Document and Entity Information
Document and Entity Information | 3 Months Ended |
Dec. 31, 2015shares | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | MATTHEWS INTERNATIONAL CORP |
Entity Central Index Key | 63,296 |
Current Fiscal Year End Date | --09-30 |
Entity Well-known Seasoned Issuer | Yes |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 33,016,114 |
Document Fiscal Year Focus | 2,016 |
Document Fiscal Period Focus | Q1 |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2015 |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Dec. 31, 2015 | Sep. 30, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 65,106 | $ 72,196 |
Restricted cash | 12,925 | 12,925 |
Accounts receivable, net | 268,071 | 283,963 |
Inventories | 171,633 | 171,423 |
Other current assets | 66,833 | 64,394 |
Total current assets | 584,568 | 604,901 |
Investments | 25,878 | 25,517 |
Property, plant and equipment: Cost | 518,798 | 501,595 |
Less accumulated depreciation | (292,026) | (274,187) |
Property, plant, and equipment, net | 226,772 | 227,408 |
Deferred income taxes | 13,190 | 20,691 |
Other assets | 15,576 | 13,773 |
Goodwill | 851,474 | 855,728 |
Other intangible assets, net | 408,742 | 415,000 |
Total assets | 2,126,200 | 2,163,018 |
Current liabilities: | ||
Long-term debt, current maturities | 12,389 | 11,737 |
Trade accounts payable | 62,788 | 68,896 |
Accrued compensation | 45,802 | 63,931 |
Accrued income taxes | 12,040 | 11,448 |
Other current liabilities | 90,437 | 92,731 |
Total current liabilities | 223,456 | 248,743 |
Long-term debt | 901,460 | 891,217 |
Accrued pension | 97,082 | 95,753 |
Postretirement benefits | 19,356 | 19,415 |
Deferred income taxes | 137,791 | 144,705 |
Other liabilities | 27,326 | 29,139 |
Total liabilities | 1,406,471 | 1,428,972 |
Shareholders' equity-Matthews: | ||
Common stock | 36,334 | 36,334 |
Additional paid-in capital | 108,730 | 115,890 |
Retained earnings | 843,655 | 843,955 |
Accumulated other comprehensive loss | (157,711) | (150,326) |
Treasury stock, at cost | (112,907) | (115,033) |
Total shareholders' equity-Matthews | 718,101 | 730,820 |
Noncontrolling interests | 1,628 | 3,226 |
Total shareholders' equity | 719,729 | 734,046 |
Total liabilities and shareholders' equity | $ 2,126,200 | $ 2,163,018 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) [Abstract] | ||
Sales | $ 354,232 | $ 343,584 |
Cost of sales | (227,665) | (218,914) |
Gross profit | 126,567 | 124,670 |
Selling and administrative expenses | (114,529) | (99,085) |
Operating profit | 12,038 | 25,585 |
Investment income | 701 | 271 |
Interest expense | (5,840) | (5,333) |
Other income (deductions), net | (874) | (1,304) |
Income before income taxes | 6,025 | 19,219 |
Income taxes | (1,522) | (4,974) |
Net income | 4,503 | 14,245 |
Net loss attributable to noncontrolling interests | 111 | 115 |
Net income attributable to Matthews shareholders | $ 4,614 | $ 14,360 |
Earnings per share attributable to Matthews shareholders: | ||
Basic (in dollars per share) | $ 0.14 | $ 0.44 |
Diluted (in dollars per share) | $ 0.14 | $ 0.43 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Net income (loss): | $ 4,503 | $ 14,245 |
Other comprehensive (loss) income ("OCI"), net of tax: | ||
Foreign currency translation adjustment | (10,122) | (26,292) |
Pension plans and other postretirement benefits | 1,102 | 925 |
Unrecognized gain (loss) on derivatives: | ||
Net change from periodic revaluation | 1,076 | (1,468) |
Net amount reclassified to earnings | 506 | 657 |
Net change in unrecognized gain (loss) on derivatives | 1,582 | (811) |
Other comprehensive loss, net of tax | (7,438) | (26,178) |
Total comprehensive loss | (2,935) | (11,933) |
Matthews [Member] | ||
Net income (loss): | 4,614 | 14,360 |
Other comprehensive (loss) income ("OCI"), net of tax: | ||
Foreign currency translation adjustment | (10,069) | (26,282) |
Pension plans and other postretirement benefits | 1,102 | 925 |
Unrecognized gain (loss) on derivatives: | ||
Net change from periodic revaluation | 1,076 | (1,468) |
Net amount reclassified to earnings | 506 | 657 |
Net change in unrecognized gain (loss) on derivatives | 1,582 | (811) |
Other comprehensive loss, net of tax | (7,385) | (26,168) |
Total comprehensive loss | (2,771) | (11,808) |
Noncontrolling Interest [Member] | ||
Net income (loss): | (111) | (115) |
Other comprehensive (loss) income ("OCI"), net of tax: | ||
Foreign currency translation adjustment | (53) | (10) |
Pension plans and other postretirement benefits | 0 | 0 |
Unrecognized gain (loss) on derivatives: | ||
Net change from periodic revaluation | 0 | 0 |
Net amount reclassified to earnings | 0 | 0 |
Net change in unrecognized gain (loss) on derivatives | 0 | 0 |
Other comprehensive loss, net of tax | (53) | (10) |
Total comprehensive loss | $ (164) | $ (125) |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive (Loss) Income [Member] | Treasury Stock [Member] | Non-controlling Interests [Member] | Total |
Balance at Sep. 30, 2014 | $ 36,334 | $ 113,225 | $ 798,353 | $ (66,817) | $ (109,950) | $ 4,061 | $ 775,206 |
Net income (loss) | 0 | 0 | 14,360 | 0 | 0 | (115) | 14,245 |
Minimum pension liability | 0 | 0 | 0 | 925 | 0 | 0 | 925 |
Translation adjustment | 0 | 0 | 0 | (26,282) | 0 | (10) | (26,292) |
Fair value of derivatives | 0 | 0 | 0 | (811) | 0 | 0 | (811) |
Total comprehensive loss | (11,933) | ||||||
Stock-based compensation | 0 | 2,525 | 0 | 0 | 0 | 2,525 | |
Purchase of treasury stock | 0 | 0 | 0 | 0 | (8,016) | 0 | (8,016) |
Issuance of treasury stock | 0 | (6,164) | 0 | 0 | 9,753 | 0 | 3,589 |
Cancellation of treasury stock | 1,201 | (1,201) | |||||
Dividends | 0 | 0 | (4,302) | 0 | 0 | 0 | (4,302) |
Balance at Dec. 31, 2014 | 36,334 | 110,787 | 808,411 | (92,985) | (109,414) | 3,936 | 757,069 |
Balance at Sep. 30, 2015 | 36,334 | 115,890 | 843,955 | (150,326) | (115,033) | 3,226 | 734,046 |
Net income (loss) | 0 | 0 | 4,614 | 0 | 0 | (111) | 4,503 |
Minimum pension liability | 0 | 0 | 0 | 1,102 | 0 | 0 | 1,102 |
Translation adjustment | 0 | 0 | 0 | (10,069) | 0 | (53) | (10,122) |
Fair value of derivatives | 0 | 0 | 0 | 1,582 | 0 | 0 | 1,582 |
Total comprehensive loss | (2,935) | ||||||
Stock-based compensation | 0 | 2,526 | 0 | 0 | 0 | 2,526 | |
Purchase of treasury stock | 0 | 0 | 0 | 0 | (6,730) | 0 | (6,730) |
Issuance of treasury stock | 0 | (6,959) | 0 | 0 | 8,856 | 0 | 1,897 |
Dividends | 0 | 0 | (4,914) | 0 | 0 | 0 | (4,914) |
Acquisition of noncontrolling interest | 0 | (2,727) | 0 | 0 | 0 | (1,434) | (4,161) |
Balance at Dec. 31, 2015 | $ 36,334 | $ 108,730 | $ 843,655 | $ (157,711) | $ (112,907) | $ 1,628 | $ 719,729 |
CONSOLIDATED STATEMENTS OF SHA6
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) [Abstract] | ||
Purchase of treasury stock, shares (in shares) | 120,156 | 173,749 |
Issuance of treasury stock, shares (in shares) | 213,370 | 303,214 |
Cancellation of treasury stock, shares (in shares) | 32,739 | |
Dividends, per share (in dollars per share) | $ 0.15 | $ 0.13 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | ||
Net income | $ 4,503 | $ 14,245 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 15,748 | 15,428 |
Stock-based compensation expense | 2,526 | 2,525 |
Changes in deferred taxes | (629) | (7,605) |
Gain on sale of assets | (206) | (31) |
Unrealized gain on investments | (424) | 0 |
Changes in working capital items | (12,486) | (12,982) |
Increase in other assets | (1,703) | (98) |
Decrease in other liabilities | (87) | (1,395) |
Increase in pension and postretirement benefits | 3,041 | 1,945 |
Other, net | (264) | (3,609) |
Net cash provided by operating activities | 10,019 | 8,423 |
Cash flows from investing activities: | ||
Capital expenditures | (14,158) | (9,268) |
Proceeds from sale of assets | 849 | 629 |
Proceeds from sale of subsidiary | 0 | 10,418 |
Net cash (used in) provided by investing activities | (13,309) | 1,779 |
Cash flows from financing activities: | ||
Proceeds from long-term debt | 21,634 | 10,928 |
Payments on long-term debt | (10,366) | (17,925) |
Proceeds from the exercise of stock options | 1,798 | 3,727 |
Purchases of treasury stock | (6,730) | (8,016) |
Dividends | (4,914) | (4,302) |
Transaction with noncontrolling interest | (4,161) | 0 |
Net cash used in financing activities | (2,739) | (15,588) |
Effect of exchange rate changes on cash | (1,061) | (1,603) |
Net change in cash and cash equivalents | $ (7,090) | $ (6,989) |
Nature of Operations
Nature of Operations | 3 Months Ended |
Dec. 31, 2015 | |
Nature of Operations [Abstract] | |
Nature of Operations | Note 1. Nature of Operations Matthews International Corporation ("Matthews" or the "Company"), founded in 1850 and incorporated in Pennsylvania in 1902, is a global provider of brand solutions, memorialization products and industrial automation solutions. Brand solutions include brand development, deployment and delivery (consisting of brand management, printing plates and cylinders, pre-media services and imaging services for consumer packaged goods and retail customers, merchandising display systems, and marketing and design services). Memorialization products consist primarily of bronze and granite memorials and other memorialization products, caskets and cremation equipment primarily for the cemetery and funeral home industries. Industrial automation solutions include marking and coding equipment and consumables, industrial automation products and order fulfillment systems for identifying, tracking, picking and conveying consumer and industrial products. The Company has production and marketing facilities in the United States, Central and South America, Canada, Europe, Australia and Asia. |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Dec. 31, 2015 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | Note 2. Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information for commercial and industrial companies and the instructions to Form 10‑Q and Rule 10‑01 of Regulation S‑X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation have been included. Operating results for the three months ended December 31, 2015 are not necessarily indicative of the results that may be expected for the fiscal year ending September 30, 2016. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10‑K for the year ended September 30, 2015. The consolidated financial statements include all domestic and foreign subsidiaries in which the Company maintains an ownership interest and has operating control. All intercompany accounts and transactions have been eliminated. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. New Accounting Pronouncement: Issued and Adopted In November 2015, the Financial Accounting Standards Board issued new guidance intended to simplify the presentation of deferred income taxes in a classified statement of financial position. The new deferred income tax guidance requires that all deferred income tax balances be classified as non-current assets and liabilities on the classified statement of financial position. The Company has chosen to early-adopt this standard for the quarter ended December 31, 2015, and retrospectively adjust the prior period presentation to conform to the new standard. The adjustment totaled $19,753 in current deferred tax assets and $340 in current deferred tax liabilities being reclassified as non-current deferred tax assets and liabilities, respectively, in the September 30, 2015 Consolidated Balance Sheet. Reclassification and Revision: Amounts presented for the quarter ended December 31, 2014 have been revised to reflect additional expense related to a theft of funds by an employee that had occurred over a multi-year period. The following table reconciles the effect of the adjustments to the previously reported Consolidated Statement of Income for the three month period ended December 31, 2014: Three months ended December 31, 2014 Previously Reported Adjustment As Adjusted Consolidated Statement of Income Other deductions, net $ (435 ) $ (869 ) $ (1,304 ) Income before income taxes 20,088 (869 ) 19,219 Income taxes (5,252 ) 278 (4,974 ) Net income 14,836 (591 ) 14,245 Net income attributable to Matthews shareholders 14,951 (591 ) 14,360 Comprehensive loss (11,342 ) (591 ) (11,933 ) Earnings per share attributable to Matthews shareholders: Basic 0.45 (0.01 ) 0.44 Diluted 0.45 (0.02 ) 0.43 The following table reconciles the effect of the adjustments to the previously reported Consolidated Statement of Cash Flows for the three month period ended December 31, 2014: Three months ended December 31, 2014 Previously Reported Adjustment As Adjusted Consolidated Statement of Cash Flows Net income $ 14,836 $ (591 ) $ 14,245 Changes in working capital items (12,704 ) (278 ) (12,982 ) Net cash provided by operating activities 9,292 (869 ) 8,423 Net change in cash and cash equivalents (6,120 ) (869 ) (6,989 ) There was no impact to the Consolidated Statement of Comprehensive Income or the Consolidated Statement of Shareholders' Equity for the three months ended December 31, 2014 other than the impact on Net Income. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Dec. 31, 2015 | |
Fair Value Measurements [Abstract] | |
Fair Value Measurements | Note 3. 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. A three level fair value hierarchy is used to prioritize the inputs used in valuations, as defined below: Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities in active markets. Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly or indirectly. Level 3: Unobservable inputs for the asset or liability. The fair values of the Company's assets and liabilities measured on a recurring basis are categorized as follows: December 31, 2015 September 30, 2015 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Derivatives (1) $ - $ 125 $ - $ 125 $ - $ - $ - $ - Trading securities 18,868 - - $ 18,868 18,444 - - 18,444 Total assets at $ 18,868 $ 125 $ - $ 18,993 $ 18,444 $ - $ - $ 18,444 Liabilities: Derivatives (1) $ - $ 1,217 $ - $ 1,217 $ - $ 3,686 $ - $ 3,686 Total liabilities at fair value $ - $ 1,217 $ - $ 1,217 $ - $ 3,686 $ - $ 3,686 (1) Interest rate swaps are valued based on observable market swap rates and are classified within Level 2 of the fair value hierarchy. |
Inventories
Inventories | 3 Months Ended |
Dec. 31, 2015 | |
Inventories [Abstract] | |
Inventories | Note 4. Inventories Inventories consisted of the following: December 31, 2015 September 30, 2015 Raw materials $ 50,624 $ 48,636 Work in process 34,977 32,567 Finished goods 86,032 90,220 $ 171,633 $ 171,423 |
Debt
Debt | 3 Months Ended |
Dec. 31, 2015 | |
Debt [Abstract] | |
Debt | Note 5. Debt The Company has a domestic Revolving Credit Facility with a syndicate of financial institutions. The maximum amount of borrowings available under the facility is $900,000 and borrowings under the facility bear interest at LIBOR plus a factor ranging from .75% to 2.00% The Revolving Credit Facility requires the Company to maintain certain leverage and interest coverage ratios. A portion of the facility (not to exceed $30,000) is available for the issuance of trade and standby letters of credit. Outstanding borrowings on the Revolving Credit Facility at December 31, 2015 and September 30, 2015 were $872,425 and $857,425, respectively. The weighted-average interest rate on outstanding borrowings at December 31, 2015 and 2014 was 2.31% and 2.51%, respectively. The Company has entered into the following interest rate swaps: Effective Date Amount Fixed Interest Rate Interest Rate Spread at December 31, 2015 Maturity Date June 2012 $40,000 1.88% 1.75% June 2022 August 2012 35,000 1.74% 1.75% June 2022 September 2012 25,000 1.24% 1.75% March 2017 May 2014 25,000 1.35% 1.75% May 2018 November 2014 25,000 1.26% 1.75% June 2018 March 2015 25,000 1.49% 1.75% March 2019 September 2015 25,000 1.39% 1.75% September 2020 November 2015 25,000 1.32% 1.75% November 2020 December 2015 25,000 1.59% 1.75% December 2020 The Company enters into interest rate swaps in order to achieve a mix of fixed and variable rate debt that it deems appropriate. The interest rate swaps have been designated as cash flow hedges of the future variable interest payments under the Revolving Credit Facility, which are considered probable of occurring. Based on the Company's assessment, all of the critical terms of each of the hedges matched the underlying terms of the hedged debt and related forecasted interest payments, and as such, these hedges were considered highly effective. The fair value of the interest rate swaps reflected an unrealized loss, net of unrealized gains, at December 31, 2015 and an unrealized loss, net of unrealized gains, of $3,686 ($2,248 after tax) at September 30, 2015. The net unrealized gain and loss are included in shareholders' equity as part of accumulated other comprehensive income ("AOCI"). Assumi in AOCI is expected to be recognized in earnings over the next twelve months. At December 31, 2015 and September 30, 2015, the interest rate swap contracts were reflected in the consolidated balance sheets as follows: Derivatives December 31, 2015 September 30, 2015 Current assets: Other current assets $ 26 $ - Long-term assets: Other assets 99 - Current liabilities: Other current liabilities (420 ) (1,165 ) Long-term liabilities: Other liabilities (797 ) (2,521 ) Total derivatives $ (1,092 ) $ (3,686 ) The loss recognized on derivatives was as follows: Location of Derivatives in Loss Amount of Loss Cash Flow Recognized in Recognized in Income Hedging Income on on Derivatives Relationships Derivative Three Months Ended December 31, 2015 2014 Interest rate swaps Interest expense $(830) $(1,077) The Company recognized the AOCI: Location of Gain or (Loss) Reclassified Amount of Loss Amount of Gain or (Loss) from Reclassified from Derivatives in Recognized in AOCI into AOCI into Income Cash Flow AOCI on Derivatives Income (Effective Portion*) Hedging Relationships December 31, December 31, (Effective Portion*) December 31, 2015 December 31, Interest rate swaps $1,076 $(1,468) Interest expense $(506) $(657) *There is no ineffective portion or amount excluded from effectiveness testing. The Company, through certain of its European subsidiaries, has a credit facility with a European bank. The maximum amount of %, respectively. The Company, through its German subsidiary, Saueressig GmbH & Co. KG ("Saueressig"), has several loans with various European banks. Outstanding borrowings under these loans and 734,452 Euros ($824) at December 31, 2015 and September 30, 2015, respectively. The weighted-average interest rate on outstanding borrowings of Saueressig at December 31, 2015 and 2014 was and 4.24%, respectively. The Company, through its German subsidiary, Wetzel GmbH ("Wetzel"), has several loans with various European banks. Outstanding borrowings on these loans and 1.9 million Euros ($2,110) at December 31, 2015 and September 30, 2015, respectively. The weighted-average interest rate on outstanding borrowings of Wetzel at December 31, 2015 and 2014 5.74%, respectively. The Company, through its wholly-owned subsidiary, Matthews International S.p.A., has several loans with various Italian banks. %, respectively. In September 2014, a claim seeking to draw upon a letter of credit issued by the Company of $12,925 was filed with respect to a project for a customer. In January 2015, the Company made payment on the draw to the financial institution for the letter of credit. Pursuant to an action initiated by the Company, a court order has been issued requiring these funds to ultimately be remitted to the court pending resolution of the dispute between the parties. While it is possible the resolution of this matter could be unfavorable to the Company, management has assessed the customer's claim to be without merit and, based on information available as of this filing, expects that the ultimate resolution of this matter will not have a material adverse effect on Matthews' financial condition, results of operations or cash flows. As of December 31, 2015 and September 30, 2015, the Company has presented the funded letter of credit as restricted cash on the Consolidated Balance Sheet. As of December 31, 2015 and September 30, 2015 the fair value of the Company's long-term debt, including current maturities, approximated the carrying value included in the Consolidated Balance Sheet. |
Share-Based Payments
Share-Based Payments | 3 Months Ended |
Dec. 31, 2015 | |
Share-Based Payments [Abstract] | |
Share-Based Payments | Note 6. Share-Based Payments The Company maintains an equity incentive plan (the "2012 Equity Incentive Plan") that provides for grants of stock options, restricted shares, stock-based performance units and certain other types of stock-based awards. The Company also maintains an equity incentive plan (the "2007 Equity Incentive Plan") and a stock incentive plan (the "1992 Incentive Stock Plan") that previously provided for grants of stock options, restricted shares and certain other types of stock-based awards. Under the 2012 Equity Incentive Plan, which has a ten-year term, the maximum number of shares available for grants or awards is an aggregate of 2,500,000. There will be no further grants under the 2007 Equity Incentive Plan or the 1992 Incentive Stock Plan. At December 31, 2015, there were reserved for future issuance under the 2012 Equity Incentive Plan. All plans are administered by the Compensation Committee of the Board of Directors. The option price for each stock option granted under any of the plans may not be less than the fair market value of the Company's Class A Common Stock on the date of grant. Outstanding stock options are generally exercisable in one-third increments upon the attainment of pre-defined levels of appreciation in the market value of the Company's Class A Common Stock. In addition, options generally vest in one-third increments after three, four and five years, respectively, from the grant date (but, in any event, not until the attainment of the market value thresholds). The options expire on the earlier of ten years from the date of grant, upon employment termination, or within specified time limits following voluntary employment termination (with the consent of the Company), retirement or death. The Company generally settles employee stock option exercises with treasury shares. With respect to outstanding restricted share grants, for grants made prior to fiscal 2013, generally one-half of the shares vest on the third anniversary of the grant, with the remaining one-half of the shares vesting in one-third increments upon attainment of pre-defined levels of appreciation in the market value of the Company's Class A Common Stock. For grants made in and after fiscal 2013, generally one-half of the shares vest on the third anniversary of the grant, one-quarter of the shares vest in one-third increments upon the attainment of pre-defined levels of adjusted earnings per share, and the remaining one-quarter of the shares vest in one-third increments upon attainment of pre-defined levels of appreciation in the market value of the Company's Class A Common Stock. Additionally, restricted shares cannot vest until the first anniversary of the grant date. Unvested restricted shares generally expire on the earlier of five years from the date of grant, upon employment termination, or within specified time limits following voluntary employment termination (with the consent of the Company), retirement or death. The Company issues restricted shares from treasury shares. For the three-month periods ended December 31, 2015 and 2014, total stock-based compensation cost total periods ended December 31, 2015 and 2014. For the three-month periods ended December 31, 2015 and 2014, the amount of cash received from the exercise of stock options $315, respectively. The transactions for restricted stock for the three months ended December 31, 2015 were as follows: Weighted- average grant-date Shares fair value Non-vested at September 30, 2015 570,567 $33.66 Granted 213,370 52.08 Vested (249,340 ) 29.94 Expired or forfeited (2,785 ) 36.89 Non-vested at December 31, 2015 531,812 44.93 As of December 31, 2015, the total unrecognized compensation cost related to unvested restricted stock and is expected to be recognized over a weighted average period of . The transactions for shares under options for the quarter ended December 31, 2015 were as follows: Weighted- Weighted- average Aggregate average remaining intrinsic Shares exercise price contractual term value Outstanding, September 30, 2015 337,938 $39.19 Exercised (47,834 ) 37.59 Expired or forfeited (98,745 ) 37.33 Outstanding, December 31, 2015 191,359 40.56 0.9 $2,468 Exercisable, December 31, 2015 114,193 40.56 0.9 $1,473 No options vested during the three months ended December 31, 2015 and 2014, respectively. The intrinsic value of options (which is the amount by which the stock price exceeded the exercise price of the options on the date of exercise) exercised during the three-month periods ended December 31, 2015 and 2014 $841, respectively. The transactions for non-vested options for the quarter ended December 31, 2015 were as follows: Weighted-average grant-date Non-vested shares Shares fair value Non-vested at September 30, 2015 166,406 $12.43 Expired or forfeited (89,240 ) 12.56 Non-vested at December 31, 2015 77,166 12.29 The fair value of each restricted stock grant is estimated on the date of grant using a binomial lattice valuation model. The following table indicates the assumptions used in estimating fair value of restricted stock granted during the periods ended December 31, 2015 and 2014. Three Months Ended December 31, 2015 2014 Expected volatility 20.7 % 22.2 % Dividend yield 1.0 % 1.0 % Average risk-free interest rate 1.7 % 1.7 % Average expected term (years) 2.1 1.8 The risk-free interest rate is based on United States Treasury yields at the date of grant. The dividend yield is based on the most recent dividend payment and average stock price over the 12 months prior to the grant date. Expected volatilities are based on the historical volatility of the Company's stock price. The expected term for grants in the years ended September 30, 2015, 2014 and 2013 represents an estimate of the average period of time for restricted shares to vest. The option characteristics for each grant are considered separately for valuation purposes. The Company maintains the 1994 Director Fee Plan and the 2014 Director Fee Plan (collectively, the "Director Fee Plans"). There will be no further fees or share-based awards granted under the 1994 Director Fee Plan. Under the 2014 Director Fee Plan, non-employee directors (except for the Chairman of the Board) each receive, as an annual retainer fee for fiscal 2016, either cash or shares of the Company's Class A Common Stock with a value equal to $75. The annual retainer fee for fiscal 2016 paid to a non-employee Chairman of the Board Where the annual retainer fee is provided in shares, each director may elect to be paid these shares on a current basis or have such shares credited to a deferred stock account as phantom stock, with such shares to be paid to the director subsequent to leaving the Board. The value of deferred shares is recorded in other liabilities. A total of had been deferred under the Director Fee Plans at December 31, 2015. Additionally, non-employee directors each receive an annual stock-based grant (non-statutory stock options, stock appreciation rights and/or restricted shares) with a value fiscal 2016. A total of options have been granted under the Director Fee Plans. At December 31, 2015, there were . Additionally, shares of restricted stock have been granted under the Director Fee Plans, which were issued under the 2014 Director Fee Plan and are unvested at December 31, 2015. A total of 150,000 shares have been authorized to be issued under the 2014 Director Fee Plan. |
Earnings Per Share Attributable
Earnings Per Share Attributable to Matthews Shareholders | 3 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share Attributable to Matthews Shareholders [Abstract] | |
Earnings Per Share Attributable to Matthews Shareholders | Note 7. Earnings Per Share Attributable to Matthews Shareholders The information used to compute earnings per share attributable to Matthews' common shareholders was as follows: Three Months Ended December 31, 2015 2014 Net income attributable to Matthews shareholders $ 4,614 $ 14,360 Less: dividends and undistributed earnings allocated to participating securities - 5 Net income available to Matthews shareholders $ 4,614 $ 14,365 Weighted-average shares outstanding (in thousands): Basic shares 32,946 32,919 Effect of dilutive securities 249 174 Diluted shares 33,195 33,093 There the three months ended December 31, 2015 or 2014. |
Pension and Other Postretiremen
Pension and Other Postretirement Benefit Plans | 3 Months Ended |
Dec. 31, 2015 | |
Pension and Other Postretirement Benefit Plans [Abstract] | |
Pension and Other Postretirement Benefit Plans | Note 8. Pension and Other Postretirement Benefit Plans The Company provides defined benefit pension and other postretirement plans to certain employees. Net periodic pension and other postretirement benefit cost for the plans included the following: Three Months Ended December 31, Pension Other Postretirement 2015 2014 2015 2014 Service cost $ 1,813 $ 1,655 $ 101 $ 114 Interest cost 2,406 2,145 211 221 Expected return on plan assets (2,407 ) (2,470 ) - - Amortization: Prior service cost (46 ) (45 ) (49 ) (49 ) Net actuarial loss 1,866 1,564 - - Net benefit cost $ 3,632 $ 2,849 $ 263 $ 286 Benefit payments under the Company's principal retirement plan are made from plan assets, while benefit payments under the postretirement benefit plan are made from the Company's operating funds. Under IRS regulations, the Company is not required to make any significant contributions to its principal retirement plan in fiscal year 2016. Contributions made and anticipated for fiscal year 2016 are as follows: Contributions Pension Other Postretirement Contributions during the three months ended December 31, 2015: Supplemental retirement plan $ 181 $ - Other postretirement plan - 451 Additional contributions expected in fiscal 2016: Supplemental retirement plan $ 568 $ - Other postretirement plan - 558 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income | 3 Months Ended |
Dec. 31, 2015 | |
Accumulated Other Comprehensive Income [Abstract] | |
Accumulated Other Comprehensive Income | Note 9. Accumulated Other Comprehensive Income The change in AOCI by component, net of tax, for the three month periods ended December 31, 2015 and 2014 were as follows: Post-retirement benefit plans Currency translation adjustment Derivatives Total Attributable to Matthews: Balance, September 30, 2014 $ (39,651 ) $ (27,367 ) $ 201 $ (66,817 ) OCI before reclassification - (26,282 ) (1,468 ) (27,750 ) Amounts reclassified from AOCI (a) 925 (b) 657 1,582 Net current-period OCI 925 (26,282 ) (811 ) (26,168 ) Balance, December 31, 2014 $ (38,726 ) $ (53,649 ) $ (610 ) $ (92,985 ) Attributable to noncontrolling interest: Balance, September 30, 2014 - $ 516 - $ 516 OCI before reclassification - (10 ) - (10 ) Net current-period OCI - (10 ) - (10 ) Balance, December 31, 2014 - $ 506 - $ 506 Post-retirement benefit plans Currency translation adjustment Derivatives Total Attributable to Matthews: Balance, September 30, 2015 $ (43,474 ) $ (104,604 ) $ (2,248 ) $ (150,326 ) OCI before reclassification - (10,069 ) (b) 1,076 (8,993 ) Amounts reclassified from AOCI (a) 1,102 506 1,608 Net current-period OCI 1,102 (10,069 ) 1,582 (7,385 ) Balance, December 31, 2015 $ (42,372 ) $ (114,673 ) $ (666 ) $ (157,711 ) Attributable to noncontrolling interest: Balance, September 30, 2015 - $ 366 - $ 366 OCI before reclassification - (53 ) - (53 ) Net current-period OCI - (53 ) - (53 ) Balance, December 31, 2015 - $ 313 - $ 313 (a) Amounts were included in net periodic benefit cost for pension and other postretirement benefit plans (see note 8). (b) Amounts were included in interest expense in the periods the hedged item affected earnings (see note 5). Reclassifications out of AOCI for the three month periods ended December 31, 2015 and 2014 were as follows: Amount reclassified from AOCI Details about AOCI Components Three months ended December 31, 2015 Three months ended December 31, 2014 Affected line item in the Statement of income Postretirement benefit plans Prior service (cost) credit $ 95 $ 94 (a) Actuarial losses (1,866 ) (1,564 ) (a) (1,771 ) (1,470 ) (b) Total before tax (669 ) (545 ) Tax provision (benefit) $ (1,102 ) $ (925 ) Net of tax Derivatives Interest rate swap contracts $ (830 ) $ (1,077 ) Interest expense (830 ) (1,077 ) (b) Total before tax (324 ) (420 ) Tax provision (benefit) $ (506 ) $ (657 ) Net of tax (a) Amounts are included in the computation of pension and other postretirement benefit expense, which is reported in both cost of goods sold and selling and administrative expenses. For additional information, see Note 8. (b) For pre-tax items, positive amounts represent income and negative amounts represent expense. |
Income Taxes
Income Taxes | 3 Months Ended |
Dec. 31, 2015 | |
Income Taxes [Abstract] | |
Income Taxes | Note 10. Income Taxes Income tax provisions for the Company's interim periods are based on the effective income tax rate expected to be applicable for the full year. The Company's effective tax rate for the three months ended December 31, 2015 was 25.3%, compared to 25.9% for the three months ended December 31, 2014. The decrease in the effective tax rate for the fiscal 2016 first quarter primarily reflected lower tax rates in certain foreign jurisdictions and the benefit of the recent extension of the U.S. research and development tax credit. Fiscal 2015 reflected the benefit of the utilization of certain tax attributes as a result of legal structure reorganization in foreign jurisdictions. The difference between the Company's fiscal 2016 first quarter effective tax rate and the Federal statutory rate of 35.0% primarily reflected the impact of state taxes, offset by lower foreign income taxes. The Company had unrecognized tax benefits (excluding penalties and interest) of $4,115 The Company classifies interest and penalties on tax uncertainties as a component of the provision for income taxes. The Company is currently under examination in several tax jurisdictions and remains subject to examination until the statute of limitations expires for those tax jurisdictions. As of December 31, 2015, the tax years that remain subject to examination by major jurisdiction generally are: United States – Federal 2012 and forward United States – State 2011 and forward Canada 2010 and forward Europe 2009 and forward United Kingdom 2013 and forward Australia 2011 and forward Asia 2009 and forward |
Segment Information
Segment Information | 3 Months Ended |
Dec. 31, 2015 | |
Segment Information [Abstract] | |
Segment Information | Note 11. Segment Information The Company manages its businesses under three segments: SGK Brand Solutions, Memorialization and Industrial. The SGK Brand Solutions segment includes brand development, deployment and delivery (consisting of brand management, printing plates and cylinders, pre-media services and imaging services for consumer packaged goods and retail customers, merchandising display systems, and marketing and design services). The Memorialization segment consists primarily of bronze and granite memorials and other memorialization products, caskets and cremation equipment primarily for the cemetery and funeral home industries. The Industrial segment includes marking and coding equipment and consumables, industrial automation products and order fulfillment systems for identifying, tracking, picking and conveying consumer and industrial products. Management evaluates segment performance based on operating profit (before income taxes) and does not allocate non-operating items such as investment income, interest expense, other income (deductions), net and noncontrolling interest. Information about the Company's segments follows: Three Months Ended December 31, 2015 2014 Sales to external customers: SGK Brand Solutions $ 178,291 $ 200,834 Memorialization 147,611 116,223 Industrial 28,330 26,527 $ 354,232 $ 343,584 Three Months Ended December 31, 2015 2014 Operating profit: SGK Brand Solutions $ 2,755 $ 1,850 Memorialization 7,689 21,486 Industrial 1,594 2,249 $ 12,038 $ 25,585 |
Acquisitions
Acquisitions | 3 Months Ended |
Dec. 31, 2015 | |
Acquisitions [Abstract] | |
Acquisitions | Note 12. Acquisitions On August 19, 2015, the Company acquired Aurora Products Group, LLC ("Aurora") for $211,604 (net of cash acquired), subject to a working capital adjustment. Aurora provides burial, cremation, and technology products to funeral home clients and distributors in the United States and Canada. The acquisition is designed to expand the Company's memorialization product offerings and geographic distribution footprint in the United States. The preliminary purchase price allocation related to the Aurora acquisition is not finalized as of December 31, 2015, and is based upon a preliminary valuation which is subject to change as the Company obtains additional information, including with respect to fixed assets, intangible assets, certain liabilities and related taxes. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Dec. 31, 2015 | |
Goodwill and Other Intangible Assets [Abstract] | |
Goodwill and Other Intangible Assets | Note 13. Goodwill and Other Intangible Assets A summary of the carrying amount of goodwill attributable to each segment as well as the changes in such amounts are as follows: SGK Brand Solutions Memorialization Industrial Consolidated Goodwill $ 466,647 $ 346,946 $ 52,887 $ 866,480 Accumulated impairment losses (5,752 ) (5,000 ) - (10,752 ) Balance at September 30, 2015 460,895 341,946 52,887 855,728 Additions during period - - - - Translation and other adjustments (4,995 ) 904 (163 ) (4,254 ) Goodwill 461,652 347,850 52,724 862,226 Accumulated impairment losses (5,752 ) (5,000 ) - (10,752 ) Balance at December 31, 2015 $ 455,900 $ 342,850 $ 52,724 $ 851,474 The Company performed its annual impairment review in the second quarter of fiscal 2015 and has determined that estimated fair value for all reporting units exceeded carrying value, therefore no adjustments to the carrying value of goodwill were necessary. The following tables summarize the carrying amounts and related accumulated amortization for intangible assets as of December 31, 2015 and September 30, 2015, respectively. Carrying Accumulated Amount Amortization Net December 31, 2015: Trade names $ 168,467 $ - * $ 168,467 Trade names 1,781 (1,707 ) 74 Customer relationships 285,909 (46,667 ) 239,242 Copyrights/patents/other 11,315 (10,356 ) 959 $ 467,472 $ (58,730 ) $ 408,742 September 30, 2015 Trade names $ 168,467 $ - * $ 168,467 Trade names 1,815 (1,718 ) 97 Customer relationships 296,689 (51,393 ) 245,296 Copyrights/patents/other 11,389 (10,249 ) 1,140 $ 478,360 $ (63,360 ) $ 415,000 * Not subject to amortization The net change in intangible assets during the three months ended December 31, 2015 included the impact of foreign currency fluctuations during the period and additional amortization. Amortization expense on intangible assets was $5,216 |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 3 Months Ended |
Dec. 31, 2015 | |
Basis of Presentation [Abstract] | |
Effects of the adjustments to the previously reported consolidated statements reconciliation | The following table reconciles the effect of the adjustments to the previously reported Consolidated Statement of Income for the three month period ended December 31, 2014: Three months ended December 31, 2014 Previously Reported Adjustment As Adjusted Consolidated Statement of Income Other deductions, net $ (435 ) $ (869 ) $ (1,304 ) Income before income taxes 20,088 (869 ) 19,219 Income taxes (5,252 ) 278 (4,974 ) Net income 14,836 (591 ) 14,245 Net income attributable to Matthews shareholders 14,951 (591 ) 14,360 Comprehensive loss (11,342 ) (591 ) (11,933 ) Earnings per share attributable to Matthews shareholders: Basic 0.45 (0.01 ) 0.44 Diluted 0.45 (0.02 ) 0.43 The following table reconciles the effect of the adjustments to the previously reported Consolidated Statement of Cash Flows for the three month period ended December 31, 2014: Three months ended December 31, 2014 Previously Reported Adjustment As Adjusted Consolidated Statement of Cash Flows Net income $ 14,836 $ (591 ) $ 14,245 Changes in working capital items (12,704 ) (278 ) (12,982 ) Net cash provided by operating activities 9,292 (869 ) 8,423 Net change in cash and cash equivalents (6,120 ) (869 ) (6,989 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Dec. 31, 2015 | |
Fair Value Measurements [Abstract] | |
Fair value of assets and liabilities measured on a recurring basis | The fair values of the Company's assets and liabilities measured on a recurring basis are categorized as follows: December 31, 2015 September 30, 2015 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Derivatives (1) $ - $ 125 $ - $ 125 $ - $ - $ - $ - Trading securities 18,868 - - $ 18,868 18,444 - - 18,444 Total assets at $ 18,868 $ 125 $ - $ 18,993 $ 18,444 $ - $ - $ 18,444 Liabilities: Derivatives (1) $ - $ 1,217 $ - $ 1,217 $ - $ 3,686 $ - $ 3,686 Total liabilities at fair value $ - $ 1,217 $ - $ 1,217 $ - $ 3,686 $ - $ 3,686 (1) Interest rate swaps are valued based on observable market swap rates and are classified within Level 2 of the fair value hierarchy. |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Dec. 31, 2015 | |
Inventories [Abstract] | |
Inventories | Inventories consisted of the following: December 31, 2015 September 30, 2015 Raw materials $ 50,624 $ 48,636 Work in process 34,977 32,567 Finished goods 86,032 90,220 $ 171,633 $ 171,423 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Dec. 31, 2015 | |
Debt [Abstract] | |
Interest rate swaps | The Company has entered into the following interest rate swaps: Effective Date Amount Fixed Interest Rate Interest Rate Spread at December 31, 2015 Maturity Date June 2012 $40,000 1.88% 1.75% June 2022 August 2012 35,000 1.74% 1.75% June 2022 September 2012 25,000 1.24% 1.75% March 2017 May 2014 25,000 1.35% 1.75% May 2018 November 2014 25,000 1.26% 1.75% June 2018 March 2015 25,000 1.49% 1.75% March 2019 September 2015 25,000 1.39% 1.75% September 2020 November 2015 25,000 1.32% 1.75% November 2020 December 2015 25,000 1.59% 1.75% December 2020 |
Derivatives designated as hedging instruments | At December 31, 2015 and September 30, 2015, the interest rate swap contracts were reflected in the consolidated balance sheets as follows: Derivatives December 31, 2015 September 30, 2015 Current assets: Other current assets $ 26 $ - Long-term assets: Other assets 99 - Current liabilities: Other current liabilities (420 ) (1,165 ) Long-term liabilities: Other liabilities (797 ) (2,521 ) Total derivatives $ (1,092 ) $ (3,686 ) |
Loss recognized on derivatives | The loss recognized on derivatives was as follows: Location of Derivatives in Loss Amount of Loss Cash Flow Recognized in Recognized in Income Hedging Income on on Derivatives Relationships Derivative Three Months Ended December 31, 2015 2014 Interest rate swaps Interest expense $(830) $(1,077) The Company recognized the AOCI: Location of Gain or (Loss) Reclassified Amount of Loss Amount of Gain or (Loss) from Reclassified from Derivatives in Recognized in AOCI into AOCI into Income Cash Flow AOCI on Derivatives Income (Effective Portion*) Hedging Relationships December 31, December 31, (Effective Portion*) December 31, 2015 December 31, Interest rate swaps $1,076 $(1,468) Interest expense $(506) $(657) *There is no ineffective portion or amount excluded from effectiveness testing. |
Share-Based Payments (Tables)
Share-Based Payments (Tables) | 3 Months Ended |
Dec. 31, 2015 | |
Share-Based Payments [Abstract] | |
Restricted stock activity | The transactions for restricted stock for the three months ended December 31, 2015 were as follows: Weighted- average grant-date Shares fair value Non-vested at September 30, 2015 570,567 $33.66 Granted 213,370 52.08 Vested (249,340 ) 29.94 Expired or forfeited (2,785 ) 36.89 Non-vested at December 31, 2015 531,812 44.93 |
Stock option activity | The transactions for shares under options for the quarter ended December 31, 2015 were as follows: Weighted- Weighted- average Aggregate average remaining intrinsic Shares exercise price contractual term value Outstanding, September 30, 2015 337,938 $39.19 Exercised (47,834 ) 37.59 Expired or forfeited (98,745 ) 37.33 Outstanding, December 31, 2015 191,359 40.56 0.9 $2,468 Exercisable, December 31, 2015 114,193 40.56 0.9 $1,473 |
Non-vested options activity | The transactions for non-vested options for the quarter ended December 31, 2015 were as follows: Weighted-average grant-date Non-vested shares Shares fair value Non-vested at September 30, 2015 166,406 $12.43 Expired or forfeited (89,240 ) 12.56 Non-vested at December 31, 2015 77,166 12.29 |
Assumptions used in estimating fair value | The following table indicates the assumptions used in estimating fair value of restricted stock granted during the periods ended December 31, 2015 and 2014. Three Months Ended December 31, 2015 2014 Expected volatility 20.7 % 22.2 % Dividend yield 1.0 % 1.0 % Average risk-free interest rate 1.7 % 1.7 % Average expected term (years) 2.1 1.8 |
Earnings Per Share Attributab26
Earnings Per Share Attributable to Matthews Shareholders (Tables) | 3 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share Attributable to Matthews Shareholders [Abstract] | |
Information used to compute earnings per share attributable to Matthews' common shareholders | The information used to compute earnings per share attributable to Matthews' common shareholders was as follows: Three Months Ended December 31, 2015 2014 Net income attributable to Matthews shareholders $ 4,614 $ 14,360 Less: dividends and undistributed earnings allocated to participating securities - 5 Net income available to Matthews shareholders $ 4,614 $ 14,365 Weighted-average shares outstanding (in thousands): Basic shares 32,946 32,919 Effect of dilutive securities 249 174 Diluted shares 33,195 33,093 |
Pension and Other Postretirem27
Pension and Other Postretirement Benefit Plans (Tables) | 3 Months Ended |
Dec. 31, 2015 | |
Pension and Other Postretirement Benefit Plans [Abstract] | |
Net periodic pension and other postretirement benefit cost | The Company provides defined benefit pension and other postretirement plans to certain employees. Net periodic pension and other postretirement benefit cost for the plans included the following: Three Months Ended December 31, Pension Other Postretirement 2015 2014 2015 2014 Service cost $ 1,813 $ 1,655 $ 101 $ 114 Interest cost 2,406 2,145 211 221 Expected return on plan assets (2,407 ) (2,470 ) - - Amortization: Prior service cost (46 ) (45 ) (49 ) (49 ) Net actuarial loss 1,866 1,564 - - Net benefit cost $ 3,632 $ 2,849 $ 263 $ 286 |
Contributions made and anticipated for the current fiscal year | Contributions made and anticipated for fiscal year 2016 are as follows: Contributions Pension Other Postretirement Contributions during the three months ended December 31, 2015: Supplemental retirement plan $ 181 $ - Other postretirement plan - 451 Additional contributions expected in fiscal 2016: Supplemental retirement plan $ 568 $ - Other postretirement plan - 558 |
Accumulated Other Comprehensi28
Accumulated Other Comprehensive Income (Tables) | 3 Months Ended |
Dec. 31, 2015 | |
Accumulated Other Comprehensive Income [Abstract] | |
Change in AOCI by component | The change in AOCI by component, net of tax, for the three month periods ended December 31, 2015 and 2014 were as follows: Post-retirement benefit plans Currency translation adjustment Derivatives Total Attributable to Matthews: Balance, September 30, 2014 $ (39,651 ) $ (27,367 ) $ 201 $ (66,817 ) OCI before reclassification - (26,282 ) (1,468 ) (27,750 ) Amounts reclassified from AOCI (a) 925 (b) 657 1,582 Net current-period OCI 925 (26,282 ) (811 ) (26,168 ) Balance, December 31, 2014 $ (38,726 ) $ (53,649 ) $ (610 ) $ (92,985 ) Attributable to noncontrolling interest: Balance, September 30, 2014 - $ 516 - $ 516 OCI before reclassification - (10 ) - (10 ) Net current-period OCI - (10 ) - (10 ) Balance, December 31, 2014 - $ 506 - $ 506 Post-retirement benefit plans Currency translation adjustment Derivatives Total Attributable to Matthews: Balance, September 30, 2015 $ (43,474 ) $ (104,604 ) $ (2,248 ) $ (150,326 ) OCI before reclassification - (10,069 ) (b) 1,076 (8,993 ) Amounts reclassified from AOCI (a) 1,102 506 1,608 Net current-period OCI 1,102 (10,069 ) 1,582 (7,385 ) Balance, December 31, 2015 $ (42,372 ) $ (114,673 ) $ (666 ) $ (157,711 ) Attributable to noncontrolling interest: Balance, September 30, 2015 - $ 366 - $ 366 OCI before reclassification - (53 ) - (53 ) Net current-period OCI - (53 ) - (53 ) Balance, December 31, 2015 - $ 313 - $ 313 (a) Amounts were included in net periodic benefit cost for pension and other postretirement benefit plans (see note 8). (b) Amounts were included in interest expense in the periods the hedged item affected earnings (see note 5). |
Reclassifications out of AOCI | Reclassifications out of AOCI for the three month periods ended December 31, 2015 and 2014 were as follows: Amount reclassified from AOCI Details about AOCI Components Three months ended December 31, 2015 Three months ended December 31, 2014 Affected line item in the Statement of income Postretirement benefit plans Prior service (cost) credit $ 95 $ 94 (a) Actuarial losses (1,866 ) (1,564 ) (a) (1,771 ) (1,470 ) (b) Total before tax (669 ) (545 ) Tax provision (benefit) $ (1,102 ) $ (925 ) Net of tax Derivatives Interest rate swap contracts $ (830 ) $ (1,077 ) Interest expense (830 ) (1,077 ) (b) Total before tax (324 ) (420 ) Tax provision (benefit) $ (506 ) $ (657 ) Net of tax (a) Amounts are included in the computation of pension and other postretirement benefit expense, which is reported in both cost of goods sold and selling and administrative expenses. For additional information, see Note 8. (b) For pre-tax items, positive amounts represent income and negative amounts represent expense. |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Dec. 31, 2015 | |
Income Taxes [Abstract] | |
Tax years subject to examination | As of December 31, 2015, the tax years that remain subject to examination by major jurisdiction generally are: United States – Federal 2012 and forward United States – State 2011 and forward Canada 2010 and forward Europe 2009 and forward United Kingdom 2013 and forward Australia 2011 and forward Asia 2009 and forward |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Dec. 31, 2015 | |
Segment Information [Abstract] | |
Information about the segments | Information about the Company's segments follows: Three Months Ended December 31, 2015 2014 Sales to external customers: SGK Brand Solutions $ 178,291 $ 200,834 Memorialization 147,611 116,223 Industrial 28,330 26,527 $ 354,232 $ 343,584 Three Months Ended December 31, 2015 2014 Operating profit: SGK Brand Solutions $ 2,755 $ 1,850 Memorialization 7,689 21,486 Industrial 1,594 2,249 $ 12,038 $ 25,585 |
Goodwill and Other Intangible31
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Dec. 31, 2015 | |
Goodwill and Other Intangible Assets [Abstract] | |
Goodwill attributable to each segment | A summary of the carrying amount of goodwill attributable to each segment as well as the changes in such amounts are as follows: SGK Brand Solutions Memorialization Industrial Consolidated Goodwill $ 466,647 $ 346,946 $ 52,887 $ 866,480 Accumulated impairment losses (5,752 ) (5,000 ) - (10,752 ) Balance at September 30, 2015 460,895 341,946 52,887 855,728 Additions during period - - - - Translation and other adjustments (4,995 ) 904 (163 ) (4,254 ) Goodwill 461,652 347,850 52,724 862,226 Accumulated impairment losses (5,752 ) (5,000 ) - (10,752 ) Balance at December 31, 2015 $ 455,900 $ 342,850 $ 52,724 $ 851,474 |
Other intangible assets | The following tables summarize the carrying amounts and related accumulated amortization for intangible assets as of December 31, 2015 and September 30, 2015, respectively. Carrying Accumulated Amount Amortization Net December 31, 2015: Trade names $ 168,467 $ - * $ 168,467 Trade names 1,781 (1,707 ) 74 Customer relationships 285,909 (46,667 ) 239,242 Copyrights/patents/other 11,315 (10,356 ) 959 $ 467,472 $ (58,730 ) $ 408,742 September 30, 2015 Trade names $ 168,467 $ - * $ 168,467 Trade names 1,815 (1,718 ) 97 Customer relationships 296,689 (51,393 ) 245,296 Copyrights/patents/other 11,389 (10,249 ) 1,140 $ 478,360 $ (63,360 ) $ 415,000 * Not subject to amortization |
Basis of Presentation (Details)
Basis of Presentation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2015 | |
Basis of Presentation [Abstract] | |||
Deferred tax assets | $ 19,753 | ||
Deferred tax liabilities | $ 340 | ||
Consolidated Statements of Income [Abstract] | |||
Other deductions, net | $ (874) | $ (1,304) | |
Income before income taxes | 6,025 | 19,219 | |
Income taxes | (1,522) | (4,974) | |
Net income | 4,503 | 14,245 | |
Net income attributable to Matthews shareholders | 4,614 | 14,360 | |
Comprehensive loss | $ (2,935) | $ (11,933) | |
Earnings per share attributable to Matthews shareholders [Abstract] | |||
Basic (in dollars per share) | $ 0.14 | $ 0.44 | |
Diluted (in dollars per share) | $ 0.14 | $ 0.43 | |
Consolidated Statements of Cash Flows [Abstract] | |||
Net income | $ 4,503 | $ 14,245 | |
Changes in working capital items | (12,486) | (12,982) | |
Net cash provided by operating activities | 10,019 | 8,423 | |
Net change in cash and cash equivalents | $ (7,090) | (6,989) | |
Previously Reported [Member] | |||
Consolidated Statements of Income [Abstract] | |||
Other deductions, net | (435) | ||
Income before income taxes | 20,088 | ||
Income taxes | (5,252) | ||
Net income | 14,836 | ||
Net income attributable to Matthews shareholders | 14,951 | ||
Comprehensive loss | $ (11,342) | ||
Earnings per share attributable to Matthews shareholders [Abstract] | |||
Basic (in dollars per share) | $ 0.45 | ||
Diluted (in dollars per share) | $ 0.45 | ||
Consolidated Statements of Cash Flows [Abstract] | |||
Net income | $ 14,836 | ||
Changes in working capital items | (12,704) | ||
Net cash provided by operating activities | 9,292 | ||
Net change in cash and cash equivalents | (6,120) | ||
Adjustment [Member] | |||
Consolidated Statements of Income [Abstract] | |||
Other deductions, net | (869) | ||
Income before income taxes | (869) | ||
Income taxes | 278 | ||
Net income | (591) | ||
Net income attributable to Matthews shareholders | (591) | ||
Comprehensive loss | $ (591) | ||
Earnings per share attributable to Matthews shareholders [Abstract] | |||
Basic (in dollars per share) | $ (0.01) | ||
Diluted (in dollars per share) | $ (0.02) | ||
Consolidated Statements of Cash Flows [Abstract] | |||
Net income | $ (591) | ||
Changes in working capital items | (278) | ||
Net cash provided by operating activities | (869) | ||
Net change in cash and cash equivalents | $ (869) |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Recurring [Member] - USD ($) $ in Thousands | Dec. 31, 2015 | Sep. 30, 2015 | |
Assets [Abstract] | |||
Derivatives | [1] | $ 125 | $ 0 |
Trading securities | 18,868 | 18,444 | |
Total assets at fair value | 18,993 | 18,444 | |
Liabilities [Abstract] | |||
Derivatives | [1] | 1,217 | 3,686 |
Total liabilities at fair value | 1,217 | 3,686 | |
Level 1 [Member] | |||
Assets [Abstract] | |||
Derivatives | [1] | 0 | 0 |
Trading securities | 18,868 | 18,444 | |
Total assets at fair value | 18,868 | 18,444 | |
Liabilities [Abstract] | |||
Derivatives | [1] | 0 | 0 |
Total liabilities at fair value | 0 | 0 | |
Level 2 [Member] | |||
Assets [Abstract] | |||
Derivatives | [1] | 125 | 0 |
Trading securities | 0 | 0 | |
Total assets at fair value | 125 | 0 | |
Liabilities [Abstract] | |||
Derivatives | [1] | 1,217 | 3,686 |
Total liabilities at fair value | 1,217 | 3,686 | |
Level 3 [Member] | |||
Assets [Abstract] | |||
Derivatives | [1] | 0 | 0 |
Trading securities | 0 | 0 | |
Total assets at fair value | 0 | 0 | |
Liabilities [Abstract] | |||
Derivatives | [1] | 0 | 0 |
Total liabilities at fair value | $ 0 | $ 0 | |
[1] | Interest rate swaps are valued based on observable market swap rates and are classified within Level 2 of the fair value hierarchy. |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Sep. 30, 2015 |
Inventory, net [Abstract] | ||
Raw materials | $ 50,624 | $ 48,636 |
Work in process | 34,977 | 32,567 |
Finished goods | 86,032 | 90,220 |
Inventories | $ 171,633 | $ 171,423 |
Debt (Details)
Debt (Details) | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2015USD ($)LinesofCredit | Dec. 31, 2014USD ($) | Sep. 30, 2015USD ($) | Dec. 31, 2015EUR (€)LinesofCredit | Sep. 30, 2015EUR (€) | ||
Line of Credit Facility [Line Items] | ||||||
Other current assets | $ 66,833,000 | $ 64,394,000 | ||||
Interest rate cash flow hedges [Abstract] | ||||||
Unrealized gain (loss) on fair value of interest rate swaps, before tax | (1,092,000) | (3,686,000) | ||||
Unrealized gain (loss) on fair value of interest rate swaps, after tax | (666,000) | (2,248,000) | ||||
Unrealized gain (loss) expected to be recognized over the next 12 months | (240,000) | |||||
Domestic Revolving Credit Facility [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum amount of borrowings available | $ 900,000,000 | |||||
Interest rate on borrowings | 1.75% | 1.75% | ||||
Maximum available for issuance of trade and standby letters of credit | $ 30,000,000 | |||||
Outstanding borrowings | $ 872,425,000 | 857,425,000 | ||||
Weighted-average interest rate on outstanding borrowings | 2.31% | 2.51% | 2.31% | |||
Domestic Revolving Credit Facility [Member] | Minimum [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Annual commitment fee range on unused portion | 0.15% | |||||
Domestic Revolving Credit Facility [Member] | Maximum [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Annual commitment fee range on unused portion | 0.25% | |||||
Domestic Revolving Credit Facility [Member] | LIBOR [Member] | Minimum [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest rate on borrowings, based on leverage ratio | 0.75% | |||||
Domestic Revolving Credit Facility [Member] | LIBOR [Member] | Maximum [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest rate on borrowings, based on leverage ratio | 2.00% | |||||
Credit Facility With European Bank [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum amount of borrowings available | $ 38,171,000 | € 35,000,000 | ||||
Outstanding borrowings | $ 22,810,000 | 26,829,000 | € 20,900,000 | € 23,900,000 | ||
Weighted-average interest rate on outstanding borrowings | 1.50% | 1.27% | 1.50% | |||
Lines of Credit with Italian Banks [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Outstanding borrowings | $ 6,192,000 | 5,166,000 | € 5,700,000 | 4,600,000 | ||
Letter of Credit [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Other current assets | $ 12,925,000 | |||||
Matthews International S.p.A [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Weighted-average interest rate on outstanding borrowings | 3.33% | 3.18% | 3.33% | |||
Matthews International S.p.A [Member] | Lines of Credit with Italian Banks [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum amount of borrowings available | $ 12,356,000 | € 11,300,000 | ||||
Outstanding borrowings | $ 3,780,000 | 4,772,000 | € 3,500,000 | 4,300,000 | ||
Number of lines of credit | LinesofCredit | 3 | 3 | ||||
Saueressig [Member] | Credit Facility With European Bank [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Outstanding borrowings | $ 1,053,000 | 824,000 | € 965,452 | 734,452 | ||
Weighted-average interest rate on outstanding borrowings | 4.00% | 4.24% | 4.00% | |||
Wetzel GmbH [Member] | Credit Facility With European Bank [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Outstanding borrowings | $ 1,597,000 | 2,110,000 | € 1,500,000 | € 1,900,000 | ||
Weighted-average interest rate on outstanding borrowings | 6.12% | 5.74% | 6.12% | |||
Cash Flow Hedging [Member] | Interest Rate Swaps [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of (loss) recognized in AOCI on derivatives | $ 1,076,000 | $ (1,468,000) | ||||
Cash Flow Hedging [Member] | Interest Rate Swaps [Member] | Interest Expense [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of loss recognized in income (loss) on derivatives | (830,000) | (1,077,000) | ||||
Amount of gain or (loss) reclassified from AOCI into income (effective portion) | [1] | (506,000) | $ (657,000) | |||
Designated as Hedging Instrument [Member] | Interest Rate Swaps [Member] | ||||||
Derivatives, Fair Value [Line Items] | ||||||
Total derivatives | (1,092,000) | (3,686,000) | ||||
Designated as Hedging Instrument [Member] | Interest Rate Swaps [Member] | Current assets: Other Current Assets [Member] | ||||||
Derivatives, Fair Value [Line Items] | ||||||
Assets derivatives | 26,000 | 0 | ||||
Designated as Hedging Instrument [Member] | Interest Rate Swaps [Member] | Long-term assets: Other Assets [Member] | ||||||
Derivatives, Fair Value [Line Items] | ||||||
Assets derivatives | 99,000 | 0 | ||||
Designated as Hedging Instrument [Member] | Interest Rate Swaps [Member] | Current Liabilities: Other Current Liabilities [Member] | ||||||
Derivatives, Fair Value [Line Items] | ||||||
Liability derivatives | (420,000) | (1,165,000) | ||||
Designated as Hedging Instrument [Member] | Interest Rate Swaps [Member] | Long-Term Liabilities: Other Liabilities [Member] | ||||||
Derivatives, Fair Value [Line Items] | ||||||
Liability derivatives | $ (797,000) | $ (2,521,000) | ||||
Interest Rate Swap 1 [Member] | ||||||
Derivative [Line Items] | ||||||
Effective Date | June 2,012 | |||||
Amount | $ 40,000,000 | |||||
Fixed Interest Rate | 1.88% | 1.88% | ||||
Interest Rate Spread | 1.75% | 1.75% | ||||
Maturity Date | June 2,022 | |||||
Interest Rate Swap 2 [Member] | ||||||
Derivative [Line Items] | ||||||
Effective Date | August 2,012 | |||||
Amount | $ 35,000,000 | |||||
Fixed Interest Rate | 1.74% | 1.74% | ||||
Interest Rate Spread | 1.75% | 1.75% | ||||
Maturity Date | June 2,022 | |||||
Interest Rate Swap 3 [Member] | ||||||
Derivative [Line Items] | ||||||
Effective Date | September 2,012 | |||||
Amount | $ 25,000,000 | |||||
Fixed Interest Rate | 1.24% | 1.24% | ||||
Interest Rate Spread | 1.75% | 1.75% | ||||
Maturity Date | March 2,017 | |||||
Interest Rate Swap 4 [Member] | ||||||
Derivative [Line Items] | ||||||
Effective Date | May 2,014 | |||||
Amount | $ 25,000,000 | |||||
Fixed Interest Rate | 1.35% | 1.35% | ||||
Interest Rate Spread | 1.75% | 1.75% | ||||
Maturity Date | May 2,018 | |||||
Interest Rate Swap 5 [Member] | ||||||
Derivative [Line Items] | ||||||
Effective Date | November 2,014 | |||||
Amount | $ 25,000,000 | |||||
Fixed Interest Rate | 1.26% | 1.26% | ||||
Interest Rate Spread | 1.75% | 1.75% | ||||
Maturity Date | June 2,018 | |||||
Interest Rate Swap 6 [Member] | ||||||
Derivative [Line Items] | ||||||
Effective Date | March 2,015 | |||||
Amount | $ 25,000,000 | |||||
Fixed Interest Rate | 1.49% | 1.49% | ||||
Interest Rate Spread | 1.75% | 1.75% | ||||
Maturity Date | March 2,019 | |||||
Interest Rate Swap 7 [Member] | ||||||
Derivative [Line Items] | ||||||
Effective Date | September 2,015 | |||||
Amount | $ 25,000,000 | |||||
Fixed Interest Rate | 1.39% | 1.39% | ||||
Interest Rate Spread | 1.75% | 1.75% | ||||
Maturity Date | September 2,020 | |||||
Interest Rate Swap 8 [Member] | ||||||
Derivative [Line Items] | ||||||
Effective Date | November 2,015 | |||||
Amount | $ 25,000,000 | |||||
Fixed Interest Rate | 1.32% | 1.32% | ||||
Interest Rate Spread | 1.75% | 1.75% | ||||
Maturity Date | November 2,020 | |||||
Interest Rate Swap 9 [Member] | ||||||
Derivative [Line Items] | ||||||
Effective Date | December 2,015 | |||||
Amount | $ 25,000,000 | |||||
Fixed Interest Rate | 1.59% | 1.59% | ||||
Interest Rate Spread | 1.75% | 1.75% | ||||
Maturity Date | December 2,020 | |||||
[1] | There is no ineffective portion or amount excluded from effectiveness testing. |
Share-Based Payments (Details)
Share-Based Payments (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2015 | |
Director Fee Plan [Member] | |||
Stock option activity [Roll Forward] | |||
Outstanding, end of period (in shares) | 0 | ||
Director Fee Plan, aggregate disclosures [Abstract] | |||
Shares deferred under the Director Fee Plan (in shares) | 17,005 | ||
Value of annual stock based grant | $ 110 | ||
Total stock options granted to date (in shares) | 22,300 | ||
Option awards outstanding (in shares) | 0 | 0 | |
Total restricted stock awards granted to date (in shares) | 136,568 | ||
Restricted stock awards unvested (in shares) | 33,418 | ||
All Plans [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Total stock-based compensation cost | $ 2,526 | $ 2,525 | |
Future income tax benefit from compensation expense recognized | 985 | 985 | |
Cash received from stock options exercised | 1,718 | 3,727 | |
Tax benefit realized from options exercised | $ 283 | 315 | |
All Plans [Member] | Stock Options [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Vesting percentage | 33.00% | ||
Expiration period | 10 years | ||
Restricted stock activity [Roll Forward] | |||
Expired or forfeited (in shares) | (89,240) | ||
Stock option activity [Roll Forward] | |||
Outstanding, beginning of period (in shares) | 337,938 | ||
Exercised (in shares) | (47,834) | ||
Expired or forfeited (in shares) | (98,745) | ||
Outstanding, end of period (in shares) | 191,359 | ||
Exercisable (in shares) | 114,193 | ||
Outstanding, weighted-average exercise price, beginning of period (in dollars per share) | $ 39.19 | ||
Exercised, weighted-average exercise price (in dollars per share) | 37.59 | ||
Expired or forfeited, weighted-average exercise price (in dollars per share) | 37.33 | ||
Outstanding, weighted-average exercise price, end of period (in dollars per share) | $ 40.56 | ||
Exercisable, weighted-average exercise price (in dollars per share) | $ 40.56 | ||
Outstanding, weighted-average remaining contractual term | 10 months 24 days | ||
Outstanding, aggregate intrinsic value | $ 2,468 | ||
Exercisable, weighted-average remaining contractual term | 10 months 24 days | ||
Exercisable, aggregate intrinsic value | $ 1,473 | ||
Intrinsic value of options exercised | $ 898 | $ 841 | |
Non-vested options activity [Roll Forward] | |||
Non-vested at beginning of period (in shares) | 166,406 | ||
Expired or forfeited (in shares) | (89,240) | ||
Non-vested at end of period (in shares) | 77,166 | ||
Non-vested, weighted-average grant-date fair value, beginning of period (in dollars per share) | $ 12.43 | ||
Expired or forfeited, weighted-average grant-date fair value (in dollars per share) | 12.56 | ||
Non-vested, weighted-average grant-date fair value, end of period (in dollars per share) | $ 12.29 | ||
Director Fee Plan, aggregate disclosures [Abstract] | |||
Option awards outstanding (in shares) | 337,938 | 191,359 | |
All Plans [Member] | Stock Options [Member] | After 3 Years [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Vesting percentage | 33.00% | ||
Vesting period | 3 years | ||
All Plans [Member] | Stock Options [Member] | After 4 Years [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Vesting percentage | 33.00% | ||
Vesting period | 4 years | ||
All Plans [Member] | Stock Options [Member] | After 5 Years [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Vesting percentage | 33.00% | ||
Vesting period | 5 years | ||
All Plans [Member] | Restricted Stock [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Expiration period | 5 years | ||
Restricted stock activity [Roll Forward] | |||
Non-vested at beginning of period (in shares) | 570,567 | ||
Granted (in shares) | 213,370 | ||
Vested (in shares) | (249,340) | ||
Expired or forfeited (in shares) | (2,785) | ||
Non-vested at end of period (in shares) | 531,812 | ||
Non-vested weighted-average grant-date fair value, beginning of period (in dollars per share) | $ 33.66 | ||
Granted, weighted-average grant-date fair value (in dollars per share) | 52.08 | ||
Vested, weighted-average grant-date fair value (in dollars per share) | 29.94 | ||
Expired or forfeited, weighted-average grant-date fair value (in dollars per share) | 36.89 | ||
Non-vested weighted-average grant-date fair value, end of period (in dollars per share) | $ 44.93 | ||
Non-vested options activity [Roll Forward] | |||
Expired or forfeited (in shares) | (2,785) | ||
Unrecognized compensation cost [Abstract] | |||
Unrecognized compensation cost on non-vested awards | $ 15,636 | ||
Weighted average period of recognition of unrecognized compensation cost on non-vested awards | 2 years | ||
Fair value assumptions [Abstract] | |||
Expected volatility | 20.70% | 22.20% | |
Dividend yield | 1.00% | 1.00% | |
Average risk-free interest rate | 1.70% | 1.70% | |
Average expected term | 2 years 1 month 6 days | 1 year 9 months 18 days | |
All Plans [Member] | Restricted Stock [Member] | After 3 Years [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Vesting percentage | 50.00% | ||
Vesting period | 3 years | ||
All Plans [Member] | Restricted Stock [Member] | Attainment of Pre-Defined Levels of Appreciation in Market Value [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Vesting percentage | 16.66% | ||
All Plans [Member] | Restricted Stock [Member] | Fiscal 2013 and Thereafter [Member] | After 3 Years [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Vesting percentage | 50.00% | ||
Vesting period | 3 years | ||
All Plans [Member] | Restricted Stock [Member] | Fiscal 2013 and Thereafter [Member] | Attainment of Pre-Defined Levels of Appreciation in Market Value [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Vesting percentage | 8.33% | ||
All Plans [Member] | Restricted Stock [Member] | Fiscal 2013 and Thereafter [Member] | Attainment of Pre-Defined Levels of Adjusted Earnings Per Share [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Vesting percentage | 8.33% | ||
2012 Equity Incentive Plan [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Term of plan | 10 years | ||
Maximum number of shares available for grants or awards (in shares) | 2,500,000 | ||
Shares reserved for future issuance under award plan (in shares) | 1,050,058 | ||
2014 Director Fee Plan [Member] | |||
Share-based compensation, aggregate disclosures [Abstract] | |||
Shares reserved for future issuance under award plan (in shares) | 150,000 | ||
Director Fee Plan, aggregate disclosures [Abstract] | |||
Annual retainer fee paid to non-employee directors | $ 75 | ||
Annual retainer fee paid to non-employee Chairman of the Board | $ 175 |
Earnings Per Share Attributab37
Earnings Per Share Attributable to Matthews Shareholders (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Earnings Per Share Attributable to Matthews Shareholders [Abstract] | ||
Net income attributable to Matthews shareholders | $ 4,614 | $ 14,360 |
Less: dividends and undistributed earnings allocated to participating securities | 0 | 5 |
Net income available to Matthews shareholders | $ 4,614 | $ 14,365 |
Weighted-average shares outstanding [Abstract] | ||
Basic shares (in shares) | 32,946 | 32,919 |
Effect of dilutive securities (in shares) | 249 | 174 |
Diluted shares (in shares) | 33,195 | 33,093 |
Stock Options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of earnings per share (in shares) | 0 | 0 |
Pension and Other Postretirem38
Pension and Other Postretirement Benefit Plans (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Pension [Member] | ||
Net periodic benefit cost [Abstract] | ||
Service cost | $ 1,813 | $ 1,655 |
Interest cost | 2,406 | 2,145 |
Expected return on plan assets | (2,407) | (2,470) |
Amortization [Abstract] | ||
Prior service cost | (46) | (45) |
Net actuarial loss | 1,866 | 1,564 |
Net benefit cost | 3,632 | 2,849 |
Other Postretirement Plans [Member] | ||
Net periodic benefit cost [Abstract] | ||
Service cost | 101 | 114 |
Interest cost | 211 | 221 |
Expected return on plan assets | 0 | 0 |
Amortization [Abstract] | ||
Prior service cost | (49) | (49) |
Net actuarial loss | 0 | 0 |
Net benefit cost | 263 | $ 286 |
Benefit plan contributions [Abstract] | ||
Other postretirement plan | 451 | |
Additional contributions expected in fiscal 2016 | 558 | |
Supplemental Retirement Plan [Member] | ||
Benefit plan contributions [Abstract] | ||
Supplemental retirement plan | 181 | |
Additional contributions expected in fiscal 2016 | $ 568 |
Accumulated Other Comprehensi39
Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | $ (150,326) | ||
Other comprehensive loss, net of tax | (7,438) | $ (26,178) | |
Balance | (157,711) | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Interest expense | (5,840) | (5,333) | |
Total before tax | 6,025 | 19,219 | |
Tax provision (benefit) | (1,522) | (4,974) | |
Net income | 4,503 | 14,245 | |
Matthews [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | (150,326) | (66,817) | |
OCI before reclassification | (8,993) | (27,750) | |
Amounts reclassified from AOCI | 1,608 | 1,582 | |
Other comprehensive loss, net of tax | (7,385) | (26,168) | |
Balance | (157,711) | (92,985) | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net income | 4,614 | 14,360 | |
Noncontrolling Interest [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | 366 | 516 | |
OCI before reclassification | (53) | (10) | |
Other comprehensive loss, net of tax | (53) | (10) | |
Balance | 313 | 506 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net income | (111) | (115) | |
Post-retirement Benefit Plans [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Prior service (cost) credit | [1] | 95 | 94 |
Actuarial losses | [1] | (1,866) | (1,564) |
Total before tax | [2] | (1,771) | (1,470) |
Tax provision (benefit) | (669) | (545) | |
Net income | (1,102) | (925) | |
Post-retirement Benefit Plans [Member] | Matthews [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | (43,474) | (39,651) | |
OCI before reclassification | 0 | 0 | |
Amounts reclassified from AOCI | [3] | 1,102 | 925 |
Other comprehensive loss, net of tax | 1,102 | 925 | |
Balance | (42,372) | (38,726) | |
Post-retirement Benefit Plans [Member] | Noncontrolling Interest [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | 0 | 0 | |
OCI before reclassification | 0 | 0 | |
Other comprehensive loss, net of tax | 0 | 0 | |
Balance | 0 | 0 | |
Currency Translation Adjustment [Member] | Matthews [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | (104,604) | (27,367) | |
OCI before reclassification | (10,069) | (26,282) | |
Other comprehensive loss, net of tax | (10,069) | (26,282) | |
Balance | (114,673) | (53,649) | |
Currency Translation Adjustment [Member] | Noncontrolling Interest [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | 366 | 516 | |
OCI before reclassification | (53) | (10) | |
Other comprehensive loss, net of tax | (53) | (10) | |
Balance | 313 | 506 | |
Derivatives [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Interest expense | (830) | (1,077) | |
Total before tax | [2] | (830) | (1,077) |
Tax provision (benefit) | (324) | (420) | |
Net income | (506) | (657) | |
Derivatives [Member] | Matthews [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | (2,248) | 201 | |
OCI before reclassification | 1,076 | (1,468) | |
Amounts reclassified from AOCI | [4] | 506 | 657 |
Other comprehensive loss, net of tax | 1,582 | (811) | |
Balance | (666) | (610) | |
Derivatives [Member] | Noncontrolling Interest [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | 0 | 0 | |
OCI before reclassification | 0 | 0 | |
Other comprehensive loss, net of tax | 0 | 0 | |
Balance | $ 0 | $ 0 | |
[1] | Amounts are included in the computation of pension and other postretirement benefit expense, which is reported in both cost of goods sold and selling and administrative expenses. For additional information, see Note 8. | ||
[2] | For pre-tax items, positive amounts represent income and negative amounts represent expense. | ||
[3] | Amounts were included in net periodic benefit cost for pension and other postretirement benefit plans (see note 8). | ||
[4] | Amounts were included in interest expense in the periods the hedged item affected earnings (see note 5). |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2015 | |
Income Taxes [Abstract] | |||
Effective tax rate | 25.30% | 25.90% | |
Federal statutory rate | 35.00% | ||
Unrecognized tax benefits that would impact effective tax rate | $ 4,115 | $ 4,086 | |
Total penalties and interest accrued | $ 2,029 | $ 2,010 | |
United States - Federal [Member] | |||
Open Tax Years By Jurisdiction [Line Items] | |||
Years under examination | 2012 and forward | ||
United States - State [Member] | |||
Open Tax Years By Jurisdiction [Line Items] | |||
Years under examination | 2011 and forward | ||
Canada [Member] | |||
Open Tax Years By Jurisdiction [Line Items] | |||
Years under examination | 2010 and forward | ||
Europe [Member] | |||
Open Tax Years By Jurisdiction [Line Items] | |||
Years under examination | 2009 and forward | ||
United Kingdom [Member] | |||
Open Tax Years By Jurisdiction [Line Items] | |||
Years under examination | 2013 and forward | ||
Australia [Member] | |||
Open Tax Years By Jurisdiction [Line Items] | |||
Years under examination | 2011 and forward | ||
Asia [Member] | |||
Open Tax Years By Jurisdiction [Line Items] | |||
Years under examination | 2009 and forward |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | |
Dec. 31, 2015USD ($)Segment | Dec. 31, 2014USD ($) | |
Segment Information [Abstract] | ||
Number of operating segments | Segment | 3 | |
Segment Reporting Information [Line Items] | ||
Sales to external customers | $ 354,232 | $ 343,584 |
Operating profit | 12,038 | 25,585 |
Reporting Segments [Member] | SGK Brand Solutions [Member] | ||
Segment Reporting Information [Line Items] | ||
Sales to external customers | 178,291 | 200,834 |
Operating profit | 2,755 | 1,850 |
Reporting Segments [Member] | Memorialization [Member] | ||
Segment Reporting Information [Line Items] | ||
Sales to external customers | 147,611 | 116,223 |
Operating profit | 7,689 | 21,486 |
Reporting Segments [Member] | Industrial [Member] | ||
Segment Reporting Information [Line Items] | ||
Sales to external customers | 28,330 | 26,527 |
Operating profit | $ 1,594 | $ 2,249 |
Acquisitions (Details)
Acquisitions (Details) $ in Thousands | Aug. 19, 2015USD ($) |
Aurora [Member] | |
Business Acquisition [Line Items] | |
Purchase price of acquisition | $ 211,604 |
Goodwill and Other Intangible43
Goodwill and Other Intangible Assets, Goodwill (Details) $ in Thousands | 3 Months Ended |
Dec. 31, 2015USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, gross | $ 866,480 |
Accumulated impairment losses | (10,752) |
Goodwill | 855,728 |
Additions during period | 0 |
Translation and other adjustments | (4,254) |
Goodwill, gross | 862,226 |
Accumulated impairment losses | (10,752) |
Goodwill | 851,474 |
SGK Brand Solutions [Member] | |
Goodwill [Roll Forward] | |
Goodwill, gross | 466,647 |
Accumulated impairment losses | (5,752) |
Goodwill | 460,895 |
Additions during period | 0 |
Translation and other adjustments | (4,995) |
Goodwill, gross | 461,652 |
Accumulated impairment losses | (5,752) |
Goodwill | 455,900 |
Memorialization [Member] | |
Goodwill [Roll Forward] | |
Goodwill, gross | 346,946 |
Accumulated impairment losses | (5,000) |
Goodwill | 341,946 |
Additions during period | 0 |
Translation and other adjustments | 904 |
Goodwill, gross | 347,850 |
Accumulated impairment losses | (5,000) |
Goodwill | 342,850 |
Industrial [Member] | |
Goodwill [Roll Forward] | |
Goodwill, gross | 52,887 |
Accumulated impairment losses | 0 |
Goodwill | 52,887 |
Additions during period | 0 |
Translation and other adjustments | (163) |
Goodwill, gross | 52,724 |
Accumulated impairment losses | 0 |
Goodwill | $ 52,724 |
Goodwill and Other Intangible44
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2015 | ||
Other Intangible Assets [Abstract] | ||||
Carrying Amount | $ 467,472 | $ 478,360 | ||
Accumulated Amortization | (58,730) | (63,360) | ||
Net | 408,742 | 415,000 | ||
Amortization expense on intangible assets | 5,216 | $ 4,650 | ||
Future amortization expense [Abstract] | ||||
Future amortization expense for the remainder 2016 | 16,081 | |||
Future amortization expense 2017 | 20,315 | |||
Future amortization expense 2018 | 19,020 | |||
Future amortization expense 2019 | 17,985 | |||
Future amortization expense 2020 | 16,866 | |||
Trade Names Not Subject to Amortization [Member] | ||||
Other Intangible Assets [Abstract] | ||||
Carrying Amount | 168,467 | 168,467 | ||
Accumulated Amortization | [1] | 0 | 0 | |
Net | 168,467 | 168,467 | ||
Trade Names [Member] | ||||
Other Intangible Assets [Abstract] | ||||
Carrying Amount | 1,781 | 1,815 | ||
Accumulated Amortization | (1,707) | (1,718) | ||
Net | 74 | 97 | ||
Customer Relationships [Member] | ||||
Other Intangible Assets [Abstract] | ||||
Carrying Amount | 285,909 | 296,689 | ||
Accumulated Amortization | (46,667) | (51,393) | ||
Net | 239,242 | 245,296 | ||
Copyrights/Patents/Other [Member] | ||||
Other Intangible Assets [Abstract] | ||||
Carrying Amount | 11,315 | 11,389 | ||
Accumulated Amortization | (10,356) | (10,249) | ||
Net | $ 959 | $ 1,140 | ||
[1] | Not subject to amortization |