Revenue from Contract with Customer [Text Block] | 3 Effective July 1, 2018, No. 2014 09, 606 not June 30, 2018. not 605. September 30, 2018 606 606. Under the Company’s historical accounting policies, non-developmental long-term contracts were recognized when the goods were transferred to the customer. Upon adoption, contracts for highly customized customer products that have no 606. 606, Upon adoption, we recognized a reduction to retained earnings of $1.0 $0.1 $0.7 $0.6 $1.5 June 30, 2018 June 30, 2018, 606 2018 Cumulative (in thousands) Effect Net sales $ (799 ) Cost of Sales (574 ) Income tax expense 340 Net Loss $ (1,033 ) Effective Date Reported June 30, 2018 ASC 606 Adjustments As Adjusted July 1, 2018 Inventories $ 127,223 $ (574 ) $ 126,649 Accounts receivable 134,228 703 134,931 Accrued liabilities 65,575 1,502 67,077 Deferred income taxes 26,816 (340 ) 26,476 Retained earnings 761,430 (1,033 ) 760,397 Note that above amounts as of June 30 The following tables reconcile the balances as presented as of and for the three September 30, 2018 Three Months Ended September 30, 2018 As Presented Impact of ASC 606 Balances Without adoption of ASC 606 Net sales $ 193,080 $ (3,043 ) $ 190,037 Cost of sales 123,828 (2,496 ) 121,332 Gross profit 69,252 (547 ) 68,705 Selling, general, and administrative expenses 45,472 45,472 Restructuring costs 447 447 Acquisition related expenses 688 688 Total operating expenses 46,607 46,607 Income from operations 22,645 (547 ) 22,098 Interest expense (2,244 ) (2,244 ) Other non-operating income (expense) (201 ) (201 ) Income from continuing operations before income taxes 20,200 (547 ) 19,653 Provision for income taxes 5,842 (158 ) 5,684 Income from continuing operations 14,358 (389 ) 13,969 Income (loss) from discontinued operations, net of income taxes 1,499 24 1,523 Net income (loss) $ 15,857 $ (365 ) $ 15,492 Basic earnings (loss) per share: Continuing operations $ 1.13 $ (.03 ) $ 1.10 Discontinued operations 0.12 0.0 0.12 Total $ 1.25 $ (0.3 ) $ 1.22 Diluted earnings (loss) per share: Continuing operations $ 1.12 $ (0.3 ) $ 1.09 Discontinued operations 0.12 0.0 0.12 Total $ 1.24 $ (0.3 ) $ 1.21 Three Months Ended September 30, 2018 As Presented Impact of ASC 606 Balances Without adoption of ASC 606 Cash and cash equivalents $ 109,270 $ $ 109,270 Accounts receivable, net 123,804 (3,263 ) 120,541 Inventories 111,687 2,496 114,183 Prepaid expenses and other current assets 15,135 15,135 Income taxes receivable 615 615 Current assets- Discontinued Operations 36,315 36,315 Total current assets 396,826 (767 ) 396,059 Property, plant and equipment, net 139,707 139,707 Intangible assets, net 110,416 110,416 Goodwill 263,021 263,021 Deferred tax asset 6,816 6,816 Other non-current assets 31,088 31,088 Long-term assets- Discontinued Operations 61,733 61,733 Total non-current assets 612,781 612,781 Total Assets $ 1,009,607 $ (767 ) $ 1,008,840 Accounts Payable $ 63,161 $ $ 63,161 Accrued liabilities 57,868 (220 ) 57,648 Income taxes payable 5,790 (158 ) 5,632 Current liabilities- Discontinued Operations 17,950 (24 ) 17,926 Total current liabilities 144,769 (402 ) 144,367 Long-term debt 299,438 299,438 Accrued pension and other non-current liabilities 105,320 105,320 Non-current liabilities- Discontinued Operations 50 50 Total non-current liabilities 404,808 404,808 Stockholders’ equity: Common stock 41,976 41,976 Additional paid-in capital 63,280 63,280 Retained earnings 773,938 (365 ) 773,573 Accumulated other comprehensive loss (127,105 ) (127,105 ) Treasury shares (292,059 ) (292,059 ) Total stockholders’ equity 460,030 (365 ) 459,665 Total liabilities and stockholders’ equity $ 1,009,607 $ (767 ) $ 1,008,840 Revenue Recognition Accounting Policy The adoption of ASC 606 606 10 55, Principal versus Agent Considerations five 1. Identify the contract with a customer 2. Identify the performance obligations in the contract 3. Determine the transaction price 4. Allocate the transaction price to performance obligations in the contract 5. Recognize revenue when or as the Company satisfies a performance obligation Most of the Company’s contracts have a single performance obligation which represents, the product or service being sold to the customer. Some contracts include multiple performance obligations such as a product and the related installation and/or extended warranty. Additionally, most of the Company’s contracts offer assurance type warranties in connection with the sale of a product to customers. Assurance type warranties provide a customer with assurance that the product complies with agreed-upon specifications. Assurance type warranties do not In general, the Company recognizes revenue at the point in time control transfers to their customer based on predetermined shipping terms. Revenue recognized under long-term contracts within the Engineering Technologies group for highly customized customer products that have no The Company has elected to use the following practical expedients: ● The Company will use the portfolio approach for contracts with similar characteristics provided the accounting result will not ● The Company will expense all relevant incremental costs, such as selling and marketing costs, bid and proposal costs, sales commissions and legal fees to obtain a contract that has a duration of one ● The Company’s standard payment terms are less than one no The Company has made the following accounting policy elections under ASC 606: ● The Company accounts for shipping and handling activities performed after a customer has obtained control as a fulfillment activity rather than as a promise/performance obligation. ● Sales, use and value added taxes assessed by governmental authorities are excluded from the measurement of the transaction price within the company’s contracts with its customers Disaggregation of Revenue from Contracts with Customers The following table presents revenue disaggregated by product line and segment (in thousands): Three Months Ended Revenue by Product Line September 30, 2018 September 30, 2017 Refrigeration $ 54,545 $ 59,742 Merchandising & Display 9,058 8,747 Pumps 8,728 9,338 Total Food Service Equipment 72,331 77,827 Engraving Services 33,855 29,993 Engraving Products 2,124 2,836 Total Engraving 35,979 32,829 Engineering Technologies Components 20,784 20,267 Total Engineering Technologies 20,784 20,267 Electronics 51,450 46,816 Hydraulics Cylinders and System 12,536 11,403 Total Hydraulics 12,536 11,403 Total Revenue by Product Line $ 193,080 $ 189,142 The following table presents revenue disaggregated by revenue types (in thousands): Three Months Ended Revenues by Type September 30, 2018 September 30, 2017 Parts, Components and Finished Goods $ 159,225 $ 159,149 Services 33,855 29,993 Total Revenue $ 193,080 $ 189,142 The following table presents revenue from continuing operations disaggregated by geography based on company’s locations (in thousands): Three Months Ended Net sales September 30, 2018 United States $ 124,729 Asia Pacific 27,878 EMEA (1) 35,526 Other Americas 4,947 Total $ 193,080 ( 1 EMEA consists primarily of Europe, Middle East and S. Africa. The following table presents revenue from continuing operations disaggregated by timing of recognition (in thousands): Three Months Ended Timing of Revenue Recognition September 30, 2018 September 30, 2017 Products and services transferred at a point in time $ 187,898 $ 185,513 Products transferred over time 5,182 3,629 Net Sales $ 193,080 $ 189,142 Contract Balances Contract assets represent sales recognized in excess of billings related to work completed but not Contract liabilities are customer deposits for which revenue has not The following table provides information about contract assets and liability balances as of September 30, 2018 ( Balance at Beginning of Period Additions Deductions Balance at End of Period Fiscal quarter ended September 30, 2018 Contract assets: Accounts receivable $ 5,655 $ 5,422 $ 9,525 $ 1,552 Unbilled services 5,904 2,960 1,681 7,183 Contract liabilities: Customer deposits 2,552 - 503 2,049 During the quarter ended September 30, 2018, Revenue recognized in the period from: September 30, 2018 Amounts included in the contract liability balance at the beginning of the period $ 503 The timing of revenue recognition, invoicing and cash collections results in billed receivables, contract assets and contract liabilities on the consolidated balance sheets. When consideration is received from a customer prior to transferring goods or services to the customer under the terms of a contract, a contract liability is recorded. Contract liabilities are recognized as revenue after control of the goods and services are transferred to the customer and all revenue recognition criteria have been met. |