(Mark One) | ||||
þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||
For the fiscal year ended December 31, | ||||
OR | ||||
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||
For the transition period from to |
Ohio | 34-1867219 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
6065 Parkland Boulevard | ||
Cleveland, Ohio | 44124 | |
(Address of principal executive offices) | (Zip Code) |
Title of each class | Name of each exchange on which registered | |
Common Stock, Par Value $1.00 Per Share | The NASDAQ Stock Market LLC |
Large accelerated filer o | Accelerated filer | Non-accelerated filer (Do not check if a smaller reporting company) | Smaller reporting company o |
Item 1. | Business |
Supply Technologies | Aluminum Products | Manufactured Products | ||||
NET SALES FOR | $ ( | $ ( | $ ( | |||
SELECTED PRODUCTS | Sourcing, planning and procurement of over components, including: • Fasteners • Pins • Valves • Hoses • Wire harnesses • Clamps and fittings • Rubber and plastic components | • Control arms • Front engine covers • Cooling modules • Knuckles • Pump housings • Clutch retainers/pistons • Master cylinders • Pinion housings • Oil pans • Flywheel spacers | • Induction heating and melting systems • Pipe threading systems • Industrial oven systems • Injection molded rubber components • Forging presses | |||
SELECTED INDUSTRIES SERVED | • Heavy-duty truck • Automotive and vehicle parts • Electrical distribution and controls • Power sports/fitness equipment • HVAC • Aerospace and defense • Electrical components • Appliance • Semiconductor equipment • Recreational • Lawn and | • Automotive • Agricultural equipment • Construction equipment • Heavy-duty truck • Marine equipment | • Ferrous and non-ferrous metals • Coatings • Forging • Foundry • Heavy-duty truck • Construction equipment • Silicon • Automotive • Oil and gas • Rail and locomotive manufacturing • Aerospace and defense |
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Item 1A. | Risk Factors |
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• | the loss of any | |
• | the insolvency or bankruptcy of any key customer; |
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• | a declining market in which customers reduce orders or demand reduced prices; or | |
• | a strike or work stoppage at a key customer facility, which could affect both their suppliers and customers. |
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• | fluctuations in currency exchange rates; | |
• | limitations on ownership and on repatriation of earnings; | |
• | transportation delays and interruptions; | |
• | political, social and economic instability and disruptions; | |
• | government embargoes or foreign trade restrictions; | |
• | the imposition of duties and tariffs and other trade barriers; | |
• | import and export controls; | |
• | labor unrest and current and changing regulatory environments; | |
• | the potential for nationalization of enterprises; | |
• | disadvantages of competing against companies from countries that are not subject to U.S. laws and regulations including the U.S. Foreign Corrupt Practices Act (“FCPA”) | |
• | difficulties in staffing and managing multinational operations; | |
• | limitations on our ability to enforce legal rights and remedies; and | |
• | potentially adverse tax consequences. |
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Item 1B. | Unresolved Staff Comments |
Item 2. | Properties |
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Related Industry | Owned or | Approximate | Owned or | Approximate | ||||||||||||||||
Segment | Location | Leased | Square Footage | Use | Location | Leased | Square Footage | Use | ||||||||||||
SUPPLY TECHNOLOGIES(1) | Cleveland, OH | Leased | 60,450 | (2) | Supply Technologies Corporate Office | Cleveland, OH | Leased | 60,450 | (2) | Supply Technologies Corporate Office | ||||||||||
Dayton, OH | Leased | 112,960 | Logistics | Dayton, OH | Leased | 70,600 | Logistics | |||||||||||||
Lawrence, PA | Leased | 116,000 | Logistics and Manufacturing | Lawrence, PA | Leased | 116,000 | Logistics and Manufacturing | |||||||||||||
Minneapolis, MN | Leased | 87,100 | Logistics | Minneapolis, MN | Leased | 87,100 | Logistics | |||||||||||||
Allentown, PA | Leased | 62,600 | Logistics | Allentown, PA | Leased | 43,800 | Logistics | |||||||||||||
Atlanta, GA | Leased | 56,000 | Logistics | Atlanta, GA | Leased | 56,000 | Logistics | |||||||||||||
Dallas, TX | Leased | 50,000 | Logistics | Des Plaines, IL | Leased | 45,000 | Logistics | |||||||||||||
Memphis, TN | Leased | 48,750 | Logistics | Memphis, TN | Leased | 48,750 | Logistics | |||||||||||||
Louisville, KY | Leased | 30,000 | Logistics | Louisville, KY | Leased | 30,000 | Logistics | |||||||||||||
Chicago, IL | Leased | 30,000 | Logistics | Nashville, TN | Leased | 44,900 | Logistics | |||||||||||||
Nashville, TN | Leased | 44,900 | Logistics | Tulsa, OK | Leased | 40,000 | Logistics | |||||||||||||
Tulsa, OK | Leased | 40,000 | Logistics | Lenexa, KS | Leased | 38,000 | Logistics | |||||||||||||
Austin, TX | Leased | 30,000 | Logistics | Austin, TX | Leased | 30,000 | Logistics | |||||||||||||
Madison Hts., MI | Leased | 32,000 | Logistics | Madison Hts., MI | Leased | 32,000 | Logistics | |||||||||||||
Streetsboro, OH | Leased | 45,000 | Logistics | Streetsboro, OH | Leased | 45,000 | Logistics | |||||||||||||
Mississauga, Ontario, Canada | Leased | 145,000 | Manufacturing | Mississauga, Ontario, Canada | Leased | 145,000 | Manufacturing | |||||||||||||
Solon, OH | Leased | 54,000 | Logistics | Solon, OH | Leased | 54,000 | Logistics | |||||||||||||
Dublin, VA | Leased | 40,000 | Logistics | Dublin, VA | Leased | 40,000 | Logistics | |||||||||||||
Delaware, OH | Owned | 45,000 | Manufacturing | Delaware, OH | Owned | 45,000 | Manufacturing | |||||||||||||
ALUMINUM | Conneaut, OH(3) | Leased/Owned | 304,000 | Manufacturing | Conneaut, OH(3) | Leased/Owned | 304,000 | Manufacturing | ||||||||||||
PRODUCTS | Huntington, IN | Leased | 125,000 | Manufacturing | Huntington, IN | Leased | 125,000 | Manufacturing | ||||||||||||
Fremont, IN | Owned | 112,000 | Manufacturing | Fremont, IN | Owned | 112,000 | Manufacturing | |||||||||||||
Wapakoneta, OH | Owned | 188,000 | Manufacturing | Wapakoneta, OH | Owned | 188,000 | Manufacturing | |||||||||||||
Rootstown, OH | Owned | 177,000 | Manufacturing | Rootstown, OH | Owned | 177,000 | Manufacturing | |||||||||||||
Ravenna, OH | Owned | 64,000 | Manufacturing | Ravenna, OH | Owned | 64,000 | Manufacturing | |||||||||||||
MANUFACTURED | Cuyahoga Hts., OH | Owned | 427,000 | Manufacturing | Cuyahoga Hts., OH | Owned | 427,000 | Manufacturing | ||||||||||||
PRODUCTS(4) | Cicero, IL | Owned | 450,000 | Manufacturing | Cicero, IL | Owned | 450,000 | Manufacturing | ||||||||||||
Le Roeulx, Belgium | Owned | 120,000 | Manufacturing | Le Roeulx, Belgium | Owned | 120,000 | Manufacturing | |||||||||||||
Wickliffe, OH | Owned | 110,000 | Manufacturing | Wickliffe, OH | Owned | 110,000 | Manufacturing | |||||||||||||
Boaz, AL | Owned | 100,000 | Manufacturing | Brookfield, WI | Leased | 100,000 | Manufacturing | |||||||||||||
Warren, OH | Owned | 195,000 | Manufacturing | Warren, OH | Owned | 195,000 | Manufacturing | |||||||||||||
Canton, OH | Leased | 125,000 | Manufacturing | Canton, OH | Leased | 125,000 | Manufacturing | |||||||||||||
Madison Heights, MI | Leased | 128,000 | Manufacturing | Madison Heights, MI | Leased | 128,000 | Manufacturing | |||||||||||||
Newport, AR | Leased | 200,000 | Manufacturing | Newport, AR | Leased | 200,000 | Manufacturing | |||||||||||||
Cleveland, OH | Leased | 150,000 | Manufacturing | Cleveland, OH | Leased | 150,000 | Manufacturing |
(1) | Supply Technologies has |
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(2) | Includes 20,150 square feet used by Holdings’ and Park-Ohio’s corporate office. | |
(3) | Includes three leased properties with square footage of 91,800, 64,000 and 45,700, respectively, and two owned properties with 82,300 and 20,200 square feet, respectively. | |
(4) | Manufactured Products has |
Item 3. | Legal Proceedings |
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Item 4. |
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Item 4A. | Executive Officers of the Registrant |
Name | Age | Position | ||||
Edward F. Crawford | Chairman of the Board, Chief Executive Officer and Director | |||||
Matthew V. Crawford | President and Chief Operating Officer and Director | |||||
Jeffrey L. Rutherford | Vice President and Chief Financial Officer | |||||
Robert D. Vilsack | Secretary and General Counsel | |||||
Patrick W. Fogarty | Director of Corporate Development |
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Item 5. | Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
2009 | 2008 | 2010 | 2009 | |||||||||||||||||||||||||||||
Quarter | High | Low | High | Low | High | Low | High | Low | ||||||||||||||||||||||||
1st | $ | 6.63 | $ | 1.65 | $ | 25.20 | $ | 13.70 | $ | 9.96 | $ | 5.69 | $ | 6.63 | $ | 1.65 | ||||||||||||||||
2nd | 5.24 | 2.67 | 18.24 | 14.56 | 16.40 | 8.80 | 5.24 | 2.67 | ||||||||||||||||||||||||
3rd | 9.32 | 2.69 | 22.16 | 11.77 | 15.66 | 10.01 | 9.32 | 2.69 | ||||||||||||||||||||||||
4th | 8.69 | 4.01 | 18.49 | 3.76 | 23.70 | 12.77 | 8.69 | 4.01 |
Total Number | ||||||||||||||||
Total | of Shares | |||||||||||||||
Number | Average | Purchased as | Maximum Number of Shares | |||||||||||||
of Shares | Price Paid | Part of Publicly | That May Yet Be Purchased | |||||||||||||
Period | Purchased | Per Share | Announced Plans(1) | Under the Plans or Program | ||||||||||||
October 1 — October 31, 2009 | 30,445(2 | ) | $ | 8.26 | -0- | 340,920 | ||||||||||
November 1 — November 30, 2009 | -0- | -0- | -0- | 340,920 | ||||||||||||
December 1 — December 31, 2009 | -0- | -0- | -0- | 340,920 | ||||||||||||
TOTAL | 30,445 | $ | 8.26 | -0- | 340,920 | |||||||||||
Total Number | ||||||||||||||||
Total | of Shares | |||||||||||||||
Number | Average | Purchased as | Maximum Number of Shares | |||||||||||||
of Shares | Price Paid | Part of Publicly | That May Yet Be Purchased | |||||||||||||
Period | Purchased | Per Share | Announced Plans(1) | Under the Plans or Program | ||||||||||||
October 1 — October 31, 2010 | -0- | $ | -0- | -0- | 340,920 | |||||||||||
November 1 — November 30, 2010 | -0- | -0- | -0- | 340,920 | ||||||||||||
December 1 — December 31, 2010 | 5,000 | 21.10 | 5,000 | 335,920 | ||||||||||||
TOTAL | 5,000 | $ | 21.10 | 5,000 | 335,920 | |||||||||||
(1) | In 2006, the Company announced a share repurchase program whereby the Company may repurchase up to 1.0 million shares of its common stock. During the fourth quarter of | |
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Item 6. | Selected Financial Data |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||||||||||||||||||
2009 | 2008 | 2007 | 2006 | 2005 | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||||||||||||||||||
Selected Statement of Operations Data(a): | ||||||||||||||||||||||||||||||||||||||||
Selected Statement of Operations Data: | ||||||||||||||||||||||||||||||||||||||||
Net sales | $ | 701,047 | $ | 1,068,757 | $ | 1,071,441 | $ | 1,056,246 | $ | 932,900 | $ | 813,522 | $ | 701,047 | $ | 1,068,757 | $ | 1,071,441 | $ | 1,056,246 | ||||||||||||||||||||
Cost of products sold | 597,200 | 919,297 | 912,337 | 908,095 | 796,283 | 679,425 | 597,200 | 919,297 | 912,337 | 908,095 | ||||||||||||||||||||||||||||||
Gross profit | 103,847 | 149,460 | 159,104 | 148,151 | 136,617 | 134,097 | 103,847 | 149,460 | 159,104 | 148,151 | ||||||||||||||||||||||||||||||
Selling, general and administrative expenses | 87,786 | 105,546 | 98,679 | 90,296 | 82,133 | 91,755 | 87,786 | 105,546 | 98,679 | 90,296 | ||||||||||||||||||||||||||||||
Goodwill impairment charge | -0- | 95,763 | -0- | -0- | -0- | -0- | -0- | 95,763 | -0- | -0- | ||||||||||||||||||||||||||||||
Gain on sale of assets held for sale | -0- | -0- | (2,299 | ) | -0- | -0- | -0- | -0- | -0- | (2,299 | ) | -0- | ||||||||||||||||||||||||||||
Restructuring and impairment charges (credits) | 5,206 | 25,331 | -0- | (809 | ) | 943 | 3,539 | 5,206 | 25,331 | -0- | (809 | ) | ||||||||||||||||||||||||||||
Operating income (loss) | 10,855 | (77,180 | ) | 62,724 | 58,664 | 53,541 | 38,803 | 10,855 | (77,180 | ) | 62,724 | 58,664 | ||||||||||||||||||||||||||||
Gain on purchase of 8.375% senior subordinated notes | (6,297 | ) | (6,232 | ) | -0- | -0- | -0- | -0- | (6,297 | ) | (6,232 | ) | -0- | -0- | ||||||||||||||||||||||||||
Interest expense(c) | 23,189 | 27,869 | 31,551 | 31,267 | 27,056 | |||||||||||||||||||||||||||||||||||
Gain on acquisition of business | (2,210 | ) | -0- | -0- | -0- | -0- | ||||||||||||||||||||||||||||||||||
Interest expense | 23,792 | 23,189 | 27,869 | 31,551 | 31,267 | |||||||||||||||||||||||||||||||||||
(Loss) income before income taxes | (6,037 | ) | (98,817 | ) | 31,173 | 27,397 | 26,485 | |||||||||||||||||||||||||||||||||
Income tax (benefit) expense(d) | (828 | ) | 20,986 | 9,976 | 3,218 | (4,323 | ) | |||||||||||||||||||||||||||||||||
Income (loss) before income taxes | 17,221 | (6,037 | ) | (98,817 | ) | 31,173 | 27,397 | |||||||||||||||||||||||||||||||||
Income tax expense (benefit)(b) | 2,034 | (828 | ) | 20,986 | 9,976 | 3,218 | ||||||||||||||||||||||||||||||||||
Net (loss) income | $ | (5,209 | ) | $ | (119,803 | ) | $ | 21,197 | $ | 24,179 | $ | 30,808 | ||||||||||||||||||||||||||||
Net income (loss) | $ | 15,187 | $ | (5,209 | ) | $ | (119,803 | ) | $ | 21,197 | $ | 24,179 | ||||||||||||||||||||||||||||
Amounts per common share: | ||||||||||||||||||||||||||||||||||||||||
Basic | $ | (.47 | ) | $ | (10.88 | ) | $ | 1.91 | $ | 2.20 | $ | 2.82 | $ | 1.34 | $ | (.47 | ) | $ | (10.88 | ) | $ | 1.91 | $ | 2.20 | ||||||||||||||||
Diluted | $ | (.47 | ) | $ | (10.88 | ) | $ | 1.82 | $ | 2.11 | $ | 2.70 | $ | 1.29 | $ | (.47 | ) | $ | (10.88 | ) | $ | 1.82 | $ | 2.11 | ||||||||||||||||
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||||||||||||||||||
2009 | 2008 | 2007 | 2006 | 2005 | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||||||||||||||||||
Other Financial Data: | ||||||||||||||||||||||||||||||||||||||||
Net cash flows provided by operating activities | $ | 43,865 | $ | 8,547 | $ | 31,466 | $ | 6,063 | $ | 34,501 | $ | 67,059 | $ | 43,865 | $ | 8,547 | $ | 31,466 | $ | 6,063 | ||||||||||||||||||||
Net cash flows used by investing activities | (4,772 | ) | (20,398 | ) | (21,991 | ) | (31,407 | ) | (31,376 | ) | (29,851 | ) | (4,772 | ) | (20,398 | ) | (21,991 | ) | (31,407 | ) | ||||||||||||||||||||
Net cash flows (used) provided by financing activities | (33,820 | ) | 15,164 | (16,600 | ) | 28,285 | 8,414 | (24,995 | ) | (33,820 | ) | 15,164 | (16,600 | ) | 28,285 | |||||||||||||||||||||||||
Depreciation and amortization | 18,918 | 20,933 | 20,611 | 20,140 | 17,346 | 17,132 | 18,918 | 20,933 | 20,611 | 20,140 | ||||||||||||||||||||||||||||||
Capital expenditures, net | 5,575 | 17,466 | 21,876 | 20,756 | 20,295 | 3,951 | 5,575 | 17,466 | 21,876 | 20,756 | ||||||||||||||||||||||||||||||
Selected Balance Sheet Data (as of period end): | ||||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 23,098 | $ | 17,825 | $ | 14,512 | $ | 21,637 | $ | 18,696 | $ | 35,311 | $ | 23,098 | $ | 17,825 | $ | 14,512 | $ | 21,637 | ||||||||||||||||||||
Working capital | 229,348 | 252,873 | 270,939 | 268,825 | 208,051 | 219,193 | 222,748 | 252,873 | 270,939 | 268,825 | ||||||||||||||||||||||||||||||
Property, plant and equipment | 76,631 | 90,642 | 105,557 | 101,085 | 110,310 | 68,783 | 76,631 | 90,642 | 105,557 | 101,085 | ||||||||||||||||||||||||||||||
Total assets | 502,268 | 619,220 | 769,189 | 783,751 | 662,854 | 552,532 | 502,268 | 619,220 | 769,189 | 783,751 | ||||||||||||||||||||||||||||||
Total debt | 333,997 | 374,646 | 360,049 | 374,800 | 346,649 | 316,213 | 333,997 | 374,646 | 360,049 | 374,800 | ||||||||||||||||||||||||||||||
Shareholders’ equity | 22,810 | 12,755 | 171,478 | 138,737 | 103,521 | 46,375 | 22,810 | 12,755 | 171,478 | 138,737 |
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(a) |
In each of the years ended December 31, 2010, 2009, 2008, 2007 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||||||||||||||||||
2009 | 2008 | 2007 | 2006 | 2005 | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
Non-cash charges: | ||||||||||||||||||||||||||||||||||||||||
Cost of products sold (inventory write-down) | $ | 1,797 | $ | 5,544 | $ | 2,214 | $ | 800 | $ | 833 | $ | -0- | $ | 1,797 | $ | 5,544 | $ | 2,214 | $ | 800 | ||||||||||||||||||||
Asset impairment | 5,206 | 24,767 | -0- | -0- | 391 | 3,539 | 5,206 | 24,767 | -0- | -0- | ||||||||||||||||||||||||||||||
Restructuring and severance | -0- | 564 | -0- | -0- | 400 | -0- | -0- | 564 | -0- | -0- | ||||||||||||||||||||||||||||||
Pension and postretirement benefits curtailment (credits) | -0- | -0- | -0- | (809 | ) | 152 | -0- | -0- | -0- | -0- | (809 | ) | ||||||||||||||||||||||||||||
Total | $ | 7,003 | $ | 30,875 | $ | 2,214 | $ | (9 | ) | $ | 1,776 | $ | 3,539 | $ | 7,003 | $ | 30,875 | $ | 2,214 | $ | (9 | ) | ||||||||||||||||||
Charges reflected as restructuring and impairment charges (credits) on income statement | $ | 5,206 | $ | 25,331 | $ | -0- | $ | (809 | ) | $ | 943 | $ | 3,539 | $ | 5,206 | $ | 25,331 | $ | -0- | $ | (809 | ) | ||||||||||||||||||
In 2006, |
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Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2010 | 2009 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Supply Technologies | $ | 402.1 | $ | 328.8 | $ | 73.3 | 22 | % | ||||||||
Aluminum Products | 143.7 | 111.4 | 32.3 | 29 | % | |||||||||||
Manufactured Products | 267.7 | 260.8 | 6.9 | 3 | % | |||||||||||
Consolidated Net Sales | $ | 813.5 | $ | 701.0 | $ | 112.5 | 16 | % | ||||||||
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Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2010 | 2009 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Consolidated cost of products sold | $ | 679.4 | $ | 597.2 | $ | 82.2 | 14 | % | ||||||||
Consolidated gross profit | $ | 134.1 | $ | 103.8 | $ | 30.3 | 29 | % | ||||||||
Gross margin | 16.5 | % | 14.8 | % |
Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2010 | 2009 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Consolidated SG&A expenses | $ | 91.8 | $ | 87.8 | $ | 4.0 | 5 | % | ||||||||
SG&A percent | 11.3 | % | 12.5 | % |
Year-Ended | ||||||||||||||
December 31, | Percent | |||||||||||||
2010 | 2009 | Change | Change | |||||||||||
(Dollars in millions) | ||||||||||||||
Interest expense | $ | 23.8 | $ | 23.2 | $ | .6 | 3% | |||||||
Average outstanding borrowings | $ | 322.0 | $ | 363.9 | $ | (41.9 | ) | (11.5)% | ||||||
Average borrowing rate | 7.39 | % | 6.38 | % | 101 | basis points |
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Year Ended | ||||||||
December 31, | ||||||||
2010 | 2009 | |||||||
(Dollars in millions) | ||||||||
Income before income taxes | $ | 17.2 | $ | (6.0 | ) | |||
Income tax expense (benefit) | $ | 2.0 | $ | (.8 | ) | |||
Effective income tax rate | 11.6 | % | 13 | % |
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Year-Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2009 | 2008 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Supply Technologies | $ | 328.8 | $ | 521.3 | $ | (192.5 | ) | (37 | )% | |||||||
Aluminum Products | 111.4 | 156.3 | (44.9 | ) | (29 | )% | ||||||||||
Manufactured Products | 260.8 | 391.2 | (130.4 | ) | (33 | )% | ||||||||||
Consolidated Net Sales | $ | 701.0 | $ | 1,068.8 | $ | (367.8 | ) | (34 | )% | |||||||
Year Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2009 | 2008 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Supply Technologies | $ | 328.8 | $ | 521.3 | $ | (192.5 | ) | (37 | )% | |||||||
Aluminum Products | 111.4 | 156.3 | (44.9 | ) | (29 | )% | ||||||||||
Manufactured Products | 260.8 | 391.2 | (130.4 | ) | (33 | )% | ||||||||||
Consolidated Net Sales | $ | 701.0 | $ | 1,068.8 | $ | (367.8 | ) | (34 | )% | |||||||
Year-Ended | Year Ended | |||||||||||||||||||||||||||||||
December 31, | Percent | December 31, | Percent | |||||||||||||||||||||||||||||
2009 | 2008 | Change | Change | 2009 | 2008 | Change | Change | |||||||||||||||||||||||||
(Dollars in millions) | (Dollars in millions) | |||||||||||||||||||||||||||||||
Consolidated cost of products sold | $ | 597.2 | $ | 919.3 | $ | (322.1 | ) | (35 | )% | $ | 597.2 | $ | 919.3 | $ | (322.1 | ) | (35 | )% | ||||||||||||||
Consolidated gross profit | $ | 103.8 | $ | 149.5 | $ | (45.7 | ) | (31 | )% | $ | 103.8 | $ | 149.5 | $ | (45.7 | ) | (31 | )% | ||||||||||||||
Gross margin | 14.8 | % | 14.0 | % | 14.8 | % | 14.0 | % |
Year-Ended | Year Ended | |||||||||||||||||||||||||||||||
December 31, | Percent | December 31, | Percent | |||||||||||||||||||||||||||||
2009 | 2008 | Change | Change | 2009 | 2008 | Change | Change | |||||||||||||||||||||||||
(Dollars in millions) | (Dollars in millions) | |||||||||||||||||||||||||||||||
Consolidated SG&A expenses | $ | 87.8 | $ | 105.5 | $ | (17.7 | ) | (17 | )% | $ | 87.8 | $ | 105.5 | $ | (17.7 | ) | (17 | )% | ||||||||||||||
SG&A percent | 12.5 | % | 9.9 | % | 12.5 | % | 9.9 | % |
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Year-Ended | Year Ended | |||||||||||||||||||||||||||||
December 31, | Percent | December 31, | Percent | |||||||||||||||||||||||||||
2009 | 2008 | Change | Change | 2009 | 2008 | Change | Change | |||||||||||||||||||||||
(Dollars in millions) | (Dollars in millions) | |||||||||||||||||||||||||||||
Interest expense | $ | 23.2 | $ | 27.9 | $ | (4.7 | ) | (17)% | $ | 23.2 | $ | 27.9 | $ | (4.7 | ) | (17 | )% | |||||||||||||
Average outstanding borrowings | $ | 363.9 | $ | 385.8 | $ | (21.9 | ) | (6)% | $ | 363.9 | $ | 385.8 | $ | (21.9 | ) | (6 | )% | |||||||||||||
Average borrowing rate | 6.38 | % | 7.23 | % | (85 | ) | basis points | 6.38 | % | 7.23 | % | (85 | ) | basis points |
25
Year-Ended | ||||||||
December 31, | ||||||||
2009 | 2008 | |||||||
(Dollars in millions) | ||||||||
Income before income taxes | $ | (6.0 | ) | $ | (98.8 | ) | ||
Income tax (benefit) expense | $ | (.8 | ) | $ | 21.0 | |||
Effective income tax rate | 13 | % | (21 | )% |
Year Ended | ||||||||
December 31, | ||||||||
2009 | 2008 | |||||||
(Dollars in millions) | ||||||||
(Loss) income before income taxes | $ | (6.0 | ) | $ | (98.8 | ) | ||
Income taxes | $ | (.8 | ) | $ | 21.0 | |||
Effective income tax rate | 13 | % | (21 | )% |
23
Year-Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2008 | 2007 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Supply Technologies | $ | 521.3 | $ | 531.4 | $ | (10.1 | ) | (2 | )% | |||||||
Aluminum Products | 156.3 | 169.1 | (12.8 | ) | (8 | )% | ||||||||||
Manufactured Products | 391.2 | 370.9 | 20.3 | 5 | % | |||||||||||
Consolidated Net Sales | $ | 1,068.8 | $ | 1,071.4 | $ | (2.6 | ) | 0 | % | |||||||
Year-Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2008 | 2007 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Consolidated cost of products sold | $ | 919.3 | $ | 912.3 | $ | 7.0 | 1 | % | ||||||||
Consolidated gross profit | $ | 149.5 | $ | 159.1 | $ | (9.6 | ) | (6 | )% | |||||||
Gross margin | 14.0 | % | 14.8 | % |
24
Year-Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2008 | 2007 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Consolidated SG&A expenses | $ | 105.5 | $ | 98.7 | $ | 6.8 | 7 | % | ||||||||
SG&A percent | 9.9 | % | 9.2 | % |
Year-Ended | ||||||||||||||||
December 31, | Percent | |||||||||||||||
2008 | 2007 | Change | Change | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Interest expense | $ | 27.9 | $ | 31.6 | $ | (3.7 | ) | (12 | )% | |||||||
Average outstanding borrowings | $ | 385.8 | $ | 383.6 | $ | 2.2 | 1 | % | ||||||||
Average borrowing rate | 7.23 | % | 8.23 | % | 100 | basis points |
25
Year-Ended | ||||||||
December 31, | ||||||||
2008 | 2007 | |||||||
(Dollars in millions) | ||||||||
(Loss) income before income taxes | $ | (98.8 | ) | $ | 31.2 | |||
Income taxes | $ | 21.0 | $ | 10.0 | ||||
Effective income tax rate | (21 | )% | 32 | % |
26
26
27
27
Payments Due or Commitment Expiration Per Period | Payments Due or Commitment Expiration Per Period | |||||||||||||||||||||||||||||||||||||||
Less Than | More than | Less Than | More than | |||||||||||||||||||||||||||||||||||||
(In thousands) | Total | 1 Year | 1-3 Years | 4-5 Years | 5 Years | Total | 1 Year | 1-3 Years | 4-5 Years | 5 Years | ||||||||||||||||||||||||||||||
Long-term debt obligations | $ | 333,792 | $ | 10,689 | $ | 13,936 | $ | 306,358 | $ | 2,809 | $ | 316,213 | $ | 13,756 | $ | 7,590 | $ | 292,580 | $ | 2,287 | ||||||||||||||||||||
Capital lease obligations | 205 | 205 | -0- | -0- | -0- | |||||||||||||||||||||||||||||||||||
Interest obligations(2) | 75,056 | 15,396 | 30,792 | 28,868 | -0- | |||||||||||||||||||||||||||||||||||
Interest obligations(1) | 59,660 | 15,396 | 30,792 | 13,472 | -0- | |||||||||||||||||||||||||||||||||||
Operating lease obligations | 36,815 | 12,477 | 14,955 | 5,785 | 3,598 | 39,699 | 13,109 | 16,232 | 8,180 | 2,178 | ||||||||||||||||||||||||||||||
Purchase obligations | 90,218 | 84,238 | 5,980 | -0- | -0- | 135,098 | 128,826 | 6,265 | 4 | 3 | ||||||||||||||||||||||||||||||
Postretirement obligations(3) | 19,059 | 2,434 | 4,543 | 4,086 | 7,996 | |||||||||||||||||||||||||||||||||||
Postretirement obligations(2) | 18,150 | 2,454 | 4,332 | 3,867 | 7,497 | |||||||||||||||||||||||||||||||||||
Standby letters of credit and bank guarantees | 19,461 | 13,114 | 5,530 | -0- | 817 | 15,574 | 8,118 | 4,341 | -0- | 3,115 | ||||||||||||||||||||||||||||||
Total | $ | 574,606 | $ | 138,553 | $ | 75,736 | $ | 345,097 | $ | 15,220 | $ | 584,394 | $ | 181,659 | $ | 69,552 | $ | 318,103 | $ | 15,080 | ||||||||||||||||||||
(1) | ||
Interest obligations are included on the 8.375% Notes only and assume the notes are paid at maturity. The calculation of interest on debt outstanding under our revolving credit facility and other variable rate debt ($ | ||
Postretirement obligations include projected postretirement benefit payments to participants only through |
28
28
29
29
30
30
31
32
32
33
Item 7A. | Quantitative and Qualitative Disclosures About Market Risk |
Item 8. | Financial Statements and Supplementary Data |
Page | ||||
36 | ||||
37 | ||||
62 | ||||
62 | ||||
3433
3534
3635
December 31, | ||||||||
2009 | 2008 | |||||||
(Dollars in thousands) | ||||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 23,098 | $ | 17,825 | ||||
Accounts receivable, less allowances for doubtful accounts of $8,388 in 2009 and $3,044 in 2008 | 104,643 | 165,779 | ||||||
Inventories | 182,116 | 228,817 | ||||||
Deferred tax assets | 8,104 | 9,446 | ||||||
Unbilled contract revenue | 19,411 | 25,602 | ||||||
Other current assets | 12,700 | 12,818 | ||||||
Total Current Assets | 350,072 | 460,287 | ||||||
Property, plant and equipment: | ||||||||
Land and land improvements | 3,948 | 3,723 | ||||||
Buildings | 46,181 | 42,464 | ||||||
Machinery and equipment | 195,111 | 202,287 | ||||||
245,240 | 248,474 | |||||||
Less accumulated depreciation | 168,609 | 157,832 | ||||||
76,631 | 90,642 | |||||||
Other Assets: | ||||||||
Goodwill | 4,155 | 4,109 | ||||||
Other | 71,410 | 64,182 | ||||||
$ | 502,268 | $ | 619,220 | |||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current Liabilities | ||||||||
Trade accounts payable | $ | 75,083 | $ | 121,995 | ||||
Accrued expenses | 39,150 | 74,351 | ||||||
Current portion of long-term debt | 10,894 | 8,778 | ||||||
Current portion of other postretirement benefits | 2,197 | 2,290 | ||||||
Total Current Liabilities | 127,324 | 207,414 | ||||||
Long-Term Liabilities, less current portion | ||||||||
8.375% senior subordinated notes due 2014 | 183,835 | 198,985 | ||||||
Revolving credit | 134,600 | 164,600 | ||||||
Other long-term debt | 4,668 | 2,283 | ||||||
Deferred tax liability | 7,200 | 9,090 | ||||||
Other postretirement benefits and other long-term liabilities | 21,831 | 24,093 | ||||||
352,134 | 399,051 | |||||||
Shareholders’ Equity | ||||||||
Capital stock, par value $1 per share | ||||||||
Serial preferred stock: | ||||||||
Authorized — 632,470 shares; Issued and outstanding — none | -0- | -0- | ||||||
Common stock: | ||||||||
Authorized — 40,000,000 shares; Issued — 13,273,842 shares in 2009 and 12,237,392 in 2008 | 13,274 | 12,237 | ||||||
Additional paid-in capital | 66,323 | 64,212 | ||||||
Retained (deficit) | (34,230 | ) | (29,021 | ) | ||||
Treasury stock, at cost, 1,473,969 shares in 2009 and 1,443,524 shares in 2008 | (17,443 | ) | (17,192 | ) | ||||
Accumulated other comprehensive (loss) | (5,114 | ) | (17,481 | ) | ||||
22,810 | 12,755 | |||||||
$ | 502,268 | $ | 619,220 | |||||
December 31, | ||||||||
2010 | 2009 | |||||||
(Dollars in thousands) | ||||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 35,311 | $ | 23,098 | ||||
Accounts receivable, less allowances for doubtful accounts of $6,011 in 2010 and $8,388 in 2009 | 126,409 | 104,643 | ||||||
Inventories | 192,542 | 182,116 | ||||||
Deferred tax assets | 10,496 | 8,104 | ||||||
Unbilled contract revenue | 12,751 | 19,411 | ||||||
Other current assets | 12,800 | 12,700 | ||||||
Total Current Assets | 390,309 | 350,072 | ||||||
Property, plant and equipment: | ||||||||
Land and land improvements | 3,678 | 3,948 | ||||||
Buildings | 47,479 | 46,181 | ||||||
Machinery and equipment | 201,920 | 195,111 | ||||||
253,077 | 245,240 | |||||||
Less accumulated depreciation | 184,294 | 168,609 | ||||||
68,783 | 76,631 | |||||||
Other Assets: | ||||||||
Goodwill | 9,100 | 4,155 | ||||||
Other | 84,340 | 71,410 | ||||||
$ | 552,532 | $ | 502,268 | |||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current Liabilities | ||||||||
Trade accounts payable | $ | 95,695 | $ | 75,083 | ||||
Accrued expenses | 59,487 | 39,150 | ||||||
Current portion of long-term debt | 13,756 | 10,894 | ||||||
Current portion of other postretirement benefits | 2,178 | 2,197 | ||||||
Total Current Liabilities | 171,116 | 127,324 | ||||||
Long-Term Liabilities, less current portion | ||||||||
8.375% senior subordinated notes due 2014 | 183,835 | 183,835 | ||||||
Revolving credit | 113,300 | 134,600 | ||||||
Other long-term debt | 5,322 | 4,668 | ||||||
Deferred tax liability | 9,721 | 7,200 | ||||||
Other postretirement benefits and other long-term liabilities | 22,863 | 21,831 | ||||||
335,041 | 352,134 | |||||||
Shareholders’ Equity | ||||||||
Capital stock, par value $1 per share | ||||||||
Serial preferred stock: | ||||||||
Authorized — 632,470 shares; Issued and outstanding — none | -0- | -0- | ||||||
Common stock: | ||||||||
Authorized — 40,000,000 shares; Issued — 13,396,674 shares in 2010 and 13,273,842 in 2009 | 13,397 | 13,274 | ||||||
Additional paid-in capital | 68,085 | 66,323 | ||||||
Retained (deficit) | (19,043 | ) | (34,230 | ) | ||||
Treasury stock, at cost, 1,558,996 shares in 2010 and 1,473,969 shares in 2009 | (18,502 | ) | (17,443 | ) | ||||
Accumulated other comprehensive income (loss) | 2,438 | (5,114 | ) | |||||
46,375 | 22,810 | |||||||
$ | 552,532 | $ | 502,268 | |||||
36
Year Ended December 31, | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
(Dollars in thousands, | ||||||||||||
except per share data) | ||||||||||||
Net sales | $ | 813,522 | $ | 701,047 | $ | 1,068,757 | ||||||
Cost of products sold | 679,425 | 597,200 | 919,297 | |||||||||
Gross profit | 134,097 | 103,847 | 149,460 | |||||||||
Selling, general and administrative expenses | 91,755 | 87,786 | 105,546 | |||||||||
Goodwill impairment charge | -0- | -0- | 95,763 | |||||||||
Restructuring and impairment charges | 3,539 | 5,206 | 25,331 | |||||||||
Operating income (loss) | 38,803 | 10,855 | (77,180 | ) | ||||||||
Gain on purchase of 8.375% senior subordinated notes | -0- | (6,297 | ) | (6,232 | ) | |||||||
Gain on acquisition of business | (2,210 | ) | -0- | -0- | ||||||||
Interest expense | 23,792 | 23,189 | 27,869 | |||||||||
Income (loss) before income taxes | 17,221 | (6,037 | ) | (98,817 | ) | |||||||
Income tax expense (benefit) | 2,034 | (828 | ) | 20,986 | ||||||||
Net income (loss) | $ | 15,187 | $ | (5,209 | ) | $ | (119,803 | ) | ||||
Amounts per common share: | ||||||||||||
Basic | $ | 1.34 | $ | (.47 | ) | $ | (10.88 | ) | ||||
Diluted | $ | 1.29 | $ | (.47 | ) | $ | (10.88 | ) | ||||
37
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(Dollars in thousands, | ||||||||||||
except per share data) | ||||||||||||
Net sales | $ | 701,047 | $ | 1,068,757 | $ | 1,071,441 | ||||||
Cost of products sold | 597,200 | 919,297 | 912,337 | |||||||||
Gross profit | 103,847 | 149,460 | 159,104 | |||||||||
Selling, general and administrative expenses | 87,786 | 105,546 | 98,679 | |||||||||
Goodwill impairment charge | -0- | 95,763 | -0- | |||||||||
Gain on sale of assets held for sale | -0- | -0- | (2,299 | ) | ||||||||
Restructuring and impairment charges | 5,206 | 25,331 | -0- | |||||||||
Operating income (loss) | 10,855 | (77,180 | ) | 62,724 | ||||||||
Gain on purchase of 8.375% senior subordinated notes | (6,297 | ) | (6,232 | ) | -0- | |||||||
Interest expense | 23,189 | 27,869 | 31,551 | |||||||||
(Loss) income before income taxes | (6,037 | ) | (98,817 | ) | 31,173 | |||||||
Income tax (benefit) expense | (828 | ) | 20,986 | 9,976 | ||||||||
Net (loss) income | $ | (5,209 | ) | $ | (119,803 | ) | $ | 21,197 | ||||
Amounts per common share: | ||||||||||||
Basic | $ | (.47 | ) | $ | (10.88 | ) | $ | 1.91 | ||||
Diluted | $ | (.47 | ) | $ | (10.88 | ) | $ | 1.82 | ||||
Accumulated | ||||||||||||||||||||||||
Additional | Retained | Other | ||||||||||||||||||||||
Common | Paid-In | Earnings | Treasury | Comprehensive | ||||||||||||||||||||
Stock | Capital | (Deficit) | Stock | Income (Loss) | Total | |||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||
Balance at January 1, 2008 | $ | 12,233 | $ | 61,956 | $ | 90,782 | $ | (11,255 | ) | $ | 17,762 | $ | 171,478 | |||||||||||
Comprehensive (loss): | ||||||||||||||||||||||||
Net loss | (119,803 | ) | (119,803 | ) | ||||||||||||||||||||
Foreign currency translation adjustment | (8,730 | ) | (8,730 | ) | ||||||||||||||||||||
Unrealized loss on marketable securities, net of income tax of $-0- | (90 | ) | (90 | ) | ||||||||||||||||||||
Pension and postretirement benefit adjustments, net of income tax of $13,460 | (26,423 | ) | (26,423 | ) | ||||||||||||||||||||
Comprehensive (loss) | (155,046 | ) | ||||||||||||||||||||||
Restricted stock award | 23 | (23 | ) | -0- | ||||||||||||||||||||
Restricted stock exchange for restricted share units | (62 | ) | 62 | -0- | ||||||||||||||||||||
Amortization of restricted stock | 1,677 | 1,677 | ||||||||||||||||||||||
Purchase of treasury stock (614,863 shares) | (5,937 | ) | (5,937 | ) | ||||||||||||||||||||
Exercise of stock options (43,003 shares) | 43 | 104 | 147 | |||||||||||||||||||||
Share-based compensation | 436 | 436 | ||||||||||||||||||||||
Balance at December 31, 2008 | 12,237 | 64,212 | (29,021 | ) | (17,192 | ) | (17,481 | ) | 12,755 | |||||||||||||||
Comprehensive (loss): | ||||||||||||||||||||||||
Net loss | (5,209 | ) | (5,209 | ) | ||||||||||||||||||||
Foreign currency translation adjustment | 2,968 | 2,968 | ||||||||||||||||||||||
Unrealized loss on marketable securities, net of income tax of $182 | 413 | 413 | ||||||||||||||||||||||
Pension and postretirement benefit adjustments, net of income tax of $1,179 | 8,986 | 8,986 | ||||||||||||||||||||||
Comprehensive income | 7,158 | |||||||||||||||||||||||
Restricted stock award, net of forfeiture | 627 | (627 | ) | -0- | ||||||||||||||||||||
Amortization of restricted stock | 1,969 | 1,969 | ||||||||||||||||||||||
Purchase of treasury stock (30,445 shares) | (251 | ) | (251 | ) | ||||||||||||||||||||
Exercise of stock options (410,000 shares) | 410 | 373 | 783 | |||||||||||||||||||||
Share-based compensation | 396 | 396 | ||||||||||||||||||||||
Balance at December 31, 2009 | 13,274 | 66,323 | (34,230 | ) | (17,443 | ) | (5,114 | ) | 22,810 | |||||||||||||||
Comprehensive income (loss): | ||||||||||||||||||||||||
Net income | 15,187 | 15,187 | ||||||||||||||||||||||
Foreign currency translation adjustment | (711 | ) | (711 | ) | ||||||||||||||||||||
Pension and postretirement benefit adjustments, net of income tax of $1,143 | 8,263 | 8,263 | ||||||||||||||||||||||
Comprehensive income | 22,739 | |||||||||||||||||||||||
Amortization of restricted stock | 1,463 | 1,463 | ||||||||||||||||||||||
Restricted share units exchange for restricted stock | 13 | (13 | ) | -0- | ||||||||||||||||||||
Restricted stock awards | 101 | (101 | ) | -0- | ||||||||||||||||||||
Restricted stock cancelled | (14 | ) | 14 | -0- | ||||||||||||||||||||
Purchase of treasury stock (85,027 shares) | (1,059 | ) | (1,059 | ) | ||||||||||||||||||||
Exercise of stock options (23,166 shares) | 23 | 127 | 150 | |||||||||||||||||||||
Share-based compensation | 272 | 272 | ||||||||||||||||||||||
Balance at December 31, 2010 | $ | 13,397 | $ | 68,085 | $ | (19,043 | ) | $ | (18,502 | ) | $ | 2,438 | $ | 46,375 | ||||||||||
38
Accumulated | ||||||||||||||||||||||||
Additional | Retained | Other | ||||||||||||||||||||||
Common | Paid-In | Earnings | Treasury | Comprehensive | ||||||||||||||||||||
Stock | Capital | (Deficit) | Stock | Income (Loss) | Total | |||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||
Balance at January 1, 2007 | $ | 12,110 | $ | 59,676 | $ | 70,193 | $ | (9,066 | ) | $ | 5,824 | $ | 138,737 | |||||||||||
Adjustment relating to adoption of FIN 48 | (608 | ) | (608 | ) | ||||||||||||||||||||
Comprehensive income (loss): | ||||||||||||||||||||||||
Net income | 21,197 | 21,197 | ||||||||||||||||||||||
Foreign currency translation adjustment | 7,328 | 7,328 | ||||||||||||||||||||||
Unrealized loss on marketable securities, net of income tax of $182 | (323 | ) | (323 | ) | ||||||||||||||||||||
Pension and postretirement benefit adjustments, net of income tax of $2,834 | 4,933 | 4,933 | ||||||||||||||||||||||
Comprehensive income | 33,135 | |||||||||||||||||||||||
Restricted stock award | 17 | (17 | ) | -0- | ||||||||||||||||||||
Amortization of restricted stock | 1,651 | 1,651 | ||||||||||||||||||||||
Purchase of treasury stock (92,253 shares) | (2,189 | ) | (2,189 | ) | ||||||||||||||||||||
Exercise of stock options (106,084 shares) | 106 | 234 | 340 | |||||||||||||||||||||
Share-based compensation | 412 | 412 | ||||||||||||||||||||||
Balance at December 31, 2007 | 12,233 | 61,956 | 90,782 | (11,255 | ) | 17,762 | 171,478 | |||||||||||||||||
Comprehensive (loss): | ||||||||||||||||||||||||
Net loss | (119,803 | ) | (119,803 | ) | ||||||||||||||||||||
Foreign currency translation adjustment | (8,730 | ) | (8,730 | ) | ||||||||||||||||||||
Unrealized loss on marketable securities, net of income tax of $-0- | (90 | ) | (90 | ) | ||||||||||||||||||||
Pension and postretirement benefit adjustments, net of income tax of $13,460 | (26,423 | ) | (26,423 | ) | ||||||||||||||||||||
Comprehensive (loss) | (155,046 | ) | ||||||||||||||||||||||
Restricted stock award | 23 | (23 | ) | -0- | ||||||||||||||||||||
Restricted stock exchange for restricted share units | (62 | ) | 62 | -0- | ||||||||||||||||||||
Amortization of restricted stock | 1,677 | 1,677 | ||||||||||||||||||||||
Purchase of treasury stock (614,863 shares) | (5,937 | ) | (5,937 | ) | ||||||||||||||||||||
Exercise of stock options (43,003 shares) | 43 | 104 | 147 | |||||||||||||||||||||
Share-based compensation | 436 | 436 | ||||||||||||||||||||||
Balance at December 31, 2008 | 12,237 | 64,212 | (29,021 | ) | (17,192 | ) | (17,481 | ) | 12,755 | |||||||||||||||
Comprehensive income (loss): | ||||||||||||||||||||||||
Net loss | (5,209 | ) | (5,209 | ) | ||||||||||||||||||||
Foreign currency translation adjustment | 2,968 | 2,968 | ||||||||||||||||||||||
Unrealized loss on marketable securities, net of income tax of $182 | 413 | 413 | ||||||||||||||||||||||
Pension and postretirement benefit adjustments, net of income tax of $1,179 | 8,986 | 8,986 | ||||||||||||||||||||||
Comprehensive income (loss) | 7,158 | |||||||||||||||||||||||
Restricted stock award, net of forfeiture | 627 | (627 | ) | -0- | ||||||||||||||||||||
Amortization of restricted stock | 1,969 | 1,969 | ||||||||||||||||||||||
Purchase of treasury stock (30,445 shares) | (251 | ) | (251 | ) | ||||||||||||||||||||
Exercise of stock options (410,000 shares) | 410 | 373 | 783 | |||||||||||||||||||||
Share-based compensation | 396 | 396 | ||||||||||||||||||||||
Balance at December 31, 2009 | $ | 13,274 | $ | 66,323 | $ | (34,230 | ) | $ | (17,443 | ) | $ | (5,114 | ) | $ | 22,810 | |||||||||
Year Ended December 31, | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
(Dollars in thousands) | ||||||||||||
OPERATING ACTIVITIES | ||||||||||||
Net income (loss) | $ | 15,187 | $ | (5,209 | ) | $ | (119,803 | ) | ||||
Adjustments to reconcile net income (loss) to net cash provided by operations: | ||||||||||||
Depreciation and amortization | 17,132 | 18,918 | 20,933 | |||||||||
Restructuring and impairment charges | 3,539 | 5,206 | 121,094 | |||||||||
Gain on purchase of 8.375% senior subordinated notes | -0- | (6,297 | ) | (6,232 | ) | |||||||
Gain on acquisition of business | (2,210 | ) | -0- | -0- | ||||||||
Deferred income taxes | (1,126 | ) | (1,842 | ) | -0- | |||||||
Stock based compensation expense | 1,735 | 2,365 | 2,113 | |||||||||
Changes in operating assets and liabilities excluding acquisitions of businesses: | ||||||||||||
Accounts receivable | (7,624 | ) | 61,136 | 6,578 | ||||||||
Inventories | 10,067 | 46,701 | (12,547 | ) | ||||||||
Accounts payable and accrued expenses | 28,068 | (82,113 | ) | 7,247 | ||||||||
Other | 2,291 | 5,000 | (10,836 | ) | ||||||||
Net cash provided by operating activities | 67,059 | 43,865 | 8,547 | |||||||||
INVESTING ACTIVITIES | ||||||||||||
Purchases of property, plant and equipment | (3,951 | ) | (5,575 | ) | (17,466 | ) | ||||||
Business acquisitions, net of cash acquired | (25,900 | ) | -0- | (5,322 | ) | |||||||
Purchases of marketable securities | -0- | (62 | ) | (853 | ) | |||||||
Sales of marketable securities | -0- | 865 | 2,983 | |||||||||
Proceeds from the sale of assets held for sale | -0- | -0- | 260 | |||||||||
Net cash used by investing activities | (29,851 | ) | (4,772 | ) | (20,398 | ) | ||||||
FINANCING ACTIVITIES | ||||||||||||
Payments on debt, net | (19,944 | ) | (25,499 | ) | 25,612 | |||||||
Debt issue costs | (4,142 | ) | -0- | -0- | ||||||||
Purchase of 8.375% senior subordinated notes | -0- | (8,853 | ) | (4,658 | ) | |||||||
Issuance of common stock under stock option plan | 150 | 783 | 147 | |||||||||
Purchase of treasury stock | (1,059 | ) | (251 | ) | (5,937 | ) | ||||||
Net cash (used) provided by financing activities | (24,995 | ) | (33,820 | ) | 15,164 | |||||||
Increase in cash and cash equivalents | 12,213 | 5,273 | 3,313 | |||||||||
Cash and cash equivalents at beginning of year | 23,098 | 17,825 | 14,512 | |||||||||
Cash and cash equivalents at end of year | $ | 35,311 | $ | 23,098 | $ | 17,825 | ||||||
Income taxes paid | $ | 1,217 | $ | 3,146 | $ | 6,847 | ||||||
Interest paid | 23,324 | 23,018 | 26,115 |
39
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(Dollars in thousands) | ||||||||||||
OPERATING ACTIVITIES | ||||||||||||
Net (loss) income | $ | (5,209 | ) | $ | (119,803 | ) | $ | 21,197 | ||||
Adjustments to reconcile net (loss) income to net cash provided by operations: | ||||||||||||
Depreciation and amortization | 18,918 | 20,933 | 20,611 | |||||||||
Restructuring and impairment charges | 5,206 | 121,094 | 2,214 | |||||||||
Gain on purchase of 8.375% senior subordinated notes | (6,297 | ) | (6,232 | ) | -0- | |||||||
Deferred income taxes | (1,842 | ) | -0- | 4,342 | ||||||||
Stock based compensation expense | 2,365 | 2,113 | 2,063 | |||||||||
Changes in operating assets and liabilities excluding acquisitions of businesses: | ||||||||||||
Accounts receivable | 61,136 | 6,578 | 9,536 | |||||||||
Inventories | 46,701 | (12,547 | ) | 8,527 | ||||||||
Accounts payable and accrued expenses | (82,113 | ) | 7,247 | (22,246 | ) | |||||||
Other | 5,000 | (10,836 | ) | (14,778 | ) | |||||||
Net cash provided by operating activities | 43,865 | 8,547 | 31,466 | |||||||||
INVESTING ACTIVITIES | ||||||||||||
Purchases of property, plant and equipment | (5,575 | ) | (17,466 | ) | (21,876 | ) | ||||||
Business acquisitions, net of cash acquired | -0- | (5,322 | ) | -0- | ||||||||
Purchases of marketable securities | (62 | ) | (853 | ) | (5,142 | ) | ||||||
Sales of marketable securities | 865 | 2,983 | 662 | |||||||||
Proceeds from the sale of assets held for sale | -0- | 260 | 4,365 | |||||||||
Net cash used by investing activities | (4,772 | ) | (20,398 | ) | (21,991 | ) | ||||||
FINANCING ACTIVITIES | ||||||||||||
(Payments) proceeds on bank arrangements, net | (25,499 | ) | 25,612 | (14,751 | ) | |||||||
Purchase of 8.375% senior subordinated notes | (8,853 | ) | (4,658 | ) | -0- | |||||||
Issuance of common stock under stock option plan | 783 | 147 | 340 | |||||||||
Purchase of treasury stock | (251 | ) | (5,937 | ) | (2,189 | ) | ||||||
Net cash (used) provided by financing activities | (33,820 | ) | 15,164 | (16,600 | ) | |||||||
Increase (decrease) in cash and cash equivalents | 5,273 | 3,313 | (7,125 | ) | ||||||||
Cash and cash equivalents at beginning of year | 17,825 | 14,512 | 21,637 | |||||||||
Cash and cash equivalents at end of year | $ | 23,098 | $ | 17,825 | $ | 14,512 | ||||||
Income taxes paid | $ | 3,146 | $ | 6,847 | $ | 6,170 | ||||||
Interest paid | 23,018 | 26,115 | 30,194 |
40
December 31, | December 31, | |||||||||||||||
2009 | 2008 | 2010 | 2009 | |||||||||||||
Finished goods | $ | 100,309 | $ | 129,939 | $ | 116,202 | $ | 100,309 | ||||||||
Work in process | 26,778 | 29,648 | 24,339 | 26,778 | ||||||||||||
Raw materials and supplies | 55,029 | 69,230 | 52,001 | 55,029 | ||||||||||||
$ | 182,116 | $ | 228,817 | $ | 192,542 | $ | 182,116 | |||||||||
4140
42
41
43
4442
NOTE B — | Segments |
4543
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2009 | 2008 | 2007 | 2010 | 2009 | 2008 | |||||||||||||||||||
Net sales: | ||||||||||||||||||||||||
Supply Technologies | $ | 328,805 | $ | 521,270 | $ | 531,417 | $ | 402,169 | $ | 328,805 | $ | 521,270 | ||||||||||||
Aluminum Products | 111,388 | 156,269 | 169,118 | 143,672 | 111,388 | 156,269 | ||||||||||||||||||
Manufactured Products | 260,854 | 391,218 | 370,906 | 267,681 | 260,854 | 391,218 | ||||||||||||||||||
$ | 701,047 | $ | 1,068,757 | $ | 1,071,441 | $ | 813,522 | $ | 701,047 | $ | 1,068,757 | |||||||||||||
Income before income taxes: | ||||||||||||||||||||||||
Supply Technologies | $ | 6,325 | $ | (74,884 | ) | $ | 27,175 | $ | 22,216 | $ | 8,531 | $ | (66,419 | ) | ||||||||||
Aluminum Products | (5,155 | ) | (36,042 | ) | 3,020 | 6,582 | (5,155 | ) | (23,467 | ) | ||||||||||||||
Manufactured Products | 23,472 | 50,534 | 45,798 | 28,739 | 26,472 | 54,825 | ||||||||||||||||||
24,642 | (60,392 | ) | 75,993 | 57,537 | 29,848 | (35,061 | ) | |||||||||||||||||
Corporate costs | (7,490 | ) | (10,556 | ) | (13,269 | ) | (15,195 | ) | (13,787 | ) | (16,788 | ) | ||||||||||||
Gain on purchase of 8.375% senior subordinated notes | -0- | 6,297 | 6,232 | |||||||||||||||||||||
Gain on acquisition of business | 2,210 | -0- | -0- | |||||||||||||||||||||
Asset impairment charge | (3,539 | ) | (5,206 | ) | (25,331 | ) | ||||||||||||||||||
Interest expense | (23,189 | ) | (27,869 | ) | (31,551 | ) | (23,792 | ) | (23,189 | ) | (27,869 | ) | ||||||||||||
$ | (6,037 | ) | $ | (98,817 | ) | $ | 31,173 | $ | 17,221 | $ | (6,037 | ) | $ | (98,817 | ) | |||||||||
Identifiable assets: | ||||||||||||||||||||||||
Supply Technologies | $ | 207,729 | $ | 256,161 | $ | 354,165 | $ | 217,915 | $ | 207,729 | $ | 256,161 | ||||||||||||
Aluminum Products | 76,443 | 87,215 | 98,524 | 66,219 | 76,443 | 87,215 | ||||||||||||||||||
Manufactured Products | 178,715 | 242,057 | 231,459 | 188,017 | 178,715 | 242,057 | ||||||||||||||||||
General corporate | 39,381 | 33,787 | 85,041 | 80,381 | 39,381 | 33,787 | ||||||||||||||||||
$ | 502,268 | $ | 619,220 | $ | 769,189 | $ | 552,532 | $ | 502,268 | $ | 619,220 | |||||||||||||
Depreciation and amortization expense: | ||||||||||||||||||||||||
Supply Technologies | $ | 4,812 | $ | 5,153 | $ | 4,832 | $ | 5,272 | $ | 4,812 | $ | 5,153 | ||||||||||||
Aluminum Products | 7,556 | 8,564 | 8,563 | 6,488 | 7,556 | 8,564 | ||||||||||||||||||
Manufactured Products | 6,022 | 6,586 | 6,723 | 5,001 | 6,022 | 6,586 | ||||||||||||||||||
General corporate | 528 | 630 | 493 | 371 | 528 | 630 | ||||||||||||||||||
$ | 18,918 | $ | 20,933 | $ | 20,611 | $ | 17,132 | $ | 18,918 | $ | 20,933 | |||||||||||||
Capital expenditures: | ||||||||||||||||||||||||
Supply Technologies | $ | 2,380 | $ | 931 | $ | 7,751 | $ | 1,613 | $ | 2,380 | $ | 931 | ||||||||||||
Aluminum Products | 1,385 | 7,750 | 4,775 | 156 | 1,385 | 7,750 | ||||||||||||||||||
Manufactured Products | 2,006 | 8,101 | 6,534 | 2,138 | 2,006 | 8,101 | ||||||||||||||||||
General corporate | (196 | ) | 684 | 2,816 | 44 | (196 | ) | 684 | ||||||||||||||||
$ | 5,575 | $ | 17,466 | $ | 21,876 | $ | 3,951 | $ | 5,575 | $ | 17,466 | |||||||||||||
4644
Year Ended | Year Ended | |||||||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||||||
2009 | 2008 | 2007 | 2010 | 2009 | 2008 | |||||||||||||||||||
United States | 73 | % | 68 | % | 70 | % | 73 | % | 73 | % | 68 | % | ||||||||||||
Asia | 9 | % | 11 | % | 9 | % | 10 | % | 9 | % | 11 | % | ||||||||||||
Canada | 6 | % | 6 | % | 5 | % | 6 | % | 6 | % | 6 | % | ||||||||||||
Mexico | 2 | % | 6 | % | 6 | % | 3 | % | 2 | % | 6 | % | ||||||||||||
Europe | 9 | % | 6 | % | 6 | % | 5 | % | 9 | % | 6 | % | ||||||||||||
Other | 1 | % | 3 | % | 4 | % | 3 | % | 1 | % | 3 | % | ||||||||||||
100 | % | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | |||||||||||||
NOTE C — | Acquisitions |
Accounts receivable | $ | 9,059 | ||
Inventories | 16,711 | |||
Prepaid expenses and other current assets | 42 | |||
Property, plant and equipment | 299 | |||
Customer relationships | 990 | |||
Accounts payable | (5,047 | ) | ||
Accrued expenses | (330 | ) | ||
Deferred tax liability | (1,354 | ) | ||
Gain on acquisition | (2,210 | ) | ||
Total purchase price | $ | 18,160 | ||
45
Accounts receivable | $ | 1,918 | ||
Inventories | 1,000 | |||
Property, plant and equipment | 2,800 | |||
Accounts payable | (2,314 | ) | ||
Accrued expenses | (516 | ) | ||
Goodwill | 4,572 | |||
Total purchase price | $ | 7,460 | ||
Accounts receivable | $ | 3,164 | ||
Inventories | 2,782 | |||
Prepaid expenses and other current assets | 178 | |||
Property, plant and equipment | 447 | |||
Customer relationships | 3,480 | |||
Technological know how | 1,890 | |||
Trade name and other intangible assets | 710 | |||
Accounts payable | (1,202 | ) | ||
Accrued expenses | (2,133 | ) | ||
Goodwill | 584 | |||
Total purchase price | $ | 9,900 | ||
46
Year Ended December 31, | ||||||||
2010 | 2009 | |||||||
Pro forma revenues | $ | 881,271 | $ | 770,603 | ||||
Pro forma net income | $ | 15,072 | $ | (12,744 | ) | |||
Earnings per share: | ||||||||
Basic | $ | 1.33 | $ | 1.16 | ||||
Diluted | $ | 1.28 | $ | 1.16 |
NOTE D — | Goodwill and Other Intangible Assets |
Supply | Manufactured | Supply | Manufactured | |||||||||||||||||||||||||||||
Technologies | Aluminum | Products | Total | Technologies | Aluminum | Products | Total | |||||||||||||||||||||||||
Balance at January 1, 2008 | $ | 80,249 | $ | 16,515 | $ | 4,233 | $ | 100,997 | $ | 80,249 | $ | 16,515 | $ | 4,233 | $ | 100,997 | ||||||||||||||||
Foreign Currency Translation | (1,001 | ) | -0- | (124 | ) | (1,125 | ) | (1,001 | ) | -0- | (124 | ) | (1,125 | ) | ||||||||||||||||||
Impairment Charge | (79,248 | ) | (16,515 | ) | -0- | (95,763 | ) | (79,248 | ) | (16,515 | ) | -0- | (95,763 | ) | ||||||||||||||||||
Balance at December 31, 2008 | -0- | -0- | 4109 | 4,109 | -0- | -0- | 4,109 | 4,109 | ||||||||||||||||||||||||
Foreign Currency Translation | -0- | -0- | 46 | 46 | -0- | -0- | 46 | 46 | ||||||||||||||||||||||||
Balance at December 31, 2009 | $ | -0- | $ | -0- | $ | 4,155 | $ | 4,155 | -0- | -0- | 4,155 | 4,155 | ||||||||||||||||||||
Foreign Currency Translation | -0- | -0- | (211 | ) | (211 | ) | ||||||||||||||||||||||||||
Acquisitions | -0- | 4,572 | 584 | 5,156 | ||||||||||||||||||||||||||||
Balance at December 31, 2010 | $ | -0- | $ | 4,572 | $ | 4,528 | $ | 9,100 | ||||||||||||||||||||||||
47
2009 | 2008 | 2010 | 2009 | |||||||||||||||||||||||||||||||||||||||||||||
Acquisition | Accumulated | Acquisition | Accumulated | Acquisition | Accumulated | Acquisition | Accumulated | |||||||||||||||||||||||||||||||||||||||||
Costs | Amortization | Net | Costs | Amortization | Net | Costs | Amortization | Net | Costs | Amortization | Net | |||||||||||||||||||||||||||||||||||||
Non-contractual customer relationships | $ | 7,200 | $ | 1,800 | $ | 5,400 | $ | 7,200 | $ | 1,200 | $ | 6,000 | $ | 11,670 | $ | 2,422 | $ | 9,248 | $ | 7,200 | $ | 1,800 | $ | 5,400 | ||||||||||||||||||||||||
Other | 820 | 372 | 448 | 820 | 248 | 572 | 3,420 | 495 | 2,925 | 820 | 372 | 448 | ||||||||||||||||||||||||||||||||||||
$ | 8,020 | $ | 2,172 | $ | 5,848 | $ | 8,020 | $ | 1,448 | $ | 6,572 | $ | 15,090 | $ | 2,917 | $ | 12,173 | $ | 8,020 | $ | 2,172 | $ | 5,848 | |||||||||||||||||||||||||
NOTE E — | Other Assets |
December 31, | December 31, | |||||||||||||||
2009 | 2008 | 2010 | 2009 | |||||||||||||
Pension assets | $ | 49,435 | $ | 38,985 | $ | 60,786 | $ | 49,435 | ||||||||
Deferred financing costs, net | 1,345 | 2,951 | 3,695 | 1,345 | ||||||||||||
Tooling | 384 | 139 | 417 | 384 | ||||||||||||
Software development costs | 3,893 | 4,096 | 2,292 | 3,893 | ||||||||||||
Intangible assets subject to amortization | 5,848 | 6,572 | 12,173 | 5,848 | ||||||||||||
Other | 10,505 | 11,439 | 4,977 | 10,505 | ||||||||||||
Totals | $ | 71,410 | $ | 64,182 | $ | 84,340 | $ | 71,410 | ||||||||
NOTE F — | Accrued Expenses |
December 31, | December 31, | |||||||||||||||
2009 | 2008 | 2010 | 2009 | |||||||||||||
Accrued salaries, wages and benefits | $ | 8,978 | $ | 13,173 | $ | 13,832 | $ | 8,978 | ||||||||
Advance billings | 14,189 | 28,412 | 23,218 | 14,189 | ||||||||||||
Warranty accrual | 2,760 | 5,402 | 4,046 | 2,760 | ||||||||||||
Interest payable | 2,191 | 2,837 | 2,504 | 2,191 | ||||||||||||
Taxes | 1,788 | 6,386 | ||||||||||||||
Taxes, income and other | 3,252 | 1,788 | ||||||||||||||
Other | 9,244 | 18,141 | 12,635 | 9,244 | ||||||||||||
Totals | $ | 39,150 | $ | 74,351 | $ | 59,487 | $ | 39,150 | ||||||||
48
2009 | 2008 | 2007 | 2010 | 2009 | 2008 | |||||||||||||||||||
Balance at beginning of year | $ | 5,402 | $ | 5,799 | $ | 3,557 | $ | 2,760 | $ | 5,402 | $ | 5,799 | ||||||||||||
Claims paid during the year | (3,367 | ) | (3,944 | ) | (2,402 | ) | (1,260 | ) | (3,367 | ) | (3,944 | ) | ||||||||||||
Warranty expense | 704 | 4,202 | 4,526 | 2,294 | 704 | 4,202 | ||||||||||||||||||
Other | 21 | (655 | ) | 118 | 252 | 21 | (655 | ) | ||||||||||||||||
Balance at end of year | $ | 2,760 | $ | 5,402 | $ | 5,799 | $ | 4,046 | $ | 2,760 | $ | 5,402 | ||||||||||||
NOTE G — | Financing Arrangements |
December 31, | December 31, | |||||||||||||||
2009 | 2008 | 2010 | 2009 | |||||||||||||
8.375% senior subordinated notes due 2014 | $ | 183,835 | $ | 198,985 | $ | 183,835 | $ | 183,835 | ||||||||
Revolving credit facility maturing on June 30, 2013 | 141,200 | 164,600 | ||||||||||||||
Revolving credit | 90,200 | 101,200 | ||||||||||||||
Term Loan A | 25,900 | 28,000 | ||||||||||||||
Term Loan B | 8,400 | 12,000 | ||||||||||||||
Other | 8,962 | 11,061 | 7,878 | 8,962 | ||||||||||||
333,997 | 374,646 | 316,213 | 333,997 | |||||||||||||
Less current maturities | 10,894 | 8,778 | 13,756 | 10,894 | ||||||||||||
Total | $ | 323,103 | $ | 365,868 | $ | 302,457 | $ | 323,103 | ||||||||
49
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
Current expense (benefit): | ||||||||||||
Federal | $ | (147 | ) | $ | 229 | $ | (9 | ) | ||||
State | 179 | 1,518 | 299 | |||||||||
Foreign | 982 | 6,156 | 5,344 | |||||||||
1,014 | 7,903 | 5,634 | ||||||||||
Deferred: | ||||||||||||
Federal | (1,231 | ) | 12,421 | 3,639 | ||||||||
State | (39 | ) | 923 | 198 | ||||||||
Foreign | (572 | ) | (261 | ) | 505 | |||||||
(1,842 | ) | 13,083 | 4,342 | |||||||||
Income tax (benefit) expense | $ | (828 | ) | $ | 20,986 | $ | 9,976 | |||||
Year Ended December 31 | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
United States | $ | 6,723 | $ | (10,160 | ) | $ | (113,699 | ) | ||||
Outside the United States | 10,498 | 4,123 | 14,882 | |||||||||
$ | 17,221 | $ | (6,037 | ) | $ | (98,817 | ) | |||||
50
Year Ended December 31, | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
Current expense (benefit): | ||||||||||||
Federal | $ | 61 | $ | (147 | ) | $ | 229 | |||||
State | 573 | 179 | 1,518 | |||||||||
Foreign | 2,526 | 982 | 6,156 | |||||||||
3,160 | 1,014 | 7,903 | ||||||||||
Deferred: | ||||||||||||
Federal | (2,014 | ) | (1,231 | ) | 12,421 | |||||||
State | 689 | (39 | ) | 923 | ||||||||
Foreign | 199 | (572 | ) | (261 | ) | |||||||
(1,126 | ) | (1,842 | ) | 13,083 | ||||||||
Income tax expense (benefit) | $ | 2,034 | $ | (828 | ) | $ | 20,986 | |||||
Rate Reconciliation | 2009 | 2008 | 2007 | 2010 | 2009 | 2008 | ||||||||||||||||||
Tax at statutory rate | $ | (2,113 | ) | $ | (34,586 | ) | $ | 10,911 | $ | 6,027 | $ | (2,113 | ) | $ | (34,586 | ) | ||||||||
Effect of state income taxes, net | (161 | ) | (1,834 | ) | 266 | 1,048 | (161 | ) | (1,834 | ) | ||||||||||||||
Effect of foreign operations | 1,247 | 293 | (1,082 | ) | 1,472 | 1,247 | 293 | |||||||||||||||||
Goodwill | -0- | 23,241 | -0- | -0- | -0- | 23,241 | ||||||||||||||||||
Valuation allowance | (1,815 | ) | 33,625 | 238 | ||||||||||||||||||||
Valuation allowance, federal and foreign | (6,475 | ) | (1,815 | ) | 33,625 | |||||||||||||||||||
Equity compensation | 148 | 18 | 51 | (59 | ) | 148 | 18 | |||||||||||||||||
Tax credits | (192 | ) | (240 | ) | (207 | ) | (72 | ) | (192 | ) | (240 | ) | ||||||||||||
Prior year adjustments | 141 | (304 | ) | 504 | 365 | 141 | (304 | ) | ||||||||||||||||
Non-deductable items | 735 | 802 | 572 | 480 | 735 | 802 | ||||||||||||||||||
Gain on asset purchase | (772 | ) | �� | -0- | -0- | |||||||||||||||||||
Other, net | 1,182 | (29 | ) | (1,277 | ) | 20 | 1,182 | (29 | ) | |||||||||||||||
Total | $ | (828 | ) | $ | 20,986 | $ | 9,976 | $ | 2,034 | $ | (828 | ) | $ | 20,986 | ||||||||||
51
December 31, | December 31, | |||||||||||||||
2009 | 2008 | 2010 | 2009 | |||||||||||||
Deferred tax assets: | ||||||||||||||||
Postretirement benefit obligation | $ | 7,060 | $ | 7,579 | $ | 7,003 | $ | 7,060 | ||||||||
Inventory | 10,342 | 12,126 | 12,363 | 10,342 | ||||||||||||
Net operating loss and credit carryforwards | 22,478 | 22,133 | 16,184 | 22,478 | ||||||||||||
Goodwill | 4,381 | 5,465 | 3,177 | 4,381 | ||||||||||||
Other | 8,348 | 10,832 | 11,138 | 8,348 | ||||||||||||
Total deferred tax assets | 52,609 | 58,135 | 49,865 | 52,609 | ||||||||||||
Deferred tax liabilities: | ||||||||||||||||
Depreciation and amortization | 692 | 5,824 | 1,090 | 692 | ||||||||||||
Pension | 18,010 | 14,389 | 21,423 | 18,010 | ||||||||||||
Intangible assets and other | 2,335 | 2,645 | 4,191 | 2,335 | ||||||||||||
Total deferred tax liabilities | 21,037 | 22,858 | 26,704 | 21,037 | ||||||||||||
Net deferred tax assets prior to valuation allowances | 31,572 | 35,277 | 23,161 | 31,572 | ||||||||||||
Valuation allowances | (30,668 | ) | (34,921 | ) | (22,386 | ) | (30,668 | ) | ||||||||
Net deferred tax asset | $ | 904 | $ | 356 | $ | 775 | $ | 904 | ||||||||
51
52
2009 | 2008 | 2007 | 2010 | 2009 | 2008 | |||||||||||||||||||
Unrecognized Tax Benefit — January 1, | $ | 5,806 | $ | 5,255 | $ | 4,691 | $ | 5,718 | $ | 5,806 | $ | 5,255 | ||||||||||||
Gross Increases — Tax Positions in Prior Period | 101 | -0- | 72 | 283 | 101 | -0- | ||||||||||||||||||
Gross Decreases — Tax Positions in Prior Period | (55 | ) | (39 | ) | (133 | ) | (4 | ) | (55 | ) | (39 | ) | ||||||||||||
Gross Increases — Tax Positions in Current Period | 97 | 590 | 625 | 341 | 97 | 590 | ||||||||||||||||||
Settlements | -0- | -0- | -0- | (18 | ) | -0- | -0- | |||||||||||||||||
Lapse of Statute of Limitations | (231 | ) | -0- | -0- | (178 | ) | (231 | ) | -0- | |||||||||||||||
Unrecognized Tax Benefit — December 31, | $ | 5,718 | $ | 5,806 | $ | 5,255 | $ | 6,142 | $ | 5,718 | $ | 5,806 | ||||||||||||
NOTE I — | Stock Plan |
52
2008 | 2007 | |||||||
Weighted average fair value per option | $ | 7.48 | $ | 12.92 | ||||
Risk-free interest rate | 3.33 | % | 4.62 | % | ||||
Dividend yield | 0 | % | 0 | % | ||||
Expected stock volatility | 53 | % | 57 | % | ||||
Expected life — years | 6.0 | 6.0 |
�� | ||||
Weighted average fair value per option | $ | 7.48 | ||
Risk-free interest rate | 3.33 | % | ||
Dividend yield | 0 | % | ||
Expected stock volatility | 53 | % | ||
Expected life — years | 6.0 |
53
2010 | ||||||||||||||||
Weighted | ||||||||||||||||
Weighted | Average | |||||||||||||||
Average | Remaining | Aggregate | ||||||||||||||
Number | Exercise | Contractual | Intrinsic | |||||||||||||
of Shares | Price | Term | Value | |||||||||||||
Outstanding — beginning of year | 491,050 | $ | 6.26 | |||||||||||||
Granted | -0- | -0- | ||||||||||||||
Exercised | (23,166 | ) | 6.47 | |||||||||||||
Canceled or Expired | (9,250 | ) | 21.42 | |||||||||||||
Outstanding — end of year | 458,634 | $ | 6.17 | 3.3 years | $ | 6,839 | ||||||||||
Options Exercisable | 429,470 | 7.99 | 3.0 years | 5,628 |
5354
2009 | ||||||||||||||||
Weighted | ||||||||||||||||
Weighted | Average | |||||||||||||||
Average | Remaining | Aggregate | ||||||||||||||
Number | Exercise | Contractual | Intrinsic | |||||||||||||
of Shares | Price | Term | Value | |||||||||||||
Outstanding — beginning of year | 901,050 | $ | 4.28 | |||||||||||||
Granted | -0- | -0- | ||||||||||||||
Exercised | (410,000 | ) | 1.91 | |||||||||||||
Canceled or Expired | -0- | -0- | ||||||||||||||
Outstanding — end of year | 491,050 | $ | 6.26 | 4.0 years | $ | 931 | ||||||||||
Options Exercisable | 421,050 | 7.31 | 3.6 years | 877 |
2009 | 2010 | |||||||||||||||
Weighted | Weighted | |||||||||||||||
Average | Average | |||||||||||||||
Number of | Grant Date | Number of | Grant Date | |||||||||||||
Shares | Fair Value | Shares | Fair Value | |||||||||||||
Outstanding — beginning of year | 174,501 | $ | 14.93 | 695,410 | $ | 4.58 | ||||||||||
Granted | 644,700 | 3.50 | 101,000 | 12.12 | ||||||||||||
Vested | (105,541 | ) | 13.39 | (362,186 | ) | 4.74 | ||||||||||
Canceled or expired | (18,250 | ) | 3.49 | (14,834 | ) | 6.15 | ||||||||||
Outstanding — end of year | 695,410 | $ | 4.58 | 419,390 | $ | 6.26 | ||||||||||
54
NOTE J — | Legal Proceedings |
NOTE K — | Pensions and Postretirement Benefits |
55
Postretirement | Postretirement | |||||||||||||||||||||||||||||||
Pension | Benefits | Pension | Benefits | |||||||||||||||||||||||||||||
2009 | 2008 | 2009 | 2008 | 2010 | 2009 | 2010 | 2009 | |||||||||||||||||||||||||
Change in benefit obligation | ||||||||||||||||||||||||||||||||
Benefit obligation at beginning of year | $ | 48,383 | $ | 48,320 | $ | 19,961 | $ | 18,711 | $ | 48,820 | $ | 48,383 | $ | 18,288 | $ | 19,961 | ||||||||||||||||
Service cost | 471 | 439 | 61 | 87 | 295 | 471 | 31 | 61 | ||||||||||||||||||||||||
Interest cost | 2,748 | 2,892 | 1,053 | 1,215 | 2,596 | 2,748 | 959 | 1,053 | ||||||||||||||||||||||||
Amendments | 10 | -0- | (920 | ) | -0- | -0- | 10 | -0- | (920 | ) | ||||||||||||||||||||||
Actuarial losses (gains) | 1,446 | 1,150 | 279 | 2,348 | ||||||||||||||||||||||||||||
Actuarial losses | 2,622 | 1,446 | 1,364 | 279 | ||||||||||||||||||||||||||||
Benefits and expenses paid, net of contributions | (4,238 | ) | (4,418 | ) | (2,146 | ) | (2,400 | ) | (4,661 | ) | (4,238 | ) | (2,210 | ) | (2,146 | ) | ||||||||||||||||
Benefit obligation at end of year | $ | 48,820 | $ | 48,383 | $ | 18,288 | $ | 19,961 | $ | 49,672 | $ | 48,820 | $ | 18,432 | $ | 18,288 | ||||||||||||||||
Change in plan assets | ||||||||||||||||||||||||||||||||
Fair value of plan assets at beginning of year | $ | 87,368 | $ | 118,878 | $ | -0- | $ | -0- | $ | 98,255 | $ | 87,368 | $ | -0- | $ | -0- | ||||||||||||||||
Actual return on plan assets | 16,725 | (27,092 | ) | -0- | -0- | 18,364 | 16,725 | -0- | -0- | |||||||||||||||||||||||
Company contributions | -0- | -0- | 2,146 | 2,400 | -0- | -0- | 2,210 | 2,146 | ||||||||||||||||||||||||
Cash transfer to fund postretirement benefit payments | (1,600 | ) | -0- | -0- | -0- | (1,500 | ) | (1,600 | ) | -0- | -0- | |||||||||||||||||||||
Benefits and expenses paid, net of contributions | (4,238 | ) | (4,418 | ) | (2,146 | ) | (2,400 | ) | (4,661 | ) | (4,238 | ) | (2,210 | ) | (2,146 | ) | ||||||||||||||||
Fair value of plan assets at end of year | $ | 98,255 | $ | 87,368 | $ | -0- | $ | -0- | $ | 110,458 | $ | 98,255 | $ | -0- | $ | -0- | ||||||||||||||||
Funded (underfunded) status of the plans | $ | 49,435 | $ | 38,985 | $ | (18,288 | ) | $ | (19,961 | ) | $ | 60,786 | $ | 49,435 | $ | (18,432 | ) | $ | (18,288 | ) | ||||||||||||
Postretirement | Postretirement | |||||||||||||||||||||||||||||||
Pension | Benefits | Pension | Benefits | |||||||||||||||||||||||||||||
2009 | 2008 | 2009 | 2008 | 2010 | 2009 | 2010 | 2009 | |||||||||||||||||||||||||
Noncurrent assets | $ | 49,435 | $ | 38,985 | $ | -0- | $ | -0- | $ | 60,786 | $ | 49,435 | $ | -0- | $ | -0- | ||||||||||||||||
Noncurrent liabilities | -0- | -0- | 11,111 | 11,757 | -0- | -0- | 10,196 | 11,111 | ||||||||||||||||||||||||
Current liabilities | -0- | -0- | 2,197 | 2,290 | -0- | -0- | 2,177 | 2,197 | ||||||||||||||||||||||||
Accumulated other comprehensive (income) loss | 15,900 | 25,131 | 4,980 | 5,914 | 7,701 | 15,900 | 6,059 | 4,980 | ||||||||||||||||||||||||
Net amount recognized at the end of the year | $ | 65,335 | $ | 64,116 | $ | 18,288 | $ | 19,961 | $ | 68,487 | $ | 65,335 | $ | 18,432 | $ | 18,288 | ||||||||||||||||
Amounts recognized in accumulated other comprehensive (income) loss | ||||||||||||||||||||||||||||||||
Net actuarial loss/(gain) | $ | 15,819 | $ | 24,972 | $ | 4,980 | $ | 5,914 | $ | 7,641 | $ | 15,819 | $ | 6,059 | $ | 4,980 | ||||||||||||||||
Net prior service cost (credit) | 253 | 372 | -0- | -0- | 192 | 253 | -0- | -0- | ||||||||||||||||||||||||
Net transition obligation (asset) | (172 | ) | (213 | ) | -0- | -0- | (132 | ) | (172 | ) | -0- | -0- | ||||||||||||||||||||
Accumulated other comprehensive (income) loss | $ | 15,900 | $ | 25,131 | $ | 4,980 | $ | 5,914 | $ | 7,701 | $ | 15,900 | $ | 6,059 | $ | 4,980 | ||||||||||||||||
56
Plan Assets | Plan Assets | |||||||||||||||||||||||
Target 2010 | 2009 | 2008 | Target 2011 | 2010 | 2009 | |||||||||||||||||||
Asset Category | ||||||||||||||||||||||||
Equity securities | 60-65 | % | 69.3 | % | 54.0 | % | 45-75 | % | 78.3 | % | 69.3 | % | ||||||||||||
Debt securities | 25-30 | 9.9 | 11.6 | 10-40 | 19.3 | 9.9 | ||||||||||||||||||
Other | 15-20 | 20.8 | 34.4 | 0-20 | 2.4 | 20.8 | ||||||||||||||||||
100 | % | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | |||||||||||||
2010 | 2009 | |||||||||||||||||||||||
Level 2 | Total | Level 2 | Total | Level 2 | Total | |||||||||||||||||||
Collective trust and pooled insurance funds: | ||||||||||||||||||||||||
Common stock | $ | 52,507 | $ | 52,507 | $ | 65,362 | $ | 65,362 | $ | 52,507 | $ | 52,507 | ||||||||||||
Equity Funds | 12,727 | 12,727 | 16,142 | 16,142 | 12,727 | 12,727 | ||||||||||||||||||
Foreign Stock | 2,590 | 2,590 | 5,000 | 5,000 | 2,590 | 2,590 | ||||||||||||||||||
Convertible Securities | 1,063 | 1,063 | 967 | 967 | 1,063 | 1,063 | ||||||||||||||||||
U.S. Government Obligations | 4,900 | 4,900 | 9,840 | 9,840 | 4,900 | 4,900 | ||||||||||||||||||
Fixed income funds | 4,588 | 4,588 | 5,242 | 5,242 | 4,588 | 4,588 | ||||||||||||||||||
Corporate Bonds | 5,295 | 5,295 | -0- | -0- | ||||||||||||||||||||
Cash and Cash Equivalents | 19,779 | 19,779 | 2,381 | 2,381 | 19,779 | 19,779 | ||||||||||||||||||
Other | 100 | 100 | 229 | 229 | 101 | 101 | ||||||||||||||||||
$ | 98,254 | $ | 98,254 | $ | 110,458 | $ | 110,458 | $ | 98,255 | $ | 98,255 | |||||||||||||
Weighted-Average assumptions as of December 31, | Weighted-Average assumptions as of December 31, | |||||||||||||||||||||||||||||||||||||||||||||||
Pension | Postretirement Benefits | Pension | Postretirement Benefits | |||||||||||||||||||||||||||||||||||||||||||||
2009 | 2008 | 2007 | 2009 | 2008 | 2007 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||||||||||||
Discount rate | 5.50 | % | 6.00 | % | 6.25 | % | 5.50 | % | 6.00 | % | 6.25 | % | 5.00 | % | 5.50 | % | 6.00 | % | 5.00 | % | 5.50 | % | 6.00 | % | ||||||||||||||||||||||||
Expected return on plan assets | 8.25 | % | 8.25 | % | 8.25 | % | N/A | N/A | N/A | 8.25 | % | 8.25 | % | 8.25 | % | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Rate of compensation increase | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
57
Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | |||||||||||||||||||||||||||||||||||||||||||||
2009 | 2008 | 2007 | 2009 | 2008 | 2007 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||||||||||||
Components of net periodic benefit cost | ||||||||||||||||||||||||||||||||||||||||||||||||
Service costs | $ | 471 | $ | 439 | $ | 334 | $ | 61 | $ | 87 | $ | 180 | $ | 295 | $ | 471 | $ | 439 | $ | 31 | $ | 61 | $ | 87 | ||||||||||||||||||||||||
Interest costs | 2,748 | 2,892 | 2,842 | 1,053 | 1,215 | 1,103 | 2,596 | 2,748 | 2,892 | 959 | 1,053 | 1,215 | ||||||||||||||||||||||||||||||||||||
Expected return on plan assets | (7,036 | ) | (9,634 | ) | (9,049 | ) | -0- | -0- | -0- | (7,932 | ) | (7,036 | ) | (9,634 | ) | -0- | -0- | -0- | ||||||||||||||||||||||||||||||
Transition obligation | (40 | ) | (47 | ) | (38 | ) | -0- | -0- | -0- | (40 | ) | (40 | ) | (47 | ) | -0- | -0- | -0- | ||||||||||||||||||||||||||||||
FAS 88 one-time charge | -0- | -0- | 80 | -0- | -0- | -0- | -0- | -0- | -0- | -0- | -0- | -0- | ||||||||||||||||||||||||||||||||||||
Amortization of prior service cost | 129 | 137 | 138 | -0- | (52 | ) | (63 | ) | 61 | 129 | 137 | (96 | ) | -0- | (52 | ) | ||||||||||||||||||||||||||||||||
Recognized net actuarial (gain) loss | 910 | (100 | ) | 13 | 294 | 369 | 227 | 366 | 910 | (100 | ) | 381 | 294 | 369 | ||||||||||||||||||||||||||||||||||
Benefit (income) costs | $ | (2,818 | ) | $ | (6,313 | ) | $ | (5,680 | ) | $ | 1,408 | $ | 1,619 | $ | 1,447 | $ | (4,654 | ) | $ | (2,818 | ) | $ | (6,313 | ) | $ | 1,275 | $ | 1,408 | $ | 1,619 | ||||||||||||||||||
Other changes in plan assets and benefit obligations recognized in other comprehensive (income) loss | ||||||||||||||||||||||||||||||||||||||||||||||||
AOCI at beginning of year | $ | 25,131 | $ | (12,756 | ) | $ | (8,144 | ) | $ | 5,914 | $ | 3,884 | $ | 7,038 | $ | 15,900 | $ | 25,131 | $ | (12,756 | ) | $ | 4,980 | $ | 5,914 | $ | 3,884 | |||||||||||||||||||||
Net (gain)/loss | (8,241 | ) | 37,876 | (4,499 | ) | 280 | 2,347 | (2,990 | ) | (7,811 | ) | (8,241 | ) | 37,876 | 1,364 | 280 | 2,347 | |||||||||||||||||||||||||||||||
Recognition of prior service cost/(credit) | (120 | ) | (137 | ) | (138 | ) | (920 | ) | 52 | 63 | (62 | ) | (120 | ) | (137 | ) | 96 | (920 | ) | 52 | ||||||||||||||||||||||||||||
Recognition of (gain)/loss | (870 | ) | 148 | 25 | (294 | ) | (369 | ) | (227 | ) | (326 | ) | (870 | ) | 148 | (381 | ) | (294 | ) | (369 | ) | |||||||||||||||||||||||||||
Total recognized in other comprehensive (income) loss at end of year | $ | 15,900 | $ | 25,131 | $ | (12,756 | ) | $ | 4,980 | $ | 5,914 | $ | 3,884 | |||||||||||||||||||||||||||||||||||
Total recognized in other comprehensive loss at end of year | $ | 7,701 | $ | 15,900 | $ | 25,131 | $ | 6,059 | $ | 4,980 | $ | 5,914 | ||||||||||||||||||||||||||||||||||||
Postretirement Benefits | Postretirement Benefits | |||||||||||||||||||||||||||||||
Pension | Expected | Net including | Pension | Expected | Net including | |||||||||||||||||||||||||||
Benefits | Gross | Medicare Subsidy | Medicare Subsidy | Benefits | Gross | Medicare Subsidy | Medicare Subsidy | |||||||||||||||||||||||||
2010 | 4,088 | 2,434 | 237 | 2,197 | ||||||||||||||||||||||||||||
2011 | 3,988 | 2,353 | 235 | 2,118 | 4,041 | 2,454 | 223 | 2,231 | ||||||||||||||||||||||||
2012 | 3,901 | 2,190 | 236 | 1,954 | 3,942 | 2,240 | 225 | 2,015 | ||||||||||||||||||||||||
2013 | 3,873 | 2,087 | 229 | 1,858 | 3,860 | 2,092 | 219 | 1,873 | ||||||||||||||||||||||||
2014 | 3,802 | 1,999 | 218 | 1,781 | 3,788 | 1,988 | 209 | 1,779 | ||||||||||||||||||||||||
2015 to 2019 | 18,172 | 7,996 | 916 | 7,080 | ||||||||||||||||||||||||||||
2015 | 3,739 | 1,879 | 197 | 1,682 | ||||||||||||||||||||||||||||
2016 to 2020 | 17,837 | 7,497 | 811 | 6,686 |
58
1-Percentage | 1-Percentage | |||||||
Point | Point | |||||||
Increase | Decrease | |||||||
Effect on total of service and interest cost components in 2009 | $ | 91 | $ | (79 | ) | |||
Effect on postretirement benefit obligation as of December 31, 2009 | $ | 1,309 | $ | (1,170 | ) |
1-Percentage | 1-Percentage | |||||||
Point | Point | |||||||
Increase | Decrease | |||||||
Effect on total of service and interest cost components in 2010 | $ | 68 | $ | (60 | ) | |||
Effect on postretirement benefit obligation as of December 31, 2010 | $ | 1,383 | $ | (1,229 | ) |
NOTE L — | Leases |
59
NOTE M — | Earnings Per Share |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2009 | 2008 | 2007 | 2010 | 2009 | 2008 | |||||||||||||||||||
NUMERATOR | ||||||||||||||||||||||||
Net (loss) income | $ | (5,209 | ) | $ | (119,803 | ) | $ | 21,197 | ||||||||||||||||
Net income (loss) | $ | 15,187 | $ | (5,209 | ) | $ | (119,803 | ) | ||||||||||||||||
DENOMINATOR | ||||||||||||||||||||||||
Denominator for basic earnings per share — weighted average shares | 10,968 | 11,008 | 11,106 | 11,314 | 10,968 | 11,008 | ||||||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||||||
Employee stock options | -0- | -0- | 545 | 493 | -0- | -0- | ||||||||||||||||||
Denominator for diluted earnings per share — weighted average shares and assumed conversions | 10,968 | 11,008 | 11,651 | 11,807 | 10,968 | 11,008 | ||||||||||||||||||
Amounts per common share: | ||||||||||||||||||||||||
Basic | $ | (.47 | ) | $ | (10.88 | ) | $ | 1.91 | $ | 1.34 | $ | (.47 | ) | $ | (10.88 | ) | ||||||||
Diluted | $ | (.47 | ) | $ | (10.88 | ) | $ | 1.82 | $ | 1.29 | $ | (.47 | ) | $ | (10.88 | ) | ||||||||
NOTE N — | Accumulated Comprehensive Loss |
December 31, | December 31, | |||||||||||||||
2009 | 2008 | 2010 | 2009 | |||||||||||||
Foreign currency translation adjustment | $ | 6,950 | $ | 3,982 | $ | 6,239 | $ | 6,950 | ||||||||
Unrealized net losses on marketable securities, net of tax | -0- | (413 | ) | |||||||||||||
Pension and postretirement benefit adjustments, net of tax | (12,064 | ) | (21,050 | ) | (3,801 | ) | (12,064 | ) | ||||||||
Total | $ | (5,114 | ) | $ | (17,481 | ) | $ | 2,438 | $ | (5,114 | ) | |||||
NOTE O — | Restructuring and Unusual Charges |
60
60
Loss on Disposal | ||||||||||||||||||||
Asset | Cost of | of Foreign | Severance | |||||||||||||||||
Impairment | Products Sold | Subsidiary | Costs | Total | ||||||||||||||||
Supply Technologies | $ | 6,143 | $ | 4,965 | $ | 1,758 | $ | 564 | $ | 13,430 | ||||||||||
Aluminum Products | 12,575 | 579 | -0- | -0- | 13,154 | |||||||||||||||
Manufactured Products | 4,291 | -0- | -0- | -0- | 4,291 | |||||||||||||||
$ | 23,009 | $ | 5,544 | $ | 1,758 | $ | 564 | $ | 30,875 | |||||||||||
Balance at January 1, 2008 | $ | -0- | ||
Severance costs recorded in 2008 | 564 | |||
Cash payments made in 2008 | (19 | ) | ||
Balance at December 31, 2008 | 545 | |||
Cash payments made in 2009 | (460 | ) | ||
Balance at December 31, 2009 | $ | 85 | ||
Balance at January 1, 2008 | $ | -0- | ||
Severance costs recorded in 2008 | 564 | |||
Cash payments made in 2008 | (19 | ) | ||
Balance at December 31, 2008 | 545 | |||
Cash payments made in 2009 | (460 | ) | ||
Balance at December 31, 2009 | 85 | |||
Cash payments made in 2010 | (85 | ) | ||
Balance at December 31, 2010 | $ | -0- | ||
Asset | Cost of | |||||||||||
Impairment | Products Sold | Total | ||||||||||
Supply Technologies | $ | 2,206 | $ | 1,797 | $ | 4,003 | ||||||
Manufactured Products | 3,000 | -0- | $ | 3,000 | ||||||||
$ | 5,206 | $ | 1,797 | $ | 7,003 | |||||||
61
Quarter Ended | Quarter Ended | |||||||||||||||||||||||||||||||
March 31 | June 30 | Sept. 30 | Dec. 31 | March 31 | June 30 | Sept. 30 | Dec. 31 | |||||||||||||||||||||||||
(Dollars in thousands, except per share data) | (Dollars in thousands, except per share data) | |||||||||||||||||||||||||||||||
2010 | ||||||||||||||||||||||||||||||||
Net sales | $ | 191,701 | $ | 198,303 | $ | 202,986 | $ | 220,532 | ||||||||||||||||||||||||
Gross profit | 29,338 | 33,298 | 34,980 | 36,481 | ||||||||||||||||||||||||||||
Net income (loss) | $ | 2,066 | $ | 3,415 | $ | 6,184 | $ | 3,522 | ||||||||||||||||||||||||
Amounts per common share: | ||||||||||||||||||||||||||||||||
Basic | $ | .19 | $ | .30 | $ | .54 | $ | .31 | ||||||||||||||||||||||||
Diluted | $ | .18 | $ | .29 | $ | .52 | $ | .30 | ||||||||||||||||||||||||
2009 | ||||||||||||||||||||||||||||||||
Net sales | $ | 181,250 | $ | 163,405 | $ | 168,597 | $ | 187,795 | $ | 181,250 | $ | 163,405 | $ | 168,597 | $ | 187,795 | ||||||||||||||||
Gross profit | 23,862 | 29,328 | 22,659 | 27,998 | 23,862 | 29,328 | 22,659 | 27,998 | ||||||||||||||||||||||||
Net income (loss) | $ | (5,462 | ) | $ | 3,272 | $ | (3,224 | ) | $ | 205 | $ | (5,462 | ) | $ | 3,272 | $ | (3,224 | ) | $ | 205 | ||||||||||||
Amounts per common share: | ||||||||||||||||||||||||||||||||
Basic | $ | (.50 | ) | $ | .30 | $ | (.29 | ) | $ | .02 | $ | (.50 | ) | $ | .30 | $ | (.29 | ) | $ | .02 | ||||||||||||
Diluted | $ | (.50 | ) | $ | .29 | $ | (.29 | ) | $ | .02 | $ | (.50 | ) | $ | .29 | $ | (.29 | ) | $ | .02 | ||||||||||||
2008 | ||||||||||||||||||||||||||||||||
Net sales | $ | 267,090 | $ | 285,940 | $ | 266,148 | $ | 249,579 | ||||||||||||||||||||||||
Gross profit | 38,693 | 43,735 | 39,389 | 27,643 | ||||||||||||||||||||||||||||
Net income (loss) | $ | 3,482 | $ | 5,717 | $ | (9,068 | ) | $ | (119,934 | ) | ||||||||||||||||||||||
Amounts per common share: | ||||||||||||||||||||||||||||||||
Basic | $ | .31 | $ | .52 | $ | (.82 | ) | $ | (10.96 | ) | ||||||||||||||||||||||
Diluted | $ | .30 | $ | .49 | $ | (.82 | ) | $ | (10.96 | ) | ||||||||||||||||||||||
Note 1 — | In the second quarter of 2009, the Company recorded a gain of $3,096 on the purchase of $6,125 aggregate principal amount of 8.375% senior subordinated notes due 2014 issued by Park-Ohio Industries, Inc. |
Note 2 — | In the second quarter of 2009, the Company recorded a charge of $2,015 to reserve for an account receivable from a customer in bankruptcy. |
Note 3 — | In the third quarter of 2009, the Company recorded a gain of $2,011 on the purchase of $4,090 aggregate principal amount of 8.375% senior subordinated notes due 2014 issued by Park-Ohio Industries, Inc. |
Note 4 — | In the third quarter of 2009, the Company recorded a charge of $2,139 to reserve for an account receivable from a customer in bankruptcy. |
Note 5 — | In the fourth quarter of 2009, the Company recorded a gain of $1,190 on the purchase of $4,935 aggregate principal amount of 8.375% senior subordinated notes due 2014 issued by Park-Ohio Industries, Inc. |
Note 6 — | In the fourth quarter of 2009, the Company recorded $7,003 of restructuring and asset impairment charges associated with weakness in the general economy, including in the railroad industry. |
Note 7 — | In the third quarter of |
62
63
Balance at | Charged to | Deductions | Balance at | Balance at | Charged to | Deductions | Balance at | |||||||||||||||||||||||||
Beginning of | Costs and | and | End of | Beginning of | Costs and | and | End of | |||||||||||||||||||||||||
Description | Period | Expenses | Other | Period | Period | Expenses | Other | Period | ||||||||||||||||||||||||
Year Ended December 31, 2010: | ||||||||||||||||||||||||||||||||
Allowances deducted from assets: | ||||||||||||||||||||||||||||||||
Trade receivable allowances | $ | 8,388 | $ | 2,581 | $ | (4,958 | )(A) | $ | 6,011 | |||||||||||||||||||||||
Inventory Obsolescence reserve | 21,456 | 8,956 | (7,624 | )(B) | 22,788 | |||||||||||||||||||||||||||
Tax valuation allowances | 30,668 | (5,754 | ) | (2,528 | )(D) | 22,386 | ||||||||||||||||||||||||||
Product warranty liability | 2,760 | 2,294 | (1,008 | )(C) | 4,046 | |||||||||||||||||||||||||||
Year Ended December 31, 2009: | ||||||||||||||||||||||||||||||||
Allowances deducted from assets: | ||||||||||||||||||||||||||||||||
Trade receivable allowances | $ | 3,044 | $ | 6,527 | $ | (1,183 | )(A) | $ | 8,388 | $ | 3,044 | $ | 6,527 | $ | (1,183 | )(A) | $ | 8,388 | ||||||||||||||
Inventory Obsolescence reserve | 22,313 | 7,153 | (8,010 | )(B) | 21,456 | 22,313 | 7,153 | (8,010 | )(B) | 21,456 | ||||||||||||||||||||||
Tax valuation allowances | 34,921 | (1,815 | ) | (2,438 | )(D) | 30,668 | 34,921 | (1,815 | ) | (2,438 | ) | 30,668 | ||||||||||||||||||||
Product warranty liability | 5,402 | 704 | (3,346 | )(C) | 2,760 | 5,402 | 704 | (3,346 | )(C) | 2,760 | ||||||||||||||||||||||
Year Ended December 31, 2008: | ||||||||||||||||||||||||||||||||
Allowances deducted from assets: | ||||||||||||||||||||||||||||||||
Trade receivable allowances | $ | 3,724 | $ | 1,429 | $ | (2,109 | )(A) | $ | 3,044 | $ | 3,724 | $ | 1,429 | $ | (2,109 | )(A) | $ | 3,044 | ||||||||||||||
Inventory Obsolescence reserve | 20,432 | 5,385 | (3,505 | )(B) | 22,312 | 20,432 | 5,385 | (3,505 | )(B) | 22,312 | ||||||||||||||||||||||
Tax valuation allowances | 2,217 | 33,625 | (921 | ) | 34,921 | 2,217 | 33,625 | (921 | )(D) | 34,921 | ||||||||||||||||||||||
Product warranty liability | 5,799 | 4,202 | (4,599 | )(C) | 5,402 | 5,799 | 4,202 | (4,599 | )(C) | 5,402 | ||||||||||||||||||||||
Year Ended December 31, 2007: | ||||||||||||||||||||||||||||||||
Allowances deducted from assets: | ||||||||||||||||||||||||||||||||
Trade receivable allowances | $ | 4,305 | $ | 1,609 | $ | (2,190 | )(A) | $ | 3,724 | |||||||||||||||||||||||
Inventory Obsolescence reserve | 22,978 | 4,383 | (6,929 | )(B) | 20,432 | |||||||||||||||||||||||||||
Tax valuation allowances | 316 | 1,901 | -0- | (D) | 2,217 | |||||||||||||||||||||||||||
Product warranty liability | 3,557 | 4,526 | (2,284 | )(C) | 5,799 | |||||||||||||||||||||||||||
Item 9. | Changes in and Disagreements With Accountants on Accounting and Financial Disclosure |
Item 9A. | Controls and Procedures |
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Item 9B. | Other Information |
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Item 10. | Directors, Executive Officers and Corporate Governance |
Item 11. | Executive Compensation |
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
Number of securities | Number of securities | |||||||||||||||||||||||
Number of securities | Weighted-average | remaining available for | Number of securities | Weighted-average | remaining available for | |||||||||||||||||||
to be issued upon | exercise price of | future issuance under | to be issued upon | exercise price of | future issuance under | |||||||||||||||||||
exercise price of | outstanding | equity compensation plans | exercise price of | outstanding | equity compensation plans | |||||||||||||||||||
outstanding options | options, warrants | (excluding securities | outstanding options | options, warrants | (excluding securities | |||||||||||||||||||
Plan Category | warrants and rights | and rights | reflected in column (a)) | warrants and rights | and rights | reflected in column (a)) | ||||||||||||||||||
(a) | (b) | (c) | (a) | (b) | (c) | |||||||||||||||||||
Equity compensation plans approved by security holders(1) | 408,200 | $ | 6.26 | 899,250 | 458,634 | $ | 6.17 | 331,284 | ||||||||||||||||
Equity compensation plans not approved by security holders | -0- | -0- | -0- | -0- | -0- | -0- | ||||||||||||||||||
Total | 408,200 | $ | 6.26 | 899,250 | 458,634 | $ | 6.17 | 331,284 |
(1) | Includes the Company’s Amended and Restated 1998 Long-Term Incentive Plan. |
6665
Item 13. | Certain Relationships and Related Transactions, and Director Independence |
Item 14. | Principal Accountant Fees and Services |
6766
Item 15. | Exhibits and Financial Statement Schedules |
Page | ||||
Report of Independent Registered Public Accounting Firm | ||||
Report of Independent Registered Public Accounting Firm | ||||
Consolidated Balance Sheets — December 31, 2010 and 2009 | 36 | |||
Consolidated Statements of Operations — Years Ended December 31, 2010, 2009 and 2008 | 37 | |||
Consolidated Statements of | ||||
Consolidated Statements of Cash Flows — Years Ended December 31, 2010, 2009 | ||||
Notes to Consolidated Financial Statements | ||||
Selected Quarterly Financial Data (Unaudited) — Years Ended December 31, | 62 | |||
(2) Financial Statement Schedules | ||||
The following consolidated financial statement schedule of Park-Ohio Holdings Corp. is included in Item 8: | ||||
Schedule II — Valuation and Qualifying accounts |
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By: | /s/ Jeffrey L. Rutherford |
* Edward F. Crawford | Chairman, Chief Executive Officer and Director | March | ||||
* Jeffrey L. Rutherford | Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) | |||||
* Matthew V. Crawford | President, Chief Operating Officer and Director | |||||
* Patrick V. Auletta | Director | |||||
* Kevin R. Greene | Director | |||||
* A. Malachi Mixon, III | Director | |||||
* Dan T. Moore | Director | |||||
* Ronna Romney | Director | |||||
* James W. Wert | Director |
* | The undersigned, pursuant to a Power of Attorney executed by each of the directors and officers identified above and filed with the Securities and Exchange Commission, by signing his name hereto, does hereby sign and execute this report on behalf of each of the persons noted above, in the capacities indicated. |
By: | /s/ Robert D. Vilsack |
6968
Exhibit | ||||
3 | .1 | Amended and Restated Articles of Incorporation of Park-Ohio Holdings Corp. (filed as Exhibit 3.1 to theForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 1998, SECFile No. 000-03134 and incorporated by reference and made a part hereof) | ||
3 | .2 | Code of Regulations of Park-Ohio Holdings Corp. (filed as Exhibit 3.2 to theForm 10-K ofPark-Ohio Holdings Corp. for the year ended December 31, 1998, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
4 | .1 | Second Amended and Restated Credit Agreement, dated June 20, 2007, among Park-Ohio Industries, Inc., the other loan parties thereto, the lenders thereto and JP Morgan Chase Bank, N.A. (successor by merger to Bank One, NA), as agent (filed as exhibit 4.1 toForm 10-Q of Park-Ohio Holdings Corp. on November 9, 2009, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
4 | .2 | Indenture, dated as of November 30, 2004, among Park-Ohio Industries, Inc., the Guarantors (as defined therein) and Wells Fargo Bank, NA, as trustee (filed as Exhibit 4.1 to theForm 8-K of Park-Ohio Holdings Corp. filed on December 6, 2004, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .1 | Form of Indemnification Agreement entered into between Park-Ohio Holdings Corp. and each of its directors and certain officers (filed as Exhibit 10.1 to theForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 1998, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .2* | Amended and Restated 1998 Long-Term Incentive Plan (filed as Exhibit 10.1 toForm 8-K ofPark-Ohio Holdings Corp., filed on June 3, 2009, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .3* | Form of Restricted Share Agreement between the Company and each non-employee director (filed as Exhibit 10.1 toForm 8-K of Park-Ohio Holdings Corp. filed on January 25, 2005, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof). | ||
10 | .4* | Form of Restricted Share Agreement for Employees (filed as Exhibit 10.1 toForm 10-Q forPark-Ohio Holdings Corp. for the quarter ended September 30, 2006, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .5* | Form of Incentive Stock Option Agreement (filed as Exhibit 10.5 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2004, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .6* | Form of Non-Statutory Stock Option Agreement (filed as Exhibit 10.6 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2004, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .7* | Summary of Annual Cash Bonus Plan for Chief Executive Officer (filed as Exhibit 10.1 toForm 10-Q for Park-Ohio Holdings Corp. for the quarter ended March 31, 2005, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .8* | Supplemental Executive Retirement Plan for Edward F. Crawford, effective as of March 10, 2008 (filed as Exhibit 10.9 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2007, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .9* | Non-qualified Defined Contribution Retirement Benefit Letter Agreement for Edward F. Crawford, dated March 10, 2008 (filed as Exhibit 10.10 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2007, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .11 | Agreement of Settlement and Release, dated July 1, 2008 (filed as Exhibit 10.1 toForm 10-Q of Park-Ohio Holdings Corp. for the quarter ended September 30, 2008, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) |
Exhibit | ||||
3 | .1 | Amended and Restated Articles of Incorporation of Park-Ohio Holdings Corp. (filed as Exhibit 3.1 to theForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 1998, SECFile No. 000-03134 and incorporated by reference and made a part hereof) | ||
3 | .2 | Code of Regulations of Park-Ohio Holdings Corp. (filed as Exhibit 3.2 to theForm 10-K ofPark-Ohio Holdings Corp. for the year ended December 31, 1998, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
4 | .1 | Third Amended and Restated Credit Agreement, dated March 8, 2010, among Park-Ohio Industries, Inc., RB&W Corporation of Canada Inc., the Ex-Im Borrowers party thereto, the other loan parties thereto, the lenders party thereto and JP Morgan Chase Bank, N.A., as Administrative Agent, JP Morgan Chase Bank, N.A. Toronto Branch, as Canadian Agent, RBS Business Capital as Syndication Agent, Key Bank National Association , as Co-Documentation Agent, JP Morgan Securities Inc., as Sole Lead Arranger, PNC Bank, National Association, as Joint Bookrunner and U.S. Bank National Association, as Co-Documentation Agent and Joint Bookrunner (filed as Exhibit 4.1 to theForm 10-Q of Park-Ohio Holdings Corp., filed on May 10, 2010, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
4 | .2 | Consent and Amendment No. 1 to Third Amended and Restated Credit Agreement, dated July 9, 2010, among Park-Ohio Industries, Inc., RB&W Corporation of Canada, the Ex-Im Borrowers party to the Credit Agreement, the other loan parties to the Credit Agreement, the lenders party to the Credit Agreement, JP Morgan Chase Bank, N.A., as Administrative Agent, and JP Morgan Chase Bank, N.A., Toronto Branch, as Canadian Agent (filed as Exhibit 4.1 to theForm 10-Q of Park-Ohio Holdings Corp., filed on November 15, 2010, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
4 | .3 | Consent and Amendment No. 2 to Third Amended and Restated Credit Agreement, dated August 31, 2010, among Park-Ohio Industries, Inc., RB&W Corporation of Canada, the Ex-Im Borrowers party to the Credit Agreement, the other loan parties to the Credit Agreement, the lenders party to the Credit Agreement, JP Morgan Chase Bank, N.A., as Administrative Agent, and JP Morgan Chase Bank, N.A., Toronto Branch, as Canadian Agent (filed as Exhibit 4.1 to theForm 10-Q of Park-Ohio Holdings Corp., filed on November 15, 2010, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
4 | .4 | Indenture, dated as of November 30, 2004, among Park-Ohio Industries, Inc., the Guarantors (as defined therein) and Wells Fargo Bank, NA, as trustee (filed as Exhibit 4.1 to theForm 8-K of Park-Ohio Holdings Corp. filed on December 6, 2004, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .1 | Form of Indemnification Agreement entered into between Park-Ohio Holdings Corp. and each of its directors and certain officers (filed as Exhibit 10.1 to theForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 1998, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .2* | Amended and Restated 1998 Long-Term Incentive Plan (filed as Exhibit 10.1 toForm 8-K ofPark-Ohio Holdings Corp., filed on June 3, 2009, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .3* | Form of Restricted Share Agreement between the Company and each non-employee director (filed as Exhibit 10.1 toForm 8-K of Park-Ohio Holdings Corp., filed on January 25, 2005, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .4* | Form of Restricted Share Agreement for Employees (filed as Exhibit 10.1 toForm 10-Q for Park-Ohio Holdings Corp. for the quarter ended September 30, 2006, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) |
7069
Exhibit | ||||
21 | .1 | List of Subsidiaries of Park-Ohio Holdings Corp. | ||
23 | .1 | Consent of Independent Registered Public Accounting Firm | ||
24 | .1 | Power of Attorney | ||
31 | .1 | Principal Executive Officer’s Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
31 | .2 | Principal Financial Officer’s Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
32 | .1 | Certification requirement under Section 906 of the Sarbanes-Oxley Act of 2002 |
Exhibit | ||||
10 | .5* | Form of Incentive Stock Option Agreement (filed as Exhibit 10.5 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2004, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .6* | Form of Non-Statutory Stock Option Agreement (filed as Exhibit 10.6 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2004, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .7* | Park-Ohio Holdings Corp. Annual Cash Bonus Plan (filed as Exhibit 10.2 to theForm 8-K for Park-Ohio Holdings Corp, filed June 1, 2006, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .8* | Supplemental Executive Retirement Plan for Edward F. Crawford, effective as of March 10, 2008 (filed as Exhibit 10.9 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2007, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .9* | Non-qualified Defined Contribution Retirement Benefit Letter Agreement for Edward F. Crawford, dated March 10, 2008 (filed as Exhibit 10.10 toForm 10-K of Park-Ohio Holdings Corp. for the year ended December 31, 2007, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .11 | Agreement of Settlement and Release, dated July 1, 2008 (filed as Exhibit 10.1 toForm 10-Q of Park-Ohio Holdings Corp. for the quarter ended September 30, 2008, SEC FileNo. 000-03134 and incorporated herein by reference and made a part hereof) | ||
10 | .12 | Asset Purchase Agreement, dated as of August 31, 2010, by and among Assembly Component Systems, Inc., Lawson Products, Inc., Supply Technologies LLC and Park-Ohio Industries, Inc. (filed as Exhibit 10.1 to theForm 10-Q of Park-Ohio Holdings Corp., filed on November 15, 2010, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
10 | .13 | Bill of Sale, dated September 30, 2010, by Rome Die Casting LLC and Johnny Johnson in favor of General Aluminum Mfg. Company (filed as Exhibit 10.2 to theForm 10-Q of Park-Ohio Holdings Corp., filed on November 15, 2010, SEC FileNo. 000-03134 and incorporated by reference and made a part hereof) | ||
21 | .1 | List of Subsidiaries of Park-Ohio Holdings Corp. | ||
23 | .1 | Consent of Independent Registered Public Accounting Firm | ||
24 | .1 | Power of Attorney | ||
31 | .1 | Principal Executive Officer’s Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
31 | .2 | Principal Financial Officer’s Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
32 | .1 | Certification requirement under Section 906 of the Sarbanes-Oxley Act of 2002 |
* | Reflects management contract or other compensatory arrangement required to be filed as an exhibit pursuant to Item 15(c) of this Report. |
7170