Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 30, 2019 | Apr. 26, 2019 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | SUN HYDRAULICS CORPORATION | |
Entity Central Index Key | 0001024795 | |
Current Fiscal Year End Date | --12-28 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Document Type | 10-Q | |
Document Period End Date | Mar. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | SNHY | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 32,011,375 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 30, 2019 | Dec. 29, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 16,717 | $ 23,477 |
Restricted cash | 39 | 38 |
Accounts receivable, net of allowance for doubtful accounts of $1,482 and $1,336 | 81,252 | 72,806 |
Inventories, net | 88,896 | 85,989 |
Income taxes receivable | 761 | 4,549 |
Other current assets | 12,465 | 9,997 |
Total current assets | 200,130 | 196,856 |
Property, plant and equipment, net | 145,147 | 126,868 |
Deferred income taxes | 8,411 | 9,463 |
Goodwill | 377,606 | 383,131 |
Other intangibles, net | 311,885 | 320,548 |
Other assets | 4,619 | 5,299 |
Total assets | 1,047,798 | 1,042,165 |
Current liabilities: | ||
Accounts payable | 41,328 | 40,879 |
Accrued compensation and benefits | 15,226 | 13,260 |
Other accrued expenses and current liabilities | 13,096 | 9,941 |
Current portion of contingent consideration | 18,812 | 18,120 |
Current portion of long-term non-revolving debt, net | 5,757 | 5,215 |
Dividends payable | 2,881 | 2,878 |
Income taxes payable | 1,457 | 2,697 |
Total current liabilities | 98,557 | 92,990 |
Revolving line of credit | 242,648 | 255,750 |
Long-term non-revolving debt, net | 89,612 | 91,720 |
Contingent consideration, less current portion | 867 | 840 |
Deferred income taxes | 50,781 | 57,783 |
Other noncurrent liabilities | 24,827 | 12,314 |
Total liabilities | 507,292 | 511,397 |
Commitments and contingencies | ||
Shareholders' equity: | ||
Preferred stock, 2,000,000 shares authorized, par value $0.001, no shares outstanding | ||
Common stock, 50,000,000 shares authorized, par value $0.001, 31,995,700 and 31,964,775 shares outstanding | 32 | 32 |
Capital in excess of par value | 360,195 | 357,933 |
Retained earnings | 232,445 | 219,056 |
Accumulated other comprehensive loss | (52,166) | (46,253) |
Total shareholders' equity | 540,506 | 530,768 |
Total liabilities and shareholders' equity | $ 1,047,798 | $ 1,042,165 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 30, 2019 | Dec. 29, 2018 |
Statement Of Financial Position [Abstract] | ||
Allowance for doubtful accounts, accounts receivable | $ 1,482 | $ 1,336 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares issued | 31,995,700 | 31,964,775 |
Common stock, shares outstanding | 31,995,700 | 31,964,775 |
Consolidated Statements of Oper
Consolidated Statements of Operations (unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 30, 2019 | Mar. 31, 2018 | |
Income Statement [Abstract] | ||
Net sales | $ 146,851 | $ 97,318 |
Cost of sales | 90,342 | 59,701 |
Gross profit | 56,509 | 37,617 |
Selling, engineering and administrative expenses | 26,156 | 18,315 |
Amortization of intangible assets | 4,521 | 2,049 |
Operating income | 25,832 | 17,253 |
Interest expense, net | 4,385 | 483 |
Foreign currency transaction (gain) loss, net | (439) | 511 |
Miscellaneous expense (income), net | 108 | (36) |
Change in fair value of contingent consideration | 719 | 402 |
Income before income taxes | 21,059 | 15,893 |
Income tax provision | 4,655 | 3,982 |
Net income | $ 16,404 | $ 11,911 |
Basic and diluted net income per common share | $ 0.51 | $ 0.40 |
Basic and diluted weighted average shares outstanding | 31,978 | 29,811 |
Dividends declared per share | $ 0.09 | $ 0.09 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 30, 2019 | Mar. 31, 2018 | |
Statement Of Income And Comprehensive Income [Abstract] | ||
Net income | $ 16,404 | $ 11,911 |
Other comprehensive (loss) income | ||
Foreign currency translation adjustments, net of tax | (4,831) | 2,495 |
Unrealized loss on interest rate swap, net of tax | (1,082) | |
Total other comprehensive (loss) income | (5,913) | 2,495 |
Comprehensive income | $ 10,491 | $ 14,406 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Shareholders' Equity (unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Common stock [Member] | Capital in excess of par value | Retained earnings [Member] | Accumulated other comprehensive income (loss) |
Beginning Balance at Dec. 30, 2017 | $ 272,673 | $ 27 | $ 95,354 | $ 183,770 | $ (6,478) |
Beginning Balance, Shares at Dec. 30, 2017 | 27,077 | ||||
Shares issued, Restricted Stock, Shares | 100 | ||||
Shares issued, other compensation, Shares | 7 | ||||
Shares issued, ESPP | 371 | 371 | |||
Shares issued, ESPP, Shares | 9 | ||||
Shares issued, public offering | 239,793 | $ 5 | 239,788 | ||
Shares issued, public offering, Shares | 4,400 | ||||
Stock-based compensation | 916 | 916 | |||
Cancellation of shares for payment of employee tax withholding | (240) | (240) | |||
Cancellation of shares for payment of employee tax withholding, Shares | (5) | ||||
Dividends declared | (2,843) | (2,843) | |||
Net income | 11,911 | 11,911 | |||
Other comprehensive loss | 2,495 | 2,495 | |||
Ending Balance at Mar. 31, 2018 | 525,076 | $ 32 | 336,189 | 192,838 | (3,983) |
Ending Balance, Shares at Mar. 31, 2018 | 31,588 | ||||
Beginning Balance at Dec. 29, 2018 | 530,768 | $ 32 | 357,933 | 219,056 | (46,253) |
Beginning Balance, Shares at Dec. 29, 2018 | 31,965 | ||||
Shares issued, other compensation, Shares | 6 | ||||
Shares issued, ESPP | 408 | 408 | |||
Shares issued, ESPP, Shares | 13 | ||||
Shares issued, ESOP | 1,092 | 1,092 | |||
Shares issued, ESOP, Shares | 24 | ||||
Stock-based compensation | 1,368 | 1,368 | |||
Cancellation of shares for payment of employee tax withholding | (606) | (606) | |||
Cancellation of shares for payment of employee tax withholding, Shares | (12) | ||||
Dividends declared | (2,881) | (2,881) | |||
Net income | 16,404 | 16,404 | |||
Other comprehensive loss | (5,913) | (5,913) | |||
Impact of adoption of ASU 2016-02, related to leases | ASU 2016-02 | (134) | (134) | |||
Ending Balance at Mar. 30, 2019 | $ 540,506 | $ 32 | $ 360,195 | $ 232,445 | $ (52,166) |
Ending Balance, Shares at Mar. 30, 2019 | 31,996 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 30, 2019 | Mar. 31, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 16,404 | $ 11,911 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 8,571 | 4,729 |
Loss on disposal of assets | 71 | |
Stock-based compensation expense | 1,368 | 916 |
Amortization of debt issuance costs | 179 | 98 |
(Benefit) provision for deferred income taxes | (322) | 55 |
Change in fair value of contingent consideration | 719 | 402 |
Forward contract losses, net | 24 | 505 |
Other, net | 549 | (15) |
(Increase) decrease in: | ||
Accounts receivable | (8,848) | (9,683) |
Inventories | (3,729) | 940 |
Other current assets | (2,455) | (219) |
Other assets | 1,088 | (251) |
Increase (decrease) in: | ||
Accounts payable | 662 | 1,114 |
Accrued expenses and other liabilities | 3,496 | 1,469 |
Income taxes payable | 2,710 | 2,671 |
Other noncurrent liabilities | (659) | 17 |
Net cash provided by operating activities | 19,828 | 14,659 |
Cash flows from investing activities: | ||
Capital expenditures | (8,792) | (4,237) |
Proceeds from dispositions of equipment | 64 | 3 |
Net cash used in investing activities | (8,728) | (4,234) |
Cash flows from financing activities: | ||
Borrowings on revolving credit facility | 35,282 | |
Repayment of borrowings on revolving credit facility | (48,000) | (116,000) |
Borrowings on long-term non-revolving debt | 932 | |
Repayment of borrowings on long-term non-revolving debt | (1,623) | |
Proceeds from stock issued | 408 | 240,163 |
Dividends to shareholders | (2,878) | (2,437) |
Other financing activities | (881) | (240) |
Net cash (used in) provided by financing activities | (17,692) | 122,418 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (167) | 1,805 |
Net (decrease) increase in cash, cash equivalents and restricted cash | (6,759) | 134,648 |
Cash, cash equivalents and restricted cash, beginning of period | 23,515 | 63,922 |
Cash, cash equivalents and restricted cash, end of period | $ 16,756 | $ 198,570 |
Company Background
Company Background | 3 Months Ended |
Mar. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
COMPANY BACKGROUND | 1. COMPANY BACKGROUND Sun Hydraulics Corporation, doing business as Helios Technologies (“Helios” or the “Company”), and its wholly-owned subsidiaries, is an industrial technology leader that develops and manufactures solutions for both the hydraulics and electronics markets. On August 6, 2018, the Company announced that it had adopted Helios Technologies as its business name. Sun Hydraulics, LLC (“Sun Hydraulics” or “Sun”), a newly-formed Florida limited liability company that holds the historical net operating assets of the Sun Hydraulics brand entities and Custom Fluidpower Pty Ltd (“Custom Fluidpower”), along with Enovation Controls, LLC (“Enovation Controls”) and Faster S.r.l. (“Faster”) are the wholly-owned operating subsidiaries of Helios Technologies under the new holding company name. The Company operates in two business segments, Hydraulics and Electronics. There are three key technologies within our Hydraulics segment: cartridge valve technology (“CVT”), quick-release hydraulic coupling solutions (“QRC”) and hydraulic system design (“Systems”). Within CVT, our products provide functions important to a hydraulic system: to control rates and direction of fluid flow and to regulate and control pressures. QRC products allow users to connect and disconnect quickly from any hydraulic circuit without leakage and ensure high-performance under high temperature and pressure using one or multiple couplers. Systems provide engineered solutions for machine users, manufacturers or designers to fulfill complete system design requirements including electro-hydraulic, remote control, electronic control and programmable logic controller systems, as well as automation of existing equipment. In our Electronics segment, we are a leader in display and control integration solutions offering rugged and reliable instruments, coupled with expertise in J1939 engine protocol, to produce an industry-leading array of easy-to-read displays and gauges for controller area network (“CAN”) transmitted engine data and faults. We refer to this technology as Electronic Controls (“EC”). The accompanying unaudited interim consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission for reporting on Form 10-Q. Accordingly, certain information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements are not included herein. The financial statements are prepared on a consistent basis (including normal recurring adjustments) and should be read in conjunction with the consolidated financial statements and related notes contained in the Annual Report on Form 10-K for the fiscal year ended December 29, 2018, filed by Sun Hydraulics Corporation with the Securities and Exchange Commission on February 26, 2019. In Management’s opinion, all adjustments necessary for a fair presentation of the Company’s financial statements are reflected in the interim periods presented. Operating results for the three-month period ended March 30, 2019, are not necessarily indicative of the results that may be expected for the period ending December 28, 2019. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 30, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Leases In February 2016, the FASB issued ASU 2016-02, Leases The Company determine s whether an arrangement is a lease at its inception. Operating lease ROU assets represent the Company’s right to use an underlying asset for the lease term and are presented in Property, plant and equipment in the Consolidated Balance Sheets. Operating l ease liabilities represent the Company’s obligation to make lease payments arising from the lease s and are presented in Other accrued expenses and current liabilities and Other noncurrent liabilities in the Consolidated Balance Sheets . ROU assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The Company utilizes an estimated incremental borrowing rate, which is derived from information available at the lease commencement date, in determining the present value of lease payments. The Company considers its existing credit facilities when calculating the incremental borrowing rate. Lease terms include options to extend the lease when it is reasonably certain that the Company will exercise the option. Leases with a term of 12 months or less are not recorded on the balance sheet. There are no residual value guarantees included in the Company’s leases. Contract Assets & Liabilities Contract assets are recognized when the Company has a conditional right to consideration for performance completed on contracts. Contract asset balances totaled $2,175 and $2,851 at March 30, 2019 and December 29, 2018, respectively, and are presented in Other current assets in the Consolidated Balance Sheets. Accounts receivable balances represent unconditional rights to consideration from customers and are presented separate from contract assets in the Consolidated Balance Sheets. Contract liabilities are recognized when payment is received from customers prior to revenue being recognized. Contract liabilities totaled $265 and $138 at March 30, 2019 and December 29, 2018, respectively, and are presented in Other accrued expenses and current liabilities in the Consolidated Balance Sheets. Derivative Instruments and Hedging Activities All derivative instruments are recorded gross in the Consolidated Balance Sheets at their respective fair values. The accounting for changes in the fair value of a derivative instrument depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. For derivative instruments that are designated and qualify as a cash flow hedge, the effective portion of the gain or loss on the derivative instrument is initially reported as a component of accumulated other comprehensive income (“AOCI”) and is subsequently reclassified into the line item within the Consolidated Statements of Operations in which the hedged items are recorded in the same period in which the hedged item affects earnings. The Company enters into foreign exchange currency contracts that are not designated as hedging instruments for accounting purposes. Changes in the fair value of foreign exchange currency contracts not designated as hedging instruments are recognized in earnings. Derivative financial instruments are utilized as risk management tools and are not used for trading or speculative purposes. The Company utilizes foreign currency denominated debt to hedge currency exposure in foreign operations. The Company designates certain foreign currency denominated debt as hedges of net investments in foreign operations which reduces the Company’s exposure to changes in currency exchange rates on investments in non-US subsidiaries. Gains and losses on net investments in non-U.S. operations are economically offset by losses and gains on foreign currency borrowings. The change in the U.S dollar value of foreign currency denominated debt is recorded in Foreign currency translation adjustments, a component of Accumulated other comprehensive income (loss). Research and Development The Company conducts research and development (“R&D”) to create new products and to make improvements to products currently in use. R&D costs are charged to expense as incurred and totaled approximately $3,900, and $2,500 for the three months ended March 30, 2019 and March 31, 2018, respectively. Recently Issued Accounting Standards In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other: Simplifying the Test for Goodwill Impairment. Earnings Per Share The following table presents the computation of basic and diluted earnings per common share (in thousands except per share data): Three Months Ended March 30, 2019 March 31, 2018 Net income $ 16,404 $ 11,911 Basic and diluted weighted average shares outstanding 31,978 29,811 Basic and diluted net income per common share $ 0.51 $ 0.40 |
Business Acquisitions
Business Acquisitions | 3 Months Ended |
Mar. 30, 2019 | |
Business Combinations [Abstract] | |
BUSINESS ACQUISITIONS | 3. BUSINESS ACQUISITIONS Acquisition of Faster On April 5, 2018, the Company completed the acquisition of Faster S.p.A, a worldwide leader in engineering, manufacturing, marketing and distribution of quick release hydraulic coupling solutions headquartered near Milan, Italy. Pursuant to the Share Purchase Agreement, the Company acquired all of the outstanding equity interests of Polyusus Lux IV S.a.r.l., a Luxembourg limited liability company and the owner of 100% of the share capital of Faster S.p.A. The acquisition was completed for cash consideration totaling $532,408 and was financed with cash on hand from the Company’s registered public stock offering and borrowings of $358,000 on its credit facility. Subsequent to the acquisition, the legal structure of Faster was changed to Faster S.r.l. Faster adds adjacent hydraulics products to the Company’s portfolio of products and broadens end market reach, increasing the Company’s presence in the growing agriculture market. The results of Faster’s operations are reported in the Company’s Hydraulics segment and have been included in the consolidated financial statements since the acquisition date. The Share Purchase Agreement allows for future payments to the sellers for certain tax benefits realized within two years of the acquisition date. The estimated fair value of the contingent liability was determined to be $938 as of the acquisition date. See Note 4 for a summary of the change in estimated fair value of the contingent liability. The fair value of total purchase consideration consisted of the following: Cash $ 532,408 Acquisition date fair value of contingent consideration 938 Total purchase consideration 533,346 Less: cash acquired (5,265 ) Total purchase consideration, net of cash acquired $ 528,081 The purchase price was allocated to tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The allocation of the total purchase price, net of cash acquired, is as follows: Accounts receivable $ 24,638 Inventories 34,835 Other current assets 6,661 Property, plant and equipment 20,242 Goodwill 288,449 Intangible assets 248,823 Other assets 7,040 Total assets acquired 630,688 Accounts payable (18,668 ) Accrued expenses (12,223 ) Incomes taxes payable (4,862 ) Other current liabilities (1,289 ) Other noncurrent liabilities (65,565 ) Total liabilities assumed (102,607 ) Fair value of net assets acquired $ 528,081 Goodwill is primarily attributable to Faster’s assembled workforce and anticipated synergies and economies of scale expected from the operations of the combined company. The synergies include certain cost savings, operating efficiencies, and other strategic benefits projected to be achieved as a result of the acquisition. Of the total goodwill acquired, approximately $4,337 is expected to be deductible for tax purposes. Transaction costs of $1,060 incurred in connection with the acquisition are included in Selling, engineering and administrative expenses in the Consolidated Statement of Operations for the three months ended March 31, 2018. Intangible Assets The fair value of identified intangible assets and their respective useful lives are as follows: Fair Value Weighted- Average Amortization Periods (Yrs) Trade name $ 25,740 18 Technology 13,483 13 Customer relationships 202,245 26 Sales order backlog 7,355 0.4 Identified intangible assets $ 248,823 24 Unaudited Pro Forma Information The following unaudited pro forma financial information presents combined results of operations for each of the periods presented, as if Faster had been acquired as of the beginning of 2017. The pro forma information includes adjustments to amortization and depreciation for intangible assets and property, plant and equipment and interest expense from borrowings to fund the acquisition. Non-recurring pro forma adjustments directly attributable to the acquisition included in the pro forma information presented below include transaction costs totaling $1,060, amortization of Faster pre-acquisition loan costs of $2,328 and loss on forward contract entered into in connection with the acquisition totaling $505. The pro forma information does not reflect any operating efficiencies or potential cost savings that may result from the acquisition. Accordingly, the pro forma information is for illustrative purposes only and is not intended to present or be indicative of the actual results of operations of the combined company that may have been achieved had the acquisition actually occurred at the beginning of 2017, nor is it intended to represent or be indicative of future results of operations of the combined business. Consequently, actual results will differ from the unaudited pro forma information presented below. Three months ended March 31, 2018 Net sales $ 138,258 Operating income 25,982 Net income 14,874 Basic and diluted net income per common share 0.47 Acquisition of Custom Fluidpower On August 1, 2018, the Company acquired all of the outstanding equity interests of Custom Fluidpower Pty Ltd, an Australian proprietary limited liability company. The acquisition was completed pursuant to a Share Sale Agreement among the Company and the shareholders of Custom Fluidpower. The fair value of consideration paid at closing totaled $26,655 and included 333,065 shares of the Company’s common stock and cash of $9,315; cash paid net of cash acquired totaled $7,518. The cash consideration was funded with borrowings on the Company’s credit facility. Custom Fluidpower was acquired to further diversify the Company’s hydraulics product and service portfolio and broaden the Company’s global footprint. The results of Custom Fluidpower’s operations are reported in the Company’s Hydraulics segment and have been included in the consolidated financial statements since the date of acquisition. The Company recorded $5,111 in goodwill and $7,556 in other identifiable intangible assets in connection with the acquisition; however, the purchase price allocation is preliminary, pending final intangibles valuation and tax related adjustments, and may be revised during the remainder of the measurement period (which will not exceed 12 months from the acquisition date). Any such revisions or changes to the fair values of the tangible and intangible assets acquired and liabilities assumed may be material. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | 4. FAIR VALUE OF FINANCIAL INSTRUMENTS The following tables provide information regarding the Company’s assets and liabilities measured at fair value on a recurring basis at March 30, 2019 and December 29, 2018. March 30, 2019 Quoted Market Significant Other Observable Significant Unobservable Total Prices (Level 1) Inputs (Level 2) Inputs (Level 3) Liabilities Interest rate swap contract $ 3,831 $ — $ 3,831 $ — Contingent consideration 19,679 — — 19,679 Total $ 23,510 $ — $ 3,831 $ 19,679 December 29, 2018 Quoted Market Significant Other Observable Significant Unobservable Total Prices (Level 1) Inputs (Level 2) Inputs (Level 3) Liabilities Interest rate swap contract $ 2,309 $ — $ 2,309 $ — Forward foreign exchange contracts 137 — 137 — Contingent consideration 18,960 — — 18,960 Total $ 21,406 $ — $ 2,446 $ 18,960 A summary of the changes in the estimated fair value of contingent consideration at March 30, 2019 is as follows: Balance, December 29, 2018 $ 18,960 Change in estimated fair value 719 Balance, March 30, 2019 $ 19,679 During the first quarter of 2019, the Company reco rded an adjustment to the estimated fair value of the contingent consideration liability incurred in connection with the acquisition of Faster. The adjustment was the result of revised estimates of future payments owed to the sellers for certain tax benefits to be realized. |
Inventories
Inventories | 3 Months Ended |
Mar. 30, 2019 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | 5. INVENTORIES March 30, 2019 December 29, 2018 Raw materials $ 38,285 $ 39,086 Work in process 29,605 26,871 Finished goods 26,120 23,963 Provision for obsolete and slow moving inventory (5,114 ) (3,931 ) Total $ 88,896 $ 85,989 |
Operating Leases
Operating Leases | 3 Months Ended |
Mar. 30, 2019 | |
Leases [Abstract] | |
OPERATING LEASES | 6. OPERATING LEASES The Company leases machinery, equipment, vehicles, buildings and office space throughout its locations, which are classified as operating leases. Remaining terms on these leases range from less than one year to 11 years. For the three months ended March 30, 2019, operating lease costs totaled $908. Supplemental balance sheet information related to operating leases is as follows: March 30, 2019 Right-of-use assets $ 14,069 Current operating lease liabilities $ 2,904 Non-current operating lease liabilities 11,305 Total operating lease liabilities $ 14,209 Weighted average remaining lease term (in years): 6.0 Weighted average discount rate: 4.6 % Supplemental cash flow and other information related to leases is as follows: Three Months Ended March 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 913 ROU assets obtained in exchange for new operating lease liabilities $ 901 Maturities of lease liabilities are as follows: March 30, 2019 2019 Remaining $ 2,710 2020 3,504 2021 3,448 2022 1,702 2023 1,356 2024 985 Thereafter 2,893 Total lease payments 16,598 Less: Imputed interest (2,389 ) Total lease obligations 14,209 Less: Current lease liabilities (2,904 ) Non-current lease liabilities $ 11,305 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 30, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | 7. GOODWILL AND INTANGIBLE ASSETS Goodwill A summary of changes in goodwill by segment for the three months ended March 30, 2019, is as follows: Hydraulics Electronics Total Balance at December 29, 2018 $ 276,758 $ 106,373 $ 383,131 Faster acquisition measurement period adjustment (343 ) — (343 ) Currency translation (5,182 ) — (5,182 ) Balance at March 30, 2019 $ 271,233 $ 106,373 $ 377,606 Intangible Assets At March 30, 2019, and December 29, 2018, intangible assets consisted of the following: March 30, 2019 December 29, 2018 Gross carrying amount Accumulated amortization Net carrying amount Gross carrying amount Accumulated amortization Net carrying amount Definite-lived intangibles: Trade names and brands $ 56,155 $ (5,429 ) $ 50,726 $ 56,604 $ (4,712 ) $ 51,892 Non-compete agreements 950 (443 ) 507 950 (396 ) 554 Technology 31,770 (6,268 ) 25,502 32,004 (5,488 ) 26,516 Supply agreement 21,000 (4,900 ) 16,100 21,000 (4,375 ) 16,625 Customer relationships 228,650 (12,394 ) 216,256 232,275 (10,168 ) 222,107 Licensing agreement 3,716 (922 ) 2,794 3,716 (862 ) 2,854 $ 342,241 $ (30,356 ) $ 311,885 $ 346,549 $ (26,001 ) $ 320,548 Amortization expense for the three months ended March 30, 2019, and March 31, 2018, was $4,521 and $2,049, respectively. Remaining amortization for 2019 is approximately $13,706. Total estimated amortization expense for the years 2020 through 2024 is presented below. Year: 2020 $ 18,164 2021 18,064 2022 17,801 2023 17,741 2024 17,087 Total $ 88,857 |
Derivative Instruments & Hedgin
Derivative Instruments & Hedging Activities | 3 Months Ended |
Mar. 30, 2019 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS & HEDGING ACTIVITIES | 8. DERIVATIVE INSTRUMENTS & HEDGING ACTIVITIES The Company addresses certain financial exposures through a controlled program of risk management that includes the use of derivative financial instruments and hedging activities. The fair value of the Company’s derivative financial instruments included in the Consolidated Balance Sheets are presented as follows: Asset Derivatives Liability Derivatives Balance Sheet Fair Value (1) Fair Value (1) Balance Sheet Fair Value (1) Fair Value (1) Location March 30, 2019 December 29, 2018 Location March 30, 2019 December 29, 2018 Derivatives designated as hedging instruments: Interest rate swap contract Other assets $ — $ — Other non-current liabilities $ 3,831 $ 2,309 Derivatives not designated as hedging instruments: Forward foreign exchange contract Other current assets — — Other current liabilities — 137 Total derivatives $ — $ — $ 3,831 $ 2,446 The amount of gains and losses related to the Company’s derivative financial instruments are presented as follows: Amount of Gain or (Loss) Recognized in OCI on Derivatives (Effective Portion) Location of Gain or (Loss) Reclassified from AOCI Amount of Gain or (Loss) Reclassified from AOCI into Earnings (Effective Portion) March 30, 2019 March 31, 2018 into Earnings (Effective Portion) March 30, 2019 March 31, 2018 Derivatives in cash flow hedging relationships: Interest rate swap contract $ (1,521 ) $ — Interest expense, net $ (183 ) $ — Interest expense presented in the Consolidated Statements of Operations, in which the effects of cash flow hedges are recorded, totaled $4,385 for the three months ended March 30, 2019. Amount of Gain or (Loss) Recognized in Earnings on Derivatives Location of Gain or (Loss) Recognized March 30, 2019 March 31, 2018 in Earnings on Derivatives Derivatives not designated as hedging instruments: Forward foreign exchange contracts $ (24 ) $ (505 ) Foreign currency transaction gain loss, net Interest Rate Swap Contract Helios primarily utilizes variable-rate debt to finance its operations. The debt obligations expose the Company to variability in interest payments. The Company enters into various types of derivative instruments to manage fluctuations in cash flows resulting from interest rate risk attributable to changes in the benchmark interest rates. The Company has entered into an interest rate swap transaction to hedge the variable interest rate payments on the credit facilities. In connection with this transaction, the Company pays interest based upon a fixed rate as agreed upon with the respective counterparties and receives variable rate interest payments based on the one-month LIBOR. The interest rate swap has an aggregate notional amount of $200,000, which decreases by $25,000 annually starting in July 2019, and has been designated as a hedging instrument and accounted for as a cash flow hedge. The interest rate swap was effective on August 2, 2018 and is scheduled to expire on April 3, 2023. The contract is settled with the respective counterparties on a net basis at each settlement date. Forward Foreign Exchange Contracts The Company has entered into forward contracts to economically hedge transactional exposure associated with commitments arising from transactions denominated in a currency other than the functional currency of the respective operating entity. The Company’s forward contracts were not designated as hedging instruments for accounting purposes. During the quarter ended March 31, 2018, the Company entered into a forward foreign exchange currency contract, for the purchase of €370,000, to economically hedge transactional exposure associated with the acquisition of Faster, which was denominated in euros. The contract settled upon closing of the acquisition of Faster. As of March 30, 2019, the Company did not have any forward foreign exchange contracts. Net Investment Hedge The Company utilizes foreign currency denominated debt to hedge currency exposure in foreign operations. During the first quarter of fiscal year 2019, the Company designated €30,000 of borrowings on the revolving credit facility as a net investment hedge of a portion of the Company’s European operations. The carrying value of the euro denominated debt totaled $33,648 as of March 30, 2019 and is included in the Revolving line of credit line item on the Consolidated Balance Sheets. The gain or loss on the net investment hedge recorded in AOCI as part of the currency translation adjustment was a gain of $273, net of tax, for the quarter ended March 30, 2019. No amounts associated with the net investment hedge were reclassified from AOCI into income for the quarter ended March 30, 2019. |
Credit Facilities
Credit Facilities | 3 Months Ended |
Mar. 30, 2019 | |
Debt Disclosure [Abstract] | |
CREDIT FACILITIES | 9. CREDIT FACILITIES Total long-term non-revolving debt consists of the following: Maturity Date March 30, 2019 December 29, 2018 Long-term non-revolving debt: Term loan credit facility with PNC Bank 4/3/2023 $ 95,000 $ 96,250 Term loan credit facility with Shinhan Bank 3/30/2020 880 895 Other long-term debt Various 475 838 Total long-term non-revolving debt 96,355 97,983 Less: current portion of long-term non-revolving debt 5,757 5,215 Less: unamortized debt issuance costs 986 1,048 Total long-term non-revolving debt, net $ 89,612 $ 91,720 Information on the Company’s revolving credit facilities is as follows: Balance Available credit Maturity Date March 30, 2019 December 29, 2018 March 30, 2019 December 29, 2018 Revolving line of credit with PNC 4/3/2023 $ 242,648 $ 255,750 $ 157,352 $ 144,250 Future maturities of total debt are as follows: Year: 2019 Remaining $ 3,843 2020 7,268 2021 7,656 2022 8,834 2023 311,402 Total $ 339,003 The Company has a revolving line of credit and term loan credit facility with PNC Bank, National Association, as administrative agent, and the lenders party thereto. The revolving line of credit allows for up to an aggregate maximum principal amount of $ 400,000 €30,000 in order to hedge currency exposure in foreign operations. The effective interest rate on the credit agreement at March 30, 2019 was 4.24%. Interest expense recognized on the credit agreement during the three months ended March 30, 2019 and March 31, 2018, totaled $ 4,164 The Company has a credit agreement with Shinhan Bank that provides a term loan of 1,000,000 March 2020 2.05 The Company had a revolving line of credit with National Australia Bank that allowed for maximum borrowings of 3,000 Australian dollars. Principal and interest were paid in full on January 31, 2019, at which time the facility was closed. The Company’s other long-term debt primarily consists of auto loans payable to National Australia Bank. Principal and interest payments are due monthly. The loans mature at various dates through January 2024. Interest is charged at various rates ranging from 4.0% to 5.3%. |
Public Stock Offering
Public Stock Offering | 3 Months Ended |
Mar. 30, 2019 | |
Equity [Abstract] | |
PUBLIC STOCK OFFERING | 10. PUBLIC STOCK OFFERING On February 6, 2018, the Company completed a public offering of its common stock, pursuant to which the Company sold 4,400,000 shares at a public offering price of $57.50 per share. The Company received net proceeds from the sale totaling $239,793, after deducting the underwriting discount and other offering expenses. The Company used the net proceeds for the repayment of debt under its credit facility and to partially fund the acquisition of Faster, which closed on April 5, 2018. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 11. INCOME TAXES At March 30, 2019, the Company had an unrecognized tax benefit of $6,899 including accrued interest. If recognized, the unrecognized tax benefit would have a favorable effect on the effective tax rate in future periods. The Company recognizes interest and penalties related to income tax matters in income tax expense. Interest accrued as of March 30, 2019 is not considered material to the Company’s consolidated financial statements. The Company files U.S. federal income tax returns as well as income tax returns in various states and foreign jurisdictions. The Company is no longer subject to income tax examinations by tax authorities for years prior to 2008 for the majority of tax jurisdictions where the Company files tax returns. The Company’s U.S. federal income tax returns are currently under examination by the Internal Revenue Service (IRS) in the United States for the periods 2008 through 2012. Florida income tax returns for tax years 2015 and 2016 are under examination. The 2016 pre-acquisition Italian income tax return for Faster is also under examination. To date, there have not been any significant proposed adjustments that have not been accounted for in the Company’s consolidated financial statements. Audit outcomes and the timing of audit settlements are subject to significant uncertainty. It is reasonably possible that within the next twelve months, the Company will resolve some or all of the matters presently under consideration for both its federal and state examinations and there could be significant increases or decreases to unrecognized tax benefits. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 30, 2019 | |
Share Based Compensation [Abstract] | |
STOCK-BASED COMPENSATION | 12. STOCK-BASED COMPENSATION Equity Incentive Plan The Company’s 2011 Equity Incentive Plan provides for the grant of shares of restricted stock, restricted share units, stock appreciation rights, dividend or dividend equivalent rights, stock awards and other awards valued in whole or in part by reference to or otherwise based on the Company’s common stock, to officers, employees and directors of the Company. Restricted Stock and Restricted Stock Units The Company grants restricted shares of common stock and restricted stock units (“RSU”) in connection with a long-term incentive plan. Awards with time-based vesting requirements vest ratably over a three-year period. Awards with performance based vesting requirements cliff vest after a three-year performance cycle and only after the achievement of certain performance criteria over that cycle. Compensation expense recognized for restricted stock and RSUs totaled $811 and $495, respectively, for the three months ended March 30, 2019, and March 31, 2018. The following table summarizes restricted stock and RSU activity for the three months ended March 30, 2019: Weighted average Number of shares grant-date (in thousands) fair value Nonvested balance at December 29, 2018 146 $ 48.66 Granted (1) 126 37.95 Vested (42 ) 47.05 Forfeited (13 ) 47.90 Nonvested balance at March 30, 2019 217 $ 42.78 (1 ) The Company had $8,708 of total unrecognized compensation cost related to the restricted stock and RSU awards granted under the 2011 Plan as of March 30, 2019. That cost is expected to be recognized over a weighted average period of 2.1 years. Employee Stock Purchase Plans The Company maintains an Employee Stock Purchase Plan (“ESPP”) in which the U.S. employees of Helios, Sun Hydraulics and Enovation Controls are eligible to participate. Employees in the United States who choose to participate are granted an opportunity to purchase common stock at 85 percent of market value on the first or last day of the quarterly purchase period, whichever is lower. Employees in the United Kingdom, under a separate plan, are granted an opportunity to purchase the Company’s common stock at market value, on the first or last day of the quarterly purchase period, whichever is lower, with the Company issuing one additional free share of common stock for each six shares purchased by the employee under the plan. Employees purchased 14,387 shares at a weighted average price of $28.37, and 8,110 shares at a weighted average price of $45.79, under the ESPP and U.K. plans during the three months ended March 30, 2019, and March 31, 2018, respectively. The Company recognized $255 and $63 of compensation expense during the three months ended March 30, 2019, and March 31, 2018, respectively. Nonemployee Director Fees Plan The Company’s 2012 Nonemployee Director Fees Plan compensates nonemployee Directors for their board service with shares of common stock. Directors were granted 5,875 and 6,625 shares for the three months ended March 30, 2019 and March 31, 2018, respectively. The Company recognized director stock compensation expense of $285 and $365 for the three months ended March 30, 2019 and March 31, 2018, respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Mar. 30, 2019 | |
Accumulated Other Comprehensive Income Loss Net Of Tax [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | 13. ACCUMULATED OTHER COMPREHENSIVE LOSS The following tables presents changes in accumulated other comprehensive loss by component: Unrealized Gains and Losses on Derivative Instruments Foreign Currency Items Total Balance at December 29, 2018 $ (2,309 ) $ (43,944 ) $ (46,253 ) Other comprehensive loss before reclassifications (1,666 ) (7,239 ) (8,905 ) Amounts reclassified from accumulated other comprehensive loss 144 — 144 Tax effect 440 2,408 2,848 Net current period other comprehensive loss (1,082 ) (4,831 ) (5,913 ) Balance at March 30, 2019 $ (3,391 ) $ (48,775 ) $ (52,166 ) Unrealized Gains and Losses on Derivative Instruments Foreign Currency Items Total Balance at December 30, 2017 $ — $ (6,478 ) $ (6,478 ) Other comprehensive income before reclassifications — 2,495 2,495 Amounts reclassified from accumulated other comprehensive loss — — — Net current period other comprehensive income — 2,495 2,495 Balance at March 31, 2018 $ — $ (3,983 ) $ (3,983 ) |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 30, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | 14. SEGMENT REPORTING The Company has two reportable business segments: Hydraulics and Electronics. These segments are organized primarily based on the similar nature of products offered for sale, the types of customers served and the methods of distribution and are consistent with how the segments are managed, how resources are allocated and how information is used by the chief operating decision makers. The Company evaluates performance and allocates resources based primarily on segment operating income. Certain costs were not allocated to the business segments as they are not used in evaluating the results of, or in allocating resources to the Company’s segments. These costs are presented in the Corporate and other line item below. For the three months ended March 30, 2019, the unallocated costs included certain corporate costs not deemed to be allocable to either business segment of $4,442 which primarily relate to the amortization of acquisition-related intangible assets. The accounting policies of the Company’s business segments are the same as those used to prepare the accompanying consolidated financial statements. The following table presents financial information by reportable segment: Three months ended March 30, 2019 March 31, 2018 Net sales Hydraulics $ 116,463 $ 62,609 Electronics 30,388 34,709 Total $ 146,851 $ 97,318 Operating income Hydraulics $ 23,762 $ 13,442 Electronics 6,512 7,107 Corporate and other (4,442 ) (3,296 ) Total $ 25,832 $ 17,253 Capital expenditures Hydraulics $ 8,145 $ 3,977 Electronics 647 260 Total $ 8,792 $ 4,237 March 30, 2019 December 29, 2018 Total assets Hydraulics $ 776,622 $ 771,409 Electronics 264,998 263,412 Corporate 6,178 7,344 Total $ 1,047,798 $ 1,042,165 Geographic Region Information Net sales are measured based on the geographic destination of sales. Tangible long-lived assets are shown based on the physical location of the assets and primarily include net property, plant and equipment and exclude ROU assets: Three months ended March 30, 2019 March 31, 2018 Net sales Americas $ 67,706 $ 56,471 Europe/Middle East/Africa 44,220 22,351 Asia/Pacific 34,925 18,496 Total $ 146,851 $ 97,318 March 30, 2019 December 29, 2018 Tangible long-lived assets Americas $ 85,125 $ 83,664 Europe/Middle East/Africa 29,342 26,724 Asia/Pacific 16,611 16,480 Total $ 131,078 $ 126,868 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 30, 2019 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 15. RELATED PARTY TRANSACTIONS Enovation Controls purchases and sells inventory to an entity partially owned by one of its officers. For the three months ended March 30, 2019, and March 31, 2018, inventory sales to the entity totaled $482 and $861, respectively, and inventory purchases from the entity totaled $1,455 and $1,751, respectively. At March 30, 2019, and December 29, 2018, amounts due from the entity totaled $216 and $296, respectively, and amounts due to the entity totaled $489 and $631, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 30, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 16. COMMITMENTS AND CONTINGENCIES Legal Proceedings The Company is not a party to any legal proceedings other than routine litigation incidental to its business. In the opinion of management, the amount of ultimate liability with respect to these actions will not materially affect the results of operations, financial position or cash flows of the Company. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 30, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 17. SUBSEQUENT EVENTS During April 2019, in accordance with the contingent consideration arrangement for the acquisition of Enovation Controls, the Company made the third and final payment to Enovation Controls’ former owners totaling $17,795. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 30, 2019 | |
Accounting Policies [Abstract] | |
Leases | Leases In February 2016, the FASB issued ASU 2016-02, Leases The Company determine s whether an arrangement is a lease at its inception. Operating lease ROU assets represent the Company’s right to use an underlying asset for the lease term and are presented in Property, plant and equipment in the Consolidated Balance Sheets. Operating l ease liabilities represent the Company’s obligation to make lease payments arising from the lease s and are presented in Other accrued expenses and current liabilities and Other noncurrent liabilities in the Consolidated Balance Sheets . ROU assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The Company utilizes an estimated incremental borrowing rate, which is derived from information available at the lease commencement date, in determining the present value of lease payments. The Company considers its existing credit facilities when calculating the incremental borrowing rate. Lease terms include options to extend the lease when it is reasonably certain that the Company will exercise the option. Leases with a term of 12 months or less are not recorded on the balance sheet. There are no residual value guarantees included in the Company’s leases. |
Contract Assets & Liabilities | Contract Assets & Liabilities Contract assets are recognized when the Company has a conditional right to consideration for performance completed on contracts. Contract asset balances totaled $2,175 and $2,851 at March 30, 2019 and December 29, 2018, respectively, and are presented in Other current assets in the Consolidated Balance Sheets. Accounts receivable balances represent unconditional rights to consideration from customers and are presented separate from contract assets in the Consolidated Balance Sheets. Contract liabilities are recognized when payment is received from customers prior to revenue being recognized. Contract liabilities totaled $265 and $138 at March 30, 2019 and December 29, 2018, respectively, and are presented in Other accrued expenses and current liabilities in the Consolidated Balance Sheets. |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities All derivative instruments are recorded gross in the Consolidated Balance Sheets at their respective fair values. The accounting for changes in the fair value of a derivative instrument depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. For derivative instruments that are designated and qualify as a cash flow hedge, the effective portion of the gain or loss on the derivative instrument is initially reported as a component of accumulated other comprehensive income (“AOCI”) and is subsequently reclassified into the line item within the Consolidated Statements of Operations in which the hedged items are recorded in the same period in which the hedged item affects earnings. The Company enters into foreign exchange currency contracts that are not designated as hedging instruments for accounting purposes. Changes in the fair value of foreign exchange currency contracts not designated as hedging instruments are recognized in earnings. Derivative financial instruments are utilized as risk management tools and are not used for trading or speculative purposes. The Company utilizes foreign currency denominated debt to hedge currency exposure in foreign operations. The Company designates certain foreign currency denominated debt as hedges of net investments in foreign operations which reduces the Company’s exposure to changes in currency exchange rates on investments in non-US subsidiaries. Gains and losses on net investments in non-U.S. operations are economically offset by losses and gains on foreign currency borrowings. The change in the U.S dollar value of foreign currency denominated debt is recorded in Foreign currency translation adjustments, a component of Accumulated other comprehensive income (loss). |
Research and Development | Research and Development The Company conducts research and development (“R&D”) to create new products and to make improvements to products currently in use. R&D costs are charged to expense as incurred and totaled approximately $3,900, and $2,500 for the three months ended March 30, 2019 and March 31, 2018, respectively. |
Recently Issued Accounting Standard | Recently Issued Accounting Standards In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other: Simplifying the Test for Goodwill Impairment. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 30, 2019 | |
Accounting Policies [Abstract] | |
Computation of basic and diluted earnings per common share | The following table presents the computation of basic and diluted earnings per common share (in thousands except per share data): Three Months Ended March 30, 2019 March 31, 2018 Net income $ 16,404 $ 11,911 Basic and diluted weighted average shares outstanding 31,978 29,811 Basic and diluted net income per common share $ 0.51 $ 0.40 |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 3 Months Ended |
Mar. 30, 2019 | |
Summary of Pro forma Financial Information | Consequently, actual results will differ from the unaudited pro forma information presented below. Three months ended March 31, 2018 Net sales $ 138,258 Operating income 25,982 Net income 14,874 Basic and diluted net income per common share 0.47 |
Faster S.r.l [Member] | |
Components of Fair Value of Total Purchase Consideration | The fair value of total purchase consideration consisted of the following: Cash $ 532,408 Acquisition date fair value of contingent consideration 938 Total purchase consideration 533,346 Less: cash acquired (5,265 ) Total purchase consideration, net of cash acquired $ 528,081 |
Schedule of Allocation of Total Purchase Price, Net of Cash Acquired | The purchase price was allocated to tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The allocation of the total purchase price, net of cash acquired, is as follows: Accounts receivable $ 24,638 Inventories 34,835 Other current assets 6,661 Property, plant and equipment 20,242 Goodwill 288,449 Intangible assets 248,823 Other assets 7,040 Total assets acquired 630,688 Accounts payable (18,668 ) Accrued expenses (12,223 ) Incomes taxes payable (4,862 ) Other current liabilities (1,289 ) Other noncurrent liabilities (65,565 ) Total liabilities assumed (102,607 ) Fair value of net assets acquired $ 528,081 |
Schedule of Fair Value of Identified Intangible Assets and Useful Lives | The fair value of identified intangible assets and their respective useful lives are as follows: Fair Value Weighted- Average Amortization Periods (Yrs) Trade name $ 25,740 18 Technology 13,483 13 Customer relationships 202,245 26 Sales order backlog 7,355 0.4 Identified intangible assets $ 248,823 24 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets and liabilities measured at fair value on a recurring basis | The following tables provide information regarding the Company’s assets and liabilities measured at fair value on a recurring basis at March 30, 2019 and December 29, 2018. March 30, 2019 Quoted Market Significant Other Observable Significant Unobservable Total Prices (Level 1) Inputs (Level 2) Inputs (Level 3) Liabilities Interest rate swap contract $ 3,831 $ — $ 3,831 $ — Contingent consideration 19,679 — — 19,679 Total $ 23,510 $ — $ 3,831 $ 19,679 December 29, 2018 Quoted Market Significant Other Observable Significant Unobservable Total Prices (Level 1) Inputs (Level 2) Inputs (Level 3) Liabilities Interest rate swap contract $ 2,309 $ — $ 2,309 $ — Forward foreign exchange contracts 137 — 137 — Contingent consideration 18,960 — — 18,960 Total $ 21,406 $ — $ 2,446 $ 18,960 |
Summary of changes in estimated fair value of contingent consideration | A summary of the changes in the estimated fair value of contingent consideration at March 30, 2019 is as follows: Balance, December 29, 2018 $ 18,960 Change in estimated fair value 719 Balance, March 30, 2019 $ 19,679 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Summary of inventories | March 30, 2019 December 29, 2018 Raw materials $ 38,285 $ 39,086 Work in process 29,605 26,871 Finished goods 26,120 23,963 Provision for obsolete and slow moving inventory (5,114 ) (3,931 ) Total $ 88,896 $ 85,989 |
Operating Leases (Tables)
Operating Leases (Tables) | 3 Months Ended |
Mar. 30, 2019 | |
Leases [Abstract] | |
Supplemental Balance Sheet Information Related to Operating Leases | Supplemental balance sheet information related to operating leases is as follows: March 30, 2019 Right-of-use assets $ 14,069 Current operating lease liabilities $ 2,904 Non-current operating lease liabilities 11,305 Total operating lease liabilities $ 14,209 Weighted average remaining lease term (in years): 6.0 Weighted average discount rate: 4.6 % |
Supplemental Cash Flow and Other Information Related to Leases | Supplemental cash flow and other information related to leases is as follows: Three Months Ended March 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 913 ROU assets obtained in exchange for new operating lease liabilities $ 901 |
Maturities of Lease Liabilities | Maturities of lease liabilities are as follows: March 30, 2019 2019 Remaining $ 2,710 2020 3,504 2021 3,448 2022 1,702 2023 1,356 2024 985 Thereafter 2,893 Total lease payments 16,598 Less: Imputed interest (2,389 ) Total lease obligations 14,209 Less: Current lease liabilities (2,904 ) Non-current lease liabilities $ 11,305 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 30, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Summary of changes in goodwill | Goodwill A summary of changes in goodwill by segment for the three months ended March 30, 2019, is as follows: Hydraulics Electronics Total Balance at December 29, 2018 $ 276,758 $ 106,373 $ 383,131 Faster acquisition measurement period adjustment (343 ) — (343 ) Currency translation (5,182 ) — (5,182 ) Balance at March 30, 2019 $ 271,233 $ 106,373 $ 377,606 |
Schedule of intangible assets | Intangible Assets At March 30, 2019, and December 29, 2018, intangible assets consisted of the following: March 30, 2019 December 29, 2018 Gross carrying amount Accumulated amortization Net carrying amount Gross carrying amount Accumulated amortization Net carrying amount Definite-lived intangibles: Trade names and brands $ 56,155 $ (5,429 ) $ 50,726 $ 56,604 $ (4,712 ) $ 51,892 Non-compete agreements 950 (443 ) 507 950 (396 ) 554 Technology 31,770 (6,268 ) 25,502 32,004 (5,488 ) 26,516 Supply agreement 21,000 (4,900 ) 16,100 21,000 (4,375 ) 16,625 Customer relationships 228,650 (12,394 ) 216,256 232,275 (10,168 ) 222,107 Licensing agreement 3,716 (922 ) 2,794 3,716 (862 ) 2,854 $ 342,241 $ (30,356 ) $ 311,885 $ 346,549 $ (26,001 ) $ 320,548 |
Schedule of estimated amortization expense of intangible assets | Amortization expense for the three months ended March 30, 2019, and March 31, 2018, was $4,521 and $2,049, respectively. Remaining amortization for 2019 is approximately $13,706. Total estimated amortization expense for the years 2020 through 2024 is presented below. Year: 2020 $ 18,164 2021 18,064 2022 17,801 2023 17,741 2024 17,087 Total $ 88,857 |
Derivative Instruments & Hedg_2
Derivative Instruments & Hedging Activities (Tables) | 3 Months Ended |
Mar. 30, 2019 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Schedule of Fair Value of Derivative Financial Instruments Included in Consolidated Balance Sheets | The fair value of the Company’s derivative financial instruments included in the Consolidated Balance Sheets are presented as follows: Asset Derivatives Liability Derivatives Balance Sheet Fair Value (1) Fair Value (1) Balance Sheet Fair Value (1) Fair Value (1) Location March 30, 2019 December 29, 2018 Location March 30, 2019 December 29, 2018 Derivatives designated as hedging instruments: Interest rate swap contract Other assets $ — $ — Other non-current liabilities $ 3,831 $ 2,309 Derivatives not designated as hedging instruments: Forward foreign exchange contract Other current assets — — Other current liabilities — 137 Total derivatives $ — $ — $ 3,831 $ 2,446 |
Schedule of Gains and Losses Related to Derivative Financial Instruments | The amount of gains and losses related to the Company’s derivative financial instruments are presented as follows: Amount of Gain or (Loss) Recognized in OCI on Derivatives (Effective Portion) Location of Gain or (Loss) Reclassified from AOCI Amount of Gain or (Loss) Reclassified from AOCI into Earnings (Effective Portion) March 30, 2019 March 31, 2018 into Earnings (Effective Portion) March 30, 2019 March 31, 2018 Derivatives in cash flow hedging relationships: Interest rate swap contract $ (1,521 ) $ — Interest expense, net $ (183 ) $ — Amount of Gain or (Loss) Recognized in Earnings on Derivatives Location of Gain or (Loss) Recognized March 30, 2019 March 31, 2018 in Earnings on Derivatives Derivatives not designated as hedging instruments: Forward foreign exchange contracts $ (24 ) $ (505 ) Foreign currency transaction gain loss, net |
Credit Facilities (Tables)
Credit Facilities (Tables) | 3 Months Ended |
Mar. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Total Long-Term Non-Revolving Debt | Total long-term non-revolving debt consists of the following: Maturity Date March 30, 2019 December 29, 2018 Long-term non-revolving debt: Term loan credit facility with PNC Bank 4/3/2023 $ 95,000 $ 96,250 Term loan credit facility with Shinhan Bank 3/30/2020 880 895 Other long-term debt Various 475 838 Total long-term non-revolving debt 96,355 97,983 Less: current portion of long-term non-revolving debt 5,757 5,215 Less: unamortized debt issuance costs 986 1,048 Total long-term non-revolving debt, net $ 89,612 $ 91,720 |
Summary of Information on Revolving Credit Facilities | Information on the Company’s revolving credit facilities is as follows: Balance Available credit Maturity Date March 30, 2019 December 29, 2018 March 30, 2019 December 29, 2018 Revolving line of credit with PNC 4/3/2023 $ 242,648 $ 255,750 $ 157,352 $ 144,250 |
Summary of Future Maturities of Total Debt | Future maturities of total debt are as follows: Year: 2019 Remaining $ 3,843 2020 7,268 2021 7,656 2022 8,834 2023 311,402 Total $ 339,003 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 30, 2019 | |
Share Based Compensation [Abstract] | |
Summary of Restricted Stock And RSU Activity | The following table summarizes restricted stock and RSU activity for the three months ended March 30, 2019: Weighted average Number of shares grant-date (in thousands) fair value Nonvested balance at December 29, 2018 146 $ 48.66 Granted (1) 126 37.95 Vested (42 ) 47.05 Forfeited (13 ) 47.90 Nonvested balance at March 30, 2019 217 $ 42.78 (1 ) |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Mar. 30, 2019 | |
Accumulated Other Comprehensive Income Loss Net Of Tax [Abstract] | |
Changes in Accumulated Other Comprehensive Loss by Component | The following tables presents changes in accumulated other comprehensive loss by component: Unrealized Gains and Losses on Derivative Instruments Foreign Currency Items Total Balance at December 29, 2018 $ (2,309 ) $ (43,944 ) $ (46,253 ) Other comprehensive loss before reclassifications (1,666 ) (7,239 ) (8,905 ) Amounts reclassified from accumulated other comprehensive loss 144 — 144 Tax effect 440 2,408 2,848 Net current period other comprehensive loss (1,082 ) (4,831 ) (5,913 ) Balance at March 30, 2019 $ (3,391 ) $ (48,775 ) $ (52,166 ) Unrealized Gains and Losses on Derivative Instruments Foreign Currency Items Total Balance at December 30, 2017 $ — $ (6,478 ) $ (6,478 ) Other comprehensive income before reclassifications — 2,495 2,495 Amounts reclassified from accumulated other comprehensive loss — — — Net current period other comprehensive income — 2,495 2,495 Balance at March 31, 2018 $ — $ (3,983 ) $ (3,983 ) |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of financial information by reportable segment | The following table presents financial information by reportable segment: Three months ended March 30, 2019 March 31, 2018 Net sales Hydraulics $ 116,463 $ 62,609 Electronics 30,388 34,709 Total $ 146,851 $ 97,318 Operating income Hydraulics $ 23,762 $ 13,442 Electronics 6,512 7,107 Corporate and other (4,442 ) (3,296 ) Total $ 25,832 $ 17,253 Capital expenditures Hydraulics $ 8,145 $ 3,977 Electronics 647 260 Total $ 8,792 $ 4,237 March 30, 2019 December 29, 2018 Total assets Hydraulics $ 776,622 $ 771,409 Electronics 264,998 263,412 Corporate 6,178 7,344 Total $ 1,047,798 $ 1,042,165 |
Schedule of geographic region information | Tangible long-lived assets are shown based on the physical location of the assets and primarily include net property, plant and equipment and exclude ROU assets: Three months ended March 30, 2019 March 31, 2018 Net sales Americas $ 67,706 $ 56,471 Europe/Middle East/Africa 44,220 22,351 Asia/Pacific 34,925 18,496 Total $ 146,851 $ 97,318 March 30, 2019 December 29, 2018 Tangible long-lived assets Americas $ 85,125 $ 83,664 Europe/Middle East/Africa 29,342 26,724 Asia/Pacific 16,611 16,480 Total $ 131,078 $ 126,868 |
Company Background (Details Tex
Company Background (Details Textual) | 3 Months Ended |
Mar. 30, 2019Segment | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Number of operating segments | 2 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 30, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | Dec. 29, 2018 | |
Summary of Significant Accounting Policies [Line Items] | ||||
Operating lease, right-of-use assets | $ 14,069 | |||
Operating lease, right-of-use liabilities | 14,209 | |||
Contract asset, current | 2,175 | $ 2,851 | ||
Contract Liabilities, current | 265 | $ 138 | ||
Research and development costs charged to expense | $ 3,900 | $ 2,500 | ||
Accounting Standards Update 2016-02 [Member] | ||||
Summary of Significant Accounting Policies [Line Items] | ||||
Operating lease, right-of-use assets | $ 13,918 | |||
Operating lease, right-of-use liabilities | 13,918 | |||
Cumulative-effect adjustment recognized in retained earnings | $ 134 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 30, 2019 | Mar. 31, 2018 | |
Earnings Per Share [Abstract] | ||
Net income | $ 16,404 | $ 11,911 |
Basic and diluted weighted average shares outstanding | 31,978 | 29,811 |
Basic and diluted net income per common share | $ 0.51 | $ 0.40 |
Business Acquisitions (Details
Business Acquisitions (Details Textual) - USD ($) $ in Thousands | Aug. 01, 2018 | Apr. 05, 2018 | Mar. 30, 2019 | Mar. 31, 2018 | Dec. 29, 2018 |
Business Acquisition [Line Items] | |||||
Borrowings on credit facility | $ 35,282 | ||||
Goodwill | $ 377,606 | $ 383,131 | |||
Faster S.r.l [Member] | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, date of acquisition | Apr. 5, 2018 | ||||
Business acquisition of outstanding equity interest percentage | 100.00% | ||||
Cash consideration transferred | $ 532,408 | ||||
Maximum tax benefits realization period | 2 years | ||||
Estimated fair value of contingent liability | $ 938 | ||||
Business acquisition, goodwill expected tax deductible amount | 4,337 | ||||
Acquisition-related costs (included in Selling, engineering, and administrative expenses) | $ 1,060 | ||||
Accelerated amortization of pre acquisition loan costs | 2,328 | ||||
Loss on forward contract | $ (505) | ||||
Total purchase consideration | 533,346 | ||||
Total purchase consideration, net of cash acquired | 528,081 | ||||
Goodwill | 288,449 | ||||
Faster S.r.l [Member] | Revolving Credit and Term Loan Facility [Member] | |||||
Business Acquisition [Line Items] | |||||
Borrowings on credit facility | $ 358,000 | ||||
Custom Fluidpower [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash consideration transferred | $ 9,315 | ||||
Total purchase consideration | $ 26,655 | ||||
Consideration paid in shares of common stock | 333,065 | ||||
Total purchase consideration, net of cash acquired | $ 7,518 | ||||
Goodwill | 5,111 | ||||
Other identifiable intangible assets | $ 7,556 |
Business Acquisitions (Details)
Business Acquisitions (Details) - Faster S.r.l [Member] $ in Thousands | Apr. 05, 2018USD ($) |
Business Acquisition [Line Items] | |
Cash | $ 532,408 |
Acquisition date fair value of contingent consideration | 938 |
Total purchase consideration | 533,346 |
Less: cash acquired | (5,265) |
Total purchase consideration, net of cash acquired | $ 528,081 |
Business Acquisitions (Detail_2
Business Acquisitions (Details 1) - USD ($) $ in Thousands | Mar. 30, 2019 | Dec. 29, 2018 | Apr. 05, 2018 |
Business Acquisition [Line Items] | |||
Goodwill | $ 377,606 | $ 383,131 | |
Faster S.r.l [Member] | |||
Business Acquisition [Line Items] | |||
Accounts receivable | $ 24,638 | ||
Inventories | 34,835 | ||
Other current assets | 6,661 | ||
Property, plant and equipment | 20,242 | ||
Goodwill | 288,449 | ||
Intangible assets | 248,823 | ||
Other assets | 7,040 | ||
Total assets acquired | 630,688 | ||
Accounts payable | (18,668) | ||
Accrued expenses | (12,223) | ||
Incomes taxes payable | (4,862) | ||
Other current liabilities | (1,289) | ||
Other noncurrent liabilities | (65,565) | ||
Total liabilities assumed | (102,607) | ||
Fair value of net assets acquired | $ 528,081 |
Business Acquisitions (Detail_3
Business Acquisitions (Details 2) - Faster S.r.l [Member] $ in Thousands | Apr. 05, 2018USD ($) |
Business Acquisition [Line Items] | |
Intangible assets | $ 248,823 |
Weighted-Average Amortization Periods (Yrs) | 24 years |
Trade Name [Member] | |
Business Acquisition [Line Items] | |
Intangible assets | $ 25,740 |
Weighted-Average Amortization Periods (Yrs) | 18 years |
Technology [Member] | |
Business Acquisition [Line Items] | |
Intangible assets | $ 13,483 |
Weighted-Average Amortization Periods (Yrs) | 13 years |
Customer relationships [Member] | |
Business Acquisition [Line Items] | |
Intangible assets | $ 202,245 |
Weighted-Average Amortization Periods (Yrs) | 26 years |
Sales order backlog [Member] | |
Business Acquisition [Line Items] | |
Intangible assets | $ 7,355 |
Weighted-Average Amortization Periods (Yrs) | 4 months 24 days |
Business Acquisitions (Detail_4
Business Acquisitions (Details 3) $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2018USD ($)$ / shares | |
Business Combinations [Abstract] | |
Net sales | $ 138,258 |
Operating income | 25,982 |
Net income | $ 14,874 |
Basic and diluted net income per common share | $ / shares | $ 0.47 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - Recurring [Member] - USD ($) $ in Thousands | Mar. 30, 2019 | Dec. 29, 2018 |
Liabilities | ||
Liabilities measured at fair value | $ 23,510 | $ 21,406 |
Interest Rate Swap Contract [Member] | ||
Liabilities | ||
Liabilities measured at fair value | 3,831 | 2,309 |
Forward Foreign Exchange Contracts [Member] | ||
Liabilities | ||
Liabilities measured at fair value | 137 | |
Level 2 [Member] | ||
Liabilities | ||
Liabilities measured at fair value | 3,831 | 2,446 |
Level 2 [Member] | Interest Rate Swap Contract [Member] | ||
Liabilities | ||
Liabilities measured at fair value | 3,831 | 2,309 |
Level 2 [Member] | Forward Foreign Exchange Contracts [Member] | ||
Liabilities | ||
Liabilities measured at fair value | 137 | |
Level 3 [Member] | ||
Liabilities | ||
Liabilities measured at fair value | 19,679 | 18,960 |
Contingent Consideration [Member] | ||
Liabilities | ||
Liabilities measured at fair value | 19,679 | 18,960 |
Contingent Consideration [Member] | Level 3 [Member] | ||
Liabilities | ||
Liabilities measured at fair value | $ 19,679 | $ 18,960 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments (Details 1) - Faster S.p.A [Member] $ in Thousands | 3 Months Ended |
Mar. 30, 2019USD ($) | |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |
Beginning Balance | $ 18,960 |
Change in estimated fair value | 719 |
Ending Balance | $ 19,679 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 30, 2019 | Dec. 29, 2018 |
Summary of inventories | ||
Raw materials | $ 38,285 | $ 39,086 |
Work in process | 29,605 | 26,871 |
Finished goods | 26,120 | 23,963 |
Provision for obsolete and slow moving inventory | (5,114) | (3,931) |
Total | $ 88,896 | $ 85,989 |
Operating Leases (Details Textu
Operating Leases (Details Textual) $ in Thousands | 3 Months Ended |
Mar. 30, 2019USD ($) | |
Leases [Line Items] | |
Operating lease cost | $ 908 |
Minimum [Member] | |
Leases [Line Items] | |
Operating leases, remaining lease term | 1 year |
Maximum [Member] | |
Leases [Line Items] | |
Operating leases, remaining lease term | 11 years |
Operating Leases (Details)
Operating Leases (Details) $ in Thousands | Mar. 30, 2019USD ($) |
Leases [Abstract] | |
Right-of-use assets | $ 14,069 |
Current operating lease liabilities | 2,904 |
Non-current operating lease liabilities | 11,305 |
Total operating lease liabilities | $ 14,209 |
Weighted average remaining lease term (in years): | 6 years |
Weighted average discount rate: | 4.60% |
Operating Leases (Details 1)
Operating Leases (Details 1) $ in Thousands | 3 Months Ended |
Mar. 30, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows from operating leases | $ 913 |
ROU assets obtained in exchange for new operating lease liabilities | $ 901 |
Operating Leases (Details 2)
Operating Leases (Details 2) $ in Thousands | Mar. 30, 2019USD ($) |
Leases [Abstract] | |
2019 Remaining | $ 2,710 |
2020 | 3,504 |
2021 | 3,448 |
2022 | 1,702 |
2023 | 1,356 |
2024 | 985 |
Thereafter | 2,893 |
Total lease payments | 16,598 |
Less: Imputed interest | (2,389) |
Total lease obligations | 14,209 |
Less: Current lease liabilities | (2,904) |
Non-current lease liabilities | $ 11,305 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Details) $ in Thousands | 3 Months Ended |
Mar. 30, 2019USD ($) | |
Goodwill [Line Items] | |
Goodwill, Beginning Balance | $ 383,131 |
Currency translation | (5,182) |
Goodwill, Ending Balance | 377,606 |
Faster S.r.l [Member] | |
Goodwill [Line Items] | |
Faster acquisition measurement period adjustment | (343) |
Hydraulics [Member] | |
Goodwill [Line Items] | |
Goodwill, Beginning Balance | 276,758 |
Currency translation | (5,182) |
Goodwill, Ending Balance | 271,233 |
Hydraulics [Member] | Faster S.r.l [Member] | |
Goodwill [Line Items] | |
Faster acquisition measurement period adjustment | (343) |
Electronics [Member] | |
Goodwill [Line Items] | |
Goodwill, Beginning Balance | 106,373 |
Currency translation | 0 |
Goodwill, Ending Balance | 106,373 |
Electronics [Member] | Faster S.r.l [Member] | |
Goodwill [Line Items] | |
Faster acquisition measurement period adjustment | $ 0 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Details 1) - USD ($) $ in Thousands | Mar. 30, 2019 | Dec. 29, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 342,241 | $ 346,549 |
Accumulated amortization | (30,356) | (26,001) |
Net carrying amount | 311,885 | 320,548 |
Trade names and brands [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 56,155 | 56,604 |
Accumulated amortization | (5,429) | (4,712) |
Net carrying amount | 50,726 | 51,892 |
Non-compete agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 950 | 950 |
Accumulated amortization | (443) | (396) |
Net carrying amount | 507 | 554 |
Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 31,770 | 32,004 |
Accumulated amortization | (6,268) | (5,488) |
Net carrying amount | 25,502 | 26,516 |
Supply agreement [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 21,000 | 21,000 |
Accumulated amortization | (4,900) | (4,375) |
Net carrying amount | 16,100 | 16,625 |
Customer relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 228,650 | 232,275 |
Accumulated amortization | (12,394) | (10,168) |
Net carrying amount | 216,256 | 222,107 |
Licensing agreement [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 3,716 | 3,716 |
Accumulated amortization | (922) | (862) |
Net carrying amount | $ 2,794 | $ 2,854 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 30, 2019 | Mar. 31, 2018 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 4,521 | $ 2,049 |
Remaining amortization expense for 2019 | $ 13,706 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets (Details 2) $ in Thousands | Mar. 30, 2019USD ($) |
Goodwill And Intangible Assets Disclosure [Abstract] | |
2020 | $ 18,164 |
2021 | 18,064 |
2022 | 17,801 |
2023 | 17,741 |
2024 | 17,087 |
Total | $ 88,857 |
Derivative Instruments & Hedg_3
Derivative Instruments & Hedging Activities (Details) - USD ($) $ in Thousands | Mar. 30, 2019 | Dec. 29, 2018 |
Derivatives Fair Value [Line Items] | ||
Total Liability Derivatives, Fair Value | $ 3,831 | $ 2,446 |
Derivatives Designated as Hedging Instruments [Member] | Interest Rate Swap Contract [Member] | Other Non-current Liabilities [Member] | ||
Derivatives Fair Value [Line Items] | ||
Liability Derivatives Non-current, Fair Value | $ 3,831 | 2,309 |
Derivatives Not Designated as Hedging Instruments [Member] | Forward Foreign Exchange Contract [Member] | Other Current Liabilities [Member] | ||
Derivatives Fair Value [Line Items] | ||
Liability Derivatives Current, Fair Value | $ 137 |
Derivative Instruments & Hedg_4
Derivative Instruments & Hedging Activities (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 30, 2019 | Mar. 31, 2018 | |
Derivative Instruments And Hedging Activities Disclosures [Line Items] | ||
Amount of Gain or (Loss) Recognized in OCI on Derivatives (Effective Portion) | $ (1,082) | |
Derivatives Designated as Hedging Instruments [Member] | Cash Flow Hedging [Member] | Interest Rate Swap Contract [Member] | ||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | ||
Amount of Gain or (Loss) Recognized in OCI on Derivatives (Effective Portion) | (1,521) | |
Derivatives Designated as Hedging Instruments [Member] | Cash Flow Hedging [Member] | Interest Rate Swap Contract [Member] | Interest Expense, Net [Member] | ||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | ||
Amount of Gain or (Loss) Reclassified from AOCI into Earnings (Effective Portion) | (183) | |
Derivatives Not Designated as Hedging Instruments [Member] | Forward Foreign Exchange Contracts [Member] | Foreign Currency Transaction Gain Loss, Net [Member] | ||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | ||
Amount of Gain or (Loss) Recognized in Earnings on Derivatives | $ (24) | $ (505) |
Derivative Instruments & Hedg_5
Derivative Instruments & Hedging Activities (Details Textual) € in Thousands | 3 Months Ended | ||||
Mar. 30, 2019USD ($) | Mar. 31, 2018USD ($) | Mar. 30, 2019EUR (€) | Dec. 29, 2018USD ($) | Mar. 31, 2018EUR (€) | |
Derivative Instruments And Hedging Activities Disclosures [Line Items] | |||||
Interest expense | $ 4,385,000 | $ 483,000 | |||
Purchase amount of forward foreign exchange currency contract | € | € 370,000 | ||||
Carrying value of total long term non-revolving debt | 96,355,000 | $ 97,983,000 | |||
Gain loss on derivative hedge recorded in AOCI as a part of currency translation adjustment | 273,000 | ||||
Net investment hedge reclassified from AOCI into income | 0 | ||||
Europe [Member] | |||||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | |||||
Carrying value of total long term non-revolving debt | 33,648,000 | ||||
Revolving Credit Facility [Member] | Europe [Member] | |||||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | |||||
Net investment hedge | € | € 30,000 | ||||
Cash Flow Hedging [Member] | |||||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | |||||
Interest expense | 4,385,000 | ||||
Cash Flow Hedging [Member] | Interest Rate Swap Contract [Member] | Derivatives Designated as Hedging Instruments [Member] | |||||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | |||||
Derivative instrument, notional amount | 200,000,000 | ||||
Annual decrease in derivative notional amount | $ 25,000,000 | ||||
Derivative contract effective date | Aug. 2, 2018 | ||||
Derivative contract expire date | Apr. 3, 2023 |
Credit Facilities (Details)
Credit Facilities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 30, 2019 | Dec. 29, 2018 | |
Debt Instrument [Line Items] | ||
Other long-term debt, Maturity Date | Various | |
Total long-term non-revolving debt | $ 96,355 | $ 97,983 |
Other long-term debt | 475 | 838 |
Less: current portion of long-term non-revolving debt | 5,757 | 5,215 |
Less: unamortized debt issuance costs | 986 | 1,048 |
Total long-term non-revolving debt, net | $ 89,612 | 91,720 |
PNC Bank, National Association, as Administrative Agent, and Lender Party [Member] | ||
Debt Instrument [Line Items] | ||
Term loan credit facility, Maturity Date | Apr. 3, 2023 | |
Total long-term non-revolving debt | $ 95,000 | 96,250 |
Shinhan Bank [Member] | ||
Debt Instrument [Line Items] | ||
Term loan credit facility, Maturity Date | Mar. 30, 2020 | |
Total long-term non-revolving debt | $ 880 | $ 895 |
Credit Facilities (Details 1)
Credit Facilities (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 30, 2019 | Dec. 29, 2018 | |
Debt Instrument [Line Items] | ||
Revolving line of credit | $ 242,648 | $ 255,750 |
PNC [Member] | Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Date | Apr. 3, 2023 | |
Revolving line of credit | $ 242,648 | 255,750 |
Available credit | $ 157,352 | $ 144,250 |
Credit Facilities (Details 2)
Credit Facilities (Details 2) $ in Thousands | Mar. 30, 2019USD ($) |
Debt Disclosure [Abstract] | |
2019 Remaining | $ 3,843 |
2020 | 7,268 |
2021 | 7,656 |
2022 | 8,834 |
2023 | 311,402 |
Total | $ 339,003 |
Credit Facilities (Details Text
Credit Facilities (Details Textual) € in Thousands, ₩ in Thousands | 3 Months Ended | |||
Mar. 30, 2019USD ($) | Mar. 31, 2018USD ($) | Mar. 30, 2019EUR (€) | Mar. 30, 2019KRW (₩) | |
Debt Instrument [Line Items] | ||||
Loans maturity, description | Various | |||
PNC Bank, National Association, as Administrative Agent, and Lender Party [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest expense recognized | $ 4,164,000 | $ 702,000 | ||
Loan maturity date | Apr. 3, 2023 | |||
PNC Bank, National Association, as Administrative Agent, and Lender Party [Member] | Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facilities, maximum capacity | $ 400,000,000 | |||
Net investment hedge | € | € 30,000 | |||
Effective interest rate | 4.24% | 4.24% | 4.24% | |
Shinhan Bank [Member] | ||||
Debt Instrument [Line Items] | ||||
Loan maturity date | Mar. 30, 2020 | |||
Shinhan Bank [Member] | Term Loan [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facilities, maximum capacity | ₩ | ₩ 1,000,000 | |||
Effective interest rate | 2.05% | 2.05% | 2.05% | |
Loan maturity date | Mar. 30, 2020 | |||
National Australia Bank [Member] | Other Long-Term Debt [Member] | ||||
Debt Instrument [Line Items] | ||||
Loans, frequency of payments | monthly | |||
Loans maturity, description | The loans mature at various dates through January 2024. | |||
National Australia Bank [Member] | Minimum [Member] | Other Long-Term Debt [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rates | 4.00% | 4.00% | 4.00% | |
National Australia Bank [Member] | Maximum [Member] | Other Long-Term Debt [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rates | 5.30% | 5.30% | 5.30% | |
National Australia Bank [Member] | Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facilities, maximum capacity | $ 3,000,000 |
Public Stock Offering (Details
Public Stock Offering (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | Feb. 06, 2018 | Mar. 30, 2019 | Mar. 31, 2018 |
Subsidiary Sale Of Stock [Line Items] | |||
Proceeds from stock issued | $ 408 | $ 240,163 | |
Common stock [Member] | |||
Subsidiary Sale Of Stock [Line Items] | |||
Sale of stock | 4,400,000 | ||
Common stock [Member] | Public Offering [Member] | |||
Subsidiary Sale Of Stock [Line Items] | |||
Sale of stock | 4,400,000 | ||
Shares price per share | $ 57.50 | ||
Proceeds from stock issued | $ 239,793 |
Income Taxes (Details Textual)
Income Taxes (Details Textual) $ in Thousands | 3 Months Ended |
Mar. 30, 2019USD ($) | |
Income Tax Disclosure [Abstract] | |
Unrecognized tax benefit | $ 6,899 |
Federal returns currently under examination | The Company’s U.S. federal income tax returns are currently under examination by the Internal Revenue Service (IRS) in the United States for the periods 2008 through 2012. Florida income tax returns for tax years 2015 and 2016 are under examination. The 2016 pre-acquisition Italian income tax return for Faster is also under examination. |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 30, 2019 | Mar. 31, 2018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Ratio for additional common stock shares issued, under ESPP | 16.67% | |
2012 Nonemployee Director Fees Plan [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Award of shares granted (in shares) | 5,875 | 6,625 |
Share-based compensation expenses under Director's plan | $ 285 | $ 365 |
Employee Stock Purchase Plan [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Rate of common stock at market value | 85.00% | |
Employee Stock Purchase Plan and U.K. Plan [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of shares purchased by employees | 14,387 | 8,110 |
Weighted average price | $ 28.37 | $ 45.79 |
Share-based compensation expenses | $ 255 | $ 63 |
Time Based [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Vesting period | 3 years | |
Performance Based [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Vesting period | 3 years | |
Restricted Stock and Restricted Stock Units [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Compensation expense | $ 811 | $ 495 |
Equity Incentive Plan (2011 Plan) [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total unrecognized compensation | $ 8,708 | |
Recognized weighted average period (in years) | 2 years 1 month 6 days |
Stock-Based Compensation (Det_2
Stock-Based Compensation (Details) shares in Thousands | 3 Months Ended |
Mar. 30, 2019$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Nonvested Beginning balance Number of shares | shares | 146 |
Granted, Number of shares | shares | 126 |
Vested, Number of shares | shares | (42) |
Forfeited, Number of shares | shares | (13) |
Nonvested Ending balance Number of shares | shares | 217 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |
Nonvested Beginning balance, Weighted average grant-date fair value | $ / shares | $ 48.66 |
Granted, Weighted average grant-date fair value | $ / shares | 37.95 |
Vested, Weighted average grant-date fair value | $ / shares | 47.05 |
Forfeited, Weighted average grant-date fair value | $ / shares | 47.90 |
Nonvested Ending balance, Weighted average grant-date fair value | $ / shares | $ 42.78 |
Stock-Based Compensation (Paren
Stock-Based Compensation (Parenthetical) (Details) | 3 Months Ended |
Mar. 30, 2019shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Granted, Number of shares | 126,000 |
RSUs [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Granted, Number of shares | 34,000 |
RSUs [Member] | Minimum [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Target vested amount percentage | 0.00% |
RSUs [Member] | Maximum [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Target vested amount percentage | 150.00% |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss - Changes in AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 30, 2019 | Mar. 31, 2018 | |
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Beginning Balance | $ 530,768 | $ 272,673 |
Ending Balance | 540,506 | 525,076 |
Unrealized Gains and Losses on Derivative Instruments [Member] | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Beginning Balance | (2,309) | |
Other comprehensive income (loss) before reclassifications | (1,666) | |
Amounts reclassified from accumulated other comprehensive loss | 144 | |
Tax effect | 440 | |
Net current period other comprehensive (loss) income | (1,082) | |
Ending Balance | (3,391) | |
Foreign Currency Items [Member] | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Beginning Balance | (43,944) | (6,478) |
Other comprehensive income (loss) before reclassifications | (7,239) | 2,495 |
Tax effect | 2,408 | |
Net current period other comprehensive (loss) income | (4,831) | 2,495 |
Ending Balance | (48,775) | (3,983) |
Accumulated other comprehensive income (loss) [Member] | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Beginning Balance | (46,253) | (6,478) |
Other comprehensive income (loss) before reclassifications | (8,905) | 2,495 |
Amounts reclassified from accumulated other comprehensive loss | 144 | |
Tax effect | 2,848 | |
Net current period other comprehensive (loss) income | (5,913) | 2,495 |
Ending Balance | $ (52,166) | $ (3,983) |
Segment Reporting (Details Text
Segment Reporting (Details Textual) $ in Thousands | 3 Months Ended |
Mar. 30, 2019USD ($)Segment | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | Segment | 2 |
Corporate and Other [Member] | |
Segment Reporting Information [Line Items] | |
Amortization of Acquisition-related intangible assets | $ | $ 4,442 |
Segment Reporting (Details 1)
Segment Reporting (Details 1) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 30, 2019 | Mar. 31, 2018 | Dec. 29, 2018 | |
Segment Reporting Information [Line Items] | |||
Net sales | $ 146,851 | $ 97,318 | |
Operating income | 25,832 | 17,253 | |
Capital expenditures | 8,792 | 4,237 | |
Total assets | 1,047,798 | $ 1,042,165 | |
Operating Segments [Member] | Hydraulics [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | 116,463 | 62,609 | |
Operating income | 23,762 | 13,442 | |
Capital expenditures | 8,145 | 3,977 | |
Total assets | 776,622 | 771,409 | |
Operating Segments [Member] | Electronics [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | 30,388 | 34,709 | |
Operating income | 6,512 | 7,107 | |
Capital expenditures | 647 | 260 | |
Total assets | 264,998 | 263,412 | |
Corporate and Other [Member] | |||
Segment Reporting Information [Line Items] | |||
Operating income | (4,442) | $ (3,296) | |
Total assets | $ 6,178 | $ 7,344 |
Segment Reporting (Details 2)
Segment Reporting (Details 2) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 30, 2019 | Mar. 31, 2018 | Dec. 29, 2018 | |
Net sales | |||
Net sales | $ 146,851 | $ 97,318 | |
Tangible long-lived assets | |||
Tangible long-lived assets | 131,078 | $ 126,868 | |
Americas [Member] | |||
Net sales | |||
Net sales | 67,706 | 56,471 | |
Tangible long-lived assets | |||
Tangible long-lived assets | 85,125 | 83,664 | |
Europe/Middle East/Africa [Member] | |||
Net sales | |||
Net sales | 44,220 | 22,351 | |
Tangible long-lived assets | |||
Tangible long-lived assets | 29,342 | 26,724 | |
Asia/Pacific [Member] | |||
Net sales | |||
Net sales | 34,925 | $ 18,496 | |
Tangible long-lived assets | |||
Tangible long-lived assets | $ 16,611 | $ 16,480 |
Related Party Transactions (Det
Related Party Transactions (Details Textual) - Enovation Controls [Member] $ in Thousands | 3 Months Ended | ||
Mar. 30, 2019USD ($)Officer | Mar. 31, 2018USD ($) | Dec. 29, 2018USD ($) | |
Related Party Transaction [Line Items] | |||
Due from entity | $ 216 | $ 296 | |
Due to entity | $ 489 | $ 631 | |
Inventory Transactions [Member] | |||
Related Party Transaction [Line Items] | |||
Number of officers purchasing and selling inventory | Officer | 1 | ||
Total sales to entity | $ 482 | $ 861 | |
Total purchases from entity/related party | $ 1,455 | $ 1,751 |
Subsequent Events (Details Text
Subsequent Events (Details Textual) $ in Thousands | Apr. 30, 2019USD ($) |
Enovation Controls [Member] | Subsequent Event [Member] | |
Subsequent Event [Line Items] | |
Estimated fair value of contingent liability | $ 17,795 |