Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Apr. 01, 2018 | Apr. 18, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | MINERALS TECHNOLOGIES INC | |
Entity Central Index Key | 891,014 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 35,364,149 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Apr. 1, 2018 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) [Abstract] | ||
Product sales | $ 412.2 | $ 386.3 |
Service revenue | 19.1 | 18.7 |
Total net sales | 431.3 | 405 |
Cost of goods sold | 305 | 279 |
Cost of service revenue | 12.8 | 12.3 |
Total cost of sales | 317.8 | 291.3 |
Production margin | 113.5 | 113.7 |
Marketing and administrative expenses | 44.4 | 44 |
Research and development expenses | 6.1 | 5.8 |
Acquisition related transaction and integration costs | 0.4 | 1.5 |
Restructuring and other items, net | 0 | 0.3 |
Income from operations | 62.6 | 62.1 |
Interest expense, net | (10.7) | (11.8) |
Debt modification costs and fees | 0 | (3.9) |
Other non-operating income (deductions), net | (2.7) | (0.9) |
Total non-operating deductions, net | (13.4) | (16.6) |
Income before provision for taxes and equity in earnings | 49.2 | 45.5 |
Provision for taxes on income | 9.3 | 10.1 |
Equity in earnings of affiliates, net of tax | 1.2 | 0.2 |
Consolidated net income | 41.1 | 35.6 |
Less: Net income attributable to non-controlling interests | 1.2 | 1 |
Net income attributable to Minerals Technologies Inc. (MTI) | $ 39.9 | $ 34.6 |
Earnings per share: | ||
Basic earnings per share attributable to MTI (in dollars per share) | $ 1.13 | $ 0.99 |
Diluted earnings per share attributable to MTI (in dollars per share) | 1.12 | 0.97 |
Cash dividends declared per common share (in dollars per share) | $ 0.05 | $ 0.05 |
Shares used in computation of earnings per share: | ||
Basic (in shares) | 35.4 | 35 |
Diluted (in shares) | 35.7 | 35.6 |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) [Abstract] | ||
Consolidated net income | $ 41.1 | $ 35.6 |
Other comprehensive income, net of tax: | ||
Foreign currency translation adjustments | 15.2 | 13 |
Pension and postretirement plan adjustments | 1.9 | 1.2 |
Unrealized gains on cash flow hedges | 1.6 | 0.1 |
Total other comprehensive income, net of tax | 18.7 | 14.3 |
Total comprehensive income including non-controlling interests | 59.8 | 49.9 |
Comprehensive income attributable to non-controlling interest | (1.8) | (1.5) |
Comprehensive income attributable to MTI | $ 58 | $ 48.4 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Apr. 01, 2018 | [1] | Dec. 31, 2017 | [2] |
Current assets: | ||||
Cash and cash equivalents | $ 223.2 | $ 212.2 | ||
Short-term investments, at cost which approximates market | 3.9 | 2.7 | ||
Accounts receivable, net | 398.6 | 383 | ||
Inventories | 221.2 | 219.3 | ||
Prepaid expenses and other current assets | 37.2 | 35 | ||
Total current assets | 884.1 | 852.2 | ||
Property, plant and equipment | 2,218.5 | 2,219.6 | ||
Less accumulated depreciation and depletion | (1,152.7) | (1,158.3) | ||
Property, plant and equipment, net | 1,065.8 | 1,061.3 | ||
Goodwill | 779.5 | 779.3 | ||
Intangible assets | 194.5 | 196.5 | ||
Deferred income taxes | 25.1 | 25.6 | ||
Other assets and deferred charges | 57.3 | 55.5 | ||
Total assets | 3,006.3 | 2,970.4 | ||
Current liabilities: | ||||
Short-term debt | 6.6 | 6.3 | ||
Current maturities of long-term debt | 3.8 | 3.8 | ||
Accounts payable | 177.3 | 179 | ||
Other current liabilities | 111.1 | 120.9 | ||
Total current liabilities | 298.8 | 310 | ||
Long-term debt, net of unamortized discount and deferred financing costs | 960.8 | 959.8 | ||
Deferred income taxes | 158.8 | 159.4 | ||
Accrued pension and post-retirement benefits | 151.1 | 155 | ||
Other non-current liabilities | 105 | 107.1 | ||
Total liabilities | 1,674.5 | 1,691.3 | ||
Shareholders' equity: | ||||
Common stock | 4.9 | 4.9 | ||
Additional paid-in capital | 423.2 | 422.7 | ||
Retained earnings | 1,645.3 | 1,607.2 | ||
Accumulated other comprehensive loss | (167.9) | (186.1) | ||
Less common stock held in treasury | (602.7) | (597) | ||
Total MTI shareholders' equity | 1,302.8 | 1,251.7 | ||
Non-controlling interest | 29 | 27.4 | ||
Total shareholders' equity | 1,331.8 | 1,279.1 | ||
Total liabilities and shareholders' equity | $ 3,006.3 | $ 2,970.4 | ||
[1] | Unaudited | |||
[2] | Condensed from audited financial statements |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 01, 2018 | Apr. 02, 2017 | ||
Operating Activities: | |||
Consolidated net income | $ 41.1 | $ 35.6 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation, depletion and amortization | 21.1 | 21.7 | |
Non-cash debt modification fees | 0 | 1.8 | |
Other non-cash items | (1.1) | 2.1 | |
Net changes in operating assets and liabilities | (25.4) | (45.3) | |
Net cash provided by operating activities | 35.7 | 15.9 | |
Investing Activities: | |||
Purchases of property, plant and equipment, net | (17.9) | (13.1) | |
Net purchases of short-term investments | (1.3) | (1.6) | |
Net cash used in investing activities | (19.2) | (14.7) | |
Financing Activities: | |||
Repayment of long-term debt | (0.4) | (22.3) | |
Net issuance (repayment) of short-term debt | 0 | (0.4) | |
Purchase of common shares for treasury | (5.7) | 0 | |
Proceeds from issuance of stock under option plan | 0.6 | 2.2 | |
Taxes paid on settlement of equity awards | (3.2) | (3.2) | |
Dividends paid to non-controlling interest | (0.1) | (0.2) | |
Cash dividends paid | (1.8) | (1.7) | |
Net cash used in financing activities | (10.6) | (25.6) | |
Effect of exchange rate changes on cash and cash equivalents | 5.1 | 4.4 | |
Net increase (decrease) in cash and cash equivalents | 11 | (20) | |
Cash and cash equivalents at beginning of period | 212.2 | [1] | 188.5 |
Cash and cash equivalents at end of period | 223.2 | [2] | 168.5 |
Supplemental disclosure of cash flow information: | |||
Interest paid | 8.9 | 11.3 | |
Income taxes paid | 4 | 4.8 | |
Non-cash financing activities: | |||
Treasury stock purchases settled after period end | $ 0.3 | $ 0 | |
[1] | Condensed from audited financial statements | ||
[2] | Unaudited |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Apr. 01, 2018 | |
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Note 1. Basis of Presentation and The accompanying unaudited condensed consolidated financial statements have been prepared by management of Minerals Technologies Inc. (the “Company”, “MTI”, “we”, or “us”) in accordance with the rules and regulations of the United States Securities and Exchange Commission. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted. Therefore, these financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. In the opinion of management, all adjustments, consisting solely of normal recurring adjustments necessary for a fair presentation of the financial information for the periods indicated, have been included. The results for the three-month period ended April 1, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. Certain reclassifications were made to prior year amounts to conform to current year presentation as a result of the adoption of ASU 2017-07. Company Operations The Company is a resource- and technology-based company that develops, produces and markets worldwide a broad range of specialty mineral, mineral-based and synthetic mineral products and supporting systems and services. The Company has 4 reportable segments: Performance Materials, Specialty Minerals, Refractories and Energy Services. - The Performance Materials segment is a leading global supplier of bentonite and bentonite-related products, chromite and leonardite. This segment also provides products for non-residential construction, environmental and infrastructure projects worldwide, serving customers engaged in a broad range of construction projects. - - The Refractories segment produces and markets monolithic and shaped refractory materials and specialty products, services and application and measurement equipment, and calcium metal and metallurgical wire products. - The Energy Services segment provides services to improve the production, costs, compliance, and environmental impact of activities performed in the oil and gas industry. The segment offers a range of patented and unpatented technologies, products and services to the upstream and downstream oil & gas sector throughout the world. Use of Estimates The Company employs accounting policies that are in accordance with U.S. generally accepted accounting principles and require management to make estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported period. Significant estimates include those related to revenue recognition, valuation of long-lived assets, goodwill and other intangible assets, income taxes, including valuation allowances, and pension plan assumptions. Actual results could differ from those estimates. Recently Issued Accounting Standards Changes to accounting principles generally accepted in the United States of America (U.S. GAAP) are established by the Financial Accounting Standards Board (FASB) in the form of accounting standards updates (ASUs) to the FASB’s Accounting Standards Codification. The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position and results of operations Leases In February 2016, the FASB issued ASU 2016-02, “Leases”, which requires lessees to recognize most leases on-balance sheet, thereby increasing their reported assets and liabilities, in some cases very significantly. Lessor accounting remains substantially similar to current U.S. GAAP. ASU 2016-02 is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2018. ASU 2016-02 mandates a modified retrospective transition method for all entities. The Company is currently evaluating the impact of this ASU on the Company’s consolidated financial statements and related disclosures. The Company has performed a high level analysis of its current lease portfolio and is in process of establishing a cross-functional project team to assist in the implementation of this ASU. Based on the current status of this assessment, the adoption of this guidance is not expected to have a material impact on the Company’s financial statements. Intangibles – Goodwill and Other In January 2017, the FASB issued ASU 2017-04, “Intangibles-Goodwill and Other: Simplifying the Test for Goodwill Impairment”, which no longer requires an entity to perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, goodwill will be measured using the difference between the carrying amount and the fair value of the reporting unit. The guidance is effective for the interim and annual periods beginning on or after December 15, 2019, with early adoption permitted. The adoption of this guidance is not expected to have a material impact on the Company’s financial statements. We are currently evaluating the timing of adoption of this standard. Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In February 2018, the FASB issued ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income”, which allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The guidance is effective for the interim and annual periods beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the timing of adoption of this standard. Adoption of New Accounting Standards On January 1, 2018, the Company adopted the provisions of ASU No. 2014-09, “Revenue from Contracts with Customers”. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. The guidance also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. The Company has elected to use the cumulative effect transition method and there has not been a change to our previously reported financial results. Under ASC 606, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration we expect to receive in exchange for those goods or services. We measure revenue based on the consideration specified in the customer arrangement and revenue is recognized when the performance obligations in the customer arrangement are satisfied. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as, the customer receives the benefit of the performance obligation. Customers typically receive the benefit as goods are delivered and services are performed. We utilized a comprehensive approach to assess the impact of the guidance on our contract portfolio by reviewing our current accounting policies and practices to identify potential differences that would result from applying the new requirements to our revenue contracts, including evaluation of our performance obligations, principal versus agent considerations and variable consideration. We completed our contract and business process reviews and implemented changes to our controls to support recognition and disclosures under the new guidance. We recognize revenue when our performance obligation is satisfied. See Note 2 to the Condensed Consolidated Financial Statements. On January 1, 2018, the Company adopted the provisions of ASU 2017-07, “Compensation – Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost”, which requires companies to present the service cost component of the net benefit cost in the same line items in which they report compensation cost. All other components of net periodic benefit cost will be presented outside operating income. The provisions have been applied retrospectively for the income statement presentation requirements. Prior to the adoption of the guidance, the Company classified all net periodic benefit costs within operating costs, primarily within “Marketing and administrative expenses” on the Condensed Consolidated Statement of Income. The line item classification changes required by the guidance did not impact the Company’s pre-tax earnings or net income; however, “Income from operations” and “Other non-operating income (deductions), net” changed by immaterial offsetting amounts. As a result of the accounting change, the Company reclassified approximately $0.4 million from marketing and administrative expenses to other deductions for the three months ended April 2, 2017 to conform to the current year presentation. On January 1, 2018, the Company early adopted the provisions of ASU 2017-12, “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities,” which improves and simplifies existing guidance to allow companies to better reflect their risk management activities in the financial statements. The guidance expands the ability to hedge nonfinancial and financial risk components, eliminates the requirement to separately measure and recognize hedge ineffectiveness and eases requirements of an entity’s assessment of hedge effectiveness. The adoption of this guidance did not have an impact on the Company’s financial statements. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 3 Months Ended |
Apr. 01, 2018 | |
Revenue from Contracts with Customers [Abstract] | |
Revenue from Contracts with Customers | Note 2. Revenue from Contracts with Customers The Company’s revenues are primarily derived from the sale of products. . In most of the Company’s PCC contracts, the price per ton is based upon the total number of tons sold to the customer during the year. Under these contracts, the price billed to the customer for shipments during the year is based on periodic estimates of the total annual volume that will be sold to such customer. Revenues are adjusted at the end of each year to reflect the actual volume sold. The Company also has consignment arrangements with certain customers in our Refractories segment. Revenues for these transactions are recorded when the consigned products are consumed by the customer and control is transferred to the customer. Revenue from sales of equipment, primarily in our Refractories segment, is recorded upon completion of installation and control is transferred to the customer. Revenue from services is recorded when the services have been performed. Revenue from long-term construction, primarily in our Energy Services segment, . The following table disaggregates our revenue by major source (product line) for the period ended April 1, 2018 and April 2, 2017: Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars) Net Sales Metalcasting $ 79.2 $ 66.6 Household, Personal Care and Specialty Products 48.7 41.1 Environmental Products 12.7 10.6 Building Materials 18.9 17.4 Basic Minerals 27.8 34.2 Performance Materials 187.3 169.9 Paper PCC 97.0 93.4 Specialty PCC 17.0 17.0 Talc 13.1 14.3 Ground Calcium Carbonate 22.5 21.5 Specialty Minerals 149.6 146.2 Refractory Products 62.3 56.7 Metallurgical Products 13.0 13.5 Refractories 75.3 70.2 Energy Services 19.1 18.7 Total $ 431.3 $ 405.0 |
Earnings Per Share (EPS)
Earnings Per Share (EPS) | 3 Months Ended |
Apr. 01, 2018 | |
Earnings Per Share (EPS) [Abstract] | |
Earnings Per Share (EPS) | Note 3. Earnings Per Share (EPS) Basic earnings per share are based upon the weighted average number of common shares outstanding during the period. Diluted earnings per share are based upon the weighted average number of common shares outstanding during the period assuming the issuance of common shares for all potentially dilutive common shares outstanding. The following table sets forth the computation of basic and diluted earnings per share: Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (in millions, except per share data) Net income attributable to MTI $ 39.9 $ 34.6 Weighted average shares outstanding 35.4 35.0 Dilutive effect of stock options and stock units 0.3 0.6 Weighted average shares outstanding, adjusted 35.7 35.6 Basic earnings per share attributable to MTI $ 1.13 $ 0.99 Diluted earnings per share attributable to MTI $ 1.12 $ 0.97 Options to purchase 362,443 shares and 185,104 shares of common stock for the three-month periods ended April 1, 2018 and April 2, 2017, respectively, were not included in the computation of diluted earnings per share because they were anti-dilutive, as the exercise prices of the options were greater than the average market price of the common shares. |
Restructuring and Other Items,
Restructuring and Other Items, net | 3 Months Ended |
Apr. 01, 2018 | |
Restructuring and Other Items, net [Abstract] | |
Restructuring and Other Items, net | Note 4. Restructuring and Other Items, net At April 1, 2018, the Company had $7.6 million included within accrued liabilities in the Condensed Consolidated Balance Sheet for cash expenditures needed to satisfy remaining obligations under workforce reduction initiatives. The Company expects to pay these amounts by the end of December 2018. The following table is a reconciliation of our restructuring liability balance as of April 1, 2018: (millions of dollars) Restructuring liability, December 31, 2017 $ 8.1 Additional provisions - Cash payments (0.5 ) Restructuring liability, April 1, 2018 $ 7.6 |
Income Taxes
Income Taxes | 3 Months Ended |
Apr. 01, 2018 | |
Income Taxes [Abstract] | |
Income Taxes | Note 5. Income Taxes During the fourth quarter of 2017, the U.S. Tax Cuts and Jobs Act (“U.S. Tax Reform”), was enacted in the United States. Amongst its many provisions, U.S. Tax Reform reduced the U.S. corporate income tax rate from 35% to 21%, effective January 1, 2018, and created a territorial tax system with a one-time mandatory tax on previously deferred foreign earnings of U.S. subsidiaries. As a result of the enactment of U.S. Tax Reform, we recognized a provisional net tax benefit of $47.3 million in the fourth quarter of 2017. We are applying the guidance in Staff Account Bulletin No. 118 (“SAB 118”), Income Tax Accounting Implications of the Tax Cuts and Jobs Act, issued by the Securities and Exchange Commission, when accounting for the enactment-date effects of U.S. Tax Reform. As permitted by SAB No. 118, some elements of the tax expense recorded in the fourth quarter of 2017 due to the enactment of U.S. Tax Reform were based on reasonable estimates and considered provisional. The Company is continuing to collect and analyze detailed information about the earnings and profits of its non-U.S. subsidiaries, the related taxes paid, the amounts which could be repatriated, the foreign taxes which may be incurred on repatriation and the associated impact of these items under U.S. Tax Reform. The Company may record adjustments to refine those estimates during the measurement period, as additional analysis is completed. See Note 5 to our consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 for further information on this provisional net tax benefit. during the three months ended April 1, 2018 U.S. Tax Reform also created a new requirement that certain income earned by foreign subsidiaries, known as global intangible low-tax income (“GILTI”), must be included in the gross income of their U.S. shareholder. The FASB allows an accounting policy election of either recognizing deferred taxes for temporary differences expected to reverse as GILTI in future years or recognizing such taxes as a current-period expense when incurred. Given the complexity of the GILTI provisions, we are still evaluating the effects of the GILTI provisions and have not yet determined our accounting policy. At April 1, 2018, because we are still evaluating the GILTI provisions and our analysis of future taxable income that is subject to GILTI, we have included GILTI related to current-year operations only in our estimated annual effective tax rate and have not provided additional GILTI on deferred items. The recorded impact of U.S. Tax Reform is provisional and the final amount may differ, possibly materially, due to, among other things, changes in estimates, interpretations and assumptions we made, changes in IRS interpretations, the issuances of new guidance, legislative actions, or related interpretations in response to U.S. Tax Reform and future actions by states within the United States that have not currently adopted U.S. Tax Reform. As of April 1, 2018, the Company had approximately $15.1 million of total unrecognized income tax benefits. Included in this amount were a total of $11.1 million of unrecognized income tax benefits that, if recognized, would affect the Company’s effective tax rate. While it is expected that the amount of unrecognized tax benefits will change in the next 12 months, the Company does not expect the change to have a significant impact on the results of operations or the financial position of the Company. The Company’s accounting policy is to recognize interest and penalties accrued relating to unrecognized income tax benefits as part of its provision for income taxes. The Company had a net increase of approximately $0.2 million during the three months ended April 1, 2018, and had an accrued balance of $1.8 million of interest and penalties as of April 1, 2018. The Company operates in multiple taxing jurisdictions, both within and outside the U.S. In certain situations, a taxing authority may challenge positions that the Company has adopted in its income tax filings. The Company, with a few exceptions (none of which are material), is no longer subject to income tax examinations by tax authorities for years prior to 2010. Provision for taxes was $9.3 million as compared to $10.1 million in the prior year. The effective tax rate was 19.0% as compared to 22.2% in the prior year. The lower effective tax rate was primarily due to U.S. Tax Reform. |
Inventories
Inventories | 3 Months Ended |
Apr. 01, 2018 | |
Inventories [Abstract] | |
Inventories | Note 6. Inventories The following is a summary of inventories by major category: Apr. 1, 2018 Dec. 31, 2017 (millions of dollars) Raw materials $ 84.1 $ 82.5 Work-in-process 7.8 7.9 Finished goods 89.5 92.3 Packaging and supplies 39.8 36.6 Total inventories $ 221.2 $ 219.3 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Apr. 01, 2018 | |
Goodwill and Other Intangible Assets [Abstract] | |
Goodwill and Other Intangible Assets | Note 7. Goodwill and Other Intangible Assets Goodwill and other intangible assets with indefinite lives are not amortized, but instead are assessed for impairment, at least annually. The carrying amount of goodwill was $779.5 million and $779.3 as of April 1, 2018 and December 31, 2017. Intangible assets subject to amortization as of April 1, 2018 and December 31, 2017 were as follows: Weighted Average Useful Life (Years) Apr. 1, 2018 Dec. 31, 2017 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization (millions of dollars) Tradenames 34 $ 199.8 $ 22.1 $ 199.8 $ 20.7 Technology 12 18.8 5.2 18.8 4.8 Patents and trademarks 17 6.4 5.3 6.4 5.3 Customer relationships 30 4.5 2.4 4.5 2.2 28 $ 229.5 $ 35.0 $ 229.5 $ 33.0 The weighted average amortization period for acquired intangible assets subject to amortization is approximately 28 years. Estimated amortization expense is $5.9 million for the remainder of 2018, $31.6 million for 2019-2022, and $157.0 million thereafter. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Apr. 01, 2018 | |
Derivative Financial Instruments [Abstract] | |
Derivative Financial Instruments | Note 8. Derivative Financial Instruments As a multinational corporation with operations throughout the world, the Company is exposed to certain market risks. The Company uses a variety of practices to manage these market risks, including, when considered appropriate, derivative financial instruments. The Company’s objective is to offset gains and losses resulting from interest rates and foreign currency exposures with gains and losses on the derivative contracts used to hedge them. The Company uses derivative financial instruments only for risk management and not for trading or speculative purposes. By using derivative financial instruments to hedge exposures to changes in interest rates and foreign currencies, the Company exposes itself to credit risk and market risk. Credit risk is the risk that the counterparty will fail to perform under the terms of the derivative contract. When the fair value of a derivative contract is positive, the counterparty owes the Company, which creates credit risk for the Company. When the fair value of a derivative contract is negative, the Company owes the counterparty, and therefore, it does not face any credit risk. The Company minimizes the credit risk in derivative instruments by entering into transactions with major financial institutions. Market risk is the adverse effect on the value of a financial instrument that results from a change in interest rates, currency exchange rates, or commodity prices. The market risk associated with interest rate and forward exchange contracts is managed by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken. Cash flow hedges: For derivative instruments that are designated and qualify as cash flow hedges, the Company records the effective portion of the gain or loss in accumulated other comprehensive income (loss) as a separate component of shareholders’ equity. The Company subsequently reclassifies the effective portion of gain or loss into earnings in the period during which the hedged transaction is recognized in earnings. The Company utilizes over-the-counter interest rate swaps to limit exposure to market fluctuations on floating-rate debt. During the second quarter of 2016, the Company entered into a floating to fixed interest rate swap for an initial aggregate notional amount of $300 million. The notional amount at April 1, 2018 was $186 million. This interest rate swap is designated as a cash flow hedge. The gains and losses associated with this interest rate swap are recorded in accumulated other comprehensive income (loss). The fair value of this swap was an asset of $4.1 million at April 1, 2018 and recorded to other non-current assets on the Condensed Consolidated Balance Sheet. Assets and liabilities measured at fair value are based on one or more of three valuation techniques. The three valuation techniques are as follows: • Market approach - prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. • Cost approach - amount that would be required to replace the service capacity of an asset or replacement cost. • Income approach - techniques to convert future amounts to a single present amount based on market expectations, including present value techniques, option-pricing and other models. The Company primarily applies the income approach for interest rate derivatives for recurring fair value measurements and attempts to utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value of our interest rate swap contract is determined based on inputs that are readily available in public markets or can be derived from information available in publicly quoted markets and are categorized as Level 2. |
Long-Term Debt and Commitments
Long-Term Debt and Commitments | 3 Months Ended |
Apr. 01, 2018 | |
Long-Term Debt and Commitments [Abstract] | |
Long-Term Debt and Commitments | Note 9. Long-Term Debt and Commitments The following is a summary of long-term debt: Apr. 1, 2018 Dec. 31, 2017 (millions of dollars) Term Loan Facility-Variable Tranche due February 14, 2024, net of unamortized discount and deferred financing costs of $21.9 million and $22.7 million $ 656.1 $ 655.3 Term Loan Facility- Fixed Tranche due May 9, 2021, net of unamortized discount of $0.4 million and $0.5 million 299.6 299.5 Japan Loan Facilities 5.8 5.6 China Loan Facilities 3.1 3.2 Total $ 964.6 $ 963.6 Less: Current maturities 3.8 3.8 Long-term debt $ 960.8 $ 959.8 On May 9, 2014, in connection with the acquisition of AMCOL International Corporation (“AMCOL”), the Company entered into a credit agreement providing for a $1,560 million senior secured term loan facility (the “Term Facility”) and a $200 million senior secured revolving credit facility (the “Revolving Facility” and, together with the Term Facility, the “Facilities”). On June 23, 2015, the Company entered into an amendment (the “First Amendment”) to the credit agreement to reprice the $1.378 billion then outstanding on the Term Facility. As amended, the Term Facility had a $1.078 billion floating rate tranche and a $300 million fixed rate tranche. On February 14, 2017, the Company entered into an amendment (the “Second Amendment”) to the credit agreement to reprice the $788 million floating rate tranche then outstanding, which extended the maturity and lowered the interest costs by 75 basis points. Following the Second Amendment, the loans outstanding under the floating rate tranche of the Term Facility will mature on February 14, 2024, the loans outstanding under the fixed rate tranche of the Term Facility will mature on May 9, 2021 and the loans outstanding (if any) and commitments under the Revolving Facility will mature and terminate, as the case may be, on May 9, 2019. After the Second Amendment, loans under the floating rate tranche of the Term Facility bear interest at a rate equal to an adjusted LIBOR rate (subject to a floor of 0.75%) plus an applicable margin equal to 2.25% per annum. Loans under the fixed rate tranche of the Term Facility bear interest at a rate of 4.75%. Loans under the Revolving Facility will bear interest at a rate equal to an adjusted LIBOR rate plus an applicable margin equal to 1.75% per annum. Such rates are subject to decrease by up to 25 basis points in the event that, and for so long as, the Company’s net leverage ratio (as defined in the credit agreement) is less than certain thresholds. The floating rate tranche of the Term Facility was issued at par and the fixed rate tranche of the Term Facility was issued at a 0.25% discount in connection with the First Amendment. The variable rate tranche of the Term Facility was issued at a 0.25% discount in connection with the Second Amendment. The variable rate tranche has a 1% required amortization per year. The Company will pay certain fees under the credit agreement, including customary annual administration fees. The loans under the fixed rate tranche of the Term Facility are subject to prepayment premiums in the event of certain prepayments prior to the third anniversary of the effective date of the First Amendment. The obligations of the Company under the Facilities are unconditionally guaranteed jointly and severally by, subject to certain exceptions, all material domestic subsidiaries of the Company (the “Guarantors”) and secured, subject to certain exceptions, by a security interest in substantially all of the assets of the Company and the Guarantors. On April 18, 2018, the Company entered into an amendment (the “Third Amendment”) to the credit agreement to refinance the Revolving Facility. See Note 16. The credit agreement contains certain customary affirmative and negative covenants that limit or restrict the ability of the Company and its restricted subsidiaries to enter into certain transactions or take certain actions. In addition, the credit agreement contains a financial covenant that requires the Company, if on the last day of any fiscal quarter loans or letters of credit were outstanding under the Revolving Facility (excluding up to $15 million of letters of credit), to maintain a maximum net leverage ratio (as defined in the credit agreement) of, initially, 5.25 to 1.00 for the four fiscal quarters preceding such day. Such maximum net leverage ratio requirement is subject to decrease during the duration of the facility to a minimum level (when applicable) of 3.50 to 1.00. As of April 1, 2018, there were no loans and $5.7 million in letters of credit outstanding under the Revolving Facility. The Company is in compliance with all the covenants associated with the Revolving Facility as of the end of the period covered by this report. The Company has committed loan facilities for the funding of new manufacturing facilities in China. In addition, the Company has a committed loan facility in Japan. As of April 1, 2018, on a combined basis, $8.9 million was outstanding under these loan facilities. Principal will be repaid in accordance with the payment schedules ending in 2021. The Company repaid $0.4 million on these loans during the first quarter of 2018. As of April 1, 2018, the Company had $38.4 million in uncommitted short-term bank credit lines, of which approximately $6.6 million was in use. |
Benefit Plans
Benefit Plans | 3 Months Ended |
Apr. 01, 2018 | |
Benefit Plans [Abstract] | |
Benefit Plans | Note 10. Benefit Plans The Company and its subsidiaries have pension plans covering the majority of eligible employees on a contributory or non-contributory basis. The Company also provides postretirement health care and life insurance benefits for the majority of its U.S. retired employees. Disclosures for the U.S. plans have been combined with those outside of the U.S. as the international plans do not have significantly different assumptions, and together represent less than 25% of our total benefit obligation. Components of Net Periodic Benefit Cost Pension Benefits Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars Service cost $ 2.0 $ 2.1 Interest cost 3.0 3.1 Expected return on plan assets (4.8 ) (4.5 ) Amortization: Prior service cost 0.2 0.5 Recognized net actuarial loss 2.7 2.1 Net periodic benefit cost $ 3.1 $ 3.3 Other Benefits Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars Service cost $ 0.1 $ 0.1 Interest cost 0.1 0.1 Amortization: Prior service cost (0.3 ) (0.8 ) Recognized net actuarial (gain)/loss (0.2 ) (0.1 ) Net periodic benefit cost $ (0.3 ) $ (0.7 ) Amortization amounts of prior service costs and recognized net actuarial losses are recorded, net of tax, as increases to accumulated other comprehensive income. The Company expects to contribute approximately $15.0 million to its pension plans and $0.5 million to its other postretirement benefit plans in 2018. As of April 1, 2018, $3.9 million has been contributed to the pension plans. On January 1, 2018, the Company retrospectively adopted the provisions of ASU 2017-07, “Compensation – Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost”. Under the new guidance, the Company classifies all net periodic benefit costs within the “Other non-operating income (deductions), net” line item on the consolidated statement of income. The line item classification changes required by the guidance did not impact the Company’s pre-tax earnings or net income; however, “Income from operations” and “Other non-operating income (deductions), net” changed by immaterial offsetting amounts. |
Comprehensive Income
Comprehensive Income | 3 Months Ended |
Apr. 01, 2018 | |
Comprehensive Income [Abstract] | |
Comprehensive Income | Note 11. Comprehensive Income The following table summarizes the amounts reclassified out of accumulated other comprehensive loss attributable to the Company: Amounts Reclassified Out of Accumulated Other Comprehensive Loss Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars) Amortization of pension items: Pre-tax amount $ 2.4 $ 1.7 Tax (0.5 ) (0.5 ) Net of tax $ 1.9 $ 1.2 The pre-tax amounts in the table above are included within the components of net periodic pension benefit cost (see Note 10 to the Condensed Consolidated Financial Statements) and the tax amounts are included within the provision for taxes on income line within the Condensed Consolidated Statements of Income. The major components of accumulated other comprehensive loss, net of related tax, attributable to MTI are as follows: Foreign Currency Translation Adjustment Unrecognized Pension Costs Net Gain on Cash Flow Hedges Total (millions of dollars) Balance as of December 31, 2017 $ (104.1 ) $ (86.5 ) $ 4.5 $ (186.1 ) Other comprehensive income before reclassifications 14.7 - 1.6 16.3 Amounts reclassified from AOCI - 1.9 - 1.9 Net current period other comprehensive income 14.7 1.9 1.6 18.2 Balance as of April 1, 2018 $ (89.4 ) $ (84.6 ) $ 6.1 $ (167.9 ) |
Accounting for Asset Retirement
Accounting for Asset Retirement Obligations | 3 Months Ended |
Apr. 01, 2018 | |
Accounting for Asset Retirement Obligations [Abstract] | |
Accounting for Asset Retirement Obligations | Note 12. Accounting for Asset Retirement Obligations The Company records asset retirement obligations for situations in which the Company will be required to incur costs to retire tangible long-lived assets. The fair value of the liability for an asset retirement obligation is recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The Company also records liabilities related to land reclamation as a part of asset retirement obligations. The Company mines various minerals using a surface mining process that requires the removal of overburden. In certain areas and under various governmental regulations, the Company is obligated to restore the land comprising each mining site to its original condition at the completion of the mining activity. The obligation is adjusted to reflect the passage of time, mining activities, and changes in estimated future cash outflows. The following is a reconciliation of asset retirement obligations as of April 1, 2018: (millions of dollars) Asset retirement liability, December 31, 2017 $ 22.1 Accretion expense 0.1 Other (1.1 ) Payments (0.6 ) Foreign currency translation 0.1 Asset retirement liability, April 1, 2018 $ 20.6 The asset retirement costs are capitalized as part of the carrying amount of the associated asset. The current portion of the liability of approximately $0.3 million is included in other current liabilities and the long-term portion of the liability of approximately $20.3 million is included in other non-current liabilities in the Condensed Consolidated Balance Sheet as of April 1, 2018. |
Contingencies
Contingencies | 3 Months Ended |
Apr. 01, 2018 | |
Contingencies [Abstract] | |
Contingencies | Note 13. Contingencies The Company is party to a number of lawsuits arising in the normal course of our business. On May 8, 2013, Armada (Singapore) PTE Limited, an ocean shipping company now in bankruptcy (“Armada”) filed a case in federal court in the Northern District of Illinois against AMCOL and certain of its subsidiaries ( Armada (Singapore) PTE Limited v. AMCOL International Corp., et al., United States District Court for the Northern District of Illinois , Case No. 13 CV 3455). We acquired AMCOL and its subsidiaries on May 9, 2014. A co-defendant is Ashapura Minechem Limited, a company located in Mumbai, India (“AML”). During the relevant time period, 2008-2010, AMCOL owned slightly over 20% of the outstanding AML stock through December 2009, after which it owned approximately 19%. In 2008, AML entered into two contracts of affreightment (“COA”) with Armada for over 60 ship loads of bauxite from India to China. After one shipment, AML made no further shipments, which led Armada to file arbitrations in London against AML, one for each COA. AML did not appear in the London arbitrations and default awards of approximately $70 million were entered. The litigation filed by Armada against AMCOL and AML relates to these awards, which AML has not paid. The substance of the allegations by Armada is that AML and AMCOL engaged in illegal conduct to thwart Armada’s efforts to collect the arbitration award. AMCOL won a motion for judgement on the pleadings that resulted in the successful dismissal of all but one count in the complaint, including a dismissal of all counts alleging violations of Illinois’ Fraudulent Transfer laws and federal RICO violations. On March 26, 2018, the U.S. Court of Appeals for the Seventh Circuit affirmed the district court’s dismissal of such counts. The Company does not expect that the outcome of the one remaining count of the Armada lawsuit will have a material effect on our financial position, results of operations or cash flows. Certain of the Company’s subsidiaries are among numerous defendants in a number of cases seeking damages for exposure to silica or to asbestos containing materials. The Company currently has three pending silica cases and 22 pending asbestos cases. To date, 1,493 silica cases and 54 asbestos cases have been dismissed, not including any lawsuits against AMCOL or American Colloid Company dismissed prior to our acquisition of AMCOL. Three new asbestos cases were filed during the first quarter of 2018, including one new case naming AMCOL as a defendant. One asbestos case was dismissed during the first quarter. No silica cases were dismissed during the period. Most of these claims do not provide adequate information to assess their merits, the likelihood that the Company will be found liable, or the magnitude of such liability, if any. Additional claims of this nature may be made against the Company or its subsidiaries. At this time management anticipates that the amount of the Company’s liability, if any, and the cost of defending such claims, will not have a material effect on its financial position or results of operations. The Company has settled only one silica lawsuit, for a nominal amount, and no asbestos lawsuits to date (not including any that may have been settled by AMCOL prior to completion of the acquisition). We are unable to state an amount or range of amounts claimed in any of the lawsuits because state court pleading practices do not require identifying the amount of the claimed damage. The aggregate cost to the Company for the legal defense of these cases since inception continues to be insignificant. The majority of the costs of defense for these cases, excluding cases against AMCOL, are reimbursed by Pfizer Inc. pursuant to the terms of certain agreements entered into in connection with the Company’s initial public offering in 1992. The Company is entitled to indemnification, pursuant to agreement, for sales prior to the initial public offering. Of the 22 pending asbestos cases, 14 of the non-AMCOL cases are subject to indemnification, in whole or in part, because the plaintiffs claim liability based on sales of products that occurred either entirely before the initial public offering, or both before and after the initial public offering. In the six remaining non-AMCOL cases, the plaintiffs have not alleged dates of exposure. The remaining cases involve AMCOL only, so no Pfizer indemnity is available. Our experience has been that the Company is not liable to plaintiffs in any of these lawsuits and the Company does not expect to pay any settlements or jury verdicts in these lawsuits. Environmental Matters On April 9, 2003, the Connecticut Department of Environmental Protection issued an administrative consent order relating to our Canaan, Connecticut, plant where both our Refractories segment and Specialty Minerals segment have operations. We agreed to the order, which includes provisions requiring investigation and remediation of contamination associated with historic use of polychlorinated biphenyls (“PCBs”) and mercury at a portion of the site. We have completed the required investigations and submitted several reports characterizing the contamination and assessing site-specific risks. We are awaiting regulators’ approval of the risk assessment report, which will form the basis for a proposal by the Company concerning eventual remediation. We believe that the most likely form of overall site remediation will be to leave the existing contamination in place (with some limited soil removal), encapsulate it, and monitor the effectiveness of the encapsulation. We anticipate that a substantial portion of the remediation cost will be borne by the United States based on its involvement at the site from 1942 – 1964, as historic documentation indicates that PCBs and mercury were first used at the facility at a time of U.S. government ownership for production of materials needed by the military. Pursuant to a Consent Decree entered on October 24, 2014, the United States paid the Company $2.3 million in the 4th quarter of 2014 to resolve the Company’s claim for response costs for investigation and initial remediation activities at this facility through October 24, 2014. Contribution by the United States to any future costs of investigation or additional remediation has, by agreement, been left unresolved. Though the cost of the likely remediation remains uncertain pending completion of the phased remediation decision process, we have estimated that the Company’s share of the cost of the encapsulation and limited soil removal described above would approximate $0.4 million, which has been accrued as of April 1, 2018. The Company is evaluating options for upgrading the wastewater treatment facilities at its Adams, Massachusetts plant. This work has been undertaken pursuant to an administrative Consent Order originally issued by the Massachusetts Department of Environmental Protection (“DEP”) on June 18, 2002. This order was amended on June 1, 2009 and on June 2, 2010. The amended Order includes the investigation by January 1, 2022 of options for ensuring that the facility’s wastewater treatment ponds will not result in unpermitted discharge to groundwater. Additional requirements of the amendment include the submittal by July 1, 2022 of a plan for closure of a historic lime solids disposal area. Preliminary engineering reviews completed in 2005 indicate that the estimated cost of wastewater treatment upgrades to operate this facility beyond 2024 may be between $6 million and $8 million. The Company estimates that the remaining remediation costs would approximate $0.4 million, which has been accrued as of April 1, 2018. The Company and its subsidiaries are not party to any other material pending legal proceedings, other than routine litigation incidental to their businesses. |
Non-controlling interests
Non-controlling interests | 3 Months Ended |
Apr. 01, 2018 | |
Non-controlling interests [Abstract] | |
Non-controlling interests | Note 14. Non-controlling interests The following is a reconciliation of beginning and ending total equity, equity attributable to MTI, and equity attributable to non-controlling interests: Equity Attributable to MTI Total Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Non-controlling Interests (millions of dollars) Balance as of December 31, 2017 $ 4.9 $ 422.7 $ 1,607.2 $ (186.1 ) $ (597.0 ) $ 27.4 $ 1,279.1 Net income - - 39.9 - - 1.2 41.1 Other comprehensive income - - - 18.2 - 0.5 18.7 Dividends declared - - (1.8 ) - - - (1.8 ) Dividends to non-controlling interest - - - - - (0.2 ) (0.2 ) Issuance of shares pursuant to employee stock compensation plans - 0.5 - - - - 0.5 Stock based compensation - - - - - - - Purchase of treasury stock - - - - (5.7 ) - (5.7 ) Balance as of April 1, 2018 $ 4.9 $ 423.2 $ 1,645.3 $ (167.9 ) $ (602.7 ) $ 29.0 $ 1,331.8 The income attributable to non-controlling interests for the three-month periods ended April 1, 2018 and April 2, 2017 was from continuing operations. The remainder of income was attributable to MTI. |
Segment and Related Information
Segment and Related Information | 3 Months Ended |
Apr. 01, 2018 | |
Segment and Related Information [Abstract] | |
Segment and Related Information | Note 15. Segment and Related Information On a regular basis, the Company reviews its segments and the approach used by the chief operating decision maker to assess performance and allocate resources. The Company has 4 reportable segments: Specialty Minerals, Performance Materials, Refractories and Energy Services. Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars) Net Sales Performance Materials $ 187.3 $ 169.9 Specialty Minerals 149.6 146.2 Refractories 75.3 70.2 Energy Services 19.1 18.7 Total $ 431.3 $ 405.0 Income from Operations Performance Materials $ 26.2 $ 28.8 Specialty Minerals 24.1 24.4 Refractories 12.8 9.2 Energy Services 1.5 1.7 Total $ 64.6 $ 64.1 A reconciliation of the totals reported for the operating segments to the applicable line items in the condensed consolidated financial statements is as follows: Income from operations before provision for taxes on income Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars) Income from operations for reportable segments $ 64.6 $ 64.1 Acquisition related transaction and integration costs (0.4 ) (1.5 ) Unallocated corporate expenses (1.6 ) (0.5 ) Consolidated income from operations 62.6 62.1 Non-operating deductions, net (13.4 ) (16.6 ) Income from continuing operations before provision for taxes on income $ 49.2 $ 45.5 The Company’s sales by product category are as follows: Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars) Paper PCC $ 97.0 $ 93.4 Specialty PCC 17.0 17.0 Talc 13.1 14.3 Ground Calcium Carbonate 22.5 21.5 Metalcasting 79.2 66.6 Household, Personal Care and Specialty Products 48.7 41.1 Environmental Products 12.7 10.6 Building Materials 18.9 17.4 Basic Minerals 27.8 34.2 Refractory Products 62.3 56.7 Metallurgical Products 13.0 13.5 Energy Services 19.1 18.7 Total $ 431.3 $ 405.0 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Apr. 01, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 16. Subsequent Events On April 30, 2018, the Company completed the acquisition of Sivomatic Holding, B.V. (“Sivomatic”), a leading European supplier of premium pet litter products. Sivomatic is a vertically integrated manufacturer, with production facilities in the Netherlands, Austria and Turkey. With a leading position in premier clumping products, their product portfolio spans the range of pet litter derived from bentonite, sourced predominantly from wholly-owned mines in Turkey. Sivomatic has approximately 115 employees and generated revenue of €73 million in 2017. The acquisition was financed through a combination of cash on hand and the Company’s credit facilities. On April 18, 2018, the Company entered into an amendment (the “Third Amendment”) to the credit agreement to refinance its $200 million Revolving Facility. As amended, the Revolving Facility has been increased to $300 million in aggregate commitments, maturing on April 18, 2023. Loans under the Revolving Facility will bear interest at a rate equal to an adjusted LIBOR rate plus an applicable margin equal to 1.625% per annum, subject to decrease by up to 25 basis points in the event that, and for as long as, the Company’s net leverage ratio (as defined in the credit agreement) is less than certain thresholds. |
Basis of Presentation and Sum22
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Apr. 01, 2018 | |
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The Company employs accounting policies that are in accordance with U.S. generally accepted accounting principles and require management to make estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported period. Significant estimates include those related to revenue recognition, valuation of long-lived assets, goodwill and other intangible assets, income taxes, including valuation allowances, and pension plan assumptions. Actual results could differ from those estimates. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards Changes to accounting principles generally accepted in the United States of America (U.S. GAAP) are established by the Financial Accounting Standards Board (FASB) in the form of accounting standards updates (ASUs) to the FASB’s Accounting Standards Codification. The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position and results of operations Leases In February 2016, the FASB issued ASU 2016-02, “Leases”, which requires lessees to recognize most leases on-balance sheet, thereby increasing their reported assets and liabilities, in some cases very significantly. Lessor accounting remains substantially similar to current U.S. GAAP. ASU 2016-02 is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2018. ASU 2016-02 mandates a modified retrospective transition method for all entities. The Company is currently evaluating the impact of this ASU on the Company’s consolidated financial statements and related disclosures. The Company has performed a high level analysis of its current lease portfolio and is in process of establishing a cross-functional project team to assist in the implementation of this ASU. Based on the current status of this assessment, the adoption of this guidance is not expected to have a material impact on the Company’s financial statements. Intangibles – Goodwill and Other In January 2017, the FASB issued ASU 2017-04, “Intangibles-Goodwill and Other: Simplifying the Test for Goodwill Impairment”, which no longer requires an entity to perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, goodwill will be measured using the difference between the carrying amount and the fair value of the reporting unit. The guidance is effective for the interim and annual periods beginning on or after December 15, 2019, with early adoption permitted. The adoption of this guidance is not expected to have a material impact on the Company’s financial statements. We are currently evaluating the timing of adoption of this standard. Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In February 2018, the FASB issued ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income”, which allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The guidance is effective for the interim and annual periods beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the timing of adoption of this standard. Adoption of New Accounting Standards On January 1, 2018, the Company adopted the provisions of ASU No. 2014-09, “Revenue from Contracts with Customers”. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. The guidance also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. The Company has elected to use the cumulative effect transition method and there has not been a change to our previously reported financial results. Under ASC 606, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration we expect to receive in exchange for those goods or services. We measure revenue based on the consideration specified in the customer arrangement and revenue is recognized when the performance obligations in the customer arrangement are satisfied. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as, the customer receives the benefit of the performance obligation. Customers typically receive the benefit as goods are delivered and services are performed. We utilized a comprehensive approach to assess the impact of the guidance on our contract portfolio by reviewing our current accounting policies and practices to identify potential differences that would result from applying the new requirements to our revenue contracts, including evaluation of our performance obligations, principal versus agent considerations and variable consideration. We completed our contract and business process reviews and implemented changes to our controls to support recognition and disclosures under the new guidance. We recognize revenue when our performance obligation is satisfied. See Note 2 to the Condensed Consolidated Financial Statements. On January 1, 2018, the Company adopted the provisions of ASU 2017-07, “Compensation – Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost”, which requires companies to present the service cost component of the net benefit cost in the same line items in which they report compensation cost. All other components of net periodic benefit cost will be presented outside operating income. The provisions have been applied retrospectively for the income statement presentation requirements. Prior to the adoption of the guidance, the Company classified all net periodic benefit costs within operating costs, primarily within “Marketing and administrative expenses” on the Condensed Consolidated Statement of Income. The line item classification changes required by the guidance did not impact the Company’s pre-tax earnings or net income; however, “Income from operations” and “Other non-operating income (deductions), net” changed by immaterial offsetting amounts. As a result of the accounting change, the Company reclassified approximately $0.4 million from marketing and administrative expenses to other deductions for the three months ended April 2, 2017 to conform to the current year presentation. On January 1, 2018, the Company early adopted the provisions of ASU 2017-12, “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities,” which improves and simplifies existing guidance to allow companies to better reflect their risk management activities in the financial statements. The guidance expands the ability to hedge nonfinancial and financial risk components, eliminates the requirement to separately measure and recognize hedge ineffectiveness and eases requirements of an entity’s assessment of hedge effectiveness. The adoption of this guidance did not have an impact on the Company’s financial statements. |
Revenue from Contracts with C23
Revenue from Contracts with Customers (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Revenue from Contracts with Customers [Abstract] | |
Disaggregation of Revenue | The following table disaggregates our revenue by major source (product line) for the period ended April 1, 2018 and April 2, 2017: Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars) Net Sales Metalcasting $ 79.2 $ 66.6 Household, Personal Care and Specialty Products 48.7 41.1 Environmental Products 12.7 10.6 Building Materials 18.9 17.4 Basic Minerals 27.8 34.2 Performance Materials 187.3 169.9 Paper PCC 97.0 93.4 Specialty PCC 17.0 17.0 Talc 13.1 14.3 Ground Calcium Carbonate 22.5 21.5 Specialty Minerals 149.6 146.2 Refractory Products 62.3 56.7 Metallurgical Products 13.0 13.5 Refractories 75.3 70.2 Energy Services 19.1 18.7 Total $ 431.3 $ 405.0 |
Earnings Per Share (EPS) (Table
Earnings Per Share (EPS) (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Earnings Per Share (EPS) [Abstract] | |
Computation of basic and diluted earnings per share | The following table sets forth the computation of basic and diluted earnings per share: Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (in millions, except per share data) Net income attributable to MTI $ 39.9 $ 34.6 Weighted average shares outstanding 35.4 35.0 Dilutive effect of stock options and stock units 0.3 0.6 Weighted average shares outstanding, adjusted 35.7 35.6 Basic earnings per share attributable to MTI $ 1.13 $ 0.99 Diluted earnings per share attributable to MTI $ 1.12 $ 0.97 |
Restructuring and Other Items25
Restructuring and Other Items, net (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Restructuring and Other Items, net [Abstract] | |
Reconciliation of restructuring liability | The following table is a reconciliation of our restructuring liability balance as of April 1, 2018: (millions of dollars) Restructuring liability, December 31, 2017 $ 8.1 Additional provisions - Cash payments (0.5 ) Restructuring liability, April 1, 2018 $ 7.6 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Inventories [Abstract] | |
Inventories by major category | The following is a summary of inventories by major category: Apr. 1, 2018 Dec. 31, 2017 (millions of dollars) Raw materials $ 84.1 $ 82.5 Work-in-process 7.8 7.9 Finished goods 89.5 92.3 Packaging and supplies 39.8 36.6 Total inventories $ 221.2 $ 219.3 |
Goodwill and Other Intangible27
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Goodwill and Other Intangible Assets [Abstract] | |
Acquired intangible assets subject to amortization | Intangible assets subject to amortization as of April 1, 2018 and December 31, 2017 were as follows: Weighted Average Useful Life (Years) Apr. 1, 2018 Dec. 31, 2017 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization (millions of dollars) Tradenames 34 $ 199.8 $ 22.1 $ 199.8 $ 20.7 Technology 12 18.8 5.2 18.8 4.8 Patents and trademarks 17 6.4 5.3 6.4 5.3 Customer relationships 30 4.5 2.4 4.5 2.2 28 $ 229.5 $ 35.0 $ 229.5 $ 33.0 |
Long-Term Debt and Commitments
Long-Term Debt and Commitments (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Long-Term Debt and Commitments [Abstract] | |
Summary of long term debt | The following is a summary of long-term debt: Apr. 1, 2018 Dec. 31, 2017 (millions of dollars) Term Loan Facility-Variable Tranche due February 14, 2024, net of unamortized discount and deferred financing costs of $21.9 million and $22.7 million $ 656.1 $ 655.3 Term Loan Facility- Fixed Tranche due May 9, 2021, net of unamortized discount of $0.4 million and $0.5 million 299.6 299.5 Japan Loan Facilities 5.8 5.6 China Loan Facilities 3.1 3.2 Total $ 964.6 $ 963.6 Less: Current maturities 3.8 3.8 Long-term debt $ 960.8 $ 959.8 |
Benefit Plans (Tables)
Benefit Plans (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Benefit Plans [Abstract] | |
Components of net periodic benefit cost | Components of Net Periodic Benefit Cost Pension Benefits Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars Service cost $ 2.0 $ 2.1 Interest cost 3.0 3.1 Expected return on plan assets (4.8 ) (4.5 ) Amortization: Prior service cost 0.2 0.5 Recognized net actuarial loss 2.7 2.1 Net periodic benefit cost $ 3.1 $ 3.3 Other Benefits Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars Service cost $ 0.1 $ 0.1 Interest cost 0.1 0.1 Amortization: Prior service cost (0.3 ) (0.8 ) Recognized net actuarial (gain)/loss (0.2 ) (0.1 ) Net periodic benefit cost $ (0.3 ) $ (0.7 ) |
Comprehensive Income (Tables)
Comprehensive Income (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Comprehensive Income [Abstract] | |
Reclassifications out of accumulated other comprehensive loss, net of related tax | The following table summarizes the amounts reclassified out of accumulated other comprehensive loss attributable to the Company: Amounts Reclassified Out of Accumulated Other Comprehensive Loss Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars) Amortization of pension items: Pre-tax amount $ 2.4 $ 1.7 Tax (0.5 ) (0.5 ) Net of tax $ 1.9 $ 1.2 |
Accumulated other comprehensive income (loss), net of related tax, attributable to MTI | The major components of accumulated other comprehensive loss, net of related tax, attributable to MTI are as follows: Foreign Currency Translation Adjustment Unrecognized Pension Costs Net Gain on Cash Flow Hedges Total (millions of dollars) Balance as of December 31, 2017 $ (104.1 ) $ (86.5 ) $ 4.5 $ (186.1 ) Other comprehensive income before reclassifications 14.7 - 1.6 16.3 Amounts reclassified from AOCI - 1.9 - 1.9 Net current period other comprehensive income 14.7 1.9 1.6 18.2 Balance as of April 1, 2018 $ (89.4 ) $ (84.6 ) $ 6.1 $ (167.9 ) |
Accounting for Asset Retireme31
Accounting for Asset Retirement Obligations (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Accounting for Asset Retirement Obligations [Abstract] | |
Reconciliation of asset retirement obligations | The following is a reconciliation of asset retirement obligations as of April 1, 2018: (millions of dollars) Asset retirement liability, December 31, 2017 $ 22.1 Accretion expense 0.1 Other (1.1 ) Payments (0.6 ) Foreign currency translation 0.1 Asset retirement liability, April 1, 2018 $ 20.6 |
Non-controlling interests (Tabl
Non-controlling interests (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Non-controlling interests [Abstract] | |
Total equity, equity attributable to MTI, and equity attributable to noncontrolling interests | The following is a reconciliation of beginning and ending total equity, equity attributable to MTI, and equity attributable to non-controlling interests: Equity Attributable to MTI Total Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Non-controlling Interests (millions of dollars) Balance as of December 31, 2017 $ 4.9 $ 422.7 $ 1,607.2 $ (186.1 ) $ (597.0 ) $ 27.4 $ 1,279.1 Net income - - 39.9 - - 1.2 41.1 Other comprehensive income - - - 18.2 - 0.5 18.7 Dividends declared - - (1.8 ) - - - (1.8 ) Dividends to non-controlling interest - - - - - (0.2 ) (0.2 ) Issuance of shares pursuant to employee stock compensation plans - 0.5 - - - - 0.5 Stock based compensation - - - - - - - Purchase of treasury stock - - - - (5.7 ) - (5.7 ) Balance as of April 1, 2018 $ 4.9 $ 423.2 $ 1,645.3 $ (167.9 ) $ (602.7 ) $ 29.0 $ 1,331.8 |
Segment and Related Informati33
Segment and Related Information (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Segment and Related Information [Abstract] | |
Segment information | Segment information for the three-month periods ended April 1, 2018 and April 2, 2017 is as follows: Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars) Net Sales Performance Materials $ 187.3 $ 169.9 Specialty Minerals 149.6 146.2 Refractories 75.3 70.2 Energy Services 19.1 18.7 Total $ 431.3 $ 405.0 Income from Operations Performance Materials $ 26.2 $ 28.8 Specialty Minerals 24.1 24.4 Refractories 12.8 9.2 Energy Services 1.5 1.7 Total $ 64.6 $ 64.1 |
Reconciliation of income from operations before provision for taxes on income | A reconciliation of the totals reported for the operating segments to the applicable line items in the condensed consolidated financial statements is as follows: Income from operations before provision for taxes on income Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars) Income from operations for reportable segments $ 64.6 $ 64.1 Acquisition related transaction and integration costs (0.4 ) (1.5 ) Unallocated corporate expenses (1.6 ) (0.5 ) Consolidated income from operations 62.6 62.1 Non-operating deductions, net (13.4 ) (16.6 ) Income from continuing operations before provision for taxes on income $ 49.2 $ 45.5 |
Sales by product category | The Company’s sales by product category are as follows: Three Months Ended Apr. 1, 2018 Apr. 2, 2017 (millions of dollars) Paper PCC $ 97.0 $ 93.4 Specialty PCC 17.0 17.0 Talc 13.1 14.3 Ground Calcium Carbonate 22.5 21.5 Metalcasting 79.2 66.6 Household, Personal Care and Specialty Products 48.7 41.1 Environmental Products 12.7 10.6 Building Materials 18.9 17.4 Basic Minerals 27.8 34.2 Refractory Products 62.3 56.7 Metallurgical Products 13.0 13.5 Energy Services 19.1 18.7 Total $ 431.3 $ 405.0 |
Basis of Presentation and Sum34
Basis of Presentation and Summary of Significant Accounting Policies (Details) $ in Millions | 3 Months Ended | |
Apr. 01, 2018USD ($)Segment | Apr. 02, 2017USD ($) | |
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | ||
Number of reportable segments | Segment | 4 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Marketing and administrative expenses | $ 44.4 | $ 44 |
Other deductions | $ (2.7) | (0.9) |
Accounting Standards Update 2017-07 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Marketing and administrative expenses | (0.4) | |
Other deductions | $ (0.4) |
Revenue from Contracts with C35
Revenue from Contracts with Customers (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 431.3 | $ 405 |
Metalcasting [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 79.2 | 66.6 |
Household, Personal Care & Specialty Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 48.7 | 41.1 |
Environmental Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 12.7 | 10.6 |
Building Materials [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 18.9 | 17.4 |
Basic Minerals [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 27.8 | 34.2 |
Paper PCC [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 97 | 93.4 |
Specialty PCC [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 17 | 17 |
Talc [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 13.1 | 14.3 |
Ground Calcium Carbonate [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 22.5 | 21.5 |
Refractory Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 62.3 | 56.7 |
Metallurgical Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 13 | 13.5 |
Performance Materials [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 187.3 | 169.9 |
Performance Materials [Member] | Metalcasting [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 79.2 | 66.6 |
Performance Materials [Member] | Household, Personal Care & Specialty Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 48.7 | 41.1 |
Performance Materials [Member] | Environmental Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 12.7 | 10.6 |
Performance Materials [Member] | Building Materials [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 18.9 | 17.4 |
Performance Materials [Member] | Basic Minerals [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 27.8 | 34.2 |
Specialty Minerals [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 149.6 | 146.2 |
Specialty Minerals [Member] | Paper PCC [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 97 | 93.4 |
Specialty Minerals [Member] | Specialty PCC [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 17 | 17 |
Specialty Minerals [Member] | Talc [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 13.1 | 14.3 |
Specialty Minerals [Member] | Ground Calcium Carbonate [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 22.5 | 21.5 |
Refractories [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 75.3 | 70.2 |
Refractories [Member] | Refractory Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 62.3 | 56.7 |
Refractories [Member] | Metallurgical Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 13 | 13.5 |
Energy Services [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 19.1 | $ 18.7 |
Earnings Per Share (EPS) (Detai
Earnings Per Share (EPS) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Earnings Per Share (EPS) [Abstract] | ||
Net income attributable to MTI | $ 39.9 | $ 34.6 |
Weighted average shares outstanding (in shares) | 35,400,000 | 35,000,000 |
Dilutive effect of stock options and stock units (in shares) | 300,000 | 600,000 |
Weighted average shares outstanding, adjusted (in shares) | 35,700,000 | 35,600,000 |
Basic earnings per share attributable to MTI (in dollars per share) | $ 1.13 | $ 0.99 |
Diluted earnings per share attributable to MTI (in dollars per share) | $ 1.12 | $ 0.97 |
Stock Options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities not included in the weighted average commons shares outstanding calculation (in shares) | 362,443 | 185,104 |
Restructuring and Other Items37
Restructuring and Other Items, net (Details) $ in Millions | 3 Months Ended |
Apr. 01, 2018USD ($) | |
Restructuring Reserve [Roll Forward] | |
Restructuring liability, beginning of period | $ 8.1 |
Additional provisions | 0 |
Cash payments | (0.5) |
Restructuring liability, ending of period | $ 7.6 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Apr. 01, 2018 | Dec. 31, 2017 | Apr. 02, 2017 | Dec. 31, 2017 | |
Income Taxes [Abstract] | ||||
U.S. corporate income tax rate | 21.00% | 35.00% | ||
Provisional income tax benefit | $ (47.3) | |||
Amount of unrecognized tax benefits | $ 15.1 | |||
Unrecognized tax benefits that would impact effective tax rate | 11.1 | |||
Unrecognized tax benefits, net increase (decrease) in penalties and interest expenses | 0.2 | |||
Unrecognized tax benefits, accrued interest and penalties | 1.8 | |||
Provision for taxes on income | $ 9.3 | $ 10.1 | $ 10.1 | |
Effective income tax rate | 19.00% | 22.20% |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Apr. 01, 2018 | Dec. 31, 2017 | ||
Inventories [Abstract] | ||||
Raw materials | $ 84.1 | $ 82.5 | ||
Work-in-process | 7.8 | 7.9 | ||
Finished goods | 89.5 | 92.3 | ||
Packaging and supplies | 39.8 | 36.6 | ||
Total inventories | $ 221.2 | [1] | $ 219.3 | [2] |
[1] | Unaudited | |||
[2] | Condensed from audited financial statements |
Goodwill and Other Intangible40
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Apr. 01, 2018 | Dec. 31, 2017 | |||
Goodwill and Other Intangible Assets [Abstract] | ||||
Goodwill | $ 779.5 | [1] | $ 779.3 | [2] |
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average useful life | 28 years | |||
Gross carrying amount | $ 229.5 | 229.5 | ||
Accumulated amortization | $ 35 | 33 | ||
Tradenames [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average useful life | 34 years | |||
Gross carrying amount | $ 199.8 | 199.8 | ||
Accumulated amortization | $ 22.1 | 20.7 | ||
Technology [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average useful life | 12 years | |||
Gross carrying amount | $ 18.8 | 18.8 | ||
Accumulated amortization | $ 5.2 | 4.8 | ||
Patents and Trademarks [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average useful life | 17 years | |||
Gross carrying amount | $ 6.4 | 6.4 | ||
Accumulated amortization | $ 5.3 | 5.3 | ||
Customer Relationships [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average useful life | 30 years | |||
Gross carrying amount | $ 4.5 | 4.5 | ||
Accumulated amortization | $ 2.4 | $ 2.2 | ||
[1] | Unaudited | |||
[2] | Condensed from audited financial statements |
Goodwill and Other Intangible41
Goodwill and Other Intangible Assets, Acquired Intangible Assets (Details) - Acquired Finite-Lived Intangible Assets [Member] $ in Millions | 3 Months Ended |
Apr. 01, 2018USD ($) | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted average amortization period for intangible assets subject to amortization | 28 years |
Estimated amortization expense, 2018 Remainder | $ 5.9 |
Estimated amortization expense, 2019 | 31.6 |
Estimated amortization expense, 2020 | 31.6 |
Estimated amortization expense, 2021 | 31.6 |
Estimated amortization expense, 2022 | 31.6 |
Estimated amortization expense, thereafter | $ 157 |
Derivative Financial Instrume42
Derivative Financial Instruments (Details) - Cash Flow Hedges [Member] - Interest Rate Swaps [Member] - USD ($) $ in Millions | Apr. 01, 2018 | Jul. 03, 2016 |
Other Non-current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative assets | $ 4.1 | |
Designated [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount | $ 186 | $ 300 |
Long-Term Debt and Commitment43
Long-Term Debt and Commitments (Details) - USD ($) $ in Millions | Feb. 14, 2017 | Apr. 01, 2018 | Apr. 02, 2017 | Dec. 31, 2017 | Jun. 23, 2015 | May 09, 2014 | ||
Debt Instrument [Line Items] | ||||||||
Debt | $ 964.6 | $ 963.6 | ||||||
Less: Current maturities | 3.8 | [1] | 3.8 | [2] | ||||
Long-term debt | 960.8 | [1] | 959.8 | [2] | ||||
Maximum borrowing capacity | 38.4 | |||||||
Repayments of long-term debt | 0.4 | $ 22.3 | ||||||
Uncommitted short-term bank credit lines, amount outstanding | $ 6.6 | |||||||
Minimum [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Net leverage ratio | 3.50 | |||||||
Maximum [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Net leverage ratio | 5.25 | |||||||
Term Loan Facility, Due February 14, 2024 [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt | $ 656.1 | 655.3 | ||||||
Long-term debt, unamortized discount and deferred financing costs | $ 21.9 | 22.7 | ||||||
Maturity date | Feb. 14, 2024 | |||||||
Term Loan Facility, Due February 14, 2024 [Member] | Floating Rate Tranche [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Amortization rate on notes | 1.00% | |||||||
Term Loan Facility Due May 9, 2021 [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt | $ 299.6 | 299.5 | ||||||
Long-term debt, unamortized discount and deferred financing costs | $ 0.4 | 0.5 | ||||||
Maturity date | May 9, 2021 | |||||||
Maximum borrowing capacity | $ 1,560 | |||||||
Term Loan Facility First Amendment [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit outstanding | $ 1,378 | |||||||
Term Loan Facility First Amendment [Member] | Floating Rate Tranche [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit outstanding | 1,078 | |||||||
Term Loan Facility First Amendment [Member] | Fixed Rate Tranche [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit outstanding | $ 300 | |||||||
Facility variable interest rate | 0.25% | |||||||
Term Loan Facility Second Amendment [Member] | LIBOR [Member] | Minimum [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Facility variable interest rate | 0.75% | |||||||
Term Loan Facility Second Amendment [Member] | LIBOR [Member] | Maximum [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Facility variable interest rate | 2.25% | |||||||
Term Loan Facility Second Amendment [Member] | Floating Rate Tranche [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit outstanding | $ 788 | |||||||
Facility variable interest rate | 0.25% | |||||||
Basis points related to debt | 0.75% | |||||||
Term Loan Facility Second Amendment [Member] | Fixed Rate Tranche [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Facility variable interest rate | 4.75% | |||||||
Japan Loan Facilities [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt | $ 5.8 | 5.6 | ||||||
China Loan Facilities [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt | $ 3.1 | $ 3.2 | ||||||
Combined Loan Facility of China and Japan [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Maturity date | Dec. 31, 2021 | |||||||
Debt instrument outstanding | $ 8.9 | |||||||
Repayments of long-term debt | $ 0.4 | |||||||
Revolving Credit Facility [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Maturity date | May 9, 2019 | |||||||
Maximum borrowing capacity | $ 200 | |||||||
Debt instrument outstanding | $ 0 | |||||||
Basis points related to debt | 0.25% | |||||||
Letters of credit outstanding | $ 5.7 | |||||||
Revolving Credit Facility [Member] | LIBOR [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Facility variable interest rate | 1.75% | |||||||
Letter of Credit [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Letters of credit outstanding | $ 15 | |||||||
[1] | Unaudited | |||||||
[2] | Condensed from audited financial statements |
Benefit Plans (Details)
Benefit Plans (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Benefit Plans [Abstract] | ||
Maximum percentage of total benefit obligation for international pension plans | 25.00% | |
Pension Benefits [Member] | ||
Components of net periodic benefit cost [Abstract] | ||
Service cost | $ 2 | $ 2.1 |
Interest cost | 3 | 3.1 |
Expected return on plan assets | (4.8) | (4.5) |
Amortization [Abstract] | ||
Prior service cost | 0.2 | 0.5 |
Recognized net actuarial (gain)/loss | 2.7 | 2.1 |
Net periodic benefit cost | 3.1 | 3.3 |
Employer Contributions [Abstract] | ||
Expected company contribution to its benefit plans | 15 | |
Company contribution to benefit plans | 3.9 | |
Other Benefits [Member] | ||
Components of net periodic benefit cost [Abstract] | ||
Service cost | 0.1 | 0.1 |
Interest cost | 0.1 | 0.1 |
Amortization [Abstract] | ||
Prior service cost | (0.3) | (0.8) |
Recognized net actuarial (gain)/loss | (0.2) | (0.1) |
Net periodic benefit cost | (0.3) | $ (0.7) |
Employer Contributions [Abstract] | ||
Expected company contribution to its benefit plans | $ 0.5 |
Comprehensive Income, Reclassif
Comprehensive Income, Reclassification Out of Accumulated Other Comprehensive Income (Loss) (Details) - Pension Costs [Member] - Reclassification out of Accumulated Other Comprehensive Loss [Member] - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Pre-tax amount | $ 2.4 | $ 1.7 |
Tax | (0.5) | (0.5) |
Net of tax | $ 1.9 | $ 1.2 |
Comprehensive Income, Accumulat
Comprehensive Income, Accumulated Other Comprehensive Income (Loss), Net of Related Tax (Details) $ in Millions | 3 Months Ended | |
Apr. 01, 2018USD ($) | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance at beginning of period | $ 1,251.7 | [1] |
Other comprehensive income before reclassifications | 16.3 | |
Amounts reclassified from AOCI | 1.9 | |
Net current period other comprehensive income | 18.2 | |
Balance at end of period | 1,302.8 | [2] |
AOCI Attributable to Parent [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance at beginning of period | (186.1) | |
Balance at end of period | (167.9) | |
Foreign Currency Translation Adjustment [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance at beginning of period | (104.1) | |
Other comprehensive income before reclassifications | 14.7 | |
Amounts reclassified from AOCI | 0 | |
Net current period other comprehensive income | 14.7 | |
Balance at end of period | (89.4) | |
Unrecognized Pension Costs [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance at beginning of period | (86.5) | |
Other comprehensive income before reclassifications | 0 | |
Amounts reclassified from AOCI | 1.9 | |
Net current period other comprehensive income | 1.9 | |
Balance at end of period | (84.6) | |
Net Gain on Cash Flow Hedges [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance at beginning of period | 4.5 | |
Other comprehensive income before reclassifications | 1.6 | |
Amounts reclassified from AOCI | 0 | |
Net current period other comprehensive income | 1.6 | |
Balance at end of period | $ 6.1 | |
[1] | Condensed from audited financial statements | |
[2] | Unaudited |
Accounting for Asset Retireme47
Accounting for Asset Retirement Obligations (Details) $ in Millions | 3 Months Ended |
Apr. 01, 2018USD ($) | |
Asset retirement obligation [Roll Forward] | |
Asset retirement liability, beginning of period | $ 22.1 |
Accretion expense | 0.1 |
Other | (1.1) |
Payments | (0.6) |
Foreign currency translation | 0.1 |
Asset retirement liability, ending of period | 20.6 |
Asset retirement obligation current portion | 0.3 |
Asset retirement obligation noncurrent portion | $ 20.3 |
Contingencies (Details)
Contingencies (Details) $ in Millions | 3 Months Ended | ||
Apr. 01, 2018USD ($)ContractLoadCase | Oct. 24, 2014USD ($) | Dec. 31, 2009 | |
Loss Contingencies [Line Items] | |||
Number of contracts entered | Contract | 2 | ||
Number of ship loads | Load | 60 | ||
Default arbitration award | $ | $ 70 | ||
Site Contingency [Line Items] | |||
Consent decree paid by US government | $ | $ 2.3 | ||
AMCOL International Corporation [Member] | |||
Loss Contingencies [Line Items] | |||
Ownership interest | 19.00% | 20.00% | |
Number of new cases filed during the period | 1 | ||
Silica Cases [Member] | |||
Loss Contingencies [Line Items] | |||
Number of pending cases | 3 | ||
Cumulative number of cases dismissed | 1,493 | ||
Number of cases dismissed | 0 | ||
Number of lawsuits settled | 1 | ||
Asbestos Cases [Member] | |||
Loss Contingencies [Line Items] | |||
Number of pending cases | 22 | ||
Cumulative number of cases dismissed | 54 | ||
Number of cases dismissed | 1 | ||
Number of new cases filed during the period | 3 | ||
Number of lawsuits settled | 0 | ||
Number of cases claim liability | 14 | ||
Number of allege liability | 6 | ||
Number of cases with no alleged exposure | 0 | ||
Administrative Consent Order for Contamination Associated with Historic Use of PCBs [Member] | |||
Site Contingency [Line Items] | |||
Location of plant | Canaan, Connecticut | ||
Estimated accrued remediation cost | $ | $ 0.4 | ||
Administrative Consent Order for Installation of Groundwater Contamination System [Member] | |||
Site Contingency [Line Items] | |||
Location of plant | Adams, Massachusetts plant | ||
Estimated accrued remediation cost | $ | $ 0.4 | ||
Estimated cost of wastewater treatment upgrades, lower range | $ | 6 | ||
Estimated cost of wastewater treatment upgrades, upper range | $ | $ 8 |
Non-controlling interests (Deta
Non-controlling interests (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 01, 2018 | Apr. 02, 2017 | ||
Noncontrolling Interest [Line Items] | |||
Balance | [1] | $ 1,279.1 | |
Net income | 41.1 | $ 35.6 | |
Other comprehensive income | 18.7 | $ 14.3 | |
Dividends declared | (1.8) | ||
Dividends to non-controlling interest | (0.2) | ||
Issuance of shares pursuant to employee stock compensation plans | 0.5 | ||
Stock based compensation | 0 | ||
Purchase of treasury stock | (5.7) | ||
Balance | [2] | 1,331.8 | |
Common Stock [Member] | |||
Noncontrolling Interest [Line Items] | |||
Balance | 4.9 | ||
Net income | 0 | ||
Other comprehensive income | 0 | ||
Dividends declared | 0 | ||
Dividends to non-controlling interest | 0 | ||
Issuance of shares pursuant to employee stock compensation plans | 0 | ||
Stock based compensation | 0 | ||
Purchase of treasury stock | 0 | ||
Balance | 4.9 | ||
Additional Paid-in Capital [Member] | |||
Noncontrolling Interest [Line Items] | |||
Balance | 422.7 | ||
Net income | 0 | ||
Other comprehensive income | 0 | ||
Dividends declared | 0 | ||
Dividends to non-controlling interest | 0 | ||
Issuance of shares pursuant to employee stock compensation plans | 0.5 | ||
Stock based compensation | 0 | ||
Purchase of treasury stock | 0 | ||
Balance | 423.2 | ||
Retained Earnings [Member] | |||
Noncontrolling Interest [Line Items] | |||
Balance | 1,607.2 | ||
Net income | 39.9 | ||
Other comprehensive income | 0 | ||
Dividends declared | (1.8) | ||
Dividends to non-controlling interest | 0 | ||
Issuance of shares pursuant to employee stock compensation plans | 0 | ||
Stock based compensation | 0 | ||
Purchase of treasury stock | 0 | ||
Balance | 1,645.3 | ||
Accumulated Other Comprehensive Income (Loss) [Member] | |||
Noncontrolling Interest [Line Items] | |||
Balance | (186.1) | ||
Net income | 0 | ||
Other comprehensive income | 18.2 | ||
Dividends declared | 0 | ||
Dividends to non-controlling interest | 0 | ||
Issuance of shares pursuant to employee stock compensation plans | 0 | ||
Stock based compensation | 0 | ||
Purchase of treasury stock | 0 | ||
Balance | (167.9) | ||
Treasury Stock [Member] | |||
Noncontrolling Interest [Line Items] | |||
Balance | (597) | ||
Net income | 0 | ||
Other comprehensive income | 0 | ||
Dividends declared | 0 | ||
Dividends to non-controlling interest | 0 | ||
Issuance of shares pursuant to employee stock compensation plans | 0 | ||
Stock based compensation | 0 | ||
Purchase of treasury stock | (5.7) | ||
Balance | (602.7) | ||
Non-controlling Interests [Member] | |||
Noncontrolling Interest [Line Items] | |||
Balance | 27.4 | ||
Net income | 1.2 | ||
Other comprehensive income | 0.5 | ||
Dividends declared | 0 | ||
Dividends to non-controlling interest | (0.2) | ||
Issuance of shares pursuant to employee stock compensation plans | 0 | ||
Stock based compensation | 0 | ||
Purchase of treasury stock | 0 | ||
Balance | $ 29 | ||
[1] | Condensed from audited financial statements | ||
[2] | Unaudited |
Segment and Related Informati50
Segment and Related Information (Details) $ in Millions | 3 Months Ended | |
Apr. 01, 2018USD ($)Segment | Apr. 02, 2017USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | Segment | 4 | |
Net Sales | $ 431.3 | $ 405 |
Income from Operations | 62.6 | 62.1 |
Performance Materials [Member] | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 187.3 | 169.9 |
Specialty Minerals [Member] | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 149.6 | 146.2 |
Refractories [Member] | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 75.3 | 70.2 |
Energy Services [Member] | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 19.1 | 18.7 |
Reportable Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 431.3 | 405 |
Income from Operations | 64.6 | 64.1 |
Reportable Segments [Member] | Performance Materials [Member] | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 187.3 | 169.9 |
Income from Operations | 26.2 | 28.8 |
Reportable Segments [Member] | Specialty Minerals [Member] | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 149.6 | 146.2 |
Income from Operations | 24.1 | 24.4 |
Reportable Segments [Member] | Refractories [Member] | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 75.3 | 70.2 |
Income from Operations | 12.8 | 9.2 |
Reportable Segments [Member] | Energy Services [Member] | ||
Segment Reporting Information [Line Items] | ||
Net Sales | 19.1 | 18.7 |
Income from Operations | $ 1.5 | $ 1.7 |
Segment and Related Informati51
Segment and Related Information, Reconciliation of Operating Income Before Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Income from operations before provision (benefit) for taxes on income [Abstract] | ||
Acquisition related transaction and integration costs | $ (0.4) | $ (1.5) |
Unallocated corporate expenses | (1.6) | (0.5) |
Consolidated income from operations | 62.6 | 62.1 |
Non-operating deductions, net | (13.4) | (16.6) |
Income before provision for taxes and equity in earnings | 49.2 | 45.5 |
Reportable Segments [Member] | ||
Income from operations before provision (benefit) for taxes on income [Abstract] | ||
Consolidated income from operations | $ 64.6 | $ 64.1 |
Segment and Related Informati52
Segment and Related Information, Sales By Product Category (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Revenue from External Customer [Line Items] | ||
Net Sales | $ 431.3 | $ 405 |
Paper PCC [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | 97 | 93.4 |
Specialty PCC [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | 17 | 17 |
Talc [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | 13.1 | 14.3 |
Ground Calcium Carbonate [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | 22.5 | 21.5 |
Metalcasting [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | 79.2 | 66.6 |
Household, Personal Care and Specialty Products [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | 48.7 | 41.1 |
Environmental Products [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | 12.7 | 10.6 |
Building Materials [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | 18.9 | 17.4 |
Basic Minerals [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | 27.8 | 34.2 |
Refractory Products [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | 62.3 | 56.7 |
Metallurgical Products [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | 13 | 13.5 |
Energy Services [Member] | ||
Revenue from External Customer [Line Items] | ||
Net Sales | $ 19.1 | $ 18.7 |
Subsequent Events (Details)
Subsequent Events (Details) € in Millions, $ in Millions | Apr. 18, 2018USD ($) | Apr. 01, 2018USD ($) | Apr. 02, 2017USD ($) | Dec. 31, 2017EUR (€) | Apr. 30, 2018Employee | May 09, 2014USD ($) |
Subsequent Event [Line Items] | ||||||
Revenue | $ 19.1 | $ 18.7 | ||||
Maximum borrowing capacity | $ 38.4 | |||||
Revolving Credit Facility [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Maximum borrowing capacity | $ 200 | |||||
Maturity date | May 9, 2019 | |||||
Basis points related to debt | 0.25% | |||||
Revolving Credit Facility [Member] | LIBOR [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Facility variable interest rate | 1.75% | |||||
Sivomatic [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Revenue | € | € 73 | |||||
Subsequent Event [Member] | Revolving Credit Facility [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Maximum borrowing capacity | $ 300 | |||||
Maturity date | Apr. 18, 2023 | |||||
Basis points related to debt | 0.25% | |||||
Subsequent Event [Member] | Revolving Credit Facility [Member] | LIBOR [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Facility variable interest rate | 1.625% | |||||
Subsequent Event [Member] | Sivomatic [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Number of employees | Employee | 115 |