Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Dec. 31, 2014 | Jan. 30, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | KENNAMETAL INC. | |
Entity Central Index Key | 55242 | |
Current Fiscal Year End Date | -24 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | 31-Dec-14 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | FALSE | |
Entity Common Stock, Shares Outstanding | 79,162,006 |
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, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Income Statement [Abstract] | ||||
Sales | $675,631 | $689,936 | $1,370,572 | $1,309,743 |
Cost of goods sold | 476,173 | 482,965 | 953,015 | 904,536 |
Gross profit | 199,458 | 206,971 | 417,557 | 405,207 |
Operating expense | 137,459 | 148,421 | 285,947 | 282,685 |
Restructuring and asset impairment charges (Notes 8 and 18) | 388,839 | 2,310 | 390,402 | 2,310 |
Amortization of intangibles | 6,931 | 6,524 | 13,959 | 11,667 |
Operating (loss) income | -333,771 | 49,716 | -272,751 | 108,545 |
Interest expense | 7,960 | 8,037 | 16,170 | 15,118 |
Other expense, net | 2,223 | 856 | 409 | 1,466 |
(Loss) income before income taxes | -343,954 | 40,823 | -289,330 | 91,961 |
Provision for income taxes | 43,751 | 16,656 | 58,248 | 29,236 |
Net (loss) income | -387,705 | 24,167 | -347,578 | 62,725 |
Less: Net (loss) income attributable to noncontrolling interests | 597 | -42 | 1,236 | 679 |
Net (loss) income attributable to Kennametal | ($388,302) | $24,209 | ($348,814) | $62,046 |
PER SHARE DATA ATTRIBUTABLE TO KENNAMETAL SHAREHOLDERS | ||||
Basic (loss) earnings per share | ($4.89) | $0.31 | ($4.40) | $0.79 |
Diluted (loss) earnings per share | ($4.89) | $0.30 | ($4.40) | $0.78 |
Dividends per share | $0.18 | $0.18 | $0.36 | $0.36 |
Basic weighted average shares outstanding | 79,343 | 78,729 | 79,229 | 78,587 |
Diluted weighted average shares outstanding | 79,343 | 79,776 | 79,229 | 79,597 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Statement of Comprehensive Income [Abstract] | ||||
Net (loss) income | ($387,705) | $24,167 | ($347,578) | $62,725 |
Unrealized gain (loss) on derivatives designated and qualified as cash flow hedges, net of income tax expense (benefit) of $0.8 million, ($0.2) million, $1.7 million and ($0.5) million, respectively | 1,206 | -273 | 2,713 | -843 |
Reclassification of unrealized (gain) loss on expired derivatives designated and qualified as cash flow hedges, net of income tax (expense) benefit of ($0.0) million, $0.3 million, $0.2 million and $0.5 million, respectively | -35 | 440 | 329 | 849 |
Unrecognized net pension and other postretirement benefit gain (loss), net of income tax expense (benefit) of $0.7 million, ($0.3) million, $2.0 million and ($1.0) million, respectively | 1,924 | -810 | 5,565 | -2,776 |
Reclassification of net pension and other postretirement benefit loss, net of income tax benefit of $0.3 million, $0.2 million, $0.7 million and $0.4 million, respectively | 735 | 498 | 1,489 | 982 |
Foreign currency translation adjustments, net of income tax (benefit) expense of ($1.5) million, $0.7 million, ($4.8) million and $2.1 million, respectively | -30,209 | 11,675 | -81,722 | 39,586 |
Total comprehensive (loss) income | -414,084 | 35,697 | -419,204 | 100,523 |
Comprehensive (loss) income attributable to noncontrolling interests | -184 | 371 | -1,037 | 906 |
Comprehensive (loss) income attributable to Kennametal Shareholders | ($413,900) | $35,326 | ($418,167) | $99,617 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Unrealized gain (loss) on derivatives designated and qualified as cash flow hedges, Tax expense (benefit) | $0.80 | ($0.20) | $1.70 | ($0.50) |
Reclassification of unrealized loss on expired derivatives designated and qualified as cash flow hedges, Tax benefit | 0 | 0.3 | 0.2 | 0.5 |
Unrecognized net pension and other postretirement benefit gain (loss), Tax expense (benefit) | 0.7 | -0.3 | 2 | -1 |
Reclassification of net pension and other postretirement benefit loss, Tax benefit | 0.3 | 0.2 | 0.7 | 0.4 |
Foreign currency translation adjustments, Tax (benefit) expense | ($1.50) | $0.70 | ($4.80) | $2.10 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (Unaudited) (USD $) | Dec. 31, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $146,267 | $177,929 |
Accounts receivable, less allowance for doubtful accounts of $13,616 and $14,027, respectively | 449,166 | 531,515 |
Inventories (Note 11) | 662,883 | 703,766 |
Deferred income taxes | 45,644 | 47,897 |
Other current assets | 70,027 | 64,089 |
Total current assets | 1,373,987 | 1,525,196 |
Property, plant and equipment: | ||
Land and buildings | 422,301 | 437,783 |
Machinery and equipment | 1,596,571 | 1,638,215 |
Less accumulated depreciation | -1,175,771 | -1,191,540 |
Property, plant and equipment, net | 843,101 | 884,458 |
Other assets: | ||
Investments in affiliated companies | 408 | 495 |
Goodwill (Note 18) | 579,567 | 975,576 |
Other intangible assets, less accumulated amortization of $143,355 and $139,245, respectively (Note 18) | 310,251 | 343,176 |
Deferred income taxes | 36,260 | 41,006 |
Other | 108,869 | 98,179 |
Total other assets | 1,035,355 | 1,458,432 |
Total assets | 3,252,443 | 3,868,086 |
Current liabilities: | ||
Current maturities of long-term debt and capital leases (Note 12) | 8,629 | 7,662 |
Notes payable to banks | 86,884 | 72,455 |
Accounts payable | 159,464 | 206,891 |
Accrued income taxes | 66,223 | 16,953 |
Accrued expenses | 63,182 | 99,892 |
Other current liabilities | 144,322 | 158,903 |
Total current liabilities | 528,704 | 562,756 |
Long-term debt and capital leases, less current maturities (Note 12) | 867,103 | 981,666 |
Deferred income taxes | 105,382 | 118,092 |
Accrued pension and postretirement benefits | 167,284 | 180,784 |
Accrued income taxes | 19,653 | 21,384 |
Other liabilities | 33,730 | 41,796 |
Total liabilities | 1,721,856 | 1,906,478 |
Commitments and contingencies | ||
Kennametal Shareholders' Equity: | ||
Capital stock, $1.25 par value; 120,000 shares authorized; 79,147 and 78,672 shares issued, respectively | 98,932 | 98,340 |
Additional paid-in capital | 411,979 | 395,890 |
Retained earnings | 1,123,892 | 1,501,157 |
Accumulated other comprehensive loss | -135,483 | -66,131 |
Total Kennametal Shareholders' Equity | 1,499,320 | 1,929,256 |
Noncontrolling interests | 31,267 | 32,352 |
Total equity | 1,530,587 | 1,961,608 |
Total liabilities and equity | $3,252,443 | $3,868,086 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | Dec. 31, 2014 | Jun. 30, 2014 |
In Thousands, except Per Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $13,616 | $14,027 |
Accumulated amortization on other intangible assets | $143,355 | $139,245 |
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 | 79,147 | 78,672 |
Condensed_Consolidated_Stateme3
Condensed Consolidated Statements of Cash Flow (Unaudited) (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
OPERATING ACTIVITIES | ||
Net (loss) income | ($347,578) | $62,725 |
Adjustments for non-cash items: | ||
Depreciation | 53,341 | 48,267 |
Amortization | 13,959 | 11,667 |
Stock-based compensation expense | 13,475 | 12,108 |
Restructuring and asset impairment charges (Notes 8 and 18) | 383,489 | 0 |
Deferred income tax provision | -13,824 | 13,116 |
Other | 8,938 | 1,587 |
Changes in certain assets and liabilities: | ||
Accounts receivable | 54,928 | 26,942 |
Inventories | 4,727 | -27,044 |
Increase (Decrease) in Accounts Payable and Accrued Liabilities | -74,969 | -34,322 |
Accrued income taxes | 45,596 | -13,997 |
Other | -6,760 | -16,432 |
Net cash flow provided by operating activities | 135,322 | 84,617 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | -54,672 | -48,804 |
Disposals of property, plant and equipment | 978 | 444 |
Business acquisition, net of cash acquired | 0 | -634,615 |
Other | -126 | -60 |
Net cash flow used for investing activities | -53,820 | -683,035 |
FINANCING ACTIVITIES | ||
Net increase in notes payable | 15,241 | 40,910 |
Net increase in short-term revolving and other lines of credit | 8,500 | 14,900 |
Term debt borrowings | 50,727 | 345,485 |
Term debt repayments | -154,547 | -5,000 |
Purchase of capital stock | -168 | -4,400 |
Dividend reinvestment and the effect of employee benefit and stock plans | 7,891 | 18,072 |
Cash dividends paid to shareholders | -28,451 | -28,180 |
Other | -4,786 | 250 |
Net cash flow (used for) provided by financing activities | -105,593 | 382,037 |
Effect of exchange rate changes on cash and cash equivalents | -7,571 | 2,354 |
CASH AND CASH EQUIVALENTS | ||
Net decrease in cash and cash equivalents | -31,662 | -214,027 |
Cash and cash equivalents, beginning of period | 177,929 | 377,316 |
Cash and cash equivalents, end of period | $146,267 | $163,289 |
Organization
Organization | 6 Months Ended |
Dec. 31, 2014 | |
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, 2014 | |
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 2014 Annual Report on Form 10-K. The condensed consolidated balance sheet as of June 30, 2014 was derived from the audited balance sheet included in our 2014 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, 2014 and 2013 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 2015 is to the fiscal year ending June 30, 2015. When used in this Form 10-Q, unless the context requires otherwise, the terms “we,” “our” and “us” refer to Kennametal Inc. and its subsidiaries. | |
During the current quarter, the Company revised its condensed consolidated statement of cash flow for the three months ended September 30, 2014 to correctly present the net cash flow provided by operating activities and effect of exchange rate changes on cash and cash equivalents, resulting in an increase of $8.4 million to operating cash flows and a corresponding decrease in effect of exchange rate changes on cash and cash equivalents. The Company has evaluated this error and determined that the impact of the error was not material to the previously issued interim and annual financial statements. |
New_Accounting_Standards
New Accounting Standards | 6 Months Ended |
Dec. 31, 2014 | |
Accounting Changes and Error Corrections [Abstract] | |
NEW ACCOUNTING STANDARDS | NEW ACCOUNTING STANDARDS |
Adopted | |
In July 2013, the Financial Accounting Standards Board (FASB) issued new guidance on the presentation in the financial statements of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The guidance takes into account these losses and carryforwards as well as the intended or likelihood of use of the unrecognized tax benefit in determining the balance sheet classification as an asset or liability. This guidance was effective for Kennametal beginning July 1, 2014 and did not have a material impact. |
Supplemental_Cash_Flow_Disclos
Supplemental Cash Flow Disclosures | 6 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Supplemental Cash Flow Elements [Abstract] | ||||||||
SUPPLEMENTAL CASH FLOW DISCLOSURES | SUPPLEMENTAL CASH FLOW DISCLOSURES | |||||||
Six Months Ended December 31, | ||||||||
(in thousands) | 2014 | 2013 | ||||||
Cash paid during the period for: | ||||||||
Interest | $ | 16,334 | $ | 14,231 | ||||
Income taxes | 24,894 | 24,868 | ||||||
Supplemental disclosure of non-cash information: | ||||||||
Changes in accounts payable related to purchases of property, plant and equipment | 6,470 | 8,600 | ||||||
Acquisition
Acquisition | 6 Months Ended | |||
Dec. 31, 2014 | ||||
Business Combinations [Abstract] | ||||
ACQUISITION | ACQUISITION | |||
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, net of cash acquired. We funded the acquisition primarily through a combination of cash from operations and available borrowings under our existing credit facility. | ||||
The accompanying condensed consolidated balance sheet as of December 31, 2014 reflects the final allocation of the purchase price. No material adjustments have been made to the allocation in conjunction with finalization. | ||||
The accompanying condensed consolidated statement of income for the six months ended December 31, 2014, includes net sales of $123.3 million and net income of $6.1 million related to TMB. | ||||
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, as well as increased cost of sales resulting from recording inventory at fair value. The pro forma results have been presented for comparative purposes only, include no expected sales or cost synergies 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: | ||||
Six months ended December 31 (in thousands, except per share data) | 2013 | |||
Pro forma (unaudited): | ||||
Net Sales | $ | 1,451,678 | ||
Net income attributable to Kennametal | $ | 83,387 | ||
Per share data attributable to Kennametal: | ||||
Basic earnings per share | $ | 1.06 | ||
Diluted earnings per share | $ | 1.05 | ||
Fair_Value_Measurements
Fair Value Measurements | 6 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
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, 2014, 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) | $ | — | $ | 9,762 | $ | — | $ | 9,762 | ||||||||
Total assets at fair value | $ | — | $ | 9,762 | $ | — | $ | 9,762 | ||||||||
Liabilities: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 120 | $ | — | $ | 120 | ||||||||
Contingent consideration | — | — | 10,000 | 10,000 | ||||||||||||
Total liabilities at fair value | $ | — | $ | 120 | $ | 10,000 | $ | 10,120 | ||||||||
As of June 30, 2014, 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) | $ | — | $ | 253 | $ | — | $ | 253 | ||||||||
Total assets at fair value | $ | — | $ | 253 | $ | — | $ | 253 | ||||||||
Liabilities: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 1,053 | $ | — | $ | 1,053 | ||||||||
Contingent consideration | — | — | 14,000 | 14,000 | ||||||||||||
Total liabilities at fair value | $ | — | $ | 1,053 | $ | 14,000 | $ | 15,053 | ||||||||
(1) Currency derivatives are valued based on observable market spot and forward rates and are classified within Level 2 of the fair value hierarchy. | ||||||||||||||||
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 2 years. During the three months ended December 31, 2014, the Company paid $4.0 million in conjunction with achieved milestone targets. The Company reassessed this contingent consideration and determined that no adjustment to the fair value of the remaining contingent consideration was necessary and that no changes in the expected outcome have occurred during the quarter ended December 31, 2014. |
Derivative_Instruments_and_Hed
Derivative Instruments and Hedging Activities | 6 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
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, 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, | ||||||||||||||
2014 | 2014 | |||||||||||||||
Derivatives designated as hedging instruments | ||||||||||||||||
Other current assets - range forward contracts | $ | 3,668 | $ | 184 | ||||||||||||
Other current liabilities - range forward contracts | — | (6 | ) | |||||||||||||
Other assets - range forward contracts | — | 42 | ||||||||||||||
Total derivatives designated as hedging instruments | 3,668 | 220 | ||||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||
Other current assets - currency forward contracts | 6,094 | 27 | ||||||||||||||
Other current liabilities - currency forward contracts | (120 | ) | (1,047 | ) | ||||||||||||
Total derivatives not designated as hedging instruments | 5,974 | (1,020 | ) | |||||||||||||
Total derivatives | $ | 9,642 | $ | (800 | ) | |||||||||||
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, net. (Gains) 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) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Other (income) expense, net - currency forward contracts | $ | (2,273 | ) | $ | 72 | $ | (7,169 | ) | $ | 114 | ||||||
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, 2014 and June 30, 2014, was $57.0 million and $91.1 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, 2014, we expect to recognize into earnings in the next 12 months $2.3 million of income 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, 2014 and 2013, $0.5 million and $0.5 million was recognized as interest expense, respectively. During the six months ended December 31, 2014 and 2013, $1.0 million and $1.0 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) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Gains (losses) recognized in other comprehensive income, net | $ | 1,205 | $ | (273 | ) | $ | 2,712 | $ | (843 | ) | ||||||
Losses reclassified from accumulated other comprehensive loss into other expense (income), net | $ | 152 | $ | 324 | $ | 502 | $ | 714 | ||||||||
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, 2014 and 2013. |
Restructuring_and_Related_Char
Restructuring and Related Charges | 6 Months Ended | |||||||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||||||
Restructuring Charges [Abstract] | ||||||||||||||||||||||||||||
RESTRUCTURING AND RELATED CHARGES | RESTRUCTURING AND RELATED CHARGES AND ASSET IMPAIRMENT CHARGES | |||||||||||||||||||||||||||
Restructuring and Related | ||||||||||||||||||||||||||||
As previously set forth in the 2014 Annual Report on Form 10-K, we are implementing restructuring actions in conjunction with our Phase 1 restructuring program to achieve synergies across Kennametal as a result of the TMB acquisition by consolidating operations among both organizations, reducing administrative overhead and leveraging the supply chain. These restructuring actions are expected to be completed by the end of fiscal 2016 and are anticipated to be mostly cash expenditures. | ||||||||||||||||||||||||||||
During the six months ended December 31, 2014, we recognized restructuring and related charges of $20.4 million, of this amount, restructuring charges totaled $8.6 million, of which $0.2 million were charges related to inventory disposals and were recorded in cost of goods sold. Restructuring-related charges of $6.3 million were recorded in cost of goods sold and $5.5 million in operating expense for the six months ended December 31, 2014. | ||||||||||||||||||||||||||||
During the six months ended December 31, 2013, we recorded restructuring charges of $2.3 million. | ||||||||||||||||||||||||||||
The total pre-tax charges for Phase 1 programs are expected to be in the range of $55 million to $60 million, which is expected to be approximately 50 percent Industrial and 50 percent Infrastructure. Total restructuring and related charges since inception of $39.5 million have been recorded for these programs through December 31, 2014: $24.5 million in Industrial, $13.1 million in Infrastructure, and $1.8 million in Corporate. | ||||||||||||||||||||||||||||
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) | June 30, 2014 | Expense | Asset Write-Down | Other (2) | Translation | Cash Expenditures | December 31, 2014 | |||||||||||||||||||||
Industrial | ||||||||||||||||||||||||||||
Severance | $ | 5,815 | $ | 3,361 | $ | — | $ | — | $ | (282 | ) | $ | (4,291 | ) | $ | 4,603 | ||||||||||||
Facilities | 444 | 489 | (489 | ) | — | (22 | ) | (389 | ) | 33 | ||||||||||||||||||
Other | 67 | 21 | — | — | (2 | ) | (86 | ) | — | |||||||||||||||||||
Total Industrial | $ | 6,326 | $ | 3,871 | $ | (489 | ) | $ | — | $ | (306 | ) | $ | (4,766 | ) | $ | 4,636 | |||||||||||
Infrastructure | ||||||||||||||||||||||||||||
Severance | $ | 2,458 | $ | 4,177 | $ | — | $ | (459 | ) | $ | (312 | ) | $ | (4,747 | ) | $ | 1,117 | |||||||||||
Facilities | 190 | 542 | (541 | ) | — | (25 | ) | (166 | ) | — | ||||||||||||||||||
Other | 28 | 23 | — | — | (3 | ) | (48 | ) | — | |||||||||||||||||||
Total Infrastructure | $ | 2,676 | $ | 4,742 | $ | (541 | ) | $ | (459 | ) | $ | (340 | ) | $ | (4,961 | ) | $ | 1,117 | ||||||||||
Total | $ | 9,002 | $ | 8,613 | $ | (1,030 | ) | $ | (459 | ) | $ | (646 | ) | $ | (9,727 | ) | $ | 5,753 | ||||||||||
(2) Special termination benefit charge for one of our U.S.-based benefit pension plans resulting from a plant closure - see Note 10. | ||||||||||||||||||||||||||||
Asset impairment | ||||||||||||||||||||||||||||
See discussion on Infrastructure segment goodwill and other intangible asset impairment charges in Note 18. |
StockBased_Compensation
Stock-Based Compensation | 6 Months Ended | |||||||||||||
Dec. 31, 2014 | ||||||||||||||
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, 2014 and 2013 were as follows: | ||||||||||||||
2014 | 2013 | |||||||||||||
Risk-free interest rate | 1.5 | % | 1.3 | % | ||||||||||
Expected life (years) (3) | 4.5 | 4.5 | ||||||||||||
Expected volatility (4) | 32.5 | % | 40.4 | % | ||||||||||
Expected dividend yield | 1.6 | % | 1.5 | % | ||||||||||
(3) Expected life is derived from historical experience. | ||||||||||||||
(4) Expected volatility is based on the implied historical volatility of our stock. | ||||||||||||||
Changes in our stock options for the six months ended December 31, 2014 were as follows: | ||||||||||||||
Options | Weighted | Weighted Average Remaining Life (years) | Aggregate | |||||||||||
Average | Intrinsic value | |||||||||||||
Exercise Price | (in thousands) | |||||||||||||
Options outstanding, June 30, 2014 | 2,264,824 | $ | 33.95 | |||||||||||
Granted | 436,541 | 40.81 | ||||||||||||
Exercised | (222,206 | ) | 27.54 | |||||||||||
Lapsed and forfeited | (11,905 | ) | 41.1 | |||||||||||
Options outstanding, December 31, 2014 | 2,467,254 | $ | 35.71 | 5.3 | $ | 7,580 | ||||||||
Options vested and expected to vest, | 2,206,567 | $ | 35.02 | 5.4 | $ | 7,578 | ||||||||
December 31, 2014 | ||||||||||||||
Options exercisable, December 31, 2014 | 1,600,847 | $ | 32.76 | 4.1 | $ | 7,562 | ||||||||
During the six months ended December 31, 2014 and 2013, compensation expense related to stock options was $2.8 million and $3.5 million, respectively. As of December 31, 2014, the total unrecognized compensation cost related to options outstanding was $3.7 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, 2014 and 2013 was $10.16 and $13.79, respectively. Fair value of options vested during the six months ended December 31, 2014 and 2013 was $6.9 million and $5.0 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 $1.3 million and $4.5 million for the six months ended December 31, 2014 and 2013, respectively. | ||||||||||||||
The amount of cash received from the exercise of capital stock options during the six months ended December 31, 2014 and 2013 was $6.1 million and $12.7 million, respectively. The related tax benefit for the six months ended December 31, 2014 and 2013 was $1.3 million and $2.7 million, respectively. The total intrinsic value of options exercised during the six months ended December 31, 2014 and 2013 was $3.4 million and $9.2 million, respectively. | ||||||||||||||
Under the provisions of the Kennametal Inc. Stock and Incentive Plan of 2010 as amended and restated on October 22, 2013, 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, 2014 was immaterial. The fair market value of shares delivered during the six months ended December 31, 2013 was $0.2 million. | ||||||||||||||
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. Time vesting stock units are valued at the market value of the stock on the grant date. Performance vesting stock units with a market condition are valued using a Monte Carlo model. | ||||||||||||||
Changes in our time vesting and performance vesting restricted stock units for the six months ended December 31, 2014 were as follows: | ||||||||||||||
Performance Vesting Stock Units | Performance Vesting Weighted Average Fair Value | Time Vesting | Time Vesting Weighted Average Fair Value | |||||||||||
Stock Units | ||||||||||||||
Unvested performance vesting and time vesting restricted stock units, June 30, 2014 | 197,356 | $ | 40.92 | 743,326 | $ | 39.2 | ||||||||
Granted | 88,536 | 43.16 | 438,795 | 42.27 | ||||||||||
Vested | (28,022 | ) | 38.95 | (306,484 | ) | 36.26 | ||||||||
Performance metric not achieved | (65,373 | ) | 43.16 | — | — | |||||||||
Forfeited | — | — | (25,471 | ) | 41.69 | |||||||||
Unvested performance vesting and time vesting restricted stock units, December 31, 2014 | 192,497 | $ | 42.98 | 850,166 | $ | 41.78 | ||||||||
During the six months ended December 31, 2014 and 2013, compensation expense related to time vesting and performance vesting restricted stock units was $10.6 million and $8.4 million, respectively. As of December 31, 2014, the total unrecognized compensation cost related to unvested time vesting and performance vesting restricted stock units was $21.3 million and is expected to be recognized over a weighted average period of 2.7 years. |
Benefit_Plans
Benefit Plans | 6 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
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. | ||||||||||||||||
During the quarter we recognized a special termination benefit charge of $0.5 million and a curtailment loss of $0.4 million for one of our U.S.-based defined benefit pension plans resulting from a plant closure. The special termination benefit charge was recognized in restructuring expense. | ||||||||||||||||
The table below summarizes the components of net periodic pension income: | ||||||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Service cost | $ | 1,384 | $ | 1,732 | $ | 2,799 | $ | 3,448 | ||||||||
Interest cost | 9,745 | 10,308 | 19,681 | 20,484 | ||||||||||||
Expected return on plan assets | (14,900 | ) | (14,916 | ) | (29,947 | ) | (29,712 | ) | ||||||||
Amortization of transition obligation | 19 | 20 | 40 | 38 | ||||||||||||
Amortization of prior service credit | (71 | ) | (58 | ) | (141 | ) | (117 | ) | ||||||||
Recognition of actuarial losses | 937 | 670 | 1,937 | 1,312 | ||||||||||||
Curtailment loss | 358 | — | 358 | — | ||||||||||||
Special termination benefit charge | 459 | — | 459 | — | ||||||||||||
Net periodic pension income | $ | (2,069 | ) | $ | (2,244 | ) | $ | (4,814 | ) | $ | (4,547 | ) | ||||
The table below summarizes the components of the net periodic other postretirement benefit cost: | ||||||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Service cost | $ | 27 | $ | 14 | $ | 54 | $ | 28 | ||||||||
Interest cost | 259 | 251 | 519 | 502 | ||||||||||||
Amortization of prior service credit | (28 | ) | (28 | ) | (55 | ) | (56 | ) | ||||||||
Recognition of actuarial loss | 207 | 79 | 414 | 158 | ||||||||||||
Curtailment gain | (221 | ) | — | (221 | ) | — | ||||||||||
Net periodic other postretirement benefit cost | $ | 244 | $ | 316 | $ | 711 | $ | 632 | ||||||||
The curtailment gain of $0.2 million was a result of the plant closure discussed above. |
Inventories
Inventories | 6 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Inventory Disclosure [Abstract] | ||||||||
INVENTORIES | INVENTORIES | |||||||
We used the last-in, first-out (LIFO) method of valuing inventories for 47 percent and 43 percent of total inventories at December 31, 2014 and June 30, 2014, respectively. Since 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-14 | 30-Jun-14 | ||||||
Finished goods | $ | 362,979 | $ | 371,599 | ||||
Work in process and powder blends | 286,841 | 308,129 | ||||||
Raw materials | 110,756 | 126,004 | ||||||
Inventories at current cost | 760,576 | 805,732 | ||||||
Less: LIFO valuation | (97,693 | ) | (101,966 | ) | ||||
Total inventories | $ | 662,883 | $ | 703,766 | ||||
Long_Term_Debt
Long - Term Debt | 6 Months Ended |
Dec. 31, 2014 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | 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, 2014. We had $174.1 million and $287.1 million of borrowings outstanding under the 2011 Credit Agreement as of December 31, 2014 and June 30, 2014, 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 $703.3 million and $705.3 million at December 31, 2014 and June 30, 2014, respectively. The Level 2 fair value is determined based on the quoted market price of this debt as of December 31, 2014 and June 30, 2014, respectively. |
Environmental_Matters
Environmental Matters | 6 Months Ended |
Dec. 31, 2014 | |
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, proceedings are in the very early stages and 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, 2014 and June 30, 2014, the balances of these reserves were $12.6 million and $11.0 million. 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, 2014 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES |
The effective income tax rate for the three months ended December 31, 2014 and 2013 was negative 12.7 percent (provision on a loss) and 40.8 percent (provision on income), respectively. The effective income tax rate for six months ended December 31, 2014 and 2013 was negative 20.1 percent (provision on a loss) and 31.8 percent (provision on income), respectively. The change in both periods was primarily driven by the asset impairment charges recorded in the current quarter, most of which could not be tax effected, lower relative U.S. current year earnings compared with the rest of the world where the tax rates are generally lower, and favorable effects of the extension of the credit for increase in research activities contained in the Tax Increase Prevention Act of 2014 that was enacted during the current quarter. The prior year rate included a tax charge related to a change in assertion of a foreign subsidiary’s certain undistributed earnings, which were no longer considered permanently reinvested. |
Earnings_Per_Share
Earnings Per Share | 6 Months Ended |
Dec. 31, 2014 | |
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 and restricted stock units. The difference between basic and diluted earnings per share relates solely to the effect of capital stock options and restricted stock units. | |
For the three and six months ended December 31, 2014, the effect of unexercised capital stock options and unvested restricted stock units was anti-dilutive as a result of a net loss in the periods and therefore has been excluded from diluted shares outstanding as well as from the diluted earnings per share calculation. For purposes of determining the number of diluted shares outstanding for the three and six months ended December 31, 2013, weighted average shares outstanding for basic earnings per share calculations were increased due solely to the dilutive effect of unexercised capital stock options and unvested restricted stock units by $1.0 million and 1.0 million shares, respectively. Unexercised capital stock options and restricted stock units of 0.2 million shares and 0.3 million shares for the three and six months ended December 31, 2013, 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, 2014 | ||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||
EQUITY | EQUITY | |||||||||||||||||||||||
A summary of the changes in the carrying amounts of total equity, Kennametal Shareholders’ equity and equity attributable to noncontrolling interests as of December 31, 2014 and 2013 is as follows: | ||||||||||||||||||||||||
Kennametal Shareholders’ 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, 2014 | $ | 98,340 | $ | 395,890 | $ | 1,501,157 | $ | (66,131 | ) | $ | 32,352 | $ | 1,961,608 | |||||||||||
Net (loss) income | — | — | (348,814 | ) | — | 1,236 | (347,578 | ) | ||||||||||||||||
Other comprehensive loss | — | — | — | (69,352 | ) | (2,274 | ) | (71,626 | ) | |||||||||||||||
Dividend reinvestment | 5 | 163 | — | — | — | 168 | ||||||||||||||||||
Capital stock issued under employee benefit and stock plans | 592 | 16,089 | — | — | — | 16,681 | ||||||||||||||||||
Purchase of capital stock | (5 | ) | (163 | ) | — | — | — | (168 | ) | |||||||||||||||
Cash dividends paid | — | — | (28,451 | ) | — | (47 | ) | (28,498 | ) | |||||||||||||||
Balance as of December 31, 2014 | $ | 98,932 | $ | 411,979 | $ | 1,123,892 | $ | (135,483 | ) | $ | 31,267 | $ | 1,530,587 | |||||||||||
Kennametal Shareholders’ 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, 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, 2013 | $ | 98,234 | $ | 392,103 | $ | 1,433,093 | $ | (51,433 | ) | $ | 31,307 | $ | 1,903,304 | |||||||||||
The amounts of comprehensive income attributable to Kennametal Shareholders and noncontrolling interests are disclosed in the condensed consolidated statements of comprehensive income. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive (Loss) Income | 6 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||
Accumulated Other Comprehensive (Loss) Income | ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME | ||||||||||||||||
Total accumulated other comprehensive (loss) income (AOCL) consists of net (loss) income and other changes in equity from transactions and other events from sources other than shareholders. 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, 2014 (in thousands): | |||||||||||||||||
Attributable to Kennametal: | Postretirement benefit plans | Currency translation adjustment | Derivatives | Total | |||||||||||||
Balance, September 30, 2014 | $ | (89,347 | ) | $ | (11,210 | ) | $ | (9,329 | ) | $ | (109,886 | ) | |||||
Other comprehensive loss before | 1,924 | (29,427 | ) | 1,206 | (26,297 | ) | |||||||||||
reclassifications | |||||||||||||||||
Amounts reclassified from AOCL | 735 | — | (35 | ) | 700 | ||||||||||||
Net current period other comprehensive | 2,659 | (29,427 | ) | 1,171 | (25,597 | ) | |||||||||||
loss | |||||||||||||||||
AOCL, December 31, 2014 | $ | (86,688 | ) | $ | (40,637 | ) | $ | (8,158 | ) | $ | (135,483 | ) | |||||
Attributable to noncontrolling interests: | |||||||||||||||||
Balance, September 30, 2014 | $ | — | $ | (405 | ) | $ | — | $ | (405 | ) | |||||||
Other comprehensive loss before | — | (782 | ) | — | (782 | ) | |||||||||||
reclassifications | |||||||||||||||||
Net current period other comprehensive | — | (782 | ) | — | (782 | ) | |||||||||||
loss | |||||||||||||||||
AOCL, December 31, 2014 | $ | — | $ | (1,187 | ) | $ | — | $ | (1,187 | ) | |||||||
The components of, and changes in, AOCL were as follows (net of tax) for the six months ended December 31, 2014 (in thousands): | |||||||||||||||||
Attributable to Kennametal: | Postretirement benefit plans | Currency translation adjustment | Derivatives | Total | |||||||||||||
Balance, June 30, 2014 | $ | (93,742 | ) | $ | 38,811 | $ | (11,200 | ) | $ | (66,131 | ) | ||||||
Other comprehensive loss before | 5,565 | (79,448 | ) | 2,713 | (71,170 | ) | |||||||||||
reclassifications | |||||||||||||||||
Amounts reclassified from AOCL | 1,489 | — | 329 | 1,818 | |||||||||||||
Net current period other comprehensive | 7,054 | (79,448 | ) | 3,042 | (69,352 | ) | |||||||||||
loss | |||||||||||||||||
AOCL, December 31, 2014 | $ | (86,688 | ) | $ | (40,637 | ) | $ | (8,158 | ) | $ | (135,483 | ) | |||||
Attributable to noncontrolling interests: | |||||||||||||||||
Balance, June 30, 2014 | $ | — | $ | 1,087 | $ | — | $ | 1,087 | |||||||||
Other comprehensive loss before | — | (2,274 | ) | — | (2,274 | ) | |||||||||||
reclassifications | |||||||||||||||||
Net current period other comprehensive | — | (2,274 | ) | — | (2,274 | ) | |||||||||||
loss | |||||||||||||||||
AOCL, December 31, 2014 | $ | — | $ | (1,187 | ) | $ | — | $ | (1,187 | ) | |||||||
The components of, and changes in, AOCL were as follows (net of tax) for the three months ended December 31, 2013 (in thousands): | |||||||||||||||||
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) income before reclassifications | (810 | ) | 11,263 | (273 | ) | 10,180 | |||||||||||
Amounts reclassified from AOCL | 498 | — | 440 | 938 | |||||||||||||
Net current period other comprehensive | (312 | ) | 11,263 | 167 | 11,118 | ||||||||||||
(loss) income | |||||||||||||||||
AOCL, December 31, 2013 | $ | (85,731 | ) | $ | 46,773 | $ | (12,475 | ) | $ | (51,433 | ) | ||||||
Attributable to noncontrolling interests: | |||||||||||||||||
Balance, September 30, 2013 | $ | — | $ | 535 | $ | — | $ | 535 | |||||||||
Other comprehensive income before | — | 413 | — | 413 | |||||||||||||
reclassifications | |||||||||||||||||
Net current period other comprehensive | — | 413 | — | 413 | |||||||||||||
income | |||||||||||||||||
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 (in thousands): | |||||||||||||||||
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) income before reclassifications | (2,776 | ) | 39,359 | (843 | ) | 35,740 | |||||||||||
Amounts reclassified from AOCL | 982 | — | 849 | 1,831 | |||||||||||||
Net current period other comprehensive | (1,794 | ) | 39,359 | 6 | 37,571 | ||||||||||||
(loss) income | |||||||||||||||||
AOCL, December 31, 2013 | $ | (85,731 | ) | $ | 46,773 | $ | (12,475 | ) | $ | (51,433 | ) | ||||||
Attributable to noncontrolling interests: | |||||||||||||||||
Balance, June 30, 2013 | $ | — | $ | 721 | $ | — | $ | 721 | |||||||||
Other comprehensive income before | — | 227 | — | 227 | |||||||||||||
reclassifications | |||||||||||||||||
Net current period other comprehensive | — | 227 | — | 227 | |||||||||||||
income | |||||||||||||||||
AOCL, December 31, 2013 | $ | — | $ | 948 | $ | — | $ | 948 | |||||||||
Reclassifications out of AOCL for the three and six months ended December 31, 2014 and 2013, respectively consisted of the following (in thousands): | |||||||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | ||||||||||||||||
Details about AOCL components | 2014 | 2013 | 2014 | 2013 | Affected line item in the Income Statement | ||||||||||||
Gains and losses on cash flow hedges: | |||||||||||||||||
Forward starting interest rate swaps | $ | 505 | $ | 486 | $ | 1,010 | $ | 973 | Interest expense | ||||||||
Currency exchange contracts | (562 | ) | 224 | (474 | ) | 396 | Other expense, net | ||||||||||
Total before tax | (57 | ) | 710 | 536 | 1,369 | ||||||||||||
Tax (expense) benefit | (22 | ) | 270 | 207 | 520 | Provision for income taxes | |||||||||||
Net of tax | $ | (35 | ) | $ | 440 | $ | 329 | $ | 849 | ||||||||
Postretirement benefit plans: | |||||||||||||||||
Amortization of transition obligations | $ | 19 | $ | 20 | $ | 40 | $ | 38 | See note 10 for further details | ||||||||
Amortization of prior service credit | (99 | ) | (86 | ) | (196 | ) | (173 | ) | See note 10 for further details | ||||||||
Recognition of actuarial losses | 1,144 | 749 | 2,351 | 1,470 | See note 10 for further details | ||||||||||||
Total before taxes | 1,064 | 683 | 2,195 | 1,335 | |||||||||||||
Tax benefit | 329 | 185 | 706 | 353 | Provision for income taxes | ||||||||||||
Net of tax | $ | 735 | $ | 498 | $ | 1,489 | $ | 982 | |||||||||
Goodwill_and_Other_Intangible_
Goodwill and Other Intangible Assets | 6 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
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. We also perform specific impairment tests on an interim basis based on the results of an ongoing cumulative qualitative assessment if indicative of impairment of the goodwill for a reporting unit or an indefinite-lived intangible asset. We evaluate the recoverability of goodwill for each of our reporting units by comparing the fair value of each reporting unit with its carrying value. The fair values of our reporting units are determined using a combination of a discounted cash flow analysis and market multiples based upon historical and projected financial information. We apply our best judgment when assessing the reasonableness of the financial projections used to determine the fair value of each reporting unit. We evaluate the recoverability of indefinite-lived intangible assets using a discounted cash flow analysis based on projected financial information. This evaluation is sensitive to changes in market interest rates and other external factors. | |||||||||||||||||||
Late in the December quarter, the Company experienced an abrupt change in customer demand in the oil and gas markets that is expected to continue into the foreseeable future, coupled with the severe and persistent decline in the earthworks markets. In view of the severe downturn in the global Infrastructure markets in the December quarter, we made an assessment of the possible impairment of the goodwill and other long-lived assets of our Infrastructure reporting unit. As a result of this assessment, we determined that the magnitude and duration of the economic downturn of the Infrastructure end markets, as well as other factors, necessitated an interim impairment test of our Infrastructure reporting unit. As a result of our test, we recorded a preliminary non-cash pre-tax impairment charge of $376.5 million in the Infrastructure segment, of which $375.0 million was for goodwill and $1.5 million was for an indefinite-lived trademark intangible asset. The goodwill impairment charge is subject to finalization of fair values related to intangibles and property, plant and equipment, which we expect to complete in the third quarter of fiscal 2015. Goodwill of $266.2 million remains on the books of our Infrastructure segment. | |||||||||||||||||||
Identifiable assets with finite lives are reviewed for impairment whenever events or circumstances indicate that the carrying value may not be recoverable. During the December quarter, we performed a preliminary review of our identifiable assets with finite lives and preliminarily determined that the assets were not impaired. The review is subject to finalization, which we expect to complete in the third quarter of fiscal 2015. | |||||||||||||||||||
The further acceleration or extended persistence of the current downturn in the global end markets could have a further negative impact on our business and financial performance. We are currently in the beginning stages of exploring strategic alternatives for several businesses within the Infrastructure segment, which have total estimated net book values of approximately $150 million to $200 million as of December 31, 2014. As the strategic direction has not yet been determined for these businesses, the Company cannot determine if additional impairment charges are either probable or estimable. | |||||||||||||||||||
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 | Total | ||||||||||||||||
Gross goodwill | $ | 472,337 | $ | 654,081 | $ | 1,126,418 | |||||||||||||
Accumulated impairment losses | (150,842 | ) | — | (150,842 | ) | ||||||||||||||
Balance as of June 30, 2014 | $ | 321,495 | $ | 654,081 | $ | 975,576 | |||||||||||||
Activity for the six months ended December 31, 2014: | |||||||||||||||||||
Acquisition | 2,984 | — | 2,984 | ||||||||||||||||
Translation | (11,082 | ) | (12,911 | ) | (23,993 | ) | |||||||||||||
Change in gross goodwill | (8,098 | ) | (12,911 | ) | (21,009 | ) | |||||||||||||
Impairment charge | — | (375,000 | ) | (375,000 | ) | ||||||||||||||
Gross goodwill | 464,239 | 641,170 | 1,105,409 | ||||||||||||||||
Accumulated impairment losses | (150,842 | ) | (375,000 | ) | (525,842 | ) | |||||||||||||
Balance as of December 31, 2014 | $ | 313,397 | $ | 266,170 | $ | 579,567 | |||||||||||||
The components of our other intangible assets were as follows: | |||||||||||||||||||
Estimated | 31-Dec-14 | 30-Jun-14 | |||||||||||||||||
Useful Life | |||||||||||||||||||
(in thousands) | (in years) | Gross Carrying | Accumulated | Gross Carrying | Accumulated | ||||||||||||||
Amount | Amortization | Amount | Amortization | ||||||||||||||||
Contract-based | 3 to 15 | $ | 8,534 | $ | (7,624 | ) | $ | 23,446 | $ | (10,820 | ) | ||||||||
Technology-based and other | 4 to 20 | 53,657 | (28,361 | ) | 54,842 | (28,516 | ) | ||||||||||||
Customer-related | 10 to 21 | 278,993 | (82,567 | ) | 285,751 | (76,376 | ) | ||||||||||||
Unpatented technology | 10 to 30 | 60,201 | (13,395 | ) | 61,867 | (12,549 | ) | ||||||||||||
Trademarks | 5 to 20 | 18,764 | (11,408 | ) | 19,256 | (10,984 | ) | ||||||||||||
Trademarks | Indefinite | 33,457 | — | 37,259 | — | ||||||||||||||
Total | $ | 453,606 | $ | (143,355 | ) | $ | 482,421 | $ | (139,245 | ) | |||||||||
During the three months ended December 31, 2014, an impairment of $10.5 million was recorded for a contract-based technology intangible asset that was part of the Infrastructure segment, resulting in a non-cash impairment charge of $5.5 million and a reduction in a liability of $5.0 million. As previously mentioned, we recorded a $1.5 million impairment for an indefinite-lived trademark intangible asset as a result of our interim impairment test of our Infrastructure segment. | |||||||||||||||||||
During the six months ended December 31, 2014, we recorded amortization expense of $14.0 million related to our other intangible assets and unfavorable currency translation adjustments of $7.1 million. |
Segment_Data
Segment Data | 6 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
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. | ||||||||||||||||
The Industrial segment generally serves customers that operate in industrial end markets such as aerospace and 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 (loss) by segment are as follows: | ||||||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Sales: | ||||||||||||||||
Industrial | $ | 371,557 | $ | 370,647 | $ | 749,415 | $ | 708,876 | ||||||||
Infrastructure | 304,074 | 319,289 | 621,157 | 600,867 | ||||||||||||
Total sales | $ | 675,631 | $ | 689,936 | $ | 1,370,572 | $ | 1,309,743 | ||||||||
Operating (loss) income: | ||||||||||||||||
Industrial | $ | 41,795 | $ | 33,218 | $ | 85,812 | $ | 73,038 | ||||||||
Infrastructure (5) | (371,920 | ) | 18,604 | (352,699 | ) | 40,294 | ||||||||||
Corporate | (3,646 | ) | (2,106 | ) | (5,864 | ) | (4,787 | ) | ||||||||
Total operating (loss) income | (333,771 | ) | 49,716 | (272,751 | ) | 108,545 | ||||||||||
Interest expense | 7,960 | 8,037 | 16,170 | 15,118 | ||||||||||||
Other expense, net | 2,223 | 856 | 409 | 1,466 | ||||||||||||
(Loss) income from continuing operations before income taxes | $ | (343,954 | ) | $ | 40,823 | $ | (289,330 | ) | $ | 91,961 | ||||||
(5) See Note 18 regarding Infrastructure segment impairment charges for goodwill and other intangible assets. |
Supplemental_Cash_Flow_Disclos1
Supplemental Cash Flow Disclosures (Tables) | 6 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Supplemental Cash Flow Elements [Abstract] | ||||||||
Supplemental Cash Flow Disclosures | ||||||||
Six Months Ended December 31, | ||||||||
(in thousands) | 2014 | 2013 | ||||||
Cash paid during the period for: | ||||||||
Interest | $ | 16,334 | $ | 14,231 | ||||
Income taxes | 24,894 | 24,868 | ||||||
Supplemental disclosure of non-cash information: | ||||||||
Changes in accounts payable related to purchases of property, plant and equipment | 6,470 | 8,600 | ||||||
Acquisition_Tables
Acquisition (Tables) | 6 Months Ended | |||
Dec. 31, 2014 | ||||
Business Combinations [Abstract] | ||||
Pro forma operating results | Unaudited pro forma summary of operating results of Kennametal, assuming the acquisition had occurred as of July 1, 2012, are as follows: | |||
Six months ended December 31 (in thousands, except per share data) | 2013 | |||
Pro forma (unaudited): | ||||
Net Sales | $ | 1,451,678 | ||
Net income attributable to Kennametal | $ | 83,387 | ||
Per share data attributable to Kennametal: | ||||
Basic earnings per share | $ | 1.06 | ||
Diluted earnings per share | $ | 1.05 | ||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 6 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||
Financial instruments at fair value on recurring basis | As of December 31, 2014, 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) | $ | — | $ | 9,762 | $ | — | $ | 9,762 | ||||||||
Total assets at fair value | $ | — | $ | 9,762 | $ | — | $ | 9,762 | ||||||||
Liabilities: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 120 | $ | — | $ | 120 | ||||||||
Contingent consideration | — | — | 10,000 | 10,000 | ||||||||||||
Total liabilities at fair value | $ | — | $ | 120 | $ | 10,000 | $ | 10,120 | ||||||||
As of June 30, 2014, 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) | $ | — | $ | 253 | $ | — | $ | 253 | ||||||||
Total assets at fair value | $ | — | $ | 253 | $ | — | $ | 253 | ||||||||
Liabilities: | ||||||||||||||||
Derivatives (1) | $ | — | $ | 1,053 | $ | — | $ | 1,053 | ||||||||
Contingent consideration | — | — | 14,000 | 14,000 | ||||||||||||
Total liabilities at fair value | $ | — | $ | 1,053 | $ | 14,000 | $ | 15,053 | ||||||||
(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_Hed1
Derivative Instruments and Hedging Activities (Tables) | 6 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
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, | ||||||||||||||
2014 | 2014 | |||||||||||||||
Derivatives designated as hedging instruments | ||||||||||||||||
Other current assets - range forward contracts | $ | 3,668 | $ | 184 | ||||||||||||
Other current liabilities - range forward contracts | — | (6 | ) | |||||||||||||
Other assets - range forward contracts | — | 42 | ||||||||||||||
Total derivatives designated as hedging instruments | 3,668 | 220 | ||||||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||
Other current assets - currency forward contracts | 6,094 | 27 | ||||||||||||||
Other current liabilities - currency forward contracts | (120 | ) | (1,047 | ) | ||||||||||||
Total derivatives not designated as hedging instruments | 5,974 | (1,020 | ) | |||||||||||||
Total derivatives | $ | 9,642 | $ | (800 | ) | |||||||||||
(Gains) losses related to derivatives not designated as hedging instruments | (Gains) 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) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Other (income) expense, net - currency forward contracts | $ | (2,273 | ) | $ | 72 | $ | (7,169 | ) | $ | 114 | ||||||
Gains and losses 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) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Gains (losses) recognized in other comprehensive income, net | $ | 1,205 | $ | (273 | ) | $ | 2,712 | $ | (843 | ) | ||||||
Losses reclassified from accumulated other comprehensive loss into other expense (income), net | $ | 152 | $ | 324 | $ | 502 | $ | 714 | ||||||||
Restructuring_Tables
Restructuring (Tables) | 6 Months Ended | |||||||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||||||
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) | June 30, 2014 | Expense | Asset Write-Down | Other (2) | Translation | Cash Expenditures | December 31, 2014 | |||||||||||||||||||||
Industrial | ||||||||||||||||||||||||||||
Severance | $ | 5,815 | $ | 3,361 | $ | — | $ | — | $ | (282 | ) | $ | (4,291 | ) | $ | 4,603 | ||||||||||||
Facilities | 444 | 489 | (489 | ) | — | (22 | ) | (389 | ) | 33 | ||||||||||||||||||
Other | 67 | 21 | — | — | (2 | ) | (86 | ) | — | |||||||||||||||||||
Total Industrial | $ | 6,326 | $ | 3,871 | $ | (489 | ) | $ | — | $ | (306 | ) | $ | (4,766 | ) | $ | 4,636 | |||||||||||
Infrastructure | ||||||||||||||||||||||||||||
Severance | $ | 2,458 | $ | 4,177 | $ | — | $ | (459 | ) | $ | (312 | ) | $ | (4,747 | ) | $ | 1,117 | |||||||||||
Facilities | 190 | 542 | (541 | ) | — | (25 | ) | (166 | ) | — | ||||||||||||||||||
Other | 28 | 23 | — | — | (3 | ) | (48 | ) | — | |||||||||||||||||||
Total Infrastructure | $ | 2,676 | $ | 4,742 | $ | (541 | ) | $ | (459 | ) | $ | (340 | ) | $ | (4,961 | ) | $ | 1,117 | ||||||||||
Total | $ | 9,002 | $ | 8,613 | $ | (1,030 | ) | $ | (459 | ) | $ | (646 | ) | $ | (9,727 | ) | $ | 5,753 | ||||||||||
(2) Special termination benefit charge for one of our U.S.-based benefit pension plans resulting from a plant closure - see Note 10. |
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 6 Months Ended | |||||||||||||
Dec. 31, 2014 | ||||||||||||||
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, 2014 and 2013 were as follows: | |||||||||||||
2014 | 2013 | |||||||||||||
Risk-free interest rate | 1.5 | % | 1.3 | % | ||||||||||
Expected life (years) (3) | 4.5 | 4.5 | ||||||||||||
Expected volatility (4) | 32.5 | % | 40.4 | % | ||||||||||
Expected dividend yield | 1.6 | % | 1.5 | % | ||||||||||
(3) Expected life is derived from historical experience. | ||||||||||||||
(4) 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, 2014 were as follows: | |||||||||||||
Options | Weighted | Weighted Average Remaining Life (years) | Aggregate | |||||||||||
Average | Intrinsic value | |||||||||||||
Exercise Price | (in thousands) | |||||||||||||
Options outstanding, June 30, 2014 | 2,264,824 | $ | 33.95 | |||||||||||
Granted | 436,541 | 40.81 | ||||||||||||
Exercised | (222,206 | ) | 27.54 | |||||||||||
Lapsed and forfeited | (11,905 | ) | 41.1 | |||||||||||
Options outstanding, December 31, 2014 | 2,467,254 | $ | 35.71 | 5.3 | $ | 7,580 | ||||||||
Options vested and expected to vest, | 2,206,567 | $ | 35.02 | 5.4 | $ | 7,578 | ||||||||
December 31, 2014 | ||||||||||||||
Options exercisable, December 31, 2014 | 1,600,847 | $ | 32.76 | 4.1 | $ | 7,562 | ||||||||
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, 2014 were as follows: | |||||||||||||
Performance Vesting Stock Units | Performance Vesting Weighted Average Fair Value | Time Vesting | Time Vesting Weighted Average Fair Value | |||||||||||
Stock Units | ||||||||||||||
Unvested performance vesting and time vesting restricted stock units, June 30, 2014 | 197,356 | $ | 40.92 | 743,326 | $ | 39.2 | ||||||||
Granted | 88,536 | 43.16 | 438,795 | 42.27 | ||||||||||
Vested | (28,022 | ) | 38.95 | (306,484 | ) | 36.26 | ||||||||
Performance metric not achieved | (65,373 | ) | 43.16 | — | — | |||||||||
Forfeited | — | — | (25,471 | ) | 41.69 | |||||||||
Unvested performance vesting and time vesting restricted stock units, December 31, 2014 | 192,497 | $ | 42.98 | 850,166 | $ | 41.78 | ||||||||
Benefit_Plans_Tables
Benefit Plans (Tables) | 6 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | ||||||||||||||||
Net periodic pension income | The table below summarizes the components of net periodic pension income: | |||||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Service cost | $ | 1,384 | $ | 1,732 | $ | 2,799 | $ | 3,448 | ||||||||
Interest cost | 9,745 | 10,308 | 19,681 | 20,484 | ||||||||||||
Expected return on plan assets | (14,900 | ) | (14,916 | ) | (29,947 | ) | (29,712 | ) | ||||||||
Amortization of transition obligation | 19 | 20 | 40 | 38 | ||||||||||||
Amortization of prior service credit | (71 | ) | (58 | ) | (141 | ) | (117 | ) | ||||||||
Recognition of actuarial losses | 937 | 670 | 1,937 | 1,312 | ||||||||||||
Curtailment loss | 358 | — | 358 | — | ||||||||||||
Special termination benefit charge | 459 | — | 459 | — | ||||||||||||
Net periodic pension income | $ | (2,069 | ) | $ | (2,244 | ) | $ | (4,814 | ) | $ | (4,547 | ) | ||||
Net periodic other postretirement costs | The table below summarizes the components of the net periodic other postretirement benefit cost: | |||||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Service cost | $ | 27 | $ | 14 | $ | 54 | $ | 28 | ||||||||
Interest cost | 259 | 251 | 519 | 502 | ||||||||||||
Amortization of prior service credit | (28 | ) | (28 | ) | (55 | ) | (56 | ) | ||||||||
Recognition of actuarial loss | 207 | 79 | 414 | 158 | ||||||||||||
Curtailment gain | (221 | ) | — | (221 | ) | — | ||||||||||
Net periodic other postretirement benefit cost | $ | 244 | $ | 316 | $ | 711 | $ | 632 | ||||||||
Inventories_Tables
Inventories (Tables) | 6 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Inventory Disclosure [Abstract] | ||||||||
Inventories | Inventories consisted of the following: | |||||||
(in thousands) | 31-Dec-14 | 30-Jun-14 | ||||||
Finished goods | $ | 362,979 | $ | 371,599 | ||||
Work in process and powder blends | 286,841 | 308,129 | ||||||
Raw materials | 110,756 | 126,004 | ||||||
Inventories at current cost | 760,576 | 805,732 | ||||||
Less: LIFO valuation | (97,693 | ) | (101,966 | ) | ||||
Total inventories | $ | 662,883 | $ | 703,766 | ||||
Equity_Tables
Equity (Tables) | 6 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||
Summary of the changes in the carrying amounts of total equity, Kennametal shareholders' equity and equity attributable to noncontrolling interests | A summary of the changes in the carrying amounts of total equity, Kennametal Shareholders’ equity and equity attributable to noncontrolling interests as of December 31, 2014 and 2013 is as follows: | |||||||||||||||||||||||
Kennametal Shareholders’ 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, 2014 | $ | 98,340 | $ | 395,890 | $ | 1,501,157 | $ | (66,131 | ) | $ | 32,352 | $ | 1,961,608 | |||||||||||
Net (loss) income | — | — | (348,814 | ) | — | 1,236 | (347,578 | ) | ||||||||||||||||
Other comprehensive loss | — | — | — | (69,352 | ) | (2,274 | ) | (71,626 | ) | |||||||||||||||
Dividend reinvestment | 5 | 163 | — | — | — | 168 | ||||||||||||||||||
Capital stock issued under employee benefit and stock plans | 592 | 16,089 | — | — | — | 16,681 | ||||||||||||||||||
Purchase of capital stock | (5 | ) | (163 | ) | — | — | — | (168 | ) | |||||||||||||||
Cash dividends paid | — | — | (28,451 | ) | — | (47 | ) | (28,498 | ) | |||||||||||||||
Balance as of December 31, 2014 | $ | 98,932 | $ | 411,979 | $ | 1,123,892 | $ | (135,483 | ) | $ | 31,267 | $ | 1,530,587 | |||||||||||
Kennametal Shareholders’ 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, 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, 2013 | $ | 98,234 | $ | 392,103 | $ | 1,433,093 | $ | (51,433 | ) | $ | 31,307 | $ | 1,903,304 | |||||||||||
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive (Loss) Income (Tables) | 6 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
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, 2014 (in thousands): | ||||||||||||||||
Attributable to Kennametal: | Postretirement benefit plans | Currency translation adjustment | Derivatives | Total | |||||||||||||
Balance, September 30, 2014 | $ | (89,347 | ) | $ | (11,210 | ) | $ | (9,329 | ) | $ | (109,886 | ) | |||||
Other comprehensive loss before | 1,924 | (29,427 | ) | 1,206 | (26,297 | ) | |||||||||||
reclassifications | |||||||||||||||||
Amounts reclassified from AOCL | 735 | — | (35 | ) | 700 | ||||||||||||
Net current period other comprehensive | 2,659 | (29,427 | ) | 1,171 | (25,597 | ) | |||||||||||
loss | |||||||||||||||||
AOCL, December 31, 2014 | $ | (86,688 | ) | $ | (40,637 | ) | $ | (8,158 | ) | $ | (135,483 | ) | |||||
Attributable to noncontrolling interests: | |||||||||||||||||
Balance, September 30, 2014 | $ | — | $ | (405 | ) | $ | — | $ | (405 | ) | |||||||
Other comprehensive loss before | — | (782 | ) | — | (782 | ) | |||||||||||
reclassifications | |||||||||||||||||
Net current period other comprehensive | — | (782 | ) | — | (782 | ) | |||||||||||
loss | |||||||||||||||||
AOCL, December 31, 2014 | $ | — | $ | (1,187 | ) | $ | — | $ | (1,187 | ) | |||||||
The components of, and changes in, AOCL were as follows (net of tax) for the six months ended December 31, 2014 (in thousands): | |||||||||||||||||
Attributable to Kennametal: | Postretirement benefit plans | Currency translation adjustment | Derivatives | Total | |||||||||||||
Balance, June 30, 2014 | $ | (93,742 | ) | $ | 38,811 | $ | (11,200 | ) | $ | (66,131 | ) | ||||||
Other comprehensive loss before | 5,565 | (79,448 | ) | 2,713 | (71,170 | ) | |||||||||||
reclassifications | |||||||||||||||||
Amounts reclassified from AOCL | 1,489 | — | 329 | 1,818 | |||||||||||||
Net current period other comprehensive | 7,054 | (79,448 | ) | 3,042 | (69,352 | ) | |||||||||||
loss | |||||||||||||||||
AOCL, December 31, 2014 | $ | (86,688 | ) | $ | (40,637 | ) | $ | (8,158 | ) | $ | (135,483 | ) | |||||
Attributable to noncontrolling interests: | |||||||||||||||||
Balance, June 30, 2014 | $ | — | $ | 1,087 | $ | — | $ | 1,087 | |||||||||
Other comprehensive loss before | — | (2,274 | ) | — | (2,274 | ) | |||||||||||
reclassifications | |||||||||||||||||
Net current period other comprehensive | — | (2,274 | ) | — | (2,274 | ) | |||||||||||
loss | |||||||||||||||||
AOCL, December 31, 2014 | $ | — | $ | (1,187 | ) | $ | — | $ | (1,187 | ) | |||||||
The components of, and changes in, AOCL were as follows (net of tax) for the three months ended December 31, 2013 (in thousands): | |||||||||||||||||
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) income before reclassifications | (810 | ) | 11,263 | (273 | ) | 10,180 | |||||||||||
Amounts reclassified from AOCL | 498 | — | 440 | 938 | |||||||||||||
Net current period other comprehensive | (312 | ) | 11,263 | 167 | 11,118 | ||||||||||||
(loss) income | |||||||||||||||||
AOCL, December 31, 2013 | $ | (85,731 | ) | $ | 46,773 | $ | (12,475 | ) | $ | (51,433 | ) | ||||||
Attributable to noncontrolling interests: | |||||||||||||||||
Balance, September 30, 2013 | $ | — | $ | 535 | $ | — | $ | 535 | |||||||||
Other comprehensive income before | — | 413 | — | 413 | |||||||||||||
reclassifications | |||||||||||||||||
Net current period other comprehensive | — | 413 | — | 413 | |||||||||||||
income | |||||||||||||||||
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 (in thousands): | |||||||||||||||||
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) income before reclassifications | (2,776 | ) | 39,359 | (843 | ) | 35,740 | |||||||||||
Amounts reclassified from AOCL | 982 | — | 849 | 1,831 | |||||||||||||
Net current period other comprehensive | (1,794 | ) | 39,359 | 6 | 37,571 | ||||||||||||
(loss) income | |||||||||||||||||
AOCL, December 31, 2013 | $ | (85,731 | ) | $ | 46,773 | $ | (12,475 | ) | $ | (51,433 | ) | ||||||
Attributable to noncontrolling interests: | |||||||||||||||||
Balance, June 30, 2013 | $ | — | $ | 721 | $ | — | $ | 721 | |||||||||
Other comprehensive income before | — | 227 | — | 227 | |||||||||||||
reclassifications | |||||||||||||||||
Net current period other comprehensive | — | 227 | — | 227 | |||||||||||||
income | |||||||||||||||||
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, 2014 and 2013, respectively consisted of the following (in thousands): | ||||||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | ||||||||||||||||
Details about AOCL components | 2014 | 2013 | 2014 | 2013 | Affected line item in the Income Statement | ||||||||||||
Gains and losses on cash flow hedges: | |||||||||||||||||
Forward starting interest rate swaps | $ | 505 | $ | 486 | $ | 1,010 | $ | 973 | Interest expense | ||||||||
Currency exchange contracts | (562 | ) | 224 | (474 | ) | 396 | Other expense, net | ||||||||||
Total before tax | (57 | ) | 710 | 536 | 1,369 | ||||||||||||
Tax (expense) benefit | (22 | ) | 270 | 207 | 520 | Provision for income taxes | |||||||||||
Net of tax | $ | (35 | ) | $ | 440 | $ | 329 | $ | 849 | ||||||||
Postretirement benefit plans: | |||||||||||||||||
Amortization of transition obligations | $ | 19 | $ | 20 | $ | 40 | $ | 38 | See note 10 for further details | ||||||||
Amortization of prior service credit | (99 | ) | (86 | ) | (196 | ) | (173 | ) | See note 10 for further details | ||||||||
Recognition of actuarial losses | 1,144 | 749 | 2,351 | 1,470 | See note 10 for further details | ||||||||||||
Total before taxes | 1,064 | 683 | 2,195 | 1,335 | |||||||||||||
Tax benefit | 329 | 185 | 706 | 353 | Provision for income taxes | ||||||||||||
Net of tax | $ | 735 | $ | 498 | $ | 1,489 | $ | 982 | |||||||||
Goodwill_and_Other_Intangible_1
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
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 | Total | ||||||||||||||||
Gross goodwill | $ | 472,337 | $ | 654,081 | $ | 1,126,418 | |||||||||||||
Accumulated impairment losses | (150,842 | ) | — | (150,842 | ) | ||||||||||||||
Balance as of June 30, 2014 | $ | 321,495 | $ | 654,081 | $ | 975,576 | |||||||||||||
Activity for the six months ended December 31, 2014: | |||||||||||||||||||
Acquisition | 2,984 | — | 2,984 | ||||||||||||||||
Translation | (11,082 | ) | (12,911 | ) | (23,993 | ) | |||||||||||||
Change in gross goodwill | (8,098 | ) | (12,911 | ) | (21,009 | ) | |||||||||||||
Impairment charge | — | (375,000 | ) | (375,000 | ) | ||||||||||||||
Gross goodwill | 464,239 | 641,170 | 1,105,409 | ||||||||||||||||
Accumulated impairment losses | (150,842 | ) | (375,000 | ) | (525,842 | ) | |||||||||||||
Balance as of December 31, 2014 | $ | 313,397 | $ | 266,170 | $ | 579,567 | |||||||||||||
The components of intangible assets | The components of our other intangible assets were as follows: | ||||||||||||||||||
Estimated | 31-Dec-14 | 30-Jun-14 | |||||||||||||||||
Useful Life | |||||||||||||||||||
(in thousands) | (in years) | Gross Carrying | Accumulated | Gross Carrying | Accumulated | ||||||||||||||
Amount | Amortization | Amount | Amortization | ||||||||||||||||
Contract-based | 3 to 15 | $ | 8,534 | $ | (7,624 | ) | $ | 23,446 | $ | (10,820 | ) | ||||||||
Technology-based and other | 4 to 20 | 53,657 | (28,361 | ) | 54,842 | (28,516 | ) | ||||||||||||
Customer-related | 10 to 21 | 278,993 | (82,567 | ) | 285,751 | (76,376 | ) | ||||||||||||
Unpatented technology | 10 to 30 | 60,201 | (13,395 | ) | 61,867 | (12,549 | ) | ||||||||||||
Trademarks | 5 to 20 | 18,764 | (11,408 | ) | 19,256 | (10,984 | ) | ||||||||||||
Trademarks | Indefinite | 33,457 | — | 37,259 | — | ||||||||||||||
Total | $ | 453,606 | $ | (143,355 | ) | $ | 482,421 | $ | (139,245 | ) | |||||||||
Segment_Data_Tables
Segment Data (Tables) | 6 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||
Sales and operating income (loss) by segment and segment assets | Our sales and operating income (loss) by segment are as follows: | |||||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Sales: | ||||||||||||||||
Industrial | $ | 371,557 | $ | 370,647 | $ | 749,415 | $ | 708,876 | ||||||||
Infrastructure | 304,074 | 319,289 | 621,157 | 600,867 | ||||||||||||
Total sales | $ | 675,631 | $ | 689,936 | $ | 1,370,572 | $ | 1,309,743 | ||||||||
Operating (loss) income: | ||||||||||||||||
Industrial | $ | 41,795 | $ | 33,218 | $ | 85,812 | $ | 73,038 | ||||||||
Infrastructure (5) | (371,920 | ) | 18,604 | (352,699 | ) | 40,294 | ||||||||||
Corporate | (3,646 | ) | (2,106 | ) | (5,864 | ) | (4,787 | ) | ||||||||
Total operating (loss) income | (333,771 | ) | 49,716 | (272,751 | ) | 108,545 | ||||||||||
Interest expense | 7,960 | 8,037 | 16,170 | 15,118 | ||||||||||||
Other expense, net | 2,223 | 856 | 409 | 1,466 | ||||||||||||
(Loss) income from continuing operations before income taxes | $ | (343,954 | ) | $ | 40,823 | $ | (289,330 | ) | $ | 91,961 | ||||||
(5) See Note 18 regarding Infrastructure segment impairment charges for goodwill and other intangible assets. |
Basis_of_Presentation_Basis_of
Basis of Presentation Basis of Presentation (Details Textual) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2014 |
Basis of Presentation [Abstract] | |
Revision in Cash Flow Statement | $8.40 |
Supplemental_Cash_Flow_Disclos2
Supplemental Cash Flow Disclosures (Details) (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Cash paid during the period for: | ||
Interest | $16,334 | $14,231 |
Income taxes | 24,894 | 24,868 |
Change in accounts payable related to property, plant, and equipment | $6,470 | $8,600 |
Acquisition_Details_1
Acquisition (Details 1) (TMB [Member], USD $) | 6 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 |
TMB [Member] | |
Pro forma (unaudited): | |
Net Sales | $1,451,678 |
Net income attributable to Kennametal | $83,387 |
Per share data attributable to Kennametal : | |
Basic earnings per share | $1.06 |
Diluted earnings per share | $1.05 |
Acquisition_Details_Textual
Acquisition (Details Textual) (TMB [Member], USD $) | 6 Months Ended | |
Dec. 31, 2014 | Nov. 04, 2013 | |
TMB [Member] | ||
Acquisitions (Textual) [Abstract] | ||
Purchase Price | $607,000,000 | |
Net sales | 123,307,000 | |
Net income attributable to Kennametal | ($6,107,000) |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Dec. 31, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives Assets | $9,762 | $253 |
Total assets at fair value | 9,762 | 253 |
Derivatives Liabilities | 120 | 1,053 |
Contingent Consideration | 10,000 | 14,000 |
Total liabilities at fair value | 10,120 | 15,053 |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives Assets | 9,762 | 253 |
Total assets at fair value | 9,762 | 253 |
Derivatives Liabilities | 120 | 1,053 |
Total liabilities at fair value | 120 | 1,053 |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent Consideration | 10,000 | 14,000 |
Total liabilities at fair value | $10,000 | $14,000 |
Fair_Value_Measurments_Details
Fair Value Measurments (Details Textual) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Contingent Consideration Paid | $4,000 |
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 | 2 years |
Derivative_Instruments_and_Hed2
Derivative Instruments and Hedging Activities (Details) (USD $) | Dec. 31, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Fair value of derivatives | ||
Total derivatives designated as hedging instruments | $3,668 | $220 |
Total derivatives not designated as hedging instruments | 5,974 | -1,020 |
Total derivatives | 9,642 | -800 |
Range Forward Contracts [Member] | Designated as Hedging Instrument [Member] | Other Current Assets [Member] | ||
Fair value of derivatives | ||
Derivative assets designated as hedging instruments | 3,668 | 184 |
Range Forward Contracts [Member] | Designated as Hedging Instrument [Member] | Other Current Liabilities [Member] | ||
Fair value of derivatives | ||
Derivative liabilities designated as hedging instruments | 0 | -6 |
Range Forward Contracts [Member] | Designated as Hedging Instrument [Member] | Other Assets [Member] | ||
Fair value of derivatives | ||
Derivative assets designated as hedging instruments | 0 | 42 |
Currency Forward Contracts [Member] | Not Designated as Hedging Instrument [Member] | Other Current Assets [Member] | ||
Fair value of derivatives | ||
Derivative assets designated as hedging instruments | 6,094 | 27 |
Currency Forward Contracts [Member] | Not Designated as Hedging Instrument [Member] | Other Current Liabilities [Member] | ||
Fair value of derivatives | ||
Derivative liabilities designated as hedging instruments | ($120) | ($1,047) |
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, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Currency Forward Contracts [Member] | Other Expense Income Net [Member] | Not Designated as Hedging Instrument [Member] | ||||
Derivative Instruments, (Gain )Loss Recognized in Income, Net | ||||
Other (income) expense, net - currency forward contracts | ($2,273) | $72 | ($7,169) | $114 |
Range Forward Contracts [Member] | Cash flow hedging [Member] | ||||
(Gains) losses related to cash flow hedges | ||||
Gains (losses) recognized in other comprehensive loss, net | 1,205 | -273 | 2,712 | -843 |
Losses reclassified from accumulated other comprehensive loss into other expense (income), net | $152 | $324 | $502 | $714 |
Derivative_Instruments_and_Hed4
Derivative Instruments and Hedging Activities (Details Textual) (USD $) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
Feb. 28, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Feb. 14, 2012 | |
Derivative Instruments and Hedging Activities (Textual) [Abstract] | |||||||
Recognize loss on outstanding derivatives in the next 12 months | $2,300,000 | $2,300,000 | |||||
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 | 22,400,000 | ||||||
Contracts translated to US dollars [Member] | |||||||
Additional Derivative Instruments and Hedging Activities (Textual) [Abstract] | |||||||
Notional amount of the contracts translated into U.S. dollars | 57,000,000 | 57,000,000 | 91,100,000 | ||||
Forward Starting Interest Rate Swap Contracts [Member] | |||||||
Additional Derivative Instruments and Hedging Activities (Textual) [Abstract] | |||||||
Notional amount of the contracts translated into U.S. dollars | 150,000,000 | ||||||
Derivative, Loss on Derivative | $505,000 | $500,000 | $1,010,000 | $1,000,000 |
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 Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Forward Starting Interest Rate Swap Contracts [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Interest expense | $505 | $500 | $1,010 | $1,000 |
Restructuring_Details
Restructuring (Details) (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Restructuring Reserve [Abstract] | ||
Beginning Balance | $9,002 | |
Restructuring Charges | 8,613 | 2,310 |
Asset Write-Down | -1,030 | |
Reclass of Special Termination Benefit Charges | -459 | |
Translation | -646 | |
Cash Expenditures | -9,727 | |
Ending Balance | 5,753 | |
Industrial [Member] | ||
Restructuring Reserve [Abstract] | ||
Beginning Balance | 6,326 | |
Restructuring Charges | 3,871 | |
Asset Write-Down | -489 | |
Reclass of Special Termination Benefit Charges | 0 | |
Translation | -306 | |
Cash Expenditures | -4,766 | |
Ending Balance | 4,636 | |
Industrial [Member] | Severance [Member] | ||
Restructuring Reserve [Abstract] | ||
Beginning Balance | 5,815 | |
Restructuring Charges | 3,361 | |
Asset Write-Down | 0 | |
Reclass of Special Termination Benefit Charges | 0 | |
Translation | -282 | |
Cash Expenditures | -4,291 | |
Ending Balance | 4,603 | |
Industrial [Member] | Facilities [Member] | ||
Restructuring Reserve [Abstract] | ||
Beginning Balance | 444 | |
Restructuring Charges | 489 | |
Asset Write-Down | -489 | |
Reclass of Special Termination Benefit Charges | 0 | |
Translation | -22 | |
Cash Expenditures | -389 | |
Ending Balance | 33 | |
Industrial [Member] | Other [Member] | ||
Restructuring Reserve [Abstract] | ||
Beginning Balance | 67 | |
Restructuring Charges | 21 | |
Asset Write-Down | 0 | |
Reclass of Special Termination Benefit Charges | 0 | |
Translation | -2 | |
Cash Expenditures | -86 | |
Ending Balance | 0 | |
Infrastructure [Member] | ||
Restructuring Reserve [Abstract] | ||
Beginning Balance | 2,676 | |
Restructuring Charges | 4,742 | |
Asset Write-Down | -541 | |
Reclass of Special Termination Benefit Charges | -459 | |
Translation | -340 | |
Cash Expenditures | -4,961 | |
Ending Balance | 1,117 | |
Infrastructure [Member] | Severance [Member] | ||
Restructuring Reserve [Abstract] | ||
Beginning Balance | 2,458 | |
Restructuring Charges | 4,177 | |
Asset Write-Down | 0 | |
Reclass of Special Termination Benefit Charges | -459 | |
Translation | -312 | |
Cash Expenditures | -4,747 | |
Ending Balance | 1,117 | |
Infrastructure [Member] | Facilities [Member] | ||
Restructuring Reserve [Abstract] | ||
Beginning Balance | 190 | |
Restructuring Charges | 542 | |
Asset Write-Down | -541 | |
Reclass of Special Termination Benefit Charges | 0 | |
Translation | -25 | |
Cash Expenditures | -166 | |
Ending Balance | 0 | |
Infrastructure [Member] | Other [Member] | ||
Restructuring Reserve [Abstract] | ||
Beginning Balance | 28 | |
Restructuring Charges | 23 | |
Asset Write-Down | 0 | |
Reclass of Special Termination Benefit Charges | 0 | |
Translation | -3 | |
Cash Expenditures | -48 | |
Ending Balance | $0 |
Restructuring_and_Related_Char1
Restructuring and Related Charges (Details Textual) (USD $) | 6 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Incurred Cost | $20,381,000 | |
Restructuring Charges | 8,613,000 | 2,310,000 |
Restructuring Charges Related to Inventory Disposals | 211,000 | |
Restructuring Related Charges Recorded in Cost of Goods Sold | 6,300,000 | |
Restructuring Related Charges Recorded in Operating Expenses | 5,518,000 | |
Restructuring and Related Cost, Cost Incurred to Date | 39,462,000 | |
Minimum [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Expected Cost | 55,000,000 | |
Maximum [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Expected Cost | 60,000,000 | |
Industrial [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Charges | 3,871,000 | |
Restructuring and Related Cost, Expected Cost Percent | 50.00% | |
Restructuring and Related Cost, Cost Incurred to Date | 24,521,000 | |
Infrastructure [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Charges | 4,742,000 | |
Restructuring and Related Cost, Expected Cost Percent | 50.00% | |
Restructuring and Related Cost, Cost Incurred to Date | 13,097,000 | |
Corporate Segment [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | $1,844,000 |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (Stock Option [Member]) | 6 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | |||
Stock Option [Member] | ||||
Assumptions used in valuation of stock options | ||||
Risk-free interest rate | 1.50% | 1.30% | ||
Expected life | 4 years 6 months | [1] | 4 years 6 months | [1] |
Expected volatility | 32.50% | [2] | 40.40% | [2] |
Expected dividend yield | 1.60% | 1.50% | ||
[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, 2014 | |
Changes in stock options | |
Options outstanding, June 30, 2014 | 2,264,824 |
Options, Granted | 436,541 |
Options, Exercised | -222,206 |
Options, Lapsed and Forfeited | -11,905 |
Options outstanding, December 31, 2014 | 2,467,254 |
Options vested and expected to vest, December 31, 2014 | 2,206,567 |
Options exercisable, December 31, 2014 | 1,600,847 |
Weighted Average Exercise Price, Options outstanding, June 30, 2014 | $33.95 |
Weighted Average Exercise Price, Granted | $40.81 |
Weighted Average Exercise Price, Exercised | $27.54 |
Weighted Average Exercise Price, Lapsed and Forfeited | $41.10 |
Weighted Average Exercise Price, Options outstanding, December 31, 2014 | $35.71 |
Weighted Average Exercise Price, Option vested and expected to vest, December 31, 2014 | $35.02 |
Weighted Average Exercise Price, Options exercisable, December 31, 2014 | $32.76 |
Weighted Average Remaining Life, Options outstanding, December 31, 2014 | 5 years 3 months |
Weighted Average Remaining Life, Options vested and expected to vest, December 31, 2014 | 5 years 5 months |
Weighted Average Remaining Life, Options exercisable, December 31, 2014 | 4 years 1 month |
Aggregate Intrinsic value, Options outstanding, December 31, 2014 | $7,580,000 |
Aggregate Intrinsic Value, Options vested and expected to vest, December 31, 2014 | 7,578,000 |
Aggregate Intrinsic Value, Options exercisable, December 31, 2014 | $7,562,000 |
StockBased_Compensation_Detail2
Stock-Based Compensation (Details 2) (USD $) | 6 Months Ended |
Dec. 31, 2014 | |
Restricted Stock Units - Performance Vesting [Member] | |
Changes in restricted stock awards | |
Unvested restricted stock awards, June 30, 2014, Shares | 197,356 |
Granted, Shares | 88,536 |
Vested, Shares | -28,022 |
Performance Metric Not Achieved, Shares | -65,373 |
Forfeited, Shares | 0 |
Unvested restricted stock awards, December 31, 2014 | 192,497 |
Weighted Average Fair Value, Unvested restricted stock awards, June 30, 2014 | $40.92 |
Weighted Average Fair Value, Granted | $43.16 |
Weighted Average Fair Value, Vested | $38.95 |
Weighted Average Fair Value, Performance Metric Not Achieved | $43.16 |
Weighted Average Fair Value, Forfeited | $0 |
Weighted Average Fair Value, Unvested restricted stock awards, December 31, 2014 | $42.98 |
Restricted Stock Units - Time Vesting [Member] | |
Changes in restricted stock awards | |
Unvested restricted stock awards, June 30, 2014, Shares | 743,326 |
Granted, Shares | 438,795 |
Vested, Shares | -306,484 |
Forfeited, Shares | -25,471 |
Unvested restricted stock awards, December 31, 2014 | 850,166 |
Weighted Average Fair Value, Unvested restricted stock awards, June 30, 2014 | $39.20 |
Weighted Average Fair Value, Granted | $42.27 |
Weighted Average Fair Value, Vested | $36.26 |
Weighted Average Fair Value, Forfeited | $41.69 |
Weighted Average Fair Value, Unvested restricted stock awards, December 31, 2014 | $41.78 |
StockBased_Compensation_Detail3
Stock-Based Compensation (Details Textual) (USD $) | 6 Months Ended | |
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
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 | $2.80 | $3.50 |
Unrecognized compensation cost | 3.7 | |
Unrecognized compensation costs, weighted average period | 2 years 10 months | |
Weighted average fair value of options granted | $10.16 | $13.79 |
Share Based Compensation Arrangement by Share Based Payment Award Options Vested in Period | 6.9 | 5 |
Tax benefits resulting from stock-based compensation deductions in excess of amounts reported for financial reporting purposes | 1.3 | 4.5 |
Cash received from the exercise of capital stock option | 6.1 | 12.7 |
Tax benefit from the exercise of capital stock option | 1.3 | 2.7 |
Total Intrinsic value of options exercised | 3.4 | 9.2 |
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 | 10.6 | 8.4 |
Unrecognized compensation cost | $21.30 | |
Unrecognized compensation costs, weighted average period | 2 years 8 months 10 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, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Pension plans contribution [Member] | ||||
Net periodic pension income | ||||
Service cost | $1,384 | $1,732 | $2,799 | $3,448 |
Interest cost | 9,745 | 10,308 | 19,681 | 20,484 |
Expected return on plan assets | -14,900 | -14,916 | -29,947 | -29,712 |
Amortization of transition obligation | 19 | 20 | 40 | 38 |
Amortization of prior service credit | -71 | -58 | -141 | -117 |
Recognition of actuarial losses | 937 | 670 | 1,937 | 1,312 |
Recognized Net Loss (Gain) Due to Curtailments | 358 | 0 | 358 | 0 |
Special Termination Benefits Charge | 459 | 0 | 459 | 0 |
Net periodic pension income | ($2,069) | ($2,244) | ($4,814) | ($4,547) |
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, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Other postretirement benefit plans [Member] | ||||
Net periodic other postretirement benefit costs | ||||
Service cost | $27 | $14 | $54 | $28 |
Interest cost | 259 | 251 | 519 | 502 |
Amortization of prior service credit | -28 | -28 | -55 | -56 |
Recognition of actuarial loss (gains) | 207 | 79 | 414 | 158 |
Recognized Net Loss (Gain) Due to Curtailments | 221 | 0 | 221 | 0 |
Net periodic other postretirement benefit cost | $244 | $316 | $711 | $632 |
Benefit_Plans_Benefit_Plans_De
Benefit Plans Benefit Plans (Details Textual) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Pension Plan [Member] | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Special Termination Benefits Charge | $459 | $0 | $459 | $0 |
Recognized Net Loss (Gain) Due to Curtailments | 358 | 0 | 358 | 0 |
Other Postretirement Benefit Plan [Member] | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Recognized Net Loss (Gain) Due to Curtailments | ($221) | $0 | ($221) | $0 |
Inventories_Details
Inventories (Details) (USD $) | Dec. 31, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Inventories | ||
Finished goods | $362,979 | $371,599 |
Work in process and powder blends | 286,841 | 308,129 |
Raw materials | 110,756 | 126,004 |
Inventories at current cost | 760,576 | 805,732 |
Less: LIFO valuation | -97,693 | -101,966 |
Total inventories | $662,883 | $703,766 |
Inventories (Textual) [Abstract] | ||
Percentage of inventories valued by using LIFO method | 47.00% | 43.00% |
Long_Term_Debt_Details_Textual
Long -Term Debt (Details Textual) (USD $) | Dec. 31, 2014 | Jun. 30, 2014 | Oct. 21, 2011 |
In Millions, unless otherwise specified | |||
Long-Term Debt (Additional Textual) [Abstract] | |||
Fixed rate at fair market value | $703.30 | $705.30 | |
2011 Credit Agreement [Member] | |||
Long-Term Debt (Textual) [Abstract] | |||
Borrowing outstanding under 2011 Credit Agreement | 174.1 | 287.1 | |
Line of Credit Facility, Maximum Borrowing Capacity | $600 |
Environmental_Matters_Details_
Environmental Matters (Details Textual) (USD $) | Dec. 31, 2014 | Jun. 30, 2014 |
In Millions, unless otherwise specified | ||
Environmental Remediation Obligations [Abstract] | ||
Reserves for Environmental Costs | $12.60 | $11 |
Income_Taxes_Details_Textual
Income Taxes (Details Textual) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax (Textual) [Abstract] | ||||
Effective tax rate | -12.70% | 40.80% | -20.10% | 31.80% |
Earnings_Per_Shares_Details
Earnings Per Shares (Details) | 3 Months Ended | 6 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2013 |
Earnings Per Share (Textual) [Abstract] | ||
Increase in weighted average shares due to dilutive effect of unexercised capital stock options and unvested restricted stock units | 1 | 1 |
Unexercised capital stock options and restricted stock units excluded from computation of diluted EPS | 0.2 | 0.3 |
Equity_Details
Equity (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Beginning Balance | $1,961,608 | $1,812,293 | ||
Net (loss) income | -387,705 | 24,167 | -347,578 | 62,725 |
Other comprehensive (loss) income | -71,626 | 37,798 | ||
Dividend reinvestment | 168 | 152 | ||
Capital stock issued under employee benefit and stock plans | 16,681 | 22,982 | ||
Purchase of capital stock | -168 | -4,400 | ||
Cash dividends paid | -28,498 | -28,246 | ||
Ending Balance | 1,530,587 | 1,903,304 | 1,530,587 | 1,903,304 |
Capital stock [Member] | ||||
Beginning Balance | 98,340 | 97,303 | ||
Dividend reinvestment | 5 | 3 | ||
Capital stock issued under employee benefit and stock plans | 592 | 1,056 | ||
Purchase of capital stock | -5 | -128 | ||
Ending Balance | 98,932 | 98,234 | 98,932 | 98,234 |
Additional paid-in capital [Member] | ||||
Beginning Balance | 395,890 | 374,300 | ||
Dividend reinvestment | 163 | 149 | ||
Capital stock issued under employee benefit and stock plans | 16,089 | 21,926 | ||
Purchase of capital stock | -163 | -4,272 | ||
Ending Balance | 411,979 | 392,103 | 411,979 | 392,103 |
Retained earnings [Member] | ||||
Beginning Balance | 1,501,157 | 1,399,227 | ||
Net (loss) income | -348,814 | 62,046 | ||
Cash dividends paid | -28,451 | -28,180 | ||
Ending Balance | 1,123,892 | 1,433,093 | 1,123,892 | 1,433,093 |
Accumulated other comprehensive (loss) income [Member] | ||||
Beginning Balance | -66,131 | -89,004 | ||
Other comprehensive (loss) income | -69,352 | 37,571 | ||
Ending Balance | -135,483 | -51,433 | -135,483 | -51,433 |
Non-controlling interest [Member] | ||||
Beginning Balance | 32,352 | 30,467 | ||
Net (loss) income | 1,236 | 679 | ||
Other comprehensive (loss) income | -2,274 | 227 | ||
Cash dividends paid | -47 | -66 | ||
Ending Balance | $31,267 | $31,307 | $31,267 | $31,307 |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive (Loss) Income (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Accumulated Other Comprehensive (Loss) Income [Line Items] | ||||
Accumulated Other Comprehensive (Loss) Income, Net of Tax | ($109,886) | ($62,551) | ($66,131) | ($89,004) |
Other comprehensive (loss) income before reclassifications | -26,297 | 10,180 | -71,170 | 35,740 |
Amounts reclassified from accumulated other comprehensive loss | 700 | 938 | 1,818 | 1,831 |
Net current period other comprehensive (loss) income | -25,597 | 11,118 | -69,352 | 37,571 |
Accumulated Other Comprehensive (Loss) Income, Net of Tax | -135,483 | -51,433 | -135,483 | -51,433 |
Accumulated Defined Benefit Plans Adjustment [Member] | ||||
Accumulated Other Comprehensive (Loss) Income [Line Items] | ||||
Accumulated Other Comprehensive (Loss) Income, Net of Tax | -89,347 | -85,419 | -93,742 | -83,937 |
Other comprehensive (loss) income before reclassifications | 1,924 | -810 | 5,565 | -2,776 |
Amounts reclassified from accumulated other comprehensive loss | 735 | 498 | 1,489 | 982 |
Net current period other comprehensive (loss) income | 2,659 | -312 | 7,054 | -1,794 |
Accumulated Other Comprehensive (Loss) Income, Net of Tax | -86,688 | -85,731 | -86,688 | -85,731 |
Accumulated Translation Adjustment [Member] | ||||
Accumulated Other Comprehensive (Loss) Income [Line Items] | ||||
Accumulated Other Comprehensive (Loss) Income, Net of Tax | -11,210 | 35,510 | 38,811 | 7,414 |
Other comprehensive (loss) income before reclassifications | -29,427 | 11,263 | -79,448 | 39,359 |
Net current period other comprehensive (loss) income | -29,427 | 11,263 | -79,448 | 39,359 |
Accumulated Other Comprehensive (Loss) Income, Net of Tax | -40,637 | 46,773 | -40,637 | 46,773 |
Accumulated Net (Loss) Gain from Designated or Qualifying Cash Flow Hedges [Member] | ||||
Accumulated Other Comprehensive (Loss) Income [Line Items] | ||||
Accumulated Other Comprehensive (Loss) Income, Net of Tax | -9,329 | -12,642 | -11,200 | -12,481 |
Other comprehensive (loss) income before reclassifications | 1,206 | -273 | 2,713 | -843 |
Amounts reclassified from accumulated other comprehensive loss | -35 | 440 | 329 | 849 |
Net current period other comprehensive (loss) income | 1,171 | 167 | 3,042 | 6 |
Accumulated Other Comprehensive (Loss) Income, Net of Tax | -8,158 | -12,475 | -8,158 | -12,475 |
Noncontrolling Interest [Member] | ||||
Accumulated Other Comprehensive (Loss) Income [Line Items] | ||||
Accumulated Other Comprehensive (Loss) Income, Net of Tax | -405 | 535 | 1,087 | 721 |
Other comprehensive (loss) income before reclassifications | -782 | 413 | -2,274 | 227 |
Net current period other comprehensive (loss) income | -782 | 413 | -2,274 | 227 |
Accumulated Other Comprehensive (Loss) Income, Net of Tax | ($1,187) | $948 | ($1,187) | $948 |
Accumulated_Other_Comprehensiv3
Accumulated Other Comprehensive (Loss) Income (Details 1) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Reclassification Adjustment out of Accumulated Other Comprehensive Loss [Line Items] | ||||
Loss on currency exchange contracts reclassified from accumulated other comprehensive loss into other expense (income), net | ($2,223) | ($856) | ($409) | ($1,466) |
Income tax benefit relating to reclassification out of accumulated other comprehensive loss | 43,751 | 16,656 | 58,248 | 29,236 |
Forward Starting Interest Rate Swap Contracts [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Loss [Line Items] | ||||
Derivative, Loss on Derivative | 505 | 500 | 1,010 | 1,000 |
Reclassification out of Accumulated Other Comprehensive Loss[Member] | Accumulated Net (Loss) Gain from Designated or Qualifying Cash Flow Hedges [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Loss [Line Items] | ||||
Total before tax | -57 | 710 | 536 | 1,369 |
Income tax benefit relating to reclassification out of accumulated other comprehensive loss | -22 | 270 | 207 | 520 |
Net of tax | -35 | 440 | 329 | 849 |
Reclassification out of Accumulated Other Comprehensive Loss[Member] | Accumulated Defined Benefit Plans Adjustment [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Loss [Line Items] | ||||
Reclassification out of accumulated other comprehensive loss, pension and other postretirement benefit plans, amortization of transition obligations | 19 | 20 | 40 | 38 |
Reclassification out of accumulated other comprehensive loss, Pension and Other Postretirement Benefit Plans, for amortization of prior service credit | -99 | -86 | -196 | -173 |
Reclassification out of accumulated other comprehensive loss, Pension and Other Postretirement Benefit Plans, for actuarial losses | 1,144 | 749 | 2,351 | 1,470 |
Total before tax | 1,064 | 683 | 2,195 | 1,335 |
Income tax benefit relating to reclassification out of accumulated other comprehensive loss | 329 | 185 | 706 | 353 |
Net of tax | 735 | 498 | 1,489 | 982 |
Reclassification out of Accumulated Other Comprehensive Loss[Member] | Forward Starting Interest Rate Swap Contracts [Member] | Accumulated Net (Loss) Gain from Designated or Qualifying Cash Flow Hedges [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Loss [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 Loss[Member] | Currency Forward Contracts [Member] | Accumulated Net (Loss) Gain from Designated or Qualifying Cash Flow Hedges [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Loss [Line Items] | ||||
Loss on currency exchange contracts reclassified from accumulated other comprehensive loss into other expense (income), net | ($562) | $224 | ($474) | $396 |
Goodwill_and_Other_Intangible_2
Goodwill and Other Intangible Assets (Details) (USD $) | 6 Months Ended | |
Dec. 31, 2014 | Jun. 30, 2014 | |
Goodwill [Roll Forward] | ||
Goodwill | $1,105,409,000 | $1,126,418,000 |
Accumulated impairment losses | -525,842,000 | -150,842,000 |
Goodwill, Beginning Balance | 975,576,000 | |
Goodwill, Acquired During Period | 2,984,000 | |
Translation | -23,993,000 | |
Change in goodwill | -21,009,000 | |
Goodwill, Impairment Loss | -375,000,000 | |
Goodwill, Ending Balance | 579,567,000 | |
Industrial [Member] | ||
Goodwill [Roll Forward] | ||
Goodwill | 464,239,000 | 472,337,000 |
Accumulated impairment losses | -150,842,000 | -150,842,000 |
Goodwill, Beginning Balance | 321,495,000 | |
Goodwill, Acquired During Period | 2,984,000 | |
Translation | -11,082,000 | |
Change in goodwill | -8,098,000 | |
Goodwill, Impairment Loss | 0 | |
Goodwill, Ending Balance | 313,397,000 | |
Infrastructure [Member] | ||
Goodwill [Roll Forward] | ||
Goodwill | 641,170,000 | 654,081,000 |
Accumulated impairment losses | -375,000,000 | 0 |
Goodwill, Beginning Balance | 654,081,000 | |
Goodwill, Acquired During Period | 0 | |
Translation | -12,911,000 | |
Change in goodwill | -12,911,000 | |
Goodwill, Impairment Loss | -375,000,000 | |
Goodwill, Ending Balance | $266,170,000 |
Goodwill_and_Other_Intangible_3
Goodwill and Other Intangible Assets (Details 1) (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Jun. 30, 2014 |
The components of intangible assets | ||
Accumulated amortization | -143,355 | ($139,245) |
Intangible Assets, Gross (Excluding Goodwill) | 453,606 | 482,421 |
Trademarks [Member] | ||
The components of intangible assets | ||
Gross carrying amount, Indefinite | 33,457 | 37,259 |
Contract-based [Member] | ||
The components of intangible assets | ||
Gross carrying amount, finite | 8,534 | 23,446 |
Accumulated amortization | -7,624 | -10,820 |
Technology-based and other [Member] | ||
The components of intangible assets | ||
Gross carrying amount, finite | 53,657 | 54,842 |
Accumulated amortization | -28,361 | -28,516 |
Customer-related [Member] | ||
The components of intangible assets | ||
Gross carrying amount, finite | 278,993 | 285,751 |
Accumulated amortization | -82,567 | -76,376 |
Unpatented technology [Member] | ||
The components of intangible assets | ||
Gross carrying amount, finite | 60,201 | 61,867 |
Accumulated amortization | -13,395 | -12,549 |
Trademarks [Member] | ||
The components of intangible assets | ||
Gross carrying amount, finite | 18,764 | 19,256 |
Accumulated amortization | -11,408 | ($10,984) |
Minimum [Member] | Contract-based [Member] | ||
The components of intangible assets | ||
Useful life related to technology-based intangible assets | 3 years | |
Minimum [Member] | Technology-based and other [Member] | ||
The components of intangible assets | ||
Useful life related to technology-based intangible assets | 4 years | |
Minimum [Member] | Customer-related [Member] | ||
The components of intangible assets | ||
Useful life related to technology-based intangible assets | 10 years | |
Minimum [Member] | Unpatented technology [Member] | ||
The components of intangible assets | ||
Useful life related to technology-based intangible assets | 10 years | |
Minimum [Member] | Trademarks [Member] | ||
The components of intangible assets | ||
Useful life related to technology-based intangible assets | 5 years | |
Maximum [Member] | Contract-based [Member] | ||
The components of intangible assets | ||
Useful life related to technology-based intangible assets | 15 years | |
Maximum [Member] | Technology-based and other [Member] | ||
The components of intangible assets | ||
Useful life related to technology-based intangible assets | 20 years | |
Maximum [Member] | Customer-related [Member] | ||
The components of intangible assets | ||
Useful life related to technology-based intangible assets | 21 years | |
Maximum [Member] | Unpatented technology [Member] | ||
The components of intangible assets | ||
Useful life related to technology-based intangible assets | 30 years | |
Maximum [Member] | Trademarks [Member] | ||
The components of intangible assets | ||
Useful life related to technology-based intangible assets | 20 years |
Goodwill_and_Other_Intangible_4
Goodwill and Other Intangible Assets (Details Textual) (USD $) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | |
Goodwill and Other Intangible Assets (Additional Textual) [Abstract] | |||||
Goodwill, Impairment Loss | $375,000,000 | ||||
Goodwill | 579,567,000 | 579,567,000 | 975,576,000 | ||
Amortization expense for intangible assets | 6,931,000 | 6,524,000 | 13,959,000 | 11,667,000 | |
Unfavorable foreign currency translation adjustment | -7,100,000 | ||||
Infrastructure [Member] | |||||
Goodwill and Other Intangible Assets (Additional Textual) [Abstract] | |||||
Goodwill and Intangible Asset Impairment | 376,500,000 | ||||
Goodwill, Impairment Loss | 375,000,000 | ||||
Goodwill | 266,170,000 | 266,170,000 | 654,081,000 | ||
Infrastructure [Member] | Infrastructure Technology Asset [Member] | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Intangible Asset Write-Down | 10,500,000 | ||||
Goodwill and Other Intangible Assets (Additional Textual) [Abstract] | |||||
Impairment of Intangible Assets (Excluding Goodwill) | 5,500,000 | ||||
Reduction of Liability | 5,000,000 | ||||
Infrastructure [Member] | Minimum [Member] | Portfolio of Businesses for Strategic Alternatives [Member] | |||||
Goodwill and Other Intangible Assets (Additional Textual) [Abstract] | |||||
Net Book Value | 150,000,000 | 150,000,000 | |||
Infrastructure [Member] | Maximum [Member] | Portfolio of Businesses for Strategic Alternatives [Member] | |||||
Goodwill and Other Intangible Assets (Additional Textual) [Abstract] | |||||
Net Book Value | 200,000,000 | 200,000,000 | |||
Infrastructure [Member] | Infrastructure Indefinite-Lived Trademark Asset [Member] | |||||
Goodwill and Other Intangible Assets (Additional Textual) [Abstract] | |||||
Impairment of Intangible Assets (Excluding Goodwill) | $1,500,000 |
Segment_Data_Details
Segment Data (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
External sales: | ||||
Total sales | $675,631 | $689,936 | $1,370,572 | $1,309,743 |
Operating income: | ||||
Total operating (loss) income | -333,771 | 49,716 | -272,751 | 108,545 |
Interest expense | 7,960 | 8,037 | 16,170 | 15,118 |
Other expense, net | 2,223 | 856 | 409 | 1,466 |
(Loss) income before income taxes | -343,954 | 40,823 | -289,330 | 91,961 |
Industrial [Member] | ||||
External sales: | ||||
Total sales | 371,557 | 370,647 | 749,415 | 708,876 |
Operating income: | ||||
Total operating (loss) income | 41,795 | 33,218 | 85,812 | 73,038 |
Infrastructure [Member] | ||||
External sales: | ||||
Total sales | 304,074 | 319,289 | 621,157 | 600,867 |
Operating income: | ||||
Total operating (loss) income | -371,920 | 18,604 | -352,699 | 40,294 |
Corporate [Member] | ||||
Operating income: | ||||
Total operating (loss) income | ($3,646) | ($2,106) | ($5,864) | ($4,787) |