Document and Entity Information
Document and Entity Information Document - shares | 9 Months Ended | |
Sep. 30, 2015 | Oct. 31, 2015 | |
Entity Information [Line Items] | ||
Entity Registrant Name | NACCO INDUSTRIES INC | |
Entity Central Index Key | 789,933 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Shares Outstanding Class A | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 5,261,119 | |
Shares Outstanding Class B | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 1,571,927 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 |
ASSETS | |||
Cash and cash equivalents | $ 11,847 | $ 61,135 | $ 50,598 |
Accounts receivable, net | 118,097 | 123,466 | 97,639 |
Accounts receivable from affiliates | 2,793 | 57,421 | 44,339 |
Inventories, net | 234,214 | 190,382 | 220,607 |
Deferred income taxes | 23,024 | 18,566 | 11,486 |
Prepaid expenses and other | 21,318 | 14,743 | 25,774 |
Total current assets | 411,293 | 465,713 | 450,443 |
Property, plant and equipment, net | 151,767 | 159,644 | 252,039 |
Goodwill | 6,253 | 6,253 | 0 |
Other Intangibles, net | 57,650 | 60,821 | 57,017 |
Deferred income taxes | 15,984 | 15,806 | 1,175 |
Other non-current assets | 59,770 | 62,283 | 68,486 |
Total assets | 702,717 | 770,520 | 829,160 |
LIABILITIES AND EQUITY | |||
Accounts payable | 161,040 | 133,668 | 149,343 |
Revolving credit agreements of subsidiaries - not guaranteed by the parent company | 13,858 | 55,000 | 69,805 |
Current maturities of long-term debt of subsidiaries - not guaranteed by the parent company | 1,495 | 1,467 | 7,886 |
Accrued payroll | 34,336 | 23,567 | 19,136 |
Other current liabilities | 45,270 | 40,979 | 41,325 |
Total current liabilities | 255,999 | 254,681 | 287,495 |
Long-term debt of subsidiaries - not guaranteed by the parent company | 158,650 | 191,431 | 138,958 |
Mine closing reserves | 40,453 | 37,399 | 36,217 |
Pension and other postretirement obligations | 9,711 | 10,616 | 7,312 |
Deferred income taxes | 0 | 0 | 23,304 |
Other long-term liabilities | 53,160 | 64,919 | 66,632 |
Total liabilities | 517,973 | 559,046 | 559,918 |
Common stock: | |||
Retained earnings | 200,853 | 224,428 | 274,297 |
Accumulated other comprehensive loss | (22,958) | (20,189) | (12,450) |
Total stockholders' equity | 184,744 | 211,474 | 269,242 |
Total liabilities and equity | 702,717 | 770,520 | 829,160 |
Shares Outstanding Class A | |||
Common stock: | |||
Common stock | 5,277 | 5,662 | 5,821 |
Shares Outstanding Class B | |||
Common stock: | |||
Common stock | $ 1,572 | $ 1,573 | $ 1,574 |
Unaudited Condensed Consolidat3
Unaudited Condensed Consolidated Balance Sheets (Parenthetical) | Sep. 30, 2015$ / sharesshares | Dec. 31, 2014$ / sharesshares | Sep. 30, 2014$ / sharesshares |
Shares Outstanding Class A | |||
Common stock, par value | $ / shares | $ 1 | $ 1 | $ 1 |
Common stock, shares outstanding | 5,276,963 | 5,662,214 | 5,821,078 |
Shares Outstanding Class B | |||
Common stock, par value | $ / shares | $ 1 | $ 1 | $ 1 |
Common stock, convertible conversion ratio | 1 | 1 | 1 |
Common stock, shares outstanding | 1,572,027 | 1,573,292 | 1,573,804 |
Unaudited Condensed Consolidat4
Unaudited Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Statement [Abstract] | ||||
Revenues | $ 239,107 | $ 221,714 | $ 629,341 | $ 599,497 |
Cost of sales | 196,892 | 175,171 | 513,556 | 480,260 |
Gross profit | 42,215 | 46,543 | 115,785 | 119,237 |
Earnings of unconsolidated mines | 12,234 | 12,064 | 36,863 | 36,069 |
Operating expenses | ||||
Selling, general and administrative expenses | 47,551 | 46,373 | 139,186 | 145,792 |
Amortization of intangible assets | 1,138 | 911 | 3,173 | 2,667 |
Operating expenses | 48,689 | 47,284 | 142,359 | 148,459 |
Operating profit | 5,760 | 11,323 | 10,289 | 6,847 |
Other expense (income) | ||||
Interest expense | 1,597 | 2,046 | 5,383 | 5,450 |
Income from other unconsolidated affiliates | (264) | (191) | (1,736) | (159) |
Closed mine obligations | 244 | 316 | 1,071 | 940 |
Other, net, including interest income | 908 | 86 | 1,220 | (65) |
Other (income) expense | 2,485 | 2,257 | 5,938 | 6,166 |
Income before income tax provision (benefit) | 3,275 | 9,066 | 4,351 | 681 |
Income tax provision (benefit) | 134 | 1,367 | 458 | (1,870) |
Net income | $ 3,141 | $ 7,699 | $ 3,893 | $ 2,551 |
Earnings Per Share [Abstract] | ||||
Basic earnings per share (in dollars per share) | $ 0.45 | $ 1.02 | $ 0.55 | $ 0.33 |
Diluted earnings per share (in dollars per share) | 0.45 | 1.02 | 0.55 | 0.33 |
Dividends per share (in dollars per share) | $ 0.2625 | $ 0.2575 | $ 0.7825 | $ 0.7650 |
Basic weighted average shares outstanding | 6,924 | 7,515 | 7,051 | 7,688 |
Diluted weighted average shares outstanding | 6,935 | 7,533 | 7,065 | 7,702 |
Unaudited Condensed Consolidat5
Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 3,141 | $ 7,699 | $ 3,893 | $ 2,551 |
Foreign currency translation adjustment | (1,190) | (740) | (2,352) | (656) |
Deferred gain (loss) on available for sale securities | (229) | 33 | (205) | 270 |
Current period cash flow hedging activity, net of $304 and $674 tax benefit in the three and nine months ended September 30, 2015, respectively, and $351 tax expense and $457 tax benefit in the three and nine months ended September 30, 2014, respectively. | (558) | 590 | (1,216) | (860) |
Reclassification of hedging activities into earnings, net of $41 and $178 tax benefit in the three and nine months ended September 30, 2015, respectively, and $137 and $324 tax benefit in the three and nine months ended September 30, 2014, respectively. | 89 | 249 | 363 | 602 |
Reclassification of pension and postretirement adjustments into earnings, net of $97 and $300 tax benefit in the three and nine months ended September 30, 2015, respectively, and $75 and $235 tax benefit in the three and nine months ended September 30, 2014, respectively. | 216 | 180 | 641 | 453 |
Total other comprehensive income (loss) | (1,672) | 312 | (2,769) | (191) |
Comprehensive income | $ 1,469 | $ 8,011 | $ 1,124 | $ 2,360 |
Unaudited Condensed Consolidat6
Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Current period cash flow hedging activity, tax expense (benefit) | $ (304) | $ 351 | $ (674) | $ (457) |
Reclassification of hedging activities into earnings, tax benefit (expense) | (41) | (137) | (178) | (324) |
Reclassification of pension and postretirement adjustments into earnings, tax benefit (expense) | $ (97) | $ (75) | $ (300) | $ (235) |
Unaudited Condensed Consolidat7
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Operating activities | ||
Net income | $ 3,893 | $ 2,551 |
Adjustments to reconcile from net income to net cash provided by operating activities: | ||
Depreciation, depletion and amortization | 17,337 | 19,445 |
Amortization of deferred financing fees | 946 | 347 |
Deferred income taxes | (4,636) | 994 |
Other | (533) | 10,086 |
Working capital changes: | ||
Accounts receivable | 59,757 | 10,511 |
Inventories | (43,832) | (36,183) |
Other current assets | 2,056 | (1,075) |
Accounts payable | 29,056 | 16,884 |
Other current liabilities | 4,276 | (8,909) |
Income taxes receivable/payable | (8,506) | (12,433) |
Net cash provided by for operating activities | 59,814 | 2,218 |
Investing activities | ||
Expenditures for property, plant and equipment | (7,484) | (47,663) |
Other | 1,160 | 366 |
Net cash used for investing activities | (6,324) | (47,297) |
Financing activities | ||
Additions to long-term debt | 2,547 | 1,553 |
Reductions of long-term debt | (2,300) | (2,000) |
Net additions (reductions) to revolving credit agreements | (74,143) | 33,345 |
Cash dividends paid | (5,502) | (5,884) |
Purchase of treasury shares | (23,248) | (26,447) |
Other | (78) | (255) |
Net cash provided by (used for) financing activities | (102,724) | 312 |
Effect of exchange rate changes on cash | (54) | (25) |
Cash and cash equivalents | ||
Decrease for the period | (49,288) | (44,792) |
Balance at the beginning of the period | 61,135 | 95,390 |
Balance at the end of the period | $ 11,847 | $ 50,598 |
Unaudited Condensed Consolidat8
Unaudited Condensed Consolidated Statements of Changes in Equity - USD ($) $ in Thousands | Total | Total Stockholders' Equity | Common StockShares Outstanding Class A | Common StockShares Outstanding Class B | Capital in Excess of Par Value | Retained Earnings | Foreign Currency Translation Adjustment | Deferred Gain (Loss) on Available for Sale Securities | Deferred Gain (Loss) on Cash Flow Hedging | Pension and Postretirement Plan Adjustment |
Balance, beginning of period at Dec. 31, 2013 | $ 297,780 | $ 6,290 | $ 1,581 | $ 941 | $ 301,227 | $ (803) | $ 1,021 | $ 676 | $ (13,153) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock-based compensation | 1,433 | 26 | 1,407 | |||||||
Purchase of treasury shares | (26,447) | (502) | (2,348) | (23,597) | ||||||
Conversion of Class B to Class A shares | 7 | (7) | ||||||||
Net income | $ 2,551 | 2,551 | 2,551 | |||||||
Cash dividends on Class A and Class B common stock: $0.7825 per share | (5,884) | 0 | 0 | (5,884) | ||||||
Current period other comprehensive income (loss) | (1,246) | (656) | 270 | (860) | 0 | |||||
Reclassification adjustment to net income (loss) | 1,055 | 602 | 453 | |||||||
Balance, end of period at Sep. 30, 2014 | 269,242 | 5,821 | 1,574 | 0 | 274,297 | (1,459) | 1,291 | 418 | (12,700) | |
Balance, beginning of period at Dec. 31, 2014 | 211,474 | 5,662 | 1,573 | 0 | 224,428 | (2,699) | 1,463 | 56 | (19,009) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock-based compensation | 896 | 40 | 856 | |||||||
Purchase of treasury shares | (23,248) | (426) | (856) | (21,966) | ||||||
Conversion of Class B to Class A shares | 1 | (1) | ||||||||
Net income | $ 3,893 | 3,893 | 3,893 | |||||||
Cash dividends on Class A and Class B common stock: $0.7825 per share | (5,502) | (5,502) | ||||||||
Current period other comprehensive income (loss) | (3,773) | (2,352) | (205) | (1,216) | 0 | |||||
Reclassification adjustment to net income (loss) | 1,004 | 363 | 641 | |||||||
Balance, end of period at Sep. 30, 2015 | $ 184,744 | $ 5,277 | $ 1,572 | $ 0 | $ 200,853 | $ (5,051) | $ 1,258 | $ (797) | $ (18,368) |
Unaudited Condensed Consolidat9
Unaudited Condensed Consolidated Statements of Changes in Equity (Parenthetical) - $ / shares | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Stockholders' Equity [Abstract] | ||
Cash dividends on common stock | $ 0.7825 | $ 0.7650 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying Unaudited Condensed Consolidated Financial Statements include the accounts of NACCO Industries, Inc. (the “parent company” or “NACCO”) and its wholly owned subsidiaries (collectively, “NACCO Industries, Inc. and Subsidiaries” or the “Company”). Intercompany accounts and transactions are eliminated in consolidation. The Company's subsidiaries operate in the following principal industries: mining, small appliances and specialty retail. The Company manages its subsidiaries primarily by industry. The North American Coal Corporation and its affiliated companies (collectively, “NACoal”) mine and market steam and metallurgical coal for use in power generation and steel production and provide selected value-added mining services for other natural resources companies. Hamilton Beach Brands, Inc. (“HBB”) is a leading designer, marketer and distributor of small electric household and specialty housewares appliances, as well as commercial products for restaurants, bars and hotels. The Kitchen Collection, LLC (“KC”) is a national specialty retailer of kitchenware in outlet and traditional malls throughout the United States. These financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the financial position of the Company at September 30, 2015 and the results of its operations, comprehensive income (loss), cash flows and changes in equity for the nine months ended September 30, 2015 and 2014 have been included. These Unaudited Condensed Consolidated Financial Statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014 . The balance sheet at December 31, 2014 has been derived from the audited financial statements at that date but does not include all of the information or notes required by U.S. GAAP for complete financial statements. Operating results for the three and nine months ended September 30, 2015 are not necessarily indicative of the results that may be expected for the remainder of the year ending December 31, 2015 . The HBB and KC businesses are seasonal and a majority of revenues and operating profit typically occurs in the second half of the calendar year when sales of small electric household appliances to retailers and consumers increase significantly for the fall holiday selling season. For further information regarding seasonality of these businesses, refer to the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014 . |
Recently Issued Accounting Stan
Recently Issued Accounting Standards | 9 Months Ended |
Sep. 30, 2015 | |
New Accounting Pronouncement or Change in Accounting Principle, Current Period Disclosures [Abstract] | |
Recently Issued Accounting Standards | Recently Issued Accounting Standards Accounting Standards Not Yet Adopted: In May 2014, the FASB codified in ASC 606, "Revenue Recognition - Revenue from Contracts with Customers," which supersedes most current revenue recognition guidance, including industry-specific guidance, and requires an entity to recognize revenue in an amount that reflects the consideration to which the entity expects to be entitled in exchange for transferring goods or services to customers and provide additional disclosures. As amended, the effective date for public entities is annual reporting periods beginning after December 15, 2017 and interim periods therein. As such, the Company will be required to adopt the standard in the first quarter of fiscal year 2018. Early adoption is not permitted before the first quarter of fiscal year 2017. ASC 606 may be adopted either using a full retrospective approach, in which the standard is applied to all of the periods presented, or a modified retrospective approach. The Company is currently evaluating which transition method to use and how ASC 606 will affect the Company's financial position, results of operations, cash flows and related disclosures. In August 2014, the FASB issued ASU No. 2014-15, "Preparation of Financial Statements - Going Concern: Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern," to provide guidance about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. Specifically, the amendments (1) provide a definition of the term “substantial doubt,” (2) require an evaluation every reporting period, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that financial statements are issued. ASU 2014-15 is effective for fiscal years ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company does not expect the adoption of this guidance to have an effect on the Company's financial position, results of operations, cash flows or related disclosures. In April 2015, the FASB issued ASU No. 2015-03, "Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs," requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-03 is effective for fiscal years beginning after December 15, 2015, and interim periods within fiscal years beginning after December 15, 2016. Early application is permitted. In August 2015, the FASB issued ASU 2015-15, "Interest—Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements—Amendments to SEC Paragraphs Pursuant to Staff Announcement at June 18, 2015 EITF Meeting (SEC Update)." ASU 2015-15 amends Subtopic 835-30 to include that the SEC would not object to the deferral and presentation of debt issuance costs as an asset and subsequent amortization of debt issuance costs over the term of the line-of-credit arrangement, whether or not there are any outstanding borrowings on the line-of-credit arrangement. This guidance is effective for fiscal years (and interim reporting periods within fiscal years) beginning after December 15, 2015. The Company does not expect the adoption of this guidance to have a material effect on the Company's financial position, results of operations, cash flows or related disclosures. In July 2015, the FASB issued ASU No. 2015-11, "Inventory - Simplifying the Measurement of Inventory," requiring that inventory be measured at lower of cost or net realizable value. ASU 2015-11 is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. Early application is permitted. The Company does not expect the adoption of this guidance to have a material effect on the Company's financial position, results of operations, cash flows and related disclosures. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories are summarized as follows: SEPTEMBER 30 DECEMBER 31 SEPTEMBER 30 Coal - NACoal $ 20,565 $ 29,576 $ 25,749 Mining supplies - NACoal 21,083 19,774 18,641 Total inventories at weighted average cost 41,648 49,350 44,390 Sourced inventories - HBB 151,663 104,746 130,012 Retail inventories - KC 40,903 36,286 46,205 Total inventories at FIFO 192,566 141,032 176,217 $ 234,214 $ 190,382 $ 220,607 |
Stockholders Equity
Stockholders Equity | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Stockholders Equity | Stockholders' Equity Stock Repurchase Program: On November 12, 2013, the Company's Board of Directors approved a stock repurchase program (the "2013 Stock Repurchase Program") providing for the purchase of up to $60.0 million of the Company's Class A Common Stock outstanding through December 31, 2015. During the three months ended September 30, 2015 and September 30, 2014 , the Company repurchased 134,186 and 235,194 shares of Class A Common Stock for an aggregate purchase price of $7.2 million and $12.2 million under the 2013 Stock Repurchase Program at a weighted average purchase price of $53.95 and $51.86 per share, respectively. During the nine months ended September 30, 2015 and September 30, 2014 , the Company repurchased 426,909 and 501,531 shares of Class A Common Stock for an aggregate purchase price of $23.2 million and $26.4 million under the 2013 Stock Repurchase Program at a weighted average purchase price of $54.46 and $52.73 per share. As of October 6, 2015, the Company completed the 2013 Stock Repurchase Program. See Note 13 for further information on the completion of the 2013 Stock Repurchase Program. Amounts Reclassified out of Accumulated Other Comprehensive Income (Loss): The following table summarizes the amounts reclassified out of Accumulated other comprehensive income (loss) ("AOCI") and recognized in the Unaudited Condensed Consolidated Statements of Operations: Amount Reclassified from AOCI THREE MONTHS ENDED NINE MONTHS ENDED September 30 September 30 Details about AOCI Components 2015 2014 2015 2014 Location of (gain) loss reclassified from AOCI into income (loss) (Gain) loss on cash flow hedging Foreign exchange contracts $ (240 ) $ 8 $ (560 ) $ (194 ) Cost of sales Interest rate contracts 370 378 1,101 1,120 Interest expense 130 386 541 926 Total before income tax benefit (41 ) (137 ) (178 ) (324 ) Income tax benefit $ 89 $ 249 $ 363 $ 602 Net of tax Pension and postretirement plan Actuarial loss $ 326 $ 273 $ 983 $ 742 (a) Prior-service credit (13 ) (18 ) (42 ) (54 ) (a) 313 255 941 688 Total before income tax benefit (97 ) (75 ) (300 ) (235 ) Income tax benefit $ 216 $ 180 $ 641 $ 453 Net of tax Total reclassifications for the period $ 305 $ 429 $ 1,004 $ 1,055 Net of tax (a) These AOCI components are included in the computation of pension and postretirement health care (income) expense. See Note 10 for further discussion. |
Fair Value Disclosure
Fair Value Disclosure | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosure | Fair Value Disclosure Recurring Fair Value Measurements : The following table presents the Company's assets and liabilities accounted for at fair value on a recurring basis: Fair Value Measurements at Reporting Date Using Quoted Prices in Significant Active Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs Description Date (Level 1) (Level 2) (Level 3) September 30, 2015 Assets: Available for sale securities $ 6,905 $ 6,905 $ — $ — Foreign currency exchange contracts 364 — 364 — $ 7,269 $ 6,905 $ 364 $ — Liabilities: Interest rate swap agreements $ 1,804 $ — $ 1,804 $ — $ 1,804 $ — $ 1,804 $ — December 31, 2014 Assets: Available for sale securities $ 7,220 $ 7,220 $ — $ — Interest rate swap agreements 181 — 181 — Foreign currency exchange contracts 292 — 292 — $ 7,693 $ 7,220 $ 473 $ — Liabilities: Interest rate swap agreements $ 412 $ — $ 412 $ — $ 412 $ — $ 412 $ — September 30, 2014 Assets: Available for sale securities $ 6,955 $ 6,955 $ — $ — Interest rate swap agreements 538 — 538 Foreign currency exchange contracts 213 — 213 — $ 7,706 $ 6,955 $ 751 $ — Liabilities: Foreign currency exchange contracts $ 29 $ — $ 29 $ — Contingent consideration 1,606 — — 1,606 $ 1,635 $ — $ 29 $ 1,606 Bellaire Corporation (“Bellaire”) is a non-operating subsidiary of the Company with legacy liabilities relating to closed mining operations, primarily former Eastern U.S. underground coal mining operations. In connection with Bellaire's normal permit renewal with the Pennsylvania Department of Environmental Protection ("DEP"), Bellaire established a $5.0 million mine water treatment trust (the "Mine Water Treatment Trust") to provide a financial assurance mechanism in order to assure the long-term treatment of post-mining discharges. Bellaire's Mine Water Treatment Trust invests in available for sale securities that are reported at fair value based upon quoted market prices in active markets for identical assets; therefore, they are classified as Level 1 within the fair value hierarchy. The Company uses significant other observable inputs to value derivative instruments used to hedge foreign currency and interest rate risk; therefore, they are classified within Level 2 of the valuation hierarchy. The fair value for these contracts is determined based on exchange rates and interest rates, respectively. There were no transfers into or out of Levels 1, 2 or 3 during the three and nine months ended September 30, 2015 and 2014 . Other Fair Value Measurement Disclosures: The carrying amounts of cash and cash equivalents, accounts receivable and accounts payable approximate fair value due to the short-term nature of these instruments. Revolving credit agreements and long-term debt are recorded at carrying value in the Unaudited Condensed Consolidated Balance Sheets. The fair value of revolving credit agreements approximates their carrying value as the stated rates of the debt reflect recent market conditions. The fair values of revolving credit agreements and long-term debt, excluding capital leases, were determined using current rates offered for similar obligations taking into account subsidiary credit risk, which is Level 2 as defined in the fair value hierarchy. At September 30, 2015 , December 31, 2014 and September 30, 2014 , both the fair value and the book value of the Company's revolving credit agreements and long-term debt, excluding capital leases, was $163.5 million , $236.3 million and $204.7 million , respectively. |
Unconsolidated Subsidiaries
Unconsolidated Subsidiaries | 9 Months Ended |
Sep. 30, 2015 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Unconsolidated Subsidiaries | Unconsolidated Subsidiaries NACoal has two consolidated mining operations: Mississippi Lignite Mining Company (“MLMC”) and Centennial Natural Resources ("Centennial"), and provides dragline mining services for independently owned limerock quarries in Florida. NACoal also has the following wholly owned unconsolidated subsidiaries that each meet the definition of a variable interest entity and are accounted for using the equity method: The Coteau Properties Company ("Coteau") The Falkirk Mining Company ("Falkirk") The Sabine Mining Company ("Sabine") Demery Resources Company, LLC (“Demery”) Caddo Creek Resources Company, LLC (“Caddo Creek”) Coyote Creek Mining Company, LLC (“Coyote Creek”) Camino Real Fuels, LLC (“Camino Real”) Liberty Fuels Company, LLC (“Liberty”) NoDak Energy Services, LLC ("NoDak") The unconsolidated subsidiaries, with the exception of NoDak (collectively, the "Unconsolidated Mines"), were formed to develop, construct and operate surface coal mines under long-term contracts and are capitalized primarily with debt financing provided by or supported by their respective customers, and without recourse to NACCO and NACoal. Coteau, Falkirk, Sabine, Liberty and Coyote supply or will supply lignite coal for power generation. Demery and Caddo Creek supply lignite coal for the production of activated carbon. Camino Real supplies sub- bituminous coal for power generation. NoDak operates and maintains a coal processing facility. The contracts with the customers of the Unconsolidated Mines provide for reimbursement at a price based on actual costs plus an agreed pre-tax profit per ton of coal sold or actual costs plus a management fee. Although NACoal owns 100% of the equity and manages the daily operations of these entities, the Company has determined that the equity capital provided by NACoal is not sufficient to adequately finance the ongoing activities or absorb any expected losses without additional support from the customers. The customers have a controlling financial interest and have the power to direct the activities that most significantly affect the economic performance of the entities. As a result, NACoal is not the primary beneficiary and, therefore, does not consolidate these entities' financial positions or results of operations. The income taxes resulting from the operations of the Unconsolidated Mines are solely the responsibility of the Company. The pre-tax income from the Unconsolidated Mines is reported on the line “Earnings of unconsolidated mines” in the Unaudited Condensed Consolidated Statements of Operations, with related income taxes included in the provision for income taxes. The Company has included the pre-tax earnings of the Unconsolidated Mines above operating profit because they are an integral component of the Company's business and operating results. The pre-tax income from NoDak is reported on the line "(Income) loss from other unconsolidated affiliates" in the "Other expense (income)" section of the Unaudited Condensed Consolidated Statements of Operations, with the related income taxes included in the provision for income taxes. North American Coal Corporation India Private Limited ("NACC India") was formed to provide technical business advisory services to the third-party owner of a coal mine in India. During the third quarter of 2014, NACC India's customer defaulted on its contractual payment obligations and as a result of this default, NACC India terminated its contract with the customer and is pursuing contractual remedies. Prior to contract termination, NACC India met the definition of a variable interest entity of which NACoal was not the primary beneficiary and was accounted for using the equity method with net income or loss reported on the line "(Income) loss from other unconsolidated affiliates" in the "Other expense (income)" section of the Unaudited Condensed Consolidated Statements of Operations. Subsequent to contract termination, NACC India is no longer a variable interest entity and its financial position and results of operations are consolidated by NACoal as of the contract termination date. The investments in the Unconsolidated Mines and related tax positions totaled $25.9 million , $28.2 million and $28.9 million at September 30, 2015 , December 31, 2014 and September 30, 2014 , respectively. These amounts are included on the line “Other non-current assets” in the Unaudited Condensed Consolidated Balance Sheets. The Company's maximum risk of loss relating to these entities is limited to its invested capital, which was $3.9 million , $4.0 million and $3.8 million at September 30, 2015 , December 31, 2014 , and September 30, 2014 , respectively. Included in "Accounts receivable from affiliates" was $53.2 million and $42.2 million as of December 31, 2014 and September 30, 2014 , respectively, due to NACoal from Coyote Creek. Coyote Creek repaid NACoal the amount outstanding during the first quarter of 2015 as a result of Coyote Creek’s completion of third-party financing. NACoal is a party to certain guarantees related to Coyote Creek. Under certain circumstances of default or termination of Coyote Creek’s Lignite Sales Agreement (“LSA”), NACoal would be obligated for payment of a "make-whole" amount to Coyote Creek’s third party lenders. The “make-whole” amount is based on the excess, if any, of the discounted value of the remaining scheduled debt payments over the principal amount. In addition, in the event Coyote Creek’s LSA is terminated on or after January 1, 2024 by Coyote Creek’s customers, NACoal is obligated to purchase Coyote Creek’s dragline and rolling stock for the then net book value of those assets. To date, no payments have been required from NACoal since the inception of these guarantees. The Company believes that the likelihood of NACoal’s future performance under the guarantees is remote, and no amounts related to these guarantees have been recorded. Summarized financial information for the unconsolidated subsidiaries is as follows: THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30 SEPTEMBER 30 2015 2014 2015 2014 Revenues $ 154,545 $ 150,529 $ 457,719 $ 437,127 Gross profit $ 18,112 $ 19,504 $ 55,057 $ 56,123 Income before income taxes $ 12,571 $ 12,201 $ 38,221 $ 36,363 Net income $ 9,777 $ 9,372 $ 29,495 $ 28,046 |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Various legal and regulatory proceedings and claims have been or may be asserted against NACCO and certain subsidiaries relating to the conduct of their businesses, including product liability, patent infringement, asbestos-related claims, environmental and other claims. These proceedings and claims are incidental to the ordinary course of business of the Company. Management believes that it has meritorious defenses and will vigorously defend the Company in these actions. The Company's policy is to expense legal fees as services are rendered and to accrue for liabilities when losses are probable and reasonably estimable. Although the ultimate disposition of these proceedings is not presently determinable, management believes, after consultation with its legal counsel, that the likelihood is remote that material losses will be incurred in excess of accruals already recognized. HBB is investigating or remediating historical environmental contamination at some current and former sites operated by HBB or by businesses it acquired. Based on the current stage of the investigation or remediation at each known site, HBB estimates the total investigation and remediation costs and the period of assessment and remediation activity required for each site. The estimate of future investigation and remediation costs is primarily based on variables associated with site clean-up, including, but not limited to, physical characteristics of the site, the nature and extent of the contamination and applicable regulatory programs and remediation standards. No assessment can fully characterize all subsurface conditions at a site. There is no assurance that additional assessment and remediation efforts will not result in adjustments to estimated remediation costs or the time frame for remediation at these sites. HBB's estimates of investigation and remediation costs may change if it discovers contamination at additional sites or additional contamination at known sites, if the effectiveness of its current remediation efforts change, if applicable federal or state regulations change or if HBB's estimate of the time required to remediate the sites changes. HBB's revised estimates may differ materially from original estimates. At September 30, 2015 , December 31, 2014 and September 30, 2014 , HBB had accrued undiscounted obligations of $8.5 million , $9.7 million and $10.0 million , respectively, for environmental investigation and remediation activities. In addition, HBB estimates that it is reasonably possible that it may incur additional expenses in the range of zero to $4.7 million related to the environmental investigation and remediation at these sites. During the nine months ended September 30, 2014 , HBB recorded a $3.3 million charge to increase the liability for environmental investigation and remediation activities at the Picton, Ontario facility as a result of an environmental study performed in the second quarter of 2014. |
Product Warranties
Product Warranties | 9 Months Ended |
Sep. 30, 2015 | |
Product Warranties Disclosures [Abstract] | |
Product Warranties | Product Warranties HBB provides a standard warranty to consumers for all of its products. The specific terms and conditions of those warranties vary depending upon the product brand. In general, if a product is returned under warranty, a refund is provided to the consumer by HBB's customer, the retailer. Generally, the retailer returns those products to HBB for a credit. The Company estimates the costs which may be incurred under its standard warranty programs and records a liability for such costs at the time product revenue is recognized. The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. Factors that affect the Company's warranty liability include the number of units sold, historical and anticipated rates of warranty claims and the cost per claim. Changes in the Company's current and long-term recorded warranty liability are as follows: 2015 Balance at January 1 $ 5,856 Warranties issued 6,471 Settlements made (7,042 ) Balance at September 30 $ 5,285 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income Taxes The income tax provision includes U.S. federal, state and local, and foreign income taxes and is based on the application of a forecasted annual income tax rate applied to the current quarter's year-to-date pre-tax income or loss. In determining the estimated annual effective income tax rate, the Company analyzes various factors, including projections of the Company's annual earnings, taxing jurisdictions in which the earnings will be generated, the impact of state and local income taxes, the Company's ability to use tax credits and net operating loss carryforwards, and available tax planning alternatives. Discrete items, including the effect of changes in tax laws, tax rates and certain circumstances with respect to valuation allowances or other unusual or non-recurring tax adjustments are reflected in the period in which they occur as an addition to, or reduction from, the income tax provision, rather than included in the estimated effective annual income tax rate. The Company's effective income tax rate is affected by the benefit of percentage depletion. The effective income tax rates for the three months ended September 30, 2015 and September 30, 2014 were 4.1% and 15.1% , respectively. The effective income tax rate in the three months ended September 30, 2015 was lower due to discrete tax benefits and a shift in the mix of taxable income and/or loss toward entities with lower effective income tax rates. The effective income tax rate for the nine months ended September 30, 2015 was 10.5% . The effective income tax for the nine months ended September 30, 2014 was not meaningful as the $1.9 million income tax benefit was not directly correlated to the $0.7 million pre-tax income. The rate was impacted by net favorable discrete tax items totaling $2.0 million in the nine months ended September 30, 2014 primarily from the conclusion of the 2011 and 2012 U.S. federal tax return examinations. |
Retirement Benefit Plans
Retirement Benefit Plans | 9 Months Ended |
Sep. 30, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
Retirement Benefit Plans | Retirement Benefit Plans The Company maintains various defined benefit pension plans that provide benefits based on years of service and average compensation during certain periods. The Company's policy is to make contributions to fund these plans within the range allowed by applicable regulations. Plan assets consist primarily of publicly traded stocks and government and corporate bonds. Pension benefits were frozen for all employees effective as of the close of business on December 31, 2013. All eligible employees of the Company, including employees whose pension benefits are frozen, receive retirement benefits under defined contribution retirement plans. The Company also maintains postretirement health care plans which provide benefits to eligible retired employees. All health care plans of the Company have a cap on the Company's share of the costs. These plans have no assets. Under the Company's current policy, plan benefits are funded at the time they are due to participants. The components of pension and postretirement health care expense (income) are set forth below: THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30 SEPTEMBER 30 2015 2014 2015 2014 U.S. Pension and Postretirement Health Care Service cost $ 17 $ 18 $ 52 $ 53 Interest cost 675 691 2,065 2,180 Expected return on plan assets (1,205 ) (1,143 ) (3,687 ) (3,551 ) Amortization of actuarial loss 274 256 859 690 Amortization of prior service credit (13 ) (18 ) (42 ) (54 ) Total $ (252 ) $ (196 ) $ (753 ) $ (682 ) Non-U.S. Pension Interest cost $ 37 $ 50 $ 116 $ 149 Expected return on plan assets (67 ) (75 ) (208 ) (224 ) Amortization of actuarial loss 11 17 34 52 Total $ (19 ) $ (8 ) $ (58 ) $ (23 ) |
Business Segments
Business Segments | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Business Segments | Business Segments NACCO is a holding company with the following principal subsidiaries: NACoal, HBB and KC. See Note 1 for a discussion of the Company's industries and product lines. NACCO's non-operating segment, NACCO and Other, includes the accounts of the parent company and Bellaire Corporation ("Bellaire"), a non-operating subsidiary of the Company. Financial information for each of NACCO's reportable segments is presented in the following table. The line “Eliminations” in the Revenues section eliminates revenues from HBB sales to KC. The amounts of these revenues are based on current market prices of similar third-party transactions. No other sales transactions occur among reportable segments. THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30 SEPTEMBER 30 2015 2014 2015 2014 Revenues NACoal $ 42,704 $ 49,840 $ 121,965 $ 139,492 HBB 163,291 135,155 416,082 354,865 KC 34,708 37,551 94,457 107,231 Eliminations (1,596 ) (832 ) (3,163 ) (2,091 ) Total $ 239,107 $ 221,714 $ 629,341 $ 599,497 Operating profit (loss) NACoal (a) $ (4,010 ) $ 4,362 $ 3,579 $ 11,198 HBB 11,643 9,531 16,711 12,719 KC (843 ) (1,429 ) (6,860 ) (12,198 ) NACCO and Other (b) (1,142 ) (1,073 ) (3,267 ) (4,429 ) Eliminations 112 (68 ) 126 (443 ) Total $ 5,760 $ 11,323 $ 10,289 $ 6,847 Net income (loss) NACoal $ (5,345 ) $ 3,185 $ 3,401 $ 8,815 HBB 6,378 6,008 8,614 7,717 KC (550 ) (966 ) (4,290 ) (7,656 ) NACCO and Other (774 ) (906 ) (2,710 ) (3,776 ) Eliminations 3,432 378 (1,122 ) (2,549 ) Total $ 3,141 $ 7,699 $ 3,893 $ 2,551 (a) During the third quarter of 2015, the Company recorded a $0.5 million charge for severance as a result of the decision to cease mining operations at Centennial in Alabama by the end of 2015. Revisions were also made to Centennial's asset retirement obligations due to revised estimated cash flows and the timing of those cash flows, resulting in a $7.5 million charge during the third quarter of 2015 . Both of these charges are included in Cost of sales in NACoal. See Note 12 for further discussion on NACoal's asset retirement obligations. (b) During the second quarter of 2014, the Company recorded a $1.1 million charge included in Selling, general and administrative expenses in NACCO and Other to correct a prior period accounting error related to an increase in the estimated liability for certain frozen deferred compensation plans. Management, quantitatively and qualitatively, assessed the materiality of the error and the correction thereof and concluded that the effect of the previous accounting treatment was not material to prior periods, 2014 full-year results, or trend of earnings and determined no material misstatements existed in those prior periods and no restatement of those prior period financial statements was necessary. |
Asset Retirement Obligation
Asset Retirement Obligation | 9 Months Ended |
Sep. 30, 2015 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Asset Retirement Obligation | Asset Retirement Obligation NACoal's asset retirement obligations are principally for costs to dismantle certain mining equipment at the end of the life of the mine as well as for costs to close its surface mines and reclaim the land it has disturbed as a result of its normal mining activities. The Company determined the amounts of these obligations based on estimates adjusted for inflation, projected to the estimated closure dates, and then discounted using a credit-adjusted risk-free interest rate. The accretion of the liability is being recognized over the estimated life of each individual asset retirement obligation and is recorded in the line “Cost of sales” in the accompanying Unaudited Condensed Consolidated Statements of Operations. The associated asset is recorded in “Property, Plant and Equipment, net” in the accompanying Unaudited Condensed Consolidated Balance Sheets. On July 31, 2015, management recommended and The North American Coal Corporation’s Board of Directors approved cessation of coal production at Centennial by the end of 2015. The decision was made as a result of worsening conditions in the Alabama and global coal markets and the adverse effect regulatory changes have had on Centennial’s business. As a result of the decision to cease mining operations, revisions were made to Centennial's asset retirement obligations due to revised estimated cash flows and the timing of those cash flows, resulting in a $7.5 million charge in the third quarter of 2015 . A reconciliation of the beginning and ending aggregate carrying amount of the Company's asset retirement obligation is as follows: NACCO Consolidated Balance at January 1, 2015 $ 41,819 Liabilities settled during the period (6,182 ) Accretion expense 2,049 Revision of estimated cash flows 7,526 Balance at September 30, 2015 $ 45,212 |
Subsequent Events (Notes)
Subsequent Events (Notes) | 9 Months Ended |
Sep. 30, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events As of October 6, 2015, the Company completed the 2013 Stock Repurchase Program under which the Company purchased a total of approximately 1,122,900 shares of Class A common stock for an aggregate purchase price of $60.0 million . See Note 4 for further discussion on the 2013 Stock Repurchase Program. |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of estimates | These financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the financial position of the Company at September 30, 2015 and the results of its operations, comprehensive income (loss), cash flows and changes in equity for the nine months ended September 30, 2015 and 2014 have been included. These Unaudited Condensed Consolidated Financial Statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014 . The balance sheet at December 31, 2014 has been derived from the audited financial statements at that date but does not include all of the information or notes required by U.S. GAAP for complete financial statements. |
Standard product warranty | HBB provides a standard warranty to consumers for all of its products. The specific terms and conditions of those warranties vary depending upon the product brand. In general, if a product is returned under warranty, a refund is provided to the consumer by HBB's customer, the retailer. Generally, the retailer returns those products to HBB for a credit. The Company estimates the costs which may be incurred under its standard warranty programs and records a liability for such costs at the time product revenue is recognized. |
Income tax | The income tax provision includes U.S. federal, state and local, and foreign income taxes and is based on the application of a forecasted annual income tax rate applied to the current quarter's year-to-date pre-tax income or loss. In determining the estimated annual effective income tax rate, the Company analyzes various factors, including projections of the Company's annual earnings, taxing jurisdictions in which the earnings will be generated, the impact of state and local income taxes, the Company's ability to use tax credits and net operating loss carryforwards, and available tax planning alternatives. Discrete items, including the effect of changes in tax laws, tax rates and certain circumstances with respect to valuation allowances or other unusual or non-recurring tax adjustments are reflected in the period in which they occur as an addition to, or reduction from, the income tax provision, rather than included in the estimated effective annual income tax rate. |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories are summarized as follows: SEPTEMBER 30 DECEMBER 31 SEPTEMBER 30 Coal - NACoal $ 20,565 $ 29,576 $ 25,749 Mining supplies - NACoal 21,083 19,774 18,641 Total inventories at weighted average cost 41,648 49,350 44,390 Sourced inventories - HBB 151,663 104,746 130,012 Retail inventories - KC 40,903 36,286 46,205 Total inventories at FIFO 192,566 141,032 176,217 $ 234,214 $ 190,382 $ 220,607 |
Stockholders Equity (Tables)
Stockholders Equity (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Amounts Reclassified out of Accumulated Other Comprehensive Income | The following table summarizes the amounts reclassified out of Accumulated other comprehensive income (loss) ("AOCI") and recognized in the Unaudited Condensed Consolidated Statements of Operations: Amount Reclassified from AOCI THREE MONTHS ENDED NINE MONTHS ENDED September 30 September 30 Details about AOCI Components 2015 2014 2015 2014 Location of (gain) loss reclassified from AOCI into income (loss) (Gain) loss on cash flow hedging Foreign exchange contracts $ (240 ) $ 8 $ (560 ) $ (194 ) Cost of sales Interest rate contracts 370 378 1,101 1,120 Interest expense 130 386 541 926 Total before income tax benefit (41 ) (137 ) (178 ) (324 ) Income tax benefit $ 89 $ 249 $ 363 $ 602 Net of tax Pension and postretirement plan Actuarial loss $ 326 $ 273 $ 983 $ 742 (a) Prior-service credit (13 ) (18 ) (42 ) (54 ) (a) 313 255 941 688 Total before income tax benefit (97 ) (75 ) (300 ) (235 ) Income tax benefit $ 216 $ 180 $ 641 $ 453 Net of tax Total reclassifications for the period $ 305 $ 429 $ 1,004 $ 1,055 Net of tax (a) These AOCI components are included in the computation of pension and postretirement health care (income) expense. See Note 10 for further discussion. |
Fair Value Disclosure (Tables)
Fair Value Disclosure (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value, assets and liabilities measured on recurring basis | The following table presents the Company's assets and liabilities accounted for at fair value on a recurring basis: Fair Value Measurements at Reporting Date Using Quoted Prices in Significant Active Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs Description Date (Level 1) (Level 2) (Level 3) September 30, 2015 Assets: Available for sale securities $ 6,905 $ 6,905 $ — $ — Foreign currency exchange contracts 364 — 364 — $ 7,269 $ 6,905 $ 364 $ — Liabilities: Interest rate swap agreements $ 1,804 $ — $ 1,804 $ — $ 1,804 $ — $ 1,804 $ — December 31, 2014 Assets: Available for sale securities $ 7,220 $ 7,220 $ — $ — Interest rate swap agreements 181 — 181 — Foreign currency exchange contracts 292 — 292 — $ 7,693 $ 7,220 $ 473 $ — Liabilities: Interest rate swap agreements $ 412 $ — $ 412 $ — $ 412 $ — $ 412 $ — September 30, 2014 Assets: Available for sale securities $ 6,955 $ 6,955 $ — $ — Interest rate swap agreements 538 — 538 Foreign currency exchange contracts 213 — 213 — $ 7,706 $ 6,955 $ 751 $ — Liabilities: Foreign currency exchange contracts $ 29 $ — $ 29 $ — Contingent consideration 1,606 — — 1,606 $ 1,635 $ — $ 29 $ 1,606 |
Unconsolidated Subsidiaries (Ta
Unconsolidated Subsidiaries (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Variable Interest Entities | Summarized financial information for the unconsolidated subsidiaries is as follows: THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30 SEPTEMBER 30 2015 2014 2015 2014 Revenues $ 154,545 $ 150,529 $ 457,719 $ 437,127 Gross profit $ 18,112 $ 19,504 $ 55,057 $ 56,123 Income before income taxes $ 12,571 $ 12,201 $ 38,221 $ 36,363 Net income $ 9,777 $ 9,372 $ 29,495 $ 28,046 |
Product Warranties (Tables)
Product Warranties (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Product Warranties Disclosures [Abstract] | |
Current and Long-term Recorded Warranty Liability | Changes in the Company's current and long-term recorded warranty liability are as follows: 2015 Balance at January 1 $ 5,856 Warranties issued 6,471 Settlements made (7,042 ) Balance at September 30 $ 5,285 |
Retirement Benefit Plans (Table
Retirement Benefit Plans (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
Components of Pension and Postretirement Health Care Expense | The components of pension and postretirement health care expense (income) are set forth below: THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30 SEPTEMBER 30 2015 2014 2015 2014 U.S. Pension and Postretirement Health Care Service cost $ 17 $ 18 $ 52 $ 53 Interest cost 675 691 2,065 2,180 Expected return on plan assets (1,205 ) (1,143 ) (3,687 ) (3,551 ) Amortization of actuarial loss 274 256 859 690 Amortization of prior service credit (13 ) (18 ) (42 ) (54 ) Total $ (252 ) $ (196 ) $ (753 ) $ (682 ) Non-U.S. Pension Interest cost $ 37 $ 50 $ 116 $ 149 Expected return on plan assets (67 ) (75 ) (208 ) (224 ) Amortization of actuarial loss 11 17 34 52 Total $ (19 ) $ (8 ) $ (58 ) $ (23 ) |
Business Segments (Tables)
Business Segments (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Reporting Information | Financial information for each of NACCO's reportable segments is presented in the following table. The line “Eliminations” in the Revenues section eliminates revenues from HBB sales to KC. The amounts of these revenues are based on current market prices of similar third-party transactions. No other sales transactions occur among reportable segments. THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30 SEPTEMBER 30 2015 2014 2015 2014 Revenues NACoal $ 42,704 $ 49,840 $ 121,965 $ 139,492 HBB 163,291 135,155 416,082 354,865 KC 34,708 37,551 94,457 107,231 Eliminations (1,596 ) (832 ) (3,163 ) (2,091 ) Total $ 239,107 $ 221,714 $ 629,341 $ 599,497 Operating profit (loss) NACoal (a) $ (4,010 ) $ 4,362 $ 3,579 $ 11,198 HBB 11,643 9,531 16,711 12,719 KC (843 ) (1,429 ) (6,860 ) (12,198 ) NACCO and Other (b) (1,142 ) (1,073 ) (3,267 ) (4,429 ) Eliminations 112 (68 ) 126 (443 ) Total $ 5,760 $ 11,323 $ 10,289 $ 6,847 Net income (loss) NACoal $ (5,345 ) $ 3,185 $ 3,401 $ 8,815 HBB 6,378 6,008 8,614 7,717 KC (550 ) (966 ) (4,290 ) (7,656 ) NACCO and Other (774 ) (906 ) (2,710 ) (3,776 ) Eliminations 3,432 378 (1,122 ) (2,549 ) Total $ 3,141 $ 7,699 $ 3,893 $ 2,551 (a) During the third quarter of 2015, the Company recorded a $0.5 million charge for severance as a result of the decision to cease mining operations at Centennial in Alabama by the end of 2015. Revisions were also made to Centennial's asset retirement obligations due to revised estimated cash flows and the timing of those cash flows, resulting in a $7.5 million charge during the third quarter of 2015 . Both of these charges are included in Cost of sales in NACoal. See Note 12 for further discussion on NACoal's asset retirement obligations. (b) During the second quarter of 2014, the Company recorded a $1.1 million charge included in Selling, general and administrative expenses in NACCO and Other to correct a prior period accounting error related to an increase in the estimated liability for certain frozen deferred compensation plans. Management, quantitatively and qualitatively, assessed the materiality of the error and the correction thereof and concluded that the effect of the previous accounting treatment was not material to prior periods, 2014 full-year results, or trend of earnings and determined no material misstatements existed in those prior periods and no restatement of those prior period financial statements was necessary. |
(Asset Retirement Obligation) (
(Asset Retirement Obligation) (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Reconciliation of the Company's Asset Retirement Obligation | A reconciliation of the beginning and ending aggregate carrying amount of the Company's asset retirement obligation is as follows: NACCO Consolidated Balance at January 1, 2015 $ 41,819 Liabilities settled during the period (6,182 ) Accretion expense 2,049 Revision of estimated cash flows 7,526 Balance at September 30, 2015 $ 45,212 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 |
Inventory Disclosure [Abstract] | |||
Coal - NACoal | $ 20,565 | $ 29,576 | $ 25,749 |
Mining supplies - NACoal | 21,083 | 19,774 | 18,641 |
Total inventories at weighted average cost | 41,648 | 49,350 | 44,390 |
Sourced inventories - HBB | 151,663 | 104,746 | 130,012 |
Retail inventories - KC | 40,903 | 36,286 | 46,205 |
Total inventories at FIFO | 192,566 | 141,032 | 176,217 |
Inventories, net | $ 234,214 | $ 190,382 | $ 220,607 |
Stockholders Equity (Narrative)
Stockholders Equity (Narrative) (Details) - 2013 Stock Repurchase Program - Shares Outstanding Class A - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Nov. 12, 2013 | |
Equity, Class of Treasury Stock [Line Items] | |||||
Stock repurchase program, authorized amount | $ 60,000,000 | ||||
Treasury stock acquisition | $ 7,200,000 | $ 12,200,000 | $ 23,200,000 | $ 26,400,000 | |
Stock repurchase program, shares acquired during period | 134,186 | 235,194 | 426,909 | 501,531 | |
Stock repurchase program, shares acquired during period, weighted-average cost per share | $ 53.95 | $ 51.86 | $ 54.46 | $ 52.73 |
Stockholders Equity (Amounts Re
Stockholders Equity (Amounts Reclassified out of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||||
Cost of sales | $ 196,892 | $ 175,171 | $ 513,556 | $ 480,260 | |
Interest expense | 1,597 | 2,046 | 5,383 | 5,450 | |
Total before income tax benefit | (3,275) | (9,066) | (4,351) | (681) | |
Income tax benefit | (134) | (1,367) | (458) | 1,870 | |
Total reclassifications for the period | (3,141) | (7,699) | (3,893) | (2,551) | |
Reclassification out of Accumulated Other Comprehensive Income | |||||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||||
Total reclassifications for the period | 305 | 429 | 1,004 | 1,055 | |
Reclassification out of Accumulated Other Comprehensive Income | Loss (gain) on cash flow hedging | |||||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||||
Total before income tax benefit | 130 | 386 | 541 | 926 | |
Income tax benefit | 41 | 137 | 178 | 324 | |
Total reclassifications for the period | 89 | 249 | 363 | 602 | |
Reclassification out of Accumulated Other Comprehensive Income | Loss (gain) on cash flow hedging | Foreign exchange contracts | |||||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||||
Cost of sales | (240) | 8 | (560) | (194) | |
Reclassification out of Accumulated Other Comprehensive Income | Loss (gain) on cash flow hedging | Interest rate contracts | |||||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||||
Interest expense | 370 | 378 | 1,101 | 1,120 | |
Reclassification out of Accumulated Other Comprehensive Income | Pension and postretirement plan | |||||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||||
Actuarial loss | [1] | 326 | 273 | 983 | 742 |
Prior-service credit | [1] | (13) | (18) | (42) | (54) |
Total before income tax benefit | 313 | 255 | 941 | 688 | |
Income tax benefit | 97 | 75 | 300 | 235 | |
Total reclassifications for the period | $ 216 | $ 180 | $ 641 | $ 453 | |
[1] | These AOCI components are included in the computation of pension and postretirement health care (income) expense. See Note 10 for further discussion. |
Fair Value Disclosure (Narrativ
Fair Value Disclosure (Narrative) (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Long-term debt excluding capital leases fair value | $ 163,500 | $ 236,300 | $ 204,700 |
Long-term debt excluding capital leases book value | 163,500 | 236,300 | 204,700 |
Level 1 | Fair value measurements, recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Mine Water Treatment Trust | 6,905 | $ 7,220 | $ 6,955 |
Bellaire Corporation | Level 1 | Fair value measurements, recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Mine Water Treatment Trust | $ 5,000 |
Fair Value Disclosure (On a Rec
Fair Value Disclosure (On a Recurring Basis) (Details) - Fair value measurements, recurring - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 |
Level 1 | |||
Assets: | |||
Available for sale securities | $ 6,905 | $ 7,220 | $ 6,955 |
Interest rate swap agreements | 0 | 0 | |
Foreign currency exchange contracts | 0 | 0 | 0 |
Assets at fair value | 6,905 | 7,220 | 6,955 |
Liabilities: | |||
Interest rate swap agreements | 0 | 0 | |
Foreign currency exchange contracts | 0 | 0 | |
Contingent consideration | 0 | ||
Liabilities at fair value | 0 | 0 | 0 |
Level 2 | |||
Assets: | |||
Available for sale securities | 0 | 0 | 0 |
Interest rate swap agreements | 181 | 538 | |
Foreign currency exchange contracts | 364 | 292 | 213 |
Assets at fair value | 364 | 473 | 751 |
Liabilities: | |||
Interest rate swap agreements | $ 1,804 | 412 | |
Foreign currency exchange contracts | 29 | ||
Contingent consideration | 0 | ||
Liabilities at fair value | $ 1,804 | 412 | 29 |
Level 3 | |||
Assets: | |||
Available for sale securities | 0 | 0 | 0 |
Interest rate swap agreements | 0 | ||
Foreign currency exchange contracts | 0 | 0 | 0 |
Assets at fair value | 0 | 0 | 0 |
Liabilities: | |||
Interest rate swap agreements | 0 | 0 | |
Foreign currency exchange contracts | 0 | 0 | |
Contingent consideration | 1,606 | ||
Liabilities at fair value | 0 | 0 | 1,606 |
Total | |||
Assets: | |||
Available for sale securities | 6,905 | 7,220 | 6,955 |
Interest rate swap agreements | 181 | 538 | |
Foreign currency exchange contracts | 364 | 292 | 213 |
Assets at fair value | 7,269 | 7,693 | 7,706 |
Liabilities: | |||
Interest rate swap agreements | 1,804 | 412 | |
Foreign currency exchange contracts | 0 | 29 | |
Contingent consideration | 1,606 | ||
Liabilities at fair value | $ 1,804 | $ 412 | $ 1,635 |
Unconsolidated Subsidiaries (Na
Unconsolidated Subsidiaries (Narrative) (Details) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2015USD ($)Subsidiaries | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | |
Variable Interest Entity [Line Items] | |||
Number of wholly owned subsidiaries | Subsidiaries | 2 | ||
Variable interest entity, reporting entity involvement, maximum risk of loss | $ 3,900 | $ 4,000 | $ 3,800 |
Accounts receivable from affiliates | 2,793 | 57,421 | 44,339 |
Coyote Creek | |||
Variable Interest Entity [Line Items] | |||
Accounts receivable from affiliates | 53,200 | 42,200 | |
Other noncurrent assets | |||
Variable Interest Entity [Line Items] | |||
Investment in unconsolidated operations and related tax position | $ 25,900 | $ 28,200 | $ 28,900 |
Unconsolidated Subsidiaries Unc
Unconsolidated Subsidiaries Unconsolidated Subsidiaries (Schedule) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Variable Interest Entity [Line Items] | ||||
Revenues | $ 239,107 | $ 221,714 | $ 629,341 | $ 599,497 |
Gross profit | 42,215 | 46,543 | 115,785 | 119,237 |
Net income | 3,141 | 7,699 | 3,893 | 2,551 |
Variable interest entity, not primary beneficiary | ||||
Variable Interest Entity [Line Items] | ||||
Revenues | 154,545 | 150,529 | 457,719 | 437,127 |
Gross profit | 18,112 | 19,504 | 55,057 | 56,123 |
Income before income taxes | 12,571 | 12,201 | 38,221 | 36,363 |
Net income | $ 9,777 | $ 9,372 | $ 29,495 | $ 28,046 |
Contingencies (Narrative) (Deta
Contingencies (Narrative) (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2015 | Dec. 31, 2014 | |
Loss Contingencies [Line Items] | |||
Accrual for environmental investigation and remediation activities | $ 10,000,000 | $ 8,500,000 | $ 9,700,000 |
Loss contingency, range of possible loss, minimum | 0 | ||
Loss contingency, range of possible loss, maximum | $ 4,700,000 | ||
Picton, Ontario Facility | |||
Loss Contingencies [Line Items] | |||
Accrual for environmental loss contingencies, provision for new losses | $ 3,300,000 |
Product Warranties (Details)
Product Warranties (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward] | |
Balance at beginning of period | $ 5,856 |
Warranties issued | 6,471 |
Settlements made | (7,042) |
Balance at end of period | $ 5,285 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 4.10% | 15.10% | 10.50% | |
Income tax expense (benefit) | $ 134 | $ 1,367 | $ 458 | $ (1,870) |
Income (loss) from continuing operations before equity method investments, income taxes, extraordinary items, noncontrolling interest | $ 3,275 | $ 9,066 | $ 4,351 | 681 |
Discrete tax items | $ 2,000 |
Retirement Benefit Plans (Detai
Retirement Benefit Plans (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
U.S. Pension and Postretirement Health Care | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Service cost | $ 17 | $ 18 | $ 52 | $ 53 |
Interest cost | 675 | 691 | 2,065 | 2,180 |
Expected return on plan assets | (1,205) | (1,143) | (3,687) | (3,551) |
Amortization of actuarial loss | 274 | 256 | 859 | 690 |
Amortization of prior service credit | (13) | (18) | (42) | (54) |
Total | (252) | (196) | (753) | (682) |
Non-U.S. Pension | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Interest cost | 37 | 50 | 116 | 149 |
Expected return on plan assets | (67) | (75) | (208) | (224) |
Amortization of actuarial loss | 11 | 17 | 34 | 52 |
Total | $ (19) | $ (8) | $ (58) | $ (23) |
Business Segments (Details)
Business Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Segment Reporting Information [Line Items] | |||||
Revenues | $ 239,107 | $ 221,714 | $ 629,341 | $ 599,497 | |
Operating profit (loss) | 5,760 | 11,323 | 10,289 | 6,847 | |
Net income (loss) | 3,141 | 7,699 | 3,893 | 2,551 | |
Cost of sales | 196,892 | 175,171 | 513,556 | 480,260 | |
Revision of estimated cash flows | 7,500 | 7,526 | |||
Prior period accounting error | 47,551 | 46,373 | 139,186 | 145,792 | |
NACoal (a) | |||||
Segment Reporting Information [Line Items] | |||||
Cost of sales | 500 | ||||
Operating segments | NACoal (a) | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 42,704 | 49,840 | 121,965 | 139,492 | |
Operating profit (loss) | (4,010) | 4,362 | 3,579 | 11,198 | |
Net income (loss) | (5,345) | 3,185 | 3,401 | 8,815 | |
Operating segments | HBB | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 163,291 | 135,155 | 416,082 | 354,865 | |
Operating profit (loss) | 11,643 | 9,531 | 16,711 | 12,719 | |
Net income (loss) | 6,378 | 6,008 | 8,614 | 7,717 | |
Operating segments | KC | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 34,708 | 37,551 | 94,457 | 107,231 | |
Operating profit (loss) | (843) | (1,429) | (6,860) | (12,198) | |
Net income (loss) | (550) | (966) | (4,290) | (7,656) | |
Operating segments | NACCO and Other (b) | |||||
Segment Reporting Information [Line Items] | |||||
Operating profit (loss) | (1,142) | (1,073) | (3,267) | (4,429) | |
Net income (loss) | (774) | (906) | (2,710) | (3,776) | |
Eliminations | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | (1,596) | (832) | (3,163) | (2,091) | |
Operating profit (loss) | 112 | (68) | 126 | (443) | |
Net income (loss) | $ 3,432 | $ 378 | $ (1,122) | $ (2,549) | |
Correction of Prior Period Accounting | NACCO and Other (b) | |||||
Segment Reporting Information [Line Items] | |||||
Prior period accounting error | $ 1,100 |
Asset Retirement Obligation (De
Asset Retirement Obligation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2015 | Sep. 30, 2015 | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
Balance at beginning of period | $ 41,819 | |
Liabilities settled during the period | (6,182) | |
Accretion expense | 2,049 | |
Revision of estimated cash flows | $ 7,500 | 7,526 |
Balance at end of period | $ 45,212 | $ 45,212 |
Subsequent Events (Details)
Subsequent Events (Details) - Shares Outstanding Class A - Subsequent Event $ in Millions | Oct. 06, 2015USD ($)shares |
Subsequent Event [Line Items] | |
Stock repurchase program, shares acquired during period | 1,122,900 |
Treasury stock acquisition | $ | $ 60 |