Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 29, 2018 | Jul. 31, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 29, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ESL | |
Entity Registrant Name | ESTERLINE TECHNOLOGIES CORP | |
Entity Central Index Key | 33,619 | |
Current Fiscal Year End Date | --09-28 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 29,442,875 |
CONSOLIDATED BALANCE SHEET (Una
CONSOLIDATED BALANCE SHEET (Unaudited) - USD ($) $ in Thousands | Jun. 29, 2018 | Sep. 29, 2017 |
Current Assets | ||
Cash and cash equivalents | $ 351,039 | $ 307,826 |
Accounts receivable, net of allowances of $14,391 and $16,035 | 401,244 | 430,524 |
Inventories | ||
Raw materials and purchased parts | 185,211 | 194,034 |
Work in progress | 188,956 | 178,191 |
Finished goods | 105,327 | 105,744 |
Inventories | 479,494 | 477,969 |
Income tax refundable | 18,503 | 12,814 |
Prepaid expenses | 23,778 | 19,239 |
Other current assets | 4,574 | 13,836 |
Current assets of businesses held for sale | 4,052 | 6,501 |
Total Current Assets | 1,282,684 | 1,268,709 |
Property, Plant and Equipment | 826,642 | 862,715 |
Accumulated depreciation | 509,766 | 514,081 |
Total Property, Plant and Equipment | 316,876 | 348,634 |
Other Non-Current Assets | ||
Goodwill | 1,031,234 | 1,053,573 |
Intangibles, net | 318,169 | 359,166 |
Deferred income tax benefits | 55,532 | 56,793 |
Other assets | 17,323 | 19,804 |
Non-current assets of businesses held for sale | 12,632 | 13,334 |
Total Assets | 3,034,450 | 3,120,013 |
Current Liabilities | ||
Accounts payable | 133,470 | 138,595 |
Accrued liabilities | 218,953 | 230,007 |
Current maturities of long-term debt | 15,245 | 17,424 |
U.S. and foreign income taxes | 7,151 | 582 |
Current liabilities of businesses held for sale | 3,212 | 7,184 |
Total Current Liabilities | 378,031 | 393,792 |
Long-Term Liabilities | ||
Credit facilities | 25,000 | 50,000 |
Long-term debt, net of current maturities | 695,884 | 709,424 |
Deferred income tax liabilities | 34,927 | 43,978 |
Pension and post-retirement obligations | 65,443 | 66,981 |
Long-term U.S. income taxes payable | 38,640 | 0 |
Other liabilities | 17,703 | 18,838 |
Non-current liabilities of businesses held for sale | 2,910 | 1,724 |
Shareholders' Equity | ||
Common stock, par value $.20 per share, authorized 60,000,000 shares, issued 33,177,952 and 33,117,473 shares | 6,636 | 6,623 |
Additional paid-in capital | 750,449 | 738,329 |
Treasury stock at cost, repurchased 3,737,327 and 3,135,927 shares | (351,964) | (308,514) |
Retained earnings | 1,671,906 | 1,655,187 |
Accumulated other comprehensive loss | (312,164) | (266,870) |
Total Esterline Shareholders' Equity | 1,764,863 | 1,824,755 |
Noncontrolling interests | 11,049 | 10,521 |
Total Shareholders' Equity | 1,775,912 | 1,835,276 |
Total Liabilities and Shareholders' Equity | $ 3,034,450 | $ 3,120,013 |
CONSOLIDATED BALANCE SHEET (Par
CONSOLIDATED BALANCE SHEET (Parenthetical) (Unaudited) - USD ($) $ in Thousands | Jun. 29, 2018 | Sep. 29, 2017 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, allowances | $ 14,391 | $ 16,035 |
Common stock, par value | $ 0.20 | $ 0.20 |
Common stock, shares authorized | 60,000,000 | 60,000,000 |
Common stock, shares issued | 33,177,952 | 33,117,473 |
Treasury stock, shares repurchased | 3,737,327 | 3,135,927 |
CONSOLIDATED STATEMENT OF OPERA
CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Income Statement [Abstract] | ||||
Net Sales | $ 499,871 | $ 504,107 | $ 1,499,545 | $ 1,471,654 |
Cost of Sales | 329,951 | 330,408 | 1,017,562 | 977,837 |
Gross Profit | 169,920 | 173,699 | 481,983 | 493,817 |
Expenses | ||||
Selling, general & administrative | 98,895 | 93,615 | 299,817 | 286,649 |
Research, development and engineering | 22,830 | 30,190 | 73,397 | 80,937 |
License fee income | 0 | 0 | (5,293) | 0 |
Loss (gain) on sale of business | (97) | 0 | 5,213 | 0 |
Insurance recovery | 0 | 0 | 0 | (7,789) |
Total Expenses | 121,628 | 123,805 | 373,134 | 359,797 |
Operating Earnings from Continuing Operations | 48,292 | 49,894 | 108,849 | 134,020 |
Interest Income | (579) | (150) | (1,326) | (346) |
Interest Expense | 7,902 | 7,299 | 23,673 | 22,645 |
Earnings from Continuing Operations Before Income Taxes | 40,969 | 42,745 | 86,502 | 111,721 |
Income Tax Expense | 11,094 | 10,703 | 66,962 | 23,320 |
Earnings from Continuing Operations Including Noncontrolling Interests | 29,875 | 32,042 | 19,540 | 88,401 |
Earnings Attributable to Noncontrolling Interests | 158 | 278 | 684 | 1,069 |
Earnings from Continuing Operations Attributable to Esterline, Net of Tax | 29,717 | 31,764 | 18,856 | 87,332 |
Loss from Discontinued Operations Attributable to Esterline, Net of Tax | (1,894) | (815) | (2,137) | (6,185) |
Net Earnings Attributable to Esterline | $ 27,823 | $ 30,949 | $ 16,719 | $ 81,147 |
Earnings (Loss) Per Share Attributable to Esterline - Basic: | ||||
Continuing operations | $ 1.01 | $ 1.07 | $ 0.63 | $ 2.94 |
Discontinued operations | (0.06) | (0.03) | (0.07) | (0.21) |
Earnings (Loss) Per Share | 0.95 | 1.04 | 0.56 | 2.73 |
Earnings (Loss) Per Share Attributable to Esterline - Diluted: | ||||
Continuing operations | 1 | 1.06 | 0.63 | 2.92 |
Discontinued operations | (0.06) | (0.03) | (0.07) | (0.21) |
Earnings (Loss) Per Share | $ 0.94 | $ 1.03 | $ 0.56 | $ 2.71 |
Net Earnings (Loss) | $ 27,823 | $ 30,949 | $ 16,719 | $ 81,147 |
Change in Fair Value of Derivative Financial Instruments | (13,588) | 11,966 | (20,961) | 11,034 |
Income Tax Expense (Benefit) | (4,104) | 3,575 | (6,038) | 3,094 |
Change in Fair Value of Derivative Financial Instruments, Net of Tax | (9,484) | 8,391 | (14,923) | 7,940 |
Change in Pension and Post-Retirement Obligations | 1,311 | 536 | 3,172 | 4,132 |
Income Tax Expense | 359 | 284 | 833 | 1,536 |
Change in Pension and Post-Retirement Obligations, Net of Tax | 952 | 252 | 2,339 | 2,596 |
Foreign Currency Translation Adjustment | (50,889) | 46,763 | (32,710) | 9,926 |
Comprehensive Income (Loss) | $ (31,598) | $ 86,355 | $ (28,575) | $ 101,609 |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 29, 2018 | Jun. 30, 2017 | |
Cash Flows Provided (Used) by Operating Activities | ||
Net earnings (loss) including noncontrolling interests | $ 17,403 | $ 82,216 |
Adjustments to reconcile net earnings (loss) including noncontrolling interests to net cash provided (used) by operating activities: | ||
Depreciation and amortization | 79,827 | 77,005 |
Deferred income taxes | (2,724) | (11,640) |
Share-based compensation | 9,424 | 7,549 |
Loss on disposal of fixed assets | 2,101 | 0 |
Loss (gain) on sale of business | 5,213 | 0 |
Gain on sale of discontinued operations | 0 | (793) |
Gain (loss) on assets held for sale | 780 | 3,537 |
Working capital changes: | ||
Accounts receivable | 17,125 | 23,493 |
Inventories | (26,300) | (31,462) |
Prepaid expenses | (5,254) | (4,153) |
Other current assets | (956) | (263) |
Accounts payable | (1,156) | 3,258 |
Accrued liabilities | (21,891) | (13,416) |
U.S. and foreign income taxes | 718 | (7,621) |
Long-term U.S. income taxes payable | 38,640 | 0 |
Other liabilities | (2,765) | 2,292 |
Other, net | 9,209 | 8,867 |
Net Cash Provided (Used) by Operating Activities | 119,394 | 138,869 |
Cash Flows Provided (Used) by Investing Activities | ||
Purchase of capital assets | (39,249) | (42,153) |
Proceeds from sale of capital assets | 434 | 0 |
Proceeds from sale of business | 47,814 | 600 |
Net Cash Provided (Used) by Investing Activities | 8,999 | (41,553) |
Cash Flows Provided (Used) by Financing Activities | ||
Proceeds provided by stock issuance under employee stock plans | 3,101 | 26,901 |
Withholding taxes on restricted stock units vested | (402) | (1,115) |
Shares repurchased | (43,450) | 0 |
Repayment of long-term credit facilities | (70,000) | (95,000) |
Repayment of long-term debt | (10,701) | (12,872) |
Proceeds from issuance of long-term credit facilities | 45,000 | 5,000 |
Net Cash Provided (Used) by Financing Activities | (76,452) | (77,086) |
Effect of Foreign Exchange Rates on Cash and Cash Equivalents | (8,728) | 648 |
Net Increase (Decrease) in Cash and Cash Equivalents | 43,213 | 20,878 |
Cash and Cash Equivalents - Beginning of Year | 307,826 | 258,520 |
Cash and Cash Equivalents - End of Period | 351,039 | 279,398 |
Supplemental Cash Flow Information: | ||
Cash paid for interest | 25,295 | 24,094 |
Cash paid for taxes | $ 23,671 | $ 38,641 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Jun. 29, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | Note 1 – Basis of Presentation The consolidated balance sheet as of June 29, 2018, the consolidated statement of operations and comprehensive income (loss) for the three and nine months ended June 29, 2018, and June 30, 2017, and the consolidated statement of cash flows for the nine months ended June 29, 2018, and June 30, 2017, are unaudited. In the opinion of management, all of the necessary adjustments, consisting of normal recurring accruals, have been made to present fairly the financial statements referred to above in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the above statements do not include all of the footnotes required for complete financial statements. The results of operations and cash flows for the interim periods presented are not necessarily indicative of results that can be expected for the full year. The notes to the consolidated financial statements in the Company’s Annual Report on Form 10-K/A for the fiscal year ended September 29, 2017, provide a summary of significant accounting policies and additional financial information that should be read in conjunction with this Form 10-Q. The timing of the Company’s revenues is impacted by the purchasing patterns of customers and, as a result, revenues are not generated evenly throughout the year. Moreover, the Company’s first fiscal quarter, October through December, includes significant holiday periods in both Europe and North America, resulting in fewer business days. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Jun. 29, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Recent Accounting Pronouncements | Note 2 – Recent Accounting Pronouncements In August 2017 the Financial Accounting Standards Board (“FASB”) amended its guidance on the financial reporting of hedging relationships. The new guidance eliminates the requirement to separately measure and report hedge ineffectiveness, expands permissible cash flow hedges on contractually specified components, and simplifies hedge documentation and effectiveness assessment. The guidance will be effective at the beginning of the Company’s first quarter of fiscal year 2020 and will require a modified retrospective approach on existing cash flow and net investment hedges. The presentation and disclosure requirements will be applied prospectively. The Company is currently evaluating the impact this guidance will have on the Company’s consolidated financial statements and the timing of adoption. In March 2017 the FASB issued new guidance on the presentation of the net periodic cost of postretirement benefit programs. The new standard requires sponsors of defined benefit postretirement plans to present the non-service cost components of net periodic benefit cost separate from the service cost component on the income statement. The new standard also requires that the non-service cost components of net periodic benefit cost no longer be capitalized within assets. The Company is evaluating the effects the standard will have on the Company’s consolidated financial statements and related disclosures beyond the change in income statement presentation. This new standard is effective for the Company in fiscal year 2019, with early adoption permitted. The Company plans to adopt the new standard in fiscal 2019. In January 2017 the FASB issued new guidance regarding the goodwill impairment test. The new guidance eliminates the Step 2 valuation test when evaluating goodwill for impairment. The new guidance requires that an entity performs its annual or interim goodwill test by comparing the fair value of the reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The guidance is effective for the Company in fiscal year 2021, with early adoption permitted. The standard was implemented in the first quarter of fiscal 2018. There was no impact on the Company’s financial statements as a result of adopting this guidance. In October 2016 the FASB issued new guidance regarding income taxes. The new guidance will require the tax effects of intercompany transactions, other than sales of inventory, to be recognized currently, eliminating an exception under current Generally Accepted Accounting Principles (GAAP) in which the tax effects of intra-entity asset transfers are deferred until the transferred asset is sold to a third party or otherwise recovered through use. The Company is evaluating the effect the updated standard will have on the Company’s consolidated financial statements and related disclosures. The guidance will be effective for the Company in fiscal year 2019, with early adoption permitted. The Company plans to adopt the new standard in fiscal 2019. In August 2016 the FASB issued new guidance addressing how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The Company is evaluating the effect the updated standard will have on the Company’s consolidated financial statements and related disclosures. The guidance will be effective for the Company in fiscal year 2019, with early adoption permitted. The Company plans to adopt the new standard in fiscal 2019. In June 2016 the FASB issued a new standard on the measurement of credit losses, which will impact the Company’s measurement of trade receivables. The new standard replaces the current incurred loss model with a forward-looking expected loss model that is likely to result in earlier recognition of losses. The Company is evaluating the effect the updated standard will have on the Company’s consolidated financial statements and related disclosures. The new standard is effective for the Company in 2021, with early adoption permitted, but not earlier than 2020. The Company will adopt the new standard in fiscal 2020. In February 2016 the FASB issued a new lease accounting standard, which provides revised guidance on accounting for lease arrangements by both lessors and lessees. The central requirement of the new standard is that lessees must recognize lease-related assets and liabilities for all leases with a term longer than 12 months. The Company is evaluating the effect the standard will have on the Company’s consolidated financial statements and related disclosures. The new standard is effective for the Company in fiscal year 2020, with early adoption permitted. The Company will adopt the new standard in fiscal 2020. In July 2015 the FASB issued guidance which simplifies the subsequent measurement of inventory by requiring inventory to be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling price of inventory in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This new guidance was adopted in the first quarter of fiscal 2018, with no impact to the Company’s consolidated financial statements and related disclosures. Revenue Recognition In May 2014 the FASB issued a comprehensive new revenue recognition standard that effectively replaces all current guidance on the topic. The guidance permits the use of either a retrospective or a cumulative effect transition method. The Company has performed a review of the new guidance against the Company’s current accounting practices. The Company has reviewed a representative sample of contracts and other agreements with customers and evaluated the provisions contained within these agreements compared with the amended guidance. This amended guidance is expected to change the revenue recognition practices for a number of revenue streams across the Company’s businesses; the most significant will be for certain U.S. government contracts and certain other contracts that meet one or more of the mandatory criteria, which will move revenue recognition from a “point-in-time” basis to an “over-time” basis. The ongoing effect of recording revenue on an “over-time” basis is not expected to be materially different than under the historical guidance. The amended guidance is also expected to change the recognition of certain development costs that are contractually guaranteed for reimbursement by our customers. Contractually guaranteed reimbursements for development efforts are currently recognized as the development activities are performed. Under the amended guidance, the contractually guaranteed reimbursement specific to the development effort will be deferred as a contract liability and recognized as revenue when future products are delivered to the customer. This requirement applies where the Company does not transfer all intellectual property rights related to the development effort to the customer or does not have an enforceable right to payment for performance completed to date. The costs associated with development effort under an arrangement with contractually guaranteed reimbursement will also be deferred, up to the amount reimbursed, and recognized through cost of goods sold as products are delivered to the customer. The ongoing effect of deferring contractually guaranteed reimbursements and the related costs until products are delivered to the customer is not expected to be materially different from the historical guidance. The new standard also significantly enhances required disclosures regarding revenue and related assets and liabilities. The Company is in the process of implementing changes to business processes, systems and internal controls required to adopt the new accounting standard. The updated standard becomes effective for the Company in the first quarter of fiscal 2019, with early adoption permitted. The Company expects to apply the standard using the modified retrospective approach, with a cumulative effect adjustment recognized at the beginning of fiscal year 2019. |
Earnings Per Share and Sharehol
Earnings Per Share and Shareholders Equity | 9 Months Ended |
Jun. 29, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share and Shareholders Equity | Note 3 – Earnings Per Share and Shareholders’ Equity Basic earnings per share is computed on the basis of the weighted average number of shares outstanding during the year. Diluted earnings per share includes the dilutive effect of stock options, restricted stock units and share units related to the Company’s performance share plan to the extent that performance share plan objectives are met. Common shares issuable from stock options excluded from the calculation of diluted earnings per shares because they were anti-dilutive were 950,790 and 945,572 for the three and nine months ended June 29, 2018. Common shares issuable from stock options excluded from the calculation of diluted earnings per share because they were anti-dilutive were 605,725 and 690,475 for the three and nine months ended June 30, 2017, respectively. Shares used for calculating earnings per share are disclosed in the following table: In Thousands Three Months Ended Nine Months Ended June 29, June 30, June 29, June 30, 2018 2017 2018 2017 Shares used for basic earnings per share 29,430 29,830 29,649 29,698 Shares used for diluted earnings per share 29,548 30,068 29,775 29,953 The authorized capital stock of the Company consists of 25,000 shares of preferred stock ($100 par value), 475,000 shares of serial preferred stock ($1.00 par value), each issuable in series, and 60,000,000 shares of common stock ($.20 par value). As of June 29, 2018, and September 29, 2017, there were no shares of preferred stock or serial preferred stock outstanding. In June 2014 the Company’s Board of Directors approved a $200 million share repurchase program. In March 2015 the Company’s Board of Directors approved an additional $200 million for the share repurchase program. Under the program, the Company is authorized to repurchase up to $400 million of outstanding shares of common stock from time to time, depending on market conditions, share price and other factors. Repurchases may be made in the open market or through private transactions, in accordance with SEC requirements. The Company may enter into a Rule 10(b)5-1 plan designed to facilitate the repurchase of all or a portion of the repurchase amount. The program does not require the Company to acquire a specific number of shares. Common stock repurchased can be reissued, and accordingly, the Company accounts for repurchased stock under the cost method of accounting. During the three months ended June 29, 2018, there were no shares repurchased. During the nine months ended June 29, 2018, the Company repurchased 601,400 shares under this program at an average price paid per share of $72.25, for an aggregate purchase price of $43.4 million. There were no shares repurchased during the three or nine months ended June 30, 2017. There have been no shares repurchased subsequent to June 29, 2018. Since the program began, the Company has repurchased 3,737,327 shares for an aggregate purchase price of $352.0 million, with $48.0 million in shares remaining available for repurchase in the future. Changes in issued and outstanding common shares are summarized as follows: Nine Months Ended Year Ended June 29, September 29, 2018 2017 Shares Issued: Balance, beginning of year 33,117,473 32,564,252 Shares issued under share-based compensation plans 60,479 553,221 Balance, end of current period 33,177,952 33,117,473 Treasury Stock: Balance, beginning of year (3,135,927 ) (3,135,927 ) Shares purchased (601,400 ) - Balance, end of current period (3,737,327 ) (3,135,927 ) Shares outstanding, end of period 29,440,625 29,981,546 The components of Accumulated Other Comprehensive Income (Loss): In Thousands June 29, September 29, 2018 2017 Unrealized gain (loss) on derivative contracts $ (7,492 ) $ 13,469 Tax effect 2,146 (3,892 ) (5,346 ) 9,577 Pension and post-retirement obligations (78,610 ) (81,782 ) Tax effect 27,123 27,956 (51,487 ) (53,826 ) Foreign currency translation adjustment (255,331 ) (222,621 ) Accumulated other comprehensive income (loss) $ (312,164 ) $ (266,870 ) |
Retirement Benefits
Retirement Benefits | 9 Months Ended |
Jun. 29, 2018 | |
Compensation And Retirement Disclosure [Abstract] | |
Retirement Benefits | Note 4 – Retirement Benefits The Company’s pension plans principally include a U.S. pension plan maintained by Esterline and a non-U.S. plan maintained by CMC Electronics, Inc. (CMC), a wholly owned subsidiary of the Company. The Company also sponsors a number of other non-U.S. defined benefit pension plans, primarily in Belgium, France and Germany. Components of periodic pension cost consisted of the following: In Thousands Three Months Ended Nine Months Ended June 29, June 30, June 29, June 30, 2018 2017 2018 2017 Components of Net Periodic Cost Service cost $ 3,356 $ 3,287 $ 10,125 $ 10,012 Interest cost 4,085 3,838 12,312 11,293 Expected return on plan assets (6,772 ) (6,241 ) (20,406 ) (18,796 ) Amortization of prior service cost 123 114 376 343 Amortization of actuarial (gain) loss 796 1,996 2,392 5,397 Net periodic cost $ 1,588 $ 2,994 $ 4,799 $ 8,249 The Company amortizes prior service cost and actuarial gains and losses from accumulated other comprehensive income to expense over the remaining service period. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Jun. 29, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 5 – Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy has been established that prioritizes the inputs to valuation techniques used to measure fair value. An asset’s or liability’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The hierarchy of fair value measurements is described below: Level 1 – Valuations are based on quoted prices that the Company has the ability to obtain in actively traded markets for identical assets and liabilities. Since valuations are based on quoted prices that are readily and regularly available in an active market or exchange traded market, a valuation of these instruments does not require a significant degree of judgment. Level 2 – Valuations are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. Level 3 – Valuations are based on model-based techniques for which some or all of the assumptions are not observable and therefore obtained from indirect market information that is significant to the overall fair value measurement and which require a significant degree of management judgment. The following table sets forth the Company’s financial assets and liabilities that were measured at fair value on a recurring basis by level within the fair value hierarchy at June 29, 2018, and September 29, 2017. In Thousands Level 2 June 29, September 29, 2018 2017 Assets: Derivative contracts designated as hedging instruments $ 1,014 $ 13,932 Derivative contracts not designated as hedging instruments 84 284 Embedded derivatives 3,298 746 Liabilities: Derivative contracts designated as hedging instruments $ 8,507 $ 464 Derivative contracts not designated as hedging instruments 1,440 2,440 Embedded derivatives 494 2,239 In Thousands Level 3 June 29, September 29, 2018 2017 Assets: Estimated value of assets held for sale $ 16,684 $ 19,835 Liabilities: Estimated value of liabilities held for sale $ 6,122 $ 8,908 The Company’s embedded derivatives are the result of entering into sales or purchase contracts that are denominated in a currency other than the Company’s functional currency or the supplier’s or customer’s functional currency. The fair value is determined by calculating the difference between quoted exchange rates at the time the contract was entered into and the period-end exchange rate. These contracts are categorized as Level 2 in the fair value hierarchy. The Company’s derivative contracts consist of foreign currency exchange contracts and, from time to time, interest rate swap agreements. These derivative contracts are over the counter, and their fair value is determined using modeling techniques that include market inputs such as interest rates, yield curves, and currency exchange rates. These contracts are categorized as Level 2 in the fair value hierarchy. The Company’s Board of Directors previously approved a plan to sell certain non-core business units. Based upon the estimated fair values, the Company adjusted the carrying value of the assets and liabilities of the businesses to fair value. Principal assumptions used in measuring the estimated value of assets and liabilities held for sale included estimated selling price of the discontinued business, discount rates, industry growth rates, and pricing of comparable transactions in the market. The valuations are categorized as Level 3 in the fair value hierarchy. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Jun. 29, 2018 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Note 6 – Derivative Financial Instruments The Company uses derivative financial instruments in the form of foreign currency forward exchange contracts and interest rate swap contracts for the purpose of minimizing exposure to changes in foreign currency exchange rates on business transactions and interest rates, respectively. The Company’s policy is to execute such instruments with banks the Company believes to be creditworthy and not to enter into derivative financial instruments for speculative purposes. These derivative financial instruments do not subject the Company to undue risk, as gains and losses on these instruments generally offset gains and losses on the underlying assets, liabilities, or anticipated transactions that are being hedged. All derivative financial instruments are recorded at fair value in the Consolidated Balance Sheet. For a derivative that has not been designated as an accounting hedge, the change in the fair value is recognized immediately through earnings. For a derivative that has been designated as an accounting hedge of an existing asset or liability (a fair value hedge), the change in the fair value of both the derivative and underlying asset or liability is recognized immediately through earnings. For a derivative designated as an accounting hedge of an anticipated transaction (a cash flow hedge), the change in the fair value is recorded on the Consolidated Balance Sheet in Accumulated Other Comprehensive Income (AOCI) to the extent the derivative is effective in mitigating the exposure related to the anticipated transaction. The change in the fair value related to the ineffective portion of the hedge, if any, is immediately recognized in earnings. The amount recorded within AOCI is reclassified into earnings in the same period during which the underlying hedged transaction affects earnings. The fair value of derivative instruments is presented on a gross basis, as the Company does not have any derivative contracts which are subject to master netting arrangements. The Company did not have any hedges with credit-risk-related contingent features or that required the posting of collateral as of June 29, 2018, and September 29, 2017. The cash flows from derivative contracts are recorded in operating activities in the Consolidated Statement of Cash Flows. Foreign Currency Forward Exchange Contracts The Company transacts business in various foreign currencies, which subjects the Company’s cash flows and earnings to exposure related to changes in foreign currency exchange rates. These exposures arise primarily from purchases or sales of products and services from third parties. Foreign currency forward exchange contracts provide for the purchase or sale of foreign currencies at specified future dates at specified exchange rates, and are used to offset changes in the fair value of certain assets or liabilities or forecasted cash flows resulting from transactions denominated in foreign currencies. At June 29, 2018, and September 29, 2017, the Company had outstanding foreign currency forward exchange contracts principally to sell U.S. dollars with notional amounts of $465.9 million and $406.9 million, respectively. The notional value of our foreign currency forward contracts includes $93.0 million related to the hedge of a portion of our net monetary assets, including the embedded derivatives in our backlog. These notional values consist primarily of contracts for the British pound sterling, Canadian dollar, and European euro and are stated in U.S. dollar equivalents at spot exchange rates at the respective dates. Interest Rate Swaps The Company manages its exposure to interest rate risk by maintaining an appropriate mix of fixed and variable rate debt, which over time are expected to moderate the costs of debt financing. When considered necessary, the Company may use financial instruments in the form of interest rate swaps to help meet this objective. Embedded Derivative Instruments The Company’s embedded derivatives are the result of entering into sales or purchase contracts that are denominated in a currency other than the Company’s functional currency or the supplier’s or customer’s functional currency. Net Investment Hedge In April 2015 the Company issued €330.0 million in 3.625% Senior Notes due April 2023 (2023 Notes) which require semi-annual interest payments in April and October each year until maturity. The Company designated the 2023 Notes and accrued interest as a hedge of the investment of certain foreign business units. The foreign currency gain or loss that is effective as a hedge is reported as a component of AOCI in shareholders’ equity. To the extent that this hedge is ineffective, the foreign currency gain or loss is recorded in earnings. There has been no ineffectiveness of the hedge since inception. Fair Value of Derivative Instruments Fair value of derivative instruments in the Consolidated Balance Sheet at June 29, 2018, and September 29, 2017, consisted of: In Thousands Fair Value June 29, September 29, Classification 2018 2017 Foreign Currency Forward Exchange Contracts: Other current assets $ 1,081 $ 11,433 Other assets 17 2,783 Accrued liabilities 6,587 2,506 Other liabilities 3,360 398 Embedded Derivative Instruments: Other current assets $ 1,776 $ 604 Other assets 1,522 142 Accrued liabilities 392 1,657 Other liabilities 102 582 The effect of derivative instruments on the Consolidated Statement of Operations and Comprehensive Income (Loss) for the three and nine months ended June 29, 2018, and June 30, 2017, consisted of: Fair Value Hedges and Embedded Derivatives The Company recognized the following gains (losses) on contracts designated as fair value hedges and embedded derivatives: In Thousands Three Months Ended Nine Months Ended Gain (Loss) June 29, June 30, June 29, June 30, 2018 2017 2018 2017 Fair Value Hedges: Recognized in cost of sales $ (547 ) $ 1,086 $ (1,818 ) $ 845 Recognized in selling, general & administrative (1,652 ) 906 (2,666 ) 699 Embedded derivatives: Recognized in sales $ 868 $ (952 ) $ 1,536 $ (1,169 ) Cash Flow Hedges The Company recognized the following gains (losses) on contracts designated as cash flow hedges: In Thousands Three Months Ended Nine Months Ended Gain (Loss) June 29, June 30, June 29, June 30, 2018 2017 2018 2017 Foreign currency forward exchange contracts: Recognized in AOCI (effective portion) $ (15,087 ) $ 14,250 $ (29,378 ) $ 21,188 Reclassified from AOCI into sales 1,499 (2,284 ) 8,417 (10,154 ) Net Investment Hedges The Company recognized the following gains (losses) on contracts designated as net investment hedges: In Thousands Three Months Ended Nine Months Ended Gain (Loss) June 29, June 30, June 29, June 30, 2018 2017 2018 2017 2023 Notes and Accrued Interest: Recognized in AOCI $ 21,198 $ (25,512 ) $ 4,219 $ (6,133 ) During the third quarter of fiscal 2018 and 2017, the Company recorded a loss of $4.0 million and a gain of $5.3 million, respectively, on foreign currency forward exchange contracts that have not been designated as accounting hedges. During the first nine months of fiscal 2018 and 2017, the Company recorded a loss of $5.4 million and a gain of $4.7 million, respectively, on foreign currency forward exchange contracts that have not been designated as accounting hedges. These foreign currency exchange gains and losses are included in selling, general and administrative expense. There was no significant impact to the Company’s earnings related to the ineffective portion of any hedging instruments during the first nine months of fiscal 2018 and 2017. In addition, there was no significant impact to the Company’s earnings when a hedged firm commitment no longer qualified as a fair value hedge or when a hedged forecasted transaction no longer qualified as a cash flow hedge during the first nine months of fiscal 2018 and 2017. Amounts included in AOCI are reclassified into earnings when the hedged transaction settles. The Company expects to reclassify approximately $4.4 million of net loss into earnings over the next 12 months. The maximum duration of the Company’s foreign currency cash flow hedge contracts at June 29, 2018, was 24 months. |
Insurance Recovery
Insurance Recovery | 9 Months Ended |
Jun. 29, 2018 | |
Insurance [Abstract] | |
Insurance Recovery | Note 7 – Insurance Recovery In fiscal 2017 the Company received a $7.8 million insurance recovery due to an energetic incident at one of its countermeasure operations, which occurred in the third quarter of fiscal 2016. Management does not anticipate additional insurance recoveries arising from this matter in fiscal 2018. The insurance recovery is reported as a separate line item on the Consolidated Statement of Operations and Comprehensive Income (Loss) and is included in Advanced Materials segment earnings. |
License Fee Income
License Fee Income | 9 Months Ended |
Jun. 29, 2018 | |
Revenues [Abstract] | |
License Fee Income | Note 8 – License Fee Income In January 2018 the Company granted an exclusive license to a third party to manufacture, repair and sell certain legacy avionics components for $4.5 million. In addition, the Company sold $0.4 million in inventory. The Company will be paid a 15% royalty on future sales of the licensed product. The Company recorded $2.3 million in license fee income, net of the write-off of the related intangible assets of $2.2 million in the second quarter of fiscal 2018. In December 2017 the Company granted an exclusive license to a third party to manufacture, repair and sell certain legacy control devices for $3.0 million. Additionally, the Company sold certain inventory and manufacturing equipment to the licensee for $1.0 million. The Company will be paid a 15% royalty on future sales of the licensed product. The license fee income is reported as a separate line item on the Consolidated Statement of Operations and Comprehensive Income (Loss) and is included in Avionics & Controls segment earnings. |
Sale of Business
Sale of Business | 9 Months Ended |
Jun. 29, 2018 | |
Gain Loss On Disposition Of Assets [Abstract] | |
Sale of Business | Note 9 – Sale of Business In March 2018 the Board of Directors approved the sale of the Kirkhill business, and on March 15, 2018, the Company sold the assets and certain liabilities of this business to TransDigm, Inc. for $50 million before selling costs. The Company incurred an estimated $5.2 million loss on sale of the business and an estimated $0.8 million gain after tax due to the release of a valuation allowance on a capital loss carryover. Based on current discontinued operations accounting guidance, the sale of the Kirkhill business does not qualify as a discontinued operation. |
Income Taxes
Income Taxes | 9 Months Ended |
Jun. 29, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 10 – Income Taxes The Tax Cuts and Jobs Act (the Act) was enacted on December 22, 2017. The Act reduces the U.S. federal corporate tax rate from 35% to 21%, requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred, and creates new taxes on certain foreign sourced earnings. The SEC recognized that a company’s review of certain income tax effects of the Act may be incomplete at the time financial statements are issued. According to FASB Accounting Standards Update No. 2018-05, if a company does not have the necessary information available for certain effects of the Act, the Company may record provisional numbers and adjust those amounts during the measurement period not to extend beyond one year. At June 29, 2018, the Company had not completed the accounting for the tax effects of enactment of the Act; however, in certain cases, as described below, the Company made a reasonable estimate of the effects on its existing deferred tax balances and the one-time transition tax. In other cases, the Company was not able to make a reasonable estimate in the first nine months of fiscal 2018 and continued to account for those items based on its existing accounting under ASC 740, Income Taxes, and the provisions of the tax laws that were in effect immediately prior to enactment. For the items for which the Company was able to determine a reasonable estimate, the Company recognized a provisional amount of $48.6 million, which is included as a component of income tax expense from continuing operations. In all cases, the Company will continue to make and refine the calculations as additional analysis is completed. In addition, the estimates may also be affected as the Company gains a more thorough understanding of the tax law. Provisional Amounts U.S. Deferred Tax Assets and Liabilities The Company remeasured its deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. However, the Company is still analyzing certain aspects of the Act and refining its calculations, including evaluation of limits on employee remuneration, which could affect the measurement of these balances or potentially give rise to new deferred tax amounts. The provisional amount recorded related to the remeasurement of the deferred tax balance was $6.6 million. Foreign Tax Effects The one-time transition tax is based on the Company’s total post-1986 earnings and profits (E&P) that the Company previously deferred from U.S. income taxes. The Company recorded a provisional amount for its one-time transition tax liability resulting in an increase in income tax expense of $42.0 million. The Company is still analyzing certain aspects of the Act and refining its calculations, which could potentially affect the measurement of these amounts, including the benefit attributable to foreign tax credits and related elections. Further, the transition tax is based in part on the amount of those earnings held in cash and other specified assets. This amount may change when the Company finalizes the calculations of post-1986 foreign E&P previously deferred from U.S. taxation and finalizes the amounts of cash or other specified assets. The Act sets certain limits that may restrict the Company’s use of any foreign tax credits generated from the one-time transaction tax. As of the date of this report, management was not able to (1) determine a reasonable estimate of the tax liability for the Company’s remaining outside basis; (2) complete an analysis of the Global Intangible Low Taxed Income (GILTI); or (3) evaluate how the Act will impact the Company’s existing ASC 740-10-25-3 position to indefinitely reinvest unremitted foreign earnings. The income tax rate for the third quarter of fiscal 2018 was 27.1% compared with the prior-year period of 25.0%. The difference in the effective tax rate was primarily driven by the repeal of certain benefits of foreign tax regimes, discrete tax benefits related to employee share-based payment awards, with an offset associated with a reduction in the U.S. federal statutory tax rate. The income tax rate for the first nine months of fiscal 2018 was 77.4% mainly due to the effect of the Act. In addition, the income tax rate for the first nine months of fiscal 2018 reflected a $4.6 million tax benefit from a release of a capital loss valuation reserve due to a realized capital gain upon the sale of the Kirkhill business. The 20.9% income tax rate in the first nine months of fiscal 2017 reflected the following items: the Company recognized $8.0 million of discrete tax benefits primarily related to a reduction of the income tax rate in France for fiscal 2020 and the early adoption of the accounting standard update for employee share-based payment awards. By the end of fiscal 2018, it is reasonably possible that approximately $1.0 million of tax benefits that are currently unrecognized could be recognized as a result of settlement of examinations and/or the expiration of applicable statutes of limitations. The Company recognizes interest related to unrecognized tax benefits in income tax expense. |
Debt
Debt | 9 Months Ended |
Jun. 29, 2018 | |
Debt Disclosure [Abstract] | |
Debt | Note 11 – Debt Long-term debt at June 29, 2018, and September 29, 2017, consisted of the following: In Thousands June 29, September 29, 2018 2017 U.S. credit facility $ 25,000 $ 50,000 U.S. Term Loan, due April 2020 215,625 225,000 3.625% Senior Notes, due April 2023 385,539 389,862 Government refundable advances 44,068 45,549 Obligation under capital leases 69,817 71,091 Debt issuance costs (3,920 ) (4,654 ) 736,129 776,848 Less current maturities 15,245 17,424 Carrying amount of long-term debt $ 720,884 $ 759,424 U.S. Credit Facility On April 9, 2015, the Company amended its secured credit facility to extend the maturity to April 9, 2020, increase the revolving credit facility to $500 million, and provide for a delayed-draw term loan facility of $250 million, which was drawn on August 3, 2015. The Company recorded $2.3 million in debt issuance costs. The credit facility is secured by substantially all the Company’s assets, and interest is based on standard inter-bank offering rates. The interest rate ranges from LIBOR plus 1.25% to LIBOR plus 2.00% depending on leverage ratios at the time the funds are drawn. At June 29, 2018, the Company had $25.0 million outstanding under the secured credit facility at an interest rate of LIBOR plus 1.50%, which was 3.6%. U.S. Term Loan, due April 2020 On August 3, 2015, the Company borrowed $250 million under the amended secured credit facility (U.S. Term Loan, due 2020). The interest rate on the U.S. Term Loan, due 2020, ranges from LIBOR plus 1.25% to LIBOR plus 2.00%. At June 29, 2018, the interest rate was LIBOR plus 1.50%, or 3.6%. The loan amortizes at 1.25% of the original principal balance quarterly through March 2020, with the remaining balance due in April 2020. 3.625% Senior Notes, due April 2023 In April 2015 TA Mfg. Limited, a wholly owned subsidiary of the Company, issued €330.0 million in 3.625% Notes, due 2023, requiring semi-annual interest payments in April and October of each year until maturity. The notes are designated as a net investment hedge and translated to U.S. dollars each period, with the associated gains or losses recorded to AOCI. The net proceeds from the sale of the notes, after deducting $5.9 million of debt issuance costs, were $350.8 million. The 2023 Notes are general unsecured senior obligations of the Company. The 2023 Notes are unconditionally guaranteed on a senior basis by the Company and certain subsidiaries of the Company that are guarantors under the Company’s existing secured credit facility. The 2023 Notes are subject to redemption at the option of the Company, in whole or in part at redemption prices starting at 102.719% of the principal amount plus accrued interest during the period beginning April 15, 2018, and declining annually to 100% of principal and accrued interest on or after April 15, 2021. Based on quoted market prices, the fair value of the Company’s 2023 Notes was $388.9 million and $403.2 million as of June 29, 2018, and September 29, 2017, respectively. The carrying amount of the secured credit facility and the U.S. Term Loan, due 2020, approximate fair value. The estimate of fair value for the 2023 Notes is based on Level 2 inputs as defined in the fair value hierarchy described in Note 5. Government Refundable Advances Government refundable advances consist of payments received from the Canadian government to assist in research and development related to commercial aviation. The requirement to repay this advance is solely based on year-over-year commercial aviation revenue growth at CMC beginning in 2014. Imputed interest on the advance was 2.52% at June 29, 2018. The debt recognized was $44.1 million and $45.5 million at June 29, 2018, and September 29, 2017, respectively. Obligation Under Capital Lease The Company leases certain buildings and equipment under capital leases. The present value of the minimum capital lease payments, net of the current portion, totaled $67.6 million and $69.0 million as of June 29, 2018, and September 29, 2017, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Jun. 29, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 12 – Commitments and Contingencies The Company is party to various lawsuits and claims, both as a plaintiff and defendant, and has contingent liabilities arising from the conduct of business, none of which, in the opinion of management, is expected to have a material effect on the Company’s financial position or results of operations. The Company believes that it has made appropriate and adequate provisions for contingent liabilities. On March 5, 2014, the Company entered into a Consent Agreement with the U.S. Department of State’s Directorate of Defense Trade Controls Office of Defense Trade Controls Compliance (DTCC) to resolve alleged International Traffic in Arms Regulations (ITAR) civil violations. The Consent Agreement was closed in fiscal 2017. |
Employee Stock Plans
Employee Stock Plans | 9 Months Ended |
Jun. 29, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Employee Stock Plans | Note 13 – Employee Stock Plans As of June 29, 2018, the Company had three share-based compensation plans, which are described below. The compensation cost that has been charged against income for those plans was $9.4 million and $7.5 million for the first nine months of fiscal 2018 and 2017, respectively. During the first nine months of fiscal 2018 and 2017, the Company issued 60,479 and 532,491 shares, respectively, under its share-based compensation plans. Employee Stock Purchase Plan (ESPP) The ESPP is a “safe-harbor” designed plan whereby shares are purchased by participants at a discount of 5% of the market value on the purchase date and, therefore, compensation cost is not recorded. Employee Sharesave Scheme The Company offers shares under its employee sharesave scheme for U.K. employees. This plan allows participants the option to purchase shares at a 5% discount of the market price of the stock as of the beginning of the offering period. The term of these options is three years. The sharesave scheme is not a “safe-harbor” design, and therefore, compensation cost is recognized on this plan. Under the sharesave scheme, option exercise prices are equal to the fair market value of the Company’s common stock on the date of grant. The Company granted 20,981 and 11,338 options in the nine months ended June 29, 2018, and June 30, 2017, respectively. The weighted-average grant date fair value of options granted during the nine months ended June 29, 2018, and June 30, 2017, was $22.67 and $24.61, respectively. The fair value of the awards under the employee share-save scheme was estimated using a Black-Scholes pricing model which uses the assumptions noted in the following table. The risk-free rate for the contractual life of the options is based on the U.S. Treasury zero coupon issues in effect at the time of grant. Nine Months Ended June 29, June 30, 2018 2017 Volatility 38.89 % 35.58 % Risk-free interest rate 1.98 % 1.75 % Expected life (years) 3 3 Dividends 0 0 Equity Incentive Plan Under the equity incentive plan, option exercise prices are equal to the fair market value of the Company’s common stock on the date of grant. The Company granted 239,680 and 237,200 options to purchase shares in the nine months ended June 29, 2018, and June 30, 2017, respectively. The weighted-average grant date fair value of options granted during the nine months ended June 29, 2018, and June 30, 2017, was $30.80 and $32.66 per share, respectively. The fair value of each option granted by the Company was estimated using a Black-Scholes pricing model, which uses the assumptions noted in the following table. The Company uses historical data to estimate volatility of the Company’s common stock and option exercise and employee termination assumptions. The risk-free rate for the contractual life of the option is based on the U.S. Treasury zero coupon issues in effect at the time of the grant. Nine Months Ended June 29, June 30, 2018 2017 Volatility 34.32% 34.97 - 35.42% Risk-free interest rate 2.15 - 2.47% 1.98 - 2.51% Expected life (years) 5 - 9 5 - 9 Dividends 0 0 The Company granted 45,985 and 37,100 restricted stock units in the nine months ended June 29, 2018, and June 30, 2017, respectively. The weighted-average grant date fair value of restricted stock units granted during the nine months ended June 29, 2018, and June 30, 2017, was $86.26 and $76.83 per share, respectively. The fair value of each restricted stock unit granted by the Company is equal to the fair market value of the Company’s common stock on the date of grant. The Company granted 33,700 and 43,650 performance share plan (PSP) shares in the nine months ended June 29, 2018, and June 30, 2017, respectively. PSP shares will be paid out in shares of Esterline common stock at the end of the three-year performance period. The PSP shares granted in each period equaled the number of shares participants would receive if the Company achieves target performance over the relevant period. The actual number of shares that will be paid out upon completion of the performance period is based on actual performance and may range from 0% to 300% of the target number of shares. |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Jun. 29, 2018 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Discontinued Operations | Note 14 – Discontinued Operations The Company’s Board of Directors previously approved a plan to sell certain non-core business units including Wallop Defence Systems, Ltd. (Wallop), a manufacturer of flare countermeasure devices; a small distribution business; and a small manufacturing business. On May 4, 2016, the Company sold certain assets of Wallop for 2.5 million British pounds and deferred consideration up to a maximum payment of 9 million British pounds. The deferred consideration is payable based upon receipt of acceptable orders during a three-year period ending May 3, 2019, and is equal to the amount of the acceptable order times a specified percentage ranging from 26.5% to 31%. The earn-out payment is estimated to be 4.9 million British pounds, or $6.5 million, at June 29, 2018. The Company was notified in December 2017 that it earned 1.3 million British pounds, or $1.8 million, in deferred consideration , On March 28, 2017, the Company sold a small manufacturing business for $0.6 million and a note receivable of $2.4 million, resulting in a gain on sale of the business of $0.8 million. The note receivable is due March 28, 2021, with an interest rate of 2.05%. The Company incurred a $1.9 million loss from discontinued operations in the third quarter of fiscal 2018 compared to a $0.8 million loss from discontinued operations in the third quarter of fiscal 2017. During the first nine months of fiscal 2018 and 2017, the Company incurred a loss from discontinued operations of $2.1 million and $6.2 million, respectively. Included in the $6.2 million loss for the first nine months of fiscal 2017 was a $3.6 million loss on Wallop assets held for sale, principally due to a reduction in the estimated sale price and the effect of changes of foreign currency exchange rates. There was no significant change to the estimated sale price in the third quarter of fiscal 2018. The operating results of the discontinued operations for the three months ended June 29, 2018, consisted of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Other Total Net Sales $ - $ - $ - $ - $ - Operating earnings (loss) (1,182 ) - (1,452 ) (17 ) (2,651 ) Tax expense (benefit) (35 ) - (722 ) - (757 ) Income (loss) from discontinued operations $ (1,147 ) $ - $ (730 ) $ (17 ) $ (1,894 ) Included in Operating Earnings (Loss): Gain (loss) on net assets held for sale $ (1,041 ) $ - $ (1,134 ) $ - $ (2,175 ) The operating results of the discontinued operations for the three months ended June 30, 2017, consisted of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Other Total Net Sales $ - $ - $ 270 $ - $ 270 Operating earnings (loss) (594 ) - (598 ) (3 ) (1,195 ) Tax expense (benefit) (62 ) - (318 ) - (380 ) Income (loss) from discontinued operations $ (532 ) $ - $ (280 ) $ (3 ) $ (815 ) Included in Operating Earnings (Loss): Gain (loss) on net assets held for sale $ 163 $ - $ 709 $ - $ 872 Gain on sale of discontinued operations (395 ) - - - (395 ) The operating results of the discontinued operations for the nine months ended June 29, 2018, consisted of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Other Total Net Sales $ - $ - $ - $ - $ - Operating earnings (loss) (299 ) - (2,942 ) (67 ) (3,308 ) Tax expense (benefit) (2 ) - (1,156 ) (13 ) (1,171 ) Income (loss) from discontinued operations $ (297 ) $ - $ (1,786 ) $ (54 ) $ (2,137 ) Included in Operating Earnings (Loss): Gain (loss) on net assets held for sale $ (291 ) $ - $ (489 ) $ - $ (780 ) The operating results of the discontinued operations for the nine months ended June 30, 2017, consisted of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Other Total Net Sales $ 4,964 $ - $ 270 $ - $ 5,234 Operating earnings (loss) (713 ) 893 (7,214 ) (896 ) (7,930 ) Tax expense (benefit) (492 ) - (941 ) (312 ) (1,745 ) Income (loss) from discontinued operations $ (221 ) $ 893 $ (6,273 ) $ (584 ) $ (6,185 ) Included in Operating Earnings (Loss): Gain (loss) on net assets held for sale $ 77 $ - $ (3,614 ) $ - $ (3,537 ) Gain on sale of discontinued operations 793 - - - 793 Assets and Liabilities Held for Sale within the Consolidated Balance Sheet at June 29, 2018, are comprised of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Total Other current assets $ - $ - $ 4,052 $ 4,052 Current Assets of Businesses Held for Sale - - 4,052 4,052 Net property, plant and equipment 4,221 - - 4,221 Other assets - - 8,411 8,411 Non-Current Assets of Businesses Held for Sale 4,221 - 8,411 12,632 Accounts payable - - 12 12 Accrued liabilities - - 3,200 3,200 Current Liabilities of Businesses Held for Sale - - 3,212 3,212 Deferred income tax liabilities - - 2,590 2,590 Other liabilities - - 320 320 Non-Current Liabilities of Businesses Held for Sale - - 2,910 2,910 Net Assets of Businesses Held for Sale $ 4,221 $ - $ 6,341 $ 10,562 Assets and Liabilities Held for Sale within the Consolidated Balance Sheet at September 29, 2017, were comprised of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Total Other current assets $ - $ - $ 6,501 $ 6,501 Current Assets of Businesses Held for Sale - - 6,501 6,501 Net property, plant and equipment 5,262 - - 5,262 Other assets - - 8,072 8,072 Non-Current Assets of Businesses Held for Sale 5,262 - 8,072 13,334 Accounts payable - - 138 138 Accrued liabilities - - 7,046 7,046 Current Liabilities of Businesses Held for Sale - - 7,184 7,184 Deferred income tax liabilities - - 1,404 1,404 Other liabilities - - 320 320 Non-Current Liabilities of Businesses Held for Sale - - 1,724 1,724 Net Assets of Businesses Held for Sale $ 5,262 $ - $ 5,665 $ 10,927 |
Business Segment Information
Business Segment Information | 9 Months Ended |
Jun. 29, 2018 | |
Segment Reporting [Abstract] | |
Business Segment Information | Note 15 – Business Segment Information Business segment information for continuing operations includes the segments of Avionics & Controls, Sensors & Systems and Advanced Materials. In Thousands Three Months Ended Nine Months Ended June 29, June 30, June 29, June 30, 2018 2017 2018 2017 Sales Avionics & Controls $ 210,787 $ 209,168 $ 626,304 $ 615,143 Sensors & Systems 190,895 184,804 564,516 535,287 Advanced Materials 98,189 110,135 308,725 321,224 $ 499,871 $ 504,107 $ 1,499,545 $ 1,471,654 Earnings from Continuing Operations Before Income Taxes Avionics & Controls $ 23,781 $ 22,496 $ 67,839 $ 61,185 Sensors & Systems 22,135 25,587 53,119 70,087 Advanced Materials 21,152 17,780 45,288 55,982 Segment Earnings 67,068 65,863 166,246 187,254 Corporate expense (18,776 ) (15,969 ) (57,397 ) (53,234 ) Interest income 579 150 1,326 346 Interest expense (7,902 ) (7,299 ) (23,673 ) (22,645 ) $ 40,969 $ 42,745 $ 86,502 $ 111,721 |
Recent Accounting Pronounceme21
Recent Accounting Pronouncements (Policies) | 9 Months Ended |
Jun. 29, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Recent Accounting Pronouncements | In August 2017 the Financial Accounting Standards Board (“FASB”) amended its guidance on the financial reporting of hedging relationships. The new guidance eliminates the requirement to separately measure and report hedge ineffectiveness, expands permissible cash flow hedges on contractually specified components, and simplifies hedge documentation and effectiveness assessment. The guidance will be effective at the beginning of the Company’s first quarter of fiscal year 2020 and will require a modified retrospective approach on existing cash flow and net investment hedges. The presentation and disclosure requirements will be applied prospectively. The Company is currently evaluating the impact this guidance will have on the Company’s consolidated financial statements and the timing of adoption. In March 2017 the FASB issued new guidance on the presentation of the net periodic cost of postretirement benefit programs. The new standard requires sponsors of defined benefit postretirement plans to present the non-service cost components of net periodic benefit cost separate from the service cost component on the income statement. The new standard also requires that the non-service cost components of net periodic benefit cost no longer be capitalized within assets. The Company is evaluating the effects the standard will have on the Company’s consolidated financial statements and related disclosures beyond the change in income statement presentation. This new standard is effective for the Company in fiscal year 2019, with early adoption permitted. The Company plans to adopt the new standard in fiscal 2019. In January 2017 the FASB issued new guidance regarding the goodwill impairment test. The new guidance eliminates the Step 2 valuation test when evaluating goodwill for impairment. The new guidance requires that an entity performs its annual or interim goodwill test by comparing the fair value of the reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The guidance is effective for the Company in fiscal year 2021, with early adoption permitted. The standard was implemented in the first quarter of fiscal 2018. There was no impact on the Company’s financial statements as a result of adopting this guidance. In October 2016 the FASB issued new guidance regarding income taxes. The new guidance will require the tax effects of intercompany transactions, other than sales of inventory, to be recognized currently, eliminating an exception under current Generally Accepted Accounting Principles (GAAP) in which the tax effects of intra-entity asset transfers are deferred until the transferred asset is sold to a third party or otherwise recovered through use. The Company is evaluating the effect the updated standard will have on the Company’s consolidated financial statements and related disclosures. The guidance will be effective for the Company in fiscal year 2019, with early adoption permitted. The Company plans to adopt the new standard in fiscal 2019. In August 2016 the FASB issued new guidance addressing how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The Company is evaluating the effect the updated standard will have on the Company’s consolidated financial statements and related disclosures. The guidance will be effective for the Company in fiscal year 2019, with early adoption permitted. The Company plans to adopt the new standard in fiscal 2019. In June 2016 the FASB issued a new standard on the measurement of credit losses, which will impact the Company’s measurement of trade receivables. The new standard replaces the current incurred loss model with a forward-looking expected loss model that is likely to result in earlier recognition of losses. The Company is evaluating the effect the updated standard will have on the Company’s consolidated financial statements and related disclosures. The new standard is effective for the Company in 2021, with early adoption permitted, but not earlier than 2020. The Company will adopt the new standard in fiscal 2020. In February 2016 the FASB issued a new lease accounting standard, which provides revised guidance on accounting for lease arrangements by both lessors and lessees. The central requirement of the new standard is that lessees must recognize lease-related assets and liabilities for all leases with a term longer than 12 months. The Company is evaluating the effect the standard will have on the Company’s consolidated financial statements and related disclosures. The new standard is effective for the Company in fiscal year 2020, with early adoption permitted. The Company will adopt the new standard in fiscal 2020. In July 2015 the FASB issued guidance which simplifies the subsequent measurement of inventory by requiring inventory to be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling price of inventory in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This new guidance was adopted in the first quarter of fiscal 2018, with no impact to the Company’s consolidated financial statements and related disclosures. Revenue Recognition In May 2014 the FASB issued a comprehensive new revenue recognition standard that effectively replaces all current guidance on the topic. The guidance permits the use of either a retrospective or a cumulative effect transition method. The Company has performed a review of the new guidance against the Company’s current accounting practices. The Company has reviewed a representative sample of contracts and other agreements with customers and evaluated the provisions contained within these agreements compared with the amended guidance. This amended guidance is expected to change the revenue recognition practices for a number of revenue streams across the Company’s businesses; the most significant will be for certain U.S. government contracts and certain other contracts that meet one or more of the mandatory criteria, which will move revenue recognition from a “point-in-time” basis to an “over-time” basis. The ongoing effect of recording revenue on an “over-time” basis is not expected to be materially different than under the historical guidance. The amended guidance is also expected to change the recognition of certain development costs that are contractually guaranteed for reimbursement by our customers. Contractually guaranteed reimbursements for development efforts are currently recognized as the development activities are performed. Under the amended guidance, the contractually guaranteed reimbursement specific to the development effort will be deferred as a contract liability and recognized as revenue when future products are delivered to the customer. This requirement applies where the Company does not transfer all intellectual property rights related to the development effort to the customer or does not have an enforceable right to payment for performance completed to date. The costs associated with development effort under an arrangement with contractually guaranteed reimbursement will also be deferred, up to the amount reimbursed, and recognized through cost of goods sold as products are delivered to the customer. The ongoing effect of deferring contractually guaranteed reimbursements and the related costs until products are delivered to the customer is not expected to be materially different from the historical guidance. The new standard also significantly enhances required disclosures regarding revenue and related assets and liabilities. The Company is in the process of implementing changes to business processes, systems and internal controls required to adopt the new accounting standard. The updated standard becomes effective for the Company in the first quarter of fiscal 2019, with early adoption permitted. The Company expects to apply the standard using the modified retrospective approach, with a cumulative effect adjustment recognized at the beginning of fiscal year 2019. |
Earnings Per Share and Shareh22
Earnings Per Share and Shareholders Equity (Tables) | 9 Months Ended |
Jun. 29, 2018 | |
Earnings Per Share [Abstract] | |
Shares Used for Calculating Earnings Per Share | Shares used for calculating earnings per share are disclosed in the following table: In Thousands Three Months Ended Nine Months Ended June 29, June 30, June 29, June 30, 2018 2017 2018 2017 Shares used for basic earnings per share 29,430 29,830 29,649 29,698 Shares used for diluted earnings per share 29,548 30,068 29,775 29,953 |
Schedule of Changes in Issued and Outstanding Common Shares and Treasury Stock | Changes in issued and outstanding common shares are summarized as follows: Nine Months Ended Year Ended June 29, September 29, 2018 2017 Shares Issued: Balance, beginning of year 33,117,473 32,564,252 Shares issued under share-based compensation plans 60,479 553,221 Balance, end of current period 33,177,952 33,117,473 Treasury Stock: Balance, beginning of year (3,135,927 ) (3,135,927 ) Shares purchased (601,400 ) - Balance, end of current period (3,737,327 ) (3,135,927 ) Shares outstanding, end of period 29,440,625 29,981,546 |
Schedule of Components of Accumulated Other Comprehensive Income (Loss) | The components of Accumulated Other Comprehensive Income (Loss): In Thousands June 29, September 29, 2018 2017 Unrealized gain (loss) on derivative contracts $ (7,492 ) $ 13,469 Tax effect 2,146 (3,892 ) (5,346 ) 9,577 Pension and post-retirement obligations (78,610 ) (81,782 ) Tax effect 27,123 27,956 (51,487 ) (53,826 ) Foreign currency translation adjustment (255,331 ) (222,621 ) Accumulated other comprehensive income (loss) $ (312,164 ) $ (266,870 ) |
Retirement Benefits (Tables)
Retirement Benefits (Tables) | 9 Months Ended |
Jun. 29, 2018 | |
Compensation And Retirement Disclosure [Abstract] | |
Schedule of Net Periodic Pension Cost | The Company’s pension plans principally include a U.S. pension plan maintained by Esterline and a non-U.S. plan maintained by CMC Electronics, Inc. (CMC), a wholly owned subsidiary of the Company. The Company also sponsors a number of other non-U.S. defined benefit pension plans, primarily in Belgium, France and Germany. Components of periodic pension cost consisted of the following: In Thousands Three Months Ended Nine Months Ended June 29, June 30, June 29, June 30, 2018 2017 2018 2017 Components of Net Periodic Cost Service cost $ 3,356 $ 3,287 $ 10,125 $ 10,012 Interest cost 4,085 3,838 12,312 11,293 Expected return on plan assets (6,772 ) (6,241 ) (20,406 ) (18,796 ) Amortization of prior service cost 123 114 376 343 Amortization of actuarial (gain) loss 796 1,996 2,392 5,397 Net periodic cost $ 1,588 $ 2,994 $ 4,799 $ 8,249 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Jun. 29, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table sets forth the Company’s financial assets and liabilities that were measured at fair value on a recurring basis by level within the fair value hierarchy at June 29, 2018, and September 29, 2017. In Thousands Level 2 June 29, September 29, 2018 2017 Assets: Derivative contracts designated as hedging instruments $ 1,014 $ 13,932 Derivative contracts not designated as hedging instruments 84 284 Embedded derivatives 3,298 746 Liabilities: Derivative contracts designated as hedging instruments $ 8,507 $ 464 Derivative contracts not designated as hedging instruments 1,440 2,440 Embedded derivatives 494 2,239 In Thousands Level 3 June 29, September 29, 2018 2017 Assets: Estimated value of assets held for sale $ 16,684 $ 19,835 Liabilities: Estimated value of liabilities held for sale $ 6,122 $ 8,908 |
Derivative Financial Instrume25
Derivative Financial Instruments (Tables) | 9 Months Ended |
Jun. 29, 2018 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Fair Value of Derivative Instruments In Consolidated Balance Sheet | Fair value of derivative instruments in the Consolidated Balance Sheet at June 29, 2018, and September 29, 2017, consisted of: In Thousands Fair Value June 29, September 29, Classification 2018 2017 Foreign Currency Forward Exchange Contracts: Other current assets $ 1,081 $ 11,433 Other assets 17 2,783 Accrued liabilities 6,587 2,506 Other liabilities 3,360 398 Embedded Derivative Instruments: Other current assets $ 1,776 $ 604 Other assets 1,522 142 Accrued liabilities 392 1,657 Other liabilities 102 582 |
Effect of Derivative Instruments on Consolidated Statement of Operations and Comprehensive Income (Loss) | The effect of derivative instruments on the Consolidated Statement of Operations and Comprehensive Income (Loss) for the three and nine months ended June 29, 2018, and June 30, 2017, consisted of: Fair Value Hedges and Embedded Derivatives The Company recognized the following gains (losses) on contracts designated as fair value hedges and embedded derivatives: In Thousands Three Months Ended Nine Months Ended Gain (Loss) June 29, June 30, June 29, June 30, 2018 2017 2018 2017 Fair Value Hedges: Recognized in cost of sales $ (547 ) $ 1,086 $ (1,818 ) $ 845 Recognized in selling, general & administrative (1,652 ) 906 (2,666 ) 699 Embedded derivatives: Recognized in sales $ 868 $ (952 ) $ 1,536 $ (1,169 ) Cash Flow Hedges The Company recognized the following gains (losses) on contracts designated as cash flow hedges: In Thousands Three Months Ended Nine Months Ended Gain (Loss) June 29, June 30, June 29, June 30, 2018 2017 2018 2017 Foreign currency forward exchange contracts: Recognized in AOCI (effective portion) $ (15,087 ) $ 14,250 $ (29,378 ) $ 21,188 Reclassified from AOCI into sales 1,499 (2,284 ) 8,417 (10,154 ) Net Investment Hedges The Company recognized the following gains (losses) on contracts designated as net investment hedges: In Thousands Three Months Ended Nine Months Ended Gain (Loss) June 29, June 30, June 29, June 30, 2018 2017 2018 2017 2023 Notes and Accrued Interest: Recognized in AOCI $ 21,198 $ (25,512 ) $ 4,219 $ (6,133 ) |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Jun. 29, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-term debt at June 29, 2018, and September 29, 2017, consisted of the following: In Thousands June 29, September 29, 2018 2017 U.S. credit facility $ 25,000 $ 50,000 U.S. Term Loan, due April 2020 215,625 225,000 3.625% Senior Notes, due April 2023 385,539 389,862 Government refundable advances 44,068 45,549 Obligation under capital leases 69,817 71,091 Debt issuance costs (3,920 ) (4,654 ) 736,129 776,848 Less current maturities 15,245 17,424 Carrying amount of long-term debt $ 720,884 $ 759,424 |
Employee Stock Plans (Tables)
Employee Stock Plans (Tables) | 9 Months Ended |
Jun. 29, 2018 | |
Employee Share-save Scheme | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Fair Value of Option Granted using Black-Scholes Pricing Model | The fair value of the awards under the employee share-save scheme was estimated using a Black-Scholes pricing model which uses the assumptions noted in the following table. Nine Months Ended June 29, June 30, 2018 2017 Volatility 38.89 % 35.58 % Risk-free interest rate 1.98 % 1.75 % Expected life (years) 3 3 Dividends 0 0 |
Equity Incentive Plan | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Fair Value of Option Granted using Black-Scholes Pricing Model | The fair value of each option granted by the Company was estimated using a Black-Scholes pricing model, which uses the assumptions noted in the following table. Nine Months Ended June 29, June 30, 2018 2017 Volatility 34.32% 34.97 - 35.42% Risk-free interest rate 2.15 - 2.47% 1.98 - 2.51% Expected life (years) 5 - 9 5 - 9 Dividends 0 0 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Jun. 29, 2018 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The operating results of the discontinued operations for the three months ended June 29, 2018, consisted of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Other Total Net Sales $ - $ - $ - $ - $ - Operating earnings (loss) (1,182 ) - (1,452 ) (17 ) (2,651 ) Tax expense (benefit) (35 ) - (722 ) - (757 ) Income (loss) from discontinued operations $ (1,147 ) $ - $ (730 ) $ (17 ) $ (1,894 ) Included in Operating Earnings (Loss): Gain (loss) on net assets held for sale $ (1,041 ) $ - $ (1,134 ) $ - $ (2,175 ) The operating results of the discontinued operations for the three months ended June 30, 2017, consisted of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Other Total Net Sales $ - $ - $ 270 $ - $ 270 Operating earnings (loss) (594 ) - (598 ) (3 ) (1,195 ) Tax expense (benefit) (62 ) - (318 ) - (380 ) Income (loss) from discontinued operations $ (532 ) $ - $ (280 ) $ (3 ) $ (815 ) Included in Operating Earnings (Loss): Gain (loss) on net assets held for sale $ 163 $ - $ 709 $ - $ 872 Gain on sale of discontinued operations (395 ) - - - (395 ) The operating results of the discontinued operations for the nine months ended June 29, 2018, consisted of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Other Total Net Sales $ - $ - $ - $ - $ - Operating earnings (loss) (299 ) - (2,942 ) (67 ) (3,308 ) Tax expense (benefit) (2 ) - (1,156 ) (13 ) (1,171 ) Income (loss) from discontinued operations $ (297 ) $ - $ (1,786 ) $ (54 ) $ (2,137 ) Included in Operating Earnings (Loss): Gain (loss) on net assets held for sale $ (291 ) $ - $ (489 ) $ - $ (780 ) The operating results of the discontinued operations for the nine months ended June 30, 2017, consisted of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Other Total Net Sales $ 4,964 $ - $ 270 $ - $ 5,234 Operating earnings (loss) (713 ) 893 (7,214 ) (896 ) (7,930 ) Tax expense (benefit) (492 ) - (941 ) (312 ) (1,745 ) Income (loss) from discontinued operations $ (221 ) $ 893 $ (6,273 ) $ (584 ) $ (6,185 ) Included in Operating Earnings (Loss): Gain (loss) on net assets held for sale $ 77 $ - $ (3,614 ) $ - $ (3,537 ) Gain on sale of discontinued operations 793 - - - 793 Assets and Liabilities Held for Sale within the Consolidated Balance Sheet at June 29, 2018, are comprised of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Total Other current assets $ - $ - $ 4,052 $ 4,052 Current Assets of Businesses Held for Sale - - 4,052 4,052 Net property, plant and equipment 4,221 - - 4,221 Other assets - - 8,411 8,411 Non-Current Assets of Businesses Held for Sale 4,221 - 8,411 12,632 Accounts payable - - 12 12 Accrued liabilities - - 3,200 3,200 Current Liabilities of Businesses Held for Sale - - 3,212 3,212 Deferred income tax liabilities - - 2,590 2,590 Other liabilities - - 320 320 Non-Current Liabilities of Businesses Held for Sale - - 2,910 2,910 Net Assets of Businesses Held for Sale $ 4,221 $ - $ 6,341 $ 10,562 Assets and Liabilities Held for Sale within the Consolidated Balance Sheet at September 29, 2017, were comprised of the following: In Thousands Avionics & Sensors & Advanced Controls Systems Materials Total Other current assets $ - $ - $ 6,501 $ 6,501 Current Assets of Businesses Held for Sale - - 6,501 6,501 Net property, plant and equipment 5,262 - - 5,262 Other assets - - 8,072 8,072 Non-Current Assets of Businesses Held for Sale 5,262 - 8,072 13,334 Accounts payable - - 138 138 Accrued liabilities - - 7,046 7,046 Current Liabilities of Businesses Held for Sale - - 7,184 7,184 Deferred income tax liabilities - - 1,404 1,404 Other liabilities - - 320 320 Non-Current Liabilities of Businesses Held for Sale - - 1,724 1,724 Net Assets of Businesses Held for Sale $ 5,262 $ - $ 5,665 $ 10,927 |
Business Segment Information (T
Business Segment Information (Tables) | 9 Months Ended |
Jun. 29, 2018 | |
Segment Reporting [Abstract] | |
Business Segment Information for Continuing Operations | Business segment information for continuing operations includes the segments of Avionics & Controls, Sensors & Systems and Advanced Materials. In Thousands Three Months Ended Nine Months Ended June 29, June 30, June 29, June 30, 2018 2017 2018 2017 Sales Avionics & Controls $ 210,787 $ 209,168 $ 626,304 $ 615,143 Sensors & Systems 190,895 184,804 564,516 535,287 Advanced Materials 98,189 110,135 308,725 321,224 $ 499,871 $ 504,107 $ 1,499,545 $ 1,471,654 Earnings from Continuing Operations Before Income Taxes Avionics & Controls $ 23,781 $ 22,496 $ 67,839 $ 61,185 Sensors & Systems 22,135 25,587 53,119 70,087 Advanced Materials 21,152 17,780 45,288 55,982 Segment Earnings 67,068 65,863 166,246 187,254 Corporate expense (18,776 ) (15,969 ) (57,397 ) (53,234 ) Interest income 579 150 1,326 346 Interest expense (7,902 ) (7,299 ) (23,673 ) (22,645 ) $ 40,969 $ 42,745 $ 86,502 $ 111,721 |
Earnings Per Share and Shareh30
Earnings Per Share and Shareholders Equity - Additional Information (Detail) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 48 Months Ended | ||||
Aug. 03, 2018 | Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | Sep. 29, 2017 | Jun. 29, 2018 | Mar. 31, 2015 | Jun. 30, 2014 | |
Earnings Per Share And Shareholders Equity [Line Items] | |||||||||
Anti-dilutive shares excluded from computation of earnings per share | 950,790 | 605,725 | 945,572 | 690,475 | |||||
Preferred stock shares authorized | 25,000 | 25,000 | 25,000 | ||||||
Preferred stock, par value | $ 100 | $ 100 | $ 100 | ||||||
Common stock, shares authorized | 60,000,000 | 60,000,000 | 60,000,000 | 60,000,000 | |||||
Common stock, par value | $ 0.20 | $ 0.20 | $ 0.20 | $ 0.20 | |||||
Preferred stock shares outstanding | 0 | 0 | 0 | 0 | |||||
Approved and authorized amount under the stock repurchase program | $ 400,000,000 | $ 200,000,000 | |||||||
Additional approved and authorized amount under the stock repurchase program | $ 200,000,000 | ||||||||
Stock repurchased during period, shares | 0 | 0 | 601,400 | 0 | 0 | 3,737,327 | |||
Average price paid per share of repurchased stock | $ 72.25 | ||||||||
Aggregate value of repurchased stock | $ 43,400,000 | $ 352,000,000 | |||||||
Stock repurchase program, remaining authorized amount available for repurchase in future | $ 48,000,000 | $ 48,000,000 | $ 48,000,000 | ||||||
Subsequent Event | |||||||||
Earnings Per Share And Shareholders Equity [Line Items] | |||||||||
Stock repurchased during period, shares | 0 | ||||||||
Series B Preferred Stock | |||||||||
Earnings Per Share And Shareholders Equity [Line Items] | |||||||||
Preferred stock shares authorized | 475,000 | 475,000 | 475,000 | ||||||
Preferred stock, par value | $ 1 | $ 1 | $ 1 | ||||||
Preferred stock shares outstanding | 0 | 0 | 0 | 0 |
Shares Used for Calculating Ear
Shares Used for Calculating Earnings Per Share (Detail) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Shares used for basic earnings per share | 29,430 | 29,830 | 29,649 | 29,698 |
Shares used for diluted earnings per share | 29,548 | 30,068 | 29,775 | 29,953 |
Schedule of Changes in Issued a
Schedule of Changes in Issued and Outstanding Common Shares and Treasury Stock (Detail) - shares | 3 Months Ended | 9 Months Ended | 12 Months Ended | 48 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | Sep. 29, 2017 | Jun. 29, 2018 | |
Equity [Abstract] | ||||||
Balance, beginning of year | 33,117,473 | 32,564,252 | 32,564,252 | |||
Shares issued under share-based compensation plans | 60,479 | 553,221 | ||||
Balance, end of current period | 33,177,952 | 33,177,952 | 33,117,473 | 33,177,952 | ||
Balance, beginning of year | (3,135,927) | (3,135,927) | (3,135,927) | |||
Shares purchased | 0 | 0 | (601,400) | 0 | 0 | (3,737,327) |
Balance, end of current period | (3,737,327) | (3,737,327) | (3,135,927) | (3,737,327) | ||
Shares outstanding, end of period | 29,440,625 | 29,440,625 | 29,981,546 | 29,440,625 |
Schedule of Components of Accum
Schedule of Components of Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | Jun. 29, 2018 | Sep. 29, 2017 |
Accumulated Other Comprehensive Income Loss Net Of Tax [Abstract] | ||
Unrealized gain (loss) on derivative contracts | $ (7,492) | $ 13,469 |
Tax effect | 2,146 | (3,892) |
Unrealized gain on derivative contracts, Total | (5,346) | 9,577 |
Pension and post-retirement obligations | (78,610) | (81,782) |
Tax effect | 27,123 | 27,956 |
Pension and post-retirement obligations, Total | (51,487) | (53,826) |
Foreign currency translation adjustment | (255,331) | (222,621) |
Accumulated other comprehensive income (loss) | $ (312,164) | $ (266,870) |
Schedule of Net Periodic Pensio
Schedule of Net Periodic Pension Cost (Detail) - Pension Plans, Defined Benefit - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 3,356 | $ 3,287 | $ 10,125 | $ 10,012 |
Interest cost | 4,085 | 3,838 | 12,312 | 11,293 |
Expected return on plan assets | (6,772) | (6,241) | (20,406) | (18,796) |
Amortization of prior service cost | 123 | 114 | 376 | 343 |
Amortization of actuarial (gain) loss | 796 | 1,996 | 2,392 | 5,397 |
Net periodic cost | $ 1,588 | $ 2,994 | $ 4,799 | $ 8,249 |
Schedule of Financial Assets an
Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Jun. 29, 2018 | Sep. 29, 2017 |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative contracts designated as hedging instruments, Assets | $ 1,014 | $ 13,932 |
Derivative contracts not designated as hedging instruments, Assets | 84 | 284 |
Embedded derivatives, Assets | 3,298 | 746 |
Derivative contracts designated as hedging instruments, Liabilities | 8,507 | 464 |
Derivative contracts not designated as hedging instruments, Liabilities | 1,440 | 2,440 |
Embedded derivatives, Liabilities | 494 | 2,239 |
Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Estimated value of assets held for sale | 16,684 | 19,835 |
Estimated value of liabilities held for sale | $ 6,122 | $ 8,908 |
Derivative Financial Instrume36
Derivative Financial Instruments - Additional Information (Detail) € in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Apr. 30, 2015EUR (€) | Jun. 29, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 29, 2018USD ($) | Jun. 30, 2017USD ($) | Sep. 29, 2017USD ($) | |
Derivative [Line Items] | ||||||
Gains (Losses) on foreign currency forward exchange contracts not designated as an accounting hedge | $ (4) | $ 5.3 | $ (5.4) | $ 4.7 | ||
Net Gain (Loss) expected to be reclassified into earnings over next 12 months | $ (4.4) | $ (4.4) | ||||
Maturities of forecasted transactions using forward exchange contracts | 24 months | |||||
3.625% Senior Notes, Due April 2023 | ||||||
Derivative [Line Items] | ||||||
Debt instrument, interest rate | 3.625% | 3.625% | 3.625% | 3.625% | ||
Debt instruments maturity date | Apr. 30, 2023 | |||||
Net Investment Hedges | 3.625% Senior Notes, Due April 2023 | ||||||
Derivative [Line Items] | ||||||
Derivative notional amount | € | € 330 | |||||
Foreign Exchange Forward | ||||||
Derivative [Line Items] | ||||||
Derivative notional amount | $ 465.9 | $ 465.9 | $ 406.9 | |||
Foreign Exchange Forward Contracts Related to Net Monetary Assets | Cash Flow Hedging | ||||||
Derivative [Line Items] | ||||||
Derivative notional amount | $ 93 | $ 93 |
Fair Value of Derivative Instru
Fair Value of Derivative Instruments in Consolidated Balance Sheet (Detail) - USD ($) $ in Thousands | Jun. 29, 2018 | Sep. 29, 2017 |
Foreign Exchange Forward | Other Current Assets | ||
Derivatives Fair Value [Line Items] | ||
Derivative Instruments, Assets | $ 1,081 | $ 11,433 |
Foreign Exchange Forward | Other Assets | ||
Derivatives Fair Value [Line Items] | ||
Derivative Instruments, Assets | 17 | 2,783 |
Foreign Exchange Forward | Other Liabilities | ||
Derivatives Fair Value [Line Items] | ||
Derivative Instruments, Liabilities | 3,360 | 398 |
Foreign Exchange Forward | Accrued Liabilities | ||
Derivatives Fair Value [Line Items] | ||
Derivative Instruments, Liabilities | 6,587 | 2,506 |
Embedded Derivative Financial Instruments | Other Current Assets | ||
Derivatives Fair Value [Line Items] | ||
Derivative Instruments, Assets | 1,776 | 604 |
Embedded Derivative Financial Instruments | Other Assets | ||
Derivatives Fair Value [Line Items] | ||
Derivative Instruments, Assets | 1,522 | 142 |
Embedded Derivative Financial Instruments | Other Liabilities | ||
Derivatives Fair Value [Line Items] | ||
Derivative Instruments, Liabilities | 102 | 582 |
Embedded Derivative Financial Instruments | Accrued Liabilities | ||
Derivatives Fair Value [Line Items] | ||
Derivative Instruments, Liabilities | $ 392 | $ 1,657 |
Effect of Derivative Instrument
Effect of Derivative Instruments on Consolidated Statement of Operations and Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Fair Value Hedges | Cost of Sales | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Gains (losses) on contracts designated as fair value hedges and embedded derivatives | $ (547) | $ 1,086 | $ (1,818) | $ 845 |
Fair Value Hedges | Selling, General & Administrative | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Gains (losses) on contracts designated as fair value hedges and embedded derivatives | (1,652) | 906 | (2,666) | 699 |
Net Investment Hedges | 2023 Notes and Accrued Interest | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Gain (Loss) Recognized in AOCI | 21,198 | (25,512) | 4,219 | (6,133) |
Embedded Derivatives | Sales | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Gains (losses) on contracts designated as fair value hedges and embedded derivatives | 868 | (952) | 1,536 | (1,169) |
Foreign Exchange Forward | Cash Flow Hedging | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Gain (Loss) Recognized in AOCI (effective portion) | (15,087) | 14,250 | (29,378) | 21,188 |
Gain (Loss) Reclassified from AOCI into sales | $ 1,499 | $ (2,284) | $ 8,417 | $ (10,154) |
Insurance Recovery - Additional
Insurance Recovery - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | Sep. 29, 2017 | |
Insurance [Abstract] | |||||
Insurance recovery received | $ 0 | $ 0 | $ 0 | $ 7,789 | $ 7,800 |
License Fee Income - Additional
License Fee Income - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Jan. 31, 2018 | Dec. 29, 2017 | Jun. 29, 2018 | Mar. 30, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Revenues [Abstract] | |||||||
License income from third party | $ 4,500 | $ 3,000 | $ 0 | $ 0 | $ 5,293 | $ 0 | |
Inventory sold | $ 400 | ||||||
License fee income net of intangible assets write-off | $ 2,300 | ||||||
Write-off intangible assets, net | $ 2,200 | ||||||
Inventory and manufacturing equipment sold | $ 1,000 | ||||||
Royalty percentage on sale of licensed product | 15.00% |
Sale of Business - Additional I
Sale of Business - Additional Information (Detail) - USD ($) $ in Thousands | Mar. 15, 2018 | Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 |
Sale Of Business [Line Items] | |||||
Sale of business | $ 50,000 | $ 47,814 | $ 600 | ||
Gain (loss) on sale of business | (5,200) | $ 97 | $ 0 | $ (5,213) | $ 0 |
Valuation Allowance | |||||
Sale Of Business [Line Items] | |||||
Gain (loss) on sale of business | $ 800 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Jun. 29, 2018 | Dec. 29, 2017 | Jun. 30, 2017 | Sep. 29, 2018 | Jun. 29, 2018 | Jun. 30, 2017 | |
Income Taxes [Line Items] | ||||||
U.S. federal corporate tax rate | 35.00% | |||||
Recognized provisional amount as component of income tax expense from continuing operations due to change in tax rate | $ 48.6 | |||||
Remeasurement of deferred tax assets and liabilities based on rate at which expected to reverse in future | 21.00% | |||||
Provisional amount recorded related to remeasurement of deferred tax balance | $ 6.6 | |||||
Provisional amount for one-time transition tax liability resulting in increase in income tax expense due to foreign tax effects | 42 | |||||
Unrecognized tax benefit reasonably possible to be recognized by the end of fiscal 2018 | $ 1 | |||||
Adjustments for New Accounting Pronouncement | Adjustments for New Accounting Principle, Early Adoption | ||||||
Income Taxes [Line Items] | ||||||
Income tax rate | 27.10% | 25.00% | 20.90% | |||
Adjustments for New Accounting Pronouncement | Adjustments for New Accounting Principle, Early Adoption | Elastomer Business | ||||||
Income Taxes [Line Items] | ||||||
Tax benefit from reduction of a capital loss valuation reserve | $ 4.6 | |||||
Adjustments for New Accounting Pronouncement | Adjustments for New Accounting Principle, Early Adoption | France | ||||||
Income Taxes [Line Items] | ||||||
Discrete tax benefits related to valuation allowance release | $ 8 | |||||
Adjustments for New Accounting Pronouncement | Adjustments for New Accounting Principle, Early Adoption | After Effect of Tax Cuts and Jobs Act | ||||||
Income Taxes [Line Items] | ||||||
Income tax rate | 77.40% | |||||
Scenario, Plan | ||||||
Income Taxes [Line Items] | ||||||
U.S. federal corporate tax rate | 21.00% |
Long-Term Debt (Detail)
Long-Term Debt (Detail) - USD ($) $ in Thousands | Jun. 29, 2018 | Sep. 29, 2017 |
Debt Instrument [Line Items] | ||
Credit facility | $ 25,000 | $ 50,000 |
Government refundable advances | 44,068 | 45,549 |
Obligation under capital leases | 69,817 | 71,091 |
Debt issuance costs | (3,920) | (4,654) |
Total long-term debt | 736,129 | 776,848 |
Less current maturities | 15,245 | 17,424 |
Carrying amount of long-term debt | 720,884 | 759,424 |
U.S. Credit Facility | ||
Debt Instrument [Line Items] | ||
Credit facility | 25,000 | 50,000 |
U.S. Term Loan, due April 2020 | ||
Debt Instrument [Line Items] | ||
Term Loan | 215,625 | 225,000 |
3.625% Senior Notes, due April 2023 | ||
Debt Instrument [Line Items] | ||
Senior Notes | $ 385,539 | $ 389,862 |
Long-Term Debt (Parenthetical)
Long-Term Debt (Parenthetical) (Detail) | 9 Months Ended | 12 Months Ended | |
Jun. 29, 2018 | Sep. 29, 2017 | Apr. 30, 2015 | |
3.625% Senior Notes, due April 2023 | |||
Debt Instrument [Line Items] | |||
Long-term debt interest rate | 3.625% | 3.625% | 3.625% |
Debt instruments maturity period | 2023-04 | 2023-04 | |
U.S. Term Loan, due April 2020 | |||
Debt Instrument [Line Items] | |||
Debt instruments maturity period | 2020-04 | 2020-04 |
Debt - Additional Information (
Debt - Additional Information (Detail) € in Millions | Aug. 03, 2015USD ($) | Apr. 09, 2015USD ($) | Apr. 30, 2015USD ($) | Jun. 29, 2018USD ($) | Sep. 29, 2017USD ($) | Apr. 30, 2015EUR (€) |
Debt Instrument [Line Items] | ||||||
Credit facilities | $ 25,000,000 | $ 50,000,000 | ||||
Imputed interest on advance | 2.52% | |||||
Government refundable advances | $ 44,068,000 | 45,549,000 | ||||
Present value of minimum lease payment | $ 67,600,000 | $ 69,000,000 | ||||
U.S. Term Loan, due April 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Loan amortization rate | 1.25% | |||||
Debt instrument original principal balance maturity period | 2020-03 | |||||
Debt instruments maturity period | 2020-04 | 2020-04 | ||||
3.625% Senior Notes, Due April 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Debt instruments maturity period | 2023-04 | 2023-04 | ||||
Debt instrument, interest rate | 3.625% | 3.625% | 3.625% | |||
Fair market value of long-term debt and short-term borrowings | $ 388,900,000 | $ 403,200,000 | ||||
3.625% Senior Notes, Due April 2023 | TA Mfg Limited | ||||||
Debt Instrument [Line Items] | ||||||
Debt issuance costs | $ 5,900,000 | |||||
Debt instrument, face amount | € | € 330 | |||||
Debt instrument, interest rate | 3.625% | |||||
Net proceeds from issuance of debt | $ 350,800,000 | |||||
3.625% Senior Notes, Due April 2023 | Debt Redemption After April 15, 2018 | TA Mfg Limited | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument redemption price percentage plus accrued interest | 102.719% | |||||
3.625% Senior Notes, Due April 2023 | Debt Redemption After April 15, 2021 | TA Mfg Limited | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument redemption price percentage plus accrued interest | 100.00% | |||||
London Interbank Offered Rate (LIBOR) | U.S. Term Loan, due April 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, basis spread on variable rate | 1.50% | |||||
Interest rate | 3.60% | |||||
London Interbank Offered Rate (LIBOR) | Minimum | U.S. Term Loan, due April 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, basis spread on variable rate | 1.25% | |||||
London Interbank Offered Rate (LIBOR) | Maximum | U.S. Term Loan, due April 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, basis spread on variable rate | 2.00% | |||||
Delayed-Draw Term Loan Facility | U.S. Term Loan, due April 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Funds borrowed under the delayed-draw term Loan | $ 250,000,000 | |||||
Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility maturity date | Apr. 9, 2020 | |||||
Debt issuance costs | $ 2,300,000 | |||||
Credit facilities | $ 25,000,000 | |||||
Secured Debt | London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, basis spread on variable rate | 1.50% | |||||
Interest rate | 3.60% | |||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, basis spread on variable rate | 1.25% | |||||
Secured Debt | London Interbank Offered Rate (LIBOR) | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, basis spread on variable rate | 2.00% | |||||
Secured Debt | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility maximum borrowing capacity | $ 500,000,000 | |||||
Secured Debt | Delayed-Draw Term Loan Facility | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility maximum borrowing capacity | $ 250,000,000 |
Employee Stock Plans - Addition
Employee Stock Plans - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Jun. 29, 2018 | Jun. 30, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Share-based compensation | $ 9,424 | $ 7,549 |
Shares issued under share-based compensation plans | 60,479 | 532,491 |
Restricted Stock Units | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Granted | 45,985 | 37,100 |
Weighted Average Grant Date Fair Value | $ 86.26 | $ 76.83 |
Performance Share Plan Shares | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Granted | 33,700 | 43,650 |
Performance period | 3 years | |
Performance Share Plan Shares | Minimum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Percentage of the target number of shares paid out | 0.00% | |
Performance Share Plan Shares | Maximum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Percentage of the target number of shares paid out | 300.00% | |
Employee Share-save Scheme | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Discount rate of market value on purchase date | 5.00% | |
The term of options, years | 3 years | |
Number of options granted | 20,981 | 11,338 |
Weighted-average grant date fair value of options granted | $ 22.67 | $ 24.61 |
Equity Incentive Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of options granted | 239,680 | 237,200 |
Weighted-average grant date fair value of options granted | $ 30.80 | $ 32.66 |
Employee Stock Purchase Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Discount rate of market value on purchase date | 5.00% |
Schedule of Fair Value of Award
Schedule of Fair Value of Awards using Black-Scholes Pricing Model (Detail) - Employee Share-save Scheme - USD ($) | 9 Months Ended | |
Jun. 29, 2018 | Jun. 30, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Volatility | 38.89% | 35.58% |
Risk-free interest rate | 1.98% | 1.75% |
Expected life (years) | 3 years | 3 years |
Dividends | $ 0 | $ 0 |
Schedule of Fair Value of Optio
Schedule of Fair Value of Option Granted using Black-Scholes Pricing Model (Detail) - Equity Incentive Plan - USD ($) | 9 Months Ended | |
Jun. 29, 2018 | Jun. 30, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Volatility | 34.32% | |
Volatility, minimum | 34.97% | |
Volatility, maximum | 35.42% | |
Risk-free interest rate, minimum | 2.15% | 1.98% |
Risk-free interest rate, maximum | 2.47% | 2.51% |
Dividends | $ 0 | $ 0 |
Minimum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected life (years) | 5 years | 5 years |
Maximum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected life (years) | 9 years | 9 years |
Discontinued Operations - Addit
Discontinued Operations - Additional Information (Detail) $ in Thousands, £ in Millions | Jun. 29, 2018USD ($) | Jun. 29, 2018GBP (£) | Mar. 15, 2018USD ($) | Mar. 28, 2017USD ($) | May 04, 2016GBP (£) | Dec. 29, 2017USD ($) | Dec. 29, 2017GBP (£) | Jun. 29, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 29, 2018USD ($) | Jun. 30, 2017USD ($) |
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||||||||
Sale of discontinued operation | $ 50,000 | $ 47,814 | $ 600 | ||||||||
Gain on sale of discontinued operation | $ (395) | 0 | 793 | ||||||||
Loss from Discontinued Operations Attributable to Esterline, Net of Tax | $ (1,894) | (815) | (2,137) | (6,185) | |||||||
Loss on net assets held for sale | $ (2,175) | $ 872 | $ (780) | (3,537) | |||||||
Wallop | |||||||||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||||||||
Sale of discontinued operation | £ | £ 2.5 | ||||||||||
Deferred consideration payments term | 3 years | ||||||||||
Deferred consideration payment date | May 3, 2019 | ||||||||||
Payments for earn out | $ 6,500 | £ 4.9 | |||||||||
Deferred consideration earned | $ 1,800 | £ 1.3 | |||||||||
Loss on net assets held for sale | $ 3,600 | ||||||||||
Wallop | Maximum | |||||||||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||||||||
Deferred consideration payments | £ | £ 9 | ||||||||||
Indemnity obligations losses for buyer | £ | £ 5 | ||||||||||
Deferred consideration payable acceptable orders percentage | 31.00% | ||||||||||
Wallop | Minimum | |||||||||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||||||||
Deferred consideration payable acceptable orders percentage | 26.50% | ||||||||||
Small Manufacturing Business | |||||||||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||||||||
Sale of discontinued operation | $ 600 | ||||||||||
Discontinued operation, note receivable | 2,400 | ||||||||||
Gain on sale of discontinued operation | $ 800 | ||||||||||
Discontinued operation, note receivable due date | Mar. 28, 2021 | ||||||||||
Discontinued operation ,note receivable interest rate | 2.05% |
Discontinued Operations Income
Discontinued Operations Income (Loss) Net of Tax (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Net Sales | $ 0 | $ 270 | $ 0 | $ 5,234 |
Operating earnings (loss) | (2,651) | (1,195) | (3,308) | (7,930) |
Tax expense (benefit) | (757) | (380) | (1,171) | (1,745) |
Income (loss) from discontinued operations | (1,894) | (815) | (2,137) | (6,185) |
Included in Operating Earnings (Loss): | ||||
Gain (loss) on net assets held for sale | (2,175) | 872 | (780) | (3,537) |
Gain on sale of discontinued operations | (395) | 0 | 793 | |
Avionics & Controls | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Net Sales | 0 | 0 | 0 | 4,964 |
Operating earnings (loss) | (1,182) | (594) | (299) | (713) |
Tax expense (benefit) | (35) | (62) | (2) | (492) |
Income (loss) from discontinued operations | (1,147) | (532) | (297) | (221) |
Included in Operating Earnings (Loss): | ||||
Gain (loss) on net assets held for sale | (1,041) | 163 | (291) | 77 |
Gain on sale of discontinued operations | (395) | 793 | ||
Sensors & Systems | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Net Sales | 0 | 0 | 0 | 0 |
Operating earnings (loss) | 0 | 0 | 0 | 893 |
Tax expense (benefit) | 0 | 0 | 0 | 0 |
Income (loss) from discontinued operations | 0 | 0 | 0 | 893 |
Included in Operating Earnings (Loss): | ||||
Gain (loss) on net assets held for sale | 0 | 0 | 0 | 0 |
Gain on sale of discontinued operations | 0 | 0 | ||
Advanced Materials | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Net Sales | 0 | 270 | 0 | 270 |
Operating earnings (loss) | (1,452) | (598) | (2,942) | (7,214) |
Tax expense (benefit) | (722) | (318) | (1,156) | (941) |
Income (loss) from discontinued operations | (730) | (280) | (1,786) | (6,273) |
Included in Operating Earnings (Loss): | ||||
Gain (loss) on net assets held for sale | (1,134) | 709 | (489) | (3,614) |
Gain on sale of discontinued operations | 0 | 0 | ||
Other | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Net Sales | 0 | 0 | 0 | 0 |
Operating earnings (loss) | (17) | (3) | (67) | (896) |
Tax expense (benefit) | 0 | 0 | (13) | (312) |
Income (loss) from discontinued operations | (17) | (3) | (54) | (584) |
Included in Operating Earnings (Loss): | ||||
Gain (loss) on net assets held for sale | $ 0 | 0 | $ 0 | 0 |
Gain on sale of discontinued operations | $ 0 | $ 0 |
Discontinued Operations Assets
Discontinued Operations Assets and Liabilities Held for Sale (Detail) - USD ($) $ in Thousands | Jun. 29, 2018 | Sep. 29, 2017 |
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||
Other current assets | $ 4,052 | $ 6,501 |
Current Assets of Businesses Held for Sale | 4,052 | 6,501 |
Net property, plant and equipment | 4,221 | 5,262 |
Other assets | 8,411 | 8,072 |
Non-Current Assets of Businesses Held for Sale | 12,632 | 13,334 |
Accounts payable | 12 | 138 |
Accrued liabilities | 3,200 | 7,046 |
Current Liabilities of Businesses Held for Sale | 3,212 | 7,184 |
Deferred income tax liabilities | 2,590 | 1,404 |
Other liabilities | 320 | 320 |
Non-Current Liabilities of Businesses Held for Sale | 2,910 | 1,724 |
Net Assets of Businesses Held for Sale | 10,562 | 10,927 |
Avionics & Controls | ||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||
Other current assets | 0 | 0 |
Current Assets of Businesses Held for Sale | 0 | 0 |
Net property, plant and equipment | 4,221 | 5,262 |
Other assets | 0 | 0 |
Non-Current Assets of Businesses Held for Sale | 4,221 | 5,262 |
Accounts payable | 0 | 0 |
Accrued liabilities | 0 | 0 |
Current Liabilities of Businesses Held for Sale | 0 | 0 |
Deferred income tax liabilities | 0 | 0 |
Other liabilities | 0 | 0 |
Non-Current Liabilities of Businesses Held for Sale | 0 | 0 |
Net Assets of Businesses Held for Sale | 4,221 | 5,262 |
Sensors & Systems | ||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||
Other current assets | 0 | 0 |
Current Assets of Businesses Held for Sale | 0 | 0 |
Net property, plant and equipment | 0 | 0 |
Other assets | 0 | 0 |
Non-Current Assets of Businesses Held for Sale | 0 | 0 |
Accounts payable | 0 | 0 |
Accrued liabilities | 0 | 0 |
Current Liabilities of Businesses Held for Sale | 0 | 0 |
Deferred income tax liabilities | 0 | 0 |
Other liabilities | 0 | 0 |
Non-Current Liabilities of Businesses Held for Sale | 0 | 0 |
Net Assets of Businesses Held for Sale | 0 | 0 |
Advanced Materials | ||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||
Other current assets | 4,052 | 6,501 |
Current Assets of Businesses Held for Sale | 4,052 | 6,501 |
Net property, plant and equipment | 0 | 0 |
Other assets | 8,411 | 8,072 |
Non-Current Assets of Businesses Held for Sale | 8,411 | 8,072 |
Accounts payable | 12 | 138 |
Accrued liabilities | 3,200 | 7,046 |
Current Liabilities of Businesses Held for Sale | 3,212 | 7,184 |
Deferred income tax liabilities | 2,590 | 1,404 |
Other liabilities | 320 | 320 |
Non-Current Liabilities of Businesses Held for Sale | 2,910 | 1,724 |
Net Assets of Businesses Held for Sale | $ 6,341 | $ 5,665 |
Business Segment Information fo
Business Segment Information for Continuing Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Segment Reporting Information [Line Items] | ||||
Sales | $ 499,871 | $ 504,107 | $ 1,499,545 | $ 1,471,654 |
Interest income | 579 | 150 | 1,326 | 346 |
Interest expense | (7,902) | (7,299) | (23,673) | (22,645) |
Earnings from Continuing Operations Before Income Taxes | 40,969 | 42,745 | 86,502 | 111,721 |
Avionics & Controls | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 210,787 | 209,168 | 626,304 | 615,143 |
Sensors & Systems | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 190,895 | 184,804 | 564,516 | 535,287 |
Advanced Materials | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 98,189 | 110,135 | 308,725 | 321,224 |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Segment Earnings | 67,068 | 65,863 | 166,246 | 187,254 |
Operating Segments | Avionics & Controls | ||||
Segment Reporting Information [Line Items] | ||||
Segment Earnings | 23,781 | 22,496 | 67,839 | 61,185 |
Operating Segments | Sensors & Systems | ||||
Segment Reporting Information [Line Items] | ||||
Segment Earnings | 22,135 | 25,587 | 53,119 | 70,087 |
Operating Segments | Advanced Materials | ||||
Segment Reporting Information [Line Items] | ||||
Segment Earnings | 21,152 | 17,780 | 45,288 | 55,982 |
Corporate Non Segment | ||||
Segment Reporting Information [Line Items] | ||||
Corporate expense | $ (18,776) | $ (15,969) | $ (57,397) | $ (53,234) |