Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Dec. 31, 2013 | Jan. 31, 2014 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'KENNAMETAL INC | ' |
Entity Central Index Key | '0000055242 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Dec-13 | ' |
Amendment Flag | 'false | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
Current Fiscal Year End Date | '--06-30 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 78,600,322 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Income (Unaudited) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Statement [Abstract] | ' | ' | ' | ' |
Sales | $689,936 | $633,144 | $1,309,743 | $1,262,603 |
Cost of goods sold | 482,965 | 433,697 | 904,536 | 854,808 |
Gross profit | 206,971 | 199,447 | 405,207 | 407,795 |
Operating expense | 148,421 | 127,778 | 282,685 | 266,638 |
Restructuring Charges | 2,310 | 0 | 2,310 | 0 |
Amortization of intangibles | 6,524 | 5,200 | 11,667 | 10,307 |
Operating income | 49,716 | 66,469 | 108,545 | 130,850 |
Interest expense | 8,037 | 6,970 | 15,118 | 12,926 |
Other expense (income), net | 856 | 655 | 1,466 | -246 |
Income before income taxes | 40,823 | 58,844 | 91,961 | 118,170 |
Provision for income taxes | 16,656 | 15,535 | 29,236 | 27,815 |
Net income | 24,167 | 43,309 | 62,725 | 90,355 |
Less: Net (loss) income attributable to noncontrolling interests | -42 | 1,167 | 679 | 1,823 |
Net income attributable to Kennametal | $24,209 | $42,142 | $62,046 | $88,532 |
PER SHARE DATA ATTRIBUTABLE TO KENNAMETAL SHAREOWNERS | ' | ' | ' | ' |
Basic earning per share | $0.31 | $0.53 | $0.79 | $1.11 |
Diluted earning per share | $0.30 | $0.52 | $0.78 | $1.09 |
Dividends per share | $0.18 | $0.16 | $0.36 | $0.32 |
Basic weighted average shares outstanding | 78,729 | 79,713 | 78,587 | 79,980 |
Diluted weighted average shares outstanding | 79,776 | 80,986 | 79,597 | 81,164 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Comprehensive Income [Abstract] | ' | ' | ' | ' |
Net income | $24,167 | $43,309 | $62,725 | $90,355 |
Unrealized loss on derivatives designated and qualified as cash flow hedges, net of income tax benefit of $0.2 million, $0.1 million, $0.5 million and $0.4 million, respectively | -273 | -102 | -843 | -673 |
Reclassification of unrealized loss on expired derivatives designated and qualified as cash flow hedges, net of income tax benefit of $0.3 million, $0.2 million, $0.5 million and $0.2 million, respectively | 440 | 293 | 849 | 378 |
Unrecognized net pension and other postretirement benefit loss, net of income tax benefit of $0.3 million, $0.2 million, $1.0 million and $0.5 million, respectively | -810 | -362 | -2,776 | -1,480 |
Reclassification of net pension and other postretirement benefit loss, net of income tax benefit of $0.2 million, $1.4 million, $0.4 million and $2.8 million, respectively | 498 | 2,421 | 982 | 4,835 |
Foreign currency translation adjustments, net of income tax expense of $0.7 million, $0.4 million, $2.1 million and $1.5 million, respectively | 11,675 | 13,367 | 39,586 | 38,445 |
Total comprehensive income | 35,697 | 58,926 | 100,523 | 131,860 |
Comprehensive income attributable to noncontrolling interests | 371 | 1,223 | 906 | 2,509 |
Comprehensive income attributable to Kennametal Shareowners | $35,326 | $57,703 | $99,617 | $129,351 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Comprehensive Income (Unaudited) Condensed Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Comprehensive Income [Abstract] | ' | ' | ' | ' |
Unrealized loss on derivatives designated and qualified as cash flow hedges, Tax benefit | $0.20 | $0.10 | $0.50 | $0.40 |
Reclassification of unrealized loss on expired derivatives designated and qualified as cash flow hedges, Tax benefit | 0.3 | 0.2 | 0.5 | 0.2 |
Unrecognized net pension and other postretirement benefit loss, Tax benefit | 0.3 | 0.1 | 1 | 0.5 |
Reclassification of net pension and other postretirement benefit loss, Tax benefit | 0.2 | 1.4 | 0.4 | 2.8 |
Foreign currency translation adjustments, Tax expense | $0.70 | $0.40 | $2.10 | $1.50 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (Unaudited) (USD $) | Dec. 31, 2013 | Jun. 30, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $163,289 | $377,316 |
Accounts receivable, less allowance for doubtful accounts of $13,320 and $11,949 | 467,759 | 445,322 |
Inventories (Note 11) | 730,678 | 578,795 |
Deferred income taxes | 51,753 | 49,707 |
Other current assets | 65,359 | 48,333 |
Total current assets | 1,478,838 | 1,499,473 |
Property, plant and equipment: | ' | ' |
Land and buildings | 440,224 | 381,215 |
Machinery and equipment | 1,603,440 | 1,466,942 |
Less accumulated depreciation | -1,169,286 | -1,106,675 |
Property, plant and equipment, net | 874,378 | 741,482 |
Other assets: | ' | ' |
Investments in affiliated companies | 659 | 671 |
Goodwill (Note 18) | 977,644 | 721,755 |
Other intangible assets, less accumulated amortization of $125,176 and $111,440 (Note 18) | 355,581 | 222,765 |
Deferred income taxes | 33,582 | 39,590 |
Other | 87,518 | 75,303 |
Total other assets | 1,454,984 | 1,060,084 |
Total assets | 3,808,200 | 3,301,039 |
Current liabilities: | ' | ' |
Current maturities of long-term debt and capital leases (Note 12) | 28,281 | 3,738 |
Notes payable to banks | 81,815 | 40,581 |
Accounts payable | 188,614 | 190,623 |
Accrued income taxes | 15,943 | 19,471 |
Accrued expenses | 85,835 | 88,433 |
Other current liabilities | 138,821 | 124,747 |
Total current liabilities | 539,309 | 467,593 |
Long-term debt and capital leases, less current maturities (Note 12) | 1,035,633 | 703,626 |
Deferred income taxes | 102,574 | 102,935 |
Accrued pension and postretirement benefits | 169,751 | 162,245 |
Accrued income taxes | 19,094 | 27,530 |
Other liabilities | 38,535 | 24,817 |
Total liabilities | 1,904,896 | 1,488,746 |
Commitments and contingencies | ' | ' |
Kennametal Shareowners' Equity: | ' | ' |
Preferred stock, no par value; 5,000 shares authorized; none issued | ' | ' |
Capital stock, $1.25 par value; 120,000 shares authorized; 78,587 and 77,842 shares issued | 98,234 | 97,303 |
Additional paid-in capital | 392,103 | 374,300 |
Retained earnings | 1,433,093 | 1,399,227 |
Accumulated other comprehensive loss | -51,433 | -89,004 |
Total Kennametal Shareowners' Equity | 1,871,997 | 1,781,826 |
Noncontrolling interests | 31,307 | 30,467 |
Total equity | 1,903,304 | 1,812,293 |
Total liabilities and equity | $3,808,200 | $3,301,039 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | Dec. 31, 2013 | Jun. 30, 2013 |
In Thousands, except Per Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Allowance for doubtful accounts | $13,320 | $11,949 |
Accumulated amortization on other intangible assets | $125,176 | $111,440 |
Preferred stock, par value | $0 | $0 |
Preferred stock, shares authorized | 5,000 | 5,000 |
Preferred stock, shares issued | 0 | 0 |
Capital stock, par value | $1.25 | $1.25 |
Capital stock, shares authorized | 120,000 | 120,000 |
Capital stock, shares issued | 78,587 | 77,842 |
Condensed_Consolidated_Stateme3
Condensed Consolidated Statements of Cash Flow (Unaudited) (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
OPERATING ACTIVITIES | ' | ' |
Net income | $62,725 | $90,355 |
Adjustments for non-cash items: | ' | ' |
Depreciation | 48,267 | 45,460 |
Amortization | 11,667 | 10,307 |
Stock-based compensation expense | 12,108 | 15,450 |
Deferred income tax provision | 13,116 | 2,389 |
Other | 1,587 | 174 |
Changes in certain assets and liabilities: | ' | ' |
Accounts receivable | 26,942 | 73,898 |
Inventories | -27,044 | -22,941 |
Accounts payable and accrued liabilities | -34,322 | -135,823 |
Accrued income taxes | -13,997 | -21,114 |
Other | -16,432 | -3,920 |
Net cash flow provided by operating activities | 84,617 | 54,235 |
INVESTING ACTIVITIES | ' | ' |
Purchases of property, plant and equipment | -48,804 | -34,372 |
Disposals of property, plant and equipment | 444 | 704 |
Business acquisition, net of cash acquired (Note 5) | -634,615 | 0 |
Other | -60 | -87 |
Net cash flow used for investing activities | -683,035 | -33,755 |
FINANCING ACTIVITIES | ' | ' |
Net increase (decrease) in notes payable | 40,910 | -39,168 |
Net increase (decrease) in short term revolving and other lines of credit | 14,900 | -27,200 |
Term debt borrowings | 345,485 | 864,244 |
Term debt repayments | -5,000 | -655,915 |
Purchase of capital stock | -4,400 | -46,616 |
Dividend reinvestment and the effect of employee benefit and stock plans | 18,072 | 6,085 |
Cash dividends paid to shareowners | -28,180 | -25,748 |
Other | 250 | -2,659 |
Net cash flow provided by financing activities | 382,037 | 73,023 |
CASH AND CASH EQUIVALENTS | ' | ' |
Net (decrease) increase in cash and cash equivalents | -214,027 | 100,305 |
Effect of exchange rate changes on cash and cash equivalents | 2,354 | 6,802 |
Cash and cash equivalents, beginning of period | 377,316 | 116,466 |
Cash and cash equivalents, end of period | $163,289 | $216,771 |
Organization
Organization | 6 Months Ended |
Dec. 31, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
ORGANIZATION | ' |
ORGANIZATION | |
From its founding in 1938, the McKenna family incorporated Kennametal Inc. in Pennsylvania in 1943. Kennametal Inc. and its subsidiaries (collectively, Kennametal or the Company) are a leading global manufacturer and supplier of tooling, engineered components and advanced materials consumed in production processes. We believe that our reputation for manufacturing excellence, as well as our technological expertise and innovation we deliver in our products and services, helps us to achieve a leading position in our primary markets. End users of our products include metalworking and machinery manufacturers and suppliers across a diverse array of industries, including the aerospace, defense, transportation, machine tool, light machinery and heavy machinery, as well as producers and suppliers in a number of equipment-intensive industries such as coal mining, road construction and quarrying, as well as oil and gas exploration, refining, production and supply. Our end users' applications range from airframes to mining operations, engines to oil wells and turbochargers to processing. We operate two global business segments consisting of Industrial and Infrastructure. |
Basis_of_Presentation
Basis of Presentation | 6 Months Ended |
Dec. 31, 2013 | |
Accounting Policies [Abstract] | ' |
BASIS OF PRESENTATION | ' |
BASIS OF PRESENTATION | |
The condensed consolidated financial statements, which include our accounts and those of our majority-owned subsidiaries, should be read in conjunction with our 2013 Annual Report on Form 10-K. The condensed consolidated balance sheet as of June 30, 2013 was derived from the audited balance sheet included in our 2013 Annual Report on Form 10-K. These interim statements are unaudited; however, we believe that all adjustments necessary for a fair statement of the results of the interim periods were made and all adjustments are normal adjustments. The results for the six months ended December 31, 2013 and 2012 are not necessarily indicative of the results to be expected for a full fiscal year. Unless otherwise specified, any reference to a “year” is to a fiscal year ended June 30. For example, a reference to 2014 is to the fiscal year ending June 30, 2014. When used in this Quarterly Report on Form 10-Q, unless the context requires otherwise, the terms “we,” “our” and “us” refer to Kennametal Inc. and its subsidiaries. |
New_Accounting_Standards
New Accounting Standards | 6 Months Ended |
Dec. 31, 2013 | |
Accounting Changes and Error Corrections [Abstract] | ' |
NEW ACCOUNTING STANDARDS | ' |
NEW ACCOUNTING STANDARDS | |
Adopted | |
As of July 1, 2013, Kennametal adopted disclosure requirements related to reclassifications out of accumulated other comprehensive income by component. See Note 17 to these condensed consolidated financial statements for required disclosures. Other than the change in disclosures, the adoption of this guidance had no impact on the condensed consolidated financial statements. | |
As of July 1, 2013, Kennametal adopted additional guidance on testing indefinite lived intangible assets for impairment. The guidance permits an entity to first assess qualitative factors to determine whether it is more likely than not that the fair value of an indefinite lived intangible asset is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step impairment test. The adoption of this guidance had no impact on the condensed consolidated financial statements. |
Supplemental_Cash_Flow_Disclos
Supplemental Cash Flow Disclosures | 6 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Supplemental Cash Flow Elements [Abstract] | ' | |||||||
SUPPLEMENTAL CASH FLOW DISCLOSURES | ' | |||||||
SUPPLEMENTAL CASH FLOW DISCLOSURES | ||||||||
Six Months Ended | ||||||||
December 31, | ||||||||
(in thousands) | 2013 | 2012 | ||||||
Cash paid during the period for: | ||||||||
Interest | $ | 14,231 | $ | 11,338 | ||||
Income taxes | 24,868 | 45,072 | ||||||
Supplemental disclosure of non-cash information: | ||||||||
Changes in accounts payable related to purchases of property, plant and equipment | 8,600 | — | ||||||
Acquisition
Acquisition | 6 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Business Combinations [Abstract] | ' | ||||||||||||
ACQUISITION | ' | ||||||||||||
ACQUISITIONS | |||||||||||||
TMB | |||||||||||||
On November 4, 2013, the Company completed its transaction to acquire the Tungsten Materials Business (TMB) from Allegheny Technologies Incorporated (ATI) which included all of the assets of TDY Industries, LLC, a wholly owned subsidiary of ATI, used or held for use by TDY in connection with the business; and all of the shares of TDY Limited and ATI Holdings SAS, both wholly-owned subsidiaries of ATI, for a purchase price of $607.0 million. We funded the acquisition primarily through a combination of cash from operations and available borrowings under our existing credit facility. | |||||||||||||
TMB, with approximately $340.0 million in annual sales, is a leading producer of tungsten metallurgical powders, as well as tooling technologies and components. The business has approximately 1,175 employees in 12 locations across 7 countries. The acquisition aligns with Company's long-term growth strategies, expands presence in aerospace and energy end markets, further augments the Company's tooling portfolio and accelerates our metallurgical strategy including planned tungsten carbide recycling and production. | |||||||||||||
As part of the acquisition of TMB, Kennametal incurred $1.7 million and $2.8 million for the three and six months ended December 31, 2013 of acquisition-related costs, which are included in operating expenses. | |||||||||||||
Purchase Price Allocation | |||||||||||||
This acquisition was accounted for under the acquisition method of accounting and accordingly, the purchase price has been allocated to the assets acquired and liabilities assumed based on estimated fair values at the date of acquisition. The Condensed Consolidated Balance Sheet as of December 31, 2013 reflects the preliminary allocation of the purchase price and is subject to revision when appraisals are finalized, which is expected to be in the fourth quarter of fiscal 2014. | |||||||||||||
The preliminary allocation of the purchase price to the fair values of the assets acquired and liabilities assumed is as follows: | |||||||||||||
(in thousands) | Total | ||||||||||||
ASSETS | |||||||||||||
Current assets: | |||||||||||||
Cash and cash equivalents | $ | 1,294 | |||||||||||
Accounts Receivable | 41,164 | ||||||||||||
Inventory | 98,664 | ||||||||||||
Other current assets | 4,014 | ||||||||||||
Total current assets | $ | 145,136 | |||||||||||
Property and equipment | 125,283 | ||||||||||||
Goodwill | 242,363 | ||||||||||||
Other intangible assets | 124,200 | ||||||||||||
Deferred income taxes | 3,699 | ||||||||||||
Other | 1,565 | ||||||||||||
Total assets | $ | 642,246 | |||||||||||
LIABILITIES | |||||||||||||
Current liabilities: | |||||||||||||
Accounts payable | $ | 21,001 | |||||||||||
Accrued payroll | 3,646 | ||||||||||||
Deferred income taxes | 3,563 | ||||||||||||
Accrued expenses | 1,959 | ||||||||||||
Total current liabilities | $ | 30,169 | |||||||||||
Accrued pension and postretirement benefits | 88 | ||||||||||||
Other long-term liabilities | 5,021 | ||||||||||||
Total liabilities | 35,278 | ||||||||||||
Net assets acquired | $ | 606,968 | |||||||||||
In connection with this acquisition, we identified and valued certain intangible assets, including existing customer relationships, technologies and trademarks, as further discussed in Note 18. It is expected that the majority of the preliminary goodwill recorded of $242.4 million will be deductible for tax purposes. The goodwill is attributable to the operating synergies we expect to gain from the acquisition. These intangible assets are part of both the Industrial and Infrastructure segments. | |||||||||||||
TMB contributed net sales of $44.8 million and a net loss of $7.2 million during the two months ended December 31, 2013, including $1.7 million of acquisition-related pre-tax costs. | |||||||||||||
Unaudited Pro Forma Financial Information | |||||||||||||
The following unaudited pro forma summary of operating results presents the consolidated results of operations as if the TMB acquisition had occurred on July 1, 2012. These amounts were calculated after applying our accounting policies and adjusting TMB's results to reflect increased depreciation and amortization expense resulting from recording fixed assets and intangible assets at fair value. The pro forma results for the three and six months ended December 31, 2013 exclude $1.7 million and $2.8 million of acquisition-related pre-tax costs. The pro forma results for the three and six months ended December 31, 2013 includes $4.5 million and $9.0 million, respectively, of integration-related and restructuring-related expenses. The pro forma results have been presented for comparative purposes only and are not indicative of future results of operations or what would have occurred had the acquisition been made on July 1, 2012. | |||||||||||||
Unaudited pro forma summary of operating results of Kennametal, assuming the acquisition had occurred as of July 1, 2012, are as follows: | |||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | ||||||||||||
(in thousands, except per share amounts) | 2013 | 2012 | 2013 | 2012 | |||||||||
Pro forma (unaudited): | |||||||||||||
Net Sales | $ | 721,062 | $ | 731,941 | $ | 1,434,250 | $ | 1,468,196 | |||||
Net income attributable to Kennametal | $ | 35,934 | $ | 33,112 | $ | 70,778 | $ | 78,239 | |||||
Per share data attributable to Kennametal: | |||||||||||||
Basic earnings per share | $ | 0.46 | $ | 0.42 | $ | 0.9 | $ | 0.98 | |||||
Diluted earnings per share | $ | 0.45 | $ | 0.41 | $ | 0.89 | $ | 0.96 | |||||
Emura | |||||||||||||
On August 1, 2013, the Company acquired the operating assets of Comercializadora Emura S.R.L. and certain related entities (Emura), based in La Paz, Bolivia, and secured related material sourcing agreements for a purchase price of $40.1 million, of which $26.1 million represents cash paid of which $25.6 million was paid in fiscal year 2014 and $0.5 million was paid in fiscal year 2013, and $14.0 million of contingent consideration (see Note 6). Emura is the region’s principal operation engaged in collecting, testing, processing and exporting tungsten ore material, and was a long-standing supplier to Kennametal. The addition of Emura enhances the Company's strategic tungsten sourcing capabilities to serve growth globally. | |||||||||||||
Other | |||||||||||||
The Company acquired one other acquisition in the Infrastructure segment for $2.0 million. |
Fair_Value_Measurements
Fair Value Measurements | 6 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||||
FAIR VALUE MEASUREMENTS | ||||||||||||||||
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy consists of three levels to prioritize the inputs used in valuations, as defined below: | ||||||||||||||||
Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. | ||||||||||||||||
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including 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; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means. | ||||||||||||||||
Level 3: Inputs that are unobservable. | ||||||||||||||||
As of December 31, 2013, the fair values of the Company’s financial assets and financial liabilities measured at fair value on a recurring basis are categorized as follows: | ||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 129 | $ | — | $ | 129 | ||||||||
Total assets at fair value | $ | — | $ | 129 | $ | — | $ | 129 | ||||||||
Liabilities: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 1,227 | $ | — | $ | 1,227 | ||||||||
Contingent consideration | — | — | 14,000 | 14,000 | ||||||||||||
Total liabilities at fair value | $ | — | $ | 1,227 | $ | 14,000 | $ | 15,227 | ||||||||
The fair value of contingent consideration payable that was classified as Level 3 relates to our probability assessments of expected future milestone targets, primarily associated with product delivery, related to the Emura acquisition. The contingent consideration is to be paid over the next 3 years. | ||||||||||||||||
As of June 30, 2013, the fair value of the Company’s financial assets and financial liabilities measured at fair value on a recurring basis are categorized as follows: | ||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 775 | $ | — | $ | 775 | ||||||||
Total assets at fair value | $ | — | $ | 775 | $ | — | $ | 775 | ||||||||
Liabilities: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 530 | $ | — | $ | 530 | ||||||||
Total liabilities at fair value | $ | — | $ | 530 | $ | — | $ | 530 | ||||||||
(1) Currency derivatives are valued based on observable market spot and forward rates and are classified within Level 2 of the fair value hierarchy. |
Derivative_Instruments_and_Hed
Derivative Instruments and Hedging Activities | 6 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | |||||||||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ' | |||||||||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||||||||||||||
As part of our financial risk management program, we use certain derivative financial instruments. We do not enter into derivative transactions for speculative purposes and, therefore, hold no derivative instruments for trading purposes. We account for derivative instruments as a hedge of the related asset, liability, firm commitment or anticipated transaction, when the derivative is specifically designated and qualifies as a hedge of such items. Our objective in managing foreign exchange exposures with derivative instruments is to reduce volatility in cash flow. We measure hedge effectiveness by assessing the changes in the fair value or expected future cash flows of the hedged item. The ineffective portions are recorded in other expense (income), net. | ||||||||||||||||
The fair value of derivatives designated and not designated as hedging instruments in the condensed consolidated balance sheet are as follows: | ||||||||||||||||
(in thousands) | December 31, | June 30, | ||||||||||||||
2013 | 2013 | |||||||||||||||
Derivatives designated as hedging instruments | ||||||||||||||||
Other current assets - range forward contracts | $ | 73 | $ | 658 | ||||||||||||
Other current liabilities - range forward contracts | (1,095 | ) | (522 | ) | ||||||||||||
Other assets - range forward contracts | — | 69 | ||||||||||||||
Total derivatives designated as hedging instruments | (1,022 | ) | 205 | |||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||
Other current assets - currency forward contracts | 56 | 48 | ||||||||||||||
Other current liabilities - currency forward contracts | (132 | ) | (8 | ) | ||||||||||||
Total derivatives not designated as hedging instruments | (76 | ) | 40 | |||||||||||||
Total derivatives | $ | (1,098 | ) | $ | 245 | |||||||||||
Certain currency forward contracts that hedge significant cross-border intercompany loans are considered as other derivatives and therefore do not qualify for hedge accounting. These contracts are recorded at fair value in the condensed consolidated balance sheet, with the offset to other expense (income), net. Losses related to derivatives not designated as hedging instruments have been recognized as follows: | ||||||||||||||||
Three Months Ended December 31, | Six Months Ended | |||||||||||||||
December 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Other expense (income), net - currency forward contracts | $ | 72 | $ | 261 | $ | 114 | $ | 1,470 | ||||||||
FAIR VALUE HEDGES | ||||||||||||||||
Fixed-to-floating interest rate swap contracts, designated as fair value hedges, are entered into from time to time to hedge our exposure to fair value fluctuations on a portion of our fixed rate debt. We had no such contracts outstanding at December 31, 2013 or June 30, 2013. | ||||||||||||||||
CASH FLOW HEDGES | ||||||||||||||||
Range forward contracts (a transaction where both a put option is purchased and a call option is sold) are designated as cash flow hedges and hedge anticipated cash flows from cross-border intercompany sales of products and services. Gains and losses realized on these contracts at maturity are recorded in accumulated other comprehensive loss, and are recognized as a component of other expense (income), net when the underlying sale of products or services is recognized into earnings. The notional amount of the contracts translated into U.S. dollars at December 31, 2013 and June 30, 2013, was $60.8 million and $102.2 million, respectively. The time value component of the fair value of range forward contracts is excluded from the assessment of hedge effectiveness. Assuming the market rates remain constant with the rates at December 31, 2013, we expect to recognize into earnings in the next 12 months $0.8 million of losses on outstanding derivatives. | ||||||||||||||||
In February 2012, we settled forward starting interest rate swap contracts to convert $150.0 million of our floating rate debt to fixed rate debt. Upon settlement, we made a cash payment of $22.4 million. The loss is being amortized as a component of interest expense over the term of the related debt using the effective interest rate method. During the three months ended December 31, 2013 and 2012, $0.5 million and $0.5 million was recognized as interest expense, respectively. During the six months ended December 31, 2013 and 2012, $1.0 million and $0.9 million was recognized as interest expense, respectively. | ||||||||||||||||
The following represents gains and losses related to cash flow hedges: | ||||||||||||||||
Three Months Ended December 31, | Six Months Ended | |||||||||||||||
December 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Losses recognized in other comprehensive loss, net | $ | (273 | ) | $ | (102 | ) | $ | (843 | ) | $ | (673 | ) | ||||
Losses reclassified from accumulated other comprehensive loss into other expense (income), net | $ | 324 | $ | 298 | $ | 714 | $ | 257 | ||||||||
No portion of the gains or losses recognized in earnings was due to ineffectiveness and no amounts were excluded from our effectiveness testing for the six months ended December 31, 2013 and 2012. |
Restructuring
Restructuring | 6 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Restructuring Charges [Abstract] | ' | |||||||||||||||||||
RESTRUCTURING | ' | |||||||||||||||||||
RESTRUCTURING | ||||||||||||||||||||
During the quarter, we announced our intent to implement restructuring actions to achieve synergies across Kennametal as a result of the TMB acquisition. We initiated actions during the current quarter related to employment reductions. These and other restructuring actions are expected to be completed over the next three years. Total pre-tax charges are expected to be in the range of $40 million to $50 million. | ||||||||||||||||||||
In conjunction with these initiatives, we recorded restructuring charges of $2.3 million during the quarter ended December 31, 2013. | ||||||||||||||||||||
The restructuring accrual is recorded in other current liabilities in our condensed consolidated balance sheet and the amount attributable to each segment is as follows: | ||||||||||||||||||||
(in thousands) | 30-Jun-13 | Expense | Translation | Cash Expenditures | 31-Dec-13 | |||||||||||||||
Industrial | ||||||||||||||||||||
Severance | $ | — | $ | 1,085 | $ | 1 | $ | (984 | ) | $ | 102 | |||||||||
Total Industrial | — | 1,085 | 1 | (984 | ) | 102 | ||||||||||||||
Infrastructure | ||||||||||||||||||||
Severance | — | 1,225 | 9 | (535 | ) | 699 | ||||||||||||||
Total Infrastructure | — | 1,225 | 9 | (535 | ) | 699 | ||||||||||||||
Total | $ | — | $ | 2,310 | $ | 10 | $ | (1,519 | ) | $ | 801 | |||||||||
StockBased_Compensation
Stock-Based Compensation | 6 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
STOCK-BASED COMPENSATION | ' | |||||||||||||
STOCK-BASED COMPENSATION | ||||||||||||||
Stock Options | ||||||||||||||
The assumptions used in our Black-Scholes valuation related to grants made during the six months ended December 31, 2013 and 2012 were as follows: | ||||||||||||||
2013 | 2012 | |||||||||||||
Risk-free interest rate | 1.3 | % | 0.6 | % | ||||||||||
Expected life (years) (1) | 4.5 | 4.5 | ||||||||||||
Expected volatility (2) | 40.4 | % | 49.5 | % | ||||||||||
Expected dividend yield | 1.5 | % | 1.4 | % | ||||||||||
(1) Expected life is derived from historical experience. | ||||||||||||||
(2) Expected volatility is based on the implied historical volatility of our stock. | ||||||||||||||
Changes in our stock options for the six months ended December 31, 2013 were as follows: | ||||||||||||||
Options | Weighted | Weighted | Aggregate | |||||||||||
Average | Average | Intrinsic value | ||||||||||||
Exercise Price | Remaining | (in thousands) | ||||||||||||
Life (years) | ||||||||||||||
Options outstanding, June 30, 2013 | 2,729,068 | $ | 30.4 | |||||||||||
Granted | 342,662 | 45.24 | ||||||||||||
Exercised | (479,164 | ) | 26.25 | |||||||||||
Lapsed and forfeited | (14,836 | ) | 38.68 | |||||||||||
Options outstanding, December 31, 2013 | 2,577,730 | $ | 33.1 | 5.8 | $ | 48,899 | ||||||||
Options vested and expected to vest, | 2,535,445 | $ | 32.97 | 5.8 | $ | 48,439 | ||||||||
December 31, 2013 | ||||||||||||||
Options exercisable, December 31, 2013 | 1,759,651 | $ | 30.14 | 4.6 | $ | 38,586 | ||||||||
During the six months ended December 31, 2013 and 2012, compensation expense related to stock options was $3.5 million and $4.0 million, respectively. As of December 31, 2013, the total unrecognized compensation cost related to options outstanding was $4.0 million and is expected to be recognized over a weighted average period of 2.8 years. | ||||||||||||||
Weighted average fair value of options granted during the six months ended December 31, 2013 and 2012 was $13.79 and $13.52, respectively. Fair value of options vested during the six months ended December 31, 2013 and 2012 was $5.0 million and $5.1 million, respectively. | ||||||||||||||
Tax benefits, relating to excess stock-based compensation deductions, are presented in the condensed consolidated statements of cash flow as financing cash inflows. Tax benefits resulting from stock-based compensation deductions exceeded amounts reported for financial reporting purposes by $4.5 million and $1.1 million for the six months ended December 31, 2013 and 2012, respectively. | ||||||||||||||
The amount of cash received from the exercise of capital stock options during the six months ended December 31, 2013 and 2012 was $12.7 million and $3.8 million, respectively. The related tax benefit for the six months ended December 31, 2013 and 2012 was $2.7 million and $0.8 million, respectively. The total intrinsic value of options exercised during the six months ended December 31, 2013 and 2012 was $9.2 million and $2.5 million, respectively. | ||||||||||||||
Under the provisions of the Kennametal Inc. Stock and Incentive Plan of 2010, Plan participants may deliver stock owned by the holder for at least six months, in payment of the option price and receive credit for the fair market value of the shares on the date of delivery. The fair market value of shares delivered during the six months ended December 31, 2013 was $0.2 million. The fair market value of shares delivered during the six months ended December 31, 2012 was immaterial. | ||||||||||||||
Restricted Stock Units – Time Vesting and Performance Vesting | ||||||||||||||
Performance vesting restricted stock units are earned pro rata each year if certain performance goals are met over a three-year period, and are also subject to a service condition that requires the individual to be employed by the Company at the payment date after the three-year performance period, with the exception of retirement eligible grantees, who upon retirement are entitled to receive payment for any units that have been earned, including a prorated portion in the partially completed fiscal year in which the retirement occurs. | ||||||||||||||
Changes in our time vesting and performance vesting restricted stock units for the six months ended December 31, 2013 were as follows: | ||||||||||||||
Performance | Performance | Time Vesting | Time Vesting | |||||||||||
Vesting | Vesting | Stock Units | Weighted | |||||||||||
Stock | Weighted | Average Fair | ||||||||||||
Units | Average Fair | Value | ||||||||||||
Value | ||||||||||||||
Unvested performance vesting and time vesting restricted stock units, June 30, 2013 | 367,612 | $ | 32.08 | 815,210 | $ | 34.53 | ||||||||
Granted | 82,449 | 45.24 | 305,501 | 45.17 | ||||||||||
Vested | (156,798 | ) | 26.89 | (297,811 | ) | 32.44 | ||||||||
Performance metric not achieved | (95,907 | ) | 45.24 | — | — | |||||||||
Forfeited | — | — | (31,705 | ) | 39.54 | |||||||||
Unvested performance vesting and time vesting restricted stock units, December 31, 2013 | 197,356 | $ | 40.92 | 791,195 | $ | 39.23 | ||||||||
During the six months ended December 31, 2013 and 2012, compensation expense related to time vesting and performance vesting restricted stock units was $8.4 million and $11.4 million, respectively. As of December 31, 2013, the total unrecognized compensation cost related to unvested time vesting and performance vesting restricted stock units was $20.1 million and is expected to be recognized over a weighted average period of 2.6 years. |
Benefit_Plans
Benefit Plans | 6 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | ' | |||||||||||||||
BENEFIT PLANS | ' | |||||||||||||||
BENEFIT PLANS | ||||||||||||||||
We sponsor several defined benefit pension plans. Additionally, we provide varying levels of postretirement health care and life insurance benefits to some U.S. employees. | ||||||||||||||||
The table below summarizes the components of net periodic pension cost: | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Service cost | $ | 1,732 | $ | 1,956 | $ | 3,448 | $ | 3,908 | ||||||||
Interest cost | 10,308 | 9,601 | 20,484 | 19,182 | ||||||||||||
Expected return on plan assets | (14,916 | ) | (14,074 | ) | (29,712 | ) | (28,152 | ) | ||||||||
Amortization of transition obligation | 20 | 18 | 38 | 36 | ||||||||||||
Amortization of prior service credit | (58 | ) | (48 | ) | (117 | ) | (97 | ) | ||||||||
Recognition of actuarial losses | 670 | 3,752 | 1,312 | 7,499 | ||||||||||||
Net periodic pension (credit) cost | $ | (2,244 | ) | $ | 1,205 | $ | (4,547 | ) | $ | 2,376 | ||||||
The table below summarizes the components of the net periodic other postretirement benefit cost: | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Service cost | $ | 14 | $ | 18 | $ | 28 | $ | 36 | ||||||||
Interest cost | 251 | 234 | 502 | 469 | ||||||||||||
Amortization of prior service cost | (28 | ) | (28 | ) | (56 | ) | (55 | ) | ||||||||
Recognition of actuarial loss | 79 | 104 | 158 | 208 | ||||||||||||
Net periodic other postretirement benefit cost | $ | 316 | $ | 328 | $ | 632 | $ | 658 | ||||||||
Inventories
Inventories | 6 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
INVENTORIES | ' | |||||||
INVENTORIES | ||||||||
We used the last-in, first-out (LIFO) method of valuing inventories for 46 percent and 52 percent of total inventories at December 31, 2013 and June 30, 2013, respectively. Because inventory valuations under the LIFO method are based on an annual determination of quantities and costs as of June 30 of each year, the interim LIFO valuations are based on our projections of expected year-end inventory levels and costs. Therefore, the interim financial results are subject to any final year-end LIFO inventory adjustments. | ||||||||
Inventories consisted of the following: | ||||||||
(in thousands) | 31-Dec-13 | 30-Jun-13 | ||||||
Finished goods | $ | 378,940 | $ | 303,307 | ||||
Work in process and powder blends | 299,254 | 244,180 | ||||||
Raw materials | 152,981 | 137,602 | ||||||
Inventories at current cost | 831,175 | 685,089 | ||||||
Less: LIFO valuation | (100,497 | ) | (106,294 | ) | ||||
Total inventories | $ | 730,678 | $ | 578,795 | ||||
Long_Term_Debt
Long - Term Debt | 6 Months Ended |
Dec. 31, 2013 | |
Debt Disclosure [Abstract] | ' |
LONG-TERM DEBT AND CAPITAL LEASES | ' |
LONG-TERM DEBT | |
Our $600 million five-year, multi-currency, revolving credit facility (2011 Credit Agreement) requires us to comply with various restrictive and affirmative covenants, including two financial covenants: a maximum leverage ratio and a minimum consolidated interest coverage ratio (as those terms are defined in the agreement). We were in compliance with all covenants as of December 31, 2013. We had $360.7 million and $3.6 million of borrowings outstanding under the 2011 Credit Agreement as of December 31, 2013 and June 30, 2013, respectively. Borrowings under the 2011 Credit Agreement are guaranteed by our significant domestic subsidiaries. The 2011 Credit Agreement matures in April 2018. | |
Fixed rate debt had a fair market value of $680.3 million and $680.1 million at December 31, 2013 and June 30, 2013, respectively. The Level 1 fair value is determined based on the quoted market price of this debt as of December 31, 2013 and June 30, 2013, respectively. |
Environmental_Matters
Environmental Matters | 6 Months Ended |
Dec. 31, 2013 | |
Environmental Remediation Obligations [Abstract] | ' |
ENVIRONMENTAL MATTERS | ' |
ENVIRONMENTAL MATTERS | |
The operation of our business has exposed us to certain liabilities and compliance costs related to environmental matters. We are involved in various environmental cleanup and remediation activities at certain of our locations. | |
Superfund Sites We are involved as a potentially responsible party (PRP) at various sites designated by the United States Environmental Protection Agency (USEPA) as Superfund sites. For certain of these sites, we have evaluated the claims and potential liabilities and have determined that neither are material, individually or in the aggregate. For certain other sites that are being monitored, the matters have not yet progressed to a point where it is possible to estimate the ultimate cost of remediation, the timing and extent of remedial action that may be required by governmental authorities or the amount of our liability alone or in relation to that of any other PRP. | |
Other Environmental Matters We establish and maintain reserves for other potential environmental issues. At December 31, 2013 and June 30, 2013, the balances of these reserves were $5.2 million and $5.1 million, respectively. These reserves represent anticipated costs associated with the remediation of these issues. | |
The reserves we have established for environmental liabilities represent our best current estimate of the costs of addressing all identified environmental situations, based on our review of currently available evidence, and taking into consideration our prior experience in remediation and that of other companies, as well as public information released by the USEPA, other governmental agencies, and by the PRP groups in which we are participating. Although the reserves currently appear to be sufficient to cover these environmental liabilities, there are uncertainties associated with environmental liabilities, and we can give no assurance that our estimate of any environmental liability will not increase or decrease in the future. The reserved and unreserved liabilities for all environmental concerns could change substantially due to factors such as the nature and extent of contamination, changes in remedial requirements, technological changes, discovery of new information, the financial strength of other PRPs, the identification of new PRPs and the involvement of and direction taken by the government on these matters. | |
We maintain a Corporate Environmental Health and Safety (EHS) Department to monitor compliance with environmental regulations and to oversee remediation activities. In addition, we have designated EHS coordinators who are responsible for each of our global manufacturing facilities. Our financial management team periodically meets with members of the Corporate EHS Department and the Corporate Legal Department to review and evaluate the status of environmental projects and contingencies. On a quarterly basis, we review financial provisions and reserves for environmental contingencies and adjust these reserves when appropriate. |
Income_Taxes
Income Taxes | 6 Months Ended |
Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | ' |
INCOME TAXES | ' |
INCOME TAXES | |
The effective income tax rate for the three months ended December 31, 2013 and 2012 was 40.8 percent and 26.4 percent, respectively. The effective income tax rate for the six months ended December 31, 2013 and 2012 was 31.8 percent and 23.5 percent, respectively. The increase for both the three and six month periods was primarily driven by a $7.2 million tax charge incurred in the quarter related to a change in assertion of a foreign subsidiary's certain undistributed earnings, which are no longer considered permanently reinvested. This change in assertion during the current quarter is related to the repatriation of $57.0 million. All earnings of other non U.S. subsidiaries are indefinitely reinvested and no deferred taxes have been provided on those earnings. This tax charge was partially offset by a lower relative U.S. current year earnings contribution. |
Earnings_Per_Share
Earnings Per Share | 6 Months Ended |
Dec. 31, 2013 | |
Earnings Per Share [Abstract] | ' |
EARNINGS PER SHARE | ' |
EARNINGS PER SHARE | |
Basic earnings per share is computed using the weighted average number of shares outstanding during the period, while diluted earnings per share is calculated to reflect the potential dilution that occurs related to the issuance of capital stock under stock option grants, restricted stock awards and restricted stock units. The difference between basic and diluted earnings per share relates solely to the effect of capital stock options, restricted stock awards and restricted stock units. | |
For purposes of determining the number of diluted shares outstanding, weighted average shares outstanding for basic earnings per share calculations were increased due solely to the dilutive effect of unexercised capital stock options, unvested restricted stock awards and unvested restricted stock units by 1.0 million shares and 1.3 million shares for the three months ended December 31, 2013 and 2012, respectively, and 1.0 million shares and 1.2 million shares for the six months ended December 31, 2013 and 2012, respectively. Unexercised capital stock options, restricted stock units and restricted stock awards of 0.2 million shares and 0.9 million shares for the three months ended December 31, 2013 and 2012, respectively, and 0.3 million shares and 1.0 million shares for the six months ended December 31, 2013 and 2012, respectively, were not included in the computation of diluted earnings per share because the option exercise price was greater than the average market price, and therefore the inclusion would have been anti-dilutive. |
Equity
Equity | 6 Months Ended | |||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||
Equity [Abstract] | ' | |||||||||||||||||||||||
EQUITY | ' | |||||||||||||||||||||||
EQUITY | ||||||||||||||||||||||||
A summary of the changes in the carrying amounts of total equity, Kennametal Shareowners’ equity and equity attributable to noncontrolling interests as of December 31, 2013 and 2012 is as follows: | ||||||||||||||||||||||||
Kennametal Shareowners’ Equity | ||||||||||||||||||||||||
(in thousands) | Capital | Additional | Retained | Accumulated | Non- | Total equity | ||||||||||||||||||
stock | paid-in | earnings | other | controlling | ||||||||||||||||||||
capital | comprehensive loss | interests | ||||||||||||||||||||||
Balance as of June 30, 2013 | $ | 97,303 | $ | 374,300 | $ | 1,399,227 | $ | (89,004 | ) | $ | 30,467 | $ | 1,812,293 | |||||||||||
Net income | — | — | 62,046 | — | 679 | 62,725 | ||||||||||||||||||
Other comprehensive income | — | — | — | 37,571 | 227 | 37,798 | ||||||||||||||||||
Dividend reinvestment | 3 | 149 | — | — | — | 152 | ||||||||||||||||||
Capital stock issued under employee benefit and stock plans | 1,056 | 21,926 | — | — | — | 22,982 | ||||||||||||||||||
Purchase of capital stock | (128 | ) | (4,272 | ) | — | — | — | (4,400 | ) | |||||||||||||||
Cash dividends paid | — | — | (28,180 | ) | — | (66 | ) | (28,246 | ) | |||||||||||||||
Balance as of December 31, | $ | 98,234 | $ | 392,103 | $ | 1,433,093 | $ | (51,433 | ) | $ | 31,307 | $ | 1,903,304 | |||||||||||
2013 | ||||||||||||||||||||||||
Kennametal Shareowners’ Equity | ||||||||||||||||||||||||
(in thousands) | Capital | Additional | Retained | Accumulated | Non- | Total equity | ||||||||||||||||||
stock | paid-in | earnings | other | controlling | ||||||||||||||||||||
capital | comprehensive | interests | ||||||||||||||||||||||
loss | ||||||||||||||||||||||||
Balance as of June 30, 2012 | $ | 100,106 | $ | 447,433 | $ | 1,246,973 | $ | (150,662 | ) | $ | 24,371 | $ | 1,668,221 | |||||||||||
Net income | — | — | 88,532 | — | 1,823 | 90,355 | ||||||||||||||||||
Other comprehensive income | — | — | — | 40,819 | 686 | 41,505 | ||||||||||||||||||
Dividend reinvestment | 4 | 134 | — | — | — | 138 | ||||||||||||||||||
Capital stock issued under employee benefit and stock plans | 415 | 18,601 | — | — | — | 19,016 | ||||||||||||||||||
Purchase of capital stock | (1,587 | ) | (45,029 | ) | — | — | — | (46,616 | ) | |||||||||||||||
Cash dividends paid | — | — | (25,748 | ) | — | (1,949 | ) | (27,697 | ) | |||||||||||||||
Purchase of noncontrolling interests | — | — | — | — | (479 | ) | (479 | ) | ||||||||||||||||
Balance as of December 31, 2012 | $ | 98,938 | $ | 421,139 | $ | 1,309,757 | $ | (109,843 | ) | $ | 24,452 | $ | 1,744,443 | |||||||||||
The amounts of comprehensive income attributable to Kennametal Shareowners and noncontrolling interests are disclosed in the condensed consolidated statements of comprehensive income. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Loss | 6 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ' | ||||||||||||
Accumulated Other Comprehensive Loss | ' | ||||||||||||
ACCUMULATED OTHER COMPREHENSIVE LOSS | |||||||||||||
Total accumulated other comprehensive loss (AOCL) consists of net income and other changes in equity from transactions and other events from sources other than shareowners. It includes postretirement benefit plan adjustments, currency translation adjustments, and unrealized gains and losses from derivative instruments designated as cash flow hedges. | |||||||||||||
The components of and changes in AOCL were as follows (net of tax) for the three months ended December 31, 2013: | |||||||||||||
Attributable to Kennametal: | Postretirement benefit plans | Currency translation adjustment | Derivatives | Total | |||||||||
Balance, September 30, 2013 | $ | (85,419 | ) | $ | 35,510 | $ | (12,642 | ) | $ | (62,551 | ) | ||
Other comprehensive loss before | (810 | ) | 11,263 | (273 | ) | 10,180 | |||||||
reclassifications | |||||||||||||
Amounts reclassified from AOCL | 498 | — | 440 | 938 | |||||||||
Net current period other comprehensive | (312 | ) | 11,263 | 167 | 11,118 | ||||||||
loss | |||||||||||||
AOCL, December 31, 2013 | $ | (85,731 | ) | $ | 46,773 | $ | (12,475 | ) | $ | (51,433 | ) | ||
Attributable to noncontrolling interests: | |||||||||||||
Balance, September 30, 2013 | $ | — | $ | 535 | $ | — | $ | 535 | |||||
Other comprehensive loss before | — | 413 | — | 413 | |||||||||
reclassifications | |||||||||||||
Net current period other comprehensive | — | 413 | — | 413 | |||||||||
loss | |||||||||||||
AOCL, December 31, 2013 | $ | — | $ | 948 | $ | — | $ | 948 | |||||
The components of and changes in AOCL were as follows (net of tax) for the six months ended December 31, 2013: | |||||||||||||
Attributable to Kennametal: | Postretirement benefit plans | Currency translation adjustment | Derivatives | Total | |||||||||
Balance, June 30, 2013 | $ | (83,937 | ) | $ | 7,414 | $ | (12,481 | ) | $ | (89,004 | ) | ||
Other comprehensive loss before | (2,776 | ) | 39,359 | (843 | ) | 35,740 | |||||||
reclassifications | |||||||||||||
Amounts reclassified from AOCL | 982 | — | 849 | 1,831 | |||||||||
Net current period other comprehensive | (1,794 | ) | 39,359 | 6 | 37,571 | ||||||||
loss | |||||||||||||
AOCL, December 31, 2013 | $ | (85,731 | ) | $ | 46,773 | $ | (12,475 | ) | $ | (51,433 | ) | ||
Attributable to noncontrolling interests: | |||||||||||||
Balance, June 30, 2013 | $ | — | $ | 721 | $ | — | $ | 721 | |||||
Other comprehensive loss before | — | 227 | — | 227 | |||||||||
reclassifications | |||||||||||||
Net current period other comprehensive | — | 227 | — | 227 | |||||||||
loss | |||||||||||||
AOCL, December 31, 2013 | $ | — | $ | 948 | $ | — | $ | 948 | |||||
Reclassifications out of AOCL for the three and six months ended December 31, 2013 consisted of the following: | |||||||||||||
Details about AOCL components | Three months ended December 31, 2013 | Six months ended December 31, 2013 | Affected line item in the Income Statement | ||||||||||
Gains and losses on cash flow hedges: | |||||||||||||
Forward starting interest rate swaps | $ | 486 | $ | 973 | Interest expense | ||||||||
Currency exchange contracts | 224 | 396 | Other expense (income), net | ||||||||||
Total before tax | 710 | 1,369 | |||||||||||
Tax benefit | 270 | 520 | Provision for income taxes | ||||||||||
Net of tax | $ | 440 | $ | 849 | |||||||||
Postretirement benefit plans: | |||||||||||||
Amortization of transition obligations | $ | 20 | $ | 38 | See pension note 10 for further details | ||||||||
Amortization of prior service credit | (86 | ) | (173 | ) | See pension note 10 for further details | ||||||||
Recognition of actuarial losses | 749 | 1,470 | See pension note 10 for further details | ||||||||||
Total before taxes | 683 | 1,335 | |||||||||||
Tax benefit | 185 | 353 | Provision for income taxes | ||||||||||
Net of tax | $ | 498 | $ | 982 | |||||||||
Goodwill_and_Other_Intangible_
Goodwill and Other Intangible Assets | 6 Months Ended | |||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||||||
GOODWILL AND OTHER INTANGIBLE ASSETS | ' | |||||||||||||||||
GOODWILL AND OTHER INTANGIBLE ASSETS | ||||||||||||||||||
Goodwill represents the excess of cost over the fair value of the net assets of acquired companies. Goodwill and other intangible assets with indefinite lives are tested at least annually for impairment. We perform our annual impairment tests during the June quarter in connection with our annual planning process, unless there are impairment indicators that warrant a test prior to that. We noted no impairment indicators warranting additional testing. | ||||||||||||||||||
A summary of the carrying amount of goodwill attributable to each segment, as well as the changes in such, is as follows: | ||||||||||||||||||
(in thousands) | Industrial | Infrastructure | TMB Acquisition | Total | ||||||||||||||
Goodwill | $ | 273,757 | $ | 598,840 | $ | — | $ | 872,597 | ||||||||||
Accumulated impairment losses | (15,674 | ) | (135,168 | ) | — | (150,842 | ) | |||||||||||
Balance as of June 30, 2013 (1) | $ | 258,083 | $ | 463,672 | $ | — | $ | 721,755 | ||||||||||
Acquisition | $ | — | $ | — | $ | 242,363 | $ | 242,363 | ||||||||||
Translation | 5,209 | 8,317 | — | 13,526 | ||||||||||||||
Change in goodwill | 5,209 | 8,317 | 242,363 | 255,889 | ||||||||||||||
Goodwill | 278,966 | 607,157 | 242,363 | 1,128,486 | ||||||||||||||
Accumulated impairment losses | (15,674 | ) | (135,168 | ) | — | (150,842 | ) | |||||||||||
Balance as of December 31, 2013 | $ | 263,292 | $ | 471,989 | $ | 242,363 | $ | 977,644 | ||||||||||
(1) The balance as of June 30, 2013 have been restated to reflect the change in reportable operating segments. | ||||||||||||||||||
The assignment of the goodwill for the TMB acquisition has not yet been completed and therefore has not been allocated between the segments. | ||||||||||||||||||
The components of our other intangible assets were as follows: | ||||||||||||||||||
Estimated | 31-Dec-13 | 30-Jun-13 | ||||||||||||||||
Useful Life | ||||||||||||||||||
(in thousands) | (in years) | Gross Carrying | Accumulated | Gross Carrying | Accumulated | |||||||||||||
Amount | Amortization | Amount | Amortization | |||||||||||||||
Contract-based | 3 to 15 | $ | 21,842 | $ | (9,421 | ) | $ | 21,450 | $ | (8,374 | ) | |||||||
Technology-based and other | 4 to 20 | 55,317 | (27,606 | ) | 38,005 | (26,006 | ) | |||||||||||
Customer-related | 10 to 20 | 283,460 | (66,880 | ) | 178,318 | (58,148 | ) | |||||||||||
Unpatented technology | 15 to 30 | 63,275 | (11,244 | ) | 45,972 | (9,761 | ) | |||||||||||
Trademarks | 5 to 20 | 19,435 | (10,025 | ) | 14,055 | (9,151 | ) | |||||||||||
Trademarks | Indefinite | 37,428 | — | 36,405 | — | |||||||||||||
Total | $ | 480,757 | $ | (125,176 | ) | $ | 334,205 | $ | (111,440 | ) | ||||||||
During the six months ended December 31, 2013, we recorded amortization expense of $11.7 million related to our other intangible assets and favorable currency translation adjustments of $3.8 million. | ||||||||||||||||||
On November 4, 2013, we acquired TMB from ATI, the operations of which are included in both the Industrial and Infrastructure segments. As a result of the acquisition, we increased goodwill by $242.4 million and other intangible assets by $124.2 million based on our preliminary purchase price allocations. Other intangible assets consisted of customer-related intangibles, technology-based intangibles and trademarks. We are in the process of assessing the allocation of goodwill and other intangible assets, as well as the useful lives of the other intangible assets. The majority of both the goodwill and other intangible assets will be allocated to the Infrastructure segment, as this is primarily where the operating synergies associated with the acquisition are expected to be realized. The Company estimates that acquired intangibles will add approximately $8 million to annual amortization expense per year. | ||||||||||||||||||
On August 1, 2013, we acquired the assets of Emura in our Infrastructure segment. As a result of the acquisition we increased other intangible assets by $16.0 million based on our preliminary purchase price allocations. We recorded supplier relationship intangible assets in technology-based and other of $15.5 million with an estimated useful life of 20 years, contract-based intangibles of $0.4 million with an estimated useful life of 3 years and trademarks of $0.1 million with an estimated useful life of 20 years. These intangible assets will be amortized over their respective estimated useful lives. |
Segment_Data
Segment Data | 6 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
SEGMENT DATA | ' | |||||||||||||||
SEGMENT DATA | ||||||||||||||||
Kennametal delivers productivity to customers seeking peak performance in demanding environments by providing innovative custom and standard wear-resistant solutions. To provide these solutions, we harness our knowledge of advanced materials and application development with a commitment to environmental sustainability. Our product offering includes a wide selection of standard and customized technologies for metalworking, such as sophisticated metalcutting tools, tooling systems and services, as well as advanced, high-performance materials, such as cemented tungsten carbide products, super alloys, coatings and investment castings to address customer demands. We offer these products through a variety of channels to meet customer-specified needs. | ||||||||||||||||
At the start of fiscal 2014, the Company enhanced its organizational structure to align a broader base management team with customer-facing products and technology platforms, as well as to further increase cross-selling opportunities. This operating structure supports the Company's stated growth objectives across diverse market sectors, preserves the focus on customers and increases product innovation. Consistent with previous allocation methodologies, corporate expenses related to each segment have been classified accordingly. | ||||||||||||||||
The Industrial segment generally serves customers that operate in industrial end markets such as aerospace, defense, transportation and general engineering. The customers in these end markets manufacture engines, airframes, automobiles, trucks, ships and various types of industrial equipment. The technology and customization requirements for customers we serve vary by customer, application and industry. The value we deliver to our Industrial segment customers centers on our application expertise and our diverse offering of products and services. | ||||||||||||||||
The Infrastructure segment generally serves customers that operate in the earthworks and energy sectors who support primary industries such as oil and gas, power generation, underground, surface and hard-rock mining, highway construction and road maintenance. Generally, we rely on customer intimacy to serve this segment. By gaining an in-depth understanding of our customers’ engineering and development needs, we are able to offer complete system solutions and high-performance capabilities to optimize and add value to their operations. | ||||||||||||||||
Corporate expenses related to executive retirement plans, the Company’s Board of Directors and strategic initiatives, as well as certain other costs, are reported as Corporate. | ||||||||||||||||
Our sales and operating income by segment are as follows: | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in thousands) | 2013 | 2012 (1) | 2013 | 2012 (1) | ||||||||||||
Sales: | ||||||||||||||||
Industrial | $ | 370,647 | $ | 336,007 | $ | 708,876 | $ | 671,201 | ||||||||
Infrastructure | 319,289 | 297,137 | 600,867 | 591,402 | ||||||||||||
Total sales | $ | 689,936 | $ | 633,144 | $ | 1,309,743 | $ | 1,262,603 | ||||||||
Operating income: | ||||||||||||||||
Industrial | $ | 33,218 | $ | 40,677 | $ | 73,038 | $ | 80,004 | ||||||||
Infrastructure | 18,604 | 27,906 | 40,294 | 55,503 | ||||||||||||
Corporate | (2,106 | ) | (2,114 | ) | (4,787 | ) | (4,657 | ) | ||||||||
Total operating income | 49,716 | 66,469 | 108,545 | 130,850 | ||||||||||||
Interest expense | 8,037 | 6,970 | 15,118 | 12,926 | ||||||||||||
Other expense (income), net | 856 | 655 | 1,466 | (246 | ) | |||||||||||
Income from continuing operations before income taxes | $ | 40,823 | $ | 58,844 | $ | 91,961 | $ | 118,170 | ||||||||
(1) Amounts for the three and six months ended December 31, 2012 have been restated to reflect the change in reportable operating segments. | ||||||||||||||||
Segment assets by segment are as follows: | ||||||||||||||||
(in thousands) | 31-Dec-13 | June 30, 2013 (2) | ||||||||||||||
Total assets: | ||||||||||||||||
Industrial | $ | 1,329,156 | $ | 1,190,026 | ||||||||||||
Infrastructure | 1,834,544 | 1,522,470 | ||||||||||||||
Corporate | 402,137 | 588,543 | ||||||||||||||
Goodwill from TMB acquisition | 242,363 | — | ||||||||||||||
Total assets | $ | 3,808,200 | $ | 3,301,039 | ||||||||||||
(2) Amounts as of June 30, 2013 have been restated to reflect the change in reportable operating segments. |
Supplemental_Cash_Flow_Disclos1
Supplemental Cash Flow Disclosures (Tables) | 6 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Supplemental Cash Flow Elements [Abstract] | ' | |||||||
Supplemental Cash Flow Disclosures | ' | |||||||
Six Months Ended | ||||||||
December 31, | ||||||||
(in thousands) | 2013 | 2012 | ||||||
Cash paid during the period for: | ||||||||
Interest | $ | 14,231 | $ | 11,338 | ||||
Income taxes | 24,868 | 45,072 | ||||||
Supplemental disclosure of non-cash information: | ||||||||
Changes in accounts payable related to purchases of property, plant and equipment | 8,600 | — | ||||||
Acquisition_Tables
Acquisition (Tables) | 6 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Business Combinations [Abstract] | ' | ||||||||||||
Fair value of assets acquired and liabilities assumed | ' | ||||||||||||
The preliminary allocation of the purchase price to the fair values of the assets acquired and liabilities assumed is as follows: | |||||||||||||
(in thousands) | Total | ||||||||||||
ASSETS | |||||||||||||
Current assets: | |||||||||||||
Cash and cash equivalents | $ | 1,294 | |||||||||||
Accounts Receivable | 41,164 | ||||||||||||
Inventory | 98,664 | ||||||||||||
Other current assets | 4,014 | ||||||||||||
Total current assets | $ | 145,136 | |||||||||||
Property and equipment | 125,283 | ||||||||||||
Goodwill | 242,363 | ||||||||||||
Other intangible assets | 124,200 | ||||||||||||
Deferred income taxes | 3,699 | ||||||||||||
Other | 1,565 | ||||||||||||
Total assets | $ | 642,246 | |||||||||||
LIABILITIES | |||||||||||||
Current liabilities: | |||||||||||||
Accounts payable | $ | 21,001 | |||||||||||
Accrued payroll | 3,646 | ||||||||||||
Deferred income taxes | 3,563 | ||||||||||||
Accrued expenses | 1,959 | ||||||||||||
Total current liabilities | $ | 30,169 | |||||||||||
Accrued pension and postretirement benefits | 88 | ||||||||||||
Other long-term liabilities | 5,021 | ||||||||||||
Total liabilities | 35,278 | ||||||||||||
Net assets acquired | $ | 606,968 | |||||||||||
Pro Forma Information | ' | ||||||||||||
Unaudited pro forma summary of operating results of Kennametal, assuming the acquisition had occurred as of July 1, 2012, are as follows: | |||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | ||||||||||||
(in thousands, except per share amounts) | 2013 | 2012 | 2013 | 2012 | |||||||||
Pro forma (unaudited): | |||||||||||||
Net Sales | $ | 721,062 | $ | 731,941 | $ | 1,434,250 | $ | 1,468,196 | |||||
Net income attributable to Kennametal | $ | 35,934 | $ | 33,112 | $ | 70,778 | $ | 78,239 | |||||
Per share data attributable to Kennametal: | |||||||||||||
Basic earnings per share | $ | 0.46 | $ | 0.42 | $ | 0.9 | $ | 0.98 | |||||
Diluted earnings per share | $ | 0.45 | $ | 0.41 | $ | 0.89 | $ | 0.96 | |||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 6 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
Financial instruments at fair value on recurring basis | ' | |||||||||||||||
As of June 30, 2013, the fair value of the Company’s financial assets and financial liabilities measured at fair value on a recurring basis are categorized as follows: | ||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 775 | $ | — | $ | 775 | ||||||||
Total assets at fair value | $ | — | $ | 775 | $ | — | $ | 775 | ||||||||
Liabilities: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 530 | $ | — | $ | 530 | ||||||||
Total liabilities at fair value | $ | — | $ | 530 | $ | — | $ | 530 | ||||||||
(1) Currency derivatives are valued based on observable market spot and forward rates and are classified within Level 2 of the fair value hierarchy. | ||||||||||||||||
As of December 31, 2013, the fair values of the Company’s financial assets and financial liabilities measured at fair value on a recurring basis are categorized as follows: | ||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 129 | $ | — | $ | 129 | ||||||||
Total assets at fair value | $ | — | $ | 129 | $ | — | $ | 129 | ||||||||
Liabilities: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 1,227 | $ | — | $ | 1,227 | ||||||||
Contingent consideration | — | — | 14,000 | 14,000 | ||||||||||||
Total liabilities at fair value | $ | — | $ | 1,227 | $ | 14,000 | $ | 15,227 | ||||||||
Derivative_Instruments_and_Hed1
Derivative Instruments and Hedging Activities (Tables) | 6 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | |||||||||||||||
Fair value of derivatives | ' | |||||||||||||||
The fair value of derivatives designated and not designated as hedging instruments in the condensed consolidated balance sheet are as follows: | ||||||||||||||||
(in thousands) | December 31, | June 30, | ||||||||||||||
2013 | 2013 | |||||||||||||||
Derivatives designated as hedging instruments | ||||||||||||||||
Other current assets - range forward contracts | $ | 73 | $ | 658 | ||||||||||||
Other current liabilities - range forward contracts | (1,095 | ) | (522 | ) | ||||||||||||
Other assets - range forward contracts | — | 69 | ||||||||||||||
Total derivatives designated as hedging instruments | (1,022 | ) | 205 | |||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||
Other current assets - currency forward contracts | 56 | 48 | ||||||||||||||
Other current liabilities - currency forward contracts | (132 | ) | (8 | ) | ||||||||||||
Total derivatives not designated as hedging instruments | (76 | ) | 40 | |||||||||||||
Total derivatives | $ | (1,098 | ) | $ | 245 | |||||||||||
Losses related to derivatives not designated as hedging instruments | ' | |||||||||||||||
osses related to derivatives not designated as hedging instruments have been recognized as follows: | ||||||||||||||||
Three Months Ended December 31, | Six Months Ended | |||||||||||||||
December 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Other expense (income), net - currency forward contracts | $ | 72 | $ | 261 | $ | 114 | $ | 1,470 | ||||||||
Losses and gains related to cash flow hedges | ' | |||||||||||||||
The following represents gains and losses related to cash flow hedges: | ||||||||||||||||
Three Months Ended December 31, | Six Months Ended | |||||||||||||||
December 31, | ||||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Losses recognized in other comprehensive loss, net | $ | (273 | ) | $ | (102 | ) | $ | (843 | ) | $ | (673 | ) | ||||
Losses reclassified from accumulated other comprehensive loss into other expense (income), net | $ | 324 | $ | 298 | $ | 714 | $ | 257 | ||||||||
Restructuring_Tables
Restructuring (Tables) | 6 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Restructuring Charges [Abstract] | ' | |||||||||||||||||||
Schedule of Restructuring Reserve by Type of Cost | ' | |||||||||||||||||||
The restructuring accrual is recorded in other current liabilities in our condensed consolidated balance sheet and the amount attributable to each segment is as follows: | ||||||||||||||||||||
(in thousands) | 30-Jun-13 | Expense | Translation | Cash Expenditures | 31-Dec-13 | |||||||||||||||
Industrial | ||||||||||||||||||||
Severance | $ | — | $ | 1,085 | $ | 1 | $ | (984 | ) | $ | 102 | |||||||||
Total Industrial | — | 1,085 | 1 | (984 | ) | 102 | ||||||||||||||
Infrastructure | ||||||||||||||||||||
Severance | — | 1,225 | 9 | (535 | ) | 699 | ||||||||||||||
Total Infrastructure | — | 1,225 | 9 | (535 | ) | 699 | ||||||||||||||
Total | $ | — | $ | 2,310 | $ | 10 | $ | (1,519 | ) | $ | 801 | |||||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 6 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
Assumptions used in our Black-Scholes valuation | ' | |||||||||||||
The assumptions used in our Black-Scholes valuation related to grants made during the six months ended December 31, 2013 and 2012 were as follows: | ||||||||||||||
2013 | 2012 | |||||||||||||
Risk-free interest rate | 1.3 | % | 0.6 | % | ||||||||||
Expected life (years) (1) | 4.5 | 4.5 | ||||||||||||
Expected volatility (2) | 40.4 | % | 49.5 | % | ||||||||||
Expected dividend yield | 1.5 | % | 1.4 | % | ||||||||||
(1) Expected life is derived from historical experience. | ||||||||||||||
(2) Expected volatility is based on the implied historical volatility of our stock. | ||||||||||||||
Changes in stock options | ' | |||||||||||||
Changes in our stock options for the six months ended December 31, 2013 were as follows: | ||||||||||||||
Options | Weighted | Weighted | Aggregate | |||||||||||
Average | Average | Intrinsic value | ||||||||||||
Exercise Price | Remaining | (in thousands) | ||||||||||||
Life (years) | ||||||||||||||
Options outstanding, June 30, 2013 | 2,729,068 | $ | 30.4 | |||||||||||
Granted | 342,662 | 45.24 | ||||||||||||
Exercised | (479,164 | ) | 26.25 | |||||||||||
Lapsed and forfeited | (14,836 | ) | 38.68 | |||||||||||
Options outstanding, December 31, 2013 | 2,577,730 | $ | 33.1 | 5.8 | $ | 48,899 | ||||||||
Options vested and expected to vest, | 2,535,445 | $ | 32.97 | 5.8 | $ | 48,439 | ||||||||
December 31, 2013 | ||||||||||||||
Options exercisable, December 31, 2013 | 1,759,651 | $ | 30.14 | 4.6 | $ | 38,586 | ||||||||
Changes in time vesting and performance vesting restricted stock units | ' | |||||||||||||
Changes in our time vesting and performance vesting restricted stock units for the six months ended December 31, 2013 were as follows: | ||||||||||||||
Performance | Performance | Time Vesting | Time Vesting | |||||||||||
Vesting | Vesting | Stock Units | Weighted | |||||||||||
Stock | Weighted | Average Fair | ||||||||||||
Units | Average Fair | Value | ||||||||||||
Value | ||||||||||||||
Unvested performance vesting and time vesting restricted stock units, June 30, 2013 | 367,612 | $ | 32.08 | 815,210 | $ | 34.53 | ||||||||
Granted | 82,449 | 45.24 | 305,501 | 45.17 | ||||||||||
Vested | (156,798 | ) | 26.89 | (297,811 | ) | 32.44 | ||||||||
Performance metric not achieved | (95,907 | ) | 45.24 | — | — | |||||||||
Forfeited | — | — | (31,705 | ) | 39.54 | |||||||||
Unvested performance vesting and time vesting restricted stock units, December 31, 2013 | 197,356 | $ | 40.92 | 791,195 | $ | 39.23 | ||||||||
Benefit_Plans_Tables
Benefit Plans (Tables) | 6 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | ' | |||||||||||||||
Net periodic pension cost | ' | |||||||||||||||
The table below summarizes the components of net periodic pension cost: | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Service cost | $ | 1,732 | $ | 1,956 | $ | 3,448 | $ | 3,908 | ||||||||
Interest cost | 10,308 | 9,601 | 20,484 | 19,182 | ||||||||||||
Expected return on plan assets | (14,916 | ) | (14,074 | ) | (29,712 | ) | (28,152 | ) | ||||||||
Amortization of transition obligation | 20 | 18 | 38 | 36 | ||||||||||||
Amortization of prior service credit | (58 | ) | (48 | ) | (117 | ) | (97 | ) | ||||||||
Recognition of actuarial losses | 670 | 3,752 | 1,312 | 7,499 | ||||||||||||
Net periodic pension (credit) cost | $ | (2,244 | ) | $ | 1,205 | $ | (4,547 | ) | $ | 2,376 | ||||||
Net periodic other postretirement costs (benefit) | ' | |||||||||||||||
The table below summarizes the components of the net periodic other postretirement benefit cost: | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Service cost | $ | 14 | $ | 18 | $ | 28 | $ | 36 | ||||||||
Interest cost | 251 | 234 | 502 | 469 | ||||||||||||
Amortization of prior service cost | (28 | ) | (28 | ) | (56 | ) | (55 | ) | ||||||||
Recognition of actuarial loss | 79 | 104 | 158 | 208 | ||||||||||||
Net periodic other postretirement benefit cost | $ | 316 | $ | 328 | $ | 632 | $ | 658 | ||||||||
Inventories_Tables
Inventories (Tables) | 6 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventories | ' | |||||||
Inventories consisted of the following: | ||||||||
(in thousands) | 31-Dec-13 | 30-Jun-13 | ||||||
Finished goods | $ | 378,940 | $ | 303,307 | ||||
Work in process and powder blends | 299,254 | 244,180 | ||||||
Raw materials | 152,981 | 137,602 | ||||||
Inventories at current cost | 831,175 | 685,089 | ||||||
Less: LIFO valuation | (100,497 | ) | (106,294 | ) | ||||
Total inventories | $ | 730,678 | $ | 578,795 | ||||
Equity_Tables
Equity (Tables) | 6 Months Ended | |||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||
Equity [Abstract] | ' | |||||||||||||||||||||||
Summary of the changes in the carrying amounts of total equity, Kennametal shareowners' equity and equity attributable to noncontrolling interests | ' | |||||||||||||||||||||||
A summary of the changes in the carrying amounts of total equity, Kennametal Shareowners’ equity and equity attributable to noncontrolling interests as of December 31, 2013 and 2012 is as follows: | ||||||||||||||||||||||||
Kennametal Shareowners’ Equity | ||||||||||||||||||||||||
(in thousands) | Capital | Additional | Retained | Accumulated | Non- | Total equity | ||||||||||||||||||
stock | paid-in | earnings | other | controlling | ||||||||||||||||||||
capital | comprehensive loss | interests | ||||||||||||||||||||||
Balance as of June 30, 2013 | $ | 97,303 | $ | 374,300 | $ | 1,399,227 | $ | (89,004 | ) | $ | 30,467 | $ | 1,812,293 | |||||||||||
Net income | — | — | 62,046 | — | 679 | 62,725 | ||||||||||||||||||
Other comprehensive income | — | — | — | 37,571 | 227 | 37,798 | ||||||||||||||||||
Dividend reinvestment | 3 | 149 | — | — | — | 152 | ||||||||||||||||||
Capital stock issued under employee benefit and stock plans | 1,056 | 21,926 | — | — | — | 22,982 | ||||||||||||||||||
Purchase of capital stock | (128 | ) | (4,272 | ) | — | — | — | (4,400 | ) | |||||||||||||||
Cash dividends paid | — | — | (28,180 | ) | — | (66 | ) | (28,246 | ) | |||||||||||||||
Balance as of December 31, | $ | 98,234 | $ | 392,103 | $ | 1,433,093 | $ | (51,433 | ) | $ | 31,307 | $ | 1,903,304 | |||||||||||
2013 | ||||||||||||||||||||||||
Kennametal Shareowners’ Equity | ||||||||||||||||||||||||
(in thousands) | Capital | Additional | Retained | Accumulated | Non- | Total equity | ||||||||||||||||||
stock | paid-in | earnings | other | controlling | ||||||||||||||||||||
capital | comprehensive | interests | ||||||||||||||||||||||
loss | ||||||||||||||||||||||||
Balance as of June 30, 2012 | $ | 100,106 | $ | 447,433 | $ | 1,246,973 | $ | (150,662 | ) | $ | 24,371 | $ | 1,668,221 | |||||||||||
Net income | — | — | 88,532 | — | 1,823 | 90,355 | ||||||||||||||||||
Other comprehensive income | — | — | — | 40,819 | 686 | 41,505 | ||||||||||||||||||
Dividend reinvestment | 4 | 134 | — | — | — | 138 | ||||||||||||||||||
Capital stock issued under employee benefit and stock plans | 415 | 18,601 | — | — | — | 19,016 | ||||||||||||||||||
Purchase of capital stock | (1,587 | ) | (45,029 | ) | — | — | — | (46,616 | ) | |||||||||||||||
Cash dividends paid | — | — | (25,748 | ) | — | (1,949 | ) | (27,697 | ) | |||||||||||||||
Purchase of noncontrolling interests | — | — | — | — | (479 | ) | (479 | ) | ||||||||||||||||
Balance as of December 31, 2012 | $ | 98,938 | $ | 421,139 | $ | 1,309,757 | $ | (109,843 | ) | $ | 24,452 | $ | 1,744,443 | |||||||||||
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Loss (Tables) | 6 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ' | ||||||||||||
Components of, and changes in accumulated other comprehensive loss | ' | ||||||||||||
The components of and changes in AOCL were as follows (net of tax) for the three months ended December 31, 2013: | |||||||||||||
Attributable to Kennametal: | Postretirement benefit plans | Currency translation adjustment | Derivatives | Total | |||||||||
Balance, September 30, 2013 | $ | (85,419 | ) | $ | 35,510 | $ | (12,642 | ) | $ | (62,551 | ) | ||
Other comprehensive loss before | (810 | ) | 11,263 | (273 | ) | 10,180 | |||||||
reclassifications | |||||||||||||
Amounts reclassified from AOCL | 498 | — | 440 | 938 | |||||||||
Net current period other comprehensive | (312 | ) | 11,263 | 167 | 11,118 | ||||||||
loss | |||||||||||||
AOCL, December 31, 2013 | $ | (85,731 | ) | $ | 46,773 | $ | (12,475 | ) | $ | (51,433 | ) | ||
Attributable to noncontrolling interests: | |||||||||||||
Balance, September 30, 2013 | $ | — | $ | 535 | $ | — | $ | 535 | |||||
Other comprehensive loss before | — | 413 | — | 413 | |||||||||
reclassifications | |||||||||||||
Net current period other comprehensive | — | 413 | — | 413 | |||||||||
loss | |||||||||||||
AOCL, December 31, 2013 | $ | — | $ | 948 | $ | — | $ | 948 | |||||
The components of and changes in AOCL were as follows (net of tax) for the six months ended December 31, 2013: | |||||||||||||
Attributable to Kennametal: | Postretirement benefit plans | Currency translation adjustment | Derivatives | Total | |||||||||
Balance, June 30, 2013 | $ | (83,937 | ) | $ | 7,414 | $ | (12,481 | ) | $ | (89,004 | ) | ||
Other comprehensive loss before | (2,776 | ) | 39,359 | (843 | ) | 35,740 | |||||||
reclassifications | |||||||||||||
Amounts reclassified from AOCL | 982 | — | 849 | 1,831 | |||||||||
Net current period other comprehensive | (1,794 | ) | 39,359 | 6 | 37,571 | ||||||||
loss | |||||||||||||
AOCL, December 31, 2013 | $ | (85,731 | ) | $ | 46,773 | $ | (12,475 | ) | $ | (51,433 | ) | ||
Attributable to noncontrolling interests: | |||||||||||||
Balance, June 30, 2013 | $ | — | $ | 721 | $ | — | $ | 721 | |||||
Other comprehensive loss before | — | 227 | — | 227 | |||||||||
reclassifications | |||||||||||||
Net current period other comprehensive | — | 227 | — | 227 | |||||||||
loss | |||||||||||||
AOCL, December 31, 2013 | $ | — | $ | 948 | $ | — | $ | 948 | |||||
Reclassification out of Accumulated Other Comprehensive Loss | ' | ||||||||||||
Reclassifications out of AOCL for the three and six months ended December 31, 2013 consisted of the following: | |||||||||||||
Details about AOCL components | Three months ended December 31, 2013 | Six months ended December 31, 2013 | Affected line item in the Income Statement | ||||||||||
Gains and losses on cash flow hedges: | |||||||||||||
Forward starting interest rate swaps | $ | 486 | $ | 973 | Interest expense | ||||||||
Currency exchange contracts | 224 | 396 | Other expense (income), net | ||||||||||
Total before tax | 710 | 1,369 | |||||||||||
Tax benefit | 270 | 520 | Provision for income taxes | ||||||||||
Net of tax | $ | 440 | $ | 849 | |||||||||
Postretirement benefit plans: | |||||||||||||
Amortization of transition obligations | $ | 20 | $ | 38 | See pension note 10 for further details | ||||||||
Amortization of prior service credit | (86 | ) | (173 | ) | See pension note 10 for further details | ||||||||
Recognition of actuarial losses | 749 | 1,470 | See pension note 10 for further details | ||||||||||
Total before taxes | 683 | 1,335 | |||||||||||
Tax benefit | 185 | 353 | Provision for income taxes | ||||||||||
Net of tax | $ | 498 | $ | 982 | |||||||||
Goodwill_and_Other_Intangible_1
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended | |||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||||||
The carrying amount of goodwill | ' | |||||||||||||||||
A summary of the carrying amount of goodwill attributable to each segment, as well as the changes in such, is as follows: | ||||||||||||||||||
(in thousands) | Industrial | Infrastructure | TMB Acquisition | Total | ||||||||||||||
Goodwill | $ | 273,757 | $ | 598,840 | $ | — | $ | 872,597 | ||||||||||
Accumulated impairment losses | (15,674 | ) | (135,168 | ) | — | (150,842 | ) | |||||||||||
Balance as of June 30, 2013 (1) | $ | 258,083 | $ | 463,672 | $ | — | $ | 721,755 | ||||||||||
Acquisition | $ | — | $ | — | $ | 242,363 | $ | 242,363 | ||||||||||
Translation | 5,209 | 8,317 | — | 13,526 | ||||||||||||||
Change in goodwill | 5,209 | 8,317 | 242,363 | 255,889 | ||||||||||||||
Goodwill | 278,966 | 607,157 | 242,363 | 1,128,486 | ||||||||||||||
Accumulated impairment losses | (15,674 | ) | (135,168 | ) | — | (150,842 | ) | |||||||||||
Balance as of December 31, 2013 | $ | 263,292 | $ | 471,989 | $ | 242,363 | $ | 977,644 | ||||||||||
The components of intangible assets | ' | |||||||||||||||||
The components of our other intangible assets were as follows: | ||||||||||||||||||
Estimated | 31-Dec-13 | 30-Jun-13 | ||||||||||||||||
Useful Life | ||||||||||||||||||
(in thousands) | (in years) | Gross Carrying | Accumulated | Gross Carrying | Accumulated | |||||||||||||
Amount | Amortization | Amount | Amortization | |||||||||||||||
Contract-based | 3 to 15 | $ | 21,842 | $ | (9,421 | ) | $ | 21,450 | $ | (8,374 | ) | |||||||
Technology-based and other | 4 to 20 | 55,317 | (27,606 | ) | 38,005 | (26,006 | ) | |||||||||||
Customer-related | 10 to 20 | 283,460 | (66,880 | ) | 178,318 | (58,148 | ) | |||||||||||
Unpatented technology | 15 to 30 | 63,275 | (11,244 | ) | 45,972 | (9,761 | ) | |||||||||||
Trademarks | 5 to 20 | 19,435 | (10,025 | ) | 14,055 | (9,151 | ) | |||||||||||
Trademarks | Indefinite | 37,428 | — | 36,405 | — | |||||||||||||
Total | $ | 480,757 | $ | (125,176 | ) | $ | 334,205 | $ | (111,440 | ) | ||||||||
Segment_Data_Tables
Segment Data (Tables) | 6 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Sales and operating income by segment and segment assets | ' | |||||||||||||||
Our sales and operating income by segment are as follows: | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in thousands) | 2013 | 2012 (1) | 2013 | 2012 (1) | ||||||||||||
Sales: | ||||||||||||||||
Industrial | $ | 370,647 | $ | 336,007 | $ | 708,876 | $ | 671,201 | ||||||||
Infrastructure | 319,289 | 297,137 | 600,867 | 591,402 | ||||||||||||
Total sales | $ | 689,936 | $ | 633,144 | $ | 1,309,743 | $ | 1,262,603 | ||||||||
Operating income: | ||||||||||||||||
Industrial | $ | 33,218 | $ | 40,677 | $ | 73,038 | $ | 80,004 | ||||||||
Infrastructure | 18,604 | 27,906 | 40,294 | 55,503 | ||||||||||||
Corporate | (2,106 | ) | (2,114 | ) | (4,787 | ) | (4,657 | ) | ||||||||
Total operating income | 49,716 | 66,469 | 108,545 | 130,850 | ||||||||||||
Interest expense | 8,037 | 6,970 | 15,118 | 12,926 | ||||||||||||
Other expense (income), net | 856 | 655 | 1,466 | (246 | ) | |||||||||||
Income from continuing operations before income taxes | $ | 40,823 | $ | 58,844 | $ | 91,961 | $ | 118,170 | ||||||||
(1) Amounts for the three and six months ended December 31, 2012 have been restated to reflect the change in reportable operating segments. | ||||||||||||||||
Segment assets by segment are as follows: | ||||||||||||||||
(in thousands) | 31-Dec-13 | June 30, 2013 (2) | ||||||||||||||
Total assets: | ||||||||||||||||
Industrial | $ | 1,329,156 | $ | 1,190,026 | ||||||||||||
Infrastructure | 1,834,544 | 1,522,470 | ||||||||||||||
Corporate | 402,137 | 588,543 | ||||||||||||||
Goodwill from TMB acquisition | 242,363 | — | ||||||||||||||
Total assets | $ | 3,808,200 | $ | 3,301,039 | ||||||||||||
(2) Amounts as of June 30, 2013 have been restated to reflect the change in reportable operating segments. |
Supplemental_Cash_Flow_Disclos2
Supplemental Cash Flow Disclosures (Details) (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Cash paid during the period for: | ' | ' |
Interest | $14,231 | $11,338 |
Income taxes | 24,868 | 45,072 |
Change in accounts payable related to property plant and equipment | $8,600 | $0 |
Acquisition_Details_1
Acquisition (Details 1) (USD $) | Dec. 31, 2013 | Jun. 30, 2013 |
In Thousands, unless otherwise specified | ||
Assets, Current [Abstract] | ' | ' |
Goodwill | $977,644 | $721,755 |
Allegheny Technologies Incorporated [Member] | ' | ' |
Assets, Current [Abstract] | ' | ' |
Cash and Cash Equivalents | 1,294 | ' |
Accounts Receivables | 41,164 | ' |
Inventory | 98,664 | ' |
Other Current Assets | 4,014 | ' |
Total Current Assets | 145,136 | ' |
Property, Plant, and Equipment | 125,283 | ' |
Goodwill | 242,363 | ' |
Other Intangible Assets | 124,200 | ' |
Deferred Income Taxes | 3,699 | ' |
Other | 1,565 | ' |
Total Assets | 642,246 | ' |
Liabilities, Current [Abstract] | ' | ' |
Accounts Payable | 21,001 | ' |
Accrued payroll | 3,646 | ' |
Deferred Income taxes | 3,563 | ' |
Accrued Expenses | 1,959 | ' |
Current Liabilities | 30,169 | ' |
Accrued pension and postretirement benefits | 88 | ' |
Other Long-Term Liabilities | 5,021 | ' |
Total Liabilities | 35,278 | ' |
Net Assets Acquired | ' | ' |
Net Assets Acquired | $606,968 | ' |
Acquisition_Details_2
Acquisition (Details 2) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Pro forma (unaudited) | ' | ' | ' | ' |
Net Sales | $721,062 | $731,941 | $1,434,250 | $1,468,196 |
Net Income Attributable to Kennametal | $35,934 | $33,112 | $70,778 | $78,239 |
Per share data attributable to Kennametal | ' | ' | ' | ' |
Basic earnings per share (usd per share) | $0.46 | $0.42 | $0.90 | $0.98 |
Diluted earnings per share (in usd per share) | $0.45 | $0.41 | $0.89 | $0.96 |
Acquisition_Details_Textual
Acquisition (Details Textual) (USD $) | 6 Months Ended | 2 Months Ended | 3 Months Ended | 6 Months Ended | 6 Months Ended | 12 Months Ended | 6 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Nov. 04, 2013 | Dec. 31, 2013 | Jun. 30, 2013 | Aug. 01, 2013 | Dec. 31, 2013 | |
Allegheny Technologies Incorporated [Member] | Allegheny Technologies Incorporated [Member] | Allegheny Technologies Incorporated [Member] | Allegheny Technologies Incorporated [Member] | Emura [Member] | Emura [Member] | Emura [Member] | Other Acquisitions [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase Price | ' | ' | ' | ' | ' | $607,000,000 | ' | ' | $40,100,000 | ' |
Payments to Acquire Business | 634,615,000 | 0 | ' | ' | ' | ' | 26,100,000 | 500,000 | ' | ' |
Cash paid for acquisition | ' | ' | ' | ' | ' | ' | 25,600,000 | ' | ' | ' |
Annual Sales | ' | ' | ' | ' | 340,000,000 | ' | ' | ' | ' | ' |
Number of Employees | ' | ' | ' | ' | '1175 | ' | ' | ' | ' | ' |
Business Acquisition number of operating facilities globally | ' | ' | ' | ' | '12 | ' | ' | ' | ' | ' |
Business Acquisition Number of Countries | ' | ' | ' | ' | '7 | ' | ' | ' | ' | ' |
Business Combination, Acquisition Related Costs | ' | ' | ' | 1,700,000 | 2,800,000 | ' | ' | ' | ' | ' |
Goodwill | 242,363,000 | ' | ' | ' | 242,363,000 | ' | ' | ' | ' | ' |
Net Sales | ' | ' | 44,800,000 | ' | ' | ' | ' | ' | ' | ' |
Net Loss Attributable to Kennametal | ' | ' | 7,200,000 | ' | ' | ' | ' | ' | ' | ' |
Integration Related and Restructuring Related Expenses | ' | ' | ' | 4,500,000 | 9,000,000 | ' | ' | ' | ' | ' |
Integration Related and Restructuring Related Expenses | ' | ' | ' | 4,500,000 | 9,000,000 | ' | ' | ' | ' | ' |
Acquisition Related Pre-Tax Cost | ' | ' | ' | 1,700,000 | 2,800,000 | ' | ' | ' | ' | ' |
Business Combination, Contingent Consideration, Liability | 14,000,000 | ' | ' | ' | ' | ' | ' | ' | 14,000,000 | ' |
Immaterial Acquisition, Acquisition Cost | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2,000,000 |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Dec. 31, 2013 | Jun. 30, 2013 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Derivatives Assets | $129 | $775 |
Total assets at fair value | 129 | 775 |
Derivatives Liabilities | 1,227 | 530 |
Contingent Consideration | 14,000 | ' |
Total liabilities at fair value | 15,227 | 530 |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Derivatives Assets | 129 | 775 |
Total assets at fair value | 129 | 775 |
Derivatives Liabilities | 1,227 | 530 |
Total liabilities at fair value | 1,227 | 530 |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Contingent Consideration | 14,000 | ' |
Total liabilities at fair value | $14,000 | ' |
Fair_Value_Measurements_Detail1
Fair Value Measurements (Details Textual) (Fair Value, Measurements, Recurring [Member], Level 3 [Member]) | 3 Months Ended |
Dec. 31, 2013 | |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Period Over which Contingent Consideration is Payable | '3 years |
Derivative_Instruments_and_Hed2
Derivative Instruments and Hedging Activities (Details) (USD $) | Dec. 31, 2013 | Jun. 30, 2013 |
In Thousands, unless otherwise specified | ||
Fair value of derivatives | ' | ' |
Derivative Assets (Liabilities) at Fair Value, Net | ($1,098) | $245 |
Designated as Hedging Instrument [Member] | ' | ' |
Fair value of derivatives | ' | ' |
Derivative Assets (Liabilities) at Fair Value, Net | -1,022 | 205 |
Not Designated as Hedging Instrument [Member] | ' | ' |
Fair value of derivatives | ' | ' |
Derivative Assets (Liabilities) at Fair Value, Net | -76 | 40 |
Range Forward Contracts [Member] | Designated as Hedging Instrument [Member] | Other Current Assets [Member] | ' | ' |
Fair value of derivatives | ' | ' |
Derivative assets designated as hedging instruments | 73 | 658 |
Range Forward Contracts [Member] | Designated as Hedging Instrument [Member] | Other Current Liabilities [Member] | ' | ' |
Fair value of derivatives | ' | ' |
Derivative liabilities designated as hedging instruments | -1,095 | -522 |
Range Forward Contracts [Member] | Designated as Hedging Instrument [Member] | Other Assets [Member] | ' | ' |
Fair value of derivatives | ' | ' |
Derivative assets designated as hedging instruments | 0 | 69 |
Currency Forward Contracts [Member] | Not Designated as Hedging Instrument [Member] | Other Current Assets [Member] | ' | ' |
Fair value of derivatives | ' | ' |
Derivative assets designated as hedging instruments | 56 | 48 |
Currency Forward Contracts [Member] | Not Designated as Hedging Instrument [Member] | Other Current Liabilities [Member] | ' | ' |
Fair value of derivatives | ' | ' |
Derivative liabilities designated as hedging instruments | ($132) | ($8) |
Derivative_Instruments_and_Hed3
Derivative Instruments and Hedging Activities (Details 1) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Currency Forward Contracts [Member] | Other Expense Income Net [Member] | Not Designated as Hedging Instrument [Member] | ' | ' | ' | ' |
Derivative Instruments, (Gain )Loss Recognized in Income, Net | ' | ' | ' | ' |
Other expense (income), net - currency forward contracts | $72 | $261 | $114 | $1,470 |
Range Forward Contracts [Member] | Cash flow hedging [Member] | ' | ' | ' | ' |
(Gains) losses related to cash flow hedges | ' | ' | ' | ' |
Losses recognized in other comprehensive loss, net | -273 | -102 | -843 | -673 |
Losses reclassified from accumulated other comprehensive loss into other expense (income), net | $324 | $298 | $714 | $257 |
Derivative_Instruments_and_Hed4
Derivative Instruments and Hedging Activities (Details Textual) (USD $) | 1 Months Ended | 6 Months Ended | ||||
In Millions, unless otherwise specified | Feb. 28, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 14, 2012 | Dec. 31, 2013 | Jun. 30, 2013 |
Forward Starting Interest Rate Swap Contracts [Member] | Contracts translated to US dollars [Member] | Contracts translated to US dollars [Member] | ||||
Additional Derivative Instruments and Hedging Activities (Textual) [Abstract] | ' | ' | ' | ' | ' | ' |
Notional amount of the contracts translated into U.S. dollars | ' | ' | ' | ' | $60.80 | $102.20 |
Notional amount of the contracts translated into U.S. dollars | ' | ' | ' | 150 | ' | ' |
Derivative Instruments and Hedging Activities (Textual) [Abstract] | ' | ' | ' | ' | ' | ' |
Recognize loss on outstanding derivatives in the next 12 months | ' | 0.8 | ' | ' | ' | ' |
Gains or losses recognized in earnings due to ineffectiveness and excluded from effectiveness testing | ' | 0 | 0 | ' | ' | ' |
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ' | ' | ' | ' | ' | ' |
Payments for derivative hedging instrument upon settlement | $22.40 | ' | ' | ' | ' | ' |
Derivative_Instruments_and_Hed5
Derivative Instruments and Hedging Activities (Details Textual 1) (Forward Starting Interest Rate Swap Contracts [Member], USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Forward Starting Interest Rate Swap Contracts [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Interest expense | $0.50 | $0.50 | $1 | $0.90 |
Restructuring_Details
Restructuring (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Restructuring Reserve [Abstract] | ' | ' | ' | ' |
Beginning Balance | ' | ' | $0 | ' |
Expense | 2,310 | 0 | 2,310 | 0 |
Translation | ' | ' | 10 | ' |
Cash Expenditures | ' | ' | -1,519 | ' |
Ending Balance | 801 | ' | 801 | ' |
Industrial [Member] | ' | ' | ' | ' |
Restructuring Reserve [Abstract] | ' | ' | ' | ' |
Beginning Balance | ' | ' | 0 | ' |
Expense | ' | ' | 1,085 | ' |
Translation | ' | ' | 1 | ' |
Cash Expenditures | ' | ' | -984 | ' |
Ending Balance | 102 | ' | 102 | ' |
Industrial [Member] | Severance [Member] | ' | ' | ' | ' |
Restructuring Reserve [Abstract] | ' | ' | ' | ' |
Beginning Balance | ' | ' | 0 | ' |
Expense | ' | ' | 1,085 | ' |
Translation | ' | ' | 1 | ' |
Cash Expenditures | ' | ' | -984 | ' |
Ending Balance | 102 | ' | 102 | ' |
Infrastructure [Member] | ' | ' | ' | ' |
Restructuring Reserve [Abstract] | ' | ' | ' | ' |
Beginning Balance | ' | ' | 0 | ' |
Expense | ' | ' | 1,225 | ' |
Translation | ' | ' | 9 | ' |
Cash Expenditures | ' | ' | -535 | ' |
Ending Balance | 699 | ' | 699 | ' |
Infrastructure [Member] | Severance [Member] | ' | ' | ' | ' |
Restructuring Reserve [Abstract] | ' | ' | ' | ' |
Beginning Balance | ' | ' | 0 | ' |
Expense | ' | ' | 1,225 | ' |
Translation | ' | ' | 9 | ' |
Cash Expenditures | ' | ' | -535 | ' |
Ending Balance | $699 | ' | $699 | ' |
Restructuring_Details_Textual
Restructuring (Details Textual) (USD $) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' |
Restructuring Charges | $2,310,000 | $0 | $2,310,000 | $0 |
Minimum [Member] | ' | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' |
Restructuring and Related Cost, Expected Cost | ' | ' | 40,000,000 | ' |
Maximum [Member] | ' | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' |
Restructuring and Related Cost, Expected Cost | ' | ' | $50,000,000 | ' |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (Stock Option [Member]) | 6 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | |||
Stock Option [Member] | ' | ' | ||
Assumptions used in valuation of stock options | ' | ' | ||
Risk-free interest rate | 1.30% | 0.60% | ||
Expected life (years) | '4 years 6 months | [1] | '4 years 6 months | [1] |
Expected volatility | 40.40% | [2] | 49.50% | [2] |
Expected dividend yield | 1.50% | 1.40% | ||
[1] | Expected life is derived from historical experience. | |||
[2] | Expected volatility is based on the implied historical volatility of our stock. |
StockBased_Compensation_Detail1
Stock-Based Compensation (Details 1) (USD $) | 6 Months Ended |
Dec. 31, 2013 | |
Changes in stock options | ' |
Options outstanding, June 30, 2013 | 2,729,068 |
Options, Granted | 342,662 |
Options, Exercised | -479,164 |
Options, Lapsed and Forfeited | -14,836 |
Options outstanding, December 31, 2013 | 2,577,730 |
Options vested and expected to vest, December 31, 2013 | 2,535,445 |
Options exercisable, December 31, 2013 | 1,759,651 |
Weighted Average Exercise Price, Options outstanding, June 30, 2013 | $30.40 |
Weighted Average Exercise Price, Granted | $45.24 |
Weighted Average Exercise Price, Exercised | $26.25 |
Weighted Average Exercise Price, Lapsed and Forfeited | $38.68 |
Weighted Average Exercise Price, Options outstanding, December 31, 2013 | $33.10 |
Weighted Average Exercise Price, Option vested and expected to vest, December 31, 2013 | $32.97 |
Weighted Average Exercise Price, Options exercisable, December 31, 2013 | $30.14 |
Weighted Average Remaining Life, Options outstanding, December 31, 2013 | '5 years 9 months 18 days |
Weighted Average Remaining Life, Options vested and expected to vest, December 31, 2013 | '5 years 9 months 18 days |
Weighted Average Remaining Life, Options exercisable, December 31, 2013 | '4 years 7 months 6 days |
Aggregate Intrinsic value, Options outstanding, December 31, 2013 | $48,899 |
Aggregate Intrinsic Value, Options vested and expected to vest, December 31, 2013 | 48,439 |
Aggregate Intrinsic Value, Options exercisable, December 31, 2013 | $38,586 |
StockBased_Compensation_Detail2
Stock-Based Compensation (Details 2) (USD $) | 6 Months Ended |
Dec. 31, 2013 | |
Restricted Stock Units - Performance Vesting [Member] | ' |
Changes in restricted stock awards | ' |
Unvested restricted stock awards, June 30, 2013, Shares | 367,612 |
Granted, Shares | 82,449 |
Vested, Shares | -156,798 |
Performance Metric Not Achieved, Shares | -95,907 |
Forfeited, Shares | 0 |
Unvested restricted stock awards, December 31, 2013 | 197,356 |
Weighted Average Fair Value, Unvested restricted stock awards, June 30, 2013 | $32.08 |
Weighted Average Fair Value, Granted | $45.24 |
Weighted Average Fair Value, Vested | $26.89 |
Weighted Average Fair Value, Performance Metric Not Achieved | $45.24 |
Weighted Average Fair Value, Forfeited | $0 |
Weighted Average Fair Value, Unvested restricted stock awards, December 31, 2013 | $40.92 |
Restricted Stock Units - Time Vesting [Member] | ' |
Changes in restricted stock awards | ' |
Unvested restricted stock awards, June 30, 2013, Shares | 815,210 |
Granted, Shares | 305,501 |
Vested, Shares | -297,811 |
Forfeited, Shares | -31,705 |
Unvested restricted stock awards, December 31, 2013 | 791,195 |
Weighted Average Fair Value, Unvested restricted stock awards, June 30, 2013 | $34.53 |
Weighted Average Fair Value, Granted | $45.17 |
Weighted Average Fair Value, Vested | $32.44 |
Weighted Average Fair Value, Forfeited | $39.54 |
Weighted Average Fair Value, Unvested restricted stock awards, December 31, 2013 | $39.23 |
StockBased_Compensation_Detail3
Stock-Based Compensation (Details Textual) (USD $) | 6 Months Ended | |
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Stock-Based Compensation (Additional Textual) [Abstract] | ' | ' |
Maximum period of achievement of performance goals to earn performance units | '3 years | ' |
Minimum performance period of individual required to earn performance units | '3 years | ' |
Stock Option [Member] | ' | ' |
Stock-Based Compensation (Textual) [Abstract] | ' | ' |
Compensation expense related to stock option | $3.50 | $4 |
Unrecognized compensation cost | 4 | ' |
Unrecognized compensation costs, weighted average period | '2 years 9 months 18 days | ' |
Weighted average fair value of options granted | $13.79 | $13.52 |
Fair value of options vested | 5 | 5.1 |
Tax benefits resulting from stock-based compensation deductions in excess of amounts reported for financial reporting purposes | 4.5 | 1.1 |
Cash received from the exercise of capital stock option | 12.7 | 3.8 |
Tax benefit from the exercise of capital stock option | 2.7 | 0.8 |
Total Intrinsic value of options exercised | 9.2 | 2.5 |
Fair Market Value of Shares Delivered | 0.2 | ' |
Restricted Stock Units - Time Vesting Performance Vesting [Member] | ' | ' |
Stock-Based Compensation (Textual) [Abstract] | ' | ' |
Compensation expense related to stock option | 8.4 | 11.4 |
Unrecognized compensation cost | $20.10 | ' |
Unrecognized compensation costs, weighted average period | '2 years 7 months 6 days | ' |
Benefit_Plans_Details
Benefit Plans (Details) (Pension plans contribution [Member], USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Pension plans contribution [Member] | ' | ' | ' | ' |
Net periodic pension cost | ' | ' | ' | ' |
Service cost | $1,732 | $1,956 | $3,448 | $3,908 |
Interest cost | 10,308 | 9,601 | 20,484 | 19,182 |
Expected return on plan assets | -14,916 | -14,074 | -29,712 | -28,152 |
Amortization of transition obligation | 20 | 18 | 38 | 36 |
Amortization of prior service credit | -58 | -48 | -117 | -97 |
Recognition of actuarial losses | 670 | 3,752 | 1,312 | 7,499 |
Net periodic pension cost | ($2,244) | $1,205 | ($4,547) | $2,376 |
Benefit_Plans_Details_1
Benefit Plans (Details 1) (Other postretirement benefit plans [Member], USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Other postretirement benefit plans [Member] | ' | ' | ' | ' |
Net periodic other postretirement benefit costs | ' | ' | ' | ' |
Service cost | $14 | $18 | $28 | $36 |
Interest cost | 251 | 234 | 502 | 469 |
Amortization of prior service credit | -28 | -28 | -56 | -55 |
Recognition of actuarial loss (gains) | 79 | 104 | 158 | 208 |
Net periodic pension cost | $316 | $328 | $632 | $658 |
Inventories_Details
Inventories (Details) (USD $) | Dec. 31, 2013 | Jun. 30, 2013 |
In Thousands, unless otherwise specified | ||
Inventories | ' | ' |
Finished goods | $378,940 | $303,307 |
Work in process and powder blends | 299,254 | 244,180 |
Raw materials | 152,981 | 137,602 |
Inventories at current cost | 831,175 | 685,089 |
Less: LIFO valuation | -100,497 | -106,294 |
Total inventories | $730,678 | $578,795 |
Inventories (Textual) [Abstract] | ' | ' |
Percentage of inventories valued by using LIFO method | 46.00% | 52.00% |
Long_Term_Debt_Details_Textual
Long -Term Debt (Details Textual) (USD $) | Dec. 31, 2013 | Jun. 30, 2013 | Oct. 21, 2011 |
In Millions, unless otherwise specified | |||
Long-Term Debt and Capital Leases (Additional Textual) [Abstract] | ' | ' | ' |
Fixed rate at fair market value | $680.30 | $680.10 | ' |
2011 Credit Agreement [Member] | ' | ' | ' |
Long-Term Debt and Capital Leases (Textual) [Abstract] | ' | ' | ' |
Borrowing outstanding under 2011 Credit Agreement | 360.7 | 3.6 | ' |
Line of Credit Facility, Maximum Borrowing Capacity | ' | ' | $600 |
Environmental_Matters_Details_
Environmental Matters (Details Textual) (USD $) | Dec. 31, 2013 | Jun. 30, 2013 |
In Millions, unless otherwise specified | ||
Environmental Matters (Textual) [Abstract] | ' | ' |
Reserves for environmental costs | $5.20 | $5.10 |
Income_Taxes_Details_Textual
Income Taxes (Details Textual) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax (Textual) [Abstract] | ' | ' | ' | ' |
Effective tax rate | 40.80% | 26.40% | 31.80% | 23.50% |
Current Year Income Tax Expense Related To Repatriation Of Overseas Cash | $7.20 | ' | $7.20 | ' |
Repatriation Of Foreign Cash | $57 | ' | $57 | ' |
Earnings_Per_Shares_Details
Earnings Per Shares (Details) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Earnings Per Share (Textual) [Abstract] | ' | ' | ' | ' |
Increase in weighted average shares due to dilutive effect of unexercised capital stock options, unvested restricted stock awards and unvested restricted stock units | 1 | 1.3 | 1 | 1.2 |
Unexercised capital stock options, restricted stock units and restricted stock awards excluded from computation of diluted EPS | 0.2 | 0.9 | 0.3 | 1 |
Equity_Details
Equity (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Beginning Balance | ' | ' | $1,812,293 | $1,668,221 |
Net income | 24,167 | 43,309 | 62,725 | 90,355 |
Other comprehensive income (loss) | ' | ' | 37,798 | 41,505 |
Dividend reinvestment | ' | ' | 152 | 138 |
Capital stock issued under employee benefit and stock plans | ' | ' | 22,982 | 19,016 |
Purchase of capital stock | ' | ' | -4,400 | -46,616 |
Cash dividends paid | ' | ' | -28,246 | -27,697 |
Ending Balance | 1,903,304 | 1,744,443 | 1,903,304 | 1,744,443 |
Noncontrolling interest acquired | ' | ' | ' | -479 |
Capital stock [Member] | ' | ' | ' | ' |
Beginning Balance | ' | ' | 97,303 | 100,106 |
Dividend reinvestment | ' | ' | 3 | 4 |
Capital stock issued under employee benefit and stock plans | ' | ' | 1,056 | 415 |
Purchase of capital stock | ' | ' | -128 | -1,587 |
Ending Balance | 98,234 | 98,938 | 98,234 | 98,938 |
Additional paid-in capital [Member] | ' | ' | ' | ' |
Beginning Balance | ' | ' | 374,300 | 447,433 |
Dividend reinvestment | ' | ' | 149 | 134 |
Capital stock issued under employee benefit and stock plans | ' | ' | 21,926 | 18,601 |
Purchase of capital stock | ' | ' | -4,272 | -45,029 |
Ending Balance | 392,103 | 421,139 | 392,103 | 421,139 |
Retained earnings [Member] | ' | ' | ' | ' |
Beginning Balance | ' | ' | 1,399,227 | 1,246,973 |
Net income | ' | ' | 62,046 | 88,532 |
Cash dividends paid | ' | ' | -28,180 | -25,748 |
Ending Balance | 1,433,093 | 1,309,757 | 1,433,093 | 1,309,757 |
Accumulated other comprehensive income (loss) [Member] | ' | ' | ' | ' |
Beginning Balance | ' | ' | -89,004 | -150,662 |
Other comprehensive income (loss) | ' | ' | 37,571 | 40,819 |
Ending Balance | -51,433 | -109,843 | -51,433 | -109,843 |
Non-controlling interest [Member] | ' | ' | ' | ' |
Beginning Balance | ' | ' | 30,467 | 24,371 |
Net income | ' | ' | 679 | 1,823 |
Other comprehensive income (loss) | 413 | ' | 227 | 686 |
Cash dividends paid | ' | ' | -66 | -1,949 |
Ending Balance | 31,307 | 24,452 | 31,307 | 24,452 |
Noncontrolling interest acquired | ' | ' | ' | ($479) |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Loss (Details 1) (USD $) | 3 Months Ended | 6 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | ($62,551) | ($89,004) | ' |
Net current period other comprehensive loss | 11,118 | 37,571 | ' |
Other comprehensive loss before reclassifications | 10,180 | 35,740 | ' |
Amounts reclassified from accumulated other comprehensive loss | 938 | 1,831 | ' |
Net current period other comprehensive loss | ' | 37,798 | 41,505 |
Accumulated Other Comprehensive Income (Loss), Net of Tax | -51,433 | -51,433 | ' |
Accumulated Defined Benefit Plans Adjustment [Member] | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | -85,419 | -83,937 | ' |
Net current period other comprehensive loss | -312 | -1,794 | ' |
Other comprehensive loss before reclassifications | -810 | -2,776 | ' |
Amounts reclassified from accumulated other comprehensive loss | 498 | 982 | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | -85,731 | -85,731 | ' |
Accumulated Translation Adjustment [Member] | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 35,510 | 7,414 | ' |
Net current period other comprehensive loss | 11,263 | 39,359 | ' |
Other comprehensive loss before reclassifications | 11,263 | 39,359 | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 46,773 | 46,773 | ' |
Accumulated translation adjustment relating to noncontrolling interest [Member] | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 535 | 721 | ' |
Other comprehensive loss before reclassifications | 413 | 227 | ' |
Net current period other comprehensive loss | 413 | 227 | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 948 | 948 | ' |
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | -12,642 | -12,481 | ' |
Net current period other comprehensive loss | 167 | 6 | ' |
Other comprehensive loss before reclassifications | -273 | -843 | ' |
Amounts reclassified from accumulated other comprehensive loss | 440 | 849 | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | -12,475 | -12,475 | ' |
Noncontrolling Interest [Member] | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 535 | 721 | ' |
Other comprehensive loss before reclassifications | 413 | 227 | ' |
Net current period other comprehensive loss | 413 | 227 | 686 |
Accumulated Other Comprehensive Income (Loss), Net of Tax | $948 | $948 | ' |
Accumulated_Other_Comprehensiv3
Accumulated Other Comprehensive Loss (Details 2) (USD $) | 3 Months Ended | 6 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Jun. 30, 2013 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | ($51,433) | ($51,433) | ' | ($62,551) | ($89,004) |
Other comprehensive loss before reclassifications | 10,180 | 35,740 | ' | ' | ' |
Net current period other comprehensive loss | ' | 37,798 | 41,505 | ' | ' |
Amounts reclassified from accumulated other comprehensive loss | 938 | 1,831 | ' | ' | ' |
Net current period other comprehensive loss | 11,118 | 37,571 | ' | ' | ' |
Accumulated Defined Benefit Plans Adjustment [Member] | ' | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | -85,731 | -85,731 | ' | -85,419 | -83,937 |
Other comprehensive loss before reclassifications | -810 | -2,776 | ' | ' | ' |
Amounts reclassified from accumulated other comprehensive loss | 498 | 982 | ' | ' | ' |
Net current period other comprehensive loss | -312 | -1,794 | ' | ' | ' |
Accumulated Translation Adjustment [Member] | ' | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 46,773 | 46,773 | ' | 35,510 | 7,414 |
Other comprehensive loss before reclassifications | 11,263 | 39,359 | ' | ' | ' |
Net current period other comprehensive loss | 11,263 | 39,359 | ' | ' | ' |
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ' | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | -12,475 | -12,475 | ' | -12,642 | -12,481 |
Other comprehensive loss before reclassifications | -273 | -843 | ' | ' | ' |
Amounts reclassified from accumulated other comprehensive loss | 440 | 849 | ' | ' | ' |
Net current period other comprehensive loss | 167 | 6 | ' | ' | ' |
Accumulated translation adjustment relating to noncontrolling interest [Member] | ' | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 948 | 948 | ' | 535 | 721 |
Other comprehensive loss before reclassifications | 413 | 227 | ' | ' | ' |
Net current period other comprehensive loss | 413 | 227 | ' | ' | ' |
Noncontrolling Interest [Member] | ' | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' | ' | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 948 | 948 | ' | 535 | 721 |
Other comprehensive loss before reclassifications | 413 | 227 | ' | ' | ' |
Net current period other comprehensive loss | $413 | $227 | $686 | ' | ' |
Accumulated_Other_Comprehensiv4
Accumulated Other Comprehensive Loss (Details 3) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ' | ' | ' | ' |
Loss on currency exchange contracts reclassified from accumulated other comprehensive loss into other expense (income), net | ($856) | ($655) | ($1,466) | $246 |
Income tax benefit relating to reclassification out of accumulated other comprehensive loss | 16,656 | 15,535 | 29,236 | 27,815 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ' | ' | ' | ' |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ' | ' | ' | ' |
Total before tax | 710 | ' | 1,369 | ' |
Income tax benefit relating to reclassification out of accumulated other comprehensive loss | 270 | ' | 520 | ' |
Net of tax | 440 | ' | 849 | ' |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Accumulated Defined Benefit Plans Adjustment [Member] | ' | ' | ' | ' |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ' | ' | ' | ' |
Reclassification out of accumulated other comprehensive loss, pension and other postretirement benefit plans, amortization of transition obligations | 20 | ' | 38 | ' |
Reclassification out of accumulated other comprehensive loss, Pension and Other Postretirement Benefit Plans, for amortization of prior service credit | -86 | ' | -173 | ' |
Reclassification out of accumulated other comprehensive loss, Pension and Other Postretirement Benefit Plans, for actuarial losses | 749 | ' | 1,470 | ' |
Total before tax | 683 | ' | 1,335 | ' |
Income tax benefit relating to reclassification out of accumulated other comprehensive loss | 185 | ' | 353 | ' |
Net of tax | 498 | ' | 982 | ' |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Forward Starting Interest Rate Swap Contracts [Member] | Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ' | ' | ' | ' |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ' | ' | ' | ' |
Loss on forward starting interest rate swap contracts reclassfied from accumulated other comprehensive loss to interest expense | 486 | ' | 973 | ' |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Currency Forward Contracts [Member] | Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ' | ' | ' | ' |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ' | ' | ' | ' |
Loss on currency exchange contracts reclassified from accumulated other comprehensive loss into other expense (income), net | $224 | ' | $396 | ' |
Goodwill_and_Other_Intangible_2
Goodwill and Other Intangible Assets (Details) (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Jun. 30, 2013 |
Goodwill [Roll Forward] | ' | ' |
Goodwill | $1,128,486 | $872,597 |
Accumulated impairment losses | -150,842 | -150,842 |
Goodwill, Beginning Balance | 721,755 | ' |
Goodwill from TMB acquisition | 242,363 | ' |
Translation | 13,526 | ' |
Change in goodwill | 255,889 | ' |
Goodwill, Ending Balance | 977,644 | ' |
Allegheny Technologies Incorporated [Member] | ' | ' |
Goodwill [Roll Forward] | ' | ' |
Goodwill | 242,363 | ' |
Goodwill from TMB acquisition | 242,363 | ' |
Change in goodwill | 242,363 | ' |
Goodwill, Ending Balance | 242,363 | ' |
Industrial [Member] | ' | ' |
Goodwill [Roll Forward] | ' | ' |
Goodwill | 278,966 | 273,757 |
Accumulated impairment losses | -15,674 | -15,674 |
Goodwill, Beginning Balance | 258,083 | ' |
Goodwill from TMB acquisition | 0 | ' |
Translation | 5,209 | ' |
Change in goodwill | 5,209 | ' |
Goodwill, Ending Balance | 263,292 | ' |
Infrastructure [Member] | ' | ' |
Goodwill [Roll Forward] | ' | ' |
Goodwill | 607,157 | 598,840 |
Accumulated impairment losses | -135,168 | -135,168 |
Goodwill, Beginning Balance | 463,672 | ' |
Goodwill from TMB acquisition | 0 | ' |
Translation | 8,317 | ' |
Change in goodwill | 8,317 | ' |
Goodwill, Ending Balance | $471,989 | ' |
Goodwill_and_Other_Intangible_3
Goodwill and Other Intangible Assets (Details 1) (USD $) | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | Trademarks [Member] | Trademarks [Member] | Contract-based [Member] | Contract-based [Member] | Technology-based and other [Member] | Technology-based and other [Member] | Customer Relationships [Member] | Customer Relationships [Member] | Unpatented technology [Member] | Unpatented technology [Member] | Trademarks [Member] | Trademarks [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | ||
Contract-based [Member] | Technology-based and other [Member] | Customer Relationships [Member] | Unpatented technology [Member] | Trademarks [Member] | Contract-based [Member] | Technology-based and other [Member] | Customer Relationships [Member] | Unpatented technology [Member] | Trademarks [Member] | |||||||||||||||
The components of intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Useful life related to technology-based intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | '4 years | '10 years | '15 years | '5 years | '15 years | '20 years | '20 years | '30 years | '20 years |
Gross carrying amount, finite | ' | ' | ' | ' | $21,842 | $21,450 | $55,317 | $38,005 | $283,460 | $178,318 | $63,275 | $45,972 | $19,435 | $14,055 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accumulated amortization | -125,176 | -111,440 | ' | ' | -9,421 | -8,374 | -27,606 | -26,006 | -66,880 | -58,148 | -11,244 | -9,761 | -10,025 | -9,151 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross carrying amount, Indefinite | ' | ' | 37,428 | 36,405 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross carrying amount, total | $480,757 | $334,205 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill_and_Other_Intangible_4
Goodwill and Other Intangible Assets (Details Textual) (USD $) | 3 Months Ended | 6 Months Ended | 6 Months Ended | 6 Months Ended | |||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Aug. 01, 2013 | Dec. 31, 2013 | Nov. 04, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
Infrastructure [Member] | Emura [Member] | Allegheny Technologies Incorporated [Member] | Allegheny Technologies Incorporated [Member] | Technology-Based and other [Member] | Contract-based [Member] | Trademarks [Member] | |||||
Emura [Member] | Emura [Member] | Emura [Member] | |||||||||
Goodwill and Other Intangible Assets (Additional Textual) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization expense for intangible assets | $6,524,000 | $5,200,000 | $11,667,000 | $10,307,000 | ' | ' | ' | ' | ' | ' | ' |
Favorable foreign currency translation adjustment | ' | ' | 3,800,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in Other Intangible Assets | ' | ' | ' | ' | ' | 16,000,000 | ' | 124,200,000 | ' | ' | ' |
Estimated Annual Amortization Expense From Acquired Intangibles | ' | ' | ' | ' | ' | ' | 8,000,000 | ' | ' | ' | ' |
Finite-lived Intangible Assets Acquired | ' | ' | ' | ' | ' | ' | ' | ' | 15,500,000 | 400,000 | 100,000 |
Finite-Lived Intangible Asset, Useful Life | ' | ' | ' | ' | ' | ' | ' | ' | '20 years | '3 years | '20 years |
Goodwill, Period Increase (Decrease) | ' | ' | $255,889,000 | ' | $8,317,000 | ' | $242,363,000 | ' | ' | ' | ' |
Segment_Data_Details
Segment Data (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
External sales: | ' | ' | ' | ' |
Total sales | $689,936 | $633,144 | $1,309,743 | $1,262,603 |
Operating income: | ' | ' | ' | ' |
Total operating income | 49,716 | 66,469 | 108,545 | 130,850 |
Interest expense | 8,037 | 6,970 | 15,118 | 12,926 |
Other expense (income), net | 856 | 655 | 1,466 | -246 |
Income before income taxes | 40,823 | 58,844 | 91,961 | 118,170 |
Industrial [Member] | ' | ' | ' | ' |
External sales: | ' | ' | ' | ' |
Total sales | 370,647 | 336,007 | 708,876 | 671,201 |
Operating income: | ' | ' | ' | ' |
Total operating income | 33,218 | 40,677 | 73,038 | 80,004 |
Infrastructure [Member] | ' | ' | ' | ' |
External sales: | ' | ' | ' | ' |
Total sales | 319,289 | 297,137 | 600,867 | 591,402 |
Operating income: | ' | ' | ' | ' |
Total operating income | 18,604 | 27,906 | 40,294 | 55,503 |
Corporate [Member] | ' | ' | ' | ' |
Operating income: | ' | ' | ' | ' |
Total operating income | ($2,106) | ($2,114) | ($4,787) | ($4,657) |
Segment_Data_Details_1
Segment Data (Details 1) (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Jun. 30, 2013 |
Segment Reporting Information [Line Items] | ' | ' |
Segment Assets | $3,808,200 | $3,301,039 |
Goodwill from TMB acquisition | 242,363 | ' |
Allegheny Technologies Incorporated [Member] | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Goodwill from TMB acquisition | 242,363 | ' |
Industrial [Member] | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Segment Assets | 1,329,156 | 1,190,026 |
Goodwill from TMB acquisition | 0 | ' |
Infrastructure [Member] | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Segment Assets | 1,834,544 | 1,522,470 |
Goodwill from TMB acquisition | 0 | ' |
Corporate Segment [Member] | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Segment Assets | $402,137 | $588,543 |