Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 27, 2015 | Oct. 20, 2015 | |
Document And Entity Information | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 27, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | CTS | |
Entity Registrant Name | CTS CORP | |
Entity Central Index Key | 26,058 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 32,637,797 |
Consolidated Statements of (Los
Consolidated Statements of (Loss) Earnings - Unaudited - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 27, 2015 | Sep. 28, 2014 | Sep. 27, 2015 | Sep. 28, 2014 | |
CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) EARNINGS UNAUDITED | ||||
Net sales | $ 90,646 | $ 99,957 | $ 289,028 | $ 303,643 |
Costs and expenses: | ||||
Cost of goods sold | 59,200 | 67,458 | 192,073 | 206,706 |
Selling, general and administrative expenses | 12,690 | 13,899 | 43,625 | 43,353 |
Research and development expenses | 5,692 | 5,807 | 16,378 | 16,765 |
Environmental charge | 14,541 | 14,541 | ||
Restructuring and impairment charges | 2,373 | 1,570 | 5,229 | 4,806 |
Operating (loss) earnings | (3,850) | 11,223 | 17,182 | 32,013 |
Other (expense) income: | ||||
Interest expense | (714) | (568) | (1,955) | (1,763) |
Interest income | 713 | 707 | 2,354 | 1,959 |
Other | (3,072) | 562 | (4,641) | (1,618) |
Total other (expense) income | (3,073) | 701 | (4,242) | (1,422) |
(Loss) earnings before income taxes | (6,923) | 11,924 | 12,940 | 30,591 |
Income tax (benefit) expense | (2,163) | 3,807 | (7,667) | 11,033 |
Net (loss) earnings | $ (4,760) | $ 8,117 | $ 20,607 | $ 19,558 |
(Loss) earnings per share: | ||||
Basic (in dollars per share) | $ (0.15) | $ 0.24 | $ 0.62 | $ 0.58 |
Diluted (in dollars per share) | $ (0.15) | $ 0.24 | $ 0.61 | $ 0.57 |
Basic weighted - average common shares outstanding (in shares): | 32,770 | 33,599 | 33,083 | 33,683 |
Effect of dilutive securities (in shares) | 508 | 485 | 515 | |
Diluted weighted - average common shares outstanding (in shares) | 32,770 | 34,107 | 33,568 | 34,198 |
Cash dividends declared per share (in dollars per share) | $ 0.040 | $ 0.040 | $ 0.120 | $ 0.120 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Earnings - Unaudited - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 27, 2015 | Sep. 28, 2014 | Sep. 27, 2015 | Sep. 28, 2014 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS UNAUDITED | ||||
Net earnings (loss) | $ (4,760) | $ 8,117 | $ 20,607 | $ 19,558 |
Other comprehensive (loss) earnings: | ||||
Changes in fair market value of hedges, net of tax | (17) | 153 | (34) | 26 |
Changes in unrealized pension cost, net of tax | 1,336 | 1,036 | 3,299 | 2,857 |
Cumulative translation adjustment, net of tax | (1,204) | (981) | (817) | (160) |
Other comprehensive earnings | 115 | 208 | 2,448 | 2,723 |
Comprehensive (loss) earnings | $ (4,645) | $ 8,325 | $ 23,055 | $ 22,281 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - Unaudited - USD ($) $ in Thousands | Sep. 27, 2015 | Dec. 31, 2014 |
Current Assets | ||
Cash and cash equivalents | $ 150,755 | $ 134,508 |
Accounts receivable, net | 59,213 | 56,894 |
Inventories, net | 26,974 | 27,887 |
Other current assets | 20,766 | 21,112 |
Total current assets | 257,708 | 240,401 |
Long-lived assets | 68,932 | 71,414 |
Other assets | ||
Prepaid pension asset | 38,773 | 32,099 |
Goodwill | 32,047 | 32,047 |
Indefinite-lived intangible asset | 690 | 690 |
Intangible assets, other than goodwill | 32,960 | 35,902 |
Deferred income taxes | 56,610 | 43,120 |
Other assets | 1,021 | 1,253 |
Total other assets | 162,101 | 145,111 |
Total Assets | 488,741 | 456,926 |
Current Liabilities | ||
Accounts payable | 39,483 | 43,343 |
Accrued salaries, wages and vacation | 9,089 | 11,283 |
Increase in other accrued liabilities due to fair value adjustment | 43,031 | 25,356 |
Total current liabilities | 91,603 | 79,982 |
Long-term debt | 90,500 | 75,000 |
Post retirement obligations | 2,729 | 3,049 |
Other long-term obligations | 8,305 | 9,106 |
Shareholders' Equity | ||
Common stock | 300,897 | 299,892 |
Additional contributed capital | 40,481 | 39,153 |
Retained earnings | 396,796 | 380,145 |
Accumulated other comprehensive loss | (101,785) | (104,233) |
Total shareholder's equity before treasury stock | 636,389 | 614,957 |
Treasury stock | (340,785) | (325,168) |
Total shareholders' equity | 295,604 | 289,789 |
Total Liabilities and Shareholders' Equity | $ 488,741 | $ 456,926 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - Unaudited - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 27, 2015 | Sep. 28, 2014 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net earnings (loss) | $ 20,607 | $ 19,558 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 11,987 | 12,722 |
Amortization of retirement benefit adjustments | 4,945 | 4,296 |
Equity-based compensation | 2,655 | 1,839 |
Restructuring charges | 5,229 | 4,806 |
Prepaid pension asset | (6,633) | (6,687) |
Gain on sale of fixed assets | (121) | (1,915) |
Changes in assets and liabilities, net of acquisitions and divestitures: | ||
Accounts receivable | (3,518) | (1,115) |
Inventories | (34) | 1,889 |
Accounts payable | (4,967) | (1,175) |
Accrued payroll and benefits | (1,573) | (9,207) |
Accrued liabilities | 9,945 | (7,997) |
Income taxes payable | 1,715 | 1,599 |
Deferred income taxes | (15,428) | 3,872 |
Other | (691) | (7,142) |
Net cash provided by operating activities | 24,118 | 15,343 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital expenditures | (6,559) | (9,006) |
Proceeds from sale of assets | (1,878) | (1,851) |
Net cash used in investing activities | (4,681) | (7,155) |
Cash flows from financing activities: | ||
Payments of long-term debt | (943,300) | (757,700) |
Proceeds from borrowings of long-term debt | 958,800 | 763,000 |
Payments of short-term notes payable | (164) | (778) |
Proceeds from borrowings of short-term notes payable | 164 | 778 |
Purchase of treasury stock | (15,623) | (5,084) |
Dividends paid | (3,984) | (4,038) |
Exercise of stock options | 64 | 1,328 |
Other | 144 | 235 |
Net cash used in financing activities | (3,899) | (2,259) |
Effect of exchange rate on cash and cash equivalents | 709 | 587 |
Net increase in cash and cash equivalents | 16,247 | 6,516 |
Cash and cash equivalents at beginning of year | 134,508 | 124,368 |
Cash and cash equivalents at end of year | 150,755 | 130,884 |
Supplemental cash flow information | ||
Cash paid for Interest | 1,717 | 1,434 |
Cash paid for Income taxes, net | $ 5,657 | $ 6,141 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 27, 2015 | |
Basis of Presentation | |
Basis of Presentation | NOTE 1—Basis of Presentation The accompanying condensed consolidated financial statements have been prepared by CTS Corporation (“CTS” or “the Company”), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations. The unaudited condensed consolidated financial statements should be read in conjunction with the financial statements, notes thereto, and other information included in the Company’s Annual Report on Form 10 ‑K for the year ended December 31, 2014 . The accompanying unaudited condensed consolidated financial statements reflect, in the opinion of management, all adjustments (consisting of normal recurring items) necessary for a fair statement, in all material respects, of the financial position and results of operations for the periods presented. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ materially from those estimates. The results of operations for the interim periods are not necessarily indicative of the results for the entire year. Reclassifications Certain reclassifications have been made for the prior periods presented in the Unaudited Condensed Consolidated Statements of Cash Flows to conform to the current period’s presentation. |
Accounts Receivable
Accounts Receivable | 9 Months Ended |
Sep. 27, 2015 | |
Accounts Receivable | |
Accounts Receivable | NOTE 2 – Accounts Receivable The components of accounts receivable are as follows: As of September 27, December 31, ($ in thousands) 2015 2014 Accounts receivable, gross $ $ Less: Allowance for doubtful accounts Accounts receivable, net $ $ |
Inventories
Inventories | 9 Months Ended |
Sep. 27, 2015 | |
Inventories | |
Inventories | NOTE 3 – Inventories Inventories consist of the following: As of September 27, December 31, ($ in thousands) 2015 2014 Finished goods $ $ Work-in-process Raw materials Less: Inventory reserves Inventories, net $ $ |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Sep. 27, 2015 | |
Property, Plant and Equipment. | |
Property, Plant and Equipment | NOTE 4 – Property, Plant and Equipment Property, plant and equipment is comprised of the following: As of September 27, December 31, ($ in thousands) 2015 2014 Land $ $ Buildings and improvements Machinery and equipment Less: Accumulated depreciation Property, plant and equipment, net $ $ |
Retirement Plans
Retirement Plans | 9 Months Ended |
Sep. 27, 2015 | |
Retirement Plans | |
Retirement Plans | N OTE 5 – Retirement Plans Pension Plans Net pension income for our domestic and foreign plans was as follows: Three Months Ended Nine Months Ended ($ in thousands) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Net pension income $ $ $ $ Net pension (income) expense breakdown for our domestic and foreign plans include the following components: Domestic Pension Plans Foreign Pension Plans Three months: Three Months Ended Three Months Ended ($ in thousands) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Service cost $ $ $ $ Interest cost Expected return on plan assets (1) Amortization of loss Other cost due to retirement — — — — (Income) expense, net $ $ $ $ Domestic Pension Plans Foreign Pension Plans Nine months: Nine Months Ended Nine Months Ended ($ in thousands ) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Service cost $ $ $ $ Interest cost Expected return on plan assets (1) Amortization of loss Other cost due to retirement — — — (Income) expense, net $ $ $ $ (1) Expected return on plan assets is net of expected investment expenses and certain administrative expenses. Other Postretirement Benefit Plan Net postretirement expense for our postretirement plan includes the following components: Three Months Ended Nine Months Ended ($ in thousands) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Other postretirement benefit plan Service cost $ $ $ $ Interest cost Amortization of gain Postretirement expense $ $ $ $ |
Other Intangible Assets
Other Intangible Assets | 9 Months Ended |
Sep. 27, 2015 | |
Other Intangible Assets. | |
Other Intangible Assets | NOTE 6 – Other Intangible Assets Intangible assets consist of the following components: As of September 27, 2015 ($ in thousands) Gross Carrying Amount Accumulated Amortization Net Amount Amortized intangible assets: Customer lists/relationships $ $ $ Patents — Other intangibles Other intangible assets, net $ $ $ Amortization expense for the three months ended September 27, 2015 $ Amortization expense for the nine months ended September 27, 2015 $ As of December 31, 2014 ($ in thousands) Gross Carrying Amount Accumulated Amortization Net Amount Amortized intangible assets: Customer lists/relationships $ $ $ Patents — Other intangibles Other intangible assets, net $ $ $ Amortization expense for the three months ended September 28, 2014 $ Amortization expense for the nine months ended September 28, 2014 $ Amortization expense remaining for other intangible assets is as follows: ($ in thousands) Amortization expense 2015 $ 2016 2017 2018 2019 Thereafter Total amortization expense $ |
Costs Associated with Exit and
Costs Associated with Exit and Restructuring Activities | 9 Months Ended |
Sep. 27, 2015 | |
Costs Associated with Exit and Restructuring Activities | |
Costs Associated with Exit and Restructuring Activities | NOTE 7 – Costs Associated with Exit and Restructuring Activities Costs associated with exit and restructuring activities are recorded in the Condensed Consolidated Statement of Earnings as follows: restructuring related charges are recorded as a component of Cost of Goods Sold, and restructuring and impairment charges are reported on a separate line and included in Operating Earnings. Total restructuring, impairment and restructuring related charges were as follows: Three Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ $ Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ Nine Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ $ Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ During April 2014, CTS announced plans to restructure its operations and consolidate its Canadian operations into other existing CTS facilities as part of CTS’ overall plan to simplify its business model and rationalize its global footprint (“April 2014 Plan”). During the second quarter of 2015, CTS management revised the April 2014 Plan. The amendment added an additional $4,250,000 in planned costs. Additional administrative and legal costs are estimated to account for $1,300,000 of additional restructuring and impairment charges due to the extension of the timing of the plant shutdown. The remaining $2,950,000 in restructuring related charges are for additional costs related to equipment relocation, training, travel and shipping costs to facilitate an effective transition. The above actions are expected to be substantially complete in 2015. These restructuring actions will result in the elimination of approximately 120 positions. These actions are expected to be completed in 2015. The following table displays the planned restructuring and restructuring-related charges associated with the April 2014 Plan, as well as a summary of the actual costs incurred through September 27, 2015 : Actual costs Planned incurred through ($ in thousands) April 2014 Plan Costs September 27, 2015 Inventory write-down $ $ — Equipment relocation Other charges Restructuring related charges, included in cost of goods sold $ $ Workforce reduction $ $ Asset impairment charge — — Other charges, including pension termination costs Restructuring and impairment charges $ $ Total restructuring, impairment and restructuring related charges $ $ Under the April 2014 Plan, total restructuring, impairment and restructuring related charges were as follows: Three Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ $ — Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ Nine Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ $ — Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ During June 2013, CTS announced a restructuring plan to simplify CTS’ global footprint by consolidating manufacturing facilities into existing locations (“June 2013 Plan”). The June 2013 Plan includes the consolidation of operations from the U.K. manufacturing facility into the Czech Republic facility, the Carol Stream, Illinois manufacturing facility into the Juarez, Mexico facility and to discontinue manufacturing at its Singapore facility. Certain Corporate functions were consolidated or eliminated as a result of the June 2013 Plan. These restructuring actions will result in the elimination of approximately 350 positions. The above actions are expected to be completed in 2015. During the fourth quarter of 2014, CTS management revised the June 2013 Plan. The amendment added an additional $4,000,000 in planned costs. Future settlement of the U.K. pension plan is estimated to account for $2,000,000 of the added cost. The remaining $2,000,000 in restructuring and impairment charges are for severance costs and will result in the elimination of approximately 130 additional positions. The positions eliminated will be spread globally throughout CTS businesses. The above actions are expected to be substantially complete in 2015. The following table displays the planned restructuring and restructuring-related charges associated with the realignment, as well as a summary of the actual costs incurred through September 27, 2015 : Planned Actual costs incurred through ($ in thousands) June 2013 Plan Costs September 27, 2015 Inventory write-down $ $ Equipment relocation Other charges Restructuring-related charges, included in cost of goods sold $ $ Workforce reduction $ $ Asset impairment charge Other charges, including pension termination costs Restructuring and impairment charges $ $ Total restructuring and restructuring-related charges $ $ Under the June 2013 Plan, total restructuring, impairment and restructuring related charges incurred were as follows: Three Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ — $ Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ Nine Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ $ Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ The following table displays the restructuring reserve activity for the period ended September 27, 2015 : ($ in thousands ) June 2013 Plan and April 2014 Plan Restructuring liability at January 1, 2015 $ Restructuring and restructuring-related charges, excluding asset impairments and write-offs Cost paid Restructuring liability at September 27, 2015 $ |
Accrued Liabilities
Accrued Liabilities | 9 Months Ended |
Sep. 27, 2015 | |
Accrued Liabilities. | |
Accrued Liabilities | NOTE 8 – Accrued Liabilities The components of accrued liabilities are as follows: As of September 27, December 31, ($ in thousands) 2015 2014 Accrued product related costs $ $ Accrued income taxes Accrued property and other taxes Dividends payable Remediation and monitoring reserves Other accrued liabilities Total accrued liabilities $ $ Remediation and monitoring reserves of $19,085,000 as of September 27, 2015 include a non-recurring environmental charge for the third quarter of 2015 of $14,541,000 which represents the estimated liability for one of the CTS’ sites. See further discussion in Note 9. Other remediation and monitoring charges incurred in the normal course of business are recorded in selling, general, and administrative expenses. |
Contingencies
Contingencies | 9 Months Ended |
Sep. 27, 2015 | |
Contingencies | |
Contingencies | NOTE 9 – Contingencies Certain processes in the manufacture of CTS’ current and past products create hazardous waste by-products as currently defined by federal and state laws and regulations. CTS has been notified by the U.S. Environmental Protection Agency (“EPA”), state environmental agencies and, in some cases, generator groups, that it is or may be a potentially responsible party regarding hazardous substances at several sites either owned, not owned, or operated by CTS. Some sites are Superfund sites such as in Asheville, North Carolina and Mountain View, California. Estimating our degree of responsibility for remediation is inherently difficult. CTS recognizes and accrues for an estimated remediation liability when it determines that such liability is probable and estimable. CTS accrues for losses associated with environmental remediation obligations when such losses are probable and reasonably estimable. Accruals for estimated losses from environmental remediation obligations generally are recognized no later than completion of the remedial feasibility study. Accruals are adjusted as further information develops or circumstances change. Costs of future expenditures for environmental remediation obligations are not discounted to their present value. In addition to amounts accrued, remediation expenses are also paid as incurred. Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is considered probable. As a result of this practice, to provide for certain remedial work expected to commence in 2016 relating to the Asheville site, CTS increased its accrual for remediation and monitoring reserves, as set forth in Note 8. This increased amount reflects the probable costs to remediate environmental conditions at the site for which costs can be reasonably estimated. Based on the current projection modeling of the most probable outcome, CTS recorded an additional non-recurring environmental charge of $14,541,000 in the third quarter of 2015. The charge recorded includes both the interim remediation proposed by CTS and accepted by the EPA and anticipated future remediation costs and monitoring for a final site-wide remediation. As assessments and cleanups proceed, the reserve may be adjusted based on progress made in determining the extent of remedial actions and related costs. In the opinion of management, based upon presently available information relating to all such matters, adequate provision for probable and estimable costs has been made. CTS cannot provide assurance that its ultimate environmental investigation and cleanup costs and liabilities will not exceed the amount of its current reserve. CTS manufactures accelerator pedals for a number of automobile manufacturers, including subsidiaries of Toyota Motor Corporation (“Toyota”). In January 2010, Toyota initiated a recall of a substantial number of vehicles in North America containing pedals manufactured by CTS. The recall expanded to include vehicles in Europe and Asia. The pedal recall and associated events have led to CTS being named as a co-defendant with Toyota in certain litigation in the United States and Canada. CTS is not aware of any legal actions filed in Asia or Europe against CTS at this time. In February 2010, CTS entered into an agreement with Toyota whereby Toyota agreed that it will indemnify, defend, and hold CTS harmless from, and the parties will cooperate in the defense of, third-party civil claims and actions that are filed or asserted in the United States or Canada and that arise from or relate to alleged incidents of unintended acceleration of Toyota and Lexus vehicles. The limited exceptions to indemnification restrict CTS’ share of any liability to amounts collectable from its insurers. Certain other claims are pending against CTS with respect to matters arising out of the ordinary conduct of CTS’ business. In the opinion of management, based upon past experience and presently available information, either adequate provision for anticipated costs has been reserved or the ultimate anticipated costs will not materially affect CTS’ consolidated financial position, results of operations, or cash flows. |
Debt
Debt | 9 Months Ended |
Sep. 27, 2015 | |
Debt | |
Debt | NOTE 10 - Debt Long-term debt was comprised of the following: As of September 27, December 31, ($ in thousands) 2015 2014 Revolving credit facility due in 2020 $ $ Weighted average interest rate % % Amount available $ $ Total credit facility $ $ Standby letters of credit $ $ Commitment fee percentage per annum On August 10, 2015, CTS entered into a new five -year credit agreement with a group of banks (“Revolving Credit Facility”) in order to support CTS’ working capital needs and other general corporate purposes. The Revolving Credit Facility provides for a credit line of $200 ,000,000 , which may be increased by $100,000,000 at the request of CTS, subject to an Administrative Agent’s approval. This Revolving Credit Facility replaces the prior unsecured credit facility. Borrowings under the previous credit agreement were refinanced under the new Revolving Credit Facility and the previous credit agreement was terminated on August 10, 2015. The revolving credit facility provided under the new credit agreement includes a swing line sublimit of $15,000,000 and a letter of credit sublimit of $10,000,000 . Borrowings under the credit facility bear interest, at CTS’ option, at the base rate plus the applicable margin for base rate loans or LIBOR plus the applicable margin for LIBOR loans. CTS also pays a quarterly commitment fee on the unused portion of the revolving credit facility. The commitment fee may range from 0.20% to 0.40% based on the CTS’ total leverage ratio. The revolving credit facility requires, among other things, that CTS comply with a maximum total leverage ratio and a minimum fixed charge coverage ratio. Failure of CTS to comply with these covenants could reduce the borrowing availability under the revolving credit facility. CTS was in compliance with all debt covenants at September 27, 2015 . The revolving credit facility requires CTS to deliver quarterly financial statements, annual financial statements, auditors certifications and compliance certificates within a specified number of days after the end of a quarter and year. Additionally, the revolving credit facility contains restrictions limiting CTS' ability to: dispose of assets; incur certain additional debt; repay other debt or amend subordinated debt instruments; create liens on assets; make investments, loans or advances; make acquisitions or engage in mergers or consolidations; engage in certain transactions with CTS' subsidiaries and affiliates; and make stock repurchases and dividend payments. Interest rates on the revolving credit facility fluctuate based upon the London Interbank Offered Rate and the Company’s quarterly total leverage ratio. CTS pays a commitment fee on the undrawn portion of the revolving credit facility. The commitment fee varies based on the quarterly leverage ratio. CTS has debt issuance costs related to its long-term debt that are being amortized using the straight-line method over the life of the debt. Amortization expense was approximately $61,000 for the three months ended September 27, 2015 and approximately $165,000 for the nine months ended September, 27, 2015 and was recognized as interest expense. CTS uses interest rate swaps to convert the revolving credit facility’s variable rate of interest into a fixed rate. In the second quarter of 2012, CTS entered into four separate interest rate swap agreements to fix interest rates on $50,000,000 of long-term debt for the periods January 2013 to January 2017. In the third quarter of 2012, CTS entered into four separate interest rate swap agreements to fix interest rates on $25,000,000 of long-term debt for the periods January 2013 to January 2017. The difference to be paid or received under the terms of the swap agreements will be recognized as an adjustment to interest expense when settled. These swaps are treated as cash flow hedges and consequently, the changes in fair value were recorded in Other comprehensive (loss) income. The estimated net amount of the existing gains or losses that are reported in accumulated other comprehensive (loss) income that is expected to be reclassified into earnings within the next twelve months is approximately $556,000 . Interest rate swaps activity recorded in Other comprehensive (loss) earnings before tax includes the following: Three Months Ended Nine Months Ended ($ in thousands) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Unrealized (loss) gain $ $ $ $ Realized gain reclassified to interest expense $ $ $ $ Interest rate swaps included on the balance sheets are comprised of the following: As of September 27, December 31, ($ in thousands) 2015 2014 Accrued liabilities $ $ Other long-term obligations $ $ |
Other Comprehensive (Loss) Inco
Other Comprehensive (Loss) Income | 9 Months Ended |
Sep. 27, 2015 | |
Other Comprehensive (Loss) Earnings | |
Other Comprehensive Income | NOTE 11 – Other Comprehensive (Loss) Earnings Shareholders’ equity includes certain items classified as Accumulated other comprehensive (loss) income (“AOCI”) in the Consolidated Balance Sheets, including: · Unrealized gains (losses) on hedges relate to interest rate swaps to convert the line of credit’s variable rate of interest into a fixed rate. These hedges are designated as cash flow hedges, and CTS has deferred income statement recognition of gains and losses until the hedged transaction occurs. Amounts reclassified to income from AOCI for hedges are included in interest expense. Further information related to CTS’ interest rate swaps is included in NOTE 10 – Debt and NOTE 14 – Fair Value Measurements. · Unrealized gains (losses) on pension obligations are deferred from income statement recognition until the gains or losses are realized. Amounts reclassified to income from AOCI are included in net periodic pension expense. Further information related to CTS’ pension obligations is included in NOTE 5 – Retirement Plans. · Cumulative translation adjustment relates to our non-U.S. subsidiary companies that have designated a functional currency other than the U.S. dollar. CTS is required to translate the subsidiary functional currency financial statements to dollars using a combination of historical, period-end, and average foreign exchange rates. This combination of rates creates the foreign currency translation adjustment component of other comprehensive (loss) income. Changes in exchange rates between the functional currency and the currency in which a transaction is denominated is a foreign exchange transaction gain or loss. Transaction loss for the nine month period ended September 27, 2015 was $4,640,000 which is included in Other in the Condensed Consolidated Statement of (Loss) Earnings. The components of other comprehensive (loss) income for the three months ended September 27, 2015 are as follows: Gain (Loss) As of Gain (Loss) reclassified As of June 28, Recognized from AOCI September 27, ($ in thousands) 2015 in OCI to income 2015 Changes in fair market value of hedges: Gross $ $ $ $ Income tax (benefit) Net Changes in unrealized pension cost: Gross — Income tax (benefit) — Net — Cumulative translation adjustment: Gross — Income tax (benefit) — Net — Total accumulated other comprehensive (loss) income $ $ $ $ The components of other comprehensive (loss) income for the three months ended September 28, 2014 are as follows: Gain (Loss) As of Gain (Loss) reclassified As of June 29, Recognized from AOCI September 28, ($ in thousands) 2014 in OCI to income 2014 Changes in fair market value of hedges: Gross $ $ $ $ Income tax (benefit) Net Changes in unrealized pension cost: Gross — Income tax (benefit) — Net — Cumulative translation adjustment: Gross — Income tax (benefit) — Net — Total accumulated other comprehensive (loss) income $ $ $ $ The components of other comprehensive (loss) income for the nine months ended September 27, 2015 are as follows: Gain (Loss) As of Gain (Loss) reclassified As of December 31, Recognized from AOCI September 27, ($ in thousands) 2014 in OCI to income 2015 Changes in fair market value of hedges: Gross $ $ $ $ Income tax (benefit) Net Changes in unrealized pension cost: Gross — Income tax (benefit) — Net — Cumulative translation adjustment: Gross — Income tax (benefit) — Net — Total accumulated other comprehensive (loss) income $ $ $ $ The components of other comprehensive (loss) income for the nine months ended September 28, 2014 are as follows: Gain (Loss) As of Gain (Loss) reclassified As of December 31, Recognized from AOCI September 28, ($ in thousands) 2013 in OCI to income 2014 Changes in fair market value of hedges: Gross $ $ $ $ Income tax (benefit) Net Changes in unrealized pension cost: Gross Income tax (benefit) Net Cumulative translation adjustment: Gross — Income tax (benefit) — Net — Total accumulated other comprehensive (loss) income $ $ $ $ |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 27, 2015 | |
Stockholders' Equity | |
Shareholders' Equity | NOTE 12 – Shareholders’ Equity Share count and par value data related to shareholders’ equity are as follows: As of September 27, December 31, 2015 2014 Preferred Stock Par value per share No par value No par value Shares authorized Shares outstanding — — Common Stock Par value per share No par value No par value Shares authorized Shares issued Shares outstanding Treasury stock Shares held CTS uses the cost method to account for its common stock purchases. During the nine month period ended September 27, 2015 , CTS purchased 851,882 shares of common stock for an aggregate of $15,623,000 under a board-authorized share repurchase plan. For the nine month period ended September 28, 2014 , CTS purchased 288,382 shares of common stock for an aggregate of $5,084,000 . Approximately 9,742,922 shares are available for future issuances. A roll forward of common shares outstanding is as follows: Nine Months Ended September 27, 2015 September 28, 2014 Balance at the beginning of the year Repurchases Shares issued upon exercise of stock options Restricted share issuances Balance at the end of the period |
Equity-Based Compensation
Equity-Based Compensation | 9 Months Ended |
Sep. 27, 2015 | |
Equity-Based Compensation | |
Equity-Based Compensation | NOTE 13 - Equity-Based Compensation At September 27, 2015 , CTS had five equity-based compensation plans: the 2001 Stock Option Plan (“2001 Plan”), the Nonemployee Directors’ Stock Retirement Plan (“Directors’ Plan”), the 2004 Omnibus Long-Term Incentive Plan (“2004 Plan”), the 2009 Omnibus Equity and Performance Incentive Plan (“2009 Plan”), and the 2014 Performance & Incentive Plan (“2014 Plan”). Future grants can only be made under the 2014 Plan. The 2009 Plan, and previously the 2001 Plan and 2004 Plan, provides for grants of incentive stock options or nonqualified stock options to officers, key employees, and nonemployee members of CTS’ Board of Directors. In addition, the 2014 Plan, the 2009 Plan and the 2004 Plan allow for grants of stock appreciation rights, restricted stock, RSUs, performance shares, performance units, and other stock awards. The following table summarizes the compensation expense included in Selling, general and administrative expenses in the Consolidated Statements of Earnings related to equity-based compensation plans: Three Months Ended Nine Months Ended ($ in thousands) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Service-Based RSUs $ $ $ $ Performance-Based RSUs Market-Based RSUs Total $ $ $ $ Income tax benefit $ $ $ $ The following table summarizes the unrecognized compensation expense related to non-vested RSUs by type and the weighted-average period in which the expense is to be recognized: Unrecognized compensation Weighted- expense at average ($ in thousands) September 27, 2015 period Service-Based RSUs $ years Performance-Based RSUs years Market-Based RSUs years Total $ CTS recognizes expense on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was, in substance, multiple awards. The following table summarizes the status of these plans as of September 27, 2015 : 2014 Plan 2009 Plan 2004 Plan 2001 Plan Awards originally available Stock options outstanding — — — — RSUs outstanding — Options exercisable — — — — Awards available for grant — Stock Options Stock options are exercisable in cumulative annual installments over a maximum 10 -year period, commencing at least one year from the date of grant. Stock options are generally granted with an exercise price equal to the market price of CTS’ stock on the date of grant. The stock options generally vest over four years and have a 10 -year contractual life. The awards generally contain provisions to either accelerate vesting or allow vesting to continue on schedule upon retirement if certain service and age requirements are met. The awards also provide for accelerated vesting if there is a change in control event. CTS estimated the fair value of the stock option on the grant date using the Black-Scholes option-pricing model and assumptions for expected price volatility, option term, risk-free interest rate, and dividend yield. Expected price volatilities were based on historical volatilities of CTS’ common stock. The expected option term is derived from historical data on exercise behavior. The dividend yield was based on historical dividend payments. The risk-free rate for periods within the contractual life of the option was based on the U.S. Treasury yield curve in effect at the time of grant. A summary of the status of stock options as of September 27, 2015 , and changes during the period then ended, is presented below: Nine Months Ended September 27, 2015 Weighted Average Exercise Options Price Outstanding at beginning of year $ Exercised $ Outstanding at end of period — $ — Exercisable at end of period — $ — Performance-Based Stock Options During the second quarter of 2015, the Compensation Committee of the Board of Directors of the Company (the “Committee”) granted a total of 430,000 performance-based stock option awards (“Performance-Based Option Awards”) for certain CTS employees under the 2014 Plan. The Performance-Based Option Awards, which have a grant date of May 26, 2015 and a grant date fair value of $18.37 , are subject to the terms of the 2014 Plan. The Performance-Based Option Awards generally have a term of five years and generally will become exercisable (provided the optionee remains employed by CTS or an affiliate) upon CTS’ attainment of at least $600,000,000 in revenues during any of CTS’ four -fiscal-quarter trailing periods (as determined by the Committee) during the term. CTS has not recognized any expense on these Performance-Based Option Awards for the nine months ended September 27, 2015 since the revenue target is not likely to be attained, based upon the CTS’ earnings history and forecast, at this time. Service-Based Restricted Stock Units Service-based RSUs entitle the holder to receive one share of common stock for each unit when the unit vests. RSUs are issued to officers, key employees and non-employee directors as compensation. Generally, the RSUs vest over a three -year period. RSUs granted to non-employee directors vest one month after granted. Upon vesting, the non-employee directors elect to either receive the stock associated with the RSU immediately, or defer receipt of the stock until their retirement from the Board of Directors. The fair value of the RSUs is equivalent to the trading value of CTS’ common stock on the grant date. A summary of the status of RSUs is presented below: Nine Months Ended September 27, 2015 Weighted Average Grant Date Units Fair Value Outstanding at January 1, 2015 $ Granted Converted Forfeited Outstanding at September 27, 2015 $ Performance-Based Restricted Stock Units CTS grants performance-based restricted stock unit awards for certain executives. Vesting may occur in the range from zero percent to 200% of the target amount. Vesting is subject to certification of the fiscal results of the year prior to the target year by CTS’ independent auditors. Vesting is dependent upon CTS’ achievement of either sales growth targets or cash flow targets as noted in the table below. Performance-Based RSUs include the following components: Target Vesting Vesting Units Grant Date Units Year Dependency Awarded February 11, 2013 2016 Sales growth — February 11, 2013 2016 Cash flow — February 14, 2014 2017 Sales growth — February 14, 2014 2017 Cash flow — February 13, 2015 2018 Sales growth — February 13, 2015 2018 Cash flow — Market-Based Restricted Stock Units CTS grants market-based restricted stock unit awards for certain executives and key employees. Vesting may occur in the range from zero percent to 200% of the target amount. Vesting is subject to certification of the fiscal results of the year prior to the target year by CTS’ independent auditors. The vesting rate will be determined using a matrix based on a percentile ranking of CTS total stockholder return with peer group total shareholder return over a three -year period. Vesting is tied exclusively to CTS total stockholder return relative to peer group companies’ total stockholder return rates. Market-Based RSUs include the following components: Number of Target Vesting Peer Group Units Grant Date Units Year Companies Awarded February 11, 2013 — February 11, 2013 — February 14, 2014 — February 13, 2015 — |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 27, 2015 | |
Fair Value Measurements | |
Fair Value Measurements | NOTE 14 — Fair Value Measurements CTS uses interest rate swaps to convert the line of credit’s variable rate of interest into a fixed rate. The interest rate swaps are measured at fair value on a recurring basis. The table below summarizes CTS’ financial liability that was measured at fair value as of three month period September 27, 2015 and the loss recorded during the nine month period ended September 27, 2015 : Quoted Prices in Active Significant Carrying Markets for Other Significant Loss for Value at Identical Observable Unobservable Nine Months Ended September 27, Instruments Inputs Inputs September 27, ($ in thousands) 2015 (Level 1) (Level 2) (Level 3) 2015 Interest rate swap – cash flow hedge $ $ — $ $ — $ The table below summarizes the financial liability that was measured at fair value on a recurring basis as of December 31, 2014 and the loss recorded during the year ended December 31, 2014 : Quoted Prices in Active Significant Carrying Markets for Other Significant Loss for Value at Identical Observable Unobservable Year Ended December 31, Instruments Inputs Inputs December 31, ($ in thousands) 2014 (Level 1) (Level 2) (Level 3) 2014 Interest rate swap – cash flow hedge $ $ — $ $ — $ The fair value of CTS’ interest rate swaps were measured using a market approach which uses current industry information. There is a readily determinable market and these swaps are classified within level 2 of the fair value hierarchy. The table below provides a reconciliation of the recurring financial liability related to interest rate swaps: Interest ($ in thousands) Rate Swaps Balance at January 1, 2014 $ Total gains (losses) for the period: Included in earnings Included in other comprehensive earnings Balance at December 31, 2014 $ Total gains (losses) for the period: Included in earnings Included in other comprehensive earnings Balance at September 27, 2015 $ CTS’ long-term debt consists of a revolving credit facility which is recorded at its carrying value. There is a readily determinable market for CTS’ revolving credit debt and it is classified within Level 2 of the fair value hierarchy as the market is not deemed to be active. The fair value of long-term debt was measured using a market approach which uses current industry information and approximates carrying value. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 27, 2015 | |
Income Taxes | |
Income Taxes | NOTE 15 — Income Taxes The effective tax rates for 2015 and 2014 are as follows: Three Months Ended Nine Months Ended September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Effective tax rate % % % % The 2015 effective tax rate for the three months ended September 27, 2015 reflects the change in the mix of earnings by jurisdiction as well as the impact of true ups related to the filing of 2014 tax returns. For the nine months ended September 27, 2015, the effect of the uncertain tax benefits increased the effective tax rate by 42.9 percentage points and the effect of amending the tax returns for 2006 to 2013 decreased the effective rate by 122.1 percentage points The 2014 effective tax rate reflected higher profits, primarily from a change in the mix of earnings by jurisdiction, and the effect of tax adjustments which decreased the effective rate by 3.3 percentage points in the third quarter of 2014 and increased the effective rate by 0.4 percentage points in the first nine months of 2014. CTS’ continuing practice is to recognize interest and/or penalties related to income tax matters as income tax expense. For the three and nine months ended September 27, 2015 and September 28, 2014 , CTS included $136,000 and $957,000 of interest or penalties in income tax expense. CTS did not accrue any interest or penalties into income tax expense for the three and nine months ended September 28, 2014. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 27, 2015 | |
Recent Accounting Pronouncements | |
Recent Accounting Pronouncements | NOTE 16 — Recent Accounting Pronouncements ASU 2015-16. “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments” In September 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-16, "Business Combinations (Topic 805) Simplifying the Accounting for Measurement-Period Adjustments of Inventory". The amendments clarify that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The acquirer needs to record, in the same period’s financial statements, the effect of changes in depreciation, amortization, or other income as a result of the change to the provisional amounts as if the accounting had been completed at the acquisition date. This amendment requires an entity to present separately on the face of the income statement or disclose in the notes the portion of the amount recorded in current period earnings by line item as if the provisional adjustments had been recognized as of the acquisition date. This ASU is effective for fiscal years beginning after December 15, 2015 including interim periods within those fiscal years. These provisions are not anticipated to have a material impact on our financial statements. ASU 2015-11. “Inventory (Topic 330): Simplifying the Measurement of Inventory” In July 2015, the FASB issued ASU 2015-11, "Inventory (Topic 330) Simplifying the Measurement of Inventory". The amendments clarify that an entity should measure inventory within the scope of this update at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Substantial and unusual losses that result from subsequent measurement of inventory should be disclosed in the financial statements. This ASU is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The amendments are to be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting period. These provisions are not anticipated to have a material impact on our financial statements. ASU 2015-08, “ Business Combinations (Topic 805): Pushdown Accounting – amendments to SEC Paragraphs Pursuant to Staff Accounting Bulletin No. 115 ” In May 2015, the FASB issued ASU 2015-08, “Business Combinations (Topic 805): Pushdown Accounting – amendments to SEC Paragraphs Pursuant to Staff Accounting Bulletin No. 115”. This ASU amends various SEC paragraphs included in the FASB’s ASC to reflect the issuance of Staff Accounting Bulletin (“SAB”) No. 115. SAB 115 rescinds portions of the interpretive guidance included in the SEC’s Staff Accounting Bulletin series and brings existing guidance into conformity with ASU 2014-17, Pushdown Accounting, which provides an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. An acquired entity is not only able to apply this amendment to change in control events occurring after the effective date, but is also permitted to apply pushdown accounting as a change in accounting principle to its most recent change in control event that had occurred before the effective date of this new amendment. The decision to apply pushdown accounting to a specific change in control event, if elected by an acquiree, is irrevocable. The amendment also amends the reporting for a bargain purchase option. The acquired entity would not report a gain in its income statement as a result of a bargain purchase. Rather, the acquiree shall recognize the bargain purchase gain recognized by the acquirer as an adjustment to additional paid-in capital. This amendment is effective immediately. This amendment does not have a material impact on our financial statements. ASU 2015-07, “ Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent) ” In May 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) 2015-07, “Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)”. This ASU permits a reporting entity, as a practical expedient, to measure the fair value of certain investments using the net asset value per share of the investment. This amendment applies to reporting entities that elect to measure the fair value of an investment within the scope of paragraphs 820-10-15-4 through 15-5 using the net asset value per share (or its equivalent) practical expedient in paragraph 820-10-35-59. This amendment removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. It also removes the requirement to make certain disclosures for all investments that are eligible to be measured at fair value using the net asset value per share practical expedient. Rather, those disclosures are limited to investments for which the entity has elected to measure the fair value using that practical expedient. The amendments will be effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2015. Early adoption is permitted. An entity should apply the amendments retrospectively to all periods presented. The retrospective approach requires that an investment for which fair value is measured using the net asset value per share practical expedient be removed from the fair value hierarchy in all periods presented in an entity’s financial statements. These provisions are not anticipated to have a material impact on our financial statements. ASU 2015-04, “ Compensation – Retirement Benefits (Topic 715): Practical Expedient for the Measurement Date of an Employer’s Benefit Obligation and Plan Assets ” In April 2015, FASB issued ASU 2015-04, “Compensation –Retirement Benefits (Topic 715): Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets”. The amended guidance permits companies to use a practical expedient which allows an employer to measure defined benefit plan assets and obligations as of the month-end date that is closest to the employer’s fiscal year-end (alternative measurement date). An employer using this policy election must apply it consistently to all of its defined benefit plans. In accordance with this ASU, an employer using the practical expedient is required to adjust the funded status for contributions and other significant events (as defined in paragraph 715-30-35-66) occurring between the alternative measurement date and its fiscal year-end. Paragraph 715-30-35-66 defines a significant event as: a plan amendment, settlement, or curtailment that calls for remeasurement. This ASU also allows employers the use of the practical expedient in interim remeasurements of significant events. The employer would be required to disclose the election to use the practical expedient and the measurement date of the plan assets and obligations. Early application of this ASU is permitted. Entities must apply the guidance prospectively. The guidance is effective for financial statements for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. The changes would be effective for employee benefit plans for financial statements issued for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. These provisions are not anticipated to have a material impact on our financial statements. ASU 2015-05, “ Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement ” In April 2015, the FASB issued ASU 2015-05, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40) Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement”. The amendments in this ASU provide guidance to customers about a customer’s accounting for fees paid in a cloud computing arrangement. This ASU clarifies that if a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The guidance will not change U.S. GAAP for a customer’s accounting for service contracts. All software licenses within the scope of Subtopic 350-40 will be accounted for consistent with other licenses of intangible assets. The amendments will be effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2015. Early adoption is permitted. An entity can elect to adopt the amendments either prospectively to all arrangements entered into or materially modified after the effective date or retrospectively. For prospective transition, the disclosure requirements at transition include the nature of and reason for the change in accounting principle, the transition method, and a qualitative description of the financial statement line items affected by the change. For retrospective transition, the disclosure requirements at transition include the requirements for prospective transition and quantitative information about the effects of the accounting change. These provisions are not anticipated to have a material impact on our financial statements. ASU 2015-03, “ Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs ” In April 2015, the FASB issued ASU 2015-03, “Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs”. The amended guidance require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. The amendments in this ASU are effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption of this ASU is permitted for financial statements that have not been previously issued. Entities must apply the new guidance on a retrospective basis, wherein the balance sheet of each individual period presented should be adjusted to reflect the period-specific effects of applying the new guidance. Upon transition, an entity is required to comply with the applicable disclosures for a change in an accounting principle. These provisions are not anticipated to have a material impact on our financial statements. ASU 2014-12, “ Compensation – Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period ” In June 2014, the FASB issued ASU 2014-12, “ Compensation — Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period” . The amended guidance requires that a performance target that affects vesting and that could be achieved after the requisite service period should be treated as a performance condition. Current U.S. GAAP does not contain explicit guidance on whether to treat a performance target that could be achieved after the requisite service period as a performance condition that affects vesting or as a nonvesting condition that affects the grant-date fair value of an award. The amendments in this update provide explicit guidance for those awards. The amendments are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. Entities may apply the amendments either prospectively to all awards granted or modified after the effective date, or retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. These provisions are not anticipated to have a material impact on our financial statements. ASU 2014-09, “ Revenue from Contracts with Customers ” In May 2014, the FASB issued ASU 2014-09, “ Revenue from Contracts with Customers” . The guidance in this ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets unless those contracts are within the scope of other standards (for example, insurance contracts or lease contracts). The new revenue recognition guidance more closely aligns U.S. GAAP with International Financial Reporting Standards ("IFRS"). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. The guidance is effective for annual periods beginning on or after December 15, 2017 and interim periods within that reporting period. Early adoption is permitted provided that it is not before the original effective date of December 15, 2016. These provisions of this guidance are still being evaluated. The impact on CTS' financial statements has not yet been determined. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 27, 2015 | |
Recent Accounting Pronouncements | |
Basis of Presentation | The accompanying condensed consolidated financial statements have been prepared by CTS Corporation (“CTS” or “the Company”), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations. The unaudited condensed consolidated financial statements should be read in conjunction with the financial statements, notes thereto, and other information included in the Company’s Annual Report on Form 10 ‑K for the year ended December 31, 2014 . The accompanying unaudited condensed consolidated financial statements reflect, in the opinion of management, all adjustments (consisting of normal recurring items) necessary for a fair statement, in all material respects, of the financial position and results of operations for the periods presented. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ materially from those estimates. The results of operations for the interim periods are not necessarily indicative of the results for the entire year. Reclassifications Certain reclassifications have been made for the prior periods presented in the Unaudited Condensed Consolidated Statements of Cash Flows to conform to the current period’s presentation. |
Reclassifications | Reclassifications Certain reclassifications have been made for the prior periods presented in the Unaudited Condensed Consolidated Statements of Cash Flows to conform to the current period’s presentation. |
Recent Accounting Pronounceme23
Recent Accounting Pronouncements (Policies) | 9 Months Ended |
Sep. 27, 2015 | |
Recent Accounting Pronouncements | |
Recent Accounting Pronouncements | ASU 2015-11. “Inventory (Topic 330): Simplifying the Measurement of Inventory” In July 2015, the FASB issued ASU 2015-11, "Inventory (Topic 330) Simplifying the Measurement of Inventory". The amendments clarify that an entity should measure inventory within the scope of this update at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Substantial and unusual losses that result from subsequent measurement of inventory should be disclosed in the financial statements. This ASU is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The amendments are to be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting period. These provisions are not anticipated to have a material impact on our financial statements. ASU 2015-08, “ Business Combinations (Topic 805): Pushdown Accounting – amendments to SEC Paragraphs Pursuant to Staff Accounting Bulletin No. 115 ” In May 2015, the FASB issued ASU 2015-08, “Business Combinations (Topic 805): Pushdown Accounting – amendments to SEC Paragraphs Pursuant to Staff Accounting Bulletin No. 115”. This ASU amends various SEC paragraphs included in the FASB’s ASC to reflect the issuance of Staff Accounting Bulletin (“SAB”) No. 115. SAB 115 rescinds portions of the interpretive guidance included in the SEC’s Staff Accounting Bulletin series and brings existing guidance into conformity with ASU 2014-17, Pushdown Accounting, which provides an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. An acquired entity is not only able to apply this amendment to change in control events occurring after the effective date, but is also permitted to apply pushdown accounting as a change in accounting principle to its most recent change in control event that had occurred before the effective date of this new amendment. The decision to apply pushdown accounting to a specific change in control event, if elected by an acquiree, is irrevocable. The amendment also amends the reporting for a bargain purchase option. The acquired entity would not report a gain in its income statement as a result of a bargain purchase. Rather, the acquiree shall recognize the bargain purchase gain recognized by the acquirer as an adjustment to additional paid-in capital. This amendment is effective immediately. This amendment does not have a material impact on our financial statements. ASU 2015-07, “ Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent) ” In May 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) 2015-07, “Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)”. This ASU permits a reporting entity, as a practical expedient, to measure the fair value of certain investments using the net asset value per share of the investment. This amendment applies to reporting entities that elect to measure the fair value of an investment within the scope of paragraphs 820-10-15-4 through 15-5 using the net asset value per share (or its equivalent) practical expedient in paragraph 820-10-35-59. This amendment removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. It also removes the requirement to make certain disclosures for all investments that are eligible to be measured at fair value using the net asset value per share practical expedient. Rather, those disclosures are limited to investments for which the entity has elected to measure the fair value using that practical expedient. The amendments will be effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2015. Early adoption is permitted. An entity should apply the amendments retrospectively to all periods presented. The retrospective approach requires that an investment for which fair value is measured using the net asset value per share practical expedient be removed from the fair value hierarchy in all periods presented in an entity’s financial statements. These provisions are not anticipated to have a material impact on our financial statements. ASU 2015-04, “ Compensation – Retirement Benefits (Topic 715): Practical Expedient for the Measurement Date of an Employer’s Benefit Obligation and Plan Assets ” In April 2015, FASB issued ASU 2015-04, “Compensation –Retirement Benefits (Topic 715): Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets”. The amended guidance permits companies to use a practical expedient which allows an employer to measure defined benefit plan assets and obligations as of the month-end date that is closest to the employer’s fiscal year-end (alternative measurement date). An employer using this policy election must apply it consistently to all of its defined benefit plans. In accordance with this ASU, an employer using the practical expedient is required to adjust the funded status for contributions and other significant events (as defined in paragraph 715-30-35-66) occurring between the alternative measurement date and its fiscal year-end. Paragraph 715-30-35-66 defines a significant event as: a plan amendment, settlement, or curtailment that calls for remeasurement. This ASU also allows employers the use of the practical expedient in interim remeasurements of significant events. The employer would be required to disclose the election to use the practical expedient and the measurement date of the plan assets and obligations. Early application of this ASU is permitted. Entities must apply the guidance prospectively. The guidance is effective for financial statements for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. The changes would be effective for employee benefit plans for financial statements issued for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. These provisions are not anticipated to have a material impact on our financial statements. ASU 2015-05, “ Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement ” In April 2015, the FASB issued ASU 2015-05, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40) Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement”. The amendments in this ASU provide guidance to customers about a customer’s accounting for fees paid in a cloud computing arrangement. This ASU clarifies that if a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The guidance will not change U.S. GAAP for a customer’s accounting for service contracts. All software licenses within the scope of Subtopic 350-40 will be accounted for consistent with other licenses of intangible assets. The amendments will be effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2015. Early adoption is permitted. An entity can elect to adopt the amendments either prospectively to all arrangements entered into or materially modified after the effective date or retrospectively. For prospective transition, the disclosure requirements at transition include the nature of and reason for the change in accounting principle, the transition method, and a qualitative description of the financial statement line items affected by the change. For retrospective transition, the disclosure requirements at transition include the requirements for prospective transition and quantitative information about the effects of the accounting change. These provisions are not anticipated to have a material impact on our financial statements. ASU 2015-03, “ Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs ” In April 2015, the FASB issued ASU 2015-03, “Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs”. The amended guidance require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. The amendments in this ASU are effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption of this ASU is permitted for financial statements that have not been previously issued. Entities must apply the new guidance on a retrospective basis, wherein the balance sheet of each individual period presented should be adjusted to reflect the period-specific effects of applying the new guidance. Upon transition, an entity is required to comply with the applicable disclosures for a change in an accounting principle. These provisions are not anticipated to have a material impact on our financial statements. ASU 2014-12, “ Compensation – Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period ” In June 2014, the FASB issued ASU 2014-12, “ Compensation — Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period” . The amended guidance requires that a performance target that affects vesting and that could be achieved after the requisite service period should be treated as a performance condition. Current U.S. GAAP does not contain explicit guidance on whether to treat a performance target that could be achieved after the requisite service period as a performance condition that affects vesting or as a nonvesting condition that affects the grant-date fair value of an award. The amendments in this update provide explicit guidance for those awards. The amendments are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. Entities may apply the amendments either prospectively to all awards granted or modified after the effective date, or retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. These provisions are not anticipated to have a material impact on our financial statements. ASU 2014-09, “ Revenue from Contracts with Customers ” In May 2014, the FASB issued ASU 2014-09, “ Revenue from Contracts with Customers” . The guidance in this ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets unless those contracts are within the scope of other standards (for example, insurance contracts or lease contracts). The new revenue recognition guidance more closely aligns U.S. GAAP with International Financial Reporting Standards ("IFRS"). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. The guidance is effective for annual periods beginning on or after December 15, 2017 and interim periods within that reporting period. Early adoption is permitted provided that it is not before the original effective date of December 15, 2016. These provisions of this guidance are still being evaluated. The impact on CTS' financial statements has not yet been determined. |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Accounts Receivable | |
Components of Accounts Receivable | As of September 27, December 31, ($ in thousands) 2015 2014 Accounts receivable, gross $ $ Less: Allowance for doubtful accounts Accounts receivable, net $ $ |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Inventories | |
Summary of Inventories | As of September 27, December 31, ($ in thousands) 2015 2014 Finished goods $ $ Work-in-process Raw materials Less: Inventory reserves Inventories, net $ $ |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Property, Plant and Equipment. | |
Summary of Property, Plant and Equipment | As of September 27, December 31, ($ in thousands) 2015 2014 Land $ $ Buildings and improvements Machinery and equipment Less: Accumulated depreciation Property, plant and equipment, net $ $ |
Retirement Plans (Tables)
Retirement Plans (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Retirement Plans | |
Net Pension Income or Postretirement Expense | Net pension income for our domestic and foreign plans was as follows: Three Months Ended Nine Months Ended ($ in thousands) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Net pension income $ $ $ $ Net pension (income) expense breakdown for our domestic and foreign plans include the following components: Domestic Pension Plans Foreign Pension Plans Three months: Three Months Ended Three Months Ended ($ in thousands) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Service cost $ $ $ $ Interest cost Expected return on plan assets (1) Amortization of loss Other cost due to retirement — — — — (Income) expense, net $ $ $ $ Domestic Pension Plans Foreign Pension Plans Nine months: Nine Months Ended Nine Months Ended ($ in thousands ) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Service cost $ $ $ $ Interest cost Expected return on plan assets (1) Amortization of loss Other cost due to retirement — — — (Income) expense, net $ $ $ $ (1) Expected return on plan assets is net of expected investment expenses and certain administrative expenses. Other Postretirement Benefit Plan Net postretirement expense for our postretirement plan includes the following components: Three Months Ended Nine Months Ended ($ in thousands) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Other postretirement benefit plan Service cost $ $ $ $ Interest cost Amortization of gain Postretirement expense $ $ $ $ |
Other Intangible Assets (Tables
Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Other Intangible Assets. | |
Summary of other intangible assets | As of September 27, 2015 ($ in thousands) Gross Carrying Amount Accumulated Amortization Net Amount Amortized intangible assets: Customer lists/relationships $ $ $ Patents — Other intangibles Other intangible assets, net $ $ $ Amortization expense for the three months ended September 27, 2015 $ Amortization expense for the nine months ended September 27, 2015 $ As of December 31, 2014 ($ in thousands) Gross Carrying Amount Accumulated Amortization Net Amount Amortized intangible assets: Customer lists/relationships $ $ $ Patents — Other intangibles Other intangible assets, net $ $ $ Amortization expense for the three months ended September 28, 2014 $ Amortization expense for the nine months ended September 28, 2014 $ |
Summary of amortization expense remaining for other intangible assets | ($ in thousands) Amortization expense 2015 $ 2016 2017 2018 2019 Thereafter Total amortization expense $ |
Costs Associated with Exit an29
Costs Associated with Exit and Restructuring Activities (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Restructuring Reserve Activity | ($ in thousands ) June 2013 Plan and April 2014 Plan Restructuring liability at January 1, 2015 $ Restructuring and restructuring-related charges, excluding asset impairments and write-offs Cost paid Restructuring liability at September 27, 2015 $ |
June 2013 Plan and April 2014 Plan | |
Restructuring and Restructuring Related Charges of Actual Costs | Three Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ $ Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ Nine Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ $ Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ |
April 2014 Plan | |
Restructuring and Restructuring Related Charges of Actual Costs | Three Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ $ — Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ Nine Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ $ — Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ |
Schedule of Planned and Actual Costs Incurred to Date | Actual costs Planned incurred through ($ in thousands) April 2014 Plan Costs September 27, 2015 Inventory write-down $ $ — Equipment relocation Other charges Restructuring related charges, included in cost of goods sold $ $ Workforce reduction $ $ Asset impairment charge — — Other charges, including pension termination costs Restructuring and impairment charges $ $ Total restructuring, impairment and restructuring related charges $ $ |
June 2013 Plan | |
Restructuring and Restructuring Related Charges of Actual Costs | Three Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ — $ Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ Nine Months Ended September 27, September 28, ($ in thousands) 2015 2014 Restructuring related charges $ $ Restructuring and impairment charges Total restructuring, impairment, and restructuring related charges $ $ |
Schedule of Planned and Actual Costs Incurred to Date | Planned Actual costs incurred through ($ in thousands) June 2013 Plan Costs September 27, 2015 Inventory write-down $ $ Equipment relocation Other charges Restructuring-related charges, included in cost of goods sold $ $ Workforce reduction $ $ Asset impairment charge Other charges, including pension termination costs Restructuring and impairment charges $ $ Total restructuring and restructuring-related charges $ $ |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Accrued Liabilities. | |
Components of Accrued Liabilities | As of September 27, December 31, ($ in thousands) 2015 2014 Accrued product related costs $ $ Accrued income taxes Accrued property and other taxes Dividends payable Remediation and monitoring reserves Other accrued liabilities Total accrued liabilities $ $ |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Debt | |
Summary of Long-Term Debt | As of September 27, December 31, ($ in thousands) 2015 2014 Revolving credit facility due in 2020 $ $ Weighted average interest rate % % Amount available $ $ Total credit facility $ $ Standby letters of credit $ $ Commitment fee percentage per annum |
Summary of Interest Rate Swaps Activity Recorded in Other Comprehensive Income Before Tax | Three Months Ended Nine Months Ended ($ in thousands) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Unrealized (loss) gain $ $ $ $ Realized gain reclassified to interest expense $ $ $ $ |
Summary of Interest Rate Swaps Included on Balance Sheets | As of September 27, December 31, ($ in thousands) 2015 2014 Accrued liabilities $ $ Other long-term obligations $ $ |
Other Comprehensive (Loss) In32
Other Comprehensive (Loss) Income (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Other Comprehensive (Loss) Earnings | |
Changes in components of other comprehensive (loss) income | The components of other comprehensive (loss) income for the three months ended September 27, 2015 are as follows: Gain (Loss) As of Gain (Loss) reclassified As of June 28, Recognized from AOCI September 27, ($ in thousands) 2015 in OCI to income 2015 Changes in fair market value of hedges: Gross $ $ $ $ Income tax (benefit) Net Changes in unrealized pension cost: Gross — Income tax (benefit) — Net — Cumulative translation adjustment: Gross — Income tax (benefit) — Net — Total accumulated other comprehensive (loss) income $ $ $ $ The components of other comprehensive (loss) income for the three months ended September 28, 2014 are as follows: Gain (Loss) As of Gain (Loss) reclassified As of June 29, Recognized from AOCI September 28, ($ in thousands) 2014 in OCI to income 2014 Changes in fair market value of hedges: Gross $ $ $ $ Income tax (benefit) Net Changes in unrealized pension cost: Gross — Income tax (benefit) — Net — Cumulative translation adjustment: Gross — Income tax (benefit) — Net — Total accumulated other comprehensive (loss) income $ $ $ $ The components of other comprehensive (loss) income for the nine months ended September 27, 2015 are as follows: Gain (Loss) As of Gain (Loss) reclassified As of December 31, Recognized from AOCI September 27, ($ in thousands) 2014 in OCI to income 2015 Changes in fair market value of hedges: Gross $ $ $ $ Income tax (benefit) Net Changes in unrealized pension cost: Gross — Income tax (benefit) — Net — Cumulative translation adjustment: Gross — Income tax (benefit) — Net — Total accumulated other comprehensive (loss) income $ $ $ $ The components of other comprehensive (loss) income for the nine months ended September 28, 2014 are as follows: Gain (Loss) As of Gain (Loss) reclassified As of December 31, Recognized from AOCI September 28, ($ in thousands) 2013 in OCI to income 2014 Changes in fair market value of hedges: Gross $ $ $ $ Income tax (benefit) Net Changes in unrealized pension cost: Gross Income tax (benefit) Net Cumulative translation adjustment: Gross — Income tax (benefit) — Net — Total accumulated other comprehensive (loss) income $ $ $ $ |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Stockholders' Equity | |
Summary of Share Count and Par Value Data Related to Shareholders' Equity | As of September 27, December 31, 2015 2014 Preferred Stock Par value per share No par value No par value Shares authorized Shares outstanding — — Common Stock Par value per share No par value No par value Shares authorized Shares issued Shares outstanding Treasury stock Shares held |
Summary of Common Shares Outstanding | Nine Months Ended September 27, 2015 September 28, 2014 Balance at the beginning of the year Repurchases Shares issued upon exercise of stock options Restricted share issuances Balance at the end of the period |
Equity-Based compensation (Tabl
Equity-Based compensation (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Equity-Based Compensation | |
Summary of Equity-Based Compensation Expense | Three Months Ended Nine Months Ended ($ in thousands) September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Service-Based RSUs $ $ $ $ Performance-Based RSUs Market-Based RSUs Total $ $ $ $ Income tax benefit $ $ $ $ |
Schedule of Unrecognized Equity-Based Compensation Expense | Unrecognized compensation Weighted- expense at average ($ in thousands) September 27, 2015 period Service-Based RSUs $ years Performance-Based RSUs years Market-Based RSUs years Total $ |
Summary of Status of Equity-Based Compensation Plans | 2014 Plan 2009 Plan 2004 Plan 2001 Plan Awards originally available Stock options outstanding — — — — RSUs outstanding — Options exercisable — — — — Awards available for grant — |
Summary of Changes of Stock Options | Nine Months Ended September 27, 2015 Weighted Average Exercise Options Price Outstanding at beginning of year $ Exercised $ Outstanding at end of period — $ — Exercisable at end of period — $ — |
Summary of Service-Based Restricted Stock Units | Nine Months Ended September 27, 2015 Weighted Average Grant Date Units Fair Value Outstanding at January 1, 2015 $ Granted Converted Forfeited Outstanding at September 27, 2015 $ |
Schedule of Components of Performance-Based RSU's | Target Vesting Vesting Units Grant Date Units Year Dependency Awarded February 11, 2013 2016 Sales growth — February 11, 2013 2016 Cash flow — February 14, 2014 2017 Sales growth — February 14, 2014 2017 Cash flow — February 13, 2015 2018 Sales growth — February 13, 2015 2018 Cash flow — |
Schedule of Components of Market-Based RSU's | Number of Target Vesting Peer Group Units Grant Date Units Year Companies Awarded February 11, 2013 — February 11, 2013 — February 14, 2014 — February 13, 2015 — |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Fair Value Measurements | |
Summary of Financial Liability Measured at Fair Value on a Recurring Basis | The table below summarizes CTS’ financial liability that was measured at fair value as of three month period September 27, 2015 and the loss recorded during the nine month period ended September 27, 2015 : Quoted Prices in Active Significant Carrying Markets for Other Significant Loss for Value at Identical Observable Unobservable Nine Months Ended September 27, Instruments Inputs Inputs September 27, ($ in thousands) 2015 (Level 1) (Level 2) (Level 3) 2015 Interest rate swap – cash flow hedge $ $ — $ $ — $ The table below summarizes the financial liability that was measured at fair value on a recurring basis as of December 31, 2014 and the loss recorded during the year ended December 31, 2014 : Quoted Prices in Active Significant Carrying Markets for Other Significant Loss for Value at Identical Observable Unobservable Year Ended December 31, Instruments Inputs Inputs December 31, ($ in thousands) 2014 (Level 1) (Level 2) (Level 3) 2014 Interest rate swap – cash flow hedge $ $ — $ $ — $ |
Reconciliation of Recurring Financial Liability Related to Interest Rate Swaps | Interest ($ in thousands) Rate Swaps Balance at January 1, 2014 $ Total gains (losses) for the period: Included in earnings Included in other comprehensive earnings Balance at December 31, 2014 $ Total gains (losses) for the period: Included in earnings Included in other comprehensive earnings Balance at September 27, 2015 $ |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 27, 2015 | |
Income Taxes | |
Reconciliation of Effective Income Taxes Rate | Three Months Ended Nine Months Ended September 27, 2015 September 28, 2014 September 27, 2015 September 28, 2014 Effective tax rate % % % % |
Accounts Receivable - Component
Accounts Receivable - Components of Accounts Receivable (Details) - USD ($) $ in Thousands | Sep. 27, 2015 | Dec. 31, 2014 |
Accounts Receivable | ||
Accounts receivable, gross | $ 59,343 | $ 56,994 |
Less: Allowance for doubtful accounts | (130) | (100) |
Accounts receivable, net | $ 59,213 | $ 56,894 |
Inventories - Summary of Invent
Inventories - Summary of Inventories (Details) - USD ($) $ in Thousands | Sep. 27, 2015 | Dec. 31, 2014 |
Inventories | ||
Finished goods | $ 9,230 | $ 11,728 |
Work-in-process | 7,938 | 7,297 |
Raw materials | 15,746 | 15,562 |
Less: Inventory reserves | (5,940) | (6,700) |
Inventories, net | $ 26,974 | $ 27,887 |
Property, Plant and Equipment -
Property, Plant and Equipment - Summary of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Sep. 27, 2015 | Dec. 31, 2014 |
Property, plant and equipment | ||
Accumulated depreciation | $ (190,013) | $ (184,898) |
Net property, plant and equipment | 68,932 | 71,414 |
Land | ||
Property, plant and equipment | ||
Property, plant and equipment gross | 2,286 | 3,044 |
Buildings and improvements | ||
Property, plant and equipment | ||
Property, plant and equipment gross | 65,617 | 67,269 |
Machinery and equipment | ||
Property, plant and equipment | ||
Property, plant and equipment gross | $ 191,042 | $ 185,999 |
Retirement Plans - Net Pension
Retirement Plans - Net Pension Income or Postretirement Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 27, 2015 | Sep. 28, 2014 | Sep. 27, 2015 | Sep. 28, 2014 | |
Pension Plans | ||||
Net pension expense (income) | ||||
(Income) expense, net | $ (532) | $ (637) | $ (1,591) | $ (1,717) |
Domestic Pension Plans | ||||
Net pension expense (income) | ||||
Service cost | 42 | 48 | 128 | 144 |
Interest cost | 2,815 | 3,052 | 8,444 | 9,163 |
Expected return on plan assets | (5,068) | (5,209) | (15,204) | (15,625) |
Amortization of loss (gain) | 1,585 | 1,408 | 4,754 | 4,237 |
Other cost due to retirement | 172 | |||
(Income) expense, net | (626) | (701) | (1,878) | (1,909) |
Foreign Pension Plans | ||||
Net pension expense (income) | ||||
Service cost | 16 | 21 | 49 | 63 |
Interest cost | 124 | 156 | 371 | 461 |
Expected return on plan assets | (135) | (172) | (402) | (509) |
Amortization of loss (gain) | 89 | 59 | 269 | 177 |
(Income) expense, net | 94 | 64 | 287 | 192 |
Other Postretirement Benefit Plan | ||||
Net pension expense (income) | ||||
Service cost | 1 | 1 | 3 | 3 |
Interest cost | 51 | 57 | 153 | 172 |
Amortization of loss (gain) | (25) | (39) | (75) | (118) |
(Income) expense, net | $ 27 | $ 19 | $ 81 | $ 57 |
Other Intangible Assets - Summa
Other Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 27, 2015 | Sep. 28, 2014 | Sep. 27, 2015 | Sep. 28, 2014 | Dec. 31, 2014 | |
Other Intangible Assets | |||||
Gross Carrying Amount | $ 74,393 | $ 74,393 | $ 74,393 | ||
Accumulated Amortization | (41,433) | (41,433) | (38,491) | ||
Total amortization expense | 32,960 | 32,960 | 35,902 | ||
Amortization expense | 985 | $ 1,046 | 2,942 | $ 3,125 | |
Customer lists/relationships | |||||
Other Intangible Assets | |||||
Gross Carrying Amount | 51,804 | 51,804 | 51,804 | ||
Accumulated Amortization | (26,423) | (26,423) | (24,415) | ||
Total amortization expense | 25,381 | 25,381 | 27,389 | ||
Patents | |||||
Other Intangible Assets | |||||
Gross Carrying Amount | 10,319 | 10,319 | 10,319 | ||
Accumulated Amortization | (10,319) | (10,319) | (10,319) | ||
Other intangibles | |||||
Other Intangible Assets | |||||
Gross Carrying Amount | 12,270 | 12,270 | 12,270 | ||
Accumulated Amortization | (4,691) | (4,691) | (3,757) | ||
Total amortization expense | $ 7,579 | $ 7,579 | $ 8,513 |
Other Intangible Assets - Sum42
Other Intangible Assets - Summary of Amortization Expense (Details) - USD ($) $ in Thousands | Sep. 27, 2015 | Dec. 31, 2014 |
Other intangible assets | ||
2,015 | $ 1,007 | |
2,016 | 3,647 | |
2,017 | 3,569 | |
2,018 | 3,484 | |
2,019 | 3,475 | |
Thereafter | 17,778 | |
Total amortization expense | $ 32,960 | $ 35,902 |
Costs Associated with Exit an43
Costs Associated with Exit and Restructuring Activities - Summary (Details) - June 2013 Plan and April 2014 Plan - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 27, 2015 | Sep. 28, 2014 | Sep. 27, 2015 | Sep. 28, 2014 | |
Total restructuring, impairment and restructuring related charges | ||||
Restructuring and impairment charges | $ 2,525 | $ 2,064 | $ 5,673 | $ 6,210 |
Cost of Goods | ||||
Total restructuring, impairment and restructuring related charges | ||||
Restructuring related charges | 152 | 494 | 444 | 1,404 |
Operating Earnings | ||||
Total restructuring, impairment and restructuring related charges | ||||
Restructuring and impairment charges | $ 2,373 | $ 1,570 | $ 5,229 | $ 4,806 |
Costs Associated with Exit an44
Costs Associated with Exit and Restructuring Activities - April 2014 Plan (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 27, 2015USD ($) | Sep. 28, 2014USD ($) | Sep. 27, 2015USD ($) | Sep. 28, 2014USD ($) | Dec. 31, 2015employee | |
April 2014 Plan | |||||
Restructuring charges | |||||
Planned Costs | $ 9,950 | $ 9,950 | |||
Actual costs incurred | 7,741 | 7,741 | |||
Total restructuring, impairment and restructuring related charges | |||||
Restructuring and impairment charges | 2,177 | $ 575 | 4,271 | $ 2,980 | |
April 2014 Plan | Cost of Goods | |||||
Restructuring charges | |||||
Planned Costs | 4,050 | 4,050 | |||
Actual costs incurred | 369 | 369 | |||
Total restructuring, impairment and restructuring related charges | |||||
Restructuring related charges | 152 | 369 | |||
April 2014 Plan | Operating Earnings | |||||
Restructuring charges | |||||
Planned Costs | 5,900 | 5,900 | |||
Actual costs incurred | 7,372 | 7,372 | |||
Total restructuring, impairment and restructuring related charges | |||||
Restructuring and impairment charges | 2,025 | $ 575 | 3,902 | $ 2,980 | |
April 2014 Plan | Forecast | |||||
Restructuring charges | |||||
Elimination of workforce | employee | 120 | ||||
April 2014 Plan | Equipment relocation | Cost of Goods | |||||
Restructuring charges | |||||
Planned Costs | 1,800 | 1,800 | |||
Actual costs incurred | 258 | 258 | |||
April 2014 Plan | Inventory write-down | Cost of Goods | |||||
Restructuring charges | |||||
Planned Costs | 850 | 850 | |||
April 2014 Plan | Other charges | Cost of Goods | |||||
Restructuring charges | |||||
Planned Costs | 1,400 | 1,400 | |||
Actual costs incurred | 111 | 111 | |||
April 2014 Plan | Workforce reduction | Operating Earnings | |||||
Restructuring charges | |||||
Planned Costs | 4,200 | 4,200 | |||
Actual costs incurred | 4,262 | 4,262 | |||
April 2014 Plan | Other charges, including pension termination costs | Operating Earnings | |||||
Restructuring charges | |||||
Planned Costs | 1,700 | 1,700 | |||
Actual costs incurred | 3,110 | 3,110 | |||
April 2014 Plan Amendment | |||||
Restructuring charges | |||||
Planned Costs | 4,250 | 4,250 | |||
April 2014 Plan Amendment | Plant shutdown | |||||
Restructuring charges | |||||
Planned Costs | 1,300 | 1,300 | |||
April 2014 Plan Amendment | Equipment relocation | |||||
Restructuring charges | |||||
Planned Costs | $ 2,950 | $ 2,950 |
Costs Associated with Exit an45
Costs Associated with Exit and Restructuring Activities - June 2013 Plan (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 27, 2015USD ($) | Sep. 28, 2014USD ($) | Sep. 27, 2015USD ($) | Sep. 28, 2014USD ($) | Dec. 31, 2015employee | Dec. 31, 2014USD ($) | |
June 2013 Plan | ||||||
Restructuring charges | ||||||
Planned Costs | $ 22,600 | $ 22,600 | ||||
Actual costs incurred | 18,726 | 18,726 | ||||
Total restructuring, impairment and restructuring related charges | ||||||
Restructuring and impairment charges | 348 | $ 1,489 | 1,402 | $ 3,230 | ||
June 2013 Plan | Cost of Goods | ||||||
Restructuring charges | ||||||
Planned Costs | 1,800 | 1,800 | ||||
Actual costs incurred | 3,587 | 3,587 | ||||
Total restructuring, impairment and restructuring related charges | ||||||
Restructuring related charges | 494 | 75 | 1,404 | |||
June 2013 Plan | Operating Earnings | ||||||
Restructuring charges | ||||||
Planned Costs | 20,800 | 20,800 | ||||
Actual costs incurred | 15,139 | 15,139 | ||||
Total restructuring, impairment and restructuring related charges | ||||||
Restructuring and impairment charges | 348 | $ 995 | 1,327 | $ 1,826 | ||
June 2013 Plan | Forecast | ||||||
Restructuring charges | ||||||
Elimination of workforce | employee | 350 | |||||
June 2013 Plan | Inventory write-down | Cost of Goods | ||||||
Restructuring charges | ||||||
Planned Costs | 800 | 800 | ||||
Actual costs incurred | 1,143 | 1,143 | ||||
June 2013 Plan | Equipment relocation | Cost of Goods | ||||||
Restructuring charges | ||||||
Planned Costs | 900 | 900 | ||||
Actual costs incurred | 1,792 | 1,792 | ||||
June 2013 Plan | Other charges | Cost of Goods | ||||||
Restructuring charges | ||||||
Planned Costs | 100 | 100 | ||||
Actual costs incurred | 652 | 652 | ||||
June 2013 Plan | Workforce reduction | Operating Earnings | ||||||
Restructuring charges | ||||||
Planned Costs | 10,150 | 10,150 | ||||
Actual costs incurred | 9,216 | 9,216 | ||||
June 2013 Plan | Asset impairment charge | Operating Earnings | ||||||
Restructuring charges | ||||||
Planned Costs | 3,000 | 3,000 | ||||
Actual costs incurred | 4,139 | 4,139 | ||||
June 2013 Plan | Other charges, including pension termination costs | Operating Earnings | ||||||
Restructuring charges | ||||||
Planned Costs | 7,650 | 7,650 | ||||
Actual costs incurred | $ 1,784 | $ 1,784 | ||||
Amended June 2013 Plan | ||||||
Restructuring charges | ||||||
Planned Costs | $ 4,000 | |||||
Amended June 2013 Plan | Workforce reduction | Forecast | ||||||
Restructuring charges | ||||||
Elimination of workforce | employee | 130 | |||||
Foreign Pension Plans | Amended June 2013 Plan | UNITED KINGDOM | ||||||
Restructuring charges | ||||||
Planned Costs | 2,000 | |||||
Foreign Pension Plans | Amended June 2013 Plan | Workforce reduction | ||||||
Restructuring charges | ||||||
Planned Costs | $ 2,000 |
Costs Associated with Exit an46
Costs Associated with Exit and Restructuring Activities - Restructuring Reserve Activity (Details) - June 2013 Plan and April 2014 Plan $ in Thousands | 9 Months Ended |
Sep. 27, 2015USD ($) | |
Restructuring reserve activity | |
Restructuring liability at beginning | $ 3,904 |
Restructuring and restructuring-related charges | 5,791 |
Cost paid | (7,351) |
Restructuring liability at ending | $ 2,344 |
Accrued Liabilities - Component
Accrued Liabilities - Components of Accrued Liabilities (Details) - USD ($) $ in Thousands | Sep. 27, 2015 | Dec. 31, 2014 |
Accrued Liabilities | ||
Accrued product related costs | $ 4,208 | $ 5,216 |
Accrued Income taxes | 5,161 | 3,346 |
Accrued property and other taxes | 2,607 | 2,547 |
Dividends payable | 1,307 | 1,336 |
Remediation and monitoring reserves | 19,085 | 3,918 |
Other accrued liabilities | 10,663 | 8,993 |
Total accrued liabilities | $ 43,031 | $ 25,356 |
Accrued Liabilities - Remediati
Accrued Liabilities - Remediation and Monitoring Reserves (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 27, 2015 | Sep. 27, 2015 | |
Remediation and monitoring reserves | ||
Environmental charge | $ 14,541 | $ 14,541 |
Contingencies - Reserves for Re
Contingencies - Reserves for Remediation Activities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 27, 2015 | Sep. 27, 2015 | |
Reserves for remediation activities and ongoing costs | ||
Environmental charge | $ 14,541 | $ 14,541 |
Asheville Site | ||
Reserves for remediation activities and ongoing costs | ||
Environmental charge | $ 14,541 |
Debt - Long-Term Debt - (Detail
Debt - Long-Term Debt - (Details) - USD ($) | Aug. 10, 2015 | Sep. 27, 2015 | Sep. 27, 2015 | Sep. 28, 2014 | Dec. 31, 2014 |
Long-term debt | |||||
Revolving credit facility | $ 90,500,000 | $ 90,500,000 | $ 75,000,000 | ||
Revolving credit facility - terms | |||||
Borrowings repaid on previous credit facility | 943,300,000 | $ 757,700,000 | |||
Amortization expenses | 61,000 | 165,000 | |||
Revolving credit facility due 2017 | Line of Credit | |||||
Long-term debt | |||||
Revolving credit facility | $ 75,000,000 | ||||
Weighted-average interest rate | 1.50% | ||||
Amount available | $ 122,535,000 | ||||
Total credit facility | 200,000,000 | ||||
Standby letters of credit | $ 2,465,000 | ||||
Commitment fee percentage per annum | 0.25% | ||||
Revolving credit facility due 2020 | Line of Credit | |||||
Long-term debt | |||||
Revolving credit facility | $ 90,500,000 | $ 90,500,000 | |||
Weighted-average interest rate | 1.50% | 1.50% | |||
Amount available | $ 107,185,000 | $ 107,185,000 | |||
Total credit facility | $ 200,000,000 | 200,000,000 | 200,000,000 | ||
Standby letters of credit | $ 2,315,000 | $ 2,315,000 | |||
Commitment fee percentage per annum | 0.30% | ||||
Revolving credit facility - terms | |||||
Term of credit agreement (in years) | 5 years | ||||
Increase in maximum borrowing capacity subject to approval | $ 100,000,000 | ||||
Revolving credit facility due 2020 | Line of Credit | Minimum | |||||
Long-term debt | |||||
Commitment fee percentage per annum | 0.20% | ||||
Revolving credit facility due 2020 | Line of Credit | Maximum | |||||
Long-term debt | |||||
Commitment fee percentage per annum | 0.40% | ||||
Swing line sublimit | Line of Credit | |||||
Long-term debt | |||||
Total credit facility | $ 15,000,000 | ||||
Letter of credit sublimit | Line of Credit | |||||
Long-term debt | |||||
Total credit facility | $ 10,000,000 |
Debt - Additional Information (
Debt - Additional Information (Details) - Interest Rate Swap - Designated - Cash Flow Hedge | Sep. 30, 2012USD ($)agreement | Jul. 01, 2012USD ($)agreement |
Interest rate swap | ||
Number of interest rate derivatives held | agreement | 4 | 4 |
Amount of swap agreement | $ 25,000,000 | $ 50,000,000 |
Debt - Summary of Interest Rate
Debt - Summary of Interest Rate Swaps Activity Recorded in Other Comprehensive Income Before Tax (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 27, 2015 | Sep. 28, 2014 | Sep. 27, 2015 | Sep. 28, 2014 | |
Interest rate swap activity recorded in Other comprehensive earnings before tax | ||||
Amount expected to be reclassified in the next twelve months | $ 556 | $ 556 | ||
Interest Rate Swap | Designated | Cash Flow Hedge | ||||
Interest rate swap activity recorded in Other comprehensive earnings before tax | ||||
Unrealized (loss) gain | (219) | $ 124 | (628) | $ (288) |
Interest Rate Swap | Designated | Cash Flow Hedge | Interest Expense | ||||
Interest rate swap activity recorded in Other comprehensive earnings before tax | ||||
Realized loss reclassified to interest expense | $ 192 | $ 123 | $ 574 | $ 363 |
Debt - Summary of Interest Ra53
Debt - Summary of Interest Rate Swaps Included on Balance Sheets (Details) - Interest Rate Swap - Designated - Cash Flow Hedge - USD ($) $ in Thousands | Sep. 27, 2015 | Dec. 31, 2014 |
Accrued Liabilities | ||
Interest rate swaps included on the balance sheet | ||
Accrued liabilities | $ 892 | $ 640 |
Other long-term obligations | ||
Interest rate swaps included on the balance sheet | ||
Other long-term obligations | $ 181 | $ 380 |
Other Comprehensive (Loss) Earn
Other Comprehensive (Loss) Earnings - Summary of Components of Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 27, 2015 | Sep. 28, 2014 | Sep. 27, 2015 | Sep. 28, 2014 | |
Foreign currency transaction loss | ||||
Foreign currency transaction loss | $ 4,640 | |||
Changes in AOCI, Net | ||||
Total accumulated other comprehensive (loss) income, beginning of period | 289,789 | |||
Total accumulated other comprehensive (loss) income, end of period | $ 295,604 | 295,604 | ||
Accumulated other comprehensive (loss) income | ||||
Changes in AOCI, Net | ||||
Total accumulated other comprehensive (loss) income, beginning of period | (101,900) | $ (79,382) | (104,233) | $ (81,897) |
Gain (Loss) recognized in OCI, Net | (5) | 132 | 2,090 | 2,393 |
Gain (Loss) reclassified from AOCI to income, Net | 120 | 76 | 358 | 330 |
Total accumulated other comprehensive (loss) income, end of period | (101,785) | (79,174) | (101,785) | (79,174) |
Changes in fair market value of hedges | ||||
Changes in AOCI, Gross | ||||
Gross, beginning of the period | (1,047) | (1,170) | (1,020) | (998) |
Other Comprehensive Income (Loss), before Reclassifications, before Tax | (219) | 124 | (628) | (288) |
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 192 | 123 | 574 | 363 |
Gross, end of the period | (1,074) | (923) | (1,074) | (923) |
Changes in AOCI, Income tax (benefit) | ||||
Income tax (benefit), beginning of period | (394) | (447) | (384) | (402) |
Income tax (benefit), Gain (Loss) recognized in OCI | (82) | 47 | (236) | (90) |
Income tax (benefit), Gain (Loss) reclassified from AOCI to income | 72 | 47 | 216 | 139 |
Income tax (benefit), end of period | (404) | (353) | (404) | (353) |
Changes in AOCI, Net | ||||
Total accumulated other comprehensive (loss) income, beginning of period | (653) | (723) | (636) | (596) |
Gain (Loss) recognized in OCI, Net | (137) | 77 | (392) | (198) |
Gain (Loss) reclassified from AOCI to income, Net | 120 | 76 | 358 | 224 |
Total accumulated other comprehensive (loss) income, end of period | (670) | (570) | (670) | (570) |
Changes in unrealized pension cost | ||||
Changes in AOCI, Gross | ||||
Gross, beginning of the period | (166,161) | (135,180) | (169,291) | (138,133) |
Other Comprehensive Income (Loss), before Reclassifications, before Tax | 2,039 | 1,575 | 5,169 | 4,356 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 172 | |||
Gross, end of the period | (164,122) | (133,605) | (164,122) | (133,605) |
Changes in AOCI, Income tax (benefit) | ||||
Income tax (benefit), beginning of period | (63,957) | (53,896) | (65,124) | (55,028) |
Income tax (benefit), Gain (Loss) recognized in OCI | 703 | 539 | 1,870 | 1,605 |
Income tax (benefit), Gain (Loss) reclassified from AOCI to income | 66 | |||
Income tax (benefit), end of period | (63,254) | (53,357) | (63,254) | (53,357) |
Changes in AOCI, Net | ||||
Total accumulated other comprehensive (loss) income, beginning of period | (102,204) | (81,284) | (104,167) | (83,105) |
Gain (Loss) recognized in OCI, Net | 1,336 | 1,036 | 3,299 | 2,751 |
Gain (Loss) reclassified from AOCI to income, Net | 106 | |||
Total accumulated other comprehensive (loss) income, end of period | (100,868) | (80,248) | (100,868) | (80,248) |
Cumulative translation adjustment | ||||
Changes in AOCI, Gross | ||||
Gross, beginning of the period | 572 | 1,470 | 245 | 949 |
Other Comprehensive Income (Loss), before Reclassifications, before Tax | (1,056) | (590) | (729) | (69) |
Gross, end of the period | (484) | 880 | (484) | 880 |
Changes in AOCI, Income tax (benefit) | ||||
Income tax (benefit), beginning of period | (385) | (1,155) | (325) | (855) |
Income tax (benefit), Gain (Loss) recognized in OCI | 148 | 391 | 88 | 91 |
Income tax (benefit), end of period | (237) | (764) | (237) | (764) |
Changes in AOCI, Net | ||||
Total accumulated other comprehensive (loss) income, beginning of period | 957 | 2,625 | 570 | 1,804 |
Gain (Loss) recognized in OCI, Net | (1,204) | (981) | (817) | (160) |
Total accumulated other comprehensive (loss) income, end of period | $ (247) | $ 1,644 | $ (247) | $ 1,644 |
Shareholders' Equity - Summary
Shareholders' Equity - Summary of Share Count and Par Value Data Related to Shareholders' Equity (Details) - $ / shares | Sep. 27, 2015 | Dec. 31, 2014 | Sep. 28, 2014 | Dec. 31, 2013 |
Preferred Stock | ||||
Preferred stock, par value per share | ||||
Preferred stock, shares authorized | 25,000,000 | 25,000,000 | ||
Preferred stock, shares outstanding | 0 | 0 | ||
Common Stock | ||||
Common stock, par value per share | ||||
Common stock, shares authorized | 75,000,000 | 75,000,000 | ||
Common stock, shares issued | 56,241,819 | 56,101,700 | ||
Common stock, shares outstanding | 32,680,297 | 33,392,060 | 33,544,723 | 33,558,864 |
Treasury stock | ||||
Treasury stock, shares held | 23,561,522 | 22,709,640 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Details) - USD ($) | 9 Months Ended | |
Sep. 27, 2015 | Sep. 28, 2014 | |
Stockholders' Equity | ||
Common stock repurchased, Shares | 851,882 | 288,382 |
Common stock repurchased, Value | $ 15,623,000 | $ 5,084,000 |
Shares are available for future issuances | 9,742,922 |
Shareholders' Equity - Summar57
Shareholders' Equity - Summary of Common Shares Outstanding (Details) - shares | 9 Months Ended | |
Sep. 27, 2015 | Sep. 28, 2014 | |
Roll forward of common shares outstanding | ||
Balance at the beginning of the year | 33,392,060 | 33,558,864 |
Repurchases | (851,882) | (288,382) |
Shares issued upon exercise of stock options | 5,200 | 101,350 |
Restricted share issuances | 134,919 | 172,891 |
Balance at the end of the period | 32,680,297 | 33,544,723 |
Equity-Based Compensation - Sum
Equity-Based Compensation - Summary of Equity-Based Compensation Expense (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 27, 2015USD ($)plan | Sep. 28, 2014USD ($) | Sep. 27, 2015USD ($)plan | Sep. 28, 2014USD ($) | |
Share-based Compensation | ||||
Number of Equity-Based Compensation Plans | plan | 5 | 5 | ||
Restricted stock units | $ 2,655 | $ 1,839 | ||
Service-Based RSUs | ||||
Share-based Compensation | ||||
Restricted stock units | $ 295 | $ 397 | 1,244 | 1,080 |
Performance-Based RSUs | ||||
Share-based Compensation | ||||
Restricted stock units | (62) | 146 | 709 | 419 |
Market-Based RSUs | ||||
Share-based Compensation | ||||
Restricted stock units | 60 | 117 | 702 | 340 |
RSUs | ||||
Share-based Compensation | ||||
Restricted stock units | 293 | 660 | 2,655 | 1,839 |
Income tax benefit | $ 110 | $ 252 | $ 998 | $ 703 |
Equity-Based Compensation - S59
Equity-Based Compensation - Summary of Equity-Based Compensation Expense related to Non-Vested RSUs (Details) $ in Thousands | 9 Months Ended |
Sep. 27, 2015USD ($) | |
Service-Based RSUs | |
Share-based Compensation | |
Unrecognized compensation cost | $ 1,548 |
Weighted average period | 1 year 2 months 12 days |
Performance-Based RSUs | |
Share-based Compensation | |
Unrecognized compensation cost | $ 1,118 |
Weighted average period | 1 year 2 months 12 days |
Market-Based RSUs | |
Share-based Compensation | |
Unrecognized compensation cost | $ 614 |
Weighted average period | 1 year |
RSUs | |
Share-based Compensation | |
Unrecognized compensation cost | $ 3,280 |
Equity-Based Compensation - S60
Equity-Based Compensation - Summary of Status of Equity-Based Compensation Plans (Details) | Sep. 27, 2015shares |
2014 Plan | |
Summary of Status of Equity-Based Compensation Plans | |
Awards originally available | 1,500,000 |
Awards available for grant | 1,349,075 |
2009 Plan | |
Summary of Status of Equity-Based Compensation Plans | |
Awards originally available | 3,400,000 |
Awards available for grant | 1,627,069 |
2004 Plan | |
Summary of Status of Equity-Based Compensation Plans | |
Awards originally available | 6,500,000 |
Awards available for grant | 106,423 |
2001 Plan | |
Summary of Status of Equity-Based Compensation Plans | |
Awards originally available | 2,000,000 |
RSUs | 2014 Plan | |
Summary of Status of Equity-Based Compensation Plans | |
RSU's outstanding | 78,947 |
RSUs | 2009 Plan | |
Summary of Status of Equity-Based Compensation Plans | |
RSU's outstanding | 240,091 |
RSUs | 2004 Plan | |
Summary of Status of Equity-Based Compensation Plans | |
RSU's outstanding | 131,857 |
Equity-Based Compensation - Sto
Equity-Based Compensation - Stock Options (Details) - Stock Options | 9 Months Ended |
Sep. 27, 2015$ / sharesshares | |
Share-based Compensation | |
Vesting period | 4 years |
Stock option contractual term | 10 years |
Summary of Status of Stock Options | |
Outstanding, Options at beginning of year | shares | 5,200 |
Exercised, Options | shares | (5,200) |
Outstanding, Weighted - Average Exercise Price at beginning of year | $ 12.35 |
Exercised, Weighted - Average Exercise Price | $ 12.35 |
Minimum | |
Share-based Compensation | |
Stock option exercises, commencement period from date of grant | P1Y |
Maximum | |
Share-based Compensation | |
Stock options exercisable cumulative annual installments period | 10 years |
Equity-Based Compensation - Per
Equity-Based Compensation - Performance-Based Stock Options (Details) - 2014 Plan - Performance-Based Stock Options | May. 26, 2015$ / shares | Sep. 27, 2015USD ($)periodshares | Sep. 27, 2015USD ($)period |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Awards granted (in shares) | shares | 430,000 | ||
Grant date fair value (in dollars per share) | $ / shares | $ 18.37 | ||
Option term (in years) | 5 years | ||
Revenue threshold for award | $ 600,000,000 | ||
Number of fiscal-quarter ending periods for threshold | period | 4 | 4 | |
Compensation expense | $ 0 |
Equity-Based Compensation - S63
Equity-Based Compensation - Summary of Service-Based Restricted Stock Units (Details) - Service-Based RSUs | 9 Months Ended |
Sep. 27, 2015$ / sharesshares | |
Officers, key employees, and non-employee directors | |
Share-based Compensation | |
Number of shares issuable, against each unit of RSU | 1 |
Summary of Service-Based Restricted Stock Units | |
Outstanding at beginning of year | 517,965 |
Granted | 125,525 |
Converted | (165,801) |
Forfeited | (26,794) |
Outstanding at end of year | 450,895 |
Beginning of year, Weighted-average Grant-Date Fair Value | $ / shares | $ 12.06 |
Granted, Weighted-average Grant-Date Fair Value | $ / shares | 17.10 |
Converted, Weighted-average Grant-Date Fair Value | $ / shares | 12.41 |
Forfeited, Weighted-average Grant-Date Fair Value | $ / shares | 17.20 |
End of year, Weighted-average Grant-Date Fair Value | $ / shares | $ 13.03 |
Certain executives and key employees | |
Share-based Compensation | |
Vesting period | 3 years |
Non-employee directors | |
Share-based Compensation | |
Vesting period | 1 month |
Equity-Based Compensation - Sch
Equity-Based Compensation - Schedule of Performance-Based RSUs (Details) - Certain executives - Performance-Based RSUs | 9 Months Ended |
Sep. 27, 2015shares | |
February 11, 2013 | Sales growth | |
Share-based Compensation | |
Target based Vesting of performance-based restricted stock unit | 47,164 |
February 11, 2013 | Cash flow | |
Share-based Compensation | |
Target based Vesting of performance-based restricted stock unit | 40,425 |
February 14, 2014 | Sales growth | |
Share-based Compensation | |
Target based Vesting of performance-based restricted stock unit | 15,071 |
February 14, 2014 | Cash flow | |
Share-based Compensation | |
Target based Vesting of performance-based restricted stock unit | 12,918 |
February 13, 2015 | Sales growth | |
Share-based Compensation | |
Target based Vesting of performance-based restricted stock unit | 24,150 |
February 13, 2015 | Cash flow | |
Share-based Compensation | |
Target based Vesting of performance-based restricted stock unit | 20,700 |
Minimum | |
Share-based Compensation | |
Vesting percent | 0.00% |
Maximum | |
Share-based Compensation | |
Vesting percent | 200.00% |
Equity-Based Compensation - S65
Equity-Based Compensation - Schedule of Market-Based RSUs (Details) - Market-Based RSUs | 9 Months Ended |
Sep. 27, 2015itemshares | |
Market-Based RSUs | |
Vesting period | 3 years |
February 11, 2013 | CEO | |
Market-Based RSUs | |
Target based Vesting of market-based restricted stock unit | shares | 48,750 |
Number of enumerated peer group companies | 20 |
February 11, 2013 | Certain executives and key employees | |
Market-Based RSUs | |
Target based Vesting of market-based restricted stock unit | shares | 40,425 |
Number of enumerated peer group companies | 20 |
February 14, 2014 | Certain executives and key employees | |
Market-Based RSUs | |
Target based Vesting of market-based restricted stock unit | shares | 15,071 |
Number of enumerated peer group companies | 15 |
February 13, 2015 | Certain executives and key employees | |
Market-Based RSUs | |
Target based Vesting of market-based restricted stock unit | shares | 24,150 |
Number of enumerated peer group companies | 23 |
Minimum | |
Market-Based RSUs | |
Vesting percent | 0.00% |
Maximum | |
Market-Based RSUs | |
Vesting percent | 200.00% |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Financial Liability Measured at Fair Value on a Recurring Basis (Details) - Interest Rate Swap - Designated - Cash Flow Hedge - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 27, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Recurring financial liability that was measured at carrying value | |||
Interest rate swap - cash flow hedge | $ 1,074 | $ 1,020 | $ 998 |
Interest rate swap - cash flow hedge, loss | 574 | 488 | |
Recurring | |||
Recurring financial liability that was measured at carrying value | |||
Interest rate swap - cash flow hedge, loss | 574 | 488 | |
Recurring | Significant Other Observable Inputs (Level 2) | |||
Recurring financial liability that was measured at carrying value | |||
Interest rate swap - cash flow hedge | 1,074 | 1,020 | |
Recurring | Carrying Value | |||
Recurring financial liability that was measured at carrying value | |||
Interest rate swap - cash flow hedge | $ 1,074 | $ 1,020 |
Fair Value Measurements - Recon
Fair Value Measurements - Reconciliation of Recurring Financial Liability Related to Interest Rate Swaps (Details) - Interest Rate Swap - Designated - Cash Flow Hedge - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 27, 2015 | Dec. 31, 2014 | |
Reconciliation of the recurring financial liability related to interest rate swaps | ||
Beginning balance | $ (1,020) | $ (998) |
Total gains/(losses) for the period: | ||
Included in earnings | 574 | 488 |
Included in other comprehensive earnings | (628) | (510) |
Ending balance | $ (1,074) | $ (1,020) |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 27, 2015 | Sep. 28, 2014 | Sep. 27, 2015 | Sep. 28, 2014 | |
Income Taxes | ||||
Effective income tax rate | 31.20% | 31.90% | (59.20%) | 36.10% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 27, 2015 | Sep. 28, 2014 | Sep. 27, 2015 | Sep. 28, 2014 | |
Reconciliation of effective income taxes rate | ||||
Increase in effective tax rate due to reserve on an uncertain tax position (as a percent) | 42.90% | |||
Decrease in effective tax rate due to amendment of prior year tax returns | 122.10% | |||
Increase (decrease) in effective tax rate due to changes in mix of earnngs by jurisdiction and other adjustments | (3.30%) | 0.40% | ||
Accrued for interest and penalties related to uncertain income tax | $ 136 | $ 957 | $ 136 | $ 957 |