Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | Apr. 28, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | THRM | |
Entity Registrant Name | GENTHERM INC | |
Entity Central Index Key | 903,129 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 36,429,697 |
Consolidated Condensed Balance
Consolidated Condensed Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Current Assets: | ||
Cash and cash equivalents | $ 210,556 | $ 144,479 |
Accounts receivable, less allowance of $1,129 and $955, respectively | 161,690 | 142,610 |
Inventory: | ||
Raw materials | 53,394 | 50,371 |
Work in process | 4,870 | 4,150 |
Finished goods | 28,686 | 29,662 |
Inventory, net | 86,950 | 84,183 |
Derivative financial instruments | 1,324 | |
Deferred income tax assets | 7,449 | 6,716 |
Prepaid expenses and other assets | 45,851 | 42,620 |
Total current assets | 513,820 | 420,608 |
Property and equipment, net | 131,332 | 119,157 |
Goodwill | 28,826 | 27,765 |
Other intangible assets | 47,972 | 48,461 |
Deferred financing costs | 931 | 310 |
Deferred income tax assets | 25,357 | 22,094 |
Other non-current assets | 38,297 | 8,403 |
Total assets | 786,535 | 646,798 |
Current Liabilities: | ||
Accounts payable | 84,880 | 77,115 |
Accrued liabilities | 96,078 | 60,823 |
Current maturities of long-term debt | 912 | 4,909 |
Deferred tax liabilities | 238 | 211 |
Derivative financial instruments | 429 | 725 |
Total current liabilities | 182,537 | 143,783 |
Pension benefit obligation | 6,811 | 6,545 |
Other liabilities | 4,485 | 5,026 |
Long-term debt, less current maturities | 172,524 | 92,832 |
Deferred income tax liabilities | 12,865 | 14,321 |
Total liabilities | 379,222 | 262,507 |
Common Stock: | ||
No par value; 55,000,000 shares authorized, 36,407,397 and 36,321,775 issued and outstanding at March 31, 2016 and December 31, 2015, respectively | 257,401 | 256,919 |
Paid-in capital | (920) | (1,282) |
Accumulated other comprehensive loss | (41,385) | (51,670) |
Accumulated earnings | 192,217 | 180,324 |
Total shareholders’ equity | 407,313 | 384,291 |
Total liabilities and shareholders’ equity | $ 786,535 | $ 646,798 |
Consolidated Condensed Balance3
Consolidated Condensed Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, allowance | $ 1,129 | $ 955 |
Common Stock, par value | ||
Common Stock, shares authorized | 55,000,000 | 55,000,000 |
Common Stock, shares issued | 36,407,397 | 36,321,775 |
Common Stock, shares outstanding | 36,407,397 | 36,321,775 |
Consolidated Condensed Statemen
Consolidated Condensed Statements of Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Statement [Abstract] | ||
Product revenues | $ 215,714 | $ 206,909 |
Cost of sales | 147,472 | 140,339 |
Gross margin | 68,242 | 66,570 |
Operating expenses: | ||
Net research and development expenses | 15,696 | 14,548 |
Acquisition transaction expenses | 37 | |
Selling, general and administrative | 22,624 | 24,945 |
Total operating expenses | 38,357 | 39,493 |
Operating income | 29,885 | 27,077 |
Interest expense | (677) | (564) |
Revaluation of derivatives loss | (964) | |
Foreign currency gain (loss) | (1,835) | 435 |
Other income | 365 | 195 |
Earnings before income tax | 27,738 | 26,179 |
Income tax expense | 15,845 | 6,359 |
Net income | $ 11,893 | $ 19,820 |
Basic earnings per share | $ 0.33 | $ 0.55 |
Diluted earnings per share | $ 0.33 | $ 0.55 |
Weighted average number of shares – basic | 36,356,973 | 35,769,190 |
Weighted average number of shares – diluted | 36,550,863 | 36,244,695 |
Consolidated Condensed Stateme5
Consolidated Condensed Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Statement Of Income And Comprehensive Income [Abstract] | ||
Net income | $ 11,893 | $ 19,820 |
Other comprehensive loss, gross of tax: | ||
Foreign currency translation adjustments gain (loss) | 7,910 | (19,605) |
Unrealized gain (loss) on foreign currency derivative securities | 1,293 | (347) |
Unrealized gain on commodity derivative securities | 296 | 76 |
Other comprehensive income (loss), gross of tax | 9,499 | (19,876) |
Other comprehensive income (loss), related tax effect: | ||
Foreign currency translation adjustments gain (loss) | 1,242 | 467 |
Unrealized gain (loss) on foreign currency derivative securities | (347) | |
Unrealized gain on commodity derivative securities | (109) | 89 |
Other comprehensive income (loss), related tax effect | 786 | 556 |
Other comprehensive income (loss), net of tax | 10,285 | (19,320) |
Comprehensive income | $ 22,178 | $ 500 |
Consolidated Condensed Stateme6
Consolidated Condensed Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Operating Activities: | ||
Net income | $ 11,893 | $ 19,820 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Depreciation and amortization | 8,164 | 7,459 |
Deferred income tax benefit | (5,173) | (2,483) |
Stock compensation | 1,818 | 1,358 |
Defined benefit plan expense (income) | 45 | (9) |
Provision of doubtful accounts | 574 | 125 |
Gain on revaluation of financial derivatives | (456) | (324) |
(Gain) loss on sale of property and equipment | 29 | (8) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (21,906) | (15,994) |
Inventory | (1,223) | (5,762) |
Prepaid expenses and other assets | (1,628) | (3,905) |
Accounts payable | 6,392 | 15,522 |
Accrued liabilities | 7,819 | (6,970) |
Net cash provided by operating activities | 6,348 | 8,829 |
Investing Activities: | ||
Investment in subsidiary, net of cash acquired | (47) | |
Proceeds from the sale of property and equipment | 18 | 181 |
Purchases of property and equipment | (17,010) | (10,403) |
Net cash used in investing activities | (16,992) | (10,269) |
Financing Activities: | ||
Borrowing of debt | 75,000 | |
Repayments of debt | (446) | (1,669) |
Excess tax benefit from equity awards | (385) | |
Cash paid for financing costs | (650) | |
Cash paid for the cancellation of restricted stock | (793) | (467) |
Proceeds from the exercise of Common Stock options | 204 | 2,026 |
Net cash provided by (used in) financing activities | 72,930 | (110) |
Foreign currency effect | 3,791 | (4,569) |
Net increase (decrease) in cash and cash equivalents | 66,077 | (6,119) |
Cash and cash equivalents at beginning of period | 144,479 | 85,700 |
Cash and cash equivalents at end of period | 210,556 | 79,581 |
Supplemental disclosure of cash flow information: | ||
Cash paid for taxes | 9,342 | 14,768 |
Cash paid for interest | 458 | 515 |
Supplemental disclosure of non-cash transactions: | ||
Common Stock issued to Board of Directors and employees | $ 984 | $ 673 |
Consolidated Condensed Stateme7
Consolidated Condensed Statement of Changes In Shareholders' Equity - 3 months ended Mar. 31, 2016 - USD ($) $ in Thousands | Total | Common Stock | Paid-in Capital | Accumulated Earnings | Accumulated Other Comprehensive Loss |
Beginning Balance at Dec. 31, 2015 | $ 384,291 | $ 256,919 | $ (1,282) | $ 180,324 | $ (51,670) |
Beginning Balance (in shares) at Dec. 31, 2015 | 36,321,775 | 36,322,000 | |||
Exercise of Common Stock options for cash | $ 204 | $ 291 | (87) | ||
Exercise of Common Stock options for cash (in shares) | 14,000 | ||||
Tax benefit from exercises of Common Stock options | (385) | (385) | |||
Cancellation of restricted stock | (793) | $ (793) | |||
Cancellation of restricted stock (in shares) | (17,000) | ||||
Stock option compensation | 834 | 834 | |||
Common Stock issued to Board of Directors and employees | 984 | $ 984 | |||
Common Stock issued to Board of Directors and employees (in shares) | 88,000 | ||||
Currency translation, net | 9,152 | 9,152 | |||
Foreign currency hedge, net | 946 | 946 | |||
Commodity hedge, net | 187 | 187 | |||
Net income | 11,893 | 11,893 | |||
Ending Balance at Mar. 31, 2016 | $ 407,313 | $ 257,401 | $ (920) | $ 192,217 | $ (41,385) |
Ending Balance (in shares) at Mar. 31, 2016 | 36,407,397 | 36,407,000 |
The Company and Subsequent Even
The Company and Subsequent Events | 3 Months Ended |
Mar. 31, 2016 | |
Company And Subsequent Events [Abstract] | |
The Company and Subsequent Events | Note 1 – The Company and Subsequent Events Gentherm Incorporated is a global technology and industry leader in the design, development, and manufacturing of innovative thermal management technologies and automotive cable systems. Unless the context otherwise requires, the terms “Company”, “we”, “us” and “our” used herein refer to Gentherm Incorporated and its consolidated subsidiaries. Our products provide solutions for automotive passenger comfort and convenience, battery thermal management, remote power generation and other consumer and industrial temperature control needs. Our products can be found on the vehicles of nearly all major automotive manufacturers operating in North America, Europe and Asia. We operate in locations aligned with our major customers’ product strategies in order to provide locally enhanced design, integration and production capabilities and to identify future thermal technology product opportunities in both automotive and other markets. We concentrate our research on the development of new technologies that will enable new products, improve overall effectiveness of existing products and maximize customer satisfaction. We also focus on developing new design applications from our existing technologies to create new products and market opportunities for thermal comfort solutions. On January 4, 2016 and January 5, 2016, the Company completed reorganization transactions (the “Reorganization”) related to our North American business (the “Windsor Operations”). As part of our original integration plan to eliminate redundancies associated with the 2011 acquisition of Gentherm GmbH (formally named W.E.T. Automotive Systems AG), the Windsor Operations will be consolidated into our existing European and North American facilities. As a result of the Reorganization, some of the business activities previously performed by the Windsor Operations will now be performed by other subsidiaries. Related to the Reorganization, the Company declared an intercompany dividend, incurred and paid a related withholding tax to the Canadian Revenue Agency and recorded a tax expense of approximately $6,300, during the first quarter of 2016. Later during the quarter, a further intercompany dividend was declared and paid resulting in an additional $1,300 withholding tax being paid and expensed and the Company changed its assessment of the potential for further dividends and accrued and expensed, but did not pay, an estimated final withholding tax amount totaling $2,000. This estimate is expected to cover the amount of all future intercompany dividends needed to distribute the remaining earnings of the subsidiary to its parent in conjunction with the final liquidation of the subsidiary. In addition to the $9,600 in combined withholding taxes, the Reorganization will require the Company to make a one-time income tax payment of approximately $32,000. The one-time income tax payment was accrued during the first quarter of 2016; however, the Company also recorded an offsetting deferred charge for approximately the same amount because the one-time income tax payment will result in tax deductions against income taxes in future periods. Therefore, the income tax payment did not have a material impact on the Company’s earnings during the first quarter of 2016 and is not expected to have a material impact in any future fiscal quarter. The income tax payment will be paid during 2017 and is included in accrued liabilities as of March 31, 2016. The deferred charge is included in other non-current assets as of March 31, 2016. Subsequent Events We have evaluated subsequent events through the date that our consolidated condensed financial statements are issued. On April 1, 2016, we acquired all of the equity of privately-held Cincinnati Sub-Zero Products, LLC (“CSZ”) and related assets in an all-cash transaction for approximately $73,000, net of cash acquired. Based in Cincinnati, Ohio, CSZ manufactures both high quality patient temperature systems for the health care industry and custom environmental text chambers used by a wide range of industrial manufacturing companies for product testing. CSZ’s 2015 revenues were approximately $63,000. For the three months ended March 31, 2016, CSZ’s revenues were approximately $16,000. |
Basis of Presentation and New A
Basis of Presentation and New Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2016 | |
Basis Of Presentation And New Accounting Pronouncements [Abstract] | |
Basis of Presentation and New Accounting Pronouncements | Note 2 – Basis of Presentation and New Accounting Pronouncements The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in the audited annual consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted pursuant to those rules and regulations. In the opinion of management, all adjustments, consisting of normal recurring items, considered necessary for a fair presentation of our results of operations, financial position and cash flows have been included. The balance sheet as of December 31, 2015 was derived from audited annual consolidated financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. Certain reclassifications of prior year’s amounts have been made to conform with the current year’s presentation. Operating results for the three months ended March 31, 2016 is not necessarily indicative of the results that may be expected for the year ending December 31, 2016. These consolidated condensed financial statements should be read in conjunction with the financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2015. Financial Instruments In January, 2016, the FASB issued ASU 2016-01, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities” ASU 2016-01 requires equity investments not accounted for under the equity method of accounting or result in consolidation of an investee, that have readily determinable fair values to be measured at fair value with changes in the fair value recognized in net income. The update simplifies the impairment assessment for equity investments without readily determinable fair values by requiring assessment for impairment qualitatively, similar to the impairment assessment currently used for long-lived assets, goodwill and indefinite-lived intangible assets. The amendments in this update also change the disclosure requirements for financial instruments, including eliminating the requirement to disclose the method and significant assumptions used to estimate the fair value for financial instruments measured at amortized costs on the balance sheet. ASU 2016-01 is effective for fiscal years and interim periods beginning after December 15, 2017 and early adoption of the amendments in this update, in general, is not permitted. ASU 2016-01 is not expected to significantly impact the Company. Leases In February, 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” ASU 2016-02 requires lessees to recognize on their balance sheet a liability to make lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term. Payments to be made in optional periods should be included in the measurement of lease assets and liabilities if the lessee is reasonably certain it will exercise an option to extend the lease or not exercise an option to terminate the lease. While ASU 2016-02 continues to differentiate between finance or capital leases and operating leases, the principal change from current lease accounting guidance is that lease assets and liabilities arising from operating leases should be recognized on the balance sheet. ASU 2016-02 is effective for fiscal years and interim periods beginning after December 15, 2018. Early adoption of the amendments in this update is permitted. Lessees are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach which includes a number of practical expedients, including the ability to use hindsight in evaluating lessee options to extend or terminate a lease. An entity that elects to apply the practical expedients will be required to recognize a right-of-use asset and lease liability for all operating leases at each reporting date based on the present value of the remaining minimum rental payment that were tracked and disclosed under previous GAAP. We are currently in the process of determining the impact the implementation of ASU 2016-02 will have on the Company’s financial statements. Note 2 – Basis of Presentation and New Accounting Pronouncements – Continued Stock Compensation In March, 2016, the FASB issued ASU 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” ASU 2016-09 involves several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. Under the new standard, income tax benefits and deficiencies are to be recognized as income tax expense or benefit in the income statement and the tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur. An entity should also recognize excess tax benefits regardless of whether the benefit reduces taxes payable in the current period. Excess tax benefits should be classified along with other income tax cash flows as an operating activity. In regards to forfeitures, the entity may make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. ASU 2016-09 is effective for fiscal years and interim periods beginning after December 15, 2016. Early adoption of the amendments in this update is permitted Revenue from Contracts with Customers In May, 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” ASU 2014-09 was developed to enable financial statement users to better understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The update’s core principal is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Companies are to use a five-step contract review model to ensure revenue gets recognized, measured and disclosed in accordance with this principle. ASU 2014-09 was to be effective for fiscal years and interim periods beginning after December 15, 2016. On July 9, 2015, the FASB decided to defer by one year the effective date for both public and nonpublic entities. As a result, ASU 2014-09 is now effective for fiscal years and interim periods beginning after December 15, 2017. The amendments in this update will be applied retrospectively either to each prior reporting period presented or to disclose the cumulative effect recognized at the date of initial application. Gentherm has developed a plan to complete the five-step contract review process for all existing contracts with customers. We are currently in the process of determining the impact the implementation of ASU 2014-09 will have on the Company’s financial statements. Inventory – Simplifying the Measurement of Inventory In July, 2015, the FASB issued ASU 2015-11, “ Inventory (Topic 330) Simplifying the Measurement of Inventory.” The update requires that inventory measured using any method other than last-in, first-out (LIFO) or the retail inventory method shall be measured at the lower of cost and net realizable value. ASU 2015-11 is effective for fiscal years and interim periods beginning after December 15, 2016 and is not expected to significantly impact the Company. Balance Sheet Classification of Deferred Taxes In November, 2015, the FASB issued ASU 2015-17, “ Income Taxes (Topic 740) Balance Sheet Classification of Deferred Taxes.” ASU 2015-17 no longer requires an entity to separate deferred income tax liabilities and assets into current and noncurrent amounts on the balance sheet. Instead, for each tax paying component and within each tax jurisdiction all deferred tax liabilities and assets, as well as related valuation allowance, shall be offset and presented as a single noncurrent amount. Entities will continue to not offset deferred tax liabilities and assets attributable to different tax-paying components of the entity or to different tax jurisdictions. ASU 2015-17 is effective for fiscal years and interim periods beginning after December 15, 2016, though earlier application is permitted. The update can be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. We anticipate adoption of ASU 2015-17 will impact our presentation of deferred tax liabilities and assets on the consolidated condensed balance sheets . |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Note 3 – Basic earnings per share are computed by dividing net income by the weighted average number of shares of stock outstanding during the period. The Company’s diluted earnings per share give effect to all potential Common Stock outstanding during a period that do not have an anti-dilutive impact to the calculation. In computing the diluted earnings per share, the treasury stock method is used in determining the number of shares assumed to be issued from the exercise of Common Stock equivalents. The following summarizes the Common Stock included in the basic and diluted shares, as disclosed on the face of the consolidated condensed statements of income: Three Months 2016 2015 Weighted average number of shares for calculation of basic EPS 36,356,973 35,769,190 Stock options under equity incentive plans 193,890 475,505 Weighted average number of shares for calculation of diluted EPS 36,550,863 36,244,695 The accompanying table represents Common Stock issuable upon the exercise of certain stock options that have been excluded from the diluted earnings calculation because the effect of their inclusion would be anti-dilutive. Three Months 2016 2015 Stock options outstanding for equity incentive plans 1,062,534 — |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 4 – Segment Reporting Segment information is used by management for making operating decisions for the Company. Management evaluates the performance of the Company’s segments based primarily on operating income or loss. The Company’s reportable segments are as follows: Automotive · Industrial – the combined operating results of Gentherm Global Power Technologies (“GPT”) and Gentherm’s advanced research and development division. Advanced research and development includes efforts focused on improving the efficiency of thermoelectric technologies and advanced heating wire technology as well as other applications. The segment includes government sponsored research projects. Reconciling Items – The tables below present segment information about the reported product revenues, depreciation and amortization and operating income (loss) of the Company for three month periods ended March 31, 2016 and 2015. With the exception of goodwill, asset information by segment is not reported since the Company does not manage assets at a segment level. As of March 31, 2016, goodwill assigned to our Automotive and Industrial segments were $22,675 and $6,151, respectively. As of March 31, 2015, goodwill assigned to our Automotive and Industrial segments were $21,368 and $6,305, respectively. Note 4 – Segment Reporting – Continued Three Months Ended March 31, Automotive Industrial Reconciling Consolidated 2016: Product revenues $ 210,435 $ 5,279 $ — $ 215,714 Depreciation and amortization 7,283 390 491 8,164 Operating income (loss) 42,701 (2,616 ) (10,200 ) 29,885 2015: Product revenues $ 199,443 $ 7,466 $ — $ 206,909 Depreciation and amortization 6,316 489 654 7,459 Operating income (loss) 40,682 (1,287 ) (12,318 ) 27,077 Total product revenues information by geographic area is as follows: Three Months Ended March 31, 2016 2015 United States $ 101,740 47 % $ 95,304 46 % South Korea 19,096 9 % 22,863 11 % Germany 18,167 8 % 18,840 9 % China 17,422 8 % 17,970 9 % Japan 12,234 6 % 11,185 5 % Czech Republic 9,671 5 % 6,159 3 % Canada 8,982 4 % 5,485 3 % United Kingdom 6,667 3 % 6,988 3 % Mexico 5,581 3 % 5,433 3 % Other 16,154 7 % 16,682 8 % Total Non U.S. 113,974 53 % 111,605 54 % $ 215,714 100 % $ 206,909 100 % |
Debt
Debt | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt | Note 5 – Debt Credit Agreement On March 17, 2016, the Company, together with certain direct and indirect subsidiaries, executed the Second Amendment to the Credit Agreement (the “Amended Credit Agreement”) with a consortium of lenders and Bank of America, N.A., as administrative agent. The Amended Credit Agreement eliminated without penalty the U.S. Term and Europe Term Loans and increased the aggregate principal amount available for borrowing under the U.S. Revolving Note from $100,000 to $250,000. New subsidiary borrowers and guarantors were added under the Amended Credit Agreement and related pledge and security agreement. The security agreement grants a security interest in substantially all of the personal property of subsidiaries designated as borrowers to secure their respective obligations under the Amended Credit Agreement, including the stock and membership interests of specified subsidiaries (limited to 66% of the stock in the case of certain non-US subsidiaries). The Amended Credit Agreement restricts the amount of dividend payments the Company can make to shareholders. The Amended Credit Agreement replaced the Company’s requirement to maintain a minimum Consolidated Fixed Charge Coverage Ratio with a minimum Consolidated Interest Coverage Ratio. The Company must also maintain a maximum Consolidated Leverage Ratio. Definitions for these financial ratios, and a description of modifications made to other covenants to which the Company and its subsidiaries are subject, are included in the Amended Credit Agreement. Note 5 – Debt – Continued Under the Amended Credit Agreement, U.S. Dollar denominated loans bear interest at either a base rate (“Base Rate”) or Eurocurrency rate (“Eurocurrency Rate”), plus a margin (“Applicable Rate”). The Base Rate is equal to the highest of the Federal Fund Rate (0.25% at March 31, 2016) plus 0.50%, Bank of America’s prime rate (3.50% at March 31, 2016), or a one month Eurocurrency rate (0.00% at March 31, 2016) plus 1.00%. The Eurocurrency Rate for loans denominated in U.S. Dollars or European Euros is equal to the London Interbank Offered Rate (0.38% at March 31, 2016). All loans denominated in a currency other than the U.S. Dollar must be Eurocurrency Rate Loans. Interest is payable at least quarterly. The Applicable Rate from the initial period of March 17, 2016 through the fiscal quarter ending September 30, 2016 is 1.50% per annum for Eurocurrency Rate Loans and 0.50% per annum for Base Rate Loans. After the initial period, the Applicable Rate will vary based on the Consolidate Leverage Ratio reported by the Company. As long as the Company is not in default of the terms and conditions of the Credit Agreement, the lowest and highest possible Applicable Rate is 1.25% and 2.00%, respectively, for Eurocurrency Rate Loans and 0.25% and 1.00%, respectively, for Base Rate Loans. The Company also has two fixed interest rate loans with the German Investment Corporation (“DEG”), a subsidiary of KfW Banking Group, a Germany government-owned development bank: DEG China Loan The first DEG loan, a loan we used to fund capital investments in China (the “DEG China Loan”), is subject to semi-annual principal payments beginning March, 2015 and ending September, 2019. Under the terms of the DEG China Loan, the Company must maintain a minimum Debt-to-Equity Ratio, Current Ratio and Debt Service Coverage Ratio, as defined by the DEG China Loan agreement, based on the financial statements of Gentherm’s wholly owned subsidiary, Gentherm Automotive Systems (China) Limited. DEG Vietnam Loan The Company’s second fixed interest rate loan agreement with DEG was used to finance the construction and set up of the Vietnam production facility (“DEG Vietnam Loan”). The DEG Vietnam Loan is subject to semi-annual principal payments beginning November, 2017 and ending May, 2023. Under the terms of the DEG Vietnam Loan, the Company must maintain a minimum Current Ratio, Equity Ratio and Enhanced Equity Ratio, as defined by the DEG Vietnam Loan agreement, based on the financial statements of Gentherm’s wholly owned subsidiary, Gentherm Vietnam Co. Ltd. The following table summarizes the Company’s debt at March 31, 2016 and at December 31, 2015. March 31, 2016 December 31, Interest Principal Principal Credit Agreement: U.S. Term Loan $ — $ 46,875 Europe Term Loan — 20,369 Revolving Note (U.S. Dollar Denominations) 1.97 % 133,875 12,000 Revolving Note (Euro Denominations) 1.50 % 21,370 — DEG China Loan 4.25 % 3,191 3,497 DEG Vietnam Loan 5.21 % 15,000 15,000 Total debt 173,436 97,741 Current portion (912 ) (4,909 ) Long-term debt, less current maturities $ 172,524 $ 92,832 Note 5 – Debt – Continued The scheduled principal maturities of our debt as of March 31, 2016 is as follows: Year Revolving Revolving DEG DEG Total 2016 $ — $ — $ 456 $ — $ 456 2017 — — 911 1,250 2,161 2018 — — 912 2,500 3,412 2019 — — 912 2,500 3,412 2020 — — — 2,500 2,500 2021 133,875 21,370 — 2,500 157,745 Thereafter — — — 3,750 3,750 Total $ 133,875 $ 21,370 $ 3,191 $ 15,000 $ 173,436 Principal outstanding under the Revolving Note will be due and payable in full on March 17, 2021. As of March 31, 2016, we were in compliance with all terms as outlined in the Amended Credit Agreement, DEG China Loan and DEG Vietnam Loan. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2016 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Note 6 – Derivative Financial Instruments We are exposed to market risk from changes in foreign currency exchange rates, short-term interest rates and price fluctuations of certain material commodities such as copper. Market risks for changes in interest rates relate primarily to our debt obligations under our Credit Agreement. Foreign currency exchange risks are attributable to sales to foreign customers and purchases from foreign suppliers not denominated in the location’s functional currency, foreign plant operations, intercompany indebtedness, intercompany investments and include exposures to the European Euro, Mexican Peso, Canadian Dollar, Hungarian Forint, Macedonian Denar, Ukrainian Hryvnia, Japanese Yen, Chinese Renminbi, Korean Won and Vietnamese Dong. The Company regularly enters into derivative contracts with the objective of managing its financial and operational exposure arising from these risks by offsetting gains and losses on the underlying exposures with gains and losses on the financial instruments used to hedge them. The maximum length of time over which we hedge our exposure to foreign currency exchange risks is one year. We had foreign currency derivative contracts with a notional value of $24,944 and $0 outstanding as of March 31, 2016 and December 31, 2015, respectively. The maximum length of time over which we hedge our exposure to price fluctuations in material commodities is two years. We had copper commodity swap contracts with a notional value of $4,071 and $4,885 outstanding at March 31, 2016 and December 31, 2015, respectively. We do not enter into derivative financial instruments for speculative or trading purposes. Our hedging relationships are formally documented at the inception of the hedge, and hedges must be highly effective in offsetting changes to future cash flows on hedged transactions both at the inception of a hedge and on an ongoing basis to be designated for hedge accounting treatment. For derivative contracts which can be classified as a cash flow hedge, the effective portion of the change in the fair value of the derivative is recorded to accumulated other comprehensive loss in the consolidated balance sheet. When the underlying hedge transaction is realized, the gain or loss included in accumulated other comprehensive loss is recorded in earnings in the consolidated statement of income on the same line as the gain or loss on the hedged item attributable to the hedged risk. We record the ineffective portion of foreign currency hedging instruments, if any, to foreign currency gain (loss) in the consolidated statements of income. Though we continuously monitor the hedging program, derivative positions and hedging strategies, foreign currency forward exchange agreements have not always been designated as hedging instruments for accounting purposes. The Company uses an income approach to value derivative instruments, analyzing quoted market prices to calculate the forward values and then discounts such forward values to the present value using benchmark rates at commonly quoted intervals for the instrument’s full term. Note 6 – Derivative Financial Instruments – Continued Information related to the recurring fair value measurement of derivative instruments in our consolidated condensed balance sheet as of March 31, 2016 is as follows: Asset Derivatives Liability Derivatives Net Asset/ Hedge Fair Value Balance Sheet Fair Balance Sheet Fair Foreign currency derivatives Cash flow hedge Level 2 Current assets $ 1,324 $ 1,324 Commodity derivatives Cash flow hedge Level 2 Current liabilities $ (429 ) $ (429 ) Information relating to the effect of derivative instruments on our consolidated condensed statements of income is as follows: Location Three Months Three Months Foreign currency derivatives Revaluation of derivatives $ — $ 6,197 Cost of sales 35 (128 ) Selling, general and administrative 139 21 Other comprehensive income 1,293 (347 ) Foreign currency (loss) gain 78 207 Total foreign currency derivatives $ 1,545 $ 5,950 Commodity derivatives Cost of sales $ (211 ) $ (7,161 ) Other comprehensive income $ 296 $ — Total commodity derivatives $ 85 $ (7,161 ) We did not incur any hedge ineffectiveness during the three months ended March 31, 2016 and 2015. |
Fair Value Measurement
Fair Value Measurement | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | Note 7 – Fair Value Measurement The Company bases fair value on a price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We have adopted a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Inputs, other than quoted market prices included in Level 1, that are observable either directly or indirectly for the asset or liability. Level 3: Unobservable inputs that are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and also considers counterparty credit risk in its assessment of fair value. Note 7 – Fair Value Measurement – Continued Except for derivative instruments (see Note 6), pension liabilities, pension plan assets and a corporate owned life insurance policy, the Company has no financial assets and liabilities that are carried at fair value at March 31, 2016 and December 31, 2015. The carrying amounts of financial instruments comprising cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to the relatively short maturity of such instruments. The Company uses an income valuation technique to measure the fair values of its debt instruments by converting amounts of future cash flows to a single present value amount using rates based on current market expectations (Level 2 inputs). As of March 31, 2016 and December 31, 2015, the carrying values of the Company’s Amended Credit Agreement indebtedness and Credit Agreement indebtedness for the periods ending March 31, 2016 and December 31, 2015, respectively, were not materially different than their estimated fair values because the interest rates on variable rate debt approximated rates currently available to the Company (see Note 5). Discount rates used to measure the fair value of Gentherm’s DEG Vietnam Loan and DEG China Loan are based on quoted swap rates. As of March 31, 2016, the carrying values of the DEG Vietnam Loan and DEG China Loan were $15,000 and $3,191, respectively, as compared to an estimated fair value of $15,543 and $3,782, respectively. As of December 31, 2015, the carrying value of the DEG Vietnam Loan and DEG China Loan were $15,000 and $3,497, respectively, as compared to an estimated fair value of $15,056 and $3,588, respectively. Certain Company assets are required to be recorded at fair value on a non-recurring basis when events and circumstances indicate that the carrying value may not be recoverable. As of March 31, 2016 and December 31, 2015, the Company did not realize any changes to the fair value of these assets due to the non-occurrence of events or circumstances that could negatively impact their recoverability. |
Reclassifications Out of Accumu
Reclassifications Out of Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2016 | |
Equity [Abstract] | |
Reclassifications Out of Accumulated Other Comprehensive Income (Loss) | Note 8 – Reclassifications Out of Accumulated Other Comprehensive Income (Loss) Reclassification adjustments and other activities impacting accumulated other comprehensive income (loss) during the three months ended March 31, 2016 and March 31, 2015 are as follows: Defined Benefit Pension Plans Foreign Currency Translation Adjustments Commodity Hedge Derivatives Foreign Currency Hedge Derivatives Total Balance at December 31, 2015 $ (2,060 ) $ (49,381 ) $ (229 ) $ — $ (51,670 ) Other comprehensive income (loss) before reclassifications — 7,910 114 1,293 9,317 Income tax effect of other comprehensive income (loss) before reclassifications — 1,242 (42 ) (347 ) 853 Amounts reclassified from accumulated other comprehensive income (loss) into net income — — 182 a — 182 Income taxes reclassified into net income — — (67 ) — (67 ) Net current period other comprehensive income (loss) — 9,152 187 946 10,285 Balance at March 31, 2016 $ (2,060 ) $ (40,229 ) $ (42 ) $ 946 $ (41,385 ) (a) The amounts reclassified from accumulated other comprehensive income are included in cost of sales. Note 8 – Reclassifications Out of Accumulated Other Comprehensive Income (Loss) – Continued Defined Benefit Pension Plans Foreign Currency Translation Adjustments Commodity Hedge Derivatives Foreign Currency Hedge Derivatives Total Balance at December 31, 2014 $ (2,673 ) $ (23,060 ) $ — $ (10 ) $ (25,743 ) Other comprehensive income (loss) before reclassifications — (19,605 ) 76 (357 ) (19,886 ) Income tax effect of other comprehensive income (loss) before reclassifications — 467 — 89 556 Amounts reclassified from accumulated other comprehensive income (loss) into net income — — — 10 a 10 Income taxes reclassified into net income — — — — — Net current period other comprehensive income (loss) — (19,138 ) 76 (258 ) (19,320 ) Balance at March 31, 2015 $ (2,673 ) $ (42,198 ) $ 76 $ (268 ) $ (45,063 ) (a) The amounts reclassified from accumulated other comprehensive income are included in cost of sales. We expect all of the existing gains and losses related to foreign currency and commodity derivatives reported in accumulated other comprehensive income as of March 31, 2016 to be reclassified into earning during the twelve month period ending December 31, 2016. |
Basis of Presentation and New16
Basis of Presentation and New Accounting Pronouncements (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Basis Of Presentation And New Accounting Pronouncements [Abstract] | |
Financial Instruments | Financial Instruments In January, 2016, the FASB issued ASU 2016-01, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities” ASU 2016-01 requires equity investments not accounted for under the equity method of accounting or result in consolidation of an investee, that have readily determinable fair values to be measured at fair value with changes in the fair value recognized in net income. The update simplifies the impairment assessment for equity investments without readily determinable fair values by requiring assessment for impairment qualitatively, similar to the impairment assessment currently used for long-lived assets, goodwill and indefinite-lived intangible assets. The amendments in this update also change the disclosure requirements for financial instruments, including eliminating the requirement to disclose the method and significant assumptions used to estimate the fair value for financial instruments measured at amortized costs on the balance sheet. ASU 2016-01 is effective for fiscal years and interim periods beginning after December 15, 2017 and early adoption of the amendments in this update, in general, is not permitted. ASU 2016-01 is not expected to significantly impact the Company. |
Leases | Leases In February, 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” ASU 2016-02 requires lessees to recognize on their balance sheet a liability to make lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term. Payments to be made in optional periods should be included in the measurement of lease assets and liabilities if the lessee is reasonably certain it will exercise an option to extend the lease or not exercise an option to terminate the lease. While ASU 2016-02 continues to differentiate between finance or capital leases and operating leases, the principal change from current lease accounting guidance is that lease assets and liabilities arising from operating leases should be recognized on the balance sheet. ASU 2016-02 is effective for fiscal years and interim periods beginning after December 15, 2018. Early adoption of the amendments in this update is permitted. Lessees are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach which includes a number of practical expedients, including the ability to use hindsight in evaluating lessee options to extend or terminate a lease. An entity that elects to apply the practical expedients will be required to recognize a right-of-use asset and lease liability for all operating leases at each reporting date based on the present value of the remaining minimum rental payment that were tracked and disclosed under previous GAAP. We are currently in the process of determining the impact the implementation of ASU 2016-02 will have on the Company’s financial statements. |
Stock Compensation | Stock Compensation In March, 2016, the FASB issued ASU 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” ASU 2016-09 involves several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. Under the new standard, income tax benefits and deficiencies are to be recognized as income tax expense or benefit in the income statement and the tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur. An entity should also recognize excess tax benefits regardless of whether the benefit reduces taxes payable in the current period. Excess tax benefits should be classified along with other income tax cash flows as an operating activity. In regards to forfeitures, the entity may make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. ASU 2016-09 is effective for fiscal years and interim periods beginning after December 15, 2016. Early adoption of the amendments in this update is permitted |
Revenue from Contracts with Customers | Revenue from Contracts with Customers In May, 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” ASU 2014-09 was developed to enable financial statement users to better understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The update’s core principal is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Companies are to use a five-step contract review model to ensure revenue gets recognized, measured and disclosed in accordance with this principle. ASU 2014-09 was to be effective for fiscal years and interim periods beginning after December 15, 2016. On July 9, 2015, the FASB decided to defer by one year the effective date for both public and nonpublic entities. As a result, ASU 2014-09 is now effective for fiscal years and interim periods beginning after December 15, 2017. The amendments in this update will be applied retrospectively either to each prior reporting period presented or to disclose the cumulative effect recognized at the date of initial application. Gentherm has developed a plan to complete the five-step contract review process for all existing contracts with customers. We are currently in the process of determining the impact the implementation of ASU 2014-09 will have on the Company’s financial statements. |
Inventory – Simplifying the Measurement of Inventory | Inventory – Simplifying the Measurement of Inventory In July, 2015, the FASB issued ASU 2015-11, “ Inventory (Topic 330) Simplifying the Measurement of Inventory.” The update requires that inventory measured using any method other than last-in, first-out (LIFO) or the retail inventory method shall be measured at the lower of cost and net realizable value. ASU 2015-11 is effective for fiscal years and interim periods beginning after December 15, 2016 and is not expected to significantly impact the Company. |
Balance Sheet Classification of Deferred Taxes | Balance Sheet Classification of Deferred Taxes In November, 2015, the FASB issued ASU 2015-17, “ Income Taxes (Topic 740) Balance Sheet Classification of Deferred Taxes.” ASU 2015-17 no longer requires an entity to separate deferred income tax liabilities and assets into current and noncurrent amounts on the balance sheet. Instead, for each tax paying component and within each tax jurisdiction all deferred tax liabilities and assets, as well as related valuation allowance, shall be offset and presented as a single noncurrent amount. Entities will continue to not offset deferred tax liabilities and assets attributable to different tax-paying components of the entity or to different tax jurisdictions. ASU 2015-17 is effective for fiscal years and interim periods beginning after December 15, 2016, though earlier application is permitted. The update can be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. We anticipate adoption of ASU 2015-17 will impact our presentation of deferred tax liabilities and assets on the consolidated condensed balance sheets . |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Shares of Consolidated Condensed Statements of Income | The following summarizes the Common Stock included in the basic and diluted shares, as disclosed on the face of the consolidated condensed statements of income: Three Months 2016 2015 Weighted average number of shares for calculation of basic EPS 36,356,973 35,769,190 Stock options under equity incentive plans 193,890 475,505 Weighted average number of shares for calculation of diluted EPS 36,550,863 36,244,695 |
Common Stock Issuable upon Exercise of Certain Stock Options | The accompanying table represents Common Stock issuable upon the exercise of certain stock options that have been excluded from the diluted earnings calculation because the effect of their inclusion would be anti-dilutive. Three Months 2016 2015 Stock options outstanding for equity incentive plans 1,062,534 — |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment Information about Reported Product Revenues, Depreciation and Amortization and Operating Income (Loss) | The tables below present segment information about the reported product revenues, depreciation and amortization and operating income (loss) of the Company for three month periods ended March 31, 2016 and 2015. With the exception of goodwill, asset information by segment is not reported since the Company does not manage assets at a segment level. As of March 31, 2016, goodwill assigned to our Automotive and Industrial segments were $22,675 and $6,151, respectively. As of March 31, 2015, goodwill assigned to our Automotive and Industrial segments were $21,368 and $6,305, respectively. Note 4 – Segment Reporting – Continued Three Months Ended March 31, Automotive Industrial Reconciling Consolidated 2016: Product revenues $ 210,435 $ 5,279 $ — $ 215,714 Depreciation and amortization 7,283 390 491 8,164 Operating income (loss) 42,701 (2,616 ) (10,200 ) 29,885 2015: Product revenues $ 199,443 $ 7,466 $ — $ 206,909 Depreciation and amortization 6,316 489 654 7,459 Operating income (loss) 40,682 (1,287 ) (12,318 ) 27,077 |
Product Revenues Information by Geographic Area | Total product revenues information by geographic area is as follows: Three Months Ended March 31, 2016 2015 United States $ 101,740 47 % $ 95,304 46 % South Korea 19,096 9 % 22,863 11 % Germany 18,167 8 % 18,840 9 % China 17,422 8 % 17,970 9 % Japan 12,234 6 % 11,185 5 % Czech Republic 9,671 5 % 6,159 3 % Canada 8,982 4 % 5,485 3 % United Kingdom 6,667 3 % 6,988 3 % Mexico 5,581 3 % 5,433 3 % Other 16,154 7 % 16,682 8 % Total Non U.S. 113,974 53 % 111,605 54 % $ 215,714 100 % $ 206,909 100 % |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Summary of Company's Debt | The following table summarizes the Company’s debt at March 31, 2016 and at December 31, 2015. March 31, 2016 December 31, Interest Principal Principal Credit Agreement: U.S. Term Loan $ — $ 46,875 Europe Term Loan — 20,369 Revolving Note (U.S. Dollar Denominations) 1.97 % 133,875 12,000 Revolving Note (Euro Denominations) 1.50 % 21,370 — DEG China Loan 4.25 % 3,191 3,497 DEG Vietnam Loan 5.21 % 15,000 15,000 Total debt 173,436 97,741 Current portion (912 ) (4,909 ) Long-term debt, less current maturities $ 172,524 $ 92,832 |
Principal Maturities of Debt | The scheduled principal maturities of our debt as of March 31, 2016 is as follows: Year Revolving Revolving DEG DEG Total 2016 $ — $ — $ 456 $ — $ 456 2017 — — 911 1,250 2,161 2018 — — 912 2,500 3,412 2019 — — 912 2,500 3,412 2020 — — — 2,500 2,500 2021 133,875 21,370 — 2,500 157,745 Thereafter — — — 3,750 3,750 Total $ 133,875 $ 21,370 $ 3,191 $ 15,000 $ 173,436 |
Derivative Financial Instrume20
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Information Related to Recurring Fair Value Measurement of Derivative Instruments in Our Consolidated Condensed Balance Sheet | Information related to the recurring fair value measurement of derivative instruments in our consolidated condensed balance sheet as of March 31, 2016 is as follows: Asset Derivatives Liability Derivatives Net Asset/ Hedge Fair Value Balance Sheet Fair Balance Sheet Fair Foreign currency derivatives Cash flow hedge Level 2 Current assets $ 1,324 $ 1,324 Commodity derivatives Cash flow hedge Level 2 Current liabilities $ (429 ) $ (429 ) |
Information Related to Effect of Derivative Instruments on Our Consolidated Condensed Statements of Income | Information relating to the effect of derivative instruments on our consolidated condensed statements of income is as follows: Location Three Months Three Months Foreign currency derivatives Revaluation of derivatives $ — $ 6,197 Cost of sales 35 (128 ) Selling, general and administrative 139 21 Other comprehensive income 1,293 (347 ) Foreign currency (loss) gain 78 207 Total foreign currency derivatives $ 1,545 $ 5,950 Commodity derivatives Cost of sales $ (211 ) $ (7,161 ) Other comprehensive income $ 296 $ — Total commodity derivatives $ 85 $ (7,161 ) |
Reclassifications Out of Accu21
Reclassifications Out of Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Equity [Abstract] | |
Schedule of Reclassification Adjustments and Other Activities Impacting Accumulated Other Comprehensive Income (Loss) | Reclassification adjustments and other activities impacting accumulated other comprehensive income (loss) during the three months ended March 31, 2016 and March 31, 2015 are as follows: Defined Benefit Pension Plans Foreign Currency Translation Adjustments Commodity Hedge Derivatives Foreign Currency Hedge Derivatives Total Balance at December 31, 2015 $ (2,060 ) $ (49,381 ) $ (229 ) $ — $ (51,670 ) Other comprehensive income (loss) before reclassifications — 7,910 114 1,293 9,317 Income tax effect of other comprehensive income (loss) before reclassifications — 1,242 (42 ) (347 ) 853 Amounts reclassified from accumulated other comprehensive income (loss) into net income — — 182 a — 182 Income taxes reclassified into net income — — (67 ) — (67 ) Net current period other comprehensive income (loss) — 9,152 187 946 10,285 Balance at March 31, 2016 $ (2,060 ) $ (40,229 ) $ (42 ) $ 946 $ (41,385 ) (a) The amounts reclassified from accumulated other comprehensive income are included in cost of sales. Note 8 – Reclassifications Out of Accumulated Other Comprehensive Income (Loss) – Continued Defined Benefit Pension Plans Foreign Currency Translation Adjustments Commodity Hedge Derivatives Foreign Currency Hedge Derivatives Total Balance at December 31, 2014 $ (2,673 ) $ (23,060 ) $ — $ (10 ) $ (25,743 ) Other comprehensive income (loss) before reclassifications — (19,605 ) 76 (357 ) (19,886 ) Income tax effect of other comprehensive income (loss) before reclassifications — 467 — 89 556 Amounts reclassified from accumulated other comprehensive income (loss) into net income — — — 10 a 10 Income taxes reclassified into net income — — — — — Net current period other comprehensive income (loss) — (19,138 ) 76 (258 ) (19,320 ) Balance at March 31, 2015 $ (2,673 ) $ (42,198 ) $ 76 $ (268 ) $ (45,063 ) (a) The amounts reclassified from accumulated other comprehensive income are included in cost of sales. |
The Company and Subsequent Ev22
The Company and Subsequent Events - Additional Information (Detail) - USD ($) $ in Thousands | Apr. 01, 2016 | Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 |
Nature Of Company [Line Items] | ||||
Amount paid withholding tax in Canadian Revenue Agency | $ 6,300 | |||
Combined withholding taxes relates to reorganization | 9,600 | |||
Accrued one-time income tax payment | 32,000 | |||
Businesses acquisition, net of cash consideration | $ 47 | |||
Cincinnati Sub-Zero Products, LLC | ||||
Nature Of Company [Line Items] | ||||
Revenues | $ 16,000 | $ 63,000 | ||
Subsequent Event | ||||
Nature Of Company [Line Items] | ||||
Amount paid withholding tax in Canadian Revenue Agency | $ 1,300 | |||
Expects to pay withholding tax amount in Canadian Revenue Agency | 2,000 | |||
Subsequent Event | Cincinnati Sub-Zero Products, LLC | ||||
Nature Of Company [Line Items] | ||||
Businesses acquisition, net of cash consideration | $ 73,000 |
Earnings per Share (Detail)
Earnings per Share (Detail) - shares | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Weighted average number of shares for calculation of basic EPS | 36,356,973 | 35,769,190 |
Stock options under equity incentive plans | 193,890 | 475,505 |
Weighted average number of shares for calculation of diluted EPS | 36,550,863 | 36,244,695 |
Stock options outstanding for equity incentive plans | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Common stock that have been excluded from the diluted shares calculation | 1,062,534 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 |
Segment Reporting Information [Line Items] | |||
Goodwill | $ 28,826 | $ 27,765 | |
Automotive Segments | |||
Segment Reporting Information [Line Items] | |||
Goodwill | 22,675 | $ 21,368 | |
Industrial Segments | |||
Segment Reporting Information [Line Items] | |||
Goodwill | $ 6,151 | $ 6,305 |
Segment Information about Repor
Segment Information about Reported Product Revenues, Depreciation and Amortization and Operating Income (Loss) (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Segment Reporting Information [Line Items] | ||
Product revenues | $ 215,714 | $ 206,909 |
Depreciation and amortization | 8,164 | 7,459 |
Operating income (loss) | 29,885 | 27,077 |
Operating Segments | Automotive Segments | ||
Segment Reporting Information [Line Items] | ||
Product revenues | 210,435 | 199,443 |
Depreciation and amortization | 7,283 | 6,316 |
Operating income (loss) | 42,701 | 40,682 |
Operating Segments | Industrial Segments | ||
Segment Reporting Information [Line Items] | ||
Product revenues | 5,279 | 7,466 |
Depreciation and amortization | 390 | 489 |
Operating income (loss) | (2,616) | (1,287) |
Reconciling Items | ||
Segment Reporting Information [Line Items] | ||
Depreciation and amortization | 491 | 654 |
Operating income (loss) | $ (10,200) | $ (12,318) |
Segment Reporting (Detail)
Segment Reporting (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Segment Reporting Information [Line Items] | ||
Product revenues | $ 215,714 | $ 206,909 |
Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 100.00% | 100.00% |
United States | ||
Segment Reporting Information [Line Items] | ||
Product revenues | $ 101,740 | $ 95,304 |
United States | Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 47.00% | 46.00% |
South Korea | ||
Segment Reporting Information [Line Items] | ||
Product revenues | $ 19,096 | $ 22,863 |
South Korea | Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 9.00% | 11.00% |
Germany | ||
Segment Reporting Information [Line Items] | ||
Product revenues | $ 18,167 | $ 18,840 |
Germany | Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 8.00% | 9.00% |
China | ||
Segment Reporting Information [Line Items] | ||
Product revenues | $ 17,422 | $ 17,970 |
China | Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 8.00% | 9.00% |
Japan | ||
Segment Reporting Information [Line Items] | ||
Product revenues | $ 12,234 | $ 11,185 |
Japan | Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 6.00% | 5.00% |
Czech Republic | ||
Segment Reporting Information [Line Items] | ||
Product revenues | $ 9,671 | $ 6,159 |
Czech Republic | Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 5.00% | 3.00% |
Canada | ||
Segment Reporting Information [Line Items] | ||
Product revenues | $ 8,982 | $ 5,485 |
Canada | Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 4.00% | 3.00% |
United Kingdom | ||
Segment Reporting Information [Line Items] | ||
Product revenues | $ 6,667 | $ 6,988 |
United Kingdom | Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 3.00% | 3.00% |
Mexico | ||
Segment Reporting Information [Line Items] | ||
Product revenues | $ 5,581 | $ 5,433 |
Mexico | Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 3.00% | 3.00% |
Other | ||
Segment Reporting Information [Line Items] | ||
Product revenues | $ 16,154 | $ 16,682 |
Other | Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 7.00% | 8.00% |
Non U.S. | ||
Segment Reporting Information [Line Items] | ||
Product revenues | $ 113,974 | $ 111,605 |
Non U.S. | Sales Revenue, Net | Geographic Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Total product revenues in percentage | 53.00% | 54.00% |
Debt - Additional Information (
Debt - Additional Information (Detail) - USD ($) | Mar. 17, 2016 | Mar. 31, 2016 | Sep. 30, 2016 | Mar. 16, 2016 |
Debt Instrument [Line Items] | ||||
Maximum percentage of stock of non US subsidiaries pledge to secure obligation | 66.00% | |||
Revolving Note | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, due date | Mar. 17, 2021 | |||
Federal Funds Rate | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 0.25% | |||
Federal Funds Rate | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 0.50% | |||
London Interbank Offered Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 0.38% | |||
Revolving Note (U.S. Dollar) | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount available for borrowing | $ 250,000,000 | $ 100,000,000 | ||
United State Bank Of America Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 3.50% | |||
Euro Currency Rate Loans | Scenario, Forecast | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 1.50% | |||
Euro Currency Rate Loans | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 1.25% | 0.00% | ||
Euro Currency Rate Loans | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 2.00% | 1.00% | ||
Base Rate Loans | Scenario, Forecast | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 0.50% | |||
Base Rate Loans | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 0.25% | |||
Base Rate Loans | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 1.00% | |||
DEG Loan | ||||
Debt Instrument [Line Items] | ||||
Semi-annual principal payments earliest date | 2015-03 | |||
Semi-annual principal payments latest date | 2019-09 | |||
DEG Vietnam Loan | ||||
Debt Instrument [Line Items] | ||||
Semi-annual principal payments earliest date | 2017-11 | |||
Semi-annual principal payments latest date | 2023-05 |
Summary of Company's Debt (Deta
Summary of Company's Debt (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Total debt | $ 173,436 | $ 97,741 |
Current portion | (912) | (4,909) |
Long-term debt, less current maturities | $ 172,524 | 92,832 |
Revolving Note (U.S. Dollar Denominations) | ||
Debt Instrument [Line Items] | ||
Interest Rate | 1.97% | |
Total debt | $ 133,875 | 12,000 |
Revolving Note (Euro Denominations) | ||
Debt Instrument [Line Items] | ||
Interest Rate | 1.50% | |
Total debt | $ 21,370 | |
DEG China Loan | ||
Debt Instrument [Line Items] | ||
Interest Rate | 4.25% | |
Total debt | $ 3,191 | 3,497 |
DEG Vietnam Loan | ||
Debt Instrument [Line Items] | ||
Interest Rate | 5.21% | |
Total debt | $ 15,000 | 15,000 |
U.S. Term Loan | ||
Debt Instrument [Line Items] | ||
Total debt | 46,875 | |
Europe Term Loan | ||
Debt Instrument [Line Items] | ||
Total debt | $ 20,369 |
Principal Maturities of Debt (D
Principal Maturities of Debt (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Debt maturing in 2016 | $ 456 | |
Debt maturing in 2017 | 2,161 | |
Debt maturing in 2018 | 3,412 | |
Debt maturing in 2019 | 3,412 | |
Debt maturing in 2020 | 2,500 | |
Debt maturing in 2021 | 157,745 | |
Thereafter | 3,750 | |
Total debt | 173,436 | $ 97,741 |
Revolving Note (U.S. Dollar) | ||
Debt Instrument [Line Items] | ||
Debt maturing in 2021 | 133,875 | |
Total debt | 133,875 | 12,000 |
Revolving Note (Euro) | ||
Debt Instrument [Line Items] | ||
Debt maturing in 2021 | 21,370 | |
Total debt | 21,370 | |
DEG China Loan | ||
Debt Instrument [Line Items] | ||
Debt maturing in 2016 | 456 | |
Debt maturing in 2017 | 911 | |
Debt maturing in 2018 | 912 | |
Debt maturing in 2019 | 912 | |
Total debt | 3,191 | 3,497 |
DEG Vietnam Loan | ||
Debt Instrument [Line Items] | ||
Debt maturing in 2017 | 1,250 | |
Debt maturing in 2018 | 2,500 | |
Debt maturing in 2019 | 2,500 | |
Debt maturing in 2020 | 2,500 | |
Debt maturing in 2021 | 2,500 | |
Thereafter | 3,750 | |
Total debt | $ 15,000 | $ 15,000 |
Derivative Financial Instrume30
Derivative Financial Instruments - Additional Information (Detail) - USD ($) | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Derivative [Line Items] | |||
Maximum length of time to hedge exposure to foreign currency exchange risk | 1 year | ||
Maximum length of time to hedge exposure to price fluctuations in material commodities | 2 years | ||
Foreign Currency Derivatives | |||
Derivative [Line Items] | |||
Notional Value | $ 24,944,000 | $ 0 | |
Commodity Derivatives | |||
Derivative [Line Items] | |||
Notional Value | 4,071,000 | $ 4,885,000 | |
Interest Rate Swap | |||
Derivative [Line Items] | |||
Hedge Ineffectiveness Incurred | $ 0 | $ 0 |
Information Related to Recurrin
Information Related to Recurring Fair Value Measurement of Derivative Instruments in Our Consolidated Condensed Balance Sheet (Detail) - Fair Value, Inputs, Level 2 - Designated as Hedging Instrument $ in Thousands | Mar. 31, 2016USD ($) |
Foreign Currency Derivatives | Current Assets | |
Derivatives Fair Value [Line Items] | |
Asset Derivatives, Fair Value | $ 1,324 |
Net Asset/ (Liabilities) | 1,324 |
Commodity Derivatives | Current Liabilities | |
Derivatives Fair Value [Line Items] | |
Liability Derivatives, Fair value | (429) |
Net Asset/ (Liabilities) | $ (429) |
Information Related to Effect o
Information Related to Effect of Derivative Instruments on Our Consolidated Condensed Statements of Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Derivative Instruments Gain Loss [Line Items] | ||
Gain (loss) on derivatives | $ 1,545 | $ 5,950 |
Commodity Derivatives | ||
Derivative Instruments Gain Loss [Line Items] | ||
Gain (loss) on derivatives | 85 | (7,161) |
Other Comprehensive Income (Loss) | Foreign Currency Derivatives | ||
Derivative Instruments Gain Loss [Line Items] | ||
Gain (loss) on derivatives | 1,293 | (347) |
Other Comprehensive Income (Loss) | Commodity Derivatives | ||
Derivative Instruments Gain Loss [Line Items] | ||
Gain (loss) on derivatives | 296 | |
Revaluation of Derivatives | Foreign Currency Derivatives | ||
Derivative Instruments Gain Loss [Line Items] | ||
Gain (loss) on derivatives | 6,197 | |
Cost of Sales | Foreign Currency Derivatives | ||
Derivative Instruments Gain Loss [Line Items] | ||
Gain (loss) on derivatives | 35 | (128) |
Cost of Sales | Commodity Derivatives | ||
Derivative Instruments Gain Loss [Line Items] | ||
Gain (loss) on derivatives | (211) | (7,161) |
Selling, General and Administrative Expense | Foreign Currency Derivatives | ||
Derivative Instruments Gain Loss [Line Items] | ||
Gain (loss) on derivatives | 139 | 21 |
Foreign Currency (Loss) Gain | Foreign Currency Derivatives | ||
Derivative Instruments Gain Loss [Line Items] | ||
Gain (loss) on derivatives | $ 78 | $ 207 |
Fair Value Measurement - Additi
Fair Value Measurement - Additional Information (Detail) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Financial assets, fair value | $ 0 | $ 0 |
Financial liabilities, fair value | 0 | 0 |
Carrying value | 173,436,000 | 97,741,000 |
Changes to fair value of assets, realized | 0 | 0 |
DEG Vietnam Loan | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying value | 15,000,000 | 15,000,000 |
Fair value | 15,543,000 | 15,056,000 |
DEG China Loan | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying value | 3,191,000 | 3,497,000 |
Fair value | $ 3,782,000 | $ 3,588,000 |
Schedule of Reclassification Ad
Schedule of Reclassification Adjustments and Other Activities Impacting Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Accumulated Other Comprehensive Income Loss [Line Items] | |||
Balance at December 31, 2015 | $ (51,670) | $ (25,743) | |
Other comprehensive income (loss) before reclassifications | 9,317 | (19,886) | |
Income tax effect of other comprehensive income (loss) before reclassifications | 853 | 556 | |
Amounts reclassified from accumulated other comprehensive income (loss) into net income | 182 | 10 | |
Income taxes reclassified into net income | (67) | ||
Other comprehensive income (loss), net of tax | 10,285 | (19,320) | |
Balance at March 31, 2016 | (41,385) | (45,063) | |
Defined Benefit Pension Plans | |||
Accumulated Other Comprehensive Income Loss [Line Items] | |||
Balance at December 31, 2015 | (2,060) | (2,673) | |
Balance at March 31, 2016 | (2,060) | (2,673) | |
Foreign Currency Translation Adjustments | |||
Accumulated Other Comprehensive Income Loss [Line Items] | |||
Balance at December 31, 2015 | (49,381) | (23,060) | |
Other comprehensive income (loss) before reclassifications | 7,910 | (19,605) | |
Income tax effect of other comprehensive income (loss) before reclassifications | 1,242 | 467 | |
Other comprehensive income (loss), net of tax | 9,152 | (19,138) | |
Balance at March 31, 2016 | (40,229) | (42,198) | |
Commodity Hedge Derivatives | |||
Accumulated Other Comprehensive Income Loss [Line Items] | |||
Balance at December 31, 2015 | (229) | ||
Other comprehensive income (loss) before reclassifications | 114 | 76 | |
Income tax effect of other comprehensive income (loss) before reclassifications | (42) | ||
Amounts reclassified from accumulated other comprehensive income (loss) into net income | [1] | 182 | |
Income taxes reclassified into net income | (67) | ||
Other comprehensive income (loss), net of tax | 187 | 76 | |
Balance at March 31, 2016 | (42) | 76 | |
Foreign Currency Hedge Derivatives | |||
Accumulated Other Comprehensive Income Loss [Line Items] | |||
Balance at December 31, 2015 | (10) | ||
Other comprehensive income (loss) before reclassifications | 1,293 | (357) | |
Income tax effect of other comprehensive income (loss) before reclassifications | (347) | 89 | |
Amounts reclassified from accumulated other comprehensive income (loss) into net income | [1] | 10 | |
Other comprehensive income (loss), net of tax | 946 | (258) | |
Balance at March 31, 2016 | $ 946 | $ (268) | |
[1] | The amounts reclassified from accumulated other comprehensive income are included in cost of sales. |