Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 03, 2021 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2021 | |
Entity File Number | 000-26966 | |
Entity Registrant Name | ADVANCED ENERGY INDUSTRIES INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 84-0846841 | |
Entity Address, Address Line One | 1595 Wynkoop Street, Suite 800 | |
Entity Address, City or Town | Denver | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80202 | |
City Area Code | 970 | |
Local Phone Number | 407-6626 | |
Title of 12(b) Security | Common Stock, $0.001 par value | |
Trading Symbol | AEIS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 38,415,537 | |
Entity Central Index Key | 0000927003 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 509,910 | $ 480,368 |
Marketable securities | 2,854 | 2,654 |
Accounts and other receivable, net | 236,916 | 235,178 |
Inventories | 247,567 | 221,346 |
Income taxes receivable | 5,321 | 4,804 |
Other current assets | 37,514 | 35,899 |
Total current assets | 1,040,082 | 980,249 |
Property and equipment, net | 112,842 | 114,731 |
Operating lease right-of-use assets | 100,924 | 103,858 |
Deposits and other assets | 17,740 | 19,101 |
Goodwill | 207,994 | 209,983 |
Intangible assets, net | 169,389 | 168,939 |
Deferred income tax assets | 50,280 | 50,801 |
TOTAL ASSETS | 1,699,251 | 1,647,662 |
Current liabilities: | ||
Accounts payable | 162,616 | 125,224 |
Income taxes payable | 15,586 | 11,850 |
Accrued payroll and employee benefits | 44,611 | 63,487 |
Other accrued expenses | 57,943 | 49,565 |
Customer deposits and other | 13,271 | 12,179 |
Current portion of long-term debt | 17,500 | 17,500 |
Current portion of operating lease liabilities | 15,346 | 16,592 |
Total current liabilities | 326,873 | 296,397 |
Long-term debt | 300,297 | 304,546 |
Operating lease liabilities | 94,184 | 95,993 |
Pension benefits | 78,982 | 80,447 |
Deferred income tax liabilities | 9,672 | 10,088 |
Uncertain tax positions | 12,993 | 12,839 |
Long-term deferred revenue | 7,123 | 7,352 |
Other long-term liabilities | 22,852 | 24,660 |
Total liabilities | 852,976 | 832,322 |
Commitments and contingencies (Note 17) | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value, 1,000 shares authorized, none issued and outstanding | ||
Common stock, $0.001 par value, 70,000 shares authorized; 38,386 and 38,293 issued and outstanding at March 31, 2021 and December 31, 2020, respectively | 38 | 38 |
Additional paid-in capital | 106,065 | 105,009 |
Accumulated other comprehensive loss | (7,573) | (2,605) |
Retained earnings | 747,111 | 712,297 |
Advanced Energy stockholders' equity | 845,641 | 814,739 |
Noncontrolling interest | 634 | 601 |
Total stockholders' equity | 846,275 | 815,340 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 1,699,251 | $ 1,647,662 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Consolidated Balance Sheets | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 1,000 | 1,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 70,000 | 70,000 |
Common stock, shares issued (in shares) | 38,386 | 38,293 |
Common stock, shares outstanding (in shares) | 38,386 | 38,293 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Consolidated Statements of Operations | ||
Sales, net | $ 351,620 | $ 315,456 |
Cost of sales | 214,117 | 203,225 |
Gross profit | 137,503 | 112,231 |
Operating expenses: | ||
Research and development | 40,168 | 34,770 |
Selling, general, and administrative | 46,731 | 45,991 |
Amortization of intangible assets | 5,384 | 5,006 |
Restructuring expense | 1,038 | 656 |
Total operating expenses | 93,321 | 86,423 |
Operating income | 44,182 | 25,808 |
Other income (expense), net | (507) | (3,510) |
Income from continuing operations, before income taxes | 43,675 | 22,298 |
Provision for income taxes | 5,284 | 3,900 |
Income from continuing operations | 38,391 | 18,398 |
Income (loss) from discontinued operations, net of income taxes | 310 | (320) |
Net income | 38,701 | 18,078 |
Income from continuing operations attributable to noncontrolling interest | 33 | 15 |
Net income attributable to Advanced Energy Industries, Inc. | $ 38,668 | $ 18,063 |
Basic weighted-average common shares outstanding | 38,328 | 38,358 |
Diluted weighted-average common shares outstanding | 38,583 | 38,570 |
Earnings per share: | ||
Continuing operations: Basic earnings per share | $ 1 | $ 0.48 |
Continuing operations: Diluted earnings per share | 0.99 | 0.48 |
Discontinued operations: Basic earnings (loss) per share | 0.01 | (0.01) |
Discontinued operations: Diluted earnings (loss) per share | 0.01 | (0.01) |
Net income: | ||
Basic earnings per share | 1.01 | 0.47 |
Diluted earnings per share | $ 1 | $ 0.47 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Consolidated Statements of Comprehensive Income | ||
Net income | $ 38,701 | $ 18,078 |
Other comprehensive income (loss), net of income taxes | ||
Foreign currency translation | (6,941) | (3,061) |
Change in fair value of cash flow hedges | 2,009 | |
Minimum benefit retirement liability | (36) | 154 |
Comprehensive income | 33,733 | 15,171 |
Comprehensive income attributable to noncontrolling interest | 33 | 15 |
Comprehensive income attributable to Advanced Energy Industries, Inc. | $ 33,700 | $ 15,156 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income | Retained EarningsCumulative Effect, Period of Adoption, Adjustment | Retained Earnings | Non-controlling Interest | Cumulative Effect, Period of Adoption, Adjustment | Total |
Beginning Balance at Dec. 31, 2019 | $ 38 | $ 104,849 | $ (5,897) | $ (102) | $ 577,724 | $ 546 | $ (102) | $ 677,260 |
Beginning Balance (in shares) at Dec. 31, 2019 | 38,358 | |||||||
Stock issued from equity plans | (2,171) | (2,171) | ||||||
Stock issued from equity plans (in shares) | 64 | |||||||
Stock-based compensation | 3,048 | 3,048 | ||||||
Stock buyback | (7,248) | (7,248) | ||||||
Stock buyback (in shares) | (170) | |||||||
Other comprehensive income (loss) | (2,907) | (2,907) | ||||||
Net income | 18,063 | 15 | 18,078 | |||||
Ending Balance at Mar. 31, 2020 | $ 38 | 98,478 | (8,804) | 595,685 | 561 | 685,958 | ||
Ending Balance (in shares) at Mar. 31, 2020 | 38,252 | |||||||
Beginning Balance at Dec. 31, 2020 | $ 38 | 105,009 | (2,605) | 712,297 | 601 | $ 815,340 | ||
Beginning Balance (in shares) at Dec. 31, 2020 | 38,293 | 38,293 | ||||||
Stock issued from equity plans | (4,645) | $ (4,645) | ||||||
Stock issued from equity plans (in shares) | 93 | |||||||
Stock-based compensation | 5,701 | 5,701 | ||||||
Dividend payments | (3,854) | (3,854) | ||||||
Other comprehensive income (loss) | (4,968) | (4,968) | ||||||
Net income | 38,668 | 33 | 38,701 | |||||
Ending Balance at Mar. 31, 2021 | $ 38 | $ 106,065 | $ (7,573) | $ 747,111 | $ 634 | $ 846,275 | ||
Ending Balance (in shares) at Mar. 31, 2021 | 38,386 | 38,386 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 38,701 | $ 18,078 |
Income (loss) from discontinued operations, net of income taxes | 310 | (320) |
Income from continuing operations, net of income taxes | 38,391 | 18,398 |
Adjustments to reconcile net income to net cash from operating activities: | ||
Depreciation and amortization | 12,721 | 11,616 |
Stock-based compensation expense | 5,701 | 3,048 |
Provision (benefit) for deferred income taxes | (5) | (1,265) |
Discount on notes receivable | 721 | |
Net loss on disposal of assets | 275 | 173 |
Changes in operating assets and liabilities, net of assets acquired: | ||
Accounts and other receivable, net | (4,984) | 32,084 |
Inventories | (27,503) | (6,726) |
Other assets | (1,406) | (14,688) |
Accounts payable | 40,483 | (5,351) |
Other liabilities and accrued expenses | (12,534) | (9,989) |
Income taxes | 3,125 | 919 |
Net cash from operating activities from continuing operations | 54,264 | 28,940 |
Net cash from operating activities from discontinued operations | (185) | (418) |
Net cash from operating activities | 54,079 | 28,522 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from sale of marketable securities | 10 | |
Issuance of notes receivable | (1,000) | |
Proceeds from sale of property and equipment | 6 | |
Purchases of property and equipment | (8,817) | (6,134) |
Acquisitions, net of cash acquired | (3,604) | |
Net cash from investing activities from continuing operations | (12,415) | (7,124) |
Net cash from investing activities | (12,415) | (7,124) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments on long-term borrowings | (4,375) | (4,375) |
Dividend payments | (3,854) | |
Purchase and retirement of common stock | (7,248) | |
Net payments related to stock-based award activities | (4,214) | (2,171) |
Net cash from financing activities from continuing operations | (12,443) | (13,794) |
Net cash from financing activities | (12,443) | (13,794) |
EFFECT OF CURRENCY TRANSLATION ON CASH | 321 | (1,505) |
NET CHANGE IN CASH AND CASH EQUIVALENTS | 29,542 | 6,099 |
CASH AND CASH EQUIVALENTS, beginning of period | 480,368 | 346,441 |
CASH AND CASH EQUIVALENTS, end of period | 509,910 | 352,540 |
CASH AND CASH EQUIVALENTS FROM CONTINUING OPERATIONS, end of period | 509,910 | 352,540 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||
Cash paid for interest | 979 | 2,240 |
Cash paid for income taxes | 1,873 | 4,545 |
Cash received for refunds of income taxes | $ 109 | $ 121 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2021 | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | NOTE 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Advanced Energy Industries, Inc., a Delaware corporation, and its wholly-owned subsidiaries ("we," "us," "our," "Advanced Energy," or the "Company") design, manufacture, sell, and support precision power products that transform, refine, and modify the raw electrical power from the utility and convert it into various types of highly-controllable usable power that is predictable, repeatable, and customizable. Our power solutions enable innovation in complex semiconductor and thin film plasma processes such as dry etch, strip, chemical and physical deposition, high and low voltage applications such as process control, analytical instrumentation, medical equipment, and in temperature-critical thermal applications such as material and chemical processing. We also supply related instrumentation products for advanced temperature measurement and control, electrostatic instrumentation products for test and measurement applications, and gas sensing and monitoring solutions for several industrial markets. Our network of service support centers facilitates local repair and field service in key regions, provides upgrades and refurbishment services, and sells used equipment to businesses that use our products. In September 2019, we acquired the Artesyn Embedded Power business ("Artesyn"), which added new power products and technologies used in networking and computing, data center including hyperscale, and industrial and medical applications. As of December 31, 2015, we discontinued our engineering, production, and sales of our inverter product line. As such, all inverter product revenues, costs, assets, and liabilities are reported in Discontinued Operations for all periods presented herein, and we currently report as a single unit. Ongoing inverter repair and service operations are reported as part of our continuing operations. In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments, consisting of normal, recurring adjustments, necessary to present fairly the financial position of the Company as of March 31, 2021, and the results of our operations and cash flows for the three months ended March 31, 2021 and 2020. The unaudited consolidated financial statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") have been omitted pursuant to such rules and regulations. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2020 and other financial information filed with the SEC. Use of Estimates in the Preparation of the Consolidated Financial Statements The preparation of our consolidated financial statements in conformity with U.S. GAAP requires us to make estimates, assumptions, and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The significant estimates, assumptions, and judgments include, but are not limited to: ● allowances for expected credit loss; ● excess and obsolete inventory; ● warranty reserves; ● pension obligations; ● right-of-use assets and related operating lease liabilities; ● acquisitions and asset valuations; ● asset lives; ● depreciation and amortization; ● recoverability of assets and potential impairment; ● deferred revenue; ● stock options, performance based stock, and restricted stock grants; and ● taxes and other provisions; We believe our significant estimates, assumptions, and judgments are reasonable based on the information available at the time they are made. Actual results may differ from these estimates, making it possible that a change in these estimates could occur in the near term. Critical Accounting Policies Our accounting policies are described in Note 1 to our audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2020 . New Accounting Standards From time to time, the Financial Accounting Standards Board ("FASB") or other standards setting bodies issue new accounting pronouncements. Updates to the FASB Accounting Standards Codification ("ASC") are communicated through issuance of an Accounting Standards Update ("ASU"). Unless otherwise discussed, we believe that the impact of recently issued guidance, whether adopted or to be adopted in the future, will not have a material impact on the consolidated financial statements upon adoption. New Accounting Standards Adopted In August 2018, the FASB issued ASU 2018-14, ("ASU 2018-14"). ASU 2018-14 eliminates requirements for certain disclosures and requires additional disclosures under defined benefit pension plans and other post-retirement plans. ASU 2018-14 was effective for us on January 1, 2021. The impact of adoption was not material to our consolidated financial statements. New Accounting Standards Issued But Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting" |
ACQUISITIONS
ACQUISITIONS | 3 Months Ended |
Mar. 31, 2021 | |
ACQUISITIONS | |
ACQUISITIONS | NOTE 2. ACQUISITIONS Intangible Assets Acquired In January 2021, we acquired certain intangible assets related to the manufacturing of fiber optic sensing equipment for $3.6 million in cash and an additional $2.9 million expected to be paid within one year of the closing date. These intangible assets have an estimated useful life of five years. See Note 12. Intangible Assets Versatile Power, Inc. On December 31, 2020, we acquired 100% of the issued and outstanding shares of Versatile Power, Inc., which is based in Campbell, California. This acquisition added radio frequency ("RF") and programmable power supplies for medical and industrial applications to our product portfolio and further expands our presence in the medical market by adding proven technologies, deep customer relationships, expertise in medical design, and a medical-certified manufacturing center. The components of the fair value of the total consideration transferred were as follows: Cash paid for acquisition $ 4,594 Holdback 950 Contingent consideration 1,500 Total fair value of consideration transferred 7,044 Less cash acquired (245) Total purchase price $ 6,799 We are still evaluating the fair value for the assets acquired and liabilities assumed. Accordingly, the purchase price allocation presented below is preliminary. Preliminary Current assets and liabilities, net $ 1,013 Property and equipment 35 Operating lease right-of-use assets 463 Intangible assets 4,000 Goodwill 1,751 Total assets acquired 7,262 Operating lease liability 463 Total liabilities assumed 463 Total fair value of net assets acquired $ 6,799 |
REVENUE
REVENUE | 3 Months Ended |
Mar. 31, 2021 | |
REVENUE | |
REVENUE | NOTE 3. REVENUE Revenue Recognition We recognize revenue when we have satisfied our performance obligations which typically occurs when control of the products or services has been transferred to our customers. The transaction price is based upon the standalone selling price. In most transactions, we have no obligations to our customers after the date products are shipped, other than pursuant to warranty obligations. Shipping and handling fees billed to customers, if any, are recognized as revenue. The related shipping and handling costs are recognized in cost of sales. Support services include warranty and non-warranty repair services, upgrades, and refurbishments on the products we sell. Repairs that are covered under our standard warranty do not generate revenue. Nature of goods and services Products Advanced Energy provides highly engineered, mission-critical, precision power conversion, measurement, and control solutions to our global customers. We design, manufacture, sell and support precision power products that transform electrical power into various usable forms. Our power conversion products refine, modify, and control the raw electrical power from a utility and convert it into power that is predictable, repeatable, and customizable. Our products enable thin film manufacturing processes such as plasma enhanced chemical and physical deposition and etch for various semiconductor and industrial products, industrial thermal applications for material and chemical processes, and specialty power for critical industrial technology applications. We also supply thermal instrumentation products for advanced temperature measurement and control in these markets. As a result of the Artesyn acquisition, we now sell precision power conversion products into the Telecom and Networking, Data Center Computing (including hyperscale), and Industrial and Medical markets. Our products are designed to enable new process technologies, improve productivity, and lower the cost of ownership for our customers. We also provide repair and maintenance services for all our products. We principally serve original equipment manufacturers ("OEM") and end customers in the semiconductor, flat panel display, high voltage, solar panel, Telecom and Networking, Data Center Computing, Industrial and Medical markets. Our advanced power products are used in diverse markets, applications, and processes including the manufacture of capital equipment for semiconductor device manufacturing, thin film applications for thin film renewables and architectural glass, and for other thin film applications including flat panel displays, and industrial coatings. Our embedded power products are used in a wide range of applications, such as 5G, data center (including hyperscale) and other industrial and medical applications. Services Our services group offers warranty and after-market repair services in the regions in which we operate, providing us with preventive maintenance opportunities. Our customers continue to pursue low cost of ownership of their capital equipment and are increasingly sensitive to the costs of system downtime. They expect that suppliers offer comprehensive local repair service and customer support. To meet these market requirements, we maintain a worldwide support organization in ten countries, including the United States ("U.S."), the People’s Republic of China ("PRC"), Japan, Korea, Taiwan, Germany, Ireland, Singapore, Israel, and Great Britain. Support services include warranty and non-warranty repair services, upgrades, and refurbishments on the products we sell. As part of our ongoing service business, we satisfy our service obligations under preventative maintenance contracts and extended warranties which had previously been offered on our discontinued inverter products. Any up-front fees received for extended warranties or maintenance plans are deferred. Revenue under these arrangements is recognized ratably over the underlying terms as we do not have historical information which would allow us to project the estimated service usage pattern at this time. The following table summarizes deferred revenue, which relates to extended warranties and service contracts. We expect to recognize this revenue ratably through the year 2031. March 31, December 31, 2021 2020 Deferred revenue $ 8,340 $ 8,671 Disaggregation of Revenue The following tables present additional information regarding our revenue: Three Months Ended March 31, 2021 2020 Semiconductor Equipment $ 180,716 $ 133,625 Industrial and Medical 78,415 61,979 Data Center Computing 59,154 86,183 Telecom and Networking 33,335 33,669 Total $ 351,620 $ 315,456 Three Months Ended March 31, 2021 2020 Product $ 318,879 $ 289,361 Services 32,741 26,095 Total $ 351,620 $ 315,456 Three Months Ended March 31, 2021 2020 United States $ 131,598 $ 116,697 North America (excluding United States) 26,247 47,634 Asia 149,591 110,975 Europe 40,422 39,136 Other 3,762 1,014 Total $ 351,620 $ 315,456 Three Months Ended March 31, 2021 2020 Product and service revenue recognized at point in time $ 351,393 $ 315,281 Extended warranty and service contracts recognized over time 227 175 Total $ 351,620 $ 315,456 |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2021 | |
INCOME TAXES | |
INCOME TAXES | NOTE 4. INCOME TAXES The following table summarizes tax expense and the effective tax rate for our income from continuing operations: Three Months Ended March 31, 2021 2020 Income from continuing operations, before income taxes $ 43,675 $ 22,298 Provision for income taxes $ 5,284 $ 3,900 Effective tax rate 12.1 % 17.5 % The Company’s effective tax rates differ from the U.S. federal statutory rate of 21% for the three months ended March 31, 2021 and 2020, respectively, primarily due to the benefit of earnings in foreign jurisdictions which are subject to lower tax rates, partially offset by net U.S. tax on foreign operations and withholding taxes. The effective tax rate for the first three months of 2021 was lower than the same period in 2020 primarily due to the mix of discrete events between the two periods. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Mar. 31, 2021 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | NOTE 5. EARNINGS PER SHARE Basic earnings per share ("EPS") is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding during the period. The computation of our diluted EPS is similar to the computation of our basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding (using the if-converted and treasury stock methods), if our outstanding stock options and restricted stock units had been converted to common shares, and if such assumed conversion is dilutive. The following is a reconciliation of the weighted-average shares outstanding used in the calculation of basic and diluted earnings per share: Three Months Ended March 31, 2021 2020 Income from continuing operations $ 38,391 $ 18,398 Income from continuing operations attributable to noncontrolling interest 33 15 Income from continuing operations attributable to Advanced Energy Industries, Inc. $ 38,358 $ 18,383 Basic weighted-average common shares outstanding 38,328 38,358 Assumed exercise of dilutive stock options and restricted stock units 255 212 Diluted weighted-average common shares outstanding 38,583 38,570 Continuing operations: Basic earnings per share $ 1.00 $ 0.48 Diluted earnings per share $ 0.99 $ 0.48 The following stock options and restricted units were excluded in the computation of diluted earnings per share because they were anti-dilutive: Three Months Ended March 31, 2021 2020 Restricted stock units 31 — Share Repurchase To execute the repurchase of shares of our common stock, the Company periodically enters into stock repurchase agreements. The following table summarizes these repurchases: Three Months Ended March 31, (in thousands, except per share amounts) 2021 2020 Amount paid to repurchase shares $ — $ 7,248 Number of shares repurchased — 170 Average repurchase price per share $ — $ 42.59 Remaining authorized by Board of Directors for future repurchases as of period end $ 38,369 $ 42,751 There were no shares repurchased from related parties. All shares repurchased were recognized as a reduction to Additional paid-in capital. Repurchased shares were retired and assumed the status of authorized and unissued shares. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2021 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | NOTE 6. FAIR VALUE MEASUREMENTS The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis. March 31, 2021 Description Balance Sheet Classification Level 1 Level 2 Level 3 Total Value Assets: Certificates of deposit Marketable securities $ — $ 2,854 $ — $ 2,854 Foreign currency forward contracts Other current assets — 21 — 21 Total assets measured at fair value on a recurring basis $ — $ 2,875 $ — $ 2,875 Liabilities: Contingent consideration Other current liabilities $ — $ — $ 2,125 $ 2,125 Contingent consideration Other long-term liabilities — — 2,911 2,911 Interest rate swaps Other long-term liabilities — 169 — 169 Total liabilities measured at fair value on a recurring basis $ — $ 169 $ 5,036 $ 5,205 December 31, 2020 Description Balance Sheet Classification Level 1 Level 2 Level 3 Total Value Assets: Certificates of deposit Marketable securities $ — $ 2,654 $ — $ 2,654 Total assets measured at fair value on a recurring basis $ — $ 2,654 $ — $ 2,654 Liabilities: Contingent consideration Other current liabilities $ — $ — $ 2,009 $ 2,009 Contingent consideration Other long-term liabilities — — 2,940 2,940 Interest rate swaps Other long-term liabilities — 2,811 — 2,811 Total liabilities measured at fair value on a recurring basis $ — $ 2,811 $ 4,949 $ 7,760 The fair value of foreign currency forward contracts is based on the movement in the forward rates of foreign currency cash flows in which the hedging instrument is denominated. We determine the fair value of interest rate swaps by estimating the net present value of the expected cash flows based on market rates and associated yield curves, adjusted for non-performance credit risk, as applicable. See Note 7. Derivative Financial Instruments For all periods presented, there were no transfers into or out of Level 3 |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 3 Months Ended |
Mar. 31, 2021 | |
DERIVATIVE FINANCIAL INSTRUMENTS | |
DERIVATIVE FINANCIAL INSTRUMENTS | NOTE 7. DERIVATIVE FINANCIAL INSTRUMENTS We are impacted by changes in foreign currency exchange rates. We may manage these risks through the use of derivative financial instruments, primarily forward contracts with banks. These forward contracts manage the exchange rate risk associated with assets and liabilities denominated in nonfunctional currencies. These derivative instruments are typically executed for one-month periods and not designated as hedges; however, they do economically offset the fluctuations of our assets and liabilities due to foreign exchange rate changes. The following table summarizes the notional amount of outstanding foreign currency forward contracts: March 31, December 31, 2021 2020 Foreign currency forward contracts $ 35,280 $ — Gains and losses related to foreign currency exchange contracts were offset by corresponding gains and losses on the revaluation of the underlying assets and liabilities. Both are included as a component of Other income (expense), net in our Unaudited Consolidated Statements of Operations. In April 2020, the Company executed interest rate swap contracts with independent financial institutions to partially reduce the variability of cash flows in LIBOR indexed debt interest payments on our Term Loan Facility (under the Company’s existing Credit Agreement dated as of September 10, 2019). These transactions are accounted for as cash flow hedging instruments. The interest rate swap contracts fixed 85% of the outstanding principal balance on our term loan to a total interest rate of 1.271%. This is comprised of 0.521% average fixed rate per annum in exchange for a variable interest rate based on one-month USD-LIBOR-BBA plus the credit spread in the Company’s existing Credit Agreement, which is 75 basis points at current leverage ratios. The following table summarizes the notional amount of qualified hedging instruments: March 31, December 31, 2021 2020 Interest rate swap contracts $ 268,844 $ 273,219 At March 31, 2021, Accumulated other comprehensive loss on the Unaudited Consolidated Balance Sheets includes $0.1 million, net of tax, related to changes in fair value on the interest rate swap contracts. See Note 6. Fair Value Measurements As a result of the use of derivative financial instruments, the Company is exposed to the risk that counterparties to derivative contracts may fail to meet their contractual obligations. The Company manages counterparty credit risk in derivative contracts by reviewing counterparty creditworthiness on a regular basis and limiting exposure to any single counterparty. |
ACCOUNTS AND OTHER RECEIVABLE,
ACCOUNTS AND OTHER RECEIVABLE, NET | 3 Months Ended |
Mar. 31, 2021 | |
ACCOUNTS AND OTHER RECEIVABLE, NET | |
ACCOUNTS AND OTHER RECEIVABLE, NET | NOTE 8. ACCOUNTS AND OTHER RECEIVABLE, NET Accounts and other receivable are recorded at net realizable value. Components of accounts and other receivable, net of reserves, were as follows: March 31, December 31, 2021 2020 Amounts billed, net $ 209,956 $ 213,560 Unbilled receivables 26,960 21,618 Total receivables, net $ 236,916 $ 235,178 Amounts billed, net consist of amounts that have been invoiced to our customers in accordance with terms and conditions and are shown net of an allowance for credit losses. These receivables are all short-term in nature and do not include any financing components. Unbilled receivables consist of amounts where we have satisfied our contractual obligations related to inventory stocking contracts with customers. Such amounts typically become billable to the customer upon their consumption of the inventory managed under the stocking contracts. We anticipate that substantially all unbilled receivables will be invoiced and collected over the next twelve months. These contracts do not include any financing components. The following table summarizes the changes in expected credit losses: December 31, 2020 $ 7,602 Additions - Deductions - write-offs, net of recoveries (487) Foreign currency translation (16) March 31, 2021 $ 7,099 |
INVENTORIES
INVENTORIES | 3 Months Ended |
Mar. 31, 2021 | |
INVENTORIES | |
INVENTORIES | NOTE 9. INVENTORIES Our inventories are valued at the lower of cost or net realizable value and computed on a first-in, first-out ("FIFO") basis. Components of inventories were as follows: March 31, December 31, 2021 2020 Parts and raw materials $ 164,316 $ 141,337 Work in process 18,900 13,702 Finished goods 64,351 66,307 Total $ 247,567 $ 221,346 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 3 Months Ended |
Mar. 31, 2021 | |
PROPERTY AND EQUIPMENT, NET | |
PROPERTY AND EQUIPMENT, NET | NOTE 10. PROPERTY AND EQUIPMENT, NET Property and equipment, net is comprised of the following: March 31, December 31, 2021 2020 Buildings and land $ 2,187 $ 1,776 Machinery and equipment 115,496 115,404 Computer and communication equipment 27,472 26,623 Furniture and fixtures 4,384 4,352 Vehicles 261 262 Leasehold improvements 42,331 42,984 Construction in process 5,747 3,693 197,878 195,094 Less: Accumulated depreciation (85,036) (80,363) Property and equipment, net $ 112,842 $ 114,731 The following table summarizes depreciation expense. All depreciation expense is recorded in income from continuing operations: Three Months Ended March 31, 2021 2020 Depreciation expense $ 7,337 $ 6,610 |
GOODWILL
GOODWILL | 3 Months Ended |
Mar. 31, 2021 | |
GOODWILL AND INTANGIBLE ASSETS | |
GOODWILL | NOTE 11. GOODWILL The following table summarizes the changes in goodwill: December 31, 2020 $ 209,983 Measurement period adjustments to purchase price allocation 2 Foreign currency translation (1,991) March 31, 2021 $ 207,994 |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2021 | |
GOODWILL AND INTANGIBLE ASSETS | |
INTANGIBLE ASSETS | NOTE 12. INTANGIBLE ASSETS Intangible assets consisted of the following: March 31, 2021 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Technology $ 90,669 $ (27,386) $ 63,283 Customer relationships 113,426 (28,264) 85,162 Trademarks and other 26,991 (6,047) 20,944 Total $ 231,086 $ (61,697) $ 169,389 December 31, 2020 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Technology $ 85,075 $ (24,999) $ 60,076 Customer relationships 114,171 (26,880) 87,291 Trademarks and other 27,021 (5,449) 21,572 Total $ 226,267 $ (57,328) $ 168,939 Amortization expense related to intangible assets is as follows: Three Months Ended March 31, 2021 2020 Amortization expense $ 5,384 $ 5,006 Estimated amortization expense related to intangibles is as follows: Year Ending December 31, 2021 (remaining) $ 16,263 2022 21,430 2023 21,411 2024 18,526 2025 14,039 Thereafter 77,720 Total $ 169,389 |
RESTRUCTURING COSTS
RESTRUCTURING COSTS | 3 Months Ended |
Mar. 31, 2021 | |
RESTRUCTURING COSTS | |
RESTRUCTURING COSTS | NOTE 13. RESTRUCTURING COSTS During 2018, we committed to a restructuring plan to optimize our manufacturing footprint and to improve our operating efficiencies and synergies related to our recent acquisitions. For the three months ended March 31, 2021, we incurred severance costs primarily related to the transition and exit of our facility in Shenzhen, PRC and actions associated with synergies related to the Artesyn acquisition. The table below summarizes the restructuring charges: Three Months Three Months Ended March 31, Ended March 31, 2021 2020 Severance and related charges $ 404 $ 152 Facility relocation and closure charges 634 504 Total restructuring charges $ 1,038 $ 656 Cumulative Cost Through March 31, 2021 Severance and related charges $ 17,317 Facility relocation and closure charges 6,164 Total restructuring charges $ 23,481 Our restructuring liabilities are included in Other accrued expenses in our Unaudited Consolidated Balance Sheets. Changes in our restructuring liabilities were as follows: Cost Incurred Cost Paid Effect of Balance at and or Changes in Balance at December 31, Charged to Otherwise Exchange March 31, 2020 Expense Settled Rates 2021 Total restructuring liabilities $ 10,641 $ 1,038 $ (512) $ — $ 11,167 The accrued restructuring liabilities related primarily to severance and related charges. |
WARRANTIES
WARRANTIES | 3 Months Ended |
Mar. 31, 2021 | |
WARRANTIES | |
WARRANTIES | NOTE 14. WARRANTIES Provisions of our sales agreements include customary product warranties, generally ranging from 12 months to 24 months after shipment. The estimated cost of our warranty obligation is recorded when revenue is recognized and is based upon our historical experience by product and configuration. Our estimated warranty obligation is included in Other accrued expenses in our Unaudited Consolidated Balance Sheets. Changes in our product warranty obligation were as follows: Three Months Ended March 31, 2021 2020 Balances at beginning of period $ 4,780 $ 6,413 Increases to accruals 780 758 Warranty expenditures (1,051) (856) Effect of changes in exchange rates (5) — Balances at end of period $ 4,504 $ 6,315 |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2021 | |
LEASES | |
LEASES | NOTE 15. LEASES The Company leases manufacturing and office space under non-cancelable operating leases. Some of these leases contain provisions for landlord funded leasehold improvements which are recorded as a reduction to right-of-use ("ROU") assets and the related operating lease liabilities. For leases containing an option to renew, we regularly evaluate the renewal options and when they are reasonably certain of exercise, we include the renewal period in our lease terms, along with the ROU assets and operating lease liabilities. In many cases, we have lease terms that are less than one year and therefore, we have elected the practical expedient to exclude these short-term leases from our ROU assets and operating lease liabilities. New leases are negotiated and executed to meet business objectives on an on-going basis. Our leases do not provide an implicit rate. Accordingly, we use our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. We have a centrally managed treasury function; therefore, we apply a portfolio approach for determining the incremental borrowing rate applicable to the lease term. Components of operating lease cost were as follows: Three Months Ended March 31, 2021 2020 Operating lease cost $ 5,921 $ 4,834 Short-term and variable lease cost 842 1,308 Total operating lease cost $ 6,763 $ 6,142 Maturities of our operating lease liabilities at March 31, 2021 are as follows: Year Ending December 31, 2021 (remaining) $ 15,482 2022 16,723 2023 13,503 2024 12,120 2025 10,664 Thereafter 74,413 Total lease payments 142,905 Less: Interest (33,375) Present value of lease liabilities $ 109,530 Other information related to leases, including supplemental cash flow information, consists of: Three Months Ended March 31, 2021 2020 Weighted average remaining lease term (in years) 10.6 9.7 Weighted average discount rate 4.6 % 4.3 % Cash paid for operating leases $ 5,958 $ 5,574 Right-of-use assets obtained in exchange for operating lease liabilities $ 2,192 $ 22,208 |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2021 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | NOTE 16. STOCK-BASED COMPENSATION On May 4, 2017, the stockholders approved the Company’s 2017 Omnibus Incentive Plan ("the 2017 Plan"), and all shares that were then available for issuance under the 2008 Omnibus Incentive Plan are now available for issuance under the 2017 Plan. The 2017 Plan and 2008 Plan provide for the grant of stock options, stock appreciation rights, restricted stock, stock units (including deferred stock units), unrestricted stock, and dividend equivalent rights. Any of the awards issued may be issued as performance-based awards to align stock compensation awards to the attainment of annual or long-term performance goals. As of March 31, 2021, there were 2.0 million shares available for grant under the 2017 Plan. Restricted stock units ("RSU’s") are generally granted with a grant date fair value equal to the market price of our stock on the date of grant and with generally a three Stock option awards are generally granted with an exercise price equal to the market price of our stock on the date of grant and with either a three We recognize stock-based compensation expense based on the fair value of the awards issued and the functional area of the employee receiving the award. Stock-based compensation was as follows: Three Months Ended March 31, 2021 2020 Stock-based compensation expense $ 5,701 $ 3,048 Changes in our RSUs were as follows: Three Months Ended March 31, 2021 Weighted- Average Number of Grant Date RSUs Fair Value RSUs outstanding at beginning of period 608 $ 58.15 RSUs granted 227 $ 93.93 RSUs vested (125) $ 58.18 RSUs forfeited (110) $ 65.70 RSUs outstanding at end of period 600 $ 70.37 Changes in our stock options were as follows: Three Months Ended March 31, 2021 Weighted- Average Number of Exercise Price Options per Share Options outstanding at beginning of period 147 $ 23.63 Options exercised (13) $ 20.52 Options expired — $ Options outstanding at end of period 134 $ 23.92 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2021 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 17. COMMITMENTS AND CONTINGENCIES We are involved in disputes and legal actions arising in the normal course of our business. While we currently believe that the amount of any ultimate loss would not be material to our financial position, the outcome of these actions is inherently difficult to predict. In the event of an adverse outcome, the ultimate loss could have a material adverse effect on our financial position or reported results of operations. An unfavorable decision in patent litigation also could require material changes in production processes and products or result in our inability to ship products or components found to have violated third-party patent rights. We accrue loss contingencies in connection with our commitments and contingencies, including litigation, when it is probable that a loss has occurred, and the amount of the loss can be reasonably estimated. The Company is not currently party to any legal action that the Company believes would reasonably have a material adverse impact on its business, financial condition, results of operations or cash flows. |
SIGNIFICANT CUSTOMER INFORMATIO
SIGNIFICANT CUSTOMER INFORMATION | 3 Months Ended |
Mar. 31, 2021 | |
SIGNIFICANT CUSTOMER INFORMATION | |
SIGNIFICANT CUSTOMER INFORMATION | NOTE 18. SIGNIFICANT CUSTOMER INFORMATION The following table summarizes sales, and percentages of sales, by customers that individually accounted for 10% or more of our sales: Three Months Ended March 31, 2021 2020 Applied Materials, Inc. $ 67,788 19.3 % $ 50,981 16.2 % Lam Research * * % 32,996 10.5 % The following table summarizes the accounts receivable balances, and percentages of the total accounts receivable, for customers that individually accounted for 10% or more of accounts receivable: March 31, December 31, 2021 2020 Applied Materials, Inc. $ 40,357 17.0 % $ 33,402 14.2 % Nidec Motor Corporation * * % 24,344 10.4 % * Customer’s balance was less than 10% of total. Our sales to Applied Materials, Inc. and Lam Research include precision power products used in semiconductor processing and solar and flat panel display. Our sales to Nidec Motor Corporation are primarily embedded power products used in industrial motor drives. No other customer accounted for 10% or more of our sales or accounts receivable balances during these periods. |
CREDIT FACILITY
CREDIT FACILITY | 3 Months Ended |
Mar. 31, 2021 | |
CREDIT FACILITY | |
CREDIT FACILITY | NOTE 19. CREDIT FACILITY In September 2019, in connection with the Artesyn Acquisition Agreement, the Company entered into a credit agreement ("Credit Agreement") that provided aggregate financing of $500.0 million, consisting of a $350.0 million senior unsecured term loan facility (the "Term Loan Facility") and a $150.0 million senior unsecured revolving facility the ("Revolving Facility" and together with the Term Loan Facility, the "Credit Facility"). Both the Term Loan Facility and Revolving Facility mature on September 10, 2024. The following table summarizes borrowings under our Credit Facility and the associated interest rate. March 31, 2021 Balance Interest Rate Unused Line Fee Term Loan Facility subject to a fixed interest rate $ 268,844 1.271% - Term Loan Facility subject to a variable interest rate 50,531 0.910% - Revolving Facility subject to a variable rate — 0.910% 0.10% Total borrowings under the Credit Agreement $ 319,375 For more information on the interest rate swap that fixes the interest rate for a portion of our Term Loan Facility, see Note 7. Derivative Financial Instruments For all periods presented, we were in compliance with the Credit Agreement covenants and had $150.0 million available to withdraw on the Revolving Facility. We classify the Credit Facility in Level 2 of the fair value hierarchy. The fair value of outstanding The debt obligation on our Unaudited Consolidated Balance Sheets consists of the following: March 31, December 31, 2021 2020 Term Loan Facility $ 319,375 $ 323,750 Less: debt issuance costs (1,578) (1,704) Total debt 317,797 322,046 Less current portion of long-term debt (17,500) (17,500) Total long-term debt $ 300,297 $ 304,546 Contractual maturities of the Company’s debt obligations, excluding amortization of debt issuance costs, as of March 31, 2021 are as follows: Year Ending December 31, 2021 (remaining) $ 13,125 2022 17,500 2023 17,500 2024 271,250 Total $ 319,375 Interest expense and unused line of credit fees were recorded in Other income (expense), net in our Unaudited Consolidated Statements of Operations as follows: Three Months Ended March 31, 2021 2020 Interest expense $ 985 $ 2,099 Amortization of debt issuance costs 126 133 Unused line of credit fees and other 37 38 Total interest expense $ 1,148 $ 2,270 |
DESCRIPTION OF BUSINESS AND B_2
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |
Use of Estimates in the Preparation of the Consolidated Financial Statements | Use of Estimates in the Preparation of the Consolidated Financial Statements The preparation of our consolidated financial statements in conformity with U.S. GAAP requires us to make estimates, assumptions, and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The significant estimates, assumptions, and judgments include, but are not limited to: ● allowances for expected credit loss; ● excess and obsolete inventory; ● warranty reserves; ● pension obligations; ● right-of-use assets and related operating lease liabilities; ● acquisitions and asset valuations; ● asset lives; ● depreciation and amortization; ● recoverability of assets and potential impairment; ● deferred revenue; ● stock options, performance based stock, and restricted stock grants; and ● taxes and other provisions; We believe our significant estimates, assumptions, and judgments are reasonable based on the information available at the time they are made. Actual results may differ from these estimates, making it possible that a change in these estimates could occur in the near term. |
Critical Accounting Policies | Critical Accounting Policies Our accounting policies are described in Note 1 to our audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2020 . |
New Accounting Standards | New Accounting Standards From time to time, the Financial Accounting Standards Board ("FASB") or other standards setting bodies issue new accounting pronouncements. Updates to the FASB Accounting Standards Codification ("ASC") are communicated through issuance of an Accounting Standards Update ("ASU"). Unless otherwise discussed, we believe that the impact of recently issued guidance, whether adopted or to be adopted in the future, will not have a material impact on the consolidated financial statements upon adoption. New Accounting Standards Adopted In August 2018, the FASB issued ASU 2018-14, ("ASU 2018-14"). ASU 2018-14 eliminates requirements for certain disclosures and requires additional disclosures under defined benefit pension plans and other post-retirement plans. ASU 2018-14 was effective for us on January 1, 2021. The impact of adoption was not material to our consolidated financial statements. New Accounting Standards Issued But Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting" |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
ACQUISITIONS | |
Schedule of components of fair value of total consideration transferred | Cash paid for acquisition $ 4,594 Holdback 950 Contingent consideration 1,500 Total fair value of consideration transferred 7,044 Less cash acquired (245) Total purchase price $ 6,799 |
Schedule of fair value of assets acquired and liabilities assumed | Preliminary Current assets and liabilities, net $ 1,013 Property and equipment 35 Operating lease right-of-use assets 463 Intangible assets 4,000 Goodwill 1,751 Total assets acquired 7,262 Operating lease liability 463 Total liabilities assumed 463 Total fair value of net assets acquired $ 6,799 |
REVENUE (Tables)
REVENUE (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
REVENUE | |
Summary of deferred revenue, | March 31, December 31, 2021 2020 Deferred revenue $ 8,340 $ 8,671 |
Schedule of disaggregation of revenue | Three Months Ended March 31, 2021 2020 Semiconductor Equipment $ 180,716 $ 133,625 Industrial and Medical 78,415 61,979 Data Center Computing 59,154 86,183 Telecom and Networking 33,335 33,669 Total $ 351,620 $ 315,456 Three Months Ended March 31, 2021 2020 Product $ 318,879 $ 289,361 Services 32,741 26,095 Total $ 351,620 $ 315,456 Three Months Ended March 31, 2021 2020 United States $ 131,598 $ 116,697 North America (excluding United States) 26,247 47,634 Asia 149,591 110,975 Europe 40,422 39,136 Other 3,762 1,014 Total $ 351,620 $ 315,456 Three Months Ended March 31, 2021 2020 Product and service revenue recognized at point in time $ 351,393 $ 315,281 Extended warranty and service contracts recognized over time 227 175 Total $ 351,620 $ 315,456 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
INCOME TAXES | |
Schedule of tax expense and the effective tax rate for income from continuing operations | Three Months Ended March 31, 2021 2020 Income from continuing operations, before income taxes $ 43,675 $ 22,298 Provision for income taxes $ 5,284 $ 3,900 Effective tax rate 12.1 % 17.5 % |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
EARNINGS PER SHARE | |
Reconciliation of weighted-average shares outstanding used in calculation of basic and diluted EPS | Three Months Ended March 31, 2021 2020 Income from continuing operations $ 38,391 $ 18,398 Income from continuing operations attributable to noncontrolling interest 33 15 Income from continuing operations attributable to Advanced Energy Industries, Inc. $ 38,358 $ 18,383 Basic weighted-average common shares outstanding 38,328 38,358 Assumed exercise of dilutive stock options and restricted stock units 255 212 Diluted weighted-average common shares outstanding 38,583 38,570 Continuing operations: Basic earnings per share $ 1.00 $ 0.48 Diluted earnings per share $ 0.99 $ 0.48 |
Schedule of stock options and restricted units excluded in computation of diluted EPS | Three Months Ended March 31, 2021 2020 Restricted stock units 31 — |
Schedule of repurchase of shares of common stock | Three Months Ended March 31, (in thousands, except per share amounts) 2021 2020 Amount paid to repurchase shares $ — $ 7,248 Number of shares repurchased — 170 Average repurchase price per share $ — $ 42.59 Remaining authorized by Board of Directors for future repurchases as of period end $ 38,369 $ 42,751 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
FAIR VALUE MEASUREMENTS | |
Schedule of assets and liabilities measured at fair value on a recurring basis | The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis. March 31, 2021 Description Balance Sheet Classification Level 1 Level 2 Level 3 Total Value Assets: Certificates of deposit Marketable securities $ — $ 2,854 $ — $ 2,854 Foreign currency forward contracts Other current assets — 21 — 21 Total assets measured at fair value on a recurring basis $ — $ 2,875 $ — $ 2,875 Liabilities: Contingent consideration Other current liabilities $ — $ — $ 2,125 $ 2,125 Contingent consideration Other long-term liabilities — — 2,911 2,911 Interest rate swaps Other long-term liabilities — 169 — 169 Total liabilities measured at fair value on a recurring basis $ — $ 169 $ 5,036 $ 5,205 December 31, 2020 Description Balance Sheet Classification Level 1 Level 2 Level 3 Total Value Assets: Certificates of deposit Marketable securities $ — $ 2,654 $ — $ 2,654 Total assets measured at fair value on a recurring basis $ — $ 2,654 $ — $ 2,654 Liabilities: Contingent consideration Other current liabilities $ — $ — $ 2,009 $ 2,009 Contingent consideration Other long-term liabilities — — 2,940 2,940 Interest rate swaps Other long-term liabilities — 2,811 — 2,811 Total liabilities measured at fair value on a recurring basis $ — $ 2,811 $ 4,949 $ 7,760 |
DERIVATIVE FINANCIAL INSTRUME_2
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
DERIVATIVE FINANCIAL INSTRUMENTS | |
Schedule of notional amount of outstanding foreign currency forward contracts | The following table summarizes the notional amount of outstanding foreign currency forward contracts: March 31, December 31, 2021 2020 Foreign currency forward contracts $ 35,280 $ — |
Schedule of notional amount of qualified hedging instruments | The following table summarizes the notional amount of qualified hedging instruments: March 31, December 31, 2021 2020 Interest rate swap contracts $ 268,844 $ 273,219 |
ACCOUNTS AND OTHER RECEIVABLE_2
ACCOUNTS AND OTHER RECEIVABLE, NET (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
ACCOUNTS AND OTHER RECEIVABLE, NET | |
Schedule of accounts and other receivable | March 31, December 31, 2021 2020 Amounts billed, net $ 209,956 $ 213,560 Unbilled receivables 26,960 21,618 Total receivables, net $ 236,916 $ 235,178 |
Schedule of expected credit losses | December 31, 2020 $ 7,602 Additions - Deductions - write-offs, net of recoveries (487) Foreign currency translation (16) March 31, 2021 $ 7,099 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
INVENTORIES | |
Schedule of components of inventories | March 31, December 31, 2021 2020 Parts and raw materials $ 164,316 $ 141,337 Work in process 18,900 13,702 Finished goods 64,351 66,307 Total $ 247,567 $ 221,346 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
PROPERTY AND EQUIPMENT, NET | |
Schedule of details of property and equipment | March 31, December 31, 2021 2020 Buildings and land $ 2,187 $ 1,776 Machinery and equipment 115,496 115,404 Computer and communication equipment 27,472 26,623 Furniture and fixtures 4,384 4,352 Vehicles 261 262 Leasehold improvements 42,331 42,984 Construction in process 5,747 3,693 197,878 195,094 Less: Accumulated depreciation (85,036) (80,363) Property and equipment, net $ 112,842 $ 114,731 |
Schedule of depreciation expense recorded in continuing operations | The following table summarizes depreciation expense. All depreciation expense is recorded in income from continuing operations: Three Months Ended March 31, 2021 2020 Depreciation expense $ 7,337 $ 6,610 |
GOODWILL (Tables)
GOODWILL (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
GOODWILL AND INTANGIBLE ASSETS | |
Schedule of changes in goodwill | December 31, 2020 $ 209,983 Measurement period adjustments to purchase price allocation 2 Foreign currency translation (1,991) March 31, 2021 $ 207,994 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
GOODWILL AND INTANGIBLE ASSETS | |
Schedule of intangible assets | March 31, 2021 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Technology $ 90,669 $ (27,386) $ 63,283 Customer relationships 113,426 (28,264) 85,162 Trademarks and other 26,991 (6,047) 20,944 Total $ 231,086 $ (61,697) $ 169,389 December 31, 2020 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Technology $ 85,075 $ (24,999) $ 60,076 Customer relationships 114,171 (26,880) 87,291 Trademarks and other 27,021 (5,449) 21,572 Total $ 226,267 $ (57,328) $ 168,939 |
Schedule of amortization expense related to intangible assets | Three Months Ended March 31, 2021 2020 Amortization expense $ 5,384 $ 5,006 |
Schedule of estimated amortization expense related to intangible assets | Year Ending December 31, 2021 (remaining) $ 16,263 2022 21,430 2023 21,411 2024 18,526 2025 14,039 Thereafter 77,720 Total $ 169,389 |
RESTRUCTURING COSTS (Tables)
RESTRUCTURING COSTS (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
RESTRUCTURING COSTS | |
Schedule of restructuring charges | Three Months Three Months Ended March 31, Ended March 31, 2021 2020 Severance and related charges $ 404 $ 152 Facility relocation and closure charges 634 504 Total restructuring charges $ 1,038 $ 656 Cumulative Cost Through March 31, 2021 Severance and related charges $ 17,317 Facility relocation and closure charges 6,164 Total restructuring charges $ 23,481 |
Schedule of restructuring liabilities | Cost Incurred Cost Paid Effect of Balance at and or Changes in Balance at December 31, Charged to Otherwise Exchange March 31, 2020 Expense Settled Rates 2021 Total restructuring liabilities $ 10,641 $ 1,038 $ (512) $ — $ 11,167 |
WARRANTIES (Tables)
WARRANTIES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
WARRANTIES | |
Schedule of changes in accrued product warranties | Three Months Ended March 31, 2021 2020 Balances at beginning of period $ 4,780 $ 6,413 Increases to accruals 780 758 Warranty expenditures (1,051) (856) Effect of changes in exchange rates (5) — Balances at end of period $ 4,504 $ 6,315 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
LEASES | |
Components of operating lease cost | Three Months Ended March 31, 2021 2020 Operating lease cost $ 5,921 $ 4,834 Short-term and variable lease cost 842 1,308 Total operating lease cost $ 6,763 $ 6,142 |
Schedule of maturities of operating lease liabilities | Year Ending December 31, 2021 (remaining) $ 15,482 2022 16,723 2023 13,503 2024 12,120 2025 10,664 Thereafter 74,413 Total lease payments 142,905 Less: Interest (33,375) Present value of lease liabilities $ 109,530 |
Schedule of other information related to leases | Three Months Ended March 31, 2021 2020 Weighted average remaining lease term (in years) 10.6 9.7 Weighted average discount rate 4.6 % 4.3 % Cash paid for operating leases $ 5,958 $ 5,574 Right-of-use assets obtained in exchange for operating lease liabilities $ 2,192 $ 22,208 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of stock-based compensation | Three Months Ended March 31, 2021 2020 Stock-based compensation expense $ 5,701 $ 3,048 |
Summary of stock option activity | Three Months Ended March 31, 2021 Weighted- Average Number of Grant Date RSUs Fair Value RSUs outstanding at beginning of period 608 $ 58.15 RSUs granted 227 $ 93.93 RSUs vested (125) $ 58.18 RSUs forfeited (110) $ 65.70 RSUs outstanding at end of period 600 $ 70.37 |
Restricted Stock Units (RSUs) [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of stock option activity | Three Months Ended March 31, 2021 Weighted- Average Number of Exercise Price Options per Share Options outstanding at beginning of period 147 $ 23.63 Options exercised (13) $ 20.52 Options expired — $ Options outstanding at end of period 134 $ 23.92 |
SIGNIFICANT CUSTOMER INFORMAT_2
SIGNIFICANT CUSTOMER INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
SIGNIFICANT CUSTOMER INFORMATION | |
Schedule of revenue by major customers by reporting segments | Three Months Ended March 31, 2021 2020 Applied Materials, Inc. $ 67,788 19.3 % $ 50,981 16.2 % Lam Research * * % 32,996 10.5 % March 31, December 31, 2021 2020 Applied Materials, Inc. $ 40,357 17.0 % $ 33,402 14.2 % Nidec Motor Corporation * * % 24,344 10.4 % |
CREDIT FACILITY (Tables)
CREDIT FACILITY (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
CREDIT FACILITY | |
Schedule of short-term debt obligation | March 31, 2021 Balance Interest Rate Unused Line Fee Term Loan Facility subject to a fixed interest rate $ 268,844 1.271% - Term Loan Facility subject to a variable interest rate 50,531 0.910% - Revolving Facility subject to a variable rate — 0.910% 0.10% Total borrowings under the Credit Agreement $ 319,375 For more information on the interest rate swap that fixes the interest rate for a portion of our Term Loan Facility, see Note 7. Derivative Financial Instruments |
Schedule of debt obligation | March 31, December 31, 2021 2020 Term Loan Facility $ 319,375 $ 323,750 Less: debt issuance costs (1,578) (1,704) Total debt 317,797 322,046 Less current portion of long-term debt (17,500) (17,500) Total long-term debt $ 300,297 $ 304,546 |
Schedule of contractual maturities of debt obligations | Year Ending December 31, 2021 (remaining) $ 13,125 2022 17,500 2023 17,500 2024 271,250 Total $ 319,375 |
Schedule of interest expense and unused line of credit fees | Three Months Ended March 31, 2021 2020 Interest expense $ 985 $ 2,099 Amortization of debt issuance costs 126 133 Unused line of credit fees and other 37 38 Total interest expense $ 1,148 $ 2,270 |
ACQUISITIONS - Intangible Asset
ACQUISITIONS - Intangible Assets Acquired (Details) - Technology Equipment [Member] $ in Millions | 1 Months Ended |
Jan. 31, 2021USD ($) | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Intangible assets acquired | $ 3.6 |
Contingent consideration | $ 2.9 |
Useful Life | 5 years |
ACQUISITIONS - Consideration Tr
ACQUISITIONS - Consideration Transferred (Details) - Versatile Power, Inc. [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Business Acquisition [Line Items] | |
Acquired percentage | 100.00% |
Cash paid for acquisition | $ 4,594 |
Holdback | 950 |
Contingent consideration | 1,500 |
Total fair value of consideration transferred | 7,044 |
Less cash acquired | (245) |
Total purchase price | $ 6,799 |
ACQUISITIONS - Assets Acquired
ACQUISITIONS - Assets Acquired and Liabilities Assumed (Details) - Versatile Power, Inc. [Member] - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||
Total fair value of net assets acquired | $ 6,799 | |
Preliminary Fair Value [Member] | ||
Business Acquisition [Line Items] | ||
Current assets and liabilities, net | $ 1,013 | |
Property and equipment | 35 | |
Operating lease right-of-use assets | 463 | |
Intangible assets | 4,000 | |
Goodwill | 1,751 | |
Total assets acquired | 7,262 | |
Operating lease liability | 463 | |
Total liabilities assumed | 463 | |
Total fair value of net assets acquired | $ 6,799 |
REVENUE - Nature of Goods and S
REVENUE - Nature of Goods and Services (Details) $ in Thousands | Mar. 31, 2021USD ($)country | Dec. 31, 2020USD ($) |
REVENUE | ||
Worldwide support organization maintained in number of countries | country | 10 | |
Deferred revenue | $ | $ 8,340 | $ 8,671 |
REVENUE - Revenue by Product Li
REVENUE - Revenue by Product Line (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 351,620 | $ 315,456 |
United States [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 131,598 | 116,697 |
North America [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 26,247 | 47,634 |
Asia [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 149,591 | 110,975 |
Europe [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 40,422 | 39,136 |
Other countries [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 3,762 | 1,014 |
Semiconductor Equipment [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 180,716 | 133,625 |
Industrial and Medical [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 78,415 | 61,979 |
Data Center Computing [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 59,154 | 86,183 |
Telecom and Networking [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 33,335 | 33,669 |
Product [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 318,879 | 289,361 |
Services [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 32,741 | $ 26,095 |
REVENUE - Extended Warranty Rev
REVENUE - Extended Warranty Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 351,620 | $ 315,456 |
Recognized at Point in Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 351,393 | 315,281 |
Recognized over Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 227 | $ 175 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
INCOME TAXES | ||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% |
INCOME TAXES - Schedule of tax
INCOME TAXES - Schedule of tax expense and effective tax rate for income from continuing operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
INCOME TAXES | ||
Income from continuing operations, before income taxes | $ 43,675 | $ 22,298 |
Provision for income taxes | $ 5,284 | $ 3,900 |
Effective tax rate | 12.10% | 17.50% |
EARNINGS PER SHARE - Reconcilia
EARNINGS PER SHARE - Reconciliation of weighted-average shares outstanding used in calculation of basic and diluted EPS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
EARNINGS PER SHARE | ||
Income from continuing operations | $ 38,391 | $ 18,398 |
Income from continuing operations attributable to noncontrolling interest | 33 | 15 |
Income from continuing operations attributable to Advanced Energy Industries, Inc. | $ 38,358 | $ 18,383 |
Basic weighted-average common shares outstanding | 38,328 | 38,358 |
Assumed exercise of dilutive stock options and restricted stock units | 255 | 212 |
Diluted weighted-average common shares outstanding | 38,583 | 38,570 |
Continuing Operations: | ||
Basic earnings per share | $ 1 | $ 0.48 |
Diluted earnings per share | $ 0.99 | $ 0.48 |
EARNINGS PER SHARE - Schedule o
EARNINGS PER SHARE - Schedule of stock options and restricted units excluded in the computation of diluted earnings per share (Details) shares in Thousands | 3 Months Ended |
Mar. 31, 2021shares | |
Restricted Stock Units (RSUs) [Member] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Stock options and restricted units excluded from the computation of diluted earnings per share because they were anti-dilutive | 31 |
EARNINGS PER SHARE - Stock Buyb
EARNINGS PER SHARE - Stock Buyback (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
EARNINGS PER SHARE | ||
Amount paid to repurchase shares | $ 7,248 | |
Number of shares repurchased | 170,000 | |
Average repurchase price per share | $ 42.59 | |
Remaining authorized by Board of Directors for future repurchases as of period end | $ 38,369 | $ 42,751 |
Shares repurchased from related parties | 0 |
FAIR VALUE MEASUREMENTS - Asset
FAIR VALUE MEASUREMENTS - Assets and Liabilities Measured at Fair Value (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | $ 2,875 | $ 2,654 |
Total liabilities | 5,205 | 7,760 |
Contingent Consideration [Member] | Other Current Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | 2,125 | 2,009 |
Contingent Consideration [Member] | Other Long-Term Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | 2,911 | 2,940 |
Interest Rate Swap [Member] | Other Long-Term Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | 169 | 2,811 |
Certificates of Deposit [Member] | Marketable Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 2,854 | 2,654 |
Foreign Exchange Forward [Member] | Other Current Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 21 | |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 2,875 | 2,654 |
Total liabilities | 169 | 2,811 |
Fair Value, Inputs, Level 2 [Member] | Interest Rate Swap [Member] | Other Long-Term Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | 169 | 2,811 |
Fair Value, Inputs, Level 2 [Member] | Certificates of Deposit [Member] | Marketable Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 2,854 | 2,654 |
Fair Value, Inputs, Level 2 [Member] | Foreign Exchange Forward [Member] | Other Current Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 21 | |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | 5,036 | 4,949 |
Fair Value, Inputs, Level 3 [Member] | Contingent Consideration [Member] | Other Current Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | 2,125 | 2,009 |
Fair Value, Inputs, Level 3 [Member] | Contingent Consideration [Member] | Other Long-Term Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | $ 2,911 | $ 2,940 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
FAIR VALUE MEASUREMENTS | |
Transfers from level 1 to level 2, Assets | $ 0 |
Transfers from level 1 to level 2, Liabilities | 0 |
Transfers from level 2 to level 1, Assets | 0 |
Transfers from level 2 to level 1, Liabilities | 0 |
Transfer into Level 3, Liabilities | 0 |
Transfer from Level 3, Liabilities | 0 |
Transfer into Level 3, Assets | 0 |
Transfer from Level 3, Assets | $ 0 |
DERIVATIVE FINANCIAL INSTRUME_3
DERIVATIVE FINANCIAL INSTRUMENTS (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Loan value, percentage | 85.00% |
Annual interest (as a percent) | 1.271% |
Average fixed rate | 0.521% |
Cash Flow Hedge | Designated as Hedging Instrument [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Basis points at current leverage ratios | 75 |
Foreign Exchange Forward [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Derivative, notional amount | $ 35,280 |
DERIVATIVE FINANCIAL INSTRUME_4
DERIVATIVE FINANCIAL INSTRUMENTS - Qualified Hedging Instruments (Details) - Interest Rate Swap [Member] - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Derivative [Line Items] | ||
Derivative, notional amount | $ 268,844 | $ 273,219 |
Changes in fair value on the interest rate swaps | $ 100 |
ACCOUNTS AND OTHER RECEIVABLE_3
ACCOUNTS AND OTHER RECEIVABLE, NET (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total receivables, net | $ 236,916 | $ 235,178 |
Amounts billed, net | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total receivables, net | 209,956 | 213,560 |
Unbilled receivables | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total receivables, net | $ 26,960 | $ 21,618 |
ACCOUNTS AND OTHER RECEIVABLE_4
ACCOUNTS AND OTHER RECEIVABLE, NET - Expected Credit losses - (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
ACCOUNTS AND OTHER RECEIVABLE, NET | |
Balance as of beginning of period | $ 7,602 |
Deductions - write-offs, net of recoveries | (487) |
Foreign currency translation | (16) |
Balance as of end of period | $ 7,099 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
INVENTORIES | ||
Parts and raw materials | $ 164,316 | $ 141,337 |
Work in process | 18,900 | 13,702 |
Finished goods | 64,351 | 66,307 |
Total | $ 247,567 | $ 221,346 |
PROPERTY AND EQUIPMENT, NET - D
PROPERTY AND EQUIPMENT, NET - Details of property and equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 197,878 | $ 195,094 |
Less: Accumulated depreciation | (85,036) | (80,363) |
Property and equipment, net | 112,842 | 114,731 |
Buildings and Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 2,187 | 1,776 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 115,496 | 115,404 |
Computer and Communication Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 27,472 | 26,623 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 4,384 | 4,352 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 261 | 262 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 42,331 | 42,984 |
Construction in Process [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 5,747 | $ 3,693 |
PROPERTY AND EQUIPMENT, NET -_2
PROPERTY AND EQUIPMENT, NET - Depreciation expense recorded in continuing operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
PROPERTY AND EQUIPMENT, NET | ||
Depreciation expense | $ 7,337 | $ 6,610 |
GOODWILL - Schedule of the chan
GOODWILL - Schedule of the changes in goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
GOODWILL AND INTANGIBLE ASSETS | |
Balance as of Beginning of Period | $ 209,983 |
Measurement period adjustments to preliminary purchase price allocation | 2 |
Foreign currency translation | (1,991) |
Balance as of End of Period | $ 207,994 |
INTANGIBLE ASSETS - Schedule of
INTANGIBLE ASSETS - Schedule of intangible assets (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | $ 231,086 | $ 226,267 |
Finite-Lived Intangible Assets, Accumulated Amortization | (61,697) | (57,328) |
Finite-lived intangible assets, net | 169,389 | 168,939 |
Technology Equipment [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 90,669 | 85,075 |
Finite-Lived Intangible Assets, Accumulated Amortization | (27,386) | (24,999) |
Finite-lived intangible assets, net | 63,283 | 60,076 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 113,426 | 114,171 |
Finite-Lived Intangible Assets, Accumulated Amortization | (28,264) | (26,880) |
Finite-lived intangible assets, net | 85,162 | 87,291 |
Trademarks and other [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 26,991 | 27,021 |
Finite-Lived Intangible Assets, Accumulated Amortization | (6,047) | (5,449) |
Finite-lived intangible assets, net | $ 20,944 | $ 21,572 |
INTANGIBLE ASSETS - Schedule _2
INTANGIBLE ASSETS - Schedule of amortization expense relating to intangible assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
GOODWILL AND INTANGIBLE ASSETS | ||
Amortization expense | $ 5,384 | $ 5,006 |
INTANGIBLE ASSETS - Schedule _3
INTANGIBLE ASSETS - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
GOODWILL AND INTANGIBLE ASSETS | ||
2021 (remaining) | $ 16,263 | |
2022 | 21,430 | |
2023 | 21,411 | |
2024 | 18,526 | |
2025 | 14,039 | |
Thereafter | 77,720 | |
Finite-lived intangible assets, net | $ 169,389 | $ 168,939 |
RESTRUCTURING COSTS (Details)
RESTRUCTURING COSTS (Details) - USD ($) $ in Thousands | 3 Months Ended | 39 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Mar. 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | |||
Restructuring expense | $ 1,038 | $ 656 | $ 23,481 |
Severance and related charges | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring expense | 404 | 152 | 17,317 |
Facility relocation and closure charges | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring expense | $ 634 | $ 504 | $ 6,164 |
RESTRUCTURING COSTS - Schedule
RESTRUCTURING COSTS - Schedule of Restructuring liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | 39 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Mar. 31, 2021 | |
Restructuring Reserve [Roll Forward] | |||
Beginning balance | $ 10,641 | ||
Cost incurred and charged to expense | 1,038 | $ 656 | $ 23,481 |
Cost paid or otherwise settled | (512) | ||
Ending balance | $ 11,167 | $ 11,167 |
WARRANTIES - Narrative (Details
WARRANTIES - Narrative (Details) | 3 Months Ended |
Mar. 31, 2021 | |
Minimum [Member] | |
Product Liability Contingency [Line Items] | |
Standard Product Warranty Term | 12 months |
Maximum [Member] | |
Product Liability Contingency [Line Items] | |
Standard Product Warranty Term | 24 months |
WARRANTIES - Changes in Product
WARRANTIES - Changes in Product Warranty Obligation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Balances at beginning of period | $ 4,780 | $ 6,413 |
Increases to accruals | 780 | 758 |
Warranty expenditures | (1,051) | (856) |
Effect of changes in exchange rates | (5) | |
Balances at end of period | $ 4,504 | $ 6,315 |
LEASES - Components of operatin
LEASES - Components of operating lease cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
LEASES | ||
Operating lease cost | $ 5,921 | $ 4,834 |
Short-term and variable lease cost | 842 | 1,308 |
Total operating lease cost | $ 6,763 | $ 6,142 |
LEASES - Operating lease maturi
LEASES - Operating lease maturity schedule (Details) $ in Thousands | Mar. 31, 2021USD ($) |
LEASES | |
2021 (remaining) | $ 15,482 |
2022 | 16,723 |
2023 | 13,503 |
2024 | 12,120 |
2025 | 10,664 |
Thereafter | 74,413 |
Total lease payments | 142,905 |
Less: Interest | (33,375) |
Present value of lease liabilities | $ 109,530 |
LEASES - Other lease cost infor
LEASES - Other lease cost information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Lessee, Lease, Description [Line Items] | ||
Weighted average remaining lease term (in years) | 10 years 7 months 6 days | 9 years 8 months 12 days |
Weighted average discount rate | 4.60% | 4.30% |
Cash paid for operating leases | $ 5,958 | $ 5,574 |
Right-of-use assets obtained in exchange for operating lease liabilities | $ 2,192 | $ 22,208 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) shares in Millions | 3 Months Ended |
Mar. 31, 2021shares | |
2017 OMNIBUS Incentive Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 2 |
Restricted Stock Units (RSUs) [Member] | Minimum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years |
Restricted Stock Units (RSUs) [Member] | Maximum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years |
Stock Option Awards [Member] | |
Awards term | 10 years |
Stock Option Awards [Member] | Minimum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years |
Stock Option Awards [Member] | Maximum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years |
STOCK-BASED COMPENSATION - Sche
STOCK-BASED COMPENSATION - Schedule of stock-based compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
STOCK-BASED COMPENSATION | ||
Stock-based compensation expense | $ 5,701 | $ 3,048 |
STOCK-BASED COMPENSATION - Summ
STOCK-BASED COMPENSATION - Summary of Restricted Stock Units activity (Details) - Restricted Stock Units (RSUs) [Member] shares in Thousands | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding at the beginning of period | shares | 608 |
Granted | shares | 227 |
Vested | shares | (125) |
Forfeited | shares | (110) |
Outstanding at the end of period | shares | 600 |
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares | $ 58.15 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | 93.93 |
Weighted Average Grant Date Fair Value, Vested | $ / shares | 58.18 |
Weighted Average Grant Date Fair Value, Forfeited | $ / shares | 65.70 |
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares | $ 70.37 |
STOCK-BASED COMPENSATION - Su_2
STOCK-BASED COMPENSATION - Summary of stock option activity (Details) - Time Based [Member] shares in Thousands | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding at beginning of period | shares | 147 |
Exercised | shares | (13) |
Outstanding at ending of period | shares | 134 |
Weighted-Average Exercise Price Per Share, Beginning Balance | $ / shares | $ 23.63 |
Weighted-Average Exercise Price Per Share, Exercised | $ / shares | 20.52 |
Weighted-Average Exercise Price Per Share, End Balance | $ / shares | $ 23.92 |
SIGNIFICANT CUSTOMER INFORMAT_3
SIGNIFICANT CUSTOMER INFORMATION (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Revenue, Major Customer [Line Items] | |||
Sales, net | $ 351,620 | $ 315,456 | |
Product [Member] | |||
Revenue, Major Customer [Line Items] | |||
Sales, net | 318,879 | 289,361 | |
Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | Applied Materials, Inc. [Member] | |||
Revenue, Major Customer [Line Items] | |||
Sales, net | $ 67,788 | $ 50,981 | |
Significant concentration risk, 10% or more of total balance | 19.30% | 16.20% | |
Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | Lam Research [Member] | |||
Revenue, Major Customer [Line Items] | |||
Sales, net | $ 32,996 | ||
Significant concentration risk, 10% or more of total balance | 10.50% | ||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Applied Materials, Inc. [Member] | |||
Revenue, Major Customer [Line Items] | |||
Significant concentration risk, 10% or more of total balance | 17.00% | 14.20% | |
Accounts receivable | $ 40,357 | $ 33,402 | |
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Nidec Motor Corporation [Member] | |||
Revenue, Major Customer [Line Items] | |||
Significant concentration risk, 10% or more of total balance | 10.40% | ||
Accounts receivable | $ 24,344 |
CREDIT FACILITY (Details)
CREDIT FACILITY (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2019 | |
Line of Credit Facility [Line Items] | |||
Fair value of long-term debt | $ 317,800 | ||
Long-term debt | $ 317,797 | $ 322,046 | |
Loan value, percentage | 85.00% | ||
Average fixed rate | 0.521% | ||
Revolving Credit Facility [Member] | |||
Line of Credit Facility [Line Items] | |||
Line of credit facility, borrowing capacity | $ 500,000 | ||
Credit availability under the Loan Agreement | $ 150,000 | ||
Term Loan Facility [Member] | |||
Line of Credit Facility [Line Items] | |||
Line of credit facility, borrowing capacity | 350,000 | ||
Unsecured Revolving Facility [Member] | |||
Line of Credit Facility [Line Items] | |||
Line of credit facility, borrowing capacity | $ 150,000 | ||
Revolving Credit Facility and Term Loan Facility | |||
Line of Credit Facility [Line Items] | |||
Balance | 319,375 | ||
Term Loan, Fixed Interest Rate [Member] | |||
Line of Credit Facility [Line Items] | |||
Balance | $ 268,844 | ||
Interest Rate | 1.271% | ||
Term Loan, Variable Interest Rate [Member] | |||
Line of Credit Facility [Line Items] | |||
Balance | $ 50,531 | ||
Interest Rate | 0.91% | ||
Revolving Facility, Variable Interest Rate [Member] | |||
Line of Credit Facility [Line Items] | |||
Interest Rate | 0.91% | ||
Unused Line Fee | 0.10% | ||
Foreign Exchange Forward [Member] | |||
Line of Credit Facility [Line Items] | |||
Derivative, notional amount | $ 35,280 | ||
Interest Rate Swap [Member] | |||
Line of Credit Facility [Line Items] | |||
Derivative, notional amount | $ 268,844 | $ 273,219 |
CREDIT FACILITY - Debt obligati
CREDIT FACILITY - Debt obligation (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt: | ||
Term Loan Facility | $ 319,375 | $ 323,750 |
Less: debt issuance costs | (1,578) | (1,704) |
Total debt | 317,797 | 322,046 |
Less current portion of long-term debt | (17,500) | (17,500) |
Total long-term debt | $ 300,297 | $ 304,546 |
CREDIT FACILITY - Contractual m
CREDIT FACILITY - Contractual maturities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
CREDIT FACILITY | ||
2021 (remaining) | $ 13,125 | |
2022 | 17,500 | |
2023 | 17,500 | |
2024 | 271,250 | |
Total | $ 319,375 | $ 323,750 |
CREDIT FACILITY - Interest expe
CREDIT FACILITY - Interest expense and unused line of credit fees (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CREDIT FACILITY | ||
Interest expense | $ 985 | $ 2,099 |
Amortization of debt issuance costs | 126 | 133 |
Unused line of credit fees and other | 37 | 38 |
Total interest expense | $ 1,148 | $ 2,270 |