Document and Entity Information
Document and Entity Information - shares shares in Millions | 6 Months Ended | |
Jun. 30, 2017 | Jul. 25, 2017 | |
Entity Registrant Name | ALBANY INTERNATIONAL CORP /DE/ | |
Entity Central Index Key | 819,793 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,017 | |
Common Class A [Member] | ||
Entity Common Stock, Shares Outstanding | 28.9 | |
Common Class B [Member] | ||
Entity Common Stock, Shares Outstanding | 3.2 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Statement [Abstract] | ||||
Net sales | $ 215,571 | $ 203,190 | $ 414,848 | $ 375,521 |
Cost of goods sold | 152,517 | 124,875 | 275,889 | 224,705 |
Gross profit | 63,054 | 78,315 | 138,959 | 150,816 |
Selling, general, and administrative expenses | 41,817 | 43,534 | 82,723 | 82,955 |
Technical and research expenses | 9,973 | 10,276 | 20,235 | 20,408 |
Restructuring expenses, net | 2,036 | 6,648 | 4,717 | 7,327 |
Operating income | 9,228 | 17,857 | 31,284 | 40,126 |
Interest expense, net | 4,285 | 3,691 | 8,613 | 5,929 |
Other expense/(income), net | 1,931 | (2,017) | 2,135 | (2,345) |
Income before income taxes | 3,012 | 16,183 | 20,536 | 36,542 |
Income tax expense | 1,779 | 6,082 | 8,329 | 13,125 |
Net income | 1,233 | 10,101 | 12,207 | 23,417 |
Net income/(loss) attributable to the noncontrolling interest | 116 | (266) | 251 | (451) |
Net income attributable to the Company | $ 1,117 | $ 10,367 | $ 11,956 | $ 23,868 |
Earnings per share attributable to Company shareholders - Basic | $ 0.03 | $ 0.32 | $ 0.37 | $ 0.74 |
Earnings per share attributable to Company shareholders - Diluted | $ 0.03 | $ 0.32 | $ 0.37 | $ 0.74 |
Shares of the Company used in computing earnings per share: | ||||
Basic | 32,166 | 32,093 | 32,147 | 32,067 |
Diluted | 32,200 | 32,131 | 32,182 | 32,106 |
Dividends declared per share, Class A and Class B | $ 0.17 | $ 0.17 | $ 0.34 | $ 0.34 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 1,233 | $ 10,101 | $ 12,207 | $ 23,417 |
Other comprehensive income/(loss), before tax: | ||||
Foreign currency translation adjustments | 17,436 | (10,126) | 27,374 | 2,615 |
Pension/postretirement plan remeasurement | (170) | |||
Amortization of pension liability adjustments: | ||||
Prior service credit | (1,113) | (1,112) | (2,226) | (2,225) |
Net actuarial loss | 1,353 | 1,296 | 2,700 | 2,574 |
Payments related to interest rate swaps included in earnings | 343 | 305 | 943 | 586 |
Derivative valuation adjustment | (1,414) | (4,581) | (998) | (7,433) |
Income taxes related to items of other comprehensive income/(loss): | ||||
Pension/postretirement plan remeasurement | 65 | |||
Amortization of pension liability adjustment | (72) | (56) | (142) | (105) |
Payments related to interest rate swaps included in earnings | (130) | (116) | (358) | (223) |
Derivative valuation adjustment | 537 | 1,741 | 379 | 2,825 |
Comprehensive income | 18,173 | (2,548) | 39,879 | 21,926 |
Comprehensive income/(loss) attributable to the noncontrolling interest | 124 | (264) | 264 | (452) |
Comprehensive income attributable to the Company | $ 18,049 | $ (2,284) | $ 39,615 | $ 22,378 |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 138,792 | $ 181,742 |
Accounts receivable, net | 193,065 | 171,193 |
Inventories | 151,534 | 133,906 |
Income taxes prepaid and receivable | 8,076 | 5,213 |
Prepaid expenses and other current assets | 11,980 | 9,251 |
Total current assets | 503,447 | 501,305 |
Property, plant and equipment, net | 446,814 | 422,564 |
Intangibles, net | 62,916 | 66,454 |
Goodwill | 164,328 | 160,375 |
Income taxes receivable and deferred | 77,323 | 68,865 |
Contract receivables | 21,581 | 14,045 |
Other assets | 31,859 | 29,825 |
Total assets | 1,308,268 | 1,263,433 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||
Notes and loans payable | 249 | 312 |
Accounts payable | 46,666 | 43,305 |
Accrued liabilities | 96,617 | 95,195 |
Current maturities of long-term debt | 51,732 | 51,666 |
Income taxes payable | 8,916 | 9,531 |
Total current liabilities | 204,180 | 200,009 |
Long-term debt | 444,030 | 432,918 |
Other noncurrent liabilities | 104,893 | 106,827 |
Deferred taxes and other liabilities | 13,074 | 12,389 |
Total liabilities | 766,177 | 752,143 |
SHAREHOLDERS' EQUITY | ||
Preferred stock, par value $5.00 per share; authorized 2,000,000 shares; none issued | ||
Additional paid in capital | 427,538 | 425,953 |
Retained earnings | 523,875 | 522,855 |
Accumulated items of other comprehensive income: | ||
Translation adjustments | (104,845) | (133,298) |
Pension and postretirement liability adjustments | (52,466) | (51,719) |
Derivative valuation adjustment | 794 | 828 |
Treasury stock (Class A), at cost 8,431,335 shares in 2017 and 8,443,444 shares in 2016 | (256,876) | (257,136) |
Total Company shareholders' equity | 538,060 | 507,523 |
Noncontrolling interest | 4,031 | 3,767 |
Total equity | 542,091 | 511,290 |
Total liabilities and shareholders' equity | 1,308,268 | 1,263,433 |
Common Class A [Member] | ||
SHAREHOLDERS' EQUITY | ||
Common Stock | 37 | 37 |
Common Class B [Member] | ||
SHAREHOLDERS' EQUITY | ||
Common Stock | $ 3 | $ 3 |
CONSOLIDATED BALANCE SHEETS (U5
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Jun. 30, 2017 | Dec. 31, 2016 |
Preferred Stock, par value per share | $ 5 | $ 5 |
Preferred Stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred Stock, shares issued | 0 | 0 |
Common Class A [Member] | ||
Common Stock, par value per share | $ 0.001 | $ 0.001 |
Common Stock, shares authorized | 100,000,000 | 100,000,000 |
Common Stock, shares issued | 37,372,553 | 37,319,266 |
Treasury stock, shares | 8,431,335 | 8,443,444 |
Common Class B [Member] | ||
Common Stock, par value per share | $ 0.001 | $ 0.001 |
Common Stock, shares authorized | 25,000,000 | 25,000,000 |
Common Stock, shares issued | 3,233,998 | 3,233,998 |
Common Stock, shares outstanding | 3,233,998 | 3,233,998 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOW (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
OPERATING ACTIVITIES | ||||
Net income | $ 1,233 | $ 10,101 | $ 12,207 | $ 23,417 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation | 15,201 | 15,142 | 29,845 | 28,266 |
Amortization | 2,632 | 2,817 | 5,281 | 4,513 |
Change in other noncurrent liabilities | (758) | (3,371) | (2,354) | (4,735) |
Change in deferred taxes and other liabilities | (6,745) | (1,457) | (7,357) | 1,072 |
Provision for write-off of property, plant and equipment | 534 | 484 | 830 | 1,076 |
Non-cash interest expense | 212 | 423 | ||
Compensation and benefits paid or payable in Class A Common Stock | 681 | 668 | 1,670 | 1,532 |
Changes in operating assets and liabilities that provided/(used) cash, net of impact of business acquisition: | ||||
Accounts receivable | (14,395) | (10,384) | (15,136) | (11,286) |
Inventories | 1,655 | (6,027) | (13,266) | (7,375) |
Prepaid expenses and other current assets | (651) | 2,561 | (2,568) | (2,821) |
Income taxes prepaid and receivable | (2,817) | 3,732 | (2,817) | 1,837 |
Accounts payable | (1,459) | 1,267 | 2,065 | 2,899 |
Accrued liabilities | 10,071 | 689 | (900) | (8,154) |
Income taxes payable | 1,978 | 2,903 | (508) | (933) |
Contract receivables | (3,621) | (7,768) | (7,536) | (7,768) |
Other, net | 4,638 | 7,291 | 3,938 | 2,490 |
Net cash provided by operating activities | 8,389 | 18,648 | 3,817 | 24,030 |
INVESTING ACTIVITIES | ||||
Purchase of business, net of cash acquired | (187,000) | (187,000) | ||
Purchases of property, plant and equipment | (21,360) | (20,112) | (46,405) | (28,105) |
Purchased software | (353) | (589) | (391) | (671) |
Proceeds from sale or involuntary conversion of assets | 1,736 | 1,736 | ||
Net cash used in investing activities | (21,713) | (205,965) | (46,796) | (214,040) |
FINANCING ACTIVITIES | ||||
Proceeds from borrowings | 16,114 | 207,134 | 32,259 | 219,530 |
Principal payments on debt | (540) | (426) | (21,142) | (22,824) |
Debt acquisition costs | (1,571) | (1,771) | ||
Swap termination payment | (5,175) | (5,175) | ||
Taxes paid in lieu of share issuance | (1,364) | (1,272) | ||
Proceeds from options exercised | 100 | 185 | 175 | 390 |
Dividends paid | (5,467) | (5,454) | (10,926) | (10,897) |
Net cash (used in)/provided by financing activities | 10,207 | 194,693 | (998) | 177,981 |
Effect of exchange rate changes on cash and cash equivalents | (1,424) | (966) | 1,027 | 2,941 |
(Decrease)/increase in cash and cash equivalents | (4,541) | 6,410 | (42,950) | (9,088) |
Cash and cash equivalents at beginning of period | 143,333 | 169,615 | 181,742 | 185,113 |
Cash and cash equivalents at end of period | $ 138,792 | $ 176,025 | $ 138,792 | $ 176,025 |
Significant Accounting Policies
Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 1. Significant Accounting Policies Basis of Presentation In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary for a fair presentation of results for such periods. Albany International Corp. (“Albany”) consolidates the financial results of its subsidiaries for all periods presented. The results for any interim period are not necessarily indicative of results for the full year. The preparation of financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in Albany International Corp.’s Consolidated Financial Statements and accompanying Notes. Actual results could differ materially from those estimates. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with “Risk Factors,” “Legal Proceedings,” “Management’s Discussion and Analysis of Financial Condition and Results of Operation,” “Quantitative and Qualitative Disclosures about Market Risk” and the Consolidated Financial Statements and Notes thereto included in Items 1A, 3, 7, 7A and 8, respectively, of the Albany International Corp. Annual Report on Form 10-K for the year ended December 31, 2016. |
Business Acquisition
Business Acquisition | 6 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
Business Acquisition | 2. On April 8, 2016, the Company acquired the outstanding shares of Harris Corporation’s composite aerostructures business for cash of $187 million, plus the assumption of certain liabilities. The Company funded the cash payable at closing by utilizing proceeds from a $550 million, unsecured credit facility agreement that was completed April 8, 2016. The acquired entity is located in Salt Lake City, Utah (“SLC”) and is part of the Albany Engineered Composites (“AEC”) segment. The Consolidated Statements of Income for 2016 includes operational activity of the acquired business for only the period subsequent to the closing, which affects comparability of results. The following table shows total Company pro forma results for the three and six month periods ended June 30, 2016 as if the acquisition had occurred on January 1, 2015. (in thousands, except per share amounts) Three months ended June 30, 2016 Six months ended June 30, 2016 Combined Net sales $204,371 $397,706 Combined Income before income taxes $15,765 $38,915 Pro forma increase/(decrease) to income before income taxes: Acquisition expenses 3,771 5,367 Interest expense related to purchase price (81 ) (1,133 ) Acquisition accounting adjustments: Depreciation and amortization on property, plant and equipment, and intangible assets (121 ) (1,696 ) Valuation of contract inventories 145 2,036 Interest expense on captial lease obligation 23 323 Interest expense on other obligations (10 ) (143 ) Pro forma Income before income taxes $19,492 $43,669 Pro forma Net Income $11,922 $28,187 |
Reportable Segments
Reportable Segments | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Reportable Segments | 3. Reportable Segments The following tables show data by reportable segment, reconciled to consolidated totals included in the financial statements: Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Net sales Machine Clothing $146,572 $148,934 $289,399 $294,197 Albany Engineered Composites (AEC) 68,999 54,256 125,449 81,324 Consolidated total $215,571 $203,190 $414,848 $375,521 Operating income/(loss) Machine Clothing 38,418 35,405 76,679 72,543 Albany Engineered Composites (17,828 ) (5,848 ) (22,942 ) (9,553 ) Corporate expenses (11,362 ) (11,700 ) (22,453 ) (22,864 ) Operating income $9,228 $17,857 $31,284 $40,126 Reconciling items: Interest income (340 ) (547 ) (447 ) (673 ) Interest expense 4,625 4,238 9,060 6,602 Other expense/(income), net 1,931 (2,017 ) 2,135 (2,345 ) Income before income taxes $3,012 $16,183 $20,536 $36,542 There were no material changes in the total assets of the reportable segments in the first six months of 2017. In the second quarter of 2017, the Company recorded a charge to Cost of goods sold of approximately $15.8 million associated with revisions in the estimated profitability of two AEC contracts. The charge was principally due to second-quarter 2017 downward revisions of estimated customer demand for the components manufactured by AEC related to the BR 725 and A380 programs. The charge included a $4.0 million write-off of program inventory costs, and a reserve for future losses of $11.8 million, which is included in Accrued liabilities in the Consolidated Balance Sheets. Total reserves for future contract losses were $11.8 million as of June 30, 2017, and $0.1 million as of December 31, 2016. The Albany Engineered Composites (AEC) segment, including Albany Safran Composites, LLC (ASC), in which our customer SAFRAN Group (Safran) owns a 10 percent noncontrolling interest, provides highly engineered, advanced composite structures to customers in the aerospace and defense industries. AEC’s largest program relates to CFM International’s LEAP engine. Under this program, AEC through ASC, is the exclusive supplier of advanced composite fan blades and cases under a long-term supply contract. The manufacturing spaces used for the production of parts under the long-term supply agreement are owned by Safran, and leased to the Company at either a market rent or a minimal cost. All lease expense is reimbursable by Safran to the Company due to the cost-plus nature of the supply agreement. AEC net sales to Safran in 2017 were $25.6 million in the first quarter and $30.1 million in the second quarter. AEC net sales to Safran in 2016 were $17.1 million in the first quarter and $18.5 million in the second quarter. The total of invoiced receivables, unbilled receivables and contract receivables due from Safran amounted to $55.5 million and $37.1 million as of June 30, 2017 and December 31, 2016, respectively. The table below presents restructuring costs by reportable segment (also see Note 5): Three months ended Six months ended June 30, (in thousands) 2017 2016 2017 2016 Restructuring expenses, net Machine Clothing $805 $5,434 $916 $6,132 Albany Engineered Composites 1,231 1,147 3,801 1,147 Corporate expenses - 67 - 48 Consolidated total $2,036 $6,648 $4,717 $7,327 |
Pensions and Other Postretireme
Pensions and Other Postretirement Benefit Plans | 6 Months Ended |
Jun. 30, 2017 | |
Retirement Benefits [Abstract] | |
Pensions and Other Postretirement Benefit Plans | 4. Pensions and Other Postretirement Benefit Plans Pension Plans The Company has defined benefit pension plans covering certain U.S. and non-U.S. employees. The U.S. qualified defined benefit pension plan has been closed to new participants since October 1998 and, as of February 2009, benefits accrued under this plan were frozen. As a result of the freeze, employees covered by the pension plan will receive, at retirement, benefits already accrued through February 2009 but no new benefits accrue after that date. Benefit accruals under the U.S. Supplemental Executive Retirement Plan ("SERP") were similarly frozen. The eligibility, benefit formulas, and contribution requirements for plans outside of the U.S. vary by location. Other Postretirement Benefits The Company also provides certain postretirement benefits to retired employees in the U.S. and Canada. The Company accrues the cost of providing postretirement benefits during the active service period of the employees. The Company currently funds the plan as claims are paid. The composition of the net periodic benefit plan cost for the six months ended June 30, 2017 and 2016, was as follows: Pension plans Other postretirement benefits (in thousands) 2017 2016 2017 2016 Components of net periodic benefit cost: Service cost $1,307 $1,319 $122 $127 Interest cost 3,671 4,049 1,107 1,221 Expected return on assets (4,003 ) (4,482 ) - - Amortization of prior service cost/(credit) 18 19 (2,244 ) (2,244 ) Amortization of net actuarial loss 1,295 1,164 1,405 1,410 Net periodic benefit cost $2,288 $2,069 $390 $514 |
Restructuring
Restructuring | 6 Months Ended |
Jun. 30, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | 5. Restructuring Machine Clothing restructuring costs for the first six months of 2017 were principally related to additional costs for restructuring in France. Machine Clothing restructuring costs in 2016 were principally related to plant closure costs in Göppingen, Germany and the cessation of research and development activities at the production facility in Sélestat, France. AEC incurred restructuring charges of $3.8 million in the first six months of 2017, principally related to a reduction in personnel in Salt Lake City, Utah. AEC restructuring expenses in 2016 were principally related to the consolidation of legacy programs into Boerne, Texas. The following table summarizes charges reported in the Consolidated Statements of Income under “Restructuring expenses, net”: Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Machine Clothing $805 $5,434 $916 $6,132 Albany Engineered Composites 1,231 1,147 3,801 1,147 Corporate Expenses - 67 - 48 Total $2,036 $6,648 $4,717 $7,327 Six months ended June 30, 2017 Total restructuring costs incurred Termination and other costs Impairment of plant and equipment (in thousands) Machine Clothing $916 $916 $- Albany Engineered Composites 3,801 3,356 445 Corporate Expenses - - - Total $4,717 $4,272 $445 Six months ended June 30, 2016 Total restructuring costs incurred Termination and other costs Impairment of plant and equipment (in thousands) Machine Clothing $6,132 $5,832 $300 Albany Engineered Composites 1,147 921 226 Corporate Expenses 48 48 - Total $7,327 $6,801 $526 We expect that approximately $5.0 million of Accrued liabilities for restructuring at June 30, 2017 will be paid within one year and approximately $0.4 million will be paid in the following year. The table below presents the year-to-date changes in restructuring liabilities for 2017 and 2016, all of which related to termination costs: (in thousands) December 31, 2016 Restructuring charges accrued Payments Currency translation / June 30, 2017 Total termination and other costs $5,559 $4,272 ($4,513 ) $65 $5,383 (in thousands) December 31, Restructuring charges accrued Payments Currency translation / June 30, Total termination and other costs $10,177 $6,801 ($6,835 ) $13 $10,156 |
Other Expense_(Income), net
Other Expense/(Income), net | 6 Months Ended |
Jun. 30, 2017 | |
Other Income and Expenses [Abstract] | |
Other Expense/(Income), net | 6. Other Expense/(Income), net The components of other expense/(income), net are: Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Currency transaction losses/(gains) $1,948 ($1,571 ) $2,049 ($2,049 ) Bank fees and amortization of debt issuance costs 111 394 259 546 Other (128 ) (840 ) (173 ) (842 ) Total $1,931 ($2,017 ) $2,135 ($2,345 ) |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 7. Income Taxes The following table presents components of income tax expense for the three and six months ended June 30, 2017 and 2016: Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Income tax based on income from continuing operations, at estimated tax rates of 32.8% in 2017 and 38.7% in 2016, respectively $989 $6,258 $6,744 $14,131 Provision for change in estimated tax rate 36 (203 ) - - Income tax expense before discrete items 1,025 6,055 6,744 14,131 Discrete tax expense/(benefit): Provision for/resolution of tax audits and contingencies, net 109 - 961 (825 ) Uncertain Tax Positions 490 - 490 - Adjustments to prior period tax liabilities 189 - 189 (243 ) Other discrete tax adjustments, net (34 ) 27 (55 ) 62 Total income tax expense $1,779 $6,082 $8,329 $13,125 The second quarter estimated income tax rate based on continuing operations was 32.8 percent in 2017, compared to 38.7 percent for the same period in 2016. The Company records the residual U.S. and foreign taxes on certain amounts of foreign earnings that have been targeted for repatriation to the U.S. These amounts are not considered to be permanently reinvested, and the Company accrued for the tax cost on these earnings to the extent they cannot be repatriated in a tax-free manner. At June 30, 2017, the Company calculated a deferred tax liability of $4.5 million on $62.6 million of non-U.S. earnings that have been targeted for future repatriation to the U.S. The Company conducts business globally and, as a result, files income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. In the normal course of business the Company is subject to examination by taxing authorities throughout the world, including major jurisdictions such as United States, Brazil, Canada, France, Germany, Italy, Mexico and Switzerland. The open tax years range from 2007 to 2016. The Company is currently under audit in certain non-U.S. tax jurisdictions, including but not limited to Canada and Italy. It is reasonably possible that over the next twelve months the amount of unrecognized tax benefits may decrease up to $0.4 million from the reevaluation of uncertain tax positions arising in examinations, in appeals, or in the courts, or from the closure of tax statutes of limitations. In March 2016, an accounting update was issued which simplified several aspects related to accounting for share-based payment transactions, including the income tax consequences. The Company adopted this update on January 1, 2017. The income tax consequences which related to accounting for excess tax benefits have been adopted prospectively, resulting in recognition of excess tax benefits against income tax expense rather than additional paid-in capital of $0.6 million for the six months ended June 30, 2017. No adjustment was necessary related to the deferred tax balances. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 8. Earnings Per Share The amounts used in computing earnings per share and the weighted average number of shares of potentially dilutive securities are as follows: Three months ended Six months ended (in thousands, except market price and earnings per share) 2017 2016 2017 2016 Net income attributable to the Company $1,117 $10,367 $11,956 $23,868 Weighted average number of shares: Weighted average number of shares used in calculating basic net income per share 32,166 32,093 32,147 32,067 Effect of dilutive stock-based compensation plans: Stock options 34 38 35 39 Weighted average number of shares used in calculating diluted net income per share 32,200 32,131 32,182 32,106 Average market price of common stock used for calculation of dilutive shares $48.44 $39.47 $47.47 $37.40 Net income per share: Basic $0.03 $0.32 $0.37 $0.74 Diluted $0.03 $0.32 $0.37 $0.74 |
Noncontrolling Interest
Noncontrolling Interest | 6 Months Ended |
Jun. 30, 2017 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interest | 9. Noncontrolling Interest The table below presents a reconciliation of income attributable to the noncontrolling interest and noncontrolling equity: Six months ended June 30, (in thousands) 2017 2016 Net income/(loss) of Albany Safran Composites, LLC ("ASC") $3,029 ($4,033 ) Less: Return attributable to the Company's preferred holding 515 480 Net income/(loss) of ASC available for common ownership $2,514 ($4,513 ) Ownership percentage of noncontrolling shareholder 10 % 10 % Net income/(loss) attributable to noncontrolling interest $251 ($451 ) Noncontrolling interest, beginning of year $3,767 $3,690 Net income/(loss) attributable to noncontrolling interest 251 (451 ) Changes in other comprehensive income attributable to noncontrolling interest 13 (1 ) Noncontrolling interest $4,031 $3,238 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (AOCI) | 6 Months Ended |
Jun. 30, 2017 | |
Accumulated items of other comprehensive income: | |
Accumulated Other Comprehensive Income (AOCI) | 10. Accumulated Other Comprehensive Income (AOCI) The table below presents changes in the components of AOCI for the period December 31, 2016 to June 30, 2017: (in thousands) Translation adjustments Pension and postretirement liability adjustments Derivative valuation adjustment Total Other Comprehensive Income December 31, 2016 ($133,298 ) ($51,719 ) $828 ($184,189 ) Other comprehensive income/(loss) before reclassifications 28,453 (1,079 ) (619 ) 26,755 Interest expense related to swaps reclassified to the Statement of Income, net of tax - - 585 585 Pension and postretirement liability adjustments reclassified to Statement of Income, net of tax - 332 - 332 Net current period other comprehensive income 28,453 (747 ) (34 ) 27,672 June 30, 2017 ($104,845 ) ($52,466 ) $794 ($156,517 ) The table below presents changes in the components of AOCI for the period December 31, 2015 to June 30, 2016: (in thousands) Translation adjustments Pension and postretirement liability adjustments Derivative valuation adjustment Total Other Comprehensive Income December 31, 2015 ($108,655 ) ($48,725 ) ($1,464 ) ($158,844 ) Other comprehensive income/(loss) before reclassifications 2,393 12 (4,608 ) (2,203 ) Pension/postretirement plan remeasurement - 105 - 105 Interest expense related to swaps reclassified to the Statement of Income, net of tax - - 363 363 Pension and postretirement liability adjustments reclassified to Statement of Income, net of tax - 244 - 244 Net current period other comprehensive income 2,393 361 (4,245 ) (1,491 ) June 30, 2016 ($106,262 ) ($48,364 ) ($5,709 ) ($160,335 ) The table below presents the expense/(income) amounts reclassified, and the line items of the Statements of Income that were affected for the periods ended June 30, 2017 and 2016. Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Pretax Derivative valuation reclassified from Accumulated Other Comprehensive Income: Expense related to interest rate swaps included in Income $343 $305 $943 $586 Income tax effect (130 ) (116 ) (358 ) (223 ) Effect on net income due to items reclassified from Accumulated Other Comprehensive Income $213 $189 $585 $363 Pretax pension and postretirement liabilities reclassified from Accumulated Other Comprehensive Income: Amortization of prior service credit ($1,113 ) ($1,112 ) ($2,226 ) ($2,225 ) Amortization of net actuarial loss 1,353 1,296 2,700 2,574 Total pretax amount reclassified (b) 240 184 474 349 Income tax effect (72 ) (56 ) (142 ) (105 ) Effect on net income due to items reclassified from Accumulated Other Comprehensive Income $168 $128 $332 $244 (a) Included in Interest expense are payments related to the interest rate swap agreements and amortization of swap buyouts (see Note 15). (b) These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note 4). |
Accounts Receivable
Accounts Receivable | 6 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
Accounts Receivable | 11. Accounts Receivable Accounts receivable includes trade receivables and revenue in excess of progress billings on long-term contracts in the Albany Engineered Composites segment. The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. The Company determines the allowance based on historical write-off experience, customer-specific facts and economic conditions. If the financial condition of the Company’s customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. As of June 30, 2017 and December 31, 2016, Accounts receivable consisted of the following: (in thousands) June 30, December 31, Trade and other accounts receivable $152,410 $146,460 Bank promissory notes 17,009 15,759 Revenue in excess of progress billings 30,664 15,926 Allowance for doubtful accounts (7,018 ) (6,952 ) Total accounts receivable $193,065 $171,193 In connection with certain sales in Asia, the Company accepts a bank promissory note as customer payment. The notes may be presented for payment at maturity, which is less than one year. The Company also has Contract receivables in the AEC segment that represent revenue earned which has extended payment terms. The Contract receivables will be invoiced to the customer, with 2% interest, over a 10-year period starting in 2020. As of June 30, 2017 and December 31, 2016, Contract Receivables consisted of the following: (in thousands) June 30, 2017 December 31, 2016 Contract receivable $21,581 $14,045 |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | 12. Inventories Costs included in inventories are raw materials, labor, supplies and allocable depreciation and overhead. Raw material inventories are valued on an average cost basis. Other inventory cost elements are valued at cost, using the first-in, first-out method. The Company writes down the inventories for estimated obsolescence, and to lower of cost or net realizable value based upon assumptions about future demand and market conditions. If actual demand or market conditions are less favorable than those projected by the Company, additional inventory write-downs may be required. Once established, the original cost of the inventory less the related write-down represents the new cost basis of such inventories. The AEC segment has long-term contracts under which we incur engineering and development costs that are allocable to parts that will be delivered over multiple years. These costs are included in Work in process in the table below. As of June 30, 2017 and December 31, 2016, inventories consisted of the following: (in thousands) June 30, December 31, Raw materials $40,474 $37,691 Work in process 75,917 58,715 Finished goods 35,143 37,500 Total inventories $151,534 $133,906 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 6 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | 13. Goodwill and Other Intangible Assets Goodwill and intangible assets with indefinite useful lives are not amortized, but are tested for impairment at least annually. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in each business combination. Determining the fair value of a reporting unit requires the use of significant estimates and assumptions, including revenue growth rates, operating margins, discount rates, and future market conditions, among others. Goodwill and other long-lived assets are reviewed for impairment whenever events, such as significant changes in the business climate, plant closures, changes in product offerings, or other circumstances indicate that the carrying amount may not be recoverable. To determine fair value, we utilize two market-based approaches and an income approach. Under the market-based approaches, we utilize information regarding the Company as well as publicly available industry information to determine earnings multiples and sales multiples. Under the income approach, we determine fair value based on estimated future cash flows of each reporting unit, discounted by an estimated weighted-average cost of capital, which reflects the overall level of inherent risk of a reporting unit and the rate of return an outside investor would expect to earn. In the second quarter of 2017, the Company applied the qualitative assessment approach in performing its annual evaluation of goodwill and concluded that no impairment provision was required. There were no amounts at risk due to the large spread between the fair, and carrying value, of each reporting unit. We are continuing to amortize certain patents, trade names, customer relationships, customer contracts and technology assets that have finite lives. The gross carrying value, accumulated amortization and net values of intangible assets and goodwill as of December 31, 2016 to June 30, 2017, were as follows: As of June 30, 2017 (in thousands) Weighted average amortization life in years Gross carrying amount Accumulated amortization Net carrying amount Amortized intangible assets: AEC trade names 15 $43 $25 $18 AEC technology 15 228 136 92 Customer relationships 15 49,490 4,131 45,359 Customer contracts 6 20,420 4,263 16,157 Other intangibles 5 1,720 430 1,290 Total amortized intangible assets $71,901 $8,985 $62,916 Unamortized intangible assets: MC Goodwill $68,598 $- $68,598 AEC Goodwill 95,730 - 95,730 Total unamortized intangible assets: $164,328 $- $164,328 As of December 31, 2016 (in thousands) Weighted average amortization life in years Gross carrying amount Accumulated amortization Net carrying amount Amortized intangible assets: AEC trade names 15 $43 $23 $20 AEC technology 15 228 124 104 Customer relationships 15 49,490 2,481 47,009 Customer contracts 6 20,420 2,561 17,859 Other intangibles 5 1,720 258 1,462 Total amortized intangible assets $71,901 $5,447 $66,454 Unamortized intangible assets: MC Goodwill $64,645 $- $64,645 AEC Goodwill 95,730 - 95,730 Total unamortized intangible assets: $160,375 $- $160,375 The changes in intangible assets and goodwill from December 31, 2016 to June 30, 2017, were as follows: (in thousands) December 31, Amortization Currency Translation June 30, 2017 Amortized intangible assets: AEC trade names $20 $(2 ) $- $18 AEC technology 104 (12 ) - 92 Customer relationships 47,009 (1,650 ) - 45,359 Customer contracts 17,859 (1,702 ) - 16,157 Other intangibles 1,462 (172 ) - 1,290 Total amortized intangible assets $66,454 ($3,538 ) $- $62,916 Unamortized intangible assets: MC Goodwill $64,645 $- $3,953 $68,598 AEC Goodwill 95,730 - - 95,730 Total unamortized intangible assets: $160,375 $- $3,953 $164,328 Estimated amortization expense of intangibles for the years ending December 31, 2017 through 2021, is as follows: Annual amortization Year (in thousands) 2017 $7,076 2018 7,076 2019 7,076 2020 7,076 2021 6,796 |
Financial Instruments
Financial Instruments | 6 Months Ended |
Jun. 30, 2017 | |
Long-term Debt and Capital Lease Obligations [Abstract] | |
Financial Instruments | 14. Financial Instruments Long-term debt, principally to banks and bondholders, consists of: (in thousands, except interest rates) June 30, 2017 December 31, 2016 Private placement with a fixed interest rate of 6.84%, due 2017 $50,000 $50,000 Revolving credit agreement with borrowings outstanding at an end of period interest rate of 2.70% in 2017 and 2.58% in 2016 (including the effect of interest rate hedging transactions, as described below), due in 2021 430,000 418,000 Obligation under capital lease, matures 2022 15,762 16,584 Long-term debt 495,762 484,584 Less: current portion (51,732) (51,666) Long-term debt, net of current portion $444,030 $432,918 A note agreement and guaranty (“Prudential Agreement”) was originally entered into in October 2005 with the Prudential Insurance Company of America, and certain other purchasers, with interest at 6.84%. The remaining principal under the Prudential Agreement is $50.0 million, and is due on the maturity date of October 25, 2017. At the noteholders’ election, certain prepayments may also be required in connection with certain asset dispositions or financings. The notes may not otherwise be prepaid without a premium, under certain market conditions. The Prudential Agreement contains customary terms, as well as affirmative covenants, negative covenants, and events of default, comparable to those in our current principal credit facility agreement (as described below). The Prudential Agreement has been amended a number of times, most recently in April 2016, in order to maintain terms comparable to our current principal credit facility. For disclosure purposes, we are required to measure the fair value of outstanding debt on a recurring basis. As of June 30, 2017, the fair value of this debt was approximately $51.5 million, and was measured using active market interest rates, which would be considered Level 2 for fair value measurement purposes. On April 8, 2016, we entered into a $550 million unsecured Five-Year Revolving Credit Facility Agreement (the “Credit Agreement”) which amended and restated the prior $400 million Agreement, entered into on June 18, 2015 (the “Prior Agreement”). Under the Credit Agreement, $430 million of borrowings were outstanding as of June 30, 2017. The applicable interest rate for borrowings was LIBOR plus a spread, based on our leverage ratio at the time of borrowing. At the time of the last borrowing on June 23, 2017, the spread was 1.500%. The spread was based on a pricing grid, which ranged from 1.250% to 1.750%, based on our leverage ratio. Based on our maximum leverage ratio and our Consolidated EBITDA, and without modification to any other credit agreements, as of June 30, 2017, we would have been able to borrow an additional $120 million under the Agreement. The Credit Agreement contains customary terms, as well as affirmative covenants, negative covenants and events of default comparable to those in the Prior Agreement. The Borrowings are guaranteed by certain of the Company's subsidiaries. Our ability to borrow additional amounts under the Credit Agreement is conditional upon the absence of any defaults, as well as the absence of any material adverse change (as defined in the Credit Agreement). The Company has a long-term capital lease obligation for real property in Salt Lake City, Utah. The lease has an implied interest rate of 5.0% and matures in 2022. The following schedule presents future minimum annual lease payments under the capital lease obligation and the present value of the minimum lease payments, as of June 30, 2017. Years ending December 31, (in thousands) 2017 $1,212 2018 2,473 2019 2,473 2020 2,520 2021 2,520 Thereafter 7,373 Total minimum lease payments 18,571 Less: Amount representing interest (2,809 ) Present value of minimum lease payments $15,762 On May 6, 2016, we terminated our interest rate swap agreements that had effectively fixed the interest rate on up to $120 million of revolving credit borrowings, in order to enter into a new interest rate swap with a greater notional amount, and the same maturity as the Credit Agreement. We paid $5.2 million to terminate the swap agreements and that cost will be amortized into interest expense through June 2020. On May 9, 2016, we entered into interest rate hedges for the period May 16, 2016 through March 16, 2021. These transactions have the effect of fixing the LIBOR portion of the effective interest rate (before addition of the spread) on $300 million of indebtedness drawn under the Credit Agreement at the rate of 1.245% during the period. Under the terms of these transactions, we pay the fixed rate of 1.245% and the counterparties pay a floating rate based on the one-month LIBOR rate at each monthly calculation date, which on June 16, 2017 was 1.180%, plus the applicable spread, during the swap period. On June 16, 2017, the all-in-rate on the $300 million of debt was 2.745%. These interest rate swaps are accounted for as a hedge of future cash flows, as further described in Note 15 of the Notes to Consolidated Financial Statements. No cash collateral was received or pledged in relation to the swap agreements. Under the Credit Agreement and Prudential Agreement, we are currently required to maintain a leverage ratio (as defined in the agreements) of not greater than 3.50 to 1.00 and minimum interest coverage (as defined) of 3.00 to 1.00. As of June 30, 2017, our leverage ratio was 2.55 to 1.00 and our interest coverage ratio was 9.41 to 1.00. We may purchase our Common Stock or pay dividends to the extent our leverage ratio remains at or below 3.50 to 1.00, and may make acquisitions with cash provided our leverage ratio would not exceed 3.50 to 1.00 after giving pro forma effect to any such acquisition. Indebtedness under each of the Prudential Agreement and the Credit Agreement is ranked equally in right of payment to all unsecured senior debt. We were in compliance with all debt covenants as of June 30, 2017. |
Fair-Value Measurements
Fair-Value Measurements | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair-Value Measurements | 15. Fair-Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Accounting principles establish a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Level 3 inputs are unobservable data points for the asset or liability, and include situations in which there is little, if any, market activity for the asset or liability. We had no Level 3 financial assets or liabilities at December 31, 2016 or June 30, 2017. The following table presents the fair-value hierarchy for our Level 1 and Level 2 financial assets and liabilities, which are measured at fair value on a recurring basis: June 30, 2017 December 31, 2016 Quoted prices in active markets Significant other observable inputs Quoted prices in active markets Significant other observable inputs (in thousands) (Level 1) (Level 2) (Level 1) (Level 2) Fair Value Assets: Cash equivalents $11,742 $- $8,468 $- Prepaid expenses and other current assets: Foreign currency options 2 - - - Other Assets: Common stock of unaffiliated foreign public company 838 (a) - 762 (a) - Interest rate swaps - 5,307 (b) - 5,784 (c) (a) Original cost basis $0.5 million (b) Net of $19.1 million receivable floating leg and $13.8 million liability fixed leg (c) Net of $21.4 million receivable floating leg and $15.6 million liability fixed leg Cash equivalents include short-term securities that are considered to be highly liquid and easily tradable. These securities are valued using inputs observable in active markets for identical securities. The common stock of the unaffiliated foreign public company is traded in an active market exchange. The shares are measured at fair value using closing stock prices and are recorded in the Consolidated Balance Sheets as Other assets. The securities are classified as available for sale, and as a result any unrealized gain or loss is recorded in the Shareholders’ Equity section of the Consolidated Balance Sheets rather than in the Consolidated Statements of Income. When the security is sold or impaired, gains and losses are reported on the Consolidated Statements of Income. Investments are considered to be impaired when a decline in fair value is judged to be other than temporary. We operate our business in many regions of the world, and currency rate movements can have a significant effect on operating results. Foreign currency instruments are entered into periodically, and consist of foreign currency option contracts and forward contracts that are valued using quoted prices in active markets obtained from independent pricing sources. These instruments are measured using market foreign exchange prices and are recorded in the Consolidated Balance Sheets as Other current assets and Accounts payable, as applicable. Changes in fair value of these instruments are recorded as gains or losses within Other (income)/expenses, net. When exercised, the foreign currency instruments are net settled with the same financial institution that bought or sold them. For all positions, whether options or forward contracts, there is risk from the possible inability of the financial institution to meet the terms of the contracts and the risk of unfavorable changes in interest and currency rates, which may reduce the value of the instruments. We seek to control risk by evaluating the creditworthiness of counterparties and by monitoring the currency exchange and interest rate markets while reviewing the hedging risks and contracts to ensure compliance with our internal guidelines and policies. Changes in exchange rates can result in revaluation gains and losses that are recorded in Selling, General and Administrative expenses or Other (income)/expenses, net. Revaluation gains and losses occur when our business units have cash, intercompany (recorded in Other (income)/expenses, net) or third-party trade (recorded in Selling, General and Administrative expenses) receivable or payable balances in a currency other than their local reporting (or functional) currency. Operating results can also be affected by the translation of sales and costs, for each non-U.S. subsidiary, from the local functional currency to the U.S. dollar. The translation effect on the Consolidated Statements of Income is dependent on our net income or expense position in each non-U.S. currency in which we do business. A net income position exists when sales realized in a particular currency exceed expenses paid in that currency; a net expense position exists if the opposite is true. The interest rate swaps are accounted for as hedges of future cash flows. The fair value of our interest rate swaps are derived from a discounted cash flow analysis based on the terms of the contract and the interest rate curve, and is included in Other assets and/or Other noncurrent liabilities in the Consolidated Balance Sheets. Unrealized gains and losses on the swaps flow through the caption Derivative valuation adjustment in the Shareholders’ equity section of the Consolidated Balance Sheets, to the extent that the hedges are highly effective. As of June 30, 2017, these interest rate swaps were determined to be highly effective hedges of interest rate cash flow risk. Any gains and losses related to the ineffective portion of the hedges will be recognized in the current period in earnings. Amounts accumulated in Other comprehensive income are reclassified as Interest expense, net when the related interest payments (that is, the hedged forecasted transactions), and amortization related to the swap buyouts, affect earnings. Interest expense related to the current swaps totaled $0.5 million for the six month period ended June 30, 2017 and $0.6 million for the six month period ended June 30, 2016. Additionally, interest expense related to the swap buyouts totaled $0.4 million for the six month period ended June 30, 2017 and $0.1 million of the six month period ended June 30, 2016. Gains and losses related to changes in fair value of derivative instruments that were recognized in Other expenses/(income), net in the Consolidated Statements of Income were as follows: Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Derivatives not designated as hedging instruments Foreign currency options (losses)/gains ($75 ) $250 ($129 ) $455 |
Contingencies
Contingencies | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | 16. Contingencies Asbestos Litigation Albany International Corp. is a defendant in suits brought in various courts in the United States by plaintiffs who allege that they have suffered personal injury as a result of exposure to asbestos-containing paper machine clothing synthetic dryer fabrics marketed during the period from 1967 to 1976 and used in certain paper mills. We were defending 3,737 claims as of June 30, 2017. The following table sets forth the number of claims filed, the number of claims settled, dismissed or otherwise resolved, and the aggregate settlement amount during the periods presented: Year ended Opening Number of Claims Claims Dismissed,Settled, or Resolved New Claims Closing Number of Claims Amounts Paid (thousands) to Settle or Resolve 2012 4,446 90 107 4,463 $530 2013 4,463 230 66 4,299 78 2014 4,299 625 147 3,821 437 2015 3,821 116 86 3,791 164 2016 3,791 148 102 3,745 758 2017 (as of June 30) 3,745 39 31 3,737 $10 We anticipate that additional claims will be filed against the Company and related companies in the future, but are unable to predict the number and timing of such future claims. Due to the fact that information sufficient to meaningfully estimate a range of possible loss of a particular claim is typically not available until late in the discovery process, we do not believe a meaningful estimate can be made regarding the range of possible loss with respect to pending or future claims. While we believe we have meritorious defenses to these claims, we have settled certain claims for amounts we consider reasonable given the facts and circumstances of each case. Our insurance carrier has defended each case and funded settlements under a standard reservation of rights. As of June 30, 2017 we had resolved, by means of settlement or dismissal, 37,528 claims. The total cost of resolving all claims was $10.2 million. Of this amount, almost 100% was paid by our insurance carrier, who has confirmed that we have approximately $140 million of remaining coverage under primary and excess policies that should be available with respect to current and future asbestos claims. The Company’s subsidiary, Brandon Drying Fabrics, Inc. (“Brandon”), is also a separate defendant in many of the asbestos cases in which Albany is named as a defendant, despite never having manufactured any fabrics containing asbestos. While Brandon was defending against 7,706 claims as of June 30, 2017, only eight claims have been filed against Brandon since January 1, 2012, and no settlement costs have been incurred since 2001. Brandon was acquired by the Company in 1999, and has its own insurance policies covering periods prior to 1999. Since 2004, Brandon’s insurance carriers have covered 100% of indemnification and defense costs, subject to policy limits and a standard reservation of rights. In some of these asbestos cases, the Company is named both as a direct defendant and as the “successor in interest” to Mount Vernon Mills (“Mount Vernon”). We acquired certain assets from Mount Vernon in 1993. Certain plaintiffs allege injury caused by asbestos-containing products alleged to have been sold by Mount Vernon many years prior to this acquisition. Mount Vernon is contractually obligated to indemnify the Company against any liability arising out of such products. We deny any liability for products sold by Mount Vernon prior to the acquisition of the Mount Vernon assets. Pursuant to its contractual indemnification obligations, Mount Vernon has assumed the defense of these claims. On this basis, we have successfully moved for dismissal in a number of actions. We currently do not anticipate, based on currently available information, that the ultimate resolution of the aforementioned proceedings will have a material adverse effect on the financial position, results of operations, or cash flows of the Company. Although we cannot predict the number and timing of future claims, based on the foregoing factors, the trends in claims filed against us, and available insurance, we also do not currently anticipate that potential future claims will have a material adverse effect on our financial position, results of operations, or cash flows. |
Changes in Shareholders' Equity
Changes in Shareholders' Equity | 6 Months Ended |
Jun. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
Changes in Shareholders' Equity | 17. Changes in Shareholders’ Equity The following table summarizes changes in Shareholders’ Equity: (in thousands) Common Stock Class A and B Additional paid in capital Retained earnings Accumulated items of other comprehensive income/(loss) Treasury stock Noncontrolling Interest Total Equity December 31, 2016 $40 $425,953 $522,855 ($184,189 ) ($257,136 ) $3,767 $511,290 Net income - - 11,956 - - 251 12,207 Compensation and benefits paid or payable in shares - 1,410 - - 260 - 1,670 Options exercised - 175 - - - - 175 Dividends declared - - (10,936 ) - - - (10,936 ) Cumulative translation adjustments - - - 28,453 - 13 28,466 Pension and postretirement liability adjustments - - - (747 ) - - (747 ) Derivative valuation adjustment - - - (34 ) - - (34 ) June 30, 2017 $40 $427,538 $523,875 ($156,517 ) ($256,876 ) $4,031 $542,091 |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | 18. Recent Accounting Pronouncements In May 2014, an accounting update was issued that replaces the existing revenue recognition framework regarding contracts with customers. We will adopt the standard on January 1, 2018 using the cumulative effect method for transitioning to the new standard. In our Machine Clothing segment, we currently record revenue for the sale of a product when persuasive evidence of an arrangement exists, delivery has occurred, title has been transferred, the selling price is fixed, and collectability is reasonably assured. In this segment, we often have contracts with customers whereby the Company satisfies its performance obligation related to the manufacture and delivery of a product before title has transferred to the customer. Under the new accounting standard, this will result in earlier recognition of revenue associated with these contracts. The selling price of products may include a performance obligation to provide certain support services for no additional cost. When we adopt the new standard, it is probable that, for some of these arrangements, we will need to allocate a portion of the associated revenue to such services. We currently estimate less than 5% of revenue will be allocated to such services. While we currently expect that the timing of revenue recognition and the line-item description of Machine Clothing revenue will be affected by the new standard, we do not expect a significant effect in total annual Machine Clothing revenue. We are continuing to assess the effect that the new revenue recognition will have on the Albany Engineered Composites (AEC) segment and expect to provide more information in our next quarterly report. One change that we anticipate is that we use the units-of-delivery method for some long-term contracts, which is considered an output method. Under the new standard, we expect that revenue for most of these contracts will be recognized over time using an input method as the measure of progress, which is expected to result in earlier recognition of revenue. We are currently unable to determine the full effect that the new standard will have on our financial statements. We are also currently unable to quantify the cumulative effect of adopting the new standard. The new standard will also require some additional footnote disclosures, including footnote disclosure of 2018 results under the current standard. In January 2016, an accounting update was issued which requires entities to present separately in Other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk if the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. This accounting update is effective for reporting periods beginning after December 15, 2017. We have not determined the impact of this update on our financial statements. In February 2016, an accounting update was issued which requires lessees to recognize most leases on the balance sheet. The update may significantly increase reported assets and liabilities. This accounting update is effective for reporting periods beginning after December 15, 2018. We have not determined the impact of this update on our financial statements. In March 2016, an accounting update was issued which simplifies several aspects related to the accounting for share-based payment transactions, including the income tax consequences, statutory tax withholding requirements, and classification of excess tax benefits and cash paid to a tax authority in lieu of share issuances to employees on the statements of cash flows. The update also affects presentation in the Statements of Cash Flows of income tax effects of shares withheld for incentive compensation, and the exercise of stock options. We adopted this accounting update January 1, 2017 and it had an insignificant effect on income tax expense. The updates affecting the Statements of Cash Flows have been applied retrospectively as follows: - As a result of the change affecting cash payments of taxes in lieu of share issuance, operating cash flows for the six month period ending June 30, 2016 were increased $1.3 million and financing cash flows were decreased by the same amount. - As a result of the change affecting classification of excess tax benefits, operating cash flows for the six month period ending June 30, 2016 cash flows were increased $0.1 million and financing cash flows were decreased by the same amount. In October 2016, an accounting update was issued which modifies the recognition of income tax effects on intracompany transfers of assets, other than inventory. This accounting update is effective for reporting periods beginning after December 15, 2017. We have not determined the effect of this update on our financial statements. In November 2016, an accounting update was issued which provides clarification of how changes in restricted cash should be reported in the statement of cash flows. This accounting update is effective for reporting periods beginning after December 15, 2017. We do not expect this update to have a material impact on our financial statements. In January 2017, an accounting update was issued which provides the definition of a business for the purposes of business combination accounting. This accounting update is effective for reporting periods beginning after December 15, 2017 and is to be applied prospectively. Accordingly, there will be no effect on prior business combinations. We have not determined the impact of the update due to the absence of transactions that would be impacted. In January 2017, an accounting update was issued which simplifies the process for determining the amount of goodwill impairment. We adopted this standard as of January 1, 2017 and it did not have any effect on the conclusions reached in our periodic goodwill impairment assessment. In March 2017, an accounting update was issued which requires that service cost for defined benefit pension and postretirement plans be reported in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. Additionally, the other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. This accounting update is effective for reporting periods beginning after December 15, 2017. We expect that the principal effect of adopting this standard will be to reclassify a portion of our pension and postretirement costs to Other expense/(income). In May 2017, an accounting update was issued to provide clarity as to when a company must account for changes to stock-based compensation programs as award modifications. Award modifications require an update to the value of the award, resulting in an adjustment to compensation expense. We have not made changes to awards in recent years that would be affected by this update, but such changes are possible in future periods. The update is effective for periods beginning after December 15, 2017. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary for a fair presentation of results for such periods. Albany International Corp. (“Albany”) consolidates the financial results of its subsidiaries for all periods presented. The results for any interim period are not necessarily indicative of results for the full year. The preparation of financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in Albany International Corp.’s Consolidated Financial Statements and accompanying Notes. Actual results could differ materially from those estimates. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with “Risk Factors,” “Legal Proceedings,” “Management’s Discussion and Analysis of Financial Condition and Results of Operation,” “Quantitative and Qualitative Disclosures about Market Risk” and the Consolidated Financial Statements and Notes thereto included in Items 1A, 3, 7, 7A and 8, respectively, of the Albany International Corp. Annual Report on Form 10-K for the year ended December 31, 2016. |
Business Acquisition (Tables)
Business Acquisition (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
Schedule of Proforma Statement of Operations | The following table shows total Company pro forma results for the three and six month periods ended June 30, 2016 as if the acquisition had occurred on January 1, 2015. (in thousands, except per share amounts) Three months ended June 30, 2016 Six months ended June 30, 2016 Combined Net sales $204,371 $397,706 Combined Income before income taxes $15,765 $38,915 Pro forma increase/(decrease) to income before income taxes: Acquisition expenses 3,771 5,367 Interest expense related to purchase price (81 ) (1,133 ) Acquisition accounting adjustments: Depreciation and amortization on property, plant and equipment, and intangible assets (121 ) (1,696 ) Valuation of contract inventories 145 2,036 Interest expense on captial lease obligation 23 323 Interest expense on other obligations (10 ) (143 ) Pro forma Income before income taxes $19,492 $43,669 Pro forma Net Income $11,922 $28,187 |
Reportable Segments and Geograp
Reportable Segments and Geographic Data (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Financial Data by Reporting Segment | The following tables show data by reportable segment, reconciled to consolidated totals included in the financial statements: Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Net sales Machine Clothing $146,572 $148,934 $289,399 $294,197 Albany Engineered Composites (AEC) 68,999 54,256 125,449 81,324 Consolidated total $215,571 $203,190 $414,848 $375,521 Operating income/(loss) Machine Clothing 38,418 35,405 76,679 72,543 Albany Engineered Composites (17,828 ) (5,848 ) (22,942 ) (9,553 ) Corporate expenses (11,362 ) (11,700 ) (22,453 ) (22,864 ) Operating income $9,228 $17,857 $31,284 $40,126 Reconciling items: Interest income (340 ) (547 ) (447 ) (673 ) Interest expense 4,625 4,238 9,060 6,602 Other expense/(income), net 1,931 (2,017 ) 2,135 (2,345 ) Income before income taxes $3,012 $16,183 $20,536 $36,542 |
Schedule of Restructuring Costs by Reporting Segment | The table below presents restructuring costs by reportable segment (also see Note 5): Three months ended Six months ended June 30, (in thousands) 2017 2016 2017 2016 Restructuring expenses, net Machine Clothing $805 $5,434 $916 $6,132 Albany Engineered Composites 1,231 1,147 3,801 1,147 Corporate expenses - 67 - 48 Consolidated total $2,036 $6,648 $4,717 $7,327 |
Pensions and Other Postretire28
Pensions and Other Postretirement Benefit Plans (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Retirement Benefits [Abstract] | |
Schedule of Net Periodic Benefit Plan Cost | The composition of the net periodic benefit plan cost for the six months ended June 30, 2017 and 2016, was as follows: Pension plans Other postretirement benefits (in thousands) 2017 2016 2017 2016 Components of net periodic benefit cost: Service cost $1,307 $1,319 $122 $127 Interest cost 3,671 4,049 1,107 1,221 Expected return on assets (4,003 ) (4,482 ) - - Amortization of prior service cost/(credit) 18 19 (2,244 ) (2,244 ) Amortization of net actuarial loss 1,295 1,164 1,405 1,410 Net periodic benefit cost $2,288 $2,069 $390 $514 |
Restructuring (Tables)
Restructuring (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Charges | The following table summarizes charges reported in the Consolidated Statements of Income under “Restructuring expenses, net”: Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Machine Clothing $805 $5,434 $916 $6,132 Albany Engineered Composites 1,231 1,147 3,801 1,147 Corporate Expenses - 67 - 48 Total $2,036 $6,648 $4,717 $7,327 Six months ended June 30, 2017 Total restructuring costs incurred Termination and other costs Impairment of plant and equipment (in thousands) Machine Clothing $916 $916 $- Albany Engineered Composites 3,801 3,356 445 Corporate Expenses - - - Total $4,717 $4,272 $445 Six months ended June 30, 2016 Total restructuring costs incurred Termination and other costs Impairment of plant and equipment (in thousands) Machine Clothing $6,132 $5,832 $300 Albany Engineered Composites 1,147 921 226 Corporate Expenses 48 48 - Total $7,327 $6,801 $526 |
Schedule of Restructuring Liability | The table below presents the year-to-date changes in restructuring liabilities for 2017 and 2016, all of which related to termination costs: (in thousands) December 31, 2016 Restructuring charges accrued Payments Currency translation / June 30, 2017 Total termination and other costs $5,559 $4,272 ($4,513 ) $65 $5,383 (in thousands) December 31, Restructuring charges accrued Payments Currency translation / June 30, Total termination and other costs $10,177 $6,801 ($6,835 ) $13 $10,156 |
Other Expense_(Income), net (Ta
Other Expense/(Income), net (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Other Income and Expenses [Abstract] | |
Schedule Other Expense/(Income), net | The components of other expense/(income), net are: Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Currency transaction losses/(gains) $1,948 ($1,571 ) $2,049 ($2,049 ) Bank fees and amortization of debt issuance costs 111 394 259 546 Other (128 ) (840 ) (173 ) (842 ) Total $1,931 ($2,017 ) $2,135 ($2,345 ) |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense | The following table presents components of income tax expense for the three and six months ended June 30, 2017 and 2016: Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Income tax based on income from continuing operations, at estimated tax rates of 32.8% in 2017 and 38.7% in 2016, respectively $989 $6,258 $6,744 $14,131 Provision for change in estimated tax rate 36 (203 ) - - Income tax expense before discrete items 1,025 6,055 6,744 14,131 Discrete tax expense/(benefit): Provision for/resolution of tax audits and contingencies, net 109 - 961 (825 ) Uncertain Tax Positions 490 - 490 - Adjustments to prior period tax liabilities 189 - 189 (243 ) Other discrete tax adjustments, net (34 ) 27 (55 ) 62 Total income tax expense $1,779 $6,082 $8,329 $13,125 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule Computing Earnings Per Share | The amounts used in computing earnings per share and the weighted average number of shares of potentially dilutive securities are as follows: Three months ended Six months ended (in thousands, except market price and earnings per share) 2017 2016 2017 2016 Net income attributable to the Company $1,117 $10,367 $11,956 $23,868 Weighted average number of shares: Weighted average number of shares used in calculating basic net income per share 32,166 32,093 32,147 32,067 Effect of dilutive stock-based compensation plans: Stock options 34 38 35 39 Weighted average number of shares used in calculating diluted net income per share 32,200 32,131 32,182 32,106 Average market price of common stock used for calculation of dilutive shares $48.44 $39.47 $47.47 $37.40 Net income per share: Basic $0.03 $0.32 $0.37 $0.74 Diluted $0.03 $0.32 $0.37 $0.74 |
Noncontrolling Interest (Tables
Noncontrolling Interest (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Noncontrolling Interest [Abstract] | |
Schedule of Income Attributable to Noncontrolling Interest and Noncontrolling Equity | The table below presents a reconciliation of income attributable to the noncontrolling interest and noncontrolling equity: Six months ended June 30, (in thousands) 2017 2016 Net income/(loss) of Albany Safran Composites, LLC ("ASC") $3,029 ($4,033 ) Less: Return attributable to the Company's preferred holding 515 480 Net income/(loss) of ASC available for common ownership $2,514 ($4,513 ) Ownership percentage of noncontrolling shareholder 10 % 10 % Net income/(loss) attributable to noncontrolling interest $251 ($451 ) Noncontrolling interest, beginning of year $3,767 $3,690 Net income/(loss) attributable to noncontrolling interest 251 (451 ) Changes in other comprehensive income attributable to noncontrolling interest 13 (1 ) Noncontrolling interest $4,031 $3,238 |
Accumulated Other Comprehensi34
Accumulated Other Comprehensive Income (AOCI) (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Accumulated items of other comprehensive income: | |
Schedule of Accumulated Other Comprehensive Income | The table below presents changes in the components of AOCI for the period December 31, 2016 to June 30, 2017: (in thousands) Translation adjustments Pension and postretirement liability adjustments Derivative valuation adjustment Total Other Comprehensive Income December 31, 2016 ($133,298 ) ($51,719 ) $828 ($184,189 ) Other comprehensive income/(loss) before reclassifications 28,453 (1,079 ) (619 ) 26,755 Interest expense related to swaps reclassified to the Statement of Income, net of tax - - 585 585 Pension and postretirement liability adjustments reclassified to Statement of Income, net of tax - 332 - 332 Net current period other comprehensive income 28,453 (747 ) (34 ) 27,672 June 30, 2017 ($104,845 ) ($52,466 ) $794 ($156,517 ) The table below presents changes in the components of AOCI for the period December 31, 2015 to June 30, 2016: (in thousands) Translation adjustments Pension and postretirement liability adjustments Derivative valuation adjustment Total Other Comprehensive Income December 31, 2015 ($108,655 ) ($48,725 ) ($1,464 ) ($158,844 ) Other comprehensive income/(loss) before reclassifications 2,393 12 (4,608 ) (2,203 ) Pension/postretirement plan remeasurement - 105 - 105 Interest expense related to swaps reclassified to the Statement of Income, net of tax - - 363 363 Pension and postretirement liability adjustments reclassified to Statement of Income, net of tax - 244 - 244 Net current period other comprehensive income 2,393 361 (4,245 ) (1,491 ) June 30, 2016 ($106,262 ) ($48,364 ) ($5,709 ) ($160,335 ) |
Schedule of Accumulated Other Comprehensive Income Components Reclassified to Statement of Income | The table below presents the expense/(income) amounts reclassified, and the line items of the Statements of Income that were affected for the periods ended June 30, 2017 and 2016. Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Pretax Derivative valuation reclassified from Accumulated Other Comprehensive Income: Expense related to interest rate swaps included in Income $343 $305 $943 $586 Income tax effect (130 ) (116 ) (358 ) (223 ) Effect on net income due to items reclassified from Accumulated Other Comprehensive Income $213 $189 $585 $363 Pretax pension and postretirement liabilities reclassified from Accumulated Other Comprehensive Income: Amortization of prior service credit ($1,113 ) ($1,112 ) ($2,226 ) ($2,225 ) Amortization of net actuarial loss 1,353 1,296 2,700 2,574 Total pretax amount reclassified (b) 240 184 474 349 Income tax effect (72 ) (56 ) (142 ) (105 ) Effect on net income due to items reclassified from Accumulated Other Comprehensive Income $168 $128 $332 $244 (a) Included in Interest expense are payments related to the interest rate swap agreements and amortization of swap buyouts (see Note 15). (b) These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note 4). |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable | As of June 30, 2017 and December 31, 2016, Accounts receivable consisted of the following: (in thousands) June 30, December 31, Trade and other accounts receivable $152,410 $146,460 Bank promissory notes 17,009 15,759 Revenue in excess of progress billings 30,664 15,926 Allowance for doubtful accounts (7,018 ) (6,952 ) Total accounts receivable $193,065 $171,193 |
Schedule of Contract Receivables | As of June 30, 2017 and December 31, 2016, Contract Receivables consisted of the following: (in thousands) June 30, 2017 December 31, 2016 Contract receivable $21,581 $14,045 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | As of June 30, 2017 and December 31, 2016, inventories consisted of the following: (in thousands) June 30, December 31, Raw materials $40,474 $37,691 Work in process 75,917 58,715 Finished goods 35,143 37,500 Total inventories $151,534 $133,906 |
Goodwill and Other Intangible37
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Intangible Assets and Goodwill | The gross carrying value, accumulated amortization and net values of intangible assets and goodwill as of December 31, 2016 to June 30, 2017, were as follows: As of June 30, 2017 (in thousands) Weighted average amortization life in years Gross carrying amount Accumulated amortization Net carrying amount Amortized intangible assets: AEC trade names 15 $43 $25 $18 AEC technology 15 228 136 92 Customer relationships 15 49,490 4,131 45,359 Customer contracts 6 20,420 4,263 16,157 Other intangibles 5 1,720 430 1,290 Total amortized intangible assets $71,901 $8,985 $62,916 Unamortized intangible assets: MC Goodwill $68,598 $- $68,598 AEC Goodwill 95,730 - 95,730 Total unamortized intangible assets: $164,328 $- $164,328 As of December 31, 2016 (in thousands) Weighted average amortization life in years Gross carrying amount Accumulated amortization Net carrying amount Amortized intangible assets: AEC trade names 15 $43 $23 $20 AEC technology 15 228 124 104 Customer relationships 15 49,490 2,481 47,009 Customer contracts 6 20,420 2,561 17,859 Other intangibles 5 1,720 258 1,462 Total amortized intangible assets $71,901 $5,447 $66,454 Unamortized intangible assets: MC Goodwill $64,645 $- $64,645 AEC Goodwill 95,730 - 95,730 Total unamortized intangible assets: $160,375 $- $160,375 The changes in intangible assets and goodwill from December 31, 2016 to June 30, 2017, were as follows: (in thousands) December 31, Amortization Currency Translation June 30, 2017 Amortized intangible assets: AEC trade names $20 $(2 ) $- $18 AEC technology 104 (12 ) - 92 Customer relationships 47,009 (1,650 ) - 45,359 Customer contracts 17,859 (1,702 ) - 16,157 Other intangibles 1,462 (172 ) - 1,290 Total amortized intangible assets $66,454 ($3,538 ) $- $62,916 Unamortized intangible assets: MC Goodwill $64,645 $- $3,953 $68,598 AEC Goodwill 95,730 - - 95,730 Total unamortized intangible assets: $160,375 $- $3,953 $164,328 |
Schedule of Estimated Amortization Expense | Estimated amortization expense of intangibles for the years ending December 31, 2017 through 2021, is as follows: Annual amortization Year (in thousands) 2017 $7,076 2018 7,076 2019 7,076 2020 7,076 2021 6,796 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Long-term Debt and Capital Lease Obligations [Abstract] | |
Schedule of Long-Term Debt | Long-term debt, principally to banks and bondholders, consists of: (in thousands, except interest rates) June 30, 2017 December 31, 2016 Private placement with a fixed interest rate of 6.84%, due 2017 $50,000 $50,000 Revolving credit agreement with borrowings outstanding at an end of period interest rate of 2.70% in 2017 and 2.58% in 2016 (including the effect of interest rate hedging transactions, as described below), due in 2021 430,000 418,000 Obligation under capital lease, matures 2022 15,762 16,584 Long-term debt 495,762 484,584 Less: current portion (51,732) (51,666) Long-term debt, net of current portion $444,030 $432,918 |
Schedule of Future Minimum Annual Capital Lease Obilgations | The following schedule presents future minimum annual lease payments under the capital lease obligation and the present value of the minimum lease payments, as of June 30, 2017. Years ending December 31, (in thousands) 2017 $1,212 2018 2,473 2019 2,473 2020 2,520 2021 2,520 Thereafter 7,373 Total minimum lease payments 18,571 Less: Amount representing interest (2,809 ) Present value of minimum lease payments $15,762 |
Fair-Value Measurements (Tables
Fair-Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Financial Assets and Liabilities | The following table presents the fair-value hierarchy for our Level 1 and Level 2 financial assets and liabilities, which are measured at fair value on a recurring basis: June 30, 2017 December 31, 2016 Quoted prices in active markets Significant other observable inputs Quoted prices in active markets Significant other observable inputs (in thousands) (Level 1) (Level 2) (Level 1) (Level 2) Fair Value Assets: Cash equivalents $11,742 $- $8,468 $- Prepaid expenses and other current assets: Foreign currency options 2 - - - Other Assets: Common stock of unaffiliated foreign public company 838 (a) - 762 (a) - Interest rate swaps - 5,307 (b) - 5,784 (c) (a) Original cost basis $0.5 million (b) Net of $19.1 million receivable floating leg and $13.8 million liability fixed leg (c) Net of $21.4 million receivable floating leg and $15.6 million liability fixed leg |
Schedule of (Losses)/Gains on Changes in Fair Value of Derivative Instruments | Gains and losses related to changes in fair value of derivative instruments that were recognized in Other expenses/(income), net in the Consolidated Statements of Income were as follows: Three months ended Six months ended (in thousands) 2017 2016 2017 2016 Derivatives not designated as hedging instruments Foreign currency options (losses)/gains ($75 ) $250 ($129 ) $455 |
Contingencies (Tables)
Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Changes in Claims | The following table sets forth the number of claims filed, the number of claims settled, dismissed or otherwise resolved, and the aggregate settlement amount during the periods presented: Year ended Opening Number of Claims Claims Dismissed,Settled, or Resolved New Claims Closing Number of Claims Amounts Paid (thousands) to Settle or Resolve 2012 4,446 90 107 4,463 $530 2013 4,463 230 66 4,299 78 2014 4,299 625 147 3,821 437 2015 3,821 116 86 3,791 164 2016 3,791 148 102 3,745 758 2017 (as of June 30) 3,745 39 31 3,737 $10 |
Changes in Shareholders' Equi41
Changes in Shareholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Activity in Shareholders' Equity | The following table summarizes changes in Shareholders’ Equity: (in thousands) Common Stock Class A and B Additional paid in capital Retained earnings Accumulated items of other comprehensive income/(loss) Treasury stock Noncontrolling Interest Total Equity December 31, 2016 $40 $425,953 $522,855 ($184,189 ) ($257,136 ) $3,767 $511,290 Net income - - 11,956 - - 251 12,207 Compensation and benefits paid or payable in shares - 1,410 - - 260 - 1,670 Options exercised - 175 - - - - 175 Dividends declared - - (10,936 ) - - - (10,936 ) Cumulative translation adjustments - - - 28,453 - 13 28,466 Pension and postretirement liability adjustments - - - (747 ) - - (747 ) Derivative valuation adjustment - - - (34 ) - - (34 ) June 30, 2017 $40 $427,538 $523,875 ($156,517 ) ($256,876 ) $4,031 $542,091 |
Business Acquisition (Narrative
Business Acquisition (Narrative) (Details) - USD ($) $ in Thousands | Apr. 08, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 18, 2015 |
Business Acquisition [Line Items] | ||||||
Cash consideration for acquisition | $ 187,000 | $ 187,000 | ||||
Credit Agreement [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Proceeds from unsecured credit facility agreement | $ 550,000 | $ 400,000 | ||||
Harris Corporation's Composite Aerostructures Division [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Cash consideration for acquisition | $ 187,000 |
Business Acquisition (Summary o
Business Acquisition (Summary of pro-forma information of AAC) (Details) - Harris Corporation's Composite Aerostructures Division [Member] - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2016 | Jun. 30, 2016 | |
Combined Net sales | $ 204,371 | $ 397,706 |
Combined Income before income taxes | 15,765 | 38,915 |
Pro forma increase/(decrease) to income before income taxes: | ||
Acquisition expenses | 3,771 | 5,367 |
Interest expense related to purchase price | (81) | (1,133) |
Acquisition accounting adjustments: | ||
Depreciation and amortization on property, plant and equipment, and intangible assets | (121) | (1,696) |
Valuation of contract inventories | 145 | 2,036 |
Interest expense on capital lease obligation | 23 | 323 |
Interest expense on other obligations | (10) | (143) |
Pro forma Income before income taxes | 19,492 | 43,669 |
Pro forma Net Income | $ 11,922 | $ 28,187 |
Reportable Segments (Narrative)
Reportable Segments (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2017 | Mar. 31, 2017 | Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Segment Reporting Information [Line Items] | |||||||
Cost of goods sold | $ 152,517 | $ 124,875 | $ 275,889 | $ 224,705 | |||
Net sales | 215,571 | 203,190 | 414,848 | 375,521 | |||
Albany Engineered Composites [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Cost of goods sold | 15,800 | ||||||
Write-off inventory cost | 4,000 | ||||||
Reserve for future loss | 11,800 | 11,800 | $ 100 | ||||
Net sales | 68,999 | 54,256 | 125,449 | $ 81,324 | |||
Albany Safran Composites, LLC [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Net sales | 30,100 | $ 25,600 | $ 18,500 | $ 17,100 | |||
Invoiced receivables, unbilled receivables and contract receivables | $ 55,500 | $ 55,500 | $ 37,100 |
Reportable Segments (Schedule o
Reportable Segments (Schedule of Financial Data by Reporting Segment) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Segment Reporting Information [Line Items] | ||||
Net sales | $ 215,571 | $ 203,190 | $ 414,848 | $ 375,521 |
Operating income/(loss) | 9,228 | 17,857 | 31,284 | 40,126 |
Interest income | (340) | (547) | (447) | (673) |
Interest expense | 4,625 | 4,238 | 9,060 | 6,602 |
Other expense/(income), net | 1,931 | (2,017) | 2,135 | (2,345) |
Income before income taxes | 3,012 | 16,183 | 20,536 | 36,542 |
Machine Clothing [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 146,572 | 148,934 | 289,399 | 294,197 |
Operating income/(loss) | 38,418 | 35,405 | 76,679 | 72,543 |
Albany Engineered Composites [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 68,999 | 54,256 | 125,449 | 81,324 |
Operating income/(loss) | (17,828) | (5,848) | (22,942) | (9,553) |
Corporate Expenses [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Operating income/(loss) | $ (11,362) | $ (11,700) | $ (22,453) | $ (22,864) |
Reportable Segments (Schedule46
Reportable Segments (Schedule of Restructuring Costs by Reporting Segment) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Restructuring expense | ||||
Restructuring expenses, net | $ 2,036 | $ 6,648 | $ 4,717 | $ 7,327 |
Machine Clothing [Member] | ||||
Restructuring expense | ||||
Restructuring expenses, net | 805 | 5,434 | 916 | 6,132 |
Albany Engineered Composites [Member] | ||||
Restructuring expense | ||||
Restructuring expenses, net | 1,231 | 1,147 | 3,801 | 1,147 |
Corporate Expenses [Member] | ||||
Restructuring expense | ||||
Restructuring expenses, net | $ 67 | $ 48 |
Pensions and Other Postretire47
Pensions and Other Postretirement Benefit Plans (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Pension Plans [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | $ 1,307 | $ 1,319 |
Interest cost | 3,671 | 4,049 |
Expected return on assets | (4,003) | (4,482) |
Amortization of prior service cost/(credit) | 18 | 19 |
Amortization of net actuarial loss | 1,295 | 1,164 |
Net periodic benefit cost | 2,288 | 2,069 |
Other Postretirement Benefits [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 122 | 127 |
Interest cost | 1,107 | 1,221 |
Expected return on assets | ||
Amortization of prior service cost/(credit) | (2,244) | (2,244) |
Amortization of net actuarial loss | 1,405 | 1,410 |
Net periodic benefit cost | $ 390 | $ 514 |
Restructuring (Narrative) (Deta
Restructuring (Narrative) (Details) $ in Thousands | Jun. 30, 2017USD ($) |
Restructuring and Related Activities [Abstract] | |
Accrued restructuring costs expected to be paid within one year | $ 5,000 |
Accrued restructuring costs expected to be paid in year two | $ 400 |
Restructuring (Schedule of Rest
Restructuring (Schedule of Restructuring Charges) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Restructuring and other, net | ||||
Restructuring expenses, net | $ 2,036 | $ 6,648 | $ 4,717 | $ 7,327 |
Machine Clothing [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 805 | 5,434 | 916 | 6,132 |
Albany Engineered Composites [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 1,231 | 1,147 | 3,801 | 1,147 |
Corporate Expenses [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | $ 67 | 48 | ||
Termination and other costs [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 4,272 | 6,801 | ||
Termination and other costs [Member] | Machine Clothing [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 916 | 5,832 | ||
Termination and other costs [Member] | Albany Engineered Composites [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 3,356 | 921 | ||
Termination and other costs [Member] | Corporate Expenses [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 48 | |||
Impairment of plant and equipment [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 445 | 526 | ||
Impairment of plant and equipment [Member] | Machine Clothing [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 300 | |||
Impairment of plant and equipment [Member] | Albany Engineered Composites [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 445 | 226 | ||
Impairment of plant and equipment [Member] | Corporate Expenses [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | ||||
Restructuring costs incurred [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 4,717 | 7,327 | ||
Restructuring costs incurred [Member] | Machine Clothing [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 916 | 6,132 | ||
Restructuring costs incurred [Member] | Albany Engineered Composites [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | 3,801 | 1,147 | ||
Restructuring costs incurred [Member] | Corporate Expenses [Member] | ||||
Restructuring and other, net | ||||
Restructuring expenses, net | $ 48 |
Restructuring (Schedule of Re50
Restructuring (Schedule of Restructuring Liability) (Details) - Termination and other costs [Member] - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Restructuring Reserve [Roll Forward] | ||
Beginning balance | $ 5,559 | $ 10,177 |
Restructuring charges accrued | 4,272 | 6,801 |
Payments | (4,513) | (6,835) |
Currency translation/other | 65 | 13 |
Ending balance | $ 5,383 | $ 10,156 |
Other Expense_(Income), net (De
Other Expense/(Income), net (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Other Income and Expenses [Abstract] | ||||
Currency transaction losses/(gains) | $ 1,948 | $ (1,571) | $ 2,049 | $ (2,049) |
Bank fees and amortization of debt issuance costs | 111 | 394 | 259 | 546 |
Other | (128) | (840) | (173) | (842) |
Total | $ 1,931 | $ (2,017) | $ 2,135 | $ (2,345) |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Income Tax Disclosure [Line Items] | ||
Unrepatriated foreign earnings | $ 4,500 | |
Net increase from the reevaluation of uncertain tax positions arising in examinations | 600 | |
Net decrease from the reevaluation of uncertain tax positions arising in examinations | $ 400 | |
Income Tax Expense Benefit Estimated Tax Rate | 32.80% | 38.70% |
Non-U.S. earnings that have been targeted for future repatriation | $ 62,600 | |
Earliest Tax Year [Member] | ||
Income Tax Disclosure [Line Items] | ||
Open tax years | 2,007 | |
Latest Tax Year [Member] | ||
Income Tax Disclosure [Line Items] | ||
Open tax years | 2,016 |
Income Taxes (Schedule of Compo
Income Taxes (Schedule of Components of Income Tax Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Income tax based on income from continuing operations, at estimated tax rates of 32.8% in 2017 and 38.7% in 2016, respectively | $ 989 | $ 6,258 | $ 6,744 | $ 14,131 |
Provision for change in estimated tax rate | 36 | (203) | ||
Income tax expense before discrete items | 1,025 | 6,055 | 6,744 | 14,131 |
Discrete tax expense/(benefit): | ||||
Provision for/resolution of tax audits and contingencies, net | 109 | 961 | (825) | |
Uncertain Tax Positions | 490 | 490 | ||
Adjustments to prior period tax liabilities | 189 | 189 | (243) | |
Other discrete tax adjustments, net | (34) | 27 | (55) | 62 |
Total income tax expense | $ 1,779 | $ 6,082 | $ 8,329 | $ 13,125 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Earnings Per Share [Abstract] | ||||
Net income attributable to the Company | $ 1,117 | $ 10,367 | $ 11,956 | $ 23,868 |
Weighted average number of shares: | ||||
Weighted average number of shares used in calculating basic net income per share | 32,166 | 32,093 | 32,147 | 32,067 |
Effect of dilutive stock-based compensation plans: | ||||
Stock options | 34 | 38 | 35 | 39 |
Weighted average number of shares used in calculating diluted net income per share | 32,200 | 32,131 | 32,182 | 32,106 |
Average market price of common stock used for calculation of dilutive shares | $ 48.44 | $ 39.47 | $ 47.47 | $ 37.40 |
Net income per share: | ||||
Basic | 0.03 | 0.32 | 0.37 | 0.74 |
Diluted | $ 0.03 | $ 0.32 | $ 0.37 | $ 0.74 |
Noncontrolling Interest (Detail
Noncontrolling Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Noncontrolling Interest [Line Items] | ||||
Net income/(loss) of ASC | $ 1,233 | $ 10,101 | $ 12,207 | $ 23,417 |
Net income/(loss) of ASC available for common ownership | 1,117 | 10,367 | 11,956 | 23,868 |
Net income/(loss) attributable to noncontrolling interest | 116 | (266) | 251 | (451) |
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Noncontrolling interest, beginning of year | 3,767 | |||
Net (loss)/income attributable to noncontrolling interest | 116 | $ (266) | 251 | (451) |
Noncontrolling interest | $ 4,031 | 4,031 | ||
Albany Safran Composites, LLC [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Net income/(loss) of ASC | 3,029 | (4,033) | ||
Less: Return attributable to the Company's preferred holding | 515 | 480 | ||
Net income/(loss) of ASC available for common ownership | $ 2,514 | $ (4,513) | ||
Ownership percentage of noncontrolling shareholder | 10.00% | 10.00% | 10.00% | 10.00% |
Net income/(loss) attributable to noncontrolling interest | $ 251 | $ (451) | ||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Noncontrolling interest, beginning of year | 3,767 | 3,690 | ||
Net (loss)/income attributable to noncontrolling interest | 251 | (451) | ||
Changes in other comprehensive income attributable to noncontrolling interest | 13 | (1) | ||
Noncontrolling interest | $ 4,031 | $ 3,238 | $ 4,031 | $ 3,238 |
Accumulated Other Comprehensi56
Accumulated Other Comprehensive Income (AOCI) (Schedule of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning balance | $ 507,523 | |
Ending balance | 538,060 | |
Translation adjustments [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning balance | (133,298) | $ (108,655) |
Other comprehensive income/(loss) before reclassifications | 28,453 | 2,393 |
Pension/postretirement plan remeasurement | ||
Interest expense related to swaps reclassified to the Statement of Income, net of tax | ||
Pension and postretirement liability adjustments reclassified to Statement of Income, net of tax | ||
Net current period other comprehensive income | 28,453 | 2,393 |
Ending balance | (104,845) | (106,262) |
Pension and postretirement liability adjustments [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning balance | (51,719) | (48,725) |
Other comprehensive income/(loss) before reclassifications | (1,079) | 12 |
Pension/postretirement plan remeasurement | 105 | |
Interest expense related to swaps reclassified to the Statement of Income, net of tax | ||
Pension and postretirement liability adjustments reclassified to Statement of Income, net of tax | 332 | 244 |
Net current period other comprehensive income | (747) | 361 |
Ending balance | (52,466) | (48,364) |
Derivative valuation adjustment [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning balance | 828 | (1,464) |
Other comprehensive income/(loss) before reclassifications | (619) | (4,608) |
Pension/postretirement plan remeasurement | ||
Interest expense related to swaps reclassified to the Statement of Income, net of tax | 585 | 363 |
Pension and postretirement liability adjustments reclassified to Statement of Income, net of tax | ||
Net current period other comprehensive income | (34) | (4,245) |
Ending balance | 794 | (5,709) |
Total Other Comprehensive Income [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning balance | (184,189) | (158,844) |
Other comprehensive income/(loss) before reclassifications | 26,755 | (2,203) |
Pension/postretirement plan remeasurement | 105 | |
Interest expense related to swaps reclassified to the Statement of Income, net of tax | 585 | 363 |
Pension and postretirement liability adjustments reclassified to Statement of Income, net of tax | 332 | 244 |
Net current period other comprehensive income | 27,672 | (1,491) |
Ending balance | $ (156,517) | $ (160,335) |
Accumulated Other Comprehensi57
Accumulated Other Comprehensive Income (AOCI) (Schedule of Items Reclassified to Statement of Income) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Expense related to interest rate swaps included in Income | $ 4,625 | $ 4,238 | $ 9,060 | $ 6,602 | |
Total pretax amount reclassified | 3,012 | 16,183 | 20,536 | 36,542 | |
Income tax effect | 1,779 | 6,082 | 8,329 | 13,125 | |
Effect on net income due to items reclassified from Accumulated Other Comprehensive Income | (1,117) | (10,367) | (11,956) | (23,868) | |
Prior service credit | (1,113) | (1,112) | (2,226) | (2,225) | |
Net actuarial loss | 1,353 | 1,296 | 2,700 | 2,574 | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Pension and postretirement liability adjustments [Member] | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Total pretax amount reclassified | [1] | 240 | 184 | 474 | 349 |
Income tax effect | (72) | (56) | (142) | (105) | |
Effect on net income due to items reclassified from Accumulated Other Comprehensive Income | 168 | 128 | 332 | 244 | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Derivative valuation adjustment [Member] | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Expense related to interest rate swaps included in Income | [2] | 343 | 305 | 943 | 586 |
Income tax effect | (130) | (116) | (358) | (223) | |
Effect on net income due to items reclassified from Accumulated Other Comprehensive Income | $ 213 | $ 189 | $ 585 | $ 363 | |
[1] | These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note 4). | ||||
[2] | Included in Interest expense are payments related to the interest rate swap agreements and amortization of swap buyouts (see Note 15). |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | ||
Trade and other accounts receivable | $ 152,410 | $ 146,460 |
Bank promissory notes | 17,009 | 15,759 |
Revenue in excess of progress billings | 30,664 | 15,926 |
Allowance for doubtful accounts | (7,018) | (6,952) |
Total accounts receivable | 193,065 | 171,193 |
Contract receivable | $ 21,581 | $ 14,045 |
Interest rate | 2.00% |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 40,474 | $ 37,691 |
Work in process | 75,917 | 58,715 |
Finished goods | 35,143 | 37,500 |
Total inventories | $ 151,534 | $ 133,906 |
Goodwill and Other Intangible60
Goodwill and Other Intangible Assets (Schedule of Changes in Intangible Assets and Goodwill) (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2017 | Dec. 31, 2016 | |
Amortized intangible assets: | ||||
Gross carrying value | $ 71,901 | $ 71,901 | ||
Accumulated amortization | 8,985 | 5,447 | ||
Net carrying amount | $ 62,916 | $ 66,454 | 62,916 | 66,454 |
Beginning balance | 66,454 | |||
Amortization | (3,538) | |||
Currency Translation | ||||
Ending balance | 62,916 | 66,454 | ||
Goodwill | ||||
Beginning balance | 160,375 | |||
Amortization | ||||
Currency Translation | 3,953 | |||
Ending balance | 164,328 | 160,375 | ||
AEC Trade Names [Member] | ||||
Amortized intangible assets: | ||||
Gross carrying value | 43 | 43 | ||
Accumulated amortization | 25 | 23 | ||
Net carrying amount | 20 | 20 | 18 | 20 |
Beginning balance | 20 | |||
Amortization | (2) | |||
Currency Translation | ||||
Ending balance | $ 18 | $ 20 | ||
Goodwill | ||||
Amortization life in years | 15 years | 15 years | ||
AEC Technology [Member] | ||||
Amortized intangible assets: | ||||
Gross carrying value | 228 | 228 | ||
Accumulated amortization | 136 | 124 | ||
Net carrying amount | $ 104 | $ 104 | 92 | 104 |
Beginning balance | 104 | |||
Amortization | (12) | |||
Currency Translation | ||||
Ending balance | $ 92 | $ 104 | ||
Goodwill | ||||
Amortization life in years | 15 years | 15 years | ||
Customer Relationships [Member] | ||||
Amortized intangible assets: | ||||
Gross carrying value | 49,490 | 49,490 | ||
Accumulated amortization | 4,131 | 2,481 | ||
Net carrying amount | $ 45,359 | $ 47,009 | 45,359 | 47,009 |
Beginning balance | 47,009 | |||
Amortization | (1,650) | |||
Currency Translation | ||||
Ending balance | $ 45,359 | $ 47,009 | ||
Goodwill | ||||
Amortization life in years | 15 years | 15 years | ||
Customer Contracts [Member] | ||||
Amortized intangible assets: | ||||
Gross carrying value | 20,420 | 20,420 | ||
Accumulated amortization | 4,263 | 2,561 | ||
Net carrying amount | $ 16,157 | $ 17,859 | 16,157 | 17,859 |
Beginning balance | 17,859 | |||
Amortization | (1,702) | |||
Currency Translation | ||||
Ending balance | $ 16,157 | $ 17,859 | ||
Goodwill | ||||
Amortization life in years | 6 years | 6 years | ||
Other Intangible Assets [Member] | ||||
Amortized intangible assets: | ||||
Gross carrying value | 1,720 | 1,720 | ||
Accumulated amortization | 430 | 258 | ||
Net carrying amount | $ 1,290 | $ 1,462 | $ 1,290 | 1,462 |
Beginning balance | 1,462 | |||
Amortization | (172) | |||
Currency Translation | ||||
Ending balance | $ 1,290 | $ 1,462 | ||
Goodwill | ||||
Amortization life in years | 5 years | 5 years | ||
MC Goodwill [Member] | ||||
Goodwill | ||||
Gross carrying value | 64,645 | |||
Beginning balance | $ 64,645 | |||
Amortization | ||||
Currency Translation | 3,953 | |||
Ending balance | 68,598 | $ 64,645 | ||
AEC Goodwill [Member] | ||||
Goodwill | ||||
Gross carrying value | $ 95,730 | |||
Beginning balance | 95,730 | |||
Amortization | ||||
Currency Translation | ||||
Ending balance | $ 95,730 | $ 95,730 |
Goodwill and Other Intangible61
Goodwill and Other Intangible Assets (Schedule of Estimated Amortization Expense) (Details) $ in Thousands | Jun. 30, 2017USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2,017 | $ 7,076 |
2,018 | 7,076 |
2,019 | 7,076 |
2,020 | 7,076 |
2,021 | $ 6,796 |
Financial Instruments (Narrativ
Financial Instruments (Narrative) (Details) - USD ($) $ in Thousands | Mar. 16, 2016 | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 16, 2016 | May 09, 2016 | May 06, 2016 | Apr. 08, 2016 | Jun. 18, 2015 |
Debt Instrument [Line Items] | ||||||||
Maximum leverage ratio allowed | 3.50 | |||||||
Minimum interest coverage ratio required | 3 | |||||||
Leverage ratio | 2.55 | |||||||
Interest coverage ratio | 9.41 | |||||||
Credit Agreement [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 2.70% | 2.58% | ||||||
Amount of credit facility | $ 550,000 | $ 400,000 | ||||||
Amount of credit facility outstanding | $ 430,000 | |||||||
Additional amount that can be borrowed on facility | $ 120,000 | |||||||
LIBOR spread | 1.50% | |||||||
Credit Agreement [Member] | Minimum [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
LIBOR spread | 1.25% | |||||||
Credit Agreement [Member] | Maximum [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
LIBOR spread | 1.75% | |||||||
Private Placement, Notes [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 6.84% | |||||||
Maturity date | Oct. 25, 2017 | |||||||
Payment required on October 25, 2017 | $ 50,000 | |||||||
Fair value of long-term debt | $ 51,500 | |||||||
Interest Rate Current Swap [Member] | Credit Agreement [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Borrowings, revolving credit facility | $ 120,000 | |||||||
Notional amount | $ 300,000 | $ 300,000 | ||||||
Fixed interest rate in swap | 2.745% | 1.245% | ||||||
LIBOR rate | 1.18% | |||||||
Amount paid to terminate agreement | $ 5,200 | |||||||
AAC [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 5.00% | |||||||
Maturity date | Dec. 31, 2022 |
Financial Instruments (Schedule
Financial Instruments (Schedule of Long-Term Debt) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||
Long-term debt | $ 495,762 | $ 484,584 |
Less: current portion | (51,732) | (51,666) |
Long-term debt, net of current portion | $ 444,030 | 432,918 |
Various Notes and Mortgages [Member] | ||
Debt Instrument [Line Items] | ||
Maturity date range, end | Dec. 31, 2021 | |
Capital Lease Obligations [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 15,762 | 16,584 |
Maturity date range, end | Dec. 31, 2022 | |
Private Placement, Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 50,000 | 50,000 |
Interest rate | 6.84% | |
Maturity date range, end | Dec. 31, 2017 | |
Credit Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 430,000 | $ 418,000 |
Interest rate | 2.70% | 2.58% |
Financial Instruments (Schedu64
Financial Instruments (Schedule of future minimum annual lease payments) (Details) $ in Thousands | Jun. 30, 2017USD ($) |
Long-term Debt and Capital Lease Obligations [Abstract] | |
2,017 | $ 1,212 |
2,018 | 2,473 |
2,019 | 2,473 |
2,020 | 2,520 |
2,021 | 2,520 |
Thereafter | 7,373 |
Total minimum lease payments | 18,571 |
Less: Amount representing interest | (2,809) |
Present value of minimum lease payments | $ 15,762 |
Fair-Value Measurements (Narrat
Fair-Value Measurements (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Derivative [Line Items] | ||||
Interest expense | $ 4,625 | $ 4,238 | $ 9,060 | $ 6,602 |
Interest Rate Current Swap [Member] | ||||
Derivative [Line Items] | ||||
Interest expense | 500 | 600 | ||
Interest Rate Swap Buyouts [Member] | ||||
Derivative [Line Items] | ||||
Interest expense | $ 400 | $ 100 |
Fair-Value Measurements (Schedu
Fair-Value Measurements (Schedule of Fair Value of Financial Assets and Liabilities) (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | |||
Derivative asset: | |||||
Common stock of foreign public company, original cost | $ 500 | $ 500 | |||
Quoted Prices in Active Markets (Level 1) [Member] | Fair Value, Measurements, Recurring [Member] | |||||
Assets: | |||||
Cash equivalents | 11,742 | 8,468 | |||
Foreign currency options | 2 | ||||
Common stock of unaffiliated foreign public company | [1] | 838 | 762 | ||
Liabilities: | |||||
Interest rate swaps | |||||
Significant Other Observable Inputs (Level 2) [Member] | Fair Value, Measurements, Recurring [Member] | |||||
Assets: | |||||
Cash equivalents | |||||
Foreign currency options | |||||
Common stock of unaffiliated foreign public company | |||||
Liabilities: | |||||
Interest rate swaps | 5,307 | [2] | 5,784 | [3] | |
Interest Rate Current Swap [Member] | |||||
Derivative asset: | |||||
Liability for fixed rate leg | 13,800 | 15,600 | |||
Receivable for floating rate leg | $ 19,100 | $ 21,400 | |||
[1] | Original cost basis $0.5 million | ||||
[2] | Net of $19.1 million receivable floating leg and $13.8 million liability fixed leg | ||||
[3] | Net of $21.4 million receivable floating leg and $15.6 million liability fixed leg |
Fair-Value Measurements (Sche67
Fair-Value Measurements (Schedule of (Losses)/Gains on Changes in Fair Value of Derivative Instruments) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | ||||
(Losses)/gains recognized in income, net | $ (75) | $ 250 | $ 455 | $ (129) |
Contingencies (Narrative) (Deta
Contingencies (Narrative) (Details) - Asbestos Litigation [Member] $ in Thousands | Jun. 30, 2017USD ($)claims |
Loss Contingencies [Line Items] | |
Total resolved claims, by means of settlement or dismissal | claims | 37,528 |
Total cost of resolution | $ | $ 10,200 |
Resolution costs paid by insurance carrier | 100.00% |
Confirmed insurance coverage | $ | $ 140,000 |
Brandon Drying Fabrics, Inc. [Member] | |
Loss Contingencies [Line Items] | |
Total resolved claims, by means of settlement or dismissal | claims | 7,706 |
Resolution costs paid by insurance carrier | 100.00% |
Contingencies (Schedule of Chan
Contingencies (Schedule of Changes in Claims) (Details) - Asbestos Litigation [Member] $ in Thousands | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2017USD ($)claims | Dec. 31, 2016USD ($)claims | Dec. 31, 2015USD ($)claims | Dec. 31, 2014USD ($)claims | Dec. 31, 2013USD ($)claims | Dec. 31, 2012USD ($)claims | |
Loss Contingencies [Line Items] | ||||||
Opening Number of Claims | 3,745 | 3,791 | 3,821 | 4,299 | 4,463 | 4,446 |
Claims Dismissed, Settled, or Resolved | 39 | 148 | 116 | 625 | 230 | 90 |
New Claims | 31 | 102 | 86 | 147 | 66 | 107 |
Closing Number of Claims | 3,737 | 3,745 | 3,791 | 3,821 | 4,299 | 4,463 |
Amounts Paid (thousands) to Settle or Resolve ($) | $ | $ 10 | $ 758 | $ 164 | $ 437 | $ 78 | $ 530 |
Changes in Shareholders' Equi70
Changes in Shareholders' Equity (Schedule of Activity in Shareholders' Equity) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Balance | $ 511,290,000 | |||
Net income | $ 1,233,000 | $ 10,101,000 | 12,207,000 | $ 23,417,000 |
Compensation and benefits paid or payable in shares | 1,670,000 | |||
Options exercised | 175,000 | |||
Dividends declared | (10,936,000) | |||
Cumulative translation adjustments | 28,466,000 | |||
Pension and postretirement liability adjustments | (747,000) | |||
Derivative valuation adjustment | (34,000) | |||
Balance | 542,091,000 | 542,091,000 | ||
Common Stock [Member] | ||||
Balance | 40,000 | |||
Net income | ||||
Compensation and benefits paid or payable in shares | ||||
Options exercised | ||||
Dividends declared | ||||
Cumulative translation adjustments | ||||
Pension and postretirement liability adjustments | ||||
Derivative valuation adjustment | ||||
Balance | 40,000 | 40,000 | ||
Additional Paid-in Capital [Member] | ||||
Balance | 425,953,000 | |||
Net income | ||||
Compensation and benefits paid or payable in shares | 1,410,000 | |||
Options exercised | 175,000 | |||
Dividends declared | ||||
Cumulative translation adjustments | ||||
Pension and postretirement liability adjustments | ||||
Derivative valuation adjustment | ||||
Balance | 427,538,000 | 427,538,000 | ||
Retained Earnings [Member] | ||||
Balance | 522,855,000 | |||
Net income | 11,956,000 | |||
Compensation and benefits paid or payable in shares | ||||
Options exercised | ||||
Dividends declared | (10,936,000) | |||
Cumulative translation adjustments | ||||
Pension and postretirement liability adjustments | ||||
Derivative valuation adjustment | ||||
Balance | 523,875,000 | 523,875,000 | ||
Total Other Comprehensive Income [Member] | ||||
Balance | (184,189,000) | |||
Net income | ||||
Compensation and benefits paid or payable in shares | ||||
Options exercised | ||||
Dividends declared | ||||
Cumulative translation adjustments | 28,453,000 | |||
Pension and postretirement liability adjustments | (747,000) | |||
Derivative valuation adjustment | (34,000) | |||
Balance | (156,517,000) | (156,517,000) | ||
Treasury Stock [Member] | ||||
Balance | (257,136,000) | |||
Net income | ||||
Compensation and benefits paid or payable in shares | 260,000 | |||
Options exercised | ||||
Dividends declared | ||||
Cumulative translation adjustments | ||||
Pension and postretirement liability adjustments | ||||
Derivative valuation adjustment | ||||
Balance | (256,876,000) | (256,876,000) | ||
Noncontrolling Interest [Member] | ||||
Balance | 3,767,000 | |||
Net income | 251,000 | |||
Compensation and benefits paid or payable in shares | ||||
Options exercised | ||||
Dividends declared | ||||
Cumulative translation adjustments | 13,000 | |||
Pension and postretirement liability adjustments | ||||
Derivative valuation adjustment | ||||
Balance | $ 4,031,000 | $ 4,031,000 |
Recent Accounting Pronounceme71
Recent Accounting Pronouncements (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Recent Accounting Pronouncements Details | |
Change affecting cash payments of taxes in lieu of share issuance | $ 1,300 |
Change affecting classification of excess tax benefits | $ 100 |