Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 24, 2019 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | BARNES GROUP INC | |
Entity Central Index Key | 0000009984 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 51,384,304 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Income Statement [Abstract] | ||
Net sales | $ 376,692 | $ 366,660 |
Cost of sales | 244,643 | 237,134 |
Selling and administrative expenses | 81,400 | 72,893 |
Total operating costs and expenses | 326,043 | 310,027 |
Operating income | 50,649 | 56,633 |
Interest expense | 5,113 | 3,892 |
Other expense (income), net | 1,806 | 1,763 |
Income before income taxes | 43,730 | 50,978 |
Income taxes | 9,738 | 12,160 |
Net income | $ 33,992 | $ 38,818 |
Per common share: | ||
Basic (in dollars per share) | $ 0.66 | $ 0.73 |
Diluted (in dollars per share) | $ 0.65 | $ 0.72 |
Weighted average common shares outstanding: | ||
Basic (in shares) | 51,660,804 | 53,535,424 |
Diluted (in shares) | 52,189,465 | 54,089,327 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 33,992 | $ 38,818 | |
Other comprehensive (loss) income, net of tax | |||
Unrealized (loss) gain on hedging activities, net of tax (1) | [1] | (568) | 396 |
Foreign currency translation adjustments, net of tax (2) | [2] | (9,225) | 26,953 |
Defined benefit pension and other postretirement benefits, net of tax (3) | [3] | 1,615 | 3,164 |
Total other comprehensive (loss) income, net of tax | (8,178) | 30,513 | |
Total comprehensive income | 25,814 | 69,331 | |
Unrealized (loss) gain on hedging activities, tax | (175) | 148 | |
Foreign currency translation adjustment, tax | (100) | 162 | |
Defined benefit pension and other postretirement benefits, tax | $ 540 | $ 1,257 | |
[1] | Net of tax of $(175) and $148 for the three months ended March 31, 2019 and 2018, respectively. | ||
[2] | Net of tax of $(100) and $162 for the three months ended March 31, 2019 and 2018, respectively. | ||
[3] | Net of tax of $540 and $1,257 for the three months ended March 31, 2019 and 2018, respectively. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Current assets | ||
Cash and cash equivalents | $ 103,507 | $ 100,719 |
Accounts receivable, less allowances (2019 - $4,957; 2018 - $5,010) | 377,826 | 382,253 |
Inventories | 257,249 | 265,990 |
Prepaid expenses and other current assets | 58,839 | 57,184 |
Prepaid expenses and other current assets | (2,670) | |
Total current assets | 797,421 | 806,146 |
Deferred income taxes | 19,609 | 20,474 |
Property, plant and equipment | 856,661 | 853,497 |
Less accumulated depreciation | (488,790) | (482,966) |
Property, plant and equipment, net | 367,871 | 370,531 |
Goodwill | 944,809 | 955,524 |
Other intangible assets, net | 617,562 | 636,538 |
Other assets | 52,403 | 19,757 |
Total assets | 2,799,675 | 2,808,970 |
Current liabilities | ||
Notes and overdrafts payable | 23,051 | 2,137 |
Accounts payable | 132,329 | 143,419 |
Accrued liabilities | 208,420 | 206,782 |
Long-term debt - current | 5,231 | 5,522 |
Total current liabilities | 369,031 | 357,860 |
Long-term debt | 877,540 | 936,357 |
Accrued retirement benefits | 102,061 | 104,302 |
Deferred income taxes | 103,366 | 106,559 |
Long-term tax liability | 72,961 | 72,961 |
Other liabilities | 50,213 | 27,875 |
Commitments and contingencies (Note 17) | ||
Stockholders' equity | ||
Common stock - par value $0.01 per share Authorized: 150,000,000 shares Issued: at par value (2019 - 63,417,803 shares; 2018 - 63,367,133 shares) | 634 | 634 |
Additional paid-in capital | 474,857 | 470,818 |
Treasury stock, at cost (2019 - 12,034,986 shares; 2018 - 12,033,580 shares) | (441,748) | (441,668) |
Retained earnings | 1,389,438 | 1,363,772 |
Accumulated other non-owner changes to equity | (198,678) | (190,500) |
Total stockholders' equity | 1,224,503 | 1,203,056 |
Total liabilities and stockholders' equity | $ 2,799,675 | $ 2,808,970 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 4,957 | $ 5,010 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 150,000,000 | 150,000,000 |
Common stock, shares issued (in shares) | 63,417,803 | 63,367,133 |
Treasury stock, at cost (in shares) | 12,034,986 | 12,033,580 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Operating activities: | ||
Net income | $ 33,992 | $ 38,818 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 25,100 | 23,677 |
Loss (gain) on disposition of property, plant and equipment | 91 | (158) |
Stock compensation expense | 3,021 | 2,501 |
Changes in assets and liabilities: | ||
Accounts receivable | 4,345 | (26,841) |
Inventories | 7,300 | (13,920) |
Prepaid expenses and other current assets | (2,670) | (6,028) |
Accounts payable | (9,179) | 4,488 |
Accrued liabilities | (4,708) | 10,494 |
Deferred income taxes | (872) | (66) |
Long-term retirement benefits | (3,428) | (2,213) |
Other | 68 | (269) |
Net cash provided by operating activities | 53,060 | 30,483 |
Investing activities: | ||
Proceeds from disposition of property, plant and equipment | 322 | 552 |
Capital expenditures | (13,738) | (11,210) |
Other | 0 | (1,000) |
Net cash used by investing activities | (13,416) | (11,658) |
Financing activities: | ||
Net change in other borrowings | 20,903 | 9,169 |
Payments on long-term debt | (152,195) | (111,845) |
Proceeds from the issuance of long-term debt | 102,990 | 87,500 |
Proceeds from the issuance of common stock | 986 | 317 |
Common stock repurchases | 0 | (33,541) |
Dividends paid | (8,217) | (7,453) |
Withholding taxes paid on stock issuances | (80) | (68) |
Other | (1,340) | (6,546) |
Net cash used by financing activities | (36,953) | (62,467) |
Effect of exchange rate changes on cash flows | 97 | 3,053 |
Increase (decrease) in cash and cash equivalents | 2,788 | (40,589) |
Cash and cash equivalents at beginning of period | 100,719 | 145,290 |
Cash and cash equivalents at end of period | $ 103,507 | $ 104,701 |
Basis of Presentation (Notes)
Basis of Presentation (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated balance sheet and the related unaudited consolidated statements of income, comprehensive income and cash flows have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The consolidated financial statements do not include all information and notes required by accounting principles generally accepted in the United States of America for complete financial statements. The balance sheet as of December 31, 2018 has been derived from the 2018 financial statements of Barnes Group Inc. (the “Company”). For additional information, please refer to the consolidated financial statements and notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2018 . In the opinion of management, all adjustments, including normal recurring accruals considered necessary for a fair statement of the results, have been included. Operating results for the three -month period ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019 . Certain reclassifications have been made to prior year amounts to conform to current year presentation. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions In the third quarter of 2018, the Company acquired Industrial Gas Springs Group Holdings Limited (“IGS”) and in the fourth quarter of 2018, the Company acquired Gimatic S.r.l ("Gimatic"). The following table reflects the unaudited pro forma operating results of the Company for the three months ended March 31, 2018, which give effect to the acquisitions of Gimatic and IGS as if they had occurred on January 1, 2017. The pro forma results are based on assumptions that the Company believes are reasonable under the circumstances. The pro forma results are not necessarily indicative of the operating results that would have occurred if the acquisitions had been effective January 1, 2017, nor are they intended to be indicative of results that may occur in the future. The underlying pro forma information includes the historical financial results of the Company and the acquired entities adjusted for certain items including amortization expense associated with the assets acquired and the Company’s expense related to financing arrangements, with the related tax effects. The pro forma information does not include the effects of any synergies or cost reduction initiatives related to the acquisitions. (Unaudited Pro Forma) Three Months Ended Net Sales $ 386,562 Net Income 37,294 |
Recent Accounting Standards
Recent Accounting Standards | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Standards | Recent Accounting Standards The Financial Accounting Standards Board ("FASB") establishes changes to accounting principles under U.S. GAAP through the use of Accounting Standards Updates ("ASUs") to the FASB's Accounting Standards Codification. The Company evaluates the applicability and potential impacts of recent ASUs on its Consolidated Financial Statements and related disclosures. Recently Adopted Accounting Standards In February 2016, the FASB amended its guidance related to lease accounting. The amended guidance required lessees to recognize a majority of their leases on the balance sheet as a right-of-use ("ROU") asset and a lease liability. Lessees are permitted to make an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less. Lease expense will be recorded in a manner similar to current accounting, with leases being classified as either finance or operating in nature. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The Company adopted the new standard using the modified retrospective approach on January 1, 2019. The Company's adoption included lease codification improvements that were issued by the FASB through March 2019. The Company elected an available transition method that uses the effective date of the amended guidance as the date of initial application. The FASB made available several practical expedients in adopting the amended lease accounting guidance. The Company elected the package of practical expedients permitted under the transition guidance within the amended guidance, which among other things, allowed registrants to carry forward historical lease classification. The Company elected the practical expedient that allows the combination of both lease and non-lease components as a single component and account for it as a lease for all classes of underlying assets. The Company elected not to apply the amended guidance to short term leases with an initial term of 12 months or less. The Company recognizes those lease payments in the Consolidated Statements of Income on a straight-line basis over the lease term. The Company elected to use a single discount rate for a portfolio of leases with reasonably similar characteristics. The most significant impact was the recognition of ROU assets and related lease liabilities for operating leases on the Consolidated Balance Sheet. The Company recognized ROU assets and related lease liabilities of $31,724 and $32,579 respectively, related to operating lease commitments, as of January 1, 2019. The operating lease ROU asset represents the lease liability, plus any lease payments made at or before the commencement date, less any lease incentives received. The amended guidance did not have a material impact on the Company's cash flows or results of operations. See Note 14 of the Consolidated Financial Statements. In May 2014, the FASB amended its guidance related to revenue recognition. The amended guidance established a single comprehensive model for companies to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance, including industry-specific guidance. The amended guidance clarified that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In applying the amended guidance, an entity (1) identifies the contract(s) with a customer; (2) identifies the performance obligations in the contract; (3) determines the transaction price; (4) allocates the transaction price to the contract’s performance obligations; and (5) recognizes revenue when (or as) the entity satisfies a performance obligation. The amended guidance applied to all contracts with customers except those that are within the scope of other topics in the FASB Accounting Standards Codification. Entities had the option of using either a full retrospective or modified retrospective approach to the amended guidance. The Company adopted the amended guidance, Accounting Standard Codification 606, Revenue from Contracts with Customers (“ASC 606”), and related amendments, using the modified retrospective approach on January 1, 2018, at which time it became effective for the Company. The Company recognized the cumulative effect of initially applying the new revenue standard to all contracts that were not completed on the date of adoption as an adjustment to the opening balance of retained earnings. A majority of revenue continues to be recognized when products are shipped. Under the amended guidance, however, a certain portion of our businesses with customized products or contracts in which we perform work on customer-owned assets require the use of an "over time" recognition model as certain of these contracts meet one or more of the criteria established in the amended guidance. Revenue recognition on contracts requiring over time accounting recognition created unbilled receivables (contract assets) and reduced inventory on the Company’s Consolidated Balance Sheet. Adoption of the amended guidance also resulted in the recognition of customer advances for which the Company has received an unconditional right to payment. Since the related performance obligations have not been satisfied, however, the Company recognized these customer advances as trade receivables, with a corresponding contract liability of equal amount. Under the previous guidance, the Company recognized customer advances when payment was received. See Note 4 of the Consolidated Financial Statements. In August 2016, the FASB amended its guidance related to the Statement of Cash Flows. The amended guidance clarifies how certain cash receipts and cash payments should be presented on the statement of cash flows. The guidance is effective for annual periods beginning after December 15, 2017 and interim periods within those fiscal years. The Company adopted the guidance during the first quarter of 2018 and the adoption did not have an impact on its Statement of Cash Flows. In January 2017, the FASB amended its guidance related to goodwill impairment testing. The amended guidance simplifies the subsequent measurement of goodwill, eliminating Step 2 from the goodwill impairment test. Under the amended guidance, companies should perform their annual goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. Companies would recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, assuming the loss recognized does not exceed the total amount of goodwill for the reporting unit. The amended guidance is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company elected to early adopt this amended guidance during the second quarter of 2018 in connection with its annual goodwill impairment testing and it did not have an impact on the Company's Consolidated Financial Statements. In March 2017, the FASB amended its guidance related to the presentation of pension and other postretirement benefit costs. The amended guidance requires the bifurcation of net periodic benefit cost for pension and other postretirement plans. The service cost component of expense requires presentation with other employee compensation costs in operating income, consistent with the earlier guidance. The other components of expense, however, are reported separately outside of operating income. The amended guidance also allows only the service cost component of net benefit cost to be eligible for capitalization. The guidance was effective for annual periods beginning after December 15, 2017 and interim periods within that reporting period. The Company adopted the amended guidance on a retrospective basis during the first quarter of 2018 and it did not have a material impact on its results of operations. See Note 12 of the Consolidated Financial Statements for additional disclosure related to pension and postretirement benefit costs. In February 2018, the FASB issued guidance related to the impacts of the tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Act”). The guidance permits the reclassification of certain income tax effects of the Act from Accumulated Other Comprehensive Income to Retained Earnings (stranded tax effects). The stranded tax effects resulted from the December 31, 2017 remeasurement of deferred income taxes that was recorded through the Consolidated Statements of Income, with no corresponding adjustment to Accumulated Other Comprehensive Income having been initially recognized. The guidance is effective for annual periods beginning after December 15, 2018, and interim periods within that reporting period. Early adoption is permitted. The Company elected to early adopt this amended guidance during the first quarter of 2018 using specific identification and as a result reclassified $19,331 from Accumulated Other Comprehensive Income to Retained Earnings on the Consolidated Balance Sheets. This reclassification relates only to the change in the U.S. Corporate income tax rate. In August 2018, the FASB issued new guidance related to a customer's accounting for implementation, set-up, and other upfront costs incurred in a cloud computing arrangement that is hosted by a vendor (for example, a service contract). Pursuant to the new guidance, customers apply the same criteria for capitalizing implementation costs in a hosting arrangement as they would for an arrangement that has a software license. The new guidance is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted, including adoption in any interim period for which financial statements have not been issued. The FASB provided the option of applying the guidance retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company elected to early adopt this guidance, prospectively, during the third quarter of 2018, and it did not have a material impact on the Consolidated Financial Statements. In August 2017, the FASB amended its guidance related to hedge accounting. The amended guidance makes more financial and nonfinancial hedging strategies eligible for hedge accounting, amends presentation and disclosure requirements and changes the assessment of effectiveness. The guidance also more closely aligns hedge accounting with management strategies, simplifies application and increases the transparency of hedging. The amended guidance is effective January 1, 2019, with early adoption permitted in any interim period. The Company adopted the amended guidance on January 1, 2019 and it did not have a material impact on the Consolidated Financial Statements, however it did result in amendments to certain disclosures required pursuant to the earlier guidance. See Note 10 of the Consolidated Financial Statements. Recently Issued Accounting Standards In August 2018, the FASB amended its guidance related to disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The amended requirements serve to remove, add and otherwise clarify certain existing disclosures. The amended guidance is effective for fiscal years ending after December 15, 2020. The guidance requires application on a retrospective basis to all periods presented. The Company is currently evaluating the impact that the guidance may have on the disclosures within its Consolidated Financial Statements. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue The Company is a global provider of highly engineered products, differentiated industrial technologies, and innovative solutions, serving a wide range of end markets and customers. Its specialized products and services are used in far-reaching applications including aerospace, transportation, manufacturing, automation, healthcare, and packaging. The Company accounts for revenue in accordance with ASC 606, which it adopted on January 1, 2018, using the modified retrospective approach. Note 3 of the Consolidated Financial Statements further discusses this adoption. Revenue is recognized by the Company when control of the product or solution is transferred to the customer. Control is generally transferred when products are shipped or delivered to customers, title is transferred and the significant risks and rewards of ownership have transferred, and the Company has rights to payment and rewards of ownership pass to the customer. Customer acceptance may also be a factor in determining whether control of the product has transferred. Although revenue is generally transferred at a point in time, a certain portion of businesses with customized products or contracts in which the Company performs work on customer-owned assets requires the use of an over time recognition model as certain contracts meet one or more of the established criteria pursuant to ASC 606. Also, service revenue is recognized as control transfers, which is concurrent with the services being performed. The following table presents the Company's revenue disaggregated by products and services, and geographic regions, by segment. Three months ended March 31, 2019 2018 Industrial Aerospace Total Company Industrial Aerospace Total Company Product and Services Engineered Components Products $ 69,684 $ — $ 69,684 $ 77,090 $ — $ 77,090 Molding Solutions Products 106,793 — 106,793 119,099 — 119,099 Force & Motion Control Products 51,617 — 51,617 49,772 — 49,772 Automation Products 14,408 — 14,408 — — — Aerospace Original Equipment Manufacturer Products — 87,939 87,939 — 80,695 80,695 Aerospace Aftermarket Products and Services — 46,251 46,251 — 40,004 40,004 $ 242,502 $ 134,190 $ 376,692 $ 245,961 $ 120,699 $ 366,660 Geographic Regions (A) Americas $ 98,288 $ 96,144 $ 194,432 $ 96,527 $ 85,961 $ 182,488 Europe 94,430 24,324 118,754 94,140 24,675 118,815 Asia 48,942 12,404 61,346 54,380 8,913 63,293 Other 842 1,318 2,160 914 1,150 2,064 $ 242,502 $ 134,190 $ 376,692 $ 245,961 $ 120,699 $ 366,660 (A) Sales by geographic market are based on the location to which the product is shipped. Revenue from goods and services transferred to customers at a point in time accounted for approximately 90 percent of revenue for the three-month periods ended March 31, 2019 and March 31, 2018 . A majority of revenue within the Industrial segment and Aerospace OEM business is recognized at a point in time when the product or solution is shipped to the customer. A portion of revenue within the Aerospace Aftermarket business is also recognized when product is shipped. Revenue from products and services transferred to customers over time accounted for approximately 10 percent of revenue for the three-month period ended March 31, 2019 and March 31, 2018 . The Company recognizes revenue over time in instances where a contract supports a continual transfer of control to the customer. Substantially all of our revenue in the Aerospace maintenance repair and overhaul business and a portion of the Engineered Components Products, Molding Solutions Products and Aerospace OEM Products is recognized over time. Within the Molding Solution businesses and Aerospace Aftermarket business, this continual transfer of control to the customer results from repair and refurbishment work performed on customer controlled assets. With other contracts, this continual transfer of control to the customer is supported by clauses in the contract where we deliver products that do not have an alternative use and requires an enforceable right to payment of costs incurred (plus a reasonable profit) or the Company has a contractual right to complete any work in process and receive full contract price. Performance Obligations. A performance obligation represents a promise within a contract to provide a distinct good or service to the customer. The Company accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectibility of consideration is probable. Transaction price reflects the amount of consideration which the Company expects to be entitled in exchange for transferred goods or services. A contract’s transaction price is allocated to each distinct performance obligation and revenue is recognized as the performance obligation is satisfied. The majority of our revenues are from contracts that are less than one year, however certain Aerospace OEM and Industrial Molding Solutions business contracts extend beyond one year. In the Industrial segment, customers are typically with OEMs or suppliers to OEMs and in some businesses, with distributors. In the Aerospace segment, customers include commercial airlines, OEMs and other aircraft and military parts providers. To determine the proper revenue recognition method for contracts, the Company uses judgment to evaluate whether two or more contracts should be combined and accounted for as one single contract and whether the combined or single contract should be accounted for as more than one performance obligation. Contracts within the Aerospace OEM and Engineered Components businesses typically have contracts that are combined as the customer may issue multiple purchase orders at or near the same point in time under the terms of a long term agreement. Revenue is recognized in an over time model based on the extent of progress towards completion of the performance obligation. The selection of the method to measure progress towards completion requires judgment and is based on the nature of the products or services to be provided. The Company utilizes the cost-to-cost measure of progress for over time contracts as we believe this measure best depicts the transfer of control to the customer, which occurs as we incur costs on contracts. Contract Estimates. Due to the nature of the work performed in completing certain performance obligations, the estimation of both total revenue and cost at completion (the process described above) includes a number of variables and requires significant judgment. Estimating total contract revenue may require judgment as certain contracts contain pricing discount structures, rebates, early payment discounts, or other provisions that can impact transaction price. The Company generally estimates variable consideration utilizing the expected value methodology as multiple inputs are considered and weighed, such as customer history, customer forecast communications, economic outlooks, and industry data. In certain circumstances where a particular outcome is probable, we utilize the most likely amount to which we expect to be entitled. The Company includes estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Estimating the total expected costs related to contracts also requires significant judgment. The Aerospace OEM business has an Estimate at Completion (EAC) process in which management reviews the progress and execution of our performance obligations for significant contracts with revenue recognized under an over time model. As part of this process, management reviews information including, but not limited to, performance under the contract, progress towards completion, identified risks and opportunities, sourcing determinations and related changes in estimates of costs to be incurred. These considerations include management's judgment about the ability and cost to achieve technical requirements and other contract requirements. Management makes assumptions and estimates regarding labor efficiency, the complexity of the work to be performed, the availability of materials, the length of time to complete the performance obligation (e.g., to estimate increases in wages and prices for materials and related support cost allocations), execution by our subcontractors and overhead cost rates, among other variables. The Company generally utilizes the portfolio approach to estimate the amount of revenue to recognize for certain other contracts which require over time revenue recognition. Such contracts are grouped together either by revenue stream, customer or product. Each portfolio of contracts is grouped together based on having similar characteristics. The portfolio approach is utilized only when the result of the accounting is not expected to be materially different than if applied to individual contracts. Adjustments to net sales, cost of sales and the related impact to operating income are recognized as necessary in the period they become known. Revenue recognized from performance obligations satisfied in previous periods was not material in the first three months of 2019 and 2018 . Contract Balances . The timing of revenue recognition, invoicing and cash collections affect accounts receivable, unbilled receivables (contract assets) and customer advances and deposits (contract liabilities) on the Consolidated Balance Sheets. Unbilled Receivables (Contract Assets) - Pursuant to the over time revenue recognition model, revenue may be recognized prior to the customer being invoiced. An unbilled receivable is recorded to reflect revenue that is recognized when 1) the cost-to-cost method is applied and 2) such revenue exceeds the amount invoiced to the customer. Unbilled receivables are included within prepaid expenses and other current assets on the Consolidated Balance Sheet as of March 31, 2019 and March 31, 2018 . Customer Advances and Deposits (Contract Liabilities) - The Company may receive a customer advance or deposit, or have an unconditional right to receive a customer advance, prior to revenue being recognized. Certain contracts within the Molding Solutions businesses, for example, may require such advances. Since the performance obligations related to such advances may not have been satisfied, a contract liability is established. An offsetting asset of equal amount is recorded as an account receivable until the advance is collected. Advances and deposits are included within accrued liabilities on the Consolidated Balance Sheets until the respective revenue is recognized. Advance payments are not considered a significant financing component as they are generally received less than one year before the customer solution is completed. These assets and liabilities are reported on the Consolidated Balance Sheet on an individual contract basis at the end of each reporting period. Net contract assets (liabilities) consisted of the following: March 31, 2019 December 31, 2018 $ Change % Change Unbilled receivables (contract assets) $ 17,501 $ 11,844 $ 5,657 48 % Contract liabilities (56,606 ) (57,522 ) 916 (2 )% Net contract liabilities $ (39,105 ) $ (45,678 ) $ 6,573 (14 )% Contract liabilities balances at March 31, 2019 and December 31, 2018 include $14,243 and $15,348 respectively, of customer advances for which the Company has an unconditional right to collect payment. Accounts receivable, as presented on the Consolidated Balance Sheet, includes corresponding balances at March 31, 2019 and December 31, 2018 , respectively. Changes in the net contract liabilities balance during the three-month period ended March 31, 2019 were impacted by a $916 net decrease in contract liabilities, driven primarily by revenue recognized in the current period, partially offset by new customer advances and deposits. Adding to the contract liability decrease was a $5,657 net increase in contract assets, driven primarily by contract progress (i.e. unbilled receivable), partially offset by earlier contract progress being invoiced to the customer. The Company recognized approximately 35% of the revenue related to the contract liability balance as of December 31, 2018 during the three-month period ended March 31, 2019 , primarily representing revenue from the sale of molds and hot runners within the Molding Solutions businesses. Contract Costs. The Company may incur costs to fulfill a contract. Costs are incurred to develop, design and manufacture tooling to produce a customer’s customized product in conjunction with certain of its contracts, primarily in the Aerospace OEM business. For certain contracts, control related to this tooling remains with the Company. The tooling may be deemed recoverable over the life of the related customer contract (oftentimes a long-term agreement). The Company therefore capitalizes these tooling costs and amortizes them over the shorter of the tooling life or the duration of the long-term agreement. The Company may also incur costs related to the development of product designs (molds or hot runner systems) within its Molding Solutions businesses. Control of the design may be retained by the Company and deemed recoverable over the contract to build the systems or mold, therefore this design work cost is capitalized and amortized to cost of sales when the related revenue is recognized. Amortization related to these capitalized costs to fulfill a contract were $3,434 and $3,986 in the three month periods ended March 31, 2019 and March 31, 2018 , respectively. Capitalized costs, net of amortization, to fulfill a contract balances were as follows: March 31, 2019 December 31, 2018 Tooling $ 6,058 $ 6,155 Design costs 2,281 2,285 Other — 5 $ 8,339 $ 8,445 Remaining Performance Obligations . The Company has elected to disclose remaining performance obligations only for contracts with an original duration of greater than one year. Such remaining performance obligations represent the transaction price of firm orders for which work has not been performed and, for Aerospace, excludes projections of components and assemblies that Aerospace OEM customers anticipate purchasing in the future under existing programs, which represent orders that are beyond lead time and do not represent performance obligations pursuant to ASC 606. As of March 31, 2019 , the aggregate amount of the transaction price allocated to remaining performance obligations was $228,536 . The Company expects to recognize revenue on approximately 80% of the remaining performance obligations over the next 12 months, with the remainder being recognized within 24 months. |
Stockholders Equity
Stockholders Equity | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Stockholders Equity | Stockholders Equity A schedule of consolidated changes in equity for the three months ended March 31, 2019 is as follows (shares in thousands): Common Common Additional Treasury Treasury Retained Accumulated Total December 31, 2018 63,367 $ 634 $ 470,818 12,034 $ (441,668 ) $ 1,363,772 $ (190,500 ) $ 1,203,056 Comprehensive income 33,992 (8,178 ) 25,814 Dividends declared ($0.16 per share) (8,217 ) (8,217 ) Employee stock plans 51 4,039 1 (80 ) (109 ) 3,850 March 31, 2019 63,418 $ 634 $ 474,857 12,035 $ (441,748 ) $ 1,389,438 $ (198,678 ) $ 1,224,503 A schedule of consolidated changes in equity for the three months ended March 31, 2018 is as follows (shares in thousands): Common Common Additional Treasury Treasury Retained Accumulated Total December 31, 2017 63,034 $ 630 $ 457,365 9,656 $ (297,998 ) $ 1,206,723 $ (106,399 ) $ 1,260,321 Comprehensive income 38,818 30,513 69,331 Dividends declared ($0.14 per share) (7,453 ) (7,453 ) Common stock repurchases 533 (33,541 ) (33,541 ) Reclassification pursuant to accounting guidance related to U.S. Tax Reform (Note 3) 19,331 (19,331 ) — Cumulative effect of change in accounting guidance related to Revenue (Note 3) 4,295 4,295 Employee stock plans 20 1 2,874 1 (68 ) (174 ) 2,633 March 31, 2018 63,054 $ 631 $ 460,239 10,190 $ (331,607 ) $ 1,261,540 $ (95,217 ) $ 1,295,586 |
Net Income Per Common Share
Net Income Per Common Share | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Income Per Common Share | Net Income Per Common Share For the purpose of computing diluted net income per common share, the weighted-average number of common shares outstanding is increased for the potential dilutive effects of stock-based incentive plans. For the purpose of computing diluted net income per common share, the weighted-average number of common shares outstanding was increased by 528,661 and 553,903 for the three-month periods ended March 31, 2019 and 2018 , respectively, to account for the potential dilutive effect of stock-based incentive plans. There were no adjustments to net income for the purposes of computing income available to common stockholders for the periods. The calculation of weighted-average diluted shares outstanding excludes all shares that would have been anti-dilutive. During the three-month periods ended March 31, 2019 and 2018 , the Company excluded 221,201 and 153,908 stock awards, respectively, from the calculation of weighted-average diluted shares outstanding as the stock awards were considered anti-dilutive. The Company granted 120,585 stock options, 93,992 restricted stock unit awards and 88,402 performance share awards ("PSAs") in February 2019 as part of its annual grant awards. All of the stock options and the restricted stock unit awards vest upon meeting certain service conditions. The restricted stock unit awards are included in basic weighted-average common shares outstanding as they contain nonforfeitable rights to dividend payments. The PSAs are part of the long-term Performance Share Award Program (the "Awards Program") and are based on performance goals that are driven by a combination of independently measured metrics (depending on the grant year) with each metric being weighted equally. The metrics for awards granted in 2019 include the Company’s total shareholder return (“TSR”), return on invested capital (“ROIC”) and operating income before depreciation and amortization growth ("EBITDA growth"). The TSR and EBITDA growth metrics are designed to assess the long-term Company performance relative to the performance of companies included in the Russell 2000 Index over a three -year performance period. ROIC is designed to assess the Company's performance compared to pre-established Company targets over a three -year performance period. The participants can earn from zero to 250% of the target award and the award includes a forfeitable right to dividend equivalents, which are not included in the aggregate target award numbers. The fair value of the TSR portion of the PSA was determined using a Monte Carlo valuation method as the award contains a market condition. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories The components of inventories consisted of: March 31, 2019 December 31, 2018 Finished goods $ 84,965 $ 87,779 Work-in-process 96,146 98,426 Raw material and supplies 76,138 79,785 $ 257,249 $ 265,990 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill: The following table sets forth the change in the carrying amount of goodwill for each reportable segment and for the Company as of and for the period ended March 31, 2019 : Industrial Aerospace Total Company January 1, 2019 $ 924,738 $ 30,786 $ 955,524 Acquisition related 681 — 681 Foreign currency translation (11,396 ) — (11,396 ) March 31, 2019 $ 914,023 $ 30,786 $ 944,809 Other Intangible Assets: Other intangible assets consisted of: March 31, 2019 December 31, 2018 Range of Life - Years Gross Amount Accumulated Amortization Gross Amount Accumulated Amortization Amortized intangible assets: Revenue sharing programs (RSPs) Up to 30 $ 299,500 $ (125,533 ) $ 299,500 $ (121,957 ) Component repair programs (CRPs) Up to 30 111,839 (23,404 ) 111,839 (21,895 ) Customer relationships 10-16 338,366 (84,496 ) 338,366 (79,439 ) Patents and technology 4-14 125,852 (62,600 ) 125,852 (59,205 ) Trademarks/trade names 10-30 11,950 (10,830 ) 11,950 (10,731 ) Other Up to 15 7,296 (3,662 ) 7,296 (3,551 ) 894,803 (310,525 ) 894,803 (296,778 ) Unamortized intangible assets: Trade names 55,670 — 55,670 — Foreign currency translation (22,386 ) — (17,157 ) — Other intangible assets $ 928,087 $ (310,525 ) $ 933,316 $ (296,778 ) Estimated amortization of intangible assets for future periods is as follows: 2019 - $53,000 ; 2020 - $50,000 ; 2021 - $49,000 ; 2022 - $49,000 and 2023 - $48,000 . |
Debt
Debt | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt The Company's debt agreements contain financial covenants that require the maintenance of interest coverage and leverage ratios. The Company is in compliance with its financial covenants as of March 31, 2019 , and continues to monitor its future compliance based on current and anticipated future economic conditions. Long-term debt and notes and overdrafts payable at March 31, 2019 and December 31, 2018 consisted of: March 31, 2019 December 31, 2018 Carrying Amount Fair Value Carrying Amount Fair Value Revolving credit agreement $ 772,737 $ 788,492 $ 831,016 $ 828,800 3.97% Senior Notes 100,000 102,504 100,000 100,185 Borrowings under lines of credit and overdrafts 23,051 23,051 2,137 2,137 Capital leases 9,400 9,563 10,216 10,503 Other foreign bank borrowings 634 638 647 651 905,822 924,248 944,016 942,276 Less current maturities (28,282 ) (7,659 ) Long-term debt $ 877,540 $ 936,357 In February 2017, the Company and certain of its subsidiaries entered into the fourth amendment of its fifth amended and restated revolving credit agreement (the “Amended Credit Agreement”) and retained Bank of America, N.A as the Administrative Agent for the lenders. The Amended Credit Agreement increases the facility from $750,000 to $850,000 and extends the maturity date from September 2018 to February 2022. The Amended Credit Agreement also increases the existing accordion feature from $250,000 , allowing the Company to now request additional borrowings of up to $350,000 . The Company may exercise the accordion feature upon request to the Administrative Agent as long as an event of default has not occurred or is not continuing. The borrowing availability of $850,000 , pursuant to the terms of the Amended Credit Agreement, allows for multi-currency borrowing which includes euro, British pound sterling or Swiss franc borrowing, up to $600,000 . In September 2018, the Company and one of its wholly owned subsidiaries entered into a Sale and Purchase Agreement to acquire Gimatic S.r.l. See Note 2 of the Consolidated Financial Statements. In conjunction with the Acquisition, the Company requested additional borrowings of $150,000 that was provided for under the existing accordion feature. The Administrative Agent for the lenders approved the Company's access to the accordion feature and on October 19, 2018 the lenders formally committed the capital to fund such feature, resulting in the execution of the fifth amendment to the Amended Credit Agreement (the "Fifth Amendment"). The Fifth Amendment, effective October 19, 2018, thereby increased the borrowing availability of the existing facility to $1,000,000 . The Company may also request access to the residual $200,000 of the accordion feature. Depending on the Company’s consolidated leverage ratio, and at the election of the Company, borrowings under the Amended Credit Agreement will bear interest at either LIBOR plus a margin of between 1.10% and 1.70% or the base rate, as defined in the Amended Credit Agreement, plus a margin of 0.10% to 0.70% . Multi-currency borrowings, pursuant to the Amended Credit Agreement, bear interest at their respective interbank offered rate (i.e. Euribor) or 0.00% (higher of the two rates) plus a margin of between 1.10% and 1.70% . The Company paid fees and expenses of $529 in the fourth quarter of 2018 in conjunction with executing the Fifth Amendment; such fees have been deferred within Other Assets on the accompanying Consolidated Balance Sheets and are being amortized into interest expense on the accompanying Consolidated Statements of Income through its maturity. Borrowings and availability under the Amended Credit Agreement were $772,737 and $227,263 , respectively, at March 31, 2019 and $831,016 and $168,984 , respectively, at December 31, 2018 . The average interest rate on these borrowings was 1.82% and 1.99% on March 31, 2019 and December 31, 2018 , respectively. Borrowings included Euro-denominated borrowings of 490,080 Euros ( $550,237 ) at March 31, 2019 and 470,350 Euros ( $538,316 ) at December 31, 2018. The fair value of the borrowings is based on observable Level 2 inputs. The borrowings were valued using discounted cash flows based upon the Company's estimated interest costs for similar types of borrowings. In the first quarter of 2019, and the second quarter of 2018, the Company borrowed 44,100 Euros ( $49,506 ) and 179,000 Euros ( $208,589 ), respectively, under the Amended Credit Facility through an international subsidiary. The proceeds were distributed to the Parent Company and subsequently used to pay down U.S. borrowings under the Amended Credit Agreement. In October 2014, the Company entered into a Note Purchase Agreement (“Note Purchase Agreement”), among the Company and New York Life Insurance Company, New York Life Insurance and Annuity Corporation and New York Life Insurance and Annuity Corporation Institutionally Owned Life Insurance Separate Account, as purchasers, for the issuance of $100,000 aggregate principal amount of 3.97% Senior Notes due October 17, 2024 (the “ 3.97% Senior Notes”). The 3.97% Senior Notes are senior unsecured obligations of the Company and pay interest semi-annually on April 17 and October 17 of each year at an annual rate of 3.97% . The 3.97% Senior Notes will mature on October 17, 2024 unless earlier prepaid in accordance with their terms. Subject to certain conditions, the Company may, at its option, prepay all or any part of the 3.97% Senior Notes in an amount equal to 100% of the principal amount of the 3.97% Senior Notes so prepaid, plus any accrued and unpaid interest to the date of prepayment, plus the Make-Whole Amount, as defined in the Note Purchase Agreement, with respect to such principal amount being prepaid. The fair value of the 3.97% Senior Notes was determined using the US Treasury yield and a long-term credit spread for similar types of borrowings, which represent Level 2 observable inputs. The Company's borrowing capacity remains limited by various debt covenants in the Amended Credit Agreement and the Note Purchase Agreement (the "Agreements"). The Agreements require the Company to maintain a ratio of Consolidated Senior Debt, as defined, to Consolidated EBITDA, as defined, of not more than 3.25 times ("Senior Debt Ratio"), a ratio of Consolidated Total Debt, as defined, to Consolidated EBITDA of not more than 3.75 times ("Total Debt Ratio") and a ratio of Consolidated EBITDA to Consolidated Cash Interest Expense, as defined, of not less than 4.25 , in each case at the end of each fiscal quarter; provided that the debt to EBITDA ratios are permitted to increase for a period of four fiscal quarters after the closing of certain permitted acquisitions. A permitted acquisition is defined as an acquisition exceeding $150,000 , for which the acquisition of Gimatic qualifies. With the completion of a permitted acquisition, the Senior Debt Ratio cannot exceed 3.50 times and the Total Debt Ratio cannot exceed 4.25 times. The increased ratios are allowed for a period of four fiscal quarters subsequent to the close of the permitted acquisition. In addition, the Company has available approximately $87,000 in uncommitted short-term bank credit lines ("Credit Lines") and overdraft facilities. The Credit Lines are accessed locally and are available primarily within the U.S., Europe and Asia. The Credit Lines are subject to the applicable borrowing rates within each respective country and vary between jurisdictions (i.e. LIBOR, Euribor, etc.). Under the Credit Lines, $23,000 was borrowed at March 31, 2019 at an interest rate of 3.21% and $2,041 was borrowed at December 31, 2018 at an average interest rate of 0.17% . The Company had also borrowed $51 and $96 under the overdraft facilities at March 31, 2019 and December 31, 2018 , respectively. Repayments under the Credit Lines are due within one month after being borrowed. Repayments of the overdrafts are generally due within two days after being borrowed. The carrying amounts of the Credit Lines and overdrafts approximate fair value due to the short maturities of these financial instruments. The Company has several capital leases under which $9,400 and $10,216 was outstanding at March 31, 2019 and December 31, 2018 , respectively. The fair value of the capital leases are based on observable Level 2 inputs. These instruments were valued using discounted cash flows based upon the Company's estimated interest costs for similar types of borrowings. At March 31, 2019 and December 31, 2018 , the Company also had other foreign bank borrowings of $634 and $647 , respectively. The fair value of the other foreign bank borrowings is based on observable Level 2 inputs. These instruments were valued using discounted cash flows based upon the Company's estimated interest costs for similar types of borrowings. |
Derivatives
Derivatives | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | Derivatives The Company has manufacturing and sales facilities around the world and thus makes investments and conducts business transactions denominated in various currencies. The Company is also exposed to fluctuations in interest rates and commodity price changes. These financial exposures are monitored and managed by the Company as an integral part of its risk management program. Financial instruments have been used by the Company to hedge its exposure to fluctuations in interest rates. The Company entered into an interest rate swap agreement (the "Swap") on April 28, 2017, with one bank, which converts the interest on the first $100,000 of the Company's one-month LIBOR-based borrowings from a variable rate plus the borrowing spread to a fixed rate of 1.92% plus the borrowing spread. The Swap expires on January 31, 2022 and is accounted for as a cash flow hedge. The Company also uses financial instruments to hedge its exposures to fluctuations in foreign currency exchange rates. The Company has various contracts outstanding which primarily hedge recognized assets or liabilities and anticipated transactions in various currencies including the Euro, British pound sterling, U.S. dollar, Canadian dollar, Japanese yen, Singapore dollar, Korean won, Swedish kroner, Chinese renminbi and Swiss franc. Certain foreign currency derivative instruments are treated as cash flow hedges of forecasted transactions. All foreign exchange contracts are due within two years . The Company does not use derivatives for speculative or trading purposes or to manage commodity exposures. Changes in the fair market value of derivatives that qualify as cash flow hedges are recorded to accumulated other non-owner changes to equity. Amounts recorded to accumulated other non-owner changes to equity are reclassified to earnings in a manner that matches the earnings impact of the hedged transaction. Amounts related to contracts that are not designated as hedges are recorded directly to earnings. The Company's policy for classifying cash flows from derivatives is to report the cash flows consistent with the underlying hedged item. Other financing cash flows during the first three months of 2019 and 2018 , as presented on the Consolidated Statements of Cash Flows, include $1,299 and $6,505 , respectively, of net cash payments related to the settlement of foreign currency hedges related to intercompany financing. The following table sets forth the fair value amounts of derivative instruments held by the Company. Derivative Assets Derivative Liabilities Fair Value Fair Value Balance Sheet Location March 31, 2019 December 31, 2018 Balance Sheet Location March 31, 2019 December 31, 2018 Derivatives designated as hedging instruments: Interest rate contracts Other assets $ 773 $ 1,412 Other liabilities $ — $ — Foreign exchange contracts Prepaid expenses and other current assets — — Accrued liabilities (361 ) (258 ) Total derivatives designated as hedging instruments 773 1,412 (361 ) (258 ) Derivatives not designated as hedging instruments: Foreign exchange contracts Prepaid expenses and other current assets 20 1,105 Accrued liabilities (949 ) (90 ) Total derivatives not designated as hedging instruments 20 1,105 (949 ) (90 ) Total derivatives $ 793 $ 2,517 $ (1,310 ) $ (348 ) The following table sets forth the effect of hedge accounting on accumulated other comprehensive (loss) income for the three -month periods ended March 31, 2019 and 2018 : Amount of (Loss) Gain Recognized in Accumulated Other Comprehensive (Loss) Income on Derivative Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income Three months ended March 31, Three months ended March 31, Derivatives in Hedging Relationships 2019 2018 2019 2018 Derivatives in Cash Flow Hedging Relationships: Interest rate contracts $ (487 ) $ 1,235 Interest expense $ 142 $ (82 ) Foreign exchange contracts (81 ) (839 ) Net sales (337 ) (226 ) Total $ (568 ) $ 396 $ (195 ) $ (308 ) The following table sets forth the effect of hedge accounting on the consolidated statements of income for the three -month periods ended March 31, 2019 and 2018 : Location and Amount of Gain (Loss) Recognized in Income on Hedging Relationships Three months ended March 31, 2019 2018 Net sales Interest expense Net sales Interest expense Total amounts of income and expense line items presented in the consolidated statements of income in which the effects of hedges are recorded $ 376,692 $ 5,113 $ 366,660 $ 3,892 The effects of hedging: Gain (Loss) on cash flow hedging relationships Interest rate contracts Amount of gain (loss) reclassified from accumulated other comprehensive income (loss) into income 142 (82 ) Foreign exchange contracts Amount of gain (loss) reclassified from accumulated other comprehensive income (loss) into income (337 ) (226 ) The following table sets forth the effect of derivatives not designated as hedging instruments on the consolidated statements of income for the three -month periods ended March 31, 2019 and 2018 . Location of Gain (Loss) Recognized in Income on Derivative Amount of Gain (Loss) Recognized in Income on Derivative (A) Three months ended March 31, Derivatives Not Designated as Hedging Instruments 2019 2018 Foreign exchange contracts Other expense (income), net $ (3,819 ) $ (6,092 ) (A) Such amounts were substantially offset by the net (gain) loss recorded on the underlying hedged asset or liability, also recorded in other expense (income), net. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The provisions of the accounting standard for fair value define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This standard classifies the inputs used to measure fair value into the following hierarchy: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability. Level 3 Unobservable inputs for the asset or liability. The following table provides the assets and liabilities reported at fair value and measured on a recurring basis: Fair Value Measurements Using Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) March 31, 2019 Asset derivatives $ 793 $ — $ 793 $ — Liability derivatives (1,310 ) — (1,310 ) — Bank acceptances 10,212 — 10,212 — Rabbi trust assets 2,704 2,704 — — $ 12,399 $ 2,704 $ 9,695 $ — December 31, 2018 Asset derivatives $ 2,517 $ — $ 2,517 $ — Liability derivatives (348 ) — (348 ) — Bank acceptances 17,698 — 17,698 — Rabbi trust assets 2,457 2,457 — — $ 22,324 $ 2,457 $ 19,867 $ — The derivative contracts are valued using observable current market information as of the reporting date such as the prevailing LIBOR-based interest rates and foreign currency spot and forward rates. Bank acceptances represent financial instruments accepted from certain Chinese customers in lieu of cash paid on receivables, generally range from three to six months in maturity and are guaranteed by banks. The carrying amounts of the bank acceptances, which are included within prepaid expenses and other current assets, approximate fair value due to their short maturities. The fair values of rabbi trust assets are based on quoted market prices from various financial exchanges. |
Pension and Other Postretiremen
Pension and Other Postretirement Benefits | 3 Months Ended |
Mar. 31, 2019 | |
Retirement Benefits [Abstract] | |
Pension and Other Postretirement Benefits | Pension and Other Postretirement Benefits Pension and other postretirement benefits expenses consisted of the following: Three months ended March 31, Pensions 2019 2018 Service cost $ 1,433 $ 1,590 Interest cost 4,536 4,309 Expected return on plan assets (7,078 ) (7,394 ) Amortization of prior service cost 103 141 Amortization of actuarial losses 2,158 2,811 Net periodic benefit cost $ 1,152 $ 1,457 Three months ended March 31, Other Postretirement Benefits 2019 2018 Service cost $ 19 $ 24 Interest cost 340 344 Amortization of prior service cost 6 5 Amortization of actuarial losses 10 160 Net periodic benefit cost $ 375 $ 533 The service cost component of net periodic benefit cost is included within cost of sales and selling and administrative expenses. The components of net periodic benefit cost other than the service cost component are included in Other Income (Expense) on the Consolidated Statements of Income. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company's effective tax rate for the first quarter of 2019 was 22.3% compared with 23.9% in the first quarter of 2018 and 19.9% for the full year 2018 . The increase in the first quarter of 2019 effective tax rate from the full year 2018 rate is primarily due to the absence of adjustments to certain international valuation reserves and final adjustments resulting from the impact of the Tax Cuts and Jobs Act (the “Act”), combined with a decrease in the excess tax benefit on stock awards. The increase is partially offset by the projected change in the mix of earnings attributable to lower-taxing jurisdictions. The Aerospace and Industrial Segments have a number of multi-year tax holidays in both Singapore and China. These holidays are subject to the Company meeting certain commitments in the respective jurisdictions. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company maintains leases of certain manufacturing, distribution and assembly facilities, office space, land, machinery and equipment. Leases generally have remaining terms of one year to ten years , whereas leases with an initial term of twelve months or less are not recorded on the Consolidated Balance Sheets. The Company recognizes lease expense for minimum lease payments on a straight line basis over the term of the lease. Certain leases include options to renew or terminate. Renewal options are exercisable per the discretion of the Company and vary based on the nature of each lease, with renewal periods generally ranging from one year to five years . The term of the lease includes renewal periods only if the Company is reasonably certain that it will exercise the renewal option. When determining if a renewal option is reasonably certain of being exercised, the Company considers several factors, including but not limited to, the cost of moving to another location, the cost of disruption to operations, whether the purpose or location of the leased asset is unique and the contractual terms associated with extending the lease. Certain leases provide the option to purchase the leased property and are therefore evaluated for finance lease consideration. Right-of-use ("ROU") assets and lease liabilities related to finance leases were not material as of March 31, 2019. The depreciable life of leased assets are limited by the expected term of the lease, unless there is a transfer of title or purchase option and the Company believes it is reasonably certain of exercise. Lease agreements generally do not contain any material residual value guarantees or materially restrictive covenants and the Company does not sublease to any third parties. The Company does not have any material leases that have been signed but not commenced. Contracts are evaluated at inception to determine whether they contain a lease, where the Company obtains the right to control an identified asset. The following table sets forth the classification of ROU assets and lease liabilities on the Consolidated Balance Sheets: Operating Leases Classification March 31, 2019 Leased Assets ROU assets Other assets $ 33,316 Lease Liabilities Current lease liability Accrued liabilities 10,689 Long term lease liability Other liabilities 23,470 $ 34,159 Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The operating lease ROU assets represent the lease liability, plus any lease payments made at or before the commencement date, less any lease incentives received. The Company's real estate leases, which are comprised primarily of manufacturing, distribution and assembly facilities, represent a majority of our lease liability. A significant portion of our lease payments are fixed, although an immaterial portion of payments are variable in nature. Variable lease payments vary based on changes in facts and circumstances related to the use of the ROU and are recorded as incurred. The Company uses an incremental borrowing rate based on rates available at commencement in determining the present value of future payments. The Company has lease agreements with lease and non-lease components, which are accounted for as a single lease component. The Company applies a portfolio approach to effectively account for the operating lease ROU assets and liabilities. Operating lease costs during the three months ended March 31, 2019 were $3,943 and were included within cost of sales and selling and administrative expenses. Operating lease costs include short-term and variable leases costs, which were immaterial during the period. Future minimum lease payments under non-cancellable leases as of March 31, 2019 were as follows: Operating Leases 2019 $ 9,266 2020 9,582 2021 6,995 2022 3,251 2023 2,453 After 2023 7,688 Total lease payments $ 39,235 Less: Interest 5,076 Present value of lease payments $ 34,159 Minimum rental commitments under non-cancellable leases as of December 31, 2018 for years 2019 through 2023 were $11,931 , $8,322 , $5,888 , $2,898 and $2,064 , respectively, and $7,659 thereafter. Lease Term and Discount Rate March 31, 2019 Weighted-average remaining lease term (years) Operating leases 6.2 Weighted-average discount rate Operating leases 3.97 % Other Information March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 3,363 Leased assets obtained in exchange for new operating lease liabilities $ 4,563 |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Income (Loss) by Component | 3 Months Ended |
Mar. 31, 2019 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Changes in Accumulated Other Comprehensive Income (Loss) by Component | Changes in Accumulated Other Comprehensive Income (Loss) by Component The following tables sets forth the changes in accumulated other comprehensive income (loss), net of tax, by component for the three -month periods ended March 31, 2019 and 2018 : Gains and Losses on Cash Flow Hedges Pension and Other Postretirement Benefit Items Foreign Currency Items Total January 1, 2019 $ 834 $ (138,690 ) $ (52,644 ) $ (190,500 ) Other comprehensive (loss) income before reclassifications (723 ) (122 ) (9,225 ) (10,070 ) Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income 155 1,737 — 1,892 Net current-period other comprehensive income (568 ) 1,615 (9,225 ) (8,178 ) March 31, 2019 $ 266 $ (137,075 ) $ (61,869 ) $ (198,678 ) Gains and Losses on Cash Flow Hedges Pension and Other Postretirement Benefit Items Foreign Currency Items Total January 1, 2018 $ 72 $ (103,844 ) $ (2,627 ) $ (106,399 ) Other comprehensive income before reclassifications 157 763 26,953 27,873 Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income 239 2,401 — 2,640 Net current-period other comprehensive income 396 3,164 26,953 30,513 Amounts reclassified from accumulated other comprehensive income to retained earnings (A) — (19,331 ) — (19,331 ) March 31, 2018 $ 468 $ (120,011 ) $ 24,326 $ (95,217 ) (A) This amount represents the reclassification of stranded tax effects resulting from the Act, as permitted by amended guidance issued by the FASB in February 2018. See Note 3 of the Consolidated Financial Statements. The following table sets forth the reclassifications out of accumulated other comprehensive income (loss) by component for the three -month periods ended March 31, 2019 and 2018 : Details about Accumulated Other Comprehensive Income (Loss) Components Amount Reclassified from Accumulated Other Comprehensive Income (Loss) Affected Line Item in the Consolidated Statements of Income Three months ended March 31, 2019 Three months ended March 31, 2018 Gains and losses on cash flow hedges Interest rate contracts $ 142 $ (82 ) Interest expense Foreign exchange contracts (337 ) (226 ) Net sales (195 ) (308 ) Total before tax 40 69 Tax benefit (155 ) (239 ) Net of tax Pension and other postretirement benefit items Amortization of prior-service costs $ (109 ) $ (146 ) (A) Amortization of actuarial losses (2,168 ) (2,971 ) (A) (2,277 ) (3,117 ) Total before tax 540 716 Tax benefit (1,737 ) (2,401 ) Net of tax Total reclassifications in the period $ (1,892 ) $ (2,640 ) (A) These accumulated other comprehensive income (loss) components are included within the computation of net periodic Pension and Other Postretirement Benefits cost. See Note 12 of the Consolidated Financial Statements. |
Information on Business Segment
Information on Business Segments | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Information on Business Segments | Information on Business Segments The Company is organized based upon the nature of its products and services and reports under two global business segments: Industrial and Aerospace. Segment information is consistent with how management reviews the businesses, makes investing and resource allocation decisions and assesses operating performance. The Company has not aggregated operating segments for purposes of identifying these two reportable segments. Industrial is a global provider of highly-engineered, high-quality precision components, products and systems for critical applications serving a diverse customer base in end-markets such as transportation, industrial equipment, automation, personal care, packaging, electronics, and medical devices. Focused on innovative custom solutions, Industrial participates in the design phase of components and assemblies whereby customers receive the benefits of application and systems engineering, new product development, testing and evaluation, and the manufacturing of final products. Products are sold primarily through its direct sales force and global distribution channels. Industrial's Molding Solutions business designs and manufactures customized hot runner systems, advanced mold cavity sensors and process control systems, and precision high cavitation mold assemblies - collectively, the enabling technologies for many complex injection molding applications. The Force & Motion Control business provides innovative cost effective force and motion control solutions for a wide range of metal forming and other industrial markets. The Automation business designs and develops robotic grippers, advanced end-of-arm tooling systems, sensors and other automation components for intelligent robotic handling solutions and industrial automation applications. Industrial's Engineered Components business manufactures and supplies precision mechanical products used in transportation and industrial applications, including mechanical springs, high-precision punched and fine-blanked components and retention rings. Aerospace is a global manufacturer of complex fabricated and precision machined components and assemblies for turbine engines, nacelles and structures for both commercial and military aircraft. The Aerospace aftermarket business provides aircraft engine component MRO services, including services performed under our Component Repair Programs (“CRPs”), for many of the world’s major turbine engine manufacturers, commercial airlines and the military. The Aerospace aftermarket activities also include the manufacture and delivery of aerospace aftermarket spare parts, including revenue sharing programs (“RSPs”) under which the Company receives an exclusive right to supply designated aftermarket parts over the life of specific aircraft engine programs. The following tables set forth information about the Company's operations by its two reportable segments: Three months ended March 31, 2019 2018 Net sales Industrial $ 242,502 $ 245,967 Aerospace 134,190 120,699 Intersegment sales — (6 ) Total net sales $ 376,692 $ 366,660 Operating profit Industrial $ 21,502 $ 32,378 Aerospace 29,147 24,255 Total operating profit 50,649 56,633 Interest expense 5,113 3,892 Other expense (income), net 1,806 1,763 Income before income taxes $ 43,730 $ 50,978 March 31, 2019 December 31, 2018 Assets Industrial $ 1,934,014 $ 1,962,362 Aerospace 706,633 692,584 Other (A) 159,028 154,024 Total assets $ 2,799,675 $ 2,808,970 (A) "Other" assets include corporate-controlled assets, the majority of which are cash and cash equivalents. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Product Warranties The Company provides product warranties in connection with the sale of certain products. From time to time, the Company is subject to customer claims with respect to product warranties. The Company accrues its estimated exposure for warranty claims at the time of sale based upon the length of the warranty period, historical experience and other related information known to the Company. Liabilities related to product warranties and extended warranties were not material as of March 31, 2019 and December 31, 2018 . Litigation The Company is subject to litigation from time to time in the ordinary course of business and various other suits, proceedings and claims are pending involving the Company and its subsidiaries. The Company records a loss contingency liability when a loss is considered probable and the amount can be reasonably estimated. While it is not possible to determine the ultimate disposition of each of these proceedings and whether they will be resolved consistent with the Company's beliefs, the Company expects that the outcome of such proceedings, individually or in the aggregate, will not have a material adverse effect on financial condition or results of operations. |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Pro Forma Information | The pro forma information does not include the effects of any synergies or cost reduction initiatives related to the acquisitions. (Unaudited Pro Forma) Three Months Ended Net Sales $ 386,562 Net Income 37,294 |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Capitalized Contract Cost | Capitalized costs, net of amortization, to fulfill a contract balances were as follows: March 31, 2019 December 31, 2018 Tooling $ 6,058 $ 6,155 Design costs 2,281 2,285 Other — 5 $ 8,339 $ 8,445 |
Disaggregation of Revenue | The following table presents the Company's revenue disaggregated by products and services, and geographic regions, by segment. Three months ended March 31, 2019 2018 Industrial Aerospace Total Company Industrial Aerospace Total Company Product and Services Engineered Components Products $ 69,684 $ — $ 69,684 $ 77,090 $ — $ 77,090 Molding Solutions Products 106,793 — 106,793 119,099 — 119,099 Force & Motion Control Products 51,617 — 51,617 49,772 — 49,772 Automation Products 14,408 — 14,408 — — — Aerospace Original Equipment Manufacturer Products — 87,939 87,939 — 80,695 80,695 Aerospace Aftermarket Products and Services — 46,251 46,251 — 40,004 40,004 $ 242,502 $ 134,190 $ 376,692 $ 245,961 $ 120,699 $ 366,660 Geographic Regions (A) Americas $ 98,288 $ 96,144 $ 194,432 $ 96,527 $ 85,961 $ 182,488 Europe 94,430 24,324 118,754 94,140 24,675 118,815 Asia 48,942 12,404 61,346 54,380 8,913 63,293 Other 842 1,318 2,160 914 1,150 2,064 $ 242,502 $ 134,190 $ 376,692 $ 245,961 $ 120,699 $ 366,660 (A) Sales by geographic market are based on the location to which the product is shipped. |
Contract with Customer, Asset and Liability | Net contract assets (liabilities) consisted of the following: March 31, 2019 December 31, 2018 $ Change % Change Unbilled receivables (contract assets) $ 17,501 $ 11,844 $ 5,657 48 % Contract liabilities (56,606 ) (57,522 ) 916 (2 )% Net contract liabilities $ (39,105 ) $ (45,678 ) $ 6,573 (14 )% |
Stockholders Equity (Tables)
Stockholders Equity (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Schedule of changes in equity | A schedule of consolidated changes in equity for the three months ended March 31, 2019 is as follows (shares in thousands): Common Common Additional Treasury Treasury Retained Accumulated Total December 31, 2018 63,367 $ 634 $ 470,818 12,034 $ (441,668 ) $ 1,363,772 $ (190,500 ) $ 1,203,056 Comprehensive income 33,992 (8,178 ) 25,814 Dividends declared ($0.16 per share) (8,217 ) (8,217 ) Employee stock plans 51 4,039 1 (80 ) (109 ) 3,850 March 31, 2019 63,418 $ 634 $ 474,857 12,035 $ (441,748 ) $ 1,389,438 $ (198,678 ) $ 1,224,503 A schedule of consolidated changes in equity for the three months ended March 31, 2018 is as follows (shares in thousands): Common Common Additional Treasury Treasury Retained Accumulated Total December 31, 2017 63,034 $ 630 $ 457,365 9,656 $ (297,998 ) $ 1,206,723 $ (106,399 ) $ 1,260,321 Comprehensive income 38,818 30,513 69,331 Dividends declared ($0.14 per share) (7,453 ) (7,453 ) Common stock repurchases 533 (33,541 ) (33,541 ) Reclassification pursuant to accounting guidance related to U.S. Tax Reform (Note 3) 19,331 (19,331 ) — Cumulative effect of change in accounting guidance related to Revenue (Note 3) 4,295 4,295 Employee stock plans 20 1 2,874 1 (68 ) (174 ) 2,633 March 31, 2018 63,054 $ 631 $ 460,239 10,190 $ (331,607 ) $ 1,261,540 $ (95,217 ) $ 1,295,586 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | The components of inventories consisted of: March 31, 2019 December 31, 2018 Finished goods $ 84,965 $ 87,779 Work-in-process 96,146 98,426 Raw material and supplies 76,138 79,785 $ 257,249 $ 265,990 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following table sets forth the change in the carrying amount of goodwill for each reportable segment and for the Company as of and for the period ended March 31, 2019 : Industrial Aerospace Total Company January 1, 2019 $ 924,738 $ 30,786 $ 955,524 Acquisition related 681 — 681 Foreign currency translation (11,396 ) — (11,396 ) March 31, 2019 $ 914,023 $ 30,786 $ 944,809 |
Schedule of Intangible Assets | Other intangible assets consisted of: March 31, 2019 December 31, 2018 Range of Life - Years Gross Amount Accumulated Amortization Gross Amount Accumulated Amortization Amortized intangible assets: Revenue sharing programs (RSPs) Up to 30 $ 299,500 $ (125,533 ) $ 299,500 $ (121,957 ) Component repair programs (CRPs) Up to 30 111,839 (23,404 ) 111,839 (21,895 ) Customer relationships 10-16 338,366 (84,496 ) 338,366 (79,439 ) Patents and technology 4-14 125,852 (62,600 ) 125,852 (59,205 ) Trademarks/trade names 10-30 11,950 (10,830 ) 11,950 (10,731 ) Other Up to 15 7,296 (3,662 ) 7,296 (3,551 ) 894,803 (310,525 ) 894,803 (296,778 ) Unamortized intangible assets: Trade names 55,670 — 55,670 — Foreign currency translation (22,386 ) — (17,157 ) — Other intangible assets $ 928,087 $ (310,525 ) $ 933,316 $ (296,778 ) |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Long-term debt and notes and overdrafts payable at March 31, 2019 and December 31, 2018 consisted of: March 31, 2019 December 31, 2018 Carrying Amount Fair Value Carrying Amount Fair Value Revolving credit agreement $ 772,737 $ 788,492 $ 831,016 $ 828,800 3.97% Senior Notes 100,000 102,504 100,000 100,185 Borrowings under lines of credit and overdrafts 23,051 23,051 2,137 2,137 Capital leases 9,400 9,563 10,216 10,503 Other foreign bank borrowings 634 638 647 651 905,822 924,248 944,016 942,276 Less current maturities (28,282 ) (7,659 ) Long-term debt $ 877,540 $ 936,357 |
Derivatives (Tables)
Derivatives (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The following table sets forth the fair value amounts of derivative instruments held by the Company. Derivative Assets Derivative Liabilities Fair Value Fair Value Balance Sheet Location March 31, 2019 December 31, 2018 Balance Sheet Location March 31, 2019 December 31, 2018 Derivatives designated as hedging instruments: Interest rate contracts Other assets $ 773 $ 1,412 Other liabilities $ — $ — Foreign exchange contracts Prepaid expenses and other current assets — — Accrued liabilities (361 ) (258 ) Total derivatives designated as hedging instruments 773 1,412 (361 ) (258 ) Derivatives not designated as hedging instruments: Foreign exchange contracts Prepaid expenses and other current assets 20 1,105 Accrued liabilities (949 ) (90 ) Total derivatives not designated as hedging instruments 20 1,105 (949 ) (90 ) Total derivatives $ 793 $ 2,517 $ (1,310 ) $ (348 ) |
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) | The following table sets forth the effect of hedge accounting on accumulated other comprehensive (loss) income for the three -month periods ended March 31, 2019 and 2018 : Amount of (Loss) Gain Recognized in Accumulated Other Comprehensive (Loss) Income on Derivative Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income Three months ended March 31, Three months ended March 31, Derivatives in Hedging Relationships 2019 2018 2019 2018 Derivatives in Cash Flow Hedging Relationships: Interest rate contracts $ (487 ) $ 1,235 Interest expense $ 142 $ (82 ) Foreign exchange contracts (81 ) (839 ) Net sales (337 ) (226 ) Total $ (568 ) $ 396 $ (195 ) $ (308 ) |
Schedule of Fair Value Hedging Instruments, Statements of Financial Performance and Financial Position, Location | The following table sets forth the effect of hedge accounting on the consolidated statements of income for the three -month periods ended March 31, 2019 and 2018 : Location and Amount of Gain (Loss) Recognized in Income on Hedging Relationships Three months ended March 31, 2019 2018 Net sales Interest expense Net sales Interest expense Total amounts of income and expense line items presented in the consolidated statements of income in which the effects of hedges are recorded $ 376,692 $ 5,113 $ 366,660 $ 3,892 The effects of hedging: Gain (Loss) on cash flow hedging relationships Interest rate contracts Amount of gain (loss) reclassified from accumulated other comprehensive income (loss) into income 142 (82 ) Foreign exchange contracts Amount of gain (loss) reclassified from accumulated other comprehensive income (loss) into income (337 ) (226 ) |
Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location | The following table sets forth the effect of derivatives not designated as hedging instruments on the consolidated statements of income for the three -month periods ended March 31, 2019 and 2018 . Location of Gain (Loss) Recognized in Income on Derivative Amount of Gain (Loss) Recognized in Income on Derivative (A) Three months ended March 31, Derivatives Not Designated as Hedging Instruments 2019 2018 Foreign exchange contracts Other expense (income), net $ (3,819 ) $ (6,092 ) (A) Such amounts were substantially offset by the net (gain) loss recorded on the underlying hedged asset or liability, also recorded in other expense (income), net. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table provides the assets and liabilities reported at fair value and measured on a recurring basis: Fair Value Measurements Using Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) March 31, 2019 Asset derivatives $ 793 $ — $ 793 $ — Liability derivatives (1,310 ) — (1,310 ) — Bank acceptances 10,212 — 10,212 — Rabbi trust assets 2,704 2,704 — — $ 12,399 $ 2,704 $ 9,695 $ — December 31, 2018 Asset derivatives $ 2,517 $ — $ 2,517 $ — Liability derivatives (348 ) — (348 ) — Bank acceptances 17,698 — 17,698 — Rabbi trust assets 2,457 2,457 — — $ 22,324 $ 2,457 $ 19,867 $ — |
Pension and Other Postretirem_2
Pension and Other Postretirement Benefits (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Retirement Benefits [Abstract] | |
Schedule of Net Benefit Costs | Pension and other postretirement benefits expenses consisted of the following: Three months ended March 31, Pensions 2019 2018 Service cost $ 1,433 $ 1,590 Interest cost 4,536 4,309 Expected return on plan assets (7,078 ) (7,394 ) Amortization of prior service cost 103 141 Amortization of actuarial losses 2,158 2,811 Net periodic benefit cost $ 1,152 $ 1,457 Three months ended March 31, Other Postretirement Benefits 2019 2018 Service cost $ 19 $ 24 Interest cost 340 344 Amortization of prior service cost 6 5 Amortization of actuarial losses 10 160 Net periodic benefit cost $ 375 $ 533 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
ROU assets and lease liabilities | The following table sets forth the classification of ROU assets and lease liabilities on the Consolidated Balance Sheets: Operating Leases Classification March 31, 2019 Leased Assets ROU assets Other assets $ 33,316 Lease Liabilities Current lease liability Accrued liabilities 10,689 Long term lease liability Other liabilities 23,470 $ 34,159 |
Future minimum lease payments | Future minimum lease payments under non-cancellable leases as of March 31, 2019 were as follows: Operating Leases 2019 $ 9,266 2020 9,582 2021 6,995 2022 3,251 2023 2,453 After 2023 7,688 Total lease payments $ 39,235 Less: Interest 5,076 Present value of lease payments $ 34,159 |
Lease Term and Discount Rate | Lease Term and Discount Rate March 31, 2019 Weighted-average remaining lease term (years) Operating leases 6.2 Weighted-average discount rate Operating leases 3.97 % |
Other Information | Other Information March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 3,363 Leased assets obtained in exchange for new operating lease liabilities $ 4,563 |
Changes in Accumulated Other _2
Changes in Accumulated Other Comprehensive Income (Loss) by Component (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Changes in Accumulated Other Comprehensive Income (Loss) By Component | The following tables sets forth the changes in accumulated other comprehensive income (loss), net of tax, by component for the three -month periods ended March 31, 2019 and 2018 : Gains and Losses on Cash Flow Hedges Pension and Other Postretirement Benefit Items Foreign Currency Items Total January 1, 2019 $ 834 $ (138,690 ) $ (52,644 ) $ (190,500 ) Other comprehensive (loss) income before reclassifications (723 ) (122 ) (9,225 ) (10,070 ) Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income 155 1,737 — 1,892 Net current-period other comprehensive income (568 ) 1,615 (9,225 ) (8,178 ) March 31, 2019 $ 266 $ (137,075 ) $ (61,869 ) $ (198,678 ) Gains and Losses on Cash Flow Hedges Pension and Other Postretirement Benefit Items Foreign Currency Items Total January 1, 2018 $ 72 $ (103,844 ) $ (2,627 ) $ (106,399 ) Other comprehensive income before reclassifications 157 763 26,953 27,873 Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income 239 2,401 — 2,640 Net current-period other comprehensive income 396 3,164 26,953 30,513 Amounts reclassified from accumulated other comprehensive income to retained earnings (A) — (19,331 ) — (19,331 ) March 31, 2018 $ 468 $ (120,011 ) $ 24,326 $ (95,217 ) (A) This amount represents the reclassification of stranded tax effects resulting from the Act, as permitted by amended guidance issued by the FASB in February 2018. See Note 3 of the Consolidated Financial Statements. |
Schedule of Amounts Reclassified Out of Accumulated Other Comprehensive Income (Loss) to the Consolidated Statements of Income | The following table sets forth the reclassifications out of accumulated other comprehensive income (loss) by component for the three -month periods ended March 31, 2019 and 2018 : Details about Accumulated Other Comprehensive Income (Loss) Components Amount Reclassified from Accumulated Other Comprehensive Income (Loss) Affected Line Item in the Consolidated Statements of Income Three months ended March 31, 2019 Three months ended March 31, 2018 Gains and losses on cash flow hedges Interest rate contracts $ 142 $ (82 ) Interest expense Foreign exchange contracts (337 ) (226 ) Net sales (195 ) (308 ) Total before tax 40 69 Tax benefit (155 ) (239 ) Net of tax Pension and other postretirement benefit items Amortization of prior-service costs $ (109 ) $ (146 ) (A) Amortization of actuarial losses (2,168 ) (2,971 ) (A) (2,277 ) (3,117 ) Total before tax 540 716 Tax benefit (1,737 ) (2,401 ) Net of tax Total reclassifications in the period $ (1,892 ) $ (2,640 ) (A) These accumulated other comprehensive income (loss) components are included within the computation of net periodic Pension and Other Postretirement Benefits cost. See Note 12 of the Consolidated Financial Statements. |
Information on Business Segme_2
Information on Business Segments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following tables set forth information about the Company's operations by its two reportable segments: Three months ended March 31, 2019 2018 Net sales Industrial $ 242,502 $ 245,967 Aerospace 134,190 120,699 Intersegment sales — (6 ) Total net sales $ 376,692 $ 366,660 Operating profit Industrial $ 21,502 $ 32,378 Aerospace 29,147 24,255 Total operating profit 50,649 56,633 Interest expense 5,113 3,892 Other expense (income), net 1,806 1,763 Income before income taxes $ 43,730 $ 50,978 March 31, 2019 December 31, 2018 Assets Industrial $ 1,934,014 $ 1,962,362 Aerospace 706,633 692,584 Other (A) 159,028 154,024 Total assets $ 2,799,675 $ 2,808,970 (A) "Other" assets include corporate-controlled assets, the majority of which are cash and cash equivalents. |
Acquisitions (Details)
Acquisitions (Details) - Gimatic and IGS [Member] $ in Thousands | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Business Acquisition [Line Items] | |
Net Sales | $ 386,562 |
Net Income | $ 37,294 |
Recent Accounting Standards (De
Recent Accounting Standards (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | Mar. 31, 2018 |
Accounting Changes and Error Corrections [Abstract] | ||||
ROU assets | $ 33,316 | $ 31,724 | ||
Lease liability | 34,159 | $ 32,579 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Retained earnings | $ 1,389,438 | $ 1,363,772 | ||
Accounting Standards Update 2018-02 [Member] | New Accounting Pronouncement, Early Adoption, Effect [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Retained earnings | $ 19,331 |
Revenue - Revenue by Category (
Revenue - Revenue by Category (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | $ 376,692 | $ 366,660 |
Industrial [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 242,502 | 245,961 |
Aerospace [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 134,190 | 120,699 |
Americas [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 194,432 | 182,488 |
Americas [Member] | Industrial [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 98,288 | 96,527 |
Americas [Member] | Aerospace [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 96,144 | 85,961 |
Europe [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 118,754 | 118,815 |
Europe [Member] | Industrial [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 94,430 | 94,140 |
Europe [Member] | Aerospace [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 24,324 | 24,675 |
Asia [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 61,346 | 63,293 |
Asia [Member] | Industrial [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 48,942 | 54,380 |
Asia [Member] | Aerospace [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 12,404 | 8,913 |
Other Geographic Market [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 2,160 | 2,064 |
Other Geographic Market [Member] | Industrial [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 842 | 914 |
Other Geographic Market [Member] | Aerospace [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 1,318 | 1,150 |
Engineered Components Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 69,684 | 77,090 |
Engineered Components Products [Member] | Industrial [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 69,684 | 77,090 |
Engineered Components Products [Member] | Aerospace [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 0 | 0 |
Molding Solutions Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 106,793 | 119,099 |
Molding Solutions Products [Member] | Industrial [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 106,793 | 119,099 |
Molding Solutions Products [Member] | Aerospace [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 0 | 0 |
Force & Motion Control Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 51,617 | 49,772 |
Force & Motion Control Products [Member] | Industrial [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 51,617 | 49,772 |
Force & Motion Control Products [Member] | Aerospace [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 0 | 0 |
Automation Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 14,408 | 0 |
Automation Products [Member] | Industrial [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 14,408 | 0 |
Automation Products [Member] | Aerospace [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 0 | 0 |
Aerospace Original Equipment Manufacturing Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 87,939 | 80,695 |
Aerospace Original Equipment Manufacturing Products [Member] | Industrial [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 0 | 0 |
Aerospace Original Equipment Manufacturing Products [Member] | Aerospace [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 87,939 | 80,695 |
Aerospace Aftermarket Products and Services [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 46,251 | 40,004 |
Aerospace Aftermarket Products and Services [Member] | Industrial [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 0 | 0 |
Aerospace Aftermarket Products and Services [Member] | Aerospace [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | $ 46,251 | $ 40,004 |
Transferred at Point in Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue transfered percent | 90.00% | |
Transferred over Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue transfered percent | 10.00% |
Revenue - Contract Balances (De
Revenue - Contract Balances (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Dec. 31, 2018 | Jan. 01, 2018 | |
Revenue from Contract with Customer [Abstract] | |||
Unbilled receivables (contract assets) | $ 17,501 | $ 11,844 | |
Unbilled receivables (contract assets), $ Change | $ 5,657 | ||
Unbilled receivables (contract assets), % Change | 48.00% | ||
Contract liabilities | $ (56,606) | (57,522) | |
Contract liabilities, $ Change | $ 916 | ||
Contract liabilities, % Change | (2.00%) | ||
Net contract liabilities | $ (39,105) | $ (45,678) | |
Net contract liabilities, $ Change | $ 6,573 | ||
Net contract liabilities, % Change | (14.00%) | ||
Customer advances | $ 14,243 | $ 15,348 | |
Percent of liability revenue recognized | 35.00% |
Revenue - Contract Costs (Detai
Revenue - Contract Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Capitalized Contract Cost [Line Items] | |||
Amortization of capitalized costs | $ 3,434 | $ 3,986 | |
Capitalized costs, net | 8,339 | $ 8,445 | |
Tooling [Member] | |||
Capitalized Contract Cost [Line Items] | |||
Capitalized costs, net | 6,058 | 6,155 | |
Design Costs [Member] | |||
Capitalized Contract Cost [Line Items] | |||
Capitalized costs, net | 2,281 | 2,285 | |
Other Capitalized Contract Cost [Member] | |||
Capitalized Contract Cost [Line Items] | |||
Capitalized costs, net | $ 0 | $ 5 |
Revenue - Remaining Performance
Revenue - Remaining Performance Obligations (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 228,536 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, expected timing | 1 year |
Remaining performance obligations, percentage | 80.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, expected timing | 2 years |
Remaining performance obligations, percentage | 20.00% |
Stockholders Equity (Details)
Stockholders Equity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | $ 1,203,056 | $ 1,260,321 |
Comprehensive income | 25,814 | 69,331 |
Dividends declared | $ (8,217) | $ (7,453) |
Dividends declared (in dollars per share) | $ 0.16 | $ 0.14 |
Common stock repurchases | $ (33,541) | |
Reclassification pursuant to accounting guidance related to U.S. Tax Reform (Note 3) | 0 | |
Cumulative effect of change in accounting guidance related to Revenue (Note 3) | 4,295 | |
Employee stock plans | $ 3,850 | 2,633 |
Balance | 1,224,503 | 1,295,586 |
Common Stock | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | $ 634 | $ 630 |
Balance (in shares) | 63,367 | 63,034 |
Employee stock plans | $ 1 | |
Employee stock plans (in shares) | 51 | 20 |
Balance | $ 634 | $ 631 |
Balance (in shares) | 63,418 | 63,054 |
Additional Paid-In Capital | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | $ 470,818 | $ 457,365 |
Employee stock plans | 4,039 | 2,874 |
Balance | 474,857 | 460,239 |
Treasury Stock | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | $ 441,668 | $ 297,998 |
Balance (in shares) | 12,034 | 9,656 |
Common stock repurchases | $ (33,541) | |
Common stock repurchases (in shares) | 533 | |
Employee stock plans | $ 80 | $ 68 |
Employee stock plans (in shares) | 1 | 1 |
Balance | $ 441,748 | $ 331,607 |
Balance (in shares) | 12,035 | 10,190 |
Retained Earnings | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | $ 1,363,772 | $ 1,206,723 |
Comprehensive income | 33,992 | 38,818 |
Dividends declared | (8,217) | (7,453) |
Reclassification pursuant to accounting guidance related to U.S. Tax Reform (Note 3) | 19,331 | |
Cumulative effect of change in accounting guidance related to Revenue (Note 3) | 4,295 | |
Employee stock plans | (109) | (174) |
Balance | 1,389,438 | 1,261,540 |
Accumulated Other Non-Owner Changes to Equity | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | (190,500) | (106,399) |
Comprehensive income | (8,178) | 30,513 |
Reclassification pursuant to accounting guidance related to U.S. Tax Reform (Note 3) | (19,331) | |
Balance | $ (198,678) | $ (95,217) |
Net Income Per Common Share (De
Net Income Per Common Share (Details) - shares | 1 Months Ended | 3 Months Ended | |
Feb. 28, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Net Income Per Common Share [Line Items] | |||
Weighted average number of diluted shares outstanding adjustment (in shares) | 528,661 | 553,903 | |
Stock Options [Member] | |||
Net Income Per Common Share [Line Items] | |||
Antidilutive securities excluded from computation of EPS (in shares) | 221,201 | 153,908 | |
Options, granted (in shares) | 120,585 | ||
Restricted Stock Units (RSUs) [Member] | |||
Net Income Per Common Share [Line Items] | |||
Other than options, granted (in shares) | 93,992 | ||
Performance Share Awards [Member] | |||
Net Income Per Common Share [Line Items] | |||
Other than options, granted (in shares) | 88,402 | ||
Performance period | 3 years | ||
Minimum range of target award of stock plan | 0.00% | ||
Maximum range of target award of stock plan | 250.00% |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 84,965 | $ 87,779 |
Work-in-process | 96,146 | 98,426 |
Raw material and supplies | 76,138 | 79,785 |
Inventories | $ 257,249 | $ 265,990 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Goodwill: | ||
Goodwill, beginning of period | $ 955,524 | |
Acquisition related | 681 | |
Foreign currency translation | (11,396) | |
Goodwill, end of period | 944,809 | |
Other Intangible Assets: | ||
Gross Amount | 894,803 | $ 894,803 |
Accumulated Amortization | (310,525) | (296,778) |
Foreign currency translation | (22,386) | (17,157) |
Other intangible assets | 928,087 | 933,316 |
Intangible Assets, Future Amortization Expense | ||
Amortization of intangible assets expected, remainder of fiscal year | 53,000 | |
Amortization of intangible assets expected in year 2 | 50,000 | |
Amortization of intangible assets expected in year 3 | 49,000 | |
Amortization of intangible assets expected in year 4 | 49,000 | |
Amortization of intangible assets expected in year 5 | 48,000 | |
Trade name [Member] | ||
Other Intangible Assets: | ||
Unamortized intangible asset | 55,670 | 55,670 |
Revenue sharing programs (RSPs) [Member] | ||
Other Intangible Assets: | ||
Gross Amount | 299,500 | 299,500 |
Accumulated Amortization | (125,533) | (121,957) |
Component repair programs (CRPs) [Member] | ||
Other Intangible Assets: | ||
Gross Amount | 111,839 | 111,839 |
Accumulated Amortization | (23,404) | (21,895) |
Customer lists/relationships [Member] | ||
Other Intangible Assets: | ||
Gross Amount | 338,366 | 338,366 |
Accumulated Amortization | (84,496) | (79,439) |
Patents and technology [Member] | ||
Other Intangible Assets: | ||
Gross Amount | 125,852 | 125,852 |
Accumulated Amortization | (62,600) | (59,205) |
Trademarks/trade names [Member] | ||
Other Intangible Assets: | ||
Gross Amount | 11,950 | 11,950 |
Accumulated Amortization | (10,830) | (10,731) |
Other [Member] | ||
Other Intangible Assets: | ||
Gross Amount | 7,296 | 7,296 |
Accumulated Amortization | (3,662) | $ (3,551) |
Industrial [Member] | ||
Goodwill: | ||
Goodwill, beginning of period | 924,738 | |
Acquisition related | 681 | |
Foreign currency translation | (11,396) | |
Goodwill, end of period | 914,023 | |
Aerospace [Member] | ||
Goodwill: | ||
Goodwill, beginning of period | 30,786 | |
Acquisition related | 0 | |
Foreign currency translation | 0 | |
Goodwill, end of period | $ 30,786 | |
Minimum [Member] | Customer lists/relationships [Member] | ||
Other Intangible Assets: | ||
Range of life | 10 years | |
Minimum [Member] | Patents and technology [Member] | ||
Other Intangible Assets: | ||
Range of life | 4 years | |
Minimum [Member] | Trademarks/trade names [Member] | ||
Other Intangible Assets: | ||
Range of life | 10 years | |
Maximum [Member] | Revenue sharing programs (RSPs) [Member] | ||
Other Intangible Assets: | ||
Range of life | 30 years | |
Maximum [Member] | Component repair programs (CRPs) [Member] | ||
Other Intangible Assets: | ||
Range of life | 30 years | |
Maximum [Member] | Customer lists/relationships [Member] | ||
Other Intangible Assets: | ||
Range of life | 16 years | |
Maximum [Member] | Patents and technology [Member] | ||
Other Intangible Assets: | ||
Range of life | 14 years | |
Maximum [Member] | Trademarks/trade names [Member] | ||
Other Intangible Assets: | ||
Range of life | 30 years | |
Maximum [Member] | Other [Member] | ||
Other Intangible Assets: | ||
Range of life | 15 years |
Debt (Debt Schedule) (Details)
Debt (Debt Schedule) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Fair value of debt | $ 924,248 | $ 942,276 |
Total debt, net of unamortized discounts | 905,822 | 944,016 |
Borrowings under lines of credit and overdrafts | 23,051 | 2,137 |
Less current maturities | (28,282) | (7,659) |
Long-term debt | 877,540 | 936,357 |
Revolving Credit Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Carrying amount of debt | 772,737 | 831,016 |
Fair value of debt | 788,492 | 828,800 |
Senior Notes [Member] | 3.97% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Carrying amount of debt | 100,000 | 100,000 |
Fair value of debt | 102,504 | 100,185 |
Lines of Credit and Overdrafts [Member] | ||
Debt Instrument [Line Items] | ||
Fair value of debt | 23,051 | 2,137 |
Borrowings under lines of credit and overdrafts | 23,051 | 2,137 |
Capital Lease Obligations [Member] | ||
Debt Instrument [Line Items] | ||
Carrying amount of debt | 9,400 | 10,216 |
Fair value of debt | 9,563 | 10,503 |
Foreign Bank Borrowings [Member] | ||
Debt Instrument [Line Items] | ||
Carrying amount of debt | 634 | 647 |
Fair value of debt | $ 638 | $ 651 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) € in Thousands | Sep. 19, 2018USD ($) | Oct. 31, 2018 | Mar. 31, 2019EUR (€) | Dec. 31, 2018USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018EUR (€) | Dec. 31, 2018USD ($) | Oct. 19, 2018USD ($) | Dec. 31, 2017USD ($) | Feb. 28, 2017USD ($) | Oct. 31, 2014USD ($) |
Debt Instrument [Line Items] | |||||||||||
Borrowings under lines of credit and overdrafts | $ 23,051,000 | $ 2,137,000 | |||||||||
Debt covenant ratio of senior debt to EBITDA | 3.25 | 3.25 | |||||||||
Debt covenant ratio of total debt to EBITDA | 3.75 | 3.75 | |||||||||
Debt covenant ratio of EBITDA to cash interest expense | 4.25 | 4.25 | |||||||||
Revolving Credit Agreement [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Carrying amount of debt | $ 772,737,000 | 831,016,000 | |||||||||
Line of credit facility, maximum borrowing capacity | $ 750,000,000 | ||||||||||
Line of credit facility with accordian feature, maximum borrowing capacity | $ 250,000,000 | ||||||||||
Remaining borrowing capacity | 227,263,000 | 168,984,000 | |||||||||
Revolving Credit Agreement [Member] | Euro Member Countries, Euro | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Carrying amount of debt | € 490,080 | $ 550,237,000 | € 470,350 | $ 538,316,000 | |||||||
Stated interest rate | 1.82% | 1.82% | 1.99% | 1.99% | |||||||
Revolving Credit Agreement [Member] | International Subsidiary Borrowings [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Carrying amount of debt | € 44,100 | $ 49,506,000 | € 179,000 | $ 208,589,000 | |||||||
Senior Notes [Member] | 3.97% Senior Notes [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Carrying amount of debt | 100,000,000 | 100,000,000 | |||||||||
Stated interest rate | 3.97% | ||||||||||
Converted amount with accrued interest | $ 100,000,000 | ||||||||||
Percent allowed to be prepaid | 100.00% | ||||||||||
Lines of Credit [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Borrowings under lines of credit and overdrafts | 23,000,000 | $ 2,041,000 | |||||||||
Line of credit facility, maximum borrowing capacity | $ 87,000,000 | ||||||||||
Line of credit, interest rate at period end | 3.21% | 3.21% | 0.17% | 0.17% | |||||||
Bank Overdrafts [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Borrowings under lines of credit and overdrafts | $ 51,000 | $ 96,000 | |||||||||
Repayment period | 2 days | ||||||||||
Capital Lease Obligations [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Carrying amount of debt | 9,400,000 | 10,216,000 | |||||||||
Foreign Bank Borrowings [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Carrying amount of debt | 634,000 | $ 647,000 | |||||||||
Revolving Credit Agreement [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Covenant, Threshold for Permitted Acquisition | $ 150,000,000 | ||||||||||
Debt Instrument, Covenant, Material Acquisition, Consolidated Senior Credit to Consolidated EBITDA | 3.50 | 3.50 | |||||||||
Debt Instrument, Covenant, Material Acquisition, Total Consolidated Debt to Consolidated EBITDA | 4.25 | 4.25 | |||||||||
Revolving Credit Agreement [Member] | Fourth Amendment, Maturity February 2022 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of credit facility, maximum borrowing capacity | $ 850,000,000 | ||||||||||
Revolving Credit Agreement [Member] | Fourth Amendment, Maturity February 2022 [Member] | Euro Member Countries, Euro | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of credit facility, maximum borrowing capacity | 600,000,000 | ||||||||||
Revolving Credit Agreement [Member] | Fourth Amendment, Maturity February 2022 [Member] | Euribor [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Stated interest rate | 0.00% | ||||||||||
Revolving Credit Agreement [Member] | Fifth Amendment, Maturity February 2022 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of credit facility, maximum borrowing capacity | $ 1,000,000,000 | ||||||||||
Line of credit facility with accordian feature, maximum borrowing capacity | $ 200,000,000 | ||||||||||
Debt fees and expenses | $ 529,000 | ||||||||||
Revolving Credit Agreement [Member] | Fifth Amendment, Maturity February 2022 [Member] | one-month LIBOR [Member] | Minimum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Variable basis spread | 1.10% | ||||||||||
Revolving Credit Agreement [Member] | Fifth Amendment, Maturity February 2022 [Member] | one-month LIBOR [Member] | Maximum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Variable basis spread | 1.70% | ||||||||||
Revolving Credit Agreement [Member] | Fifth Amendment, Maturity February 2022 [Member] | Base Rate [Member] | Minimum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Variable basis spread | 0.10% | ||||||||||
Revolving Credit Agreement [Member] | Fifth Amendment, Maturity February 2022 [Member] | Base Rate [Member] | Maximum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Variable basis spread | 0.70% | ||||||||||
Revolving Credit Agreement [Member] | Fifth Amendment, Maturity February 2022 [Member] | Euribor [Member] | Minimum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Variable basis spread | 1.10% | ||||||||||
Revolving Credit Agreement [Member] | Fifth Amendment, Maturity February 2022 [Member] | Euribor [Member] | Maximum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Variable basis spread | 1.70% | ||||||||||
Revolving Credit Agreement [Member] | Fourth Amendment, Maturity February 2022, Accordion Feature [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of credit facility, maximum borrowing capacity | $ 350,000,000 | ||||||||||
SPA with Gimatic [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Business Combination, Consideration Transferred, Liabilities Incurred | $ 150,000,000 |
Derivatives (Details)
Derivatives (Details) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | Apr. 28, 2017USD ($)Bank | |
Derivative [Line Items] | ||||
Net cash payments from settlement | $ (1,340) | $ (6,546) | ||
Maximum remaining maturity of foreign currency derivatives | 2 years | |||
Derivative Assets | $ 793 | $ 2,517 | ||
Derivative Liabilities | (1,310) | (348) | ||
Net sales | 376,692 | 366,660 | ||
Interest expense | 5,113 | 3,892 | ||
Foreign Exchange Contract [Member] | ||||
Derivative [Line Items] | ||||
Net cash payments from settlement | 1,299 | 6,505 | ||
Designated as Hedging Instrument [Member] | ||||
Derivative [Line Items] | ||||
Derivative Assets | 773 | 1,412 | ||
Derivative Liabilities | (361) | (258) | ||
Designated as Hedging Instrument [Member] | Interest Rate Contract [Member] | ||||
Derivative [Line Items] | ||||
Derivative Assets | 773 | 1,412 | ||
Derivative Liabilities | 0 | 0 | ||
Designated as Hedging Instrument [Member] | Foreign Exchange Contract [Member] | ||||
Derivative [Line Items] | ||||
Derivative Assets | 0 | 0 | ||
Derivative Liabilities | (361) | (258) | ||
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||||
Derivative [Line Items] | ||||
Amount of (Loss) Gain Recognized in Accumulated Other Comprehensive (Loss) Income on Derivative | (568) | 396 | ||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | (195) | (308) | ||
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Interest Rate Contract [Member] | ||||
Derivative [Line Items] | ||||
Amount of (Loss) Gain Recognized in Accumulated Other Comprehensive (Loss) Income on Derivative | (487) | 1,235 | ||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | 142 | (82) | ||
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Foreign Exchange Contract [Member] | ||||
Derivative [Line Items] | ||||
Amount of (Loss) Gain Recognized in Accumulated Other Comprehensive (Loss) Income on Derivative | (81) | (839) | ||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | (337) | (226) | ||
Not Designated as Hedging Instrument [Member] | ||||
Derivative [Line Items] | ||||
Derivative Assets | 20 | 1,105 | ||
Derivative Liabilities | (949) | (90) | ||
Not Designated as Hedging Instrument [Member] | Foreign Exchange Contract [Member] | ||||
Derivative [Line Items] | ||||
Derivative Assets | 20 | 1,105 | ||
Derivative Liabilities | (949) | $ (90) | ||
Amount of Gain (Loss) Recognized in Income on Derivatives | $ (3,819) | $ (6,092) | ||
Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||||
Derivative [Line Items] | ||||
Number of banks transacted with for interest rate swap agreements (in banks) | Bank | 1 | |||
Fixed interest rate | 1.92% | |||
Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | one-month LIBOR [Member] | ||||
Derivative [Line Items] | ||||
Derivative amount of hedge | $ 100,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Asset derivatives | $ 793 | $ 2,517 |
Liability derivatives | (1,310) | (348) |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Asset derivatives | 0 | 0 |
Liability derivatives | 0 | 0 |
Bank acceptances | 0 | 0 |
Rabbi trust assets | 2,704 | 2,457 |
Financial assets and financial liabilities, reported at fair value | 2,704 | 2,457 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Asset derivatives | 793 | 2,517 |
Liability derivatives | (1,310) | (348) |
Bank acceptances | 10,212 | 17,698 |
Rabbi trust assets | 0 | 0 |
Financial assets and financial liabilities, reported at fair value | 9,695 | 19,867 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Asset derivatives | 0 | 0 |
Liability derivatives | 0 | 0 |
Bank acceptances | 0 | 0 |
Rabbi trust assets | 0 | 0 |
Financial assets and financial liabilities, reported at fair value | 0 | 0 |
Estimate of Fair Value, Fair Value Disclosure [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Asset derivatives | 793 | 2,517 |
Liability derivatives | (1,310) | (348) |
Bank acceptances | 10,212 | 17,698 |
Rabbi trust assets | 2,704 | 2,457 |
Financial assets and financial liabilities, reported at fair value | $ 12,399 | $ 22,324 |
Minimum [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Maturity of bank acceptances | 3 months | |
Maximum [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Maturity of bank acceptances | 6 months |
Pension and Other Postretirem_3
Pension and Other Postretirement Benefits (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Pensions [Member] | ||
Pension and other postretirement benefits expenses | ||
Service cost | $ 1,433 | $ 1,590 |
Interest cost | 4,536 | 4,309 |
Expected return on plan assets | (7,078) | (7,394) |
Amortization of prior service cost (credit) | 103 | 141 |
Amortization of actuarial losses | 2,158 | 2,811 |
Net periodic benefit cost | 1,152 | 1,457 |
Other Postretirement Benefits [Member] | ||
Pension and other postretirement benefits expenses | ||
Service cost | 19 | 24 |
Interest cost | 340 | 344 |
Amortization of prior service cost (credit) | 6 | 5 |
Amortization of actuarial losses | 10 | 160 |
Net periodic benefit cost | $ 375 | $ 533 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Effective tax rate | 22.30% | 23.90% | 19.90% |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | |
Lessee, Lease, Description [Line Items] | |||
ROU assets | $ 33,316 | $ 31,724 | |
Current lease liability | 10,689 | ||
Long term lease liability | 23,470 | ||
Lease Liabilities | 34,159 | $ 32,579 | |
Operating lease cost | 3,943 | ||
Minimum rental commitments 2019 | $ 11,931 | ||
Minimum rental commitments 2020 | 8,322 | ||
Minimum rental commitments 2021 | 5,888 | ||
Minimum rental commitments 2022 | 2,898 | ||
Minimum rental commitments 2023 | 2,064 | ||
Minimum rental commitments thereafter | $ 7,659 | ||
Future minimum lease payments 2019 | 9,266 | ||
Future minimum lease payments 2020 | 9,582 | ||
Future minimum lease payments 2021 | 6,995 | ||
Future minimum lease payments 2022 | 3,251 | ||
Future minimum lease payments 2023 | 2,453 | ||
Future minimum lease payments after 2023 | 7,688 | ||
Total lease payments | 39,235 | ||
Less: Interest | $ 5,076 | ||
Weighted-average remaining lease term (years) | 6 years 2 months 12 days | ||
Weighted-average discount rate | 3.97% | ||
Operating cash flows from operating leases | $ 3,363 | ||
Leased assets obtained in exchange for new operating lease liabilities | $ 4,563 | ||
Minimum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 1 year | ||
Renewal periods | 1 year | ||
Maximum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 10 years | ||
Renewal periods | 5 years |
Changes in Accumulated Other _3
Changes in Accumulated Other Comprehensive Income (Loss) by Component (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | |
Feb. 28, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Changes in Accumulated Other Comprehensive Income by Component [Roll Forward] | |||
Accumulated other comprehensive income (loss) | $ (190,500) | $ (106,399) | |
Other comprehensive (loss) income before reclassifications | (10,070) | 27,873 | |
Amounts reclassified from accumulated other comprehensive income | $ (19,331) | 1,892 | 2,640 |
Net current-period other comprehensive income | (8,178) | 30,513 | |
Accumulated other comprehensive income (loss) | (198,678) | (95,217) | |
Gains and Losses on Cash Flow Hedges | |||
Changes in Accumulated Other Comprehensive Income by Component [Roll Forward] | |||
Accumulated other comprehensive income (loss) | 834 | 72 | |
Other comprehensive (loss) income before reclassifications | (723) | 157 | |
Amounts reclassified from accumulated other comprehensive income | 0 | 155 | 239 |
Net current-period other comprehensive income | (568) | 396 | |
Accumulated other comprehensive income (loss) | 266 | 468 | |
Pension and Other Postretirement Benefit Items | |||
Changes in Accumulated Other Comprehensive Income by Component [Roll Forward] | |||
Accumulated other comprehensive income (loss) | (138,690) | (103,844) | |
Other comprehensive (loss) income before reclassifications | (122) | 763 | |
Amounts reclassified from accumulated other comprehensive income | (19,331) | 1,737 | 2,401 |
Net current-period other comprehensive income | 1,615 | 3,164 | |
Accumulated other comprehensive income (loss) | (137,075) | (120,011) | |
Foreign Currency Items | |||
Changes in Accumulated Other Comprehensive Income by Component [Roll Forward] | |||
Accumulated other comprehensive income (loss) | (52,644) | (2,627) | |
Other comprehensive (loss) income before reclassifications | (9,225) | 26,953 | |
Amounts reclassified from accumulated other comprehensive income | $ 0 | 0 | 0 |
Net current-period other comprehensive income | (9,225) | 26,953 | |
Accumulated other comprehensive income (loss) | $ (61,869) | $ 24,326 |
Changes in Accumulated Other _4
Changes in Accumulated Other Comprehensive Income (Loss) by Component (Details 2) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Interest expense | $ (5,113) | $ (3,892) |
Net sales | 376,692 | 366,660 |
Income before income taxes | 43,730 | 50,978 |
Tax benefit | (9,738) | (12,160) |
Total reclassifications in the period | 33,992 | 38,818 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Total reclassifications in the period | (1,892) | (2,640) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains and Losses on Cash Flow Hedges | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Income before income taxes | (195) | (308) |
Tax benefit | 40 | 69 |
Income from continuing operations | (155) | (239) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains and Losses on Cash Flow Hedges | Interest Rate Contract [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Interest expense | 142 | (82) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains and Losses on Cash Flow Hedges | Foreign Exchange Contract [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Net sales | (337) | (226) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Pension and Other Postretirement Benefit Items | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Income before income taxes | (2,277) | (3,117) |
Tax benefit | 540 | 716 |
Income from continuing operations | (1,737) | (2,401) |
Amortization of prior-service credits, net | (109) | (146) |
Amortization of actuarial losses | $ (2,168) | $ (2,971) |
Information on Business Segme_3
Information on Business Segments (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($)Segment | Mar. 31, 2018USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | Segment | 2 | |
Net sales | $ 376,692 | $ 366,660 |
Operating profit | 50,649 | 56,633 |
Interest expense | 5,113 | 3,892 |
Other expense (income), net | 1,806 | 1,763 |
Income before income taxes | 43,730 | 50,978 |
Aerospace [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 134,190 | 120,699 |
Operating profit | 29,147 | 24,255 |
Industrial [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 242,502 | 245,967 |
Operating profit | 21,502 | 32,378 |
Intersegment sales [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | $ 0 | $ (6) |
Information on Business Segme_4
Information on Business Segments Details 1 (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Segment Reporting Information [Line Items] | ||
Assets | $ 2,799,675 | $ 2,808,970 |
Aerospace [Member] | ||
Segment Reporting Information [Line Items] | ||
Assets | 706,633 | 692,584 |
Industrial [Member] | ||
Segment Reporting Information [Line Items] | ||
Assets | 1,934,014 | 1,962,362 |
Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 159,028 | $ 154,024 |