Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 08, 2013 | |
Document and Entity Information | ' | ' |
Entity Registrant Name | 'ALLIED MOTION TECHNOLOGIES INC | ' |
Entity Central Index Key | '0000046129 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-13 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 9,093,389 |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current Assets: | ' | ' |
Cash and cash equivalents | $11,654 | $9,728 |
Trade receivables, net of allowance for doubtful accounts of $189 and $177 at September 30, 2013 and December 31, 2012, respectively | 13,429 | 10,806 |
Inventories, net | 15,167 | 14,701 |
Deferred income taxes | 731 | 639 |
Prepaid expenses and other assets | 1,431 | 2,155 |
Total Current Assets | 42,412 | 38,029 |
Property, plant and equipment, net | 9,649 | 8,631 |
Deferred income taxes | 4,115 | 4,103 |
Intangible assets, net | 2,227 | 2,431 |
Other long-term assets, net | 2,672 | 1,991 |
Goodwill | 5,916 | 5,782 |
Total Assets | 66,991 | 60,967 |
Current Liabilities: | ' | ' |
Debt obligations | 1,141 | 397 |
Accounts payable | 7,628 | 5,748 |
Accrued liabilities | 5,485 | 5,926 |
Total Current Liabilities | 14,254 | 12,071 |
Deferred income taxes | 885 | 935 |
Deferred compensation arrangements | 2,692 | 1,997 |
Pension and post-retirement obligations | 3,694 | 3,812 |
Total Liabilities | 21,525 | 18,815 |
Commitments and Contingencies | ' | ' |
Stockholders' Equity: | ' | ' |
Common stock, no par value, authorized 50,000 shares; 8,845 and 8,631 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively | 23,543 | 22,547 |
Preferred stock, par value $1.00 per share, authorized 5,000 shares; no shares issued or outstanding | ' | ' |
Retained earnings | 22,494 | 20,528 |
Accumulated other comprehensive loss | -571 | -923 |
Total Stockholders' Equity | 45,466 | 42,152 |
Total Liabilities and Stockholders' Equity | $66,991 | $60,967 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, except Per Share data, unless otherwise specified | ||
CONDENSED CONSOLIDATED BALANCE SHEETS | ' | ' |
Trade receivables, allowance for doubtful accounts (in dollars) | $189 | $177 |
Common stock, par value (in dollars per share) | ' | ' |
Common stock, authorized shares | 50,000 | 50,000 |
Common stock, shares issued | 8,845 | 8,631 |
Common stock, shares outstanding | 8,845 | 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 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME | ' | ' | ' | ' |
Revenues | $24,876 | $24,316 | $75,371 | $77,999 |
Cost of products sold | 17,638 | 17,217 | 53,075 | 55,112 |
Gross margin | 7,238 | 7,099 | 22,296 | 22,887 |
Operating costs and expenses: | ' | ' | ' | ' |
Selling | 1,132 | 1,143 | 3,640 | 3,798 |
General and administrative | 2,516 | 2,343 | 8,098 | 8,197 |
Engineering and development | 1,718 | 1,454 | 5,123 | 4,570 |
Business development costs | 596 | ' | 1,235 | ' |
Relocation costs | ' | ' | 234 | ' |
Amortization of intangible assets | 83 | 126 | 252 | 466 |
Total operating costs and expenses | 6,045 | 5,066 | 18,582 | 17,031 |
Operating income | 1,193 | 2,033 | 3,714 | 5,856 |
Other (expense) income, net: | ' | ' | ' | ' |
Interest expense | -13 | -2 | -30 | -12 |
Other expense, net | -38 | -89 | 58 | 230 |
Total other (expense) income, net | -51 | -91 | 28 | 218 |
Income before income taxes | 1,142 | 1,942 | 3,742 | 6,074 |
Provision for income taxes | -309 | -621 | -1,130 | -1,778 |
Net income | 833 | 1,321 | 2,612 | 4,296 |
Foreign currency translation adjustment | 806 | 305 | 352 | -135 |
Comprehensive income | $1,639 | $1,626 | $2,964 | $4,161 |
Basic net income per share: | ' | ' | ' | ' |
Net income per share (in dollars per share) | $0.09 | $0.15 | $0.30 | $0.50 |
Basic weighted average common shares (in shares) | 8,807 | 8,673 | 8,778 | 8,637 |
Diluted net income per share: | ' | ' | ' | ' |
Net income per share (in dollars per share) | $0.09 | $0.15 | $0.30 | $0.50 |
Diluted weighted average common shares (in shares) | 8,807 | 8,673 | 8,778 | 8,637 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash Flows From Operating Activities: | ' | ' |
Net income | $2,612 | $4,296 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 1,311 | 1,361 |
Stock compensation expense | 674 | 446 |
Other | -447 | 692 |
Changes in assets and liabilities: | ' | ' |
Trade receivables | -2,510 | -1,244 |
Inventories, net | -326 | -1,203 |
Prepaid expenses and other assets | -484 | -1,254 |
Accounts payable | 1,796 | -371 |
Accrued liabilities | 818 | -2,076 |
Net cash provided by operating activities | 3,444 | 647 |
Cash Flows From Investing Activities: | ' | ' |
Consideration paid for acquisition | ' | -1,350 |
Purchase of property and equipment | -2,055 | -2,021 |
Net cash used in investing activities | -2,055 | -3,371 |
Cash Flows From Financing Activities: | ' | ' |
Borrowings on line of credit | 724 | ' |
Dividends paid | -646 | -629 |
Stock transactions under employee benefit stock plans | 414 | 355 |
Net cash provided by (used in) financing activities | 492 | -274 |
Effect of foreign exchange rate changes on cash | 45 | 100 |
Net increase (decrease) in cash and cash equivalents | 1,926 | -2,898 |
Cash and cash equivalents at beginning of period | 9,728 | 9,155 |
Cash and cash equivalents at end of period | $11,654 | $6,257 |
Basis_of_Preparation_and_Prese
Basis of Preparation and Presentation | 9 Months Ended |
Sep. 30, 2013 | |
Basis of Preparation and Presentation | ' |
Basis of Preparation and Presentation | ' |
1. Basis of Preparation and Presentation | |
Allied Motion Technologies Inc. (the Company) is engaged in the business of designing, manufacturing and selling motion control products to a broad spectrum of customers throughout the world. | |
The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation. | |
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 accumulated other comprehensive income, a component of stockholders’ equity in the accompanying condensed consolidated balance sheets. 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. | |
The condensed consolidated financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission and include all adjustments which are, in the opinion of management, necessary for a fair presentation. Certain information and footnote disclosures normally included in financial statements which are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. The Company believes that the disclosures herein are adequate to make the information presented not misleading. The financial data for the interim periods may not necessarily be indicative of results to be expected for the year. | |
The preparation of financial statements in accordance with U.S. GAAP 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 revenue and expenses during the reporting period. Actual results could differ from those estimates. | |
It is suggested that the accompanying condensed consolidated interim financial statements be read in conjunction with the Consolidated Financial Statements and related Notes to such statements included in the Annual Report on Form 10-K for the year ended December 31, 2012 that was previously filed by the Company. | |
Inventories
Inventories | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Inventories | ' | |||||||
Inventories | ' | |||||||
2. Inventories | ||||||||
Inventories, valued at the lower of cost (first-in, first-out basis) or market, are as follows (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Parts and raw materials | $ | 12,345 | $ | 13,174 | ||||
Work-in process | 1,781 | 1,504 | ||||||
Finished goods | 3,062 | 2,096 | ||||||
17,188 | 16,774 | |||||||
Less reserves | (2,021 | ) | (2,073 | ) | ||||
Inventories, net | $ | 15,167 | $ | 14,701 | ||||
Property_Plant_and_Equipment
Property, Plant and Equipment | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Property, Plant and Equipment | ' | |||||||
Property, Plant and Equipment | ' | |||||||
3. Property, Plant and Equipment | ||||||||
Property, plant and equipment is classified as follows (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Land | $ | 290 | $ | 290 | ||||
Building and improvements | 3,961 | 3,713 | ||||||
Machinery, equipment, tools and dies | 15,183 | 13,483 | ||||||
Furniture, fixtures and other | 4,159 | 3,996 | ||||||
23,593 | 21,482 | |||||||
Less accumulated depreciation | (13,944 | ) | (12,851 | ) | ||||
Property, Plant and Equipment, net | $ | 9,649 | $ | 8,631 | ||||
Depreciation expense was $395,000 and $255,000 for the quarters ended September 30, 2013 and 2012, respectively. Depreciation expense was $1,059,000 and $895,000 for the nine months ended September 30, 2013 and 2012, respectively. | ||||||||
StockBased_Compensation
Stock-Based Compensation | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Stock-Based Compensation | ' | |||
Stock-Based Compensation | ' | |||
4. Stock-Based Compensation | ||||
Stock Incentive Plans | ||||
The Company’s Stock Incentive Plans provide for the granting of stock awards, including restricted stock, stock options, and stock appreciation rights, to employees and non-employees, including directors of the Company. | ||||
Restricted Stock | ||||
For the nine months ended September 30, 2013, 175,213 shares of unvested restricted stock were awarded at a market value of $7.03. Of the restricted shares granted, 58,909 shares have performance based vesting conditions. The value of the shares is amortized to compensation expense over the related service period, which is normally three years, or over the estimated performance period. Shares of unvested 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 for the nine months ended September 30, 2013: | ||||
Number of | ||||
Shares | ||||
Outstanding at beginning of period | 243,124 | |||
Granted | 175,213 | |||
Forfeited | (3,181 | ) | ||
Vested | (143,266 | ) | ||
Outstanding at end of Period | 271,890 | |||
For the quarters ended September 30, 2013 and 2012, stock compensation expense, net of forfeitures, of $172,000 and $160,000 was recorded, respectively. For the nine-months ended September 30, 2013 and 2012, stock compensation expense, net of forfeitures, of $674,000 and $446,000 was recorded, respectively. | ||||
On October 18, 2013, an additional 248,305 shares were awarded at a market value of $8.23, to certain executives of the Company as a result of the acquisition of Globe Motors, Inc. The stock compensation expense will occur over the service period of 5 years, and will begin to be recognized in the fourth quarter of 2013. See Note 11. Subsequent Events, for additional details surrounding the acquisition. | ||||
Dividends_per_Share
Dividends per Share | 9 Months Ended |
Sep. 30, 2013 | |
Dividends per Share | ' |
Dividends per Share | ' |
5. Dividends per Share | |
The Company declared and paid a quarterly dividend of $0.025 per share in each of the first three quarters of 2013 and 2012. Total dividends paid in the first nine months of 2013 and 2012 were $646,000 and $629,000, respectively. | |
Segment_Information
Segment Information | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Segment Information | ' | |||||||||||||
Segment Information | ' | |||||||||||||
6. 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 condensed consolidated financial statements and within this note. | ||||||||||||||
The Company’s wholly owned foreign subsidiaries, located in The Netherlands, Sweden, Canada, and Asia are included in the accompanying condensed consolidated financial statements. Financial information related to the foreign subsidiaries is summarized below (in thousands): | ||||||||||||||
For the three | For the nine | |||||||||||||
months ended | months ended | |||||||||||||
September 30, | September 30, | |||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||
Revenues derived from foreign subsidiaries | $ | 11,167 | $ | 9,771 | $ | 33,934 | $ | 32,085 | ||||||
Identifiable assets as of September 30, | $ | 31,480 | $ | 25,335 | ||||||||||
Sales to customers outside of the United States by all subsidiaries were $11,491,000 and $10,172,000 during the quarters ended September 30, 2013 and 2012, respectively, and $35,504,000 and $33,905,000 for the nine months ended September 30, 2013 and 2012, respectively. | ||||||||||||||
During the quarters and nine months ended September 30, 2013 and 2012, no single customer accounted for more than 10% of total revenues. | ||||||||||||||
Intangible_Assets
Intangible Assets | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
Intangible Assets | ' | |||||||||
Intangible Assets | ' | |||||||||
7. Intangible Assets | ||||||||||
Intangible assets on the Company’s condensed consolidated balance sheets consist of the following (in thousands): | ||||||||||
September 30, | December 31, | Estimated | ||||||||
2013 | 2012 | Life | ||||||||
Amortizable intangible assets | ||||||||||
Customer lists | $ | 4,421 | $ | 4,364 | 8-10 years | |||||
Trade name | 946 | 946 | 10 years | |||||||
Design and technologies | 2,684 | 2,626 | 8-10 years | |||||||
Patents | 24 | 24 | ||||||||
Accumulated amortization | (5,848 | ) | (5,529 | ) | ||||||
Total intangible assets | $ | 2,227 | $ | 2,431 | ||||||
Amortization expense for intangible assets was $83,000 and $126,000 for the quarters ended September 30, 2013 and 2012, respectively, and $252,000 and $466,000 for the nine months ended September 30, 2013 and 2012, respectively. | ||||||||||
Goodwill
Goodwill | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Goodwill | ' | ||||
Goodwill | ' | ||||
8. Goodwill | |||||
The change in the Company’s goodwill during the nine months ended September 30, 2013 is summarized in the table below (in thousands): | |||||
Balance, December 31, 2012 | $ | 5,782 | |||
Foreign currency translation | 134 | ||||
Balance, September 30, 2013 | $ | 5,916 | |||
Debt_Obligations
Debt Obligations | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Debt Obligations | ' | |||||||
Debt Obligations | ' | |||||||
9. Debt Obligations | ||||||||
Debt obligations consisted of the following (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Credit Agreement, revolving line-of-credit | $ | — | $ | — | ||||
China Credit Facility, 6.2% at September 30, 2013 | $ | 1,141 | $ | 397 | ||||
The Company’s Prior Credit Agreement, was scheduled to mature on October 26, 2014, provided revolving credit up to $4 million and €3 million. At September 30, 2013, approximately $8,100,000 ($4,000,000 and € 3,000,000) was available under the Prior Credit Agreement. As a result of the acquisition of Globe Motors, Inc., the Company entered into a new Credit Agreement, thus terminating the Prior Credit Agreement. See further discussion in Note 11. Subsequent Events. | ||||||||
The Prior Credit Agreement contained certain financial covenants related to maximum leverage, minimum fixed charge coverage and minimum tangible net worth of the Company. The Company was in compliance with all covenants at September 30, 2013. | ||||||||
Approximately $700,000 (€ 300,000 and 2,100,000 Swedish Krona (“SEK”)) was available under bank overdraft facilities in Europe. | ||||||||
The Company also has a Credit Facility in China providing credit of approximately $1,600,000 (Chinese Renminbi (“RMB”) 9,500,000). This facility is used for working capital and capital equipment needs at the Company’s China operations, and will mature in October 2014. At September 30, 2013, there was approximately $400,000 (RMB 2,500,000) available under the facility. | ||||||||
Business_development_costs
Business development costs | 9 Months Ended |
Sep. 30, 2013 | |
Business development costs | ' |
Business development costs | ' |
10. Business development costs | |
The Company incurred approximately $596,000 of business development costs in the quarter ended September 30, 2013 and $1,235,000 for the nine months ended September 30, 2013 in conjunction with the acquisition of Globe Motors, Inc. (“Globe”). | |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events | ' |
Subsequent Events | ' |
11. Subsequent Events | |
On Friday, October 18, 2013, the Company completed the acquisition of Globe from Safran USA, Inc., on a cash free, debt free basis, for approximately $90 million in cash. | |
The initial accounting for the business transaction is incomplete pending the determination of the fair value of the assets acquired and the liabilities assumed, pre-acquisition tax positions and the contractual working capital adjustment defined in the purchase agreement. The valuation is expected to be finalized in the fourth quarter of 2013. When the valuation is finalized, the excess of the purchase price over the fair value of the tangible and identifiable intangible assets acquired and the liabilities assumed will be allocated to goodwill. | |
In connection with the funding of the acquisition of Globe, the Company entered into a Credit Agreement dated as of October 18, 2013. The Credit Agreement provides for a $15 million five-year revolving credit facility and a $50 million 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 will 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”). In addition, the Company is required to pay a commitment fee of between 0.125% and 0.30% quarterly (currently 0.25%) on the unused portion of the Revolver, also based on the Company’s 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 and with mandatory prepayments being required in certain circumstances. The Senior Credit Facilities are secured by substantially all of the Company’s assets and are fully and unconditionally guaranteed by certain of the Company’s subsidiaries. | |
Financial covenants defined in the Credit Agreement require the Company to maintain a minimum fixed charge coverage ratio of at least 1.25:1.0 at the end of each fiscal quarter. In addition, the Company’s Total Leverage Ratio at the end of any fiscal quarter shall not be greater than 4.0:1.0 through September 30, 2014, 3.0:1.0 through September 30, 2015, 2.5:1.0 through September 30, 2016 and 2.25:1.0 thereafter. The Credit Agreement also includes other covenants and restrictions, including limits on the amount of certain types of capital expenditures. These covenants are subject to certain exceptions provided in the Credit Agreement. | |
The Credit Agreement requires the Company to enter into derivative contracts for at least 50% of the balance of the Term Loan, as amortized. The Company has entered into these derivative contracts during October, and will be using Hedge Accounting with gains and losses on contracts being reflected in Other Comprehensive Income. | |
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 million 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. | |
The Note Agreement contains customary covenants that are substantially similar to the covenants in the Credit Agreement, however the financial covenants under the Note Agreement require the Company to maintain a minimum fixed charge coverage ratio of at least 1.05:1.0 at the end of each fiscal quarter and the Company’s Total Leverage Ratio at the end of any fiscal quarter shall not be greater than 4.5:1.0 through September 30, 2014, 3.5:1.0 through September 30, 2015, 3.0:1.0 through September 30, 2016 and 2.75:1.0 thereafter. | |
The Note Agreement also includes customary events of default that are substantially similar to the events of default in the Credit Agreement. The amounts outstanding under the Notes may be accelerated upon certain events of default. A Yield Maintenance Amount may also be due if the acceleration of the principal amount due to an event of default occurs prior to October 18, 2016. The Yield Maintenance Amount is equal to the excess, if any, of the discounted value of the called principal with respect to the Notes over the sum of the called principal plus accrued interest as of the settlement date. | |
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 million and €3 million. No amounts were outstanding under the Prior Credit Agreement at the time of termination. | |
Inventories_Tables
Inventories (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Inventories | ' | |||||||
Schedule of inventories, valued at the lower of cost (first-in, first-out basis) or market | ' | |||||||
Inventories, valued at the lower of cost (first-in, first-out basis) or market, are as follows (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Parts and raw materials | $ | 12,345 | $ | 13,174 | ||||
Work-in process | 1,781 | 1,504 | ||||||
Finished goods | 3,062 | 2,096 | ||||||
17,188 | 16,774 | |||||||
Less reserves | (2,021 | ) | (2,073 | ) | ||||
Inventories, net | $ | 15,167 | $ | 14,701 |
Property_Plant_and_Equipment_T
Property, Plant and Equipment (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Property, Plant and Equipment | ' | |||||||
Schedule of classification of property, plant and equipment | ' | |||||||
Property, plant and equipment is classified as follows (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Land | $ | 290 | $ | 290 | ||||
Building and improvements | 3,961 | 3,713 | ||||||
Machinery, equipment, tools and dies | 15,183 | 13,483 | ||||||
Furniture, fixtures and other | 4,159 | 3,996 | ||||||
23,593 | 21,482 | |||||||
Less accumulated depreciation | (13,944 | ) | (12,851 | ) | ||||
Property, Plant and Equipment, net | $ | 9,649 | $ | 8,631 |
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Stock-Based Compensation | ' | |||
Summary of restricted stock activity | ' | |||
Number of | ||||
Shares | ||||
Outstanding at beginning of period | 243,124 | |||
Granted | 175,213 | |||
Forfeited | (3,181 | ) | ||
Vested | (143,266 | ) | ||
Outstanding at end of Period | 271,890 |
Segment_Information_Tables
Segment Information (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 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 three | For the nine | |||||||||||||
months ended | months ended | |||||||||||||
September 30, | September 30, | |||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||
Revenues derived from foreign subsidiaries | $ | 11,167 | $ | 9,771 | $ | 33,934 | $ | 32,085 | ||||||
Identifiable assets as of September 30, | $ | 31,480 | $ | 25,335 | ||||||||||
Intangible_Assets_Tables
Intangible Assets (Tables) | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
Intangible Assets | ' | |||||||||
Schedule of intangible assets | ' | |||||||||
Intangible assets on the Company’s condensed consolidated balance sheets consist of the following (in thousands): | ||||||||||
September 30, | December 31, | Estimated | ||||||||
2013 | 2012 | Life | ||||||||
Amortizable intangible assets | ||||||||||
Customer lists | $ | 4,421 | $ | 4,364 | 8-10 years | |||||
Trade name | 946 | 946 | 10 years | |||||||
Design and technologies | 2,684 | 2,626 | 8-10 years | |||||||
Patents | 24 | 24 | ||||||||
Accumulated amortization | (5,848 | ) | (5,529 | ) | ||||||
Total intangible assets | $ | 2,227 | $ | 2,431 |
Goodwill_Tables
Goodwill (Tables) | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Goodwill | ' | ||||
Schedule of change in goodwill | ' | ||||
The change in the Company’s goodwill during the nine months ended September 30, 2013 is summarized in the table below (in thousands): | |||||
Balance, December 31, 2012 | $ | 5,782 | |||
Foreign currency translation | 134 | ||||
Balance, September 30, 2013 | $ | 5,916 |
Debt_Obligations_Tables
Debt Obligations (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Debt Obligations | ' | |||||||
Schedule of debt obligations | ' | |||||||
Debt obligations consisted of the following (in thousands): | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Credit Agreement, revolving line-of-credit | $ | — | $ | — | ||||
China Credit Facility, 6.2% at September 30, 2013 | $ | 1,141 | $ | 397 |
Inventories_Details
Inventories (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Inventories | ' | ' |
Parts and raw materials | $12,345 | $13,174 |
Work-in-process | 1,781 | 1,504 |
Finished goods | 3,062 | 2,096 |
Inventory, gross | 17,188 | 16,774 |
Less reserves | -2,021 | -2,073 |
Inventories, net | $15,167 | $14,701 |
Property_Plant_and_Equipment_D
Property, Plant and Equipment (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Property, plant and equipment | ' | ' | ' | ' | ' |
Property, plant and equipment, gross | $23,593,000 | ' | $23,593,000 | ' | $21,482,000 |
Less accumulated depreciation | -13,944,000 | ' | -13,944,000 | ' | -12,851,000 |
Property, plant and equipment, net | 9,649,000 | ' | 9,649,000 | ' | 8,631,000 |
Depreciation expense | 395,000 | 255,000 | 1,059,000 | 895,000 | ' |
Land | ' | ' | ' | ' | ' |
Property, plant and equipment | ' | ' | ' | ' | ' |
Property, plant and equipment, gross | 290,000 | ' | 290,000 | ' | 290,000 |
Building and improvements | ' | ' | ' | ' | ' |
Property, plant and equipment | ' | ' | ' | ' | ' |
Property, plant and equipment, gross | 3,961,000 | ' | 3,961,000 | ' | 3,713,000 |
Machinery, equipment, tools and dies | ' | ' | ' | ' | ' |
Property, plant and equipment | ' | ' | ' | ' | ' |
Property, plant and equipment, gross | 15,183,000 | ' | 15,183,000 | ' | 13,483,000 |
Furniture, fixtures and other | ' | ' | ' | ' | ' |
Property, plant and equipment | ' | ' | ' | ' | ' |
Property, plant and equipment, gross | $4,159,000 | ' | $4,159,000 | ' | $3,996,000 |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 9 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Oct. 18, 2013 | Sep. 30, 2013 | |
Restricted Stock | Restricted Stock | Restricted Stock | Restricted Stock | Restricted Stock | Restricted Stock With Performance Conditions | |||
Subsequent event | ||||||||
Number of Shares | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at beginning of period (in shares) | ' | ' | ' | ' | 243,124 | ' | ' | ' |
Granted (in shares) | ' | ' | ' | ' | 175,213 | ' | 248,305 | 58,909 |
Forfeited (in shares) | ' | ' | ' | ' | -3,181 | ' | ' | ' |
Vested (in shares) | ' | ' | ' | ' | -143,266 | ' | ' | ' |
Outstanding at end of period (in shares) | ' | ' | 271,890 | ' | 271,890 | ' | ' | ' |
Additional disclosures | ' | ' | ' | ' | ' | ' | ' | ' |
Compensation expense, net of forfeitures | $674,000 | $446,000 | $172,000 | $160,000 | $674,000 | $446,000 | ' | ' |
Market value (in dollars per share) | ' | ' | ' | ' | $7.03 | ' | $8.23 | ' |
Service period over which value of the shares is amortized to compensation expense | ' | ' | ' | ' | ' | ' | '5 years | '3 years |
Dividends_per_Share_Details
Dividends per Share (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Dividends per Share | ' | ' | ' | ' | ' | ' | ' | ' |
Dividend paid (in dollars per share) | $0.03 | $0.03 | $0.03 | $0.03 | $0.03 | $0.03 | ' | ' |
Total dividends paid | ' | ' | ' | ' | ' | ' | $646 | $629 |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
segment | |||||
Segment Information | ' | ' | ' | ' | ' |
Number of operating segments | ' | ' | 1 | ' | ' |
Segment information | ' | ' | ' | ' | ' |
Revenues derived from foreign subsidiaries | $24,876,000 | $24,316,000 | $75,371,000 | $77,999,000 | ' |
Identifiable assets | 66,991,000 | ' | 66,991,000 | ' | 60,967,000 |
Wholly owned foreign subsidiaries | ' | ' | ' | ' | ' |
Segment information | ' | ' | ' | ' | ' |
Revenues derived from foreign subsidiaries | 11,167,000 | 9,771,000 | 33,934,000 | 32,085,000 | ' |
Identifiable assets | 31,480,000 | 25,335,000 | 31,480,000 | 25,335,000 | ' |
All subsidiaries | ' | ' | ' | ' | ' |
Segment information | ' | ' | ' | ' | ' |
Sales to customers outside of the United States | $11,491,000 | $10,172,000 | $35,504,000 | $33,905,000 | ' |
Intangible_Assets_Details
Intangible Assets (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Intangible assets subject to amortization | ' | ' | ' | ' | ' |
Accumulated amortization | ($5,848) | ' | ($5,848) | ' | ($5,529) |
Total intangible assets | 2,227 | ' | 2,227 | ' | 2,431 |
Amortization expense for intangible assets | 83 | 126 | 252 | 466 | ' |
Customer lists | ' | ' | ' | ' | ' |
Intangible assets subject to amortization | ' | ' | ' | ' | ' |
Gross Amount | 4,421 | ' | 4,421 | ' | 4,364 |
Customer lists | Minimum | ' | ' | ' | ' | ' |
Intangible assets subject to amortization | ' | ' | ' | ' | ' |
Estimated Life | ' | ' | '8 years | ' | ' |
Customer lists | Maximum | ' | ' | ' | ' | ' |
Intangible assets subject to amortization | ' | ' | ' | ' | ' |
Estimated Life | ' | ' | '10 years | ' | ' |
Trade name | ' | ' | ' | ' | ' |
Intangible assets subject to amortization | ' | ' | ' | ' | ' |
Gross Amount | 946 | ' | 946 | ' | 946 |
Estimated Life | ' | ' | '10 years | ' | ' |
Design and technologies | ' | ' | ' | ' | ' |
Intangible assets subject to amortization | ' | ' | ' | ' | ' |
Gross Amount | 2,684 | ' | 2,684 | ' | 2,626 |
Design and technologies | Minimum | ' | ' | ' | ' | ' |
Intangible assets subject to amortization | ' | ' | ' | ' | ' |
Estimated Life | ' | ' | '8 years | ' | ' |
Design and technologies | Maximum | ' | ' | ' | ' | ' |
Intangible assets subject to amortization | ' | ' | ' | ' | ' |
Estimated Life | ' | ' | '10 years | ' | ' |
Patents | ' | ' | ' | ' | ' |
Intangible assets subject to amortization | ' | ' | ' | ' | ' |
Gross Amount | $24 | ' | $24 | ' | $24 |
Goodwill_Details
Goodwill (Details) (USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Change in goodwill | ' |
Balance at the beginning of the period | $5,782 |
Foreign currency translation | 134 |
Balance at the end of the period | $5,916 |
Debt_Obligations_Details
Debt Obligations (Details) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
USD ($) | USD ($) | Prior Credit Agreement, revolving line-of-credit | Prior Credit Agreement, revolving line-of-credit | Prior Credit Agreement, revolving line-of-credit | China Credit Facility | China Credit Facility | China Credit Facility | Bank overdraft facilities in Europe | Bank overdraft facilities in Europe | Bank overdraft facilities in Europe | |
USD ($) | USD | Euro | USD ($) | USD ($) | Chinese Renminbi ("RMB") | USD ($) | Euro | Swedish Krona (''SEK'') | |||
USD ($) | EUR (€) | CNY | EUR (€) | SEK | |||||||
Debt Obligations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total Debt | $1,141,000 | $397,000 | ' | ' | ' | $1,141,000 | $397,000 | ' | ' | ' | ' |
Interest rate at period end (as a percent) | ' | ' | ' | ' | ' | 6.20% | 6.20% | ' | ' | ' | ' |
Maximum borrowing capacity | ' | ' | ' | 4,000,000 | 3,000,000 | 1,600,000 | ' | 9,500,000 | ' | ' | ' |
Remaining borrowing capacity available | ' | ' | $8,100,000 | $4,000,000 | € 3,000,000 | $400,000 | ' | 2,500,000 | $700,000 | € 300,000 | 2,100,000 |
Business_development_costs_Det
Business development costs (Details) (USD $) | 3 Months Ended | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 |
Business development costs | ' | ' |
Business development costs | $596 | $1,235 |
Subsequent_Events_Details
Subsequent Events (Details) | Sep. 30, 2013 | Sep. 30, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 | Oct. 18, 2013 |
Prior Credit Agreement, revolving line-of-credit | Prior Credit Agreement, revolving line-of-credit | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | |
USD | Euro | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Senior Credit Facilities | Notes | Notes | Notes | Notes | Notes | Prior Credit Agreement, revolving line-of-credit | Globe | Globe | Globe | Globe | |
USD ($) | EUR (€) | Minimum | Maximum | Maximum | Maximum | Maximum | Maximum | Base Rate | Base Rate | Base Rate | Eurocurrency Rate | Eurocurrency Rate | Minimum | Maximum | Maximum | Maximum | Maximum | USD ($) | USD ($) | New Credit Agreement, revolving line-of-credit | Term loan | Notes | ||
Total leverage ratio through September 30, 2014 | Total leverage ratio through September 30, 2015 | Total leverage ratio through September 30, 2016 | Total leverage ratio thereafter | Minimum | Maximum | Minimum | Maximum | Total leverage ratio through September 30, 2014 | Total leverage ratio through September 30, 2015 | Total leverage ratio through September 30, 2016 | Total leverage ratio thereafter | USD ($) | USD ($) | USD ($) | ||||||||||
Subsequent event | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash consideration paid | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $90,000,000 | ' | ' | ' |
Maximum borrowing capacity | 4,000,000 | 3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15,000,000 | ' | ' |
Debt instrument term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | '5 years | ' |
Principal amount of debt borrowed | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000,000 | 30,000,000 |
Variable base 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% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Commitment fee on unused portion of the Revolver (as a percent) | ' | ' | 0.25% | 0.13% | 0.30% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fixed charge coverage ratio to be maintained at the end of each fiscal quarter | ' | ' | ' | 1.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.05 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total leverage ratio to be maintained at the end of each fiscal quarter | ' | ' | ' | ' | ' | 4 | 3 | 2.5 | 2.25 | ' | ' | ' | ' | ' | ' | 4.5 | 3.5 | 3 | 2.75 | ' | ' | ' | ' | ' |
Derivative contracts required to enter into, expressed as a percentage of the balance of the Term Loan | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
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% |
Percentage of principal amount of notes that may prepay | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% |
Remaining borrowing capacity available | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | ' | ' | ' | ' |