Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jun. 28, 2020 | Jul. 31, 2020 | Dec. 29, 2019 | |
Cover [Abstract] | |||
Entity Registrant Name | STRATTEC SECURITY CORP | ||
Entity Central Index Key | 0000933034 | ||
Document Type | 10-K | ||
Document Period End Date | Jun. 28, 2020 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --06-28 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Public Float | $ 79,564,000 | ||
Entity Filer Category | Accelerated Filer | ||
Entity Common Stock Shares Outstanding | 3,819,669 | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity File Number | 0-25150 | ||
Entity Incorporation, State or Country Code | WI | ||
Entity Tax Identification Number | 39-1804239 | ||
Entity Address, Address Line One | 3333 West Good Hope Road | ||
Entity Address, City or Town | Milwaukee | ||
Entity Address, State or Province | WI | ||
Entity Address, Postal Zip Code | 53209 | ||
City Area Code | 414 | ||
Local Phone Number | 247-3333 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Documents Incorporated by Reference | Portions of the Proxy Statement dated September 3, 2020, for the Annual Meeting of Shareholders to be held on October 6, 2020. | ||
Title of 12(b) Security | Common Stock, $.01 par value | ||
Trading Symbol | STRT | ||
Security Exchange Name | NASDAQ |
Consolidated Statements of Loss
Consolidated Statements of Loss and Comprehensive (Loss) Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Income Statement [Abstract] | ||
NET SALES | $ 385,300 | $ 487,006 |
Cost of goods sold | 349,854 | 429,206 |
GROSS PROFIT | 35,446 | 57,800 |
Engineering, selling, and administrative expenses | 44,108 | 47,186 |
(LOSS) INCOME FROM OPERATIONS | (8,662) | 10,614 |
Equity (loss) earnings of joint ventures | (209) | 2,783 |
Interest expense | (920) | (1,615) |
Pension termination settlement charge | (31,878) | |
Other income (expense), net | 1,668 | (337) |
LOSS BEFORE BENEFIT FOR INCOME TAXES AND NON- CONTROLLING INTEREST | (8,123) | (20,433) |
Benefit for income taxes | (2,266) | (7,740) |
NET LOSS | (5,857) | (12,693) |
Net income attributable to non-controlling interest | 1,748 | 4,336 |
NET LOSS ATTRIBUTABLE TO STRATTEC SECURITY CORPORATION | (7,605) | (17,029) |
COMPREHENSIVE (LOSS) INCOME: | ||
NET LOSS | (5,857) | (12,693) |
Currency translation adjustments, net of tax | (5,796) | (555) |
Pension and postretirement plans, net of tax | 274 | 19,861 |
TOTAL OTHER COMPREHENSIVE (LOSS) INCOME | (5,522) | 19,306 |
COMPREHENSIVE (LOSS) INCOME | (11,379) | 6,613 |
Comprehensive (loss) income attributable to non-controlling interest | (229) | 4,724 |
COMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO STRATTEC SECURITY CORPORATION | $ (11,150) | $ 1,889 |
LOSS PER SHARE ATTRIBUTABLE TO STRATTEC SECURITY CORPORATION: | ||
Basic | $ (2.04) | $ (4.63) |
Diluted | $ (2.04) | $ (4.63) |
AVERAGE SHARES OUTSTANDING: | ||
Basic | 3,737 | 3,676 |
Diluted | 3,737 | 3,676 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 11,774 | $ 7,809 |
Receivables, less allowance for doubtful accounts of $500 at June 28, 2020 and June 30, 2019 | 41,955 | 84,230 |
Inventories, net | 54,400 | 47,262 |
Customer tooling in progress, net | 8,768 | 8,240 |
Income taxes recoverable | 2,912 | 2,107 |
Other current assets | 5,559 | 6,984 |
Total current assets | 125,368 | 156,632 |
INVESTMENT IN JOINT VENTURES | 22,068 | 23,528 |
DEFERRED INCOME TAXES | 6,490 | 2,933 |
OTHER LONG-TERM ASSETS | 6,471 | 11,523 |
PROPERTY, PLANT AND EQUIPMENT, NET | 105,148 | 118,120 |
Total assets | 265,545 | 312,736 |
CURRENT LIABILITIES: | ||
Accounts payable | 18,549 | 41,889 |
Accrued liabilities: | ||
Payroll and benefits | 13,498 | 17,339 |
Environmental | 1,259 | 1,278 |
Warranty | 8,500 | 7,900 |
Other | 6,334 | 10,857 |
Total current liabilities | 48,140 | 79,263 |
Commitments and Contingencies | ||
BORROWINGS UNDER CREDIT FACILITIES | 35,000 | 42,000 |
ACCRUED PENSION OBLIGATIONS | 1,255 | 1,663 |
ACCRUED POSTRETIREMENT OBLIGATIONS | 701 | 762 |
OTHER LONG-TERM LIABILITIES | 5,008 | 1,232 |
SHAREHOLDERS’ EQUITY: | ||
Common stock, authorized 12,000,000 shares, $.01 par value, issued 7,358,812 shares at June 28, 2020 and 7,304,994 shares at June 30, 2019 | 74 | 73 |
Capital in excess of par value | 97,977 | 96,491 |
Retained earnings | 211,940 | 221,117 |
Accumulated other comprehensive loss | (22,113) | (18,568) |
Less: Treasury stock at cost (3,609,193 shares at June 28, 2020 and 3,613,439 shares at June 30, 2019) | (135,656) | (135,725) |
Total STRATTEC SECURITY CORPORATION shareholders’ equity | 152,222 | 163,388 |
Non-controlling interest | 23,219 | 24,428 |
Total shareholders’ equity | 175,441 | 187,816 |
Total liabilities and shareholders' equity | $ 265,545 | $ 312,736 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
Statement Of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivable | $ 500 | $ 500 |
Common stock, shares authorized | 12,000,000 | 12,000,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares issued | 7,358,812 | 7,304,994 |
Treasury stock, shares | 3,609,193 | 3,613,439 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | Non-controlling interest |
Beginning balance at Jul. 01, 2018 | $ 183,246 | $ 73 | $ 95,140 | $ 236,162 | $ (33,439) | $ (135,778) | $ 21,088 |
Net (loss) income | (12,693) | (17,029) | 4,336 | ||||
Currency translation adjustments, net of tax | (555) | (943) | 388 | ||||
Pension and postretirement funded status adjustment, net of tax | 19,861 | 19,861 | |||||
Reclassification of stranded tax effects | 4,047 | (4,047) | |||||
Cash dividends declared ($0.56 and $0.42 per share for the twelve month period ended 2019 and 2020 respectively) | (2,063) | (2,063) | |||||
Cash dividends paid to non-controlling interests of subsidiaries | (1,384) | (1,384) | |||||
Stock-based compensation | 1,133 | 1,133 | |||||
Stock option exercises | 172 | 172 | |||||
Employee stock purchases | 99 | 46 | 53 | ||||
Ending balance at Jun. 30, 2019 | 187,816 | 73 | 96,491 | 221,117 | (18,568) | (135,725) | 24,428 |
Net (loss) income | (5,857) | (7,605) | 1,748 | ||||
Currency translation adjustments, net of tax | (5,796) | (3,819) | (1,977) | ||||
Pension and postretirement funded status adjustment, net of tax | 274 | 274 | |||||
Cash dividends declared ($0.56 and $0.42 per share for the twelve month period ended 2019 and 2020 respectively) | (1,572) | (1,572) | |||||
Cash dividends paid to non-controlling interests of subsidiaries | (980) | (980) | |||||
Stock-based compensation | 996 | 996 | |||||
Stock option exercises | 477 | 1 | 476 | ||||
Employee stock purchases | 83 | 14 | 69 | ||||
Ending balance at Jun. 28, 2020 | $ 175,441 | $ 74 | $ 97,977 | $ 211,940 | $ (22,113) | $ (135,656) | $ 23,219 |
Consolidated Statements of Sh_2
Consolidated Statements of Shareholders' Equity (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Statement Of Stockholders Equity [Abstract] | ||
Pension and postretirement funded status adjustment tax impact | $ 85 | $ 6,101 |
Cash dividends declared per share | $ 0.42 | $ 0.56 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
NET LOSS | $ (5,857) | $ (12,693) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Equity loss (earnings) of joint ventures | 209 | (2,783) |
Depreciation | 19,329 | 17,159 |
Foreign currency transaction (gain) loss | (1,982) | 397 |
Unrealized loss (gain) on peso forward contracts | 480 | (39) |
Loss on disposition of property, plant and equipment | 369 | 106 |
Pension termination settlement charge | 31,878 | |
Non-cash compensation expense | 4,824 | 4,195 |
Deferred income taxes | (3,589) | (10,122) |
Stock-based compensation expense | 996 | 1,133 |
Change in operating assets and liabilities: | ||
Receivables | 41,990 | (10,392) |
Inventories | (7,138) | (608) |
Other assets | (29) | 5,855 |
Accounts payable and accrued liabilities | (24,207) | 6,141 |
Other, net | 29 | (286) |
Net cash provided by operating activities | 25,424 | 29,941 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Investment in joint ventures | (200) | |
Additions to property, plant and equipment | (12,381) | (17,453) |
Proceeds received on sale of property, plant and equipment | 32 | 53 |
Net cash used in investing activities | (12,349) | (17,600) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Borrowings under credit facilities | 8,000 | 5,000 |
Repayments under credit facilities | (15,000) | (14,000) |
Exercise of stock options and employee stock purchases | 560 | 271 |
Dividends paid to non-controlling interests of subsidiaries | (980) | (1,384) |
Dividends paid | (1,572) | (2,063) |
Net cash used in financing activities | (8,992) | (12,176) |
FOREIGN CURRENCY IMPACT ON CASH | (118) | (446) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 3,965 | (281) |
CASH AND CASH EQUIVALENTS | ||
Beginning of year | 7,809 | 8,090 |
End of year | 11,774 | 7,809 |
Cash Paid During the Period For: | ||
Income taxes | 2,113 | 530 |
Interest | 976 | 1,624 |
Non-Cash Investing Activities: | ||
Change in capital expenditures in accounts payable | $ (951) | $ 467 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Jun. 28, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization and Summary of Significant Accounting Policies | ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES STRATTEC SECURITY CORPORATION designs, develops, manufactures and markets automotive access control products including mechanical locks and keys, electronically enhanced locks and keys, passive entry passive start systems (PEPS), steering column and instrument panel ignition lock housings, latches, power sliding side door systems, power tailgate systems, power lift gate systems, power deck lid systems, door handles and related products for primarily North American automotive customers. We also supply global automotive manufacturers through a unique strategic relationship with WITTE Automotive (“WITTE”) of Velbert, Germany and ADAC Automotive (“ADAC”) of Grand Rapids, Michigan. Under this relationship, STRATTEC, WITTE and ADAC market the products of each company to global customers under the “VAST Automotive Group” brand name (as more fully described herein). STRATTEC products are shipped to customer locations in the United States, Canada, Mexico, Europe, South America, Korea, China and India, and we provide full service and aftermarket support for each VAST Automotive Group partner’s products. We also maintained a 51 percent interest in a joint venture, STRATTEC Advanced Logic, LLC (“SAL LLC”), which was established to introduce a new generation of commercial and residential biometric security products based on the designs of Actuator Systems, our partner and the owner of the remaining ownership interest. SAL LLC was dissolved during fiscal 2020. The accompanying consolidated financial statements reflect the consolidated results of STRATTEC SECURITY CORPORATION, its wholly owned Mexican subsidiary, STRATTEC de Mexico, and its majority owned subsidiaries, ADAC-STRATTEC, LLC and STRATTEC POWER ACCESS LLC. STRATTEC SECURITY CORPORATION is located in Milwaukee, Wisconsin. STRATTEC de Mexico is located in Juarez, Mexico. ADAC-STRATTEC, LLC and STRATTEC POWER ACCESS LLC have operations in El Paso, Texas and in Juarez and Leon, Mexico. Equity investments in Vehicle Access Systems Technology LLC (“VAST LLC”) and SAL LLC for which we exercise significant influence but do not control and are not the primary beneficiary, are accounted for using the equity method. VAST LLC consists primarily of four wholly owned subsidiaries in China, one wholly owned subsidiary in Brazil and one joint venture entity in India. The results of the VAST LLC foreign subsidiaries and joint venture are reported on a one-month lag basis. SAL LLC was located in El Paso, Texas. We have only one reporting segment. Risks and Uncertainties: In December 2019, a novel strain of coronavirus (COVID-19) was reported in Wuhan, China. The coronavirus has since spread, and infections have been found in multiple countries around the world, including the United States. In March 2020, the World Health Organization recognized the COVID-19 outbreak as a pandemic based on the global spread of the disease, the severity of illnesses it causes and its effects on society. In response to the COVID-19 outbreak, the governments of many countries, states, cities and other geographic regions have taken preventative or protective actions, such as imposing restrictions on travel and business operations and advising or requiring individuals to limit or forego their time outside of their homes. Accordingly, the COVID-19 outbreak has severely restricted the level of economic activity in many countries, and continues to adversely impact global economic activity. STRATTEC’s operating performance is subject to global economic conditions and levels of consumer spending specifically within the automotive industry. During fiscal 2020, the impact of the COVID-19 outbreak reduced our sales by approximately $78 million, which negatively impacted our operating results. The extent of the impact of the COVID-19 outbreak on our future operating results will depend on certain developments, including the duration, intensity and continued spread of the outbreak, regulatory and private sector responses, which may be precautionary, and the impact to our customers, workforce and suppliers, all of which are uncertain and cannot be predicted. These changing conditions may also affect the estimates and assumptions made by management. Such estimates and assumptions affect, among other things, our long-lived asset valuations, equity investment valuation, assessment of our annual effective tax rate, valuation of deferred income taxes, assessment of excess and obsolete inventory reserves, and assessment of collectability of trade receivables. Events and changes in circumstances arising after June 28, 2020, including those resulting from the impacts of COVID-19, will be in management’s estimates for future periods. During the period late March 2020 through mid-June 2020, the majority of our OEM customer assembly plant operations were completely closed including the majority of the supply chain. Additionally, during this same period, STRATTEC’s Mexico facilities were closed as a result of the Mexican government’s shutdown of non-essential businesses. Re-opening of our OEM customer facilities and our Mexico facilities began in June 2020. As of June 28, 2020, our Mexican facilities were open with 50 percent of the workforce allowed to return. Based on information available, our current estimates indicate the continued ramp-up of the automotive industry resulting in an increase in our net sales for the upcoming fiscal year compared to our fiscal 2020. Such estimates are dependent on the severity of the impacts of COVID-19 and any worsening of the impact of the pandemic on society. We anticipate our fourth fiscal quarter of 2020 was the worst or trough quarter and that thereafter the automotive industry will continue to ramp back-up production during our fiscal 2021. We expect the impact on our overall cash liquidity will be most significant at the beginning of our fiscal year 2021 with a reduction in payments from customers resulting from lower fourth quarter fiscal 2020 net sales as previously discussed. We expect that this lower cash liquidity will cause us to utilize our credit facilities to fund our increased working capital requirements in fiscal 2021. Significant Accounting Policies: The significant accounting policies followed in the preparation of these financial statements, as summarized in the following paragraphs, are in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP). Principles of Consolidation and Presentation: The accompanying consolidated financial statements include the accounts of STRATTEC SECURITY CORPORATION, its wholly owned Mexican subsidiary and its majority owned subsidiaries. Equity investments for which STRATTEC exercises significant influence but does not control and is not the primary beneficiary are accounted for using the equity method. All significant inter-company transactions and balances have been eliminated. New Accounting Standards: In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses . The update revises the methodology for measuring credit losses on financial instruments and the timing of when such losses are recorded. Originally, the update was effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted. In November 2019, FASB issued ASU 2019-10, Financial Instruments – Credit Losses, Derivatives and Hedging, and Leases . This ASU defers the effective date of ASU 2016-13 for public companies that are considered smaller reporting companies as defined by the SEC to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. We are planning to adopt this standard in the first quarter of our fiscal 2024.We are currently evaluating the potential effects of adopting the new guidance on our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation In December 2019, the FASB issued ASU 2019-12, Income Taxes In March 2020, the FASB issued ASU 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which Fiscal Year: Our fiscal year ends on the Sunday nearest June 30. The years ended June 28, 2020 and June 30, 2019 are each comprised of 52 weeks Use of Estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses for the periods presented. These estimates and assumptions could also affect the disclosure of contingencies. Actual results and outcomes may differ from management’s estimates and assumptions. Cash and Cash Equivalents: Cash and cash equivalents include all short-term investments with an original maturity of three months or less due to the short-term nature of the instruments. Excess cash balances are placed in short-term commercial paper. Derivative Instruments: We own and operate manufacturing operations in Mexico. As a result, a portion of our manufacturing costs are incurred in Mexican pesos, which causes our earnings and cash flows to fluctuate due to changes in the U.S. dollar/Mexican peso exchange rate. We have contracts with Bank of Montreal that provide for monthly Mexican peso currency forward contracts for a portion of our estimated peso denominated operating costs. Our objective in entering into currency forward contracts is to minimize our earnings volatility resulting from changes in exchange rates affecting the U.S. dollar cost of our Mexican operations. The Mexican peso forward contracts are not used for speculative purposes and are not designated as hedges. As a result, all currency forward contracts are recognized in our accompanying condensed consolidated financial statements at fair value and changes in the fair value are reported in current earnings as part of Other Income (Expense), net. The following table quantifies the outstanding Mexican peso forward contracts as of June 28, 2020 (thousands of dollars, except with respect to the average forward contractual exchange rate): Effective Dates Notional Amount Average Forward Contractual Exchange Rate Fair Value Buy MXP/Sell USD July 15, 2020 - December 16, 2020 $ 6,000 21.40 $ (480 ) The fair market value of all outstanding Mexican peso forward contracts in the accompanying Consolidated Balance Sheets was as follows (thousands of dollars): June 28, 2020 June 30, 2019 Not designated as hedging instruments: Other current liabilities: Mexican peso forward contracts $ 480 $ — The pre-tax effects of the Mexican peso forward contracts on the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income consisted of the following (thousands of dollars): Other Income, net Years Ended June 28, 2020 June 30, 2019 Not Designated as Hedging Instruments: Realized (loss) gain $ (418 ) $ 485 Unrealized (loss) gain $ (480 ) $ 39 Fair Value of Financial Instruments: The fair value of our cash and cash equivalents, accounts receivable, accounts payable and borrowings under our credit facilities approximated their book value as of June 28, 2020 and June 30, 2019. Fair value is defined as the exchange price that would be received for an asset or paid for a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. There is an established fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable. Level 1 – Quoted prices in active markets for identical assets or liabilities. These are typically obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 – Inputs, other than quoted prices included within Level 1, which are observable for the asset or liability, either directly or indirectly. These are typically obtained from readily-available pricing sources for comparable instruments. Level 3 – Unobservable inputs, where there is little or no market activity for the asset or liability. These inputs reflect the reporting entity’s own assumptions of the data that market participants would use in pricing the asset or liability, based on the best information available in the circumstances. The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of June 28, 2020 and June 30, 2019 (thousands of dollars): June 28, 2020 June 30, 2019 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Rabbi Trust assets: Stock index funds: Small cap $ 251 $ — $ — $ 251 $ 276 $ — $ — $ 276 Mid cap 284 — — 284 293 — — 293 Large cap 563 — — 563 589 — — 589 International 820 — — 820 864 — — 864 Fixed income funds 793 — — 793 913 — — 913 Cash and cash equivalents — 224 — 224 — 3 — 3 Total assets at fair value $ 2,711 $ 224 $ — $ 2,935 $ 2,935 $ 3 $ — $ 2,938 Liabilities: Mexican peso forward contracts $ — $ 480 $ — $ — $ — $ — $ — $ — The Rabbi Trust assets fund our supplemental executive retirement plan and are primarily included in Other Long-Term Assets in the accompanying Consolidated Balance Sheets. Refer to discussion of Mexican peso forward contracts under Derivative Instruments above. The fair value of the Mexican peso forward contracts considers the remaining term, current exchange rate and interest rate differentials between the two currencies. Receivables: Receivables consist primarily of trade receivables due from Original Equipment Manufacturers in the automotive industry and locksmith/dealership distributors relating to our service and aftermarket sales. We evaluate the collectability of receivables based on a number of factors. An allowance for doubtful accounts is recorded for significant past due receivable balances based on a review of the past due items, general economic conditions (including with respect to the impact of COVID-19 on our customers) and the industry as a whole. The allowance for doubtful accounts totaled $500,000 at June 28, 2020 and June 30, 2019. Inventories: Inventories are comprised of material, direct labor and manufacturing overhead, and are stated at net realizable value using the first-in, first-out (“FIFO”) cost method of accounting. Inventories consisted of the following (thousands of dollars): June 28, 2020 June 30, 2019 Finished products $ 13,142 $ 11,582 Work in process 11,815 10,529 Purchased materials 34,333 29,376 59,290 51,487 Excess and obsolete reserve (4,890 ) (4,225 ) Inventories, net $ 54,400 $ 47,262 We record a reserve for excess and obsolete inventory based on historical and estimated future demand and market conditions. The reserve level is determined by comparing inventory levels of individual materials and parts to historical usage and estimated future sales by analyzing the age of the inventory in order to identify specific materials and parts that are unlikely to be sold. Technical obsolescence and other known factors are also considered in evaluating the reserve level. The activity related to the excess and obsolete inventory reserve was as follows (thousands of dollars): Balance, Beginning of Year Provision Charged to Expense Amounts Written Off Balance, End of Year Year ended June 28, 2020 $ 4,225 $ 2,178 $ 1,513 $ 4,890 Year ended June 30, 2019 $ 4,000 $ 799 $ 574 $ 4,225 Customer Tooling in Progress: We incur costs related to tooling used in component production and assembly. Costs for development of certain tooling, which will be directly reimbursed by the customer whose parts are produced from the tool, are accumulated on the balance sheet and are then billed to the customer. The accumulated costs are billed upon formal acceptance by the customer of products produced with the individual tool. Other tooling costs are not directly reimbursed by the customer. We capitalize and amortize these other tooling costs over the life of the related product based on the fact that the related tool will be used over the life of the supply arrangement. To the extent that estimated costs exceed expected reimbursement from the customer we recognize a loss. Property, Plant and Equipment: Property, plant and equipment are stated at cost. Property, plant and equipment are depreciated on a straight-line basis over the estimated useful lives of the assets as follows: Classification Expected Useful Lives Land improvements 20 years Buildings and improvements 15 to 35 years Machinery and equipment 3 to 15 years Property, plant and equipment consisted of the following (thousands of dollars): June 28, 2020 June 30, 2019 Land and improvements $ 5,002 $ 5,679 Buildings and improvements 33,179 35,742 Machinery and equipment 228,035 246,000 266,216 287,421 Less: accumulated depreciation (161,068 ) (169,301 ) $ 105,148 $ 118,120 Depreciation expense was as follows for the periods indicated (thousands of dollars): Fiscal Year Depreciation Expense 2020 $ 19,329 2019 $ 17,159 The gross and net book value of property, plant and equipment located outside of the United States, primarily in Mexico, were as follows (thousands of dollars): June 28, 2020 June 30, 2019 Gross book value $ 146,690 $ 157,551 Net book value $ 71,369 $ 80,922 Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such indicators are present, the recoverability of assets to be held and used is assessed by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the asset. If an asset is determined to not be recoverable, the impairment recognized is calculated as the excess of the carrying amount of the asset over the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less estimated costs to sell. There were no impairments recorded in the years ended June 28, 2020 or June 30, 2019. Expenditures for repairs and maintenance are charged to expense as incurred. Expenditures for major renewals and betterments, which significantly extend the useful lives of existing plant and equipment, are capitalized and depreciated. Upon retirement or disposition of plant and equipment, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in income. Leases: Our right-of-use operating lease assets are recorded at the present value of future minimum lease payments, net of amortization. We have an operating lease for our El Paso, Texas finished goods and service parts distribution warehouse that has a current lease term through October 2023. This lease includes renewal terms that can extend the lease term for five additional years. For purposes of calculating operating lease obligations, we included the option to extend the lease as it is reasonably certain that we will exercise such option. The lease does not contain material residual value guarantees or restrictive covenants. Operating lease expense is recognized on a straight-line basis over the lease term. As the lease does not provide an implicit rate, we used our incremental borrowing rate at lease commencement to determine the present value of our lease payments. The incremental borrowing rate is an entity-specific rate which represents the rate of interest we would pay to borrow over a similar term with similar payments. The operating lease asset and obligation related to our El Paso warehouse lease included in the accompanying Condensed Consolidated Balance Sheet are presented below (thousands of dollars): June 28, 2020 Right-of-Use Asset Under Operating Lease: Other Long-Term Assets $ 3,753 Lease Obligation Under Operating Lease: Current Liabilities: Accrued Liabilities: Other $ 354 Other Long-Term Liabilities 3,399 $ 3,753 Future minimum lease payments, by our fiscal year, including options to extend that are reasonably certain to be exercised, under the non-cancelable lease are as follows as of June 28, 2020 (thousands of dollars): 2021 $ 473 2022 484 2023 497 2024 509 Thereafter 2,356 Total Future Minimum Lease Payments 4,319 Less: Imputed Interest (566 ) Total Lease Obligations $ 3,753 Future minimum lease payments, by our fiscal year, excluding options to extend that are reasonably certain to be exercised, prior to the adoption of the new accounting guidance on leases were as follows as of June 30, 2019 (thousands of dollars): 2020 $ 539 2021 504 2022 495 2023 498 2024 168 Thereafter — Total Future Minimum Lease Payments $ 2,204 Cash flow information related to the operating lease is shown below (thousands of dollars): Year Ended June 28, 2020 Operating Cash Flows: Cash Paid Related to Operating Lease Obligation $ 461 Non-Cash Activity: Right-of-Use Asset Obtained in Exchange for Operating Lease Obligation $ — The weighted average lease term and discount rate for the El Paso, Texas operating lease are shown below: June 28, 2020 Weighted Average Remaining Lease Term (in years) 8.3 Weighted Average Discount Rate 3.3 % Operating lease expense for the year ended June 28, 2020 totaled $461,000. Rental expense for the year ended June 30, 2019 totaled $773,000. Supplier Concentrations: The following inventory purchases were made from major suppliers during each fiscal year noted Fiscal Year Percentage of Inventory Purchases Number of Suppliers 2020 39 % 7 2019 39 % 7 We have long-term contracts or arrangements with most of our suppliers to guarantee the availability of raw materials and component parts. Labor Concentrations: We had approximately 3,831 full-time associates of which approximately 200 or 5.2 percent were represented by a labor union at June 28, 2020. The associates represented by a labor union account for all production associates at our Milwaukee facility. The current contract with the unionized associates is effective through September 17, 2021. Revenue Recognition: We generate revenue from the production of parts sold to automotive and light-truck Original Equipment Manufacturers (“OEMs”), or Tier 1 suppliers at the direction of the OEM, under long-term supply agreements supporting new vehicle production. Such agreements also require related production of service parts subsequent to the initial vehicle production periods. Additionally, we generate revenue from the production of parts sold in aftermarket service channels and to non-automotive commercial customers. Revenue Recognition: Our contracts with customers under long-term supply agreements do not commit the customer to a specified quantity of parts. However, we are generally required to fulfill our customers’ purchasing requirements for the production life of the vehicle. Contracts do not become a performance obligation until we receive either a purchase order and/or customer release for a specific number of parts at a specified price. While long-term supply agreements may range from four to six years for new vehicle production and ten to fifteen subsequent years for service parts production, contracts may be terminated by customers at any time. Historically, terminations have been minimal. Contracts may also provide for annual price reductions over the production life of the vehicle, and prices are adjusted on an ongoing basis to reflect changes in product content/cost and other commercial factors. Revenue is recognized at a point in time when control of the parts produced are transferred to the customer according to the terms of the contract, which is usually when the parts are shipped or delivered to the customer’s premises. Customers are generally invoiced upon shipment or delivery and payment generally occurs within 45 to 90 days after the shipment date. The amount of revenue recognized reflects the consideration that we expect to be entitled to receive in exchange for those products based on purchase orders, annual price reductions and ongoing price adjustments, some of which are accounted for as variable consideration. We use the most likely amount method, the single most likely outcome of the contract, to estimate the amount to which we expect to be entitled. There were no significant changes to our estimates of variable consideration during the reporting periods referenced in our accompanying financial statements and significant changes to our estimates of variable consideration are not expected in future periods. We do not have an enforceable right to payment at any time prior to when the parts are shipped or delivered to the customer. Therefore, we recognize revenue at the point in time we satisfy a performance obligation by transferring control of a part to a customer. Amounts billed to customers related to shipping and handling costs are included in Net Sales in the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income. Shipping and handling costs are accounted for as fulfillment costs and are included in Cost of Goods Sold in the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income. Tooling and Pre-Production Engineering Costs Related to Long-Term Supply Arrangements: We incur pre-production engineering and tooling costs related to the products produced for our customers under long-term supply agreements. Customer reimbursements for tooling and pre-production engineering activities that are part of a long-term supply arrangement are accounted for as a reduction of cost in accordance with ASC 340, Other Assets and Deferred Costs. Pre-production costs related to long-term supply agreements with a contractual guarantee for reimbursement are included in Other Current Assets in the accompanying Consolidated Balance Sheets. We expense all pre-production engineering costs for which reimbursement is not contractually guaranteed by the customer. All pre-production tooling costs related to customer-owned tools for which reimbursement is not contractually guaranteed by the customer or for which we do not have a non-cancelable right to use the tooling is also expensed when incurred. Receivables, net: Receivables, net include amounts billed and currently due from customers. We maintain an allowance for doubtful accounts to provide for estimated amounts of receivables not expected to be collected. We continually assess our receivables for collectability and any allowance is recorded based upon age of the outstanding receivables, historical payment experience, customer creditworthiness and general economic conditions. Contract Balances: We have no material contract assets as of June 28, 2020. Contract liability balances primarily include discounts recognized as a reduction in sales at the point of revenue recognition, but which will be applied by the customer agreement after the end of the reporting period. The activity related to contract liability balances during the year ended June 28, 2020 was as follows (thousands of dollars): Balance, June 30, 2019 $ 932 Discounts Recorded as a Reduction in Sales 1,048 Payments of Discounts to Customers (915 ) Other (692 ) Balance, June 28, 2020 $ 373 Refer to Product Sales and Sales and Receivable Concentration included herein for revenue by product group and revenue by customer. Research and Development Costs: Expenditures relating to the development of new products and processes, including significant improvements and refinements to existing products, are expensed as incurred. Research and development expenditures were approximately $9.8 million in 2020 and $13.8 million in 2019. Other Income (Expense), Net: Net other income (expense) included in the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income primarily included foreign currency transaction gains and losses, realized and unrealized gains and losses on our Mexican peso currency forward contracts, the components of net periodic benefit cost other than the service cost component related to our pension and postretirement plans and Rabbi Trust gains and losses. Foreign currency transaction gains and losses resulted from activity associated with foreign denominated assets held by our Mexican subsidiaries. The Rabbi Trust assets fund our amended and restated supplemental executive retirement plan. The investments held in the Trust are considered trading securities. We entered into the Mexican peso currency forward contracts during fiscal 2020 and 2019 to minimize earnings volatility resulting from changes in exchange rates affecting the U.S. dollar cost of our Mexican operations. Unrealized gains and losses on the peso forward contracts recognized as a result of mark-to-market adjustments as of June 28, 2020 may or may not be realized in future periods, depending on actual Mexican peso to U.S. dollar exchange rates experienced during the balance of the contract period. Pension and postretirement plan costs include the components of net periodic benefit cost other than the service cost component. Additionally, during fiscal 2020, other miscellaneous income, net includes $450,000 of favorable valued-added tax adjustments realized by our Mexican entities and $434,000 of experience gains from asset returns related to the termination of our Qualified Pension Plan as discussed under Retirement Plans and Postretirement Costs. Years Ended June 28, 2020 June 30, 2019 Foreign currency transaction gain (loss) $ 1,982 $ (397 ) Rabbi Trust (loss) gain (2 ) 146 Unrealized (loss) gain on Mexican peso forward contracts (480 ) 39 Realized (loss) gain on Mexican peso forward contracts (418 ) 485 Pension and postretirement plans cost (469 ) (689 ) Other 1,055 79 $ 1,668 $ (337 ) Warranty Reserve: We have a warranty liability recorded related to our known and potential exposure to warranty claims in the event our products fail to perform as expected, and in the event we may be required to participate in the repair costs incurred by our customers for such products. The recorded warranty liability balance involves judgment and estimates. Our liability estimate is based on an analysis of historical warranty data as well as current trends and information, including our customers’ recent extension and/or expansion of their warranty programs. In recent fiscal periods, our largest customers have extended their warranty protection for their vehicles and have since demanded higher warranty cost sharing arrangements from their suppliers in their terms and conditions to purchase, including from STRATTEC. As additional information becomes available, actual results may differ from recorded estimates, which may require us to adjust the amount of our warranty provision. Changes in the warranty reserve were as follows (thousands of dollars): Balance, Beginning of Year Provision Charged to Expense Payments Balance, End of Year Year ended June 28, 2020 $ 7,900 $ 823 $ 223 $ 8,500 Year ended June 30, 2019 $ 7,800 $ 559 $ 459 $ 7,900 Foreign Currency Translation: The financial statements of our foreign subsidiaries and equity investees are translated into U.S. dollars using the exchange rate at each balance sheet date for assets and liabilities and the average exchange rate for each applicable period for sales, costs and expenses. Foreign currency translation adjustments are included as a component of accumulated other comprehensive loss. Foreign currency transaction gains and losses are included in other income (expense), net in the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income. Accumulated Other Comprehensive Loss: Accumulated other comprehensive loss (“AOCL”) was comprised of the following (thousands of dollars): June 28, 2020 June 30, 2019 Unrecognized pension and postretirement benefit liabilities, net of tax $ 1,977 $ 2,251 Foreign currency translation, net of tax 20,136 16,317 $ 22,113 $ 18,568 The following tables summarize the changes in AOCL for the years ended June 28, 2020 and June 30, 2019 (thousands of dollars): Year Ended June 28, 2020 Foreign Currency Translation Adjustments Retirement and Postretirement Plans Total Balance June 30, 2019 $ 16,317 $ 2,251 $ 18,568 Other comprehensive loss before reclassifications 6,153 25 6,178 Income Tax (357 ) (6 ) (363 ) Net other comprehensive loss before Reclassifications 5,796 19 5,815 Reclassifications: Prior service credits (A) — 29 29 Actuarial losses (A) — (412 ) (412 ) Total reclassificat |
Investment in Joint Ventures an
Investment in Joint Ventures and Majority Owned Subsidiaries | 12 Months Ended |
Jun. 28, 2020 | |
Equity Method Investments And Joint Ventures [Abstract] | |
Investment in Joint Ventures and Majority Owned Subsidiaries | INVESTMENT IN JOINT VENTURES AND MAJORITY OWNED SUBSIDIARIES We participate in certain Alliance Agreements with WITTE Automotive (“WITTE”) and ADAC Automotive (“ADAC”). WITTE, of Velbert, Germany, is a privately held automotive supplier. WITTE designs, manufactures and markets automotive components, including locks and keys, hood latches, rear compartment latches, seat back latches, door handles and specialty fasteners. WITTE’s primary market for these products has been Europe. ADAC, of Grand Rapids, Michigan, is a privately held automotive supplier and manufactures engineered products, including door handles and other automotive trim parts, utilizing plastic injection molding, automated painting and various assembly processes. The Alliance Agreements include a set of cross-licensing agreements for the manufacture, distribution and sale of WITTE products by STRATTEC and ADAC in North America, and the manufacture, distribution and sale of STRATTEC and ADAC products by WITTE in Europe. Additionally, a joint venture company, Vehicle Access Systems Technology LLC (“VAST LLC”), in which WITTE, STRATTEC and ADAC each hold a one-third VAST LLC has investments in Sistema de Acesso Veicular Ltda, VAST Fuzhou, VAST Great Shanghai, VAST Shanghai Co., VAST Jingzhou Co. Ltd., and Minda-VAST Access Systems. Sistema de Acesso Veicular Ltda is located in Brazil and services customers in South America. VAST Fuzhou, VAST Great Shanghai, VAST Shanghai Co. and VAST Jingzhou Co. Ltd. (collectively known as VAST China), provide a base of operations to service each VAST partner’s automotive customers in the Asian market. Minda-VAST Access Systems is based in Pune, India and is a 50:50 joint venture between VAST LLC and Minda Management Services Limited, an affiliate of both Minda Corporation Limited and Spark Minda, Ashok Minda Group of New Delhi, India (collectively “Minda”). Minda and its affiliates cater to the needs of all major car, motorcycle, commercial vehicle, tractor and off-road vehicle manufacturers in India. They are a leading manufacturer in the Indian marketplace of security & access products, handles, automotive safety, restraint systems, driver information and telematics systems for both OEMs and the aftermarket. VAST LLC also maintains branch offices in South Korea and Japan in support of customer sales and engineering requirements. The VAST LLC investments are accounted for using the equity method of accounting and the results of the VAST LLC foreign subsidiaries and joint venture are reported on a one-month lag basis. The activities related to the VAST LLC joint ventures resulted in equity loss of joint ventures to STRATTEC of approximately $565,000 during 2020 and equity earnings of joint ventures of approximately $2.7 million during 2019. The current year equity loss of joint ventures for VAST LLC included a $2 million impairment charge related to its Minda-VAST Access Systems joint venture in India. STRATTEC’s portion of this impairment charge for 2020 totaled $667,000. During 2020, no capital contributions were made to VAST LLC. During 2019, capital contributions totaling $600,000 were made to VAST LLC for purposes of funding operations in Brazil. STRATTEC’s portion of the capital contributions totaled and $200,000. ADAC-STRATTEC LLC, a Delaware limited liability company, was formed in fiscal year 2007 to support injection molding and door handle assembly operations in Mexico. ADAC-STRATTEC LLC was 51 percent owned by STRATTEC and 49 percent owned by ADAC for all periods presented in this report. An additional Mexican entity, ADAC-STRATTEC de Mexico, is wholly owned by ADAC-STRATTEC LLC. ADAC-STRATTEC LLC’s financial results are consolidated with the financial results of STRATTEC and resulted in increased net income to STRATTEC of approximately $1.5 million in 2020 and $2.7 million in 2019. ADAC-STRATTEC LLC incurs an engineering, research and design fee as well as a sales fee with ADAC. Such fees are calculated as a percentage of ADAC-STRATTEC LLC net sales, are included in the consolidated results of STRATTEC, and totaled $6.9 million in 2020 and $8.2 million in 2019. The related outstanding payable balance to ADAC was $658,000 and $1.5 million as of June 28, 2020 and June 30, 2019, respectively. Additionally, ADAC-STRATTEC LLC has sales of production parts to ADAC. Sales to ADAC are included in the consolidated results of STRATTEC and totaled $10.2 million in 2020 and $15.3 million in 2019. The related outstanding receivable balance from ADAC was $1.0 million and $2.1 million as of June 28, 2020 and June 30, 2019, respectively. STRATTEC POWER ACCESS LLC (“SPA”) was formed in fiscal year 2009 to supply the North American portion of the power sliding door, lift gate and deck lid system access control products which were acquired from Delphi Corporation. SPA was 80 percent owned by STRATTEC and 20 percent owned by WITTE for all periods presented in this report. An additional Mexican entity, STRATTEC POWER ACCESS de Mexico, is wholly owned by SPA. The financial results of SPA are consolidated with the financial results of STRATTEC and resulted in reduced net income to STRATTEC of approximately $1.3 million in 2020 and increased net income to STRATTEC of approximately $2.5 million in 2019. STRATTEC purchases production parts from WITTE. Purchases totaled $1.0 million in 2020 and $1.3 million in 2019. The outstanding payable balance to WITTE was $21,000 and $153,000 as of June 28, 2020 and June 30, 2019, respectively. SAL LLC, which was 51 percent owned by STRATTEC, was formed in fiscal 2013 to introduce a new generation of biometric security products based upon the designs of Actuator Systems LLC, our partner and the owner of the remaining ownership interest. SAL was dissolved during our fiscal 2020 fourth quarter. Our investment in SAL LLC, for which we exercised significant influence but did not control and were not the primary beneficiary, was accounted for using the equity method. The activities related to SAL LLC resulted in equity earnings of joint ventures to STRATTEC of approximately $356,000 in 2020 and approximately $128,000 in 2019. The current year equity earnings of SAL LLC includes a gain on dissolution of $342,000. STRATTEC’s joint venture investments are included in the accompanying Consolidated Balance Sheets as follows (thousands of dollars): June 28, 2020 June 30, 2019 Investment in Joint Ventures: Investment in VAST LLC $ 22,068 $ 23,528 Other Current Liabilities: Investment in SAL LLC $ — $ 328 See further discussion under Equity (Loss) Earnings of Joint Ventures included in Notes to Financial Statements herein. |
Equity (Loss) Earnings of Joint
Equity (Loss) Earnings of Joint Ventures | 12 Months Ended |
Jun. 28, 2020 | |
Equity Method Investments And Joint Ventures [Abstract] | |
Equity (Loss) Earnings of Joint Ventures | EQUITY (LOSS) EARNINGS OF JOINT VENTURES As discussed above under the note Investment in Joint Ventures and Majority Owned Subsidiaries, we hold a one-third Years Ended June 28, 2020 June 30, 2019 Net sales $ 153,006 $ 161,660 Cost of goods sold 125,012 128,375 Gross profit 27,994 33,285 Engineering, selling and administrative expense 28,812 27,624 Impairment charge 2,000 — (Loss) income from operations (2,818 ) 5,661 Other income, net 1,556 3,559 (Loss) income before provision for income taxes (1,262 ) 9,220 Provision for income taxes 466 1,292 Net (loss) income $ (1,728 ) $ 7,928 STRATTEC’s share of VAST LLC net (loss) income $ (576 ) $ 2,643 Intercompany profit eliminations 11 12 STRATTEC’s equity (loss) earnings of VAST LLC $ (565 ) $ 2,655 June 28, 2020 June 30, 2019 Cash and cash equivalents $ 8,549 $ 6,854 Receivables, net 40,983 35,639 Inventories, net 22,285 20,465 Other current assets 17,674 19,701 Total current assets 89,491 82,659 Property, plant and equipment, net 63,574 49,953 Other long-term assets 14,387 16,868 Total assets $ 167,452 $ 149,480 Current debt $ 13,072 $ 7,240 Other current liabilities 72,878 63,799 Long-term debt 12,778 5,015 Other long-term liabilities 2,228 2,512 Total liabilities $ 100,956 $ 78,566 Net assets $ 66,496 $ 70,914 STRATTEC’s share of VAST LLC net assets $ 22,165 $ 23,638 Our joint venture company, SAL LLC, was dissolved during 2020. STRATTEC’s equity earnings of SAL LLC totaled $356,000 in 2020 and $128,000 in 2019. We have sales of component parts to VAST LLC, purchases of component parts from VAST LLC, expenses charged to VAST LLC for engineering and accounting services and expenses charged from VAST LLC to STRATTEC for general headquarter expenses. The following tables summarize the related party transactions with VAST LLC for the periods indicated (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Sales to VAST LLC $ 4,041 $ 3,731 Purchases from VAST LLC $ 469 $ 221 Expenses charged to VAST LLC $ 2,299 $ 1,594 Expenses charged from VAST LLC $ 935 $ 834 June 28, 2020 June 30, 2019 Accounts receivable from VAST LLC $ 1,115 $ 264 Accounts payable to VAST LLC $ 239 $ 127 |
Credit Facilities
Credit Facilities | 12 Months Ended |
Jun. 28, 2020 | |
Debt Disclosure [Abstract] | |
Credit Facilities | CREDIT FACILITIES STRATTEC has a $40 million secured revolving credit facility (the “STRATTEC Credit Facility”) with BMO Harris Bank N.A. ADAC-STRATTEC LLC has a $25 million secured revolving credit facility (the “ADAC-STRATTEC Credit Facility”) with BMO Harris Bank N.A., which is guaranteed by STRATTEC. The credit facilities both expire on August 1, 2022. Interest on borrowings under the STRATTEC Credit Facility and interest on borrowings under the ADAC-STRATTEC Credit Facility prior to December 31, 2018 were at varying rates based, at our option, on the London Interbank Offering Rate (“LIBOR”) plus 1.0 percent or the bank’s prime rate. Effective December 31, 2018, and thereafter, interest on borrowings under the ADAC-STRATTEC Credit Facility is at varying rates based, at our option, on LIBOR plus 1.25 percent or the bank’s prime rate. Both credit facilities contain a restrictive financial covenant that requires the applicable borrower to maintain a minimum net worth level. The ADAC-STRATTEC Credit Facility includes an additional restrictive financial covenant that requires the maintenance of a minimum fixed charge coverage ratio. As of June 28, 2020, we were in compliance with all financial covenants required by these credit facilities. Outstanding borrowings under the credit facilities referenced in the above paragraph as of the end of 2020 and 2019 were as follows (thousands of dollars): June 28, 2020 June 30, 2019 STRATTEC Credit Facility $ 18,000 $ 18,000 ADAC-STRATTEC Credit Facility 17,000 24,000 $ 35,000 $ 42,000 Average outstanding borrowings and the weighted average interest rate under each such credit facility during 2020 and 2019 were as follows (thousands of dollars): Average Outstanding Borrowings Weighted Average Interest Rate Years Ended Years Ended June 28, 2020 June 30, 2019 June 28, 2020 June 30, 2019 STRATTEC Credit Facility $ 13,827 $ 21,212 2.6 % 3.3 % ADAC-STRATTEC Credit Facility $ 19,121 $ 25,901 2.9 % 3.4 % We believe that the credit facilities referenced above are adequate, along with existing cash balances and cash flow from operations, to meet our anticipated capital expenditure, working capital, dividend and operating expenditure requirements. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jun. 28, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES We are from time to time subject to various legal actions and claims incidental to our business, including those arising out of alleged defects, alleged breaches of contracts, product warranties, intellectual property matters and employment related matters. It is our opinion that the outcome of such matters will not have a material adverse impact on the consolidated financial position, results of operations or cash flows of STRATTEC. With respect to warranty matters, although we cannot ensure that the future costs of warranty claims by customers will not be material, we believe our established reserves are adequate to cover potential warranty settlements. We have a reserve for estimated costs to remediate an environmental contamination site at our Milwaukee facility. The site was contaminated by a solvent spill, which occurred in 1985, from a former above ground solvent storage tank located on the east side of the facility. The reserve was initially established in 1995. Due to changing technology and related costs associated with active remediation of the site, in fiscal 2010 the reserve was adjusted based on updated third party estimates to adequately cover the cost for active remediation of the contamination. Additionally, in fiscal 2016, STRATTEC obtained updated third party estimates for adequately covering the cost of active remediation of this contamination. Based upon the updated estimates, no further adjustment to the reserve was required. From 1995 through June 28, 2020, costs of approximately $ 616,000 have been incurred related to the installation of monitoring wells on the property and ongoing monitoring costs. We monitor and evaluate the site with the use of groundwater monitoring wells that are installed on the property. An environmental consultant samples these wells one or two times a year to determine the status of the contamination and the potential for remediation of the contamination by natural attenuation, the dissipation of the contamination over time to concentrations below applicable standards. If such sampling evidences a sufficient degree of and trend toward natural attenuation of the contamination, we may be able to obtain a closure letter from the regulatory authorities resolving the issue without the need for active remediation. If a sufficient degree and trend toward natural attenuation is not evidenced by sampling, a more active form of remediation beyond natural attenuation may be required. The sampling has not yet satisfied all of the requirements for closure by natural attenuation. As a result, sampling continues and the reserve remains at an amount to reflect the estimated cost of active remediation. The reserve is not measured on a discounted basis. We believe, based on findings-to-date and known environmental regulations, that the environmental reserve of $ 1.3 million at June 28, 2020, is adequate. At June 28, 2020, we had purchase commitments related to zinc, other purchased parts and natural gas. We also had minimum rental commitments under non-cancelable operating leases with a term in excess of one year. The purchase and minimum rental commitments are payable as follows (thousands of dollars): Purchase Minimum Rental Fiscal Year Commitments Commitments 2021 $ 9,545 $ 473 2022 $ 4,183 $ 484 2023 $ — $ 497 2024 $ — $ 509 2025-2026 $ — $ 2,356 |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 28, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The provision for income taxes consisted of the following (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Currently (recoverable) payable: Federal $ (1,869 ) $ 705 State (176 ) 162 Foreign 3,368 1,515 1,323 2,382 Deferred tax provision (3,589 ) (10,122 ) $ (2,266 ) $ (7,740 ) The items accounting for the difference between income taxes computed at the Federal statutory tax rate and the provision for income taxes were as follows: Years Ended June 28, 2020 June 30, 2019 U.S. statutory rate 21.0 % 21.0 % State taxes, net of Federal tax benefit 2.1 3.7 Foreign subsidiaries (5.8 ) (1.8 ) U.S. tax reform: transition tax — 2.7 Federal net operating loss carry-back statutory rate differential 11.7 — Global intangible low-taxed income (4.4 ) (0.7 ) Research and development tax credit 9.9 9.4 Non-controlling interest (2.3 ) 6.7 Uncertain tax positions (4.0 ) (2.3 ) Stock based compensation (1.8 ) (0.7 ) Other 1.5 (0.1 ) 27.9 % 37.9 % On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act ("the CARES Act") was enacted. The CARES Act contains several income tax provisions, as well as other measures, that are intended to assist businesses impacted by the economic effects of the COVID-19 pandemic. The CARES Act includes a five-year carryback allowance for taxable net operating losses generated in tax years 2018 through 2020, our fiscal years 2019 through 2021. We recorded an expected benefit for the carryback of our fiscal year 2020 federal net operating loss. As we are carrying the losses back to years beginning before January 1, 2018, the tax benefit is a result of the rate differential between the previous 35% federal tax rate and current statutory rate of 21%. The components of deferred tax (liabilities) assets were as follows (thousands of dollars): June 28, 2020 June 30, 2019 Unrecognized pension and postretirement plan liabilities $ 617 $ 701 Accrued warranty 517 446 Payroll-related accruals 2,259 2,180 Stock-based compensation 389 470 Inventory reserve 964 834 Environmental reserve 296 300 Repair and maintenance supply parts reserve 510 229 Allowance for doubtful accounts 118 118 Lease liability 882 — Right of use assets (882 ) — Credit carry-forwards 3,860 1,990 Postretirement obligations (357 ) (416 ) Accumulated depreciation (5,063 ) (5,023 ) Accrued pension obligations 472 (1,578 ) Non-cash compensation expense — 986 Joint ventures 1,167 968 Other 741 728 $ 6,490 $ 2,933 Deferred income tax balances reflect the effects of temporary differences between the carrying amounts of assets and liabilities and their tax basis and are stated at enacted tax rates expected to be in effect when taxes are actually paid or recovered. Federal credit carry-forwards at June 28, 2020 resulted in future benefits of approximately $3.5 million and expire between 2033 and 2035. We currently anticipate having sufficient Federal taxable income to offset these credit carry-forwards. State credit carry-forwards at June 28, 2020 resulted in future benefits of approximately $318,000 and expire at varying times between 2025 and 2035. A valuation allowance of $189,000 has been recorded as of June 28, 2020, due to our assessment of the future realization of certain credit carry-forward benefits. We do not currently anticipate having sufficient state taxable income to offset these credit carry-forwards. Foreign income before the provision for income taxes was $7.7 million in 2020 and $4.0 million in 2019. The total liability for unrecognized tax benefits was $1.6 million as of June 28, 2020 and $1.2 million as of June 30, 2019 and was included in Other Long-term Liabilities in the accompanying Consolidated Balance Sheets. This liability includes approximately $1.5 million of unrecognized tax benefits at June 28, 2020 and $1.1 million at June 30, 2019 and approximately $147,000 of accrued interest at June 28, 2020 and $93,000 at June 30, 2019. This liability does not include an amount for accrued penalties. The amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate was approximately $1.1 million at June 28, 2020 and $854,000 at June 30, 2019. We recognize interest and penalties related to unrecognized tax benefits in the provision for income taxes. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows for the years ended June 28, 2020 and June 30, 2019 (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Unrecognized tax benefits, beginning of year $ 1,138 $ 741 Gross increases – tax positions in prior years 140 229 Gross increases – current period tax positions 245 238 Tax years closed (61 ) (70 ) Unrecognized tax benefits, end of year $ 1,462 $ 1,138 We or one of our subsidiaries files income tax returns in the United States (Federal), Wisconsin (state), Michigan (state) and various other states, Mexico and other foreign jurisdictions. We are currently subject to a Wisconsin income tax examination for fiscal 2015 through 2018. Tax years open to examination by tax authorities under the statute of limitations include fiscal 2017 through 2020 for Federal, fiscal 2016 through 2020 for most states and calendar 2015 through 2019 for foreign jurisdictions. |
Retirement Plans and Postretire
Retirement Plans and Postretirement Costs | 12 Months Ended |
Jun. 28, 2020 | |
Compensation And Retirement Disclosure [Abstract] | |
Retirement Plans and Postretirement Costs | RETIREMENT PLANS AND POSTRETIREMENT COSTS We had a qualified, noncontributory defined benefit pension plan (“Qualified Pension Plan”) covering substantially all U.S. associates employed by us prior to January 1, 2010. Effective December 31, 2009, the Board of Directors amended the Qualified Pension Plan to freeze benefit accruals and future eligibility. The Board of Directors has subsequently approved to proceed with the termination of the Qualified Pension Plan. During the quarter ended December 30, 2018, we completed a substantial portion of terminating the Qualified Pension Plan. In connection with the termination of the Qualified Pension Plan, distributions from the Qualified Pension Plan trust were made during the three month period ended December 30, 2018 to participants who elected lump-sum distributions. Additionally, during the three months ended December 30, 2018, we entered into an agreement with an insurance company to purchase from us, through a series of annuity contracts, our remaining obligations under the Qualified Pension Plan and, as a result, we settled the remaining obligations under the plan for the remaining participants utilizing funds available in the Qualified Pension Plan trust. No additional cash contributions to the trust were required to settle the pension obligations. As a result of these actions, a non-cash pre-tax settlement charge of $31.9 million was recorded during fiscal 2019. A non-cash compensation expense charge of $4.2 million was also recorded during fiscal 2019 related to the future transfer of the excess assets in the Qualified Pension Plan to a STRATTEC defined contribution plan for subsequent pay-out to eligible STRATTEC employees based on a plan approved by the Board of Directors in June 2019. An additional $4.8 million non-cash compensation expense charge related to the final transfer and pay-out of the excess Qualified Pension Plan assets was recorded during our fiscal 2020. During fiscal 2020, the excess Qualified Pension Plan assets were transferred to our defined contribution plan and distributed to eligible STRATTEC employees, which completed the full termination of the Qualified Pension Plan. We have a noncontributory supplemental executive retirement plan (“SERP”), which is a nonqualified defined benefit plan. The SERP is funded through a Rabbi Trust with TMI Trust Company. Under the SERP, as amended December 31, 2013, participants received an accrued lump-sum benefit as of December 31, 2013 which was credited to each participant’s account. Subsequent to December 31, 2013, each eligible participant receives a supplemental retirement benefit equal to the foregoing lump-sum benefit, plus an annual benefit accrual equal to 8 percent of the participant’s base salary and cash bonus, plus annual credited interest on the participant’s account balance. All then current participants as of December 31, 2013 are fully vested in their account balances with any new individuals participating in the SERP effective on or after January 1, 2014 being subject to a five year vesting period. The SERP, which is considered a defined benefit plan under applicable rules and regulations of the Internal Revenue Code, will continue to be funded through use of a Rabbi Trust to hold investment assets to be used in part to fund any future required lump sum benefit payments to participants. The Rabbi Trust assets had a value of $2.9 million at both June 28, 2020 and June 30, 2019. At June 28, 2020, $217,000 of the Rabbi Trust asset balance was included in Other Current Assets and $2.7 million of the Rabbi Trust balance was included in Other Long-Term Assets in the accompanying Consolidated Balance Sheets. At June 30, 2019, the Rabbi Trust asset balance was included in Other Long-Term Assets in the accompanying Consolidated Balance Sheets. The projected benefit obligation under the SERP was $2.3 million at June 28, 2020 and $2.2 million at June 30, 2019. The SERP liabilities are included in the pension tables below. However, the Rabbi Trust assets are excluded from the tables as they do not qualify as plan assets. We also sponsor a postretirement health care plan for all U.S. associates hired prior to June 1, 2001. The expected cost of retiree health care benefits is recognized during the years the associates who are covered under the plan render service. Effective January 1, 2010, an amendment to the postretirement health care plan limited the benefit for future eligible retirees to $4,000 per plan year and the benefit is further subject to a maximum five year coverage period based on the associate’s retirement date and age. The postretirement health care plan is unfunded. Amounts included in accumulated other comprehensive loss, net of tax, at June 28, 2020, which have not yet been recognized in net periodic benefit cost were as follows (thousands of dollars): SERP Postretirement Prior service credit $ — $ (6 ) Net actuarial loss 215 1,768 $ 215 $ 1,762 Prior service cost (credit) and unrecognized net actuarial losses included in accumulated other comprehensive loss at June 28, 2020 which are expected to be recognized in net periodic benefit cost (credit) in fiscal 2021, net of tax, for the pension, SERP and postretirement plans are as follows (thousands of dollars): SERP Postretirement Prior service credit $ — $ (6 ) Net actuarial loss 8 274 $ 8 $ 268 The following tables summarize the pension, SERP and postretirement plans’ income and expense, funded status and actuarial assumptions for the years indicated (thousands of dollars). We use a June 30 measurement date for our pension and postretirement plans. Pension and SERP Benefits Postretirement Benefits Years Ended Years Ended June 28, 2020 June 30, 2019 June 28, 2020 June 30, 2019 COMPONENTS OF NET PERIODIC BENEFIT COST: Service cost $ 74 $ 62 $ 12 $ 11 Interest cost 61 2,101 26 40 Expected return on plan assets — (2,275 ) — — Plan settlements — 31,878 — — Amortization of prior service cost (credit) — — (29 ) (439 ) Amortization of unrecognized net loss 15 831 397 431 Net periodic benefit cost (credit) $ 150 $ 32,597 $ 406 $ 43 WEIGHTED-AVERAGE ASSUMPTIONS: Benefit Obligations: Discount rate 2.33 % 3.17 % 2.07 % 3.01 % Rate of compensation increases – SERP 3.0 % 3.0 % n/a n/a Net Periodic Benefit Cost: Discount rate 3.17 % 4.30 % 3.01 % 4.30 % Rate of compensation increases – SERP 3.0 % 3.0 % n/a n/a CHANGE IN PROJECTED BENEFIT OBLIGATION: Benefit obligation at beginning of year $ 2,229 $ 98,835 $ 914 $ 1,041 Service cost 74 62 12 11 Interest cost 61 2,101 26 40 Plan settlements — (72,400 ) — — Actuarial gain 3 5,143 22 39 Benefits paid (74 ) (31,512 ) (153 ) (217 ) Benefit obligation at end of year $ 2,293 $ 2,229 $ 821 $ 914 CHANGE IN PLAN ASSETS: Fair value of plan assets at beginning of year $ 8,645 $ 111,466 $ — $ — Actual return on plan assets 84 1,077 — — Employer contribution 14 14 153 217 Excess Asset Transfer (9,019 ) — — — Plan settlements 350 (72,400 ) — — Benefits paid (74 ) (31,512 ) (153 ) (217 ) Fair value of plan assets at end of year $ - $ 8,645 $ — $ — Funded status – (accrued) prepaid benefit obligations $ (2,293 ) $ 6,416 $ (821 ) $ (914 ) AMOUNTS RECOGNIZED IN CONSOLIDATED BALANCE SHEETS: Other long-term assets $ — $ 8,585 $ — $ — Accrued payroll and benefits (current liabilities) (1,039 ) (506 ) (120 ) (152 ) Accrued benefit obligations (long-term liabilities) (1,254 ) (1,663 ) (701 ) (762 ) Net amount recognized $ (2,293 ) $ 6,416 $ (821 ) $ (914 ) CHANGES IN PLAN ASSETS AND BENEFIT OBLIGATIONS RECOGNIZED IN OTHER COMPREHENSIVE INCOME: Net periodic benefit cost $ 150 $ 32,597 $ 406 $ 43 Net actuarial loss (gain) 3 (57,414 ) 22 39 Plan settlements — 31,878 — — Amortization of prior service credits — — 29 439 Amortization of unrecognized net loss (15 ) (831 ) (397 ) (431 ) Total recognized in other comprehensive (income) loss, before tax (12 ) (26,367 ) (346 ) 47 Total recognized in net periodic benefit cost and other comprehensive loss, before tax $ 138 $ 6,230 $ 60 $ 90 The pension benefits have a separately determined accumulated benefit obligation, which is the actuarial present value of benefits based on service rendered and current and past compensation levels. This differs from the projected benefit obligation in that it includes no assumptions about future compensation levels. The following table summarizes the accumulated benefit obligations and projected benefit obligations for the pension and SERP (thousands of dollars): Pension SERP June 28, 2020 June 30, 2019 June 28, 2020 June 30, 2019 Accumulated benefit obligation $ — $ 60 $ 2,176 $ 1,981 Projected benefit obligation $ — $ 60 $ 2,293 $ 2,169 As of June 30, 2019, the qualified pension plan weighted-average asset allocation was 100 percent to cash and cash equivalents, which asset value totaled $8.6 million and was considered a Level 2 investment. Due to the full termination of the qualified pension plan as discussed above, the plan held no assets at June 28, 2020. For measurement purposes as it pertains to the estimated obligation associated with retirees prior to January 1, 2010, a 6.71 percent annual rate increase in the per capita cost of covered health care benefits was assumed for fiscal 2021; the rate was assumed to decrease gradually to 3.0 percent by the year 2029 and remain at that level thereafter. The health care cost trend assumption has a minimal effect on our postretirement benefit amounts reported. A 1% change in the health care cost trend rates would have the following effects (thousands of dollars): 1% Increase 1% Decrease Effect on total of service and interest cost components in fiscal 2020 $ — $ — Effect on postretirement benefit obligation as of June 30, 2020 $ 3 $ (3 ) We expect to contribute $1.0 million to our SERP and $119,000 to our postretirement health care plan in fiscal 2021. The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid during the fiscal years noted below (thousands of dollars): SERP Benefits Postretirement Benefits 2021 $ 1,040 $ 119 2022 $ 402 $ 116 2023 $ 14 $ 103 2024 $ 14 $ 93 2025 $ 14 $ 64 2026-2030 $ 928 $ 218 All U.S. associates may participate in our 401(k) Plan. We contribute 100 percent up to the first 5 percent of eligible compensation that a participant contributes to the plan. Our contributions to the 401(k) Plan were as follows (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Company contributions $ 1,709 $ 1,903 |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Jun. 28, 2020 | |
Equity [Abstract] | |
Shareholders' Equity | SHAREHOLDERS’ EQUITY We have 12,000,000 shares of authorized common stock, par value $.01 per share, with 3,749,619 and 3,691,555 shares outstanding at June 28, 2020 and June 30, 2019, respectively. Holders of our common stock are entitled to one vote for each share on all matters voted on by shareholders. Our Board of Directors authorized a stock repurchase program to buy back up to 3,839,395 outstanding shares of our common stock as of June 28, 2020. As of June 28, 2020, 3,655,322 shares have been repurchased under this program at a cost of approximately $136.4 million. No shares were repurchased under this program during 2020 or 2019. |
Loss Per Share
Loss Per Share | 12 Months Ended |
Jun. 28, 2020 | |
Earnings Per Share [Abstract] | |
Loss Per Share | LOSS PER SHARE Basic loss per share is computed on the basis of the weighted average number of shares of common stock outstanding during the applicable period. Diluted loss per share is computed on the basis of the weighted average number of shares of common stock plus the potential dilutive common shares outstanding during the applicable period using the treasury stock method. Potential dilutive common shares include outstanding stock options and unvested restricted stock awards. A reconciliation of the components of the basic and diluted per share computations follows (in thousands, except per share amounts): Years Ended June 28, 2020 June 30, 2019 Net loss attributable to STRATTEC $ (7,605 ) $ (17,029 ) Weighted average shares of common stock outstanding 3,737 3,676 Incremental shares – stock based compensation — — Diluted weighted average shares of common stock Outstanding 3,737 3,676 Basic loss per share $ (2.04 ) $ (4.63 ) Diluted loss per share $ (2.04 ) $ (4.63 ) Potentially dilutive common shares that were excluded from the calculation of diluted earnings per share because their inclusion would have been antidilutive were as follows: Years Ended Number Excluded June 28, 2020 160,254 June 30, 2019 181,117 |
Stock Option and Purchase Plans
Stock Option and Purchase Plans | 12 Months Ended |
Jun. 28, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock Option and Purchase Plans | STOCK OPTION AND PURCHASE PLANS A summary of stock option activity under our stock incentive plan was as follows: Weighted Average Weighted Average Remaining Contractual Aggregate Intrinsic Value Shares Exercise Price Term (in years) (in thousands) Balance at July 1, 2018 133,074 $ 29.37 Exercised (15,714 ) $ 10.92 Balance at June 30, 2019 117,360 $ 31.85 Exercised (26,500 ) $ 18.00 Balance at June 28, 2020 90,860 $ 35.88 2.4 $ — Exercisable as of: June 28, 2020 90,860 $ 35.88 2.4 $ — June 30, 2019 117,360 $ 31.85 2.7 $ 162 No options were granted during fiscal 2020 or 2019. A summary of restricted stock activity under our stock incentive plan was as follows: Weighted Average Grant Date Shares Fair Value Nonvested Balance at July 1, 2018 69,125 $ 49.02 Granted 34,050 $ 37.25 Vested (37,343 ) $ 54.93 Forfeited (2,075 ) $ 43.52 Nonvested Balance at June 30, 2019 63,757 $ 39.47 Granted 39,150 $ 21.80 Vested (27,318 ) $ 37.86 Forfeited (6,195 ) $ 34.38 Nonvested Balance at June 28, 2020 69,394 $ 30.59 We have an Employee Stock Purchase Plan to provide substantially all U.S. full-time associates an opportunity to purchase shares of STRATTEC common stock through payroll deductions. A participant may contribute a maximum of $5,200 per calendar year to the plan. On the last day of each month or if such date is not a trading day on the most recent previous trading day, participant account balances are used to purchase shares of our common stock at the average of the highest and lowest reported sales prices of a share of STRATTEC common stock on the NASDAQ Global Market on such date. A total of 100,000 shares may be issued under the plan. Shares issued from treasury stock under the plan totaled 4,246 at an average price of $19.42 during 2020 and 3,295 at an average price of $30.13 during 2019. A total of 53,871 shares remain available for purchase under the plan as of June 28, 2020. |
Export Sales
Export Sales | 12 Months Ended |
Jun. 28, 2020 | |
Segment Reporting [Abstract] | |
Export Sales | EXPORT SALES Total export sales, sales from the United States to locations outside of the United States, are summarized as follows (thousands of dollars and percent of total net sales): Years Ended June 28, 2020 June 30, 2019 Net Sales % Net Sales % Export sales $ 114,381 30% $ 160,771 33% Countries for which customer sales account for ten percent or more of total net sales are summarized as follows (thousands of dollars and percent of total net sales): Years Ended June 28, 2020 June 30, 2019 Net Sales % Net Sales % Export sales into Canada $ 46,191 12% $ 67,516 14% |
Product Sales
Product Sales | 12 Months Ended |
Jun. 28, 2020 | |
Segment Reporting [Abstract] | |
Product Sales | PRODUCT SALES Sales by product group were as follows (thousands of dollars and percent of total net sales): Years Ended June 28, 2020 June 30, 2019 Net Sales % Net Sales % Keys & locksets $ 101,666 26 % $ 135,413 28 % Door handles & exterior trim 98,168 25 116,977 24 Power access 63,829 17 92,744 19 Latches 45,295 12 49,147 10 Aftermarket & OE service 40,742 11 44,254 9 Driver controls 29,649 8 40,942 8 Other 5,951 1 7,529 2 $ 385,300 100 % $ 487,006 100 % |
Sales and Receivable Concentrat
Sales and Receivable Concentration | 12 Months Ended |
Jun. 28, 2020 | |
Segment Reporting Information Receivable [Abstract] | |
Sales and Receivable Concentration | SALES AND RECEIVABLE CONCENTRATION Sales to our largest customers were as follows (thousands of dollars and percent of total net sales): Years Ended June 28, 2020 June 30, 2019 Net Sales % Net Sales % General Motors Company $ 102,487 27 % $ 112,719 23 % Fiat Chrysler Automobiles 85,010 22 115,304 24 Ford Motor Company 52,666 13 63,333 13 $ 240,163 62 % $ 291,356 60 % Receivables from our largest customers were as follows (thousands of dollars and percent of gross receivables): June 28, 2020 June 30, 2019 Receivables % Receivables % General Motors Company $ 12,630 30 % $ 12,754 15 % Fiat Chrysler Automobiles 5,881 14 19,151 23 Ford Motor Company 6,101 15 9,991 12 $ 24,612 59 % $ 41,896 50 % |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (unaudited) | 12 Months Ended |
Jun. 28, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Financial Data (unaudited) | Selected Quarterly Financial Data (unaudited) The following data are in thousands of dollars except per share amounts. Net Income (Loss) Attributable to Earnings (Loss) per Share Quarter Net Sales Gross Profit STRATTEC Basic Diluted 2020 First $ 119,962 $ 15,886 $ 1,244 $ 0.34 $ 0.33 Second 106,283 10,333 (1,341 ) (0.36 ) (0.36 ) Third 116,938 17,010 2,994 0.80 0.79 Fourth 42,117 (7,783 ) (10,502 ) (2.80 ) (2.80 ) TOTAL $ 385,300 $ 35,446 $ (7,605 ) $ (2.04 ) $ (2.04 ) 2019 First $ 117,159 $ 15,183 $ 3,467 $ 0.95 $ 0.93 Second 112,913 12,736 (22,164 ) (6.03 ) (5.96 ) Third 128,230 15,682 1,730 0.47 0.46 Fourth 128,704 14,199 (62 ) (0.02 ) (0.02 ) TOTAL $ 487,006 $ 57,800 $ (17,029 ) $ (4.63 ) $ (4.63 ) |
Organization and Summary of S_2
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jun. 28, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Risks and Uncertainties | Risks and Uncertainties: In December 2019, a novel strain of coronavirus (COVID-19) was reported in Wuhan, China. The coronavirus has since spread, and infections have been found in multiple countries around the world, including the United States. In March 2020, the World Health Organization recognized the COVID-19 outbreak as a pandemic based on the global spread of the disease, the severity of illnesses it causes and its effects on society. In response to the COVID-19 outbreak, the governments of many countries, states, cities and other geographic regions have taken preventative or protective actions, such as imposing restrictions on travel and business operations and advising or requiring individuals to limit or forego their time outside of their homes. Accordingly, the COVID-19 outbreak has severely restricted the level of economic activity in many countries, and continues to adversely impact global economic activity. STRATTEC’s operating performance is subject to global economic conditions and levels of consumer spending specifically within the automotive industry. During fiscal 2020, the impact of the COVID-19 outbreak reduced our sales by approximately $78 million, which negatively impacted our operating results. The extent of the impact of the COVID-19 outbreak on our future operating results will depend on certain developments, including the duration, intensity and continued spread of the outbreak, regulatory and private sector responses, which may be precautionary, and the impact to our customers, workforce and suppliers, all of which are uncertain and cannot be predicted. These changing conditions may also affect the estimates and assumptions made by management. Such estimates and assumptions affect, among other things, our long-lived asset valuations, equity investment valuation, assessment of our annual effective tax rate, valuation of deferred income taxes, assessment of excess and obsolete inventory reserves, and assessment of collectability of trade receivables. Events and changes in circumstances arising after June 28, 2020, including those resulting from the impacts of COVID-19, will be in management’s estimates for future periods. During the period late March 2020 through mid-June 2020, the majority of our OEM customer assembly plant operations were completely closed including the majority of the supply chain. Additionally, during this same period, STRATTEC’s Mexico facilities were closed as a result of the Mexican government’s shutdown of non-essential businesses. Re-opening of our OEM customer facilities and our Mexico facilities began in June 2020. As of June 28, 2020, our Mexican facilities were open with 50 percent of the workforce allowed to return. Based on information available, our current estimates indicate the continued ramp-up of the automotive industry resulting in an increase in our net sales for the upcoming fiscal year compared to our fiscal 2020. Such estimates are dependent on the severity of the impacts of COVID-19 and any worsening of the impact of the pandemic on society. We anticipate our fourth fiscal quarter of 2020 was the worst or trough quarter and that thereafter the automotive industry will continue to ramp back-up production during our fiscal 2021. We expect the impact on our overall cash liquidity will be most significant at the beginning of our fiscal year 2021 with a reduction in payments from customers resulting from lower fourth quarter fiscal 2020 net sales as previously discussed. We expect that this lower cash liquidity will cause us to utilize our credit facilities to fund our increased working capital requirements in fiscal 2021. |
Significant Accounting Policies | Significant Accounting Policies: The significant accounting policies followed in the preparation of these financial statements, as summarized in the following paragraphs, are in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP). |
Principles of Consolidation and Presentation | Principles of Consolidation and Presentation: The accompanying consolidated financial statements include the accounts of STRATTEC SECURITY CORPORATION, its wholly owned Mexican subsidiary and its majority owned subsidiaries. Equity investments for which STRATTEC exercises significant influence but does not control and is not the primary beneficiary are accounted for using the equity method. All significant inter-company transactions and balances have been eliminated. |
New Accounting Standards | New Accounting Standards: In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses . The update revises the methodology for measuring credit losses on financial instruments and the timing of when such losses are recorded. Originally, the update was effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted. In November 2019, FASB issued ASU 2019-10, Financial Instruments – Credit Losses, Derivatives and Hedging, and Leases . This ASU defers the effective date of ASU 2016-13 for public companies that are considered smaller reporting companies as defined by the SEC to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. We are planning to adopt this standard in the first quarter of our fiscal 2024.We are currently evaluating the potential effects of adopting the new guidance on our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation In December 2019, the FASB issued ASU 2019-12, Income Taxes In March 2020, the FASB issued ASU 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which |
Fiscal Year | Fiscal Year: Our fiscal year ends on the Sunday nearest June 30. The years ended June 28, 2020 and June 30, 2019 are each comprised of 52 weeks |
Use of Estimates | Use of Estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses for the periods presented. These estimates and assumptions could also affect the disclosure of contingencies. Actual results and outcomes may differ from management’s estimates and assumptions. |
Cash and Cash Equivalents | Cash and Cash Equivalents: Cash and cash equivalents include all short-term investments with an original maturity of three months or less due to the short-term nature of the instruments. Excess cash balances are placed in short-term commercial paper. |
Derivatives Instruments | Derivative Instruments: We own and operate manufacturing operations in Mexico. As a result, a portion of our manufacturing costs are incurred in Mexican pesos, which causes our earnings and cash flows to fluctuate due to changes in the U.S. dollar/Mexican peso exchange rate. We have contracts with Bank of Montreal that provide for monthly Mexican peso currency forward contracts for a portion of our estimated peso denominated operating costs. Our objective in entering into currency forward contracts is to minimize our earnings volatility resulting from changes in exchange rates affecting the U.S. dollar cost of our Mexican operations. The Mexican peso forward contracts are not used for speculative purposes and are not designated as hedges. As a result, all currency forward contracts are recognized in our accompanying condensed consolidated financial statements at fair value and changes in the fair value are reported in current earnings as part of Other Income (Expense), net. The following table quantifies the outstanding Mexican peso forward contracts as of June 28, 2020 (thousands of dollars, except with respect to the average forward contractual exchange rate): Effective Dates Notional Amount Average Forward Contractual Exchange Rate Fair Value Buy MXP/Sell USD July 15, 2020 - December 16, 2020 $ 6,000 21.40 $ (480 ) The fair market value of all outstanding Mexican peso forward contracts in the accompanying Consolidated Balance Sheets was as follows (thousands of dollars): June 28, 2020 June 30, 2019 Not designated as hedging instruments: Other current liabilities: Mexican peso forward contracts $ 480 $ — The pre-tax effects of the Mexican peso forward contracts on the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income consisted of the following (thousands of dollars): Other Income, net Years Ended June 28, 2020 June 30, 2019 Not Designated as Hedging Instruments: Realized (loss) gain $ (418 ) $ 485 Unrealized (loss) gain $ (480 ) $ 39 |
Fair Value of Financial Instruments | Fair Value of Financial Instruments: The fair value of our cash and cash equivalents, accounts receivable, accounts payable and borrowings under our credit facilities approximated their book value as of June 28, 2020 and June 30, 2019. Fair value is defined as the exchange price that would be received for an asset or paid for a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. There is an established fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable. Level 1 – Quoted prices in active markets for identical assets or liabilities. These are typically obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 – Inputs, other than quoted prices included within Level 1, which are observable for the asset or liability, either directly or indirectly. These are typically obtained from readily-available pricing sources for comparable instruments. Level 3 – Unobservable inputs, where there is little or no market activity for the asset or liability. These inputs reflect the reporting entity’s own assumptions of the data that market participants would use in pricing the asset or liability, based on the best information available in the circumstances. The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of June 28, 2020 and June 30, 2019 (thousands of dollars): June 28, 2020 June 30, 2019 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Rabbi Trust assets: Stock index funds: Small cap $ 251 $ — $ — $ 251 $ 276 $ — $ — $ 276 Mid cap 284 — — 284 293 — — 293 Large cap 563 — — 563 589 — — 589 International 820 — — 820 864 — — 864 Fixed income funds 793 — — 793 913 — — 913 Cash and cash equivalents — 224 — 224 — 3 — 3 Total assets at fair value $ 2,711 $ 224 $ — $ 2,935 $ 2,935 $ 3 $ — $ 2,938 Liabilities: Mexican peso forward contracts $ — $ 480 $ — $ — $ — $ — $ — $ — The Rabbi Trust assets fund our supplemental executive retirement plan and are primarily included in Other Long-Term Assets in the accompanying Consolidated Balance Sheets. Refer to discussion of Mexican peso forward contracts under Derivative Instruments above. The fair value of the Mexican peso forward contracts considers the remaining term, current exchange rate and interest rate differentials between the two currencies. |
Receivables | Receivables: Receivables consist primarily of trade receivables due from Original Equipment Manufacturers in the automotive industry and locksmith/dealership distributors relating to our service and aftermarket sales. We evaluate the collectability of receivables based on a number of factors. An allowance for doubtful accounts is recorded for significant past due receivable balances based on a review of the past due items, general economic conditions (including with respect to the impact of COVID-19 on our customers) and the industry as a whole. The allowance for doubtful accounts totaled $500,000 at June 28, 2020 and June 30, 2019. |
Inventories | Inventories: Inventories are comprised of material, direct labor and manufacturing overhead, and are stated at net realizable value using the first-in, first-out (“FIFO”) cost method of accounting. Inventories consisted of the following (thousands of dollars): June 28, 2020 June 30, 2019 Finished products $ 13,142 $ 11,582 Work in process 11,815 10,529 Purchased materials 34,333 29,376 59,290 51,487 Excess and obsolete reserve (4,890 ) (4,225 ) Inventories, net $ 54,400 $ 47,262 We record a reserve for excess and obsolete inventory based on historical and estimated future demand and market conditions. The reserve level is determined by comparing inventory levels of individual materials and parts to historical usage and estimated future sales by analyzing the age of the inventory in order to identify specific materials and parts that are unlikely to be sold. Technical obsolescence and other known factors are also considered in evaluating the reserve level. The activity related to the excess and obsolete inventory reserve was as follows (thousands of dollars): Balance, Beginning of Year Provision Charged to Expense Amounts Written Off Balance, End of Year Year ended June 28, 2020 $ 4,225 $ 2,178 $ 1,513 $ 4,890 Year ended June 30, 2019 $ 4,000 $ 799 $ 574 $ 4,225 |
Customer Tooling in Progress | Customer Tooling in Progress: We incur costs related to tooling used in component production and assembly. Costs for development of certain tooling, which will be directly reimbursed by the customer whose parts are produced from the tool, are accumulated on the balance sheet and are then billed to the customer. The accumulated costs are billed upon formal acceptance by the customer of products produced with the individual tool. Other tooling costs are not directly reimbursed by the customer. We capitalize and amortize these other tooling costs over the life of the related product based on the fact that the related tool will be used over the life of the supply arrangement. To the extent that estimated costs exceed expected reimbursement from the customer we recognize a loss. |
Property, Plant and Equipment | Property, Plant and Equipment: Property, plant and equipment are stated at cost. Property, plant and equipment are depreciated on a straight-line basis over the estimated useful lives of the assets as follows: Classification Expected Useful Lives Land improvements 20 years Buildings and improvements 15 to 35 years Machinery and equipment 3 to 15 years Property, plant and equipment consisted of the following (thousands of dollars): June 28, 2020 June 30, 2019 Land and improvements $ 5,002 $ 5,679 Buildings and improvements 33,179 35,742 Machinery and equipment 228,035 246,000 266,216 287,421 Less: accumulated depreciation (161,068 ) (169,301 ) $ 105,148 $ 118,120 Depreciation expense was as follows for the periods indicated (thousands of dollars): Fiscal Year Depreciation Expense 2020 $ 19,329 2019 $ 17,159 The gross and net book value of property, plant and equipment located outside of the United States, primarily in Mexico, were as follows (thousands of dollars): June 28, 2020 June 30, 2019 Gross book value $ 146,690 $ 157,551 Net book value $ 71,369 $ 80,922 Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such indicators are present, the recoverability of assets to be held and used is assessed by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the asset. If an asset is determined to not be recoverable, the impairment recognized is calculated as the excess of the carrying amount of the asset over the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less estimated costs to sell. There were no impairments recorded in the years ended June 28, 2020 or June 30, 2019. Expenditures for repairs and maintenance are charged to expense as incurred. Expenditures for major renewals and betterments, which significantly extend the useful lives of existing plant and equipment, are capitalized and depreciated. Upon retirement or disposition of plant and equipment, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in income. |
Leases | Leases: Our right-of-use operating lease assets are recorded at the present value of future minimum lease payments, net of amortization. We have an operating lease for our El Paso, Texas finished goods and service parts distribution warehouse that has a current lease term through October 2023. This lease includes renewal terms that can extend the lease term for five additional years. For purposes of calculating operating lease obligations, we included the option to extend the lease as it is reasonably certain that we will exercise such option. The lease does not contain material residual value guarantees or restrictive covenants. Operating lease expense is recognized on a straight-line basis over the lease term. As the lease does not provide an implicit rate, we used our incremental borrowing rate at lease commencement to determine the present value of our lease payments. The incremental borrowing rate is an entity-specific rate which represents the rate of interest we would pay to borrow over a similar term with similar payments. The operating lease asset and obligation related to our El Paso warehouse lease included in the accompanying Condensed Consolidated Balance Sheet are presented below (thousands of dollars): June 28, 2020 Right-of-Use Asset Under Operating Lease: Other Long-Term Assets $ 3,753 Lease Obligation Under Operating Lease: Current Liabilities: Accrued Liabilities: Other $ 354 Other Long-Term Liabilities 3,399 $ 3,753 Future minimum lease payments, by our fiscal year, including options to extend that are reasonably certain to be exercised, under the non-cancelable lease are as follows as of June 28, 2020 (thousands of dollars): 2021 $ 473 2022 484 2023 497 2024 509 Thereafter 2,356 Total Future Minimum Lease Payments 4,319 Less: Imputed Interest (566 ) Total Lease Obligations $ 3,753 Future minimum lease payments, by our fiscal year, excluding options to extend that are reasonably certain to be exercised, prior to the adoption of the new accounting guidance on leases were as follows as of June 30, 2019 (thousands of dollars): 2020 $ 539 2021 504 2022 495 2023 498 2024 168 Thereafter — Total Future Minimum Lease Payments $ 2,204 Cash flow information related to the operating lease is shown below (thousands of dollars): Year Ended June 28, 2020 Operating Cash Flows: Cash Paid Related to Operating Lease Obligation $ 461 Non-Cash Activity: Right-of-Use Asset Obtained in Exchange for Operating Lease Obligation $ — The weighted average lease term and discount rate for the El Paso, Texas operating lease are shown below: June 28, 2020 Weighted Average Remaining Lease Term (in years) 8.3 Weighted Average Discount Rate 3.3 % Operating lease expense for the year ended June 28, 2020 totaled $461,000. Rental expense for the year ended June 30, 2019 totaled $773,000. |
Supplier Concentrations | Supplier Concentrations: The following inventory purchases were made from major suppliers during each fiscal year noted Fiscal Year Percentage of Inventory Purchases Number of Suppliers 2020 39 % 7 2019 39 % 7 We have long-term contracts or arrangements with most of our suppliers to guarantee the availability of raw materials and component parts. |
Labor Concentrations | Labor Concentrations: We had approximately 3,831 full-time associates of which approximately 200 or 5.2 percent were represented by a labor union at June 28, 2020. The associates represented by a labor union account for all production associates at our Milwaukee facility. The current contract with the unionized associates is effective through September 17, 2021. |
Revenue Recognition | Revenue Recognition: We generate revenue from the production of parts sold to automotive and light-truck Original Equipment Manufacturers (“OEMs”), or Tier 1 suppliers at the direction of the OEM, under long-term supply agreements supporting new vehicle production. Such agreements also require related production of service parts subsequent to the initial vehicle production periods. Additionally, we generate revenue from the production of parts sold in aftermarket service channels and to non-automotive commercial customers. Revenue Recognition: Our contracts with customers under long-term supply agreements do not commit the customer to a specified quantity of parts. However, we are generally required to fulfill our customers’ purchasing requirements for the production life of the vehicle. Contracts do not become a performance obligation until we receive either a purchase order and/or customer release for a specific number of parts at a specified price. While long-term supply agreements may range from four to six years for new vehicle production and ten to fifteen subsequent years for service parts production, contracts may be terminated by customers at any time. Historically, terminations have been minimal. Contracts may also provide for annual price reductions over the production life of the vehicle, and prices are adjusted on an ongoing basis to reflect changes in product content/cost and other commercial factors. Revenue is recognized at a point in time when control of the parts produced are transferred to the customer according to the terms of the contract, which is usually when the parts are shipped or delivered to the customer’s premises. Customers are generally invoiced upon shipment or delivery and payment generally occurs within 45 to 90 days after the shipment date. The amount of revenue recognized reflects the consideration that we expect to be entitled to receive in exchange for those products based on purchase orders, annual price reductions and ongoing price adjustments, some of which are accounted for as variable consideration. We use the most likely amount method, the single most likely outcome of the contract, to estimate the amount to which we expect to be entitled. There were no significant changes to our estimates of variable consideration during the reporting periods referenced in our accompanying financial statements and significant changes to our estimates of variable consideration are not expected in future periods. We do not have an enforceable right to payment at any time prior to when the parts are shipped or delivered to the customer. Therefore, we recognize revenue at the point in time we satisfy a performance obligation by transferring control of a part to a customer. Amounts billed to customers related to shipping and handling costs are included in Net Sales in the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income. Shipping and handling costs are accounted for as fulfillment costs and are included in Cost of Goods Sold in the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income. Tooling and Pre-Production Engineering Costs Related to Long-Term Supply Arrangements: We incur pre-production engineering and tooling costs related to the products produced for our customers under long-term supply agreements. Customer reimbursements for tooling and pre-production engineering activities that are part of a long-term supply arrangement are accounted for as a reduction of cost in accordance with ASC 340, Other Assets and Deferred Costs. Pre-production costs related to long-term supply agreements with a contractual guarantee for reimbursement are included in Other Current Assets in the accompanying Consolidated Balance Sheets. We expense all pre-production engineering costs for which reimbursement is not contractually guaranteed by the customer. All pre-production tooling costs related to customer-owned tools for which reimbursement is not contractually guaranteed by the customer or for which we do not have a non-cancelable right to use the tooling is also expensed when incurred. Receivables, net: Receivables, net include amounts billed and currently due from customers. We maintain an allowance for doubtful accounts to provide for estimated amounts of receivables not expected to be collected. We continually assess our receivables for collectability and any allowance is recorded based upon age of the outstanding receivables, historical payment experience, customer creditworthiness and general economic conditions. Contract Balances: We have no material contract assets as of June 28, 2020. Contract liability balances primarily include discounts recognized as a reduction in sales at the point of revenue recognition, but which will be applied by the customer agreement after the end of the reporting period. The activity related to contract liability balances during the year ended June 28, 2020 was as follows (thousands of dollars): Balance, June 30, 2019 $ 932 Discounts Recorded as a Reduction in Sales 1,048 Payments of Discounts to Customers (915 ) Other (692 ) Balance, June 28, 2020 $ 373 Refer to Product Sales and Sales and Receivable Concentration included herein for revenue by product group and revenue by customer. |
Research and Development Costs | Research and Development Costs: Expenditures relating to the development of new products and processes, including significant improvements and refinements to existing products, are expensed as incurred. Research and development expenditures were approximately $9.8 million in 2020 and $13.8 million in 2019. |
Other Income (Expense), Net | Other Income (Expense), Net: Net other income (expense) included in the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income primarily included foreign currency transaction gains and losses, realized and unrealized gains and losses on our Mexican peso currency forward contracts, the components of net periodic benefit cost other than the service cost component related to our pension and postretirement plans and Rabbi Trust gains and losses. Foreign currency transaction gains and losses resulted from activity associated with foreign denominated assets held by our Mexican subsidiaries. The Rabbi Trust assets fund our amended and restated supplemental executive retirement plan. The investments held in the Trust are considered trading securities. We entered into the Mexican peso currency forward contracts during fiscal 2020 and 2019 to minimize earnings volatility resulting from changes in exchange rates affecting the U.S. dollar cost of our Mexican operations. Unrealized gains and losses on the peso forward contracts recognized as a result of mark-to-market adjustments as of June 28, 2020 may or may not be realized in future periods, depending on actual Mexican peso to U.S. dollar exchange rates experienced during the balance of the contract period. Pension and postretirement plan costs include the components of net periodic benefit cost other than the service cost component. Additionally, during fiscal 2020, other miscellaneous income, net includes $450,000 of favorable valued-added tax adjustments realized by our Mexican entities and $434,000 of experience gains from asset returns related to the termination of our Qualified Pension Plan as discussed under Retirement Plans and Postretirement Costs. Years Ended June 28, 2020 June 30, 2019 Foreign currency transaction gain (loss) $ 1,982 $ (397 ) Rabbi Trust (loss) gain (2 ) 146 Unrealized (loss) gain on Mexican peso forward contracts (480 ) 39 Realized (loss) gain on Mexican peso forward contracts (418 ) 485 Pension and postretirement plans cost (469 ) (689 ) Other 1,055 79 $ 1,668 $ (337 ) |
Warranty Reserve | Warranty Reserve: We have a warranty liability recorded related to our known and potential exposure to warranty claims in the event our products fail to perform as expected, and in the event we may be required to participate in the repair costs incurred by our customers for such products. The recorded warranty liability balance involves judgment and estimates. Our liability estimate is based on an analysis of historical warranty data as well as current trends and information, including our customers’ recent extension and/or expansion of their warranty programs. In recent fiscal periods, our largest customers have extended their warranty protection for their vehicles and have since demanded higher warranty cost sharing arrangements from their suppliers in their terms and conditions to purchase, including from STRATTEC. As additional information becomes available, actual results may differ from recorded estimates, which may require us to adjust the amount of our warranty provision. Changes in the warranty reserve were as follows (thousands of dollars): Balance, Beginning of Year Provision Charged to Expense Payments Balance, End of Year Year ended June 28, 2020 $ 7,900 $ 823 $ 223 $ 8,500 Year ended June 30, 2019 $ 7,800 $ 559 $ 459 $ 7,900 |
Foreign Currency Translation | Foreign Currency Translation: The financial statements of our foreign subsidiaries and equity investees are translated into U.S. dollars using the exchange rate at each balance sheet date for assets and liabilities and the average exchange rate for each applicable period for sales, costs and expenses. Foreign currency translation adjustments are included as a component of accumulated other comprehensive loss. Foreign currency transaction gains and losses are included in other income (expense), net in the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income. |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss: Accumulated other comprehensive loss (“AOCL”) was comprised of the following (thousands of dollars): June 28, 2020 June 30, 2019 Unrecognized pension and postretirement benefit liabilities, net of tax $ 1,977 $ 2,251 Foreign currency translation, net of tax 20,136 16,317 $ 22,113 $ 18,568 The following tables summarize the changes in AOCL for the years ended June 28, 2020 and June 30, 2019 (thousands of dollars): Year Ended June 28, 2020 Foreign Currency Translation Adjustments Retirement and Postretirement Plans Total Balance June 30, 2019 $ 16,317 $ 2,251 $ 18,568 Other comprehensive loss before reclassifications 6,153 25 6,178 Income Tax (357 ) (6 ) (363 ) Net other comprehensive loss before Reclassifications 5,796 19 5,815 Reclassifications: Prior service credits (A) — 29 29 Actuarial losses (A) — (412 ) (412 ) Total reclassifications before tax — (383 ) (383 ) Income Tax — 90 90 Net reclassifications — (293 ) (293 ) Other comprehensive loss 5,796 (274 ) 5,522 Other comprehensive loss attributable to non-controlling interest 1,977 — 1,977 Balance June 28, 2020 $ 20,136 $ 1,977 $ 22,113 Year Ended June 30, 2019 Foreign Currency Translation Adjustments Retirement and Postretirement Plans Total Balance July 1, 2018 $ 15,291 $ 18,148 $ 33,439 Other comprehensive loss before reclassifications 545 170 715 Income Tax 10 (40 ) (30 ) Net other comprehensive loss before Reclassifications 555 130 685 Reclassifications: Pension termination settlements (A) — (25,668 ) (25,668 ) Prior service credits (A) — 439 439 Actuarial losses (A) — (1,262 ) (1,262 ) Total reclassifications before tax — (26,491 ) (26,491 ) Income Tax — 6,500 6,500 Net reclassifications — (19,991 ) (19,991 ) Other comprehensive income 555 (19,861 ) (19,306 ) Other comprehensive income attributable to non-controlling interest (388 ) — (388 ) Reclassification of stranded tax effects 83 3,964 4,047 Balance June 30, 2019 $ 16,317 $ 2,251 $ 18,568 (A) Amounts reclassified are included in the computation of net periodic benefit cost, which is included in Other Income (Expense), net in the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income. See Retirement Plans and Postretirement Costs note to these Notes to Financial Statements below. |
Accounting for Stock-Based Compensation | Accounting for Stock-Based Compensation: We maintain an omnibus stock incentive plan. This plan provides for the granting of stock options, shares of restricted stock and stock appreciation rights. The Board of Directors has designated 1,850,000 shares of common stock available for the grant of awards under the plan. Remaining shares available to be granted under the plan as of June 28, 2020 were 116,334. Awards that expire or are cancelled without delivery of shares become available for re-issuance under the plan. We issue new shares of common stock to satisfy stock option exercises. Nonqualified and incentive stock options and shares of restricted stock have been granted to our officers, outside directors and specified associates under the stock incentive plan. Stock options granted under the plan may not be issued with an exercise price less than the fair market value of the common stock on the date the option is granted. Stock options become exercisable as determined at the date of grant by the Compensation Committee of our Board of Directors. The options expire 10 years after the grant date unless an earlier expiration date is set at the time of grant. The options vest 1 to 4 years after the date of grant. Shares of restricted stock granted under the plan are subject to vesting criteria determined by the Compensation Committee of our Board of Directors at the time the shares are granted and have a minimum vesting period of one year from the date of grant. Restricted shares granted have voting rights, regardless of whether the shares are vested or unvested, but only have the right to receive cash dividends after such shares become vested. Restricted stock grants issued vest 1 to 5 years after the date of grant. The fair value of each stock option grant was estimated as of the date of grant using the Black-Scholes pricing model. The resulting compensation cost for fixed awards with graded vesting schedules is amortized on a straight-line basis over the vesting period for the entire award. The expected term of awards granted is determined based on historical experience with similar awards, giving consideration to the contractual terms and vesting schedules. The expected volatility is determined based on our historical stock prices over the most recent period commensurate with the expected term of the award. The risk-free interest rate is based on U.S. Treasury zero-coupon issues with a remaining term commensurate with the expected term of the award. Expected pre-vesting option forfeitures are based primarily on historical data. The fair value of each restricted stock grant was based on the market price of the underlying common stock as of the date of grant. The resulting compensation cost is amortized on a straight-line basis over the vesting period. We record stock based compensation only for those awards that are expected to vest. All compensation cost related to stock options granted under the plan has been recognized as of June 28, 2020. Unrecognized compensation cost as of June 28, 2020 related to restricted stock granted under the plan was as follows (thousands of dollars): Compensation Cost Weighted Average Period over which Cost is to be Recognized (in years) Restricted stock granted $ 858 0.8 Unrecognized compensation cost will be adjusted for any future changes in estimated and actual forfeitures. Cash received from stock option exercises and the related income tax benefit were as follows (thousands of dollars): Fiscal Year Cash Received from Stock Option Exercises Income Tax Benefit 2020 $ 477 $ 28 2019 $ 172 $ 76 The intrinsic value of stock options exercised and the fair value of options vested were as follows (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Intrinsic value of options exercised $ 120 $ 324 Fair value of stock options vested $ — $ — No options were granted during the fiscal years ended June 28, 2020 or June 30, 2019. The range of options outstanding as of June 28, 2020 was as follows: Number of Options Outstanding/ Exercisable Weighted Average Exercise Price Outstanding/ Exercisable Weighted Average Remaining Contractual Life Outstanding (In Years) $26.53-$25.64 49,660/49,660 $26.10/$26.10 1.63 $38.71 32,190/32,190 $38.71/$38.71 3.14 $79.73 9,010/9,010 $79.73/$79.73 4.14 90,860/90,860 $35.88/$35.88 |
Income Taxes | Income Taxes: 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 assets and liabilities and their respective tax bases and operating loss carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in years in which those temporary differences are expected to be recovered, settled or utilized. 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. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. We recognize the benefit of an income tax position only if it is more likely than not (greater than 50 percent) that the tax position will be sustained upon tax examination, based solely on the technical merits of the tax position. Otherwise, no benefit is recognized. The tax benefits recognized are measured based on the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement. Additionally, we accrue interest and related penalties, if applicable, on all tax exposures for which reserves have been established consistent with jurisdictional tax laws. Interest and penalties on uncertain tax positions are classified in the (Benefit) Provision for Income Taxes in the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income. |
Organization and Summary of S_3
Organization and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Schedule of Quantification of Outstanding Mexican Peso Forward Contracts | The following table quantifies the outstanding Mexican peso forward contracts as of June 28, 2020 (thousands of dollars, except with respect to the average forward contractual exchange rate): Effective Dates Notional Amount Average Forward Contractual Exchange Rate Fair Value Buy MXP/Sell USD July 15, 2020 - December 16, 2020 $ 6,000 21.40 $ (480 ) |
Fair Market Value of All Outstanding Peso Forward Contracts | The fair market value of all outstanding Mexican peso forward contracts in the accompanying Consolidated Balance Sheets was as follows (thousands of dollars): June 28, 2020 June 30, 2019 Not designated as hedging instruments: Other current liabilities: Mexican peso forward contracts $ 480 $ — |
Pre-Tax Effects of the Peso Forward Contracts | The pre-tax effects of the Mexican peso forward contracts on the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income consisted of the following (thousands of dollars): Other Income, net Years Ended June 28, 2020 June 30, 2019 Not Designated as Hedging Instruments: Realized (loss) gain $ (418 ) $ 485 Unrealized (loss) gain $ (480 ) $ 39 |
Summary of Financial Assets and Liabilities at Fair Value on Recurring Basis | The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of June 28, 2020 and June 30, 2019 (thousands of dollars) June 28, 2020 June 30, 2019 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Rabbi Trust assets: Stock index funds: Small cap $ 251 $ — $ — $ 251 $ 276 $ — $ — $ 276 Mid cap 284 — — 284 293 — — 293 Large cap 563 — — 563 589 — — 589 International 820 — — 820 864 — — 864 Fixed income funds 793 — — 793 913 — — 913 Cash and cash equivalents — 224 — 224 — 3 — 3 Total assets at fair value $ 2,711 $ 224 $ — $ 2,935 $ 2,935 $ 3 $ — $ 2,938 Liabilities: Mexican peso forward contracts $ — $ 480 $ — $ — $ — $ — $ — $ — |
Inventories | Inventories consisted of the following (thousands of dollars): June 28, 2020 June 30, 2019 Finished products $ 13,142 $ 11,582 Work in process 11,815 10,529 Purchased materials 34,333 29,376 59,290 51,487 Excess and obsolete reserve (4,890 ) (4,225 ) Inventories, net $ 54,400 $ 47,262 |
Activity Related to the Excess and Obsolete Inventory Reserve | The activity related to the excess and obsolete inventory reserve was as follows (thousands of dollars): Balance, Beginning of Year Provision Charged to Expense Amounts Written Off Balance, End of Year Year ended June 28, 2020 $ 4,225 $ 2,178 $ 1,513 $ 4,890 Year ended June 30, 2019 $ 4,000 $ 799 $ 574 $ 4,225 |
Property, Plant and Equipment, Useful Lives of Assets | Property, plant and equipment are stated at cost. Property, plant and equipment are depreciated on a straight-line basis over the estimated useful lives of the assets as follows: Classification Expected Useful Lives Land improvements 20 years Buildings and improvements 15 to 35 years Machinery and equipment 3 to 15 years |
Property, Plant and Equipment | Property, plant and equipment consisted of the following (thousands of dollars): June 28, 2020 June 30, 2019 Land and improvements $ 5,002 $ 5,679 Buildings and improvements 33,179 35,742 Machinery and equipment 228,035 246,000 266,216 287,421 Less: accumulated depreciation (161,068 ) (169,301 ) $ 105,148 $ 118,120 |
Schedule of Depreciation Expenses | Depreciation expense was as follows for the periods indicated (thousands of dollars): Fiscal Year Depreciation Expense 2020 $ 19,329 2019 $ 17,159 |
Schedule of Operating Lease Asset and Obligation Included in Condensed Consolidated Balance Sheet | The operating lease asset and obligation related to our El Paso warehouse lease included in the accompanying Condensed Consolidated Balance Sheet are presented below (thousands of dollars): June 28, 2020 Right-of-Use Asset Under Operating Lease: Other Long-Term Assets $ 3,753 Lease Obligation Under Operating Lease: Current Liabilities: Accrued Liabilities: Other $ 354 Other Long-Term Liabilities 3,399 $ 3,753 |
Schedule of Future Minimum Lease Payments Under Non-Cancelable Lease Including Options to Extend | Future minimum lease payments, by our fiscal year, including options to extend that are reasonably certain to be exercised, under the non-cancelable lease are as follows as of June 28, 2020 (thousands of dollars): 2021 $ 473 2022 484 2023 497 2024 509 Thereafter 2,356 Total Future Minimum Lease Payments 4,319 Less: Imputed Interest (566 ) Total Lease Obligations $ 3,753 |
Schedule of Future Minimum Lease Payments Under Non-Cancelable Lease Excluding Options to Extend Prior to Adoption | Future minimum lease payments, by our fiscal year, excluding options to extend that are reasonably certain to be exercised, prior to the adoption of the new accounting guidance on leases were as follows as of June 30, 2019 (thousands of dollars): 2020 $ 539 2021 504 2022 495 2023 498 2024 168 Thereafter — Total Future Minimum Lease Payments $ 2,204 |
Schedule of Cash Flow Information Related to Operating Lease | Cash flow information related to the operating lease is shown below (thousands of dollars): Year Ended June 28, 2020 Operating Cash Flows: Cash Paid Related to Operating Lease Obligation $ 461 Non-Cash Activity: Right-of-Use Asset Obtained in Exchange for Operating Lease Obligation $ — |
Schedule of Weighted Average Lease Term and Discount Rate for Operating Lease | The weighted average lease term and discount rate for the El Paso, Texas operating lease are shown below: June 28, 2020 Weighted Average Remaining Lease Term (in years) 8.3 Weighted Average Discount Rate 3.3 % |
Inventory Purchase from Major Suppliers | Supplier Concentrations: The following inventory purchases were made from major suppliers during each fiscal year noted Fiscal Year Percentage of Inventory Purchases Number of Suppliers 2020 39 % 7 2019 39 % 7 |
Contract Liability Balances | The activity related to contract liability balances during the year ended June 28, 2020 was as follows (thousands of dollars): Balance, June 30, 2019 $ 932 Discounts Recorded as a Reduction in Sales 1,048 Payments of Discounts to Customers (915 ) Other (692 ) Balance, June 28, 2020 $ 373 |
Summary of Other Income (Expense), Net | The impact of these items for the periods presented was as follows (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Foreign currency transaction gain (loss) $ 1,982 $ (397 ) Rabbi Trust (loss) gain (2 ) 146 Unrealized (loss) gain on Mexican peso forward contracts (480 ) 39 Realized (loss) gain on Mexican peso forward contracts (418 ) 485 Pension and postretirement plans cost (469 ) (689 ) Other 1,055 79 $ 1,668 $ (337 ) |
Changes in Warranty Reserve | Changes in the warranty reserve were as follows (thousands of dollars): Balance, Beginning of Year Provision Charged to Expense Payments Balance, End of Year Year ended June 28, 2020 $ 7,900 $ 823 $ 223 $ 8,500 Year ended June 30, 2019 $ 7,800 $ 559 $ 459 $ 7,900 |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss: Accumulated other comprehensive loss (“AOCL”) was comprised of the following (thousands of dollars): June 28, 2020 June 30, 2019 Unrecognized pension and postretirement benefit liabilities, net of tax $ 1,977 $ 2,251 Foreign currency translation, net of tax 20,136 16,317 $ 22,113 $ 18,568 |
Summary of Changes in Accumulated Other Comprehensive Loss | The following tables summarize the changes in AOCL for the years ended June 28, 2020 and June 30, 2019 (thousands of dollars): Year Ended June 28, 2020 Foreign Currency Translation Adjustments Retirement and Postretirement Plans Total Balance June 30, 2019 $ 16,317 $ 2,251 $ 18,568 Other comprehensive loss before reclassifications 6,153 25 6,178 Income Tax (357 ) (6 ) (363 ) Net other comprehensive loss before Reclassifications 5,796 19 5,815 Reclassifications: Prior service credits (A) — 29 29 Actuarial losses (A) — (412 ) (412 ) Total reclassifications before tax — (383 ) (383 ) Income Tax — 90 90 Net reclassifications — (293 ) (293 ) Other comprehensive loss 5,796 (274 ) 5,522 Other comprehensive loss attributable to non-controlling interest 1,977 — 1,977 Balance June 28, 2020 $ 20,136 $ 1,977 $ 22,113 Year Ended June 30, 2019 Foreign Currency Translation Adjustments Retirement and Postretirement Plans Total Balance July 1, 2018 $ 15,291 $ 18,148 $ 33,439 Other comprehensive loss before reclassifications 545 170 715 Income Tax 10 (40 ) (30 ) Net other comprehensive loss before Reclassifications 555 130 685 Reclassifications: Pension termination settlements (A) — (25,668 ) (25,668 ) Prior service credits (A) — 439 439 Actuarial losses (A) — (1,262 ) (1,262 ) Total reclassifications before tax — (26,491 ) (26,491 ) Income Tax — 6,500 6,500 Net reclassifications — (19,991 ) (19,991 ) Other comprehensive income 555 (19,861 ) (19,306 ) Other comprehensive income attributable to non-controlling interest (388 ) — (388 ) Reclassification of stranded tax effects 83 3,964 4,047 Balance June 30, 2019 $ 16,317 $ 2,251 $ 18,568 (A) Amounts reclassified are included in the computation of net periodic benefit cost, which is included in Other Income (Expense), net in the accompanying Consolidated Statements of Loss and Comprehensive (Loss) Income. See Retirement Plans and Postretirement Costs note to these Notes to Financial Statements below. |
Schedule of Unrecognized Compensation Cost | Unrecognized compensation cost as of June 28, 2020 related to restricted stock granted under the plan was as follows (thousands of dollars): Compensation Cost Weighted Average Period over which Cost is to be Recognized (in years) Restricted stock granted $ 858 0.8 |
Cash Received from Stock Option Exercises and Related Income Tax Benefit | Cash received from stock option exercises and the related income tax benefit were as follows (thousands of dollars): Fiscal Year Cash Received from Stock Option Exercises Income Tax Benefit 2020 $ 477 $ 28 2019 $ 172 $ 76 |
Intrinsic Value of Stock Options Exercised and Fair Value Of Stock Options Vested | The intrinsic value of stock options exercised and the fair value of options vested were as follows (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Intrinsic value of options exercised $ 120 $ 324 Fair value of stock options vested $ — $ — |
Range of Options Outstanding | The range of options outstanding as of June 28, 2020 was as follows Number of Options Outstanding/ Exercisable Weighted Average Exercise Price Outstanding/ Exercisable Weighted Average Remaining Contractual Life Outstanding (In Years) $26.53-$25.64 49,660/49,660 $26.10/$26.10 1.63 $38.71 32,190/32,190 $38.71/$38.71 3.14 $79.73 9,010/9,010 $79.73/$79.73 4.14 90,860/90,860 $35.88/$35.88 |
MEXICO | |
Property, Plant and Equipment | The gross and net book value of property, plant and equipment located outside of the United States, primarily in Mexico, were as follows (thousands of dollars): June 28, 2020 June 30, 2019 Gross book value $ 146,690 $ 157,551 Net book value $ 71,369 $ 80,922 |
Investment in Joint Ventures _2
Investment in Joint Ventures and Majority Owned Subsidiaries (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Equity Method Investments And Joint Ventures [Abstract] | |
Schedule of Joint Venture Investments | STRATTEC’s joint venture investments are included in the accompanying Consolidated Balance Sheets as follows (thousands of dollars): June 28, 2020 June 30, 2019 Investment in Joint Ventures: Investment in VAST LLC $ 22,068 $ 23,528 Other Current Liabilities: Investment in SAL LLC $ — $ 328 |
Equity (Loss) Earnings of Joi_2
Equity (Loss) Earnings of Joint Ventures (Tables) - VAST LLC | 12 Months Ended |
Jun. 28, 2020 | |
Summarized Statements of Operations and Balance Sheet Data | The following are summarized statements of operations and summarized balance sheet data for VAST LLC (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Net sales $ 153,006 $ 161,660 Cost of goods sold 125,012 128,375 Gross profit 27,994 33,285 Engineering, selling and administrative expense 28,812 27,624 Impairment charge 2,000 — (Loss) income from operations (2,818 ) 5,661 Other income, net 1,556 3,559 (Loss) income before provision for income taxes (1,262 ) 9,220 Provision for income taxes 466 1,292 Net (loss) income $ (1,728 ) $ 7,928 STRATTEC’s share of VAST LLC net (loss) income $ (576 ) $ 2,643 Intercompany profit eliminations 11 12 STRATTEC’s equity (loss) earnings of VAST LLC $ (565 ) $ 2,655 June 28, 2020 June 30, 2019 Cash and cash equivalents $ 8,549 $ 6,854 Receivables, net 40,983 35,639 Inventories, net 22,285 20,465 Other current assets 17,674 19,701 Total current assets 89,491 82,659 Property, plant and equipment, net 63,574 49,953 Other long-term assets 14,387 16,868 Total assets $ 167,452 $ 149,480 Current debt $ 13,072 $ 7,240 Other current liabilities 72,878 63,799 Long-term debt 12,778 5,015 Other long-term liabilities 2,228 2,512 Total liabilities $ 100,956 $ 78,566 Net assets $ 66,496 $ 70,914 STRATTEC’s share of VAST LLC net assets $ 22,165 $ 23,638 |
Summarize of Related Party Transaction | The following tables summarize the related party transactions with VAST LLC for the periods indicated (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Sales to VAST LLC $ 4,041 $ 3,731 Purchases from VAST LLC $ 469 $ 221 Expenses charged to VAST LLC $ 2,299 $ 1,594 Expenses charged from VAST LLC $ 935 $ 834 June 28, 2020 June 30, 2019 Accounts receivable from VAST LLC $ 1,115 $ 264 Accounts payable to VAST LLC $ 239 $ 127 |
Credit Facilities (Tables)
Credit Facilities (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Outstanding Borrowings Under the Credit Facilities | Outstanding borrowings under the credit facilities referenced in the above paragraph as of the end of 2020 and 2019 were as follows (thousands of dollars): June 28, 2020 June 30, 2019 STRATTEC Credit Facility $ 18,000 $ 18,000 ADAC-STRATTEC Credit Facility 17,000 24,000 $ 35,000 $ 42,000 |
Schedule of Average Outstanding Borrowings and the Weighted Average Interest Rate | Average outstanding borrowings and the weighted average interest rate under each such credit facility during 2020 and 2019 were as follows (thousands of dollars): Average Outstanding Borrowings Weighted Average Interest Rate Years Ended Years Ended June 28, 2020 June 30, 2019 June 28, 2020 June 30, 2019 STRATTEC Credit Facility $ 13,827 $ 21,212 2.6 % 3.3 % ADAC-STRATTEC Credit Facility $ 19,121 $ 25,901 2.9 % 3.4 % |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Purchase and Minimum Rental Commitments Under Non-Cancelable Operating Leases | At June 28, 2020, we had purchase commitments related to zinc, other purchased parts and natural gas. We also had minimum rental commitments under non-cancelable operating leases with a term in excess of one year. The purchase and minimum rental commitments are payable as follows (thousands of dollars): Purchase Minimum Rental Fiscal Year Commitments Commitments 2021 $ 9,545 $ 473 2022 $ 4,183 $ 484 2023 $ — $ 497 2024 $ — $ 509 2025-2026 $ — $ 2,356 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Income Tax Disclosure [Abstract] | |
Provision (Benefit) for Income Taxes | The provision for income taxes consisted of the following (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Currently (recoverable) payable: Federal $ (1,869 ) $ 705 State (176 ) 162 Foreign 3,368 1,515 1,323 2,382 Deferred tax provision (3,589 ) (10,122 ) $ (2,266 ) $ (7,740 ) |
Difference Between Income Taxes Computed at the Federal Statutory Tax Rate and the Provision for Income Taxes | The items accounting for the difference between income taxes computed at the Federal statutory tax rate and the provision for income taxes were as follows: Years Ended June 28, 2020 June 30, 2019 U.S. statutory rate 21.0 % 21.0 % State taxes, net of Federal tax benefit 2.1 3.7 Foreign subsidiaries (5.8 ) (1.8 ) U.S. tax reform: transition tax — 2.7 Federal net operating loss carry-back statutory rate differential 11.7 — Global intangible low-taxed income (4.4 ) (0.7 ) Research and development tax credit 9.9 9.4 Non-controlling interest (2.3 ) 6.7 Uncertain tax positions (4.0 ) (2.3 ) Stock based compensation (1.8 ) (0.7 ) Other 1.5 (0.1 ) 27.9 % 37.9 % |
Components of Deferred Tax (Liabilities) Assets | The components of deferred tax (liabilities) assets were as follows (thousands of dollars): June 28, 2020 June 30, 2019 Unrecognized pension and postretirement plan liabilities $ 617 $ 701 Accrued warranty 517 446 Payroll-related accruals 2,259 2,180 Stock-based compensation 389 470 Inventory reserve 964 834 Environmental reserve 296 300 Repair and maintenance supply parts reserve 510 229 Allowance for doubtful accounts 118 118 Lease liability 882 — Right of use assets (882 ) — Credit carry-forwards 3,860 1,990 Postretirement obligations (357 ) (416 ) Accumulated depreciation (5,063 ) (5,023 ) Accrued pension obligations 472 (1,578 ) Non-cash compensation expense — 986 Joint ventures 1,167 968 Other 741 728 $ 6,490 $ 2,933 |
Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows for the years ended June 28, 2020 and June 30, 2019 (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Unrecognized tax benefits, beginning of year $ 1,138 $ 741 Gross increases – tax positions in prior years 140 229 Gross increases – current period tax positions 245 238 Tax years closed (61 ) (70 ) Unrecognized tax benefits, end of year $ 1,462 $ 1,138 |
Retirement Plans and Postreti_2
Retirement Plans and Postretirement Costs (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Compensation And Retirement Disclosure [Abstract] | |
Amounts Included in Accumulated Other Comprehensive Loss, Net of Tax | Amounts included in accumulated other comprehensive loss, net of tax, at June 28, 2020, which have not yet been recognized in net periodic benefit cost were as follows (thousands of dollars): SERP Postretirement Prior service credit $ — $ (6 ) Net actuarial loss 215 1,768 $ 215 $ 1,762 |
Amounts Included in Accumulated Other Comprehensive Loss Expected to be Recognized, Net of Tax | Prior service cost (credit) and unrecognized net actuarial losses included in accumulated other comprehensive loss at June 28, 2020 which are expected to be recognized in net periodic benefit cost (credit) in fiscal 2021, net of tax, for the pension, SERP and postretirement plans are as follows (thousands of dollars): SERP Postretirement Prior service credit $ — $ (6 ) Net actuarial loss 8 274 $ 8 $ 268 |
Summary of Pension Supplemental Executive Retirement Plan and Postretirement Plans Income and Expense | The following tables summarize the pension, SERP and postretirement plans’ income and expense, funded status and actuarial assumptions for the years indicated (thousands of dollars). We use a June 30 measurement date for our pension and postretirement plans. Pension and SERP Benefits Postretirement Benefits Years Ended Years Ended June 28, 2020 June 30, 2019 June 28, 2020 June 30, 2019 COMPONENTS OF NET PERIODIC BENEFIT COST: Service cost $ 74 $ 62 $ 12 $ 11 Interest cost 61 2,101 26 40 Expected return on plan assets — (2,275 ) — — Plan settlements — 31,878 — — Amortization of prior service cost (credit) — — (29 ) (439 ) Amortization of unrecognized net loss 15 831 397 431 Net periodic benefit cost (credit) $ 150 $ 32,597 $ 406 $ 43 WEIGHTED-AVERAGE ASSUMPTIONS: Benefit Obligations: Discount rate 2.33 % 3.17 % 2.07 % 3.01 % Rate of compensation increases – SERP 3.0 % 3.0 % n/a n/a Net Periodic Benefit Cost: Discount rate 3.17 % 4.30 % 3.01 % 4.30 % Rate of compensation increases – SERP 3.0 % 3.0 % n/a n/a CHANGE IN PROJECTED BENEFIT OBLIGATION: Benefit obligation at beginning of year $ 2,229 $ 98,835 $ 914 $ 1,041 Service cost 74 62 12 11 Interest cost 61 2,101 26 40 Plan settlements — (72,400 ) — — Actuarial gain 3 5,143 22 39 Benefits paid (74 ) (31,512 ) (153 ) (217 ) Benefit obligation at end of year $ 2,293 $ 2,229 $ 821 $ 914 CHANGE IN PLAN ASSETS: Fair value of plan assets at beginning of year $ 8,645 $ 111,466 $ — $ — Actual return on plan assets 84 1,077 — — Employer contribution 14 14 153 217 Excess Asset Transfer (9,019 ) — — — Plan settlements 350 (72,400 ) — — Benefits paid (74 ) (31,512 ) (153 ) (217 ) Fair value of plan assets at end of year $ - $ 8,645 $ — $ — Funded status – (accrued) prepaid benefit obligations $ (2,293 ) $ 6,416 $ (821 ) $ (914 ) AMOUNTS RECOGNIZED IN CONSOLIDATED BALANCE SHEETS: Other long-term assets $ — $ 8,585 $ — $ — Accrued payroll and benefits (current liabilities) (1,039 ) (506 ) (120 ) (152 ) Accrued benefit obligations (long-term liabilities) (1,254 ) (1,663 ) (701 ) (762 ) Net amount recognized $ (2,293 ) $ 6,416 $ (821 ) $ (914 ) CHANGES IN PLAN ASSETS AND BENEFIT OBLIGATIONS RECOGNIZED IN OTHER COMPREHENSIVE INCOME: Net periodic benefit cost $ 150 $ 32,597 $ 406 $ 43 Net actuarial loss (gain) 3 (57,414 ) 22 39 Plan settlements — 31,878 — — Amortization of prior service credits — — 29 439 Amortization of unrecognized net loss (15 ) (831 ) (397 ) (431 ) Total recognized in other comprehensive (income) loss, before tax (12 ) (26,367 ) (346 ) 47 Total recognized in net periodic benefit cost and other comprehensive loss, before tax $ 138 $ 6,230 $ 60 $ 90 |
The Accumulated Benefit Obligations and Projected Benefit Obligations for the Pension and SERP | The following table summarizes the accumulated benefit obligations and projected benefit obligations for the pension and SERP (thousands of dollars): Pension SERP June 28, 2020 June 30, 2019 June 28, 2020 June 30, 2019 Accumulated benefit obligation $ — $ 60 $ 2,176 $ 1,981 Projected benefit obligation $ — $ 60 $ 2,293 $ 2,169 |
Minimal Effect of Health Care Trend on our Postretirement Benefit | The health care cost trend assumption has a minimal effect on our postretirement benefit amounts reported. A 1% change in the health care cost trend rates would have the following effects (thousands of dollars): 1% Increase 1% Decrease Effect on total of service and interest cost components in fiscal 2020 $ — $ — Effect on postretirement benefit obligation as of June 30, 2020 $ 3 $ (3 ) |
Expected Future Benefit Payments | The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid during the fiscal years noted below (thousands of dollars): SERP Benefits Postretirement Benefits 2021 $ 1,040 $ 119 2022 $ 402 $ 116 2023 $ 14 $ 103 2024 $ 14 $ 93 2025 $ 14 $ 64 2026-2030 $ 928 $ 218 |
Schedule of 401(k) Plan Contribution | Our contributions to the 401(k) Plan were as follows (thousands of dollars): Years Ended June 28, 2020 June 30, 2019 Company contributions $ 1,709 $ 1,903 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Earnings Per Share [Abstract] | |
Reconciliation of the Components of Basic and Diluted Per Share | A reconciliation of the components of the basic and diluted per share computations follows (in thousands, except per share amounts): Years Ended June 28, 2020 June 30, 2019 Net loss attributable to STRATTEC $ (7,605 ) $ (17,029 ) Weighted average shares of common stock outstanding 3,737 3,676 Incremental shares – stock based compensation — — Diluted weighted average shares of common stock Outstanding 3,737 3,676 Basic loss per share $ (2.04 ) $ (4.63 ) Diluted loss per share $ (2.04 ) $ (4.63 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | Potentially dilutive common shares that were excluded from the calculation of diluted earnings per share because their inclusion would have been antidilutive were as follows: Years Ended Number Excluded June 28, 2020 160,254 June 30, 2019 181,117 |
Stock Option and Purchase Pla_2
Stock Option and Purchase Plans (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Stock Option Activity Under Our Stock Incentive Plan | A summary of stock option activity under our stock incentive plan was as follows: Weighted Average Weighted Average Remaining Contractual Aggregate Intrinsic Value Shares Exercise Price Term (in years) (in thousands) Balance at July 1, 2018 133,074 $ 29.37 Exercised (15,714 ) $ 10.92 Balance at June 30, 2019 117,360 $ 31.85 Exercised (26,500 ) $ 18.00 Balance at June 28, 2020 90,860 $ 35.88 2.4 $ — Exercisable as of: June 28, 2020 90,860 $ 35.88 2.4 $ — June 30, 2019 117,360 $ 31.85 2.7 $ 162 |
Summary of Restricted Stock Activity Under Our Stock Incentive Plan | A summary of restricted stock activity under our stock incentive plan was as follows: Weighted Average Grant Date Shares Fair Value Nonvested Balance at July 1, 2018 69,125 $ 49.02 Granted 34,050 $ 37.25 Vested (37,343 ) $ 54.93 Forfeited (2,075 ) $ 43.52 Nonvested Balance at June 30, 2019 63,757 $ 39.47 Granted 39,150 $ 21.80 Vested (27,318 ) $ 37.86 Forfeited (6,195 ) $ 34.38 Nonvested Balance at June 28, 2020 69,394 $ 30.59 |
Export Sales (Tables)
Export Sales (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Schedule of Sales to Locations Outside of the United States | Total export sales, sales from the United States to locations outside of the United States, are summarized as follows (thousands of dollars and percent of total net sales): Years Ended June 28, 2020 June 30, 2019 Net Sales % Net Sales % Export sales $ 114,381 30% $ 160,771 33% |
Geographic Concentration Risk | Canada | |
Schedule of Sales to Locations Outside of the United States | Countries for which customer sales account for ten percent or more of total net sales are summarized as follows (thousands of dollars and percent of total net sales): Years Ended June 28, 2020 June 30, 2019 Net Sales % Net Sales % Export sales into Canada $ 46,191 12% $ 67,516 14% |
Product Sales (Tables)
Product Sales (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Product Sales | Sales by product group were as follows (thousands of dollars and percent of total net sales): Years Ended June 28, 2020 June 30, 2019 Net Sales % Net Sales % Keys & locksets $ 101,666 26 % $ 135,413 28 % Door handles & exterior trim 98,168 25 116,977 24 Power access 63,829 17 92,744 19 Latches 45,295 12 49,147 10 Aftermarket & OE service 40,742 11 44,254 9 Driver controls 29,649 8 40,942 8 Other 5,951 1 7,529 2 $ 385,300 100 % $ 487,006 100 % |
Sales and Receivable Concentr_2
Sales and Receivable Concentration (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Segment Reporting Information Receivable [Abstract] | |
Sales to Largest Customers | Sales to our largest customers were as follows (thousands of dollars and percent of total net sales): Years Ended June 28, 2020 June 30, 2019 Net Sales % Net Sales % General Motors Company $ 102,487 27 % $ 112,719 23 % Fiat Chrysler Automobiles 85,010 22 115,304 24 Ford Motor Company 52,666 13 63,333 13 $ 240,163 62 % $ 291,356 60 % |
Receivables from Largest Customers | Receivables from our largest customers were as follows (thousands of dollars and percent of gross receivables): June 28, 2020 June 30, 2019 Receivables % Receivables % General Motors Company $ 12,630 30 % $ 12,754 15 % Fiat Chrysler Automobiles 5,881 14 19,151 23 Ford Motor Company 6,101 15 9,991 12 $ 24,612 59 % $ 41,896 50 % |
Selected Quarterly Financial _2
Selected Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended |
Jun. 28, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of Selected Quarterly Financial Data | The following data are in thousands of dollars except per share amounts. Net Income (Loss) Attributable to Earnings (Loss) per Share Quarter Net Sales Gross Profit STRATTEC Basic Diluted 2020 First $ 119,962 $ 15,886 $ 1,244 $ 0.34 $ 0.33 Second 106,283 10,333 (1,341 ) (0.36 ) (0.36 ) Third 116,938 17,010 2,994 0.80 0.79 Fourth 42,117 (7,783 ) (10,502 ) (2.80 ) (2.80 ) TOTAL $ 385,300 $ 35,446 $ (7,605 ) $ (2.04 ) $ (2.04 ) 2019 First $ 117,159 $ 15,183 $ 3,467 $ 0.95 $ 0.93 Second 112,913 12,736 (22,164 ) (6.03 ) (5.96 ) Third 128,230 15,682 1,730 0.47 0.46 Fourth 128,704 14,199 (62 ) (0.02 ) (0.02 ) TOTAL $ 487,006 $ 57,800 $ (17,029 ) $ (4.63 ) $ (4.63 ) |
Organization and Summary of S_4
Organization and Summary of Significant Accounting Policies (Details Textual) | 12 Months Ended | ||
Jun. 28, 2020USD ($)SubsidiaryJoint_VentureSegmentAssociatesshares | Jun. 30, 2019USD ($)shares | Jul. 01, 2019USD ($) | |
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Number of reporting segments related to STRATTEC Security Corporation | Segment | 1 | ||
Operating lease right-of-use asset | $ 3,753,000 | ||
Operating lease obligation | $ 3,753,000 | ||
Fiscal year duration | 364 days | 364 days | |
Allowance for doubtful accounts receivable | $ 500,000 | $ 500,000 | |
Property, plant and equipment impairment | $ 0 | 0 | |
Operating lease, existence of option to extend | true | ||
Operating lease, renewal Term | 5 years | ||
Operating lease, expiration term | 2023-10 | ||
Operating lease expense | $ 461,000 | ||
Rental expense | 773,000 | ||
Number of full time associates | Associates | 3,831 | ||
Number of associates represented by labor union | Associates | 200 | ||
Percentage of associate represent by labor union | 5.20% | ||
Research and development expenditures | $ 9,800,000 | $ 13,800,000 | |
Gain loss from asset returns related to termination of qualified pension plan | $ 434,000 | ||
Options, granted | shares | 0 | 0 | |
Employee Stock Option | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Options expires after date of grant | 10 years | ||
Omnibus Stock Incentive Plan | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Share based compensation arrangement by share based payment award number of shares authorized | shares | 1,850,000 | ||
Shares of common stock available for grant | shares | 116,334 | ||
Other Miscellaneous Income, Net | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Value-added tax adjustment | $ 450,000 | ||
Minimum | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Payment generally occurs after shipment date | 45 days | ||
Minimum | Employee Stock Option | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Vesting period after the date of grant | 1 year | ||
Minimum | Restricted stock | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Vesting period after the date of grant | 1 year | ||
Minimum | New Vehicle Production | Long-term Supply Agreements | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Production period | 4 years | ||
Minimum | Service Parts Production | Long-term Supply Agreements | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Production period | 10 years | ||
Maximum | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Payment generally occurs after shipment date | 90 days | ||
Maximum | Employee Stock Option | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Vesting period after the date of grant | 4 years | ||
Maximum | Restricted stock | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Vesting period after the date of grant | 5 years | ||
Maximum | New Vehicle Production | Long-term Supply Agreements | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Production period | 6 years | ||
Maximum | Service Parts Production | Long-term Supply Agreements | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Production period | 15 years | ||
ASU 2016-02 | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Operating lease right-of-use asset | $ 4,100,000 | ||
Operating lease obligation | 4,100,000 | ||
Finance lease obligation | $ 0 | ||
COVID-19 | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Reduction in sales | $ 78,000,000 | ||
SAL, LLC | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
STRATTEC's percentage ownership in joint venture | 51.00% | ||
VAST LLC | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
STRATTEC's percentage ownership in joint venture | 33.33% | ||
VAST LLC | CHINA | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Number of wholly owned subsidiaries | Subsidiary | 4 | ||
VAST LLC | BRAZIL | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Number of wholly owned subsidiaries | Subsidiary | 1 | ||
VAST LLC | INDIA | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Number of joint venture entities | Joint_Venture | 1 |
Organization and Summary of S_5
Organization and Summary of Significant Accounting Policies - Schedule of Quantification of Outstanding Mexican Peso Forward Contracts (Details) - Buy MXP/Sell USD | 12 Months Ended |
Jun. 28, 2020USD ($)$ / $ | |
Derivative [Line Items] | |
Derivative, Effective Dates, Inception | Jul. 15, 2020 |
Derivative, Effective Dates, Maturity | Dec. 16, 2020 |
Derivative, Notional Amount | $ 6,000,000 |
Derivative, Average Forward Contractual Exchange Rate | $ / $ | 21.40 |
Derivative, Fair Value | $ (480,000) |
Organization and Summary of S_6
Organization and Summary of Significant Accounting Policies - Fair Market Value of All Outstanding Peso Forward Contracts (Details) $ in Thousands | Jun. 28, 2020USD ($) |
Other Current Liabilities | Mexican Peso Forward Contracts | |
Not designated as hedging instruments: | |
Fair market value of derivative instruments | $ 480 |
Organization and Summary of S_7
Organization and Summary of Significant Accounting Policies - Pre-Tax Effects of the Peso Forward Contracts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 28, 2020 | Jun. 28, 2020 | Jun. 30, 2019 | |
Pre-tax effects of the Mexican peso forward contracts | |||
Realized (loss) gain | $ (418) | $ 485 | |
Unrealized (loss) gain | $ (480) | 39 | |
Not Designated as Hedging Instrument | Other Expense, Net | |||
Pre-tax effects of the Mexican peso forward contracts | |||
Realized (loss) gain | $ (418) | 485 | |
Unrealized (loss) gain | $ (480) | $ 39 |
Organization and Summary of S_8
Organization and Summary of Significant Accounting Policies -Summary of Financial Assets and Liabilities at Fair Value on Recurring Basis (Details) - Fair Value Measurements Recurring - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | $ 2,935 | $ 2,938 |
Fixed Income Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 793 | 913 |
Stock Index Funds | Small Cap | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 251 | 276 |
Stock Index Funds | Mid Cap | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 284 | 293 |
Stock Index Funds | Large Cap | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 563 | 589 |
Stock Index Funds | International | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 820 | 864 |
Cash and Cash Equivalents | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 224 | 3 |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 2,711 | 2,935 |
Level 1 | Fixed Income Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 793 | 913 |
Level 1 | Stock Index Funds | Small Cap | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 251 | 276 |
Level 1 | Stock Index Funds | Mid Cap | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 284 | 293 |
Level 1 | Stock Index Funds | Large Cap | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 563 | 589 |
Level 1 | Stock Index Funds | International | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 820 | 864 |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 224 | 3 |
Level 2 | Cash and Cash Equivalents | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Assets at Fair Value | 224 | $ 3 |
Level 2 | Mexican Peso Forward Contracts | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total Liabilities at Fair Value | $ 480 |
Organization and Summary of S_9
Organization and Summary of Significant Accounting Policies - Inventories (Details) - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 | Jul. 01, 2018 |
Inventories | |||
Finished products | $ 13,142 | $ 11,582 | |
Work in process | 11,815 | 10,529 | |
Purchased materials | 34,333 | 29,376 | |
Inventory, Gross, Total | 59,290 | 51,487 | |
Excess and obsolete reserve | (4,890) | (4,225) | $ (4,000) |
Inventories, net | $ 54,400 | $ 47,262 |
Organization and Summary of _10
Organization and Summary of Significant Accounting Policies - Activity Related to the Excess and Obsolete Inventory Reserve (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Activity related to the excess and obsolete inventory reserve | ||
Balance, Beginning of Year | $ 4,225 | $ 4,000 |
Provision Charged to Expense | 2,178 | 799 |
Amounts Written Off | 1,513 | 574 |
Balance, End of Year | $ 4,890 | $ 4,225 |
Organization and Summary of _11
Organization and Summary of Significant Accounting Policies - Property, Plant and Equipment, Useful Lives of Assets (Details) | 12 Months Ended |
Jun. 28, 2020 | |
Land improvements | |
Estimated useful lives of the assets | |
Expected Useful Lives | 20 years |
Buildings and improvements | Minimum | |
Estimated useful lives of the assets | |
Expected Useful Lives | 15 years |
Buildings and improvements | Maximum | |
Estimated useful lives of the assets | |
Expected Useful Lives | 35 years |
Machinery and equipment | Minimum | |
Estimated useful lives of the assets | |
Expected Useful Lives | 3 years |
Machinery and equipment | Maximum | |
Estimated useful lives of the assets | |
Expected Useful Lives | 15 years |
Organization and Summary of _12
Organization and Summary of Significant Accounting Policies - Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
Property, plant and equipment | ||
Gross | $ 266,216 | $ 287,421 |
Less: accumulated depreciation | (161,068) | (169,301) |
Total | 105,148 | 118,120 |
Land and improvements | ||
Property, plant and equipment | ||
Gross | 5,002 | 5,679 |
Buildings and improvements | ||
Property, plant and equipment | ||
Gross | 33,179 | 35,742 |
Machinery and equipment | ||
Property, plant and equipment | ||
Gross | $ 228,035 | $ 246,000 |
Organization and Summary of _13
Organization and Summary of Significant Accounting Policies - Schedule of Depreciation Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ||
Depreciation Expense | $ 19,329 | $ 17,159 |
Organization and Summary of _14
Organization and Summary of Significant Accounting Policies - Gross and Net Book Value of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
Gross and net book value of property plant and equipment | ||
Property, plant and equipment, gross | $ 266,216 | $ 287,421 |
Property, plant and equipment, net | 105,148 | 118,120 |
MEXICO | ||
Gross and net book value of property plant and equipment | ||
Property, plant and equipment, gross | 146,690 | 157,551 |
Property, plant and equipment, net | $ 71,369 | $ 80,922 |
Organization and Summary of _15
Organization and Summary of Significant Accounting Policies - Schedule of Operating Lease Asset and Obligation Included in Condensed Consolidated Balance Sheet (Details) $ in Thousands | Jun. 28, 2020USD ($) |
Right-of-Use Asset Under Operating Lease: | |
Operating lease right-of-use asset | $ 3,753 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | us-gaap:OtherAssetsNoncurrent |
Lease Obligation Under Operating Lease: | |
Current Liabilities: Accrued Liabilities: Other | $ 354 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | us-gaap:OtherAccruedLiabilitiesCurrent |
Other Long-Term Liabilities | $ 3,399 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | us-gaap:OtherLiabilitiesNoncurrent |
Operating Lease, Liability | $ 3,753 |
Organization and Summary of _16
Organization and Summary of Significant Accounting Policies - Schedule of Future Minimum Lease Payments Under Non-Cancelable Lease Including Options to Extend (Details) $ in Thousands | Jun. 28, 2020USD ($) |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
2021 | $ 473 |
2022 | 484 |
2023 | 497 |
2024 | 509 |
Thereafter | 2,356 |
Total Future Minimum Lease Payments | 4,319 |
Less: Imputed Interest | (566) |
Total Lease Obligations | $ 3,753 |
Organization and Summary of _17
Organization and Summary of Significant Accounting Policies - Schedule of Future Minimum Lease Payments Under Non-Cancelable Lease Excluding Options to Extend Prior to Adoption (Details) $ in Thousands | Jun. 28, 2020USD ($) |
Leases [Abstract] | |
2020 | $ 539 |
2021 | 504 |
2022 | 495 |
2023 | 498 |
2024 | 168 |
Total Future Minimum Lease Payments | $ 2,204 |
Organization and Summary of _18
Organization and Summary of Significant Accounting Policies - Schedule of Cash Flow Information Related to Operating Lease (Details) $ in Thousands | 12 Months Ended |
Jun. 28, 2020USD ($) | |
Operating Cash Flows: | |
Cash Paid Related to Operating Lease Obligation | $ 461 |
Organization and Summary of _19
Organization and Summary of Significant Accounting Policies - Schedule of Weighted Average Lease Term and Discount Rate for Operating Lease (Details) | Jun. 28, 2020 |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Weighted Average Remaining Lease Term (in years) | 8 years 3 months 18 days |
Weighted Average Discount Rate | 3.30% |
Organization and Summary of _20
Organization and Summary of Significant Accounting Policies - Inventory Purchase from Major Suppliers (Details) - Supplier | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Supplier Concentrations | ||
Percentage of inventory purchases from major suppliers | 39.00% | 39.00% |
Number of major Suppliers | 7 | 7 |
Organization and Summary of _21
Organization and Summary of Significant Accounting Policies - Contract Liability Balances (Details) $ in Thousands | 12 Months Ended |
Jun. 28, 2020USD ($) | |
Revenue From Contract With Customer [Abstract] | |
Balance, June 30, 2019 | $ 932 |
Discounts Recorded as a Reduction in Sales | 1,048 |
Payments of Discounts to Customers | (915) |
Other | (692) |
Balance, June 28, 2020 | $ 373 |
Organization and Summary of _22
Organization and Summary of Significant Accounting Policies - Summary of Other Income (Expense), Net (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Other Income and Expenses [Abstract] | ||
Foreign currency transaction gain (loss) | $ 1,982 | $ (397) |
Rabbi Trust (loss) gain | (2) | 146 |
Unrealized (loss) gain on Mexican peso forward contracts | (480) | 39 |
Realized (loss) gain on Mexican peso forward contracts | (418) | 485 |
Pension and postretirement plans cost | (469) | (689) |
Other | 1,055 | 79 |
Other Income (Expense), net | $ 1,668 | $ (337) |
Organization and Summary of _23
Organization and Summary of Significant Accounting Policies - Changes in Warranty Reserve (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Changes in warranty reserve | ||
Balance, Beginning of Year | $ 7,900 | $ 7,800 |
Provision Charged to Expense | 823 | 559 |
Payments | 223 | 459 |
Balance, End of Year | $ 8,500 | $ 7,900 |
Organization and Summary of _24
Organization and Summary of Significant Accounting Policies - Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
Accumulated other comprehensive loss | ||
Unrecognized pension and postretirement benefit liabilities, net of tax | $ 1,977 | $ 2,251 |
Foreign currency translation, net of tax | 20,136 | 16,317 |
Accumulated other comprehensive loss, total | $ 22,113 | $ 18,568 |
Organization and Summary of _25
Organization and Summary of Significant Accounting Policies - Summary of Changes in Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Beginning balance | $ (187,816) | $ (183,246) |
Other comprehensive loss before reclassifications | 6,178 | 715 |
Other comprehensive loss before reclassifications, Income Tax | (363) | (30) |
Net other comprehensive loss before Reclassifications | 5,815 | 685 |
Reclassifications: | ||
Pension termination settlements | (25,668) | |
Prior service credits | 29 | 439 |
Actuarial losses | (412) | (1,262) |
Total reclassifications before tax | (383) | (26,491) |
Retirement and Postretirement Plans Reclassifications, Income Tax | 90 | 6,500 |
Net reclassifications | (293) | (19,991) |
Other Comprehensive (Income) Loss | 5,522 | (19,306) |
Reclassification of stranded tax effects | 4,047 | |
Ending balance | (175,441) | (187,816) |
Foreign Currency Translation Adjustments | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Beginning balance | 16,317 | 15,291 |
Other comprehensive loss before reclassifications | 6,153 | 545 |
Other comprehensive loss before reclassifications, Income Tax | (357) | 10 |
Net other comprehensive loss before Reclassifications | 5,796 | 555 |
Reclassifications: | ||
Other Comprehensive (Income) Loss | 5,796 | 555 |
Other comprehensive loss (income) attributable to non-controlling interest | 1,977 | (388) |
Reclassification of stranded tax effects | 83 | |
Ending balance | 20,136 | 16,317 |
Retirement and Postretirement Benefit Plans | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Beginning balance | 2,251 | 18,148 |
Other comprehensive loss before reclassifications | 25 | 170 |
Other comprehensive loss before reclassifications, Income Tax | (6) | (40) |
Net other comprehensive loss before Reclassifications | 19 | 130 |
Reclassifications: | ||
Pension termination settlements | (25,668) | |
Prior service credits | 29 | 439 |
Actuarial losses | (412) | (1,262) |
Total reclassifications before tax | (383) | (26,491) |
Retirement and Postretirement Plans Reclassifications, Income Tax | 90 | 6,500 |
Net reclassifications | (293) | (19,991) |
Other Comprehensive (Income) Loss | (274) | (19,861) |
Reclassification of stranded tax effects | 3,964 | |
Ending balance | 1,977 | 2,251 |
Accumulated Other Comprehensive Loss | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Beginning balance | 18,568 | 33,439 |
Reclassifications: | ||
Ending balance | 22,113 | 18,568 |
AOCI Including Portion Attributable to Noncontrolling Interest | ||
Reclassifications: | ||
Other Comprehensive (Income) Loss | 5,522 | (19,306) |
AOCI Attributable to Noncontrolling Interest | ||
Reclassifications: | ||
Other comprehensive loss (income) attributable to non-controlling interest | $ 1,977 | $ (388) |
Organization and Summary of _26
Organization and Summary of Significant Accounting Policies - Schedule of Unrecognized Compensation Cost (Details) - Restricted stock $ in Thousands | 12 Months Ended |
Jun. 28, 2020USD ($) | |
Unrecognized compensation cost related to restricted stock granted under the plan | |
Compensation Cost | $ 858 |
Weighted Average Period Over Which Cost is to be Recognized (in years) | 9 months 18 days |
Organization and Summary of _27
Organization and Summary of Significant Accounting Policies - Cash Received from Stock Option Exercises and Related Income Tax Benefit (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Cash Received From Stock Option Exercises And Related Income Tax Benefit | ||
Cash Received from Stock Option Exercises | $ 477 | $ 172 |
Income Tax Benefit | $ 28 | $ 76 |
Organization and Summary of _28
Organization and Summary of Significant Accounting Policies - Intrinsic Value of Stock Options Exercised and Fair Value Of Stock Options Vested (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Intrinsic value of stock options exercised and the fair value of stock options vested | ||
Intrinsic value of options exercised | $ 120 | $ 324 |
Organization and Summary of _29
Organization and Summary of Significant Accounting Policies - Range of Options Outstanding (Details) | 12 Months Ended |
Jun. 28, 2020$ / sharesshares | |
Range of options outstanding | |
Number of Options Outstanding | shares | 90,860 |
Number of Options Exercisable | shares | 90,860 |
Weighted Average Exercise Price Outstanding | $ 35.88 |
Weighted Average Exercise Price Exercisable | $ 35.88 |
Exercise Price Range One | |
Range of options outstanding | |
Number of Options Outstanding | shares | 49,660 |
Number of Options Exercisable | shares | 49,660 |
Weighted Average Exercise Price Outstanding | $ 26.10 |
Weighted Average Exercise Price Exercisable | $ 26.10 |
Weighted Average Remaining Contractual Life Outstanding (In Years) | 1 year 7 months 17 days |
Exercise Price Range, Lower Range Limit | $ 26.53 |
Exercise Price Range, Upper Range Limit | $ 25.64 |
Exercise Price Range Two | |
Range of options outstanding | |
Number of Options Outstanding | shares | 32,190 |
Number of Options Exercisable | shares | 32,190 |
Weighted Average Exercise Price Outstanding | $ 38.71 |
Weighted Average Exercise Price Exercisable | $ 38.71 |
Weighted Average Remaining Contractual Life Outstanding (In Years) | 3 years 1 month 20 days |
Exercise Price Range | $ 38.71 |
Exercise Price Range Three | |
Range of options outstanding | |
Number of Options Outstanding | shares | 9,010 |
Number of Options Exercisable | shares | 9,010 |
Weighted Average Exercise Price Outstanding | $ 79.73 |
Weighted Average Exercise Price Exercisable | $ 79.73 |
Weighted Average Remaining Contractual Life Outstanding (In Years) | 4 years 1 month 20 days |
Exercise Price Range | $ 79.73 |
Investment in Joint Ventures _3
Investment in Joint Ventures and Majority Owned Subsidiaries (Details Textual) - USD ($) | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Schedule Of Equity Method Investments [Line Items] | ||
Equity (loss) earnings of joint ventures | $ (209,000) | $ 2,783,000 |
Payments to acquire interest in joint venture | $ 200,000 | |
ADAC-STRATTEC LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
Percentage ownership interest in less than wholly owned consolidated subsidiary | 51.00% | 51.00% |
Income (loss) from majority owned subsidiaries, impact on net income | $ 1,500,000 | $ 2,700,000 |
STRATTEC POWER ACCESS LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
Percentage ownership interest in less than wholly owned consolidated subsidiary | 80.00% | 80.00% |
Income (loss) from majority owned subsidiaries, impact on net income | $ (1,300,000) | $ 2,500,000 |
VAST LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
Percentage ownership interest in equity method investment | 33.33% | |
Equity (loss) earnings of joint ventures | $ (565,000) | 2,655,000 |
Impairment change of equity method investment | 2,000,000 | |
Payments to acquire interest in joint venture | $ 0 | 600,000 |
VAST LLC | MINDA-VAST ACCESS SYSTEMS | ||
Schedule Of Equity Method Investments [Line Items] | ||
Percentage ownership interest in equity method investment | 50.00% | |
VAST LLC | STRATTEC | ||
Schedule Of Equity Method Investments [Line Items] | ||
Percentage ownership interest in equity method investment | 33.30% | |
Equity (loss) earnings of joint ventures | $ (565,000) | |
Impairment change of equity method investment | $ 667,000 | |
Payments to acquire interest in joint venture | 200,000 | |
SAL LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
Percentage ownership interest in equity method investment | 51.00% | |
Equity (loss) earnings of joint ventures | $ 356,000 | $ 128,000 |
Gain (loss) on dissolution | $ 342,000 | |
ADAC | ADAC-STRATTEC LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
Percentage ownership interest in less than wholly owned consolidated subsidiary | 49.00% | 49.00% |
Engineering, research, design and sales fee | $ 6,900,000 | $ 8,200,000 |
Outstanding payable balance | 658,000 | 1,500,000 |
Sales | 10,200,000 | 15,300,000 |
Outstanding receivable balance | $ 1,000,000 | $ 2,100,000 |
ADAC | VAST LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
Percentage ownership interest in equity method investment | 33.30% | |
WITTE | STRATTEC POWER ACCESS LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
Percentage ownership interest in less than wholly owned consolidated subsidiary | 20.00% | 20.00% |
Outstanding payable balance | $ 21,000 | $ 153,000 |
Purchases | $ 1,000,000 | $ 1,300,000 |
WITTE | VAST LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
Percentage ownership interest in equity method investment | 33.30% |
Investment in Joint Ventures _4
Investment in Joint Ventures and Majority Owned Subsidiaries - Schedule of Joint Venture Investments (Details) - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
Schedule Of Equity Method Investments [Line Items] | ||
Investment in VAST LLC | $ 22,068 | $ 23,528 |
VAST LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
Investment in VAST LLC | $ 22,068 | 23,528 |
SAL LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
Other Current Liabilities | $ 328 |
Equity (Loss) Earnings of Joi_3
Equity (Loss) Earnings of Joint Ventures (Details Textual) - USD ($) | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Schedule Of Equity Method Investments [Line Items] | ||
Equity (loss) earnings of joint ventures | $ (209,000) | $ 2,783,000 |
VAST LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
STRATTEC's percentage ownership in joint venture | 33.33% | |
Equity (loss) earnings of joint ventures | $ (565,000) | 2,655,000 |
SAL LLC | ||
Schedule Of Equity Method Investments [Line Items] | ||
STRATTEC's percentage ownership in joint venture | 51.00% | |
Equity (loss) earnings of joint ventures | $ 356,000 | $ 128,000 |
Equity (Loss) Earnings of Joi_4
Equity (Loss) Earnings of Joint Ventures - Summarized Statements of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Summarized statements of operations | ||
STRATTEC’s equity (loss) earnings of VAST LLC | $ (209) | $ 2,783 |
VAST LLC | ||
Summarized statements of operations | ||
Net sales | 153,006 | 161,660 |
Cost of goods sold | 125,012 | 128,375 |
Gross profit | 27,994 | 33,285 |
Engineering, selling and administrative expense | 28,812 | 27,624 |
Impairment charge | 2,000 | |
(Loss) income from operations | (2,818) | 5,661 |
Other income, net | 1,556 | 3,559 |
(Loss) income before provision for income taxes | (1,262) | 9,220 |
Provision for income taxes | 466 | 1,292 |
Net (loss) income | (1,728) | 7,928 |
STRATTEC’s share of VAST LLC Net (loss) Income | (576) | 2,643 |
Intercompany profit eliminations | 11 | 12 |
STRATTEC’s equity (loss) earnings of VAST LLC | $ (565) | $ 2,655 |
Equity (Loss) Earnings of Joi_5
Equity (Loss) Earnings of Joint Ventures - Summarized Statements Balance Sheet (Details) - VAST LLC - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
Summarized balance sheets | ||
Cash and cash equivalents | $ 8,549 | $ 6,854 |
Receivables, net | 40,983 | 35,639 |
Inventories, net | 22,285 | 20,465 |
Other current assets | 17,674 | 19,701 |
Total current assets | 89,491 | 82,659 |
Property, plant and equipment, net | 63,574 | 49,953 |
Other long-term assets | 14,387 | 16,868 |
Total assets | 167,452 | 149,480 |
Current debt | 13,072 | 7,240 |
Other current liabilities | 72,878 | 63,799 |
Long-term debt | 12,778 | 5,015 |
Other long-term liabilities | 2,228 | 2,512 |
Total liabilities | 100,956 | 78,566 |
Net assets | 66,496 | 70,914 |
STRATTEC’s share of VAST LLC net assets | $ 22,165 | $ 23,638 |
Equity (Loss) Earnings of Joi_6
Equity (Loss) Earnings of Joint Ventures - Summarize of Related Party Transaction (Details) - VAST LLC - Equity Method Investee - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Schedule Of Equity Method Investments [Line Items] | ||
Sales to VAST LLC | $ 4,041 | $ 3,731 |
Purchases from VAST LLC | 469 | 221 |
Expenses charged to VAST LLC | 2,299 | 1,594 |
Expenses charged from VAST LLC | 935 | 834 |
Accounts receivable from VAST LLC | 1,115 | 264 |
Accounts payable to VAST LLC | $ 239 | $ 127 |
Credit Facilities (Details Text
Credit Facilities (Details Textual) | 12 Months Ended |
Jun. 28, 2020USD ($) | |
STRATTEC Credit Facility | |
Line Of Credit Facility [Line Items] | |
Secured revolving credit facility | $ 40,000,000 |
Credit facility maturity date | Aug. 1, 2022 |
Interest rate on borrowings under the credit facility | the London Interbank Offering Rate (“LIBOR”) plus 1.0 percent or the bank’s prime rate. |
Interest rate - percentage points added to LIBOR - on borrowings under credit facility | 1.00% |
ADAC-STRATTEC Credit Facility | |
Line Of Credit Facility [Line Items] | |
Secured revolving credit facility | $ 25,000,000 |
Credit facility maturity date | Aug. 1, 2022 |
Interest rate on borrowings under the credit facility | LIBOR plus 1.25 percent or the bank’s prime rate. |
Interest rate - percentage points added to LIBOR - on borrowings under credit facility | 1.25% |
Credit Facilities - Schedule of
Credit Facilities - Schedule of Outstanding Borrowings Under the Credit Facilities (Details) - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
Line Of Credit Facility [Line Items] | ||
Outstanding Borrowing | $ 35,000 | $ 42,000 |
STRATTEC Credit Facility | ||
Line Of Credit Facility [Line Items] | ||
Outstanding Borrowing | 18,000 | 18,000 |
ADAC-STRATTEC Credit Facility | ||
Line Of Credit Facility [Line Items] | ||
Outstanding Borrowing | $ 17,000 | $ 24,000 |
Credit Facilities - Schedule _2
Credit Facilities - Schedule of Average Outstanding Borrowings and the Weighted Average Interest Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
STRATTEC Credit Facility | ||
Line Of Credit Facility [Line Items] | ||
Average Outstanding Borrowings | $ 13,827 | $ 21,212 |
Weighted Average Interest Rate | 2.60% | 3.30% |
ADAC-STRATTEC Credit Facility | ||
Line Of Credit Facility [Line Items] | ||
Average Outstanding Borrowings | $ 19,121 | $ 25,901 |
Weighted Average Interest Rate | 2.90% | 3.40% |
Commitments and Contingencies_2
Commitments and Contingencies (Details Textual) - USD ($) | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | ||
Cost incurred inception to date on installation and on-going monitoring of wells | $ 616,000 | |
Environmental | $ 1,259,000 | $ 1,278,000 |
Commitments and Contingencies -
Commitments and Contingencies - Purchase and Minimum Rental Commitments Under Non-Cancelable Operating Leases (Details) $ in Thousands | Jun. 28, 2020USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2021 | $ 473 |
2022 | 484 |
2023 | 497 |
2024 | 509 |
Minimum rental commitments, 2024-2025 | 2,356 |
Purchase commitments, 2020 | 9,545 |
Purchase commitments, 2021 | $ 4,183 |
Income Taxes - Provision (Benef
Income Taxes - Provision (Benefit) for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Currently (recoverable) payable: | ||
Federal | $ (1,869) | $ 705 |
State | (176) | 162 |
Foreign | 3,368 | 1,515 |
Total current income tax expense | 1,323 | 2,382 |
Deferred tax provision | (3,589) | (10,122) |
Total tax provision | $ (2,266) | $ (7,740) |
Income Taxes - Difference Betwe
Income Taxes - Difference Between Income Taxes Computed at the Federal Statutory Tax Rate and the Provision for Income Taxes (Details) | 12 Months Ended | ||
Jun. 28, 2020 | Jun. 30, 2019 | Dec. 31, 2017 | |
Difference between income taxes computed at the Federal statutory tax rate and the provision for income taxes | |||
U.S. statutory rate | 21.00% | 21.00% | 35.00% |
State taxes, net of Federal tax benefit | 2.10% | 3.70% | |
Foreign subsidiaries | (5.80%) | (1.80%) | |
U.S. tax reform: transition tax | 2.70% | ||
Federal net operating loss carry-back statutory rate differential | 11.70% | ||
Global intangible low-taxed income | (4.40%) | (0.70%) | |
Research and development tax credit | 9.90% | 9.40% | |
Non-controlling interest | (2.30%) | 6.70% | |
Uncertain tax positions | (4.00%) | (2.30%) | |
Stock based compensation | (1.80%) | (0.70%) | |
Other | 1.50% | (0.10%) | |
Total | 27.90% | 37.90% |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 12 Months Ended | |||
Jun. 28, 2020 | Jun. 30, 2019 | Dec. 31, 2017 | Jul. 01, 2018 | |
Income Tax [Line Items] | ||||
U.S. statutory rate | 21.00% | 21.00% | 35.00% | |
Federal operating loss and credit carry-forwards | $ 3,500,000 | |||
State operating loss and credit carry-forwards | 318,000 | |||
Valuation allowance | 189,000 | |||
Foreign income before income taxes | 7,700,000 | $ 4,000,000 | ||
Total liability for unrecognized tax benefits including interest | 1,600,000 | 1,200,000 | ||
Unrecognized tax benefits | 1,462,000 | 1,138,000 | $ 741,000 | |
Unrecognized tax benefits, accrued interest | 147,000 | 93,000 | ||
Unrecognized tax benefits, would effect tax rate | $ 1,100,000 | $ 854,000 | ||
Earliest Tax Year | Federal | ||||
Income Tax [Line Items] | ||||
Expiration year of operating loss and credit carry-forwards | 2033 | |||
Earliest Tax Year | State | ||||
Income Tax [Line Items] | ||||
Expiration year of operating loss and credit carry-forwards | 2025 | |||
Latest Tax Year | Federal | ||||
Income Tax [Line Items] | ||||
Expiration year of operating loss and credit carry-forwards | 2035 | |||
Latest Tax Year | State | ||||
Income Tax [Line Items] | ||||
Expiration year of operating loss and credit carry-forwards | 2035 |
Income Taxes - Components of De
Income Taxes - Components of Deferred Tax (Liabilities) Assets (Details) - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
Income Tax Disclosure [Abstract] | ||
Unrecognized pension and postretirement plan liabilities | $ 617 | $ 701 |
Accrued warranty | 517 | 446 |
Payroll-related accruals | 2,259 | 2,180 |
Stock-based compensation | 389 | 470 |
Inventory reserve | 964 | 834 |
Environmental reserve | 296 | 300 |
Repair and maintenance supply parts reserve | 510 | 229 |
Allowance for doubtful accounts | 118 | 118 |
Lease liability | 882 | |
Right of use assets | (882) | |
Credit carry-forwards | 3,860 | 1,990 |
Postretirement obligations | (357) | (416) |
Accumulated depreciation | (5,063) | (5,023) |
Accrued pension obligations | 472 | |
Accrued pension obligations | (1,578) | |
Non-cash compensation expense | 986 | |
Joint ventures | 1,167 | 968 |
Other | 741 | 728 |
Deferred tax assets, net | $ 6,490 | $ 2,933 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Reconciliation of the beginning and ending amount of unrecognized tax benefits | ||
Unrecognized tax benefits, beginning of year | $ 1,138 | $ 741 |
Gross increases – tax positions in prior years | 140 | 229 |
Gross increases – current period tax positions | 245 | 238 |
Tax years closed | (61) | (70) |
Unrecognized tax benefits, end of year | $ 1,462 | $ 1,138 |
Retirement Plans and Postreti_3
Retirement Plans and Postretirement Costs (Details Textual) - USD ($) | 12 Months Ended | ||
Jun. 28, 2020 | Jun. 30, 2019 | Jul. 01, 2018 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Date the Board of Directors freeze benefit accruals and future eligibility under the Qualified Pension Plan | Dec. 31, 2009 | ||
Termination of Qualified Pension Plan, description | The Board of Directors has subsequently approved to proceed with the termination of the Qualified Pension Plan. During the quarter ended December 30, 2018, we completed a substantial portion of terminating the Qualified Pension Plan. In connection with the termination of the Qualified Pension Plan, distributions from the Qualified Pension Plan trust were made during the three month period ended December 30, 2018 to participants who elected lump-sum distributions. Additionally, during the three months ended December 30, 2018, we entered into an agreement with an insurance company to purchase from us, through a series of annuity contracts, our remaining obligations under the Qualified Pension Plan and, as a result, we settled the remaining obligations under the plan for the remaining participants utilizing funds available in the Qualified Pension Plan trust. | ||
Additional contributions for termination of Qualified Pension Plan | $ 0 | ||
Non-cash pre-tax settlement charge | $ 31,878,000 | ||
Non-cash compensation expense | 4,824,000 | 4,195,000 | |
Rabbi Trust Assets - SERP | 2,900,000 | $ 2,900,000 | |
Postretirement plan annual benefit limit for future eligible retirees | $ 4,000 | ||
Other postretirement benefits maximum benefit period | 5 years | ||
Fair value of pension plan assets | $ 0 | ||
Health care cost trend rate for next fiscal year | 6.71% | ||
Ultimate health care cost trend rate | 3.00% | ||
401(K) Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Percent of each dollar of eligible employee contributions matched by employer | 100.00% | ||
Employer matching contribution to employee up to participant's eligible contribution | 5.00% | ||
Cash and Cash Equivalents | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Qualified pension plan weighted-average asset allocation, percentage | 100.00% | ||
Cash and Cash Equivalents | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of pension plan assets | $ 8,600,000 | ||
Other Current Assets | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Rabbi Trust Assets - SERP | $ 217,000 | ||
Other Long-Term Assets | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Rabbi Trust Assets - SERP | $ 2,700,000 | ||
Supplemental Employee Retirement Plan, Defined Benefit | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Percentage of participant's base salary received as Supplemental Retirement Benefits | 8.00% | ||
Vesting period, SERP | 5 years | ||
Projected benefit obligation | $ 2,293,000 | 2,169,000 | |
Expected employer contributions in next fiscal year | 1,000,000 | ||
Postretirement Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Projected benefit obligation | 821,000 | $ 914,000 | $ 1,041,000 |
Expected employer contributions in next fiscal year | $ 119,000 |
Retirement Plans and Postreti_4
Retirement Plans and Postretirement Costs - Amounts Included in Accumulated Other Comprehensive Loss, Net of Tax (Details) - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
Amounts Included in Accumulated Other Comprehensive Loss, Net of Tax | ||
Total | $ 1,977 | $ 2,251 |
SERP | ||
Amounts Included in Accumulated Other Comprehensive Loss, Net of Tax | ||
Net actuarial loss | 215 | |
Total | 215 | |
Postretirement | ||
Amounts Included in Accumulated Other Comprehensive Loss, Net of Tax | ||
Prior service credit | (6) | |
Net actuarial loss | 1,768 | |
Total | $ 1,762 |
Retirement Plans and Postreti_5
Retirement Plans and Postretirement Costs - Amounts Included in Accumulated Other Comprehensive Loss Expected to be Recognized, Net of Tax (Details) $ in Thousands | Jun. 28, 2020USD ($) |
SERP | |
Amounts Included in Accumulated Other Comprehensive Loss, Net of Tax | |
Net actuarial loss | $ 8 |
Total | 8 |
Postretirement | |
Amounts Included in Accumulated Other Comprehensive Loss, Net of Tax | |
Prior service credit | (6) |
Net actuarial loss | 274 |
Total | $ 268 |
Retirement Plans and Postreti_6
Retirement Plans and Postretirement Costs - Summary of Pension Supplemental Executive Retirement Plan and Postretirement Plans Income and Expense (Details) - USD ($) | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
COMPONENTS OF NET PERIODIC BENEFIT COST: | ||
Plan settlements | $ 31,878,000 | |
CHANGE IN PLAN ASSETS: | ||
Fair value of plan assets at end of year | $ 0 | |
CHANGES IN PLAN ASSETS AND BENEFIT OBLIGATIONS RECOGNIZED IN OTHER COMPREHENSIVE INCOME: | ||
Amortization of prior service credits | 29,000 | 439,000 |
Amortization of unrecognized net loss | (412,000) | (1,262,000) |
Pension and SERP Benefits | ||
COMPONENTS OF NET PERIODIC BENEFIT COST: | ||
Service cost | 74,000 | 62,000 |
Interest cost | 61,000 | 2,101,000 |
Expected return on plan assets | (2,275,000) | |
Plan settlements | 31,878,000 | |
Amortization of unrecognized net loss | 15,000 | 831,000 |
Net periodic benefit cost (credit) | $ 150,000 | $ 32,597,000 |
Benefit Obligations: | ||
Benefit Obligations, Discount rate | 2.33% | 3.17% |
Benefit Obligations, Rate of compensation increases - SERP | 3.00% | 3.00% |
Net Periodic Benefit Cost: | ||
Net Periodic Benefit Cost, Discount rate | 3.17% | 4.30% |
Net Periodic Benefit Cost, Rate of compensation increases - SERP | 3.00% | 3.00% |
CHANGE IN PROJECTED BENEFIT OBLIGATION: | ||
Benefit obligation at beginning of year | $ 2,229,000 | $ 98,835,000 |
Service cost | 74,000 | 62,000 |
Interest cost | 61,000 | 2,101,000 |
Plan settlements | (72,400,000) | |
Actuarial gain | 3,000 | 5,143,000 |
Benefits paid | (74,000) | (31,512,000) |
Benefit obligation at end of year | 2,293,000 | 2,229,000 |
CHANGE IN PLAN ASSETS: | ||
Fair value of plan assets at beginning of year | 8,645,000 | 111,466,000 |
Actual return on plan assets | 84,000 | 1,077,000 |
Employer contribution | 14,000 | 14,000 |
Excess Asset Transfer | (9,019,000) | |
Plan settlements | 350,000 | (72,400,000) |
Benefits paid | (74,000) | (31,512,000) |
Fair value of plan assets at end of year | 8,645,000 | |
Funded status – (accrued) prepaid benefit obligations | (2,293,000) | 6,416,000 |
AMOUNTS RECOGNIZED IN CONSOLIDATED BALANCE SHEETS: | ||
Other long-term assets | 8,585,000 | |
Accrued payroll and benefits (current liabilities) | (1,039,000) | (506,000) |
Accrued benefit obligations (long-term liabilities) | (1,254,000) | (1,663,000) |
Net amount recognized | (2,293,000) | 6,416,000 |
CHANGES IN PLAN ASSETS AND BENEFIT OBLIGATIONS RECOGNIZED IN OTHER COMPREHENSIVE INCOME: | ||
Net periodic benefit cost | 150,000 | 32,597,000 |
Net actuarial loss (gain) | 3,000 | (57,414,000) |
Plan settlements | 31,878,000 | |
Amortization of unrecognized net loss | (15,000) | (831,000) |
Total recognized in other comprehensive (income) loss, before tax | (12,000) | (26,367,000) |
Total recognized in net periodic benefit cost and other comprehensive loss, before tax | 138,000 | 6,230,000 |
Postretirement Benefits | ||
COMPONENTS OF NET PERIODIC BENEFIT COST: | ||
Service cost | 12,000 | 11,000 |
Interest cost | 26,000 | 40,000 |
Amortization of prior service cost (credit) | (29,000) | (439,000) |
Amortization of unrecognized net loss | 397,000 | 431,000 |
Net periodic benefit cost (credit) | $ 406,000 | $ 43,000 |
Benefit Obligations: | ||
Benefit Obligations, Discount rate | 2.07% | 3.01% |
Net Periodic Benefit Cost: | ||
Net Periodic Benefit Cost, Discount rate | 3.01% | 4.30% |
CHANGE IN PROJECTED BENEFIT OBLIGATION: | ||
Benefit obligation at beginning of year | $ 914,000 | $ 1,041,000 |
Service cost | 12,000 | 11,000 |
Interest cost | 26,000 | 40,000 |
Actuarial gain | 22,000 | 39,000 |
Benefits paid | (153,000) | (217,000) |
Benefit obligation at end of year | 821,000 | 914,000 |
CHANGE IN PLAN ASSETS: | ||
Employer contribution | 153,000 | 217,000 |
Benefits paid | (153,000) | (217,000) |
Funded status – (accrued) prepaid benefit obligations | (821,000) | (914,000) |
AMOUNTS RECOGNIZED IN CONSOLIDATED BALANCE SHEETS: | ||
Accrued payroll and benefits (current liabilities) | (120,000) | (152,000) |
Accrued benefit obligations (long-term liabilities) | (701,000) | (762,000) |
Net amount recognized | (821,000) | (914,000) |
CHANGES IN PLAN ASSETS AND BENEFIT OBLIGATIONS RECOGNIZED IN OTHER COMPREHENSIVE INCOME: | ||
Net periodic benefit cost | 406,000 | 43,000 |
Net actuarial loss (gain) | 22,000 | 39,000 |
Amortization of prior service credits | 29,000 | 439,000 |
Amortization of unrecognized net loss | (397,000) | (431,000) |
Total recognized in other comprehensive (income) loss, before tax | (346,000) | 47,000 |
Total recognized in net periodic benefit cost and other comprehensive loss, before tax | $ 60,000 | $ 90,000 |
Retirement Plans and Postreti_7
Retirement Plans and Postretirement Costs - The Accumulated Benefit Obligations and Projected Benefit Obligations for the Pension and SERP (Details) - USD ($) $ in Thousands | Jun. 28, 2020 | Jun. 30, 2019 |
Pension | ||
Accumulated Benefit Obligations and Projected Benefit Obligations | ||
Accumulated benefit obligation | $ 60 | |
Projected benefit obligation | 60 | |
SERP | ||
Accumulated Benefit Obligations and Projected Benefit Obligations | ||
Accumulated benefit obligation | $ 2,176 | 1,981 |
Projected benefit obligation | $ 2,293 | $ 2,169 |
Retirement Plans and Postreti_8
Retirement Plans and Postretirement Costs - Minimal Effect of Health Care Trend on our Postretirement Benefit (Details) $ in Thousands | 12 Months Ended |
Jun. 28, 2020USD ($) | |
Significant Effect of Health Care Trend on the Postretirement Benefit | |
Effect on postretirement benefit obligation as of July 1, 2018, 1% Increase | $ 3 |
Effect on postretirement benefit obligation as of July 1, 2018, 1% Decrease | $ (3) |
Retirement Plans and Postreti_9
Retirement Plans and Postretirement Costs - Expected Future Benefit Payments (Details) $ in Thousands | Jun. 28, 2020USD ($) |
SERP | |
Expected future benefit payments | |
2021 | $ 1,040 |
2022 | 402 |
2023 | 14 |
2024 | 14 |
2025 | 14 |
2026-2030 | 928 |
Postretirement Benefits | |
Expected future benefit payments | |
2021 | 119 |
2022 | 116 |
2023 | 103 |
2024 | 93 |
2025 | 64 |
2026-2030 | $ 218 |
Retirement Plans and Postret_10
Retirement Plans and Postretirement Costs - Schedule of 401(k) Plan Contribution (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Compensation And Retirement Disclosure [Abstract] | ||
Employer contribution defined contribution plan | $ 1,709 | $ 1,903 |
Shareholders' Equity (Details T
Shareholders' Equity (Details Textual) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Equity [Abstract] | ||
Common stock, shares authorized | 12,000,000 | 12,000,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares outstanding | 3,749,619 | 3,691,555 |
Number of shares authorized to be repurchased | 3,839,395 | |
Number of shares repurchased to date | 3,655,322 | |
Cost of shares repurchased to date | $ 136.4 | |
Number of shares repurchased during period | 0 | 0 |
Loss Per Share - Reconciliation
Loss Per Share - Reconciliation of the Components of Basic and Diluted Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Jun. 28, 2020 | Mar. 29, 2020 | Dec. 29, 2019 | Sep. 29, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 30, 2018 | Sep. 30, 2018 | Jun. 28, 2020 | Jun. 30, 2019 | |
Reconciliation of the components of the basic and diluted per share | ||||||||||
Net loss attributable to STRATTEC | $ (10,502) | $ 2,994 | $ (1,341) | $ 1,244 | $ (62) | $ 1,730 | $ (22,164) | $ 3,467 | $ (7,605) | $ (17,029) |
Weighted average shares of common stock outstanding | 3,737 | 3,676 | ||||||||
Diluted weighted average shares of common stock Outstanding | 3,737 | 3,676 | ||||||||
Basic loss per share | $ (2.80) | $ 0.80 | $ (0.36) | $ 0.34 | $ (0.02) | $ 0.47 | $ (6.03) | $ 0.95 | $ (2.04) | $ (4.63) |
Diluted loss per share | $ (2.80) | $ 0.79 | $ (0.36) | $ 0.33 | $ (0.02) | $ 0.46 | $ (5.96) | $ 0.93 | $ (2.04) | $ (4.63) |
Loss Per Share - Schedule of An
Loss Per Share - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Earnings Per Share [Abstract] | ||
Antidilutive shares excluded from earnings per share computation | 160,254 | 181,117 |
Stock Option and Purchase Pla_3
Stock Option and Purchase Plans - Summary of Stock Option Activity Under Our Stock Incentive Plan (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Share Based Compensation [Abstract] | ||
Shares, Beginning Balance | 117,360 | 133,074 |
Shares, Exercised | (26,500) | (15,714) |
Shares, Ending Balance | 90,860 | 117,360 |
Shares, Exercisable | 90,860 | 117,360 |
Weighted Average Exercise Price, Beginning Balance | $ 31.85 | $ 29.37 |
Weighted Average Exercise Price, Exercised | 18 | 10.92 |
Weighted Average Exercise Price, Ending Balance | 35.88 | 31.85 |
Weighted Average Exercise Price, Exercisable | $ 35.88 | $ 31.85 |
Weighted Average Remaining Contractual Term, Outstanding | 2 years 4 months 24 days | |
Weighted Average Remaining Contractual Term, Exercisable | 2 years 4 months 24 days | 2 years 8 months 12 days |
Aggregate Intrinsic Value, Exercisable | $ 162 |
Stock Option and Purchase Pla_4
Stock Option and Purchase Plans (Details Textual) - USD ($) | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Options, granted | 0 | 0 |
Employee Stock Purchase Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Maximum Contribution per participant per calendar year | $ 5,200 | |
Maximum number of shares authorized for issuance from treasury under the Employee Stock Purchase Plan | 100,000 | |
Employee stock purchase plan average price of shares purchased during period | $ 19.42 | $ 30.13 |
Shares available for issuance from treasury under the Employee Stock Purchase plan | 53,871 | |
Employee Stock Purchase Plan | Treasury Stock | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Shares issued under stock purchase plan | 4,246 | 3,295 |
Stock Option and Purchase Pla_5
Stock Option and Purchase Plans - Summary of Restricted Stock Activity Under Our Stock Incentive Plan (Details) - Restricted stock - $ / shares | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Nonvested, Shares Beginning Balance | 63,757 | 69,125 |
Granted, Shares | 39,150 | 34,050 |
Vested, Shares | (27,318) | (37,343) |
Forfeited, Shares | (6,195) | (2,075) |
Nonvested, Shares Ending Balance | 69,394 | 63,757 |
Nonvested, Weighted Average Grant Date Fair Value Beginning Balance | $ 39.47 | $ 49.02 |
Granted, Weighted Average Grant Date Fair Value | 21.80 | 37.25 |
Vested, Weighted Average Grant Date Fair Value | 37.86 | 54.93 |
Forfeited, Weighted Average Grant Date Fair Value | 34.38 | 43.52 |
Nonvested, Weighted Average Grant Date Fair Value Ending Balance | $ 30.59 | $ 39.47 |
Export Sales - Schedule of Sale
Export Sales - Schedule of Sales to Locations Outside of the United States (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Jun. 28, 2020 | Mar. 29, 2020 | Dec. 29, 2019 | Sep. 29, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 30, 2018 | Sep. 30, 2018 | Jun. 28, 2020 | Jun. 30, 2019 | |
Concentration Risk [Line Items] | ||||||||||
Net Sales | $ 42,117 | $ 116,938 | $ 106,283 | $ 119,962 | $ 128,704 | $ 128,230 | $ 112,913 | $ 117,159 | $ 385,300 | $ 487,006 |
Export Sales | ||||||||||
Concentration Risk [Line Items] | ||||||||||
Net Sales | $ 114,381 | $ 160,771 | ||||||||
Export Sales | Sales Revenue Net | Geographic Concentration Risk | ||||||||||
Concentration Risk [Line Items] | ||||||||||
Percentage of Export Sales | 30.00% | 33.00% | ||||||||
Canada | Geographic Concentration Risk | ||||||||||
Concentration Risk [Line Items] | ||||||||||
Net Sales | $ 46,191 | $ 67,516 | ||||||||
Canada | Sales Revenue Net | Geographic Concentration Risk | ||||||||||
Concentration Risk [Line Items] | ||||||||||
Percentage of Export Sales | 12.00% | 14.00% |
Product Sales - Schedule of Pro
Product Sales - Schedule of Product Sales (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Jun. 28, 2020 | Mar. 29, 2020 | Dec. 29, 2019 | Sep. 29, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 30, 2018 | Sep. 30, 2018 | Jun. 28, 2020 | Jun. 30, 2019 | |
Product Information [Line Items] | ||||||||||
Net Sales | $ 42,117 | $ 116,938 | $ 106,283 | $ 119,962 | $ 128,704 | $ 128,230 | $ 112,913 | $ 117,159 | $ 385,300 | $ 487,006 |
Sales | Product Concentration Risk | ||||||||||
Product Information [Line Items] | ||||||||||
Percentage of Net Sales | 100.00% | 100.00% | ||||||||
Keys & Locksets | ||||||||||
Product Information [Line Items] | ||||||||||
Net Sales | $ 101,666 | $ 135,413 | ||||||||
Keys & Locksets | Sales | Product Concentration Risk | ||||||||||
Product Information [Line Items] | ||||||||||
Percentage of Net Sales | 26.00% | 28.00% | ||||||||
Door Handles & Exterior Trim | ||||||||||
Product Information [Line Items] | ||||||||||
Net Sales | $ 98,168 | $ 116,977 | ||||||||
Door Handles & Exterior Trim | Sales | Product Concentration Risk | ||||||||||
Product Information [Line Items] | ||||||||||
Percentage of Net Sales | 25.00% | 24.00% | ||||||||
Power Access | ||||||||||
Product Information [Line Items] | ||||||||||
Net Sales | $ 63,829 | $ 92,744 | ||||||||
Power Access | Sales | Product Concentration Risk | ||||||||||
Product Information [Line Items] | ||||||||||
Percentage of Net Sales | 17.00% | 19.00% | ||||||||
Latches | ||||||||||
Product Information [Line Items] | ||||||||||
Net Sales | $ 45,295 | $ 49,147 | ||||||||
Latches | Sales | Product Concentration Risk | ||||||||||
Product Information [Line Items] | ||||||||||
Percentage of Net Sales | 12.00% | 10.00% | ||||||||
Aftermarket & OE Service | ||||||||||
Product Information [Line Items] | ||||||||||
Net Sales | $ 40,742 | $ 44,254 | ||||||||
Aftermarket & OE Service | Sales | Product Concentration Risk | ||||||||||
Product Information [Line Items] | ||||||||||
Percentage of Net Sales | 11.00% | 9.00% | ||||||||
Driver Controls | ||||||||||
Product Information [Line Items] | ||||||||||
Net Sales | $ 29,649 | $ 40,942 | ||||||||
Driver Controls | Sales | Product Concentration Risk | ||||||||||
Product Information [Line Items] | ||||||||||
Percentage of Net Sales | 8.00% | 8.00% | ||||||||
Other | ||||||||||
Product Information [Line Items] | ||||||||||
Net Sales | $ 5,951 | $ 7,529 | ||||||||
Other | Sales | Product Concentration Risk | ||||||||||
Product Information [Line Items] | ||||||||||
Percentage of Net Sales | 1.00% | 2.00% |
Sales and Receivable Concentr_3
Sales and Receivable Concentration - Sales to Largest Customers (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Jun. 28, 2020 | Mar. 29, 2020 | Dec. 29, 2019 | Sep. 29, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 30, 2018 | Sep. 30, 2018 | Jun. 28, 2020 | Jun. 30, 2019 | |
Sales to largest customers | ||||||||||
Net Sales | $ 42,117 | $ 116,938 | $ 106,283 | $ 119,962 | $ 128,704 | $ 128,230 | $ 112,913 | $ 117,159 | $ 385,300 | $ 487,006 |
Customer Concentration Risk | ||||||||||
Sales to largest customers | ||||||||||
Net Sales | $ 240,163 | $ 291,356 | ||||||||
Customer Concentration Risk | Sales Revenue Net | ||||||||||
Sales to largest customers | ||||||||||
Percentage of Net Sales | 62.00% | 60.00% | ||||||||
Fiat Chrysler Automobiles | Customer Concentration Risk | ||||||||||
Sales to largest customers | ||||||||||
Net Sales | $ 85,010 | $ 115,304 | ||||||||
Fiat Chrysler Automobiles | Customer Concentration Risk | Sales Revenue Net | ||||||||||
Sales to largest customers | ||||||||||
Percentage of Net Sales | 22.00% | 24.00% | ||||||||
General Motors Company | Customer Concentration Risk | ||||||||||
Sales to largest customers | ||||||||||
Net Sales | $ 102,487 | $ 112,719 | ||||||||
General Motors Company | Customer Concentration Risk | Sales Revenue Net | ||||||||||
Sales to largest customers | ||||||||||
Percentage of Net Sales | 27.00% | 23.00% | ||||||||
Ford Motor Company | Customer Concentration Risk | ||||||||||
Sales to largest customers | ||||||||||
Net Sales | $ 52,666 | $ 63,333 | ||||||||
Ford Motor Company | Customer Concentration Risk | Sales Revenue Net | ||||||||||
Sales to largest customers | ||||||||||
Percentage of Net Sales | 13.00% | 13.00% |
Sales and Receivable Concentr_4
Sales and Receivable Concentration - Receivables from Largest Customers (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 28, 2020 | Jun. 30, 2019 | |
Receivables from largest customers | ||
Receivables | $ 41,955 | $ 84,230 |
Customer Concentration Risk | ||
Receivables from largest customers | ||
Receivables | $ 24,612 | $ 41,896 |
Customer Concentration Risk | Accounts Receivable | ||
Receivables from largest customers | ||
Percentage of Gross Receivables | 59.00% | 50.00% |
Fiat Chrysler Automobiles | Customer Concentration Risk | ||
Receivables from largest customers | ||
Receivables | $ 5,881 | $ 19,151 |
Fiat Chrysler Automobiles | Customer Concentration Risk | Accounts Receivable | ||
Receivables from largest customers | ||
Percentage of Gross Receivables | 14.00% | 23.00% |
General Motors Company | Customer Concentration Risk | ||
Receivables from largest customers | ||
Receivables | $ 12,630 | $ 12,754 |
General Motors Company | Customer Concentration Risk | Accounts Receivable | ||
Receivables from largest customers | ||
Percentage of Gross Receivables | 30.00% | 15.00% |
Ford Motor Company | Customer Concentration Risk | ||
Receivables from largest customers | ||
Receivables | $ 6,101 | $ 9,991 |
Ford Motor Company | Customer Concentration Risk | Accounts Receivable | ||
Receivables from largest customers | ||
Percentage of Gross Receivables | 15.00% | 12.00% |
Selected Quarterly Financial _3
Selected Quarterly Financial Data (unaudited) - Summary of Selected Quarterly Financial Data (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Jun. 28, 2020 | Mar. 29, 2020 | Dec. 29, 2019 | Sep. 29, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 30, 2018 | Sep. 30, 2018 | Jun. 28, 2020 | Jun. 30, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | ||||||||||
Net Sales | $ 42,117 | $ 116,938 | $ 106,283 | $ 119,962 | $ 128,704 | $ 128,230 | $ 112,913 | $ 117,159 | $ 385,300 | $ 487,006 |
Gross Profit | (7,783) | 17,010 | 10,333 | 15,886 | 14,199 | 15,682 | 12,736 | 15,183 | 35,446 | 57,800 |
Net Income (Loss) Attributable to STRATTEC | $ (10,502) | $ 2,994 | $ (1,341) | $ 1,244 | $ (62) | $ 1,730 | $ (22,164) | $ 3,467 | $ (7,605) | $ (17,029) |
Basic | $ (2.80) | $ 0.80 | $ (0.36) | $ 0.34 | $ (0.02) | $ 0.47 | $ (6.03) | $ 0.95 | $ (2.04) | $ (4.63) |
Diluted | $ (2.80) | $ 0.79 | $ (0.36) | $ 0.33 | $ (0.02) | $ 0.46 | $ (5.96) | $ 0.93 | $ (2.04) | $ (4.63) |