Cover Page
Cover Page - shares | 6 Months Ended | |
Oct. 28, 2023 | Dec. 04, 2023 | |
Cover [Abstract] | ||
Entity Registrant Name | METHODE ELECTRONICS, INC. | |
Entity Central Index Key | 0000065270 | |
Document Type | 10-Q | |
Document Period End Date | Oct. 28, 2023 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --04-27 | |
Entity Current Reporting Status | Yes | |
Trading Symbol | MEI | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 35,599,426 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q2 | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity File Number | 001-33731 | |
Entity Tax Identification Number | 36-2090085 | |
Entity Address, Address Line One | 8750 West Bryn Mawr Avenue | |
Entity Address, Address Line Two | Suite 1000 | |
Entity Address, City or Town | Chicago | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60631-3518 | |
City Area Code | 708 | |
Local Phone Number | 867-6777 | |
Entity Incorporation, State or Country Code | DE | |
Entity Interactive Data Current | Yes | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Title of 12(b) Security | Common Stock, $0.50 Par Value | |
Security Exchange Name | NYSE |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Income Statement [Abstract] | ||||
Net sales | $ 288 | $ 315.9 | $ 577.7 | $ 598.3 |
Cost of products sold | 235.7 | 241.8 | 471.4 | 462.4 |
Gross profit | 52.3 | 74.1 | 106.3 | 135.9 |
Selling and administrative expenses | 40.9 | 36.6 | 85.4 | 71.9 |
Goodwill impairment | 56.5 | 56.5 | ||
Amortization of intangibles | 6.2 | 4.7 | 11.9 | 9.4 |
(Loss) income from operations | (51.3) | 32.8 | (47.5) | 54.6 |
Interest expense, net | 4.4 | 0.5 | 7.2 | 0.5 |
Other income, net | (0.2) | (1.1) | (0.2) | (5.2) |
Pre-tax (loss) income | (55.5) | 33.4 | (54.5) | 59.3 |
Income tax (benefit) expense | (0.2) | 5.8 | (0.1) | 10.2 |
Net (loss) income | (55.3) | 27.6 | (54.4) | 49.1 |
Net (loss) income attributable to Methode | $ (55.3) | $ 27.6 | $ (54.4) | $ 49.1 |
(Loss) income per share attributable to Methode: | ||||
Basic | $ (1.55) | $ 0.76 | $ (1.52) | $ 1.35 |
Diluted | (1.55) | 0.75 | (1.52) | 1.33 |
Cash dividends per share | $ 0.14 | $ 0.14 | $ 0.28 | $ 0.28 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net (loss) income | $ (55.3) | $ 27.6 | $ (54.4) | $ 49.1 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustments | (20.2) | (19.7) | (22.7) | (30.6) |
Derivative financial instruments | 0.4 | 1.6 | (1.2) | 3.1 |
Net other comprehensive income (loss) | (19.8) | (18.1) | (23.9) | (27.5) |
Comprehensive (loss) income | (75.1) | 9.5 | (78.3) | 21.6 |
Comprehensive income attributable to redeemable noncontrolling interest | 0 | 0 | 0 | 0 |
Comprehensive (loss) income attributable to Methode | $ (75.1) | $ 9.5 | $ (78.3) | $ 21.6 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Oct. 28, 2023 | Apr. 29, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 122.5 | $ 157 |
Accounts receivable, net | 292.3 | 314.3 |
Inventories | 183.9 | 159.7 |
Income tax receivable | 16.7 | 12.9 |
Prepaid expenses and other current assets | 21.1 | 20.5 |
Total current assets | 636.5 | 664.4 |
Long-term assets: | ||
Property, plant and equipment, net | 224.6 | 220.3 |
Goodwill | 220.7 | 301.9 |
Other intangible assets, net | 264.7 | 256.7 |
Operating lease right-of-use assets, net | 26.9 | 28.4 |
Deferred tax assets | 33 | 33.6 |
Pre-production costs | 44.5 | 36.1 |
Other long-term assets | 34 | 37.7 |
Total long-term assets | 848.4 | 914.7 |
Total assets | 1,484.9 | 1,579.1 |
Current liabilities: | ||
Accounts payable | 133.5 | 138.7 |
Accrued employee liabilities | 29 | 36.7 |
Other accrued liabilities | 38.7 | 34.5 |
Short-term operating lease liabilities | 6.6 | 6.8 |
Short-term debt | 3 | 3.2 |
Income tax payable | 7.5 | 8.1 |
Total current liabilities | 218.3 | 228 |
Long-term liabilities: | ||
Long-term debt | 329 | 303.6 |
Long-term operating lease liabilities | 20.9 | 21.8 |
Long-term income tax payable | 9.3 | 16.7 |
Other long-term liabilities | 16.5 | 14.3 |
Deferred tax liabilities | 46 | 41.8 |
Total long-term liabilities | 421.7 | 398.2 |
Total liabilities | 640 | 626.2 |
Redeemable noncontrolling interest | 11.1 | |
Shareholders' equity: | ||
Common stock, $0.50 par value, 100,000,000 shares authorized, 37,034,050 shares and 37,167,375 shares issued as of October 28, 2023 and April 29, 2023, respectively | 18.5 | 18.6 |
Additional paid-in capital | 183.8 | 181 |
Accumulated other comprehensive loss | (42.9) | (19) |
Treasury stock, 1,346,624 shares as of October 28, 2023 and April 29, 2023 | (11.5) | (11.5) |
Retained earnings | 697 | 772.7 |
Total shareholders' equity | 844.9 | 941.8 |
Total liabilities and shareholders' equity | $ 1,484.9 | $ 1,579.1 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Oct. 28, 2023 | Apr. 29, 2023 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.50 | $ 0.50 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 37,034,050 | 37,167,375 |
Treasury stock, shares | 1,346,624 | 1,346,624 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Millions | Total | Redeemable Noncontrolling Interest | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Treasury stock | Retained Earnings |
Beginning balance at Apr. 30, 2022 | $ 913.8 | $ 19.2 | $ 169 | $ (26.8) | $ (11.5) | $ 763.9 | |
Beginning balance (in shares) at Apr. 30, 2022 | 38,276,968 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of restricted stock, net of tax withholding | (0.4) | (0.4) | |||||
Issuance of restricted stock, net of tax withholding (in shares) | 54,479 | ||||||
Purchases of common stock | $ (31.6) | $ (0.5) | (31.1) | ||||
Purchases of common stock (in shares) | (825,814) | (825,814) | |||||
Stock-based compensation expense | $ 5.7 | 5.7 | |||||
Other comprehensive loss | (27.5) | (27.5) | |||||
Net Income (Loss) | 49.1 | 49.1 | |||||
Dividends on common stock | (10.3) | (10.3) | |||||
Ending balance at Oct. 29, 2022 | 898.8 | $ 18.7 | 174.7 | (54.3) | (11.5) | 771.2 | |
Ending balance (in shares) at Oct. 29, 2022 | 37,505,633 | ||||||
Beginning balance at Jul. 30, 2022 | 911.4 | $ 19 | 172 | (36.2) | (11.5) | 768.1 | |
Beginning balance (in shares) at Jul. 30, 2022 | 38,001,714 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of restricted stock, net of tax withholding (in shares) | 12,098 | ||||||
Purchases of common stock | $ (19.7) | $ (0.3) | (19.4) | ||||
Purchases of common stock (in shares) | (508,179) | (508,179) | |||||
Stock-based compensation expense | $ 2.7 | 2.7 | |||||
Other comprehensive loss | (18.1) | (18.1) | |||||
Net Income (Loss) | 27.6 | 27.6 | |||||
Dividends on common stock | (5.1) | (5.1) | |||||
Ending balance at Oct. 29, 2022 | 898.8 | $ 18.7 | 174.7 | (54.3) | (11.5) | 771.2 | |
Ending balance (in shares) at Oct. 29, 2022 | 37,505,633 | ||||||
Beginning balance at Apr. 29, 2023 | 941.8 | $ 18.6 | 181 | (19) | (11.5) | 772.7 | |
Beginning Balance at Apr. 29, 2023 | $ 11.1 | ||||||
Beginning balance (in shares) at Apr. 29, 2023 | 37,167,375 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of restricted stock, net of tax withholding | (3.8) | $ 0.1 | (0.1) | (3.8) | |||
Issuance of restricted stock, net of tax withholding (in shares) | 189,454 | ||||||
Purchase of redeemable noncontrolling interest | (11.1) | ||||||
Purchases of common stock | $ (7.8) | $ (0.2) | (7.6) | ||||
Purchases of common stock (in shares) | (322,779) | (322,779) | |||||
Stock-based compensation expense | $ 2.9 | 2.9 | |||||
Other comprehensive loss | (23.9) | (23.9) | |||||
Net Income (Loss) | (54.4) | (54.4) | |||||
Dividends on common stock | (9.9) | (9.9) | |||||
Ending balance at Oct. 28, 2023 | 844.9 | $ 18.5 | 183.8 | (42.9) | (11.5) | 697 | |
Ending balance (in shares) at Oct. 28, 2023 | 37,034,050 | ||||||
Beginning balance at Jul. 29, 2023 | 931.4 | $ 18.7 | 182.5 | (23.1) | (11.5) | 764.8 | |
Beginning Balance at Jul. 29, 2023 | 0.9 | ||||||
Beginning balance (in shares) at Jul. 29, 2023 | 37,356,156 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of restricted stock, net of tax withholding (in shares) | 673 | ||||||
Purchase of redeemable noncontrolling interest | $ (0.9) | ||||||
Purchases of common stock | $ (7.8) | $ (0.2) | (7.6) | ||||
Purchases of common stock (in shares) | (322,779) | (322,779) | |||||
Stock-based compensation expense | $ 1.3 | 1.3 | |||||
Other comprehensive loss | (19.8) | (19.8) | |||||
Net Income (Loss) | (55.3) | (55.3) | |||||
Dividends on common stock | (4.9) | (4.9) | |||||
Ending balance at Oct. 28, 2023 | $ 844.9 | $ 18.5 | $ 183.8 | $ (42.9) | $ (11.5) | $ 697 | |
Ending balance (in shares) at Oct. 28, 2023 | 37,034,050 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 6 Months Ended | |
Oct. 28, 2023 | Oct. 29, 2022 | |
Operating activities: | ||
Net (loss) income | $ (54.4) | $ 49.1 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 28.4 | 24.5 |
Stock-based compensation expense | 3.9 | 6.7 |
Change in cash surrender value of life insurance | 0.2 | (0.2) |
Amortization of debt issuance costs | 0.4 | 0.3 |
Loss on sale of property, plant and equipment | 0.5 | 0.1 |
Impairment of long-lived assets | 0.6 | 0.4 |
Goodwill impairment | 56.5 | |
Change in deferred income taxes | (1) | 1 |
Other | 0.8 | 0.2 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 12.5 | (50.6) |
Inventories | (29.1) | (19.5) |
Prepaid expenses and other assets | (10.8) | (15.7) |
Accounts payable | (1.8) | 21.5 |
Other liabilities | (12.5) | 10.3 |
Net cash (used in) provided by operating activities | (6.2) | 28.1 |
Investing activities: | ||
Purchases of property, plant and equipment | (24.5) | (18) |
Proceeds from settlement of net investment hedge | 0.6 | |
Proceeds from disposition of assets | 1.6 | 3.5 |
Net cash used in investing activities | (22.3) | (14.5) |
Financing activities: | ||
Taxes paid related to net share settlement of equity awards | (3.8) | (0.5) |
Repayments of finance leases | (0.1) | (0.2) |
Purchases of common stock | (7.8) | (31.6) |
Cash dividends | (10.1) | (9.9) |
Purchase of redeemable noncontrolling interest | (10.9) | |
Proceeds from borrowings | 213.9 | |
Repayments of borrowings | (179.3) | (6.5) |
Net cash provided by (used in) financing activities | 1.9 | (48.7) |
Effect of foreign currency exchange rate changes on cash and cash equivalents | (7.9) | (7.3) |
Decrease in cash and cash equivalents | (34.5) | (42.4) |
Cash and cash equivalents at beginning of the period | 157 | 172 |
Cash and cash equivalents at end of the period | 122.5 | 129.6 |
Cash paid during the period for: | ||
Interest | 6.7 | 1.4 |
Income taxes, net of refunds | 14.5 | 12.5 |
Operating lease obligations | $ 4.5 | $ 4 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) | $ (55.3) | $ 27.6 | $ (54.4) | $ 49.1 |
Insider Trading Arrangements
Insider Trading Arrangements | 6 Months Ended |
Oct. 28, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Description of Business and Sum
Description of Business and Summary of Significant Accounting Policies | 6 Months Ended |
Oct. 28, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Summary of Significant Accounting Policies | Note 1. Description of Business and Summary of Significant Accounting Policies Description of business Methode Electronics, Inc. (the “Company” or “Methode”) is a leading global supplier of custom engineered solutions with sales, engineering and manufacturing locations in North America, Europe, Middle East and Asia. The Company designs, engineers and produces mechatronic products for Original Equipment Manufacturers (“OEMs”) utilizing its broad range of technologies for user interface, light-emitting diode (“LED”) lighting system, power distribution and sensor applications. The Company’s solutions are found in the end markets of transportation (including automotive, commercial vehicle, e-bike, aerospace, bus and rail), cloud computing infrastructure, construction equipment and consumer appliance. Basis of presentation The unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). All intercompany balances and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. These interim condensed consolidated financial statements include all adjustments (consisting of normal recurring adjustments, except as otherwise disclosed) that management believes are necessary for a fair presentation of the results of operations, financial position and cash flows of the Company for the interim periods presented. These financial statements should be read in conjunction with the consolidated financial statements included in the Company’s Form 10-K for the year ended April 29, 2023, filed with the SEC on June 27, 2023. Results may vary from quarter to quarter for reasons other than seasonality. Financial reporting periods The Company maintains its financial records on the basis of a 52- or 53-week fiscal year ending on the Saturday closest to April 30. The three months ended October 28, 2023 and October 29, 2022 were both 13 -week periods and the six months ended October 28, 2023 and October 29, 2022 were both 26 -week periods. Use of estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes. These estimates and assumptions are subject to an inherent degree of uncertainty and may change, as new events occur, and additional information is obtained. As a result, actual results may differ from previously estimated amounts, and such differences may be material to the condensed consolidated financial statements. Recently adopted accounting pronouncements In October 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2021-08, “Business Combinations (Topic 805) – Accounting for Contract Assets and Contract Liabilities from Contracts with Customers,” which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured at the acquisition date in accordance with Accounting Standards Codification ("ASC") 606, as if the acquirer had originated the contracts. Prior to the issuance of this ASU, contract assets and liabilities were recognized at fair value on the acquisition date. The Company adopted this ASU in the first quarter of fiscal 2024 on a prospective basis. The adoption of this ASU did not have a material impact on its condensed consolidated financial statements or related disclosures and is only applicable to future business acquisitions. New accounting pronouncements not yet adopted In November 2023, the FASB issued ASU No. 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," which requires public entities to disclose information about their reportable segments’ significant expenses on an interim and annual basis. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Entities must adopt the changes to the segment reporting guidance on a retrospective basis. Early adoption is permitted. The adoption of this ASU will result in increased disclosures for the Company's segments. There have been no other newly issued or newly applicable accounting pronouncements that have had, or are expected to have, a material impact on the Company’s condensed consolidated financial statements. Further, at October 28, 2023, there are no other pronouncements pending adoption that are expected to have a material impact on the Company’s condensed consolidated financial statements. Summary of significant accounting policies The Company’s significant accounting policies are described in Note 1, “Description of Business and Summary of Significant Accounting Policies,” to the consolidated financial statements included in the Company’s Form 10-K for the year ended April 29, 2023. There have been no material changes to the significant accounting policies in the six months ended October 28, 2023 . |
Revenue
Revenue | 6 Months Ended |
Oct. 28, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Note 2. Revenue The Company generates revenue from manufacturing products for customers in diversified global markets. The substantial majority of the Company’s revenue is recognized at a point in time. The Company has determined that the most definitive demonstration that control has transferred to a customer is physical shipment or delivery, depending on the contractual shipping terms, except for consignment transactions. Consignment transactions are arrangements where the Company transfers product to a customer location but retains ownership and control of such product until it is used by the customer. Revenue for consignment arrangements is recognized upon the customer’s usage. Revenue associated with products which the Company believes have no alternative use (such as highly customized parts), and where the Company has an enforceable right to payment, are recognized on an over time basis. Revenue is recognized based on progress to date, which is typically even over the production process through transfer of control to the customer. From time to time, customers may negotiate annual price downs. Management has evaluated these price downs and determined that in some instances, these price downs give rise to a material right. In instances that a material right exists, a portion of the transaction price is allocated to the material right and recognized over the life of the contract. Across all products, the amount of revenue recognized corresponds to the related purchase order and is adjusted for variable consideration (such as discounts) and ongoing price adjustments. Sales and other taxes collected concurrent with revenue-producing activities are excluded from revenue. The Company’s performance obligations are typically short-term in nature. As a result, the Company has elected the practical expedient that provides an exemption from the disclosure requirements regarding information about remaining performance obligations on contracts that have original expected durations of one year or less. Contract balances A contract asset is an entity’s right to consideration in exchange for goods or services that the entity has transferred to a customer. A contract liability exists when an entity has received consideration, or the amount is due from the customer in advance of revenue recognition. The net changes in the contract asset and contract liability balances for the six months ended October 28, 2023 and October 29, 2022 were not material. Disaggregated revenue information The following table represents a disaggregation of revenue from contracts with customers by segment and geographical location. Net sales are attributed to regions based on the location of production. Though revenue recognition patterns and contracts are generally consistent, the amount, timing and uncertainty of revenue and cash flows may vary in each reportable segment due to geographic and economic factors. Three Months Ended October 28, 2023 (in millions) Automotive Industrial Interface Medical Total Geographic net sales: North America $ 70.9 $ 52.0 $ 11.7 $ 1.5 $ 136.1 Europe, the Middle East & Africa ("EMEA") 49.7 42.8 — — 92.5 Asia 33.7 25.6 — 0.1 59.4 Total net sales $ 154.3 $ 120.4 $ 11.7 $ 1.6 $ 288.0 Timing of revenue recognition: Goods transferred at a point in time $ 149.9 $ 120.4 $ 11.7 $ 1.6 $ 283.6 Goods transferred over time 4.4 — — — 4.4 Total net sales $ 154.3 $ 120.4 $ 11.7 $ 1.6 $ 288.0 Three Months Ended October 29, 2022 (in millions) Automotive Industrial Interface Medical Total Geographic net sales: North America $ 97.8 $ 40.1 $ 14.0 $ 1.1 $ 153.0 EMEA 53.9 37.9 — — 91.8 Asia 45.2 25.8 0.1 — 71.1 Total net sales $ 196.9 $ 103.8 $ 14.1 $ 1.1 $ 315.9 Timing of revenue recognition: Goods transferred at a point in time $ 192.3 $ 103.8 $ 14.1 $ 1.1 $ 311.3 Goods transferred over time 4.6 — — — 4.6 Total net sales $ 196.9 $ 103.8 $ 14.1 $ 1.1 $ 315.9 Six Months Ended October 28, 2023 (in millions) Automotive Industrial Interface Medical Total Geographic net sales: North America $ 137.7 $ 92.0 $ 26.9 $ 2.3 $ 258.9 EMEA 101.9 93.9 — — 195.8 Asia 73.0 49.9 — 0.1 123.0 Total net sales $ 312.6 $ 235.8 $ 26.9 $ 2.4 $ 577.7 Timing of revenue recognition: Goods transferred at a point in time $ 304.1 $ 235.8 $ 26.9 $ 2.4 $ 569.2 Goods transferred over time 8.5 — — — 8.5 Total net sales $ 312.6 $ 235.8 $ 26.9 $ 2.4 $ 577.7 Six Months Ended October 29, 2022 (in millions) Automotive Industrial Interface Medical Total Geographic net sales: North America $ 192.5 $ 80.8 $ 27.0 $ 1.8 $ 302.1 EMEA 106.0 66.4 — — 172.4 Asia 75.0 48.7 0.1 — 123.8 Total net sales $ 373.5 $ 195.9 $ 27.1 $ 1.8 $ 598.3 Timing of revenue recognition: Goods transferred at a point in time $ 364.4 $ 195.9 $ 27.1 $ 1.8 $ 589.2 Goods transferred over time 9.1 — — — 9.1 Total net sales $ 373.5 $ 195.9 $ 27.1 $ 1.8 $ 598.3 |
Acquisition and Disposition
Acquisition and Disposition | 6 Months Ended |
Oct. 28, 2023 | |
Acquisitions and Dispositions Disclosure [Abstract] | |
Acquisition and Disposition | Note 3. Acquisition and Disposition Acquisition On April 20, 2023, the Company acquired 92.2 % of the outstanding shares in Nordic Lights Group Corporation (“Nordic Lights”), a premium provider of high-quality lighting solutions for heavy duty equipment headquartered in Finland, for € 121.8 million ($ 134.2 million) in cash. Between May 2023 and July 2023, the Company acquired an additional 7.2 % of the outstanding shares of Nordic Lights for € 9.2 million ($ 10.2 million), increasing the Company’s ownership to 99.4 %. On October 10, 2023, the Company acquired the remaining 0.6 % of the outstanding shares in Nordic Lights for € 0.8 million ($ 0.9 million), as determined by the Finnish arbitral tribunal administering the redemption proceedings for the shares not tendered to the Company. Accordingly, the Company owned 100 % of the outstanding shares in Nordic Lights as of October 10, 2023. The acquisition of Nordic Lights complements the Company’s existing LED lighting solution offerings. The acquisition was funded through a combination of borrowings under the Company's revolving credit facility and cash on hand. The results of the operations of Nordic Lights are reported within the Industrial segment from the date of acquisition. The acquisition was accounted for as a business combination. The Company has estimated the preliminary fair value of net assets acquired based on information currently available and will continue to adjust those estimates as additional information becomes available, including the refinement of valuation assumptions. As the Company finalizes the fair value of assets acquired and liabilities assumed, additional purchase price allocation adjustments will be recorded during the measurement period, but no later than one year from the date of the acquisition. The Company will reflect measurement period adjustments in the period in which the adjustments are determined. Measurement period adjustments recognized in the three months ended October 28, 2023, resulted from the receipt of incremental data utilized in the determination of fair value, including valuation assumptions. The preliminary fair value and subsequent measurement period adjustments of the assets acquired and liabilities assumed, including a reconciliation to the total purchase price, were as follows: As reported as of July 29, 2023 Measurement period adjustments As of October 28, 2023 (in millions) Cash and cash equivalents $ 19.6 $ — $ 19.6 Accounts receivable 17.1 — 17.1 Inventories 9.6 ( 0.2 ) 9.4 Property, plant and equipment 12.9 3.4 16.3 Identifiable intangible assets 68.1 24.5 92.6 Accounts payable ( 10.8 ) — ( 10.8 ) Long-term debt ( 24.4 ) — ( 24.4 ) Other assets and liabilities, net ( 2.8 ) ( 0.5 ) ( 3.3 ) Deferred tax liabilities ( 13.4 ) ( 5.4 ) ( 18.8 ) Total identifiable net assets acquired 75.9 21.8 97.7 Goodwill 69.6 ( 21.8 ) 47.8 Total fair value of net assets acquired 145.5 — 145.5 Less: redeemable noncontrolling interest ( 11.3 ) — ( 11.3 ) Total purchase price $ 134.2 $ — $ 134.2 The noncontrolling interest was recognized at fair value, which was determined to be the noncontrolling interest’s proportionate share of the fair value of net assets acquired, as of the acquisition date. The noncontrolling interest is classified as a redeemable noncontrolling interest on the condensed consolidated balance sheets as minority shareholders owning less than 10 % of the outstanding shares in a company in Finland have the right to require the company to redeem their shares. As noted above, in the six months ended October 28, 2023, the Company acquired the entire redeemable noncontrolling interest. Goodwill arising from the acquisition was included in the Industrial segment as of October 28, 2023 and was attributable to potential synergies and an assembled workforce. The Company does no t expect any recognized goodwill from this acquisition to be deductible for income tax purposes. Intangible assets primarily include customer relationships, technology licenses and trademarks. The weighted average amortization period for the acquired intangible assets is approximately 18.2 years. The pro-forma effects of this acquisition would not materially impact the Company’s operating results for the six months ended October 29, 2022, and as a result no pro-forma financial statements are presented. In the six months ended October 28, 2023, additional acquisition costs of $ 0.5 million were incurred and reported in selling and administrative expenses. Disposition In the first quarter of fiscal 2024, the Company made the decision to initiate the discontinuation of the Dabir business in the Medical segment. On October 13, 2023, the Company sold certain assets and contracts of its Dabir business to a third party for consideration of $ 1.5 million. In the three and six months ended October 28, 2023, the Company recorded a loss on the sale, including transaction costs, of $ 0.6 million, which was included in other income, net on the Company's condensed consolidated statement of operations. The discontinuation of the Dabir business does not qualify as a discontinued operation as it does not represent a strategic shift that would have a major effect on the Company's operations or financial results. |
Income Taxes
Income Taxes | 6 Months Ended |
Oct. 28, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 4. Income Taxes The provision for income taxes for an interim period is based on an estimated annual effective income tax rate applied to ordinary year-to-date earnings or losses. The estimated annual effective income tax rate is determined excluding the effects of unusual or significant one-time items that are reported net of the related tax effects in the period in which they occur. In addition, any material effects of enacted tax law or rate changes as well as the Company’s ability to utilize various tax assets is recognized in the period in which the change occurs. The computation of the estimated annual effective income tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected pre-tax income (or loss) for the year by jurisdiction, certain book to tax adjustments, and the likelihood of the realizability of deferred tax assets generated in the current year. The estimates used to compute the provision or benefit for income taxes may change as new events occur, additional information is obtained or as the Company’s tax environment changes. The Company’s income tax (benefit) expense and effective tax rate for the three and six months ended October 28, 2023 and October 29, 2022 were as follows: Three Months Ended Six Months Ended ($ in millions) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 Pre-tax (loss) income $ ( 55.5 ) $ 33.4 $ ( 54.5 ) $ 59.3 Income tax (benefit) expense $ ( 0.2 ) 5.8 $ ( 0.1 ) 10.2 Effective tax rate 0.4 % 17.4 % 0.2 % 17.2 % The effective tax rate for the three and six months ended October 28, 2023 was lower than the U.S. federal statutory tax rate of 21 % primarily due to the impact of an impairment of goodwill which is non-deductible for tax purposes, income derived from foreign operations with lower statutory tax rates and research deductions claimed in foreign jurisdictions, offset by global intangible low-tax income. The effective tax rate for the three and six months ended October 29, 2022 was lower than the U.S. federal statutory tax rate of 21 % primarily due to income derived from foreign operations with lower statutory tax rates and research deductions claimed in foreign jurisdictions, partially offset by non-deductible expenses. The Company’s gross unrecognized income tax benefits were $ 4.6 million and $ 4.5 million as of October 28, 2023 and April 29, 2023 , respectively. If any portion of the Company’s unrecognized tax benefits is recognized, it would impact the Company’s effective tax rate. The unrecognized tax benefits are reviewed periodically and adjusted for changing facts and circumstances, such as tax audits, the lapsing of applicable statutes of limitations and changes in tax law. The Company recognizes interest and penalties related to income tax uncertainties in income tax expense. Accrued interest and penalties were $ 0.3 million and $ 0.2 million as of October 28, 2023 and April 29, 2023 , respectively. |
Balance Sheet Components
Balance Sheet Components | 6 Months Ended |
Oct. 28, 2023 | |
Balance Sheet Components [Abstract] | |
Balance Sheet Components | Note 5. Balance Sheet Components Cash and cash equivalents Cash and cash equivalents consist of cash and highly liquid investments with maturities of three months or less. Highly liquid investments include money market funds which are classified within Level 1 of the fair value hierarchy. As of October 28, 2023 and April 29, 2023 , the Company had a balance of $ 0.2 million and $ 1.3 million, respectively, in money market accounts. Accounts receivable and allowance for doubtful accounts Accounts receivable are customer obligations due under normal trade terms and are presented net of an allowance for doubtful accounts. The Company establishes an allowance for doubtful accounts based on the current expected credit loss impairment model. The Company applies a historical loss rate based on historic write-offs to aging categories. The historical loss rate is adjusted for current conditions and reasonable and supportable forecasts of future losses as necessary. The Company may also record a specific reserve for individual accounts when it becomes aware of specific customer circumstances, such as in the case of a bankruptcy filing or deterioration in the customer’s operating results or financial position. The allowance for doubtful accounts balance was $ 1.5 million and $ 1.3 million at October 28, 2023 and April 29, 2023, respectively. Inventories Inventories are stated at the lower-of-cost or net realizable value. Cost is determined using the first-in, first-out method. Finished products and work-in-process inventories include direct material costs and direct and indirect manufacturing costs. The Company records reserves for inventory that may be obsolete or in excess of current and future market demand. A summary of inventories is shown below: (in millions) October 28, 2023 April 29, 2023 Finished products $ 47.3 $ 36.6 Work in process 17.7 14.4 Raw materials 118.9 108.7 Total inventories $ 183.9 $ 159.7 Property, plant and equipment Property, plant and equipment is stated at cost. Maintenance and repair costs are expensed as incurred. Depreciation is calculated using the straight-line method using estimated useful lives of 5 to 40 years for buildings and building improvements and 3 to 15 years for machinery and equipment. A summary of property, plant and equipment is shown below: (in millions) October 28, 2023 April 29, 2023 Land $ 3.0 $ 3.0 Buildings and building improvements 99.5 98.8 Machinery and equipment 411.4 414.3 Construction in progress 48.0 40.6 Total property, plant and equipment, gross 561.9 556.7 Less: accumulated depreciation ( 337.3 ) ( 336.4 ) Property, plant and equipment, net $ 224.6 $ 220.3 Depreciation expense was $ 8.2 million and $ 7.5 million in the three months ended October 28, 2023 and October 29, 2022 , respectively. Depreciation expense was $ 16.5 million and $ 15.1 million in the six months ended October 28, 2023 and October 29, 2022, respectively. As of October 28, 2023 and April 29, 2023 , capital expenditures recorded in accounts payable totaled $ 5.6 million and $ 4.5 million, respectively. Pre-production tooling costs related to long-term supply arrangements The Company incurs pre-production tooling costs related to products produced for its customers under long-term supply arrangements. Engineering, testing and other costs incurred in the design and development of production parts are expensed as incurred, unless the costs are reimbursable by the customer. As of October 28, 2023 and April 29, 2023, the Company had $ 44.5 million and $ 36.1 million, respectively, of pre-production tooling costs related to customer-owned tools for which reimbursement is contractually guaranteed by the customer or for which the customer has provided a non-cancelable right to use the tooling. Costs for molds, dies and other tools used in products produced for its customers under long-term supply arrangements for which the Company has title are capitalized in property, plant and equipment and amortized over the shorter of the life of the arrangement or the estimated useful life of the assets. As of October 28, 2023 and April 29, 2023 , Company-owned tooling was $ 15.6 million and $ 12.2 million, respectively. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 6 Months Ended |
Oct. 28, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Note 6. Goodwill and Other Intangible Assets Goodwill Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. A summary of the changes in the carrying amount of goodwill, by segment, is shown below: (in millions) Automotive Industrial Total Balance as of April 29, 2023 $ 106.2 $ 195.7 $ 301.9 Acquisition (Note 3) — ( 21.8 ) ( 21.8 ) Impairment ( 56.5 ) — ( 56.5 ) Foreign currency translation ( 0.3 ) ( 2.6 ) ( 2.9 ) Balance as of October 28, 2023 $ 49.4 $ 171.3 $ 220.7 The Company tests goodwill and indefinite-lived intangible assets for impairment on an annual basis as of the beginning of the fourth quarter each fiscal year. In addition, the Company continuously monitors for events and circumstances that could negatively impact the key assumptions used in determining fair value and therefore require interim goodwill impairment testing, including long-term revenue growth projections, profitability, discount rates, volatility in the Company's market capitalization, and general industry, market and macroeconomic conditions. As a result of sustained decreases in the Company’s publicly quoted share price, market capitalization and lower than expected operating results, the Company concluded that a triggering event had occurred requiring an interim goodwill impairment assessment. These factors suggested that the fair value of one or more of the Company's reporting units may have fallen below their carrying amounts. The Company quantitatively assessed its reporting units which have performed substantially below the forecast used in its last quantitative fair value test. The reporting units that were quantitatively assessed were North American Automotive ("NAA") and European Automotive ("EA"). The Company engaged a third-party valuation specialist to assist management in performing the interim goodwill impairment assessment. The fair value of the NAA and EA reporting units were estimated using a combination of the income approach and market approach, weighted accordingly for the specific circumstances of the reporting unit. The income approach uses a discounted cash flow method and the market approach uses appropriate valuation multiples observed for the reporting unit’s guideline public companies. The determination of discounted cash flows are based on management’s estimates of revenue growth rates and earnings before interest, taxes, depreciation and amortization (“EBITDA”) margins, taking into consideration business and market conditions for the countries and markets in which the reporting unit operates. The Company calculates the discount rate based on a market-participant, risk-adjusted weighted average cost of capital, which considers industry specific rates of return on debt and equity capital for a target industry capital structure, adjusted for risks associated with business size, geography and other factors specific to the reporting unit. Long-range forecasting involves uncertainty which increases with each successive period. Revenue growth rates and profitability assumptions, especially in the outer years, involve a greater degree of uncertainty. Based upon the results of the quantitative impairment test, the Company determined the carrying value of the NAA and EA reporting units exceeded their fair value at October 28, 2023. As a result, the Company recognized a non-cash goodwill impairment charge of $ 56.5 million ($ 50.4 million for NAA and $ 6.1 million for EA, respectively) in the three and six months ended October 28, 2023, which was determined as the excess carrying value over fair value of the respective reporting unit up to the carrying value of the goodwill immediately prior to the impairment. Any significant changes to the assumptions regarding future performance, an adverse change to macroeconomic conditions, a further reduction in the Company's market capitalization, or a change to other assumptions could result in impairment losses in the future, which could be significant. A summary of goodwill by reporting unit is as follows: (in millions) October 28, 2023 April 29, 2023 Grakon Industrial $ 123.9 $ 124.5 North American Automotive 49.4 99.8 Nordic Lights 45.8 69.6 European Automotive — 6.4 Other 1.6 1.6 Total $ 220.7 $ 301.9 Other intangible assets, net Details of identifiable intangible assets are shown below: As of October 28, 2023 (in millions) Gross Accumulated Net Weighted average remaining useful life (years) Amortized intangible assets: Customer relationships and agreements $ 303.6 $ ( 76.1 ) $ 227.5 15.2 Trade names, patents and technology licenses 74.0 ( 38.6 ) 35.4 7.1 Total amortized intangible assets 377.6 ( 114.7 ) 262.9 Unamortized trade name 1.8 — 1.8 Total other intangible assets $ 379.4 $ ( 114.7 ) $ 264.7 As of April 29, 2023 (in millions) Gross Accumulated Net Weighted average remaining useful life (years) Amortized intangible assets: Customer relationships and agreements $ 286.7 $ ( 68.2 ) $ 218.5 14.8 Trade names, patents and technology licenses 71.6 ( 35.2 ) 36.4 6.0 Total amortized intangible assets 358.3 ( 103.4 ) 254.9 Unamortized trade name 1.8 — 1.8 Total other intangible assets $ 360.1 $ ( 103.4 ) $ 256.7 Based on the current amount of intangible assets subject to amortization, the estimated aggregate amortization expense for each of the five succeeding fiscal years and thereafter is as follows: (in millions) Fiscal Year: Remainder of 2024 $ 11.8 2025 23.1 2026 22.2 2027 21.6 2028 19.3 Thereafter 164.9 Total $ 262.9 |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 6 Months Ended |
Oct. 28, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | Note 7. Derivative Instruments and Hedging Activities The Company is exposed to various market risks including, but not limited to, foreign currency exchange rates and market interest rates. The Company strives to control its exposure to these risks through our normal operating activities and, where appropriate, through the use of derivative financial instruments. Derivative financial instruments are measured at fair value on a recurring basis. For a designated cash flow hedge, the effective portion of the change in the fair value of the derivative financial instrument is recorded in accumulated other comprehensive income (“AOCI”) in the condensed consolidated balance sheets. When the underlying hedged transaction is realized, the gain or loss previously included in AOCI is recorded in earnings and reflected in the condensed consolidated statements of income on the same line as the gain or loss on the hedged item attributable to the hedged risk. The gain or loss associated with changes in the fair value of derivatives not designated as hedges are recorded immediately in the condensed consolidated statements of income on the same line as the associated risk. For a designated net investment hedge, the effective portion of the change in the fair value of the derivative financial instrument is recorded as a cumulative translation adjustment in AOCI in the condensed consolidated balance sheets. Net investment hedges The Company is exposed to the risk that adverse changes in foreign currency exchange rates could impact its net investment in non-U.S. subsidiaries. To manage this risk, the Company designates certain qualifying derivative and non-derivative instruments, including cross-currency swaps and foreign currency-denominated debt, as net investment hedges of certain non-U.S. subsidiaries. The Company had a variable-rate, cross-currency swap, with a notional value of $ 60.0 million (€ 54.8 million), that matured on August 31, 2023 with a gain of approximately $ 0.6 million. The cross-currency swap was designated as a hedge of the Company’s net investment in its euro-denominated subsidiaries. The gain will remain in AOCI until the hedged net investment is sold or substantially liquidated. Hedge effectiveness is assessed at the inception of the hedging relationship and quarterly thereafter, under the spot-to-spot method. The Company recognizes the impact of all other changes in fair value of the derivative, which represents the interest rate differential of the cross-currency swap, through interest expense. For the three months ended October 28, 2023 and October 29, 2022 , the Company recorded gains of $ 0.4 million and $ 0.6 million, respectively, in interest expense, net in the condensed consolidated statements of income. For the six months ended October 28, 2023 and October 29, 2022 , the Company recorded gains of $ 1.1 million and $ 0.9 million, respectively, in interest expense, net in the condensed consolidated statements of income. The Company has also designated its euro-denominated long-term borrowings of $ 290.6 million under the Credit Agreement as a hedge of the Company's investment in its euro-denominated subsidiaries. The objective of the designation is to protect the net investment in the foreign operation against adverse changes in the euro exchange rate. The change in the value of the euro-denominated long-term borrowings, which is due to changes in foreign exchange rates, is recorded as a cumulative translation adjustment in AOCI, net of tax. For the three months ended October 28, 2023 , the transaction gain associated with this net investment hedge reported in AOCI was $ 7.5 million. For the six months ended October 28, 2023 the transaction gain associated with this net investment hedge reported in AOCI was $ 7.3 million. Interest rate swaps The Company utilizes interest rate swaps to limit its exposure to market fluctuations on its variable-rate borrowings. The interest rate swaps effectively convert a portion of the Company's variable rate borrowings to a fixed rate based upon a determined notional amount. The Company has an interest rate swap, maturing on October 31, 2027 , with a notional value of $ 145.5 million (€ 132.0 million) and had two interest rate swaps that matured on August 31, 2023 , with a notional value of $ 100.0 million. The interest rate swaps are designated as cash flow hedges. Hedge effectiveness is assessed at the inception of the hedging relationship and quarterly thereafter. The effective portion of the periodic changes in fair value is recognized in AOCI in the condensed consolidated balance sheets. Subsequently, the accumulated gains and losses recorded in AOCI are reclassified to income in the period during which the hedged cash flow impacts earnings, which are expected to be immaterial over the next 12 months. No ineffectiveness was recognized in the three or six months ended October 28, 2023 and October 29, 2022. Derivatives not designated as hedges The Company uses short-term foreign currency forward contracts to reduce the earnings impact that exchange rate fluctuations have on non-functional currency balance sheet exposures. These forward contracts are not designated as hedging instruments. Gains and losses on these forward contracts are recognized in other income, net, along with the foreign currency gains and losses on monetary assets and liabilities, in the condensed consolidated statements of income. As of October 28, 2023 and April 29, 2023 , the Company held foreign currency forward contracts with a notional value of $ 71.9 million and $ 59.9 million, respectively. During the three and six months ended October 28, 2023 , the Company recognized a loss of $ 0.8 million and $ 2.7 million, respectively, related to foreign currency forward contracts in the condensed consolidated statements of income. During the three and six months ended October 29, 2022 , the Company recognized a loss of $ 2.4 million and $ 2.8 million, respectively, related to foreign currency forward contracts in the condensed consolidated statements of income. Fair value of derivative instruments on the balance sheet The fair value of derivative instruments are classified as Level 2 within the fair value hierarchy and are recorded in the balance sheets as follows: Asset/(Liability) (in millions) Financial Statement Caption October 28, 2023 April 29, 2023 Derivatives designated as hedging instruments: Net investment hedges Other accrued liabilities $ — $ ( 0.5 ) Interest rate swaps Prepaid expenses and other current assets $ — $ 1.6 Interest rate swaps Other long-term liabilities $ ( 1.1 ) $ — Derivatives not designated as hedging instruments: Foreign currency forward contracts Prepaid expenses and other current assets $ — $ 0.1 Foreign currency forward contracts Other accrued liabilities $ ( 0.1 ) $ ( 0.1 ) Effect of derivative instruments on comprehensive income (loss) Gross amounts recorded in other comprehensive income (loss) were as follows: Three Months Ended Six Months Ended (in millions) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 Net investment hedges $ 1.1 $ 1.4 $ 1.2 $ 3.4 Interest rate swaps ( 0.4 ) 0.7 ( 2.7 ) 0.7 Total $ 0.7 $ 2.1 $ ( 1.5 ) $ 4.1 |
Debt
Debt | 6 Months Ended |
Oct. 28, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Note 8. Debt A summary of debt is shown below: (in millions) October 28, 2023 April 29, 2023 Revolving credit facility $ 330.6 $ 305.4 Other debt 4.4 4.7 Unamortized debt issuance costs ( 3.0 ) ( 3.3 ) Total debt 332.0 306.8 Less: current maturities ( 3.0 ) ( 3.2 ) Total long-term debt $ 329.0 $ 303.6 Revolving credit facility/term loan On October 31, 2022, the Company entered into a Second Amended and Restated Credit Agreement (the “Credit Agreement”) among the Company, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and the Lenders and other parties named therein. The Credit Agreement amends and restates the Amended and Restated Credit Agreement, dated September 12, 2018 and as previously amended (the “Prior Credit Agreement”), among the Company, Bank of America, N.A., as Administrative Agent, Swing Line Lender, and L/C Issuer, Wells Fargo Bank, National Association, as L/C Issuer, and the Lenders named therein. Among other things, the Credit Agreement (i) increased the multicurrency revolving credit commitments under the Prior Credit Agreement to $ 750,000,000 , (ii) refinanced in full and terminated the term loan facility under the Prior Credit Agreement, and (iii) made certain other changes to the covenants, terms, and conditions under the Prior Credit Agreement. In addition, the Credit Agreement permits the Company to increase the revolving commitments and/or add one or more tranches of term loans under the Credit Agreement from time to time by up to an amount equal to (i) $ 250,000,000 plus (ii) an additional amount so long as the leverage ratio would not exceed 3.00 :1.00 on a pro forma basis, subject to, among other things, the receipt of additional commitments from existing and/or new lenders. The Credit Agreement matures on October 31, 2027 . Loans denominated in US dollars under the Credit Agreement bear interest at either (a) an adjusted base rate or (b) an adjusted term Secured Overnight Financing Rate (“SOFR”) rate or term SOFR daily floating rate (in each case, as determined in accordance with the provisions of the Credit Agreement) in each case plus an applicable rate (the “Applicable Rate”) ranging between 0.375 % and 1.25 %, in the case of adjusted base rate loans, and between 1.375 % and 2.25 %, in the case of adjusted term SOFR rate loans and term SOFR daily floating rate loans. Loans denominated in euros will bear interest at the Euro Interbank Offered Rate plus an Applicable Rate ranging between 1.375 % and 2.25 %. The Applicable Rate is set based on the Company’s consolidated leverage ratio. As of October 28, 2023 , the outstanding balance under the revolving credit facility included $ 290.6 million (€ 275.0 million) of euro-denominated borrowings. The Company has designated the euro-denominated borrowings as a net investment hedge of the foreign currency exposure of its investments in euro-denominated subsidiaries. Refer to Note 7, "Derivative Financial Instruments and Hedging Activities" for further information. The weighted-average interest rate on outstanding US dollar and euro-denominated borrowings under the Credit Agreement was approximately 7.2 % and 5.6 %, respectively, as of October 28, 2023. The Credit Agreement contains customary representations and warranties, financial covenants, restrictive covenants and events of default. As of October 28, 2023, the Company was in compliance with all the covenants in the Credit Agreement. Other debt One of the Company’s European subsidiaries has debt that consists of three notes with maturities ranging from 2023 to 2031. The weighted-average interest rate on this debt was approximately 1.4 % at October 28, 2023 and $ 3.0 million of the debt was classified as short-term. |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Oct. 28, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Shareholders' Equity | Note 9. Shareholders’ Equity Share buyback program The Board of Directors authorized a program to purchase up to $ 200.0 million of the Company’s outstanding common stock through June 14, 2024. Purchases may be made in private transactions or on the open market, including pursuant to purchase plans designed to comply with Rule 10b5-1 of the Securities Exchange Act of 1934. The following table summarizes the Company’s stock buyback activity under this share buyback program: Three Months Ended Six Months Ended (in millions, except share and per share data) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 Shares purchased 322,779 508,179 322,779 825,814 Average price per share $ 24.03 $ 38.69 $ 24.03 $ 38.21 Total cost $ 7.8 $ 19.7 $ 7.8 31.6 As of October 28, 2023, a total of 3,113,154 shares have been purchased at a total cost of $ 127.1 million since the commencement of the share buyback program. All purchased shares were retired and are reflected as a reduction of common stock for the par value of shares, with the excess applied as a reduction to retained earnings. As of October 28, 2023, the dollar value of shares that remained available to be purchased by the Company under this share buyback program was $ 72.9 million. Dividends The Company paid dividends totaling $ 4.8 million and $ 4.9 million in the three months ended October 28, 2023 and October 29, 2022, respectively. The Company paid dividends totaling $ 10.1 million and $ 9.9 million in the six months ended October 28, 2023 and October 29, 2022, respectively. Dividends paid in the six months ended October 28, 2023 include $ 0.4 million of dividend equivalent payments for restricted stock units that vested at the end of fiscal 2023. Accumulated other comprehensive income (loss) Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. A summary of changes in AOCI, net of tax is shown below: Three Months Ended October 28, 2023 Six Months Ended October 28, 2023 (in millions) Currency translation adjustments Derivative instruments Total Currency translation adjustments Derivative instruments Total Balance at beginning of period $ ( 22.3 ) $ ( 0.8 ) $ ( 23.1 ) $ ( 19.8 ) $ 0.8 $ ( 19.0 ) Other comprehensive income (loss) ( 17.6 ) 0.7 ( 16.9 ) ( 20.3 ) ( 1.5 ) ( 21.8 ) Tax (expense) benefit ( 2.6 ) ( 0.3 ) ( 2.9 ) ( 2.4 ) 0.3 ( 2.1 ) Net other comprehensive income (loss) ( 20.2 ) 0.4 ( 19.8 ) ( 22.7 ) ( 1.2 ) ( 23.9 ) Balance at the end of period $ ( 42.5 ) $ ( 0.4 ) $ ( 42.9 ) $ ( 42.5 ) $ ( 0.4 ) $ ( 42.9 ) Three Months Ended October 29, 2022 Six Months Ended October 29, 2022 (in millions) Currency translation adjustments Derivative instruments Total Currency translation adjustments Derivative instruments Total Balance at beginning of period $ ( 41.4 ) $ 5.2 $ ( 36.2 ) $ ( 30.5 ) $ 3.7 $ ( 26.8 ) Other comprehensive income (loss) ( 19.9 ) 2.1 ( 17.8 ) ( 30.8 ) 4.1 ( 26.7 ) Tax (expense) benefit 0.2 ( 0.5 ) ( 0.3 ) 0.2 ( 1.0 ) ( 0.8 ) Net other comprehensive income (loss) ( 19.7 ) 1.6 ( 18.1 ) ( 30.6 ) 3.1 ( 27.5 ) Balance at the end of period $ ( 61.1 ) $ 6.8 $ ( 54.3 ) $ ( 61.1 ) $ 6.8 $ ( 54.3 ) Stock-based compensation The Company has granted stock options, restricted stock awards (“RSAs”), performance units (“PUs”), restricted stock units (“RSUs”) and stock awards to employees and non-employee directors under the Methode Electronics, Inc. 2022 Omnibus Incentive Plan (“2022 Plan”), the Methode Electronics, Inc. 2014 Omnibus Incentive Plan (“2014 Plan”), the Methode Electronics, Inc. 2010 Stock Plan (“2010 Plan”), and the Methode Electronics, Inc. 2004 Stock Plan (“2004 Plan”). The Company’s stockholders approved the 2022 Plan on September 14, 2022. The Company can no longer make grants under the 2014 Plan, 2010 Plan and 2004 Plan. Subject to adjustment as provided in the 2022 Plan and the 2022 Plan’s share counting provisions, the number of shares of the Company's common stock that will be available for all awards under the 2022 Plan is 5,550,000 , less one share for every one share of common stock subject to an option or SAR award granted after April 30, 2022 under the 2014 Plan and 2.28 shares for every one share that was subject to an award other than an option or SAR granted after April 30, 2022 under the 2014 Plan. As of October 28, 2023 , there were 4,943,780 shares available for award under the 2022 Plan. Restricted stock awards and performance units As of October 28, 2023 , the Company had 933,674 RSAs outstanding which may be earned based on the achievement of an earnings before net interest, taxes, fixed asset depreciation and intangible asset amortization (“EBITDA”) measure for fiscal 2025. The RSAs will vest ranging from 0 % (for performance below threshold) to 100 % (target performance) based on the achievement of the EBITDA performance measure and continued employment. In addition, if the target performance is exceeded, up to an additional 466,837 PUs can be earned that will be settled in cash. At the discretion of the Compensation Committee, the PUs may be settled in shares of common stock. The fair value of the RSAs was based on the closing stock price on the date of grant and the RSAs earn dividend equivalents during the vesting period, which are forfeitable if the RSAs do not vest. Compensation expense for the RSAs is recognized when it is probable the minimum threshold performance criteria will be achieved. Compensation expense for the PUs is recognized when it is probable that the target performance criteria will be exceeded. The Company assesses the probability of vesting at each balance sheet date and adjusts compensation costs based on the probability assessment. The cash-settled PUs represent a non-equity unit with a conversion value equal to the fair market value of a share of the Company’s common stock on the vesting date. The PUs are classified as liability awards due to the cash settlement feature and are re-measured at each balance sheet date. In accordance with ASC 718, based on projections of the Company’s current business portfolio, no compensation expense has been recognized for the RSAs or PUs to date, as the performance conditions are not probable of being met. Unrecognized stock-based compensation expense at target level of performance is $ 26.8 million as of October 28, 2023 , which, subject to the performance conditions being met, will be recognized through fiscal 2025. The following table summarizes RSA activity: Restricted Weighted Non-vested at April 29, 2023 933,674 $ 28.73 Awarded — $ — Vested — $ — Forfeited — $ — Non-vested at October 28, 2023 933,674 $ 28.73 Restricted stock units RSUs granted vest over a pre-determined period of time, up to five years from the date of grant. The fair value of the RSUs granted are based on the closing stock price on the date of grant and earn dividend equivalents during the vesting periods, which are forfeitable if the RSUs don’t vest. The following table summarizes RSU activity: Restricted Weighted Non-vested at April 29, 2023 727,467 $ 30.60 Awarded 207,050 $ 22.83 Vested ( 866 ) $ 38.24 Forfeited ( 13,474 ) $ 41.62 Non-vested at October 28, 2023 920,177 $ 28.68 Under the various stock plans, common stock underlying vested RSUs held by certain executives will not be delivered until termination of employment or a change of control of the Company. As of October 28, 2023 , common stock to be delivered to these executives totaled 577,055 shares. Director awards The Company grants stock awards to its non-employee directors as a component of their compensation. The stock awards vest immediately upon grant. Non-employee directors may elect to defer receipt of their shares under the Company’s non-qualified deferred compensation plan. The following table summarizes awards granted to non-employee directors: Non-employee director awards Deferred non-employee director awards Total Weighted Outstanding at April 29, 2023 — 45,750 45,750 $ 40.56 Awarded 16,804 30,194 46,998 $ 33.22 Issued ( 16,804 ) — ( 16,804 ) $ 33.32 Outstanding at October 28, 2023 — 75,944 75,944 $ 37.62 Stock options The following table summarizes stock option activity: Stock Weighted average exercise price Weighted- Aggregate Outstanding and exercisable at April 29, 2023 20,000 $ 37.01 1.2 $ 0.1 Exercised — $ — Forfeited — $ — Outstanding and exercisable at October 28, 2023 20,000 $ 37.01 0.7 $ 0.0 The aggregate intrinsic value represents the total pre-tax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the period and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on that date. Stock-based compensation expense All stock-based awards to employees and non-employee directors are recognized in selling and administrative expenses on the condensed consolidated statements of income. Awards subject to graded vesting are recognized using the accelerated recognition method over the requisite service period. The table below summarizes the stock-based compensation expense related to the equity awards: Three Months Ended Six Months Ended (in millions) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 RSUs $ 1.3 $ 2.7 $ 2.3 $ 5.1 Deferred non-employee director awards — — 1.0 1.0 Non-employee director awards — — 0.6 0.6 Total stock-based compensation expense $ 1.3 $ 2.7 $ 3.9 $ 6.7 |
(Loss) Income per Share
(Loss) Income per Share | 6 Months Ended |
Oct. 28, 2023 | |
Earnings Per Share [Abstract] | |
(Loss) Income per Share | Note 10. (Loss) Income per Share Basic (loss) income per share attributable to Methode is calculated by dividing net (loss) income attributable to Methode by the weighted average number of common shares outstanding for the applicable period, but excludes any contingently issued shares where the contingency has not been resolved. The weighted average number of common shares used in the diluted (loss) income per share calculation is determined using the treasury stock method which includes the effect of all potential dilutive common shares outstanding during the period. The following table sets forth the computation of basic and diluted (loss) income per share attributable to Methode: Three Months Ended Six Months Ended October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 Numerator: Net (loss) income attributable to Methode (in millions) $ ( 55.3 ) $ 27.6 $ ( 54.4 ) $ 49.1 Denominator: Denominator for basic income per share - weighted average shares outstanding and vested/unissued restricted stock units 35,671,677 36,126,132 35,679,776 36,346,054 Dilutive potential common shares — 715,699 — 682,762 Denominator for diluted income per share 35,671,677 36,841,831 35,679,776 37,028,816 (Loss) income per share attributable to Methode: Basic $ ( 1.55 ) $ 0.76 $ ( 1.52 ) $ 1.35 Diluted $ ( 1.55 ) $ 0.75 $ ( 1.52 ) $ 1.33 Number of anti-dilutive potentially issuable shares excluded from diluted common shares outstanding 1,543,183 940,510 1,536,206 934,522 In the three and six months ended October 28, 2023 , all potential common shares issuable for stock options and RSUs were excluded from the calculation of diluted loss per share, as the effect of including them would have been anti-dilutive. The dilutive effect of potential common shares issuable for stock options and RSUs on the weighted-average number of common shares outstanding would have been approximately 584,000 and 589,000 common shares for the three and six months ended October 28, 2023 , respectively. |
Segment Information
Segment Information | 6 Months Ended |
Oct. 28, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | Note 11. Segment Information An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenues and incur expenses, and about which separate financial information is regularly evaluated by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources. The CODM is the Company’s President and Chief Executive Officer. The Company has four reporting segments as described below. The Automotive segment supplies electronic and electro-mechanical devices and related products to automobile OEMs, either directly or through their tiered suppliers. Products include integrated center consoles, hidden switches, ergonomic switches, transmission lead-frames, LED-based lighting and sensors, which incorporate magneto-elastic sensing and other technologies that monitor the operation or status of a component or system. The Industrial segment manufactures external lighting solutions, industrial safety radio remote controls, braided flexible cables, current-carrying laminated busbars and devices, custom power-product assemblies, such as our PowerRail® solution, high-current low-voltage flexible power cabling systems and powder-coated busbars that are used in various markets and applications, including aerospace, computers, industrial, power conversion, military, telecommunications and transportation. The Interface segment provides a variety of copper and fiber-optic interface and interface solutions for the appliance, commercial food service, construction, consumer, material handling, point-of-sale and telecommunications markets. Solutions include copper transceivers and solid-state field-effect consumer touch panels. The Medical segment is made up of the Company’s medical device business, Dabir Surfaces, with its surface support technology aimed at pressure injury prevention. Methode developed the technology for use by patients who are immobilized or otherwise at risk for pressure injuries, including patients undergoing long-duration surgical procedures. In the first quarter of fiscal 2024, the Company made the decision to initiate the discontinuation of Dabir Surfaces. In October 2023, the Company sold certain assets of its Dabir Surfaces business. See Note 3, "Acquisition and Disposition" for more information. The tables below present information about the Company’s reportable segments: Three Months Ended October 28, 2023 (in millions) Automotive Industrial Interface Medical Eliminations/ Consolidated Net sales $ 158.0 $ 128.0 $ 11.7 $ 1.6 $ ( 11.3 ) $ 288.0 Transfers between segments ( 3.7 ) ( 7.6 ) — — 11.3 — Net sales to unaffiliated customers $ 154.3 $ 120.4 $ 11.7 $ 1.6 $ — $ 288.0 Income (loss) from operations $ ( 61.5 ) $ 25.7 $ 1.0 $ ( 0.7 ) $ ( 15.8 ) $ ( 51.3 ) Interest expense, net 4.4 Other income, net ( 0.2 ) Pre-tax loss $ ( 55.5 ) Goodwill impairment $ 56.5 $ — $ — $ — $ — $ 56.5 Three Months Ended October 29, 2022 (in millions) Automotive Industrial Interface Medical Eliminations Consolidated Net sales $ 198.3 $ 107.8 $ 14.1 $ 1.1 $ ( 5.4 ) $ 315.9 Transfers between segments ( 1.4 ) ( 4.0 ) — — 5.4 — Net sales to unaffiliated customers $ 196.9 $ 103.8 $ 14.1 $ 1.1 $ — $ 315.9 Income (loss) from operations $ 23.4 $ 25.0 $ 1.6 $ ( 1.4 ) $ ( 15.8 ) $ 32.8 Interest expense, net 0.5 Other income, net ( 1.1 ) Pre-tax income $ 33.4 Six Months Ended October 28, 2023 (in millions) Automotive Industrial Interface Medical Eliminations/ Consolidated Net sales $ 319.1 $ 250.6 $ 27.0 $ 2.4 $ ( 21.4 ) $ 577.7 Transfers between segments ( 6.5 ) ( 14.8 ) ( 0.1 ) — 21.4 — Net sales to unaffiliated customers $ 312.6 $ 235.8 $ 26.9 $ 2.4 $ — $ 577.7 Income (loss) from operations $ ( 64.3 ) $ 49.9 $ 3.9 $ ( 2.9 ) $ ( 34.1 ) $ ( 47.5 ) Interest expense, net 7.2 Other income, net ( 0.2 ) Pre-tax loss $ ( 54.5 ) Goodwill impairment $ 56.5 $ — $ — $ — $ — $ 56.5 Six Months Ended October 29, 2022 (in millions) Automotive Industrial Interface Medical Eliminations Consolidated Net sales $ 375.6 $ 201.5 $ 27.1 $ 1.8 $ ( 7.7 ) $ 598.3 Transfers between segments ( 2.1 ) ( 5.6 ) — — 7.7 — Net sales to unaffiliated customers $ 373.5 $ 195.9 $ 27.1 $ 1.8 $ — $ 598.3 Income (loss) from operations $ 38.1 $ 47.4 $ 3.2 $ ( 2.9 ) $ ( 31.2 ) $ 54.6 Interest expense, net 0.5 Other income, net ( 5.2 ) Pre-tax income $ 59.3 (in millions) October 28, 2023 April 29, 2023 Identifiable assets: Automotive $ 643.3 $ 700.2 Industrial 636.8 672.3 Interface 117.5 127.2 Medical 0.8 6.2 Eliminations/Corporate 86.5 73.2 Total identifiable assets $ 1,484.9 $ 1,579.1 |
Contingencies
Contingencies | 6 Months Ended |
Oct. 28, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Note 12. Contingencies Certain litigation arising in the normal course of business is pending against us. The Company is, from time-to-time, subject to various legal actions and claims incidental to our business, including those arising out of alleged defects, breach of contracts, employment-related matters, environmental matters and intellectual property matters. The Company considers insurance coverage and third-party indemnification when determining required accruals for pending litigation and claims. Although the outcome of potential legal actions and claims cannot be determined, it is the Company's opinion, based on the information available, that it has adequate reserves for these liabilities. Hetronic Germany-GmbH Matters For several years, Hetronic Germany-GmbH and Hydronic-Steuersysteme-GmbH (the “Fuchs companies”) served as our distributors for Germany, Austria and other central and eastern European countries pursuant to their respective intellectual property licenses and distribution and assembly agreements. The Company became aware that the Fuchs companies and their managing director, Albert Fuchs, had materially violated those agreements. As a result, the Company terminated all of its agreements with the Fuchs companies. On June 20, 2014, the Company filed a lawsuit against the Fuchs companies in the Federal District Court for the Western District of Oklahoma alleging material breaches of the distribution and assembly agreements and seeking damages, as well as various forms of injunctive relief. The defendants filed counterclaims alleging breach of contract, interference with business relations and business slander. On April 2, 2015, the Company amended its complaint against the Fuchs companies to add additional unfair competition and Lanham Act claims and to add additional affiliated parties. A trial with respect to the matter began in February 2020. During the trial, the defendants dismissed their one remaining counterclaim with prejudice. On March 2, 2020, the jury returned a verdict in favor of the Company. The verdict included approximately $ 102 million in compensatory damages and $ 11 million in punitive damages. On April 22, 2020, the District Court entered a permanent injunction barring defendants from selling infringing products and ordering them to return Hetronic’s confidential information. Defendants appealed entry of the permanent injunction. On May 29, 2020, the District Court held defendants in contempt for violating the permanent injunction and entered the final judgment. Defendants appealed entry of the final monetary judgment as well. The appeal of the permanent injunction and the appeal of the final judgment were consolidated into a single appeal before the U.S. Court of Appeals for the Tenth Circuit. On August 24, 2021, the Tenth Circuit issued a decision affirming the lower court’s ruling with the exception that it instructed the District Court to modify the injunction from the entire world to all of the countries in which Hetronic sells its products. On April 20 and 21, 2022, the District Court held a hearing related to modifying the injunction pursuant to the Tenth Circuit’s opinion, and the parties have filed post-hearing briefs. The defendants also filed a petition for certiorari with the United States Supreme Court seeking to further appeal the extraterritorial application of the Lanham Act in this case. The Company opposed that petition. The Supreme Court requested the views of the Solicitor General on the petition for certiorari, and the Solicitor General recommended granting the petition. On November 4, 2022, the Supreme Court granted the petition. The Supreme Court heard arguments in this matter on March 21, 2023. On June 29, 2023, the Supreme Court vacated the Tenth Circuit’s August 2021 decision and remanded the matter back to the Tenth Circuit for further proceedings. On September 1, 2023, the Tenth Circuit requested supplemental briefing from the parties regarding the effect of the Supreme Court’s decision on the appeal and the proper course of further proceedings. That briefing was thereafter submitted. Like any judgment, particularly a judgment involving defendants outside of the United States, there is no guarantee that the Company will be able to collect all or any portion of the judgment. Furthermore, defendants Abitron Germany and Hetronic Germany filed for insolvency in German court in September and October 2023 respectively, and the Germany insolvency court then appointed a receiver. These insolvency proceedings could potentially adversely impact our ability to enforce or collect upon the judgment or portions of the judgment or otherwise pursue or enforce claims or rights against those defendants. |
Restructuring
Restructuring | 6 Months Ended |
Oct. 28, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Note 13. Restructuring The Company continually monitors market factors and industry trends and takes restructuring actions to reduce overall costs and improve operational profitability as appropriate. Restructuring actions generally result in charges for employee termination benefits, plant closures, asset impairments and contract termination costs. As noted above, the Company made the decision to initiate the discontinuation of the Dabir business in the Medical segment. The Company recognized $ 0.4 million and $ 0.5 million of severance costs in the three and six months ended October 28, 2023, respectively, in selling and administrative expenses. In addition, in the six months ended October 28, 2023 , the Company recognized fixed asset impairment charges of $ 0.6 million in cost of products sold related to this restructuring action. In the Automotive segment, the Company recognized $ 0.2 million of severance costs in the three and six months ended October 28, 2023. In the three and six months ended October 29, 2022, restructuring costs primarily related to an impairment of an operating lease right-of-use asset. Employee termination benefits are accrued upon the commitment to a termination plan and when the benefit arrangement is communicated to affected employees, or when liabilities are determined to be probable and estimable. Asset impairment charges relate to the impairment of right-of-use lease assets and equipment. Components of restructuring costs were as follows: Three Months Ended Six Months Ended (in millions) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 Automotive $ 0.2 $ — $ 0.2 $ — Industrial — 0.4 — 0.5 Interface — — — — Medical 0.4 — 1.1 — Eliminations/Corporate — 0.1 — 0.1 Total restructuring costs $ 0.6 $ 0.5 $ 1.3 $ 0.6 Recognized in: Cost of products sold $ 0.2 $ 0.1 $ 0.8 $ 0.1 Selling and administrative expenses 0.4 0.4 0.5 0.5 $ 0.6 $ 0.5 $ 1.3 $ 0.6 The Company's restructuring liability was $ 0.1 million as of October 28, 2023. Estimates of restructuring costs are based on information available at the time such charges are recorded. Due to the inherent uncertainty involved in estimating restructuring costs, actual amounts paid for such activities may differ from amounts initially recorded. Accordingly, the Company may record revisions of previous estimates by adjusting previously established accruals. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Oct. 28, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 14. Subsequent Events On December 5, 2023, the Board of Directors of the Company removed Joseph Khoury from his position as Chief Operating Officer of the Company, and Mr. Khoury was terminated as an employee of the Company’s Egyptian subsidiary and is no longer associated with the Company. Mr. Khoury was placed on leave from that position on July 10, 2023, as previously reported in the Company’s Current Report on Form 8-K filed on July 14, 2023. As previously disclosed, multiple other officers of the Company have assumed Mr. Khoury’s management duties during this period, while remaining in their current positions and as a result, the Company has eliminated the position of Chief Operating Officer for the present time following Mr. Khoury’s departure from Methode. As a result, the Company expects to reverse between $3.5 million and $3.9 million of previously recognized compensation expense in the third quarter of fiscal 2024. On December 6, 2023, the Board of Directors of the Company declared a quarterly dividend of $0.14 per share to be paid on January 26, 2024, to common stockholders of record at the close of business on January 12, 2024. |
Description of Business and S_2
Description of Business and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Oct. 28, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of presentation The unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). All intercompany balances and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. These interim condensed consolidated financial statements include all adjustments (consisting of normal recurring adjustments, except as otherwise disclosed) that management believes are necessary for a fair presentation of the results of operations, financial position and cash flows of the Company for the interim periods presented. These financial statements should be read in conjunction with the consolidated financial statements included in the Company’s Form 10-K for the year ended April 29, 2023, filed with the SEC on June 27, 2023. Results may vary from quarter to quarter for reasons other than seasonality. |
Financial Reporting Periods | Financial reporting periods The Company maintains its financial records on the basis of a 52- or 53-week fiscal year ending on the Saturday closest to April 30. The three months ended October 28, 2023 and October 29, 2022 were both 13 -week periods and the six months ended October 28, 2023 and October 29, 2022 were both 26 -week periods. |
Use of Estimates | Use of estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes. These estimates and assumptions are subject to an inherent degree of uncertainty and may change, as new events occur, and additional information is obtained. As a result, actual results may differ from previously estimated amounts, and such differences may be material to the condensed consolidated financial statements. |
Recently Adopted Accounting Pronouncements | Recently adopted accounting pronouncements In October 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2021-08, “Business Combinations (Topic 805) – Accounting for Contract Assets and Contract Liabilities from Contracts with Customers,” which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured at the acquisition date in accordance with Accounting Standards Codification ("ASC") 606, as if the acquirer had originated the contracts. Prior to the issuance of this ASU, contract assets and liabilities were recognized at fair value on the acquisition date. The Company adopted this ASU in the first quarter of fiscal 2024 on a prospective basis. The adoption of this ASU did not have a material impact on its condensed consolidated financial statements or related disclosures and is only applicable to future business acquisitions. New accounting pronouncements not yet adopted In November 2023, the FASB issued ASU No. 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," which requires public entities to disclose information about their reportable segments’ significant expenses on an interim and annual basis. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Entities must adopt the changes to the segment reporting guidance on a retrospective basis. Early adoption is permitted. The adoption of this ASU will result in increased disclosures for the Company's segments. There have been no other newly issued or newly applicable accounting pronouncements that have had, or are expected to have, a material impact on the Company’s condensed consolidated financial statements. Further, at October 28, 2023, there are no other pronouncements pending adoption that are expected to have a material impact on the Company’s condensed consolidated financial statements. |
Summary of Significant Accounting Policies | Summary of significant accounting policies The Company’s significant accounting policies are described in Note 1, “Description of Business and Summary of Significant Accounting Policies,” to the consolidated financial statements included in the Company’s Form 10-K for the year ended April 29, 2023. There have been no material changes to the significant accounting policies in the six months ended October 28, 2023 . |
Revenue | From time to time, customers may negotiate annual price downs. Management has evaluated these price downs and determined that in some instances, these price downs give rise to a material right. In instances that a material right exists, a portion of the transaction price is allocated to the material right and recognized over the life of the contract. Across all products, the amount of revenue recognized corresponds to the related purchase order and is adjusted for variable consideration (such as discounts) and ongoing price adjustments. Sales and other taxes collected concurrent with revenue-producing activities are excluded from revenue. The Company’s performance obligations are typically short-term in nature. As a result, the Company has elected the practical expedient that provides an exemption from the disclosure requirements regarding information about remaining performance obligations on contracts that have original expected durations of one year or less. |
Inventory | Inventories are stated at the lower-of-cost or net realizable value. Cost is determined using the first-in, first-out method. Finished products and work-in-process inventories include direct material costs and direct and indirect manufacturing costs. The Company records reserves for inventory that may be obsolete or in excess of current and future market demand. |
Property, Plant and Equipment | Property, plant and equipment is stated at cost. Maintenance and repair costs are expensed as incurred. Depreciation is calculated using the straight-line method using estimated useful lives of 5 to 40 years for buildings and building improvements and 3 to 15 years for machinery and equipment. |
Income per Share | Basic (loss) income per share attributable to Methode is calculated by dividing net (loss) income attributable to Methode by the weighted average number of common shares outstanding for the applicable period, but excludes any contingently issued shares where the contingency has not been resolved. The weighted average number of common shares used in the diluted (loss) income per share calculation is determined using the treasury stock method which includes the effect of all potential dilutive common shares outstanding during the period. |
Contingencies | Certain litigation arising in the normal course of business is pending against us. The Company is, from time-to-time, subject to various legal actions and claims incidental to our business, including those arising out of alleged defects, breach of contracts, employment-related matters, environmental matters and intellectual property matters. The Company considers insurance coverage and third-party indemnification when determining required accruals for pending litigation and claims. Although the outcome of potential legal actions and claims cannot be determined, it is the Company's opinion, based on the information available, that it has adequate reserves for these liabilities. |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Oct. 28, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregated Revenue Information | The following table represents a disaggregation of revenue from contracts with customers by segment and geographical location. Net sales are attributed to regions based on the location of production. Though revenue recognition patterns and contracts are generally consistent, the amount, timing and uncertainty of revenue and cash flows may vary in each reportable segment due to geographic and economic factors. Three Months Ended October 28, 2023 (in millions) Automotive Industrial Interface Medical Total Geographic net sales: North America $ 70.9 $ 52.0 $ 11.7 $ 1.5 $ 136.1 Europe, the Middle East & Africa ("EMEA") 49.7 42.8 — — 92.5 Asia 33.7 25.6 — 0.1 59.4 Total net sales $ 154.3 $ 120.4 $ 11.7 $ 1.6 $ 288.0 Timing of revenue recognition: Goods transferred at a point in time $ 149.9 $ 120.4 $ 11.7 $ 1.6 $ 283.6 Goods transferred over time 4.4 — — — 4.4 Total net sales $ 154.3 $ 120.4 $ 11.7 $ 1.6 $ 288.0 Three Months Ended October 29, 2022 (in millions) Automotive Industrial Interface Medical Total Geographic net sales: North America $ 97.8 $ 40.1 $ 14.0 $ 1.1 $ 153.0 EMEA 53.9 37.9 — — 91.8 Asia 45.2 25.8 0.1 — 71.1 Total net sales $ 196.9 $ 103.8 $ 14.1 $ 1.1 $ 315.9 Timing of revenue recognition: Goods transferred at a point in time $ 192.3 $ 103.8 $ 14.1 $ 1.1 $ 311.3 Goods transferred over time 4.6 — — — 4.6 Total net sales $ 196.9 $ 103.8 $ 14.1 $ 1.1 $ 315.9 Six Months Ended October 28, 2023 (in millions) Automotive Industrial Interface Medical Total Geographic net sales: North America $ 137.7 $ 92.0 $ 26.9 $ 2.3 $ 258.9 EMEA 101.9 93.9 — — 195.8 Asia 73.0 49.9 — 0.1 123.0 Total net sales $ 312.6 $ 235.8 $ 26.9 $ 2.4 $ 577.7 Timing of revenue recognition: Goods transferred at a point in time $ 304.1 $ 235.8 $ 26.9 $ 2.4 $ 569.2 Goods transferred over time 8.5 — — — 8.5 Total net sales $ 312.6 $ 235.8 $ 26.9 $ 2.4 $ 577.7 Six Months Ended October 29, 2022 (in millions) Automotive Industrial Interface Medical Total Geographic net sales: North America $ 192.5 $ 80.8 $ 27.0 $ 1.8 $ 302.1 EMEA 106.0 66.4 — — 172.4 Asia 75.0 48.7 0.1 — 123.8 Total net sales $ 373.5 $ 195.9 $ 27.1 $ 1.8 $ 598.3 Timing of revenue recognition: Goods transferred at a point in time $ 364.4 $ 195.9 $ 27.1 $ 1.8 $ 589.2 Goods transferred over time 9.1 — — — 9.1 Total net sales $ 373.5 $ 195.9 $ 27.1 $ 1.8 $ 598.3 |
Acquisition and Disposition (Ta
Acquisition and Disposition (Tables) | 6 Months Ended |
Oct. 28, 2023 | |
Acquisitions and Dispositions Disclosure [Abstract] | |
Preliminary Fair Value and Subsequent Measurement Period Adjustments of Assets Acquired and Liabilities Assumed, Including Reconciliation to Total Purchase Price | The preliminary fair value and subsequent measurement period adjustments of the assets acquired and liabilities assumed, including a reconciliation to the total purchase price, were as follows: As reported as of July 29, 2023 Measurement period adjustments As of October 28, 2023 (in millions) Cash and cash equivalents $ 19.6 $ — $ 19.6 Accounts receivable 17.1 — 17.1 Inventories 9.6 ( 0.2 ) 9.4 Property, plant and equipment 12.9 3.4 16.3 Identifiable intangible assets 68.1 24.5 92.6 Accounts payable ( 10.8 ) — ( 10.8 ) Long-term debt ( 24.4 ) — ( 24.4 ) Other assets and liabilities, net ( 2.8 ) ( 0.5 ) ( 3.3 ) Deferred tax liabilities ( 13.4 ) ( 5.4 ) ( 18.8 ) Total identifiable net assets acquired 75.9 21.8 97.7 Goodwill 69.6 ( 21.8 ) 47.8 Total fair value of net assets acquired 145.5 — 145.5 Less: redeemable noncontrolling interest ( 11.3 ) — ( 11.3 ) Total purchase price $ 134.2 $ — $ 134.2 |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Oct. 28, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax (Benefit) Expense And Effective Tax Rate | The Company’s income tax (benefit) expense and effective tax rate for the three and six months ended October 28, 2023 and October 29, 2022 were as follows: Three Months Ended Six Months Ended ($ in millions) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 Pre-tax (loss) income $ ( 55.5 ) $ 33.4 $ ( 54.5 ) $ 59.3 Income tax (benefit) expense $ ( 0.2 ) 5.8 $ ( 0.1 ) 10.2 Effective tax rate 0.4 % 17.4 % 0.2 % 17.2 % |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 6 Months Ended |
Oct. 28, 2023 | |
Balance Sheet Components [Abstract] | |
Summary of Inventories | A summary of inventories is shown below: (in millions) October 28, 2023 April 29, 2023 Finished products $ 47.3 $ 36.6 Work in process 17.7 14.4 Raw materials 118.9 108.7 Total inventories $ 183.9 $ 159.7 |
Summary of Property, Plant and Equipment | A summary of property, plant and equipment is shown below: (in millions) October 28, 2023 April 29, 2023 Land $ 3.0 $ 3.0 Buildings and building improvements 99.5 98.8 Machinery and equipment 411.4 414.3 Construction in progress 48.0 40.6 Total property, plant and equipment, gross 561.9 556.7 Less: accumulated depreciation ( 337.3 ) ( 336.4 ) Property, plant and equipment, net $ 224.6 $ 220.3 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Oct. 28, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of the Changes in the Carrying Amount of Goodwill by Segment | A summary of the changes in the carrying amount of goodwill, by segment, is shown below: (in millions) Automotive Industrial Total Balance as of April 29, 2023 $ 106.2 $ 195.7 $ 301.9 Acquisition (Note 3) — ( 21.8 ) ( 21.8 ) Impairment ( 56.5 ) — ( 56.5 ) Foreign currency translation ( 0.3 ) ( 2.6 ) ( 2.9 ) Balance as of October 28, 2023 $ 49.4 $ 171.3 $ 220.7 |
Summary of Goodwill by Reporting Unit | A summary of goodwill by reporting unit is as follows: (in millions) October 28, 2023 April 29, 2023 Grakon Industrial $ 123.9 $ 124.5 North American Automotive 49.4 99.8 Nordic Lights 45.8 69.6 European Automotive — 6.4 Other 1.6 1.6 Total $ 220.7 $ 301.9 |
Schedule of Other Intangible Assets, Net | Details of identifiable intangible assets are shown below: As of October 28, 2023 (in millions) Gross Accumulated Net Weighted average remaining useful life (years) Amortized intangible assets: Customer relationships and agreements $ 303.6 $ ( 76.1 ) $ 227.5 15.2 Trade names, patents and technology licenses 74.0 ( 38.6 ) 35.4 7.1 Total amortized intangible assets 377.6 ( 114.7 ) 262.9 Unamortized trade name 1.8 — 1.8 Total other intangible assets $ 379.4 $ ( 114.7 ) $ 264.7 As of April 29, 2023 (in millions) Gross Accumulated Net Weighted average remaining useful life (years) Amortized intangible assets: Customer relationships and agreements $ 286.7 $ ( 68.2 ) $ 218.5 14.8 Trade names, patents and technology licenses 71.6 ( 35.2 ) 36.4 6.0 Total amortized intangible assets 358.3 ( 103.4 ) 254.9 Unamortized trade name 1.8 — 1.8 Total other intangible assets $ 360.1 $ ( 103.4 ) $ 256.7 |
Schedule of Estimated Aggregate Amortization Expense of Intangible Assets | Based on the current amount of intangible assets subject to amortization, the estimated aggregate amortization expense for each of the five succeeding fiscal years and thereafter is as follows: (in millions) Fiscal Year: Remainder of 2024 $ 11.8 2025 23.1 2026 22.2 2027 21.6 2028 19.3 Thereafter 164.9 Total $ 262.9 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 6 Months Ended |
Oct. 28, 2023 | |
Text Block [Abstract] | |
Schedule of Fair Value of Derivative Instruments Classified as Level 2 Within Fair Value Recorded in the Balance Sheet | The fair value of derivative instruments are classified as Level 2 within the fair value hierarchy and are recorded in the balance sheets as follows: Asset/(Liability) (in millions) Financial Statement Caption October 28, 2023 April 29, 2023 Derivatives designated as hedging instruments: Net investment hedges Other accrued liabilities $ — $ ( 0.5 ) Interest rate swaps Prepaid expenses and other current assets $ — $ 1.6 Interest rate swaps Other long-term liabilities $ ( 1.1 ) $ — Derivatives not designated as hedging instruments: Foreign currency forward contracts Prepaid expenses and other current assets $ — $ 0.1 Foreign currency forward contracts Other accrued liabilities $ ( 0.1 ) $ ( 0.1 ) |
Schedule of Derivative Instruments Effect on Other Comprehensive Income (Loss) | Gross amounts recorded in other comprehensive income (loss) were as follows: Three Months Ended Six Months Ended (in millions) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 Net investment hedges $ 1.1 $ 1.4 $ 1.2 $ 3.4 Interest rate swaps ( 0.4 ) 0.7 ( 2.7 ) 0.7 Total $ 0.7 $ 2.1 $ ( 1.5 ) $ 4.1 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Oct. 28, 2023 | |
Debt Disclosure [Abstract] | |
Summary of Debt | A summary of debt is shown below: (in millions) October 28, 2023 April 29, 2023 Revolving credit facility $ 330.6 $ 305.4 Other debt 4.4 4.7 Unamortized debt issuance costs ( 3.0 ) ( 3.3 ) Total debt 332.0 306.8 Less: current maturities ( 3.0 ) ( 3.2 ) Total long-term debt $ 329.0 $ 303.6 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 6 Months Ended |
Oct. 28, 2023 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Summary of Stock Buyback Activity Under Share Buyback Program | The following table summarizes the Company’s stock buyback activity under this share buyback program: Three Months Ended Six Months Ended (in millions, except share and per share data) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 Shares purchased 322,779 508,179 322,779 825,814 Average price per share $ 24.03 $ 38.69 $ 24.03 $ 38.21 Total cost $ 7.8 $ 19.7 $ 7.8 31.6 |
Summary of Changes in Accumulated Other Comprehensive Income (Loss), Net of Tax | A summary of changes in AOCI, net of tax is shown below: Three Months Ended October 28, 2023 Six Months Ended October 28, 2023 (in millions) Currency translation adjustments Derivative instruments Total Currency translation adjustments Derivative instruments Total Balance at beginning of period $ ( 22.3 ) $ ( 0.8 ) $ ( 23.1 ) $ ( 19.8 ) $ 0.8 $ ( 19.0 ) Other comprehensive income (loss) ( 17.6 ) 0.7 ( 16.9 ) ( 20.3 ) ( 1.5 ) ( 21.8 ) Tax (expense) benefit ( 2.6 ) ( 0.3 ) ( 2.9 ) ( 2.4 ) 0.3 ( 2.1 ) Net other comprehensive income (loss) ( 20.2 ) 0.4 ( 19.8 ) ( 22.7 ) ( 1.2 ) ( 23.9 ) Balance at the end of period $ ( 42.5 ) $ ( 0.4 ) $ ( 42.9 ) $ ( 42.5 ) $ ( 0.4 ) $ ( 42.9 ) Three Months Ended October 29, 2022 Six Months Ended October 29, 2022 (in millions) Currency translation adjustments Derivative instruments Total Currency translation adjustments Derivative instruments Total Balance at beginning of period $ ( 41.4 ) $ 5.2 $ ( 36.2 ) $ ( 30.5 ) $ 3.7 $ ( 26.8 ) Other comprehensive income (loss) ( 19.9 ) 2.1 ( 17.8 ) ( 30.8 ) 4.1 ( 26.7 ) Tax (expense) benefit 0.2 ( 0.5 ) ( 0.3 ) 0.2 ( 1.0 ) ( 0.8 ) Net other comprehensive income (loss) ( 19.7 ) 1.6 ( 18.1 ) ( 30.6 ) 3.1 ( 27.5 ) Balance at the end of period $ ( 61.1 ) $ 6.8 $ ( 54.3 ) $ ( 61.1 ) $ 6.8 $ ( 54.3 ) |
Summary of RSA and RSU Activity | The following table summarizes RSA activity: Restricted Weighted Non-vested at April 29, 2023 933,674 $ 28.73 Awarded — $ — Vested — $ — Forfeited — $ — Non-vested at October 28, 2023 933,674 $ 28.73 The following table summarizes RSU activity: Restricted Weighted Non-vested at April 29, 2023 727,467 $ 30.60 Awarded 207,050 $ 22.83 Vested ( 866 ) $ 38.24 Forfeited ( 13,474 ) $ 41.62 Non-vested at October 28, 2023 920,177 $ 28.68 |
Summary of Awards Granted to Non-employee Directors | The following table summarizes awards granted to non-employee directors: Non-employee director awards Deferred non-employee director awards Total Weighted Outstanding at April 29, 2023 — 45,750 45,750 $ 40.56 Awarded 16,804 30,194 46,998 $ 33.22 Issued ( 16,804 ) — ( 16,804 ) $ 33.32 Outstanding at October 28, 2023 — 75,944 75,944 $ 37.62 |
Summary of combined stock option activity and related information for stock options granted | The following table summarizes stock option activity: Stock Weighted average exercise price Weighted- Aggregate Outstanding and exercisable at April 29, 2023 20,000 $ 37.01 1.2 $ 0.1 Exercised — $ — Forfeited — $ — Outstanding and exercisable at October 28, 2023 20,000 $ 37.01 0.7 $ 0.0 |
Summary of Stock-based Compensation Expense Related to Equity Awards | The table below summarizes the stock-based compensation expense related to the equity awards: Three Months Ended Six Months Ended (in millions) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 RSUs $ 1.3 $ 2.7 $ 2.3 $ 5.1 Deferred non-employee director awards — — 1.0 1.0 Non-employee director awards — — 0.6 0.6 Total stock-based compensation expense $ 1.3 $ 2.7 $ 3.9 $ 6.7 |
(Loss) Income per Share (Tables
(Loss) Income per Share (Tables) | 6 Months Ended |
Oct. 28, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Income per Share | The following table sets forth the computation of basic and diluted (loss) income per share attributable to Methode: Three Months Ended Six Months Ended October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 Numerator: Net (loss) income attributable to Methode (in millions) $ ( 55.3 ) $ 27.6 $ ( 54.4 ) $ 49.1 Denominator: Denominator for basic income per share - weighted average shares outstanding and vested/unissued restricted stock units 35,671,677 36,126,132 35,679,776 36,346,054 Dilutive potential common shares — 715,699 — 682,762 Denominator for diluted income per share 35,671,677 36,841,831 35,679,776 37,028,816 (Loss) income per share attributable to Methode: Basic $ ( 1.55 ) $ 0.76 $ ( 1.52 ) $ 1.35 Diluted $ ( 1.55 ) $ 0.75 $ ( 1.52 ) $ 1.33 Number of anti-dilutive potentially issuable shares excluded from diluted common shares outstanding 1,543,183 940,510 1,536,206 934,522 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Oct. 28, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Reportable Segments | The tables below present information about the Company’s reportable segments: Three Months Ended October 28, 2023 (in millions) Automotive Industrial Interface Medical Eliminations/ Consolidated Net sales $ 158.0 $ 128.0 $ 11.7 $ 1.6 $ ( 11.3 ) $ 288.0 Transfers between segments ( 3.7 ) ( 7.6 ) — — 11.3 — Net sales to unaffiliated customers $ 154.3 $ 120.4 $ 11.7 $ 1.6 $ — $ 288.0 Income (loss) from operations $ ( 61.5 ) $ 25.7 $ 1.0 $ ( 0.7 ) $ ( 15.8 ) $ ( 51.3 ) Interest expense, net 4.4 Other income, net ( 0.2 ) Pre-tax loss $ ( 55.5 ) Goodwill impairment $ 56.5 $ — $ — $ — $ — $ 56.5 Three Months Ended October 29, 2022 (in millions) Automotive Industrial Interface Medical Eliminations Consolidated Net sales $ 198.3 $ 107.8 $ 14.1 $ 1.1 $ ( 5.4 ) $ 315.9 Transfers between segments ( 1.4 ) ( 4.0 ) — — 5.4 — Net sales to unaffiliated customers $ 196.9 $ 103.8 $ 14.1 $ 1.1 $ — $ 315.9 Income (loss) from operations $ 23.4 $ 25.0 $ 1.6 $ ( 1.4 ) $ ( 15.8 ) $ 32.8 Interest expense, net 0.5 Other income, net ( 1.1 ) Pre-tax income $ 33.4 Six Months Ended October 28, 2023 (in millions) Automotive Industrial Interface Medical Eliminations/ Consolidated Net sales $ 319.1 $ 250.6 $ 27.0 $ 2.4 $ ( 21.4 ) $ 577.7 Transfers between segments ( 6.5 ) ( 14.8 ) ( 0.1 ) — 21.4 — Net sales to unaffiliated customers $ 312.6 $ 235.8 $ 26.9 $ 2.4 $ — $ 577.7 Income (loss) from operations $ ( 64.3 ) $ 49.9 $ 3.9 $ ( 2.9 ) $ ( 34.1 ) $ ( 47.5 ) Interest expense, net 7.2 Other income, net ( 0.2 ) Pre-tax loss $ ( 54.5 ) Goodwill impairment $ 56.5 $ — $ — $ — $ — $ 56.5 Six Months Ended October 29, 2022 (in millions) Automotive Industrial Interface Medical Eliminations Consolidated Net sales $ 375.6 $ 201.5 $ 27.1 $ 1.8 $ ( 7.7 ) $ 598.3 Transfers between segments ( 2.1 ) ( 5.6 ) — — 7.7 — Net sales to unaffiliated customers $ 373.5 $ 195.9 $ 27.1 $ 1.8 $ — $ 598.3 Income (loss) from operations $ 38.1 $ 47.4 $ 3.2 $ ( 2.9 ) $ ( 31.2 ) $ 54.6 Interest expense, net 0.5 Other income, net ( 5.2 ) Pre-tax income $ 59.3 (in millions) October 28, 2023 April 29, 2023 Identifiable assets: Automotive $ 643.3 $ 700.2 Industrial 636.8 672.3 Interface 117.5 127.2 Medical 0.8 6.2 Eliminations/Corporate 86.5 73.2 Total identifiable assets $ 1,484.9 $ 1,579.1 |
Restructuring (Tables)
Restructuring (Tables) | 6 Months Ended |
Oct. 28, 2023 | |
Restructuring and Related Activities [Abstract] | |
Summary of Components of Restructuring Costs | Components of restructuring costs were as follows: Three Months Ended Six Months Ended (in millions) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022 Automotive $ 0.2 $ — $ 0.2 $ — Industrial — 0.4 — 0.5 Interface — — — — Medical 0.4 — 1.1 — Eliminations/Corporate — 0.1 — 0.1 Total restructuring costs $ 0.6 $ 0.5 $ 1.3 $ 0.6 Recognized in: Cost of products sold $ 0.2 $ 0.1 $ 0.8 $ 0.1 Selling and administrative expenses 0.4 0.4 0.5 0.5 $ 0.6 $ 0.5 $ 1.3 $ 0.6 |
Description of Business and S_3
Description of Business and Summary of Significant Accounting Policies (Details) | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | ||||
Fiscal period duration | 91 days | 91 days | 182 days | 182 days |
ASU 2021-08 | ||||
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | ||||
Change in accounting principle, accounting standards update, adopted [true false] | true | true | ||
Change in accounting principle, accounting standards update, immaterial effect [true false] | true | true |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 288 | $ 315.9 | $ 577.7 | $ 598.3 |
Automotive | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 154.3 | 196.9 | 312.6 | 373.5 |
Industrial | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 120.4 | 103.8 | 235.8 | 195.9 |
Interface | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 11.7 | 14.1 | 26.9 | 27.1 |
Medical | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1.6 | 1.1 | 2.4 | 1.8 |
Goods Transferred at a Point in Time | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 283.6 | 311.3 | 569.2 | 589.2 |
Goods Transferred at a Point in Time | Automotive | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 149.9 | 192.3 | 304.1 | 364.4 |
Goods Transferred at a Point in Time | Industrial | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 120.4 | 103.8 | 235.8 | 195.9 |
Goods Transferred at a Point in Time | Interface | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 11.7 | 14.1 | 26.9 | 27.1 |
Goods Transferred at a Point in Time | Medical | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1.6 | 1.1 | 2.4 | 1.8 |
Goods Transferred Over Time | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 4.4 | 4.6 | 8.5 | 9.1 |
Goods Transferred Over Time | Automotive | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 4.4 | 4.6 | 8.5 | 9.1 |
North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 136.1 | 153 | 258.9 | 302.1 |
North America | Automotive | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 70.9 | 97.8 | 137.7 | 192.5 |
North America | Industrial | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 52 | 40.1 | 92 | 80.8 |
North America | Interface | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 11.7 | 14 | 26.9 | 27 |
North America | Medical | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1.5 | 1.1 | 2.3 | 1.8 |
EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 92.5 | 91.8 | 195.8 | 172.4 |
EMEA | Automotive | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 49.7 | 53.9 | 101.9 | 106 |
EMEA | Industrial | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 42.8 | 37.9 | 93.9 | 66.4 |
Asia | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 59.4 | 71.1 | 123 | 123.8 |
Asia | Automotive | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 33.7 | 45.2 | 73 | 75 |
Asia | Industrial | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 25.6 | 25.8 | 49.9 | 48.7 |
Asia | Interface | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 0.1 | $ 0.1 | ||
Asia | Medical | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 0.1 | $ 0.1 |
Acquisition and Disposition - N
Acquisition and Disposition - Narrative (Details) € in Millions | 3 Months Ended | 6 Months Ended | ||||||
Oct. 13, 2023 USD ($) | Oct. 10, 2023 EUR (€) | Oct. 10, 2023 USD ($) | Apr. 20, 2023 EUR (€) | Apr. 20, 2023 USD ($) | Jul. 31, 2023 EUR (€) | Jul. 31, 2023 USD ($) | Oct. 28, 2023 USD ($) | |
Dabir Business | ||||||||
Acquisitions and Dispositions [Line Items] | ||||||||
Consideration from sale of business | $ 1,500,000 | |||||||
Loss on the sale of business, including transaction costs | $ (600,000) | |||||||
Finland | Nordic Lights | ||||||||
Acquisitions and Dispositions [Line Items] | ||||||||
Ownership percentage in subsidiary | 100% | 100% | ||||||
Finland | Nordic Lights | Maximum | ||||||||
Acquisitions and Dispositions [Line Items] | ||||||||
Ownership percentage of minority shareholders | 10% | |||||||
Nordic Lights | Finland | ||||||||
Acquisitions and Dispositions [Line Items] | ||||||||
Percentage acquired | 92.20% | 99.40% | 99.40% | |||||
Additional percentage acquired | 0.60% | 0.60% | 7.20% | 7.20% | ||||
Payments to acquire business in cash | € 0.8 | $ 900,000 | € 121.8 | $ 134,200,000 | € 9.2 | $ 10,200,000 | ||
Expected goodwill recognized to be deductible for income tax purposes | $ 0 | |||||||
Weighted average amortization period for acquired intangible assets | 18 years 2 months 12 days | 18 years 2 months 12 days | ||||||
Acquisition cost incurred | $ 500,000 |
Acquisition and Disposition - P
Acquisition and Disposition - Preliminary Fair Value and Subsequent Measurement Period Adjustments of Assets Acquired and Liabilities Assumed, Including Reconciliation to Total Purchase Price (Details) - USD ($) $ in Millions | Oct. 28, 2023 | Jul. 29, 2023 | Apr. 29, 2023 |
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||
Goodwill | $ 220.7 | $ 301.9 | |
Nordic Lights | Finland | |||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||
Cash and cash equivalents | 19.6 | ||
Accounts receivable | 17.1 | ||
Inventories | 9.4 | ||
Property, plant and equipment | 16.3 | ||
Identifiable intangible assets | 92.6 | ||
Accounts payable | (10.8) | ||
Long-term debt | (24.4) | ||
Other assets and liabilities, net | (3.3) | ||
Deferred tax liabilities | (18.8) | ||
Total identifiable net assets acquired | 97.7 | ||
Goodwill | 47.8 | ||
Total fair value of net assets acquired | 145.5 | ||
Less: redeemable noncontrolling interest | (11.3) | ||
Total purchase price | 134.2 | ||
Nordic Lights | Finland | As Reported as of July 29, 2023 | |||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||
Cash and cash equivalents | $ 19.6 | ||
Accounts receivable | 17.1 | ||
Inventories | 9.6 | ||
Property, plant and equipment | 12.9 | ||
Identifiable intangible assets | 68.1 | ||
Accounts payable | (10.8) | ||
Long-term debt | (24.4) | ||
Other assets and liabilities, net | (2.8) | ||
Deferred tax liabilities | (13.4) | ||
Total identifiable net assets acquired | 75.9 | ||
Goodwill | 69.6 | ||
Total fair value of net assets acquired | 145.5 | ||
Less: redeemable noncontrolling interest | (11.3) | ||
Total purchase price | $ 134.2 | ||
Nordic Lights | Finland | Measurement Period Adjustments | |||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||
Inventories | (0.2) | ||
Property, plant and equipment | 3.4 | ||
Identifiable intangible assets | 24.5 | ||
Other assets and liabilities, net | (0.5) | ||
Deferred tax liabilities | (5.4) | ||
Total identifiable net assets acquired | 21.8 | ||
Goodwill | $ (21.8) |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income before Income Taxes, Income Tax (Benefit) Expense and Effective Income Tax Rate (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Pre-tax (loss) income | $ (55.5) | $ 33.4 | $ (54.5) | $ 59.3 |
Income tax (benefit) expense | $ (0.2) | $ 5.8 | $ (0.1) | $ 10.2 |
Effective tax rate | 0.40% | 17.40% | 0.20% | 17.20% |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | Apr. 29, 2023 | |
Income Tax Examination [Line Items] | |||||
Income tax at statutory rate | 21% | 21% | 21% | 21% | |
Gross unrecognized income tax benefits | $ 4.6 | $ 4.6 | $ 4.5 | ||
Income tax penalties and interest accrued | $ 0.3 | $ 0.3 | $ 0.2 |
Balance Sheet Components - Cash
Balance Sheet Components - Cash and Cash Equivalents - Narrative (Details) - USD ($) $ in Millions | Oct. 28, 2023 | Apr. 29, 2023 |
Cash And Cash Equivalents [Line Items] | ||
Cash and cash equivalents | $ 122.5 | $ 157 |
Money Market Accounts | ||
Cash And Cash Equivalents [Line Items] | ||
Cash and cash equivalents | $ 0.2 | $ 1.3 |
Balance Sheet Components - Acco
Balance Sheet Components - Accounts Receivable and Allowance for Doubtful Accounts - Narrative (Details) - USD ($) $ in Millions | Oct. 28, 2023 | Apr. 29, 2023 |
Inventory, Net, Items Net of Reserve Alternative [Abstract] | ||
Allowance for doubtful accounts receivable | $ 1.5 | $ 1.3 |
Balance Sheet Components - Summ
Balance Sheet Components - Summary of Inventories (Details) - USD ($) $ in Millions | Oct. 28, 2023 | Apr. 29, 2023 |
Inventory, Net, Items Net of Reserve Alternative [Abstract] | ||
Finished products | $ 47.3 | $ 36.6 |
Work in process | 17.7 | 14.4 |
Raw materials | 118.9 | 108.7 |
Total inventories | $ 183.9 | $ 159.7 |
Balance Sheet Components - Prop
Balance Sheet Components - Property, Plant and Equipment - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | Apr. 29, 2023 | |
Property Plant And Equipment [Line Items] | |||||
Depreciation | $ 8.2 | $ 7.5 | $ 16.5 | $ 15.1 | |
Capital expenditures recorded in accounts payable | $ 5.6 | $ 4.5 | |||
Minimum | Buildings and Building Improvements | |||||
Property Plant And Equipment [Line Items] | |||||
Property, plant and equipment, useful life | 5 years | 5 years | |||
Minimum | Machinery and Equipment | |||||
Property Plant And Equipment [Line Items] | |||||
Property, plant and equipment, useful life | 3 years | 3 years | |||
Maximum | Buildings and Building Improvements | |||||
Property Plant And Equipment [Line Items] | |||||
Property, plant and equipment, useful life | 40 years | 40 years | |||
Maximum | Machinery and Equipment | |||||
Property Plant And Equipment [Line Items] | |||||
Property, plant and equipment, useful life | 15 years | 15 years |
Balance Sheet Components - Pr_2
Balance Sheet Components - Property, Plant and Equipment (Details) - USD ($) $ in Millions | Oct. 28, 2023 | Apr. 29, 2023 |
Property Plant And Equipment [Line Items] | ||
Total property, plant and equipment, gross | $ 561.9 | $ 556.7 |
Less: accumulated depreciation | (337.3) | (336.4) |
Property, plant and equipment, net | 224.6 | 220.3 |
Land | ||
Property Plant And Equipment [Line Items] | ||
Total property, plant and equipment, gross | 3 | 3 |
Buildings and Building Improvements | ||
Property Plant And Equipment [Line Items] | ||
Total property, plant and equipment, gross | 99.5 | 98.8 |
Machinery and Equipment | ||
Property Plant And Equipment [Line Items] | ||
Total property, plant and equipment, gross | 411.4 | 414.3 |
Construction In Progress | ||
Property Plant And Equipment [Line Items] | ||
Total property, plant and equipment, gross | $ 48 | $ 40.6 |
Balance Sheet Components - Pre-
Balance Sheet Components - Pre-production Tooling Costs Related to Long-term Supply Arrangements - Narrative (Details) - USD ($) $ in Millions | Oct. 28, 2023 | Apr. 29, 2023 |
Preproduction Tooling Costs Relatedto Longterm Supply Arrangements [Abstract] | ||
Pre-production costs | $ 44.5 | $ 36.1 |
Preproduction costs related to long-term supply arrangements, asset for molds dies and tools owned | $ 15.6 | $ 12.2 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Schedule of Summary of the Changes in the Carrying Amount of Goodwill by Segment (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Oct. 28, 2023 | Oct. 28, 2023 | |
Goodwill [Line Items] | ||
Beginning balance | $ 301.9 | |
Acquisitions | 21.8 | |
Impairment | $ (56.5) | (56.5) |
Foreign currency translation | (2.9) | |
Ending balance | 220.7 | 220.7 |
Automotive | ||
Goodwill [Line Items] | ||
Beginning balance | 106.2 | |
Impairment | (56.5) | (56.5) |
Foreign currency translation | (0.3) | |
Ending balance | 49.4 | 49.4 |
Industrial | ||
Goodwill [Line Items] | ||
Beginning balance | 195.7 | |
Acquisitions | 21.8 | |
Impairment | 0 | 0 |
Foreign currency translation | (2.6) | |
Ending balance | $ 171.3 | $ 171.3 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Summary of Goodwill by Reporting Unit (Details) - USD ($) $ in Millions | Oct. 28, 2023 | Apr. 29, 2023 |
Goodwill [Line Items] | ||
Goodwill | $ 220.7 | $ 301.9 |
Grakon Industrial | ||
Goodwill [Line Items] | ||
Goodwill | 123.9 | 124.5 |
North American Automotive | ||
Goodwill [Line Items] | ||
Goodwill | 49.4 | 99.8 |
Nordic Lights | ||
Goodwill [Line Items] | ||
Goodwill | 45.8 | 69.6 |
European Automotive | ||
Goodwill [Line Items] | ||
Goodwill | 6.4 | |
Other | ||
Goodwill [Line Items] | ||
Goodwill | $ 1.6 | $ 1.6 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Oct. 28, 2023 | Oct. 28, 2023 | |
Goodwill [Line Items] | ||
Goodwill impairment | $ 56.5 | $ 56.5 |
North American Automotive | ||
Goodwill [Line Items] | ||
Goodwill impairment | 50.4 | 50.4 |
European Automotive | ||
Goodwill [Line Items] | ||
Goodwill impairment | $ 6.1 | $ 6.1 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Schedule of Other Intangible Assets, Net (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Oct. 28, 2023 | Apr. 29, 2023 | |
Finite-lived Intangible Assets [Roll Forward] | ||
Gross | $ 377.6 | $ 358.3 |
Accumulated Amortization | (114.7) | (103.4) |
Net/Total | 262.9 | 254.9 |
Other intangible assets, gross | 379.4 | 360.1 |
Other intangible assets, accumulated amortization | (114.7) | (103.4) |
Other intangible assets, net | 264.7 | 256.7 |
Unamortized Trade Name | ||
Finite-lived Intangible Assets [Roll Forward] | ||
Gross | 1.8 | 1.8 |
Net | 1.8 | 1.8 |
Customer Relationships and Agreements | ||
Finite-lived Intangible Assets [Roll Forward] | ||
Gross | 303.6 | 286.7 |
Accumulated Amortization | (76.1) | (68.2) |
Net/Total | $ 227.5 | $ 218.5 |
Weighted average remaining useful life (years) | 15 years 2 months 12 days | 14 years 9 months 18 days |
Trade Names, Patents and Technology Licenses | ||
Finite-lived Intangible Assets [Roll Forward] | ||
Gross | $ 74 | $ 71.6 |
Accumulated Amortization | (38.6) | (35.2) |
Net/Total | $ 35.4 | $ 36.4 |
Weighted average remaining useful life (years) | 7 years 1 month 6 days | 6 years |
Goodwill and Other Intangible_7
Goodwill and Other Intangible Assets - Schedule of Estimated Aggregate Amortization Expense of Intangible Assets (Details) - USD ($) $ in Millions | Oct. 28, 2023 | Apr. 29, 2023 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2024 | $ 11.8 | |
2025 | 23.1 | |
2026 | 22.2 | |
2027 | 21.6 | |
2028 | 19.3 | |
Thereafter | 164.9 | |
Net/Total | $ 262.9 | $ 254.9 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities - Narrative Information (Details) € in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Oct. 28, 2023 USD ($) | Oct. 29, 2022 USD ($) | Oct. 28, 2023 USD ($) | Oct. 29, 2022 USD ($) | Oct. 28, 2023 EUR (€) | Apr. 29, 2023 USD ($) | |
Derivatives, Fair Value [Line Items] | ||||||
Derivative, maturity date | Aug. 31, 2023 | |||||
Derivative, notional amount | $ 60 | $ 60 | € 54.8 | |||
Gains on derivative | 0.4 | $ 0.6 | 1.1 | $ 0.9 | ||
Transaction gain associated with net investment hedge reported in AOCI | 7.5 | 7.3 | ||||
Euro-denominated long-term borrowings under Credit Agreement as hedge | 290.6 | $ 290.6 | ||||
Interest Rate Swap | ||||||
Derivatives, Fair Value [Line Items] | ||||||
Derivative, maturity date | Oct. 31, 2027 | |||||
Derivative, notional amount | 145.5 | $ 145.5 | € 132 | |||
Interest Rate Swap Two | ||||||
Derivatives, Fair Value [Line Items] | ||||||
Derivative, maturity date | Aug. 31, 2023 | |||||
Derivative, notional amount | 100 | $ 100 | ||||
Foreign Exchange Forward | ||||||
Derivatives, Fair Value [Line Items] | ||||||
Derivative, notional amount | 71.9 | 71.9 | $ 59.9 | |||
Gain (loss) on foreign currency derivatives recorded in earnings, net | $ (0.8) | $ (2.4) | (2.7) | $ (2.8) | ||
Cross-Currency Swap | ||||||
Derivatives, Fair Value [Line Items] | ||||||
Gains on derivative | $ 0.6 |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activities - Schedule of Fair Value of Derivative Instruments Classified as Level 2 Within Fair Value Recorded in the Balance Sheet (Details) - Level 2 - USD ($) $ in Millions | Oct. 28, 2023 | Apr. 29, 2023 |
Derivatives Designated as Hedging Instruments | Net Investment Hedges | Other Accrued Liabilities | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of derivative instruments assets (liabilities) net | $ (0.5) | |
Derivatives Designated as Hedging Instruments | Interest Rate Swap | Prepaid Expenses and Other Current Assets | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of derivative instruments assets (liabilities) net | 1.6 | |
Derivatives Designated as Hedging Instruments | Interest Rate Swap | Other Long-term Liabilities | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of derivative instruments assets (liabilities) net | $ (1.1) | |
Derivatives Not Designated as Hedging Instruments | Foreign Exchange Forward | Other Accrued Liabilities | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of derivative instruments assets (liabilities) net | $ (0.1) | (0.1) |
Derivatives Not Designated as Hedging Instruments | Foreign Exchange Forward | Prepaid Expenses and Other Current Assets | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of derivative instruments assets (liabilities) net | $ 0.1 |
Derivative Instruments and He_5
Derivative Instruments and Hedging Activities - Schedule of Derivative Instruments Effect on Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gross amounts recorded in other comprehensive income (loss) Net | $ 0.7 | $ 2.1 | $ (1.5) | $ 4.1 |
Net Investment Hedges | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gross amounts recorded in other comprehensive income (loss) Net | 1.1 | 1.4 | 1.2 | 3.4 |
Interest Rate Swap | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gross amounts recorded in other comprehensive income (loss) Net | $ (0.4) | $ 0.7 | $ (2.7) | $ 0.7 |
Debt - Summary of Debt (Details
Debt - Summary of Debt (Details) - USD ($) $ in Millions | Oct. 28, 2023 | Apr. 29, 2023 |
Debt Instrument [Line Items] | ||
Unamortized debt issuance costs | $ (3) | $ (3.3) |
Total debt | 332 | 306.8 |
Less: current maturities | (3) | (3.2) |
Long-term debt | 329 | 303.6 |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Debt | 330.6 | 305.4 |
Other Debt | ||
Debt Instrument [Line Items] | ||
Debt | 4.4 | $ 4.7 |
Less: current maturities | $ (3) |
Debt - Revolving Credit Facilit
Debt - Revolving Credit Facility/Term Loan (Details) - Revolving Credit Facility € in Millions | Oct. 31, 2022 USD ($) | Oct. 28, 2023 USD ($) | Oct. 28, 2023 EUR (€) |
Nordic Lights | |||
Debt Instrument [Line Items] | |||
Euro-denominated outstanding borrowings under revolving credit facility | $ 290,600,000 | € 275 | |
Euro denominated borrowings | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 5.60% | 5.60% | |
US dollar borrowings | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 7.20% | 7.20% | |
Line of credit | Bank of America, N.A., and Wells Fargo Bank, N.A. [Member] | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 750,000,000 | ||
Line of credit | Bank of America, N.A. | |||
Debt Instrument [Line Items] | |||
Leverage ratio on pro forma basis | 3 | ||
Credit agreement termination date | Oct. 31, 2027 | ||
Line of credit | Bank of America, N.A. | Base Rate | Maximum | |||
Debt Instrument [Line Items] | |||
Adjusted interest rate | 1.25% | ||
Line of credit | Bank of America, N.A. | Base Rate | Minimum | |||
Debt Instrument [Line Items] | |||
Adjusted interest rate | 0.375% | ||
Line of credit | Bank of America, N.A. | SOFR Daily Floating Rate Loans | Maximum | |||
Debt Instrument [Line Items] | |||
Adjusted interest rate | 2.25% | ||
Line of credit | Bank of America, N.A. | SOFR Daily Floating Rate Loans | Minimum | |||
Debt Instrument [Line Items] | |||
Adjusted interest rate | 1.375% | ||
Line of credit | Bank of America, N.A. | Euro Interbank Offered Rate Plus | Maximum | |||
Debt Instrument [Line Items] | |||
Adjusted interest rate | 2.25% | ||
Line of credit | Bank of America, N.A. | Euro Interbank Offered Rate Plus | Minimum | |||
Debt Instrument [Line Items] | |||
Adjusted interest rate | 1.375% | ||
Term loan | Bank of America, N.A. | |||
Debt Instrument [Line Items] | |||
Increase in revolving commitments | $ 250,000,000 |
Debt - Other Debt (Details)
Debt - Other Debt (Details) $ in Millions | 6 Months Ended | |
Oct. 28, 2023 USD ($) Note | Apr. 29, 2023 USD ($) | |
Debt Instrument [Line Items] | ||
Debt, short-term | $ 3 | $ 3.2 |
Other Debt | ||
Debt Instrument [Line Items] | ||
Number of notes | Note | 3 | |
Weighted-average interest rate (as a percent) | 1.40% | |
Debt, short-term | $ 3 |
Shareholders' Equity - Share Re
Shareholders' Equity - Share Repurchase Program (Details) $ in Millions | Oct. 28, 2023 USD ($) shares |
Equity Class Of Treasury Stock [Line Items] | |
Shares purchased | shares | 3,113,154 |
Stock repurchase cost | $ 127.1 |
Remaining authorized repurchase amount | 72.9 |
Maximum | |
Equity Class Of Treasury Stock [Line Items] | |
Stock repurchase program, Authorized amount | $ 200 |
Shareholders' Equity - Summary
Shareholders' Equity - Summary of Stock Buyback Activity Under Share Buyback Program (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Share-Based Payment Arrangement [Abstract] | ||||
Shares purchased | 322,779 | 508,179 | 322,779 | 825,814 |
Average price per share | $ 24.03 | $ 38.69 | $ 24.03 | $ 38.21 |
Total cost | $ 7.8 | $ 19.7 | $ 7.8 | $ 31.6 |
Shareholders' Equity - Dividend
Shareholders' Equity - Dividends (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Cash dividends | $ 4.8 | $ 4.9 | $ 10.1 | $ 9.9 |
RSAs | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Cash dividends | $ 0.4 |
Shareholders' Equity - Summar_2
Shareholders' Equity - Summary of Changes in Accumulated Other Comprehensive Income (Loss), Net of Tax (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning balance | $ 931.4 | $ 911.4 | $ 941.8 | $ 913.8 |
Other comprehensive income (loss) | (16.9) | (17.8) | (21.8) | (26.7) |
Tax (expense) benefit | (2.9) | (0.3) | (2.1) | (0.8) |
Net other comprehensive income (loss) | (19.8) | (18.1) | (23.9) | (27.5) |
Ending balance | 844.9 | 898.8 | 844.9 | 898.8 |
Currency Translation Adjustments | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning balance | (22.3) | (41.4) | (19.8) | (30.5) |
Other comprehensive income (loss) | (17.6) | (19.9) | (20.3) | (30.8) |
Tax (expense) benefit | (2.6) | 0.2 | (2.4) | 0.2 |
Net other comprehensive income (loss) | (20.2) | (19.7) | (22.7) | (30.6) |
Ending balance | (42.5) | (61.1) | (42.5) | (61.1) |
Derivative Instruments | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning balance | (0.8) | 5.2 | 0.8 | 3.7 |
Other comprehensive income (loss) | 0.7 | 2.1 | (1.5) | 4.1 |
Tax (expense) benefit | (0.3) | (0.5) | 0.3 | (1) |
Net other comprehensive income (loss) | 0.4 | 1.6 | (1.2) | 3.1 |
Ending balance | (0.4) | 6.8 | (0.4) | 6.8 |
Accumulated Other Comprehensive Income (Loss) | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning balance | (23.1) | (36.2) | (19) | (26.8) |
Net other comprehensive income (loss) | (19.8) | (18.1) | (23.9) | (27.5) |
Ending balance | $ (42.9) | $ (54.3) | $ (42.9) | $ (54.3) |
Shareholders' Equity - General
Shareholders' Equity - General (Details) - shares | 6 Months Ended | |
Oct. 28, 2023 | Sep. 14, 2022 | |
2014 Incentive Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of shares common stock subject an option granted | 1 | |
Number of shares common stock subject an other than option granted | 2.28 | |
2022 Incentive Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of shares available for award (in shares) | 4,943,780 | 5,550,000 |
Stock-based compensation, description | the number of shares of the Company's common stock that will be available for all awards under the 2022 Plan is 5,550,000, less one share for every one share of common stock subject to an option or SAR award granted after April 30, 2022 under the 2014 Plan and 2.28 shares for every one share that was subject to an award other than an option or SAR granted after April 30, 2022 under the 2014 Plan. As of October 28, 2023, there were 4,943,780 shares available for award under the 2022 Plan. |
Shareholders' Equity - Narrativ
Shareholders' Equity - Narrative (Details) $ in Millions | 6 Months Ended |
Oct. 28, 2023 USD ($) shares | |
RSAs | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Shares granted in period (in shares) | 933,674 |
Additional stock issuable, shares | 466,837 |
Unrecognized stock-based compensation cost | $ | $ 26.8 |
RSUs | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Deferred RSU's | 577,055 |
Minimum | RSAs | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Vesting percentage | 0% |
Maximum | RSAs | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Vesting percentage | 100% |
Maximum | RSUs | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Vesting period | 5 years |
Shareholders' Equity - Summar_3
Shareholders' Equity - Summary of Restricted Stock Awards and Restricted Stock Units Activity (Details) | 6 Months Ended |
Oct. 28, 2023 $ / shares shares | |
RSAs | Management | 2020 EBITDA Maximum Performance | |
Shares | |
Non-vested Outstanding beginning balance (in shares) | shares | 933,674 |
Non-vested Outstanding ending balance (in shares) | shares | 933,674 |
Weighted average grant date fair value | |
Weighted average grant date fair value - beginning balance (in dollars per share) | $ / shares | $ 28.73 |
Weighted average grant date fair value - ending balance (in dollars per share) | $ / shares | $ 28.73 |
RSUs | |
Shares | |
Non-vested Outstanding beginning balance (in shares) | shares | 727,467 |
Awarded (in shares) | shares | 207,050 |
Vested (in shares) | shares | (866) |
Forfeited (in shares) | shares | (13,474) |
Non-vested Outstanding ending balance (in shares) | shares | 920,177 |
Weighted average grant date fair value | |
Weighted average grant date fair value - beginning balance (in dollars per share) | $ / shares | $ 30.6 |
Weighted average value, awarded (in dollars per share) | $ / shares | 22.83 |
Weighted average value, vested (in dollars per share) | $ / shares | 38.24 |
Weighted average value, forfeited (in dollars per share) | $ / shares | 41.62 |
Weighted average grant date fair value - ending balance (in dollars per share) | $ / shares | $ 28.68 |
Shareholders' Equity - Summar_4
Shareholders' Equity - Summary of Awards Granted to Non-employee Directors (Details) - Non-employee Directors | 6 Months Ended |
Oct. 28, 2023 $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Non-vested Outstanding beginning balance (in shares) | 45,750 |
Awarded (in shares) | 46,998 |
Issued (in shares) | (16,804) |
Non-vested Outstanding ending balance (in shares) | 75,944 |
Weighted average grant date fair value | |
Weighted average grant date fair value - beginning balance (in dollars per share) | $ / shares | $ 40.56 |
Weighted average grant date fair value, awarded (in dollars per share) | $ / shares | 33.22 |
Weighted average grant date fair value, issued (in dollars per share) | $ / shares | 33.32 |
Weighted average grant date fair value - ending balance (in dollars per share) | $ / shares | $ 37.62 |
Non-Employee Director Awards | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Awarded (in shares) | 16,804 |
Issued (in shares) | (16,804) |
Deferred Non-Employee Director Awards | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Non-vested Outstanding beginning balance (in shares) | 45,750 |
Awarded (in shares) | 30,194 |
Non-vested Outstanding ending balance (in shares) | 75,944 |
Shareholders' Equity - Summar_5
Shareholders' Equity - Summary of Combined Stock Option Activity and Related Information for Stock Options Granted (Details) - Share-based Payment Arrangement, Option - USD ($) $ / shares in Units, $ in Millions | 6 Months Ended | 12 Months Ended |
Oct. 28, 2023 | Apr. 29, 2023 | |
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding [Roll Forward] | ||
Outstanding - beginning balance (in shares) | 20,000 | |
Outstanding - ending balance (in shares) | 20,000 | 20,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | ||
Weighted average exercise price, Outstanding - beginning balance (in dollars per share) | $ 37.01 | |
Weighted average exercise price, Outstanding - ending balance (in dollars per share) | $ 37.01 | $ 37.01 |
Weighted-average life of outstanding options | 8 months 12 days | 1 year 2 months 12 days |
Intrinsic value of outstanding options | $ 0 | $ 0.1 |
Shareholders' Equity - Stock-ba
Shareholders' Equity - Stock-based Compensation Expense (Details) - 2014 Incentive Plan - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 1.3 | $ 2.7 | $ 3.9 | $ 6.7 |
RSUs | Management | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 1.3 | $ 2.7 | 2.3 | 5.1 |
RSUs | Non-employee Directors | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | 0.6 | 0.6 | ||
RSUs | Deferred Non-Employee Director Awards | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 1 | $ 1 |
(Loss) Income per Share - Sched
(Loss) Income per Share - Schedule of Computation of Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Earnings Per Share [Abstract] | ||||
Net Income (Loss) | $ (55.3) | $ 27.6 | $ (54.4) | $ 49.1 |
Weighted Average Number of Shares Outstanding Reconciliation [Abstract] | ||||
Denominator for basic income per share - weighted average shares outstanding and vested/unissued restricted stock units | 35,671,677 | 36,126,132 | 35,679,776 | 36,346,054 |
Dilutive potential common shares | 715,699 | 682,762 | ||
Denominator for diluted income per share | 35,671,677 | 36,841,831 | 35,679,776 | 37,028,816 |
(Loss) income per share attributable to Methode: | ||||
Basic | $ (1.55) | $ 0.76 | $ (1.52) | $ 1.35 |
(Loss) income per share attributable to Methode: | ||||
Diluted | $ (1.55) | $ 0.75 | $ (1.52) | $ 1.33 |
Number of anti-dilutive potentially issuable shares excluded from diluted common shares outstanding | 1,543,183 | 940,510 | 1,536,206 | 934,522 |
(Loss) Income per Share - Narra
(Loss) Income per Share - Narrative (Details) - shares | 3 Months Ended | 6 Months Ended |
Oct. 28, 2023 | Oct. 28, 2023 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Dilutive effect of potential common shares | 584,000 | 589,000 |
Segment Information - Narrative
Segment Information - Narrative (Details) | 6 Months Ended |
Oct. 28, 2023 Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 4 |
Segment Information - Schedule
Segment Information - Schedule of Segment Reporting Information, by Segment (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | Apr. 29, 2023 | |
Segment Reporting Information [Line Items] | |||||
Net sales | $ 288 | $ 315.9 | $ 577.7 | $ 598.3 | |
Income (loss) from operations | (51.3) | 32.8 | (47.5) | 54.6 | |
Interest expense, net | 4.4 | 0.5 | 7.2 | 0.5 | |
Other expense (income), net | (0.2) | (1.1) | (0.2) | (5.2) | |
Pre-tax (loss) income | (55.5) | 33.4 | (54.5) | 59.3 | |
Goodwill impairment | 56.5 | 56.5 | |||
Identifiable assets | 1,484.9 | 1,484.9 | $ 1,579.1 | ||
Automotive | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 154.3 | 196.9 | 312.6 | 373.5 | |
Income (loss) from operations | (61.5) | 23.4 | (64.3) | 38.1 | |
Goodwill impairment | 56.5 | 56.5 | |||
Identifiable assets | 643.3 | 643.3 | 700.2 | ||
Industrial | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 120.4 | 103.8 | 235.8 | 195.9 | |
Income (loss) from operations | 25.7 | 25 | 49.9 | 47.4 | |
Goodwill impairment | 0 | 0 | |||
Identifiable assets | 636.8 | 636.8 | 672.3 | ||
Interface | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 11.7 | 14.1 | 26.9 | 27.1 | |
Income (loss) from operations | 1 | 1.6 | 3.9 | 3.2 | |
Goodwill impairment | 0 | 0 | |||
Identifiable assets | 117.5 | 117.5 | 127.2 | ||
Medical | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 1.6 | 1.1 | 2.4 | 1.8 | |
Income (loss) from operations | (0.7) | (1.4) | (2.9) | (2.9) | |
Goodwill impairment | 0 | 0 | |||
Identifiable assets | 0.8 | 0.8 | 6.2 | ||
Eliminations/Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 0 | 0 | 0 | 0 | |
Income (loss) from operations | (15.8) | (15.8) | (34.1) | (31.2) | |
Goodwill impairment | 0 | 0 | |||
Identifiable assets | 86.5 | 86.5 | $ 73.2 | ||
Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 288 | 315.9 | 577.7 | 598.3 | |
Operating Segments | Automotive | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 158 | 198.3 | 319.1 | 375.6 | |
Operating Segments | Industrial | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 128 | 107.8 | 250.6 | 201.5 | |
Operating Segments | Interface | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 11.7 | 14.1 | 27 | 27.1 | |
Operating Segments | Medical | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 1.6 | 1.1 | 2.4 | 1.8 | |
Operating Segments | Eliminations/Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | (11.3) | (5.4) | (21.4) | (7.7) | |
Transfers between Segments | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 0 | 0 | 0 | 0 | |
Transfers between Segments | Automotive | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | (3.7) | (1.4) | (6.5) | (2.1) | |
Transfers between Segments | Industrial | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | (7.6) | (4) | (14.8) | (5.6) | |
Transfers between Segments | Interface | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 0 | 0 | (0.1) | 0 | |
Transfers between Segments | Medical | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 0 | 0 | 0 | 0 | |
Transfers between Segments | Eliminations/Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | $ 11.3 | $ 5.4 | $ 21.4 | $ 7.7 |
Contingencies - Narrative (Deta
Contingencies - Narrative (Details) $ in Millions | Mar. 02, 2020 USD ($) |
Compensatory Damages | |
Loss Contingencies [Line Items] | |
Gain Contingency, Unrecorded Amount | $ 102 |
Punitive Damages | |
Loss Contingencies [Line Items] | |
Gain Contingency, Unrecorded Amount | $ 11 |
Restructuring - Narrative (Deta
Restructuring - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Oct. 28, 2023 | Oct. 28, 2023 | Oct. 29, 2022 | |
Restructuring Cost And Reserve [Line Items] | |||
Asset impairment charges | $ 0.6 | $ 0.4 | |
Restructuring liability | $ 0.1 | 0.1 | |
Automotive | |||
Restructuring Cost And Reserve [Line Items] | |||
Severance costs | 0.2 | 0.2 | |
Selling and Administrative Expenses | |||
Restructuring Cost And Reserve [Line Items] | |||
Severance costs | $ 0.4 | $ 0.5 |
Restructuring - Summary of Comp
Restructuring - Summary of Components of Restructuring Costs (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Oct. 28, 2023 | Oct. 29, 2022 | Oct. 28, 2023 | Oct. 29, 2022 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs | $ 0.6 | $ 0.5 | $ 1.3 | $ 0.6 |
Cost of Products Sold | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs | 0.2 | 0.1 | 0.8 | 0.1 |
Selling and Administrative Expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs | 0.4 | 0.4 | 0.5 | 0.5 |
Automotive | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs | 0.2 | 0.2 | ||
Industrial | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs | 0.4 | 0.5 | ||
Medical | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs | $ 0.4 | $ 1.1 | ||
Eliminations/Corporate | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs | $ 0.1 | $ 0.1 |