years | ||
Phantom Share Based Payment [Member] | |||
The fair value of each stock option award is estimated at the date of grant with the following weighted average assumptions: | |||
Dividend yield | 0.00% | 0.00% | |
Expected volatility | 39.20% | 45.00% | |
Risk-free interest rate | 1.80% | 1.90% | |
Expected life (years) | 5 years 2 months 12 days | 6 years 3 months 18 days | |
Vesting period | 4 years | ||
Reclassified amount pursuant to modification | $ 195 | ||
Phantom share based payment | $ 538 | $ 1,555 | |
Unrecognized compensation cost | $ 52 | ||
RSUs [Member] | |||
The fair value of each stock option award is estimated at the date of grant with the following weighted average assumptions: | |||
Vesting period | 4 years |
SIGNIFICANT ACCOUNTING POLICI52
SIGNIFICANT ACCOUNTING POLICIES (Redeemable Non-Controlling Interest) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | |||
Beginning of the year | $ 8,715 | $ 7,624 | $ 7,106 |
Net income attributable to non-controlling interest | 1,692 | 1,820 | 1,009 |
Foreign currency translation adjustments | (1,566) | (729) | (491) |
Redeemable non-controlling interest-end of the year | $ 8,841 | $ 8,715 | $ 7,624 |
Canadian Quartz Holdings Inc. [Member] | |||
Noncontrolling Interest [Line Items] | |||
Equity interest held by CIOT | 45.00% |
OTHER ACCOUNTS RECEIVABLE AND53
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES (Schedule of Other Accounts Receivable and Prepaid Expenses) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES [Abstract] | ||
Prepaid expenses | $ 1,760 | $ 2,296 |
Government authorities | 10,459 | 5,765 |
Deferred tax assets | 11,249 | 8,384 |
Advances to suppliers | 2,976 | 2,480 |
Derivatives | 2,060 | 2,479 |
Other receivables (see also note 10) | 3,726 | 1,325 |
Other accounts receivables and prepaid expenses | $ 32,230 | $ 22,729 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Inventory [Line Items] | ||
Raw materials | $ 24,218 | $ 15,439 |
Work-in-progress | 1,422 | 726 |
Finished goods | 69,839 | 64,047 |
Inventories | $ 95,479 | $ 80,212 |
PROPERTY, PLANT AND EQUIPMENT55
PROPERTY, PLANT AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Property, Plant and Equipment, net [Line Items] | ||||
Cost | $ 332,768 | $ 261,738 | ||
Accumulated depreciation | 107,330 | 88,745 | ||
Depreciated cost | 225,438 | 172,993 | ||
Salvage value of derecognized fully depreciated property | 2,003 | |||
Depreciation expense | 19,243 | 13,974 | $ 11,626 | |
Machinery and Manufacturing Equipment [Member] | ||||
Property, Plant and Equipment, net [Line Items] | ||||
Cost | [1] | 218,610 | 173,937 | |
Investment grants received | 7,200 | |||
Office Equipment and Furniture [Member] | ||||
Property, Plant and Equipment, net [Line Items] | ||||
Cost | 12,757 | 8,633 | ||
Motor Vehicles [Member] | ||||
Property, Plant and Equipment, net [Line Items] | ||||
Cost | 855 | 948 | ||
Buildings and Leasehold Improvements [Member] | ||||
Property, Plant and Equipment, net [Line Items] | ||||
Cost | 99,607 | 77,281 | ||
Prepaid Expenses Related to Operating Lease [Member] | ||||
Property, Plant and Equipment, net [Line Items] | ||||
Cost | [2] | $ 939 | $ 939 | |
Operating lease term | 49 years | |||
Operating lease renewal term | 49 years | |||
[1] | Presented net of investment grants received in 2004, 2005 and 2006 years, in the total amount of $7,200. | |||
[2] | Until 2012, the Company leased land from the Israel Lands Administration ("ILA") for its Bar-Lev manufacturing facility. The lease term started on February 6, 2005. The lease is for an initial non-cancellable term of 49 years, with a renewal option of an additional 49 years. The Company analyzed the conditions set forth in ASC 840-10 and classified the land as an operating lease (since the land is not transferred to the Company at the end of the lease nor is there any option to buy the land from the ILA at any point). All payments on account of the initial term were paid in advance (based on discounted values) at the beginning of the lease, and included in the minimum lease payments to be amortized. The prepaid expenses are amortized through the term of the lease, based on the straight-line method (including the bargain renewal option term). See also note 13(d). |
OTHER INTANGIBLES ASSETS (Detai
OTHER INTANGIBLES ASSETS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Finite-Lived Intangible Assets [Line Items] | |||
Original amounts | $ 23,563 | $ 24,574 | |
Accumulated amortization | (16,680) | (14,515) | |
Total other intangibles assets | 6,883 | 10,059 | |
Amortization expense | 3,091 | 3,202 | $ 3,368 |
Estimated amortization expenses for the following years: | |||
2,016 | 2,338 | ||
2,017 | 2,304 | ||
2,018 | 2,241 | ||
Total | 6,883 | 10,059 | |
Non-compete Agreements [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Original amounts | 1,453 | 1,672 | |
Accumulated amortization | (1,434) | (1,646) | |
Distribution Relationships [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Original amounts | 1,594 | 1,698 | |
Accumulated amortization | (1,305) | (1,311) | |
Customer Relationships [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Original amounts | 5,910 | 6,588 | |
Accumulated amortization | (4,962) | (4,458) | |
Distribution Agreement [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Original amounts | 14,606 | 14,616 | |
Accumulated amortization | $ (8,979) | $ (7,100) |
GOODWILL (Details)
GOODWILL (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
GOODWILL [Abstract] | ||
Beginning balance | $ 37,960 | $ 39,702 |
Foreign currency translation adjustments | (2,139) | (1,742) |
Ending balance | $ 35,821 | $ 37,960 |
SHORT-TERM BANK CREDIT (Details
SHORT-TERM BANK CREDIT (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Short-term Debt [Line Items] | ||
Short-term bank credit | $ 3,241 | |
Weighted average interest | ||
Short-term bank credit | 3.04% | |
Short-term and revolving credit lines | $ 11,785 | $ 9,863 |
Israel [Member] | ||
Weighted average interest | ||
Short-term and revolving credit lines, expiration date | Dec. 31, 2016 | |
Canada [Member] | ||
Weighted average interest | ||
Short-term and revolving credit lines, expiration date | Jul. 31, 2016 |
ACCRUED EXPENSES AND OTHER LI59
ACCRUED EXPENSES AND OTHER LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
ACCRUED EXPENSES AND OTHER LIABILITIES [Abstract] | ||
Employees and payroll accruals | $ 10,438 | $ 10,582 |
Accrued expenses | 7,138 | 7,394 |
Advances from customers | 574 | 42 |
Taxes payable | 2,647 | 1,915 |
Warranty provision | 1,239 | 1,475 |
Derivatives | 1,421 | 2,900 |
Phantom share based payment | 390 | $ 750 |
Legal settlements and loss contingencies (see also note 10) | 3,647 | |
Other | 492 | $ 716 |
Accrued expenses and other liabilities | $ 27,986 | $ 25,774 |
COMMITMENTS AND CONTINGENT LI60
COMMITMENTS AND CONTINGENT LIABILITIES (Legal proceedings and contingencies) (Details) $ in Thousands, € in Millions, ZAR in Millions | 1 Months Ended | 12 Months Ended | 96 Months Ended | ||||||||||||||||||||
Nov. 30, 2015USD ($) | Nov. 30, 2015ILS (₪) | Dec. 31, 2015USD ($)claims | Dec. 31, 2015ILS (₪)claims | Dec. 31, 2014USD ($)claims | Dec. 31, 2013USD ($)claims | Dec. 31, 2013ILS (₪)claims | Dec. 31, 2015USD ($)claims | Nov. 30, 2015ILS (₪) | Oct. 31, 2015USD ($) | Oct. 31, 2015EUR (€) | Oct. 31, 2015ZAR | Apr. 27, 2014USD ($) | Apr. 27, 2014ILS (₪) | Dec. 31, 2012claims | Aug. 31, 2012USD ($) | Aug. 31, 2012ILS (₪) | Apr. 30, 2012USD ($) | Apr. 30, 2012ILS (₪) | Jan. 31, 2008USD ($) | Jan. 31, 2008EUR (€) | Dec. 31, 2007USD ($) | Dec. 31, 2007ILS (₪) | |
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Estimate of possible loss, maximum | $ 17,060 | € 15.7 | $ 257 | ₪ 1,000,000 | |||||||||||||||||||
Total liability imposed | $ 4,654 | ||||||||||||||||||||||
Loss contingency liability, current | 3,647 | $ 3,647 | |||||||||||||||||||||
Loss contingency liability, non-current | 11,190 | 11,190 | |||||||||||||||||||||
Non-current insurance receivable | $ 6,616 | $ 6,616 | |||||||||||||||||||||
Breach of Contract with Agent [Member] | Europe [Member] | |||||||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Estimate of possible loss, maximum | $ 7,727 | € 7.1 | |||||||||||||||||||||
Breach of Contract with Agent [Member] | South Africa [Member] | |||||||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Estimate of possible loss, maximum | $ 2,808 | ZAR 43.7 | |||||||||||||||||||||
Health Claims [Member] | |||||||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Number of claims filed | claims | 71 | ||||||||||||||||||||||
Damages granted | $ 1,400 | ₪ 5,300,000 | |||||||||||||||||||||
Percentage of damages borne by the entity | 33.00% | 33.00% | |||||||||||||||||||||
Health Claims [Member] | Judicial Ruling [Member] | |||||||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Damages granted | $ 206 | ₪ 800,000 | |||||||||||||||||||||
Total liability imposed | $ 112 | ₪ 436,669 | |||||||||||||||||||||
Health Claims [Member] | Plaintiff [Member] | |||||||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Percentage of damages borne by the entity | 40.00% | 40.00% | |||||||||||||||||||||
Health Claims [Member] | Israeli Ministry of Industry [Member] | |||||||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Percentage of damages borne by the entity | 27.00% | 27.00% | |||||||||||||||||||||
Health Claims Filed in Magistrate Court [Member] | |||||||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Number of claims pending | claims | 45 | 45 | |||||||||||||||||||||
Maximum amount per claim | $ 641 | ₪ 2,500,000 | |||||||||||||||||||||
Breach of Contract with Quartz Processor [Member] | |||||||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Amount of disputed payments | $ 55,000 | $ 55,000 | |||||||||||||||||||||
Breach of Contract Lawsuit Filed by Kfar Giladi Quarries [Member] | |||||||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Damages deposit amount | $ 25,600 | ₪ 100,000,000 | |||||||||||||||||||||
Amount of injunction sought to prevent disposition of assets, plant and equipment | $ 38,200 | ₪ 149,200,000 | |||||||||||||||||||||
Estimate of possible loss, maximum | $ 59,700 | ₪ 232,800,000 | |||||||||||||||||||||
Breach of Contract Lawsuit Filed Against Microgil and Kfar Giladi Quarries [Member] | |||||||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Estimate of possible loss, maximum | $ 19,600 | ₪ 76,600,000 | |||||||||||||||||||||
New Silicosis Claim [Member] | |||||||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||||||
Number of claims filed | claims | 19 | 19 | 28 | 8 | 8 | ||||||||||||||||||
Number of claims pending | claims | 71 | 54 | 27 | 27 | 71 | 20 | |||||||||||||||||
Amount of claim | $ 55,356 | ₪ 216,000,000 | |||||||||||||||||||||
Total liability imposed | $ 0 | ||||||||||||||||||||||
Legal settelments and loss contingencies | 4,654 | ||||||||||||||||||||||
Loss contingency liability | 14,837 | $ 14,837 | |||||||||||||||||||||
Loss contingency liability, current | 3,647 | 3,647 | |||||||||||||||||||||
Loss contingency liability, non-current | 11,190 | 11,190 | |||||||||||||||||||||
Insurance receivable | 10,183 | 10,183 | |||||||||||||||||||||
Current insurance receivable | 3,567 | 3,567 | |||||||||||||||||||||
Non-current insurance receivable | $ 6,616 | $ 6,616 |
COMMITMENTS AND CONTINGENT LI61
COMMITMENTS AND CONTINGENT LIABILITIES (Summary Of Cumulative product Claims Activity) (Details) - New Silicosis Claim [Member] - claims | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Loss Contingency Pending Claims Numer Roll Forward | |||
Open claims, January 1 | 54 | 27 | 20 |
New claims | 19 | 28 | 8 |
Settled and dismissed claims | (2) | (1) | (1) |
Open claims, December 31 | 71 | 54 | 27 |
COMMITMENTS AND CONTINGENT LI62
COMMITMENTS AND CONTINGENT LIABILITIES (Operating lease commitments) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
COMMITMENTS AND CONTINGENT LIABILITIES [Abstract] | |||
2,016 | $ 13,075 | ||
2,017 | 11,698 | ||
2,018 | 10,040 | ||
2,019 | 8,593 | ||
2,020 | 6,617 | ||
2021 and thereafter | 46,266 | ||
Total | 96,289 | ||
Lease expenses, net | $ 12,109 | $ 11,545 | $ 12,608 |
COMMITMENTS AND CONTINGENT LI63
COMMITMENTS AND CONTINGENT LIABILITIES (Purchase obligation) (Details) $ in Thousands | Dec. 31, 2015USD ($) | |
COMMITMENTS AND CONTINGENT LIABILITIES [Abstract] | ||
2,016 | $ 3,808 | [1] |
2017 and thereafter | ||
Total | $ 3,808 | |
[1] | Consists of purchase obligations to certain suppliers. |
COMMITMENTS AND CONTINGENT LI64
COMMITMENTS AND CONTINGENT LIABILITIES (Guarantees and Obligations) (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Guarantor Obligations [Line Items] | |
Guarantees outstanding | $ 1,210 |
TAXES ON INCOME (Narrative) (De
TAXES ON INCOME (Narrative) (Details) - USD ($) $ in Thousands | Jan. 01, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
TAXES ON INCOME [Abstract] | ||||
Liability for unrecognized tax benefits | $ 1,442 | $ 417 | ||
Interest accrued | $ 37 | $ 20 | ||
Income Tax Contingency [Line Items] | ||||
Corporate tax rate in Israel | 26.50% | 26.50% | 25.00% | |
Subsequent event [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Corporate tax rate in Israel | 25.00% | |||
Attributable to Approved Enterprise Programs [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Tax-exempt earnings | $ 19,828 | |||
Tax liability, if distributed | 5,254 | |||
Attributable to Beneficiary Enterprise Program [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Tax-exempt earnings | 15,494 | |||
Tax liability, if distributed | $ 4,106 | |||
Israel Tax Authority [Member] | Earliest Tax Year [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Open tax year | 2,012 | |||
Australian Taxation Office [Member] | Earliest Tax Year [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Open tax year | 2,011 | |||
Canada Revenue Agency [Member] | Earliest Tax Year [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Open tax year | 2,010 | |||
Internal Revenue Service (IRS) [Member] | Earliest Tax Year [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Open tax year | 2,012 | |||
Inland Revenue, Singapore (IRAS) [Member] | Earliest Tax Year [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Open tax year | 2,011 |
TAXES ON INCOME (Schedule of De
TAXES ON INCOME (Schedule of Deferred Income Taxes) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | |
Deferred tax assets (liability): | |||
Intangible assets | $ 110 | ||
Other temporary differences | [1] | $ 6,349 | 5,636 |
Temporary differences related to inventory | 1,755 | 637 | |
Phantom award | 21 | 53 | |
Unrealized profit from sales to subsidiary | 4,944 | 3,355 | |
Less-valuation allowance | (310) | (331) | |
Total net deferred tax assets | 12,759 | 9,460 | |
Deferred tax liabilities | |||
Property and equipment | (13,734) | (3,081) | |
Intangible assets | (2,486) | (2,910) | |
Other temporary differences | (141) | (20) | |
Total deferred tax liabilities | (16,361) | (6,011) | |
Deferred tax assets (liability), net | $ (3,602) | $ 3,449 | |
[1] | Deriving mainly from the following - provision for bad debts, labor provisions, warranty provision and related party liability for tax purposes. |
TAXES ON INCOME (Reconciliation
TAXES ON INCOME (Reconciliation of Company's Effective Tax Rate to Statutory Tax Rate) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
TAXES ON INCOME [Abstract] | |||
Income before taxes on income | $ 93,301 | $ 93,997 | $ 74,689 |
Statutory tax rate in Israel | 26.50% | 26.50% | 25.00% |
Income taxes at statutory rate | $ 24,725 | $ 24,909 | $ 18,672 |
Increase (decrease) in tax expenses resulting from: | |||
Tax benefit arising from reduced rate as an "Approved Enterprise" | (13,232) | (12,482) | (11,267) |
Non-deductible expenses, net | $ 1,073 | $ 856 | 1,274 |
Adjustment for change in tax law | $ 575 | ||
Decrease in taxes resulting from tax settlement with tax authorities | $ (513) | $ (286) | |
Tax adjustment in respect of foreign subsidiaries' different tax rates | 693 | 634 | $ 741 |
Uncertain tax position | 1,034 | 146 | 219 |
Changes in valuation allowance | (21) | (66) | 97 |
Others | 84 | 27 | 25 |
Income tax expense | $ 13,843 | $ 13,738 | $ 10,336 |
Effective tax rate | 15.00% | 15.00% | 14.00% |
Per share amounts (basic) of the tax benefit resulting from an "Approved Enterprise" | $ (0.38) | $ (0.36) | $ (0.32) |
Per share amounts (diluted) of the tax benefit resulting from an "Approved Enterprise" | $ (0.37) | $ (0.35) | $ (0.32) |
TAXES ON INCOME (Schedule of In
TAXES ON INCOME (Schedule of Income Before Taxes on Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
TAXES ON INCOME [Abstract] | |||
Domestic | $ 81,020 | $ 82,670 | $ 65,657 |
Foreign | 12,281 | 11,327 | 9,032 |
Income before taxes on income | $ 93,301 | $ 93,997 | $ 74,689 |
TAXES ON INCOME (Schedule of Ta
TAXES ON INCOME (Schedule of Tax Expenses on Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
TAXES ON INCOME [Abstract] | |||
Current taxes | $ 6,792 | $ 16,318 | $ 10,119 |
Deferred taxes | 7,051 | (2,580) | 217 |
Income tax expense | 13,843 | 13,738 | 10,336 |
Domestic | 9,892 | 9,646 | 6,395 |
Foreign | $ 3,951 | $ 4,092 | $ 3,941 |
TAXES ON INCOME (Reconciliati70
TAXES ON INCOME (Reconciliation of Beginning and Ending Balances of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
TAXES ON INCOME [Abstract] | |||
Gross tax liabilities, beginning balance | $ 417 | $ 1,395 | $ 1,084 |
Increases in tax positions for current year | 493 | 146 | 151 |
Addition of tax position of prior years | 541 | 68 | |
Addition of tax position of prior years | (1,076) | ||
Foreign currency adjustments | 92 | ||
Foreign currency adjustments | (9) | (48) | |
Gross tax liabilities, ending balance | $ 1,442 | $ 417 | $ 1,395 |
SHAREHOLDERS' EQUITY (Schedule
SHAREHOLDERS' EQUITY (Schedule of Share Capital) (Details) - ₪ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
SHAREHOLDERS' EQUITY [Abstract] | ||
Ordinary shares, par value per share | ₪ 0.04 | ₪ 0.04 |
Ordinary shares, shares authorized | 200,000,000 | 200,000,000 |
Ordinary shares, shares issued | 35,294,755 | 35,132,127 |
Ordinary shares, shares outstanding | 35,294,755 | 35,132,127 |
SHAREHOLDERS' EQUITY (Narrative
SHAREHOLDERS' EQUITY (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Class of Stock [Line Items] | ||||
Dividends paid | $ 20,025 | $ 20,149 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation expenses | $ 2,607 | $ 1,212 | ||
Employee Stock Option [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted-average grant-date fair value of options granted | $ 12.32 | |||
Intrinsic value of options exercised | $ 6,465 | |||
Unrecognized compensation cost | $ 9,743 | $ 9,743 | ||
Unrecognized compensation cost, weighted-average recognition period | 1 year 4 months 17 days | |||
Incentive Compensation Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of additional shares authorized | 900,000 | |||
Options and restricted stock units outstanding | 1,040,585 | 1,040,585 | ||
Ordinary shares reserved for issuance | 1,304,910 | 1,304,910 |
SHAREHOLDERS' EQUITY (Summary o
SHAREHOLDERS' EQUITY (Summary of Stock Option Activity) (Details) - Employee Stock Option [Member] $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($)$ / sharesshares | |
Number of options | |
Outstanding - beginning of the year | shares | 401,295 |
Granted | shares | 784,000 |
Exercised | shares | (193,029) |
Forfeited | shares | (6,781) |
Outstanding - end of the year | shares | 985,485 |
Options exercisable at the end of the year | shares | 103,747 |
Vested and expected to vest | shares | 985,485 |
Weighted average exercise price | |
Outstanding - beginning of the year | $ / shares | $ 10.09 |
Granted | $ / shares | 37.92 |
Exercised | $ / shares | 9.85 |
Forfeited | $ / shares | 9.85 |
Outstanding - end of the year | $ / shares | 32.28 |
Options exercisable at the end of the year | $ / shares | 37.66 |
Vested and expected to vest | $ / shares | $ 32.28 |
Aggregate intrinsic value | |
Exercised | $ | $ 6,465 |
Outstanding - end of the year | $ | 10,899 |
Options exercisable at the end of the year | $ | 589 |
Vested and expected to vest | $ | $ 10,899 |
SHAREHOLDERS' EQUITY (Summary74
SHAREHOLDERS' EQUITY (Summary of Activities Relating to Company's RSUs Granted to Employees) (Details) - RSUs [Member] $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($)$ / sharesshares | |
Number of RSUs | |
Outstanding - beginning of the year | shares | |
Granted | shares | 55,100 |
Exercised | shares | |
Forfeited | shares | |
Outstanding - end of the year | shares | 55,100 |
RSUs exercisable at the end of the year | shares | |
Vested and expected to vest | shares | 55,100 |
Weighted average fair value | |
Outstanding - beginning of the year | $ / shares | |
Granted | $ / shares | $ 35.04 |
Exercised | $ / shares | |
Forfeited | $ / shares | |
Outstanding - end of the year | $ / shares | $ 35.04 |
RSUs exercisable at the end of the year | $ / shares | |
Vested and expected to vest | $ / shares | $ 35.04 |
Aggregate intrinsic value | |
Outstanding - end of the year | $ | $ 2,387 |
RSUs exercisable at the end of the year | $ | |
Vested and expected to vest | $ | $ 2,387 |
SHAREHOLDERS' EQUITY (Schedul75
SHAREHOLDERS' EQUITY (Schedule of Awards Outstanding) (Details) | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number of options outstanding | shares | 1,040,585 |
Number of options exercisable | shares | 103,747 |
$ 9.85 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price | $ 9.85 |
Number of options outstanding | shares | 181,485 |
Awards outstanding, weighted average remaining contractual life (years) | 3 years 2 months 19 days |
Awards outstanding, weighted average exercise price per share | $ 9.85 |
Number of options exercisable | shares | 3,747 |
Awards exercisable, weighted average remaining contractual life (years) | 3 years 2 months 19 days |
Awards exercisable, weighted average exercise price | $ 9.85 |
$ 14.69 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price | $ 14.69 |
Number of options outstanding | shares | 20,000 |
Awards outstanding, weighted average remaining contractual life (years) | 3 years 10 months 2 days |
Awards outstanding, weighted average exercise price per share | $ 14.69 |
Number of options exercisable | shares | 10,000 |
Awards exercisable, weighted average remaining contractual life (years) | 3 years 10 months 2 days |
Awards exercisable, weighted average exercise price | $ 14.69 |
$ 34.60 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price | $ 34.60 |
Number of options outstanding | shares | 404,000 |
Awards outstanding, weighted average remaining contractual life (years) | 6 years 9 months 25 days |
Awards outstanding, weighted average exercise price per share | $ 34.60 |
Number of options exercisable | shares | |
Awards exercisable, weighted average remaining contractual life (years) | |
Awards exercisable, weighted average exercise price | |
$ 41.37-42.96 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price, minimum | $ 41.37 |
Exercise price, maximum | $ 42.96 |
Number of options outstanding | shares | 380,000 |
Awards outstanding, weighted average remaining contractual life (years) | 6 years 8 months 23 days |
Awards outstanding, weighted average exercise price per share | $ 41.45 |
Number of options exercisable | shares | 90,000 |
Awards exercisable, weighted average remaining contractual life (years) | 6 years 8 months 16 days |
Awards exercisable, weighted average exercise price | $ 41.37 |
RSUs [Member] | $ 0.01 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price | $ 0.01 |
Number of options outstanding | shares | 55,100 |
Awards outstanding, weighted average remaining contractual life (years) | 6 years 9 months 29 days |
Awards outstanding, weighted average exercise price per share | $ 0.01 |
Number of options exercisable | shares | |
Awards exercisable, weighted average remaining contractual life (years) | |
Awards exercisable, weighted average exercise price |
SHAREHOLDERS' EQUITY (Schedul76
SHAREHOLDERS' EQUITY (Schedule Compensation Expenses) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | $ 2,607 | $ 1,212 |
Cost of Revenues [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | 121 | 75 |
Research and Development Expenses [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | 96 | 52 |
Selling and Marketing Expenses [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | 259 | 210 |
General and Administration Expenses [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | $ 2,131 | $ 875 |
TRANSACTIONS WITH RELATED PAR77
TRANSACTIONS WITH RELATED PARTIES AND OTHER LOAN (Kibbutz Sdot-Yam) (Details) $ in Thousands | Aug. 06, 2013USD ($) | Aug. 06, 2013ILS (₪) | Jul. 31, 2015 | Sep. 30, 2014USD ($) | Sep. 30, 2014ILS (₪) | Dec. 31, 2015USD ($)m² | Dec. 31, 2015ILS (₪) | Dec. 31, 2014USD ($) | Dec. 31, 2014ILS (₪) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) | Dec. 31, 2012ILS (₪) | Dec. 31, 2011m²properties | Dec. 31, 2015ILS (₪)m² | Sep. 01, 2014m² | Jan. 01, 2014m² | |
Related Party Transaction [Line Items] | |||||||||||||||||
Area of property | m² | 30,744 | ||||||||||||||||
Consideration for annual fee payment for the year 2013 | [1] | $ 3,808 | |||||||||||||||
Amount of agreement | $ 3,808 | ||||||||||||||||
Kibbutz Sdot-Yam [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Percentage of ownership | 32.40% | 32.40% | |||||||||||||||
Notice period to cancel automatic renewal of agreement | 6 months | ||||||||||||||||
Sale Lease back Transaction Additional Renewal Termo of Lease | 1 year | ||||||||||||||||
Interest rate | 6.19% | 6.19% | |||||||||||||||
Proceeds from sale-leaseback transaction | $ 10,900 | ₪ 43,700,000 | |||||||||||||||
Lease term | 10 years | 10 years | |||||||||||||||
Annual rent | $ 1,100 | ₪ 4,100,000 | |||||||||||||||
Liability arising from partial sale-leaseback | $ 9,647 | ||||||||||||||||
Deferred tax asset | 905 | $ 1,001 | |||||||||||||||
Deferred tax liability | 1,065 | 1,050 | |||||||||||||||
Kibbutz Sdot-Yam [Member] | Land Purchase Agreement and Leaseback [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Agreement amount | $ 1,092 | 1,192 | $ 1,149 | ||||||||||||||
Kibbutz Sdot-Yam [Member] | Manpower Agreement [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Contract term | 10 years | 10 years | |||||||||||||||
Additional contract term | 3 years | 3 years | |||||||||||||||
Expenses with related party | $ 3,425 | 3,939 | 3,857 | ||||||||||||||
Agreement amount | $ 64 | ₪ 250,000 | |||||||||||||||
Kibbutz Sdot-Yam [Member] | Kibbutz Services [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Contract term | 8 years | 8 years | |||||||||||||||
Expenses with related party | $ 1,806 | 2,118 | 2,112 | ||||||||||||||
Notice period to cancel agreement upon a material breach | 30 days | 30 days | |||||||||||||||
Notice period to cancel agreement upon liquidation of the other party | 45 days | 45 days | |||||||||||||||
Kibbutz Sdot-Yam [Member] | Land Use Agreement [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Contract term | 20 years | 20 years | 3 years | ||||||||||||||
Notice period to cancel agreement upon liquidation of the other party | 90 days | 90 days | |||||||||||||||
Number of facilities | properties | 1 | ||||||||||||||||
Area of property | m² | 100,000 | 100,000 | 9,000 | 400 | |||||||||||||
Fee for land use agreement | $ 18 | ₪ 70,000 | $ 3 | ₪ 10,000 | $ 30 | ₪ 116,643 | 20 | ₪ 77,956 | |||||||||
Payments for land use right | 3,564 | $ 3,847 | $ 3,702 | ||||||||||||||
Consideration for annual fee payment for the year 2013 | 3,500 | ₪ 12,900,000 | |||||||||||||||
Kibbutz Sdot-Yam [Member] | Land Use Agreement [Member] | Scenario One [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Building expenses not included in land use fees | 24 | 82,900 | |||||||||||||||
Kibbutz Sdot-Yam [Member] | Land Use Agreement [Member] | Scenario Two [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Building expenses not included in land use fees | 12 | 43,000 | |||||||||||||||
Kibbutz Sdot-Yam [Member] | Land Use Agreement [Member] | Additional Leased Area [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Agreement amount | $ 18 | ₪ 62,000 | |||||||||||||||
Kibbutz Sdot-Yam [Member] | Land Use Agreement [Member] | Warehouse Site [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Interest rate | 5.30% | 5.30% | |||||||||||||||
Kibbutz Sdot-Yam [Member] | Construction of Access Road [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Amount of agreement | $ 800 | 3,300,000 | |||||||||||||||
Kibbutz Sdot-Yam [Member] | Paving Commitment [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Amount of agreement | $ 51 | ₪ 200,000 | |||||||||||||||
[1] | Consists of purchase obligations to certain suppliers. |
TRANSACTIONS WITH RELATED PAR78
TRANSACTIONS WITH RELATED PARTIES AND OTHER LOAN (Schedule of Financing Leaseback) (Details) - Kibbutz Sdot-Yam [Member] $ in Thousands | Dec. 31, 2015USD ($) |
Related Party Transaction [Line Items] | |
2,016 | $ 521 |
2,017 | 554 |
2,018 | 588 |
2,019 | 624 |
2,020 | 663 |
2021 and thereafter | 6,697 |
Total long-term loans | $ 9,647 |
TRANSACTIONS WITH RELATED PAR79
TRANSACTIONS WITH RELATED PARTIES AND OTHER LOAN (Former Shareholder) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2013USD ($) | |
Tene [Member] | General and Administrative Expense [Member] | |
Related Party Transaction [Line Items] | |
Compensation expenses related to bonus paid | $ 810 |
TRANSACTIONS WITH RELATED PAR80
TRANSACTIONS WITH RELATED PARTIES AND OTHER LOAN (Schedule of Transactions with Related Parties) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
TRANSACTIONS WITH RELATED PARTIES AND OTHER LOAN [Abstract] | |||
Cost of revenues | $ 7,638 | $ 9,073 | $ 8,792 |
Research and development | 180 | 123 | 211 |
Selling and marketing | 691 | 373 | 632 |
General and administrative | 1,828 | 2,538 | 1,649 |
Finance expenses, net | $ 597 | $ 685 | $ 671 |
TRANSACTIONS WITH RELATED PAR81
TRANSACTIONS WITH RELATED PARTIES AND OTHER LOAN (Schedule of Balances with Related Parties) (Details) $ in Thousands, CAD in Millions | Jan. 17, 2011CAD | Dec. 31, 2012USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Related Party Transaction [Line Items] | |||||
Related party and other loan | [1] | $ 3,251 | $ 3,975 | ||
Long-term loan and financing leaseback from a related party | [2] | $ 8,472 | $ 8,993 | ||
Caesarstone Canada Inc [Member] | |||||
Related Party Transaction [Line Items] | |||||
Long-term loan and financing leaseback from a related party | CAD | CAD 4 | ||||
Related party transaction, interest rate | 0.25% | ||||
Kibbutz Sdot-Yam [Member] | |||||
Related Party Transaction [Line Items] | |||||
Proceeds from financing leaseback | $ 10,900 | ||||
Related party transaction, interest rate | 6.19% | ||||
[1] | On January 17, 2011 a loan of 4 million Canadian dollars was made to Caesarstone Canada Inc. by its shareholders, CIOT and the Company, on a pro rata basis. The loan bears interest until repayment at a per annum rate equal to Bank of Canada's prime business rate plus 0.25%. The interest accrued on the loan is payable on a quarterly basis. As of December 31, 2015 the loan was classified to short term related party and other loan balance. | ||||
[2] | In September, 2012, a financing leaseback of $10.9 million related to Bar-Lev transaction was granted to the Company by Kibbutz Sdot-Yam. The financing leaseback bears interest until repayment at a per annum rate equal to 6.19% and is subject to adjustment for increases in the Israeli consumer price index. |
MAJOR CUSTOMER AND GEOGRAPHIC82
MAJOR CUSTOMER AND GEOGRAPHIC INFORMATION (Schedule of Revenues) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 499,515 | $ 447,402 | $ 356,554 |
United States [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | 223,341 | 185,583 | 123,399 |
Australia [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | 110,290 | 107,539 | 89,894 |
Canada [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | 70,739 | 57,898 | 49,214 |
Israel [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | 39,645 | 41,286 | 42,024 |
Europe [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | 23,949 | 23,109 | 22,973 |
Rest of World [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 31,551 | $ 31,987 | $ 29,050 |
MAJOR CUSTOMER AND GEOGRAPHIC83
MAJOR CUSTOMER AND GEOGRAPHIC INFORMATION (Schedule of Long-Lived Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 225,438 | $ 172,993 |
Israel [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 88,658 | 93,976 |
Australia [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 1,657 | 1,857 |
United States [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 133,481 | 75,873 |
Canada [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 1,548 | 1,144 |
Rest of World [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 94 | $ 143 |
SELECTED SUPPLEMENTARY STATEM84
SELECTED SUPPLEMENTARY STATEMENTS OF INCOME DATA (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Finance expenses: | |||
Interest in respect of long-term loans | $ 53 | ||
Interest in respect of short-term loans and bank fees | $ 2,792 | $ 3,038 | 1,565 |
Interest in respect of loans to related parties | $ 640 | 732 | $ 729 |
Changes in derivatives fair value | $ 2,710 | ||
Foreign exchange transactions losses | $ 2,972 | $ 6,107 | |
Finance expenses | 6,404 | $ 6,480 | 8,454 |
Finance income: | |||
Changes in derivatives fair value | 1,060 | 6,485 | |
Income in respect of cash and cash equivalent and short-term bank deposits | 77 | $ 403 | $ 655 |
Foreign exchange transactions gains | 2,182 | 5,032 | |
Finance income | 3,319 | 5,435 | $ 7,140 |
Finance expenses, net | 3,085 | 1,045 | 1,314 |
Numerator: | |||
Net income attributable to controlling interest, as reported | 77,766 | 78,439 | 63,344 |
Numerator for basic and diluted net income per share | $ 77,766 | $ 78,439 | $ 63,344 |
Denominator: | |||
Denominator for basic income per share | 35,252,596 | 34,932,000 | 34,666,514 |
Effect of dilutive stock based awards | 211,102 | 462,499 | 543,432 |
Denominator for diluted income per share | 35,463,698 | 35,394,499 | 35,209,946 |
Earnings Per Share | |||
Basic earnings per share | $ 2.21 | $ 2.25 | $ 1.83 |
Diluted earnings per share | $ 2.19 | $ 2.22 | $ 1.80 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ in Thousands | Feb. 09, 2016USD ($) |
Subsequent event [Member] | |
Subsequent Event [Line Items] | |
Amount authorized for share repurchase | $ 40,000 |