Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Feb. 02, 2024 | Jun. 30, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 1-13648 | ||
Entity Registrant Name | Balchem Corp | ||
Entity Incorporation, State or Country Code | MD | ||
Entity Tax Identification Number | 13-2578432 | ||
Entity Address, Address Line One | 5 Paragon Drive | ||
Entity Address, City or Town | Montvale | ||
Entity Address, State or Province | NJ | ||
Entity Address, Postal Zip Code | 07645 | ||
City Area Code | 845 | ||
Local Phone Number | 326-5600 | ||
Title of 12(b) Security | Common Stock, par value $.06-2/3 per share | ||
Trading Symbol | BCPC | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Small Reporting Company | false | ||
Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 4,321 | ||
Entity Common Stock, Shares Outstanding | 32,266,941 | ||
Documents Incorporated by Reference | Selected portions of the Registrant’s proxy statement for its 2024 Annual Meeting of Shareholders (the “2024 Proxy Statement”) to be filed with the Securities and Exchange Commission pursuant to Regulation 14A within 120 days after Registrant’s fiscal year-end of December 31, 2023 are incorporated by reference in Part III of this Annual Report on Form 10-K to the extent stated therein. | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Central Index Key | 0000009326 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Auditor Information [Abstract] | |
Auditor Name | RSM US LLP |
Auditor Firm ID | 49 |
Auditor Location | New York, New York |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 64,447 | $ 66,560 |
Accounts receivable, net of allowance for doubtful accounts of $908 and $1,226 at December 31, 2023 and 2022, respectively | 125,284 | 131,578 |
Inventories, net | 109,521 | 119,668 |
Prepaid expenses | 7,798 | 4,903 |
Derivative assets | 0 | 5,993 |
Other current assets | 7,192 | 7,101 |
Total current assets | 314,242 | 335,803 |
Property, plant and equipment, net | 276,039 | 271,355 |
Goodwill | 778,907 | 769,509 |
Intangible assets with finite lives, net | 191,212 | 213,295 |
Right of use assets - operating leases | 17,763 | 17,094 |
Right of use assets - finance lease | 2,101 | 2,338 |
Other non-current assets | 16,947 | 15,118 |
Total assets | 1,597,211 | 1,624,512 |
Current liabilities: | ||
Trade accounts payable | 55,503 | 57,322 |
Accrued expenses | 40,855 | 36,745 |
Accrued compensation and other benefits | 17,228 | 16,544 |
Dividends payable | 25,717 | 23,129 |
Income tax payable | 4,967 | 2,280 |
Operating lease liabilities - current | 3,949 | 3,796 |
Finance lease liabilities - current | 272 | 226 |
Total current liabilities | 148,491 | 140,042 |
Revolving loan | 309,569 | 440,569 |
Deferred income taxes | 52,046 | 62,784 |
Operating lease liabilities - non-current | 14,601 | 13,806 |
Finance lease liabilities - non-current | 1,943 | 2,213 |
Other long-term obligations | 16,577 | 26,814 |
Total liabilities | 543,227 | 686,228 |
Commitments and contingencies (Note 16) | ||
Stockholders’ equity: | ||
Preferred stock, $25 par value. Authorized 2,000,000 shares; none issued and outstanding | 0 | 0 |
Common stock, $.0667 par value. Authorized 120,000,000 shares; 32,254,728 shares issued and outstanding at December 31, 2023 and 32,152,787 shares issued and outstanding at December 31, 2022, respectively | 2,152 | 2,145 |
Additional paid-in capital | 145,653 | 128,806 |
Retained earnings | 897,488 | 814,487 |
Accumulated other comprehensive income (loss) | 8,691 | (7,154) |
Total stockholders’ equity | 1,053,984 | 938,284 |
Total liabilities and stockholders’ equity | $ 1,597,211 | $ 1,624,512 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Accounts receivable, allowance for doubtful accounts | $ 908 | $ 1,226 |
Stockholders’ equity: | ||
Preferred stock, par value (in dollars per share) | $ 25 | $ 25 |
Preferred stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0667 | $ 0.0667 |
Common stock, shares authorized (in shares) | 120,000,000 | 120,000,000 |
Common stock, shares issued (in shares) | 32,254,728 | 32,152,787 |
Common stock, shares outstanding (in shares) | 32,254,728 | 32,152,787 |
Consolidated Statements of Earn
Consolidated Statements of Earnings - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | |||
Net sales | $ 922,439 | $ 942,358 | $ 799,023 |
Cost of sales | 620,383 | 661,907 | 555,849 |
Gross margin | 302,056 | 280,451 | 243,174 |
Operating expenses: | |||
Selling expenses | 74,397 | 67,409 | 60,413 |
Research and development expenses | 15,049 | 12,191 | 13,524 |
General and administrative expenses | 53,417 | 55,665 | 41,735 |
Total operating expenses | 142,863 | 135,265 | 115,672 |
Earnings from operations | 159,193 | 145,186 | 127,502 |
Other expenses: | |||
Interest expense, net | 22,613 | 10,268 | 2,456 |
Other (income) expense, net | (681) | 1,169 | (187) |
Total other expenses | 21,932 | 11,437 | 2,269 |
Earnings before income tax expense | 137,261 | 133,749 | 125,233 |
Income tax expense | 28,718 | 28,382 | 29,129 |
Net earnings | $ 108,543 | $ 105,367 | $ 96,104 |
Basic net earnings per common share (in dollars per share) | $ 3.38 | $ 3.29 | $ 2.98 |
Diluted net earnings per common share (in dollars per share) | $ 3.35 | $ 3.25 | $ 2.94 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | |||
Net earnings | $ 108,543 | $ 105,367 | $ 96,104 |
Other comprehensive income (loss), net of tax: | |||
Net foreign currency translation adjustment | 16,809 | (4,799) | (11,255) |
Unrealized (loss) gain on cash flow hedge, net of taxes of $341, $868, and $654 at December 31, 2023, 2022, and 2021, respectively | (1,065) | 2,696 | 2,053 |
Net change in postretirement benefit plan, net of taxes of $39, $24, and $13 at December 31, 2023, 2022 and 2021, respectively | 101 | (58) | 36 |
Other comprehensive income (loss), net of tax | 15,845 | (2,161) | (9,166) |
Comprehensive income | $ 124,388 | $ 103,206 | $ 86,938 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Other comprehensive income (loss), net of tax: | |||
Unrealized gain/(loss) on cash flow hedge taxes | $ (341) | $ 868 | $ 654 |
Net change in postretirement benefit plan taxes | $ 39 | $ 24 | $ 13 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Common Stock | Additional Paid-in Capital | |
Beginning balance at Dec. 31, 2020 | $ 828,233 | $ 656,740 | $ 4,173 | $ 2,160 | $ 165,160 | |
Beginning balance (in shares) at Dec. 31, 2020 | 32,372,621 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net earnings | 96,104 | 96,104 | ||||
Other comprehensive (loss) income | (9,166) | (9,166) | ||||
Dividends | (20,706) | (20,706) | ||||
Repurchases of common stock | (35,239) | $ (17) | (35,222) | |||
Repurchases of common stock (in shares) | (249,848) | |||||
Shares and options issued under stock plans | 17,789 | $ 11 | 17,778 | |||
Shares and options issued under stock plans (in shares) | 164,377 | |||||
Ending balance at Dec. 31, 2021 | 877,015 | 732,138 | (4,993) | $ 2,154 | 147,716 | |
Ending balance (in shares) at Dec. 31, 2021 | 32,287,150 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net earnings | 105,367 | 105,367 | ||||
Other comprehensive (loss) income | (2,161) | (2,161) | ||||
Dividends | (23,018) | (23,018) | ||||
Repurchases of common stock | (35,423) | $ (16) | (35,407) | |||
Repurchases of common stock (in shares) | (252,304) | |||||
Shares and options issued under stock plans | 16,504 | $ 7 | 16,497 | |||
Shares and options issued under stock plans (in shares) | 117,941 | |||||
Ending balance at Dec. 31, 2022 | $ 938,284 | 814,487 | (7,154) | $ 2,145 | 128,806 | |
Ending balance (in shares) at Dec. 31, 2022 | 32,152,787 | 32,152,787 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net earnings | $ 108,543 | 108,543 | ||||
Other comprehensive (loss) income | 15,845 | 15,845 | ||||
Dividends | (25,542) | (25,542) | ||||
Repurchases of common stock | [1] | (4,514) | $ (2) | (4,512) | ||
Repurchases of common stock (in shares) | [1] | (32,558) | ||||
Shares and options issued under stock plans | 21,368 | $ 9 | 21,359 | |||
Shares and options issued under stock plans (in shares) | 134,499 | |||||
Ending balance at Dec. 31, 2023 | $ 1,053,984 | $ 897,488 | $ 8,691 | $ 2,152 | $ 145,653 | |
Ending balance (in shares) at Dec. 31, 2023 | 32,254,728 | 32,254,728 | ||||
[1] * On August 16, 2022, the U.S. government enacted the Inflation Reduction Act (the "IRA") into law. The IRA imposes a 1% excise tax on share repurchases, which is effective for repurchases completed after December 31, 2022. The excise tax is recorded within equity as part of the repurchase of the common stock. |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Stockholders' Equity [Abstract] | |||
Dividends (in dollars per share) | $ 0.79 | $ 0.71 | $ 0.64 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities: | |||
Net earnings | $ 108,543 | $ 105,367 | $ 96,104 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | |||
Depreciation and amortization | 54,935 | 51,848 | 48,879 |
Stock compensation expense | 16,052 | 13,224 | 10,802 |
Deferred income taxes | (10,814) | (8,362) | (5,944) |
Provision for doubtful accounts | 37 | 401 | 180 |
Unrealized (gain) loss on foreign currency transactions and deferred compensation | (733) | 914 | (384) |
Asset impairment charge and (gain) loss on disposal of assets | 7,031 | 366 | (53) |
Change in fair value of contingent consideration liability | (11,300) | 0 | 0 |
Changes in assets and liabilities, net of acquired balances | |||
Accounts receivable | 6,969 | (3,618) | (20,700) |
Inventories | 10,530 | (7,804) | (21,023) |
Prepaid expenses and other current assets | (3,540) | 1,870 | (881) |
Accounts payable and accrued expenses | 3,552 | (15,543) | 47,067 |
Income taxes | 2,194 | 296 | 4,787 |
Other | 305 | (423) | 1,680 |
Net cash provided by operating activities | 183,761 | 138,536 | 160,514 |
Cash flows from investing activities: | |||
Cash paid for acquisitions, net of cash acquired | (1,252) | (365,780) | 0 |
Capital expenditures and intangible assets acquired | (37,892) | (49,945) | (37,363) |
Proceeds from sale of assets | 1,881 | 206 | 318 |
Proceeds from settlement of net investment hedge | 2,740 | 0 | 0 |
Proceeds from insurance | 0 | 0 | 1,831 |
Investment in affiliates | (290) | (495) | (86) |
Net cash used in investing activities | (34,813) | (416,014) | (35,300) |
Cash flows from financing activities: | |||
Proceeds from revolving loan | 18,000 | 435,000 | 5,000 |
Principal payments on revolving debt | (149,000) | (103,000) | (60,000) |
Principal payment on acquired debt | 0 | (30,988) | 0 |
Cash paid for financing costs | 0 | (1,232) | 0 |
Principal payments on finance lease | (222) | (177) | (159) |
Proceeds from stock options exercised | 5,242 | 3,212 | 6,943 |
Dividends paid | (22,872) | (20,713) | (18,723) |
Repurchases of common stock | (4,469) | (35,423) | (35,239) |
Net cash (used in) provided by financing activities | (153,321) | 246,679 | (102,178) |
Effect of exchange rate changes on cash | 2,260 | (5,880) | (4,368) |
(Decrease) increase in cash and cash equivalents | (2,113) | (36,679) | 18,668 |
Cash and cash equivalents beginning of period | 66,560 | 103,239 | 84,571 |
Cash and cash equivalents end of period | $ 64,447 | $ 66,560 | $ 103,239 |
BUSINESS DESCRIPTION AND SUMMAR
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business Description Balchem Corporation (“Balchem” or the “Company”), including, unless the context otherwise requires, its wholly-owned subsidiaries, incorporated in the State of Maryland in 1967, is engaged in the development, manufacture and marketing of specialty performance ingredients and products for the food, nutritional, feed, pharmaceutical, agricultural, and medical sterilization industries. Principles of Consolidation The consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications have been made to prior period amounts to conform with the current period's presentation. Revenue Recognition Revenue for each of the Company’s business segments is recognized when control of the promised goods is transferred to our customers, in an amount that reflects the consideration we expect to realize in exchange for those goods. The Company reports amounts billed to customers related to shipping and handling as revenue and includes costs incurred for shipping and handling in cost of sales. Amounts received for unshipped merchandise are not recognized as revenue but rather they are recorded as customer deposits and are included in current liabilities. In instances of shipments made on consignment, revenue is recognized when control is transferred to the customer. In accordance with Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers , revenue-generating contracts are assessed to identify distinct performance obligations, allocating transaction prices to those performance obligations, and criteria for satisfaction of a performance obligation. The standard allows for recognition of revenue only when we have satisfied a performance obligation through transferring control of the promised good or service to a customer. Control, in this instance, may mean the ability to prevent other entities from directing the use of, and receiving benefit from, a good or service. The standard indicates that an entity must determine at contract inception whether it will transfer control of a promised good or service over time or satisfy the performance obligation at a point in time through analysis of the following criteria: (i) the entity has a present right to payment, (ii) the customer has legal title, (iii) the customer has physical possession, (iv) the customer has the significant risks and rewards of ownership and (v) the customer has accepted the asset. The Company assesses collectability based primarily on the customer’s payment history and on the creditworthiness of the customer. Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity of three months or less to be cash equivalents. The Company has funds in its cash accounts that are with third party financial institutions, primarily in certificates of deposit and money market funds. The Company's balances of cash and cash equivalents in the U.S. and other countries exceed the insurance limits of the Federal Deposit Insurance Corporation (“FDIC”) and other relevant insurance limits in other countries. Accounts Receivable Credit terms are granted in the normal course of business to the Company’s customers and on-going credit evaluations are performed on the Company’s customers. In June 2016, the FASB issued Accounting Standards Update ("ASU") No. 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments", which requires that credit losses be reported based on expected losses instead of the incurred loss model. Based on this ASU, customers' credit limits are adjusted based upon their reasonably expected credit worthiness which is determined through review of their payment history, their current credit information, and any foreseeable future events. Collections and payments from customers are continuously monitored and allowances for doubtful accounts for estimated losses resulting from the inability of the Company’s customers to make required payments are maintained. Estimated losses are based on historical experience, any specific customer collection issues identified, and any reasonably expected future adverse events. If the financial condition of our customers were to deteriorate resulting in an impairment of their ability to make payments, additional allowances and related bad debt expense may be required. Inventories Inventories are valued at the lower of cost (first in, first out) or net realizable value and have been reduced by an allowance for excess or obsolete inventories. Cost elements include material, labor and manufacturing overhead. Property, Plant and Equipment and Depreciation Property, plant and equipment are stated at cost. Depreciation of plant and equipment is calculated using the straight-line method over the estimated useful lives of the assets as follows: Buildings 15-25 years Equipment 2-28 years Expenditures for repairs and maintenance are charged to expense. Alterations and major overhauls that extend the lives or increase the capacity of plant assets are capitalized. When assets are retired or otherwise disposed of, the cost of the assets and the related accumulated depreciation are removed from the accounts and any resultant gain or loss is included in earnings from operations. Business Concentrations Financial instruments that subject the Company to credit risk consist primarily of accounts receivable and money market investments. Investments are managed within established guidelines to mitigate risks. Accounts receivable subject the Company to credit risk partially due to the concentration of amounts due from customers. The Company extends credit to its customers based upon an evaluation of the customers’ financial condition and credit histories. In 2023, 2022 and 2021, no customer accounted for more than 10% of total net sales or accounts receivable. Post-employment Benefits We provide life insurance, health care benefits, and defined benefit pension plan payments for certain eligible retirees and health care benefits for certain retirees’ eligible survivors. The costs and obligations related to these benefits reflect our assumptions as to health care cost trends and key economic conditions including discount rates, expected rate of return on plan assets, and expected salary increases. The cost of providing plan benefits also depends on demographic assumptions including retirements, mortality, turnover, and plan participation. If actual experience differs from these assumptions, the cost of providing these benefits could increase or decrease. In accordance with ASC 715, “Compensation-Retirement Benefits,” we are required to recognize the overfunded or underfunded status of a defined benefit post retirement plan (other than a multiemployer plan) as an asset or liability in our statement of financial position, and to recognize changes in that funded status in the year in which the changes occur through comprehensive income. Goodwill and Acquired Intangible Assets Goodwill represents the excess of purchase price over the fair value of net assets acquired in accordance with ASC 805, "Business Combinations". Goodwill and intangible assets acquired in a business combination that have indefinite useful lives are not amortized but are instead assessed for impairment annually and more frequently if events and circumstances indicate that the assets might be impaired, in accordance with the provisions of ASC 350, "Intangibles-Goodwill and Other". The Company performed its annual test as of October 1. ASC 350 also requires that intangible assets with estimable useful lives be amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment if events and circumstances indicate that the assets might be impaired. In January 2017, the FASB issued ASU No. 2017-04, “Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”), which addresses changes to the testing for goodwill impairment by eliminating Step 2 of the process. In accordance with this update, a goodwill impairment test will be performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value. As of October 1, 2023 and 2022, the Company opted to bypass the qualitative assessment and proceeded directly to performing the quantitative goodwill impairment test. The Company assessed the fair values of its reporting units by utilizing the income approach, based on a discounted cash flow valuation model as the basis for its conclusions. The Company's estimates of future cash flows included significant management assumptions such as revenue growth rates, operating margins, discount rates, estimated terminal values and future economic and market conditions. The Company's assessment concluded that the fair values of the reporting units exceeded their carrying amounts, including goodwill. Accordingly, the goodwill of the reporting units was not considered impaired as of October 1, 2023 and 2022. The Company may resume performing the qualitative assessment in subsequent periods. The Company had goodwill in the amount of $778,907 and $769,509 as of December 31, 2023 and 2022, respectively, subject to the provisions of ASC 350, “Intangibles-Goodwill and Other.” Goodwill at December 31, 2021 $ 523,949 Goodwill as a result of the Kappa acquisition 216,295 Goodwill as a result of the Bergstrom acquisition 31,209 Impact due to change in foreign exchange rates (1,944) Goodwill at December 31, 2022 769,509 Goodwill as a result of the Bergstrom acquisition 341 Impact due to change in foreign exchange rates 9,057 Goodwill at December 31, 2023 $ 778,907 December 31, 2023 December 31, 2022 HNH $ 673,207 $ 665,804 ANH 24,469 24,218 Specialty Products 81,175 79,429 Other and Unallocated 56 58 Total $ 778,907 $ 769,509 The following intangible assets with finite lives are stated at cost and are amortized either on an accelerated basis or on a straight-line basis over the following estimated useful lives: Amortization Period Customer relationships and lists 10 - 20 Trademarks and trade names 2 - 17 Developed technology 5 - 12 Regulatory registration costs 5 - 10 Patents and trade secrets 15 - 17 Other 2 - 18 Intangible assets with finite lives are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset, which is generally based on discounted cash flows. The useful life of an intangible asset is based on our assumptions regarding expected use of the asset; the relationship of the intangible asset to another asset or group of assets; any legal, regulatory or contractual provisions that may limit the useful life of the asset or that enable renewal or extension of the asset’s legal or contractual life without substantial cost; the effects of obsolescence, demand, competition and other economic factors; and the level of maintenance expenditures required to obtain the expected future cash flows from the asset and their related impact on the asset’s useful life. If events or circumstances indicate that the life of an intangible asset has changed, it could result in higher future amortization charges or recognition of an impairment loss. For the year ended December 31, 2023, there were no triggering events which required intangible asset impairment reviews. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the fiscal year in which those temporary differences are expected to be recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. In evaluating our ability to recover our deferred tax assets, in full or in part, we consider all available positive and negative evidence, including our past operating results, our forecast of future market growth, forecasted earnings, future taxable income, and prudent and feasible tax planning strategies. The assumptions utilized in determining future taxable income require judgment and are consistent with the plans and estimates we are using to manage the underlying businesses. We recognize uncertain income tax positions taken on income tax returns at the largest amount that is more likely than not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a fifty percent likelihood of being sustained. Our policy for recording interest and penalties associated with uncertain tax positions is to record such items as a component of our income tax provision. Use of Estimates Management is required to make certain estimates and assumptions during the preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America. These estimates and assumptions impact the reported amount of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and revenues and expenses during the reporting period. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Actual results could differ from those estimates. Fair Value of Financial Instruments The Company has a number of financial instruments, none of which are held for trading purposes. The estimated fair value amounts have been determined by the Company using available market information and appropriate valuation methodologies. Considerable judgment is required in interpreting market data to develop the estimates of fair value, and, accordingly, the estimates are not necessarily indicative of the amounts that the Company could realize in a current market exchange. The carrying value of debt approximates fair value as the interest rate is based on market and the Company’s consolidated leverage ratio. The Company’s financial instruments also include cash equivalents, accounts receivable, accounts payable and accrued liabilities, and are carried at cost which approximates fair value due to the short-term maturity of these instruments. In addition, non-current assets includes rabbi trust funds related to the Company's deferred compensation plan. The money market and rabbi trust funds are valued using level one inputs, as defined by ASC 820, "Fair Value Measurement." The Company also had derivative financial instruments, consisting of a cross-currency swap and an interest rate swap, which were included in derivative assets and derivative liabilities, in the consolidated balance sheets (see Note 20, Derivative Instruments and Hedging Activities ). The fair values of these derivative instruments were determined based on Level 2 inputs, using significant inputs that were observable either directly or indirectly, including interest rate curves and implied volatilities. These derivatives were settled on their maturity date on June 27, 2023 and there were no other derivatives outstanding as of December 31, 2023. Cost of Sales Cost of sales are primarily comprised of raw materials and supplies consumed in the manufacture of product, as well as manufacturing labor, maintenance labor, depreciation expense, and direct overhead expense necessary to convert purchased materials and supplies into finished product. Cost of sales also includes inbound freight costs, outbound freight costs for shipping products to customers, warehousing costs, quality control and obsolescence expense. Selling, General and Administrative Expenses Selling expenses consist primarily of compensation and benefit costs, amortization of customer relationships and lists, trade promotions, advertising, commissions and other marketing costs. General and administrative expenses consist primarily of payroll and benefit costs, occupancy and operating costs of corporate offices, depreciation and amortization expense on non-manufacturing assets, information systems costs and other miscellaneous administrative costs. Research and Development Research and development costs are associated directly with the Company's efforts to develop, design, and enhance its products, services, technologies, or processes. Such costs are expensed as incurred. Net Earnings Per Common Share Basic net earnings per common share is calculated by dividing net earnings by the weighted average number of common shares outstanding during the period. Diluted net earnings per common share is calculated in a manner consistent with basic net earnings per common share except that the weighted average number of common shares outstanding also includes the dilutive effect of stock options outstanding, unvested restricted stock, and unvested performance shares (using the treasury stock method). Stock-based Compensation The Company has stock-based employee compensation plans, which are described more fully in Note 3, Stockholders' Equity . The Company accounts for stock-based compensation in accordance with ASC 718, “Compensation-Stock Compensation,” which requires all share-based payments, including grants of stock options, to be recognized in the statement of earnings as an operating expense, based on their fair values. The Company estimates the fair value of each option award on the date of grant using either the Black-Scholes model or the Binomial model, whichever is deemed to be most appropriate. Estimates of and assumptions about forfeiture rates, terms, volatility, interest rates and dividend yields are used to calculate stock-based compensation. A significant change to these estimates could materially affect the Company’s operating results. Impairment of Long-lived Assets Long-lived assets, such as property, plant, and equipment, and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset group to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset, which is generally based on discounted cash flows. Derivative Instruments and Hedging Activities The Company is exposed to market fluctuations in interest rates as well as variability in foreign exchange rates. In May 2019, the Company entered into an interest rate swap with JP Morgan Chase, N.A. (the "Swap Counterparty") and a cross-currency swap with JP Morgan Chase, N.A. (the "Bank Counterparty"). The Company's primary objective for holding derivative financial instruments was to manage interest rate risk and foreign currency risk. The Company does not enter into derivative financial instruments for trading or speculative purposes. The derivative instruments were with the above single counterparty and were subject to a contractual agreement that provided for the net settlement of all contracts through a single payment in a single currency in the event of default on or termination of any one contract. As such, the derivative instruments were categorized as a master netting arrangement and presented as a net derivative asset or derivative liability on the consolidated balance sheet as of December 31, 2022. The Company settled its derivative instruments on their maturity date of June 27, 2023 and had no other derivatives outstanding as of December 31, 2023. On a quarterly basis through their maturity, we assessed the effectiveness of the hedging relationships for the interest rate swap and cross-currency swap by reviewing the critical terms indicated in the applicable agreement. The hedging relationships were determined to be highly effective. As such, the net change in fair values of the interest rate swap, that qualified as a cash flow hedge, was recorded in accumulated other comprehensive income/(loss) and subsequently reclassified into interest expense as interest payments were made on our debt. For the cross-currency swap, the amounts that have not yet been recognized in earnings remain in the cumulative translation adjustment section of accumulated other comprehensive income until the hedged net investment is sold or liquidated in accordance with paragraphs 815-35-35-5A, "Derivatives and Hedging - Net Investment Hedges", and 830-30-40-1 through 40-1A, "Foreign Currency Matters - Derecognition". Refer to Note 20, Derivative Instruments and Hedging Activities , for detailed information about our derivative financial instruments. Recently Issued Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740) - Improvements to Income Tax Disclosures." The new guidance is intended to enhance the transparency and decision usefulness of income tax disclosures by requiring disaggregated information about a reporting entity's effective tax rate reconciliation and information on income taxes paid. The amendment is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendment in this Update should be applied on a prospective basis, with retrospective application permitted. The Company is in the process of evaluating the impact that the adoption of ASU 2023-09 will have to the financial statements and related disclosures. In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures." The ASU expands reportable segment disclosure requirements by requiring disclosures of significant reportable segment expenses that are regularly provided to the Chief Operating Decision Maker (“CODM”) and included within each reported measure of a segment's profit or loss. The ASU also requires disclosure of the title and position of the individual identified as the CODM and an explanation of how the CODM uses the reported measures of a segment's profit or loss in assessing segment performance and deciding how to allocate resources. Additionally, ASU 2023-07 requires all segment profit or loss and assets disclosures to be provided on an annual and interim basis. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning December 15, 2024. Early adoption is permitted and the amendments must be applied retrospectively to all prior periods presented. The adoption of this guidance will not affect the Company's consolidated results of operations, financial position or cash flows. The Company is currently evaluating the effect the guidance will have on its disclosures. In August 2023, the FASB issued ASU 2023-05, "Business Combinations - Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement." The new guidance applies to the formation of a joint venture and requires a joint venture to initially measure all contributions received upon its formation at fair value. The guidance is intended to reduce diversity in practice and is applicable to joint venture entities with a formation date on or after January 1, 2025 on a prospective basis. While ASU 2023-05 is not currently applicable to Balchem, the Company will apply this guidance in future reporting periods after the guidance is effective to any future arrangements meeting the definition of a joint venture. 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", and in December 2022 subsequently issued ASU 2022-06, “Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848.” These ASU’s provide temporary optional guidance to ease the potential burden in accounting for reference rate reform. The Standards Updates provide optional expedients and exceptions for applying accounting principles generally accepted in the United States to contract modifications and hedging relationships that reference LIBOR or another reference rate that are expected to be discontinued. The Standards Updates were effective upon issuance and can generally be applied through December 31, 2024. Due to the discontinuation of LIBOR and under the relief provided by Topic 848, during the third quarter of 2022, the Company modified its interest rate swap and replaced LIBOR with 1-month CME Term SOFR. The modification of the agreement did not have a significant impact on the Company's consolidated financial statements and disclosures. The interest rate swap matured on June 27, 2023. |
SIGNIFICANT ACQUISITIONS
SIGNIFICANT ACQUISITIONS | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
SIGNIFICANT ACQUISITIONS | SIGNIFICANT ACQUISITIONS Cardinal Associates Inc. ("Bergstrom") On August 30, 2022, the Company's wholly-owned subsidiary Albion Laboratories, Inc. ("Albion") entered into a Stock Purchase Agreement, and closed on such transaction with Cardinal Associates Inc. ("Cardinal"), a corporation organized under the laws of the State of Washington, pursuant to which Albion acquired Cardinal and its Bergstrom Nutrition business (collectively, "Bergstrom"). Bergstrom Nutrition is a leading science-based manufacturer of MSM, based in Vancouver, Washington. MSM is a widely used nutritional ingredient with strong scientific evidence supporting its benefits for joint health, sports nutrition, skin and beauty, healthy aging, and pet health. The addition of OptiMSM ® , Bergstrom Nutrition's MSM brand, to the Company's portfolio within the Human Nutrition and Health and Animal Nutrition and Health segments provides a synergistic scientific advantage in Balchem's key strategic therapeutic focus areas such as longevity and performance and is a strong fit with Balchem's specialty, science-backed mineral products. The Company made payments of $72,143 for the acquisition, amounting to $71,937 to the former shareholders or on behalf of the former shareholders and $206 to pay off Bergstrom's bank debt. Net of cash acquired of $773, total payments made to the former shareholders or on behalf of the former shareholders of Bergstrom were $71,164. The acquisition was primarily financed through the 2022 Credit Agreement (see Note 8, Revolving Loan ). In connection with this transaction, the former shareholders of Bergstrom had an opportunity to receive an additional payment in 2024 if certain financial performance targets and other metrics were met. As of December 31, 2023, the earn-out periods concluded and the Company recorded a contingent consideration liability of $100 which was included in "Accrued expenses" on the consolidated balance sheets. The Company also made an additional post-closing payment of $910 in the third quarter of 2023 that was negotiated as a deduction of the cash consideration at closing. As a result, total payments related to the transaction are expected to be $72,243, comprised of the upfront cash consideration of $70,892, a working capital adjustment of $341, an additional post-closing payment of $910, and the fair value of the earn-out payment of $100. The goodwill of $31,550 that arose on the acquisition date consists largely of expected synergies, including the combined entities' experience and technical problem-solving capabilities, and acquired workforce. 80% of the goodwill is assigned to the Human Nutrition and Health business segment and 20% of the goodwill is assigned to the Animal Nutrition and Health business segment. For tax purposes, a joint election under 338(h)(10) was made to treat the stock acquisition as a deemed asset acquisition, therefore generating tax amortizable goodwill. The following table summarizes the fair values of the assets acquired and liabilities assumed: Cash and cash equivalents $ 773 Accounts receivable 4,699 Inventories 3,972 Property, plant and equipment 2,243 Right of use assets 866 Customer relationships 29,900 Developed technology 4,600 Trademarks 2,300 Other assets 197 Accounts payable (699) Bank debt (206) Lease liabilities (871) Other liabilities (462) Goodwill 31,550 Total consideration on acquisition date and working capital adjustment 78,862 Net decrease to contingent consideration liability and other post-closing payments (6,825) Total expected consideration 72,037 To pay off bank debt 206 Total expected payments $ 72,243 The fair value of tangible and intangible assets acquired and liabilities assumed is based on management’s estimates and assumptions. In preparing our fair value estimates of the intangible assets and certain tangible assets acquired, management, among other things, consulted an independent advisor. Valuation methods utilized include net realizable value for inventory, multi-period excess earnings method for customer relationships, the relief from royalty method for other intangible assets, and a scenario-based approach for the contingent consideration. Customer relationships are amortized over a 15-year period utilizing a percentage of excess earnings over economic life method. The corporate trademark and product trademarks are amortized over 2 years and 10 years, respectively, and developed technology is amortized over 12 years, utilizing the straight-line method as the consumption pattern of the related economic benefits cannot be reliably determined. Transaction and integration costs related to the Bergstrom acquisition are included in general and administrative expenses and were $(10,614) and $4,604 for the years ended December 31, 2023 and 2022, respectively. There were no such amounts related to this acquisition for the year ended December 31, 2021. These amounts included favorable adjustments to transaction costs of $11,300 for the year ended December 31, 2023 and an unfavorable adjustment to transaction costs of $3,565 for the year ended December 31, 2022. Kechu BidCo AS and Its Subsidiary Companies ("Kappa") On June 21, 2022, Balchem Corporation and its wholly-owned subsidiary, Balchem B.V., completed the acquisition of Kechu BidCo AS and its subsidiary companies, including Kappa Bioscience AS, a leading science-based manufacturer of specialty vitamin K2 for the human nutrition industry, headquartered in Oslo, Norway (all acquired companies collectively referred to as “Kappa”). Kappa manufactures specialty vitamin K2, which plays a crucial role in the human body for bone health, heart health and immunity. Primarily, vitamin K2 supports the transport and distribution of calcium in the body. Vitamin K2 is important at all life stages, from pregnancy and early life to healthy aging. The acquisition strengthens the Company's scientific and technical expertise, geographic reach, and marketplace leadership, which should ultimately lead to accelerated growth for the Company's portfolios within the Human Nutrition and Health segment. The Company made payments of approximately kr3,305,653 ("kr" indicates the Norwegian krone), amounting to approximately kr3,001,981 to the former shareholders and approximately kr303,672 to Kappa's lenders to pay off all Kappa bank debt. Net of cash acquired of kr63,064, total payments to the former shareholders were kr2,938,917. Net of gains on foreign currency forward contracts of $512 (see Note 20, Derivative Instruments and Hedging Activities ), these payments translated to approximately $333,112, amounting to approximately $302,464 paid to the former shareholders and approximately $30,648 to Kappa's lenders. Net of cash acquired of $6,365, total payments made to the former shareholders of Kappa were approximately $296,099. The acquisition was primarily financed through the 2018 Credit Agreement (see Note 8, Revolving Loan ). In connection with this transaction, the former shareholders of Kappa had an opportunity to receive an additional payment in 2024 if certain financial performance targets and other metrics were met. There was no contingent consideration liability recorded as of December 31, 2023. The goodwill of $216,383 that arose on the acquisition date consists largely of expected synergies, including the combined entities' experience and technical problem-solving capabilities, and acquired workforce. The goodwill is assigned to the Human Nutrition and Health business segment and is not deductible for income tax purposes. The following table summarizes the fair values of the assets acquired and liabilities assumed. The transactions were completed in Norwegian kroner ("NOK") and the amounts were translated to U.S. dollars ("USD") using the foreign currency exchange rate as of June 21, 2022. Cash and cash equivalents $ 6,365 Accounts receivable 8,036 Inventories 17,600 Property, plant and equipment 9,854 Right of use assets 3,349 Customer relationships 88,813 Developed technology 15,643 Trademarks 5,046 Other assets 2,399 Accounts payable (3,301) Bank debt (30,648) Lease liabilities (3,349) Other liabilities (4,461) Deferred income taxes, net (24,716) Goodwill 216,383 Total consideration on acquisition date 307,013 Decrease to contingent consideration liability (4,037) Net gain on foreign currency exchange forward contracts (512) Total expected consideration 302,464 Kappa bank debt paid on acquisition date 30,648 Total expected payments $ 333,112 The fair value of tangible and intangible assets acquired and liabilities assumed is based on management’s estimates and assumptions. In preparing our fair value estimates of the intangible assets and certain tangible assets acquired, management, among other things, consulted an independent advisor. Valuation methods utilized include net realizable value for inventory, multi-period excess earnings method for customer relationships, the relief from royalty method for other intangible assets, and a scenario-based approach for the contingent consideration. Customer relationships are amortized over a 15-year period utilizing a percentage of excess earnings over economic life method. The corporate trademark and product trademarks are amortized over 2 years and 10 years, respectively, and developed technology is amortized over 12 years, utilizing the straight-line method as the consumption pattern of the related economic benefits cannot be reliably determined. Transaction and integration costs related to the Kappa acquisition are included in general and administrative expenses and were $533 and $(2,306) for the years ended December 31, 2023 and 2022, respectively. There were no such amounts related to this acquisition for the year ended December 31, 2021. The amount included a favorable adjustment to transaction costs of $4,037 for the year ended December 31, 2022. The following selected unaudited pro forma information presents the consolidated results of operations as if the business combinations in 2022 had occurred as of January 1, 2021. Twelve Months ended December 31, Net Sales Net Earnings Kappa & Bergstrom actual results included in the Company's consolidated income statement in 2023 $ 59,532 $ 5,487 Kappa & Bergstrom actual results included in the Company's consolidated income statement in 2022 $ 22,158 $ (5,359) 2023 Supplemental pro forma combined financial $ 922,439 $ 116,317 2022 Supplemental pro forma combined financial $ 982,021 $ 110,181 2021 Supplemental pro forma combined financial $ 859,252 $ 90,672 The above selected unaudited pro forma information includes the following acquisition-related adjustments: (1) additional amortization of intangible assets and depreciation of fixed assets; (2) adjustments related to the fair value of the acquired inventory, (3) adjustments to interest expense on borrowings at rates in effect during the related period, factoring in estimated payments based on free cash flow, and (4) other one-time adjustments. The pro forma information presented does not purport to be indicative of the results that actually would have been attained if these acquisitions had occurred at the beginning of the periods presented and is not intended to be a projection of future results. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2023 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS’ EQUITY Stock-Based Compensation All share-based payments, including grants of stock options, are recognized in the statements of earnings as operating expenses, based on their fair values. The Company has made an estimate of expected forfeitures, based on its historical experience, and is recognizing compensation cost only for those stock-based compensation awards expected to vest. The Company’s results for the years ended December 31, 2023, 2022 and 2021 reflected the following compensation cost and such compensation cost had the following effects on net earnings: Increase/(Decrease) for the 2023 2022 2021 Cost of sales $ 1,900 $ 1,302 $ 845 Operating expenses 14,152 11,922 9,957 Net earnings (12,375) (10,214) (8,370) On December 31, 2023, the Company had one share-based compensation plan under which awards may be granted, which is described below. In June 2017, the Company’s shareholders approved the Balchem Corporation 2017 Omnibus Incentive Plan (“2017 Plan”) for officers, employees and directors of the Company and its subsidiaries. The 2017 Plan replaced the 1999 Stock Plan and amendments and restatements thereto (collectively to be referred to as the “1999 Plan"), which expired in April 2018. No further awards will be made under the 1999 Plan, and the shares that remained available for grant under the 1999 Plan will only be used to settle outstanding awards granted under the 1999 Plan and will not become available under the 2017 Plan. On June 22, 2023, the Company’s shareholders approved an amendment and restatement of the 2017 Plan (the “Amended 2017 Plan”). The Amended 2017 Plan is administered by the Compensation Committee of the Board of Directors of the Company. The Amended 2017 Plan provides as follows: (i) for a termination date of June 22, 2033; (ii) the authorization of 2,400,000 shares for future grants (which represents an increase of 800,000 shares from the amount approved under the 2017 Plan); (iii) for the making of grants of stock options, stock appreciation rights, restricted stock awards, restricted stock units, and other stock-based awards, as well as for the making of cash performance awards; (iv) except as provided by the Compensation Committee or in an employment agreement as in effect on the effective date of the Amended 2017 Plan, no automatic acceleration of outstanding awards upon the occurrence of a change in control of the Company; (v) certain annual limits on the number of shares and amount of cash that may be granted; (vi) for dividends or dividend equivalents otherwise payable on an unvested award to accrue and be paid only at such time as the vesting conditions applicable to the underlying award have been satisfied; (vii) for incentive compensation recovery if the Company is required to prepare an accounting restatement of its financial statements, in accordance with any compensation recovery policy adopted by the Company, applicable law, government regulations or national securities exchange requirements, or in the discretion of the Compensation Committee in the event of a restatement due to the Company’s material noncompliance with any financial reporting requirements under the securities laws; and (viii) for compliance with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code” or the “Code”). No option will be exercisable for longer than ten years after the date of grant. The shares to be issued upon exercise of the outstanding options have been approved, reserved and are adequate to cover all exercises. As of December 31, 2023, the Amended 2017 Plan had 1,034,260 shares available for future awards. The Company has Restricted Stock Grant Agreements with the Company's non–employee directors and certain employees. Under the Restricted Stock Grant Agreements, certain shares of the Common Stock have been granted, ranging from 70 shares to 54,000 shares, to its non-employee directors and certain employees, subject to time-based vesting requirements. The Company also has performance share (“PS”) awards, which provide the recipients the right to receive a certain number of shares of the Common Stock in the future, subject to an (1) EBITDA performance hurdle, where vesting is dependent upon the Company achieving a certain EBITDA percentage growth over the performance period, and (2) relative total shareholder return (“TSR”) market condition where vesting is dependent upon the Company’s TSR performance over the performance period (typically three years) relative to a comparator group consisting of the Russell 2000 index constituents. The fair value of each option award issued under the Company’s stock plans is estimated on the date of grant using either the Black-Scholes model or the Binomial model, whichever is deemed to be most appropriate. For the years ended December 31, 2023, 2022, and 2021, the fair value of each option grant uses the assumptions noted in the following table. Expected volatilities are based on historical volatility of the Company’s stock. The expected term of the options is based on the Company’s historical experience of employees’ exercise behavior. Dividend yields are based on the Company’s historical dividend yields. Risk-free interest rates are based on the implied yields currently available on U.S. Treasury zero coupon issues with a remaining term equal to the expected life. Year Ended December 31, Weighted Average Assumptions: 2023 2022 2021 Expected Volatility 28.1 % 30.3 % 32.9 % Expected Term (in years) 4.8 7.3 4.9 Risk-Free Interest Rate 3.9 % 2.8 % 0.5 % Dividend Yield 0.5 % 0.5 % 0.5 % The value of the restricted shares is based on the fair value of the award at the date of grant. Performance Share expense is measured based on the fair value at the date of grant utilizing a Black-Scholes methodology to produce a Monte-Carlo simulation model which allows for the incorporation of the performance hurdles that must be met before the Performance Share vests. The assumptions used in the fair value determination were risk free interest rates of 4.2%, 1.8%, and 0.2%; dividend yields of 0.5%, 0.5%, and 0.6%; volatilities of 32%, 32%, and 33%; and initial TSR’s of 4.2%, -15.7%, and 11.7% in each case for the years ended December 31, 2023, 2022, and 2021, respectively. Expense is based on the estimated number of shares expected to vest, assuming the requisite service period is rendered and the probable outcome of the performance condition is achieved. The estimate is revised if subsequent information indicates that the actual number of shares likely to vest differs from previous estimates. Expense is ultimately adjusted based on the actual achievement of service and performance targets. The Performance Shares will cliff vest 100% at the end of the third year following the grant in accordance with the performance metrics set forth. Compensation expense for stock options and stock awards is recognized on a straight-line basis over the vesting period, generally three A summary of stock option plan activity for 2023, 2022, and 2021 for all plans is as follows: 2023 2022 2021 # of Weighted Average # of Weighted Average # of Weighted Average Outstanding at beginning of year 1,045 $ 99.82 867 $ 88.19 858 $ 80.58 Granted 109 138.09 239 139.04 129 119.12 Exercised (64) 81.98 (44) 73.58 (109) 63.42 Forfeited (11) 131.79 (17) 124.89 (10) 106.93 Cancelled (1) 138.07 — — (1) 74.57 Outstanding at end of year 1,078 $ 104.38 1,045 $ 99.82 867 $ 88.19 Exercisable at end of year 720 $ 88.49 654 $ 81.95 538 $ 75.51 The aggregate intrinsic value for outstanding stock options was $47,889, $27,221 and $69,711 at December 31, 2023, 2022 and 2021, respectively, with a weighted average remaining contractual term of 5.7 years at December 31, 2023. Exercisable stock options at December 31, 2023 had an aggregate intrinsic value of $43,364 with a weighted average remaining contractual term of 4.4 years. Other information pertaining to option activity during the years ended December 31, 2023, 2022 and 2021 is as follows: Years Ended December 31, 2023 2022 2021 Weighted-average fair value of options granted $ 40.91 $ 44.77 $ 33.11 Total intrinsic value of stock options exercised ($000s) $ 3,241 $ 2,713 $ 7,866 Additional information related to stock options outstanding under all plans at December 31, 2023 is as follows: Options Outstanding Options Exercisable Range of Exercise Shares Weighted Weighted Number Weighted $54.87 - $85.33 387 3.5 $ 72.41 387 $ 72.41 $85.40 - $118.60 250 4.9 101.84 248 101.71 $118.96 - $150.85 441 8.1 133.93 85 123.47 1,078 5.7 $ 104.38 720 $ 88.49 Non-vested restricted stock activity for the years ended December 31, 2023, 2022 and 2021 is summarized below: 2023 2022 2021 Shares (000s) Weighted Shares (000s) Weighted Shares (000s) Weighted Non-vested balance at beginning of year 122 $ 124.42 166 $ 99.7 159 $ 90.71 Granted 40 137.20 46 137.17 42 123.58 Vested (42) 112.30 (82) 82.15 (24) 85.83 Forfeited (4) 128.06 (8) 118.07 (11) 90.49 Non-vested balance at end of year 116 $ 133.06 122 $ 124.42 166 $ 99.7 Non-vested performance share activity for the years ended December 31, 2023, 2022 and 2021 is summarized below: 2023 2022 2021 Shares (000s) Weighted Shares (000s) Weighted Shares (000s) Weighted Non-vested balance at beginning of year 70 $ 127.69 69 $ 110.72 71 $ 91.99 Granted 42 139.66 39 114.22 36 108.74 Vested (36) 98.84 (35) 53.17 (24) 70.64 Forfeited — — (3) 84.09 (14) 81.03 Non-vested balance at end of year 76 $ 135.25 70 $ 127.69 69 $ 110.72 As of December 31, 2023, 2022 and 2021, there was $18,817, $20,791 and $13,980, respectively, of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the plans. As of December 31, 2023, the unrecognized compensation cost is expected to be recognized over a weighted-average period of approximately 1.6 years. We estimate that share-based compensation expense for the year ended December 31, 2024 will be approximately $14,800. Repurchase of Common Stock |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2023 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories, net of reserves at December 31, 2023 and 2022 consisted of the following: 2023 2022 Raw materials $ 39,517 $ 44,477 Work in progress 3,960 3,143 Finished goods 66,044 72,048 Total inventories $ 109,521 $ 119,668 On a regular basis, the Company evaluates its inventory balances for excess quantities and obsolescence by analyzing demand, inventory on hand, sales levels and other information. Based on these evaluations, inventory balances are reserved, if necessary. The reserve for inventory was $2,463 and $2,640 at December 31, 2023 and 2022, respectively. |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment at December 31, 2023 and 2022 are summarized as follows: 2023 2022 Land $ 11,787 $ 11,415 Building 104,363 90,644 Equipment 312,704 278,851 Construction in progress 59,981 79,928 488,835 460,838 Less: Accumulated depreciation 212,796 189,483 Property, plant and equipment, net $ 276,039 $ 271,355 Geographic Area Data - Long-Lived Assets (excluding intangible assets): 2023 2022 United States $ 203,692 $ 211,588 Foreign Countries 72,347 59,767 Total $ 276,039 $ 271,355 Depreciation expense was $26,373, $24,033 and $23,295 for the years ended December 31, 2023, 2022 and 2021, respectively. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | INTANGIBLE ASSETS The Company had goodwill in the amount of $778,907 and $769,509 as of December 31, 2023 and 2022, respectively, subject to the provisions of ASC 350, “Intangibles-Goodwill and Other.” The increase in goodwill is primarily due to foreign currency translation adjustments. As of December 31, 2023 and 2022, the Company had identifiable intangible assets as follows: 2023 2022 Amortization Gross Accumulated Gross Accumulated Customer relationships and lists 10-20 $ 362,032 $ 209,651 $ 357,131 $ 190,576 Trademarks and trade names 2-17 50,286 37,773 50,058 33,416 Developed technology 5-12 41,184 17,516 40,473 16,171 Other 2-18 25,733 23,083 25,041 19,245 $ 479,235 $ 288,023 $ 472,703 $ 259,408 Amortization of identifiable intangible assets was $28,035, $27,271 and $25,092 for 2023, 2022 and 2021, respectively. Assuming no change in the gross carrying value of identifiable intangible assets, the estimated amortization expense is approximately $18,971 in 2024, $15,509 in 2025, $15,308 in 2026, $14,784 in 2027, and $14,387 in 2028. At December 31, 2023 and 2022, there were no identifiable intangible assets with indefinite useful lives as defined by ASC 350, “Intangibles-Goodwill and Other.” Identifiable intangible assets are reflected in the Company’s consolidated balance sheets under Intangible assets with finite lives, net. There were no changes to the useful lives of intangible assets subject to amortization in 2023 and 2022. The Federal Insecticide, Fungicide and Rodenticide Act, (“FIFRA”), a health and safety statute, requires that certain products within our specialty products segment must be registered with the U.S. Environmental Protection Agency (the "EPA") because they are considered pesticides. Costs of such registrations are included as other in the table above. |
EQUITY-METHOD INVESTMENT
EQUITY-METHOD INVESTMENT | 12 Months Ended |
Dec. 31, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
EQUITY-METHOD INVESTMENT | EQUITY-METHOD INVESTMENT In 2013, the Company and Eastman Chemical Company formed a joint venture (66.66% / 33.34% ownership), St. Gabriel CC Company, LLC, to design, develop, and construct an expansion of the Company’s St. Gabriel aqueous choline chloride plant. The Company contributed the St. Gabriel plant, at cost, and all continued expansion and improvements are funded by the owners. The joint venture became operational as of July 1, 2016. St. Gabriel CC Company, LLC is a Variable Interest Entity ("VIE") because the total equity at risk is not sufficient to permit the joint venture to finance its own activities without additional subordinated financial support. Additionally, voting rights (2 votes each) are not proportionate to the owners’ obligation to absorb expected losses or receive the expected residual returns of the joint venture. The Company will receive up to 2/3 of the production offtake capacity and absorbs operating expenses approximately proportional to the actual percentage of offtake. The joint venture is accounted for under the equity method of accounting since the Company is not the primary beneficiary as the Company does not have the power to direct the activities of the joint venture that most significantly impact its economic performance. The Company recognized a loss of $509, $559, and $557 for the years ended December 31, 2023, 2022, and 2021, respectively, relating to its portion of the joint venture’s expenses in other expense. The Company made capital contributions to the investment totaling $290, $355, and $85 for the years ended December 31, 2023, 2022, and 2021 respectively. The carrying value of the joint venture at December 31, 2023 and 2022 was $4,076 and $4,295, respectively, and is recorded in "Other non-current assets" on the consolidated balance sheets. |
REVOLVING LOAN
REVOLVING LOAN | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
REVOLVING LOAN | REVOLVING LOAN On June 27, 2018, the Company and a bank syndicate entered into a credit agreement (the "2018 Credit Agreement"), which provided for revolving loans up to $500,000, due on June 27, 2023. During the second quarter of 2022, the Company borrowed $345,000 under the 2018 Credit Agreement to fund the Kappa acquisition (see Note 2, Significant Acquisitions ). On July 27, 2022, the Company entered into an Amended and Restated Credit Agreement (the "2022 Credit Agreement") with certain lenders in the form of a senior secured revolving credit facility, due on July 27, 2027. The 2022 Credit Agreement allows for up to $550,000 of borrowing. The loans may be used for working capital, letters of credit, and other corporate purposes and may be drawn upon at the Company’s discretion. The Company used initial proceeds from the 2022 Credit Agreement to repay the outstanding balance of $433,569 due in June 2023 under the 2018 Credit Agreement. During the third quarter of 2022, the Company borrowed another $70,000 to fund the Bergstrom acquisition (see Note 2, Significant Acquisitions ). As of December 31, 2023 and 2022, the total balance outstanding on the 2022 Credit Agreement amounted to $309,569 and $440,569, respectively. There are no installment payments required on the revolving loans; they may be voluntarily prepaid in whole or in part without premium or penalty, and all outstanding amounts are due on the maturity date. Amounts outstanding under the 2022 Credit Agreement are subject to an interest rate equal to a fluctuating rate as defined by the 2022 Credit Agreement plus an applicable rate. The applicable rate is based upon the Company’s consolidated net leverage ratio, as defined in the 2022 Credit Agreement, and the interest rate was 6.580% at December 31, 2023. The Company is also required to pay a commitment fee on the unused portion of the revolving loan, which is based on the Company’s consolidated net leverage ratio as defined in the 2022 Credit Agreement and ranges from 0.150% to 0.225% (0.175% at December 31, 2023). The unused portion of the revolving loan amounted to $240,431 at December 31, 2023. The Company is also required to pay, as applicable, letter of credit fees, administrative agent fees, and other fees to the arrangers and lenders. Costs associated with the issuance of the revolving loans are capitalized and amortized on a straight-line basis over the term of the 2022 Credit Agreement. Capitalized costs net of accumulated amortization totaled $1,030 and $1,317 at December 31, 2023 and 2022, respectively, and are included in "Other non-current assets" on the consolidated balance sheets. Amortization expense pertaining to these costs totaled $287, $335, and $282 for the years ended December 31, 2023, 2022, and 2021, respectively, and are included in "Interest expense" in the accompanying consolidated statements of earnings. The 2022 Credit Agreement contains quarterly covenants requiring the consolidated leverage ratio to be less than a certain maximum ratio and the consolidated interest coverage ratio to exceed a certain minimum ratio. At December 31, 2023, the Company was in compliance with these covenants. Indebtedness under the Company’s loan agreements is secured by assets of the Company. |
NET EARNINGS PER COMMON SHARE
NET EARNINGS PER COMMON SHARE | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
NET EARNINGS PER COMMON SHARE | NET EARNINGS PER COMMON SHARE The following presents a reconciliation of the net earnings and shares used in calculating basic and diluted net earnings per common share: Year Ended December 31, 2023 2022 2021 Net Earnings - Basic and Diluted $ 108,543 $ 105,367 $ 96,104 Share (000s) Weighted Average Common Shares - Basic 32,108 32,019 32,215 Effect of Dilutive Securities – Stock Options, Restricted Stock, and Performance Shares 340 374 457 Weighted Average Common Shares - Diluted 32,448 32,393 32,672 Net Earnings Per Share - Basic $ 3.38 $ 3.29 $ 2.98 Net Earnings Per Share - Diluted $ 3.35 $ 3.25 $ 2.94 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company’s effective tax rate for 2023, 2022 and 2021 was 20.9%, 21.2% , and 23.3%, respectively. The decrease from 2022 to 2023 is primarily due to an increase in certain tax credits. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company regularly reviews its deferred tax assets for recoverability and would establish a valuation allowance if it believed that such assets may not be recovered, taking into consideration historical operating results, expectations of future earnings, changes in its operations and the expected timing of the reversals of existing temporary differences. The Company considers the undistributed earnings of certain non-U.S. subsidiaries to be indefinitely reinvested outside of the United States on the basis of estimates that future domestic cash generation will be sufficient to meet future domestic cash needs. However, due to prevailing economic conditions of increased interest rates and subsequent borrowing costs, the Company remitted approximately $18,000 from its Belgium subsidiary and has incurred an income tax expense of approximately $20. The remittance was used to pay down U.S. debt. The Company had unremitted foreign earnings of approximately $109,000 and $94,000 for the years ended December 31, 2023 and 2022, respectively. The determination of the unrecognized deferred tax liability on those undistributed earnings is not practicable due to its legal entity structure and the complexity of U.S. and local country tax laws. If the Company decides to change its assertion on its remaining undistributed foreign earnings, it will need to recognize the income tax effects in the period it changes its assertion. Income tax expense consists of the following: 2023 2022 2021 Current: Federal $ 27,306 $ 26,423 $ 25,019 Foreign 7,634 7,103 7,553 State 4,403 3,964 3,664 Deferred: Federal (7,737) (7,532) (3,709) Foreign (2,285) (215) (3,038) State (603) (1,361) (360) Total income tax provision $ 28,718 $ 28,382 $ 29,129 The provision for income taxes differs from the amount computed by applying the Federal statutory rate of 21% for 2023, 2022, and 2021 to earnings before income tax expense due to the following: 2023 2022 2021 Income tax at Federal statutory rate $ 28,825 $ 28,087 $ 26,299 State income taxes, net of Federal income taxes 2,513 1,862 2,406 Stock Options (1,004) (676) (924) Foreign-derived intangible income (FDII) (1,752) (1,778) (1,540) Foreign rate differential 946 2,066 1,188 Other (810) (1,179) 1,700 Total income tax provision $ 28,718 $ 28,382 $ 29,129 The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2023 and 2022 were as follows: 2023 2022 Deferred tax assets: Inventories $ 1,049 $ 1,038 Restricted stock and stock options 5,565 3,932 Lease liabilities 4,812 5,439 Research and development 12,653 4,134 Other 3,874 3,717 Total deferred tax assets 27,953 18,260 Deferred tax liabilities: Amortization $ (42,351) $ (46,688) Depreciation (28,937) (25,097) Prepaid expenses (421) (462) Foreign currency and interest rate swaps (647) (1,456) Right of use assets (4,574) (5,324) Other (3,047) (1,995) Total deferred tax liabilities (79,977) (81,022) Valuation allowance (22) (22) Net deferred tax liability $ (52,046) $ (62,784) As of December 31, 2023, the Company has state income tax net operating loss (NOL) carryforwards of $348. The state NOL carryforwards will expire between 2026 and 2035. The Company believes that the benefit from the state NOL carryforwards will not be realized, therefore, a valuation allowance has been established in the amount of $22. Provisions of ASC 740-10 clarify whether or not to recognize assets or liabilities for tax positions taken that may be challenged by a tax authority. A reconciliation of the beginning and ending amount of unrecognized tax benefits, which is included in other long-term obligations on the Company’s consolidated balance sheets, is as follows: 2023 2022 2021 Balance at beginning of period $ 5,815 $ 5,881 $ 5,335 Increases for tax positions of prior years 1,353 2,194 806 Decreases for tax positions of prior years (2,518) (2,260) (260) Balance at end of period $ 4,650 $ 5,815 $ 5,881 All of Balchem's unrecognized tax benefits, if recognized in future periods, would impact the Company's effective tax rate in such future periods. The Company recognizes both interest and penalties as part of the income tax provision. During the years ended December 31, 2023 and 2022, these amounts were reduced by $322 and $371, respectively. During the year ended December 31, 2021, this amounted to $262. As of December 31, 2023 and 2022, accrued interest and penalties were $1,413 and $1,735, respectively. Balchem files income tax returns in the U.S. and in various states and foreign countries. In the major jurisdictions where the Company operates, it is generally no longer subject to income tax examinations by tax authorities for years before 2019 and management does not anticipate any material change in the total amount of unrecognized tax benefits to occur within the next twelve months. The European Union (“EU”) member states formally adopted the EU’s Pillar Two Directive, which was established by the Organization for Economic Co-operation and Development. Pillar Two generally provides for a 15 percent minimum effective tax rate for the jurisdictions where multinational enterprises operate. While the Company does not anticipate that this will have a material impact on its tax provision or effective tax rate, the Company continues to monitor evolving tax legislation in the jurisdictions in which it operates. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION Balchem Corporation reports three reportable segments: Human Nutrition and Health, Animal Nutrition and Health, and Specialty Products. Sales and production of products outside of our reportable segments and other minor business activities are included in "Other and Unallocated." Human Nutrition and Health The Human Nutrition and Health ("HNH") segment provides human grade choline nutrients and mineral amino acid chelated products through this segment for nutrition and health applications. Choline is recognized to play a key role in the development and structural integrity of brain cell membranes in infants, processing dietary fat, reproductive development and neural functions, such as memory and muscle function. The Company's mineral amino acid chelates, specialized mineral salts, and mineral complexes are used as raw materials for inclusion in premier human nutrition products; proprietary technologies have been combined to create an organic molecule in a form the body can readily assimilate. Sales growth for human nutrition applications is reliant on differentiation from lower-cost competitive products through scientific data, intellectual property and customers' appreciation of brand value. Consequently, the Company makes investments in such activities for long-term value differentiation. This segment also manufactures specialty vitamin K2, which plays a crucial role in the human body for bone health, heart health and immunity, and methylsulfonylmethane ("MSM"), which is a widely used nutritional ingredient that helps provide benefits for joint health, sports nutrition, skin and beauty, and healthy aging. This segment also serves the food and beverage industry for beverage, bakery, dairy, confectionary, and savory manufacturers. The Company partners with its customers from ideation through commercialization to bring on-trend beverages, baked goods, confections, dairy and meat products to market. The Company has expertise in trends analysis and product development. With its strong manufacturing capabilities in customized spray dried and emulsified powders, extrusion and agglomeration, blended lipid systems, liquid flavor delivery systems, juice and dairy bases, chocolate systems, ice cream bases and variegates, the Company is a one-stop solutions provider for beverage and dairy product development needs. Additionally, this segment provides microencapsulation solutions to a variety of applications in food, pharmaceutical and nutritional ingredients to enhance performance of nutritional fortification, processing, mixing, and packaging applications and shelf-life. Major product applications are baked goods, refrigerated and frozen dough systems, processed meats, seasoning blends, confections, sports and protein bars, dietary plans, and nutritional supplements. The Company also creates cereal systems for ready-to-eat cereals, grain-based snacks, and cereal based ingredients. Animal Nutrition and Health The Company’s Animal Nutrition and Health ("ANH") segment provides nutritional products derived from its microencapsulation and chelation technologies in addition to the essential nutrient choline chloride. For ruminant animals, the Company’s microencapsulated products boost health and milk production by delivering nutrient supplements that are biologically available, providing required nutritional levels. The Company’s proprietary chelation technology provides enhanced nutrient absorption for various species of production and companion animals and is marketed for use in animal feed throughout the world. ANH also manufactures and supplies choline chloride, an essential nutrient for monogastric animal health, predominantly to the poultry, pet and swine industries. Choline, which is manufactured and sold in both dry and aqueous forms, plays a vital role in the metabolism of fat. In poultry, choline deficiency can result in reduced growth rates and perosis in young birds, while in swine production choline is a necessary and required component of gestating and lactating sow diets for both liver health and prevention of leg deformity. This segment also manufactures MSM, which is a widely used nutritional ingredient that provides benefits for pet health. Sales of value-added encapsulated products are highly dependent on overall industry economics as well as the Company's ability to leverage the results of university and field research on the animal health and production benefits of our products. Management believes that success in the commodity-oriented choline chloride marketplace is highly dependent on the Company’s ability to maintain its strong reputation for excellent product quality and customer service. The Company continues to drive production efficiencies in order to maintain its competitive-cost position to effectively compete in a competitive global marketplace. Specialty Products The Company re-packages and distributes a number of performance gases and chemicals for various uses by its customers, notably ethylene oxide, propylene oxide, and ammonia. Ethylene oxide is sold as a sterilant gas, primarily for use in the health care industry. It is used to sterilize a wide range of medical devices because of its versatility and effectiveness in treating hard or soft surfaces, composites, metals, tubing and different types of plastics without negatively impacting the performance of the device being sterilized. Contract sterilizers and medical device manufacturers are principal customers for this product. Propylene oxide is marketed and sold as a fumigant to aid in the control of insects and microbiological spoilage, to reduce bacterial and mold contamination in certain shelled and processed nut meats, processed spices, cacao beans, cocoa powder, raisins, figs and prunes, and for various chemical synthesis applications, such as increasing paint durability and manufacturing specialty starches and textile coatings. Ammonia is used primarily as a refrigerant, for heat treatment of metals and various chemical synthesis applications, and is distributed in reusable and recyclable drum and cylinder packaging approved for use in the countries these products are shipped to. The Company’s performance gases and chemicals are distributed worldwide in specially designed, reusable and recyclable drum and cylinder packaging, to assure compliance with safety, quality and environmental standards as outlined by the applicable regulatory agencies in the countries our products are shipped to. The Company’s inventory of these specially built drums and cylinders, along with its five filling facilities, represents a significant capital investment. The Company also sells single use canisters for use in sterilizing re-usable devices typically processed in autoclave units in hospitals. The Company’s micronutrient agricultural nutrition business sells chelated minerals primarily to producers of high value crops. The Company has a unique and patented two-step approach to solving mineral deficiency in plants to optimize health, yield and shelf-life. First, the Company determines optimal mineral balance for plant health. The Company then has a foliar applied Metalosate ® product range, utilizing patented amino acid chelate technology. Its products quickly and efficiently deliver mineral nutrients. As a result, the farmer/grower gets healthier crops that are more resistant to disease and pests, larger yields and healthier food for the consumer with extended shelf life for produce being shipped long distances. The segment information is summarized as follows: Business Segment Assets 2023 2022 Human Nutrition and Health $ 1,180,527 $ 1,170,238 Animal Nutrition and Health 166,994 175,972 Specialty Products 168,307 177,187 Other and Unallocated (1) 81,383 101,115 Total $ 1,597,211 $ 1,624,512 Business Segment Net Sales 2023 2022 2021 Human Nutrition and Health $ 550,751 $ 527,131 $ 442,733 Animal Nutrition and Health 238,326 262,297 226,776 Specialty Products 125,965 131,438 117,020 Other and Unallocated (2) 7,397 21,492 12,494 Total $ 922,439 $ 942,358 $ 799,023 Business Segment Earnings Before Income Taxes 2023 2022 2021 Human Nutrition and Health $ 102,419 $ 82,125 $ 76,031 Animal Nutrition and Health 27,576 36,056 26,179 Specialty Products 34,579 32,789 30,020 Other and Unallocated (2) (5,381) (5,784) (4,728) Interest and other expense (21,932) (11,437) (2,269) Total $ 137,261 $ 133,749 $ 125,233 Depreciation/Amortization 2023 2022 2021 Human Nutrition and Health $ 38,568 $ 33,728 $ 30,012 Animal Nutrition and Health 7,876 6,685 7,414 Specialty Products 7,278 7,507 8,332 Other and Unallocated (2) 1,213 3,928 3,121 Total $ 54,935 $ 51,848 $ 48,879 Capital Expenditures 2023 2022 2021 Human Nutrition and Health $ 26,415 $ 33,668 $ 23,714 Animal Nutrition and Health 6,993 10,809 8,100 Specialty Products 3,535 4,004 3,804 Other and Unallocated (2) 331 605 524 Total $ 37,274 $ 49,086 $ 36,142 (1) Other and Unallocated assets consist of certain cash, capitalized loan issuance costs, other assets, investments, and income taxes, which the Company does not allocate to its individual business segments. It also includes assets associated with a few minor businesses which individually do not meet the quantitative thresholds for separate presentation. (2) Other and Unallocated consists of a few minor businesses which individually do not meet the quantitative thresholds for separate presentation and corporate expenses that have not been allocated to a segment. Unallocated corporate expenses consist of: (i) Transaction and integration costs, ERP implementation costs, and unallocated legal fees totaling $1,617, $3,581 and $1,264 for years ended December 31, 2023 , 2022 and 2021, respectively, and (ii) Unallocated amortization expense of $312, $2,951, and $2,510 for years ended December 31, 2023 , 2022 , and 2021, respectively, related to an intangible asset in connection with a company-wide ERP system implementation. |
REVENUE
REVENUE | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE Revenue Recognition Revenues are recognized when control of the promised goods is transferred to customers, in an amount that reflects the consideration we expect to realize in exchange for those goods. The following table presents revenues disaggregated by revenue source. Sales and usage-based taxes are excluded from revenues: 2023 2022 2021 Product Sales Revenue $ 919,951 $ 939,166 $ 794,518 Royalty Revenue 2,488 3,192 4,505 Total Revenue $ 922,439 $ 942,358 $ 799,023 The following table presents revenues disaggregated by geography, based on customers' delivery addresses: 2023 2022 2021 United States $ 689,601 $ 682,238 $ 584,661 Foreign Countries 232,838 260,120 214,362 Total $ 922,439 $ 942,358 $ 799,023 Product Sales Revenues The Company’s primary operation is the manufacturing and sale of health and wellness ingredient products, in which the Company receives an order from a customer and fulfills that order. The Company’s product sales are considered point-in-time revenue. Royalty Revenues Royalty revenue consists of agreements with customers to use the Company’s intellectual property in exchange for a sales-based royalty. Royalties are considered over time revenue and are recorded in the HNH segment. Contract Liabilities The Company records contract liabilities when cash payments are received or due in advance of performance, including amounts which are refundable. The Company’s payment terms vary by the type and location of customers and the products offered. The term between invoicing and when payment is due is not significant. For certain products or services and customer types, the Company requires payment before the products are delivered to the customer. Practical Expedients and Exemptions The Company generally expenses sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within selling and marketing expenses. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which the Company recognizes revenue at the amount to which it has the right to invoice for products shipped. |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 12 Months Ended |
Dec. 31, 2023 | |
Supplemental Cash Flow Information [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | SUPPLEMENTAL CASH FLOW INFORMATION Cash paid during the year for: 2023 2022 2021 Income taxes $ 35,725 $ 33,016 $ 25,355 Interest $ 25,933 $ 11,879 $ 4,547 Non-cash financing and investing activities: 2023 2022 2021 Dividends payable $ 25,717 $ 23,129 $ 20,886 Contingent consideration liability $ — $ 11,872 $ — |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME | 12 Months Ended |
Dec. 31, 2023 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME | ACCUMULATED OTHER COMPREHENSIVE INCOME The changes in accumulated other comprehensive income (loss) were as follows: Years Ended December 31, 2023 2022 2021 Net foreign currency translation adjustment $ 16,809 $ (4,799) $ (11,255) Net change of cash flow hedge (see Note 20 for further information) Unrealized (loss) gain on cash flow hedge (1,406) 3,564 2,707 Tax 341 (868) (654) Net of tax (1,065) 2,696 2,053 Net change in postretirement benefit plan (see Note 15 for further information) Prior service loss (gain) arising during the period 132 (41) (4) Amortization of prior service gain — 9 74 Amortization of loss (gain) 8 (2) (21) Total before tax 140 (34) 49 Tax (39) (24) (13) Net of tax 101 (58) 36 Total other comprehensive income/(loss) $ 15,845 $ (2,161) $ (9,166) Included in "Net foreign currency translation adjustment" was loss of $1,455 related to a net investment hedge, which was net of tax benefit of $471 for the year ended December 31, 2023, and gains of $3,851, and $4,766, related to a net investment hedge, net of tax expenses of $1,236, and $1,527, for the years ended December 31, 2022 and 2021, respectively. See Note 20, Derivative Instruments and Hedging Activities . Accumulated other comprehensive loss at December 31, 2023 and 2022 consisted of the following: Foreign currency Cash flow hedge Postretirement benefit plan Total Balance December 31, 2022 $ (8,401) $ 1,065 $ 182 $ (7,154) Other comprehensive income (loss) 16,809 (1,065) 101 15,845 Balance December 31, 2023 $ 8,408 $ — $ 283 $ 8,691 |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS Defined Contribution Plans The Company sponsors one 401(k) savings plan for eligible employees, which allows participants to make pretax or after tax contributions and the Company matches certain percentages of those contributions. The plan also has a discretionary profit sharing portion and matches 401(k) contributions with shares of the Company’s Common Stock. All amounts contributed to the plan are deposited into a trust fund administered by independent trustees. On June 21, 2022, the Company completed the acquisition of Kappa, which sponsors one defined contribution plan for its employees. In addition, on August 30, 2022, the Company completed the acquisition of Bergstrom, which sponsored one defined contribution plan for its employees. The Bergstrom plan merged into the Company sponsored 401(k) savings plan on January 1, 2023. The Company provided for matching 401(k) savings plan contributions of $4,381, $4,363, and $4,142 in 2023, 2022 and 2021, respectively. Profit sharing contributions in 2023, 2022, and 2021 were not material. Postretirement Medical Plans The Company provides postretirement benefits in the form of two unfunded postretirement medical plans; one that is under a collective bargaining agreement and covers eligible retired employees of the Verona, Missouri facility and a plan for executive officers of the Company who meet eligibility requirements as set forth in the Company's Officer Retiree Program. The Company uses a December 31 measurement date for its postretirement medical plans. In accordance with ASC 715, “Compensation—Retirement Benefits,” the Company is required to recognize the over funded or underfunded status of a defined benefit post retirement plan (other than a multiemployer plan) as an asset or liability in its statement of financial position, and to recognize changes in that funded status in the year in which the changes occur through comprehensive income. The actuarial recorded liabilities for such unfunded postretirement benefits are as follows: Change in benefit obligation: 2023 2022 Benefit obligation at beginning of year $ 1,465 $ 1,293 Service cost with interest to end of year 108 79 Interest cost 62 26 Participant contributions 23 27 Benefits paid (30) (69) Actuarial (gain) loss (233) 109 Benefit obligation at end of year $ 1,395 $ 1,465 Change in plan assets: 2023 2022 Fair value of plan assets at beginning of year $ — $ — Employer contributions 7 42 Participant contributions 23 27 Benefits paid (30) (69) Fair value of plan assets at end of year $ — $ — Amounts recognized in consolidated balance sheet: 2023 2022 Accumulated postretirement benefit obligation $ (1,395) $ (1,465) Fair value of plan assets — — Funded status (1,395) (1,465) Unrecognized prior service cost 9 74 Unrecognized net loss (gain) (2) (24) Net amount recognized in consolidated balance sheet (after ASC 715) (included in "Other long-term obligations") $ (1,395) $ (1,465) Accrued postretirement benefit cost (included in "Other long-term obligations") N/A N/A Components of net periodic benefit cost: 2023 2022 2021 Service cost with interest to end of year $ 108 $ 79 $ 87 Interest cost 62 26 23 Amortization of prior service cost — 9 74 Amortization of loss (gain) 8 (2) (24) Total net periodic benefit cost $ 178 $ 112 $ 160 Estimated future employer contributions and benefit payments are as follows: Year 2024 $ 131 2025 132 2026 99 2027 101 2028 85 Years 2029-2033 615 Assumptions to determine benefit obligations: 2023 2022 Discount rate 4.15 % 4.40 % Assumptions to determine net cost: 2023 2022 2021 Discount rate 4.40 % 2.10 % 1.75 % Defined Benefit Pension Plans The Company contributes to one multi-employer defined benefit plan under the terms of a collective-bargaining agreement covering its union-represented employees of the Verona, Missouri facility. The risks of participation in this multiemployer plan are different from single-employer plans in the following aspects: (a) assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers, (b) if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers, and (c) if the Company was to stop participating in its multiemployer plan, the Company would be required to pay that plan an amount based on the underfunded status of the plan, referred to as the withdrawal liability. The Company’s participation in this plan for the annual period ended December 31, 2023 is outlined in the table below. The “EIN/Pension Plan Number” column provides the Employee Identification Number (EIN). The zone status is based on information that the Company received from the plan and is certified by the plan’s actuary. Among other factors, plans in the red zone or critical and declining zone are generally less than 65 percent funded, plans in the yellow zone are less than 80 percent funded, and plans in the green zone are at least 80 percent funded. The “FIP/RP Status Pending/Implemented” column indicates plans for which a financial improvement plan (FIP) or a rehabilitation plan (RP) is either pending or has been implemented. The last column lists the expiration date of the collective-bargaining agreement to which the plan is subject. Finally, the period-to-period comparability of the contributions for 2023 and 2022 was affected by a 4.0% increase in the 2023 contribution rate. There have been no other significant changes that affect the comparability of 2023 and 2022 contributions. The Company does not represent more than 5% of the contributions to this pension fund. Pension EIN/Pension Pension Plan Protection Act Zone Status FIP/RP Status Contributions of Balchem Corporation Surcharge Expiration Date of Collective- 2023 2022 2023 2022 2021 Central States, 36-6044243 Critical & Declining as of 1/1/23 Critical & Declining as of 1/1/22 Implemented $1,020 $939 $816 No 7/12/2025 The Company provides an unfunded defined benefit pension plan for employees working in Belgium. The plan provides for the payment of a lump sum at retirement or payments in case of death of the covered employees. The actuarial recorded liabilities for such unfunded defined benefit pension plan are as follows: Change in benefit obligation: 2023 2022 Benefit obligation at beginning of year $ 1,589 $ 1,859 Service cost with interest to end of year 65 44 Interest cost 65 17 Participant contributions — 27 Benefits paid (188) (60) Actuarial loss (gain) 80 (194) Exchange rate changes 49 (104) Benefit obligation at end of year $ 1,660 $ 1,589 Change in plan assets: 2023 2022 Fair value of plan assets at beginning of year $ 1,196 $ 1,175 Actual return on plan assets 56 26 Employer contributions 138 94 Participant contributions — 27 Benefits paid (188) (60) Exchange rate changes 38 (66) Fair value of plan assets at end of year $ 1,240 $ 1,196 Amounts recognized in consolidated balance sheet: 2023 2022 Benefit obligation $ (1,660) $ (1,589) Fair value of plan assets 1,240 1,196 Funded status (420) (393) Unrecognized prior service cost N/A N/A Unrecognized net (gain)/loss N/A N/A Net amount recognized in consolidated balance sheet (after ASC 715) (included in other long-term obligations) $ (420) $ (393) Accrued postretirement benefit cost (included in other long-term obligations) N/A N/A Components of net periodic benefit cost: 2023 2022 2021 Service cost with interest to end of year $ 65 $ 44 $ 67 Interest cost 65 17 14 Expected return on plan assets (42) (37) (34) Amortization of net loss — — 3 Total net periodic benefit cost $ 88 $ 24 $ 50 Estimated future benefit payments are as follows: Year 2024 $ 1 2025 52 2026 1 2027 1 2028 1 Years 2029-2033 1,096 Assumptions to determine benefit obligations: 2023 2022 Discount rate 3.45 % 4.00 % Assumptions to determine net cost: 2023 2022 2021 Discount rate 4.00 % 1.00 % 0.75 % Expected return on assets 3.25 % 3.25 % 3.25 % Deferred Compensation Plan The Company maintains an unfunded, non-qualified deferred compensation plan for the benefit of a select group of management or highly compensated employees. Assets of the plan are held in a rabbi trust, which are subject to additional risk of loss in the event of bankruptcy or insolvency of the Company. The deferred compensation liability as of December 31, 2023 and 2022 was $10,188 and $8,543, respectively, and was included in "Other long-term obligations" on the Company's balance sheet. The related rabbi trust assets were $10,188 and $8,547 as of December 31, 2023 and 2022, respectively, and were included in "Other non-current assets" on the Company's consolidated balance sheets. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES The Company is obligated to make rental payments under non-cancelable operating and finance leases. Aggregate future minimum rental payments required under these leases at December 31, 2023 are disclosed in Note 19, Leases. The Company’s Verona, Missouri facility, while held by a prior owner, Syntex Agribusiness, Inc. (“Syntex”), was designated by the U.S. Environmental Protection Agency (the "EPA") as a Superfund site and placed on the National Priorities List in 1983 because of dioxin contamination on portions of the site. Remediation was conducted by Syntex under the oversight of the EPA and the Missouri Department of Natural Resources. The Company is indemnified by the sellers under its May 2001 asset purchase agreement covering its acquisition of the Verona, Missouri facility for potential liabilities associated with the Superfund site. One of the sellers, in turn, has the benefit of certain contractual indemnification by Syntex in relation to the implementation of the above-described Superfund remedy. In June 2023, in response to a Special Notice Letter received from the EPA in 2022, BCP Ingredients, Inc. ("BCP"), the Company's subsidiary that operates the site, Syntex, EPA, and the State of Missouri entered into an Administrative Settlement Agreement and Order on Consent (“ASAOC”) for a focused remedial investigation/feasibility study ("RI/FS") under which (a) BCP will conduct a source investigation of potential source(s) of releases of 1,4-dioxane and chlorobenzene at a portion of the site and (b) BCP and Syntex will complete a RI/FS to determine a potential remedy, if any is required. Activities under the ASAOC are underway and are expected to continue for some period of time. Separately, in June 2022, the EPA conducted an inspection of BCP’s Verona, Missouri facility (“2022 EPA Inspection”) which was followed by BCP entering into an Administrative Order for Compliance on Consent (“AOC”) with the EPA in relation to its risk management program at the Verona facility. Further, in January 2023, BCP entered into an Amended AOC with the EPA whereby the parties agreed to the extension of certain timelines. BCP timely completed all requirements under the Amended AOC. In November 2023, BCP received a notice from the Environment and Natural Resources Division of the U.S Department of Justice (“DOJ”) primarily related to the 2022 EPA Inspection, which extended the opportunity to discuss alleged violations of Sections 112(r)(7) of the Clean Air Act and regulations in 40 C.F.R. Part 68, commonly known as the Risk Management Plan Rule (“RMP Rule”). BCP intends to participate in such discussions in 2024. In connection with the 2022 EPA Inspection, the Company believes that a loss contingency in this matter is probable and reasonably estimable and has recorded a loss contingency in an amount that is not material to its financial performance or operations. In addition to the above, from time to time, the Company is a party to various legal proceedings, litigation, claims and assessments. While it is not possible to predict the ultimate disposition of each of these matters, management believes that the ultimate outcome of such matters will not have a material effect on the Company's consolidated financial position, results of operations, liquidity or cash flows. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS The Company has a number of financial instruments, none of which are held for trading purposes. The Company estimates that the fair value of all financial instruments at December 31, 2023 and 2022 does not differ materially from the aggregate carrying values of its financial instruments recorded in the accompanying consolidated balance sheets. The estimated fair value amounts have been determined by the Company using available market information and appropriate valuation methodologies. Considerable judgment is necessarily required in interpreting market data to develop the estimates of fair value, and, accordingly, the estimates are not necessarily indicative of the amounts that the Company could realize in a current market exchange. The carrying value of debt approximates fair value as the interest rate is based on market and the Company’s consolidated leverage ratio. The Company’s financial instruments also include cash equivalents, accounts receivable, accounts payable, and accrued liabilities, which are carried at cost and approximate fair value due to the short-term maturity of these instruments. Cash and cash equivalents at December 31, 2023 and 2022 included $959 and $934 in money market funds and other interest-bearing deposit accounts, respectively. Non-current assets at December 31, 2023 and 2022 included $10,188 and $8,547, respectively, of rabbi trust funds related to the Company's deferred compensation plan. The money market and rabbi trust funds are valued using level one inputs, as defined by ASC 820, “Fair Value Measurement.” The contingent consideration liabilities included on the balance sheet at of December 31, 2023 and 2022 amount to $100 and $11,400, respectively, and were valued using level three inputs, as defined by ASC 820, "Fair Value Measurement". The Company also had derivative financial instruments, consisting of a cross-currency swap and an interest rate swap, which were included in "Derivative assets" in the Company's consolidated balance sheets. The fair values of these derivative instruments were determined based on Level 2 inputs, using significant inputs that are observable either directly or indirectly, including interest rate curves and implied volatilities. The Company settled its cross-currency swap and interest rate swap on June 27, 2023 and had no other derivatives outstanding as of December 31, 2023. The derivative assets related to the cross-currency swap and the interest rate swap were $4,587 and $1,406 at December 31, 2022, respectively. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS The Company provides services under a contractual agreement to St. Gabriel CC Company, LLC. These services include accounting, information technology, quality control, and purchasing services, as well as operation of the St. Gabriel CC Company, LLC plant. The Company also sells raw materials to St. Gabriel CC Company, LLC. These raw materials are used in the production of finished goods that are, in turn, sold by Saint Gabriel CC Company, LLC to the Company for resale to unrelated parties. As such, the sale of these raw materials to St. Gabriel CC Company, LLC in this scenario lacks economic substance and therefore the Company does not include them in net sales within the consolidated statements of earnings. Payments for the services the Company provided amounted to $4,363, $4,213, and $3,637, respectively, for the years ended December 31, 2023, 2022, and 2021. The raw materials purchased and subsequently sold amounted to $34,219, $39,853, and $27,915, respectively, for the years ended December 31, 2023, 2022, and 2021. These services and raw materials are primarily recorded in cost of goods sold, net of the finished goods received from St. Gabriel CC Company, LLC of $28,099, $29,062, and $22,043, respectively, for the years ended December 31, 2023, 2022, and 2021. At December 31, 2023 and 2022, the Company had receivables of $8,314 and $8,820, respectively, recorded in accounts receivable from St. Gabriel CC Company, LLC for services rendered and raw materials sold. At December 31, 2023 and 2022, the Company had payables of $6,050 and $5,224, |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
LEASES | LEASES The Company has both real estate leases and equipment leases. The main types of equipment leases include forklifts, trailers, printers and copiers, railcars, and trucks. Leases are categorized as both operating leases and finance leases. As a result of electing the practical expedient within ASU 2016-02, variable lease payments are combined and recognized on the balance sheet in the event that those charges and any related increases are explicitly stated in the lease. Such payments include common area maintenance charges, property taxes, and insurance charges and are recorded in the right of use asset and corresponding liability when the payments are stated in the lease with (a) fixed or in-substance fixed amounts, or (b) a variable payment based on an index or rate. Due to the acquisitive nature of the Company and the potential for synergies upon integration of acquired entities, the Company determined that the reasonably certain criterion could not be met for any renewal periods beginning two years from December 31, 2023. In addition, the Company has historically not been exercising purchase options under the equipment leases as it does not make economic sense to buy the equipment. Instead, the Company has historically replaced the equipment with new leases. Therefore, the Company determined that the reasonably certain criterion could not be met as it relates to purchase options. The Company has no residual value guarantees in lease transactions. The Company did not identify any embedded leases. As indicated above, the Company elected the practical expedient to combine lease and non-lease components and recognizes the combined amount on the consolidated balance sheet. Management determined that since the Company has a centralized treasury function, the parent company would either fund or guarantee a subsidiary's loan for borrowing over a similar term. As such, the Company's management determined it is appropriate to utilize a corporate based borrowing rate for all locations. The Company developed four tranches of leases based on lease terms and these tranches reflect the composition of the current lease portfolio. The Company's borrowing history shows that interest rates of a term loan or a line of credit depend on the duration of the loan rather than the nature of the assets purchased by those funds. Based on this understanding, the Company elected to use a portfolio approach to discount rates, applying corporate rates to the tranches of leases based on lease terms. Based on the Company's risk rating, the company applied the following discount rates for new leases entered into during 2023: (1) 1-2 years, 5.45%-6.72% (2) 3-4 years, 6.04%-7.31% (3) 5-9 years, 6.38%-7.65% and (4) 10+ years, 7.10%-8.37%. Right of use assets and lease liabilities at December 31, 2023 and 2022 are summarized as follows: Right of use assets 2023 2022 Operating leases $ 17,763 $ 17,094 Finance lease 2,101 2,338 Total $ 19,864 $ 19,432 Lease liabilities - current 2023 2022 Operating leases $ 3,949 $ 3,796 Finance lease 272 226 Total $ 4,221 $ 4,022 Lease liabilities - non-current 2023 2022 Operating leases $ 14,601 $ 13,806 Finance lease 1,943 2,213 Total $ 16,544 $ 16,019 For the years ended December 31, 2023, 2022, and 2021, the Company's total lease costs were as follows, which included both amounts recognized in profits or losses during the period and amounts capitalized on the balance sheet, and the cash flows arising from lease transactions: Year ended December 31, 2023 2022 2021 Lease Cost Operating lease cost $ 5,307 $ 4,478 $ 3,143 Finance Lease cost Amortization of ROU asset 242 210 210 Interest on lease liabilities 115 125 129 Total finance lease 357 335 339 Total lease cost $ 5,664 $ 4,813 $ 3,482 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 4,757 $ 4,269 $ 3,097 Operating cash flows from finance leases 115 125 129 Financing cash flows from finance leases 222 177 159 $ 5,094 $ 4,571 $ 3,385 ROU assets obtained in exchange for new operating lease liabilities, net of ROU asset disposals $ 6,365 $ 11,488 $ 3,804 Weighted-average remaining lease term - operating leases 9.33 years 5.63 years 4.21 years Weighted-average remaining lease term - finance leases 9.07 years 9.95 years 11.41 years Weighted-average discount rate - operating leases 7.4 % 2.7 % 3.5 % Weighted-average discount rate - finance leases 5.0 % 5.0 % 5.1 % Rent expense charged to operations under operating lease agreements for 2023, 2022, and 2021 aggregated approximately $5,307, $4,478, and $3,143, respectively. Aggregate future minimum rental payments required under non-cancelable operating and finance leases at December 31, 2023 are as follows: Year 2024 $ 5,407 2025 4,219 2026 3,638 2027 2,736 2028 2,219 Thereafter 7,717 Total minimum lease payments $ 25,936 |
LEASES | LEASES The Company has both real estate leases and equipment leases. The main types of equipment leases include forklifts, trailers, printers and copiers, railcars, and trucks. Leases are categorized as both operating leases and finance leases. As a result of electing the practical expedient within ASU 2016-02, variable lease payments are combined and recognized on the balance sheet in the event that those charges and any related increases are explicitly stated in the lease. Such payments include common area maintenance charges, property taxes, and insurance charges and are recorded in the right of use asset and corresponding liability when the payments are stated in the lease with (a) fixed or in-substance fixed amounts, or (b) a variable payment based on an index or rate. Due to the acquisitive nature of the Company and the potential for synergies upon integration of acquired entities, the Company determined that the reasonably certain criterion could not be met for any renewal periods beginning two years from December 31, 2023. In addition, the Company has historically not been exercising purchase options under the equipment leases as it does not make economic sense to buy the equipment. Instead, the Company has historically replaced the equipment with new leases. Therefore, the Company determined that the reasonably certain criterion could not be met as it relates to purchase options. The Company has no residual value guarantees in lease transactions. The Company did not identify any embedded leases. As indicated above, the Company elected the practical expedient to combine lease and non-lease components and recognizes the combined amount on the consolidated balance sheet. Management determined that since the Company has a centralized treasury function, the parent company would either fund or guarantee a subsidiary's loan for borrowing over a similar term. As such, the Company's management determined it is appropriate to utilize a corporate based borrowing rate for all locations. The Company developed four tranches of leases based on lease terms and these tranches reflect the composition of the current lease portfolio. The Company's borrowing history shows that interest rates of a term loan or a line of credit depend on the duration of the loan rather than the nature of the assets purchased by those funds. Based on this understanding, the Company elected to use a portfolio approach to discount rates, applying corporate rates to the tranches of leases based on lease terms. Based on the Company's risk rating, the company applied the following discount rates for new leases entered into during 2023: (1) 1-2 years, 5.45%-6.72% (2) 3-4 years, 6.04%-7.31% (3) 5-9 years, 6.38%-7.65% and (4) 10+ years, 7.10%-8.37%. Right of use assets and lease liabilities at December 31, 2023 and 2022 are summarized as follows: Right of use assets 2023 2022 Operating leases $ 17,763 $ 17,094 Finance lease 2,101 2,338 Total $ 19,864 $ 19,432 Lease liabilities - current 2023 2022 Operating leases $ 3,949 $ 3,796 Finance lease 272 226 Total $ 4,221 $ 4,022 Lease liabilities - non-current 2023 2022 Operating leases $ 14,601 $ 13,806 Finance lease 1,943 2,213 Total $ 16,544 $ 16,019 For the years ended December 31, 2023, 2022, and 2021, the Company's total lease costs were as follows, which included both amounts recognized in profits or losses during the period and amounts capitalized on the balance sheet, and the cash flows arising from lease transactions: Year ended December 31, 2023 2022 2021 Lease Cost Operating lease cost $ 5,307 $ 4,478 $ 3,143 Finance Lease cost Amortization of ROU asset 242 210 210 Interest on lease liabilities 115 125 129 Total finance lease 357 335 339 Total lease cost $ 5,664 $ 4,813 $ 3,482 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 4,757 $ 4,269 $ 3,097 Operating cash flows from finance leases 115 125 129 Financing cash flows from finance leases 222 177 159 $ 5,094 $ 4,571 $ 3,385 ROU assets obtained in exchange for new operating lease liabilities, net of ROU asset disposals $ 6,365 $ 11,488 $ 3,804 Weighted-average remaining lease term - operating leases 9.33 years 5.63 years 4.21 years Weighted-average remaining lease term - finance leases 9.07 years 9.95 years 11.41 years Weighted-average discount rate - operating leases 7.4 % 2.7 % 3.5 % Weighted-average discount rate - finance leases 5.0 % 5.0 % 5.1 % Rent expense charged to operations under operating lease agreements for 2023, 2022, and 2021 aggregated approximately $5,307, $4,478, and $3,143, respectively. Aggregate future minimum rental payments required under non-cancelable operating and finance leases at December 31, 2023 are as follows: Year 2024 $ 5,407 2025 4,219 2026 3,638 2027 2,736 2028 2,219 Thereafter 7,717 Total minimum lease payments $ 25,936 |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 12 Months Ended |
Dec. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES On May 28, 2019, the Company entered into a pay-fixed (2.05%), receive-floating interest rate swap with a notional amount of $108,569 and a maturity date of June 27, 2023, which was designated as cash flow hedge. The net interest income related to the interest rate swap contract were $1,518 and $400 for the years ended December 31, 2023 and 2022, respectively. The net interest expense related to the interest rate swap contract was $2,144 for the year ended December 31, 2021. The net interest income and expense were recorded in the consolidated statements of earnings under "Interest expense, net." On May 28, 2019, the Company also entered into a pay-fixed (0.00%), receive-fixed (2.05%) cross-currency swap to manage foreign exchange risk related to the Company's net investment in Chemogas, which was designated as net investment hedge. The derivative has a notional amount of $108,569, an effective date of May 28, 2019, and a maturity date of June 27, 2023. The interest income related to the cross-currency swap contract was $1,119, $2,250, and $2,257 for the years ended December 31, 2023, 2022, and 2021, respectively. The interest income was recorded in the consolidated statements of earnings under "Interest expense, net." The Company settled its derivative instruments on their maturity date of June 27, 2023 and had no other derivatives outstanding as of December 31, 2023. The proceeds from the settlement of the cross-currency swap in the amount of $2,740 were classified as investing activities in the Consolidated Statements of Cash Flows. As of December 31, 2022, the fair value of the derivative instruments is presented as follows in the Company's consolidated balance sheets: Derivative assets December 31, 2022 Interest rate swap $ 1,406 Cross-currency swap 4,587 Derivative assets $ 5,993 Gains and losses on our hedging instruments were recognized in accumulated other comprehensive income (loss) and categorized as follows for the years ended December 31, 2023, 2022, and 2021: Location within Statements of Comprehensive Income Year ended December 31, 2023 2022 2021 Cash flow hedge (interest rate swap), net of tax Unrealized (loss) gain on cash flow hedge, net $ (1,065) $ 2,696 $ 2,053 Net investment hedge (cross-currency swap), net of tax Net foreign currency translation adjustment (1,455) 3,851 4,766 $ (2,520) $ 6,547 $ 6,819 In connection with the Kappa acquisition (see Note 2, Significant Acquisitions |
QUARTERLY FINANCIAL INFORMATION
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | 12 Months Ended |
Dec. 31, 2023 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (In thousands, except per share data) 2023 2022 First Second Third Fourth First Second Third Fourth Net sales $ 232,540 $ 231,252 $ 229,948 $ 228,699 $ 228,867 $ 236,693 $ 244,267 $ 232,531 Gross margin 73,170 77,349 76,544 74,993 71,506 71,876 68,430 68,639 Earnings before income taxes 29,119 38,400 36,475 33,267 37,630 39,258 31,085 25,776 Net earnings 22,710 30,110 29,075 26,648 28,930 29,782 25,249 21,406 Basic net earnings per common share $ 0.71 $ 0.94 $ 0.91 $ 0.83 $ 0.90 $ 0.93 $ 0.79 $ 0.67 Diluted net earnings per common share $ 0.70 $ 0.93 $ 0.90 $ 0.82 $ 0.89 $ 0.92 $ 0.78 $ 0.66 |
VALUATION AND QUALIFYING ACCOUN
VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2023 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
VALUATION AND QUALIFYING ACCOUNTS | Allowance Inventory Balance - December 31, 2020 $ 2,092 $ 2,782 Additions charged to costs and expenses 180 7,312 Adjustments/deductions (a) (1,344) (8,669) Balance - December 31, 2021 928 1,425 Additions charged to costs and expenses 401 6,786 Adjustments/deductions (a) (103) (5,571) Balance - December 31, 2022 1,226 2,640 Additions charged to costs and expenses 37 2,450 Adjustments/deductions (a) (355) (2,627) Balance - December 31, 2023 $ 908 $ 2,463 (a) Represents write-offs and other adjustments |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||||||||||
Net earnings | $ 26,648 | $ 29,075 | $ 30,110 | $ 22,710 | $ 21,406 | $ 25,249 | $ 29,782 | $ 28,930 | $ 108,543 | $ 105,367 | $ 96,104 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
BUSINESS DESCRIPTION AND SUMM_2
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation |
Revenue Recognition and Cost of Sales | Revenue Recognition Revenue for each of the Company’s business segments is recognized when control of the promised goods is transferred to our customers, in an amount that reflects the consideration we expect to realize in exchange for those goods. The Company reports amounts billed to customers related to shipping and handling as revenue and includes costs incurred for shipping and handling in cost of sales. Amounts received for unshipped merchandise are not recognized as revenue but rather they are recorded as customer deposits and are included in current liabilities. In instances of shipments made on consignment, revenue is recognized when control is transferred to the customer. In accordance with Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers , revenue-generating contracts are assessed to identify distinct performance obligations, allocating transaction prices to those performance obligations, and criteria for satisfaction of a performance obligation. The standard allows for recognition of revenue only when we have satisfied a performance obligation through transferring control of the promised good or service to a customer. Control, in this instance, may mean the ability to prevent other entities from directing the use of, and receiving benefit from, a good or service. The standard indicates that an entity must determine at contract inception whether it will transfer control of a promised good or service over time or satisfy the performance obligation at a point in time through analysis of the following criteria: (i) the entity has a present right to payment, (ii) the customer has legal title, (iii) the customer has physical possession, (iv) the customer has the significant risks and rewards of ownership and (v) the customer has accepted the asset. The Company assesses collectability based primarily on the customer’s payment history and on the creditworthiness of the customer. Cost of Sales Cost of sales are primarily comprised of raw materials and supplies consumed in the manufacture of product, as well as manufacturing labor, maintenance labor, depreciation expense, and direct overhead expense necessary to convert purchased materials and supplies into finished product. Cost of sales also includes inbound freight costs, outbound freight costs for shipping products to customers, warehousing costs, quality control and obsolescence expense. |
Cash and Cash Equivalents | Cash and Cash Equivalents |
Accounts Receivable | Accounts Receivable |
Inventories | Inventories Inventories are valued at the lower of cost (first in, first out) or net realizable value and have been reduced by an allowance for excess or obsolete inventories. Cost elements include material, labor and manufacturing overhead. |
Property, Plant and Equipment and Depreciation | Property, Plant and Equipment and Depreciation Property, plant and equipment are stated at cost. Depreciation of plant and equipment is calculated using the straight-line method over the estimated useful lives of the assets as follows: Buildings 15-25 years Equipment 2-28 years Expenditures for repairs and maintenance are charged to expense. Alterations and major overhauls that extend the lives or increase the capacity of plant assets are capitalized. When assets are retired or otherwise disposed of, the cost of the assets and the related accumulated depreciation are removed from the accounts and any resultant gain or loss is included in earnings from operations. |
Business Concentrations | Business Concentrations Financial instruments that subject the Company to credit risk consist primarily of accounts receivable and money market investments. Investments are managed within established guidelines to mitigate risks. Accounts receivable subject the Company to credit risk partially due to the concentration of amounts due from customers. The Company extends credit to its customers based upon an evaluation of the customers’ financial condition and credit histories. In 2023, 2022 and 2021, no customer accounted for more than 10% of total net sales or accounts receivable. |
Post-employment Benefits | Post-employment Benefits We provide life insurance, health care benefits, and defined benefit pension plan payments for certain eligible retirees and health care benefits for certain retirees’ eligible survivors. The costs and obligations related to these benefits reflect our assumptions as to health care cost trends and key economic conditions including discount rates, expected rate of return on plan assets, and expected salary increases. The cost of providing plan benefits also depends on demographic assumptions including retirements, mortality, turnover, and plan participation. If actual experience differs from these assumptions, the cost of providing these benefits could increase or decrease. In accordance with ASC 715, “Compensation-Retirement Benefits,” we are required to recognize the overfunded or underfunded status of a defined benefit post retirement plan (other than a multiemployer plan) as an asset or liability in our statement of financial position, and to recognize changes in that funded status in the year in which the changes occur through comprehensive income. |
Goodwill and Acquired Intangible Assets | Goodwill and Acquired Intangible Assets Goodwill represents the excess of purchase price over the fair value of net assets acquired in accordance with ASC 805, "Business Combinations". Goodwill and intangible assets acquired in a business combination that have indefinite useful lives are not amortized but are instead assessed for impairment annually and more frequently if events and circumstances indicate that the assets might be impaired, in accordance with the provisions of ASC 350, "Intangibles-Goodwill and Other". The Company performed its annual test as of October 1. ASC 350 also requires that intangible assets with estimable useful lives be amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment if events and circumstances indicate that the assets might be impaired. In January 2017, the FASB issued ASU No. 2017-04, “Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”), which addresses changes to the testing for goodwill impairment by eliminating Step 2 of the process. In accordance with this update, a goodwill impairment test will be performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value. As of October 1, 2023 and 2022, the Company opted to bypass the qualitative assessment and proceeded directly to performing the quantitative goodwill impairment test. The Company assessed the fair values of its reporting units by utilizing the income approach, based on a discounted cash flow valuation model as the basis for its conclusions. The Company's estimates of future cash flows included significant management assumptions such as revenue growth rates, operating margins, discount rates, estimated terminal values and future economic and market conditions. The Company's assessment concluded that the fair values of the reporting units exceeded their carrying amounts, including goodwill. Accordingly, the goodwill of the reporting units was not considered impaired as of October 1, 2023 and 2022. The Company may resume performing the qualitative assessment in subsequent periods. The following intangible assets with finite lives are stated at cost and are amortized either on an accelerated basis or on a straight-line basis over the following estimated useful lives: Amortization Period Customer relationships and lists 10 - 20 Trademarks and trade names 2 - 17 Developed technology 5 - 12 Regulatory registration costs 5 - 10 Patents and trade secrets 15 - 17 Other 2 - 18 |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the fiscal year in which those temporary differences are expected to be recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. In evaluating our ability to recover our deferred tax assets, in full or in part, we consider all available positive and negative evidence, including our past operating results, our forecast of future market growth, forecasted earnings, future taxable income, and prudent and feasible tax planning strategies. The assumptions utilized in determining future taxable income require judgment and are consistent with the plans and estimates we are using to manage the underlying businesses. We recognize uncertain income tax positions taken on income tax returns at the largest amount that is more likely than not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a fifty percent likelihood of being sustained. Our policy for recording interest and penalties associated with uncertain tax positions is to record such items as a component of our income tax provision. |
Use of Estimates | Use of Estimates Management is required to make certain estimates and assumptions during the preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America. These estimates and assumptions impact the reported amount of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and revenues and expenses during the reporting period. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Actual results could differ from those estimates. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company has a number of financial instruments, none of which are held for trading purposes. The estimated fair value amounts have been determined by the Company using available market information and appropriate valuation methodologies. Considerable judgment is required in interpreting market data to develop the estimates of fair value, and, accordingly, the estimates are not necessarily indicative of the amounts that the Company could realize in a current market exchange. The carrying value of debt approximates fair value as the interest rate is based on market and the Company’s consolidated leverage ratio. The Company’s financial instruments also include cash equivalents, accounts receivable, accounts payable and accrued liabilities, and are carried at cost which approximates fair value due to the short-term maturity of these instruments. In addition, non-current assets includes rabbi trust funds related to the Company's deferred compensation plan. The money market and rabbi trust funds are valued using level one inputs, as defined by ASC 820, "Fair Value Measurement." The Company also had derivative financial instruments, consisting of a cross-currency swap and an interest rate swap, which were included in derivative assets and derivative liabilities, in the consolidated balance sheets (see Note 20, Derivative Instruments and Hedging Activities ). The fair values of these derivative instruments were determined based on Level 2 inputs, using significant inputs that were observable either directly or indirectly, including interest rate curves and implied volatilities. These derivatives were settled on their maturity date on June 27, 2023 and there were no other derivatives outstanding as of December 31, 2023. |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses Selling expenses consist primarily of compensation and benefit costs, amortization of customer relationships and lists, trade promotions, advertising, commissions and other marketing costs. General and administrative expenses consist primarily of payroll and benefit costs, occupancy and operating costs of corporate offices, depreciation and amortization expense on non-manufacturing assets, information systems costs and other miscellaneous administrative costs. |
Research and Development | Research and Development Research and development costs are associated directly with the Company's efforts to develop, design, and enhance its products, services, technologies, or processes. Such costs are expensed as incurred. |
Net Earnings Per Common Share | Net Earnings Per Common Share Basic net earnings per common share is calculated by dividing net earnings by the weighted average number of common shares outstanding during the period. Diluted net earnings per common share is calculated in a manner consistent with basic net earnings per common share except that the weighted average number of common shares outstanding also includes the dilutive effect of stock options outstanding, unvested restricted stock, and unvested performance shares (using the treasury stock method). |
Stock-based Compensation | Stock-based Compensation The Company has stock-based employee compensation plans, which are described more fully in Note 3, Stockholders' Equity . The Company accounts for stock-based compensation in accordance with ASC 718, “Compensation-Stock Compensation,” which requires all share-based payments, including grants of stock options, to be recognized in the statement of earnings as an operating expense, based on their fair values. The Company estimates the fair value of each option award on the date of grant using either the Black-Scholes model or the Binomial model, whichever is deemed to be most appropriate. Estimates of and assumptions about forfeiture rates, terms, volatility, interest rates and dividend yields are used to calculate stock-based compensation. A significant change to these estimates could materially affect the Company’s operating results. |
Impairment of Long-lived Assets | Impairment of Long-lived Assets |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities The Company is exposed to market fluctuations in interest rates as well as variability in foreign exchange rates. In May 2019, the Company entered into an interest rate swap with JP Morgan Chase, N.A. (the "Swap Counterparty") and a cross-currency swap with JP Morgan Chase, N.A. (the "Bank Counterparty"). The Company's primary objective for holding derivative financial instruments was to manage interest rate risk and foreign currency risk. The Company does not enter into derivative financial instruments for trading or speculative purposes. The derivative instruments were with the above single counterparty and were subject to a contractual agreement that provided for the net settlement of all contracts through a single payment in a single currency in the event of default on or termination of any one contract. As such, the derivative instruments were categorized as a master netting arrangement and presented as a net derivative asset or derivative liability on the consolidated balance sheet as of December 31, 2022. The Company settled its derivative instruments on their maturity date of June 27, 2023 and had no other derivatives outstanding as of December 31, 2023. On a quarterly basis through their maturity, we assessed the effectiveness of the hedging relationships for the interest rate swap and cross-currency swap by reviewing the critical terms indicated in the applicable agreement. The hedging relationships were determined to be highly effective. As such, the net change in fair values of the interest rate swap, that qualified as a cash flow hedge, was recorded in accumulated other comprehensive income/(loss) and subsequently reclassified into interest expense as interest payments were made on our debt. For the cross-currency swap, the amounts that have not yet been recognized in earnings remain in the cumulative translation adjustment section of accumulated other comprehensive income until the hedged net investment is sold or liquidated in accordance with paragraphs 815-35-35-5A, "Derivatives and Hedging - Net Investment Hedges", and 830-30-40-1 through 40-1A, "Foreign Currency Matters - Derecognition". Refer to Note 20, Derivative Instruments and Hedging Activities , for detailed information about our derivative financial instruments. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740) - Improvements to Income Tax Disclosures." The new guidance is intended to enhance the transparency and decision usefulness of income tax disclosures by requiring disaggregated information about a reporting entity's effective tax rate reconciliation and information on income taxes paid. The amendment is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendment in this Update should be applied on a prospective basis, with retrospective application permitted. The Company is in the process of evaluating the impact that the adoption of ASU 2023-09 will have to the financial statements and related disclosures. In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures." The ASU expands reportable segment disclosure requirements by requiring disclosures of significant reportable segment expenses that are regularly provided to the Chief Operating Decision Maker (“CODM”) and included within each reported measure of a segment's profit or loss. The ASU also requires disclosure of the title and position of the individual identified as the CODM and an explanation of how the CODM uses the reported measures of a segment's profit or loss in assessing segment performance and deciding how to allocate resources. Additionally, ASU 2023-07 requires all segment profit or loss and assets disclosures to be provided on an annual and interim basis. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning December 15, 2024. Early adoption is permitted and the amendments must be applied retrospectively to all prior periods presented. The adoption of this guidance will not affect the Company's consolidated results of operations, financial position or cash flows. The Company is currently evaluating the effect the guidance will have on its disclosures. In August 2023, the FASB issued ASU 2023-05, "Business Combinations - Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement." The new guidance applies to the formation of a joint venture and requires a joint venture to initially measure all contributions received upon its formation at fair value. The guidance is intended to reduce diversity in practice and is applicable to joint venture entities with a formation date on or after January 1, 2025 on a prospective basis. While ASU 2023-05 is not currently applicable to Balchem, the Company will apply this guidance in future reporting periods after the guidance is effective to any future arrangements meeting the definition of a joint venture. 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", and in December 2022 subsequently issued ASU 2022-06, “Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848.” These ASU’s provide temporary optional guidance to ease the potential burden in accounting for reference rate reform. The Standards Updates provide optional expedients and exceptions for applying accounting principles generally accepted in the United States to contract modifications and hedging relationships that reference LIBOR or another reference rate that are expected to be discontinued. The Standards Updates were effective upon issuance and can generally be applied through December 31, 2024. Due to the discontinuation of LIBOR and under the relief provided by Topic 848, during the third quarter of 2022, the Company modified its interest rate swap and replaced LIBOR with 1-month CME Term SOFR. The modification of the agreement did not have a significant impact on the Company's consolidated financial statements and disclosures. The interest rate swap matured on June 27, 2023. |
BUSINESS DESCRIPTION AND SUMM_3
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Plant and Equipment Estimated Useful Lives | Depreciation of plant and equipment is calculated using the straight-line method over the estimated useful lives of the assets as follows: Buildings 15-25 years Equipment 2-28 years Property, plant and equipment at December 31, 2023 and 2022 are summarized as follows: 2023 2022 Land $ 11,787 $ 11,415 Building 104,363 90,644 Equipment 312,704 278,851 Construction in progress 59,981 79,928 488,835 460,838 Less: Accumulated depreciation 212,796 189,483 Property, plant and equipment, net $ 276,039 $ 271,355 |
Summary of Goodwill | The Company had goodwill in the amount of $778,907 and $769,509 as of December 31, 2023 and 2022, respectively, subject to the provisions of ASC 350, “Intangibles-Goodwill and Other.” Goodwill at December 31, 2021 $ 523,949 Goodwill as a result of the Kappa acquisition 216,295 Goodwill as a result of the Bergstrom acquisition 31,209 Impact due to change in foreign exchange rates (1,944) Goodwill at December 31, 2022 769,509 Goodwill as a result of the Bergstrom acquisition 341 Impact due to change in foreign exchange rates 9,057 Goodwill at December 31, 2023 $ 778,907 December 31, 2023 December 31, 2022 HNH $ 673,207 $ 665,804 ANH 24,469 24,218 Specialty Products 81,175 79,429 Other and Unallocated 56 58 Total $ 778,907 $ 769,509 |
Intangible Assets Estimated Useful Lives | The following intangible assets with finite lives are stated at cost and are amortized either on an accelerated basis or on a straight-line basis over the following estimated useful lives: Amortization Period Customer relationships and lists 10 - 20 Trademarks and trade names 2 - 17 Developed technology 5 - 12 Regulatory registration costs 5 - 10 Patents and trade secrets 15 - 17 Other 2 - 18 As of December 31, 2023 and 2022, the Company had identifiable intangible assets as follows: 2023 2022 Amortization Gross Accumulated Gross Accumulated Customer relationships and lists 10-20 $ 362,032 $ 209,651 $ 357,131 $ 190,576 Trademarks and trade names 2-17 50,286 37,773 50,058 33,416 Developed technology 5-12 41,184 17,516 40,473 16,171 Other 2-18 25,733 23,083 25,041 19,245 $ 479,235 $ 288,023 $ 472,703 $ 259,408 |
SIGNIFICANT ACQUISITIONS (Table
SIGNIFICANT ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the fair values of the assets acquired and liabilities assumed: Cash and cash equivalents $ 773 Accounts receivable 4,699 Inventories 3,972 Property, plant and equipment 2,243 Right of use assets 866 Customer relationships 29,900 Developed technology 4,600 Trademarks 2,300 Other assets 197 Accounts payable (699) Bank debt (206) Lease liabilities (871) Other liabilities (462) Goodwill 31,550 Total consideration on acquisition date and working capital adjustment 78,862 Net decrease to contingent consideration liability and other post-closing payments (6,825) Total expected consideration 72,037 To pay off bank debt 206 Total expected payments $ 72,243 The following table summarizes the fair values of the assets acquired and liabilities assumed. The transactions were completed in Norwegian kroner ("NOK") and the amounts were translated to U.S. dollars ("USD") using the foreign currency exchange rate as of June 21, 2022. Cash and cash equivalents $ 6,365 Accounts receivable 8,036 Inventories 17,600 Property, plant and equipment 9,854 Right of use assets 3,349 Customer relationships 88,813 Developed technology 15,643 Trademarks 5,046 Other assets 2,399 Accounts payable (3,301) Bank debt (30,648) Lease liabilities (3,349) Other liabilities (4,461) Deferred income taxes, net (24,716) Goodwill 216,383 Total consideration on acquisition date 307,013 Decrease to contingent consideration liability (4,037) Net gain on foreign currency exchange forward contracts (512) Total expected consideration 302,464 Kappa bank debt paid on acquisition date 30,648 Total expected payments $ 333,112 |
Schedule of Pro Forma Information | The following selected unaudited pro forma information presents the consolidated results of operations as if the business combinations in 2022 had occurred as of January 1, 2021. Twelve Months ended December 31, Net Sales Net Earnings Kappa & Bergstrom actual results included in the Company's consolidated income statement in 2023 $ 59,532 $ 5,487 Kappa & Bergstrom actual results included in the Company's consolidated income statement in 2022 $ 22,158 $ (5,359) 2023 Supplemental pro forma combined financial $ 922,439 $ 116,317 2022 Supplemental pro forma combined financial $ 982,021 $ 110,181 2021 Supplemental pro forma combined financial $ 859,252 $ 90,672 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Compensation Cost on Net Earnings | The Company’s results for the years ended December 31, 2023, 2022 and 2021 reflected the following compensation cost and such compensation cost had the following effects on net earnings: Increase/(Decrease) for the 2023 2022 2021 Cost of sales $ 1,900 $ 1,302 $ 845 Operating expenses 14,152 11,922 9,957 Net earnings (12,375) (10,214) (8,370) |
Schedule of Assumptions Used in the Valuation of Option Awards | Risk-free interest rates are based on the implied yields currently available on U.S. Treasury zero coupon issues with a remaining term equal to the expected life. Year Ended December 31, Weighted Average Assumptions: 2023 2022 2021 Expected Volatility 28.1 % 30.3 % 32.9 % Expected Term (in years) 4.8 7.3 4.9 Risk-Free Interest Rate 3.9 % 2.8 % 0.5 % Dividend Yield 0.5 % 0.5 % 0.5 % |
Summary of Stock Option Activity | A summary of stock option plan activity for 2023, 2022, and 2021 for all plans is as follows: 2023 2022 2021 # of Weighted Average # of Weighted Average # of Weighted Average Outstanding at beginning of year 1,045 $ 99.82 867 $ 88.19 858 $ 80.58 Granted 109 138.09 239 139.04 129 119.12 Exercised (64) 81.98 (44) 73.58 (109) 63.42 Forfeited (11) 131.79 (17) 124.89 (10) 106.93 Cancelled (1) 138.07 — — (1) 74.57 Outstanding at end of year 1,078 $ 104.38 1,045 $ 99.82 867 $ 88.19 Exercisable at end of year 720 $ 88.49 654 $ 81.95 538 $ 75.51 |
Schedule of Other Information Pertaining to Stock Option Activity | Other information pertaining to option activity during the years ended December 31, 2023, 2022 and 2021 is as follows: Years Ended December 31, 2023 2022 2021 Weighted-average fair value of options granted $ 40.91 $ 44.77 $ 33.11 Total intrinsic value of stock options exercised ($000s) $ 3,241 $ 2,713 $ 7,866 |
Schedule of Additional Information Relating to Stock Options Outstanding | Additional information related to stock options outstanding under all plans at December 31, 2023 is as follows: Options Outstanding Options Exercisable Range of Exercise Shares Weighted Weighted Number Weighted $54.87 - $85.33 387 3.5 $ 72.41 387 $ 72.41 $85.40 - $118.60 250 4.9 101.84 248 101.71 $118.96 - $150.85 441 8.1 133.93 85 123.47 1,078 5.7 $ 104.38 720 $ 88.49 |
Schedule of Non-vested Restricted Stock Activity | Non-vested restricted stock activity for the years ended December 31, 2023, 2022 and 2021 is summarized below: 2023 2022 2021 Shares (000s) Weighted Shares (000s) Weighted Shares (000s) Weighted Non-vested balance at beginning of year 122 $ 124.42 166 $ 99.7 159 $ 90.71 Granted 40 137.20 46 137.17 42 123.58 Vested (42) 112.30 (82) 82.15 (24) 85.83 Forfeited (4) 128.06 (8) 118.07 (11) 90.49 Non-vested balance at end of year 116 $ 133.06 122 $ 124.42 166 $ 99.7 |
Schedule of Non-vested Performance Share Activity | Non-vested performance share activity for the years ended December 31, 2023, 2022 and 2021 is summarized below: 2023 2022 2021 Shares (000s) Weighted Shares (000s) Weighted Shares (000s) Weighted Non-vested balance at beginning of year 70 $ 127.69 69 $ 110.72 71 $ 91.99 Granted 42 139.66 39 114.22 36 108.74 Vested (36) 98.84 (35) 53.17 (24) 70.64 Forfeited — — (3) 84.09 (14) 81.03 Non-vested balance at end of year 76 $ 135.25 70 $ 127.69 69 $ 110.72 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories, net of reserves at December 31, 2023 and 2022 consisted of the following: 2023 2022 Raw materials $ 39,517 $ 44,477 Work in progress 3,960 3,143 Finished goods 66,044 72,048 Total inventories $ 109,521 $ 119,668 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Depreciation of plant and equipment is calculated using the straight-line method over the estimated useful lives of the assets as follows: Buildings 15-25 years Equipment 2-28 years Property, plant and equipment at December 31, 2023 and 2022 are summarized as follows: 2023 2022 Land $ 11,787 $ 11,415 Building 104,363 90,644 Equipment 312,704 278,851 Construction in progress 59,981 79,928 488,835 460,838 Less: Accumulated depreciation 212,796 189,483 Property, plant and equipment, net $ 276,039 $ 271,355 |
Schedule of Long-Lived Assets by Geographical Area | Geographic Area Data - Long-Lived Assets (excluding intangible assets): 2023 2022 United States $ 203,692 $ 211,588 Foreign Countries 72,347 59,767 Total $ 276,039 $ 271,355 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Identifiable Intangible Assets | The following intangible assets with finite lives are stated at cost and are amortized either on an accelerated basis or on a straight-line basis over the following estimated useful lives: Amortization Period Customer relationships and lists 10 - 20 Trademarks and trade names 2 - 17 Developed technology 5 - 12 Regulatory registration costs 5 - 10 Patents and trade secrets 15 - 17 Other 2 - 18 As of December 31, 2023 and 2022, the Company had identifiable intangible assets as follows: 2023 2022 Amortization Gross Accumulated Gross Accumulated Customer relationships and lists 10-20 $ 362,032 $ 209,651 $ 357,131 $ 190,576 Trademarks and trade names 2-17 50,286 37,773 50,058 33,416 Developed technology 5-12 41,184 17,516 40,473 16,171 Other 2-18 25,733 23,083 25,041 19,245 $ 479,235 $ 288,023 $ 472,703 $ 259,408 |
NET EARNINGS PER COMMON SHARE (
NET EARNINGS PER COMMON SHARE (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Reconciliation of the Net Earnings and Shares used in Calculating Basic and Diluted Net Earnings Per Share | The following presents a reconciliation of the net earnings and shares used in calculating basic and diluted net earnings per common share: Year Ended December 31, 2023 2022 2021 Net Earnings - Basic and Diluted $ 108,543 $ 105,367 $ 96,104 Share (000s) Weighted Average Common Shares - Basic 32,108 32,019 32,215 Effect of Dilutive Securities – Stock Options, Restricted Stock, and Performance Shares 340 374 457 Weighted Average Common Shares - Diluted 32,448 32,393 32,672 Net Earnings Per Share - Basic $ 3.38 $ 3.29 $ 2.98 Net Earnings Per Share - Diluted $ 3.35 $ 3.25 $ 2.94 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax Expense | Income tax expense consists of the following: 2023 2022 2021 Current: Federal $ 27,306 $ 26,423 $ 25,019 Foreign 7,634 7,103 7,553 State 4,403 3,964 3,664 Deferred: Federal (7,737) (7,532) (3,709) Foreign (2,285) (215) (3,038) State (603) (1,361) (360) Total income tax provision $ 28,718 $ 28,382 $ 29,129 |
Schedule of Income Tax Reconciliation | The provision for income taxes differs from the amount computed by applying the Federal statutory rate of 21% for 2023, 2022, and 2021 to earnings before income tax expense due to the following: 2023 2022 2021 Income tax at Federal statutory rate $ 28,825 $ 28,087 $ 26,299 State income taxes, net of Federal income taxes 2,513 1,862 2,406 Stock Options (1,004) (676) (924) Foreign-derived intangible income (FDII) (1,752) (1,778) (1,540) Foreign rate differential 946 2,066 1,188 Other (810) (1,179) 1,700 Total income tax provision $ 28,718 $ 28,382 $ 29,129 |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2023 and 2022 were as follows: 2023 2022 Deferred tax assets: Inventories $ 1,049 $ 1,038 Restricted stock and stock options 5,565 3,932 Lease liabilities 4,812 5,439 Research and development 12,653 4,134 Other 3,874 3,717 Total deferred tax assets 27,953 18,260 Deferred tax liabilities: Amortization $ (42,351) $ (46,688) Depreciation (28,937) (25,097) Prepaid expenses (421) (462) Foreign currency and interest rate swaps (647) (1,456) Right of use assets (4,574) (5,324) Other (3,047) (1,995) Total deferred tax liabilities (79,977) (81,022) Valuation allowance (22) (22) Net deferred tax liability $ (52,046) $ (62,784) |
Schedule of Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits, which is included in other long-term obligations on the Company’s consolidated balance sheets, is as follows: 2023 2022 2021 Balance at beginning of period $ 5,815 $ 5,881 $ 5,335 Increases for tax positions of prior years 1,353 2,194 806 Decreases for tax positions of prior years (2,518) (2,260) (260) Balance at end of period $ 4,650 $ 5,815 $ 5,881 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | The segment information is summarized as follows: Business Segment Assets 2023 2022 Human Nutrition and Health $ 1,180,527 $ 1,170,238 Animal Nutrition and Health 166,994 175,972 Specialty Products 168,307 177,187 Other and Unallocated (1) 81,383 101,115 Total $ 1,597,211 $ 1,624,512 Business Segment Net Sales 2023 2022 2021 Human Nutrition and Health $ 550,751 $ 527,131 $ 442,733 Animal Nutrition and Health 238,326 262,297 226,776 Specialty Products 125,965 131,438 117,020 Other and Unallocated (2) 7,397 21,492 12,494 Total $ 922,439 $ 942,358 $ 799,023 Business Segment Earnings Before Income Taxes 2023 2022 2021 Human Nutrition and Health $ 102,419 $ 82,125 $ 76,031 Animal Nutrition and Health 27,576 36,056 26,179 Specialty Products 34,579 32,789 30,020 Other and Unallocated (2) (5,381) (5,784) (4,728) Interest and other expense (21,932) (11,437) (2,269) Total $ 137,261 $ 133,749 $ 125,233 Depreciation/Amortization 2023 2022 2021 Human Nutrition and Health $ 38,568 $ 33,728 $ 30,012 Animal Nutrition and Health 7,876 6,685 7,414 Specialty Products 7,278 7,507 8,332 Other and Unallocated (2) 1,213 3,928 3,121 Total $ 54,935 $ 51,848 $ 48,879 Capital Expenditures 2023 2022 2021 Human Nutrition and Health $ 26,415 $ 33,668 $ 23,714 Animal Nutrition and Health 6,993 10,809 8,100 Specialty Products 3,535 4,004 3,804 Other and Unallocated (2) 331 605 524 Total $ 37,274 $ 49,086 $ 36,142 (1) Other and Unallocated assets consist of certain cash, capitalized loan issuance costs, other assets, investments, and income taxes, which the Company does not allocate to its individual business segments. It also includes assets associated with a few minor businesses which individually do not meet the quantitative thresholds for separate presentation. (2) Other and Unallocated consists of a few minor businesses which individually do not meet the quantitative thresholds for separate presentation and corporate expenses that have not been allocated to a segment. Unallocated corporate expenses consist of: (i) Transaction and integration costs, ERP implementation costs, and unallocated legal fees totaling $1,617, $3,581 and $1,264 for years ended December 31, 2023 , 2022 and 2021, respectively, and (ii) Unallocated amortization expense of $312, $2,951, and $2,510 for years ended December 31, 2023 , 2022 , and 2021, respectively, related to an intangible asset in connection with a company-wide ERP system implementation. |
REVENUE (Tables)
REVENUE (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue by Source and Geography | The following table presents revenues disaggregated by revenue source. Sales and usage-based taxes are excluded from revenues: 2023 2022 2021 Product Sales Revenue $ 919,951 $ 939,166 $ 794,518 Royalty Revenue 2,488 3,192 4,505 Total Revenue $ 922,439 $ 942,358 $ 799,023 The following table presents revenues disaggregated by geography, based on customers' delivery addresses: 2023 2022 2021 United States $ 689,601 $ 682,238 $ 584,661 Foreign Countries 232,838 260,120 214,362 Total $ 922,439 $ 942,358 $ 799,023 |
SUPPLEMENTAL CASH FLOW INFORM_2
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Cash Flow Information | Cash paid during the year for: 2023 2022 2021 Income taxes $ 35,725 $ 33,016 $ 25,355 Interest $ 25,933 $ 11,879 $ 4,547 Non-cash financing and investing activities: 2023 2022 2021 Dividends payable $ 25,717 $ 23,129 $ 20,886 Contingent consideration liability $ — $ 11,872 $ — |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Changes in Accumulated Other Comprehensive Income (Loss) | The changes in accumulated other comprehensive income (loss) were as follows: Years Ended December 31, 2023 2022 2021 Net foreign currency translation adjustment $ 16,809 $ (4,799) $ (11,255) Net change of cash flow hedge (see Note 20 for further information) Unrealized (loss) gain on cash flow hedge (1,406) 3,564 2,707 Tax 341 (868) (654) Net of tax (1,065) 2,696 2,053 Net change in postretirement benefit plan (see Note 15 for further information) Prior service loss (gain) arising during the period 132 (41) (4) Amortization of prior service gain — 9 74 Amortization of loss (gain) 8 (2) (21) Total before tax 140 (34) 49 Tax (39) (24) (13) Net of tax 101 (58) 36 Total other comprehensive income/(loss) $ 15,845 $ (2,161) $ (9,166) |
Components of Accumulated Other Comprehensive (Loss)/Income | Accumulated other comprehensive loss at December 31, 2023 and 2022 consisted of the following: Foreign currency Cash flow hedge Postretirement benefit plan Total Balance December 31, 2022 $ (8,401) $ 1,065 $ 182 $ (7,154) Other comprehensive income (loss) 16,809 (1,065) 101 15,845 Balance December 31, 2023 $ 8,408 $ — $ 283 $ 8,691 |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
Schedule of Changes in Benefit Obligation | The actuarial recorded liabilities for such unfunded postretirement benefits are as follows: Change in benefit obligation: 2023 2022 Benefit obligation at beginning of year $ 1,465 $ 1,293 Service cost with interest to end of year 108 79 Interest cost 62 26 Participant contributions 23 27 Benefits paid (30) (69) Actuarial (gain) loss (233) 109 Benefit obligation at end of year $ 1,395 $ 1,465 Change in benefit obligation: 2023 2022 Benefit obligation at beginning of year $ 1,589 $ 1,859 Service cost with interest to end of year 65 44 Interest cost 65 17 Participant contributions — 27 Benefits paid (188) (60) Actuarial loss (gain) 80 (194) Exchange rate changes 49 (104) Benefit obligation at end of year $ 1,660 $ 1,589 |
Schedule of Changes in Plan Assets | Change in plan assets: 2023 2022 Fair value of plan assets at beginning of year $ — $ — Employer contributions 7 42 Participant contributions 23 27 Benefits paid (30) (69) Fair value of plan assets at end of year $ — $ — Change in plan assets: 2023 2022 Fair value of plan assets at beginning of year $ 1,196 $ 1,175 Actual return on plan assets 56 26 Employer contributions 138 94 Participant contributions — 27 Benefits paid (188) (60) Exchange rate changes 38 (66) Fair value of plan assets at end of year $ 1,240 $ 1,196 |
Schedule of Amounts Recognized in Consolidated Balance Sheet | Amounts recognized in consolidated balance sheet: 2023 2022 Accumulated postretirement benefit obligation $ (1,395) $ (1,465) Fair value of plan assets — — Funded status (1,395) (1,465) Unrecognized prior service cost 9 74 Unrecognized net loss (gain) (2) (24) Net amount recognized in consolidated balance sheet (after ASC 715) (included in "Other long-term obligations") $ (1,395) $ (1,465) Accrued postretirement benefit cost (included in "Other long-term obligations") N/A N/A Amounts recognized in consolidated balance sheet: 2023 2022 Benefit obligation $ (1,660) $ (1,589) Fair value of plan assets 1,240 1,196 Funded status (420) (393) Unrecognized prior service cost N/A N/A Unrecognized net (gain)/loss N/A N/A Net amount recognized in consolidated balance sheet (after ASC 715) (included in other long-term obligations) $ (420) $ (393) Accrued postretirement benefit cost (included in other long-term obligations) N/A N/A |
Schedule of Components of Net Periodic Benefit Cost | Components of net periodic benefit cost: 2023 2022 2021 Service cost with interest to end of year $ 108 $ 79 $ 87 Interest cost 62 26 23 Amortization of prior service cost — 9 74 Amortization of loss (gain) 8 (2) (24) Total net periodic benefit cost $ 178 $ 112 $ 160 Components of net periodic benefit cost: 2023 2022 2021 Service cost with interest to end of year $ 65 $ 44 $ 67 Interest cost 65 17 14 Expected return on plan assets (42) (37) (34) Amortization of net loss — — 3 Total net periodic benefit cost $ 88 $ 24 $ 50 |
Schedule of Estimated Future Employer Contributions and Benefit Payments | Estimated future employer contributions and benefit payments are as follows: Year 2024 $ 131 2025 132 2026 99 2027 101 2028 85 Years 2029-2033 615 Estimated future benefit payments are as follows: Year 2024 $ 1 2025 52 2026 1 2027 1 2028 1 Years 2029-2033 1,096 |
Schedule of Assumptions to Determine Benefit Obligation | Assumptions to determine benefit obligations: 2023 2022 Discount rate 4.15 % 4.40 % Assumptions to determine net cost: 2023 2022 2021 Discount rate 4.40 % 2.10 % 1.75 % Assumptions to determine benefit obligations: 2023 2022 Discount rate 3.45 % 4.00 % Assumptions to determine net cost: 2023 2022 2021 Discount rate 4.00 % 1.00 % 0.75 % Expected return on assets 3.25 % 3.25 % 3.25 % |
Summary of Pension Fund | The Company’s participation in this plan for the annual period ended December 31, 2023 is outlined in the table below. The “EIN/Pension Plan Number” column provides the Employee Identification Number (EIN). The zone status is based on information that the Company received from the plan and is certified by the plan’s actuary. Among other factors, plans in the red zone or critical and declining zone are generally less than 65 percent funded, plans in the yellow zone are less than 80 percent funded, and plans in the green zone are at least 80 percent funded. The “FIP/RP Status Pending/Implemented” column indicates plans for which a financial improvement plan (FIP) or a rehabilitation plan (RP) is either pending or has been implemented. The last column lists the expiration date of the collective-bargaining agreement to which the plan is subject. Finally, the period-to-period comparability of the contributions for 2023 and 2022 was affected by a 4.0% increase in the 2023 contribution rate. There have been no other significant changes that affect the comparability of 2023 and 2022 contributions. The Company does not represent more than 5% of the contributions to this pension fund. Pension EIN/Pension Pension Plan Protection Act Zone Status FIP/RP Status Contributions of Balchem Corporation Surcharge Expiration Date of Collective- 2023 2022 2023 2022 2021 Central States, 36-6044243 Critical & Declining as of 1/1/23 Critical & Declining as of 1/1/22 Implemented $1,020 $939 $816 No 7/12/2025 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Schedule of Lease Cost | Right of use assets and lease liabilities at December 31, 2023 and 2022 are summarized as follows: Right of use assets 2023 2022 Operating leases $ 17,763 $ 17,094 Finance lease 2,101 2,338 Total $ 19,864 $ 19,432 Lease liabilities - current 2023 2022 Operating leases $ 3,949 $ 3,796 Finance lease 272 226 Total $ 4,221 $ 4,022 Lease liabilities - non-current 2023 2022 Operating leases $ 14,601 $ 13,806 Finance lease 1,943 2,213 Total $ 16,544 $ 16,019 For the years ended December 31, 2023, 2022, and 2021, the Company's total lease costs were as follows, which included both amounts recognized in profits or losses during the period and amounts capitalized on the balance sheet, and the cash flows arising from lease transactions: Year ended December 31, 2023 2022 2021 Lease Cost Operating lease cost $ 5,307 $ 4,478 $ 3,143 Finance Lease cost Amortization of ROU asset 242 210 210 Interest on lease liabilities 115 125 129 Total finance lease 357 335 339 Total lease cost $ 5,664 $ 4,813 $ 3,482 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 4,757 $ 4,269 $ 3,097 Operating cash flows from finance leases 115 125 129 Financing cash flows from finance leases 222 177 159 $ 5,094 $ 4,571 $ 3,385 ROU assets obtained in exchange for new operating lease liabilities, net of ROU asset disposals $ 6,365 $ 11,488 $ 3,804 Weighted-average remaining lease term - operating leases 9.33 years 5.63 years 4.21 years Weighted-average remaining lease term - finance leases 9.07 years 9.95 years 11.41 years Weighted-average discount rate - operating leases 7.4 % 2.7 % 3.5 % Weighted-average discount rate - finance leases 5.0 % 5.0 % 5.1 % |
Schedule of Aggregate Future Minimum Rental Payments Required under Non-Cancelable Operating Leases | Aggregate future minimum rental payments required under non-cancelable operating and finance leases at December 31, 2023 are as follows: Year 2024 $ 5,407 2025 4,219 2026 3,638 2027 2,736 2028 2,219 Thereafter 7,717 Total minimum lease payments $ 25,936 |
Schedule of Aggregate Future Minimum Rental Payments Required under Non-Cancelable Finance Leases | Aggregate future minimum rental payments required under non-cancelable operating and finance leases at December 31, 2023 are as follows: Year 2024 $ 5,407 2025 4,219 2026 3,638 2027 2,736 2028 2,219 Thereafter 7,717 Total minimum lease payments $ 25,936 |
DERIVATIVE INSTRUMENTS AND HE_2
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Fair Value of Derivative Instruments | As of December 31, 2022, the fair value of the derivative instruments is presented as follows in the Company's consolidated balance sheets: Derivative assets December 31, 2022 Interest rate swap $ 1,406 Cross-currency swap 4,587 Derivative assets $ 5,993 |
Schedule of Income (Loss) on Hedging Instruments | Gains and losses on our hedging instruments were recognized in accumulated other comprehensive income (loss) and categorized as follows for the years ended December 31, 2023, 2022, and 2021: Location within Statements of Comprehensive Income Year ended December 31, 2023 2022 2021 Cash flow hedge (interest rate swap), net of tax Unrealized (loss) gain on cash flow hedge, net $ (1,065) $ 2,696 $ 2,053 Net investment hedge (cross-currency swap), net of tax Net foreign currency translation adjustment (1,455) 3,851 4,766 $ (2,520) $ 6,547 $ 6,819 |
QUARTERLY FINANCIAL INFORMATI_2
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | (In thousands, except per share data) 2023 2022 First Second Third Fourth First Second Third Fourth Net sales $ 232,540 $ 231,252 $ 229,948 $ 228,699 $ 228,867 $ 236,693 $ 244,267 $ 232,531 Gross margin 73,170 77,349 76,544 74,993 71,506 71,876 68,430 68,639 Earnings before income taxes 29,119 38,400 36,475 33,267 37,630 39,258 31,085 25,776 Net earnings 22,710 30,110 29,075 26,648 28,930 29,782 25,249 21,406 Basic net earnings per common share $ 0.71 $ 0.94 $ 0.91 $ 0.83 $ 0.90 $ 0.93 $ 0.79 $ 0.67 Diluted net earnings per common share $ 0.70 $ 0.93 $ 0.90 $ 0.82 $ 0.89 $ 0.92 $ 0.78 $ 0.66 |
BUSINESS DESCRIPTION AND SUMM_4
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property, Plant and Equipment Useful Lives (Details) | Dec. 31, 2023 |
Minimum | Buildings | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 15 years |
Minimum | Equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 2 years |
Maximum | Buildings | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 25 years |
Maximum | Equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 28 years |
BUSINESS DESCRIPTION AND SUMM_5
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Aug. 30, 2022 | Jun. 21, 2022 | |
Goodwill [Line Items] | ||||
Goodwill | $ 778,907 | $ 769,509 | ||
Goodwill [Roll Forward] | ||||
Goodwill, beginning of period | 769,509 | 523,949 | ||
Impact due to change in foreign exchange rates | 9,057 | (1,944) | ||
Goodwill, end of period | 778,907 | 769,509 | ||
HNH | ||||
Goodwill [Line Items] | ||||
Goodwill | 673,207 | 665,804 | ||
Goodwill [Roll Forward] | ||||
Goodwill, beginning of period | 665,804 | |||
Goodwill, end of period | 673,207 | 665,804 | ||
ANH | ||||
Goodwill [Line Items] | ||||
Goodwill | 24,469 | 24,218 | ||
Goodwill [Roll Forward] | ||||
Goodwill, beginning of period | 24,218 | |||
Goodwill, end of period | 24,469 | 24,218 | ||
Specialty Products | ||||
Goodwill [Line Items] | ||||
Goodwill | 81,175 | 79,429 | ||
Goodwill [Roll Forward] | ||||
Goodwill, beginning of period | 79,429 | |||
Goodwill, end of period | 81,175 | 79,429 | ||
Other and Unallocated | ||||
Goodwill [Line Items] | ||||
Goodwill | 56 | 58 | ||
Goodwill [Roll Forward] | ||||
Goodwill, beginning of period | 58 | |||
Goodwill, end of period | 56 | 58 | ||
Kappa | ||||
Goodwill [Line Items] | ||||
Goodwill | $ 216,383 | |||
Goodwill [Roll Forward] | ||||
Goodwill, acquired during period | 216,295 | |||
Bergstrom | ||||
Goodwill [Line Items] | ||||
Goodwill | $ 31,550 | |||
Goodwill [Roll Forward] | ||||
Goodwill, acquired during period | $ 341 | $ 31,209 |
BUSINESS DESCRIPTION AND SUMM_6
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Intangible Assets Useful Lives (Details) | Dec. 31, 2023 |
Minimum | Customer relationships and lists | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 10 years |
Minimum | Trademarks and trade names | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 2 years |
Minimum | Developed technology | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 5 years |
Minimum | Regulatory registration costs | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 5 years |
Minimum | Patents and trade secrets | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 15 years |
Minimum | Other | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 2 years |
Maximum | Customer relationships and lists | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 20 years |
Maximum | Trademarks and trade names | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 17 years |
Maximum | Developed technology | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 12 years |
Maximum | Regulatory registration costs | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 10 years |
Maximum | Patents and trade secrets | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 17 years |
Maximum | Other | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life of intangible assets | 18 years |
SIGNIFICANT ACQUISITIONS - Narr
SIGNIFICANT ACQUISITIONS - Narrative (Details) kr in Thousands | 3 Months Ended | 12 Months Ended | ||||||
Aug. 30, 2022 USD ($) | Jun. 21, 2022 USD ($) | Jun. 21, 2022 NOK (kr) | Dec. 31, 2023 USD ($) | Sep. 30, 2023 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Business Acquisition [Line Items] | ||||||||
Cash paid for acquisitions, net of cash acquired | $ 1,252,000 | $ 365,780,000 | $ 0 | |||||
Contingent consideration liability | $ 0 | 0 | 11,872,000 | 0 | ||||
Goodwill | 778,907,000 | 778,907,000 | 769,509,000 | 523,949,000 | ||||
HNH | ||||||||
Business Acquisition [Line Items] | ||||||||
Goodwill | 673,207,000 | 673,207,000 | 665,804,000 | |||||
Goodwill percent | 80% | |||||||
ANH | ||||||||
Business Acquisition [Line Items] | ||||||||
Goodwill | 24,469,000 | 24,469,000 | 24,218,000 | |||||
Goodwill percent | 20% | |||||||
Bergstrom | ||||||||
Business Acquisition [Line Items] | ||||||||
Payment | $ 72,143,000 | 70,892,000 | ||||||
Total expected consideration | 72,243,000 | |||||||
Cash acquired from acquisition | 773,000 | |||||||
Cash paid for acquisitions, net of cash acquired | 71,164,000 | |||||||
Contingent consideration liability | 100,000 | 100,000 | ||||||
Business Combination, Post-Closing Payment | $ 910,000 | |||||||
Total expected payments | 72,243,000 | |||||||
Working capital adjustment | 341,000 | |||||||
Goodwill | 31,550,000 | |||||||
Transaction and integration costs (credits) | (10,614,000) | 4,604,000 | 0 | |||||
Acquisition of transaction costs | 11,300,000 | 3,565,000 | ||||||
Bergstrom | Former Shareholders | ||||||||
Business Acquisition [Line Items] | ||||||||
Payment | 71,937,000 | |||||||
Total expected consideration | $ 72,037,000 | |||||||
Bergstrom | Customer relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Useful life of intangible assets acquired | 15 years | |||||||
Bergstrom | Corporate Trademark | ||||||||
Business Acquisition [Line Items] | ||||||||
Useful life of intangible assets acquired | 2 years | |||||||
Bergstrom | Product Trademarks | ||||||||
Business Acquisition [Line Items] | ||||||||
Useful life of intangible assets acquired | 10 years | |||||||
Bergstrom | Developed technology | ||||||||
Business Acquisition [Line Items] | ||||||||
Useful life of intangible assets acquired | 12 years | |||||||
Kappa | ||||||||
Business Acquisition [Line Items] | ||||||||
Payment | kr | kr 3,305,653 | |||||||
Total expected consideration | $ 333,112,000 | |||||||
Cash acquired from acquisition | 6,365,000 | 63,064 | ||||||
Cash paid for acquisitions, net of cash acquired | kr | 2,938,917 | |||||||
Contingent consideration liability | 0 | |||||||
Goodwill | 216,383,000 | |||||||
Transaction and integration costs (credits) | $ 533,000 | $ (2,306,000) | $ 0 | |||||
Acquisition of transaction costs | $ 4,037,000 | |||||||
Net gain on foreign currency exchange forward contracts | 512,000 | |||||||
Kappa bank debt paid on acquisition date | 333,112,000 | |||||||
Kappa | Former Shareholders | ||||||||
Business Acquisition [Line Items] | ||||||||
Payment | kr | 3,001,981 | |||||||
Total expected consideration | 302,464,000 | |||||||
Cash paid for acquisitions, net of cash acquired | 296,099,000 | |||||||
Kappa bank debt paid on acquisition date | 302,464,000 | |||||||
Kappa | Former Shareholders' Lenders And Creditors | ||||||||
Business Acquisition [Line Items] | ||||||||
Payment | kr | kr 303,672 | |||||||
Total expected consideration | $ 30,648,000 | |||||||
Kappa | Customer relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Useful life of intangible assets acquired | 15 years | 15 years | ||||||
Kappa | Corporate Trademark | ||||||||
Business Acquisition [Line Items] | ||||||||
Useful life of intangible assets acquired | 2 years | 2 years | ||||||
Kappa | Product Trademarks | ||||||||
Business Acquisition [Line Items] | ||||||||
Useful life of intangible assets acquired | 10 years | 10 years | ||||||
Kappa | Developed technology | ||||||||
Business Acquisition [Line Items] | ||||||||
Useful life of intangible assets acquired | 12 years | 12 years |
SIGNIFICANT ACQUISITIONS - Fair
SIGNIFICANT ACQUISITIONS - Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Aug. 30, 2022 | Jun. 21, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Goodwill | $ 778,907 | $ 769,509 | $ 523,949 | ||
Net decrease to contingent consideration liability and other post-closing payments | $ (11,300) | $ 0 | $ 0 | ||
Bergstrom | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Cash and cash equivalents | $ 773 | ||||
Accounts receivable | 4,699 | ||||
Inventories | 3,972 | ||||
Property, plant and equipment | 2,243 | ||||
Right of use assets | 866 | ||||
Other assets | 197 | ||||
Accounts payable | (699) | ||||
Bank debt | (206) | ||||
Lease liabilities | (871) | ||||
Other liabilities | (462) | ||||
Goodwill | 31,550 | ||||
Total consideration on acquisition date and working capital adjustment | 78,862 | ||||
Net decrease to contingent consideration liability and other post-closing payments | (6,825) | ||||
Total expected consideration | 72,243 | ||||
Bergstrom | Former Shareholders | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Total expected consideration | 72,037 | ||||
Bergstrom | Former Bank | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Total expected consideration | 206 | ||||
Bergstrom | Customer relationships | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Intangible assets | 29,900 | ||||
Bergstrom | Developed technology | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Intangible assets | 4,600 | ||||
Bergstrom | Trademarks | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Intangible assets | $ 2,300 | ||||
Kappa | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Cash and cash equivalents | $ 6,365 | ||||
Accounts receivable | 8,036 | ||||
Inventories | 17,600 | ||||
Property, plant and equipment | 9,854 | ||||
Right of use assets | 3,349 | ||||
Other assets | 2,399 | ||||
Accounts payable | (3,301) | ||||
Bank debt | (30,648) | ||||
Lease liabilities | (3,349) | ||||
Other liabilities | (4,461) | ||||
Deferred income taxes, net | (24,716) | ||||
Goodwill | 216,383 | ||||
Total consideration on acquisition date and working capital adjustment | 307,013 | ||||
Net decrease to contingent consideration liability and other post-closing payments | (4,037) | ||||
Net gain on foreign currency exchange forward contracts | (512) | ||||
Total expected consideration | 333,112 | ||||
Kappa | Former Shareholders | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Total expected consideration | 302,464 | ||||
Kappa | Former Shareholders' Lenders And Creditors | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Total expected consideration | 30,648 | ||||
Kappa | Customer relationships | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Intangible assets | 88,813 | ||||
Kappa | Developed technology | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Intangible assets | 15,643 | ||||
Kappa | Trademarks | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Intangible assets | $ 5,046 |
SIGNIFICANT ACQUISITIONS - Sche
SIGNIFICANT ACQUISITIONS - Schedule of Pro Forma Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Net Sales [Abstract] | |||
Kappa & Bergstrom actual results included in the Company's consolidated income statement | $ 59,532 | $ 22,158 | |
Pro forma combined net sales | 922,439 | 982,021 | $ 859,252 |
Net Earnings [Abstract] | |||
Kappa & Bergstrom actual results included in the Company's consolidated income statement in 2023 | 5,487 | (5,359) | |
Supplemental pro forma combined financial information | $ 116,317 | $ 110,181 | $ 90,672 |
STOCKHOLDERS' EQUITY - Schedule
STOCKHOLDERS' EQUITY - Schedule of Compensation Cost on Net Earnings (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Net earnings | $ (12,375) | $ (10,214) | $ (8,370) |
Cost of sales | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation cost | 1,900 | 1,302 | 845 |
Operating expenses | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation cost | $ 14,152 | $ 11,922 | $ 9,957 |
STOCKHOLDERS' EQUITY - Stock-ba
STOCKHOLDERS' EQUITY - Stock-based Compensation (Details) | 12 Months Ended | |
Jun. 22, 2023 shares | Dec. 31, 2023 plan shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of share-based compensation plans | plan | 1 | |
2017 Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares authorized for grants (in shares) | 2,400,000 | |
Increase in amount approved (in shares) | 800,000 | |
Expiration period of options granted | 10 years | |
2017 Plan | Non-employee director | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares purchased under restricted stock purchase agreements, minimum (in shares) | 70 | |
Shares purchased under restricted stock purchase agreements, maximum (in shares) | 54,000 | |
2017 Plan | Stock Options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares available for future awards (in shares) | 1,034,260 |
STOCKHOLDERS' EQUITY - Assumpti
STOCKHOLDERS' EQUITY - Assumptions Used in Fair Value Determination (Details) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Stock Options | |||
Weighted Average Assumptions [Abstract] | |||
Expected Volatility | 28.10% | 30.30% | 32.90% |
Expected Term (in years) | 4 years 9 months 18 days | 7 years 3 months 18 days | 4 years 10 months 24 days |
Risk-Free Interest Rate | 3.90% | 2.80% | 0.50% |
Dividend Yield | 0.50% | 0.50% | 0.50% |
Stock Options | Minimum | |||
Weighted Average Assumptions [Abstract] | |||
Vesting period | 3 years | ||
Stock Options | Maximum | |||
Weighted Average Assumptions [Abstract] | |||
Vesting period | 5 years | ||
Performance Shares | Employee | |||
Weighted Average Assumptions [Abstract] | |||
Expected Volatility | 32% | 32% | 33% |
Risk-Free Interest Rate | 4.20% | 1.80% | 0.20% |
Dividend Yield | 0.50% | 0.50% | 0.60% |
Initial total shareholder return percentage | 4.20% | (15.70%) | 11.70% |
Cliff vesting percentage | 100% | ||
Vesting period | 3 years | ||
Restricted Stock | Employee | |||
Weighted Average Assumptions [Abstract] | |||
Vesting period | 3 years | ||
Restricted Stock | Non-employee director | |||
Weighted Average Assumptions [Abstract] | |||
Vesting period | 3 years |
STOCKHOLDERS' EQUITY - Stock Op
STOCKHOLDERS' EQUITY - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||
Outstanding at beginning of year (in shares) | 1,045 | 867 | 858 |
Granted (in shares) | 109 | 239 | 129 |
Exercised (in shares) | (64) | (44) | (109) |
Forfeited (in shares) | (11) | (17) | (10) |
Cancelled (in shares) | (1) | 0 | (1) |
Outstanding at end of year (in shares) | 1,078 | 1,045 | 867 |
Exercisable at end of year (in shares) | 720 | 654 | 538 |
Weighted Average Exercise Price [Abstract] | |||
Outstanding at beginning of year (in dollars per share) | $ 99.82 | $ 88.19 | $ 80.58 |
Granted (in dollars per share) | 138.09 | 139.04 | 119.12 |
Exercised (in dollars per share) | 81.98 | 73.58 | 63.42 |
Forfeited (in dollars per share) | 131.79 | 124.89 | 106.93 |
Cancelled (in dollars per share) | 138.07 | 0 | 74.57 |
Outstanding at end of year (in dollars per share) | 104.38 | 99.82 | 88.19 |
Exercisable at end of period (in dollars per share) | $ 88.49 | $ 81.95 | $ 75.51 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |||
Aggregate intrinsic value for outstanding stock options | $ 47,889 | $ 27,221 | $ 69,711 |
Weighted average remaining contractual term for outstanding stock options | 5 years 8 months 12 days | ||
Aggregate intrinsic value for exercisable stock options outstanding | $ 43,364 | ||
Weighted average remaining contractual term for exercisable stock options outstanding | 4 years 4 months 24 days | ||
Weighted-average fair value of options granted (in dollars per share) | $ 40.91 | $ 44.77 | $ 33.11 |
Total intrinsic value of stock options exercised | $ 3,241 | $ 2,713 | $ 7,866 |
STOCKHOLDERS' EQUITY - Informat
STOCKHOLDERS' EQUITY - Information Related to Stock Options Outstanding (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Shares Outstanding (in shares) | shares | 1,078 |
Weighted Average Remaining Contractual Term | 5 years 8 months 12 days |
Weighted Average Exercise Price of Options Outstanding (in dollars per share) | $ 104.38 |
Number of Options Exercisable (in shares) | shares | 720 |
Weighted Average Exercise Price of Options Exercisable (in dollars per share) | $ 88.49 |
$54.87 - $85.33 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of exercise prices, minimum (in dollars per share) | 54.87 |
Range of exercise prices, maximum (in dollars per share) | $ 85.33 |
Shares Outstanding (in shares) | shares | 387 |
Weighted Average Remaining Contractual Term | 3 years 6 months |
Weighted Average Exercise Price of Options Outstanding (in dollars per share) | $ 72.41 |
Number of Options Exercisable (in shares) | shares | 387 |
Weighted Average Exercise Price of Options Exercisable (in dollars per share) | $ 72.41 |
$85.40 - $118.60 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of exercise prices, minimum (in dollars per share) | 85.40 |
Range of exercise prices, maximum (in dollars per share) | $ 118.60 |
Shares Outstanding (in shares) | shares | 250 |
Weighted Average Remaining Contractual Term | 4 years 10 months 24 days |
Weighted Average Exercise Price of Options Outstanding (in dollars per share) | $ 101.84 |
Number of Options Exercisable (in shares) | shares | 248 |
Weighted Average Exercise Price of Options Exercisable (in dollars per share) | $ 101.71 |
$118.96 - $150.85 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of exercise prices, minimum (in dollars per share) | 118.96 |
Range of exercise prices, maximum (in dollars per share) | $ 150.85 |
Shares Outstanding (in shares) | shares | 441 |
Weighted Average Remaining Contractual Term | 8 years 1 month 6 days |
Weighted Average Exercise Price of Options Outstanding (in dollars per share) | $ 133.93 |
Number of Options Exercisable (in shares) | shares | 85 |
Weighted Average Exercise Price of Options Exercisable (in dollars per share) | $ 123.47 |
STOCKHOLDERS' EQUITY - Restrict
STOCKHOLDERS' EQUITY - Restricted Stock and Performance Share Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Unrecognized compensation cost related to non-vested shares | $ 18,817 | $ 20,791 | $ 13,980 |
Weighted-average period of recognition for unrecognized compensation cost | 1 year 7 months 6 days | ||
Estimated share-based compensation expense for current fiscal year | $ 14,800 | ||
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Non-vested balance as of beginning of year (in shares) | 122 | 166 | 159 |
Granted (in shares) | 40 | 46 | 42 |
Vested (in shares) | (42) | (82) | (24) |
Forfeited (in shares) | (4) | (8) | (11) |
Non-vested balance as of end of year (in shares) | 116 | 122 | 166 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Non-vested balance as of beginning of year (in dollars per share) | $ 124.42 | $ 99.7 | $ 90.71 |
Granted (in dollars per share) | 137.20 | 137.17 | 123.58 |
Vested (in dollars per share) | 112.30 | 82.15 | 85.83 |
Forfeited (in dollars per share) | 128.06 | 118.07 | 90.49 |
Non-vested balance as of end of year (in dollars per share) | $ 133.06 | $ 124.42 | $ 99.7 |
Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Non-vested balance as of beginning of year (in shares) | 70 | 69 | 71 |
Granted (in shares) | 42 | 39 | 36 |
Vested (in shares) | (36) | (35) | (24) |
Forfeited (in shares) | 0 | (3) | (14) |
Non-vested balance as of end of year (in shares) | 76 | 70 | 69 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Non-vested balance as of beginning of year (in dollars per share) | $ 127.69 | $ 110.72 | $ 91.99 |
Granted (in dollars per share) | 139.66 | 114.22 | 108.74 |
Vested (in dollars per share) | 98.84 | 53.17 | 70.64 |
Forfeited (in dollars per share) | 0 | 84.09 | 81.03 |
Non-vested balance as of end of year (in dollars per share) | $ 135.25 | $ 127.69 | $ 110.72 |
STOCKHOLDERS' EQUITY - Repurcha
STOCKHOLDERS' EQUITY - Repurchase of Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Stockholders' Equity Note [Abstract] | ||||
Number of shares authorized to be repurchased (in shares) | 3,763,038 | |||
Aggregate number of shares repurchased since inception (in shares) | 3,103,106 | |||
Repurchases of common stock | $ 4,514 | [1] | $ 35,423 | $ 35,239 |
Number of shares acquired under the stock repurchase plan and subsequently reissued (in shares) | 32,558 | 252,304 | 249,848 | |
Shares repurchased, average cost (in dollars per share) | $ 137.29 | $ 140.40 | $ 141.04 | |
[1] * On August 16, 2022, the U.S. government enacted the Inflation Reduction Act (the "IRA") into law. The IRA imposes a 1% excise tax on share repurchases, which is effective for repurchases completed after December 31, 2022. The excise tax is recorded within equity as part of the repurchase of the common stock. |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 39,517 | $ 44,477 |
Work in progress | 3,960 | 3,143 |
Finished goods | 66,044 | 72,048 |
Total inventories | 109,521 | 119,668 |
Reserve for inventory | $ 2,463 | $ 2,640 |
PROPERTY, PLANT AND EQUIPMENT -
PROPERTY, PLANT AND EQUIPMENT - Schedule of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 488,835 | $ 460,838 |
Less: Accumulated depreciation | 212,796 | 189,483 |
Property, plant and equipment, net | 276,039 | 271,355 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 11,787 | 11,415 |
Building | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 104,363 | 90,644 |
Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 312,704 | 278,851 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 59,981 | $ 79,928 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT - Long-Lived Assets by Geographical Area (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets, excluding intangible assets | $ 276,039 | $ 271,355 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets, excluding intangible assets | 203,692 | 211,588 |
Foreign Countries | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets, excluding intangible assets | $ 72,347 | $ 59,767 |
PROPERTY, PLANT AND EQUIPMENT_3
PROPERTY, PLANT AND EQUIPMENT - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 26,373 | $ 24,033 | $ 23,295 |
Restructuring-related impairment and asset disposal charges | $ 7,764 | $ 0 |
INTANGIBLE ASSETS - Narrative (
INTANGIBLE ASSETS - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 778,907,000 | $ 769,509,000 | $ 523,949,000 |
Amortization of identifiable intangible assets | 28,035,000 | 27,271,000 | $ 25,092,000 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |||
2024 | 18,971,000 | ||
2025 | 15,509,000 | ||
2026 | 15,308,000 | ||
2027 | 14,784,000 | ||
2028 | 14,387,000 | ||
Identifiable intangible assets | $ 0 | $ 0 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Identifiable intangible assets [Abstract] | ||
Gross Carrying Amount | $ 479,235 | $ 472,703 |
Accumulated Amortization | 288,023 | 259,408 |
Customer relationships and lists | ||
Identifiable intangible assets [Abstract] | ||
Gross Carrying Amount | 362,032 | 357,131 |
Accumulated Amortization | $ 209,651 | 190,576 |
Customer relationships and lists | Minimum | ||
Identifiable intangible assets [Abstract] | ||
Amortization Period (In years) | 10 years | |
Customer relationships and lists | Maximum | ||
Identifiable intangible assets [Abstract] | ||
Amortization Period (In years) | 20 years | |
Trademarks and trade names | ||
Identifiable intangible assets [Abstract] | ||
Gross Carrying Amount | $ 50,286 | 50,058 |
Accumulated Amortization | $ 37,773 | 33,416 |
Trademarks and trade names | Minimum | ||
Identifiable intangible assets [Abstract] | ||
Amortization Period (In years) | 2 years | |
Trademarks and trade names | Maximum | ||
Identifiable intangible assets [Abstract] | ||
Amortization Period (In years) | 17 years | |
Developed technology | ||
Identifiable intangible assets [Abstract] | ||
Gross Carrying Amount | $ 41,184 | 40,473 |
Accumulated Amortization | $ 17,516 | 16,171 |
Developed technology | Minimum | ||
Identifiable intangible assets [Abstract] | ||
Amortization Period (In years) | 5 years | |
Developed technology | Maximum | ||
Identifiable intangible assets [Abstract] | ||
Amortization Period (In years) | 12 years | |
Other | ||
Identifiable intangible assets [Abstract] | ||
Gross Carrying Amount | $ 25,733 | 25,041 |
Accumulated Amortization | $ 23,083 | $ 19,245 |
Other | Minimum | ||
Identifiable intangible assets [Abstract] | ||
Amortization Period (In years) | 2 years | |
Other | Maximum | ||
Identifiable intangible assets [Abstract] | ||
Amortization Period (In years) | 18 years |
EQUITY-METHOD INVESTMENT (Detai
EQUITY-METHOD INVESTMENT (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 USD ($) vote | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2013 | |
Schedule of Equity Method Investments [Line Items] | ||||
Number of votes | vote | 2 | |||
Percentage of operating expenses to be absorbed | 66.66% | |||
Percentage of production offtake | 66.66% | |||
St. Gabriel CC Company, LLC | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Ownership percentage in joint venture | 66.66% | |||
Loss relating to joint venture's expenses | $ 509 | $ 559 | $ 557 | |
Capital contributions | 290 | 355 | $ 85 | |
Carrying value of joint venture | $ 4,076 | $ 4,295 | ||
St. Gabriel CC Company, LLC | Eastman Chemical Company | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Ownership percentage in joint venture | 33.34% |
REVOLVING LOAN (Details)
REVOLVING LOAN (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||
Jul. 27, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 27, 2018 | |
Debt Instrument [Line Items] | |||||||
Proceeds from revolving loan | $ 18,000,000 | $ 435,000,000 | $ 5,000,000 | ||||
Repayments of outstanding balance | 149,000,000 | 103,000,000 | 60,000,000 | ||||
Capitalized costs net of accumulated amortization | 1,030,000 | 1,317,000 | |||||
Amortization expense pertaining to capitalized costs | $ 287,000 | 335,000 | $ 282,000 | ||||
Credit Agreement | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate | 6.58% | ||||||
Commitment fee percentage | 0.175% | ||||||
Unused portion of revolving loan | $ 240,431,000 | ||||||
Credit Agreement | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Commitment fee percentage | 0.15% | ||||||
Credit Agreement | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Commitment fee percentage | 0.225% | ||||||
Revolving loan | 2018 Credit Agreement | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 550,000,000 | $ 500,000,000 | |||||
Proceeds from revolving loan | $ 70,000,000 | $ 345,000,000 | |||||
Repayments of outstanding balance | $ 433,569,000 | ||||||
Installment payments required | $ 0 | ||||||
Outstanding balance | $ 309,569,000 | $ 440,569,000 |
NET EARNINGS PER COMMON SHARE_2
NET EARNINGS PER COMMON SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |||||||||||
Net Earnings - Basic and Diluted | $ 26,648 | $ 29,075 | $ 30,110 | $ 22,710 | $ 21,406 | $ 25,249 | $ 29,782 | $ 28,930 | $ 108,543 | $ 105,367 | $ 96,104 |
Weighted average common shares - basic (in shares) | 32,108,000 | 32,019,000 | 32,215,000 | ||||||||
Effect of dilutive securities - stock options, restricted stock, and performance shares (in shares) | 340,000 | 374,000 | 457,000 | ||||||||
Weighted average common shares - diluted (in shares) | 32,448,000 | 32,393,000 | 32,672,000 | ||||||||
Basic net earnings per common share (in dollars per share) | $ 0.83 | $ 0.91 | $ 0.94 | $ 0.71 | $ 0.67 | $ 0.79 | $ 0.93 | $ 0.90 | $ 3.38 | $ 3.29 | $ 2.98 |
Net earnings per share - diluted (in dollars per share) | $ 0.82 | $ 0.90 | $ 0.93 | $ 0.70 | $ 0.66 | $ 0.78 | $ 0.92 | $ 0.89 | $ 3.35 | $ 3.25 | $ 2.94 |
Anti-dilutive stock options outstanding, excluded from diluted earnings per share calculation (in shares) | 354,619 | 371,513 | 155,294 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Loss Carryforwards [Line Items] | |||
Effective tax rate | 20.90% | 21.20% | 23.30% |
Belgium earnings remitted | $ 18,000 | ||
Incurred an income tax expense | 20 | ||
Unremitted foreign earnings | 109,000 | $ 94,000 | |
Valuation allowance | 22 | 22 | |
Interest and penalties | (322) | (371) | $ 262 |
Accrued interest and penalties | 1,413 | $ 1,735 | |
State | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | $ 348 |
INCOME TAXES - Components of In
INCOME TAXES - Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Current: | |||
Federal | $ 27,306 | $ 26,423 | $ 25,019 |
Foreign | 7,634 | 7,103 | 7,553 |
State | 4,403 | 3,964 | 3,664 |
Deferred: | |||
Federal | (7,737) | (7,532) | (3,709) |
Foreign | (2,285) | (215) | (3,038) |
State | (603) | (1,361) | (360) |
Total income tax provision | $ 28,718 | $ 28,382 | $ 29,129 |
INCOME TAXES - Effective Income
INCOME TAXES - Effective Income Tax Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Reconciliation [Abstract] | |||
Income tax at Federal statutory rate | $ 28,825 | $ 28,087 | $ 26,299 |
State income taxes, net of Federal income taxes | 2,513 | 1,862 | 2,406 |
Stock Options | (1,004) | (676) | (924) |
Foreign-derived intangible income (FDII) | (1,752) | (1,778) | (1,540) |
Foreign rate differential | 946 | 2,066 | 1,188 |
Other | (810) | (1,179) | 1,700 |
Total income tax provision | $ 28,718 | $ 28,382 | $ 29,129 |
INCOME TAXES - Significant Port
INCOME TAXES - Significant Portions of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets: | ||
Inventories | $ 1,049 | $ 1,038 |
Restricted stock and stock options | 5,565 | 3,932 |
Lease liabilities | 4,812 | 5,439 |
Research and development | 12,653 | 4,134 |
Other | 3,874 | 3,717 |
Total deferred tax assets | 27,953 | 18,260 |
Deferred tax liabilities: | ||
Amortization | (42,351) | (46,688) |
Depreciation | (28,937) | (25,097) |
Prepaid expenses | (421) | (462) |
Foreign currency and interest rate swaps | (647) | (1,456) |
Right of use assets | (4,574) | (5,324) |
Other | (3,047) | (1,995) |
Total deferred tax liabilities | (79,977) | (81,022) |
Valuation allowance | (22) | (22) |
Net deferred tax liability | $ (52,046) | $ (62,784) |
INCOME TAXES - Income Tax Uncer
INCOME TAXES - Income Tax Uncertainties (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of Unrecognized Tax Benefits [Roll Forward] | |||
Balance at beginning of period | $ 5,815 | $ 5,881 | $ 5,335 |
Increases for tax positions of prior years | 1,353 | 2,194 | 806 |
Decreases for tax positions of prior years | (2,518) | (2,260) | (260) |
Balance at end of period | $ 4,650 | $ 5,815 | $ 5,881 |
SEGMENT INFORMATION - Narrative
SEGMENT INFORMATION - Narrative (Details) | 12 Months Ended |
Dec. 31, 2023 segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
SEGMENT INFORMATION - Business
SEGMENT INFORMATION - Business Segment Assets and Net Sales (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||||||||||
Assets | $ 1,597,211 | $ 1,624,512 | $ 1,597,211 | $ 1,624,512 | |||||||
Net sales | 228,699 | $ 229,948 | $ 231,252 | $ 232,540 | 232,531 | $ 244,267 | $ 236,693 | $ 228,867 | 922,439 | 942,358 | $ 799,023 |
Operating Segments | Human Nutrition and Health | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Assets | 1,180,527 | 1,170,238 | 1,180,527 | 1,170,238 | |||||||
Net sales | 550,751 | 527,131 | 442,733 | ||||||||
Operating Segments | Animal Nutrition and Health | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Assets | 166,994 | 175,972 | 166,994 | 175,972 | |||||||
Net sales | 238,326 | 262,297 | 226,776 | ||||||||
Operating Segments | Specialty Products | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Assets | 168,307 | 177,187 | 168,307 | 177,187 | |||||||
Net sales | 125,965 | 131,438 | 117,020 | ||||||||
Other and Unallocated | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Assets | $ 81,383 | $ 101,115 | 81,383 | 101,115 | |||||||
Net sales | $ 7,397 | $ 21,492 | $ 12,494 |
SEGMENT INFORMATION - Busines_2
SEGMENT INFORMATION - Business Segment Earnings Before Income Tax (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||||||||||
Interest and other expense | $ (21,932) | $ (11,437) | $ (2,269) | ||||||||
Earnings before income tax expense | $ 33,267 | $ 36,475 | $ 38,400 | $ 29,119 | $ 25,776 | $ 31,085 | $ 39,258 | $ 37,630 | 137,261 | 133,749 | 125,233 |
Other and Unallocated | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Earnings before income tax expense | (5,381) | (5,784) | (4,728) | ||||||||
Interest and other expense | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Interest and other expense | (21,932) | (11,437) | (2,269) | ||||||||
Human Nutrition and Health | Operating Segments | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Earnings before income tax expense | 102,419 | 82,125 | 76,031 | ||||||||
Animal Nutrition and Health | Operating Segments | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Earnings before income tax expense | 27,576 | 36,056 | 26,179 | ||||||||
Specialty Products | Operating Segments | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Earnings before income tax expense | $ 34,579 | $ 32,789 | $ 30,020 |
SEGMENT INFORMATION - Depreciat
SEGMENT INFORMATION - Depreciation/Amortization (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | $ 54,935 | $ 51,848 | $ 48,879 |
Other and Unallocated | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 1,213 | 3,928 | 3,121 |
Human Nutrition and Health | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 38,568 | 33,728 | 30,012 |
Animal Nutrition and Health | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 7,876 | 6,685 | 7,414 |
Specialty Products | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | $ 7,278 | $ 7,507 | $ 8,332 |
SEGMENT INFORMATION - Capital E
SEGMENT INFORMATION - Capital Expenditures (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||
Capital expenditures | $ 37,274 | $ 49,086 | $ 36,142 |
Amortization of identifiable intangible assets | 28,035 | 27,271 | 25,092 |
Other and Unallocated | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | 331 | 605 | 524 |
Transaction and integration related costs | 1,617 | 3,581 | 1,264 |
Amortization of identifiable intangible assets | 312 | 2,951 | 2,510 |
Human Nutrition and Health | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | 26,415 | 33,668 | 23,714 |
Animal Nutrition and Health | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | 6,993 | 10,809 | 8,100 |
Specialty Products | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | $ 3,535 | $ 4,004 | $ 3,804 |
REVENUE (Details)
REVENUE (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 228,699 | $ 229,948 | $ 231,252 | $ 232,540 | $ 232,531 | $ 244,267 | $ 236,693 | $ 228,867 | $ 922,439 | $ 942,358 | $ 799,023 |
United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 689,601 | 682,238 | 584,661 | ||||||||
Foreign Countries | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 232,838 | 260,120 | 214,362 | ||||||||
Product Sales Revenue | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 919,951 | 939,166 | 794,518 | ||||||||
Royalty Revenue | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 2,488 | $ 3,192 | $ 4,505 |
SUPPLEMENTAL CASH FLOW INFORM_3
SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash Paid for Income Taxes and Interest [Abstract] | |||
Income taxes | $ 35,725 | $ 33,016 | $ 25,355 |
Interest | 25,933 | 11,879 | 4,547 |
Cash Flow, Noncash Investing and Financing Activities Disclosure [Abstract] | |||
Dividends payable | 25,717 | 23,129 | 20,886 |
Contingent consideration liability | $ 0 | $ 11,872 | $ 0 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME - Changes in Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Net foreign currency translation adjustment | $ 16,809 | $ (4,799) | $ (11,255) |
Unrealized (loss) gain on cash flow hedge | (1,406) | 3,564 | 2,707 |
Tax | 341 | (868) | (654) |
Net of tax | (1,065) | 2,696 | 2,053 |
Net change in postretirement benefit plan (see Note 15 for further information) | |||
Prior service loss (gain) arising during the period | 132 | (41) | (4) |
Amortization of prior service gain | 0 | 9 | 74 |
Amortization of loss (gain) | 8 | (2) | (21) |
Total before tax | 140 | (34) | 49 |
Tax | (39) | (24) | (13) |
Net of tax | 101 | (58) | 36 |
Other comprehensive income (loss), net of tax | 15,845 | (2,161) | (9,166) |
Currency swap | |||
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Net foreign currency translation adjustment | (1,455) | 3,851 | 4,766 |
Net change in postretirement benefit plan (see Note 15 for further information) | |||
Net foreign currency translation adjustment tax | $ (471) | $ 1,236 | $ 1,527 |
ACCUMULATED OTHER COMPREHENSI_4
ACCUMULATED OTHER COMPREHENSIVE INCOME - Components of Accumulated Other Comprehensive (Loss)/Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning balance | $ 938,284 | $ 877,015 | $ 828,233 |
Other comprehensive income (loss) | 15,845 | (2,161) | (9,166) |
Ending balance | 1,053,984 | 938,284 | 877,015 |
Total | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning balance | (7,154) | (4,993) | 4,173 |
Other comprehensive income (loss) | 15,845 | (2,161) | (9,166) |
Ending balance | 8,691 | (7,154) | $ (4,993) |
Foreign currency translation adjustment | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning balance | (8,401) | ||
Other comprehensive income (loss) | 16,809 | ||
Ending balance | 8,408 | (8,401) | |
Cash flow hedge | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning balance | 1,065 | ||
Other comprehensive income (loss) | (1,065) | ||
Ending balance | 0 | 1,065 | |
Postretirement benefit plan | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning balance | 182 | ||
Other comprehensive income (loss) | 101 | ||
Ending balance | $ 283 | $ 182 |
EMPLOYEE BENEFIT PLANS - Narrat
EMPLOYEE BENEFIT PLANS - Narrative (Details) $ in Thousands | 12 Months Ended | |||||
Aug. 30, 2022 plan | Jun. 21, 2022 plan | Jan. 01, 2021 plan | Dec. 31, 2023 USD ($) plan | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Defined Benefit Plan Disclosure [Line Items] | ||||||
Number of savings plan | 1 | |||||
401(k) contributions | $ | $ 4,381 | $ 4,363 | $ 4,142 | |||
Number of unfunded plans | 2 | |||||
Number of multiemployer benefit pension plans | 1 | |||||
Contribution rate increase | 4% | 4% | ||||
Deferred compensation liability | $ | $ 10,188 | $ 8,543 | ||||
Kappa | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Number of defined contribution plans | 1 | |||||
Bergstrom | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Number of defined contribution plans | 1 |
EMPLOYEE BENEFIT PLANS - Change
EMPLOYEE BENEFIT PLANS - Changes in Benefit Obligations and Plan Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Postretirement Medical Plans | |||
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | |||
Benefit obligation at beginning of year | $ 1,465 | $ 1,293 | |
Service cost with interest to end of year | 108 | 79 | $ 87 |
Interest cost | 62 | 26 | 23 |
Participant contributions | 23 | 27 | |
Benefits paid | (30) | (69) | |
Actuarial (gain) loss | (233) | 109 | |
Benefit obligation at end of year | 1,395 | 1,465 | 1,293 |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||
Fair value of plan assets at beginning of year | 0 | 0 | |
Employer contributions | 7 | 42 | |
Participant contributions | 23 | 27 | |
Benefits paid | (30) | (69) | |
Fair value of plan assets at end of year | 0 | 0 | 0 |
Pension Plan | |||
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||
Fair value of plan assets at beginning of year | 1,196 | ||
Fair value of plan assets at end of year | 1,240 | 1,196 | |
Pension Plan | Chemogas Defined Pension Plan | |||
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | |||
Benefit obligation at beginning of year | 1,589 | 1,859 | |
Service cost with interest to end of year | 65 | 44 | 67 |
Interest cost | 65 | 17 | 14 |
Participant contributions | 0 | 27 | |
Benefits paid | (188) | (60) | |
Actuarial (gain) loss | 80 | (194) | |
Exchange rate changes | 49 | (104) | |
Benefit obligation at end of year | 1,660 | 1,589 | 1,859 |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||
Fair value of plan assets at beginning of year | 1,196 | 1,175 | |
Actual return on plan assets | 56 | 26 | |
Employer contributions | 138 | 94 | |
Participant contributions | 0 | 27 | |
Benefits paid | (188) | (60) | |
Exchange rate changes | 38 | (66) | |
Fair value of plan assets at end of year | $ 1,240 | $ 1,196 | $ 1,175 |
EMPLOYEE BENEFIT PLANS - Amount
EMPLOYEE BENEFIT PLANS - Amounts Recognized in Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Defined Benefit Plan Disclosure [Line Items] | |||
Unrecognized prior service cost | $ 9 | $ 74 | |
Unrecognized net loss (gain) | (2) | (24) | |
Postretirement Medical Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Accumulated postretirement benefit obligation | (1,395) | (1,465) | |
Fair value of plan assets | 0 | 0 | $ 0 |
Funded status | (1,395) | (1,465) | |
Net amount recognized in consolidated balance sheet (after ASC 715) (included in "Other long-term obligations") | (1,395) | (1,465) | |
Pension Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Accumulated postretirement benefit obligation | (1,660) | (1,589) | |
Fair value of plan assets | 1,240 | 1,196 | |
Funded status | (420) | (393) | |
Net amount recognized in consolidated balance sheet (after ASC 715) (included in "Other long-term obligations") | $ (420) | $ (393) |
EMPLOYEE BENEFIT PLANS - Compon
EMPLOYEE BENEFIT PLANS - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Postretirement Medical Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost with interest to end of year | $ 108 | $ 79 | $ 87 |
Interest cost | 62 | 26 | 23 |
Amortization of prior service cost | 0 | 9 | 74 |
Amortization of loss (gain) | 8 | (2) | (24) |
Total net periodic benefit cost | 178 | 112 | 160 |
Pension Plan | Chemogas Defined Pension Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost with interest to end of year | 65 | 44 | 67 |
Interest cost | 65 | 17 | 14 |
Expected return on plan assets | (42) | (37) | (34) |
Amortization of loss (gain) | 0 | 0 | 3 |
Total net periodic benefit cost | $ 88 | $ 24 | $ 50 |
EMPLOYEE BENEFIT PLANS - Estima
EMPLOYEE BENEFIT PLANS - Estimated Future Employer Contributions and Benefit Payments (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Postretirement Medical Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
2024 | $ 131 |
2025 | 132 |
2026 | 99 |
2027 | 101 |
2028 | 85 |
Years 2029-2033 | 615 |
Pension Plan | Chemogas Defined Pension Plan | |
Defined Benefit Plan Disclosure [Line Items] | |
2024 | 1 |
2025 | 52 |
2026 | 1 |
2027 | 1 |
2028 | 1 |
Years 2029-2033 | $ 1,096 |
EMPLOYEE BENEFIT PLANS - Define
EMPLOYEE BENEFIT PLANS - Defined Benefit Pension Plans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Central States, Southeast and Southwest Areas Pension Fund | |||
Multiemployer Plans [Line Items] | |||
Contributions of Balchem Corporation | $ 1,020 | $ 939 | $ 816 |
EMPLOYEE BENEFIT PLANS - Assump
EMPLOYEE BENEFIT PLANS - Assumptions Used in Calculations (Details) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pension Plan | Chemogas Defined Pension Plan | |||
Benefit Obligatoins | |||
Discount rate | 3.45% | 4% | |
Net Cost | |||
Discount rate | 4% | 1% | 0.75% |
Expected return on assets | 3.25% | 3.25% | 3.25% |
Postretirement Medical Plans | |||
Benefit Obligatoins | |||
Discount rate | 4.15% | 4.40% | |
Net Cost | |||
Discount rate | 4.40% | 2.10% | 1.75% |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 USD ($) financial_instrument | Dec. 31, 2022 USD ($) | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Number of financial instruments held for trading purposes | financial_instrument | 0 | |
Business combination, contingent consideration, liability, noncurrent | $ 100 | $ 11,400 |
Derivative assets | 5,993 | |
Cross-currency swap | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative assets | 4,587 | |
Interest rate swap | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative assets | 1,406 | |
Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Related rabbi trust assets | 10,188 | 8,547 |
Money Market Funds | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | $ 959 | $ 934 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||||||||||
Payments for services | $ 228,699 | $ 229,948 | $ 231,252 | $ 232,540 | $ 232,531 | $ 244,267 | $ 236,693 | $ 228,867 | $ 922,439 | $ 942,358 | $ 799,023 |
Receivables | 125,284 | 131,578 | 125,284 | 131,578 | |||||||
Payables | 55,503 | 57,322 | 55,503 | 57,322 | |||||||
St. Gabriel CC Company, LLC | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Services and raw materials | 28,099 | 29,062 | 22,043 | ||||||||
Receivables | 8,314 | 8,820 | 8,314 | 8,820 | |||||||
Payables | 6,050 | 5,224 | 6,050 | 5,224 | |||||||
St. Gabriel CC Company, LLC | Non-contractual monies owed | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Payables | $ 329 | $ 296 | 329 | 296 | |||||||
St. Gabriel CC Company, LLC | Services Provided | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Payments for services | 4,363 | 4,213 | 3,637 | ||||||||
St. Gabriel CC Company, LLC | Raw Materials Sold | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Payments for services | $ 34,219 | $ 39,853 | $ 27,915 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 USD ($) tranche | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Lessee, Lease, Description [Line Items] | |||
Reasonably certain criterion renewal period | 2 years | ||
Number of lease tranches | tranche | 4 | ||
Operating lease cost | $ | $ 5,307 | $ 4,478 | $ 3,143 |
Years 1 and 2 | Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease term | 1 year | ||
Discount rate | 5.45% | ||
Years 1 and 2 | Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease term | 2 years | ||
Discount rate | 6.72% | ||
Years 3 and 4 | Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease term | 3 years | ||
Discount rate | 6.04% | ||
Years 3 and 4 | Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease term | 4 years | ||
Discount rate | 7.31% | ||
Years 5 through 9 | Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease term | 5 years | ||
Discount rate | 6.38% | ||
Years 5 through 9 | Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease term | 9 years | ||
Discount rate | 7.65% | ||
More than 10 years | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease term | 10 years | ||
More than 10 years | Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Discount rate | 7.10% | ||
More than 10 years | Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Discount rate | 8.37% |
LEASES - Right-of-Use Assets an
LEASES - Right-of-Use Assets and Lease Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Right of use assets | ||
Operating Lease - ROU | $ 17,763 | $ 17,094 |
Finance Leases - ROU | 2,101 | 2,338 |
Total right-of-use assets | 19,864 | 19,432 |
Operating leases liabilities - current | 3,949 | 3,796 |
Finance lease liabilities - current | 272 | 226 |
Total lease liabilities, current | 4,221 | 4,022 |
Operating lease liabilities - non-current | 14,601 | 13,806 |
Finance lease liabilities - non-current | 1,943 | 2,213 |
Total lease liabilities, non-current | $ 16,544 | $ 16,019 |
LEASES - Schedule of Lease Cost
LEASES - Schedule of Lease Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Lease Cost | |||
Operating lease cost | $ 5,307 | $ 4,478 | $ 3,143 |
Amortization of ROU asset | 242 | 210 | 210 |
Interest on lease liabilities | 115 | 125 | 129 |
Total finance lease | 357 | 335 | 339 |
Interest on lease liabilities | 5,664 | 4,813 | 3,482 |
Cash paid for amounts included in the measurement of lease liabilities | |||
Operating cash flows from operating leases | 4,757 | 4,269 | 3,097 |
Operating cash flows from finance leases | 115 | 125 | 129 |
Principal payments on finance lease | 222 | 177 | 159 |
Cash flows from operating and finance leases | 5,094 | 4,571 | 3,385 |
ROU assets obtained in exchange for new operating lease liabilities, net of ROU asset disposals | $ 6,365 | $ 11,488 | $ 3,804 |
Weighted-average remaining lease term - operating leases | 9 years 3 months 29 days | 5 years 7 months 17 days | 4 years 2 months 15 days |
Weighted-average remaining lease term - finance leases | 9 years 25 days | 9 years 11 months 12 days | 11 years 4 months 28 days |
Weighted-average discount rate - operating leases | 7.40% | 2.70% | 3.50% |
Weighted-average discount rate - finance leases | 5% | 5% | 5.10% |
LEASES - Schedule of Aggregate
LEASES - Schedule of Aggregate Future Minimum Rental Payments Required under Non-Cancelable Operating Leases (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Operating And Finance Lease, Liability, To Be Paid [Abstract] | |
2024 | $ 5,407 |
2025 | 4,219 |
2026 | 3,638 |
2027 | 2,736 |
2028 | 2,219 |
Thereafter | 7,717 |
Total minimum lease payments | $ 25,936 |
DERIVATIVE INSTRUMENTS AND HE_3
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Narrative (Details) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 USD ($) derivative | Dec. 31, 2022 USD ($) derivative | Dec. 31, 2021 USD ($) | Jun. 21, 2022 derivative | May 28, 2019 USD ($) | |
Derivative [Line Items] | |||||
Proceeds from settlement of net investment hedge | $ 2,740 | $ 0 | $ 0 | ||
Interest rate swap | Interest Expense | |||||
Derivative [Line Items] | |||||
Net interest income (expense) | $ 1,518 | $ 400 | (2,144) | ||
Forward Contracts | |||||
Derivative [Line Items] | |||||
Contracts | derivative | 0 | 4 | 4 | ||
Net gains on forward contracts | $ 512 | ||||
Designated as hedge | Interest rate swap | |||||
Derivative [Line Items] | |||||
Notional amount of derivatives | $ 108,569 | ||||
Designated as hedge | Interest rate swap | Pay-Fixed Interest Rate | |||||
Derivative [Line Items] | |||||
Fixed interest rate | 2.05% | ||||
Designated as hedge | Cross-currency swap | |||||
Derivative [Line Items] | |||||
Notional amount of derivatives | $ 108,569 | ||||
Designated as hedge | Cross-currency swap | Pay-Fixed Interest Rate | |||||
Derivative [Line Items] | |||||
Fixed interest rate | 0% | ||||
Designated as hedge | Cross-currency swap | Receive-Fixed Interest Rate | |||||
Derivative [Line Items] | |||||
Fixed interest rate | 2.05% | ||||
Designated as hedge | Cross-currency swap | Interest Expense | |||||
Derivative [Line Items] | |||||
Net interest income (expense) | $ 1,119 | $ 2,250 | $ 2,257 |
DERIVATIVE INSTRUMENTS AND HE_4
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Schedule of Fair Value of Derivative Instruments (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Derivative assets | |
Derivative assets | $ 5,993 |
Interest rate swap | |
Derivative assets | |
Derivative assets | 1,406 |
Cross-currency swap | |
Derivative assets | |
Derivative assets | $ 4,587 |
DERIVATIVE INSTRUMENTS AND HE_5
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Schedule of Gains (Losses) on Hedging Instruments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Cash flow hedge (interest rate swap), net of tax | $ (1,065) | $ 2,696 | $ 2,053 |
Net foreign currency translation adjustment | 16,809 | (4,799) | (11,255) |
Losses and gains recognized in accumulated other comprehensive income (loss) | $ (2,520) | $ 6,547 | $ 6,819 |
Interest rate swap | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Unrealized (loss) gain on cash flow hedge, net of taxes of $341, $868, and $654 at December 31, 2023, 2022, and 2021, respectively | Unrealized (loss) gain on cash flow hedge, net of taxes of $341, $868, and $654 at December 31, 2023, 2022, and 2021, respectively | Unrealized (loss) gain on cash flow hedge, net of taxes of $341, $868, and $654 at December 31, 2023, 2022, and 2021, respectively |
Cash flow hedge (interest rate swap), net of tax | $ (1,065) | $ 2,696 | $ 2,053 |
Cross-currency swap | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Net change in postretirement benefit plan, net of taxes of $39, $24, and $13 at December 31, 2023, 2022 and 2021, respectively | Net change in postretirement benefit plan, net of taxes of $39, $24, and $13 at December 31, 2023, 2022 and 2021, respectively | Net change in postretirement benefit plan, net of taxes of $39, $24, and $13 at December 31, 2023, 2022 and 2021, respectively |
Net foreign currency translation adjustment | $ (1,455) | $ 3,851 | $ 4,766 |
QUARTERLY FINANCIAL INFORMATI_3
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net sales | $ 228,699 | $ 229,948 | $ 231,252 | $ 232,540 | $ 232,531 | $ 244,267 | $ 236,693 | $ 228,867 | $ 922,439 | $ 942,358 | $ 799,023 |
Gross margin | 74,993 | 76,544 | 77,349 | 73,170 | 68,639 | 68,430 | 71,876 | 71,506 | 302,056 | 280,451 | 243,174 |
Earnings before income taxes | 33,267 | 36,475 | 38,400 | 29,119 | 25,776 | 31,085 | 39,258 | 37,630 | 137,261 | 133,749 | 125,233 |
Net earnings | $ 26,648 | $ 29,075 | $ 30,110 | $ 22,710 | $ 21,406 | $ 25,249 | $ 29,782 | $ 28,930 | $ 108,543 | $ 105,367 | $ 96,104 |
Basic net earnings per common share (in dollars per share) | $ 0.83 | $ 0.91 | $ 0.94 | $ 0.71 | $ 0.67 | $ 0.79 | $ 0.93 | $ 0.90 | $ 3.38 | $ 3.29 | $ 2.98 |
Diluted net earnings per common share (in dollars per share) | $ 0.82 | $ 0.90 | $ 0.93 | $ 0.70 | $ 0.66 | $ 0.78 | $ 0.92 | $ 0.89 | $ 3.35 | $ 3.25 | $ 2.94 |
VALUATION AND QUALIFYING ACCO_2
VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Allowance for Doubtful Accounts | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning balance | $ 1,226 | $ 928 | $ 2,092 |
Additions charged to costs and expenses | 37 | 401 | 180 |
Adjustments/deductions | (355) | (103) | (1,344) |
Ending balance | 908 | 1,226 | 928 |
Inventory Reserve | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning balance | 2,640 | 1,425 | 2,782 |
Additions charged to costs and expenses | 2,450 | 6,786 | 7,312 |
Adjustments/deductions | (2,627) | (5,571) | (8,669) |
Ending balance | $ 2,463 | $ 2,640 | $ 1,425 |