Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Mar. 14, 2014 | Jun. 30, 2013 | |
Document and Entity Information | ' | ' | ' |
Entity Registrant Name | 'ALLIED MOTION TECHNOLOGIES INC | ' | ' |
Entity Central Index Key | '0000046129 | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Amendment Flag | 'false | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Filer Category | 'Smaller Reporting Company | ' | ' |
Entity Public Float | ' | ' | $46,864,794 |
Entity Common Stock, Shares Outstanding | ' | 9,240,498 | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current Assets: | ' | ' |
Cash and cash equivalents | $10,171 | $9,728 |
Trade receivables, net of allowance for doubtful accounts of $802 and $177 at December 31, 2013 and 2012, respectively | 27,123 | 10,806 |
Inventories, net | 24,430 | 14,701 |
Deferred income taxes | 2,961 | 639 |
Prepaid expenses and other assets | 2,602 | 2,155 |
Total Current Assets | 67,287 | 38,029 |
Property, plant and equipment, net | 40,111 | 8,631 |
Deferred income taxes | 3,246 | 4,103 |
Intangible assets, net | 35,222 | 2,431 |
Goodwill | 20,233 | 5,782 |
Other long term assets | 4,878 | 1,991 |
Total Assets | 170,977 | 60,967 |
Current Liabilities: | ' | ' |
Debt obligations | 14,145 | 397 |
Accounts payable | 15,478 | 5,748 |
Accrued liabilities | 9,898 | 5,926 |
Income taxes payable | 2,729 | ' |
Total Current Liabilities | 42,250 | 12,071 |
Long-term debt | 73,500 | ' |
Deferred income taxes | 2,327 | 935 |
Deferred compensation arrangements | 2,599 | 1,997 |
Pension and post-retirement obligations | 2,298 | 3,812 |
Total Liabilities | 122,974 | 18,815 |
Commitments and Contingencies | ' | ' |
Stockholders' Equity: | ' | ' |
Common stock, no par value, authorized 50,000 shares; 9,091 and 8,631 shares issued and outstanding at December 31, 2013 and 2012, respectively | 23,771 | 22,547 |
Preferred stock, par value $1.00 per share, authorized 5,000 shares; no shares issued or outstanding | ' | ' |
Retained earnings | 23,608 | 20,528 |
Accumulated other comprehensive income (loss) | 624 | -923 |
Total Stockholders' Equity | 48,003 | 42,152 |
Total Liabilities and Stockholders' Equity | $170,977 | $60,967 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, except Per Share data, unless otherwise specified | ||
CONSOLIDATED BALANCE SHEETS | ' | ' |
Trade receivables, allowance for doubtful accounts (in dollars) | $802 | $177 |
Common stock, par value (in dollars per share) | ' | ' |
Common stock, authorized shares | 50,000 | 50,000 |
Common stock, shares issued | 9,091 | 8,631 |
Common stock, shares outstanding | 9,091 | 8,631 |
Preferred stock, par value (in dollars per share) | $1 | $1 |
Preferred stock, authorized shares | 5,000 | 5,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
CONSOLIDATED_STATEMENTS_OF_INC
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (USD $) | 12 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | ||
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | ' | ' | ||
Revenues | $125,502 | $101,968 | ||
Cost of goods sold | 88,980 | 72,328 | ||
Gross margin | 36,522 | 29,640 | ||
Operating costs and expenses: | ' | ' | ||
Selling | 5,513 | 5,093 | ||
General and administrative | 13,048 | 10,643 | ||
Engineering and development | 7,931 | 6,060 | ||
Business development | 1,913 | 24 | ||
Relocation | 234 | ' | ||
Amortization of intangible assets | 825 | 548 | ||
Total operating costs and expenses | 29,464 | 22,368 | ||
Operating income | 7,058 | 7,272 | ||
Other expense (income): | ' | ' | ||
Interest expense | 1,445 | 13 | ||
Other expense (income), net | -168 | -239 | ||
Total other expense (income) , net | 1,277 | -226 | ||
Income before income taxes | 5,781 | 7,498 | ||
Provision for income taxes | -1,828 | -2,101 | ||
Net income | 3,953 | 5,397 | ||
Foreign currency translation adjustment | 652 | 624 | ||
Change in accumulated income (loss) on derivatives | 41 | ' | ||
Pension adjustments | 854 | [1] | -331 | [1] |
Comprehensive income | $5,500 | $5,690 | ||
Basic earnings per share: | ' | ' | ||
Earnings per share (in dollars per share) | $0.45 | $0.63 | ||
Basic weighted average common shares (in shares) | 8,833 | 8,616 | ||
Diluted earnings per share: | ' | ' | ||
Earnings per share (in dollars per share) | $0.45 | $0.63 | ||
Diluted weighted average common shares (in shares) | 8,840 | 8,616 | ||
[1] | Net of tax of $480 and $(185) for the periods ending December 31, 2013 and 2012, respectively. |
CONSOLIDATED_STATEMENTS_OF_INC1
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Parenthetical) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | ' | ' |
Tax portion on pension adjustments | $480 | ($185) |
CONSOLIDATED_STATEMENTS_OF_STO
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (USD $) | Total | Common Stock | Unamortized Cost of Equity Awards | Retained Earnings | Foreign Currency Translation Adjustments | Accumulated income (loss) on derivatives | Pension Adjustments |
In Thousands, unless otherwise specified | |||||||
Balances at Dec. 31, 2011 | $36,322 | $22,258 | ($690) | $15,970 | ($503) | ' | ($713) |
Balances (in shares) at Dec. 31, 2011 | ' | 8,466 | ' | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' |
Stock transactions under employee benefit stock plans and option exercises | 494 | 494 | ' | ' | ' | ' | ' |
Stock transactions under employee benefit stock plans and option exercises (in shares) | ' | 68 | ' | ' | ' | ' | ' |
Issuance of restricted stock, net of forfeitures | -124 | 722 | -846 | ' | ' | ' | ' |
Issuance of restricted stock, net of forfeitures (in shares) | ' | 97 | ' | ' | ' | ' | ' |
Stock compensation expense | 609 | ' | 609 | ' | ' | ' | ' |
Comprehensive income (loss) | 108 | ' | ' | ' | 624 | ' | -516 |
Tax effect | 185 | ' | ' | ' | ' | ' | 185 |
Net income | 5,397 | ' | ' | 5,397 | ' | ' | ' |
Dividends to Stockholders | -839 | ' | ' | -839 | ' | ' | ' |
Balances at Dec. 31, 2012 | 42,152 | 23,474 | -927 | 20,528 | 121 | ' | -1,044 |
Balances (in shares) at Dec. 31, 2012 | 8,631 | 8,631 | ' | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' |
Stock transactions under employee benefit stock plans and option exercises | 420 | 420 | ' | ' | ' | ' | ' |
Stock transactions under employee benefit stock plans and option exercises (in shares) | ' | 61 | ' | ' | ' | ' | ' |
Issuance of restricted stock, net of forfeitures | -123 | 3,141 | -3,264 | ' | ' | ' | ' |
Issuance of restricted stock, net of forfeitures (in shares) | ' | 399 | ' | ' | ' | ' | ' |
Stock compensation expense | 927 | ' | 927 | ' | ' | ' | ' |
Comprehensive income (loss) | 2,027 | ' | ' | ' | 652 | 41 | 1,334 |
Tax effect | -480 | ' | ' | ' | ' | ' | -480 |
Net income | 3,953 | ' | ' | 3,953 | ' | ' | ' |
Dividends to Stockholders | -873 | ' | ' | -873 | ' | ' | ' |
Balances at Dec. 31, 2013 | $48,003 | $27,035 | ($3,264) | $23,608 | $773 | $41 | ($190) |
Balances (in shares) at Dec. 31, 2013 | 9,091 | 9,091 | ' | ' | ' | ' | ' |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Cash Flows From Operating Activities: | ' | ' |
Net income | $3,953 | $5,397 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 2,913 | 1,798 |
Deferred income taxes | 90 | 782 |
Provision for excess and obsolete inventory | 105 | 265 |
Restricted Stock Compensation | 927 | 609 |
Other | -52 | 773 |
Changes in operating assets and liabilities, excluding changes due to acquisition: | ' | ' |
(Increase) decrease in trade receivables, net | 196 | 992 |
(Increase) decrease in inventories | 1,763 | -400 |
(Increase) decrease in prepaid expenses and other | -561 | -1,999 |
Increase (decrease) in accounts payable | 558 | -893 |
Increase (decrease) in accrued liabilities and other | -617 | -692 |
Increase (decrease) in income taxes payable | 1,504 | -2,028 |
Net cash provided by operating activities | 10,779 | 4,604 |
Cash Flows From Investing Activities: | ' | ' |
Consideration paid for acquisition, net of cash acquired | -91,607 | -1,350 |
Purchase of property and equipment | -3,087 | -2,597 |
Net cash used in investing activities | -94,694 | -3,947 |
Cash Flows From Financing Activities: | ' | ' |
Borrowings (repayments) on lines-of-credit, net | 8,475 | 230 |
Proceeds from issuance of long-term debt | 80,000 | ' |
Principal payments of long-term debt | -1,250 | ' |
Payment of debt issuance costs | -2,377 | ' |
Dividends paid to stockholders | -873 | -839 |
Stock transactions under employee benefit stock plans | 434 | 365 |
Net cash (used in) provided by financing activities | 84,409 | -244 |
Effect of foreign exchange rate changes on cash | -51 | 160 |
Net increase in cash and cash equivalents | 443 | 573 |
Cash and cash equivalents at beginning of period | 9,728 | 9,155 |
Cash and cash equivalents at end of period | 10,171 | 9,728 |
Net cash paid during the period for: | ' | ' |
Interest | 1,326 | 18 |
Income taxes | $1,099 | $3,223 |
BUSINESS_AND_SUMMARY_OF_SIGNIF
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||
1. BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||||||||
Business | |||||||||||
Allied Motion Technologies Inc. (Allied Motion or the Company) is engaged in the business of designing, manufacturing and selling motion control solutions, which include integrated system solutions as well as individual motion control products, to a broad spectrum of customers throughout the world primarily for the commercial motor, industrial motion, automotive control, medical, and aerospace and defense markets. | |||||||||||
Principles of Consolidation | |||||||||||
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant inter-company accounts and transactions are eliminated in consolidation. | |||||||||||
Acquisitions are accounted for under the acquisition method and, accordingly, the operating results for Globe Motors, Inc. (Note 2.) are included in the consolidated statements of income and comprehensive income from October 18, 2013, the date of acquisition. | |||||||||||
Cash and Cash Equivalents | |||||||||||
Cash and cash equivalents include instruments which are readily convertible into cash (original maturities of three months or less) and which are not subject to significant risk of changes in interest rates. Cash flows from foreign currency transactions are translated using an average rate. | |||||||||||
Accounts Receivable | |||||||||||
Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses in the Company's existing accounts receivable; however, changes in circumstances relating to accounts receivable may result in a requirement for additional allowances in the future. | |||||||||||
Activity in the allowance for doubtful accounts for 2013 and 2012 was as follows (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Beginning balance | $ | 177 | $ | 284 | |||||||
Allowance for doubtful accounts acquired | 460 | — | |||||||||
Additional reserves | 164 | (25 | ) | ||||||||
Writeoffs | 1 | (82 | ) | ||||||||
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Ending balance | $ | 802 | $ | 177 | |||||||
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Inventories | |||||||||||
Inventories include costs of materials, direct labor and manufacturing overhead, and are stated at the lower of cost (first-in, first-out basis) or market, as follows (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Parts and raw materials | $ | 20,649 | $ | 13,174 | |||||||
Work-in-process | 3,369 | 1,504 | |||||||||
Finished goods | 4,350 | 2,096 | |||||||||
| | | | | | | | ||||
28,368 | 16,774 | ||||||||||
Less reserves | (3,938 | ) | (2,073 | ) | |||||||
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Inventories, net | $ | 24,430 | $ | 14,701 | |||||||
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The Company recorded provisions for excess and obsolete inventories of approximately $105 and $265, for 2013 and 2012, respectively. | |||||||||||
Property, Plant and Equipment | |||||||||||
Property, plant and equipment is classified as follows (in thousands): | |||||||||||
Useful lives | December 31, | December 31, | |||||||||
2013 | 2012 | ||||||||||
Land | $ | 3,020 | $ | 290 | |||||||
Building and improvements | 5 - 39 years | 7,382 | 3,713 | ||||||||
Machinery, equipment, tools and dies | 3 - 15 years | 40,237 | 13,483 | ||||||||
Furniture, fixtures and other | 3 - 10 years | 4,544 | 3,996 | ||||||||
| | | | | | | | | | ||
55,183 | 21,482 | ||||||||||
Less accumulated depreciation | (15,072 | ) | (12,851 | ) | |||||||
| | | | | | | | | | ||
Property, plant and equipment, net | $ | 40,111 | $ | 8,631 | |||||||
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Depreciation expense is provided using the straight-line method over the estimated useful lives of the assets. Amortization of building improvements is provided using the straight-line method over the life of the lease term or the life of the assets, whichever is shorter. Maintenance and repair costs are charged to operations as incurred. Major additions and improvements are capitalized. The cost and related accumulated depreciation of retired or sold property are removed from the accounts and the resulting gain or loss, if any, is reflected in earnings. | |||||||||||
Depreciation expense was approximately $2,088 and $1,250 in 2013 and 2012, respectively. | |||||||||||
Computer software and software development costs incurred in connection with developing or obtaining computer software for internal use that has an extended useful life are capitalized. These costs are amortized over their estimated useful life of seven years. During 2013 and 2012, software costs of $488 and $1,072, respectively, were capitalized. ERP software and implementation related costs are included within furniture, fixtures and other in the property, plant and equipment table. | |||||||||||
Intangible Assets | |||||||||||
Intangible assets, other than goodwill, are recorded at cost and are amortized over their estimated useful lives using the straight-line method. | |||||||||||
Impairment of Long-Lived Assets | |||||||||||
The Company reviews the carrying values of its long-lived assets, including property, plant and equipment and intangible assets, whenever events or changes in circumstances indicate that such carrying values may not be recoverable. Long-lived assets are carried at historical cost if the projected cash flows from their use will recover their carrying amounts on an undiscounted basis and without considering interest. If projected cash flows are less than their carrying value, the long-lived assets must be reduced to their estimated fair value. Considerable judgment is required to project such cash flows and, if required, estimate the fair value of the impaired long-lived asset. | |||||||||||
Goodwill | |||||||||||
Goodwill represents the excess of the purchase price over the fair value of identifiable net tangible and intangible assets acquired in a business combination. | |||||||||||
Goodwill is tested annually for impairment or more frequently if events or changes in circumstances indicate that impairment may have occurred. We have the option to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. Otherwise, the impairment analysis for goodwill includes a comparison of our carrying value (including goodwill) to our estimated fair value. If the fair value does not exceed the carrying value, then an additional analysis would be performed to allocate the fair value to all of our assets and liabilities as if it had been acquired in a business combination and the fair value was our purchase price. If the excess of the fair value of our identifiable assets and liabilities is less than the carrying value of recorded goodwill, an impairment charge is recorded for the difference. | |||||||||||
The Company did not record any such impairment for the twelve months ended December 31, 2013 and 2012. | |||||||||||
Other Long-term Assets | |||||||||||
Other long-term assets are securities that the Company has purchased with the intent of funding the deferred compensation arrangements for certain executives of the Company. These securities are accounted for at fair value on a recurring basis. Any changes to the value of these securities held by the Company are included in Net Income in the Company's consolidated statements of income and comprehensive income. | |||||||||||
Warranty | |||||||||||
The Company offers warranty coverage for its products. The length of the warranty period for its products varies significantly based on the product being sold. The Company estimates the costs of repairing products under warranty based on the historical average cost of the repairs. The assumptions used to estimate warranty accruals are reevaluated periodically in light of actual experience and, when appropriate, the accruals are adjusted. Estimated warranty costs are recorded at the time of sale of the related product, and are considered a cost of sale. | |||||||||||
Changes in the Company's reserve for product warranty claims during 2013 and 2012 were as follows (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Warranty reserve at beginning of the year | $ | 551 | $ | 372 | |||||||
Warranty reserves acquired | 429 | — | |||||||||
Provision | 175 | 579 | |||||||||
Warranty expenditures | (529 | ) | (411 | ) | |||||||
Effect of foreign currency translation | 3 | 11 | |||||||||
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Warranty reserve at end of year | $ | 629 | $ | 551 | |||||||
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In 2012, of the $579 of warranty provision, $342 was recorded to cover the expected costs of replacing certain products in the field due to an incorrect electronic component in a printed circuit board supplied by one of the Company's sub-contract suppliers. In 2013, $44 of additional provision was recorded, and $367 of warranty expenditures were incurred related to this issue. The remaining reserve balance is $30, net of the effect of foreign currency translation. | |||||||||||
Accrued Liabilities | |||||||||||
Accrued liabilities consist of the following (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Compensation and fringe benefits | $ | 6,721 | $ | 4,230 | |||||||
Warranty reserve | 629 | 551 | |||||||||
Other accrued expenses | 2,548 | 1,145 | |||||||||
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$ | 9,898 | $ | 5,926 | ||||||||
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Foreign Currency Translation | |||||||||||
The assets and liabilities of the Company's foreign subsidiaries are translated into U.S. dollars using end of period exchange rates. Changes in reported amounts of assets and liabilities of foreign subsidiaries that occur as a result of changes in exchange rates between foreign subsidiaries' functional currencies and the U.S. dollar are included in foreign currency translation adjustment. Foreign currency translation adjustment is included in other comprehensive income, a component of stockholders' equity in the accompanying consolidated statements of stockholders' equity. Revenue and expense transactions use an average rate prevailing during the month of the related transaction. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency of each Technology Unit ("TU") are included in the results of operations as incurred. | |||||||||||
Engineering and Development Costs | |||||||||||
The Company is engaged in a variety of engineering and design activities as well as basic research and development activities directed to the substantial improvement or new application of the Company's existing technologies. Engineering and development costs are expensed as incurred. | |||||||||||
Revenue Recognition | |||||||||||
The Company recognizes revenue when products are shipped or delivered (shipping terms may be either FOB shipping point or destination) and title has passed to the customer, persuasive evidence of an arrangement exists, the selling price is fixed or determinable, and collectability is reasonably assured. | |||||||||||
Basic and Diluted Income per Share from Continuing Operations | |||||||||||
Basic income per share is computed by dividing net income or loss by the weighted average number of shares of common stock outstanding. Diluted income per share is determined by dividing the net income by the sum of (1) the weighted average number of common shares outstanding and (2) if not anti-dilutive, the effect of stock awards determined utilizing the treasury stock method. The dilutive effect of outstanding awards was 7 and 0 shares for the years 2013 and 2012, respectively. No stock awards were excluded from the calculation of diluted income per share for years 2013 and 2012. | |||||||||||
Comprehensive Income | |||||||||||
Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. It includes all changes in equity during a period except those resulting from investments by and distributions to stockholders. | |||||||||||
Fair Value Accounting | |||||||||||
Authoritative guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. | |||||||||||
The guidance establishes a framework for measuring fair value which utilizes observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company's market assumptions. Preference is given to observable inputs. These two types of inputs create the following three-level fair value hierarchy: | |||||||||||
Level 1: | Quoted prices for identical assets or liabilities in active markets. | ||||||||||
Level 2: | Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations whose inputs or significant value drivers are observable. | ||||||||||
Level 3: | Significant inputs to the valuation model that are unobservable. | ||||||||||
The Company's financial assets and liabilities include cash and cash equivalents, accounts receivable, debt obligations, accounts payable, and accrued liabilities. The carrying amounts reported in the consolidated balance sheets for these assets approximate fair value because of the immediate or short-term maturities of these financial instruments. | |||||||||||
The following table presents the Company's financial assets that are accounted for at fair value on a recurring basis as of December 31, 2013 and December 31, 2012, respectively, by level within the fair value hierarchy (in thousands): | |||||||||||
December 31, 2013 | |||||||||||
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Pension Plan Assets | $ | 4,847 | $ | — | $ | — | |||||
Other long term assets | 2,595 | — | — | ||||||||
Interest rate swaps | — | 41 | — | ||||||||
December 31, 2012 | |||||||||||
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Pension Plan Assets | $ | 4,086 | $ | — | $ | — | |||||
Other long term assets | 1,991 | — | — | ||||||||
Derivative Financial Instruments | |||||||||||
As required by ASC Topic 815, "Derivatives and Hedging," the Company records all derivatives on the balance sheets at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain of its risks, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. | |||||||||||
Income Taxes | |||||||||||
The Company accounts for income taxes in accordance with ASC Topic 740, "Income Taxes." Consistent with guidance in "Income Taxes," the current provision for income taxes represents actual or estimated amounts payable or refundable on tax return filings each year. Deferred tax assets and liabilities are recorded for the estimated future tax effects of temporary differences between the tax basis of assets and liabilities and amounts reported in the accompanying consolidated balance sheets, and for operating loss and tax credit carryforwards. The change in deferred tax assets and liabilities for the period measures the deferred tax provision or benefit for the period. Effects of changes in enacted tax laws on deferred tax assets and liabilities are reflected as adjustments to the tax provision or benefit in the period of enactment. A valuation allowance may be provided to the extent management deems it is more likely than not that deferred tax assets will not be realized. The ultimate realization of net deferred tax assets is dependent upon the generation of future taxable income, in the appropriate taxing jurisdictions, during the periods in which temporary differences, net operating losses and tax credits become realizable. Management believes that it is more likely than not that the Company will realize the benefits of these temporary differences and operating loss and tax credit carryforwards, net of valuation allowances. | |||||||||||
The guidance in "Income Taxes" requires that realization of an uncertain income tax position must have a "more likely than not" probability of being sustained based on technical merits before it can be recognized in the financial statements, assuming a review by tax authorities having all relevant information and applying current conventions. The Company does not have significant unrecognized tax benefits and does not anticipate a significant increase or decrease in unrecognized tax benefits within the next twelve months. Income tax related interest and penalties recognized in 2013 and 2012 are immaterial. | |||||||||||
Pension and Postretirement Welfare Plans | |||||||||||
The Company reports gains or losses and prior service costs or credits that arise during the period, but not recognized as components of net periodic benefit cost, as a component of other comprehensive income, net of tax, in accordance with ASC Topic 715, "Compensation—Retirement Benefits". Amounts recognized in accumulated other comprehensive income are adjusted as they are subsequently recognized as components of net periodic benefit cost pursuant to the recognition and amortization provisions of those Statements. | |||||||||||
Concentration of Credit Risk | |||||||||||
Trade receivables subject the Company to the potential for credit risk. To reduce this risk, the Company performs evaluations of its customers' financial condition and creditworthiness at the time of sale, and updates those evaluations when necessary. Three customers made up 42% of trade receivables as of December 31, 2013. No single customer made up more than 10% of trade receivables as of December 31, 2012. | |||||||||||
Use of Estimates | |||||||||||
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions. Such estimates and assumptions affect the reported amounts of assets and liabilities as well as disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |||||||||||
ACQUISITIONS
ACQUISITIONS | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
ACQUISITIONS | ' | ||||
ACQUISITIONS | ' | ||||
2. ACQUISITIONS | |||||
On August 22, 2013, Allied Motion Technologies Inc. ("Allied Motion") entered into a Stock Purchase Agreement (the "Purchase Agreement") to purchase all of the outstanding equity interests of Globe Motors, Inc., a Delaware corporation ("Globe Motors" or "Globe") from Safran USA, Inc. (the "Seller"), for approximately $90,000 in cash. The purchase price paid will be subject to adjustment to reflect, among other things, the working capital of Globe Motors at the time of closing. The acquisition closed on October 18, 2013. | |||||
Globe Motors is headquartered in Dayton, Ohio, and has manufacturing facilities located in the U.S, Portugal, and Mexico. The purchase price of $90,000 was comprised of $4,300 cash paid at closing, as well as funds acquired from the new Credit Agreement and Senior Subordinated Notes. | |||||
The Company incurred $1,913 of transaction costs related to the acquisition of Globe Motors. Transaction costs are included in Business development expenses on the consolidated statements of income and comprehensive income. | |||||
The Company accounted for the acquisition pursuant to ASC 805, "Business Combinations." The purchase price was allocated to the underlying net assets based on fair value as of the acquisition date, as follows (in thousands): | |||||
December 31, | |||||
2013 | |||||
Trade receivables, net | $ | 16,567 | |||
Inventories, net | 11,142 | ||||
Prepaid expenses and other assets | 2,860 | ||||
Property, plant and equipment | 30,304 | ||||
Amortizable intangible assets | 33,530 | ||||
Goodwill | 14,209 | ||||
Accounts payable | (10,622 | ) | |||
Accrued liabilities | (7,990 | ) | |||
| | | | | |
Net purchase price | $ | 90,000 | |||
| | | | | |
| | | | | |
The purchase price of $90,000 excludes any cash on hand and any debt of Globe Motors. The purchase price allocation is subject to further adjustment upon finalization of the opening balance sheet. | |||||
The intangible assets acquired consist of customer lists and a tradename, which are being amortized over 15 and 10 years, respectively. Goodwill generated in the acquisition is related to the assembled workforce, synergies between Allied Motion's other Technology Units ("TUs") and Globe Motors that will occur as a result of the combined engineering knowledge, the ability of each of the TU's to integrate each other's products into more fully integrated system solutions and Allied Motion's ability to utilize Globe's management knowledge in providing complementary product offerings to the Company's customers. | |||||
Pro forma Condensed Combined Financial Information (Unaudited) | |||||
The following presents the Company's unaudited pro forma financial information for the year ended December 31, 2013 giving effect to the acquisition of Globe Motors as if it had occurred at January 1, 2013. Included in the pro forma information is: the additional depreciation and amortization resulting from the valuation of amortizable tangible and intangible assets; interest on borrowings made by the Company; amortization of deferred finance costs incurred to issue the borrowings; removal of acquisition related transaction costs; removal of certain costs for which Allied Motion would be indemnified by the seller and stock compensation expense related to shares issued to certain executives of Allied Motion as a result of the acquisition. | |||||
For the year ended | |||||
December 31, 2013 | |||||
Revenues | $ | 220,692 | |||
Net income | $ | 7,984 | |||
Diluted net income per share | $ | 0.88 | |||
The pro forma adjustments do not reflect adjustments for anticipated operating efficiencies that the Company expects to achieve as a result of this acquisition. The pro forma financial information is for informational purposes only and does not purport to present what the Company's results would actually have been had these transactions actually occurred on the dates presented or to project the combined company's results of operations or financial position for any future period. | |||||
GOODWILL
GOODWILL | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
GOODWILL | ' | |||||||
GOODWILL | ' | |||||||
3. GOODWILL | ||||||||
The change in the carrying amount of goodwill for 2013 and 2012 is as follows (in thousands): | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Beginning balance | $ | 5,782 | $ | 5,665 | ||||
Goodwill acquired | 14,209 | — | ||||||
Effect of foreign currency translation | 242 | 117 | ||||||
| | | | | | | | |
Ending balance | $ | 20,233 | $ | 5,782 | ||||
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| | | | | | | | |
INTANGIBLE_ASSETS
INTANGIBLE ASSETS | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||
INTANGIBLE ASSETS | ' | |||||||||||||||||||||
INTANGIBLE ASSETS | ' | |||||||||||||||||||||
4. INTANGIBLE ASSETS | ||||||||||||||||||||||
Intangible assets on the Company's consolidated balance sheets consist of the following (in thousands): | ||||||||||||||||||||||
December 31, 2013 | December 31, 2012 | |||||||||||||||||||||
Life | Gross | Accumulated | Net Book | Gross | Accumulated | Net Book | ||||||||||||||||
Amount | amortization | Value | Amount | amortization | Value | |||||||||||||||||
Customer lists | 8 - 15 years | $ | 34,166 | $ | (3,821 | ) | $ | 30,345 | $ | 4,364 | $ | (3,212 | ) | $ | 1,152 | |||||||
Trade name | 10 years | 4,775 | (1,012 | ) | 3,763 | 946 | (889 | ) | 57 | |||||||||||||
Design and technologies | 8 - 10 years | 2,730 | (1,637 | ) | 1,093 | 2,626 | (1,427 | ) | 1,199 | |||||||||||||
Patents | 24 | (3 | ) | 21 | 24 | (1 | ) | 23 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | |
Total | $ | 41,695 | $ | (6,473 | ) | $ | 35,222 | $ | 7,960 | $ | (5,529 | ) | $ | 2,431 | ||||||||
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | |
Intangible assets acquired from the Globe Motors acquisition were $33,530 (Note 2). | ||||||||||||||||||||||
Total amortization expense for intangible assets for the years 2013 and 2012 was $825 and $548 respectively. Estimated amortization expense for intangible assets is as follows: | ||||||||||||||||||||||
Year ending December 31, | Total | |||||||||||||||||||||
2014 | $ | 2,685 | ||||||||||||||||||||
2015 | 2,671 | |||||||||||||||||||||
2016 | 2,671 | |||||||||||||||||||||
2017 | 2,671 | |||||||||||||||||||||
2018 | 2,671 | |||||||||||||||||||||
Thereafter | 21,853 | |||||||||||||||||||||
| | | | | ||||||||||||||||||
$ | 35,222 | |||||||||||||||||||||
| | | | | ||||||||||||||||||
| | | | | ||||||||||||||||||
DEBT_OBLIGATIONS
DEBT OBLIGATIONS | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
DEBT OBLIGATIONS | ' | |||||||
DEBT OBLIGATIONS | ' | |||||||
5. DEBT OBLIGATIONS | ||||||||
Debt obligations consisted of the following (in thousands): | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Current Borrowings | ||||||||
Revolving Credit Facility (2.7% at December 31, 2013) | $ | 7,725 | $ | — | ||||
China Credit Facility (6.2% at December 31, 2013) | 1,170 | 397 | ||||||
Term Loan, current portion, (2.7% at December 31, 2013)(1) | 5,250 | — | ||||||
| | | | | | | | |
Current borrowings | $ | 14,145 | $ | 397 | ||||
| | | | | | | | |
| | | | | | | | |
Long-term Debt | ||||||||
Term Loan, noncurrent (2.7% at December 31, 2013)(1) | $ | 43,500 | $ | — | ||||
Subordinated Notes (14.5%, 13% Cash, 1.5% PIK) | 30,000 | — | ||||||
| | | | | | | | |
Long-term debt | $ | 73,500 | $ | — | ||||
| | | | | | | | |
| | | | | | | | |
-1 | ||||||||
The effective rate of the Term Loan including the impact of the related hedges is 3.14%. | ||||||||
Credit Agreement | ||||||||
In connection with the funding of the acquisition of Globe, the Company entered into a new Credit Agreement dated as of October 18, 2013. The Credit Agreement provides for a $15,000 five-year revolving credit facility and a $50,000 five-year term loan (collectively the "Senior Credit Facilities"). | ||||||||
Borrowings under the Senior Credit Facilities are subject to terms defined in the Credit Agreement. Borrowings bear interest at either the Base Rate plus a margin of 0.25% to 2.00% (currently 1.50%) or the Eurocurrency Rate plus a margin of 1.25% to 3.00%, in each case depending on the Company's ratio of total funded indebtedness to Consolidated EBITDA (the "Total Leverage Ratio"). | ||||||||
Principal installments are payable on the Term Loan in varying percentages quarterly through September 30, 2018 with a balloon payment at maturity. The Senior Credit Facilities are secured by substantially all of the Company's assets. The average outstanding borrowings for 2013 for the Senior Credit Facilities were $13,200. At December 31, 2013, there was approximately $7,300 available under the Senior Credit Facilities. | ||||||||
The Credit Agreement contains certain financial covenants related to maximum leverage and minimum fixed charge coverage. The Credit Agreement also includes other covenants and restrictions, including limits on the amount of certain types of capital expenditures. The Company was in compliance with all covenants at December 31, 2013. | ||||||||
The Senior Credit Facilities replaced the Company's Prior Credit Agreement dated as of May 7, 2007, as amended, among the Company, JPMorgan Chase Bank, N.A., as administrative agent and the lenders party thereto. The Prior Credit Agreement was scheduled to mature on October 26, 2014 and provided revolving credit up to $4,000 and €3,000. No amounts were outstanding under the Prior Credit Agreement at the time of termination. | ||||||||
Senior Subordinated Notes | ||||||||
Also in connection with funding the acquisition of Globe Motors, Inc., the Company entered into a Note Agreement, dated as of October 18, 2013 pursuant to which the Company sold $30,000 of 14.50% Senior Subordinated Notes due October 18, 2019 (the "Notes") to Prudential Capital Partners IV, L.P. and its affiliates in a private placement. The interest rate on the Notes is 14.50% with 13.00% payable in cash and 1.50% payable in-kind, quarterly in arrears and the outstanding principal amount of the Notes, together with any accrued and unpaid interest is due on October 18, 2019. The Company may prepay the Notes at any time after October 18, 2016, in whole or in part, at 100% of the principal amount. The Notes are unsecured obligations of the Company and are fully and unconditionally guaranteed by certain of the Company's subsidiaries. | ||||||||
Other | ||||||||
The Company also has a Credit Facility in China providing credit of approximately $1,600 (Chinese Renminbi ("RMB") 9,500). This facility is used for working capital and capital equipment needs at the Company's China operations, and will mature in October 2014. The average borrowings for 2013 were $766 (RMB 4,700). At December 31, 2013, there was approximately $386 (RMB 2,400) available under the facility. | ||||||||
Maturities of long-term debt are as follows: | ||||||||
Year ending December 31, | Total | |||||||
2014 | $ | 14,145 | ||||||
2015 | 6,375 | |||||||
2016 | 8,219 | |||||||
2017 | 10,374 | |||||||
2018 | 18,532 | |||||||
Thereafter | 30,000 | |||||||
| | | | | ||||
Total | $ | 87,645 | ||||||
| | | | | ||||
| | | | | ||||
Deferred Financing Fees | ||||||||
In connection with the new Credit Agreement, the Company incurred $2,377 of deferred financing costs. The Company capitalized these costs pursuant to the guidance in ASC Topic 835, "Broad Transactions—Interest." These costs are included in other assets in the accompanying consolidated balance sheets. The costs are deferred and amortized over the terms of the components of the Credit Agreement ranging up to six years. Amortization of these costs is charged to interest expense in the accompanying consolidated statements of income and comprehensive income using the straight-line method. The straight-line method is allowable under the guidance if the result is not materially different from the result using the effective interest method. | ||||||||
Deferred Financing costs net of accumulated amortization were $2,284 as of December 31, 2013. | ||||||||
DERIVATIVE_FINANCIAL_INSTRUMEN
DERIVATIVE FINANCIAL INSTRUMENTS | 12 Months Ended | ||||||||||||||
Dec. 31, 2013 | |||||||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ||||||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ||||||||||||||
6. DERIVATIVE FINANCIAL INSTRUMENTS | |||||||||||||||
The Company did not use derivative contracts prior to the acquisition of Globe Motors, Inc. in October, 2013. As part of the acquisition, the Company entered into a new Credit Agreement discussed in Note 5. Debt Obligations. The Credit Agreement requires the Company to enter into derivative contracts for at least 50% of the balance of the Term Loan, as amortized. During October 2013, the Company entered into two Interest Rate Swaps with a combined notional amount of $25,000 that amortize quarterly to a notional amount of $6,673 at maturity. | |||||||||||||||
The Company's use of Interest Rate Swaps assists in stabilizing interest expense and managing exposure to interest rate movements. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. | |||||||||||||||
The effective portion of changes in the fair value of the Interest Rate Swaps is recorded in Accumulated Other Comprehensive Income ("AOCI") and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. During 2013, the swaps were used to hedge the variable cash flows associated with existing variable-rate debt. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. During the twelve months ended December 31, 2013, the Company recorded $0 hedge ineffectiveness in earnings. | |||||||||||||||
Amounts reported in AOCI related to derivatives is reclassified to interest expense as interest payments are made on the Company's variable-rate debt. During 2014, the Company estimates that an additional $212 will be reclassified as an increase to interest expense. | |||||||||||||||
The table below presents the fair value of the Company's derivative financial instruments as well as their classification on the consolidated balance sheets as of December 31, 2013 (in thousands): | |||||||||||||||
Derivative Instrument | Balance Sheet Location | December 31, 2013 | |||||||||||||
Fair Value | |||||||||||||||
Interest Rate Swaps | Prepaid expenses and other assets | $ | 41 | ||||||||||||
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The effect of the Company's derivative financial instruments on the consolidated statement of income and comprehensive income is as follows (in thousands): | |||||||||||||||
For the year ended December 31, 2013 | For the year ended December 31, 2013 | For the year ended December 31, 2013 | |||||||||||||
Derivative | Net deferral | Statement of | Net | Statement of | Amount recognized | ||||||||||
Instruments | in OCI of | earnings | reclassification | earnings | in income (ineffective | ||||||||||
derivatives | classification | from AOCI into | classification | portion and amount | |||||||||||
(effective | income (effective | excluded from | |||||||||||||
portion) | portion) | effectiveness testing) | |||||||||||||
Interest Rate Swaps | $ | — | Interest expense | $ | (41 | ) | Other (expense) | $ | — | ||||||
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
As of December 31, 2013, the fair value of derivatives in a net asset position, which includes accrued interest but excludes any adjustment for nonperformance risk, related to these agreements was $44. As of December 31, 2013, the Company has not posted any collateral related to these agreements. | |||||||||||||||
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
INCOME TAXES | ' | |||||||
INCOME TAXES | ' | |||||||
7. INCOME TAXES | ||||||||
The provision for income taxes is based on income before income taxes as follows (in thousands): | ||||||||
For the year ended | For the year ended | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Domestic | $ | 1,406 | $ | 3,725 | ||||
Foreign | 4,375 | 3,773 | ||||||
| | | | | | | | |
Income before income taxes | $ | 5,781 | $ | 7,498 | ||||
| | | | | | | | |
| | | | | | | | |
Components of the total provision for income taxes are as follows (in thousands): | ||||||||
For the year ended | For the year ended | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Current provision | ||||||||
Domestic | $ | 1,179 | $ | 115 | ||||
Foreign | 898 | 881 | ||||||
| | | | | | | | |
Total current provision | 2,077 | 996 | ||||||
| | | | | | | | |
Deferred provision | ||||||||
Domestic | (197 | ) | 1,162 | |||||
Foreign | (52 | ) | (57 | ) | ||||
| | | | | | | | |
Total deferred provision | (249 | ) | 1,105 | |||||
| | | | | | | | |
Provision for income taxes | $ | 1,828 | $ | 2,101 | ||||
| | | | | | | | |
| | | | | | | | |
The provision for income taxes differs from the amount determined by applying the federal statutory rate as follows (in thousands): | ||||||||
For the year ended | For the year ended | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Tax provision, computed at statutory rate | 34 | % | 34 | % | ||||
State tax, net of federal impact | 3.7 | % | 3.3 | % | ||||
Effect of foreign tax rate differences and foreign tax adjustments | (9.7 | )% | (6.0 | )% | ||||
Dividend from foreign subsidiary, net of foreign tax credit | 3.5 | % | 0 | % | ||||
Adjustments to prior year accruals(1) | 0 | % | (1.9 | )% | ||||
Other | 0.1 | % | (1.4 | )% | ||||
| | | | | | | | |
Provision for income taxes | 31.6 | % | 28 | % | ||||
| | | | | | | | |
| | | | | | | | |
-1 | ||||||||
Adjustments relate to the resolution of certain prior year income tax related matters. | ||||||||
The tax effects of significant temporary differences and credit and operating loss carryforwards that give rise to the net deferred tax assets and tax liabilities are as follows (in thousands): | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Current deferred tax assets: | ||||||||
Allowances and other | $ | 1,315 | $ | 591 | ||||
Net operating loss and tax credit carryforwards | 3,628 | 98 | ||||||
| | | | | | | | |
Total current deferred tax assets | 4,943 | 689 | ||||||
Valuation allowance | (1,982 | ) | (50 | ) | ||||
| | | | | | | | |
Net current deferred tax assets | $ | 2,961 | $ | 639 | ||||
| | | | | | | | |
| | | | | | | | |
Noncurrent deferred tax assets: | ||||||||
Employee benefit plans | $ | 2,074 | $ | 1,375 | ||||
Goodwill and Intangibles | 1,553 | 2,916 | ||||||
Property, plant & equipment | (381 | ) | (188 | ) | ||||
| | | | | | | | |
Total noncurrent deferred tax assets | $ | 3,246 | $ | 4,103 | ||||
| | | | | | | | |
| | | | | | | | |
Deferred tax liabilities: | ||||||||
Acquired property, plant and equipment and intangible assets | $ | 1,997 | $ | 638 | ||||
Other | 330 | 297 | ||||||
| | | | | | | | |
Total deferred tax liabilities | $ | 2,327 | $ | 935 | ||||
| | | | | | | | |
| | | | | | | | |
The Company has foreign net operating loss carryforwards of approximately $3,300 expiring in 2014 through 2017 and tax credit carryforwards of approximately $212 expiring in 2018. These carryforwards and related valuation allowance were recorded in relation to the acquisition of Globe Motors, Inc. and are included in the purchase price allocation discussed in Note 2. Acquisitions. | ||||||||
Additionally, the Company has foreign operating losses and tax credit carryforwards that relate to a foreign subsidiary acquired in 2010. At the time of the acquisition, the Company could not conclude, on a more likely than not basis, that it would ultimately realize tax benefits from these losses and credits, and therefore valued the deferred benefit at zero. The Company will continue to assess its ability to utilize any portion of the tax carryforward balance and whether it should adjust the amount of deferred tax asset related to this carryforward. | ||||||||
Realization of the Company's recorded deferred tax assets is dependent upon the Company generating sufficient taxable income in the appropriate tax jurisdictions in future years to obtain benefit from the reversal of net deductible temporary differences and from utilization of net operating losses and tax credit carryforwards. The Company has recorded a valuation allowance due to the uncertainty related to the realization of certain deferred tax assets existing at December 31, 2013. The amount of deferred tax assets considered realizable is subject to adjustment in future periods if estimates of future taxable income are changed. Management believes that it is more likely than not that the Company will realize the benefits of its deferred tax assets, net of valuation allowances as of December 31, 2013. | ||||||||
The Company files income tax returns in various U.S. and foreign taxing jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal and state tax examinations in its major tax jurisdictions for periods before 2009. The Company is no longer subject to tax examinations in The Netherlands or Sweden for periods before 2008. The Company is no longer subject to tax examinations in Portugal for periods before 2010. | ||||||||
In relation to the acquisition of Globe Motors, Inc., the Company intends to file a unilateral election under Section 338(g) of the Internal Revenue Code to treat the acquisition as an asset purchase instead of a stock purchase. This election will allow the Company to take a stepped-up basis at the fair market value purchase price and the transaction will be deemed, for purposes of the section, as an asset sale. The deemed sale may result in a taxable gain for the Company. The effects of the election have been assumed for purposes of the purchase price allocation discussed in Note 2. The final date by which the Company must make the election is July 15, 2014. Should the company not make the election as intended; the purchase price allocation will be adjusted accordingly. | ||||||||
In general, it is the practice and intention of the Company to reinvest the earnings of its non-domestic subsidiaries in activities outside the United States. Generally, such amounts would become subject to domestic taxation upon the remittance of dividends to the United States and under certain other circumstances. Exceptions may be made on a year-by-year basis to repatriate current year earnings of certain foreign subsidiaries based on cash needs in the United States. During 2013, the Company's foreign subsidiaries paid dividends of $3,400 to the Company's domestic parent in relation to completing the acquisition of Globe Motors, Inc. and U.S. tax consequences of the payments have been included in the Company's provision for income taxes. The Company does not intend to transfer or pay dividends of the remaining amounts and, therefore, has not recorded the domestic tax consequences of such payments. As of December 31, 2013, domestic income and foreign withholding taxes have not been provided for unremitted earnings of foreign subsidiaries. These earnings, which are considered to be indefinitely reinvested, would become subject to domestic income tax if they were remitted to the United States. The amount of unrecognized deferred income tax liability on the unremitted earnings has not been determined because the hypothetical calculation is not practicable. | ||||||||
STOCKBASED_COMPENSATION_PLANS
STOCK-BASED COMPENSATION PLANS | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
STOCK-BASED COMPENSATION PLANS | ' | ||||
STOCK-BASED COMPENSATION PLANS | ' | ||||
8. STOCK-BASED COMPENSATION PLANS | |||||
Stock Incentive Plans | |||||
The Company's Stock Incentive Plans provide for the granting of stock awards, including stock options, stock appreciation rights and restricted stock, to employees and non-employees, including directors of the Company. | |||||
As of December 31, 2013, the Company had 852,493 shares of Common Stock available for grant under stock incentive plans. | |||||
Restricted Stock | |||||
During 2013 and 2012, 423,518 and 140,150 shares of unvested restricted stock were awarded with a weighted average value of $7.73 and $7.10 per share, respectively. Of the restricted shares granted in 2013 and 2012, 58,909 and 30,000 shares have performance based vesting requirements. The value at the date of award is amortized to compensation expense over the related service period, which is generally three years (for time vested grants), or over the performance period. Shares of non-vested restricted stock are forfeited if a recipient leaves the Company before the vesting date. Shares that are forfeited become available for future awards. | |||||
The following is a summary of restricted stock activity during years 2013 and 2012: | |||||
Number of Nonvested | |||||
Restricted Shares | |||||
Balance, December 31, 2011 | 283,608 | ||||
Awarded | 140,150 | ||||
Forfeited | (21,398 | ) | |||
Vested | (159,236 | ) | |||
| | | | | |
Balance, December 31, 2012 | 243,124 | ||||
Awarded | 423,518 | ||||
Forfeited | (3,181 | ) | |||
Vested | (143,266 | ) | |||
| | | | | |
Balance, December 31, 2013 | 520,195 | ||||
| | | | | |
| | | | | |
In 2013, of the 58,909 performance shares granted in 2013, 18,775 achieved the related performance criteria, and are still outstanding, 5,190 did not achieve the performance criteria and are still outstanding, and 34,944 were forfeited as the performance criteria was not achieved. In 2012, 20,000 of the 30,000 performance based shares granted in 2012 were forfeited as the performance criteria was not achieved. 5,190 and 10,000 of the performance based shares granted in 2013 and 2012 respectively are still outstanding as of December 31, 2013. The vesting and forfeitures discussed above did not occur until the Board of Directors approved them during the February 2014 meeting. | |||||
Share-Based Compensation Expense | |||||
Restricted Stock | |||||
During 2013 and 2012, compensation expense net of forfeitures of $927 and $609 was recorded, respectively. As of December 31, 2013, there was $3,264 of total unrecognized compensation expense related to restricted stock awards, of which approximately $950 is expected to be recognized in 2014. | |||||
Employee Stock Ownership Plan | |||||
The Company sponsors an Employee Stock Ownership Plan ("ESOP") that covers all non-union U.S. employees who work over 1,000 hours per year. The terms of the ESOP require the Company to make an annual contribution equal to the greater of i) the Board established percentage of pretax income before the contribution (5% in 2013 and 2012) or ii) the annual interest payable on any loan outstanding to the Company. Company contributions to the Plan accrued for 2013 and 2012, respectively, were $304 and $395. These amounts are included in General and Administrative costs in the consolidated statements of income and comprehensive income. | |||||
Defined Contribution Plan | |||||
The Company sponsors the Allied Motion 401(k) Tax Advantaged Investment Plan ("401(k)") which covers substantially all of its U.S. based employees. The plan provides for the deferral of employee compensation under Section 401(k) and a discretionary Company match. In 2013 and 2012, this match was 100% per dollar of the first 3% of participant deferral and 50% per dollar of the next 2% contribution, up to 4% of a total 5% participant deferral. Net costs related to this defined contribution plan were $506 in 2013 and $400 in 2012. | |||||
Dividends | |||||
For the year ended December 31, 2013 and 2012, a total of $0.10 and $0.10 per share, respectively, on all outstanding shares was paid. Based on the terms of the Company's Credit Agreement, dividends paid to shareholders are acceptable, subject to the Company's compliance with the covenants under the Credit Agreement. | |||||
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
9. COMMITMENTS AND CONTINGENCIES | |||||
Operating Leases | |||||
At December 31, 2013, the Company maintains leases for certain facilities and equipment. The Company has entered into facility agreements, some of which contain provisions for future rent increases. The total amount of rental payments due over the lease term is being charged to rent expense on the straight-line method over the term of the lease. The difference between rent expense recorded and the amount paid is credited or charged to "Deferred rent obligation," which is included in "Accrued liabilities" in the accompanying consolidated balance sheets. | |||||
Minimum future rental commitments under all non-cancelable operating leases are as follows (in thousands): | |||||
Year ending December 31, | Total | ||||
2014 | $ | 1,727 | |||
2015 | 1,349 | ||||
2016 | 1,304 | ||||
2017 | 993 | ||||
2018 | 715 | ||||
Thereafter | 3,027 | ||||
| | | | | |
$ | 9,115 | ||||
| | | | | |
| | | | | |
Rental expense was $1,248 and $1,144 in 2013 and 2012, respectively. | |||||
Severance Benefit Agreements | |||||
The Company has entered into annually renewable severance benefit agreements with key employees which, among other things, provide inducement to the employees to continue to work for the Company during and after any period of a potential change in control of the Company. The agreements provide the employees with specified benefits upon the subsequent severance of employment in the event of change in control of the Company and are effective for 24 months thereafter. The amount of severance payments that could be required to be paid under these contracts, if such events occur, totaled approximately $5,396 and $5,028, respectively as of December 31, 2013 and 2012. In addition, severance benefits include, for some employees, a gross-up payment for excise taxes, if any. | |||||
Litigation | |||||
The Company is involved in certain actions that have arisen out of the ordinary course of business. Management believes that resolution of the actions will not have a significant adverse effect on the Company's consolidated financial position or results of operations. | |||||
DEFERRED_COMPENSATION_ARRANGEM
DEFERRED COMPENSATION ARRANGEMENTS | 12 Months Ended |
Dec. 31, 2013 | |
DEFERRED COMPENSATION ARRANGEMENTS | ' |
DEFERRED COMPENSATION ARRANGEMENTS | ' |
10. DEFERRED COMPENSATION ARRANGEMENTS | |
The Company has deferred compensation arrangements with certain key members of management. These arrangements provide the Board with the ability to make contributions based on the Company's performance and discretionary contributions based on other factors as determined by the Board. It also allows for the participants to make certain deferrals into the plan. The amount of the liability is composed of liabilities from previous contributions as well as the performance contribution for the year ended December 31, 2013. Amounts accrued relating to previous contributions to the plan are $2,599 and $1,997 as of December 31, 2013 and December 31, 2012, respectively, and are included in noncurrent liabilities in the consolidated balance sheets. The amounts accrued as of December 31, 2013 and December 31, 2012, respectively, which relate to the performance contribution for 2013 and 2012 are $0, and $308, respectively, and are included in accrued liabilities on the consolidated balance sheets. | |
In addition, the Company would contribute certain amounts to a Supplemental Executive Retirement Plan in the event of death, disability, or termination without cause, for certain key executives. As of December 31, 2013 this amount would be approximately $615. | |
PENSION_AND_POSTRETIREMENT_WEL
PENSION AND POSTRETIREMENT WELFARE PLANS | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
PENSION AND POSTRETIREMENT WELFARE PLANS | ' | |||||||
PENSION AND POSTRETIREMENT WELFARE PLANS | ' | |||||||
11. PENSION AND POSTRETIREMENT WELFARE PLANS | ||||||||
Pension Plan | ||||||||
Motor Products (Allied Motion Owosso) has a defined benefit pension plan covering substantially all of its hourly union employees hired prior to April 10, 2002. The benefits are based on years of service, the employee's compensation during the last three years of employment, and accumulated employee contributions. | ||||||||
The following tables provide a reconciliation of the change in benefit obligation, the change in plan assets and the net amount recognized in the consolidated balance sheets at December 31, 2013 and December 31, 2012 (in thousands): | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Change in projected benefit obligation: | ||||||||
Projected benefit obligation at beginning of period | $ | 6,277 | $ | 5,556 | ||||
Service cost | 103 | 122 | ||||||
Employee contributions | 10 | 9 | ||||||
Interest cost | 241 | 259 | ||||||
Actuarial (gain) loss | (638 | ) | 580 | |||||
Benefits paid | (255 | ) | (249 | ) | ||||
| | | | | | | | |
Projected benefit obligation at end of period | $ | 5,738 | $ | 6,277 | ||||
| | | | | | | | |
| | | | | | | | |
Change in plan assets: | ||||||||
Fair value of plan assets at beginning of period | $ | 4,086 | $ | 3,418 | ||||
Actual return on plan assets | 691 | 469 | ||||||
Employee contributions | 10 | 9 | ||||||
Employer contributions | 315 | 439 | ||||||
Benefits and expenses paid | (255 | ) | (249 | ) | ||||
| | | | | | | | |
Fair value of plan assets at end of period | $ | 4,847 | $ | 4,086 | ||||
| | | | | | | | |
| | | | | | | | |
The following table reconciles the accumulated other comprehensive income from the prior measurement date to the current measurement date: | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Excess of projected benefit obligation over fair value of plan assets | $ | 891 | $ | 2,191 | ||||
Unrecognized loss | (875 | ) | (2,088 | ) | ||||
| | | | | | | | |
Accrued pension cost prior to pension adjustments | $ | 16 | $ | 103 | ||||
Accumulated Other Comprehensive Income at Current Measurement Date | 875 | 2,088 | ||||||
| | | | | | | | |
Accrued pension cost at end of period | $ | 891 | $ | 2,191 | ||||
| | | | | | | | |
| | | | | | | | |
The accumulated benefit obligation for the pension plan was $5,548 at December 31, 2013 and $6,032 at December 31, 2012. The amount of accumulated other comprehensive income expected to be recognized as a plan expense in 2014 is $43, which all relates to the amortization of the actuarial loss. | ||||||||
Benefits expected to be paid from the Plan during each of the next five fiscal years, and in aggregate for the five fiscal years thereafter are (in thousands): | ||||||||
Year of payment | Amount of | |||||||
Benefit | ||||||||
Payment | ||||||||
2014 | $ | 289 | ||||||
2015 | 308 | |||||||
2016 | 311 | |||||||
2017 | 326 | |||||||
2018 | 326 | |||||||
2019 - 2023 | 1,863 | |||||||
Components of net periodic pension expense included in the consolidated statements of income and comprehensive income for years 2013 and 2012 are as follows (in thousands): | ||||||||
For the | For the | |||||||
year ended | year ended | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Service cost | $ | 103 | $ | 122 | ||||
Interest cost | 241 | 259 | ||||||
Amortization of net loss | 172 | 150 | ||||||
Expected return on assets | (288 | ) | (245 | ) | ||||
| | | | | | | | |
Net periodic pension expense | $ | 228 | $ | 286 | ||||
| | | | | | | | |
| | | | | | | | |
Items subject to deferred recognition are amortized on a straight-line basis over the average remaining service period of active employees expected to receive benefits from the plan. Cumulative gains and losses, including the impact of any actuarial assumption changes, are amortized to the extent that their value exceeds 10% of the greater of the Market Related Value of Assets and the Projected Benefit Obligation. | ||||||||
The weighted average assumptions used to determine the projected benefit obligation were as follows: | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Discount rate | 4.75 | % | 4 | % | ||||
Rate of compensation increases | 2 | % | 5 | % | ||||
The weighted average assumptions used to determine net periodic pension expense are as follows: | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Discount rate | 4 | % | 4.75 | % | ||||
Expected long-term rate of return on plan assets | 7 | % | 7 | % | ||||
Rate of compensation increases | 5 | % | 5 | % | ||||
The expected rate of return on plan assets assumption is based on the long-term expected returns for the investment mix of assets currently in the portfolio. Management uses historic return trends of the asset portfolio combined with anticipated future market conditions to estimate the rate of return. The performance of the financial markets and changes in interest rates impact the funding obligations under our pension plan. Significant changes in market interest rates and decreases in the fair value of plan assets may increase our funding obligations and adversely impact our results of operations and cash flows in future periods. | ||||||||
The Company expects to contribute approximately $285 to the pension plan during 2014. | ||||||||
All plan assets are accounted for at fair value on a recurring basis. Fair values are determined using level one input, or quoted prices for identical assets in active markets on the measurement date, as discussed in Note 1. | ||||||||
The pension plan assets allocation at December 31, 2013 and 2012 was as follows: | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Cash equivalents | 5 | % | 4 | % | ||||
Equity securities | 64 | % | 65 | % | ||||
Fixed income securities | 31 | % | 31 | % | ||||
| | | | | | | | |
Total | 100 | % | 100 | % | ||||
| | | | | | | | |
| | | | | | | | |
The pension assets are managed by an outside investment manager. The Company's investment policy with respect to pension assets is to make investments solely in the interest of the participants and beneficiaries of the plans and for the exclusive purpose of providing benefits accrued and defraying the reasonable expenses of administration. The Company strives to maintain investment diversification to assist in minimizing the risk of large losses. | ||||||||
The pension assets are subject to the following ranges for asset allocation percentages based on the Plan's Investment Policy Guidelines: | ||||||||
Equity securities | 55 - 75% | |||||||
Fixed income securities | 25 - 45% | |||||||
Cash | 0 - 20% | |||||||
| | | ||||||
Total | 100% | |||||||
| | | ||||||
| | | ||||||
Postretirement Welfare Plan | ||||||||
Motor Products provides postretirement medical insurance and life insurance benefits to current and former employees hired before January 1, 1994 who retire from Motor Products. Employees who retire after January 1, 2005 must have twenty or more years of continuous service in order to be eligible for retiree medical benefits. Partial contributions from retirees are required for the medical insurance benefits. The Company's portion of the medical insurance premiums is funded from the general assets of the Company. The Company recognizes the expected cost of providing such post-retirement benefits during employees' active service periods. | ||||||||
The following tables provide a reconciliation of the change in the accumulated postretirement benefit obligation and the net amount recognized in the consolidated balance sheets at December 31, 2013 and December 31, 2012 (in thousands): | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Change in postretirement benefit obligation: | ||||||||
Accumulated post retirement benefit obligation at beginning of period | $ | 1,621 | $ | 1,378 | ||||
Service cost | 16 | 22 | ||||||
Interest cost | 60 | 67 | ||||||
Actuarial (gain) loss | (243 | ) | 227 | |||||
Benefits paid | (47 | ) | (73 | ) | ||||
| | | | | | | | |
Accumulated postretirement benefit obligation at end of period | $ | 1,407 | $ | 1,621 | ||||
| | | | | | | | |
| | | | | | | | |
Net periodic postretirement benefit costs included in the consolidated statements of income and comprehensive income for years 2013 and 2012 were $30 and $28, respectively. | ||||||||
The amount of accumulated other comprehensive income expected to be recognized as income to the plan in 2014 is $66, of which $54 relates to the actuarial gain and $12 to the prior service credit. | ||||||||
Postretirement medical liabilities can be extremely sensitive to changes in the assumed rate of future medical increases, and, therefore the healthcare cost trend rate assumption can have a significant effect on the amounts reported. However, the Company's current contractual obligation requires a per capita fixed Company contribution amount through December 2015. | ||||||||
The weighted average discount rate used in determining the accumulated postretirement benefit obligation was 4.75% and 4.00% as of December 31, 2013 and 2012, respectively. The weighted average discount rate used to determine the net periodic postretirement benefit cost was 4.00% for 2013 and 4.75% for 2012. | ||||||||
Benefits expected to be paid from the Plan during each of the next five fiscal years, and in aggregate for the five fiscal years thereafter are (in thousands): | ||||||||
Year of payment | Amount of | |||||||
Benefit Payment | ||||||||
2014 | $ | 58 | ||||||
2015 | 62 | |||||||
2016 | 60 | |||||||
2017 | 68 | |||||||
2018 | 64 | |||||||
2019 - 2023 | 404 |
SEGMENT_INFORMATION
SEGMENT INFORMATION | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
SEGMENT INFORMATION | ' | |||||||
SEGMENT INFORMATION | ' | |||||||
12. SEGMENT INFORMATION | ||||||||
ASC Topic "Segment Reporting" requires disclosure of operating segments, which as defined, are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. | ||||||||
The Company operates in one segment for the manufacture and marketing of motion control products for original equipment manufacturers and end user applications. In accordance with the "Segment Reporting" Topic of the ASC, the Company's chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under "Segment Reporting" due to their similar customer base and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by "Segment Reporting" can be found in the accompanying consolidated financial statements and within this note. | ||||||||
The Company's wholly owned foreign subsidiaries, Premotec (Dordrecht, The Netherlands), Allied Motion Stockholm (formerly known as Östergrens, located in Stockholm, Sweden), Allied Motion Asia (Hong Kong and Changzhou, China), Allied Motion Canada (Oakville, Ontario, Canada), Globe Motors Portugal (Porto, Portugal) and Globe Motors Mexico (Reynosa, Mexico) are included in the accompanying consolidated financial statements. | ||||||||
Financial information related to the foreign subsidiaries is summarized below (in thousands): | ||||||||
For the year ended | ||||||||
and as of | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Revenues derived from foreign subsidiaries | $ | 51,199 | $ | 42,172 | ||||
Identifiable assets | 55,627 | 26,525 | ||||||
Sales to customers outside of the United States by all Technology Units ("TUs") were $53,988 and $44,761 in years 2013 and 2012, respectively. | ||||||||
During years 2013 and 2012, no single customer accounted for more than 10% of total revenues. | ||||||||
RECLASSIFICATIONS
RECLASSIFICATIONS | 12 Months Ended |
Dec. 31, 2013 | |
RECLASSIFICATIONS | ' |
RECLASSIFICATIONS | ' |
13. RECLASSIFICATIONS | |
Certain prior year balances were reclassified to conform to the current year presentation. Those reclassifications had no impact on the consolidated statements of income and comprehensive income, the consolidated statements of stockholders' equity or the consolidated statements of cash flows as previously reported. | |
SELECTED_QUARTERLY_FINANCIAL_D
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) | ' | |||||||||||||
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) | ' | |||||||||||||
14. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) | ||||||||||||||
Selected quarterly financial data for each of the four quarters in years 2013 and 2012 is as follows (in thousands, except per share data): | ||||||||||||||
Year 2013 | First | Second | Third | Fourth | ||||||||||
Quarter | Quarter | Quarter | Quarter | |||||||||||
Revenues | $ | 25,143 | $ | 25,352 | $ | 24,876 | $ | 50,131 | ||||||
Gross margin | 7,523 | 7,535 | 7,238 | 14,226 | ||||||||||
Net income | 960 | 819 | 833 | 1,341 | ||||||||||
Basic income per share | 0.11 | 0.09 | 0.09 | 0.15 | ||||||||||
Diluted income per share | 0.11 | 0.09 | 0.09 | 0.15 | ||||||||||
Year 2012 | First | Second | Third | Fourth | ||||||||||
Quarter | Quarter | Quarter | Quarter | |||||||||||
Revenues | $ | 26,847 | $ | 26,836 | $ | 24,316 | $ | 23,969 | ||||||
Gross margin | 7,637 | 8,151 | 7,099 | 6,753 | ||||||||||
Net income | 1,158 | 1,817 | 1,321 | 1,101 | ||||||||||
Basic income per share | 0.14 | 0.21 | 0.15 | 0.13 | ||||||||||
Diluted income per share | 0.14 | 0.21 | 0.15 | 0.13 |
BUSINESS_AND_SUMMARY_OF_SIGNIF1
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||
Principles of Consolidation | ' | ||||||||||
Principles of Consolidation | |||||||||||
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant inter-company accounts and transactions are eliminated in consolidation. | |||||||||||
Acquisitions are accounted for under the acquisition method and, accordingly, the operating results for Globe Motors, Inc. (Note 2.) are included in the consolidated statements of income and comprehensive income from October 18, 2013, the date of acquisition. | |||||||||||
Cash and Cash Equivalents | ' | ||||||||||
Cash and Cash Equivalents | |||||||||||
Cash and cash equivalents include instruments which are readily convertible into cash (original maturities of three months or less) and which are not subject to significant risk of changes in interest rates. Cash flows from foreign currency transactions are translated using an average rate. | |||||||||||
Accounts Receivable | ' | ||||||||||
Accounts Receivable | |||||||||||
Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses in the Company's existing accounts receivable; however, changes in circumstances relating to accounts receivable may result in a requirement for additional allowances in the future. | |||||||||||
Activity in the allowance for doubtful accounts for 2013 and 2012 was as follows (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Beginning balance | $ | 177 | $ | 284 | |||||||
Allowance for doubtful accounts acquired | 460 | — | |||||||||
Additional reserves | 164 | (25 | ) | ||||||||
Writeoffs | 1 | (82 | ) | ||||||||
| | | | | | | | ||||
Ending balance | $ | 802 | $ | 177 | |||||||
| | | | | | | | ||||
| | | | | | | | ||||
Inventories | ' | ||||||||||
Inventories | |||||||||||
Inventories include costs of materials, direct labor and manufacturing overhead, and are stated at the lower of cost (first-in, first-out basis) or market, as follows (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Parts and raw materials | $ | 20,649 | $ | 13,174 | |||||||
Work-in-process | 3,369 | 1,504 | |||||||||
Finished goods | 4,350 | 2,096 | |||||||||
| | | | | | | | ||||
28,368 | 16,774 | ||||||||||
Less reserves | (3,938 | ) | (2,073 | ) | |||||||
| | | | | | | | ||||
Inventories, net | $ | 24,430 | $ | 14,701 | |||||||
| | | | | | | | ||||
| | | | | | | | ||||
The Company recorded provisions for excess and obsolete inventories of approximately $105 and $265, for 2013 and 2012, respectively. | |||||||||||
Property, Plant and Equipment | ' | ||||||||||
Property, Plant and Equipment | |||||||||||
Property, plant and equipment is classified as follows (in thousands): | |||||||||||
Useful lives | December 31, | December 31, | |||||||||
2013 | 2012 | ||||||||||
Land | $ | 3,020 | $ | 290 | |||||||
Building and improvements | 5 - 39 years | 7,382 | 3,713 | ||||||||
Machinery, equipment, tools and dies | 3 - 15 years | 40,237 | 13,483 | ||||||||
Furniture, fixtures and other | 3 - 10 years | 4,544 | 3,996 | ||||||||
| | | | | | | | | | ||
55,183 | 21,482 | ||||||||||
Less accumulated depreciation | (15,072 | ) | (12,851 | ) | |||||||
| | | | | | | | | | ||
Property, plant and equipment, net | $ | 40,111 | $ | 8,631 | |||||||
| | | | | | | | | | ||
| | | | | | | | | | ||
Depreciation expense is provided using the straight-line method over the estimated useful lives of the assets. Amortization of building improvements is provided using the straight-line method over the life of the lease term or the life of the assets, whichever is shorter. Maintenance and repair costs are charged to operations as incurred. Major additions and improvements are capitalized. The cost and related accumulated depreciation of retired or sold property are removed from the accounts and the resulting gain or loss, if any, is reflected in earnings. | |||||||||||
Depreciation expense was approximately $2,088 and $1,250 in 2013 and 2012, respectively. | |||||||||||
Computer software and software development costs incurred in connection with developing or obtaining computer software for internal use that has an extended useful life are capitalized. These costs are amortized over their estimated useful life of seven years. During 2013 and 2012, software costs of $488 and $1,072, respectively, were capitalized. ERP software and implementation related costs are included within furniture, fixtures and other in the property, plant and equipment table. | |||||||||||
Intangible Assets | ' | ||||||||||
Intangible Assets | |||||||||||
Intangible assets, other than goodwill, are recorded at cost and are amortized over their estimated useful lives using the straight-line method. | |||||||||||
Impairment of Long-Lived Assets | ' | ||||||||||
Impairment of Long-Lived Assets | |||||||||||
The Company reviews the carrying values of its long-lived assets, including property, plant and equipment and intangible assets, whenever events or changes in circumstances indicate that such carrying values may not be recoverable. Long-lived assets are carried at historical cost if the projected cash flows from their use will recover their carrying amounts on an undiscounted basis and without considering interest. If projected cash flows are less than their carrying value, the long-lived assets must be reduced to their estimated fair value. Considerable judgment is required to project such cash flows and, if required, estimate the fair value of the impaired long-lived asset. | |||||||||||
Goodwill | ' | ||||||||||
Goodwill | |||||||||||
Goodwill represents the excess of the purchase price over the fair value of identifiable net tangible and intangible assets acquired in a business combination. | |||||||||||
Goodwill is tested annually for impairment or more frequently if events or changes in circumstances indicate that impairment may have occurred. We have the option to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. Otherwise, the impairment analysis for goodwill includes a comparison of our carrying value (including goodwill) to our estimated fair value. If the fair value does not exceed the carrying value, then an additional analysis would be performed to allocate the fair value to all of our assets and liabilities as if it had been acquired in a business combination and the fair value was our purchase price. If the excess of the fair value of our identifiable assets and liabilities is less than the carrying value of recorded goodwill, an impairment charge is recorded for the difference. | |||||||||||
The Company did not record any such impairment for the twelve months ended December 31, 2013 and 2012. | |||||||||||
Other Long-term Assets | ' | ||||||||||
Other Long-term Assets | |||||||||||
Other long-term assets are securities that the Company has purchased with the intent of funding the deferred compensation arrangements for certain executives of the Company. These securities are accounted for at fair value on a recurring basis. Any changes to the value of these securities held by the Company are included in Net Income in the Company's consolidated statements of income and comprehensive income. | |||||||||||
Warranty | ' | ||||||||||
Warranty | |||||||||||
The Company offers warranty coverage for its products. The length of the warranty period for its products varies significantly based on the product being sold. The Company estimates the costs of repairing products under warranty based on the historical average cost of the repairs. The assumptions used to estimate warranty accruals are reevaluated periodically in light of actual experience and, when appropriate, the accruals are adjusted. Estimated warranty costs are recorded at the time of sale of the related product, and are considered a cost of sale. | |||||||||||
Changes in the Company's reserve for product warranty claims during 2013 and 2012 were as follows (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Warranty reserve at beginning of the year | $ | 551 | $ | 372 | |||||||
Warranty reserves acquired | 429 | — | |||||||||
Provision | 175 | 579 | |||||||||
Warranty expenditures | (529 | ) | (411 | ) | |||||||
Effect of foreign currency translation | 3 | 11 | |||||||||
| | | | | | | | ||||
Warranty reserve at end of year | $ | 629 | $ | 551 | |||||||
| | | | | | | | ||||
| | | | | | | | ||||
In 2012, of the $579 of warranty provision, $342 was recorded to cover the expected costs of replacing certain products in the field due to an incorrect electronic component in a printed circuit board supplied by one of the Company's sub-contract suppliers. In 2013, $44 of additional provision was recorded, and $367 of warranty expenditures were incurred related to this issue. The remaining reserve balance is $30, net of the effect of foreign currency translation. | |||||||||||
Accrued Liabilities | ' | ||||||||||
Accrued Liabilities | |||||||||||
Accrued liabilities consist of the following (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Compensation and fringe benefits | $ | 6,721 | $ | 4,230 | |||||||
Warranty reserve | 629 | 551 | |||||||||
Other accrued expenses | 2,548 | 1,145 | |||||||||
| | | | | | | | ||||
$ | 9,898 | $ | 5,926 | ||||||||
| | | | | | | | ||||
| | | | | | | | ||||
Foreign Currency Translation | ' | ||||||||||
Foreign Currency Translation | |||||||||||
The assets and liabilities of the Company's foreign subsidiaries are translated into U.S. dollars using end of period exchange rates. Changes in reported amounts of assets and liabilities of foreign subsidiaries that occur as a result of changes in exchange rates between foreign subsidiaries' functional currencies and the U.S. dollar are included in foreign currency translation adjustment. Foreign currency translation adjustment is included in other comprehensive income, a component of stockholders' equity in the accompanying consolidated statements of stockholders' equity. Revenue and expense transactions use an average rate prevailing during the month of the related transaction. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency of each Technology Unit ("TU") are included in the results of operations as incurred. | |||||||||||
Engineering and Development Costs | ' | ||||||||||
Engineering and Development Costs | |||||||||||
The Company is engaged in a variety of engineering and design activities as well as basic research and development activities directed to the substantial improvement or new application of the Company's existing technologies. Engineering and development costs are expensed as incurred. | |||||||||||
Revenue Recognition | ' | ||||||||||
Revenue Recognition | |||||||||||
The Company recognizes revenue when products are shipped or delivered (shipping terms may be either FOB shipping point or destination) and title has passed to the customer, persuasive evidence of an arrangement exists, the selling price is fixed or determinable, and collectability is reasonably assured. | |||||||||||
Basic and Diluted Income per Share from Continuing Operations | ' | ||||||||||
Basic and Diluted Income per Share from Continuing Operations | |||||||||||
Basic income per share is computed by dividing net income or loss by the weighted average number of shares of common stock outstanding. Diluted income per share is determined by dividing the net income by the sum of (1) the weighted average number of common shares outstanding and (2) if not anti-dilutive, the effect of stock awards determined utilizing the treasury stock method. The dilutive effect of outstanding awards was 7 and 0 shares for the years 2013 and 2012, respectively. No stock awards were excluded from the calculation of diluted income per share for years 2013 and 2012. | |||||||||||
Comprehensive Income | ' | ||||||||||
Comprehensive Income | |||||||||||
Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. It includes all changes in equity during a period except those resulting from investments by and distributions to stockholders. | |||||||||||
Fair Value Accounting | ' | ||||||||||
Fair Value Accounting | |||||||||||
Authoritative guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. | |||||||||||
The guidance establishes a framework for measuring fair value which utilizes observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company's market assumptions. Preference is given to observable inputs. These two types of inputs create the following three-level fair value hierarchy: | |||||||||||
Level 1: | Quoted prices for identical assets or liabilities in active markets. | ||||||||||
Level 2: | Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations whose inputs or significant value drivers are observable. | ||||||||||
Level 3: | Significant inputs to the valuation model that are unobservable. | ||||||||||
The Company's financial assets and liabilities include cash and cash equivalents, accounts receivable, debt obligations, accounts payable, and accrued liabilities. The carrying amounts reported in the consolidated balance sheets for these assets approximate fair value because of the immediate or short-term maturities of these financial instruments. | |||||||||||
The following table presents the Company's financial assets that are accounted for at fair value on a recurring basis as of December 31, 2013 and December 31, 2012, respectively, by level within the fair value hierarchy (in thousands): | |||||||||||
December 31, 2013 | |||||||||||
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Pension Plan Assets | $ | 4,847 | $ | — | $ | — | |||||
Other long term assets | 2,595 | — | — | ||||||||
Interest rate swaps | — | 41 | — | ||||||||
December 31, 2012 | |||||||||||
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Pension Plan Assets | $ | 4,086 | $ | — | $ | — | |||||
Other long term assets | 1,991 | — | — | ||||||||
Derivative Financial Instruments | ' | ||||||||||
Derivative Financial Instruments | |||||||||||
As required by ASC Topic 815, "Derivatives and Hedging," the Company records all derivatives on the balance sheets at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain of its risks, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. | |||||||||||
Income Taxes | ' | ||||||||||
Income Taxes | |||||||||||
The Company accounts for income taxes in accordance with ASC Topic 740, "Income Taxes." Consistent with guidance in "Income Taxes," the current provision for income taxes represents actual or estimated amounts payable or refundable on tax return filings each year. Deferred tax assets and liabilities are recorded for the estimated future tax effects of temporary differences between the tax basis of assets and liabilities and amounts reported in the accompanying consolidated balance sheets, and for operating loss and tax credit carryforwards. The change in deferred tax assets and liabilities for the period measures the deferred tax provision or benefit for the period. Effects of changes in enacted tax laws on deferred tax assets and liabilities are reflected as adjustments to the tax provision or benefit in the period of enactment. A valuation allowance may be provided to the extent management deems it is more likely than not that deferred tax assets will not be realized. The ultimate realization of net deferred tax assets is dependent upon the generation of future taxable income, in the appropriate taxing jurisdictions, during the periods in which temporary differences, net operating losses and tax credits become realizable. Management believes that it is more likely than not that the Company will realize the benefits of these temporary differences and operating loss and tax credit carryforwards, net of valuation allowances. | |||||||||||
The guidance in "Income Taxes" requires that realization of an uncertain income tax position must have a "more likely than not" probability of being sustained based on technical merits before it can be recognized in the financial statements, assuming a review by tax authorities having all relevant information and applying current conventions. The Company does not have significant unrecognized tax benefits and does not anticipate a significant increase or decrease in unrecognized tax benefits within the next twelve months. Income tax related interest and penalties recognized in 2013 and 2012 are immaterial. | |||||||||||
Pension and Postretirement Welfare Plans | ' | ||||||||||
Pension and Postretirement Welfare Plans | |||||||||||
The Company reports gains or losses and prior service costs or credits that arise during the period, but not recognized as components of net periodic benefit cost, as a component of other comprehensive income, net of tax, in accordance with ASC Topic 715, "Compensation—Retirement Benefits". Amounts recognized in accumulated other comprehensive income are adjusted as they are subsequently recognized as components of net periodic benefit cost pursuant to the recognition and amortization provisions of those Statements. | |||||||||||
Concentration of Credit Risk | ' | ||||||||||
Concentration of Credit Risk | |||||||||||
Trade receivables subject the Company to the potential for credit risk. To reduce this risk, the Company performs evaluations of its customers' financial condition and creditworthiness at the time of sale, and updates those evaluations when necessary. Three customers made up 42% of trade receivables as of December 31, 2013. No single customer made up more than 10% of trade receivables as of December 31, 2012. | |||||||||||
Use of Estimates | ' | ||||||||||
Use of Estimates | |||||||||||
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions. Such estimates and assumptions affect the reported amounts of assets and liabilities as well as disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |||||||||||
BUSINESS_AND_SUMMARY_OF_SIGNIF2
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||
Schedule of activity in the allowance for doubtful accounts | ' | ||||||||||
Activity in the allowance for doubtful accounts for 2013 and 2012 was as follows (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Beginning balance | $ | 177 | $ | 284 | |||||||
Allowance for doubtful accounts acquired | 460 | — | |||||||||
Additional reserves | 164 | (25 | ) | ||||||||
Writeoffs | 1 | (82 | ) | ||||||||
| | | | | | | | ||||
Ending balance | $ | 802 | $ | 177 | |||||||
| | | | | | | | ||||
| | | | | | | | ||||
Schedule of inventories including costs of materials, direct labor and manufacturing overhead, and stated at the lower of cost (first-in, first-out basis) or market | ' | ||||||||||
Inventories include costs of materials, direct labor and manufacturing overhead, and are stated at the lower of cost (first-in, first-out basis) or market, as follows (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Parts and raw materials | $ | 20,649 | $ | 13,174 | |||||||
Work-in-process | 3,369 | 1,504 | |||||||||
Finished goods | 4,350 | 2,096 | |||||||||
| | | | | | | | ||||
28,368 | 16,774 | ||||||||||
Less reserves | (3,938 | ) | (2,073 | ) | |||||||
| | | | | | | | ||||
Inventories, net | $ | 24,430 | $ | 14,701 | |||||||
| | | | | | | | ||||
| | | | | | | | ||||
Schedule of classification of property, plant and equipment | ' | ||||||||||
Property, plant and equipment is classified as follows (in thousands): | |||||||||||
Useful lives | December 31, | December 31, | |||||||||
2013 | 2012 | ||||||||||
Land | $ | 3,020 | $ | 290 | |||||||
Building and improvements | 5 - 39 years | 7,382 | 3,713 | ||||||||
Machinery, equipment, tools and dies | 3 - 15 years | 40,237 | 13,483 | ||||||||
Furniture, fixtures and other | 3 - 10 years | 4,544 | 3,996 | ||||||||
| | | | | | | | | | ||
55,183 | 21,482 | ||||||||||
Less accumulated depreciation | (15,072 | ) | (12,851 | ) | |||||||
| | | | | | | | | | ||
Property, plant and equipment, net | $ | 40,111 | $ | 8,631 | |||||||
| | | | | | | | | | ||
| | | | | | | | | | ||
Schedule of changes in the reserve for product warranty claims | ' | ||||||||||
Changes in the Company's reserve for product warranty claims during 2013 and 2012 were as follows (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Warranty reserve at beginning of the year | $ | 551 | $ | 372 | |||||||
Warranty reserves acquired | 429 | — | |||||||||
Provision | 175 | 579 | |||||||||
Warranty expenditures | (529 | ) | (411 | ) | |||||||
Effect of foreign currency translation | 3 | 11 | |||||||||
| | | | | | | | ||||
Warranty reserve at end of year | $ | 629 | $ | 551 | |||||||
| | | | | | | | ||||
| | | | | | | | ||||
Schedule of accrued liabilities | ' | ||||||||||
Accrued liabilities consist of the following (in thousands): | |||||||||||
December 31, | December 31, | ||||||||||
2013 | 2012 | ||||||||||
Compensation and fringe benefits | $ | 6,721 | $ | 4,230 | |||||||
Warranty reserve | 629 | 551 | |||||||||
Other accrued expenses | 2,548 | 1,145 | |||||||||
| | | | | | | | ||||
$ | 9,898 | $ | 5,926 | ||||||||
| | | | | | | | ||||
| | | | | | | | ||||
Schedule of financial assets accounted for at fair value on a recurring basis | ' | ||||||||||
The following table presents the Company's financial assets that are accounted for at fair value on a recurring basis as of December 31, 2013 and December 31, 2012, respectively, by level within the fair value hierarchy (in thousands): | |||||||||||
December 31, 2013 | |||||||||||
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Pension Plan Assets | $ | 4,847 | $ | — | $ | — | |||||
Other long term assets | 2,595 | — | — | ||||||||
Interest rate swaps | — | 41 | — | ||||||||
December 31, 2012 | |||||||||||
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Pension Plan Assets | $ | 4,086 | $ | — | $ | — | |||||
Other long term assets | 1,991 | — | — |
ACQUISITIONS_Tables
ACQUISITIONS (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
ACQUISITIONS | ' | ||||
Schedule of purchase price allocation | ' | ||||
The purchase price was allocated to the underlying net assets based on fair value as of the acquisition date, as follows (in thousands): | |||||
December 31, | |||||
2013 | |||||
Trade receivables, net | $ | 16,567 | |||
Inventories, net | 11,142 | ||||
Prepaid expenses and other assets | 2,860 | ||||
Property, plant and equipment | 30,304 | ||||
Amortizable intangible assets | 33,530 | ||||
Goodwill | 14,209 | ||||
Accounts payable | (10,622 | ) | |||
Accrued liabilities | (7,990 | ) | |||
| | | | | |
Net purchase price | $ | 90,000 | |||
| | | | | |
| | | | | |
Schedule of unaudited pro forma financial information | ' | ||||
For the year ended | |||||
December 31, 2013 | |||||
Revenues | $ | 220,692 | |||
Net income | $ | 7,984 | |||
Diluted net income per share | $ | 0.88 |
GOODWILL_Tables
GOODWILL (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
GOODWILL | ' | |||||||
Schedule of change in the carrying amount of goodwill | ' | |||||||
The change in the carrying amount of goodwill for 2013 and 2012 is as follows (in thousands): | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Beginning balance | $ | 5,782 | $ | 5,665 | ||||
Goodwill acquired | 14,209 | — | ||||||
Effect of foreign currency translation | 242 | 117 | ||||||
| | | | | | | | |
Ending balance | $ | 20,233 | $ | 5,782 | ||||
| | | | | | | | |
| | | | | | | | |
INTANGIBLE_ASSETS_Tables
INTANGIBLE ASSETS (Tables) | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||
INTANGIBLE ASSETS | ' | |||||||||||||||||||||
Schedule of intangible assets | ' | |||||||||||||||||||||
Intangible assets on the Company's consolidated balance sheets consist of the following (in thousands): | ||||||||||||||||||||||
December 31, 2013 | December 31, 2012 | |||||||||||||||||||||
Life | Gross | Accumulated | Net Book | Gross | Accumulated | Net Book | ||||||||||||||||
Amount | amortization | Value | Amount | amortization | Value | |||||||||||||||||
Customer lists | 8 - 15 years | $ | 34,166 | $ | (3,821 | ) | $ | 30,345 | $ | 4,364 | $ | (3,212 | ) | $ | 1,152 | |||||||
Trade name | 10 years | 4,775 | (1,012 | ) | 3,763 | 946 | (889 | ) | 57 | |||||||||||||
Design and technologies | 8 - 10 years | 2,730 | (1,637 | ) | 1,093 | 2,626 | (1,427 | ) | 1,199 | |||||||||||||
Patents | 24 | (3 | ) | 21 | 24 | (1 | ) | 23 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | |
Total | $ | 41,695 | $ | (6,473 | ) | $ | 35,222 | $ | 7,960 | $ | (5,529 | ) | $ | 2,431 | ||||||||
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | |
Schedule of estimated amortization expense for intangible assets | ' | |||||||||||||||||||||
Year ending December 31, | Total | |||||||||||||||||||||
2014 | $ | 2,685 | ||||||||||||||||||||
2015 | 2,671 | |||||||||||||||||||||
2016 | 2,671 | |||||||||||||||||||||
2017 | 2,671 | |||||||||||||||||||||
2018 | 2,671 | |||||||||||||||||||||
Thereafter | 21,853 | |||||||||||||||||||||
| | | | | ||||||||||||||||||
$ | 35,222 | |||||||||||||||||||||
| | | | | ||||||||||||||||||
| | | | | ||||||||||||||||||
DEBT_OBLIGATIONS_Tables
DEBT OBLIGATIONS (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
DEBT OBLIGATIONS | ' | |||||||
Schedule of debt obligations | ' | |||||||
Debt obligations consisted of the following (in thousands): | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Current Borrowings | ||||||||
Revolving Credit Facility (2.7% at December 31, 2013) | $ | 7,725 | $ | — | ||||
China Credit Facility (6.2% at December 31, 2013) | 1,170 | 397 | ||||||
Term Loan, current portion, (2.7% at December 31, 2013)(1) | 5,250 | — | ||||||
| | | | | | | | |
Current borrowings | $ | 14,145 | $ | 397 | ||||
| | | | | | | | |
| | | | | | | | |
Long-term Debt | ||||||||
Term Loan, noncurrent (2.7% at December 31, 2013)(1) | $ | 43,500 | $ | — | ||||
Subordinated Notes (14.5%, 13% Cash, 1.5% PIK) | 30,000 | — | ||||||
| | | | | | | | |
Long-term debt | $ | 73,500 | $ | — | ||||
| | | | | | | | |
| | | | | | | | |
-1 | ||||||||
The effective rate of the Term Loan including the impact of the related hedges is 3.14%. | ||||||||
Schedule of maturities of long-term debt | ' | |||||||
Year ending December 31, | Total | |||||||
2014 | $ | 14,145 | ||||||
2015 | 6,375 | |||||||
2016 | 8,219 | |||||||
2017 | 10,374 | |||||||
2018 | 18,532 | |||||||
Thereafter | 30,000 | |||||||
| | | | | ||||
Total | $ | 87,645 | ||||||
| | | | | ||||
| | | | | ||||
DERIVATIVE_FINANCIAL_INSTRUMEN1
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | ||||||||||||||
Dec. 31, 2013 | |||||||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ||||||||||||||
Schedule of fair value of the Company's derivative financial instruments as well as their classification on the consolidated balance sheets | ' | ||||||||||||||
The table below presents the fair value of the Company's derivative financial instruments as well as their classification on the consolidated balance sheets as of December 31, 2013 (in thousands): | |||||||||||||||
Derivative Instrument | Balance Sheet Location | December 31, 2013 | |||||||||||||
Fair Value | |||||||||||||||
Interest Rate Swaps | Prepaid expenses and other assets | $ | 41 | ||||||||||||
| | | | | | | |||||||||
| | | | | | | |||||||||
Schedule of effect of the Company's derivative financial instruments on the consolidated statement of income and comprehensive income | ' | ||||||||||||||
The effect of the Company's derivative financial instruments on the consolidated statement of income and comprehensive income is as follows (in thousands): | |||||||||||||||
For the year ended December 31, 2013 | For the year ended December 31, 2013 | For the year ended December 31, 2013 | |||||||||||||
Derivative | Net deferral | Statement of | Net | Statement of | Amount recognized | ||||||||||
Instruments | in OCI of | earnings | reclassification | earnings | in income (ineffective | ||||||||||
derivatives | classification | from AOCI into | classification | portion and amount | |||||||||||
(effective | income (effective | excluded from | |||||||||||||
portion) | portion) | effectiveness testing) | |||||||||||||
Interest Rate Swaps | $ | — | Interest expense | $ | (41 | ) | Other (expense) | $ | — | ||||||
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
INCOME TAXES | ' | |||||||
Schedule of provision for income taxes based on income before income taxes | ' | |||||||
The provision for income taxes is based on income before income taxes as follows (in thousands): | ||||||||
For the year ended | For the year ended | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Domestic | $ | 1,406 | $ | 3,725 | ||||
Foreign | 4,375 | 3,773 | ||||||
| | | | | | | | |
Income before income taxes | $ | 5,781 | $ | 7,498 | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of components of the total provision for income taxes | ' | |||||||
Components of the total provision for income taxes are as follows (in thousands): | ||||||||
For the year ended | For the year ended | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Current provision | ||||||||
Domestic | $ | 1,179 | $ | 115 | ||||
Foreign | 898 | 881 | ||||||
| | | | | | | | |
Total current provision | 2,077 | 996 | ||||||
| | | | | | | | |
Deferred provision | ||||||||
Domestic | (197 | ) | 1,162 | |||||
Foreign | (52 | ) | (57 | ) | ||||
| | | | | | | | |
Total deferred provision | (249 | ) | 1,105 | |||||
| | | | | | | | |
Provision for income taxes | $ | 1,828 | $ | 2,101 | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of differences in the provision for income taxes from the amount determined by applying the federal statutory rate | ' | |||||||
The provision for income taxes differs from the amount determined by applying the federal statutory rate as follows (in thousands): | ||||||||
For the year ended | For the year ended | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Tax provision, computed at statutory rate | 34 | % | 34 | % | ||||
State tax, net of federal impact | 3.7 | % | 3.3 | % | ||||
Effect of foreign tax rate differences and foreign tax adjustments | (9.7 | )% | (6.0 | )% | ||||
Dividend from foreign subsidiary, net of foreign tax credit | 3.5 | % | 0 | % | ||||
Adjustments to prior year accruals(1) | 0 | % | (1.9 | )% | ||||
Other | 0.1 | % | (1.4 | )% | ||||
| | | | | | | | |
Provision for income taxes | 31.6 | % | 28 | % | ||||
| | | | | | | | |
| | | | | | | | |
-1 | ||||||||
Adjustments relate to the resolution of certain prior year income tax related matters. | ||||||||
Schedule of tax effects of significant temporary differences and credit and operating loss carryforwards that give rise to the net deferred tax assets and tax liabilities | ' | |||||||
The tax effects of significant temporary differences and credit and operating loss carryforwards that give rise to the net deferred tax assets and tax liabilities are as follows (in thousands): | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Current deferred tax assets: | ||||||||
Allowances and other | $ | 1,315 | $ | 591 | ||||
Net operating loss and tax credit carryforwards | 3,628 | 98 | ||||||
| | | | | | | | |
Total current deferred tax assets | 4,943 | 689 | ||||||
Valuation allowance | (1,982 | ) | (50 | ) | ||||
| | | | | | | | |
Net current deferred tax assets | $ | 2,961 | $ | 639 | ||||
| | | | | | | | |
| | | | | | | | |
Noncurrent deferred tax assets: | ||||||||
Employee benefit plans | $ | 2,074 | $ | 1,375 | ||||
Goodwill and Intangibles | 1,553 | 2,916 | ||||||
Property, plant & equipment | (381 | ) | (188 | ) | ||||
| | | | | | | | |
Total noncurrent deferred tax assets | $ | 3,246 | $ | 4,103 | ||||
| | | | | | | | |
| | | | | | | | |
Deferred tax liabilities: | ||||||||
Acquired property, plant and equipment and intangible assets | $ | 1,997 | $ | 638 | ||||
Other | 330 | 297 | ||||||
| | | | | | | | |
Total deferred tax liabilities | $ | 2,327 | $ | 935 | ||||
| | | | | | | | |
| | | | | | | | |
STOCKBASED_COMPENSATION_PLANS_
STOCK-BASED COMPENSATION PLANS (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
STOCK-BASED COMPENSATION PLANS | ' | ||||
Summary of restricted stock activity | ' | ||||
Number of Nonvested | |||||
Restricted Shares | |||||
Balance, December 31, 2011 | 283,608 | ||||
Awarded | 140,150 | ||||
Forfeited | (21,398 | ) | |||
Vested | (159,236 | ) | |||
| | | | | |
Balance, December 31, 2012 | 243,124 | ||||
Awarded | 423,518 | ||||
Forfeited | (3,181 | ) | |||
Vested | (143,266 | ) | |||
| | | | | |
Balance, December 31, 2013 | 520,195 | ||||
| | | | | |
| | | | | |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
Schedule of minimum future rental commitments under all non-cancelable operating leases | ' | ||||
Minimum future rental commitments under all non-cancelable operating leases are as follows (in thousands): | |||||
Year ending December 31, | Total | ||||
2014 | $ | 1,727 | |||
2015 | 1,349 | ||||
2016 | 1,304 | ||||
2017 | 993 | ||||
2018 | 715 | ||||
Thereafter | 3,027 | ||||
| | | | | |
$ | 9,115 | ||||
| | | | | |
| | | | | |
PENSION_AND_POSTRETIREMENT_WEL1
PENSION AND POSTRETIREMENT WELFARE PLANS (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Pension Plan | ' | |||||||
Pension and postretirement welfare plans | ' | |||||||
Schedule of reconciliation of the change in benefit obligation, the change in plan assets and the net amount recognized in the consolidated balance sheet | ' | |||||||
The following tables provide a reconciliation of the change in benefit obligation, the change in plan assets and the net amount recognized in the consolidated balance sheets at December 31, 2013 and December 31, 2012 (in thousands): | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Change in projected benefit obligation: | ||||||||
Projected benefit obligation at beginning of period | $ | 6,277 | $ | 5,556 | ||||
Service cost | 103 | 122 | ||||||
Employee contributions | 10 | 9 | ||||||
Interest cost | 241 | 259 | ||||||
Actuarial (gain) loss | (638 | ) | 580 | |||||
Benefits paid | (255 | ) | (249 | ) | ||||
| | | | | | | | |
Projected benefit obligation at end of period | $ | 5,738 | $ | 6,277 | ||||
| | | | | | | | |
| | | | | | | | |
Change in plan assets: | ||||||||
Fair value of plan assets at beginning of period | $ | 4,086 | $ | 3,418 | ||||
Actual return on plan assets | 691 | 469 | ||||||
Employee contributions | 10 | 9 | ||||||
Employer contributions | 315 | 439 | ||||||
Benefits and expenses paid | (255 | ) | (249 | ) | ||||
| | | | | | | | |
Fair value of plan assets at end of period | $ | 4,847 | $ | 4,086 | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of reconciliation of accumulated other comprehensive income from the prior measurement date to the current measurement date | ' | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Excess of projected benefit obligation over fair value of plan assets | $ | 891 | $ | 2,191 | ||||
Unrecognized loss | (875 | ) | (2,088 | ) | ||||
| | | | | | | | |
Accrued pension cost prior to pension adjustments | $ | 16 | $ | 103 | ||||
Accumulated Other Comprehensive Income at Current Measurement Date | 875 | 2,088 | ||||||
| | | | | | | | |
Accrued pension cost at end of period | $ | 891 | $ | 2,191 | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of benefits expected to be paid | ' | |||||||
Benefits expected to be paid from the Plan during each of the next five fiscal years, and in aggregate for the five fiscal years thereafter are (in thousands): | ||||||||
Year of payment | Amount of | |||||||
Benefit | ||||||||
Payment | ||||||||
2014 | $ | 289 | ||||||
2015 | 308 | |||||||
2016 | 311 | |||||||
2017 | 326 | |||||||
2018 | 326 | |||||||
2019 - 2023 | 1,863 | |||||||
Schedule of components of net periodic expense | ' | |||||||
Components of net periodic pension expense included in the consolidated statements of income and comprehensive income for years 2013 and 2012 are as follows (in thousands): | ||||||||
For the | For the | |||||||
year ended | year ended | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Service cost | $ | 103 | $ | 122 | ||||
Interest cost | 241 | 259 | ||||||
Amortization of net loss | 172 | 150 | ||||||
Expected return on assets | (288 | ) | (245 | ) | ||||
| | | | | | | | |
Net periodic pension expense | $ | 228 | $ | 286 | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of weighted average assumptions used to determine the projected defined benefit obligation | ' | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Discount rate | 4.75 | % | 4 | % | ||||
Rate of compensation increases | 2 | % | 5 | % | ||||
Schedule of weighted average assumptions used to determine net periodic pension expense | ' | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Discount rate | 4 | % | 4.75 | % | ||||
Expected long-term rate of return on plan assets | 7 | % | 7 | % | ||||
Rate of compensation increases | 5 | % | 5 | % | ||||
Schedule of pension plan assets allocation | ' | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Cash equivalents | 5 | % | 4 | % | ||||
Equity securities | 64 | % | 65 | % | ||||
Fixed income securities | 31 | % | 31 | % | ||||
| | | | | | | | |
Total | 100 | % | 100 | % | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of ranges for asset allocation percentages based on the Plan's Investment Policy Guidelines | ' | |||||||
Equity securities | 55 - 75% | |||||||
Fixed income securities | 25 - 45% | |||||||
Cash | 0 - 20% | |||||||
| | | ||||||
Total | 100% | |||||||
| | | ||||||
| | | ||||||
Postretirement Welfare Plan | ' | |||||||
Pension and postretirement welfare plans | ' | |||||||
Schedule of reconciliation of the change in benefit obligation, the change in plan assets and the net amount recognized in the consolidated balance sheet | ' | |||||||
The following tables provide a reconciliation of the change in the accumulated postretirement benefit obligation and the net amount recognized in the consolidated balance sheets at December 31, 2013 and December 31, 2012 (in thousands): | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Change in postretirement benefit obligation: | ||||||||
Accumulated post retirement benefit obligation at beginning of period | $ | 1,621 | $ | 1,378 | ||||
Service cost | 16 | 22 | ||||||
Interest cost | 60 | 67 | ||||||
Actuarial (gain) loss | (243 | ) | 227 | |||||
Benefits paid | (47 | ) | (73 | ) | ||||
| | | | | | | | |
Accumulated postretirement benefit obligation at end of period | $ | 1,407 | $ | 1,621 | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of benefits expected to be paid | ' | |||||||
Benefits expected to be paid from the Plan during each of the next five fiscal years, and in aggregate for the five fiscal years thereafter are (in thousands): | ||||||||
Year of payment | Amount of | |||||||
Benefit Payment | ||||||||
2014 | $ | 58 | ||||||
2015 | 62 | |||||||
2016 | 60 | |||||||
2017 | 68 | |||||||
2018 | 64 | |||||||
2019 - 2023 | 404 |
SEGMENT_INFORMATION_Tables
SEGMENT INFORMATION (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
SEGMENT INFORMATION | ' | |||||||
Schedule of financial information related to the foreign subsidiaries | ' | |||||||
Financial information related to the foreign subsidiaries is summarized below (in thousands): | ||||||||
For the year ended | ||||||||
and as of | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Revenues derived from foreign subsidiaries | $ | 51,199 | $ | 42,172 | ||||
Identifiable assets | 55,627 | 26,525 |
SELECTED_QUARTERLY_FINANCIAL_D1
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) | ' | |||||||||||||
Schedule of selected quarterly financial data | ' | |||||||||||||
Year 2013 | First | Second | Third | Fourth | ||||||||||
Quarter | Quarter | Quarter | Quarter | |||||||||||
Revenues | $ | 25,143 | $ | 25,352 | $ | 24,876 | $ | 50,131 | ||||||
Gross margin | 7,523 | 7,535 | 7,238 | 14,226 | ||||||||||
Net income | 960 | 819 | 833 | 1,341 | ||||||||||
Basic income per share | 0.11 | 0.09 | 0.09 | 0.15 | ||||||||||
Diluted income per share | 0.11 | 0.09 | 0.09 | 0.15 | ||||||||||
Year 2012 | First | Second | Third | Fourth | ||||||||||
Quarter | Quarter | Quarter | Quarter | |||||||||||
Revenues | $ | 26,847 | $ | 26,836 | $ | 24,316 | $ | 23,969 | ||||||
Gross margin | 7,637 | 8,151 | 7,099 | 6,753 | ||||||||||
Net income | 1,158 | 1,817 | 1,321 | 1,101 | ||||||||||
Basic income per share | 0.14 | 0.21 | 0.15 | 0.13 | ||||||||||
Diluted income per share | 0.14 | 0.21 | 0.15 | 0.13 |
BUSINESS_AND_SUMMARY_OF_SIGNIF3
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Activity in the allowance for doubtful accounts | ' | ' |
Beginning balance | $177 | $284 |
Allowance for doubtful accounts acquired | 460 | ' |
Additional reserves | 164 | -25 |
Write-offs | 1 | -82 |
Ending balance | 802 | 177 |
Inventories | ' | ' |
Parts and raw materials | 20,649 | 13,174 |
Work-in-process | 3,369 | 1,504 |
Finished goods | 4,350 | 2,096 |
Inventory, gross | 28,368 | 16,774 |
Less reserves | -3,938 | -2,073 |
Inventories, net | 24,430 | 14,701 |
Provision for excess and obsolete inventory | $105 | $265 |
BUSINESS_AND_SUMMARY_OF_SIGNIF4
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Property, plant and equipment | ' | ' |
Property, plant and equipment, gross | $55,183 | $21,482 |
Less accumulated depreciation | -15,072 | -12,851 |
Property, plant and equipment, net | 40,111 | 8,631 |
Depreciation expense | 2,088 | 1,250 |
Land | ' | ' |
Property, plant and equipment | ' | ' |
Property, plant and equipment, gross | 3,020 | 290 |
Building and improvements | ' | ' |
Property, plant and equipment | ' | ' |
Property, plant and equipment, gross | 7,382 | 3,713 |
Building and improvements | Minimum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '5 years | ' |
Building and improvements | Maximum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '39 years | ' |
Machinery, equipment, tools and dies | ' | ' |
Property, plant and equipment | ' | ' |
Property, plant and equipment, gross | 40,237 | 13,483 |
Machinery, equipment, tools and dies | Minimum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '3 years | ' |
Machinery, equipment, tools and dies | Maximum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '15 years | ' |
Furniture, fixtures and other | ' | ' |
Property, plant and equipment | ' | ' |
Property, plant and equipment, gross | 4,544 | 3,996 |
Furniture, fixtures and other | Minimum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '3 years | ' |
Furniture, fixtures and other | Maximum | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '10 years | ' |
Computer software and software development costs | ' | ' |
Property, plant and equipment | ' | ' |
Useful lives | '7 years | ' |
Capitalization of software costs | $488 | $1,072 |
BUSINESS_AND_SUMMARY_OF_SIGNIF5
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 3) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Supplier | ||
Changes in the reserve for product warranty claims | ' | ' |
Warranty reserve at beginning of the year | $551 | $372 |
Warranty reserves acquired | 429 | ' |
Provision | 175 | 579 |
Warranty expenditures | -529 | -411 |
Effect of foreign currency translation | 3 | 11 |
Warranty reserve at end of year | 629 | 551 |
Expected costs of replacing certain products in the field due to an incorrect electronic component in a printed circuit board | ' | 342 |
Number of Company's sub-contract suppliers who supplied an incorrect electronic component | ' | 1 |
Additional provision recorded to replace certain products in the field due to an incorrect electronic component in a printed circuit board | 44 | ' |
Warranty expenditures incurred related to replacing certain products in the field due to an incorrect electronic component in a printed circuit board | 367 | ' |
Reserve, net of the effect of foreign currency translation related to replacing certain products in the field due to an incorrect electronic component in a printed circuit board | 30 | ' |
Accrued Liabilities | ' | ' |
Compensation and fringe benefits | 6,721 | 4,230 |
Warranty reserve | 629 | 551 |
Other accrued expenses | 2,548 | 1,145 |
Accrued liabilities | $9,898 | $5,926 |
Basic and Diluted Income per Share from Continuing Operations | ' | ' |
Dilutive effect of outstanding stock option awards (in shares) | 7 | 0 |
Stock awards excluded from the calculation of diluted income per share (in shares) | 0 | 0 |
BUSINESS_AND_SUMMARY_OF_SIGNIF6
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 4) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Assets | ' | ' |
Other long term assets | $4,878 | $1,991 |
Recurring basis | Level 1 | ' | ' |
Assets | ' | ' |
Pension Plan Assets | 4,847 | 4,086 |
Other long term assets | 2,595 | 1,991 |
Recurring basis | Level 2 | ' | ' |
Assets | ' | ' |
Interest rate swaps | $41 | ' |
BUSINESS_AND_SUMMARY_OF_SIGNIF7
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 5) (Trade receivables, Customer) | 12 Months Ended |
Dec. 31, 2013 | |
customer | |
Trade receivables | Customer | ' |
Concentration of credit risk | ' |
Number of customers | 3 |
Concentration risk (as a percent) | 42.00% |
ACQUISITIONS_Details
ACQUISITIONS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Aug. 22, 2013 | Aug. 22, 2013 | Aug. 22, 2013 | Dec. 31, 2013 |
In Thousands, except Per Share data, unless otherwise specified | Globe Motors | Globe Motors | Globe Motors | Globe Motors | |||
Customer lists | Trade name | Trade name | |||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' | ' |
Cash consideration paid | ' | ' | ' | $90,000 | ' | ' | ' |
Cash paid for acquisition | ' | ' | ' | 4,300 | ' | ' | ' |
Transaction costs related to acquisition | ' | ' | ' | 1,913 | ' | ' | ' |
Purchase price allocation | ' | ' | ' | ' | ' | ' | ' |
Trade receivables, net | ' | ' | ' | 16,567 | ' | ' | ' |
Inventories, net | ' | ' | ' | 11,142 | ' | ' | ' |
Prepaid expenses and other assets | ' | ' | ' | 2,860 | ' | ' | ' |
Property, plant and equipment | ' | ' | ' | 30,304 | ' | ' | ' |
Amortizable intangible assets | ' | ' | ' | 33,530 | ' | ' | ' |
Goodwill | 20,233 | 5,782 | 5,665 | 14,209 | ' | ' | ' |
Accounts payable | ' | ' | ' | -10,622 | ' | ' | ' |
Accrued liabilities | ' | ' | ' | -7,990 | ' | ' | ' |
Net purchase price | ' | ' | ' | 90,000 | ' | ' | ' |
Amortization period of intangible assets | ' | ' | ' | ' | '15 years | '10 years | ' |
Unaudited pro forma financial information | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | 220,692 |
Net income | ' | ' | ' | ' | ' | ' | $7,984 |
Diluted net income per share (in dollars per share) | ' | ' | ' | ' | ' | ' | $0.88 |
GOODWILL_Details
GOODWILL (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Change in goodwill | ' | ' |
Beginning balance | $5,782 | $5,665 |
Goodwill acquired | 14,209 | ' |
Effect of foreign currency translation | 242 | 117 |
Ending balance | $20,233 | $5,782 |
INTANGIBLE_ASSETS_Details
INTANGIBLE ASSETS (Details) (USD $) | 12 Months Ended | 12 Months Ended | 12 Months Ended | ||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Aug. 22, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 |
Globe Motors | Customer lists | Customer lists | Customer lists | Customer lists | Trade name | Trade name | Design and technologies | Design and technologies | Design and technologies | Design and technologies | Patents | Patents | |||
Minimum | Maximum | Minimum | Maximum | ||||||||||||
Intangible assets subject to amortization | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross Amount | $41,695 | $7,960 | ' | $34,166 | $4,364 | ' | ' | $4,775 | $946 | $2,730 | $2,626 | ' | ' | $24 | $24 |
Accumulated amortization | -6,473 | -5,529 | ' | -3,821 | -3,212 | ' | ' | -1,012 | -889 | -1,637 | -1,427 | ' | ' | -3 | -1 |
Net Book Value | 35,222 | 2,431 | ' | 30,345 | 1,152 | ' | ' | 3,763 | 57 | 1,093 | 1,199 | ' | ' | 21 | 23 |
Estimated Life | ' | ' | ' | ' | ' | '8 years | '15 years | '10 years | ' | ' | ' | '8 years | '10 years | ' | ' |
Intangible assets acquired from the acquisition | ' | ' | 33,530 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization expense for intangible assets | 825 | 548 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 2,685 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | 2,671 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 | 2,671 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | 2,671 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2018 | 2,671 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Thereafter | 21,853 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Book Value | $35,222 | $2,431 | ' | $30,345 | $1,152 | ' | ' | $3,763 | $57 | $1,093 | $1,199 | ' | ' | $21 | $23 |
DEBT_OBLIGATIONS_Details
DEBT OBLIGATIONS (Details) | 12 Months Ended | 12 Months Ended | 0 Months Ended | 0 Months Ended | 12 Months Ended | 12 Months Ended | 0 Months Ended | ||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Dec. 31, 2013 | Oct. 18, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Oct. 18, 2013 | Dec. 31, 2013 | Oct. 17, 2013 | Oct. 17, 2013 | Oct. 17, 2013 |
USD ($) | USD ($) | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Revolving Credit Facility | Revolving Credit Facility | Term Loan | Term Loan | China Credit Facility | China Credit Facility | China Credit Facility | Subordinated Notes | Subordinated Notes | Prior Credit Agreement, revolving credit | Prior Credit Agreement, revolving credit | Prior Credit Agreement, revolving credit | |
USD ($) | Maximum | Base Rate | Base Rate | Base Rate | Eurocurrency Rate | Eurocurrency Rate | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | Chinese Renminbi ("RMB") | USD ($) | USD ($) | USD ($) | USD | Euro | |||
Minimum | Maximum | Minimum | Maximum | CNY | USD ($) | EUR (€) | |||||||||||||||
Debt Obligations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current borrowings | $14,145 | $397 | ' | ' | ' | ' | ' | ' | ' | ' | $7,725 | ' | $5,250 | $1,170 | $397 | ' | ' | ' | ' | ' | ' |
Interest rate at period end (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.70% | ' | 2.70% | 6.20% | ' | ' | ' | ' | ' | ' | ' |
Long-term debt | 73,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 43,500 | ' | ' | ' | ' | 30,000 | ' | ' | ' |
Effective rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.14% | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14.50% | ' | ' | ' | ' |
Interest rate payable in cash (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 13.00% | ' | ' | ' | ' |
Interest rate payable in-kind (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.50% | ' | ' | ' | ' |
Maximum borrowing capacity | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15,000 | ' | 50,000 | ' | 1,600 | ' | 9,500 | ' | ' | ' | 4,000 | 3,000 |
Debt instrument term | ' | ' | ' | '6 years | ' | ' | ' | ' | ' | '5 years | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount of debt borrowed | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 30,000 | ' | ' | ' | ' |
Reference rate | ' | ' | ' | ' | 'Base Rate | 'Base Rate | 'Base rate | 'Eurocurrency Rate | 'Eurocurrency Rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Applicable margin (as a percent) | ' | ' | ' | ' | 1.50% | 0.25% | 2.00% | 1.25% | 3.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average outstanding borrowings | ' | ' | 13,200 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 766 | ' | 4,700 | ' | ' | ' | ' | ' |
Available borrowing capacity | ' | ' | 7,300 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 386 | ' | 2,400 | ' | ' | ' | ' | ' |
Amounts outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' |
Percentage of principal amount of notes that may prepay | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' |
Deferred financing costs | 2,377 | ' | 2,377 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maturities of long-term debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 14,145 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | 6,375 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 | 8,219 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | 10,374 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2018 | 18,532 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Thereafter | 30,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total | 87,645 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred financing costs net of accumulated amortization | ' | ' | $2,284 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
DERIVATIVE_FINANCIAL_INSTRUMEN2
DERIVATIVE FINANCIAL INSTRUMENTS (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Oct. 31, 2013 |
instrument | ||
Senior Credit Facilities | Minimum | ' | ' |
Derivative financial instruments | ' | ' |
Derivative contracts required to be entered into, expressed as a percentage of the balance of the Term Loan | ' | 50.00% |
Interest rate swap | ' | ' |
Derivative financial instruments | ' | ' |
Number of derivative instruments | ' | 2 |
Notional amount of interest rate swap derivatives | ' | $25,000 |
Notional amount of interest rate swap derivatives at maturity | ' | 6,673 |
Hedge ineffectiveness recorded in earnings | 0 | ' |
Estimated amount to be reclassified as an increase to interest expense | -212 | ' |
Effect of derivative financial instruments on the consolidated statement of income and comprehensive income | ' | ' |
Net reclassification from AOCI into income (effective portion) | -41 | ' |
Fair value of derivatives including accrued interest but excludes any adjustment for nonperformance risk | 44 | ' |
Interest rate swap | Prepaid expenses and other assets | ' | ' |
Derivative financial instruments | ' | ' |
Fair value of derivatives | $41 | ' |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule of components of income before income taxes | ' | ' |
Domestic | $1,406 | $3,725 |
Foreign | 4,375 | 3,773 |
Income before income taxes | 5,781 | 7,498 |
Current provision | ' | ' |
Domestic | 1,179 | 115 |
Foreign | 898 | 881 |
Total current provision | 2,077 | 996 |
Deferred provision | ' | ' |
Domestic | -197 | 1,162 |
Foreign | -52 | -57 |
Total deferred provision | -249 | 1,105 |
Provision for income taxes | 1,828 | 2,101 |
Differences in the provision for income taxes from the amount determined by applying the federal statutory rate | ' | ' |
Tax provision, computed at statutory rate (as a percent) | 34.00% | 34.00% |
State tax, net of federal impact (as a percent) | 3.70% | 3.30% |
Effect of foreign tax rate differences and foreign tax adjustments (as a percent) | -9.70% | -6.00% |
Dividend from foreign subsidiary, net of foreign tax credit (as a percent) | 3.50% | 0.00% |
Adjustments to prior year accruals (as a percent) | 0.00% | -1.90% |
Other (as a percent) | 0.10% | -1.40% |
Provision for income taxes (as a percent) | 31.60% | 28.00% |
Current deferred tax assets: | ' | ' |
Allowances and other | 1,315 | 591 |
Net operating loss and tax credit carryforwards | 3,628 | 98 |
Total current deferred tax assets | 4,943 | 689 |
Valuation allowance | -1,982 | -50 |
Net current deferred tax assets | 2,961 | 639 |
Noncurrent deferred tax assets: | ' | ' |
Employee benefit plans | 2,074 | 1,375 |
Goodwill and Intangibles | 1,553 | 2,916 |
Property, plant & equipment | -381 | -188 |
Total noncurrent deferred tax assets | 3,246 | 4,103 |
Deferred tax liabilities: | ' | ' |
Acquired property, plant and equipment and intangible | 1,997 | 638 |
Other | 330 | 297 |
Total deferred tax liabilities | $2,327 | $935 |
INCOME_TAXES_Details_2
INCOME TAXES (Details 2) (USD $) | Dec. 31, 2010 | Dec. 31, 2013 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | Globe Motors, Inc. | Foreign | |
Globe Motors, Inc. | |||
Income taxes | ' | ' | ' |
Net operating loss carryforwards expiring in 2014 through 2017 | ' | ' | $3,300 |
Tax credit carryforwards expiring in 2018 | ' | ' | 212 |
Deferred tax benefit from acquired foreign operating losses and tax credit carryforwards | 0 | ' | ' |
Dividends paid by foreign subsidiaries | ' | $3,400 | ' |
STOCKBASED_COMPENSATION_PLANS_1
STOCK-BASED COMPENSATION PLANS (Details) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
STOCK-BASED COMPENSATION PLANS | ' | ' |
Shares of common stock available for grant under stock incentive plans | 852,493 | ' |
Restricted Stock | ' | ' |
Stock-Based Compensation | ' | ' |
Weighted average value (in dollars per share) | $7.73 | $7.10 |
Service period over which value of the shares is amortized to compensation expense | '3 years | ' |
Number of Nonvested Restricted Shares | ' | ' |
Outstanding at beginning of period (in shares) | 243,124 | 283,608 |
Awarded/Granted (in shares) | 423,518 | 140,150 |
Forfeited (in shares) | -3,181 | -21,398 |
Vested (in shares) | -143,266 | -159,236 |
Outstanding at end of period (in shares) | 520,195 | 243,124 |
Additional disclosures | ' | ' |
Compensation expense, net of forfeitures | $927 | $609 |
Unrecognized compensation expense | 3,264 | ' |
Unrecognized compensation expense, expected to be recognized in 2014 | $950 | ' |
Restricted Stock | Performance based vesting | Awards granted in 2013 | ' | ' |
Number of Nonvested Restricted Shares | ' | ' |
Awarded/Granted (in shares) | 58,909 | ' |
Outstanding at end of period (in shares) | 18,775 | ' |
Restricted Stock | Performance based vesting | Awards granted in 2013, which did not achieve performance criteria | ' | ' |
Number of Nonvested Restricted Shares | ' | ' |
Forfeited (in shares) | -34,944 | ' |
Outstanding at end of period (in shares) | 5,190 | ' |
Restricted Stock | Performance based vesting | Awards granted in 2012 | ' | ' |
Number of Nonvested Restricted Shares | ' | ' |
Awarded/Granted (in shares) | ' | 30,000 |
Forfeited (in shares) | ' | -20,000 |
Outstanding at end of period (in shares) | 10,000 | ' |
STOCKBASED_COMPENSATION_PLANS_2
STOCK-BASED COMPENSATION PLANS (Details 2) (ESOP, USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
ESOP | ' | ' |
Employee Stock Ownership Plan | ' | ' |
Minimum hours of work per year for employees to be covered under Employee Stock Ownership Plan (ESOP) | 1,000 | ' |
Annual contribution by employer as a percentage of pretax income before the contribution | 5.00% | 5.00% |
Company contributions | $304 | $395 |
STOCKBASED_COMPENSATION_PLANS_3
STOCK-BASED COMPENSATION PLANS (Details 3) (USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Defined Contribution Plan | ' | ' |
Matching percentage per dollar of the first 3% of participant deferral | 100.00% | 100.00% |
First specified percentage of participant deferral upon which employer matches 100% contribution per dollar | 3.00% | 3.00% |
Matching percentage per dollar of the next 2% contribution | 50.00% | 50.00% |
Next specified percentage of employee contribution upon which employer matches 50% contribution per dollar | 2.00% | 2.00% |
Participant deferral (as a percent) | 5.00% | 5.00% |
Net costs related to defined contribution plan | $506 | $400 |
Dividends | ' | ' |
Dividends paid (in dollars per share) | $0.10 | $0.10 |
Maximum | ' | ' |
Defined Contribution Plan | ' | ' |
Specified percentage of employee contribution upon which employer matches contribution | 4.00% | 4.00% |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Minimum future rental commitments under all non-cancelable operating leases | ' | ' |
2014 | $1,727 | ' |
2015 | 1,349 | ' |
2016 | 1,304 | ' |
2017 | 993 | ' |
2018 | 715 | ' |
Thereafter | 3,027 | ' |
Minimum future rental commitments | 9,115 | ' |
Rental expense | ' | ' |
Rental expense | 1,248 | 1,144 |
Severance Benefit Agreements | ' | ' |
Severance benefit agreements | ' | ' |
Period of specified benefits to key employees Upon the subsequent severance of employment | '24 months | ' |
Severance payments that could be required to be paid | $5,396 | $5,028 |
DEFERRED_COMPENSATION_ARRANGEM1
DEFERRED COMPENSATION ARRANGEMENTS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
DEFERRED COMPENSATION ARRANGEMENTS | ' | ' |
Amount accrued | $2,599 | $1,997 |
Deferred compensation arrangements | ' | ' |
Amount accrued included in accrued liabilities | 0 | 308 |
Supplemental Executive Retirement Plan | ' | ' |
Deferred compensation arrangements | ' | ' |
Amount that would be contributed to Supplemental Executive Retirement Plan in event of death, disability, or termination without cause for certain key executives | $615 | ' |
PENSION_AND_POSTRETIREMENT_WEL2
PENSION AND POSTRETIREMENT WELFARE PLANS (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Net amount recognized in the consolidated balance sheet | ' | ' |
Accrued pension cost at end of period | $2,298 | $3,812 |
Pension Plan | ' | ' |
Pension plan | ' | ' |
Number of last years of employment in which the employee's compensation is considered for determining benefits | '3 years | ' |
Change in projected benefit obligation: | ' | ' |
Benefit obligation at beginning of period | 6,277 | 5,566 |
Service cost | 103 | 122 |
Employee contributions | 10 | 9 |
Interest cost | 241 | 259 |
Actuarial (gain) loss | -638 | 580 |
Benefits paid | -255 | -249 |
Benefit obligation at end of period | 5,738 | 6,277 |
Change in plan assets: | ' | ' |
Fair value of plan assets at beginning of period | 4,086 | 3,418 |
Actual return on plan assets | 691 | 469 |
Employee contributions | 10 | 9 |
Employer contributions | 315 | 439 |
Benefits and expenses paid | -255 | -249 |
Fair value of plan assets at end of period | 4,847 | 4,086 |
Net amount recognized in the consolidated balance sheet | ' | ' |
Excess of projected benefit obligation over fair value of plan assets | 891 | 2,191 |
Unrecognized loss | -875 | -2,088 |
Accrued pension cost prior to pension adjustments | 16 | 103 |
Accumulated Other Comprehensive Income at Current Measurement Date | 875 | 2,088 |
Accrued pension cost at end of period | 891 | 2,191 |
Accumulated benefit obligation | 5,548 | 6,032 |
Amount of accumulated other comprehensive income expected to be recognized as a plan expense in 2014 | $43 | ' |
PENSION_AND_POSTRETIREMENT_WEL3
PENSION AND POSTRETIREMENT WELFARE PLANS (Details 2) (Pension Plan, USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Pension Plan | ' | ' |
Benefits expected to be paid | ' | ' |
2014 | $289 | ' |
2015 | 308 | ' |
2016 | 311 | ' |
2017 | 326 | ' |
2018 | 326 | ' |
2019 - 2023 | 1,863 | ' |
Components of net periodic expense | ' | ' |
Service cost | 103 | 122 |
Interest cost | 241 | 259 |
Amortization of net loss | 172 | 150 |
Expected return on assets | -288 | -245 |
Net periodic pension expense | $228 | $286 |
Amortization of cumulative gains and losses, threshold, as a percentage of the greater of the Market Related Value of Assets and the Projected Benefit Obligation | 10.00% | ' |
PENSION_AND_POSTRETIREMENT_WEL4
PENSION AND POSTRETIREMENT WELFARE PLANS (Details 3) (Pension Plan, USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Weighted average assumptions used to determine the benefit obligation | ' | ' |
Discount rate (as a percent) | 4.75% | 4.00% |
Rate of compensation increases (as a percent) | 2.00% | 5.00% |
Weighted average assumptions used to determine net periodic expense | ' | ' |
Discount rate (as a percent) | 4.00% | 4.75% |
Expected long-term rate of return on plan assets (as a percent) | 7.00% | 7.00% |
Rate of compensation increases (as a percent) | 5.00% | 5.00% |
Expected contributions | ' | ' |
Expected contributions during 2014 | $285 | ' |
Pension plans' actual percentage of plan assets and the target percentage of plan assets | ' | ' |
Actual percentage of plan assets | 100.00% | 100.00% |
Total (as a percent) | 100.00% | ' |
Cash equivalents | ' | ' |
Pension plans' actual percentage of plan assets and the target percentage of plan assets | ' | ' |
Actual percentage of plan assets | 5.00% | 4.00% |
Equity securities | ' | ' |
Pension plans' actual percentage of plan assets and the target percentage of plan assets | ' | ' |
Actual percentage of plan assets | 64.00% | 65.00% |
Minimum (as a percent) | 55.00% | ' |
Maximum (as a percent) | 75.00% | ' |
Fixed income securities | ' | ' |
Pension plans' actual percentage of plan assets and the target percentage of plan assets | ' | ' |
Actual percentage of plan assets | 31.00% | 31.00% |
Minimum (as a percent) | 25.00% | ' |
Maximum (as a percent) | 45.00% | ' |
Cash | ' | ' |
Pension plans' actual percentage of plan assets and the target percentage of plan assets | ' | ' |
Minimum (as a percent) | 0.00% | ' |
Maximum (as a percent) | 20.00% | ' |
PENSION_AND_POSTRETIREMENT_WEL5
PENSION AND POSTRETIREMENT WELFARE PLANS (Details 4) (Postretirement Welfare Plan, USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Postretirement Welfare Plan | ' | ' |
Postretirement welfare plan | ' | ' |
Requisite service period for employees who retire after January 1, 2005 in order to be eligible for retiree medical benefits | '20 years | ' |
Change in postretirement benefit obligation: | ' | ' |
Benefit obligation at beginning of period | $1,621 | $1,378 |
Service cost | 16 | 22 |
Interest cost | 60 | 67 |
Actuarial (gain) loss | -243 | 227 |
Benefits paid | -47 | -73 |
Benefit obligation at end of period | $1,407 | $1,621 |
PENSION_AND_POSTRETIREMENT_WEL6
PENSION AND POSTRETIREMENT WELFARE PLANS (Details 5) (Postretirement Welfare Plan, USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Postretirement welfare plan | ' | ' |
Net periodic postretirement benefit costs | $30 | $28 |
Amount of accumulated other comprehensive income expected to be recognized as a plan expense in 2014 | ' | ' |
Amount of accumulated other comprehensive income expected to be recognized as a plan expense | 66 | ' |
Weighted average discount rate used in determining the accumulated postretirement benefit obligation | ' | ' |
Discount rate (as a percent) | 4.75% | 4.00% |
Weighted average discount rate used to determine the net periodic postretirement benefit cost | ' | ' |
Discount rate (as a percent) | 4.00% | 4.75% |
Benefits expected to be paid | ' | ' |
2014 | 58 | ' |
2015 | 62 | ' |
2016 | 60 | ' |
2017 | 68 | ' |
2018 | 64 | ' |
2019 - 2023 | 404 | ' |
Expected in 2014 | ' | ' |
Amount of accumulated other comprehensive income expected to be recognized as a plan expense in 2014 | ' | ' |
Actuarial gain | 54 | ' |
Prior service credit | $12 | ' |
SEGMENT_INFORMATION_Details
SEGMENT INFORMATION (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
segment | ||||||||||
SEGMENT INFORMATION | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of operating segments | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' |
Segment information | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | $50,131 | $24,876 | $25,352 | $25,143 | $23,969 | $24,316 | $26,836 | $26,847 | $125,502 | $101,968 |
Identifiable assets | 170,977 | ' | ' | ' | 60,967 | ' | ' | ' | 170,977 | 60,967 |
Outside the United States | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment information | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | ' | ' | 53,988 | 44,761 |
Wholly owned foreign subsidiaries | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment information | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | ' | ' | 51,199 | 42,172 |
Identifiable assets | $55,627 | ' | ' | ' | $26,525 | ' | ' | ' | $55,627 | $26,525 |
SELECTED_QUARTERLY_FINANCIAL_D2
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | $50,131 | $24,876 | $25,352 | $25,143 | $23,969 | $24,316 | $26,836 | $26,847 | $125,502 | $101,968 |
Gross margin | 14,226 | 7,238 | 7,535 | 7,523 | 6,753 | 7,099 | 8,151 | 7,637 | 36,522 | 29,640 |
Net income | $1,341 | $833 | $819 | $960 | $1,101 | $1,321 | $1,817 | $1,158 | $3,953 | $5,397 |
Basic income per share (in dollars per share) | $0.15 | $0.09 | $0.09 | $0.11 | $0.13 | $0.15 | $0.21 | $0.14 | $0.45 | $0.63 |
Diluted income per share (in dollars per share) | $0.15 | $0.09 | $0.09 | $0.11 | $0.13 | $0.15 | $0.21 | $0.14 | $0.45 | $0.63 |