Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jul. 29, 2016 | Dec. 31, 2015 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | KENNAMETAL INC | ||
Entity Central Index Key | 55,242 | ||
Document Type | 10-K | ||
Document Period End Date | Jun. 30, 2016 | ||
Amendment Flag | false | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 1,033,300,000 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 79,700,981 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Statement [Abstract] | |||
Sales | $ 2,098,436 | $ 2,647,195 | $ 2,837,190 |
Cost of goods sold | 1,482,369 | 1,841,202 | 1,940,187 |
Gross profit | 616,067 | 805,993 | 897,003 |
Operating expense | 494,975 | 554,895 | 589,768 |
Restructuring and asset impairment charges (Notes 2 and 15) | 143,810 | 582,235 | 17,608 |
Loss on divestiture (Note 4) | 131,463 | 0 | 0 |
Amortization of Intangible Assets | 20,762 | 26,686 | 26,195 |
Operating (loss) income | (174,943) | (357,823) | 263,432 |
Interest expense | 27,752 | 31,466 | 32,451 |
Other (income) expense, net | (4,124) | (1,674) | 2,172 |
(Loss) income before income taxes | (198,571) | (387,615) | 228,809 |
Provision (benefit) for income taxes | 25,313 | (16,654) | 66,611 |
Net (loss) income | (223,884) | (370,961) | 162,198 |
Less: Net income attributable to noncontrolling interests | 2,084 | 2,935 | 3,832 |
Net (loss) income attributable to Kennametal | $ (225,968) | $ (373,896) | $ 158,366 |
PER SHARE DATA ATTRIBUTABLE TO KENNAMETAL SHAREHOLDERS | |||
Basic (loss) earnings per share | $ (2.83) | $ (4.71) | $ 2.01 |
Diluted (loss) earnings per share | (2.83) | (4.71) | 1.99 |
Dividends per share | $ 0.80 | $ 0.72 | $ 0.72 |
Basic weighted average shares outstanding | 79,835 | 79,342 | 78,678 |
Diluted weighted average shares outstanding | 79,835 | 79,342 | 79,667 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net (loss) income | $ (223,884) | $ (370,961) | $ 162,198 |
Unrealized (loss) gain on derivatives designated and qualified as cash flow hedges | (150) | 6,652 | (706) |
Reclassification of unrealized (gain) loss on expired derivatives designated and qualified as cash flow hedges | (1,563) | (2,873) | 1,987 |
Unrecognized net pension and other postretirement benefit loss | (78,295) | (47,982) | (11,990) |
Reclassification of net pension and other postretirement benefit loss | 4,925 | 2,931 | 2,184 |
Foreign currency translation adjustments | (52,695) | (139,465) | 31,763 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, Net of Tax | 15,088 | 0 | 0 |
Other comprehensive (loss) income, net of tax | (112,690) | (180,737) | 23,238 |
Total comprehensive (loss) income | (336,574) | (551,698) | 185,436 |
Less: comprehensive income (loss) attributable to noncontrolling interests | (896) | 410 | (4,198) |
Comprehensive (loss) income attributable to Kennametal Shareholders | $ (337,470) | $ (551,288) | $ 181,238 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 161,579 | $ 105,494 |
Accounts receivable, less allowance for doubtful accounts of $12,724 and $13,560, respectively | 370,916 | 445,373 |
Inventories (Note 7) | 458,830 | 575,531 |
Deferred income taxes (Note 12) | 26,713 | 72,449 |
Other current assets | 57,303 | 59,699 |
Total current assets | 1,075,341 | 1,258,546 |
Property, plant and equipment: | ||
Land and buildings | 353,789 | 401,207 |
Machinery and equipment | 1,511,462 | 1,573,597 |
Less accumulated depreciation | (1,134,611) | (1,158,979) |
Property, plant and equipment, net | 730,640 | 815,825 |
Other assets: | ||
Investments in affiliated companies | 2 | 361 |
Goodwill (Notes 2 and 8) | 298,487 | 417,389 |
Other intangible assets, less accumulated amortization of $114,093 and $153,370, respectively (Notes 2 and 8) | 207,208 | 286,669 |
Deferred income taxes (Note 12) | 14,459 | 24,091 |
Other | 42,656 | 46,648 |
Total other assets | 562,812 | 775,158 |
Total assets | 2,368,793 | 2,849,529 |
Current liabilities: | ||
Current maturities of long-term debt and capital leases (Note 10) | 732 | 8,129 |
Notes payable to banks (Note 11) | 1,163 | 7,573 |
Accounts payable | 182,039 | 187,381 |
Accrued income taxes | 16,602 | 25,237 |
Accrued vacation pay | 24,709 | 26,566 |
Accrued payroll | 49,761 | 49,180 |
Other current liabilities (Note 9) | 152,269 | 178,678 |
Total current liabilities | 427,275 | 482,744 |
Long-term debt and capital leases, less current maturities (Note 10) | 699,558 | 735,885 |
Deferred income taxes (Note 12) | 17,126 | 59,744 |
Accrued postretirement benefits (Note 13) | 18,876 | 19,230 |
Accrued pension benefits (Note 13) | 182,597 | 143,799 |
Accrued income taxes | 3,100 | 3,002 |
Other liabilities | 24,460 | 29,690 |
Total liabilities | 1,372,992 | 1,474,094 |
Commitments and contingencies (Note 19) | ||
Kennametal Shareholders' Equity: | ||
Preferred stock, no par value; 5,000 shares authorized; none issued | 0 | 0 |
Capital stock, $1.25 par value; 120,000 shares authorized; 79,694 and 79,375 shares issued respectively | 99,618 | 99,219 |
Additional paid-in capital | 436,617 | 419,829 |
Retained earnings | 780,597 | 1,070,282 |
Accumulated other comprehensive loss | (352,509) | (243,523) |
Total Kennametal Shareholders' Equity | 964,323 | 1,345,807 |
Noncontrolling interests | 31,478 | 29,628 |
Total equity | 995,801 | 1,375,435 |
Total liabilities and equity | $ 2,368,793 | $ 2,849,529 |
Consolidated Balance Sheets(Par
Consolidated Balance Sheets(Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 12,724 | $ 13,560 |
Accumulated amortization on other intangible assets | $ 114,093 | $ 153,370 |
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 | 79,694 | 79,375 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOW - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
OPERATING ACTIVITIES | |||
Net (loss) income | $ (223,884) | $ (370,961) | $ 162,198 |
Adjustments for non-cash items: | |||
Depreciation | 96,704 | 104,978 | 104,027 |
Amortization | 20,762 | 26,686 | 26,195 |
Stock-based compensation expense | 18,129 | 16,827 | 17,641 |
Restructuring and asset impairment charges (Notes 2 and 15) | 118,779 | 548,028 | 3,408 |
Loss on divestiture (Note 4) | 131,124 | 0 | 0 |
Deferred income tax provision | 8,328 | (48,575) | 23,119 |
Other | (6,113) | 2,098 | 2,106 |
Changes in certain assets and liabilities: | |||
Accounts receivable | 32,661 | 46,552 | (45,041) |
Inventories | 69,552 | 70,874 | (5,310) |
Accounts payable and accrued liabilities | (2,180) | (8,218) | 13,748 |
Accrued income taxes | (25,247) | (10,163) | (12,485) |
Accrued pension and postretirement benefits | (15,013) | 4,863 | (16,592) |
Other | (4,280) | (31,552) | (1,141) |
Net cash flow provided by operating activities | 219,322 | 351,437 | 271,873 |
INVESTING ACTIVITIES | |||
Purchases of property, plant and equipment | (110,697) | (100,939) | (117,376) |
Disposals of property, plant and equipment | 5,978 | 16,122 | 1,236 |
Business acquisition, net of cash acquired (Note 4) | 0 | 0 | (634,615) |
Proceeds from Divestiture of Businesses, Net of Cash Divested | 56,127 | 0 | 10,225 |
Other | 659 | 263 | 356 |
Net cash flow used for investing activities | (47,933) | (84,554) | (740,174) |
FINANCING ACTIVITIES | |||
Net (decrease) increase in notes payable | (6,288) | (63,647) | 31,568 |
Net increase (decrease) in short-term revolving and other lines of credit | 0 | 200 | (3,600) |
Term debt borrowings | 50,070 | 89,712 | 736,079 |
Term debt repayments | (94,577) | (308,736) | (450,928) |
Purchase of capital stock | (295) | (318) | (14,165) |
Dividend reinvestment and the effect of employee benefit and stock plans | 4,519 | 13,844 | 26,676 |
Cash dividends paid to Shareholders | (63,717) | (56,979) | (56,436) |
Other | (181) | (7,039) | 1,214 |
Net cash flow (used for) provided by financing activities | (110,469) | (332,963) | 270,408 |
Effect of exchange rate changes on cash and cash equivalents | (4,835) | (6,355) | (1,494) |
CASH AND CASH EQUIVALENTS | |||
Net increase (decrease) in cash and cash equivalents | 56,085 | (72,435) | (199,387) |
Cash and cash equivalents, beginning of period | 105,494 | 177,929 | 377,316 |
Cash and cash equivalents, end of period | $ 161,579 | $ 105,494 | $ 177,929 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Noncontrolling Interests [Member] |
Beginning Balance, Shares at Jun. 30, 2013 | 77,842 | |||||
Beginning Balance at Jun. 30, 2013 | $ 97,303 | $ 374,300 | $ 1,399,227 | $ (89,004) | $ 30,467 | |
Dividend reinvestment, Shares | 7 | |||||
Dividend reinvestment | $ 9 | 319 | ||||
Capital stock issued under employee benefit and stock plans, Shares | 1,155 | |||||
Capital stock issued under employee benefit and stock plans | $ 1,443 | 35,019 | ||||
Purchase of capital stock, Shares | (332) | |||||
Purchase of capital stock | $ (415) | (13,748) | ||||
Sale of subsidiary stock to noncontrolling interests | 0 | 0 | 0 | |||
Net (loss) income | $ 162,198 | 158,366 | 3,832 | |||
Cash dividends paid to Shareholders | (56,436) | (2,313) | ||||
Unrealized (loss) gain on derivatives designated and qualified as cash flow hedges | (706) | (706) | ||||
Reclassification of unrealized (gain) loss on expired derivatives designated and qualified as cash flow hedges | 1,987 | 1,987 | ||||
Unrecognized net pension and other postretirement benefit loss | (11,990) | (11,990) | ||||
Reclassification of net pension and other postretirement benefit loss | 2,184 | 2,184 | ||||
Foreign currency translation adjustments, net of tax | 31,763 | 31,398 | ||||
Reclassification of foreign currency translation adjustment loss realized upon sale | 0 | 0 | ||||
Other comprehensive (loss) income, net of tax | 23,238 | 22,873 | 366 | |||
Ending Balance, Shares at Jun. 30, 2014 | 78,672 | |||||
Ending Balance at Jun. 30, 2014 | 1,961,608 | $ 98,340 | 395,890 | 1,501,157 | (66,131) | 32,352 |
Dividend reinvestment, Shares | 7 | |||||
Dividend reinvestment | $ 9 | 311 | ||||
Capital stock issued under employee benefit and stock plans, Shares | 703 | |||||
Capital stock issued under employee benefit and stock plans | $ 879 | 23,939 | ||||
Purchase of capital stock, Shares | (7) | |||||
Purchase of capital stock | $ (9) | (311) | ||||
Sale of subsidiary stock to noncontrolling interests | 0 | 0 | 0 | |||
Net (loss) income | (370,961) | (373,896) | 2,935 | |||
Cash dividends paid to Shareholders | (56,979) | (2,314) | ||||
Unrealized (loss) gain on derivatives designated and qualified as cash flow hedges | 6,652 | 6,652 | ||||
Reclassification of unrealized (gain) loss on expired derivatives designated and qualified as cash flow hedges | (2,873) | (2,873) | ||||
Unrecognized net pension and other postretirement benefit loss | (47,982) | (47,982) | ||||
Reclassification of net pension and other postretirement benefit loss | 2,931 | 2,931 | ||||
Foreign currency translation adjustments, net of tax | (139,465) | (136,120) | ||||
Reclassification of foreign currency translation adjustment loss realized upon sale | 0 | 0 | ||||
Other comprehensive (loss) income, net of tax | (180,737) | (177,392) | (3,345) | |||
Ending Balance, Shares at Jun. 30, 2015 | 79,375 | |||||
Ending Balance at Jun. 30, 2015 | 1,375,435 | $ 99,219 | 419,829 | 1,070,282 | (243,523) | 29,628 |
Dividend reinvestment, Shares | 12 | |||||
Dividend reinvestment | $ 15 | 279 | ||||
Capital stock issued under employee benefit and stock plans, Shares | 319 | |||||
Capital stock issued under employee benefit and stock plans | $ 399 | 14,271 | ||||
Purchase of capital stock, Shares | (12) | |||||
Purchase of capital stock | $ (15) | (279) | ||||
Sale of subsidiary stock to noncontrolling interests | 2,517 | 2,517 | 2,566 | |||
Net (loss) income | (223,884) | (225,968) | 2,084 | |||
Cash dividends paid to Shareholders | (63,717) | (1,612) | ||||
Unrealized (loss) gain on derivatives designated and qualified as cash flow hedges | (150) | (150) | ||||
Reclassification of unrealized (gain) loss on expired derivatives designated and qualified as cash flow hedges | (1,563) | (1,563) | ||||
Unrecognized net pension and other postretirement benefit loss | (78,295) | (78,295) | ||||
Reclassification of net pension and other postretirement benefit loss | 4,925 | 4,925 | ||||
Foreign currency translation adjustments, net of tax | (52,695) | (51,508) | ||||
Reclassification of foreign currency translation adjustment loss realized upon sale | 15,088 | 15,088 | ||||
Other comprehensive (loss) income, net of tax | (112,690) | (111,503) | (1,188) | |||
Ending Balance, Shares at Jun. 30, 2016 | 79,694 | |||||
Ending Balance at Jun. 30, 2016 | $ 995,801 | $ 99,618 | $ 436,617 | $ 780,597 | $ (352,509) | $ 31,478 |
Nature of operations
Nature of operations | 12 Months Ended |
Jun. 30, 2016 | |
Nature of operations [Abstract] | |
Nature of Operations [Text Block] | NATURE OF OPERATIONS Kennametal Inc. delivers productivity solutions to customers seeking peak performance in demanding environments. We provide innovative wear-resistant products, application engineering and services backed by advanced material science serving customers across diverse sectors of industrial production, transportation, earthworks, energy, construction, process industries and aerospace. Our solutions are built around industry-essential technology platforms, including precision-engineered metalworking tools and components, surface technologies and earth cutting tools that are mission-critical to customer operations battling extreme conditions associated with wear fatigue, corrosion and high temperatures. The Company's reputation for material and industrial technology excellence, as well as expertise and innovation in development of custom solutions and services, contributes to our leading position in our primary industrial and infrastructure markets. End users of our products include manufacturers, metalworking suppliers, machinery operators and processors engaged in a diverse array of industries, including the manufacture of transportation vehicles and components; machine tool, light machinery and heavy machinery industries; airframe and aerospace components; defense; as well as producers and suppliers in equipment-intensive operations such as coal mining, road construction, quarrying, oil and gas exploration, refining, production and supply. Our product offering includes a wide selection of standard and customized technologies for metalworking, such as sophisticated metal cutting 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. We are a leading global supplier of tooling, engineered components and advanced materials consumed in production processes. We believe we are one of the largest global providers of consumable metal cutting tools and tooling supplies. We specialize in developing and manufacturing metalworking tools and wear-resistant engineered components and coatings using a specialized type of powder metallurgy. Our metalworking tools are made of cemented tungsten carbides, ceramics, cermets and super-hard materials. We also manufacture and market a complete line of tool holders, tool-holding systems and rotary-cutting tools by machining and fabricating steel bars and other metal alloys. In addition, we produce specialized compacts and metallurgical powders, as well as products made from tungsten carbide or other hard materials that are used for custom-engineered and challenging applications, including mining and highway construction, among others. Further, we develop, manufacture and market engineered components and surface technology solutions with proprietary metal cladding capabilities. Unless otherwise specified, any reference to a “year” is to a fiscal year ended June 30. When used in this annual report on Form 10-K, unless the context requires otherwise, the terms “we,” “our” and “us” refer to Kennametal Inc. and its subsidiaries. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The summary of our significant accounting policies is presented below to assist in evaluating our consolidated financial statements. PRINCIPLES OF CONSOLIDATION The consolidated financial statements include our accounts and those of our majority-owned subsidiaries. All significant intercompany balances and transactions are eliminated. Investments in entities of less than 50 percent of the voting stock over which we have significant influence are accounted for on an equity basis. The factors used to determine significant influence include, but are not limited to, our management involvement in the investee, such as hiring and setting compensation for management of the investee, the ability to make operating and capital decisions of the investee, representation on the investee’s board of directors and purchase and supply agreements with the investee. Investments in entities of less than 50 percent of the voting stock in which we do not have significant influence are accounted for on the cost basis. USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS In preparing our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP), we make judgments and estimates about the amounts reflected in our financial statements. As part of our financial reporting process, our management collaborates to determine the necessary information on which to base our judgments and develop estimates used to prepare the financial statements. We use historical experience and available information to make these judgments and estimates. However, different amounts could be reported using different assumptions and in light of different facts and circumstances. Therefore, actual amounts could differ from the estimates reflected in our financial statements. CASH AND CASH EQUIVALENTS Cash investments having original maturities of three months or less are considered cash equivalents. Cash equivalents principally consist of investments in money market funds and bank deposits at June 30, 2016 . ACCOUNTS RECEIVABLE We market our products to a diverse customer base throughout the world. Trade credit is extended based upon periodically updated evaluations of each customer’s ability to satisfy its obligations. We make judgments as to our ability to collect outstanding receivables and provide allowances for the portion of receivables when collection becomes doubtful. Accounts receivable reserves are determined based upon an aging of accounts and a review of specific accounts. INVENTORIES Inventories are stated at the lower of cost or market. We use the last-in, first-out (LIFO) method for determining the cost of a significant portion of our United States (U.S.) inventories. The cost of the remainder of our inventories is determined under the first-in, first-out or average cost methods. When market conditions indicate an excess of carrying costs over market value, a lower-of-cost-or-market provision is recorded. Excess and obsolete inventory reserves are established based upon our evaluation of the quantity of inventory on hand relative to demand. The excess and obsolete inventory reserve at June 30, 2016 and 2015 was $36.7 million and $45.0 million , respectively. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are carried at cost. Major improvements are capitalized, while maintenance and repairs are expensed as incurred. Retirements and disposals are removed from cost and accumulated depreciation accounts, with the gain or loss reflected in operating income. Interest related to the construction of major facilities is capitalized as part of the construction costs and is depreciated over the facilities' estimated useful lives. Depreciation for financial reporting purposes is computed using the straight-line method over the following estimated useful lives: building and improvements over 15 - 40 years; machinery and equipment over 4 - 15 years; furniture and fixtures over 5 - 10 years and computer hardware and software over 3 - 5 years. Leased property and equipment under capital leases are depreciated using the straight-line method over the terms of the related leases. LONG-LIVED ASSETS We evaluate the recoverability of property, plant and equipment and intangible assets that are amortized, whenever events or changes in circumstances indicate the carrying amount of any such assets may not be fully recoverable. Changes in circumstances include technological advances, changes in our business model, capital structure, economic conditions or operating performance. Our evaluation is based upon, among other things, our assumptions about the estimated future undiscounted cash flows these assets are expected to generate. When the sum of the undiscounted cash flows is less than the carrying value of the asset or asset group, we will recognize an impairment loss to the extent that carrying value exceeds fair value. We apply our best judgment when performing these evaluations to determine if a triggering event has occurred, the undiscounted cash flows used to assess recoverability and the fair value of the asset. GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill represents the excess of cost over the fair value of the net assets of acquired companies. Goodwill and other intangible assets with indefinite lives are tested at least annually for impairment. We perform our annual impairment tests during the June quarter in connection with our annual planning process, unless there are impairment indicators based on the results of an ongoing cumulative qualitative assessment that warrant a test prior to that. 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. Identifiable assets with finite lives are reviewed for impairment when events or circumstances indicate that the carrying value may not be recoverable. During the December quarter of fiscal 2016, we performed an interim review of our identifiable assets with finite lives and preliminarily determined that the assets were not impaired. During the March quarter of fiscal 2016, we completed the finalization of fair values related to intangibles and property, plant and equipment. We also completed a review of our identifiable assets with finite lives and determined that the assets were not impaired. Acquisition Impact on Goodwill On November 4, 2013, we acquired TMB from Allegheny Technologies Incorporated (ATI), the operations of which are included in both the Industrial and Infrastructure segments. As a result of the acquisition, we increased goodwill by $246.6 million in based on our purchase price allocations, $3.0 million of which was recorded in the Industrial segment in 2015 based on finalization of the purchase price allocation. The goodwill recorded relates to operating synergies associated with the acquisition that we expected to realize. Goodwill of $202.1 million was deductible for tax purposes. 2015 December Quarter Impairment Charge As previously disclosed, we recorded a non-cash pre-tax impairment charge during the three months ended December 31, 2014 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. 2015 March Quarter Impairment Charge As previously disclosed, we recorded an additional non-cash pre-tax impairment charge during the three months ended March 31, 2015 of $152.9 million in the Infrastructure reporting unit, of which $152.5 million was for goodwill and $0.4 million was for an indefinite-lived trademark intangible asset. In addition, we recorded an additional $6.8 million charge during the three months ended March 31, 2015 for an indefinite-lived trademark intangible asset based upon completion of the 2015 December valuation. During 2015, 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 . 2016 December Quarter Impairment Charge Late in the December quarter of fiscal 2016, the Company experienced a further unexpected deterioration in customer demand in many of its end markets and certain geographies at that time. Industrial production indices in the U.S. and China declined, as well as further reductions in mining and oil and gas activity. In view of these declines and the significant impact on our near term financial forecasts as well as a significant and sustained decline in the Company’s stock price, we determined an interim impairment test of our goodwill and other long-lived assets of our Industrial and Infrastructure reporting units was required. As a result of this interim test, we recorded a preliminary non-cash pre-tax impairment charge during the three months ended December 31, 2015 of $106.1 million in the Infrastructure segment, of which $105.7 million was for goodwill and $0.4 million was for an indefinite-lived trademark intangible asset. We also recorded a preliminary non-cash pre-tax impairment charge during the three months ended December 31, 2015 of $2.3 million in the Industrial segment for an indefinite-lived trademark intangible asset. These impairment charges are recorded in restructuring and asset impairment charges in our consolidated statements of income. There is $298.5 million of goodwill at the Industrial reporting unit. The Industrial reporting unit passed the 2016 interim and annual goodwill impairment tests with fair value substantially exceeded the carrying value. No goodwill remains with the Infrastructure reporting unit as of June 30, 2016 . 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 cannot provide assurance that we will achieve all of the anticipated benefits from restructuring actions we have taken and expect to continue to take. If we are unable to effectively restructure our operations in the light of evolving market conditions, it could have a material adverse effect on our business, financial condition, results of operations and cash flows. We are currently exploring strategic alternatives for a remaining non-core Infrastructure business. The estimated net book value of the business is approximately $30 million as of June 30, 2016 . As the strategic direction has not yet been determined for these businesses, the Company cannot determine if additional impairment charges will be incurred. We recorded no goodwill and other intangible asset impairment charges in 2014 . Divestiture Impact on Goodwill During 2016, we completed the sale of non-core businesses, see Note 4. As a result of this transaction, goodwill decreased by $1.1 million and $6.5 million in our Industrial and Infrastructure segments, respectively. These decreases are recorded in loss on divestiture in our consolidated statements of income. Divestiture Impact on Other Intangible Assets The divestiture of non-core businesses completed during 2016 resulted in a reduction of $30.0 million in customer-related, $15.4 million in unpatented technology, $5.0 million in indefinite-lived trademarks, $1.1 million in definite-lived trademarks, $0.8 million in technology-based and other and $0.5 million in contract-based. PENSION AND OTHER POSTRETIREMENT BENEFITS We sponsor these types of benefit plans for certain employees and retirees. Accounting for the cost of these plans requires the estimation of the cost of the benefits to be provided well into the future and attributing that cost over the expected work life of employees participating in these plans. This estimation requires our judgment about the discount rate used to determine these obligations, expected return on plan assets, rate of future compensation increases, rate of future health care costs, withdrawal and mortality rates and participant retirement age. Differences between our estimates and actual results may significantly affect the cost of our obligations under these plans. In the valuation of our pension and other postretirement benefit liabilities, management utilizes various assumptions. Discount rates are derived by identifying a theoretical settlement portfolio of high quality corporate bonds sufficient to provide for a plan’s projected benefit payments. This rate can fluctuate based on changes in the corporate bond yields. The long-term rate of return on plan assets is estimated based on an evaluation of historical returns for each asset category held by the plans, coupled with the current and short-term mix of the investment portfolio. The historical returns are adjusted for expected future market and economic changes. This return will fluctuate based on actual market returns and other economic factors. The rate of future health care costs is based on historical claims and enrollment information projected over the next year and adjusted for administrative charges. This rate is expected to decrease until 2027. Future compensation rates, withdrawal rates and participant retirement age are determined based on historical information. These assumptions are not expected to significantly change. Mortality rates are determined based on a review of published mortality tables. EARNINGS PER SHARE Basic earnings per share is computed using the weighted average number of shares outstanding during the period, while diluted earnings per share is calculated to reflect the potential dilution that occurs related to the issuance of capital stock under stock option grants, restricted stock awards and restricted stock units. The difference between basic and diluted earnings per share relates solely to the effect of capital stock options, restricted stock awards and restricted stock units. In 2016 and 2015 , 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 at June 30, 2014 , weighted average shares outstanding for basic earnings per share calculations were increased due solely to the dilutive effect of unexercised capital stock options, unvested restricted stock awards and unvested restricted stock units by 1.0 million shares. Unexercised capital stock options, unvested restricted stock awards and restricted stock units of 0.3 million shares at June 30, 2014 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. REVENUE RECOGNITION We recognize revenue for our products and assembled machines when title and all risks of loss and damages pass to the buyer. Our general conditions of sale explicitly state that the delivery of our products and assembled machines is freight on board shipping point and that title and all risks of loss and damage pass to the buyer upon delivery of the sold products or assembled machines to the common carrier. Our general conditions of sale explicitly state that acceptance of the conditions of shipment are considered to have occurred unless written notice of objection is received by Kennametal within 10 calendar days of the date specified on the invoice. We do not ship products or assembled machines unless we have documentation from our customers authorizing shipment. Our products are consumed by our customers in the manufacture of their products. Historically, we have experienced very low levels of returned products and assembled machines and do not consider the effect of returned products and assembled machines to be material. We have recorded an estimated returned goods allowance to provide for any potential returns. We warrant that products and services sold are free from defects in material and workmanship under normal use and service when correctly installed, used and maintained. This warranty terminates 30 days after delivery of the product to the customer and does not apply to products that have been subjected to misuse, abuse, neglect or improper storage, handling or maintenance. Products may be returned to Kennametal, only after inspection and approval by Kennametal and upon receipt by the customer of shipping instructions from Kennametal. We have included an estimated allowance for warranty returns in our returned goods allowance. We recognize revenue related to the sale of specialized assembled machines upon customer acceptance and installation, as installation is deemed essential to the functionality of a specialized assembled machine. Sales of specialized assembled machines were immaterial for 2016 , 2015 and 2014 . STOCK-BASED COMPENSATION We recognize stock-based compensation expense for all stock options, restricted stock awards and restricted stock units over the period from the date of grant to the date when the award is no longer contingent on the employee providing additional service (substantive vesting period). We utilize the Black-Scholes valuation method to establish the fair value of all stock option awards. 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. Capital stock options are granted to eligible employees at fair market value at the date of grant. Capital stock options are exercisable under specified conditions for up to 10 years from the date of grant. The Kennametal Inc. Stock and Incentive Plan of 2010, as Amended and Restated on October 22, 2013, and as further amended January 27, 2015 (A/R 2010 Plan) authorizes the issuance of up to 9,500,000 shares of the Company’s capital stock plus any shares remaining unissued under the Kennametal Inc. Stock and Incentive Plan of 2002, as amended (2002 Plan). Under the provisions of the A/R 2010 Plan participants may deliver stock, owned by the holder for at least six months, in payment of the option price and receive credit for the fair market value of the shares on the date of delivery. The fair market value of shares delivered during 2016 , 2015 and 2014 was immaterial. In addition to stock option grants, the A/R 2010 Plan permits the award of stock appreciation rights, performance share awards, performance unit awards, restricted stock awards, restricted unit awards and share awards to directors, officers and key employees. RESEARCH AND DEVELOPMENT COSTS Research and development costs of $39.4 million , $45.1 million and $44.0 million in 2016 , 2015 and 2014 , respectively, were expensed as incurred. These costs are included in operating expense in the consolidated statements of income. SHIPPING AND HANDLING FEES AND COSTS All fees billed to customers for shipping and handling are classified as a component of sales. All costs associated with shipping and handling are classified as a component of cost of goods sold. INCOME TAXES Deferred income taxes are recognized based on the future income tax effects (using enacted tax laws and rates) of differences in the carrying amounts of assets and liabilities for financial reporting and tax purposes. A valuation allowance is recognized if it is “more likely than not” that some or all of a deferred tax asset will not be realized. 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 use derivative financial instruments to provide predictability to the effects of changes in foreign exchange rates on our consolidated results, achieve our targeted mix of fixed and floating interest rates on outstanding debt. Our objective in managing foreign exchange exposures with derivative instruments is to reduce volatility in cash flow, allowing us to focus more of our attention on business operations. With respect to interest rate management, these derivative instruments allow us to achieve our targeted fixed-to-floating interest rate mix, as a separate decision from funding arrangements, in the bank and public debt markets. We account for derivative instruments as a hedge of the related asset, liability, firm commitment or anticipated transaction, when the derivative is specifically designated as a hedge of such items. 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 (income) expense, net. Certain currency forward contracts hedging significant cross-border intercompany loans are considered other derivatives and, therefore, do not qualify for hedge accounting. These contracts are recorded at fair value in the balance sheet, with the offset to other (income) expense, net. CASH FLOW HEDGES Currency Forward contracts and 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) income, and are recognized as a component of other (income) expense, net when the underlying sale of products or services is recognized into earnings. Interest Rate Floating-to-fixed interest rate swap contracts, designated as cash flow hedges, are entered into from time to time to hedge our exposure to interest rate changes on a portion of our floating rate debt. These interest rate swap contracts convert a portion of our floating rate debt to fixed rate debt. We record the fair value of these contracts as an asset or a liability, as applicable, in the balance sheet, with the offset to accumulated other comprehensive (loss) income. FAIR VALUE HEDGES Interest Rate Fixed-to-floating interest rate swap contracts, designated as fair value hedges, are entered into from time to time to hedge our exposure to fair value fluctuations on a portion of our fixed rate debt. These interest rate swap contracts convert a portion of our fixed rate debt to floating rate debt. When in place, these contracts require periodic settlement, and the difference between amounts to be received and paid under the contracts is recognized in interest expense. CURRENCY TRANSLATION Assets and liabilities of international operations are translated into U.S. dollars using year-end exchange rates, while revenues and expenses are translated at average exchange rates throughout the year. The resulting net translation adjustments are recorded as a component of accumulated other comprehensive (loss) income. The local currency is the functional currency of most of our locations. A gain of $1.6 million , a gain of $1.7 million and a loss of $2.5 million from currency transactions were included in other (income) expense, net in 2016 , 2015 and 2014 , respectively. NEW ACCOUNTING STANDARDS Adopted In April 2014, the Financial Accounting Standards Board (FASB) issued guidance on reporting discontinued operations and disclosures of disposals of components of an entity. Under the guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. Additionally, the guidance requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income and expenses of discontinued operations. The guidance also requires disclosure of the pre-tax income attributable to a disposal of a significant part of an organization that does not qualify for discontinued operations reporting. This guidance was effective for Kennametal beginning July 1, 2015. The divestiture of non-core businesses outlined in Note 4 was evaluated under this guidance. Issued In June 2016, the FASB issued guidance on measurement of credit losses on financial instruments. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. The scope of this amendment includes valuation of trade receivables. This standard is effective for Kennametal beginning July 1, 2020. We are in the process of assessing the impact the adoption of this guidance will have on our consolidated financial statements. In May 2016, the FASB issued guidance on narrow scope improvements and practical expedients as part of Topic 606: Revenue from Contracts with Customers. The amendments address collectability criterion and accounting for contracts that do not meet the criteria, presentation of sales taxes and other similar taxes collected from customers, noncash consideration, contract modifications at transition and completed contracts at transition, in addition to a technical correction. This standard is effective for Kennametal beginning July 1, 2018, in conjunction with the adoption of Accounting Standards Update 2014-09, “Revenue from Contracts with Customers: Topic 606.” We are in the process of assessing the impact the adoption of this guidance will have on our consolidated financial statements. In April 2016, the FASB issued guidance on identifying performance obligations and licensing as part of Topic 606: Revenue from Contracts with Customers. The amendments in this update clarify identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. This standard is effective for Kennametal beginning July 1, 2018, in conjunction with the adoption of Accounting Standards Update 2014-09, “Revenue from Contracts with Customers: Topic 606.” We are in the process of assessing the impact the adoption of this guidance will have on our consolidated financial statements. In March 2016, the FASB issued guidance intended to simplify equity-based award accounting and presentation. The guidance impacts income tax accounting related to equity-based awards, the classification of awards as either equity or liabilities, and the classification on the statement of cash flows. This standard is effective for Kennametal beginning July 1, 2017. We are in the process of assessing the impact the adoption of this guidance will have on our consolidated financial statements. In March 2016, the FASB issued guidance on principal versus agent considerations in reporting revenue gross versus net. This guidance is intended to improve the operability and understandability of the implementation guidance on principal versus agent considerations. As this update serves to clarify existing guidance, it is not expected to have a material impact on our consolidated financial statements. In February 2016, the FASB issued guidance on lease accounting, which replaces the existing guidance in ASC 840, Leases. The standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. This standard is effective for Kennametal beginning July 1, 2019. We are in the process of assessing the impact the adoption of this guidance will have on our consolidated financial statements. In November 2015, the FASB issued guidance on balance sheet classification of deferred taxes. The amendments in this Update require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position, as opposed to the current practice of separating deferred income tax liabilities and assets into current and noncurrent amounts on the balance sheet. This standard is effective for Kennametal beginning July 1, 2017. We are in the process of assessing the impact the adoption of this ASU will have on our consolidated financial statements. In August 2015, the FASB issued guidance that defers the effective date of previously issued ASU 2014-09, “Revenue from Contracts with Customers: Topic 606.” Under this guidance, the effective date for Kennametal was deferred from July 1, 2017 to July 1, 2018. We are in the process of assessing the impact the adoption of this ASU will have on our consolidated financial statements. In July 2015, the FASB issued guidance on subsequent measurement of inventory. The amendments in this update require that inventory other than LIFO be subsequently measured at the lower of cost and net realizable value, as opposed to the current practice of lower of cost or market. Subsequent measurement is unchanged for inventory measured using LIFO. This standard is effective for Kennametal beginning July 1, 2017. We are in the process of evaluating the impact of adoption on our consolidated financial statements. In April 2015, the FASB issued guidance on the presentation of debt issuance costs. The guidance requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct reduction from the carrying amount of that debt liability, consistent with debt discounts. This standard is effective for Kennametal beginning July 1, 2016 and will be retrospectively applied. The guidance did not have a material impact on our consolidated financial position, results of operations and cash flows. In April 2015, the FASB issued guidance on accounting for fees paid in a cloud computing arrangement. The amendments in this update provide guidance to customers about whether a cloud computing arrangement includes a software license and accounting for the arrangement as capitalized and amortized as an intangible asset or expensed as incurred as a service contract. This standard is effective for Kennametal beginning July 1, 2016. The provisions of the guidance may be applied prospectively or retrospectively. We plan to adopt this guidance prospectively, and adoption of this ASU is not expected to have a material impact on our consolidated financial position, results of operations and cash flows. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers: Topic 606.” This ASU replaces nearly all existing U.S. GAAP guidance on revenue recognition. The standard prescribes a five-step model for recognizing revenue, the application of which will require significant judgment. This standard is effective for Kennametal July 1, 2017. We are in the process of assessing the impact the adoption of this ASU will have on our consolidated financial statements. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Jun. 30, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
SUPPLEMENTAL CASH FLOW DISCLOSURES | SUPPLEMENTAL CASH FLOW DISCLOSURES Year ended June 30 (in thousands) 2016 2015 2014 Cash paid during the period for: Interest $ 26,250 $ 30,984 $ 29,836 Income taxes 43,733 40,295 49,393 Supplemental disclosure of non-cash information: Changes in accounts payable related to purchases of property, plant and equipment 1,000 (9,900 ) 2,100 |
Acquisitions and Divestitures
Acquisitions and Divestitures | 12 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
ACQUISITIONS AND DIVESTITURES | ACQUISITIONS AND DIVESTITURES Divestiture of Non-Core Businesses In 2016, Kennametal completed the transaction to sell all of the outstanding capital stock of: Kennametal Extrude Hone LLC and its wholly owned subsidiaries, Kennametal Stellite S.r.l. (Bellusco, Italy), Kennametal Stellite S.p.A. (Milan, Italy), Kennametal Stellite GmbH (Koblenz, Germany); and all of the assets of the businesses of: Tricon (manufacturing operations in Birmingham, Alabama; Chicago, Illinois; and Elko, Nevada), Landis (manufacturing operation in Waynesboro, Pennsylvania); and all of the assets located at the Biel, Switzerland manufacturing facility ("non-core businesses") to Madison Industries for an aggregate price of $56.1 million cash, net of cash. A portion of the transaction proceeds were used to pay down revolver debt and the remaining balance is being held as cash on hand. The net book value of these non-core businesses was $191.9 million . The pre-tax net loss on divestiture recognized in 2016 was $131.5 million , of which $127.9 million and $3.6 million were recorded in the Infrastructure and Industrial segments, respectively. The pre-tax income attributable to the non-core businesses was assessed and determined to be immaterial for disclosure for the periods presented. TMB Acquisition On November 4, 2013, the Company completed its transaction to acquire TMB from 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 preliminary 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. TMB is a leading producer of tungsten metallurgical powders, as well as tooling technologies and components. When acquired, the business had approximately 1,175 employees in 12 locations primarily in the United States of America, and 6 other countries. As part of the acquisition of TMB, Kennametal incurred $8.7 million for the year ended June 30, 2014 of acquisition-related costs, which are included in operating expense and cost of goods sold. The accompanying consolidated balance sheet as of June 30, 2015 reflects the final allocation of the purchase price. We recorded an additional $3.0 million of goodwill in 2015 based on finalization of the purchase price. See Note 2. The operating results for the year ended June 30, 2014 include net sales of $194.9 million and net loss attributable to Kennametal of $10.5 million related to TMB. 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 for the year ended June 30, 2014 excludes $8.7 million of acquisition-related and includes $19.1 million of restructuring-related pre-tax costs. 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: Year ended June 30 (in thousands) 2014 Pro forma (unaudited): Net Sales $ 2,941,005 Net income attributable to Kennametal $ 175,804 Per share data attributable to Kennametal Shareholders : Basic earnings per share $ 2.23 Diluted earnings per share $ 2.21 During the year ended June 30, 2014 , we divested a small non-core business acquired as part of the TMB acquisition for proceeds of $10.2 million . Emura On August 1, 2013, the Company acquired the operating assets of Emura, based in La Paz, Bolivia, and secured related material sourcing agreements for a purchase price of $40.1 million , of which $25.6 million was paid in fiscal year 2014 and $0.5 million was paid in fiscal year 2013, and $14.0 million of contingent consideration, as discussed in Note 5. Emura's principal operations are engaged in collecting, testing, processing and exporting tungsten ore material, and was a long-standing supplier to Kennametal. The addition of Emura enhances the Company's strategic tungsten sourcing capabilities to serve growth globally. Other On September 30, 2013, the Company completed a small acquisition in the Infrastructure segment for $2.0 million . |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jun. 30, 2016 | |
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 June 30, 2016 , 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) $ — $ 334 $ — $ 334 Total assets at fair value $ — $ 334 $ — $ 334 Liabilities: Derivatives (1) $ — $ 763 $ — $ 763 Contingent consideration — — 6,600 6,600 Total liabilities at fair value $ — $ 763 $ 6,600 $ 7,363 There have been no changes in classification and transfers between levels in the fair value hierarchy in the current period. 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 a previous acquisition. The contingent consideration is expected to be paid over the next six months and is recorded in other current liabilities in our consolidated balance sheet. The Company reassessed this contingent consideration and determined that an adjustment of $3.4 million to reduce the fair value of the remaining contingent consideration was necessary during 2016 due to agreed upon terms with the seller that they did not achieve certain milestone targets and to a return of inventory to the seller during the period. No other changes in the expected outcome have occurred during 2016. As of June 30, 2015 , 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) $ — $ 2,678 $ — $ 2,678 Total assets at fair value $ — $ 2,678 $ — $ 2,678 Liabilities: Derivatives (1) $ — $ 44 $ — $ 44 Contingent consideration — — 10,000 10,000 Total liabilities at fair value $ — $ 44 $ 10,000 $ 10,044 (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 Hedg
Derivative Instruments and Hedging Activities | 12 Months Ended |
Jun. 30, 2016 | |
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. See Note 2 for discussion on our derivative instruments and hedging activities policy. The fair value of derivatives designated and not designated as hedging instruments in the consolidated balance sheet are as follows: (in thousands) 2016 2015 Derivatives designated as hedging instruments Other current assets - range forward contracts $ 323 $ 2,626 Total derivatives designated as hedging instruments 323 2,626 Derivatives not designated as hedging instruments Other current assets - currency forward contracts 11 52 Other current liabilities - currency forward contracts (763 ) (44 ) Total derivatives not designated as hedging instruments (752 ) 8 Total derivatives $ (429 ) $ 2,634 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 consolidated balance sheet, with the offset to other (income) expense, net. Losses (gains) related to derivatives not designated as hedging instruments have been recognized as follows: (in thousands) 2016 2015 2014 Other (income) expense, net - currency forward contracts $ 719 $ (1,026 ) $ 1,057 FAIR VALUE HEDGES Fixed-to-floating interest rate swap contracts, designated as fair value hedges, are entered into from time to time to hedge our exposure to fair value fluctuations on a portion of our fixed rate debt. We had no such contracts outstanding at June 30, 2016 and June 30, 2015. CASH FLOW HEDGES Currency forward contracts and 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) income, and are recognized as a component of other (income) expense, 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 June 30, 2016 and 2015 was $53.3 million and $53.8 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 June 30, 2016 , we expect to recognize into earnings in the next 12 months an immaterial amount of losses on outstanding derivatives. Floating-to-fixed interest rate swap contracts, designated as cash flow hedges, are entered into from time to time to hedge our exposure to interest rate changes on a portion of our floating rate debt. These interest rate swap contracts convert a portion of our floating rate debt to fixed rate debt. We record the fair value of these contracts as an asset or a liability, as applicable, in the balance sheet, with the offset to accumulated other comprehensive (loss) income, net of tax. We had no such contracts outstanding at June 30, 2016 or 2015 , respectively. The following represents gains and losses related to cash flow hedges: (in thousands) 2016 2015 2014 Gains (losses) recognized in other comprehensive loss (income), net $ (297 ) $ 6,651 $ (702 ) Losses (gains) reclassified from accumulated other comprehensive loss into other (income) expense, net $ 381 $ (250 ) $ 1,399 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 years ended June 30, 2016 , 2015 and 2014 . |
Inventories
Inventories | 12 Months Ended |
Jun. 30, 2016 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories consisted of the following at June 30: (in thousands) 2016 2015 Finished goods $ 284,054 $ 324,840 Work in process and powder blends 166,274 249,629 Raw materials 68,472 100,881 Inventories at current cost 518,800 675,350 Less: LIFO valuation (59,970 ) (99,819 ) Total inventories $ 458,830 $ 575,531 We used the LIFO method of valuing inventories for approximately 44 percent and 47 percent of total inventories at June 30, 2016 and 2015 , respectively. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets | 12 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS 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 year ended June 30, 2015: Acquisition 2,984 — 2,984 Translation (19,950 ) (13,721 ) (33,671 ) Change in gross goodwill (16,966 ) (13,721 ) (30,687 ) Gross goodwill 455,371 640,360 1,095,731 Accumulated impairment losses (150,842 ) (527,500 ) (678,342 ) Balance as of June 30, 2015 $ 304,529 $ 112,860 $ 417,389 Activity for the year ended June 30, 2016: Divestiture (1,075 ) (6,461 ) (7,536 ) Translation (4,967 ) (688 ) (5,655 ) Change in gross goodwill (6,042 ) (7,149 ) (13,191 ) Impairment charges — (105,711 ) (105,711 ) Gross goodwill 449,329 633,211 1,082,540 Accumulated impairment losses (150,842 ) (633,211 ) (784,053 ) Balance as of June 30, 2016 $ 298,487 $ — $ 298,487 The components of our other intangible assets were as follows: Estimated Useful Life (in years) June 30, 2016 June 30, 2015 (in thousands) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Contract-based 3 to 15 $ 7,152 $ (6,886 ) $ 8,523 $ (6,990 ) Technology-based and other 4 to 20 47,323 (27,011 ) 52,820 (29,723 ) Customer-related 10 to 21 205,471 (66,938 ) 275,796 (90,141 ) Unpatented technology 10 to 30 31,837 (4,614 ) 59,449 (14,426 ) Trademarks 5 to 20 12,668 (8,644 ) 18,575 (12,090 ) Trademarks Indefinite 16,850 — 24,876 — Total $ 321,301 $ (114,093 ) $ 440,039 $ (153,370 ) Amortization expense for intangible assets was $20.8 million , $26.7 million and $26.2 million for 2016 , 2015 and 2014 , respectively. Estimated amortization expense for 2017 through 2021 is $15.8 million , $14.3 million , $13.9 million , $13.7 million , and $13.3 million , respectively. |
Other Current Liabilities
Other Current Liabilities | 12 Months Ended |
Jun. 30, 2016 | |
Other Liabilities, Current [Abstract] | |
Other Current Liabilities [Text Block] | OTHER CURRENT LIABILITIES Other current liabilities consisted of the following at June 30: (in thousands) 2016 2015 Accrued employee benefits $ 33,754 $ 40,995 Accrued restructuring (Note 15) 15,703 20,788 Payroll, state and local taxes 12,983 15,006 Accrued legal and professional fees 12,112 11,710 Accrued interest 7,079 7,040 Other 70,638 83,139 Total other current liabilities $ 152,269 $ 178,678 |
Long-Term Debt and Capital Leas
Long-Term Debt and Capital Leases | 12 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT AND CAPITAL LEASES | LONG-TERM DEBT AND CAPITAL LEASES Long-term debt and capital lease obligations consisted of the following at June 30: (in thousands) 2016 2015 2.65% Senior Unsecured Notes due 2019 net of discount of $0.3 million for 2016 and $0.3 million for 2015 $ 399,748 $ 399,671 3.875% Senior Unsecured Notes due 2022 net of discount of $0.2 million for 2016 and $0.2 million for 2015 299,794 299,757 Credit Agreement: Euro-denominated borrowings, 0.9% to 1.1% in 2016 and 2015, due 2021 — 42,609 U.S. Dollar-denominated borrowings, 1.2% in 2016 and 2015, due 2021 — 200 Capital leases with terms expiring through 2018 at 1.6% to 5.4% in 2016 and 2015 748 1,771 Other — 6 Total debt and capital leases 700,290 744,014 Less current maturities: Long-term debt — (8,049 ) Capital leases (732 ) (74 ) Other — (6 ) Total current maturities (732 ) (8,129 ) Long-term debt and capital leases, less current maturities $ 699,558 $ 735,885 Senior Unsecured Notes On November 7, 2012, we issued $400.0 million of 2.65 percent Senior Unsecured Notes due in 2019. Interest is paid semi-annually on May 1 and November 1 of each year. We used the net proceeds from this notes offering to repay outstanding indebtedness under our credit facility and for general corporate purposes. On February 14, 2012, we issued $300 million of 3.875 percent Senior Unsecured Notes due in 2022. Interest is paid semi-annually on February 15 and August 15 of each year. Credit Agreement The five -year, multi-currency, revolving credit facility, as amended and restated in April 2016 (Credit Agreement) permits revolving credit loans of up to $600 million for working capital, capital expenditures and general corporate purposes. The Credit Agreement matures in April 2021 and allows for borrowings in U.S. dollars, euro, Canadian dollars, pound sterling and Japanese yen. Interest payable under the Credit Agreement is based upon the type of borrowing under the facility and may be (1) LIBOR plus an applicable margin, (2) the greater of the prime rate or the Federal Funds effective rate plus an applicable margin, or (3) fixed as negotiated by us. The 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 June 30, 2016 . We had $0.0 million and $42.8 million of borrowings outstanding under the Credit Agreement as of June 30, 2016 and June 30, 2015 , respectively. Borrowings under the Credit Agreement are guaranteed by our significant domestic subsidiaries. Future principal maturities of long-term debt are $400 million in 2020 and $300 million beyond 2021. Future minimum lease payments under capital leases for the next five years and thereafter in total are as follows: (in thousands) 2017 $ 775 2018 25 2019 — 2020 — 2021 — After 2021 — Total future minimum lease payments 800 Less amount representing interest (52 ) Amount recognized as capital lease obligations $ 748 At June 30, 2016 and 2015 our collateralized debt consisted of capitalized lease obligations of $0.7 million and $1.8 million , respectively. The underlying assets collateralize these obligations. |
Notes Payable and Lines of Cred
Notes Payable and Lines of Credit | 12 Months Ended |
Jun. 30, 2016 | |
Notes Payable and Lines of Credit [Abstract] | |
Notes Payable and Lines of Credit | NOTES PAYABLE AND LINES OF CREDIT Notes payable to banks of $1.2 million and $7.6 million at June 30, 2016 and 2015 , respectively, represents short-term borrowings under credit lines with commercial banks. These credit lines, translated into U.S. dollars at June 30, 2016 exchange rates, totaled $152.4 million at June 30, 2016 , of which $151.2 million was unused. The weighted average interest rate for notes payable and lines of credit was 9.0 percent and 2.0 percent at June 30, 2016 and 2015 , respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES (Loss) income before income taxes consisted of the following for the years ended June 30: (in thousands) 2016 2015 2014 (Loss) income before income taxes: United States $ (228,667 ) $ (323,299 ) $ 59,160 International 30,096 (64,316 ) 169,649 Total (loss) income before income taxes $ (198,571 ) $ (387,615 ) $ 228,809 Current income taxes: Federal $ (15,039 ) $ (9,328 ) $ 15,108 State 454 816 896 International 31,570 40,433 27,488 Total current income taxes 16,985 31,921 43,492 Deferred income taxes: Federal $ 6,786 $ (38,943 ) $ 10,157 State 8,407 (8,680 ) (62 ) International (6,865 ) (952 ) 13,024 Total deferred income taxes: 8,328 (48,575 ) 23,119 Provision (benefit) for income taxes $ 25,313 $ (16,654 ) $ 66,611 Effective tax rate (12.7 )% 4.3 % 29.1 % The reconciliation of income taxes computed using the statutory U.S. income tax rate and the provision for income taxes was as follows for the years ended June 30: (in thousands) 2016 2015 2014 Income taxes at U.S. statutory rate $ (69,500 ) $ (135,665 ) $ 80,083 State income taxes, net of federal tax benefits 859 (1,748 ) 1,593 U.S. income taxes provided on international income 2,364 3,679 2,423 Combined tax effects of international income (25,469 ) (21,560 ) (22,580 ) Impact of goodwill impairment charges 6,439 134,657 — Impact of divestiture 27,790 — — Change in valuation allowance and other uncertain tax positions 84,530 1,530 (2,603 ) Impact of domestic production activities deduction (2,072 ) — (942 ) Research and development credit (4,351 ) (3,087 ) (1,385 ) Change in permanent reinvestment assertion 3,659 2,945 7,170 Other 1,064 2,595 2,852 Provision (benefit) for income taxes $ 25,313 $ (16,654 ) $ 66,611 During 2016, we recorded a valuation allowance against our net domestic deferred tax assets of $105.9 million , as discussed below. Of this amount, $81.2 million impacted the effective tax rate and is included in the income tax reconciliation table under the caption "change in valuation allowance and other uncertain tax positions," and $24.7 million was recorded in other comprehensive income. During 2016 and 2015, we recorded goodwill impairment charges related to our Infrastructure segment. There was no tax benefit for a portion of charges in 2016. There was no tax benefit for a majority of charges in 2015. The federal effect of these permanent differences is included in the income tax reconciliation table under the caption "impact of goodwill impairment charges." During 2016, we divested certain non-core businesses as described in Note 4. A portion of the loss from this divestiture was not deductible for tax purposed. The Federal effect of this permanent difference is included in the income tax reconciliation table under the caption "impact of divestiture." During 2016 we recorded on adjustment of $3.7 million related to a change in assertion of certain foreign subsidiaries' undistributed earnings primarily related to the transaction described in Note 4, which are no longer considered permanently reinvested. The effect of this charge is included in the income tax reconciliation table under the caption "change in permanent reinvestment assertion." During 2015, we recorded an adjustment of $2.9 million related to a change in assertion of certain foreign subsidiaries' undistributed earnings, which are no longer considered permanently reinvested. The effect of this charge is included in the income tax reconciliation table under the caption "change in permanent reinvestment assertion." During 2014, we recorded an adjustment of $2.2 million related to the effective settlement of uncertain tax positions in Europe, which reduced income tax expense. The effects of these tax benefits are included in the income tax reconciliation table under the caption “change in valuation allowance and other uncertain tax positions.” During 2014, we recorded a valuation allowance adjustment of $1.2 million , which reduced income tax expense. The valuation allowance adjustment is related to a state tax law change. The effect of this tax benefit is included in the income tax reconciliation table under the caption “change in valuation allowance and other uncertain tax positions.” During 2014, we recorded an adjustment of $7.2 million related to a change in assertion of a foreign subsidiary’s certain undistributed earnings, which are no longer considered permanently reinvested. The effect of this charge is included in the income tax reconciliation table under the caption “change in permanent reinvestment assertion.” The components of net deferred tax assets and (liabilities) were as follows at June 30: (in thousands) 2016 2015 Deferred tax assets: Net operating loss carryforwards $ 77,198 $ 47,289 Inventory valuation and reserves 18,865 18,023 Pension benefits 42,432 23,559 Other postretirement benefits 7,111 7,359 Accrued employee benefits 17,069 23,674 Other accrued liabilities 9,229 18,210 Hedging activities 5,507 4,354 Tax credits and other carryforwards 30,733 13,815 Intangible assets 21,575 — Other — 12,028 Total 229,719 168,311 Valuation allowance (122,699 ) (16,771 ) Total deferred tax assets $ 107,020 $ 151,540 Deferred tax liabilities: Tax depreciation in excess of book $ 83,412 $ 102,480 Intangible assets — 18,688 Other 149 — Total deferred tax liabilities $ 83,561 $ 121,168 Total net deferred tax assets (liabilities) $ 23,459 $ 30,372 Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not (greater than 50%) that a tax benefit will not be realized. In evaluating the need for a valuation allowance, we consider all potential sources of taxable income, including income available in carryback periods, future reversals of taxable temporary differences, projections of taxable income, and income from tax planning strategies, as well as all available positive and negative evidence. Positive evidence includes factors such as a history of profitable operations, and projections of future profitability within the carry forward period, including taxable income from tax planning strategies. Negative evidence includes items such as cumulative losses, projections of future losses, or carryforward periods that are not long enough to allow for the utilization of the deferred tax asset based on existing projections of income. Upon changes in facts and circumstances, we may conclude that deferred tax assets for which no valuation allowance is currently recorded may not be realized, resulting in a future charge to establish a valuation allowance. Existing valuation allowances are re-examined under the same standards of positive and negative evidence. If it is determined that it is more likely than not that a deferred tax asset will be realized, the appropriate amount of the valuation allowance, if any, is released. In 2016, we recorded a valuation allowance of $105.9 million against our net deferred tax assets in the U.S. Of this amount, $81.2 million was recorded in the provision for income taxes and $24.7 million was recorded in other comprehensive income. After weighing all available positive and negative evidence, as previously described, we determined that it was no longer more likely than not that we will realize the tax benefit of these deferred tax assets. This was driven by cumulative pre-tax domestic losses from charges related to asset impairment, restructuring and loss on divestiture, as well as an overall decrease in demand in U.S. operations. The need for this valuation allowance will be assessed on a continuous basis in future periods and, as a result, a portion or all of the valuation allowance may be reversed based on changes in facts and circumstances. Included in deferred tax assets at June 30, 2016 is $30.7 million associated with tax credits and other carryforward items primarily in federal and state jurisdictions. Of that amount, $1.1 million expires through 2021, $22.9 million expires through 2026, $0.6 million expires through 2031, $5.9 million expires through 2036 and the remaining $0.2 million does not expire. Included in deferred tax assets at June 30, 2016 is $77.2 million associated with net operating loss carryforwards in state and foreign jurisdictions. Of that amount, $7.2 million expires through 2021, $3.6 million expires through 2026, $2.1 million expires through 2031, $39.7 million expires through 2036, and the remaining $24.6 million does not expire. The realization of these tax benefits is primarily dependent on future taxable income in these jurisdictions. A valuation allowance of $122.7 million has been placed against deferred tax assets in the U.S., Europe, China, Hong Kong and Brazil, all of which would be allocated to income tax expense upon realization of the deferred tax assets. In 2016, the valuation allowance related to these deferred tax assets increased by $105.9 million . As the respective operations generate sufficient income, the valuation allowances will be partially or fully reversed at such time we believe it will be more likely than not that the deferred tax assets will be realized. As of June 30, 2016 , unremitted earnings of our non-U.S. subsidiaries and affiliates of $2,019.4 million , the majority of which have not been previously taxed in the U.S., are considered permanently reinvested, and accordingly, no deferred tax liability has been recorded in connection therewith. It is not practical to estimate the income tax effect that might be incurred if cumulative prior year earnings not previously taxed in the U.S. were remitted to the U.S. A reconciliation of the beginning and ending amount of unrecognized tax benefits (excluding interest) is as follows as of June 30: (in thousands) 2016 2015 2014 Balance at beginning of year $ 14,619 $ 20,366 $ 26,798 Increases for tax positions of prior years 1,197 — 1,461 Decreases for tax positions of prior years — (3,188 ) (6,982 ) Increases for tax positions related to the current year — — 116 Decreases related to settlement with taxing authority (11,942 ) (348 ) (2,161 ) Decreases related to lapse of statute of limitations (667 ) (398 ) — Foreign currency translation (101 ) (1,813 ) 1,134 Balance at end of year $ 3,106 $ 14,619 $ 20,366 The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate in 2016 , 2015 and 2014 is $3.1 million , $2.7 million and $2.4 million , respectively. Our policy is to recognize interest and penalties related to income taxes as a component of the provision for income taxes in the consolidated statement of income. We recognized a reduction in interest of $0.2 million and $0.7 million in 2016 and 2015, respectively. We recognized interest expense of $0.8 million in 2014. As of June 30, 2016 and 2015 the amount of interest accrued was $0.3 million and $0.5 million , respectively. As of June 30, 2016 and 2015 , the amount of penalty accrued was $0.3 million and $0.2 million , respectively. In 2016, decreases for tax positions related to the current year primarily relate to one foreign tax position. We settled this position with the foreign authority. A corresponding deferred tax asset in the amount of $11.9 million was released for the position in the U.S. and in the prior year this amount was included in the components of net deferred tax liabilities and assets table under the caption "other." With few exceptions, we are no longer subject to income tax examinations by tax authorities for years prior to 2010. The Internal Revenue Service has audited all U.S. tax years prior to 2013 and is currently examining 2014. Various state and foreign jurisdiction tax authorities are in the process of examining our income tax returns for various tax years ranging from 2010 to 2014. We continue to execute our pan-European business model. As a result of this and other matters, we continuously review our uncertain tax positions and evaluate any potential issues that may lead to an increase or decrease in the total amount of unrecognized tax benefits recorded. We believe that it is reasonably possible that the amount of unrecognized tax benefits could decrease by approximately $0.6 million within the next twelve months. |
Pension and Other Postretiremen
Pension and Other Postretirement Benefits | 12 Months Ended |
Jun. 30, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Pension and Other Postretirement Benefits Disclosure | PENSION AND OTHER POSTRETIREMENT BENEFITS Pension benefits under defined benefit pension plans are based on years of service and, for certain plans, on average compensation for specified years preceding retirement. We fund pension costs in accordance with the funding requirements of the Employee Retirement Income Security Act of 1974 (ERISA), as amended, for U.S. plans and in accordance with local regulations or customs for non-U.S. plans. We have an Executive Retirement Plan for various executives and a Supplemental Executive Retirement Plan which was closed to future participation on July 26, 2006. We presently provide varying levels of postretirement health care and life insurance benefits to certain employees and retirees. Postretirement health care benefits are available to employees and their spouses retiring on or after age 55 with 10 or more years of service. Beginning with retirements on or after January 1, 1998, our portion of the costs of postretirement health care benefits is capped at 1996 levels. Beginning with retirements on or after January 1, 2009, we have no obligation to provide a company subsidy for retiree medical costs. We use a June 30 measurement date for all of our plans. Defined Benefit Pension Plans The funded status of our pension plans and amounts recognized in the consolidated balance sheets as of June 30 were as follows: (in thousands) 2016 2015 Change in benefit obligation: Benefit obligation, beginning of year $ 954,454 $ 969,904 Service cost 4,640 5,474 Interest cost 37,726 39,007 Participant contributions 6 12 Actuarial losses 86,425 50,464 Benefits and expenses paid (45,074 ) (73,897 ) Currency translation adjustments (19,283 ) (36,377 ) Plan amendments 696 — Special termination benefits 334 459 Plan settlements (7,991 ) — Plan curtailments (6,565 ) (592 ) Benefit obligation, end of year $ 1,005,368 $ 954,454 Change in plans' assets: Fair value of plans' assets, beginning of year $ 827,337 $ 884,264 Actual return on plans' assets 50,637 20,007 Company contributions 15,876 8,703 Participant contributions 6 12 Plan settlements (7,991 ) — Benefits and expenses paid (45,074 ) (73,897 ) Currency translation adjustments (19,116 ) (11,752 ) Fair value of plans' assets, end of year $ 821,675 $ 827,337 Funded status of plans $ (183,693 ) $ (127,117 ) Amounts recognized in the balance sheet consist of: Long-term prepaid benefit $ 8,941 $ 31,274 Short-term accrued benefit obligation (10,037 ) (14,592 ) Accrued pension benefits (182,597 ) (143,799 ) Net amount recognized $ (183,693 ) $ (127,117 ) The pre-tax amounts related to our defined benefit pension plans recognized in accumulated other comprehensive (loss) income were as follows at June 30: (in thousands) 2016 2015 Unrecognized net actuarial losses $ 272,802 $ 196,567 Unrecognized net prior service credits 155 (953 ) Unrecognized transition obligations 740 651 Total $ 273,697 $ 196,265 Prepaid pension benefits are included in other long-term assets. The assets of our U.S. and international defined benefit pension plans consist principally of capital stocks, corporate bonds and government securities. To the best of our knowledge and belief, the asset portfolios of our defined benefit pension plans do not contain our capital stock. We do not issue insurance contracts to cover future annual benefits of defined benefit pension plan participants. Transactions between us and our defined benefit pension plans include the reimbursement of plan expenditures incurred by us on behalf of the plans. To the best of our knowledge and belief, the reimbursement of cost is permissible under current ERISA rules or local government law. The accumulated benefit obligation for all defined benefit pension plans was $1,003.5 million and $943.5 million as of June 30, 2016 and 2015 , respectively. Included in the above information are plans with accumulated benefit obligations exceeding the fair value of plan assets as of June 30 as follows: (in thousands) 2016 2015 Projected benefit obligation $ 877,146 $ 165,281 Accumulated benefit obligation 875,233 164,913 Fair value of plan assets 684,512 7,394 The components of net periodic pension income include the following as of June 30: (in thousands) 2016 2015 2014 Service cost $ 4,640 $ 5,474 $ 6,910 Interest cost 37,726 39,007 41,084 Expected return on plans' assets (58,523 ) (59,698 ) (59,527 ) Amortization of transition obligation 80 78 78 Amortization of prior service cost (417 ) (361 ) (234 ) Special termination benefit charge 334 459 — Curtailment loss — 358 — Settlement loss 227 261 — Recognition of actuarial losses 7,286 3,671 2,642 Net periodic pension income $ (8,647 ) $ (10,751 ) $ (9,047 ) During 2016, we recognized a special termination benefit charge of $0.3 million and a settlement loss of $0.2 million related to several terminated Executive Retirement Plan participants. Both of these items were recognized in restructuring expense. During 2015, 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. As of June 30, 2016 , the projected benefit payments, including future service accruals for these plans for 2017 through 2021, are $52.2 million , $48.2 million , $50.1 million , $51.8 million and $53.5 million , respectively, and $283.3 million in 2022 through 2026. The amounts of accumulated other comprehensive loss expected to be recognized in net periodic pension cost during 2016 related to net actuarial losses and transition obligations are $8.5 million and $0.1 million , respectively. The amount of accumulated other comprehensive income expected to be recognized in net periodic pension cost during 2016 related to prior service credit is $0.5 million . We expect to contribute approximately $12.1 million to our pension plans in 2017. Other Postretirement Benefit Plans The funded status of our other postretirement benefit plans and the related amounts recognized in the consolidated balance sheets were as follows: (in thousands) 2016 2015 Change in benefit obligation: Benefit obligation, beginning of year $ 21,205 $ 24,476 Service cost — 45 Interest cost 840 934 Actuarial losses 722 1,489 Benefits paid (2,225 ) (2,155 ) Curtailments — (3,584 ) Benefit obligation, end of year $ 20,542 $ 21,205 Funded status of plan $ (20,542 ) $ (21,205 ) Amounts recognized in the balance sheet consist of: Short-term accrued benefit obligation $ (1,666 ) $ (1,975 ) Accrued postretirement benefits (18,876 ) (19,230 ) Net amount recognized $ (20,542 ) $ (21,205 ) The pre-tax amounts related to our other postretirement benefit plans which were recognized in accumulated other comprehensive (loss) income were as follows at June 30: (in thousands) 2016 2015 Unrecognized net actuarial losses $ 6,368 $ 5,969 Unrecognized net prior service credits (150 ) (172 ) Total $ 6,218 $ 5,797 The components of net periodic other postretirement benefit cost include the following for the years ended June 30: (in thousands) 2016 2015 2014 Service cost $ — $ 45 $ 55 Interest cost 840 934 1,006 Amortization of prior service credit (22 ) (59 ) (111 ) Recognition of actuarial loss 324 492 317 Curtailment gain — (221 ) — Net periodic other postretirement benefit cost $ 1,142 $ 1,191 $ 1,267 The curtailment gain of $0.2 million during 2015 was a result of the plant closure discussed above. As of June 30, 2016, the projected benefit payments, including future service accruals for our other postretirement benefit plans for 2017 through 2021, are $2.0 million , $1.9 million , $1.8 million , $1.7 million and $1.6 million , respectively, and $6.8 million in 2022 through 2026. The amounts of accumulated other comprehensive loss expected to be recognized in net periodic pension cost during 2016 related to net actuarial losses are $0.4 million . The amount of accumulated other comprehensive income expected to be recognized in net periodic pension cost during 2016 related to prior service credit is immaterial. We expect to contribute approximately $2.0 million to our postretirement benefit plans in 2017. Assumptions The significant actuarial assumptions used to determine the present value of net benefit obligations for our defined benefit pension plans and other postretirement benefit plans were as follows: 2016 2015 2014 Discount Rate: U.S. plans 2.4-3.7% 3.2-4.5% 4.4 % International plans 0.9-3.2% 2.3-3.8% 2.9-4.3% Rates of future salary increases: U.S. plans 3.0-4.0% 3.0-4.0% 3.0-5.0% International plans 2.5-3.0% 2.5-3.0% 2.5-3.0% The significant assumptions used to determine the net periodic (income) cost for our pension and other postretirement benefit plans were as follows: 2016 2015 2014 Discount Rate: U.S. plans 3.2-4.5% 4.4 % 4.9 % International plans 2.3-3.8% 2.9-4.3% 3.5-4.8% Rates of future salary increases: U.S. plans 3.0-4.0% 3.0-5.0% 3.0-5.0% International plans 2.5-3.0% 2.5-3.0% 2.5-3.0% Rate of return on plans assets: U.S. plans 7.5 % 7.5 % 8.0 % International plans 5.3-5.5% 5.0-6.0% 5.0 % The rates of return on plan assets are based on historical performance, as well as future expected returns by asset class considering macroeconomic conditions, current portfolio mix, long-term investment strategy and other available relevant information. The annual assumed rate of increase in the per capita cost of covered benefits (the health care cost trend rate) for our postretirement benefit plans was as follows: 2016 2015 2014 Health care costs trend rate assumed for next year 8.5 % 7.3 % 7.5 % Rate to which the cost trend rate gradually declines 5.0 % 5.0 % 5.0 % Year that the rate reaches the rate at which it is assumed to remain 2027 2024 2024 A change of one percentage point in the assumed health care cost trend rates would have the following effects on the total service and interest cost components of our other postretirement cost and other postretirement benefit obligation at June 30, 2016: (in thousands) 1% Increase 1% Decrease Effect on total service and interest cost components $ 37 $ (33 ) Effect on other postretirement obligation 864 (776 ) Plan Assets The primary objective of certain of our pension plans' investment policies is to ensure that sufficient assets are available to provide the benefit obligations at the time the obligations come due. The overall investment strategy for the defined benefit pension plans' assets combine considerations of preservation of principal and moderate risk-taking. The assumption of an acceptable level of risk is warranted in order to achieve satisfactory results consistent with the long-term objectives of the portfolio. Fixed income securities comprise a significant portion of the portfolio due to their plan-liability-matching characteristics and to address the plans' cash flow requirements. Additionally, diversification of investments within each asset class is utilized to further reduce the impact of losses in single investments. Investment management practices must comply with ERISA and all applicable regulations and rulings thereof. The use of derivative instruments is permitted where appropriate and necessary for achieving overall investment policy objectives. Currently, the use of derivative instruments is not significant when compared to the overall investment portfolio. The Company utilizes a liability driven investment strategy (LDI) for the assets of its U.S. defined benefit pension plans in order to reduce the volatility of the funded status of these plans and to meet the obligations at an acceptable cost over the long term. This LDI strategy entails modifying the asset allocation and duration of the assets of the plans to more closely match the liability profile of these plans. The asset reallocation involves increasing the fixed income allocation, reducing the equity component and adding alternative investments. Longer duration interest rate swaps have been utilized periodically in order to increase the overall duration of the asset portfolio to more closely match the liabilities. Our defined benefit pension plans’ asset allocations as of June 30, 2016 and 2015 and target allocations for 2017, by asset class, were as follows: 2016 2015 Target % Equity 23 % 32 % 22.5 % Fixed Income 67 % 65 % 70.0 % Other 10 % 3 % 7.5 % The following sections describe the valuation methodologies used by the trustee to measure the fair value of the defined benefit pension plan assets, including an indication of the level in the fair value hierarchy in which each type of asset is generally classified (see Note 5 for the definition of fair value and a description of the fair value hierarchy). Corporate fixed income securities Investments in corporate fixed income securities consist of corporate debt and asset backed securities. These investments are classified as level two and are valued using independent observable market inputs such as the treasury curve, swap curve and yield curve. Common / collective trusts Investments in common / collective trusts invest primarily in publicly traded securities and are classified as level two and valued based on observable market data. Common stock Common stocks are classified as level one and are valued at their quoted market price. Government securities Investments in government securities consist of fixed income securities such as U.S. government and agency obligations and foreign government bonds and asset and mortgage backed securities such as obligations issued by government sponsored organizations. These investments are classified as level two and are valued using independent observable market inputs such as the treasury curve, credit spreads and interest rates. Other fixed income securities Investments in other fixed income securities are classified as level two and valued based on observable market data. Other Other investments consist primarily of state and local obligations and short term investments including cash, corporate notes, and various short term debt instruments which can be redeemed within a nominal redemption notice period. These investments are primarily classified as level two and are valued using independent observable market inputs. The fair value methods described may not be reflective of future fair values. Additionally, while the Company believes the valuation methods used by the plans’ trustee are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in different fair value measurement at the reporting date. The following table presents the fair value of the benefit plan assets classified under the appropriate level of the fair value hierarchy as of June 30, 2016: (in thousands) Level 1 Level 2 Level 3 Total Corporate fixed income securities $ — $ 395,102 $ — $ 395,102 Common / collective trusts: Value funds — 68,731 — 68,731 Growth funds — 38,126 — 38,126 Balanced funds — 8,581 — 8,581 Common stock 74,163 — — 74,163 Government securities: U.S. government securities — 79,275 — 79,275 Foreign government securities — 43,729 — 43,729 Other fixed income securities — 31,503 — 31,503 Other 3,029 79,436 — 82,465 Total investments $ 77,192 $ 744,483 $ — $ 821,675 The following table presents the fair value of the benefit plan assets classified under the appropriate level of the fair value hierarchy as of June 30, 2015: (in thousands) Level 1 Level 2 Level 3 Total Corporate fixed income securities $ — $ 391,275 $ — $ 391,275 Common / collective trusts: Value funds — 102,466 — 102,466 Growth funds — 54,179 — 54,179 Balanced funds — 10,090 — 10,090 Common stock 94,964 — — 94,964 Government securities: U.S. government securities — 68,628 — 68,628 Foreign government securities — 44,474 — 44,474 Other fixed income securities — 32,540 — 32,540 Other 3,396 25,325 — 28,721 Total investments $ 98,360 $ 728,977 $ — $ 827,337 Defined Contribution Plans We sponsor several defined contribution retirement plans. Costs for defined contribution plans were $17.2 million , $23.1 million and $20.4 million in 2016 , 2015 and 2014 , respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income | 12 Months Ended |
Jun. 30, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Loss | ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME Total accumulated other comprehensive loss (AOCL) consists of net 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 year ended June 30, 2016 (in thousands): Attributable to Kennametal: Post-retirement benefit plans Currency translation adjustment Derivatives Total Balance, June 30, 2015 $ (138,793 ) $ (97,309 ) $ (7,421 ) $ (243,523 ) Other comprehensive (loss) income before reclassifications (78,295 ) (51,508 ) (150 ) (129,953 ) Amounts Reclassified from AOCL 4,925 15,088 (1,563 ) 18,450 Net current period other comprehensive loss (73,370 ) (36,420 ) (1,713 ) (111,503 ) Sale of subsidiary stock to noncontrolling interest — 2,517 — 2,517 AOCL, June 30, 2016 $ (212,163 ) $ (131,212 ) $ (9,134 ) $ (352,509 ) Attributable to noncontrolling interests: Balance, June 30, 2015 $ — $ (2,258 ) $ — $ (2,258 ) Other comprehensive loss before reclassifications — (1,188 ) — (1,188 ) Net current period other comprehensive loss — (1,188 ) — (1,188 ) AOCL, June 30, 2016 $ — $ (3,446 ) $ — $ (3,446 ) The components of and changes in AOCL were as follows (net of tax) for the year ended June 30, 2015 (in thousands): Attributable to Kennametal: Post-retirement benefit plans Currency translation adjustment Derivatives Total Balance, June 30, 2014 $ (93,742 ) $ 38,811 $ (11,200 ) $ (66,131 ) Other comprehensive (loss) income before reclassifications (47,982 ) (136,120 ) 6,652 (177,450 ) Amounts Reclassified from AOCL 2,931 — (2,873 ) 58 Net current period other comprehensive loss (45,051 ) (136,120 ) 3,779 (177,392 ) AOCL, June 30, 2015 $ (138,793 ) $ (97,309 ) $ (7,421 ) $ (243,523 ) Attributable to noncontrolling interests: Balance, June 30, 2014 $ — $ 1,087 $ — $ 1,087 Other comprehensive income before reclassifications — (3,345 ) — (3,345 ) Net current period other comprehensive loss — (3,345 ) — (3,345 ) AOCL, June 30, 2015 $ — $ (2,258 ) $ — $ (2,258 ) The components of and changes in AOCL were as follows (net of tax) for the year ended June 30, 2014 (in thousands): Attributable to Kennametal: Post-retirement benefit plans Currency translation adjustment Derivatives Total Balance, June 30, 2013 $ (83,936 ) $ 7,413 $ (12,481 ) $ (89,004 ) Other comprehensive income (loss) before reclassifications (11,990 ) 31,398 (706 ) 18,702 Amounts Reclassified from AOCL 2,184 — 1,987 4,171 Net current period other comprehensive loss (9,806 ) 31,398 1,281 22,873 AOCL, June 30, 2014 $ (93,742 ) $ 38,811 $ (11,200 ) $ (66,131 ) Attributable to noncontrolling interests: Balance, June 30, 2013 $ — $ 721 $ — $ 721 Other comprehensive loss before — 366 — 366 Net current period other comprehensive loss — 366 — 366 AOCL, June 30, 2014 $ — $ 1,087 $ — $ 1,087 Reclassifications out of AOCL for the years ended June 30, 2016 , 2015 and 2014 consisted of the following: Year Ended June 30, Details about AOCL components 2016 2015 2014 Affected line item in the Income Statement Gains and losses on cash flow hedges: Forward starting interest rate swaps $ 2,099 $ 2,021 $ 1,945 Interest expense Currency exchange contracts (4,645 ) (6,700 ) 1,260 Other (income) expense, net Total before tax (2,546 ) (4,679 ) 3,205 Tax expense (benefit) 983 1,806 (1,218 ) Provision (benefit) for income taxes Net of tax $ (1,563 ) $ (2,873 ) $ 1,987 Post-retirement benefit plans: Amortization of transition obligations $ 80 $ 78 $ 78 See Note 13 for further details Amortization of prior service credit (439 ) (420 ) (345 ) See Note 13 for further details Recognition of actuarial losses 7,610 4,163 2,959 See Note 13 for further details Total before tax 7,251 3,821 2,692 Tax (benefit) (2,326 ) (890 ) (508 ) Provision (benefit) for income taxes Net of tax $ 4,925 $ 2,931 $ 2,184 Foreign currency translation adjustments: Released due to divestiture 15,088 — — Loss on divestiture Total before taxes 15,088 — — Tax benefit — — — Provision (benefit) for income taxes Net of tax $ 15,088 $ — $ — The amount of income tax allocated to each component of other comprehensive (loss) for the year ended June 30, 2016 : (in thousands) Pre-tax Tax impact Net of tax Unrealized loss on derivatives designated and qualified as cash flow hedges $ (244 ) $ 94 $ (150 ) Reclassification of unrealized gain on expired derivatives designated and qualified as cash flow hedges (2,546 ) 983 (1,563 ) Unrecognized net pension and other postretirement benefit loss (84,266 ) 5,971 (78,295 ) Reclassification of net pension and other postretirement benefit loss 7,251 (2,326 ) 4,925 Foreign currency translation adjustments (52,699 ) 4 (52,695 ) Reclassification of foreign currency translation adjustment loss realized upon sale 15,088 — 15,088 Other comprehensive (loss) $ (117,416 ) $ 4,726 $ (112,690 ) The amount of income tax allocated to each component of other comprehensive (loss) for the year ended June 30, 2015 : (in thousands) Pre-tax Tax impact Net of tax Unrealized gain on derivatives designated and qualified as cash flow hedges $ 10,834 $ (4,182 ) $ 6,652 Reclassification of unrealized gain on expired derivatives designated and qualified as cash flow hedges (4,679 ) 1,806 (2,873 ) Unrecognized net pension and other postretirement benefit loss (76,029 ) 28,047 (47,982 ) Reclassification of net pension and other postretirement benefit loss 3,821 (890 ) 2,931 Foreign currency translation adjustments (147,172 ) 7,707 (139,465 ) Other comprehensive (loss) $ (213,225 ) $ 32,488 $ (180,737 ) The amount of income tax allocated to each component of other comprehensive income for the year ended June 30, 2014 : (in thousands) Pre-tax Tax impact Net of tax Unrealized loss on derivatives designated and qualified as cash flow hedges (1,139 ) 433 (706 ) Reclassification of unrealized loss on expired derivatives designated and qualified as cash flow hedges 3,205 (1,218 ) 1,987 Unrecognized net pension and other postretirement benefit loss (15,900 ) 3,910 (11,990 ) Reclassification of net pension and other postretirement benefit loss 2,692 (508 ) 2,184 Foreign currency translation adjustments 33,493 (1,730 ) 31,763 Other comprehensive income 22,351 887 23,238 |
Restructuring and Related Charg
Restructuring and Related Charges and Asset Impairment Charges | 12 Months Ended |
Jun. 30, 2016 | |
Restructuring Charges [Abstract] | |
RESTRUCTURING AND RELATED CHARGES AND ASSET IMPAIRMENT CHARGES | RESTRUCTURING AND RELATED CHARGES AND ASSET IMPAIRMENT CHARGES Restructuring and Related Charges Phase 1 We implemented 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 were substantially completed in fiscal 2016 and were mostly cash expenditures. Total restructuring and related charges since inception of $59.3 million have been recorded for these Phase 1 programs through June 30, 2016 : $30.7 million in Industrial, $26.2 million in Infrastructure, and $2.4 million in Corporate. Ongoing restructuring programs We are currently implementing restructuring actions to streamline the Company's cost structure. These initiatives are expected to improve the alignment of our cost structure with the current operating environment through rationalization and consolidation of certain manufacturing facilities and through headcount reductions; enhancement of operational efficiencies through an enterprise-wide cost reduction program; and other employment and cost reduction programs. These restructuring actions are expected to be completed by December of fiscal 2019 and are anticipated to be mostly cash expenditures. The total pre-tax charges for these programs are expected to be in the range of $105 million to $125 million , which is expected to be approximately 65 percent Industrial and 35 percent Infrastructure. Total restructuring and related charges since inception of $71.4 million have been recorded for these programs through June 30, 2016 : $41.2 million in Industrial, $23.3 million in Infrastructure and $6.9 million in Corporate. Combined During 2016 , we recognized total restructuring and related charges of $53.5 million , of this amount, restructuring charges totaled $30.0 million . Total restructuring-related charges of $7.3 million were recorded in cost of goods sold and $16.2 million in operating expense during 2016 . During 2015 , we recognized total restructuring and related charges of $58.1 million , of this amount, restructuring charges totaled $42.1 million , of which $1.5 million were charges related to inventory disposals and were recorded in cost of goods sold. Total restructuring-related charges of $8.2 million were recorded in cost of goods sold and $7.8 million in operating expense during 2015 . During 2014, we recorded $19.1 million restructuring and related charges, of this amount, restructuring charges totaled $17.8 million , of which $0.2 million were charges related to inventory disposals and were recorded in cost of goods sold. Total restructuring-related charges of $1.2 million were recorded in cost of goods sold and $0.1 million in operating expense during 2014. The restructuring accrual is recorded in other current liabilities in our consolidated balance sheet and the amount attributable to each segment is as follows: (in thousands) June 30, 2015 Expense Asset Write-Down Other (2) Translation Cash Expenditures June 30, 2016 Industrial Severance $ 13,456 $ 17,322 $ — $ (347 ) $ (140 ) $ (21,202 ) $ 9,089 Facilities — 330 (780 ) — — 450 — Other 28 297 — — (5 ) 579 899 Total Industrial $ 13,484 $ 17,949 $ (780 ) $ (347 ) $ (145 ) $ (20,173 ) $ 9,988 Infrastructure Severance $ 7,173 $ 7,424 $ — $ (201 ) $ (60 ) $ (9,035 ) $ 5,301 Facilities 131 4,515 (3,914 ) — — (699 ) 33 Other — 127 — — (2 ) 256 381 Total Infrastructure 7,304 12,066 (3,914 ) (201 ) (62 ) (9,478 ) 5,715 Total $ 20,788 $ 30,015 $ (4,694 ) $ (548 ) $ (207 ) $ (29,651 ) $ 15,703 (2) Special termination benefit charge and settlement charge for one of our U.S.-based benefit pension plans resulting from executive retirement - see Note 13. (in thousands) June 30, 2014 Expense Asset Write-Down Other (3) Translation Cash Expenditures June 30, 2015 Industrial Severance $ 5,815 $ 20,713 $ — $ — $ (328 ) $ (12,744 ) $ 13,456 Facilities 444 2,277 (2,231 ) — (15 ) (475 ) — Other 67 77 — — (2 ) (114 ) 28 Total Industrial $ 6,326 $ 23,067 $ (2,231 ) $ — $ (345 ) $ (13,333 ) $ 13,484 Infrastructure Severance $ 2,458 $ 14,027 $ — $ (459 ) $ (223 ) $ (8,630 ) $ 7,173 Facilities 190 4,969 (3,638 ) — (32 ) (1,358 ) 131 Other 28 — — — (3 ) (25 ) — Total Infrastructure 2,676 18,996 (3,638 ) (459 ) (258 ) (10,013 ) 7,304 Total $ 9,002 $ 42,063 $ (5,869 ) $ (459 ) $ (603 ) $ (23,346 ) $ 20,788 (3) Special termination benefit charge for one of our U.S.-based benefit pension plans resulting from a plant closure - see Note 13. Asset impairment Charges See discussion on goodwill and other intangible asset impairment charges in Note 2. During 2016, we identified specific machinery and equipment that was no longer being utilized in the manufacturing organization of which we disposed by abandonment. As a result of this review, we recorded property, plant, and equipment impairment charges of $5.4 million during 2016, which has been presented in restructuring and asset impairment charges in our consolidated statement of income. |
Financial Instruments
Financial Instruments | 12 Months Ended |
Jun. 30, 2016 | |
Financial Instruments, Owned, at Fair Value [Abstract] | |
Financial Instruments Disclosure [Text Block] | FINANCIAL INSTRUMENTS The methods used to estimate the fair value of our financial instruments are as follows: Cash and Equivalents, Current Maturities of Long-Term Debt and Notes Payable to Banks The carrying amounts approximate their fair value because of the short maturity of the instruments. Long-Term Debt Fixed rate debt had a fair market value of $704.0 million and $698.0 million at June 30, 2016 and 2015 , respectively. The fair value is determined based on the quoted market price of this debt as of June 30 and were classified in Level 2 of the fair value hierarchy. Foreign Exchange Contracts The notional amount of outstanding foreign exchange contracts, translated at current exchange rates, was $53.3 million and $53.8 million at June 30, 2016 and 2015 , respectively. We would have received $0.3 million and $2.6 million at June 30, 2016 and 2015 , respectively, to settle these contracts representing the fair value of these agreements. The carrying value equaled the fair value for these contracts at June 30, 2016 and 2015 . Fair value was estimated based on quoted market prices of comparable instruments. Concentrations of Credit Risk Financial instruments that potentially subject us to concentrations of credit risk consist primarily of temporary cash investments and trade receivables. By policy, we make temporary cash investments with high credit quality financial institutions and limit the amount of exposure to any one financial institution. With respect to trade receivables, concentrations of credit risk are significantly reduced because we serve numerous customers in many industries and geographic areas. We are exposed to counterparty credit risk for nonperformance of derivatives and, in the unlikely event of nonperformance, to market risk for changes in interest and currency exchange rates, as well as settlement risk. We manage exposure to counterparty credit risk through credit standards, diversification of counterparties and procedures to monitor concentrations of credit risk. We do not anticipate nonperformance by any of the counterparties. As of June 30, 2016 and 2015 , we had no significant concentrations of credit risk. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Jun. 30, 2016 | |
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 2016 , 2015 and 2014 were as follows: 2016 2015 2014 Risk-free interest rate 1.4 % 1.5 % 1.3 % Expected life (years) (4) 4.5 4.5 4.5 Expected volatility (5) 31.7 % 32.5 % 40.3 % Expected dividend yield 2.1 % 1.7 % 1.7 % (4) Expected life is derived from historical experience. (5) Expected volatility is based on the implied historical volatility of our stock. Changes in our stock options for 2016 were as follows: Options Weighted Average Exercise Price Weighted Average Remaining Life (years) Aggregate Intrinsic value (in thousands) Options outstanding, June 30, 2015 2,094,037 $ 36.08 Granted 885,403 28.29 Exercised (39,177 ) 24.96 Lapsed and forfeited (392,454 ) 34.93 Options outstanding, June 30, 2016 2,547,809 $ 33.72 4.9 $ 602 Options vested and expected to vest, June 30, 2016 2,501,094 $ 33.79 4.8 $ 589 Options exercisable, June 30, 2016 1,625,728 $ 35.38 2.7 $ 89 During 2016 , 2015 and 2014 , compensation expense related to stock options was $3.3 million , $3.2 million and $4.3 million , respectively. As of June 30, 2016 , the total unrecognized compensation cost related to options outstanding was $2.5 million and is expected to be recognized over a weighted average period of 1.9 years. Weighted average fair value of options granted during 2016 , 2015 and 2014 was $6.45 , $10.16 and $13.76 , respectively. Fair value of options vested during 2016 , 2015 and 2014 was $2.3 million , $7.6 million and $5.1 million , respectively. Tax benefits relating to excess stock-based compensation deductions, are presented in the statement of cash flow as financing cash inflows. Tax benefits resulting from stock-based compensation deductions were less than the amounts reported for financial reporting purposes by $1.9 million in 2016 , and exceeded amounts reported for financial reporting purposes by $1.3 million and $6.0 million in 2015 and 2014 , respectively. The amount of cash received from the exercise of capital stock options during 2016 , 2015 and 2014 was $1.0 million , $11.7 million and $20.6 million , respectively. The related tax benefit was immaterial in 2016 , and was $2.0 million and $4.6 million in 2015 and 2014 , respectively. The total intrinsic value of options exercised was immaterial in 2016 , and was $5.3 million and $14.8 million in 2015 and 2014 , respectively. Under the provisions of the A/R 2010 Plan, participants may deliver stock, owned by the holder for at least six months, in payment of the option price and receive credit for the fair market value of the shares on the date of delivery. The fair market value of shares delivered during 2016 , 2015 and 2014 were immaterial. Restricted Stock Units – Time Vesting and Performance Vesting Performance vesting restricted stock units are earned pro rata each year if certain performance goals are met over a three -year period, and are also subject to a service condition that requires the individual to be employed by the Company at the payment date after the three -year performance period, with the exception of retirement eligible grantees, who upon retirement are entitled to receive payment for any units that have been earned, including a prorated portion in the partially completed fiscal year in which the retirement occurs. 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 2016 were as follows: Performance Vesting Stock Units Performance Vesting Weighted Average Fair Value Time Vesting Stock Units Time Vesting Weighted Average Fair Value Unvested performance vesting and time vesting restricted stock units, June 30, 2015 101,245 $ 43.00 689,268 $ 41.53 Granted 117,589 31.60 760,443 27.46 Vested — — (300,191 ) 40.68 Performance metric not achieved (42,697 ) 31.60 — — Forfeited (60,670 ) 32.70 (134,776 ) 35.80 Unvested performance vesting and time vesting restricted stock units, June 30, 2016 115,467 $ 36.96 1,014,744 $ 31.97 During 2016 , 2015 and 2014 , compensation expense related to time vesting and performance vesting restricted stock units was $14.6 million , $13.5 million and $13.1 million , respectively. As of June 30, 2016 , the total unrecognized compensation cost related to unvested time vesting and performance vesting restricted stock units was $14.1 million and is expected to be recognized over a weighted average period of 2.1 years. |
Environmental Matters
Environmental Matters | 12 Months Ended |
Jun. 30, 2016 | |
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 Among other environmental laws, we are subject to the Comprehensive Environmental Response Compensation and Liability Act of 1980 (Superfund), under which we have been designated by the United States Environmental Protection Agency (USEPA) as a potentially responsible party (PRP) with respect to environmental remedial costs at certain Superfund sites. We have evaluated our claims and liabilities associated with these Superfund sites based upon best currently available information. We believe our environmental accruals are adequate to cover our portion of the environmental remedial costs at the Superfund sites where we have been designated a PRP, to the extent these expenses are probable and reasonably estimable. Other Environmental Matters We establish and maintain reserves for other potential environmental issues. At June 30, 2016 and 2015 , the balance of these reserves was $12.5 million and $12.6 million , respectively. These reserves represent anticipated costs associated with the remediation of these issues. The reserves we have established for environmental liabilities represent our best current estimate of the costs of addressing all identified environmental situations, based on our review of currently available evidence, and taking into consideration our prior experience in remediation and that of other companies, as well as public information released by the USEPA, other governmental agencies and by the PRP groups in which we are participating. Although the reserves currently appear to be sufficient to cover these environmental liabilities, there are uncertainties associated with environmental liabilities, and we can give no assurance that our estimate of any environmental liability will not increase or decrease in the future. The reserved and unreserved liabilities for all environmental concerns could change substantially due to factors such as the nature and extent of contamination, changes in remedial requirements, technological changes, discovery of new information, the financial strength of other PRPs, the identification of new PRPs and the involvement of and direction taken by the government on these matters. We maintain a Corporate Environmental Health and Safety (EHS) Department to monitor compliance with environmental regulations and to oversee remediation activities. In addition, we have designated EHS coordinators who are responsible for each of our global manufacturing facilities. Our financial management team periodically meets with members of the Corporate EHS Department and the Corporate Legal Department to review and evaluate the status of environmental projects and contingencies. On a quarterly basis, we review financial provisions and reserves for environmental contingencies and adjust these reserves when appropriate. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | COMMITMENTS AND CONTINGENCIES Legal Matters Various lawsuits arising during the normal course of business are pending against us. In our opinion, the ultimate liability, if any, resulting from these matters will have no significant effect on our consolidated financial positions or results of operations. Lease Commitments We lease a wide variety of facilities and equipment under operating leases, primarily for warehouses, production and office facilities and equipment. Lease expense under these rentals amounted to $28.6 million , $29.4 million and $31.9 million in 2016 , 2015 and 2014 , respectively. Future minimum lease payments for non-cancelable operating leases are $18.6 million , $13.0 million , $9.9 million , $8.0 million and $6.8 million for the years 2017 through 2021 and $20.9 million thereafter. Purchase Commitments We have purchase commitments for materials, supplies and machinery and equipment as part of the ordinary conduct of business. Some of these commitments extend beyond one year and are based on minimum purchase requirements. We believe these commitments are not at prices in excess of current market. Other Contractual Obligations We do not have material financial guarantees or other contractual commitments that are reasonably likely to adversely affect our liquidity. Related Party Transactions Sales to affiliated companies were immaterial in 2016 , 2015 and 2014 . We do not have any other related party transactions that affect our operations, results of operations, cash flow or financial condition |
Segment Data
Segment Data | 12 Months Ended |
Jun. 30, 2016 | |
Segment Reporting [Abstract] | |
SEGMENT DATA | SEGMENT DATA The Company manages and reports its business in the following two segments: Industrial and Infrastructure. The Company's reportable operating segments have been determined in accordance with the Company's internal management structure, which is organized based on operating activities, the manner in which we organize segments for making operating decisions and assessing performance and the availability of separate financial results. We do not allocate certain corporate expenses related to executive retirement plans, the Company’s Board of Directors and strategic initiatives, as well as certain other costs and report them in Corporate. Neither of our two reportable operating segments represent the aggregation of two or more operating segments. Sales to a single customer did not aggregate 4 percent or more of total sales in 2016 , 2015 and 2014 . Export sales from U.S. operations to unaffiliated customers were $65.3 million , $71.0 million and $82.2 million in 2016 , 2015 and 2014 , respectively. INDUSTRIAL The Industrial segment generally serves customers that operate in industrial end markets such as transportation, general engineering, aerospace and defense. 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. INFRASTRUCTURE 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. Segment data is summarized as follows: (in thousands) 2016 2015 2014 Sales: Industrial $ 1,269,162 $ 1,461,744 $ 1,524,075 Infrastructure 829,274 1,185,451 1,313,115 Total sales $ 2,098,436 $ 2,647,195 $ 2,837,190 Operating (loss) income: Industrial $ 81,243 $ 160,894 $ 177,040 Infrastructure (246,306 ) (509,381 ) 94,940 Corporate (9,880 ) (9,336 ) (8,548 ) Total operating (loss) income $ (174,943 ) $ (357,823 ) $ 263,432 Interest expense $ 27,752 $ 31,466 $ 32,451 Other (income) expense, net (4,124 ) (1,674 ) 2,172 (Loss) income before income taxes $ (198,571 ) $ (387,615 ) $ 228,809 Depreciation and amortization: Industrial $ 62,942 $ 64,188 $ 65,820 Infrastructure 54,459 67,413 64,339 Corporate 65 63 63 Total depreciation and amortization $ 117,466 $ 131,664 $ 130,222 Equity income: Industrial $ — $ — $ 34 Infrastructure (10 ) 6 50 Total equity income $ (10 ) $ 6 $ 84 Total assets: Industrial $ 1,215,226 $ 1,259,270 $ 1,449,688 Infrastructure 849,447 1,279,608 1,986,724 Corporate 304,120 310,651 431,674 Total assets $ 2,368,793 $ 2,849,529 $ 3,868,086 Capital expenditures: Industrial $ 80,560 $ 64,497 $ 71,628 Infrastructure 30,137 36,442 45,748 Total capital expenditures $ 110,697 $ 100,939 $ 117,376 Investments in affiliated companies: Industrial $ — $ — $ — Infrastructure 2 361 495 Total investments in affiliated companies $ 2 $ 361 $ 495 Geographic information for sales, based on country of origin, and assets is as follows: (in thousands) 2016 2015 2014 Sales: United States $ 897,399 $ 1,176,622 $ 1,198,541 Germany 334,366 442,009 511,209 China 210,124 246,953 248,212 India 77,934 85,193 81,455 Italy 69,821 85,530 107,511 France 56,264 59,772 63,473 Canada 55,812 73,912 78,163 United Kingdom 50,723 70,600 105,041 Other 345,993 406,604 443,585 Total sales $ 2,098,436 $ 2,647,195 $ 2,837,190 Total assets: United States $ 1,075,330 $ 1,338,594 $ 1,842,453 Germany 327,679 394,491 538,661 China 233,200 274,774 341,949 Switzerland 189,498 194,139 264,928 India 91,544 97,463 94,897 Canada 57,174 60,492 133,481 Italy 50,352 94,978 178,141 United Kingdom 48,507 71,342 79,657 Other 295,509 323,256 393,919 Total assets: $ 2,368,793 $ 2,849,529 $ 3,868,086 Approximate sales by end markets as a percentage of consolidated sales are as follows: 2016 2015 2014 End markets: General engineering 38 % 36 % 31 % Transportation 21 21 21 Energy 17 19 23 Earthworks 16 17 19 Aerospace and defense 8 7 6 Total 100 % 100 % 100 % |
Selected Quarterly Financial Da
Selected Quarterly Financial Data | 12 Months Ended |
Jun. 30, 2016 | |
Quarterly Financial Data [Abstract] | |
Quarterly Financial Information [Text Block] | SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) For the quarter ended (in thousands, except per share data) September 30 December 31 March 31 June 30 2016 Sales $ 555,354 $ 524,021 $ 497,837 $ 521,224 Gross profit 151,224 140,806 157,353 166,684 Net (loss) income attributable to Kennametal (6,226 ) (169,227 ) 16,000 (66,515 ) Basic (loss) earnings per share attributable to Kennametal (6) Net income (0.08 ) (2.12 ) 0.20 (0.83 ) Diluted (loss) earnings per share attributable to Kennametal (6) Net income (0.08 ) (2.12 ) 0.20 (0.83 ) 2015 Sales $ 694,941 $ 675,631 $ 638,970 $ 637,653 Gross profit 218,009 199,458 199,470 188,966 Net income (loss) attributable to Kennametal 39,489 (388,302 ) (46,229 ) 21,146 Basic earnings (loss) per share attributable to Kennametal (6) Net income 0.50 (4.89 ) (0.58 ) 0.27 Diluted earnings (loss) per share attributable to Kennametal (6) Net income 0.49 (4.89 ) (0.58 ) 0.26 (6) Earnings per share amounts attributable to Kennametal for each quarter are computed using the weighted average number of shares outstanding during the quarter. Earnings per share amounts attributable to Kennametal for the full year are computed using the weighted average number of shares outstanding during the year. Thus, the sum of the four quarters’ earnings per share attributable to Kennametal does not always equal the full-year earnings per share attributable to Kennametal. |
Schedule II Valuation and Quali
Schedule II Valuation and Qualifying Accounts and Reserves | 12 Months Ended |
Jun. 30, 2016 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule of Valuation and Qualifying Accounts Disclosure | SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS AND RESERVES (In thousands) For the year ended June 30 Balance at Beginning of Year Charges to Costs and Expenses Charged to Other Comprehensive (Loss) Income Recoveries Other Adjustments Deductions from Reserves Balance at End of Year 2016 Allowance for doubtful accounts $ 13,560 $ 4,827 $ — $ 31 $ (601 ) (1) $ (5,093 ) (2) $ 12,724 Reserve for excess and obsolete inventory 45,020 5,393 — — (3,372 ) (1) (10,328 ) (3) 36,713 Deferred tax asset valuation allowance 16,771 85,361 (5) 24,666 (5) — (4,099 ) (1) — 122,699 2015 Allowance for doubtful accounts $ 14,027 $ 3,602 $ — $ 40 $ (1,095 ) (1) $ (3,014 ) (2) $ 13,560 Reserve for excess and obsolete inventory 52,737 8,666 — — (5,613 ) (1) (10,770 ) (3) 45,020 Deferred tax asset valuation allowance 17,860 1,846 — — (2,935 ) (1) — 16,771 2014 Allowance for doubtful accounts $ 11,949 $ 2,880 $ — $ 207 $ 111 (1) $ (1,120 ) (2) $ 14,027 Reserve for excess and obsolete inventory 52,739 9,252 — — 1,317 (1) (10,571 ) (3) 52,737 Deferred tax asset valuation allowance 15,569 3,001 24 — 505 (1) (1,239 ) (4) 17,860 (1) Represents foreign currency translation adjustment and reserves divested through business combinations. (2) Represents uncollected accounts charged against the allowance. (3) Represents scrapped inventory and other charges against the reserve. (4) Represents a forfeited net operating loss deduction. (5) Represents primarily effects from recording of a valuation allowance against our net deferred tax assets in the U.S. |
Summary of Significant Accoun30
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | PRINCIPLES OF CONSOLIDATION The consolidated financial statements include our accounts and those of our majority-owned subsidiaries. All significant intercompany balances and transactions are eliminated. Investments in entities of less than 50 percent of the voting stock over which we have significant influence are accounted for on an equity basis. The factors used to determine significant influence include, but are not limited to, our management involvement in the investee, such as hiring and setting compensation for management of the investee, the ability to make operating and capital decisions of the investee, representation on the investee’s board of directors and purchase and supply agreements with the investee. Investments in entities of less than 50 percent of the voting stock in which we do not have significant influence are accounted for on the cost basis. |
Use of Estimates in the Preparation of Financial Statements | USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS In preparing our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP), we make judgments and estimates about the amounts reflected in our financial statements. As part of our financial reporting process, our management collaborates to determine the necessary information on which to base our judgments and develop estimates used to prepare the financial statements. We use historical experience and available information to make these judgments and estimates. However, different amounts could be reported using different assumptions and in light of different facts and circumstances. Therefore, actual amounts could differ from the estimates reflected in our financial statements. |
Cash and Cash Equivalents | CASH AND CASH EQUIVALENTS Cash investments having original maturities of three months or less are considered cash equivalents. Cash equivalents principally consist of investments in money market funds and bank deposits at June 30, 2016 . |
Accounts Receivable | ACCOUNTS RECEIVABLE We market our products to a diverse customer base throughout the world. Trade credit is extended based upon periodically updated evaluations of each customer’s ability to satisfy its obligations. We make judgments as to our ability to collect outstanding receivables and provide allowances for the portion of receivables when collection becomes doubtful. Accounts receivable reserves are determined based upon an aging of accounts and a review of specific accounts. |
Inventory | INVENTORIES Inventories are stated at the lower of cost or market. We use the last-in, first-out (LIFO) method for determining the cost of a significant portion of our United States (U.S.) inventories. The cost of the remainder of our inventories is determined under the first-in, first-out or average cost methods. When market conditions indicate an excess of carrying costs over market value, a lower-of-cost-or-market provision is recorded. Excess and obsolete inventory reserves are established based upon our evaluation of the quantity of inventory on hand relative to demand. The excess and obsolete inventory reserve at June 30, 2016 and 2015 was $36.7 million and $45.0 million , respectively. |
Property, Plant and Equipment | PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are carried at cost. Major improvements are capitalized, while maintenance and repairs are expensed as incurred. Retirements and disposals are removed from cost and accumulated depreciation accounts, with the gain or loss reflected in operating income. Interest related to the construction of major facilities is capitalized as part of the construction costs and is depreciated over the facilities' estimated useful lives. Depreciation for financial reporting purposes is computed using the straight-line method over the following estimated useful lives: building and improvements over 15 - 40 years; machinery and equipment over 4 - 15 years; furniture and fixtures over 5 - 10 years and computer hardware and software over 3 - 5 years. Leased property and equipment under capital leases are depreciated using the straight-line method over the terms of the related leases. |
Long Lived Assets | LONG-LIVED ASSETS We evaluate the recoverability of property, plant and equipment and intangible assets that are amortized, whenever events or changes in circumstances indicate the carrying amount of any such assets may not be fully recoverable. Changes in circumstances include technological advances, changes in our business model, capital structure, economic conditions or operating performance. Our evaluation is based upon, among other things, our assumptions about the estimated future undiscounted cash flows these assets are expected to generate. When the sum of the undiscounted cash flows is less than the carrying value of the asset or asset group, we will recognize an impairment loss to the extent that carrying value exceeds fair value. We apply our best judgment when performing these evaluations to determine if a triggering event has occurred, the undiscounted cash flows used to assess recoverability and the fair value of the asset. |
Goodwill and Other Intangible Assets | GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill represents the excess of cost over the fair value of the net assets of acquired companies. Goodwill and other intangible assets with indefinite lives are tested at least annually for impairment. We perform our annual impairment tests during the June quarter in connection with our annual planning process, unless there are impairment indicators based on the results of an ongoing cumulative qualitative assessment that warrant a test prior to that. 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. Identifiable assets with finite lives are reviewed for impairment when events or circumstances indicate that the carrying value may not be recoverable. During the December quarter of fiscal 2016, we performed an interim review of our identifiable assets with finite lives and preliminarily determined that the assets were not impaired. During the March quarter of fiscal 2016, we completed the finalization of fair values related to intangibles and property, plant and equipment. We also completed a review of our identifiable assets with finite lives and determined that the assets were not impaired. Acquisition Impact on Goodwill On November 4, 2013, we acquired TMB from Allegheny Technologies Incorporated (ATI), the operations of which are included in both the Industrial and Infrastructure segments. As a result of the acquisition, we increased goodwill by $246.6 million in based on our purchase price allocations, $3.0 million of which was recorded in the Industrial segment in 2015 based on finalization of the purchase price allocation. The goodwill recorded relates to operating synergies associated with the acquisition that we expected to realize. Goodwill of $202.1 million was deductible for tax purposes. 2015 December Quarter Impairment Charge As previously disclosed, we recorded a non-cash pre-tax impairment charge during the three months ended December 31, 2014 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. 2015 March Quarter Impairment Charge As previously disclosed, we recorded an additional non-cash pre-tax impairment charge during the three months ended March 31, 2015 of $152.9 million in the Infrastructure reporting unit, of which $152.5 million was for goodwill and $0.4 million was for an indefinite-lived trademark intangible asset. In addition, we recorded an additional $6.8 million charge during the three months ended March 31, 2015 for an indefinite-lived trademark intangible asset based upon completion of the 2015 December valuation. During 2015, 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 . 2016 December Quarter Impairment Charge Late in the December quarter of fiscal 2016, the Company experienced a further unexpected deterioration in customer demand in many of its end markets and certain geographies at that time. Industrial production indices in the U.S. and China declined, as well as further reductions in mining and oil and gas activity. In view of these declines and the significant impact on our near term financial forecasts as well as a significant and sustained decline in the Company’s stock price, we determined an interim impairment test of our goodwill and other long-lived assets of our Industrial and Infrastructure reporting units was required. As a result of this interim test, we recorded a preliminary non-cash pre-tax impairment charge during the three months ended December 31, 2015 of $106.1 million in the Infrastructure segment, of which $105.7 million was for goodwill and $0.4 million was for an indefinite-lived trademark intangible asset. We also recorded a preliminary non-cash pre-tax impairment charge during the three months ended December 31, 2015 of $2.3 million in the Industrial segment for an indefinite-lived trademark intangible asset. These impairment charges are recorded in restructuring and asset impairment charges in our consolidated statements of income. There is $298.5 million of goodwill at the Industrial reporting unit. The Industrial reporting unit passed the 2016 interim and annual goodwill impairment tests with fair value substantially exceeded the carrying value. No goodwill remains with the Infrastructure reporting unit as of June 30, 2016 . 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 cannot provide assurance that we will achieve all of the anticipated benefits from restructuring actions we have taken and expect to continue to take. If we are unable to effectively restructure our operations in the light of evolving market conditions, it could have a material adverse effect on our business, financial condition, results of operations and cash flows. We are currently exploring strategic alternatives for a remaining non-core Infrastructure business. The estimated net book value of the business is approximately $30 million as of June 30, 2016 . As the strategic direction has not yet been determined for these businesses, the Company cannot determine if additional impairment charges will be incurred. We recorded no goodwill and other intangible asset impairment charges in 2014 . Divestiture Impact on Goodwill During 2016, we completed the sale of non-core businesses, see Note 4. As a result of this transaction, goodwill decreased by $1.1 million and $6.5 million in our Industrial and Infrastructure segments, respectively. These decreases are recorded in loss on divestiture in our consolidated statements of income. Divestiture Impact on Other Intangible Assets The divestiture of non-core businesses completed during 2016 resulted in a reduction of $30.0 million in customer-related, $15.4 million in unpatented technology, $5.0 million in indefinite-lived trademarks, $1.1 million in definite-lived trademarks, $0.8 million in technology-based and other and $0.5 million in contract-based. |
Pension and Other Postretirement Benefits | PENSION AND OTHER POSTRETIREMENT BENEFITS We sponsor these types of benefit plans for certain employees and retirees. Accounting for the cost of these plans requires the estimation of the cost of the benefits to be provided well into the future and attributing that cost over the expected work life of employees participating in these plans. This estimation requires our judgment about the discount rate used to determine these obligations, expected return on plan assets, rate of future compensation increases, rate of future health care costs, withdrawal and mortality rates and participant retirement age. Differences between our estimates and actual results may significantly affect the cost of our obligations under these plans. In the valuation of our pension and other postretirement benefit liabilities, management utilizes various assumptions. Discount rates are derived by identifying a theoretical settlement portfolio of high quality corporate bonds sufficient to provide for a plan’s projected benefit payments. This rate can fluctuate based on changes in the corporate bond yields. The long-term rate of return on plan assets is estimated based on an evaluation of historical returns for each asset category held by the plans, coupled with the current and short-term mix of the investment portfolio. The historical returns are adjusted for expected future market and economic changes. This return will fluctuate based on actual market returns and other economic factors. The rate of future health care costs is based on historical claims and enrollment information projected over the next year and adjusted for administrative charges. This rate is expected to decrease until 2027. Future compensation rates, withdrawal rates and participant retirement age are determined based on historical information. These assumptions are not expected to significantly change. Mortality rates are determined based on a review of published mortality tables. |
Earnings Per Share | EARNINGS PER SHARE Basic earnings per share is computed using the weighted average number of shares outstanding during the period, while diluted earnings per share is calculated to reflect the potential dilution that occurs related to the issuance of capital stock under stock option grants, restricted stock awards and restricted stock units. The difference between basic and diluted earnings per share relates solely to the effect of capital stock options, restricted stock awards and restricted stock units. In 2016 and 2015 , 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 at June 30, 2014 , weighted average shares outstanding for basic earnings per share calculations were increased due solely to the dilutive effect of unexercised capital stock options, unvested restricted stock awards and unvested restricted stock units by 1.0 million shares. Unexercised capital stock options, unvested restricted stock awards and restricted stock units of 0.3 million shares at June 30, 2014 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. |
Revenue Recognition | REVENUE RECOGNITION We recognize revenue for our products and assembled machines when title and all risks of loss and damages pass to the buyer. Our general conditions of sale explicitly state that the delivery of our products and assembled machines is freight on board shipping point and that title and all risks of loss and damage pass to the buyer upon delivery of the sold products or assembled machines to the common carrier. Our general conditions of sale explicitly state that acceptance of the conditions of shipment are considered to have occurred unless written notice of objection is received by Kennametal within 10 calendar days of the date specified on the invoice. We do not ship products or assembled machines unless we have documentation from our customers authorizing shipment. Our products are consumed by our customers in the manufacture of their products. Historically, we have experienced very low levels of returned products and assembled machines and do not consider the effect of returned products and assembled machines to be material. We have recorded an estimated returned goods allowance to provide for any potential returns. We warrant that products and services sold are free from defects in material and workmanship under normal use and service when correctly installed, used and maintained. This warranty terminates 30 days after delivery of the product to the customer and does not apply to products that have been subjected to misuse, abuse, neglect or improper storage, handling or maintenance. Products may be returned to Kennametal, only after inspection and approval by Kennametal and upon receipt by the customer of shipping instructions from Kennametal. We have included an estimated allowance for warranty returns in our returned goods allowance. We recognize revenue related to the sale of specialized assembled machines upon customer acceptance and installation, as installation is deemed essential to the functionality of a specialized assembled machine. Sales of specialized assembled machines were immaterial for 2016 , 2015 and 2014 . |
Stock-Based Compensation | STOCK-BASED COMPENSATION We recognize stock-based compensation expense for all stock options, restricted stock awards and restricted stock units over the period from the date of grant to the date when the award is no longer contingent on the employee providing additional service (substantive vesting period). We utilize the Black-Scholes valuation method to establish the fair value of all stock option awards. 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. Capital stock options are granted to eligible employees at fair market value at the date of grant. Capital stock options are exercisable under specified conditions for up to 10 years from the date of grant. The Kennametal Inc. Stock and Incentive Plan of 2010, as Amended and Restated on October 22, 2013, and as further amended January 27, 2015 (A/R 2010 Plan) authorizes the issuance of up to 9,500,000 shares of the Company’s capital stock plus any shares remaining unissued under the Kennametal Inc. Stock and Incentive Plan of 2002, as amended (2002 Plan). Under the provisions of the A/R 2010 Plan participants may deliver stock, owned by the holder for at least six months, in payment of the option price and receive credit for the fair market value of the shares on the date of delivery. The fair market value of shares delivered during 2016 , 2015 and 2014 was immaterial. In addition to stock option grants, the A/R 2010 Plan permits the award of stock appreciation rights, performance share awards, performance unit awards, restricted stock awards, restricted unit awards and share awards to directors, officers and key employees. |
Research and Development Costs | RESEARCH AND DEVELOPMENT COSTS Research and development costs of $39.4 million , $45.1 million and $44.0 million in 2016 , 2015 and 2014 , respectively, were expensed as incurred. These costs are included in operating expense in the consolidated statements of income. |
Shipping and Handling Fees and Costs | SHIPPING AND HANDLING FEES AND COSTS All fees billed to customers for shipping and handling are classified as a component of sales. All costs associated with shipping and handling are classified as a component of cost of goods sold. |
Income Taxes | INCOME TAXES Deferred income taxes are recognized based on the future income tax effects (using enacted tax laws and rates) of differences in the carrying amounts of assets and liabilities for financial reporting and tax purposes. A valuation allowance is recognized if it is “more likely than not” that some or all of a deferred tax asset will not be realized. |
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 use derivative financial instruments to provide predictability to the effects of changes in foreign exchange rates on our consolidated results, achieve our targeted mix of fixed and floating interest rates on outstanding debt. Our objective in managing foreign exchange exposures with derivative instruments is to reduce volatility in cash flow, allowing us to focus more of our attention on business operations. With respect to interest rate management, these derivative instruments allow us to achieve our targeted fixed-to-floating interest rate mix, as a separate decision from funding arrangements, in the bank and public debt markets. We account for derivative instruments as a hedge of the related asset, liability, firm commitment or anticipated transaction, when the derivative is specifically designated as a hedge of such items. 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 (income) expense, net. Certain currency forward contracts hedging significant cross-border intercompany loans are considered other derivatives and, therefore, do not qualify for hedge accounting. These contracts are recorded at fair value in the balance sheet, with the offset to other (income) expense, net. |
Cash Flow Hedges | CASH FLOW HEDGES Currency Forward contracts and 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) income, and are recognized as a component of other (income) expense, net when the underlying sale of products or services is recognized into earnings. Interest Rate Floating-to-fixed interest rate swap contracts, designated as cash flow hedges, are entered into from time to time to hedge our exposure to interest rate changes on a portion of our floating rate debt. These interest rate swap contracts convert a portion of our floating rate debt to fixed rate debt. We record the fair value of these contracts as an asset or a liability, as applicable, in the balance sheet, with the offset to accumulated other comprehensive (loss) income. |
Fair Value Hedges | FAIR VALUE HEDGES Interest Rate Fixed-to-floating interest rate swap contracts, designated as fair value hedges, are entered into from time to time to hedge our exposure to fair value fluctuations on a portion of our fixed rate debt. These interest rate swap contracts convert a portion of our fixed rate debt to floating rate debt. When in place, these contracts require periodic settlement, and the difference between amounts to be received and paid under the contracts is recognized in interest expense. |
Currency Translation | CURRENCY TRANSLATION Assets and liabilities of international operations are translated into U.S. dollars using year-end exchange rates, while revenues and expenses are translated at average exchange rates throughout the year. The resulting net translation adjustments are recorded as a component of accumulated other comprehensive (loss) income. The local currency is the functional currency of most of our locations. A gain of $1.6 million , a gain of $1.7 million and a loss of $2.5 million from currency transactions were included in other (income) expense, net in 2016 , 2015 and 2014 , respectively. |
New Accounting Standards | NEW ACCOUNTING STANDARDS Adopted In April 2014, the Financial Accounting Standards Board (FASB) issued guidance on reporting discontinued operations and disclosures of disposals of components of an entity. Under the guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. Additionally, the guidance requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income and expenses of discontinued operations. The guidance also requires disclosure of the pre-tax income attributable to a disposal of a significant part of an organization that does not qualify for discontinued operations reporting. This guidance was effective for Kennametal beginning July 1, 2015. The divestiture of non-core businesses outlined in Note 4 was evaluated under this guidance. Issued In June 2016, the FASB issued guidance on measurement of credit losses on financial instruments. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. The scope of this amendment includes valuation of trade receivables. This standard is effective for Kennametal beginning July 1, 2020. We are in the process of assessing the impact the adoption of this guidance will have on our consolidated financial statements. In May 2016, the FASB issued guidance on narrow scope improvements and practical expedients as part of Topic 606: Revenue from Contracts with Customers. The amendments address collectability criterion and accounting for contracts that do not meet the criteria, presentation of sales taxes and other similar taxes collected from customers, noncash consideration, contract modifications at transition and completed contracts at transition, in addition to a technical correction. This standard is effective for Kennametal beginning July 1, 2018, in conjunction with the adoption of Accounting Standards Update 2014-09, “Revenue from Contracts with Customers: Topic 606.” We are in the process of assessing the impact the adoption of this guidance will have on our consolidated financial statements. In April 2016, the FASB issued guidance on identifying performance obligations and licensing as part of Topic 606: Revenue from Contracts with Customers. The amendments in this update clarify identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. This standard is effective for Kennametal beginning July 1, 2018, in conjunction with the adoption of Accounting Standards Update 2014-09, “Revenue from Contracts with Customers: Topic 606.” We are in the process of assessing the impact the adoption of this guidance will have on our consolidated financial statements. In March 2016, the FASB issued guidance intended to simplify equity-based award accounting and presentation. The guidance impacts income tax accounting related to equity-based awards, the classification of awards as either equity or liabilities, and the classification on the statement of cash flows. This standard is effective for Kennametal beginning July 1, 2017. We are in the process of assessing the impact the adoption of this guidance will have on our consolidated financial statements. In March 2016, the FASB issued guidance on principal versus agent considerations in reporting revenue gross versus net. This guidance is intended to improve the operability and understandability of the implementation guidance on principal versus agent considerations. As this update serves to clarify existing guidance, it is not expected to have a material impact on our consolidated financial statements. In February 2016, the FASB issued guidance on lease accounting, which replaces the existing guidance in ASC 840, Leases. The standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. This standard is effective for Kennametal beginning July 1, 2019. We are in the process of assessing the impact the adoption of this guidance will have on our consolidated financial statements. In November 2015, the FASB issued guidance on balance sheet classification of deferred taxes. The amendments in this Update require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position, as opposed to the current practice of separating deferred income tax liabilities and assets into current and noncurrent amounts on the balance sheet. This standard is effective for Kennametal beginning July 1, 2017. We are in the process of assessing the impact the adoption of this ASU will have on our consolidated financial statements. In August 2015, the FASB issued guidance that defers the effective date of previously issued ASU 2014-09, “Revenue from Contracts with Customers: Topic 606.” Under this guidance, the effective date for Kennametal was deferred from July 1, 2017 to July 1, 2018. We are in the process of assessing the impact the adoption of this ASU will have on our consolidated financial statements. In July 2015, the FASB issued guidance on subsequent measurement of inventory. The amendments in this update require that inventory other than LIFO be subsequently measured at the lower of cost and net realizable value, as opposed to the current practice of lower of cost or market. Subsequent measurement is unchanged for inventory measured using LIFO. This standard is effective for Kennametal beginning July 1, 2017. We are in the process of evaluating the impact of adoption on our consolidated financial statements. In April 2015, the FASB issued guidance on the presentation of debt issuance costs. The guidance requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct reduction from the carrying amount of that debt liability, consistent with debt discounts. This standard is effective for Kennametal beginning July 1, 2016 and will be retrospectively applied. The guidance did not have a material impact on our consolidated financial position, results of operations and cash flows. In April 2015, the FASB issued guidance on accounting for fees paid in a cloud computing arrangement. The amendments in this update provide guidance to customers about whether a cloud computing arrangement includes a software license and accounting for the arrangement as capitalized and amortized as an intangible asset or expensed as incurred as a service contract. This standard is effective for Kennametal beginning July 1, 2016. The provisions of the guidance may be applied prospectively or retrospectively. We plan to adopt this guidance prospectively, and adoption of this ASU is not expected to have a material impact on our consolidated financial position, results of operations and cash flows. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers: Topic 606.” This ASU replaces nearly all existing U.S. GAAP guidance on revenue recognition. The standard prescribes a five-step model for recognizing revenue, the application of which will require significant judgment. This standard is effective for Kennametal July 1, 2017. We are in the process of assessing the impact the adoption of this ASU will have on our consolidated financial statements. |
Supplemental Cash Flow Inform31
Supplemental Cash Flow Information (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Disclosures | Year ended June 30 (in thousands) 2016 2015 2014 Cash paid during the period for: Interest $ 26,250 $ 30,984 $ 29,836 Income taxes 43,733 40,295 49,393 Supplemental disclosure of non-cash information: Changes in accounts payable related to purchases of property, plant and equipment 1,000 (9,900 ) 2,100 |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
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: Year ended June 30 (in thousands) 2014 Pro forma (unaudited): Net Sales $ 2,941,005 Net income attributable to Kennametal $ 175,804 Per share data attributable to Kennametal Shareholders : Basic earnings per share $ 2.23 Diluted earnings per share $ 2.21 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Financial instruments at fair value on recurring basis | As of June 30, 2016 , 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) $ — $ 334 $ — $ 334 Total assets at fair value $ — $ 334 $ — $ 334 Liabilities: Derivatives (1) $ — $ 763 $ — $ 763 Contingent consideration — — 6,600 6,600 Total liabilities at fair value $ — $ 763 $ 6,600 $ 7,363 There have been no changes in classification and transfers between levels in the fair value hierarchy in the current period. 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 a previous acquisition. The contingent consideration is expected to be paid over the next six months and is recorded in other current liabilities in our consolidated balance sheet. The Company reassessed this contingent consideration and determined that an adjustment of $3.4 million to reduce the fair value of the remaining contingent consideration was necessary during 2016 due to agreed upon terms with the seller that they did not achieve certain milestone targets and to a return of inventory to the seller during the period. No other changes in the expected outcome have occurred during 2016. As of June 30, 2015 , 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) $ — $ 2,678 $ — $ 2,678 Total assets at fair value $ — $ 2,678 $ — $ 2,678 Liabilities: Derivatives (1) $ — $ 44 $ — $ 44 Contingent consideration — — 10,000 10,000 Total liabilities at fair value $ — $ 44 $ 10,000 $ 10,044 (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 He34
Derivative Instruments and Hedging Activities (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair value of derivatives designated and not designated as hedging instruments | The fair value of derivatives designated and not designated as hedging instruments in the consolidated balance sheet are as follows: (in thousands) 2016 2015 Derivatives designated as hedging instruments Other current assets - range forward contracts $ 323 $ 2,626 Total derivatives designated as hedging instruments 323 2,626 Derivatives not designated as hedging instruments Other current assets - currency forward contracts 11 52 Other current liabilities - currency forward contracts (763 ) (44 ) Total derivatives not designated as hedging instruments (752 ) 8 Total derivatives $ (429 ) $ 2,634 |
Losses (gains) related to derivatives not designated as hedging instruments | osses (gains) related to derivatives not designated as hedging instruments have been recognized as follows: (in thousands) 2016 2015 2014 Other (income) expense, net - currency forward contracts $ 719 $ (1,026 ) $ 1,057 |
Losses related to cash flow hedges | The following represents gains and losses related to cash flow hedges: (in thousands) 2016 2015 2014 Gains (losses) recognized in other comprehensive loss (income), net $ (297 ) $ 6,651 $ (702 ) Losses (gains) reclassified from accumulated other comprehensive loss into other (income) expense, net $ 381 $ (250 ) $ 1,399 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consisted of the following at June 30: (in thousands) 2016 2015 Finished goods $ 284,054 $ 324,840 Work in process and powder blends 166,274 249,629 Raw materials 68,472 100,881 Inventories at current cost 518,800 675,350 Less: LIFO valuation (59,970 ) (99,819 ) Total inventories $ 458,830 $ 575,531 |
Goodwill and Other Intangible36
Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets [Abstract] | |
Schedule of Goodwill [Table Text Block] | 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 year ended June 30, 2015: Acquisition 2,984 — 2,984 Translation (19,950 ) (13,721 ) (33,671 ) Change in gross goodwill (16,966 ) (13,721 ) (30,687 ) Gross goodwill 455,371 640,360 1,095,731 Accumulated impairment losses (150,842 ) (527,500 ) (678,342 ) Balance as of June 30, 2015 $ 304,529 $ 112,860 $ 417,389 Activity for the year ended June 30, 2016: Divestiture (1,075 ) (6,461 ) (7,536 ) Translation (4,967 ) (688 ) (5,655 ) Change in gross goodwill (6,042 ) (7,149 ) (13,191 ) Impairment charges — (105,711 ) (105,711 ) Gross goodwill 449,329 633,211 1,082,540 Accumulated impairment losses (150,842 ) (633,211 ) (784,053 ) Balance as of June 30, 2016 $ 298,487 $ — $ 298,487 |
Components of Other Intangible Assets [Table Text Block] | The components of our other intangible assets were as follows: Estimated Useful Life (in years) June 30, 2016 June 30, 2015 (in thousands) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Contract-based 3 to 15 $ 7,152 $ (6,886 ) $ 8,523 $ (6,990 ) Technology-based and other 4 to 20 47,323 (27,011 ) 52,820 (29,723 ) Customer-related 10 to 21 205,471 (66,938 ) 275,796 (90,141 ) Unpatented technology 10 to 30 31,837 (4,614 ) 59,449 (14,426 ) Trademarks 5 to 20 12,668 (8,644 ) 18,575 (12,090 ) Trademarks Indefinite 16,850 — 24,876 — Total $ 321,301 $ (114,093 ) $ 440,039 $ (153,370 ) |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Other Liabilities, Current [Abstract] | |
Other Current Liabilities [Text Block] | Other current liabilities consisted of the following at June 30: (in thousands) 2016 2015 Accrued employee benefits $ 33,754 $ 40,995 Accrued restructuring (Note 15) 15,703 20,788 Payroll, state and local taxes 12,983 15,006 Accrued legal and professional fees 12,112 11,710 Accrued interest 7,079 7,040 Other 70,638 83,139 Total other current liabilities $ 152,269 $ 178,678 |
Long-Term Debt and Capital Le38
Long-Term Debt and Capital Leases (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Schedule of Debt [Abstract] | |
Schedule of Debt [Table Text Block] | Long-term debt and capital lease obligations consisted of the following at June 30: (in thousands) 2016 2015 2.65% Senior Unsecured Notes due 2019 net of discount of $0.3 million for 2016 and $0.3 million for 2015 $ 399,748 $ 399,671 3.875% Senior Unsecured Notes due 2022 net of discount of $0.2 million for 2016 and $0.2 million for 2015 299,794 299,757 Credit Agreement: Euro-denominated borrowings, 0.9% to 1.1% in 2016 and 2015, due 2021 — 42,609 U.S. Dollar-denominated borrowings, 1.2% in 2016 and 2015, due 2021 — 200 Capital leases with terms expiring through 2018 at 1.6% to 5.4% in 2016 and 2015 748 1,771 Other — 6 Total debt and capital leases 700,290 744,014 Less current maturities: Long-term debt — (8,049 ) Capital leases (732 ) (74 ) Other — (6 ) Total current maturities (732 ) (8,129 ) Long-term debt and capital leases, less current maturities $ 699,558 $ 735,885 |
Future Minimum Payments Under Capital Leases | Future minimum lease payments under capital leases for the next five years and thereafter in total are as follows: (in thousands) 2017 $ 775 2018 25 2019 — 2020 — 2021 — After 2021 — Total future minimum lease payments 800 Less amount representing interest (52 ) Amount recognized as capital lease obligations $ 748 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Before Income Taxes | ncome before income taxes consisted of the following for the years ended June 30: (in thousands) 2016 2015 2014 (Loss) income before income taxes: United States $ (228,667 ) $ (323,299 ) $ 59,160 International 30,096 (64,316 ) 169,649 Total (loss) income before income taxes $ (198,571 ) $ (387,615 ) $ 228,809 Current income taxes: Federal $ (15,039 ) $ (9,328 ) $ 15,108 State 454 816 896 International 31,570 40,433 27,488 Total current income taxes 16,985 31,921 43,492 Deferred income taxes: Federal $ 6,786 $ (38,943 ) $ 10,157 State 8,407 (8,680 ) (62 ) International (6,865 ) (952 ) 13,024 Total deferred income taxes: 8,328 (48,575 ) 23,119 Provision (benefit) for income taxes $ 25,313 $ (16,654 ) $ 66,611 Effective tax rate (12.7 )% 4.3 % 29.1 % |
Reconciliation of Income Taxes and the Provision for Income Taxes | The reconciliation of income taxes computed using the statutory U.S. income tax rate and the provision for income taxes was as follows for the years ended June 30: (in thousands) 2016 2015 2014 Income taxes at U.S. statutory rate $ (69,500 ) $ (135,665 ) $ 80,083 State income taxes, net of federal tax benefits 859 (1,748 ) 1,593 U.S. income taxes provided on international income 2,364 3,679 2,423 Combined tax effects of international income (25,469 ) (21,560 ) (22,580 ) Impact of goodwill impairment charges 6,439 134,657 — Impact of divestiture 27,790 — — Change in valuation allowance and other uncertain tax positions 84,530 1,530 (2,603 ) Impact of domestic production activities deduction (2,072 ) — (942 ) Research and development credit (4,351 ) (3,087 ) (1,385 ) Change in permanent reinvestment assertion 3,659 2,945 7,170 Other 1,064 2,595 2,852 Provision (benefit) for income taxes $ 25,313 $ (16,654 ) $ 66,611 |
Components of Net Deferred Tax Liabilities and Assets | The components of net deferred tax assets and (liabilities) were as follows at June 30: (in thousands) 2016 2015 Deferred tax assets: Net operating loss carryforwards $ 77,198 $ 47,289 Inventory valuation and reserves 18,865 18,023 Pension benefits 42,432 23,559 Other postretirement benefits 7,111 7,359 Accrued employee benefits 17,069 23,674 Other accrued liabilities 9,229 18,210 Hedging activities 5,507 4,354 Tax credits and other carryforwards 30,733 13,815 Intangible assets 21,575 — Other — 12,028 Total 229,719 168,311 Valuation allowance (122,699 ) (16,771 ) Total deferred tax assets $ 107,020 $ 151,540 Deferred tax liabilities: Tax depreciation in excess of book $ 83,412 $ 102,480 Intangible assets — 18,688 Other 149 — Total deferred tax liabilities $ 83,561 $ 121,168 Total net deferred tax assets (liabilities) $ 23,459 $ 30,372 |
Reconciliation of Unrecognized Tax Benefits Excluding Interest | A reconciliation of the beginning and ending amount of unrecognized tax benefits (excluding interest) is as follows as of June 30: (in thousands) 2016 2015 2014 Balance at beginning of year $ 14,619 $ 20,366 $ 26,798 Increases for tax positions of prior years 1,197 — 1,461 Decreases for tax positions of prior years — (3,188 ) (6,982 ) Increases for tax positions related to the current year — — 116 Decreases related to settlement with taxing authority (11,942 ) (348 ) (2,161 ) Decreases related to lapse of statute of limitations (667 ) (398 ) — Foreign currency translation (101 ) (1,813 ) 1,134 Balance at end of year $ 3,106 $ 14,619 $ 20,366 |
Pension and Other Postretirem40
Pension and Other Postretirement Benefits (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Funded Status of Pension Plans and Amount recognized in the Consolidated Balance Sheet | The funded status of our pension plans and amounts recognized in the consolidated balance sheets as of June 30 were as follows: (in thousands) 2016 2015 Change in benefit obligation: Benefit obligation, beginning of year $ 954,454 $ 969,904 Service cost 4,640 5,474 Interest cost 37,726 39,007 Participant contributions 6 12 Actuarial losses 86,425 50,464 Benefits and expenses paid (45,074 ) (73,897 ) Currency translation adjustments (19,283 ) (36,377 ) Plan amendments 696 — Special termination benefits 334 459 Plan settlements (7,991 ) — Plan curtailments (6,565 ) (592 ) Benefit obligation, end of year $ 1,005,368 $ 954,454 Change in plans' assets: Fair value of plans' assets, beginning of year $ 827,337 $ 884,264 Actual return on plans' assets 50,637 20,007 Company contributions 15,876 8,703 Participant contributions 6 12 Plan settlements (7,991 ) — Benefits and expenses paid (45,074 ) (73,897 ) Currency translation adjustments (19,116 ) (11,752 ) Fair value of plans' assets, end of year $ 821,675 $ 827,337 Funded status of plans $ (183,693 ) $ (127,117 ) Amounts recognized in the balance sheet consist of: Long-term prepaid benefit $ 8,941 $ 31,274 Short-term accrued benefit obligation (10,037 ) (14,592 ) Accrued pension benefits (182,597 ) (143,799 ) Net amount recognized $ (183,693 ) $ (127,117 ) |
Defined Benefit Pension Plans Recognized in Accumulated Other Comprehensive (Loss) Income | The pre-tax amounts related to our other postretirement benefit plans which were recognized in accumulated other comprehensive (loss) income were as follows at June 30: (in thousands) 2016 2015 Unrecognized net actuarial losses $ 6,368 $ 5,969 Unrecognized net prior service credits (150 ) (172 ) Total $ 6,218 $ 5,797 The pre-tax amounts related to our defined benefit pension plans recognized in accumulated other comprehensive (loss) income were as follows at June 30: (in thousands) 2016 2015 Unrecognized net actuarial losses $ 272,802 $ 196,567 Unrecognized net prior service credits 155 (953 ) Unrecognized transition obligations 740 651 Total $ 273,697 $ 196,265 |
Accumulated Benefit Obligations Exceeding Plan Assets Fair Value | Included in the above information are plans with accumulated benefit obligations exceeding the fair value of plan assets as of June 30 as follows: (in thousands) 2016 2015 Projected benefit obligation $ 877,146 $ 165,281 Accumulated benefit obligation 875,233 164,913 Fair value of plan assets 684,512 7,394 |
Net Periodic Pension (Income) Cost | The components of net periodic pension income include the following as of June 30: (in thousands) 2016 2015 2014 Service cost $ 4,640 $ 5,474 $ 6,910 Interest cost 37,726 39,007 41,084 Expected return on plans' assets (58,523 ) (59,698 ) (59,527 ) Amortization of transition obligation 80 78 78 Amortization of prior service cost (417 ) (361 ) (234 ) Special termination benefit charge 334 459 — Curtailment loss — 358 — Settlement loss 227 261 — Recognition of actuarial losses 7,286 3,671 2,642 Net periodic pension income $ (8,647 ) $ (10,751 ) $ (9,047 ) |
Funded Status of Other Postretirement Benefit Plans and Amount Recognized in the Consolidated Balance Sheet | The funded status of our other postretirement benefit plans and the related amounts recognized in the consolidated balance sheets were as follows: (in thousands) 2016 2015 Change in benefit obligation: Benefit obligation, beginning of year $ 21,205 $ 24,476 Service cost — 45 Interest cost 840 934 Actuarial losses 722 1,489 Benefits paid (2,225 ) (2,155 ) Curtailments — (3,584 ) Benefit obligation, end of year $ 20,542 $ 21,205 Funded status of plan $ (20,542 ) $ (21,205 ) Amounts recognized in the balance sheet consist of: Short-term accrued benefit obligation $ (1,666 ) $ (1,975 ) Accrued postretirement benefits (18,876 ) (19,230 ) Net amount recognized $ (20,542 ) $ (21,205 ) |
Net Periodic Other Postretirement Costs (Benefit) | (in thousands) 2016 2015 2014 Service cost $ — $ 45 $ 55 Interest cost 840 934 1,006 Amortization of prior service credit (22 ) (59 ) (111 ) Recognition of actuarial loss 324 492 317 Curtailment gain — (221 ) — Net periodic other postretirement benefit cost $ 1,142 $ 1,191 $ 1,267 |
Significant Actuarial Assumptions Used to Determine the Present Value of Net Benefit Obligations | The significant actuarial assumptions used to determine the present value of net benefit obligations for our defined benefit pension plans and other postretirement benefit plans were as follows: 2016 2015 2014 Discount Rate: U.S. plans 2.4-3.7% 3.2-4.5% 4.4 % International plans 0.9-3.2% 2.3-3.8% 2.9-4.3% Rates of future salary increases: U.S. plans 3.0-4.0% 3.0-4.0% 3.0-5.0% International plans 2.5-3.0% 2.5-3.0% 2.5-3.0% The significant assumptions used to determine the net periodic (income) cost for our pension and other postretirement benefit plans were as follows: 2016 2015 2014 Discount Rate: U.S. plans 3.2-4.5% 4.4 % 4.9 % International plans 2.3-3.8% 2.9-4.3% 3.5-4.8% Rates of future salary increases: U.S. plans 3.0-4.0% 3.0-5.0% 3.0-5.0% International plans 2.5-3.0% 2.5-3.0% 2.5-3.0% Rate of return on plans assets: U.S. plans 7.5 % 7.5 % 8.0 % International plans 5.3-5.5% 5.0-6.0% 5.0 % |
Annual Assumed Rate of Increase in Per Capita Cost of Covered Benefits for Postretirement Benefit Plans | The annual assumed rate of increase in the per capita cost of covered benefits (the health care cost trend rate) for our postretirement benefit plans was as follows: 2016 2015 2014 Health care costs trend rate assumed for next year 8.5 % 7.3 % 7.5 % Rate to which the cost trend rate gradually declines 5.0 % 5.0 % 5.0 % Year that the rate reaches the rate at which it is assumed to remain 2027 2024 2024 |
Calculated Effect of Change on Assumption Used to Calculate Interest Cost Components and Obligations of Healthcare Plans | A change of one percentage point in the assumed health care cost trend rates would have the following effects on the total service and interest cost components of our other postretirement cost and other postretirement benefit obligation at June 30, 2016: (in thousands) 1% Increase 1% Decrease Effect on total service and interest cost components $ 37 $ (33 ) Effect on other postretirement obligation 864 (776 ) |
Asset Allocations and Target Allocations by Asset Class | Our defined benefit pension plans’ asset allocations as of June 30, 2016 and 2015 and target allocations for 2017, by asset class, were as follows: 2016 2015 Target % Equity 23 % 32 % 22.5 % Fixed Income 67 % 65 % 70.0 % Other 10 % 3 % 7.5 % |
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Table Text Block] | The following table presents the fair value of the benefit plan assets classified under the appropriate level of the fair value hierarchy as of June 30, 2016: (in thousands) Level 1 Level 2 Level 3 Total Corporate fixed income securities $ — $ 395,102 $ — $ 395,102 Common / collective trusts: Value funds — 68,731 — 68,731 Growth funds — 38,126 — 38,126 Balanced funds — 8,581 — 8,581 Common stock 74,163 — — 74,163 Government securities: U.S. government securities — 79,275 — 79,275 Foreign government securities — 43,729 — 43,729 Other fixed income securities — 31,503 — 31,503 Other 3,029 79,436 — 82,465 Total investments $ 77,192 $ 744,483 $ — $ 821,675 The following table presents the fair value of the benefit plan assets classified under the appropriate level of the fair value hierarchy as of June 30, 2015: (in thousands) Level 1 Level 2 Level 3 Total Corporate fixed income securities $ — $ 391,275 $ — $ 391,275 Common / collective trusts: Value funds — 102,466 — 102,466 Growth funds — 54,179 — 54,179 Balanced funds — 10,090 — 10,090 Common stock 94,964 — — 94,964 Government securities: U.S. government securities — 68,628 — 68,628 Foreign government securities — 44,474 — 44,474 Other fixed income securities — 32,540 — 32,540 Other 3,396 25,325 — 28,721 Total investments $ 98,360 $ 728,977 $ — $ 827,337 |
Accumulated Other Comprehensi41
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Components of Accumulated Other Comprehensive I(Loss) Income [Table Text Block] | The components of and changes in AOCL were as follows (net of tax) for the year ended June 30, 2016 (in thousands): Attributable to Kennametal: Post-retirement benefit plans Currency translation adjustment Derivatives Total Balance, June 30, 2015 $ (138,793 ) $ (97,309 ) $ (7,421 ) $ (243,523 ) Other comprehensive (loss) income before reclassifications (78,295 ) (51,508 ) (150 ) (129,953 ) Amounts Reclassified from AOCL 4,925 15,088 (1,563 ) 18,450 Net current period other comprehensive loss (73,370 ) (36,420 ) (1,713 ) (111,503 ) Sale of subsidiary stock to noncontrolling interest — 2,517 — 2,517 AOCL, June 30, 2016 $ (212,163 ) $ (131,212 ) $ (9,134 ) $ (352,509 ) Attributable to noncontrolling interests: Balance, June 30, 2015 $ — $ (2,258 ) $ — $ (2,258 ) Other comprehensive loss before reclassifications — (1,188 ) — (1,188 ) Net current period other comprehensive loss — (1,188 ) — (1,188 ) AOCL, June 30, 2016 $ — $ (3,446 ) $ — $ (3,446 ) The components of and changes in AOCL were as follows (net of tax) for the year ended June 30, 2015 (in thousands): Attributable to Kennametal: Post-retirement benefit plans Currency translation adjustment Derivatives Total Balance, June 30, 2014 $ (93,742 ) $ 38,811 $ (11,200 ) $ (66,131 ) Other comprehensive (loss) income before reclassifications (47,982 ) (136,120 ) 6,652 (177,450 ) Amounts Reclassified from AOCL 2,931 — (2,873 ) 58 Net current period other comprehensive loss (45,051 ) (136,120 ) 3,779 (177,392 ) AOCL, June 30, 2015 $ (138,793 ) $ (97,309 ) $ (7,421 ) $ (243,523 ) Attributable to noncontrolling interests: Balance, June 30, 2014 $ — $ 1,087 $ — $ 1,087 Other comprehensive income before reclassifications — (3,345 ) — (3,345 ) Net current period other comprehensive loss — (3,345 ) — (3,345 ) AOCL, June 30, 2015 $ — $ (2,258 ) $ — $ (2,258 ) The components of and changes in AOCL were as follows (net of tax) for the year ended June 30, 2014 (in thousands): Attributable to Kennametal: Post-retirement benefit plans Currency translation adjustment Derivatives Total Balance, June 30, 2013 $ (83,936 ) $ 7,413 $ (12,481 ) $ (89,004 ) Other comprehensive income (loss) before reclassifications (11,990 ) 31,398 (706 ) 18,702 Amounts Reclassified from AOCL 2,184 — 1,987 4,171 Net current period other comprehensive loss (9,806 ) 31,398 1,281 22,873 AOCL, June 30, 2014 $ (93,742 ) $ 38,811 $ (11,200 ) $ (66,131 ) Attributable to noncontrolling interests: Balance, June 30, 2013 $ — $ 721 $ — $ 721 Other comprehensive loss before — 366 — 366 Net current period other comprehensive loss — 366 — 366 AOCL, June 30, 2014 $ — $ 1,087 $ — $ 1,087 |
Reclassification out of Accumulated Other Comprehensive Loss | Reclassifications out of AOCL for the years ended June 30, 2016 , 2015 and 2014 consisted of the following: Year Ended June 30, Details about AOCL components 2016 2015 2014 Affected line item in the Income Statement Gains and losses on cash flow hedges: Forward starting interest rate swaps $ 2,099 $ 2,021 $ 1,945 Interest expense Currency exchange contracts (4,645 ) (6,700 ) 1,260 Other (income) expense, net Total before tax (2,546 ) (4,679 ) 3,205 Tax expense (benefit) 983 1,806 (1,218 ) Provision (benefit) for income taxes Net of tax $ (1,563 ) $ (2,873 ) $ 1,987 Post-retirement benefit plans: Amortization of transition obligations $ 80 $ 78 $ 78 See Note 13 for further details Amortization of prior service credit (439 ) (420 ) (345 ) See Note 13 for further details Recognition of actuarial losses 7,610 4,163 2,959 See Note 13 for further details Total before tax 7,251 3,821 2,692 Tax (benefit) (2,326 ) (890 ) (508 ) Provision (benefit) for income taxes Net of tax $ 4,925 $ 2,931 $ 2,184 Foreign currency translation adjustments: Released due to divestiture 15,088 — — Loss on divestiture Total before taxes 15,088 — — Tax benefit — — — Provision (benefit) for income taxes Net of tax $ 15,088 $ — $ — |
Amount of Income Tax (Expense) Benefit Allocated to Each Component of Other Comprehensive Income (Loss) [Table Text Block] | The amount of income tax allocated to each component of other comprehensive (loss) for the year ended June 30, 2016 : (in thousands) Pre-tax Tax impact Net of tax Unrealized loss on derivatives designated and qualified as cash flow hedges $ (244 ) $ 94 $ (150 ) Reclassification of unrealized gain on expired derivatives designated and qualified as cash flow hedges (2,546 ) 983 (1,563 ) Unrecognized net pension and other postretirement benefit loss (84,266 ) 5,971 (78,295 ) Reclassification of net pension and other postretirement benefit loss 7,251 (2,326 ) 4,925 Foreign currency translation adjustments (52,699 ) 4 (52,695 ) Reclassification of foreign currency translation adjustment loss realized upon sale 15,088 — 15,088 Other comprehensive (loss) $ (117,416 ) $ 4,726 $ (112,690 ) The amount of income tax allocated to each component of other comprehensive (loss) for the year ended June 30, 2015 : (in thousands) Pre-tax Tax impact Net of tax Unrealized gain on derivatives designated and qualified as cash flow hedges $ 10,834 $ (4,182 ) $ 6,652 Reclassification of unrealized gain on expired derivatives designated and qualified as cash flow hedges (4,679 ) 1,806 (2,873 ) Unrecognized net pension and other postretirement benefit loss (76,029 ) 28,047 (47,982 ) Reclassification of net pension and other postretirement benefit loss 3,821 (890 ) 2,931 Foreign currency translation adjustments (147,172 ) 7,707 (139,465 ) Other comprehensive (loss) $ (213,225 ) $ 32,488 $ (180,737 ) The amount of income tax allocated to each component of other comprehensive income for the year ended June 30, 2014 : (in thousands) Pre-tax Tax impact Net of tax Unrealized loss on derivatives designated and qualified as cash flow hedges (1,139 ) 433 (706 ) Reclassification of unrealized loss on expired derivatives designated and qualified as cash flow hedges 3,205 (1,218 ) 1,987 Unrecognized net pension and other postretirement benefit loss (15,900 ) 3,910 (11,990 ) Reclassification of net pension and other postretirement benefit loss 2,692 (508 ) 2,184 Foreign currency translation adjustments 33,493 (1,730 ) 31,763 Other comprehensive income 22,351 887 23,238 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Restructuring Charges [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost | The restructuring accrual is recorded in other current liabilities in our consolidated balance sheet and the amount attributable to each segment is as follows: (in thousands) June 30, 2015 Expense Asset Write-Down Other (2) Translation Cash Expenditures June 30, 2016 Industrial Severance $ 13,456 $ 17,322 $ — $ (347 ) $ (140 ) $ (21,202 ) $ 9,089 Facilities — 330 (780 ) — — 450 — Other 28 297 — — (5 ) 579 899 Total Industrial $ 13,484 $ 17,949 $ (780 ) $ (347 ) $ (145 ) $ (20,173 ) $ 9,988 Infrastructure Severance $ 7,173 $ 7,424 $ — $ (201 ) $ (60 ) $ (9,035 ) $ 5,301 Facilities 131 4,515 (3,914 ) — — (699 ) 33 Other — 127 — — (2 ) 256 381 Total Infrastructure 7,304 12,066 (3,914 ) (201 ) (62 ) (9,478 ) 5,715 Total $ 20,788 $ 30,015 $ (4,694 ) $ (548 ) $ (207 ) $ (29,651 ) $ 15,703 (2) Special termination benefit charge and settlement charge for one of our U.S.-based benefit pension plans resulting from executive retirement - see Note 13. (in thousands) June 30, 2014 Expense Asset Write-Down Other (3) Translation Cash Expenditures June 30, 2015 Industrial Severance $ 5,815 $ 20,713 $ — $ — $ (328 ) $ (12,744 ) $ 13,456 Facilities 444 2,277 (2,231 ) — (15 ) (475 ) — Other 67 77 — — (2 ) (114 ) 28 Total Industrial $ 6,326 $ 23,067 $ (2,231 ) $ — $ (345 ) $ (13,333 ) $ 13,484 Infrastructure Severance $ 2,458 $ 14,027 $ — $ (459 ) $ (223 ) $ (8,630 ) $ 7,173 Facilities 190 4,969 (3,638 ) — (32 ) (1,358 ) 131 Other 28 — — — (3 ) (25 ) — Total Infrastructure 2,676 18,996 (3,638 ) (459 ) (258 ) (10,013 ) 7,304 Total $ 9,002 $ 42,063 $ (5,869 ) $ (459 ) $ (603 ) $ (23,346 ) $ 20,788 (3) Special termination benefit charge for one of our U.S.-based benefit pension plans resulting from a plant closure - see Note 13. Asset impairment Charges See discussion on goodwill and other intangible asset impairment charges in Note 2. During 2016, we identified specific machinery and equipment that was no longer being utilized in the manufacturing organization of which we disposed by abandonment. As a result of this review, we recorded property, plant, and equipment impairment charges of $5.4 million during 2016, which has been presented in restructuring and asset impairment charges in our consolidated statement of income. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
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 2016 , 2015 and 2014 were as follows: 2016 2015 2014 Risk-free interest rate 1.4 % 1.5 % 1.3 % Expected life (years) (4) 4.5 4.5 4.5 Expected volatility (5) 31.7 % 32.5 % 40.3 % Expected dividend yield 2.1 % 1.7 % 1.7 % (4) Expected life is derived from historical experience. (5) Expected volatility is based on the implied historical volatility of our stock. |
Changes in stock options | Changes in our stock options for 2016 were as follows: Options Weighted Average Exercise Price Weighted Average Remaining Life (years) Aggregate Intrinsic value (in thousands) Options outstanding, June 30, 2015 2,094,037 $ 36.08 Granted 885,403 28.29 Exercised (39,177 ) 24.96 Lapsed and forfeited (392,454 ) 34.93 Options outstanding, June 30, 2016 2,547,809 $ 33.72 4.9 $ 602 Options vested and expected to vest, June 30, 2016 2,501,094 $ 33.79 4.8 $ 589 Options exercisable, June 30, 2016 1,625,728 $ 35.38 2.7 $ 89 |
Changes in time vesting and performance vesting restricted stock units | Changes in our time vesting and performance vesting restricted stock units for 2016 were as follows: Performance Vesting Stock Units Performance Vesting Weighted Average Fair Value Time Vesting Stock Units Time Vesting Weighted Average Fair Value Unvested performance vesting and time vesting restricted stock units, June 30, 2015 101,245 $ 43.00 689,268 $ 41.53 Granted 117,589 31.60 760,443 27.46 Vested — — (300,191 ) 40.68 Performance metric not achieved (42,697 ) 31.60 — — Forfeited (60,670 ) 32.70 (134,776 ) 35.80 Unvested performance vesting and time vesting restricted stock units, June 30, 2016 115,467 $ 36.96 1,014,744 $ 31.97 |
Segment Data (Tables)
Segment Data (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Segment Reporting [Abstract] | |
Segment Data | Segment data is summarized as follows: (in thousands) 2016 2015 2014 Sales: Industrial $ 1,269,162 $ 1,461,744 $ 1,524,075 Infrastructure 829,274 1,185,451 1,313,115 Total sales $ 2,098,436 $ 2,647,195 $ 2,837,190 Operating (loss) income: Industrial $ 81,243 $ 160,894 $ 177,040 Infrastructure (246,306 ) (509,381 ) 94,940 Corporate (9,880 ) (9,336 ) (8,548 ) Total operating (loss) income $ (174,943 ) $ (357,823 ) $ 263,432 Interest expense $ 27,752 $ 31,466 $ 32,451 Other (income) expense, net (4,124 ) (1,674 ) 2,172 (Loss) income before income taxes $ (198,571 ) $ (387,615 ) $ 228,809 Depreciation and amortization: Industrial $ 62,942 $ 64,188 $ 65,820 Infrastructure 54,459 67,413 64,339 Corporate 65 63 63 Total depreciation and amortization $ 117,466 $ 131,664 $ 130,222 Equity income: Industrial $ — $ — $ 34 Infrastructure (10 ) 6 50 Total equity income $ (10 ) $ 6 $ 84 Total assets: Industrial $ 1,215,226 $ 1,259,270 $ 1,449,688 Infrastructure 849,447 1,279,608 1,986,724 Corporate 304,120 310,651 431,674 Total assets $ 2,368,793 $ 2,849,529 $ 3,868,086 Capital expenditures: Industrial $ 80,560 $ 64,497 $ 71,628 Infrastructure 30,137 36,442 45,748 Total capital expenditures $ 110,697 $ 100,939 $ 117,376 Investments in affiliated companies: Industrial $ — $ — $ — Infrastructure 2 361 495 Total investments in affiliated companies $ 2 $ 361 $ 495 |
Geographic Information for Sales [Table Text Block] | Geographic information for sales, based on country of origin, and assets is as follows: (in thousands) 2016 2015 2014 Sales: United States $ 897,399 $ 1,176,622 $ 1,198,541 Germany 334,366 442,009 511,209 China 210,124 246,953 248,212 India 77,934 85,193 81,455 Italy 69,821 85,530 107,511 France 56,264 59,772 63,473 Canada 55,812 73,912 78,163 United Kingdom 50,723 70,600 105,041 Other 345,993 406,604 443,585 Total sales $ 2,098,436 $ 2,647,195 $ 2,837,190 Total assets: United States $ 1,075,330 $ 1,338,594 $ 1,842,453 Germany 327,679 394,491 538,661 China 233,200 274,774 341,949 Switzerland 189,498 194,139 264,928 India 91,544 97,463 94,897 Canada 57,174 60,492 133,481 Italy 50,352 94,978 178,141 United Kingdom 48,507 71,342 79,657 Other 295,509 323,256 393,919 Total assets: $ 2,368,793 $ 2,849,529 $ 3,868,086 |
Revenue from External Customers by Products and Services [Table Text Block] | Approximate sales by end markets as a percentage of consolidated sales are as follows: 2016 2015 2014 End markets: General engineering 38 % 36 % 31 % Transportation 21 21 21 Energy 17 19 23 Earthworks 16 17 19 Aerospace and defense 8 7 6 Total 100 % 100 % 100 % |
Selected Quarterly Financial 45
Selected Quarterly Financial Data (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Quarterly Financial Data [Abstract] | |
Selected Quarterly Financials Data [Table Text Block] | SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) For the quarter ended (in thousands, except per share data) September 30 December 31 March 31 June 30 2016 Sales $ 555,354 $ 524,021 $ 497,837 $ 521,224 Gross profit 151,224 140,806 157,353 166,684 Net (loss) income attributable to Kennametal (6,226 ) (169,227 ) 16,000 (66,515 ) Basic (loss) earnings per share attributable to Kennametal (6) Net income (0.08 ) (2.12 ) 0.20 (0.83 ) Diluted (loss) earnings per share attributable to Kennametal (6) Net income (0.08 ) (2.12 ) 0.20 (0.83 ) 2015 Sales $ 694,941 $ 675,631 $ 638,970 $ 637,653 Gross profit 218,009 199,458 199,470 188,966 Net income (loss) attributable to Kennametal 39,489 (388,302 ) (46,229 ) 21,146 Basic earnings (loss) per share attributable to Kennametal (6) Net income 0.50 (4.89 ) (0.58 ) 0.27 Diluted earnings (loss) per share attributable to Kennametal (6) Net income 0.49 (4.89 ) (0.58 ) 0.26 (6) Earnings per share amounts attributable to Kennametal for each quarter are computed using the weighted average number of shares outstanding during the quarter. Earnings per share amounts attributable to Kennametal for the full year are computed using the weighted average number of shares outstanding during the year. Thus, the sum of the four quarters’ earnings per share attributable to Kennametal does not always equal the full-year earnings per share attributable to Kennametal. |
Summary of Significant Accoun46
Summary of Significant Accounting Policies - Goodwill (Details) - USD ($) $ in Thousands | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Mar. 31, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Goodwill, Written off Related to Sale of Business Unit | $ (7,536) | ||||
Goodwill, Gross | 1,082,540 | $ 1,095,731 | $ 1,126,418 | ||
Goodwill, Accumulated Impairment Loss | (784,053) | (678,342) | (150,842) | ||
Goodwill | 298,487 | 417,389 | 975,576 | ||
Goodwill, Acquired During Period | 2,984 | 246,600 | |||
Goodwill, Translation Adjustments | (5,655) | (33,671) | |||
Goodwill, Period Increase (Decrease) | (13,191) | (30,687) | |||
Goodwill, Impairment Loss | 105,711 | ||||
Industrial [Member] | |||||
Goodwill, Written off Related to Sale of Business Unit | (1,075) | ||||
Goodwill, Gross | 449,329 | 455,371 | 472,337 | ||
Goodwill, Accumulated Impairment Loss | (150,842) | (150,842) | (150,842) | ||
Goodwill | 298,500 | 304,529 | 321,495 | ||
Goodwill, Acquired During Period | 2,984 | ||||
Goodwill, Translation Adjustments | (4,967) | (19,950) | |||
Goodwill, Period Increase (Decrease) | (6,042) | (16,966) | |||
Goodwill, Impairment Loss | 0 | ||||
Infrastructure [Member] | |||||
Goodwill, Written off Related to Sale of Business Unit | (6,461) | ||||
Goodwill and Intangible Asset Impairment | $ 106,100 | ||||
Goodwill, Gross | 633,211 | 640,360 | 654,081 | ||
Goodwill, Accumulated Impairment Loss | (633,211) | (527,500) | 0 | ||
Goodwill | 0 | 112,860 | $ 654,081 | ||
Goodwill, Acquired During Period | 0 | ||||
Goodwill, Translation Adjustments | (688) | (13,721) | |||
Goodwill, Period Increase (Decrease) | (7,149) | $ (13,721) | |||
Goodwill, Impairment Loss | (105,700) | $ 105,711 | |||
Infrastructure [Member] | Portfolio of Businesses for Strategic Alternatives [Member] | |||||
Net Book Value | $ 30,000 | ||||
March Charges [Member] | Infrastructure [Member] | |||||
Goodwill and Intangible Asset Impairment | 152,900 | ||||
Goodwill, Impairment Loss | (152,500) | ||||
December Charges [Member] | Infrastructure [Member] | |||||
Goodwill and Intangible Asset Impairment | 376,500 | ||||
Goodwill, Impairment Loss | (375,000) | ||||
Trademarks [Member] | Industrial [Member] | |||||
Impairment of Intangible Assets (Excluding Goodwill) | 2,300 | ||||
Trademarks [Member] | Infrastructure [Member] | |||||
Impairment of Intangible Assets (Excluding Goodwill) | $ 400 | ||||
Trademarks [Member] | March Charges [Member] | Infrastructure [Member] | |||||
Impairment of Intangible Assets (Excluding Goodwill) | 400 | ||||
Trademarks [Member] | Charge Associated with Finalization [Member] | Infrastructure [Member] | |||||
Impairment of Intangible Assets (Excluding Goodwill) | 6,800 | ||||
Trademarks [Member] | December Charges [Member] | Infrastructure [Member] | |||||
Impairment of Intangible Assets (Excluding Goodwill) | $ 1,500 |
Summary of Significant Accoun47
Summary of Significant Accounting Policies (Details 1) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Accumulated Amortization | $ (114,093) | $ (153,370) |
Contractual Rights [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 7,152 | 8,523 |
Finite-Lived Intangible Assets, Accumulated Amortization | (6,886) | (6,990) |
Technology-Based and other [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 47,323 | 52,820 |
Finite-Lived Intangible Assets, Accumulated Amortization | (27,011) | (29,723) |
Customer-related [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 205,471 | 275,796 |
Finite-Lived Intangible Assets, Accumulated Amortization | (66,938) | (90,141) |
Unpatented Technology [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 31,837 | 59,449 |
Finite-Lived Intangible Assets, Accumulated Amortization | (4,614) | (14,426) |
Trademarks [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 12,668 | 18,575 |
Finite-Lived Intangible Assets, Accumulated Amortization | (8,644) | (12,090) |
Trademarks [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets (Excluding Goodwill) | $ 16,850 | $ 24,876 |
Minimum [Member] | Contractual Rights [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 3 years | |
Minimum [Member] | Technology-Based and other [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 4 years | |
Minimum [Member] | Customer-related [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 10 years | |
Minimum [Member] | Unpatented Technology [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 10 years | |
Minimum [Member] | Trademarks [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 5 years | |
Maximum [Member] | Contractual Rights [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 15 years | |
Maximum [Member] | Technology-Based and other [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 20 years | |
Maximum [Member] | Customer-related [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 21 years | |
Maximum [Member] | Unpatented Technology [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 30 years | |
Maximum [Member] | Trademarks [Member] | ||
Finite Lived And Indefinite Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 20 years |
Summary Of Significant Accoun48
Summary Of Significant Accounting Policies (Details 2) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Accumulated Amortization | $ 114,093 | $ 153,370 |
Contractual Rights [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 7,152 | 8,523 |
Finite-Lived Intangible Assets, Accumulated Amortization | 6,886 | 6,990 |
Technology-Based and other [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 47,323 | 52,820 |
Finite-Lived Intangible Assets, Accumulated Amortization | 27,011 | 29,723 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 205,471 | 275,796 |
Finite-Lived Intangible Assets, Accumulated Amortization | 66,938 | 90,141 |
Unpatented Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 31,837 | 59,449 |
Finite-Lived Intangible Assets, Accumulated Amortization | 4,614 | 14,426 |
Trademarks [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 12,668 | 18,575 |
Finite-Lived Intangible Assets, Accumulated Amortization | 8,644 | 12,090 |
Trademarks [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets (Excluding Goodwill) | $ 16,850 | $ 24,876 |
Summary Of Significant Accoun49
Summary Of Significant Accounting Policies - Stock-Based Compensation (Details) - shares | 12 Months Ended | |
Jun. 30, 2016 | Oct. 26, 2010 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercisable Period for Capital Stock Options | 10 years | |
Amended and Restated Two Thousand Ten Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 9,500,000 |
Summary Of Significant Accoun50
Summary Of Significant Accounting Policies - Property, Plant and Equipment (Details) - USD ($) $ in Thousands, shares in Millions | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Property, Plant and Equipment [Line Items] | |||
Conditions for Investments in Entities Accounted for Equity Basis | 0.50 | ||
Conditions for Investments in Entities Accounted for on Cost Basis | 0.50 | ||
Excess and obsolete inventory reserve | $ 36,700 | $ 45,000 | |
Amortization | 20,762 | $ 26,686 | $ 26,195 |
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months | 15,800 | ||
Finite-Lived Intangible Assets, Amortization Expense, Year Two | 14,300 | ||
Finite-Lived Intangible Assets, Amortization Expense, Year Three | 13,900 | ||
Finite-Lived Intangible Assets, Amortization Expense, Year Four | 13,700 | ||
Finite-Lived Intangible Assets, Amortization Expense, Year Five | $ 13,300 | ||
Increase in weighted average shares due to dilutive effect of unexercised capital stock options, unvested restricted stock awards and unvested restricted stock units | 1 | ||
Unexercised capital stock options, restricted stock units and restricted stock awards excluded from computation of diluted EPS | 0.3 | ||
Conditions of Shipment are Considered to Have Occurred Unless Written Notice of Objection is Received | 10 | ||
Termination of Warranty | 30 | ||
Research and Development Expense | $ 39,400 | $ 45,100 | 44,000 |
Currency Transaction Gain (Loss), before Tax | $ 1,600 | $ 1,700 | $ (2,500) |
Minimum [Member] | Building and Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 15 years | ||
Minimum [Member] | Machinery and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 4 years | ||
Minimum [Member] | Furniture and Fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 5 years | ||
Minimum [Member] | ComputerHardwareAndSoftware [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Maximum [Member] | Building and Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 40 years | ||
Maximum [Member] | Machinery and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 15 years | ||
Maximum [Member] | Furniture and Fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 10 years | ||
Maximum [Member] | ComputerHardwareAndSoftware [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 5 years |
Summary of Signficant Accountin
Summary of Signficant Accounting Policies (Details Textual 1) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Business Acquisition [Line Items] | ||||
Goodwill | $ 298,487 | $ 417,389 | $ 975,576 | |
Goodwill, Written off Related to Sale of Business Unit | (7,536) | |||
Finite-Lived Intangible Assets, Accumulated Amortization | 114,093 | 153,370 | ||
Goodwill, Acquired During Period | 2,984 | 246,600 | ||
Goodwill Deductible For Tax Purposes | 202,100 | |||
Intangible Assets, Gross (Excluding Goodwill) | 321,301 | 440,039 | ||
Goodwill, Impairment Loss | (105,711) | |||
Contractual Rights [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Assets, Gross | 7,152 | 8,523 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | 6,886 | 6,990 | ||
Finite-lived Intangible Assets, Written off Related to Sale of Business Unit | $ 500 | |||
Contractual Rights [Member] | Maximum [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 15 years | |||
Contractual Rights [Member] | Minimum [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 3 years | |||
Technology-Based and other [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Assets, Gross | $ 47,323 | 52,820 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | 27,011 | 29,723 | ||
Finite-lived Intangible Assets, Written off Related to Sale of Business Unit | $ 800 | |||
Technology-Based and other [Member] | Maximum [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 20 years | |||
Technology-Based and other [Member] | Minimum [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 4 years | |||
Customer-related [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Assets, Gross | $ 205,471 | 275,796 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | 66,938 | 90,141 | ||
Finite-lived Intangible Assets, Written off Related to Sale of Business Unit | $ 30,000 | |||
Customer-related [Member] | Maximum [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 21 years | |||
Customer-related [Member] | Minimum [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 10 years | |||
Unpatented Technology [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Assets, Gross | $ 31,837 | 59,449 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | 4,614 | 14,426 | ||
Finite-lived Intangible Assets, Written off Related to Sale of Business Unit | $ 15,400 | |||
Unpatented Technology [Member] | Maximum [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 30 years | |||
Unpatented Technology [Member] | Minimum [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 10 years | |||
Trademarks [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Assets, Gross | $ 12,668 | 18,575 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | 8,644 | 12,090 | ||
Finite-lived Intangible Assets, Written off Related to Sale of Business Unit | $ 1,100 | |||
Trademarks [Member] | Maximum [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 20 years | |||
Trademarks [Member] | Minimum [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 5 years | |||
Trademarks [Member] | ||||
Business Acquisition [Line Items] | ||||
Indefinite-Lived Intangible Assets (Excluding Goodwill) | $ 16,850 | 24,876 | ||
Indefinite-lived Intangible Assets, Written off Related to Sale of Business Unit | 5,000 | |||
Infrastructure [Member] | ||||
Business Acquisition [Line Items] | ||||
Goodwill | 0 | 112,860 | 654,081 | |
Goodwill, Written off Related to Sale of Business Unit | (6,461) | |||
Goodwill, Acquired During Period | 0 | |||
Goodwill and Intangible Asset Impairment | $ 106,100 | |||
Goodwill, Impairment Loss | 105,700 | (105,711) | ||
Infrastructure [Member] | Contractual Rights [Member] | ||||
Business Acquisition [Line Items] | ||||
Intangible Asset Write-Down | 10,500 | |||
Impairment of Intangible Assets (Excluding Goodwill) | 5,500 | |||
Reduction of Liability | 5,000 | |||
Infrastructure [Member] | Trademarks [Member] | ||||
Business Acquisition [Line Items] | ||||
Impairment of Intangible Assets (Excluding Goodwill) | 400 | |||
Industrial [Member] | ||||
Business Acquisition [Line Items] | ||||
Goodwill | 298,500 | 304,529 | $ 321,495 | |
Goodwill, Written off Related to Sale of Business Unit | (1,075) | |||
Goodwill, Acquired During Period | $ 2,984 | |||
Goodwill, Impairment Loss | $ 0 | |||
Industrial [Member] | Trademarks [Member] | ||||
Business Acquisition [Line Items] | ||||
Impairment of Intangible Assets (Excluding Goodwill) | $ 2,300 |
Summary of Significant Accoun52
Summary of Significant Accounting Policies (Details Textual 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Goodwill, Acquired During Period | $ 2,984 | $ 246,600 | |
Goodwill Deductible For Tax Purposes | $ 202,100 | ||
Infrastructure [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Goodwill, Acquired During Period | 0 | ||
Industrial [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Goodwill, Acquired During Period | $ 2,984 | ||
Trademarks [Member] | Minimum [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 5 years | ||
Trademarks [Member] | Maximum [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 20 years | ||
Technology-Based and other [Member] | Minimum [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 4 years | ||
Technology-Based and other [Member] | Maximum [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 20 years | ||
Unpatented Technology [Member] | Minimum [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 10 years | ||
Unpatented Technology [Member] | Maximum [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 30 years |
Supplemental Cash Flow Inform53
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Supplemental Cash Flow Elements [Abstract] | |||
Interest | $ 26,250 | $ 30,984 | $ 29,836 |
Income taxes | 43,733 | 40,295 | 49,393 |
Change In Accounts Payable Related To Purchases Of Property, Plant And Equipment | $ 1,000 | $ (9,900) | $ 2,100 |
Acquisitions and Divestitures A
Acquisitions and Divestitures Acquisition - Purchase Price Allocation (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 |
Assets, Current [Abstract] | |||
Goodwill | $ 298,487 | $ 417,389 | $ 975,576 |
Acquisition - Unaudited Pro For
Acquisition - Unaudited Pro Forma Financial Information (Details) - TMB [Member] $ / shares in Units, $ in Thousands | 12 Months Ended |
Jun. 30, 2014USD ($)$ / shares | |
Pro forma operating results | |
Net Sales | $ | $ 2,941,005 |
Net income attributable to Kennametal | $ | $ 175,804 |
Per share data attributable to Kennametal Shareholders: | |
Basic earnings per share | $ / shares | $ 2.23 |
Diluted earnings per share | $ / shares | $ 2.21 |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Narrative (Details) - USD ($) $ in Thousands | 8 Months Ended | 12 Months Ended | |||||
Jun. 30, 2014 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | Nov. 30, 2015 | Nov. 04, 2013 | Aug. 01, 2013 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||
Proceeds from Divestiture of Businesses, Net of Cash Divested | $ 56,127 | $ 0 | $ 10,225 | ||||
Acquisitions (Textual) [Abstract] | |||||||
Goodwill | $ 975,576 | 298,487 | 417,389 | 975,576 | |||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 194,900 | ||||||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | (10,500) | ||||||
Restructuring and Related Pre-tax Costs | 53,500 | 58,100 | 19,086 | ||||
Payments to Acquire Businesses, Gross | 0 | 0 | 634,615 | ||||
Contingent Consideration | 6,600 | 10,000 | |||||
Goodwill, Acquired During Period | 2,984 | 246,600 | |||||
Loss on divestiture | (131,463) | $ 0 | 0 | ||||
TMB [Member] | |||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||
Business Combination, Consideration Transferred, Including Equity Interest in Acquiree Held Prior to Combination | $ 607,000 | ||||||
Acquisitions (Textual) [Abstract] | |||||||
Number of Employees | 1,175 | ||||||
Number of Primary Operating Facilities | 12 | ||||||
Acquisition Related Costs | $ 8,700 | 8,700 | |||||
Restructuring and Related Pre-tax Costs | 19,100 | ||||||
Emura [Member] | |||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||
Business Combination, Consideration Transferred, Including Equity Interest in Acquiree Held Prior to Combination | $ 40,100 | ||||||
Acquisitions (Textual) [Abstract] | |||||||
Payments to Acquire Businesses, Gross | 25,600 | 500 | |||||
Contingent Consideration | $ 14,000 | ||||||
Small Acquisition in Infrastructure Segment [Member] | |||||||
Acquisitions (Textual) [Abstract] | |||||||
Small Acquisition, Acquisition Cost | 2,000 | ||||||
Infrastructure [Member] | |||||||
Acquisitions (Textual) [Abstract] | |||||||
Goodwill | 654,081 | 0 | 112,860 | 654,081 | |||
Goodwill, Acquired During Period | 0 | ||||||
Loss on divestiture | (127,900) | ||||||
Industrial [Member] | |||||||
Acquisitions (Textual) [Abstract] | |||||||
Goodwill | $ 321,495 | 298,500 | 304,529 | $ 321,495 | |||
Goodwill, Acquired During Period | $ 2,984 | ||||||
Loss on divestiture | $ (3,600) | ||||||
Non-Core Businesses Sold to Madison Industries [Member] | |||||||
Acquisitions (Textual) [Abstract] | |||||||
Net Book Value | $ 191,900 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured on Recurring Basis (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivatives | [1] | $ 334 | $ 2,678 |
Total assets at fair value | 334 | 2,678 | |
Derivatives | [1] | 763 | 44 |
Contingent Consideration | 6,600 | 10,000 | |
Total liabilities at fair value | 7,363 | 10,044 | |
Contingent Consideration Paid | 3,400 | ||
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivatives | [1] | 334 | 2,678 |
Total assets at fair value | 334 | 2,678 | |
Derivatives | [1] | 763 | 44 |
Total liabilities at fair value | $ 763 | 44 | |
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 | 6 months | ||
Contingent Consideration | $ 6,600 | $ 10,000 | |
Total liabilities at fair value | $ 6,600 | ||
[1] | (in thousands)Level 1 Level 2 Level 3 TotalAssets: Derivatives (1)$— $2,678 $— $2,678Total assets at fair value$— $2,678 $— $2,678 Liabilities: Derivatives (1)$— $44 $— $44 Contingent consideration— — 10,000 10,000Total liabilities at fair value$— $44 $10,000 $10,044 (1) Currency derivatives are valued based on observable market spot and forward rates and are classified within Level 2 of the fair value hierarchy. |
Derivative Instruments and He58
Derivative Instruments and Hedging Activities - Fair Value of Derivatives Designated and Note Designated as Hedging Instruments (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Fair value of derivatives | ||
Total derivatives | $ (429) | $ 2,634 |
Designated as Hedging Instrument [Member] | ||
Fair value of derivatives | ||
Total derivatives | 323 | 2,626 |
Not Designated as Hedging Instrument [Member] | ||
Fair value of derivatives | ||
Total derivatives | (752) | 8 |
Range Forward Contracts [Member] | Designated as Hedging Instrument [Member] | Other Current Assets [Member] | ||
Fair value of derivatives | ||
Derivative assets designated as hedging instruments | 323 | 2,626 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Other Current Assets [Member] | ||
Fair value of derivatives | ||
Derivative assets designated as hedging instruments | 11 | 52 |
Foreign Exchange Forward [Member] | Not Designated as Hedging Instrument [Member] | Other Current Liabilities [Member] | ||
Fair value of derivatives | ||
Derivative liabilities designated as hedging instruments | $ (763) | $ (44) |
Derivative Instruments and He59
Derivative Instruments and Hedging Activities - Losses (gains) related to Derivatives Not Designated as Hedging Instruments and to Cash Flow Hedges (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Foreign Exchange Forward [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 | $ 719 | $ (1,026) | $ 1,057 |
Range Forward And Interest Rate Swap Contracts [Member] [Member] | Cash flow hedging [Member] | |||
(Gains) losses related to cash flow hedges | |||
Gains (losses) recognized in other comprehensive loss (income), net | (297) | 6,651 | (702) |
Losses (gains) reclassified from accumulated other comprehensive loss into other (income) expense, net | $ 381 | $ (250) | $ 1,399 |
Derivative Instruments and He60
Derivative Instruments and Hedging Activities - Narrative 1 (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Derivative Instruments and Hedging Activities (Textual) [Abstract] | ||
Gains or losses recognized in earnings due to ineffectiveness and excluded from effectiveness testing | $ 0 | $ 0 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Inventories | ||
Finished goods | $ 284,054 | $ 324,840 |
Work in process and powder blends | 166,274 | 249,629 |
Raw materials | 68,472 | 100,881 |
Inventories at current cost | 518,800 | 675,350 |
Less: LIFO valuation | (59,970) | (99,819) |
Total inventories | $ 458,830 | $ 575,531 |
Inventories (Textual) [Abstract] | ||
Percentage of inventories valued by using LIFO method | 44.00% | 47.00% |
Goodwill and Other Intangible62
Goodwill and Other Intangible Assets Schedule of Goodwill (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Goodwill [Line Items] | ||||
Goodwill, Gross | $ 1,082,540 | $ 1,095,731 | $ 1,126,418 | |
Goodwill, Accumulated Impairment Loss | (784,053) | (678,342) | (150,842) | |
Goodwill | 298,487 | 417,389 | 975,576 | |
Goodwill, Written off Related to Sale of Business Unit | (7,536) | |||
Goodwill, Acquired During Period | 2,984 | 246,600 | ||
Goodwill, Translation Adjustments | (5,655) | (33,671) | ||
Goodwill, Period Increase (Decrease) | (13,191) | (30,687) | ||
Goodwill, Impairment Loss | (105,711) | |||
Industrial [Member] | ||||
Goodwill [Line Items] | ||||
Goodwill, Gross | 449,329 | 455,371 | 472,337 | |
Goodwill, Accumulated Impairment Loss | (150,842) | (150,842) | (150,842) | |
Goodwill | 298,500 | 304,529 | 321,495 | |
Goodwill, Written off Related to Sale of Business Unit | (1,075) | |||
Goodwill, Acquired During Period | 2,984 | |||
Goodwill, Translation Adjustments | (4,967) | (19,950) | ||
Goodwill, Period Increase (Decrease) | (6,042) | (16,966) | ||
Goodwill, Impairment Loss | 0 | |||
Infrastructure [Member] | ||||
Goodwill [Line Items] | ||||
Goodwill, Gross | 633,211 | 640,360 | 654,081 | |
Goodwill, Accumulated Impairment Loss | (633,211) | (527,500) | 0 | |
Goodwill | 0 | 112,860 | $ 654,081 | |
Goodwill, Written off Related to Sale of Business Unit | (6,461) | |||
Goodwill, Acquired During Period | 0 | |||
Goodwill, Translation Adjustments | (688) | (13,721) | ||
Goodwill, Period Increase (Decrease) | (7,149) | $ (13,721) | ||
Goodwill, Impairment Loss | $ 105,700 | $ (105,711) |
Goodwill and Other Intangible63
Goodwill and Other Intangible Assets Other Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 114,093 | $ 153,370 |
Intangible Assets, Gross (Excluding Goodwill) | 321,301 | 440,039 |
Contractual Rights [Member] | ||
Finite-Lived Intangible Assets, Gross | 7,152 | 8,523 |
Finite-Lived Intangible Assets, Accumulated Amortization | 6,886 | 6,990 |
Technology-Based and other [Member] | ||
Finite-Lived Intangible Assets, Gross | 47,323 | 52,820 |
Finite-Lived Intangible Assets, Accumulated Amortization | 27,011 | 29,723 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets, Gross | 205,471 | 275,796 |
Finite-Lived Intangible Assets, Accumulated Amortization | 66,938 | 90,141 |
Unpatented Technology [Member] | ||
Finite-Lived Intangible Assets, Gross | 31,837 | 59,449 |
Finite-Lived Intangible Assets, Accumulated Amortization | 4,614 | 14,426 |
Trademarks [Member] | ||
Finite-Lived Intangible Assets, Gross | 12,668 | 18,575 |
Finite-Lived Intangible Assets, Accumulated Amortization | 8,644 | 12,090 |
Trademarks [Member] | ||
Indefinite-Lived Intangible Assets (Excluding Goodwill) | $ 16,850 | $ 24,876 |
Goodwill and Other Intangible64
Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets (Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Goodwill and Other Intangible Assets [Abstract] | |||
Amortization of Intangible Assets | $ 20,762 | $ 26,686 | $ 26,195 |
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months | 15,800 | ||
Finite-Lived Intangible Assets, Amortization Expense, Year Two | 14,300 | ||
Finite-Lived Intangible Assets, Amortization Expense, Year Three | 13,900 | ||
Finite-Lived Intangible Assets, Amortization Expense, Year Four | 13,700 | ||
Finite-Lived Intangible Assets, Amortization Expense, Year Five | $ 13,300 |
Other Current Liabilities (Deta
Other Current Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 |
Other Liabilities, Current [Abstract] | |||
Accrued Employee Benefits, Current | $ 33,754 | $ 40,995 | |
Accrued Restructuring (Note 15) | 15,703 | 20,788 | $ 9,002 |
Payroll State and Local Taxes | 12,983 | 15,006 | |
Accrued Professional Fees, Current | 12,112 | 11,710 | |
Accrued Interest | 7,079 | 7,040 | |
Other | 70,638 | 83,139 | |
Total Other Current Liabilities | $ 152,269 | $ 178,678 |
Long-Term Debt and Capital Le66
Long-Term Debt and Capital Leases (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Long-term Debt and Capital Lease Obligations Current and Noncurrent | ||
Capital leases | $ 748 | $ 1,771 |
Other | 0 | 6 |
Long-term Debt and Capital Lease Obligations, Including Current Maturities | 700,290 | 744,014 |
Long-term Debt, Current Maturities [Abstract] | ||
Long-term Debt, Current Maturities | 0 | (8,049) |
Capital Lease, Current Maturities | (732) | (74) |
Other, Current Maturities | 0 | (6) |
Total Current Maturities | (732) | (8,129) |
Long-term Debt and Capital Leases, Less Current Maturities | 699,558 | 735,885 |
Euro Denominated Borrowings [Member] | ||
Long-term Debt and Capital Lease Obligations Current and Noncurrent | ||
Long-term Debt | 0 | 42,609 |
U.S. Dollar Denominated Borrowings [Member] | ||
Long-term Debt and Capital Lease Obligations Current and Noncurrent | ||
Long-term Debt | 0 | 200 |
2.650% Senior Notes due 2019 [Member] | ||
Long-term Debt and Capital Lease Obligations Current and Noncurrent | ||
Long-term Debt | 399,748 | 399,671 |
3.875% Senior Unsecured Notes Due in 2022 [Member] | ||
Long-term Debt and Capital Lease Obligations Current and Noncurrent | ||
Long-term Debt | $ 299,794 | $ 299,757 |
Long-Term Debt and Capital Le67
Long-Term Debt and Capital Leases - Future Minimum Lease Payments (Details) $ in Thousands | Jun. 30, 2016USD ($) |
Future Minimum Lease Payments Under Capital Leases | |
2,017 | $ 775 |
2,018 | 25 |
2,019 | 0 |
2,020 | 0 |
2,021 | 0 |
After 2,021 | 0 |
Total Future Minimum Lease Payments | 800 |
Less Amount Representing Interest | (52) |
Capital Leases, Future Minimum Payments, Excluding Interest | $ 748 |
Long -Term Debt and Capital Lea
Long -Term Debt and Capital Leases - Narrative (Details) - USD ($) $ in Thousands | Nov. 07, 2012 | Feb. 29, 2012 | Jun. 30, 2016 | Jun. 30, 2015 | Feb. 14, 2012 | Oct. 21, 2011 |
Long Term Debt and Capital Leases (Additional Textual) [Abstract] | ||||||
Minimum Interest Rate Stated Percentage under Capital Lease with terms | 1.60% | 1.60% | ||||
Maximum Interest Rate Stated Percentage under Capital Leases with terms | 5.40% | 5.40% | ||||
Long-term Debt, Maturities, Repayments of Principal in Year Five | $ 400,000 | |||||
Future Principal Maturities of Long-term Debt Beyond 2020 | 299,800 | |||||
Capital Lease Obligations | $ 748 | $ 1,771 | ||||
US Dollar Denominated Borrowings [Member] | ||||||
Long-Term Debt and Capital Leases (Textual) [Abstract] | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 1.20% | 1.20% | ||||
Euro Denominated Borrowings [Member] | ||||||
Long-Term Debt and Capital Leases (Textual) [Abstract] | ||||||
Debt Instrument, Interest Rate, Effective Percentage Rate Range, Minimum | 0.90% | 0.90% | ||||
Debt Instrument, Interest Rate, Effective Percentage Rate Range, Maximum | 1.10% | 1.10% | ||||
2.650% Senior Notes due 2019 [Member] | ||||||
Long-Term Debt and Capital Leases (Textual) [Abstract] | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 2.65% | |||||
Debt Instrument, Unamortized Discount | $ 300 | $ 300 | ||||
Long Term Debt and Capital Leases (Additional Textual) [Abstract] | ||||||
Proceeds from Issuance of Senior Long-term Debt | $ 400,000 | |||||
3.875% Senior Unsecured Notes Due in 2022 [Member] | ||||||
Long-Term Debt and Capital Leases (Textual) [Abstract] | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.875% | |||||
Debt Instrument, Unamortized Discount | 200 | 200 | ||||
Long Term Debt and Capital Leases (Additional Textual) [Abstract] | ||||||
Proceeds from Issuance of Senior Long-term Debt | $ 300,000 | |||||
2011 Credit Agreement [Member] | ||||||
Long-Term Debt and Capital Leases (Textual) [Abstract] | ||||||
Maximum Borrowing Capacity under the 2011 Credit Agreement | $ 600,000 | |||||
Borrowing outstanding under 2011 Credit Agreement | $ 0 | $ 42,800 | ||||
Term of Long Term Debt | 5 years |
Notes Payable and Lines of Cr69
Notes Payable and Lines of Credit (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Notes Payable and Lines of Credit (Textual) [Abstract] | ||
Notes Payable | $ 1,163 | $ 7,573 |
Weighted Average Interest Rate for Notes Payable and Lines of Credit | 9.00% | 2.00% |
Notes Payable to Banks [Member] | ||
Notes Payable and Lines of Credit (Textual) [Abstract] | ||
Notes Payable | $ 1,200 | $ 7,600 |
Line of Credit Facility, Maximum Borrowing Capacity | 152,400 | |
Line of Credit Facility Unused | $ 151,200 |
Income Taxes - Effective Tax Ra
Income Taxes - Effective Tax Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Before Income Taxes | |||
United States | $ (228,667) | $ (323,299) | $ 59,160 |
International | 30,096 | (64,316) | 169,649 |
Total (loss) income Before Income Taxes | (198,571) | (387,615) | 228,809 |
Current Income Taxes | |||
Federal | (15,039) | (9,328) | 15,108 |
State | 454 | 816 | 896 |
International | 31,570 | 40,433 | 27,488 |
Total Current Income Taxes | 16,985 | 31,921 | 43,492 |
Deferred Income Tax Expense (Benefit), Continuing Operations [Abstract] | |||
Federal | 6,786 | (38,943) | 10,157 |
State | 8,407 | (8,680) | (62) |
International | (6,865) | (952) | 13,024 |
Total deferred income taxes | 8,328 | (48,575) | 23,119 |
Provision (benefit) for income taxes | $ 25,313 | $ (16,654) | $ 66,611 |
Effective tax rate | (12.70%) | 4.30% | 29.10% |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Reconciliation of Income Taxes Computed Using the Statutory U.S. Income Tax Rate and the Provision for Income Taxes [Abstract] | |||
Income Taxes at U.S Statutory Rate | $ (69,500) | $ (135,665) | $ 80,083 |
State Income Taxes, Net of Federal Tax Benefits | 859 | (1,748) | 1,593 |
US Income Tax Provided On International Income | 2,364 | 3,679 | 2,423 |
Combined Tax Effects of International Income | (25,469) | (21,560) | (22,580) |
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Impairment Losses, Amount | 6,439 | 134,657 | 0 |
Effective Income Tax Rate Reconciliation, Disposition of Business, Amount | 27,790 | 0 | 0 |
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Amount | 84,530 | 1,530 | (2,603) |
Impact of Domestic Production Activities Deduction | (2,072) | 0 | (942) |
Research and Development Credit | (4,351) | (3,087) | (1,385) |
Change In Permanent Reinvestment Assertion | 3,659 | 2,945 | 7,170 |
Other | 1,064 | 2,595 | 2,852 |
Provision (benefit) for income taxes | $ 25,313 | $ (16,654) | $ 66,611 |
Income Taxes - Components of Ne
Income Taxes - Components of Net Deferred Tax Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Deferred Tax Assets | ||
Net Operating Loss Carryforwards | $ 77,198 | $ 47,289 |
Inventory Valuation and Reserves | 18,865 | 18,023 |
Pension Benefits | 42,432 | 23,559 |
Other Postretirement Benefits | 7,111 | 7,359 |
Accrued Employee Benefits | 17,069 | 23,674 |
Other Accrued Liabilities | 9,229 | 18,210 |
Hedging Activities | 5,507 | 4,354 |
Tax Credit and Other Carryforwards | 30,733 | 13,815 |
Deferred Tax Assets, Goodwill and Intangible Assets | 21,575 | 0 |
Other | 0 | 12,028 |
Total | 229,719 | 168,311 |
Valuation Allowance | (122,699) | (16,771) |
Total Deferred Tax Assets | 107,020 | 151,540 |
Deferred Tax Liabilities | ||
Tax Depreciation in Excess of Book | 83,412 | 102,480 |
Intangible Assets | 0 | 18,688 |
Deferred Tax Liabilities, Other | 149 | 0 |
Total Deferred Tax Liabilities | 83,561 | 121,168 |
Total Net Deferred Tax Liabilities | $ 23,459 | $ 30,372 |
Income Taxes - Reconciliation73
Income Taxes - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Tax Disclosure [Abstract] | |||
Balance at beginning of year | $ 14,619 | $ 20,366 | $ 26,798 |
Increases for tax positions of prior years | 1,197 | 0 | 1,461 |
Decreases for tax positions of prior years | 0 | (3,188) | (6,982) |
Increases for tax positions related to the current year | 0 | 0 | 116 |
Decreases related to settlement with taxing authority | (11,942) | (348) | (2,161) |
Unrecognized Tax Benefits, Reduction Resulting from Lapse of Applicable Statute of Limitations | (667) | (398) | 0 |
Foreign currency translation | (101) | (1,813) | 1,134 |
Balance at end of year | $ 3,106 | $ 14,619 | $ 20,366 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Tax (Textual) [Abstract] | |||
Tax Adjustments Related to Settlements of Uncertain Tax Positions | $ 2,200 | ||
Valuation Allowance Adjustment | $ 84,530 | $ 1,530 | (2,603) |
Change In Permanent Reinvestment Assertion | 3,659 | 2,945 | 7,170 |
Tax Benefits associated with Net Operating Loss Carryforwards in Federal, State and Foreign Jurisdictions | 77,198 | 47,289 | |
Tax Benefits that Do Not Expire | 24,600 | ||
Valuation Allowance | (122,699) | (16,771) | |
Change in Valuation Allowance, Current Year | 105,900 | ||
Deferred Tax Assets, Tax Credit Carryforwards | 30,733 | 13,815 | |
Unremitted Earnings of Non-U.S. Subsidiaries and Affiliates | 2,019,400 | ||
Unrecognized Tax Benefits that Would Impact Effective Tax Rate | 3,100 | 2,700 | 2,400 |
Interest Expense | 800 | ||
Reduction in Interest | 200 | 700 | |
Interest Accrued | 300 | 500 | |
Penalties Accrued | 300 | 200 | |
Deferred Tax Assets, Other | $ 11,900 | ||
Reasonably Possible amount of Unrecognized Tax Benefits within next 12 Months Could Decrease | 600 | ||
Expiring Year Fifteen Through Twenty [Member] | |||
Income Tax (Textual) [Abstract] | |||
Deferred Tax Assets, Operating Loss Carryforwards, Subject to Expiration | 39,700 | ||
Expiring Year Ten Through Fifteen [Member] | |||
Income Tax (Textual) [Abstract] | |||
Deferred Tax Assets, Operating Loss Carryforwards, Subject to Expiration | 2,100 | ||
Expiring Year Five Through Ten [Member] | |||
Income Tax (Textual) [Abstract] | |||
Deferred Tax Assets, Operating Loss Carryforwards, Subject to Expiration | 3,600 | ||
Expiring Through Year Five [Member] | |||
Income Tax (Textual) [Abstract] | |||
Deferred Tax Assets, Operating Loss Carryforwards, Subject to Expiration | 7,200 | ||
Valuation Allowance, Operating Loss Carryforwards [Member] | |||
Income Tax (Textual) [Abstract] | |||
Valuation Allowance Adjustment | 81,200 | ||
Change in Valuation Allowance, Current Year | 105,900 | ||
State Law Tax Change [Member] | |||
Income Tax (Textual) [Abstract] | |||
Valuation Allowance Adjustment | $ 1,200 | ||
Other Comprehensive Income (Loss) [Member] | Valuation Allowance, Operating Loss Carryforwards [Member] | |||
Income Tax (Textual) [Abstract] | |||
Change in Valuation Allowance, Current Year | 24,700 | ||
Expiring Year Fifteen Through Twenty [Member] | |||
Income Tax (Textual) [Abstract] | |||
Deferred Tax Assets, Tax Credit Carryforwards | 5,900 | ||
Expiring Year Ten Through Fifteen [Member] | |||
Income Tax (Textual) [Abstract] | |||
Deferred Tax Assets, Tax Credit Carryforwards | 600 | ||
Expiring Year Five Through Ten [Member] | |||
Income Tax (Textual) [Abstract] | |||
Deferred Tax Assets, Tax Credit Carryforwards | 22,900 | ||
Expiring Through Year Five [Member] | |||
Income Tax (Textual) [Abstract] | |||
Deferred Tax Assets, Tax Credit Carryforwards | 1,100 | ||
Non-expiring [Member] | |||
Income Tax (Textual) [Abstract] | |||
Deferred Tax Assets, Tax Credit Carryforwards | $ 200 |
Pension and Other Postretirem75
Pension and Other Postretirement Benefits - Funded Status of Pension Plans and Amounts Recognized in the Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Change in Plan Assets | |||
Fair Value of Plans' Assets, Beginning of Year | $ 827,337 | ||
Fair Value of Plans' Assets, End of Year | 821,675 | $ 827,337 | |
Pension plans contribution [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Settlements, Plan Assets | 7,991 | 0 | |
Change in Benefit Obligation | |||
Benefit Obligation, Beginning of Year | 954,454 | 969,904 | |
Service Cost | 4,640 | 5,474 | $ 6,910 |
Interest Cost | 37,726 | 39,007 | 41,084 |
Participant Contributions | 6 | 12 | |
Actuarial Losses | 86,425 | 50,464 | |
Benefits and expenses paid | (45,074) | (73,897) | |
Currency Translation Adjustment | (19,283) | (36,377) | |
Defined Benefit Plan, Plan Amendments | 696 | 0 | |
Defined Benefit Plan, Special Termination Benefits | 334 | 459 | |
Defined Benefit Plan, Settlements, Benefit Obligation | (7,991) | 0 | |
Defined Benefit Plan, Curtailments | 6,565 | 592 | |
Benefit Obligation, End of Year | 1,005,368 | 954,454 | 969,904 |
Change in Plan Assets | |||
Fair Value of Plans' Assets, Beginning of Year | 827,337 | 884,264 | |
Actual Return on Plans' Assets | 50,637 | 20,007 | |
Company Contributions | 15,876 | 8,703 | |
Participant Contributions | 6 | 12 | |
Benefits and expenses paid | (45,074) | (73,897) | |
Currency translation adjustments | (19,116) | (11,752) | |
Fair Value of Plans' Assets, End of Year | 821,675 | 827,337 | $ 884,264 |
Funded Status of Plans | (183,693) | (127,117) | |
Defined Benefit Plan, Assets for Plan Benefits, Noncurrent | 8,941 | 31,274 | |
Amounts Recognized in Balance Sheet | |||
Short-term Accrued Benefit Obligation | (10,037) | (14,592) | |
Accrued Pension Benefits | (182,597) | (143,799) | |
Net Amount Recognized | $ (183,693) | $ (127,117) |
Pension and Other Postretirem76
Pension and Other Postretirement Benefits - Amounts Related to Defined Pension Plans Recognized in Accumulated Other Comprehensive (Loss) Income (Details) - Pension plans contribution [Member] - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Pension and Other Postretirement Benefit Plans, Accumulated Other Comprehensive Income (Loss), before Tax [Abstract] | ||
Unrecognized Net Actuarial Losses | $ 272,802 | $ 196,567 |
Unrecognized Net Prior Service Credits | 155 | (953) |
Unrecognized Transition Obligations | 740 | 651 |
Total | $ 273,697 | $ 196,265 |
Pension and Other Postretirem77
Pension and Other Postretirement Benefits - Plans with Accumulated Benefit Obligations Exceeding the Fair Value of Plan Assets (Details) - Pension plans contribution [Member] - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Defined Benefit Plan Disclosure [Line Items] | ||
Project Benefit Obligation | $ 877,146 | $ 165,281 |
Accumulated Benefit Obligation | 875,233 | 164,913 |
Fair Value of Plan Assets | $ 684,512 | $ 7,394 |
Pension and Other Postretirem78
Pension and Other Postretirement Benefits - Components of Net Periodic Pension (Income) Cost (Details) - Pension plans contribution [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Net periodic pension income | |||
Service cost | $ 4,640 | $ 5,474 | $ 6,910 |
Interest cost | 37,726 | 39,007 | 41,084 |
Expected Return on Plans' Assets | (58,523) | (59,698) | (59,527) |
Amortization of transition obligation | 80 | 78 | 78 |
Amortization of prior service cost | (417) | (361) | (234) |
Special termination benefit charge | 334 | 459 | 0 |
Curtailment loss | 0 | (358) | 0 |
Settlement Loss | 227 | 261 | 0 |
Recognition of actuarial losses | 7,286 | 3,671 | 2,642 |
Net Periodic Benefit (Income) Cost | $ (8,647) | $ (10,751) | $ (9,047) |
Pension and Other Postretirem79
Pension and Other Postretirement Benefits - Funded Status of Other Postretirement Benefit Plans and Amounts Recognized in the Consolidated Balance Sheets (Details) - Other Postretirement Benefit Plan, Defined Benefit [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Change in Benefit Obligation | |||
Benefit Obligation, Beginning of Year | $ 21,205 | $ 24,476 | |
Service Cost | 0 | 45 | $ 55 |
Interest Cost | 840 | 934 | 1,006 |
Actuarial Losses | 722 | 1,489 | |
Benefits Paid | (2,225) | (2,155) | |
Benefit Obligation, End of Year | 20,542 | 21,205 | $ 24,476 |
Funded Status of Plans | (20,542) | (21,205) | |
Amounts Recognized in Balance Sheet | |||
Short-term Accrued Benefit Obligation | (1,666) | (1,975) | |
Accrued Postretirement Benefits | (18,876) | (19,230) | |
Net Amount Recognized | $ (20,542) | $ (21,205) |
Pension and Other Postretirem80
Pension and Other Postretirement Benefits - Amounts Related to Other Postretirement Benefit Plans Recognized in Accumulated Other Comprehensive (Loss) Income (Details) - Other postretirement benefit plans [Member] - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Defined Benefit Plan, Amounts Recognized in Other Comprehensive Income (Loss) [Abstract] | ||
Unrecognized Net Actuarial Losses | $ 6,368 | $ 5,969 |
Unrecognized Net Prior Service Credits | (150) | (172) |
Total | $ 6,218 | $ 5,797 |
Pension and Other Postretirem81
Pension and Other Postretirement Benefits - Components of Net Periodic Other Postretirement Benefit Cost (Details) - Other postretirement benefit plans [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Net periodic other postretirement benefit costs | |||
Service cost | $ 0 | $ 45 | $ 55 |
Interest cost | 840 | 934 | 1,006 |
Amortization of prior service credit | (22) | (59) | (111) |
Recognition of actuarial loss | 324 | 492 | 317 |
Curtailment Gain | 0 | (221) | 0 |
Net Periodic Benefit (Income) Cost | $ 1,142 | $ 1,191 | $ 1,267 |
Pension and Other Postretirem82
Pension and Other Postretirement Benefits (Details 7) | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 |
U.S. Plans [Member] | |||
Discount Rate | |||
Discount Rate | 4.40% | ||
Minimum [Member] | U.S. Plans [Member] | |||
Discount Rate | |||
Discount Rate | 2.40% | 3.20% | |
Rates of Future Salary Increases [Abstract] | |||
Rate of Future Salary Increase | 3.00% | 3.00% | 3.00% |
Minimum [Member] | International Plans [Member] | |||
Discount Rate | |||
Discount Rate | 0.90% | 2.30% | 2.90% |
Rates of Future Salary Increases [Abstract] | |||
Rate of Future Salary Increase | 2.50% | 2.50% | 2.50% |
Maximum [Member] | U.S. Plans [Member] | |||
Discount Rate | |||
Discount Rate | 3.70% | 4.50% | |
Rates of Future Salary Increases [Abstract] | |||
Rate of Future Salary Increase | 4.00% | 4.00% | 5.00% |
Maximum [Member] | International Plans [Member] | |||
Discount Rate | |||
Discount Rate | 3.20% | 3.80% | 4.30% |
Rates of Future Salary Increases [Abstract] | |||
Rate of Future Salary Increase | 3.00% | 3.00% | 3.00% |
Pension and Other Postretirem83
Pension and Other Postretirement Benefits (Details 8) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
U.S. Plans [Member] | |||
Discount Rate [Abstract] | |||
Discount Rate | 4.40% | 4.90% | |
Rate of Return on Plans Assets [Abstract] | |||
Rate of Return on Plan Assets | 7.50% | 7.50% | 8.00% |
International Plans [Member] | |||
Rate of Return on Plans Assets [Abstract] | |||
Rate of Return on Plan Assets | 5.00% | ||
Minimum [Member] | U.S. Plans [Member] | |||
Discount Rate [Abstract] | |||
Discount Rate | 3.20% | ||
Rates of Future Salary Increases [Abstract] | |||
Rate of Future Salary Increases | 3.00% | 3.00% | 3.00% |
Rate of Return on Plans Assets [Abstract] | |||
Rate of Return on Plan Assets | 5.30% | 5.00% | 5000.00% |
Minimum [Member] | International Plans [Member] | |||
Discount Rate [Abstract] | |||
Discount Rate | 2.30% | 2.90% | 3.50% |
Rates of Future Salary Increases [Abstract] | |||
Rate of Future Salary Increases | 2.50% | 2.50% | 2.50% |
Maximum [Member] | U.S. Plans [Member] | |||
Discount Rate [Abstract] | |||
Discount Rate | 4.50% | ||
Rates of Future Salary Increases [Abstract] | |||
Rate of Future Salary Increases | 4.00% | 5.00% | 5.00% |
Rate of Return on Plans Assets [Abstract] | |||
Rate of Return on Plan Assets | 5.50% | 6.00% | 6000.00% |
Maximum [Member] | International Plans [Member] | |||
Discount Rate [Abstract] | |||
Discount Rate | 3.80% | 4.30% | 4.80% |
Rates of Future Salary Increases [Abstract] | |||
Rate of Future Salary Increases | 3.00% | 3.00% | 3.00% |
Pension and Other Postretirem84
Pension and Other Postretirement Benefits - Significant Assumptions to Determine the Present Value of Net Benefit Obligations and the Net Periodic Costs (Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Annual assumed rate of increase in per capita cost of covered benefits for postretirement benefit plans | |||
Health Care Cost Trend Rate Assumed for Next Year | 8.50% | 7.30% | 7.50% |
Rate to which the Cost Trend Rate Gradually Declines | 5.00% | 5.00% | 5.00% |
Year that the Rate Reaches the Rate at which it is assumed to Remain | 2,027 | 2,024 | 2,024 |
Calculated effect of change on assumption used to calculate cost components and obligations of healthcare plans | |||
Effect on Total Service and Interest Cost Components, Increase | $ 37 | ||
Effect on Total Service and Interest Cost Components, Decrease | (33) | ||
Effect on Other Postretirement Obligation, Increase | 864 | ||
Effect on Other Postretirement Obligation, Decrease | $ (776) |
Pension and Other Postretirem85
Pension and Other Postretirement Benefits Pension and Other Postretirement Benefits - Allocation of Plan Assets (Details) | 12 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Equity Securities [Member] | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Defined Benefit Plan, Actual Plan Asset Allocations | 23.00% | 32.00% |
Defined Benefit Plan, Target Plan Asset Allocations | 23.00% | |
Fixed Income Securities [Member] | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Defined Benefit Plan, Actual Plan Asset Allocations | 67.00% | 65.00% |
Defined Benefit Plan, Target Plan Asset Allocations | 70.00% | |
Other Security Investments [Member] | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Defined Benefit Plan, Actual Plan Asset Allocations | 10.00% | 3.00% |
Defined Benefit Plan, Target Plan Asset Allocations | 8.00% |
Pension and Other Postretirem86
Pension and Other Postretirement Benefits - Hierarchy of Fair Value of the Benefit Plan Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | $ 821,675 | $ 827,337 |
Level 1 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 77,192 | 98,360 |
Level 2 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 744,483 | 728,977 |
Corporate Fixed Income Securities [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 395,102 | 391,275 |
Corporate Fixed Income Securities [Member] | Level 2 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 395,102 | 391,275 |
Value Funds [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 68,731 | 102,466 |
Value Funds [Member] | Level 2 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 68,731 | 102,466 |
Growth Funds [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 38,126 | 54,179 |
Growth Funds [Member] | Level 2 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 38,126 | 54,179 |
Balanced Funds [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 8,581 | 10,090 |
Balanced Funds [Member] | Level 2 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 8,581 | 10,090 |
Common Stock [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 74,163 | 94,964 |
Common Stock [Member] | Level 1 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 74,163 | 94,964 |
US Government Securities [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 79,275 | 68,628 |
US Government Securities [Member] | Level 2 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 79,275 | 68,628 |
Foreign Government Securities [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 43,729 | 44,474 |
Foreign Government Securities [Member] | Level 2 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 43,729 | 44,474 |
Other Fixed Income Securities [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 31,503 | 32,540 |
Other Fixed Income Securities [Member] | Level 2 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 31,503 | 32,540 |
Other [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 82,465 | 28,721 |
Other [Member] | Level 1 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | 3,029 | 3,396 |
Other [Member] | Level 2 [Member] | ||
Benefit Plan Assets Classified Under Appropriate Level of Fair Value Hierarchy [Abstract] | ||
Defined Benefit Plans', Fair Value of Plan Assets | $ 79,436 | $ 25,325 |
Pension and Other Postretirem87
Pension and Other Postretirement Benefits - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Eligible Age for Availing Postretirement Healthcare Benefits | 55 | ||
Years of Service | 10 | ||
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |||
Defined Contribution Plan, Cost Recognized | $ 17,189 | $ 23,118 | $ 20,386 |
Pension plans contribution [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Settlements, Benefit Obligation | (7,991) | 0 | |
Accumulated Benefit Obligation for all Defined Benefit Pension Plans | 1,003,500 | 943,500 | |
Net Periodic Pension Cost | (8,647) | (10,751) | (9,047) |
Special termination benefit charge | 334 | 459 | 0 |
Defined Benefit Plan, Recognized Net Gain (Loss) Due to Settlements | (227) | (261) | 0 |
Curtailment loss | 0 | (358) | 0 |
Projected Benefit Payments for 2016 | 52,200 | ||
Projected Benefit Payments for 2017 | 48,200 | ||
Projected Benefit Payments for 2018 | 50,100 | ||
Projected Benefit Payments for 2019 | 51,800 | ||
Projected Benefit Payments for 2020 | 53,500 | ||
Projected Benefit Payments for 2021 through 2025 | 283,300 | ||
Accumulated Other Comprehensive Loss Expected to be Recognized in Net Periodic Pension Cost during 2015 related to Net Actuarial Losses | 8,500 | ||
Accumulated Other Comprehensive Loss Expected to be Recognized in Net Periodic Pension Cost during 2015 related to Transition Obligations | 94 | ||
Accumulated Other Comprehensive Income Expected to be Recognized in Net Periodic Pension Cost during 2015 related to Prior Service Credit | (500) | ||
Estimated Future Employer Contributions in 2015 | 12,100 | ||
Other postretirement benefit plans [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net Periodic Pension Cost | 1,142 | 1,191 | 1,267 |
Curtailment loss | 0 | $ 221 | $ 0 |
Projected Benefit Payments for 2016 | 2,000 | ||
Projected Benefit Payments for 2017 | 1,900 | ||
Projected Benefit Payments for 2018 | 1,800 | ||
Projected Benefit Payments for 2019 | 1,700 | ||
Projected Benefit Payments for 2020 | 1,600 | ||
Projected Benefit Payments for 2021 through 2025 | 6,800 | ||
Accumulated Other Comprehensive Loss Expected to be Recognized in Net Periodic Pension Cost during 2015 related to Net Actuarial Losses | 400 | ||
Estimated Future Employer Contributions in 2015 | $ 2,000 |
Accumulated Other Comprehensi88
Accumulated Other Comprehensive (Loss) Income - Components of and Changes in AOCL (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | $ (243,523) | ||
Net current period other comprehensive loss | (112,690) | $ (180,737) | $ 23,238 |
Accumulated Other Comprehensive (Loss) Income | (352,509) | (243,523) | |
Post-retirement Benefit Plans [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (138,793) | (93,742) | (83,936) |
Net current period other comprehensive loss | (73,370) | (45,051) | (9,806) |
Other comprehensive loss before reclassifications | (78,295) | (47,982) | (11,990) |
Amounts reclassified from accumulated other comprehensive loss | 4,925 | 2,931 | 2,184 |
Accumulated Other Comprehensive (Loss) Income | (212,163) | (138,793) | (93,742) |
Currency Translation Adjustment [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (97,309) | 38,811 | 7,413 |
Net current period other comprehensive loss | (36,420) | (136,120) | 31,398 |
Other comprehensive loss before reclassifications | (51,508) | (136,120) | 31,398 |
Stock Issued During Period, Value, Other | 2,517 | ||
Accumulated Other Comprehensive (Loss) Income | (131,212) | (97,309) | 38,811 |
Derivatives [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (7,421) | (11,200) | (12,481) |
Net current period other comprehensive loss | (1,713) | 3,779 | 1,281 |
Other comprehensive loss before reclassifications | (150) | 6,652 | (706) |
Amounts reclassified from accumulated other comprehensive loss | (1,563) | (2,873) | 1,987 |
Accumulated Other Comprehensive (Loss) Income | (9,134) | (7,421) | (11,200) |
AOCI Attributable to Parent [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (243,523) | (66,131) | (89,004) |
Net current period other comprehensive loss | (111,503) | (177,392) | 22,873 |
Other comprehensive loss before reclassifications | (129,953) | (177,450) | 18,702 |
Amounts reclassified from accumulated other comprehensive loss | 18,450 | 58 | 4,171 |
Stock Issued During Period, Value, Other | 2,517 | 0 | 0 |
Net current period other comprehensive loss | (111,503) | (177,392) | 22,873 |
Accumulated Other Comprehensive (Loss) Income | (352,509) | (243,523) | (66,131) |
Accumulated Foreign Currency Adjustment Attributable to Noncontrolling Interest [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (2,258) | 1,087 | 721 |
Other comprehensive loss before reclassifications | (1,188) | (3,345) | 366 |
Net current period other comprehensive loss | (1,188) | (3,345) | 366 |
Accumulated Other Comprehensive (Loss) Income | (3,446) | (2,258) | 1,087 |
AOCI Attributable to Noncontrolling Interest [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (2,258) | 1,087 | 721 |
Other comprehensive loss before reclassifications | (1,188) | (3,345) | 366 |
Net current period other comprehensive loss | (1,188) | (3,345) | 366 |
Accumulated Other Comprehensive (Loss) Income | $ (3,446) | $ (2,258) | $ 1,087 |
Accumulated Other Comprehensi89
Accumulated Other Comprehensive (Loss) Income - Components of and Changes in AOCL (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | $ (352,509) | $ (243,523) | |
Other comprehensive (loss) income, net of tax | (112,690) | (180,737) | $ 23,238 |
Post-retirement Benefit Plans [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (212,163) | (138,793) | (93,742) |
Other comprehensive loss before reclassifications | (78,295) | (47,982) | (11,990) |
Amounts reclassified from accumulated other comprehensive loss | 4,925 | 2,931 | 2,184 |
Net current period other comprehensive loss | (73,370) | (45,051) | (9,806) |
Currency Translation Adjustment [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (131,212) | (97,309) | 38,811 |
Other comprehensive loss before reclassifications | (51,508) | (136,120) | 31,398 |
Sale of subsidiary stock to noncontrolling interests | 2,517 | ||
Net current period other comprehensive loss | (36,420) | (136,120) | 31,398 |
Derivatives [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (9,134) | (7,421) | (11,200) |
Other comprehensive loss before reclassifications | (150) | 6,652 | (706) |
Amounts reclassified from accumulated other comprehensive loss | (1,563) | (2,873) | 1,987 |
Net current period other comprehensive loss | (1,713) | 3,779 | 1,281 |
AOCI Attributable to Parent [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (352,509) | (243,523) | (66,131) |
Other comprehensive loss before reclassifications | (129,953) | (177,450) | 18,702 |
Other comprehensive (loss) income, net of tax | (111,503) | (177,392) | 22,873 |
Amounts reclassified from accumulated other comprehensive loss | 18,450 | 58 | 4,171 |
Sale of subsidiary stock to noncontrolling interests | 2,517 | 0 | 0 |
Net current period other comprehensive loss | (111,503) | (177,392) | 22,873 |
Accumulated Foreign Currency Adjustment Attributable to Noncontrolling Interest [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (3,446) | (2,258) | 1,087 |
Other comprehensive loss before reclassifications | (1,188) | (3,345) | 366 |
Other comprehensive (loss) income, net of tax | (1,188) | (3,345) | 366 |
AOCI Attributable to Noncontrolling Interest [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated Other Comprehensive (Loss) Income | (3,446) | (2,258) | 1,087 |
Other comprehensive loss before reclassifications | (1,188) | (3,345) | 366 |
Other comprehensive (loss) income, net of tax | $ (1,188) | $ (3,345) | $ 366 |
Accumulated Other Comprehensi90
Accumulated Other Comprehensive Loss - Reclassifications Out of AOCL (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Currency Exchange Contracts | $ 4,124 | $ 1,674 | $ (2,172) |
Recognition of Actuarial Losses | (7,251) | (3,821) | (2,692) |
Tax (expense) benefit | (25,313) | 16,654 | (66,611) |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, before Tax | (15,088) | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Derivatives [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Total Before Tax | (2,546) | (4,679) | 3,205 |
Tax (expense) benefit | 983 | 1,806 | (1,218) |
Net of tax | (1,563) | (2,873) | 1,987 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Post-retirement Benefit Plans [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Amortization of Transition Obligations | 80 | 78 | 78 |
Amortization of Prior Service Credit | (439) | (420) | (345) |
Recognition of Actuarial Losses | 7,610 | 4,163 | 2,959 |
Total Before Tax | 7,251 | 3,821 | 2,692 |
Tax (expense) benefit | (2,326) | (890) | (508) |
Net of tax | 4,925 | 2,931 | 2,184 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Currency Translation Adjustment [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Total Before Tax | 15,088 | 0 | 0 |
Tax (expense) benefit | 0 | 0 | 0 |
Net of tax | 15,088 | 0 | 0 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, before Tax | 15,088 | 0 | 0 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Forward Starting Interest Rate Swaps [Member] | Derivatives [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Forward Starting Interest Rate Swap Contracts | 2,099 | 2,021 | 1,945 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Currency Exchange Contracts [Member] | Derivatives [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Currency Exchange Contracts | $ (4,645) | $ (6,700) | $ 1,260 |
Accumulated Other Comprehensi91
Accumulated Other Comprehensive (Loss) Income Accumulated Other Comprehensive (Loss) Income - Income Tax Allocated to Each Component of Other Comprehensive Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Accumulated Other Comprehensive (Loss) IncomeAccumulated Other Comprehensive (Loss) Income - Income Tax Allocated to Each Component of Other Comprehensive Income [Abstract] | |||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | $ (244) | $ 10,834 | $ (1,139) |
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Tax | 100 | (4,200) | 400 |
Unrealized (loss) gain on derivatives designated and qualified as cash flow hedges | (150) | 6,652 | (706) |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, before Tax | (2,546) | (4,679) | 3,205 |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax | 1,000 | 1,800 | (1,200) |
Reclassification of unrealized (gain) loss on expired derivatives designated and qualified as cash flow hedges | (1,563) | (2,873) | 1,987 |
Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net Unamortized Gain (Loss) Arising During Period, before Tax | (84,266) | (76,029) | (15,900) |
Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net Unamortized Gain (Loss) Arising During Period, Tax | 6,000 | 28,000 | 3,900 |
Unrecognized net pension and other postretirement benefit loss | (78,295) | (47,982) | (11,990) |
Other Comprehensive (Income) Loss, Reclassification Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, before Tax | 7,251 | 3,821 | 2,692 |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, for Net Gain (Loss), Tax | (2,300) | (900) | (500) |
Reclassification of net pension and other postretirement benefit loss | 4,925 | 2,931 | 2,184 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss), before Reclassification and Tax | (52,699) | (147,172) | 33,493 |
Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Tax | 0 | 7,700 | (1,700) |
Foreign currency translation adjustments | (52,695) | (139,465) | 31,763 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, before Tax | 15,088 | ||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, Tax | 0 | ||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, Net of Tax | 15,088 | 0 | 0 |
Other Comprehensive Income (Loss), before Tax | (117,416) | (213,225) | 22,351 |
Other Comprehensive Income (Loss), Tax | 4,726 | 32,488 | 887 |
Other comprehensive (loss) income, net of tax | $ (112,690) | $ (180,737) | $ 23,238 |
Restructuring and Related Cha92
Restructuring and Related Charges and Asset Impairment Charges - Restructuring Reserve by Type of Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Restructuring Reserve [Abstract] | |||
Beginning Balance | $ 20,788 | $ 9,002 | |
Expense | 30,015 | 42,063 | $ 17,789 |
Asset Write-Down | (4,694) | (5,869) | |
Reclass of Special Termination Benefit Charges | (548) | (459) | |
Translation | (207) | (603) | |
Cash Expenditures | (29,651) | (23,346) | |
Ending Balance | 15,703 | 20,788 | 9,002 |
Industrial [Member] | |||
Restructuring Reserve [Abstract] | |||
Beginning Balance | 13,484 | 6,326 | |
Expense | 17,949 | 23,067 | |
Asset Write-Down | (780) | (2,231) | |
Reclass of Special Termination Benefit Charges | (347) | 0 | |
Translation | (145) | (345) | |
Cash Expenditures | (20,173) | (13,333) | |
Ending Balance | 9,988 | 13,484 | 6,326 |
Industrial [Member] | Severance [Member] | |||
Restructuring Reserve [Abstract] | |||
Beginning Balance | 13,456 | 5,815 | |
Expense | 17,322 | 20,713 | |
Asset Write-Down | 0 | 0 | |
Reclass of Special Termination Benefit Charges | (347) | 0 | |
Translation | (140) | (328) | |
Cash Expenditures | (21,202) | (12,744) | |
Ending Balance | 9,089 | 13,456 | 5,815 |
Industrial [Member] | Facilities [Member] | |||
Restructuring Reserve [Abstract] | |||
Beginning Balance | 0 | 444 | |
Expense | 330 | 2,277 | |
Asset Write-Down | (780) | (2,231) | |
Reclass of Special Termination Benefit Charges | 0 | 0 | |
Translation | 0 | (15) | |
Cash Expenditures | 450 | (475) | |
Ending Balance | 0 | 0 | 444 |
Industrial [Member] | Other [Member] | |||
Restructuring Reserve [Abstract] | |||
Beginning Balance | 28 | 67 | |
Expense | 297 | 77 | |
Asset Write-Down | 0 | 0 | |
Reclass of Special Termination Benefit Charges | 0 | 0 | |
Translation | (5) | (2) | |
Cash Expenditures | 579 | (114) | |
Ending Balance | 899 | 28 | 67 |
Infrastructure [Member] | |||
Restructuring Reserve [Abstract] | |||
Beginning Balance | 7,304 | 2,676 | |
Expense | 12,066 | 18,996 | |
Asset Write-Down | (3,914) | (3,638) | |
Reclass of Special Termination Benefit Charges | (201) | (459) | |
Translation | (62) | (258) | |
Cash Expenditures | (9,478) | (10,013) | |
Ending Balance | 5,715 | 7,304 | 2,676 |
Infrastructure [Member] | Severance [Member] | |||
Restructuring Reserve [Abstract] | |||
Beginning Balance | 7,173 | 2,458 | |
Expense | 7,424 | 14,027 | |
Asset Write-Down | 0 | 0 | |
Reclass of Special Termination Benefit Charges | (201) | (459) | |
Translation | (60) | (223) | |
Cash Expenditures | (9,035) | (8,630) | |
Ending Balance | 5,301 | 7,173 | 2,458 |
Infrastructure [Member] | Facilities [Member] | |||
Restructuring Reserve [Abstract] | |||
Beginning Balance | 131 | 190 | |
Expense | 4,515 | 4,969 | |
Asset Write-Down | (3,914) | (3,638) | |
Reclass of Special Termination Benefit Charges | 0 | 0 | |
Translation | 0 | (32) | |
Cash Expenditures | (699) | (1,358) | |
Ending Balance | 33 | 131 | 190 |
Infrastructure [Member] | Other [Member] | |||
Restructuring Reserve [Abstract] | |||
Beginning Balance | 0 | 28 | |
Expense | 127 | 0 | |
Asset Write-Down | 0 | 0 | |
Reclass of Special Termination Benefit Charges | 0 | 0 | |
Translation | (2) | (3) | |
Cash Expenditures | 256 | (25) | |
Ending Balance | $ 381 | $ 0 | $ 28 |
Restructuring and Related Cha93
Restructuring and Related Charges and Asset Impairment Charges - Restructuring and Related Charges Narrative (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Restructuring and Related Costs and Reserve [Line Items] | |||
Tangible Asset Impairment Charges | $ 5,400,000 | ||
Restructuring and Related Cost, Incurred Cost | 53,500,000 | $ 58,100,000 | $ 19,086,000 |
Restructuring Charges | 30,015,000 | 42,063,000 | 17,789,000 |
Restructuring Charges Related to Inventory Disposals | 1,500,000 | 200,000 | |
Industrial [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring Charges | 17,949,000 | 23,067,000 | |
Infrastructure [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring Charges | 12,066,000 | 18,996,000 | |
Phase 1 [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring and Related Cost, Cost Incurred to Date | 59,276,000 | ||
Phase 1 [Member] | Industrial [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring and Related Cost, Cost Incurred to Date | 30,653,000 | ||
Phase 1 [Member] | Infrastructure [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring and Related Cost, Cost Incurred to Date | 26,197,000 | ||
Phase 1 [Member] | Corporate Segment [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring and Related Cost, Cost Incurred to Date | 2,426,000 | ||
Ongoing Restructuring [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring and Related Cost, Cost Incurred to Date | 71,418,000 | ||
Ongoing Restructuring [Member] | Minimum [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring and Related Cost, Expected Cost | 105,000,000 | ||
Ongoing Restructuring [Member] | Maximum [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring and Related Cost, Expected Cost | 125,000,000 | ||
Ongoing Restructuring [Member] | Industrial [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring and Related Cost, Expected Cost | 0.65 | ||
Restructuring and Related Cost, Cost Incurred to Date | 41,172,000 | ||
Ongoing Restructuring [Member] | Infrastructure [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring and Related Cost, Expected Cost | 0.35 | ||
Restructuring and Related Cost, Cost Incurred to Date | 23,315,000 | ||
Ongoing Restructuring [Member] | Corporate Segment [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring and Related Cost, Cost Incurred to Date | 6,931,000 | ||
Cost of Sales [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring Related Charges | 7,300,000 | 8,200,000 | 1,200,000 |
Operating Expense [Member] | |||
Restructuring and Related Costs and Reserve [Line Items] | |||
Restructuring Related Charges | $ 16,200,000 | $ 7,800,000 | $ 100,000 |
Financial Instruments (Details)
Financial Instruments (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Jun. 30, 2015 |
Fair Value [Line Items] | ||
Debt Instrument, Fair Value Disclosure | $ 704 | $ 698 |
Contracts Translated to U S Dollars [Member] | ||
Fair Value [Line Items] | ||
Notional Amount of Foreign Exchange Contracts | 53.3 | 53.8 |
Estimated Amount Of Receivable On Settlement Of Foreign Exchange Contracts | 0.3 | 2.6 |
Foreign Exchange Contract [Member] | ||
Fair Value [Line Items] | ||
Notional Amount of Foreign Exchange Contracts | $ 53.3 | $ 53.8 |
Stock-Based Compensation - Assu
Stock-Based Compensation - Assumptions Used in Black-Scholes Valuation for Grants (Details) - Stock Option [Member] | 12 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | ||
Assumptions used in valuation of stock options | ||||
Risk-free interest rate | 1.40% | 1.50% | 1.30% | |
Expected life (years) | [1] | 4 years 6 months | 4 years 6 months | 4 years 6 months |
Expected volatility | [2] | 31.70% | 32.50% | 40.30% |
Expected dividend yield | 2.10% | 1.70% | 1.70% | |
[1] | Expected life is derived from historical experience. | |||
[2] | Expected volatility is based on the implied historical volatility of our stock. |
Stock-Based Compensation - Chan
Stock-Based Compensation - Changes in Stock Options (Details) $ / shares in Units, $ in Thousands | 12 Months Ended |
Jun. 30, 2016USD ($)$ / sharesshares | |
Changes in stock options | |
Options outstanding, Beginning of Period | shares | 2,094,037 |
Options, Granted | shares | 885,403 |
Options, Exercised | shares | (39,177) |
Options, Lapsed and Forfeited | shares | (392,454) |
Options outstanding, End of Period | shares | 2,547,809 |
Options vested and expected to vest, June 30, 2016 | shares | 2,501,094 |
Options exercisable, June 30, 2016 | shares | 1,625,728 |
Weighted Average Exercise Price, Options outstanding, Beginning of Period | $ / shares | $ 36.08 |
Weighted Average Exercise Price, Granted | $ / shares | 28.29 |
Weighted Average Exercise Price, Exercised | $ / shares | 24.96 |
Weighted Average Exercise Price, Lapsed and Forfeited | $ / shares | 34.93 |
Weighted Average Exercise Price, Options outstanding, End of Period | $ / shares | 33.72 |
Weighted Average Exercise Price, Option vested and expected to vest, June 30, 2016 | $ / shares | 33.79 |
Weighted Average Exercise Price, Options exercisable, June 30, 2016 | $ / shares | $ 35.38 |
Weighted Average Remaining Life, Options outstanding, June 30, 2016 | 4 years 10 months 7 days |
Weighted Average Remaining Life, Options vested and expected to vest, June 30, 2016 | 4 years 9 months 24 days |
Weighted Average Remaining Life, Options exercisable, June 30, 2016 | 2 years 8 months 11 days |
Aggregate Intrinsic value, Options outstanding, June 30, 2016 | $ | $ 602 |
Aggregate Intrinsic Value, Options vested and expected to vest, June 30, 2016 | $ | 589 |
Aggregate Intrinsic Value, Options exercisable, June 30, 2016 | $ | $ 89 |
Stock-Based Compensation - Ch97
Stock-Based Compensation - Changes in Restricted Stock Units (Details) | 12 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Restricted Stock Units - Performance Vesting [Member] | |
Changes in Restricted Stock Units | |
Unvested Performance Vesting and Time Vesting Restricted Stock Units, Beginning of Period, Shares | shares | 101,245 |
Granted, Shares | shares | 117,589 |
Vested, Shares | shares | 0 |
Performance Metric Not Achieved | shares | (42,697) |
Forfeited, Shares | shares | (60,670) |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value | $ / shares | $ 32.70 |
Unvested Performance Vesting and Time Vesting Restricted Stock Units End of Period | shares | 115,467 |
Weighted Average Fair Value, Unvested Restricted Stock Units, Beginning of Period | $ / shares | $ 43 |
Weighted Average Fair Value, Granted | $ / shares | 31.60 |
Weighted Average Fair Value, Vested | $ / shares | 0 |
Performance Metric Not Achieved, Weighted Average Exercise Price | $ / shares | 31.60 |
Weighted Average Fair Value, Unvested Restricted Stock Units, End of Period | $ / shares | $ 36.96 |
Restricted Stock Units - Time Vesting [Member] | |
Changes in Restricted Stock Units | |
Unvested Performance Vesting and Time Vesting Restricted Stock Units, Beginning of Period, Shares | shares | 689,268 |
Granted, Shares | shares | 760,443 |
Vested, Shares | shares | (300,191) |
Forfeited, Shares | shares | (134,776) |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value | $ / shares | $ 35.80 |
Unvested Performance Vesting and Time Vesting Restricted Stock Units End of Period | shares | 1,014,744 |
Weighted Average Fair Value, Unvested Restricted Stock Units, Beginning of Period | $ / shares | $ 41.53 |
Weighted Average Fair Value, Granted | $ / shares | 27.46 |
Weighted Average Fair Value, Vested | $ / shares | 40.68 |
Weighted Average Fair Value, Unvested Restricted Stock Units, End of Period | $ / shares | $ 31.97 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Stock-Based Compensation (Additional Textual) [Abstract] | |||
Maximum period of achievement of performance goals to earn performance units | 3 years | ||
Minimum performance period of individual required to earn performance units | 3 years | ||
Stock Option [Member] | |||
Stock-Based Compensation (Textual) [Abstract] | |||
Compensation expense related to stock option | $ 3.3 | $ 3.2 | $ 4.3 |
Unrecognized compensation cost | $ 2.5 | ||
Unrecognized compensation costs, weighted average period | 1 year 11 months | ||
Weighted average fair value of options granted | $ 6.45 | $ 10.16 | $ 13.76 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | $ 2.3 | $ 7.6 | $ 5.1 |
Tax benefits resulting from stock-based compensation deductions in excess of amounts reported for financial reporting purposes | (1.9) | 1.3 | 6 |
Cash received from the exercise of capital stock option | 1 | 11.7 | 20.6 |
Tax benefit from the exercise of capital stock option | 2 | 4.6 | |
Total Intrinsic value of options exercised | 5.3 | 14.8 | |
Restricted Stock Units - Time Vesting Performance Vesting [Member] | |||
Stock-Based Compensation (Textual) [Abstract] | |||
Compensation expense related to stock option | 14.6 | $ 13.5 | $ 13.1 |
Unrecognized compensation cost | $ 14.1 | ||
Unrecognized compensation costs, weighted average period | 2 years 1 month 10 days |
Environmental Matters (Details)
Environmental Matters (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Jun. 30, 2015 |
Environmental Remediation Obligations [Abstract] | ||
Accrual for Potential Environmental Loss Contingencies | $ 12.5 | $ 12.6 |
Commitments and Contingencies -
Commitments and Contingencies - Future Minimum Lease Payments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Lease Expense Under Rental | $ 28.6 | $ 29.4 | $ 31.9 |
Future Minimum Operating Lease Payment For Year 2016 | 18.6 | ||
Future Minimum Operating Lease Payment For Year 2017 | 13 | ||
Future Minimum Operating Lease Payment For Year 2018 | 9.9 | ||
Future Minimum Operating Lease Payment For Year 2019 | 8 | ||
Future Minimum Operating Lease Payment For Year 2020 | 6.8 | ||
Future Minimum Operating Lease Payment Due Thereafter | $ 20.9 |
Segment Data (Details)
Segment Data (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Segment Reporting Information [Line Items] | |||
Total External Sales | $ 2,098,436 | $ 2,647,195 | $ 2,837,190 |
Total operating (loss) income | (174,943) | (357,823) | 263,432 |
Interest expense | 27,752 | 31,466 | 32,451 |
Other (income) expense, net | (4,124) | (1,674) | 2,172 |
(Loss) income before income taxes | (198,571) | (387,615) | 228,809 |
Depreciation and Amortization | 117,466 | 131,664 | 130,222 |
Equity Income | (10) | 6 | 84 |
Assets | 2,368,793 | 2,849,529 | 3,868,086 |
Capital Expenditures | 110,697 | 100,939 | 117,376 |
Investments in Affiliated Companies | 2 | 361 | 495 |
Industrial [Member] | |||
Segment Reporting Information [Line Items] | |||
Total External Sales | 1,269,162 | 1,461,744 | 1,524,075 |
Total operating (loss) income | 81,243 | 160,894 | 177,040 |
Depreciation and Amortization | 62,942 | 64,188 | 65,820 |
Equity Income | 0 | 0 | 34 |
Assets | 1,215,226 | 1,259,270 | 1,449,688 |
Capital Expenditures | 80,560 | 64,497 | 71,628 |
Investments in Affiliated Companies | 0 | 0 | 0 |
Infrastructure [Member] | |||
Segment Reporting Information [Line Items] | |||
Total External Sales | 829,274 | 1,185,451 | 1,313,115 |
Total operating (loss) income | (246,306) | (509,381) | 94,940 |
Depreciation and Amortization | 54,459 | 67,413 | 64,339 |
Equity Income | (10) | 6 | 50 |
Assets | 849,447 | 1,279,608 | 1,986,724 |
Capital Expenditures | 30,137 | 36,442 | 45,748 |
Investments in Affiliated Companies | 2 | 361 | 495 |
Corporate [Member] | |||
Segment Reporting Information [Line Items] | |||
Total operating (loss) income | (9,880) | (9,336) | (8,548) |
Depreciation and Amortization | 65 | 63 | 63 |
Assets | $ 304,120 | $ 310,651 | $ 431,674 |
Segment Data - Geographic Sales
Segment Data - Geographic Sales Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
External Sales [Abstract] | |||
Total External Sales | $ 2,098,436 | $ 2,647,195 | $ 2,837,190 |
Total Assets [Abstract] | |||
Assets | 2,368,793 | 2,849,529 | 3,868,086 |
UNITED STATES | |||
External Sales [Abstract] | |||
Total External Sales | 897,399 | 1,176,622 | 1,198,541 |
Total Assets [Abstract] | |||
Assets | 1,075,330 | 1,338,594 | 1,842,453 |
GERMANY | |||
External Sales [Abstract] | |||
Total External Sales | 334,366 | 442,009 | 511,209 |
Total Assets [Abstract] | |||
Assets | 327,679 | 394,491 | 538,661 |
CHINA | |||
External Sales [Abstract] | |||
Total External Sales | 210,124 | 246,953 | 248,212 |
Total Assets [Abstract] | |||
Assets | 233,200 | 274,774 | 341,949 |
ITALY | |||
External Sales [Abstract] | |||
Total External Sales | 69,821 | 85,530 | 107,511 |
Total Assets [Abstract] | |||
Assets | 50,352 | 94,978 | 178,141 |
FRANCE | |||
External Sales [Abstract] | |||
Total External Sales | 56,264 | 59,772 | 63,473 |
UNITED KINGDOM | |||
External Sales [Abstract] | |||
Total External Sales | 50,723 | 70,600 | 105,041 |
Total Assets [Abstract] | |||
Assets | 48,507 | 71,342 | 79,657 |
INDIA | |||
External Sales [Abstract] | |||
Total External Sales | 77,934 | 85,193 | 81,455 |
Total Assets [Abstract] | |||
Assets | 91,544 | 97,463 | 94,897 |
CANADA | |||
External Sales [Abstract] | |||
Total External Sales | 55,812 | 73,912 | 78,163 |
Total Assets [Abstract] | |||
Assets | 57,174 | 60,492 | 133,481 |
Other | |||
External Sales [Abstract] | |||
Total External Sales | 345,993 | 406,604 | 443,585 |
Total Assets [Abstract] | |||
Assets | 295,509 | 323,256 | 393,919 |
SWITZERLAND | |||
Total Assets [Abstract] | |||
Assets | $ 189,498 | $ 194,139 | $ 264,928 |
Segment Data Segment Data - Sal
Segment Data Segment Data - Sales by End Market (Details) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Revenue from External Customer [Line Items] | |||
Sales by End Market | 100.00% | 100.00% | 100.00% |
General Engineering [Member] | |||
Revenue from External Customer [Line Items] | |||
Sales by End Market | 38.00% | 36.00% | 31.00% |
Transportation [Member] | |||
Revenue from External Customer [Line Items] | |||
Sales by End Market | 21.00% | 21.00% | 21.00% |
Energy [Member] | |||
Revenue from External Customer [Line Items] | |||
Sales by End Market | 17.00% | 19.00% | 23.00% |
Earthworks [Member] | |||
Revenue from External Customer [Line Items] | |||
Sales by End Market | 16.00% | 17.00% | 19.00% |
Aerospace and Defense [Member] | |||
Revenue from External Customer [Line Items] | |||
Sales by End Market | 8.00% | 7.00% | 6.00% |
Segment Data - Narrative (Detai
Segment Data - Narrative (Details) $ in Millions | 12 Months Ended | ||
Jun. 30, 2016USD ($)Segment | Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | |
Segment Data [Abstract] | |||
Operations in Number of Global Reporting Segments | Segment | 2 | ||
Sales To a Single Customer Did Not Aggretage More Than | 0.04 | ||
Export Sales from U.S. Operations to Unaffiliated Customers | $ | $ 65.3 | $ 71 | $ 82.2 |
Selected Quarterly Financial105
Selected Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||
Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | ||||||||
Quarterly Financial Data [Abstract] | |||||||||||||||||
Sales | $ 497,837 | $ 524,021 | $ 555,354 | $ 637,653 | $ 638,970 | $ 675,631 | $ 694,941 | $ 2,098,436 | $ 2,647,195 | $ 2,837,190 | |||||||
Gross profit | 157,353 | 140,806 | 151,224 | 188,966 | 199,470 | 199,458 | 218,009 | 616,067 | 805,993 | 897,003 | |||||||
Net (loss) income attributable to Kennametal | $ 16,000 | $ (169,227) | $ (6,226) | $ 21,146 | $ (46,229) | $ (388,302) | $ 39,489 | $ (225,968) | $ (373,896) | $ 158,366 | |||||||
Basic (loss) earnings per share attributable to Kennametal | $ 0.20 | [1] | $ (2.12) | [1] | $ (0.08) | [1] | $ 0.27 | [1] | $ (0.58) | [1] | $ (4.89) | [1] | $ 0.50 | [1] | $ (2.83) | $ (4.71) | $ 2.01 |
Diluted (loss) earnings per share attributable to Kennametal | $ 0.20 | [1] | $ (2.12) | [1] | $ (0.08) | [1] | $ 0.26 | [1] | $ (0.58) | [1] | $ (4.89) | [1] | $ 0.49 | [1] | $ (2.83) | $ (4.71) | $ 1.99 |
[1] | Earnings per share amounts attributable to Kennametal for each quarter are computed using the weighted average number of shares outstanding during the quarter. Earnings per share amounts attributable to Kennametal for the full year are computed using the weighted average number of shares outstanding during the year. Thus, the sum of the four quarters’ earnings per share attributable to Kennametal does not always equal the full-year earnings per share attributable to Kennametal. |
Schedule II Valuation and Qu106
Schedule II Valuation and Qualifying Accounts and Reserves (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Allowance for Doubtful Accounts [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at Beginning of Year | $ 13,560 | $ 14,027 | $ 11,949 |
Charges to Costs and Expenses | 4,827 | 3,602 | 2,880 |
Charged to Other Comprehensive (Loss) Income | 0 | 0 | 0 |
Recoveries | 31 | 40 | 207 |
Other Adjustments | (601) | (1,095) | 111 |
Deductions from Reserves | (5,093) | (3,014) | (1,120) |
Balance at End of Year | 12,724 | 13,560 | 14,027 |
Reserve for Excess and Obsolete Inventory [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at Beginning of Year | 45,020 | 52,737 | 52,739 |
Charges to Costs and Expenses | 5,393 | 8,666 | 9,252 |
Charged to Other Comprehensive (Loss) Income | 0 | 0 | 0 |
Recoveries | 0 | 0 | 0 |
Other Adjustments | (3,372) | (5,613) | 1,317 |
Deductions from Reserves | (10,328) | (10,770) | (10,571) |
Balance at End of Year | 36,713 | 45,020 | 52,737 |
Deferred Tax Asset Valuation Allowance [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at Beginning of Year | 16,771 | 17,860 | 15,569 |
Charges to Costs and Expenses | 85,361 | 1,846 | 3,001 |
Charged to Other Comprehensive (Loss) Income | 24,666 | 0 | 24 |
Recoveries | 0 | 0 | 0 |
Other Adjustments | (4,099) | (2,935) | 505 |
Deductions from Reserves | 0 | 0 | (1,239) |
Balance at End of Year | $ 122,699 | $ 16,771 | $ 17,860 |