Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Jan. 02, 2015 | Mar. 03, 2015 | Jul. 03, 2014 |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | GREATBATCH, INC. | ||
Entity Central Index Key | 1114483 | ||
Document Type | 10-K | ||
Document Period End Date | 2-Jan-15 | ||
Amendment Flag | FALSE | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | -1 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $1,212 | ||
Entity Common Stock, Shares Outstanding | 25,354,051 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $76,824 | $35,465 |
Accounts receivable, net of allowance for doubtful accounts of $1.4 million in 2014 and $2.0 million in 2013 | 124,953 | 113,679 |
Inventories | 129,242 | 118,358 |
Refundable income taxes | 1,716 | 2,306 |
Deferred income taxes | 6,168 | 6,008 |
Prepaid expenses and other current assets | 11,780 | 6,717 |
Total current assets | 350,683 | 282,533 |
Property, plant and equipment, net | 144,925 | 145,773 |
Amortizing intangible assets, net | 65,337 | 76,122 |
Indefinite-lived intangible assets | 20,288 | 20,288 |
Goodwill | 354,393 | 346,656 |
Deferred income taxes | 2,626 | 2,933 |
Other assets | 17,757 | 16,398 |
Total assets | 956,009 | 890,703 |
Current liabilities: | ||
Current portion of long-term debt | 11,250 | 0 |
Accounts payable | 46,436 | 46,508 |
Income taxes payable | 2,003 | 0 |
Deferred income taxes | 588 | 613 |
Accrued expenses | 48,384 | 44,681 |
Total current liabilities | 108,661 | 91,802 |
Long-term debt | 176,250 | 197,500 |
Deferred income taxes | 53,195 | 52,012 |
Other long-term liabilities | 4,541 | 7,334 |
Total liabilities | 342,647 | 348,648 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value, authorized 100,000,000 shares; no shares issued or outstanding in 2014 or 2013 | 0 | 0 |
Common stock, $0.001 par value, authorized 100,000,000 shares; 25,099,293 shares issued and 25,070,931 shares outstanding in 2014; 24,459,153 shares issued and 24,422,555 shares outstanding in 2013 | 25 | 24 |
Additional paid-in capital | 366,073 | 344,915 |
Treasury stock, at cost, 28,362 shares in 2014 and 36,598 shares in 2013 | -1,307 | -1,232 |
Retained earnings | 239,448 | 183,990 |
Accumulated other comprehensive income | 9,123 | 14,358 |
Total stockholders’ equity | 613,362 | 542,055 |
Total liabilities and stockholders’ equity | $956,009 | $890,703 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
In Millions, except Share data, unless otherwise specified | ||
Current assets: | ||
Allowance for doubtful accounts | $1.40 | $2 |
Stockholders’ equity: | ||
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 25,099,293 | 24,459,153 |
Common stock, shares outstanding | 25,070,931 | 24,422,555 |
Treasury stock, shares | 28,362 | 36,598 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations and Comprehensive Income (Loss) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Income Statement [Abstract] | |||
Sales | $687,787 | $663,945 | $646,177 |
Cost of sales | 456,389 | 444,632 | 444,528 |
Gross profit | 231,398 | 219,313 | 201,649 |
Operating expenses: | |||
Selling, general and administrative expenses | 90,602 | 88,107 | 80,992 |
Research, development and engineering costs, net | 49,845 | 54,077 | 52,490 |
Other operating expenses, net | 15,297 | 15,790 | 42,346 |
Total operating expenses | 155,744 | 157,974 | 175,828 |
Operating income | 75,654 | 61,339 | 25,821 |
Interest expense | 4,252 | 11,261 | 18,054 |
(Gain) loss on cost and equity method investments, net | -4,370 | 694 | 106 |
Other (income) expense, net | -807 | 546 | 931 |
Income before provision for income taxes | 76,579 | 48,838 | 6,730 |
Provision for income taxes | 21,121 | 12,571 | 11,529 |
Net income (loss) | 55,458 | 36,267 | -4,799 |
Earnings (loss) per share: | |||
Basic (in dollars per share) | $2.23 | $1.51 | ($0.20) |
Diluted (in dollars per share) | $2.14 | $1.43 | ($0.20) |
Weighted average shares outstanding: | |||
Basic (in shares) | 24,825 | 23,991 | 23,584 |
Diluted (in shares) | 25,975 | 25,323 | 23,584 |
Comprehensive Income (Loss) | |||
Net income (loss) | 55,458 | 36,267 | -4,799 |
Foreign currency translation gain (loss) | -3,502 | 1,521 | 1,905 |
Net change in cash flow hedges, net of tax | -1,359 | -382 | 428 |
Defined benefit plan liability adjustment, net of tax | -374 | 272 | 1,685 |
Other comprehensive income (loss) | -5,235 | 1,411 | 4,018 |
Comprehensive income (loss) | $50,223 | $37,678 | ($781) |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Cash flows from operating activities: | |||
Net income (loss) | $55,458 | $36,267 | ($4,799) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Depreciation and amortization | 37,457 | 35,966 | 46,368 |
Debt related amortization included in interest expense | 773 | 6,366 | 12,557 |
Stock-based compensation | 13,186 | 14,101 | 10,904 |
(Gain) loss on cost and equity method investments, net | -4,370 | 694 | 106 |
Other non-cash (gains) losses, net | -3,214 | 255 | 10,788 |
Deferred income taxes | 531 | -29,856 | 5,733 |
Changes in operating assets and liabilities, net of acquisitions: | |||
Accounts receivable | -11,731 | 7,379 | -18,834 |
Inventories | -6,726 | -11,508 | -7,481 |
Prepaid expenses and other assets | -3,281 | -353 | 1,253 |
Accounts payable | -970 | 1,307 | 5,757 |
Accrued expenses | 1,214 | -1,176 | 1,459 |
Income taxes payable | 2,949 | -2,687 | 1,020 |
Net cash provided by operating activities | 81,276 | 56,755 | 64,831 |
Cash flows from investing activities: | |||
Proceeds from sale of orthopaedic product lines | 2,655 | 4,746 | 0 |
Acquisition of property, plant and equipment | -24,823 | -18,558 | -41,069 |
Proceeds from sale (purchase) of cost and equity method investments, net | 2,248 | -3,732 | -1,887 |
Acquisitions, net of cash acquired | -16,002 | 0 | -17,224 |
Other investing activities, net | 0 | -740 | 393 |
Net cash used in investing activities | -35,922 | -18,284 | -59,787 |
Cash flows from financing activities: | |||
Principal payments of long-term debt | -10,000 | -458,282 | -32,000 |
Proceeds from issuance of long-term debt | 0 | 425,000 | 10,000 |
Issuance of common stock | 8,278 | 12,807 | 1,263 |
Payment of debt issuance costs | 0 | -2,802 | 0 |
Other financing activities, net | -655 | -81 | -717 |
Net cash used in financing activities | -2,377 | -23,358 | -21,454 |
Effect of foreign currency exchange rates on cash and cash equivalents | -1,618 | 68 | 186 |
Net increase (decrease) in cash and cash equivalents | 41,359 | 15,181 | -16,224 |
Cash and cash equivalents, beginning of year | 35,465 | 20,284 | 36,508 |
Cash and cash equivalents, end of year | $76,824 | $35,465 | $20,284 |
Consolidated_Statement_of_Stoc
Consolidated Statement of Stockholders' Equity (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
In Thousands, unless otherwise specified | ||||||
Balance at Dec. 30, 2011 | $467,283 | $23 | $307,196 | ($1,387) | $152,522 | $8,929 |
Balance, shares at Dec. 30, 2011 | 23,466 | -60 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock-based compensation | 9,019 | 9,019 | ||||
Net shares issued under stock incentive plans | 687 | 0 | 663 | 24 | ||
Net shares issued under stock incentive plans, shares | 103 | 1 | ||||
Income tax liability from stock options, restricted stock and restricted stock units | -141 | -141 | ||||
Shares contributed to 401(k) Plan | 4,793 | 1 | 3,881 | 911 | ||
Shares contributed to 401(k) Plan, shares | 163 | 39 | ||||
Net income (loss) | -4,799 | -4,799 | ||||
Total other comprehensive income (loss) | 4,018 | 4,018 | ||||
Balance at Dec. 28, 2012 | 480,860 | 24 | 320,618 | -452 | 147,723 | 12,947 |
Balance, shares at Dec. 28, 2012 | 23,732 | -20 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock-based compensation | 9,333 | 9,333 | ||||
Net shares issued under stock incentive plans | 11,465 | 0 | 12,245 | -780 | ||
Net shares issued under stock incentive plans, shares | 636 | -17 | ||||
Income tax liability from stock options, restricted stock and restricted stock units | 242 | 242 | ||||
Shares contributed to 401(k) Plan | 2,477 | 0 | 2,477 | 0 | ||
Shares contributed to 401(k) Plan, shares | 91 | 0 | ||||
Net income (loss) | 36,267 | 36,267 | ||||
Total other comprehensive income (loss) | 1,411 | 1,411 | ||||
Balance at Jan. 03, 2014 | 542,055 | 24 | 344,915 | -1,232 | 183,990 | 14,358 |
Balance, shares at Jan. 03, 2014 | 24,459 | -37 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock-based compensation | 8,921 | 8,921 | ||||
Net shares issued under stock incentive plans | 3,465 | 1 | 7,754 | -4,290 | ||
Net shares issued under stock incentive plans, shares | 640 | -86 | ||||
Income tax liability from stock options, restricted stock and restricted stock units | 4,357 | 4,357 | ||||
Shares contributed to 401(k) Plan | 4,341 | 0 | 126 | 4,215 | ||
Shares contributed to 401(k) Plan, shares | 0 | 95 | ||||
Net income (loss) | 55,458 | 55,458 | ||||
Total other comprehensive income (loss) | -5,235 | -5,235 | ||||
Balance at Jan. 02, 2015 | $613,362 | $25 | $366,073 | ($1,307) | $239,448 | $9,123 |
Balance, shares at Jan. 02, 2015 | 25,099 | -28 |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 12 Months Ended | ||
Jan. 02, 2015 | |||
Accounting Policies [Abstract] | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
1 | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Principles of Consolidation – The consolidated financial statements include the accounts of Greatbatch, Inc. and its wholly owned subsidiary Greatbatch Ltd. (collectively, the “Company” or “Greatbatch”). All intercompany balances and transactions have been eliminated in consolidation. | |||
Nature of Operations – The Company has two reportable segments: Greatbatch Medical and QiG Group (“QiG”). Greatbatch Medical designs and manufactures products where Greatbatch either owns the intellectual property or has unique manufacturing and assembly expertise. These products include medical devices and components for the cardiac, neuromodulation, orthopaedics, portable medical, vascular and energy markets among others. The Greatbatch Medical segment also offers value-added assembly and design engineering services for medical devices that utilize its component products. | |||
QiG focuses on developing medical device systems for some of healthcare’s most pressing challenges and reflects Greatbatch’s strategic evolution of its product offerings in order to raise the growth and profitability profile of the Company. QiG utilizes a disciplined and diversified portfolio approach with three investor modes: new medical device systems commercialization, collaborative programs with original equipment manufacturers (“OEMs”) customers, and strategic equity positions in emerging healthcare companies. | |||
The Company’s customers include large multi-national OEMs and their affiliated subsidiaries. | |||
Fiscal Year End – The Company utilizes a fifty-two, fifty-three week fiscal year ending on the Friday nearest December 31. Fiscal years 2014, 2013 and 2012 ended on January 2, 2015, January 3, 2014 and December 28, 2012. Fiscal years 2014 and 2012 each contained fifty-two weeks, while fiscal year 2013 contained fifty-three weeks. | |||
Fair Value Measurements – Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e. the “exit price”) in an orderly transaction between market participants at the measurement date. Accounting Standards Codification (“ASC”) establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows: | |||
Level 1 – Valuation is based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Level 1 valuations do not entail a significant degree of judgment. | |||
Level 2 – Valuation is determined from quoted prices for similar assets or liabilities in active markets, quoted prices for identical instruments in markets that are not active or by model-based techniques in which all significant inputs are observable in the market. | |||
Level 3 – Valuation is based on unobservable inputs that are significant to the overall fair value measurement. The degree of judgment in determining fair value is greatest for Level 3 valuations. | |||
The availability of observable inputs can vary and is affected by a wide variety of factors, including, the type of asset/liability, whether the asset/liability is established in the marketplace, and other characteristics particular to the valuation. To the extent that a valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. | |||
Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, assumptions are required to reflect those that market participants would use in pricing the asset or liability at the measurement date. Note 18 “Fair Value Measurements” contains additional information on assets and liabilities recorded at fair value in the consolidated financial statements. | |||
Cash and Cash Equivalents – Cash and cash equivalents consist of cash and highly liquid, short-term investments with maturities at the time of purchase of three months or less. The carrying amount of cash and cash equivalents approximated their fair value as of January 2, 2015 and January 3, 2014 based upon the short-term nature of these instruments. | |||
Concentration of Credit Risk – Financial instruments that potentially subject the Company to concentration of credit risk consist principally of accounts receivable. A significant portion of the Company’s sales and/or accounts receivable are to four customers, all in the medical device industry, and, as such, the Company is directly affected by the condition of those customers and that industry. However, the credit risk associated with trade receivables is partially mitigated due to the stability of those customers. The Company performs on-going credit evaluations of its customers. Note 19 “Business Segment, Geographic and Concentration Risk Information” contains information on sales and accounts receivable for these customers. The Company maintains cash deposits with major banks, which from time to time may exceed insured limits. The Company performs on-going credit evaluations of its banks. | |||
Allowance for Doubtful Accounts – The Company provides credit, in the normal course of business, to its customers in the form of trade receivables. Credit is extended based on evaluation of a customer’s financial condition and collateral is not required. The Company maintains an allowance for those customer receivables that it does not expect to collect. The Company accrues its estimated losses from uncollectable accounts receivable to the allowance based upon recent historical experience, the length of time the receivable has been outstanding and other specific information as it becomes available. Provisions to the allowance for doubtful accounts are charged to current operating expenses. Actual losses are charged against this allowance when incurred. The carrying amount of trade receivables approximated their fair value as of January 2, 2015 based upon the short-term nature of these assets. | |||
Inventories – Inventories are stated at the lower of cost, determined using the first-in first-out method, or market. Write-downs for excess, obsolete or expired inventory are based primarily on how long the inventory has been held as well as estimates of forecasted net sales of that product. A significant change in the timing or level of demand for products may result in recording additional write-downs for excess, obsolete or expired inventory in the future. Note 4 “Inventories” contains additional information on the Company’s inventory. | |||
Property, Plant and Equipment (“PP&E”) – PP&E is carried at cost less accumulated depreciation. Depreciation is computed by the straight-line method over the estimated useful lives of the assets, as follows: buildings and building improvements 7-40 years; machinery and equipment 3-8 years; office equipment 3-10 years; and leasehold improvements over the remaining lives of the improvements or the lease term, if less. The cost of repairs and maintenance are expensed as incurred; renewals and betterments are capitalized. Upon retirement or sale of an asset, its cost and related accumulated depreciation or amortization is removed from the accounts and any gain or loss is recorded in operating income or expense. Note 6 “Property, Plant and Equipment, Net” contains additional information on the Company’s PP&E. | |||
Business Combinations – The Company records its business combinations under the acquisition method of accounting. Under the acquisition method of accounting, the Company allocates the purchase price of each acquisition to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective fair values at the date of acquisition. The fair value of identifiable intangible assets is based upon detailed valuations that use various assumptions made by management. Any excess of the purchase price over the fair value of net tangible and identifiable intangible assets acquired is allocated to goodwill. All direct acquisition-related costs are expensed as incurred. | |||
In circumstances where an acquisition involves a contingent consideration arrangement, the Company recognizes a liability equal to the fair value of the contingent payments it expects to make as of the acquisition date. The Company re-measures this liability each reporting period and records changes in the fair value through Other Operating Expenses, Net. Increases or decreases in the fair value of the contingent consideration liability can result from changes in discount periods and rates, as well as changes in the timing, amount of, or the likelihood of achieving the applicable contingent consideration. See Note 18 “Fair Value Measurements” and Note 2 “Acquisitions” for additional information on the Company’s contingent consideration and acquisitions, respectively. | |||
Amortizing Intangible Assets – Amortizing intangible assets consists primarily of purchased technology, patents and customer lists. The Company amortizes its definite-lived intangible assets over their estimated useful lives utilizing an accelerated or straight-line method of amortization, which approximates the projected cash flows used to fair value those intangible assets at the time of acquisition. When the straight-line method of amortization is utilized, the estimated useful life of the intangible asset is shortened to assure that recognition of amortization expense corresponds with the expected cash flows. The amortization period for the Company’s amortizing intangible assets are as follows: purchased technology and patents 5-15 years; customer lists 7-20 years and other intangible assets 1-10 years. See Note 7 “Intangible Assets” for additional information on the Company’s amortizing intangible assets. | |||
Impairment of Long-Lived Assets – The Company assesses the impairment of definite-lived long-lived assets or asset groups when events or changes in circumstances indicate that the carrying value may not be recoverable. Factors that are considered in deciding when to perform an impairment review include: a significant decrease in the market price of the asset or asset group; a significant change in the extent or manner in which a long-lived asset or asset group is being used or in its physical condition; a significant change in legal factors or in the business climate that could affect the value of a long-lived asset or asset group, including an action or assessment by a regulator; an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction; a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset or asset group; or a current expectation that, more likely than not, a long-lived asset or asset group will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. The term more likely than not refers to a level of likelihood that is more than 50 percent. | |||
Potential recoverability is measured by comparing the carrying amount of the asset or asset group to its related total future undiscounted cash flows. If the carrying value is not recoverable, the asset or asset group is considered to be impaired. Impairment is measured by comparing the asset or asset group’s carrying amount to its fair value. When it is determined that useful lives of assets are shorter than originally estimated, and no impairment is present, the rate of depreciation is accelerated in order to fully depreciate the assets over their new shorter useful lives. | |||
Goodwill and other indefinite lived intangible assets recorded are not amortized but are periodically tested for impairment. The Company assesses goodwill for impairment on the last day of each fiscal year, or more frequently if certain events occur as described above. Goodwill is evaluated for impairment through the comparison of the fair value of the reporting units to their carrying values. When evaluating goodwill for impairment, the Company may first perform an assessment of qualitative factors to determine if the fair value of the reporting unit is more-likely-than-not greater than its carrying amount. This qualitative assessment is referred to as a “step zero” approach. If, based on the review of the qualitative factors, the Company determines it is more-likely-than-not that the fair value of the reporting unit is greater than its carrying value, the required two-step impairment test can be bypassed. If the Company does not perform a step zero assessment or if the fair value of the reporting unit is more-likely-than-not less than its carrying value, the Company must perform a two-step impairment test, and calculate the estimated fair value of the reporting unit. If, based upon the two-step impairment test, it is determined that the fair value of a reporting unit is less than its carrying value, an impairment loss is recorded to the extent that the implied fair value of the goodwill within the reporting unit is less than its carrying value. Under the two-step approach, fair values for reporting units are determined based on discounted cash flows and market multiples. | |||
The Company completed its annual goodwill impairment assessment for 2014 by performing a step zero qualitative analysis. As part of this analysis, the Company evaluated factors including, but not limited to, macro-economic conditions, market and industry conditions, cost factors, competitive environment, share price fluctuations, results of the last impairment test, and the operational stability and the overall financial performance of the reporting units. After completing the analysis, the Company determined that it was more likely than not that its reporting units fair values are greater than the reporting units carrying values and the two-step impairment test is not necessary. | |||
Other indefinite lived intangible assets are assessed for impairment on the last day of each fiscal year, or more frequently if certain events occur as described above, by comparing the fair value of the intangible asset to its carrying value. The fair value is determined by using the income approach. Note 7 “Intangible Assets” contains additional information on the Company’s long-lived intangible assets. | |||
Other Long-Term Assets – Other long-term assets includes deferred financing fees incurred in connection with the Company’s issuance of its long-term debt. The fees relating to the Company’s Term Loan are amortized to Interest Expense using the effective interest method over the period from the date of issuance to the put option date (if applicable) or the maturity date, whichever is earlier. Fees relating to the Company’s Revolving Credit Facility are amortized to Interest Expense on a straight-line basis over the contractual term of the credit facility. The amortization of deferred fees is included in Debt Related Amortization Included in Interest Expense in the Consolidated Statements of Cash Flows. Note 9 “Debt” contains additional information on the Company’s deferred financing fees. | |||
Other long-term assets also include investments in equity securities of entities that are not publicly traded and which do not have readily determinable fair values. The Company accounts for investments in these entities under the cost or equity method depending on the type of ownership interest, as well as the Company’s ability to exercise influence over these entities. Equity method investments are initially recorded at cost, and are subsequently adjusted to reflect the Company’s share of earnings or losses of the investee. Cost method investments are recorded at cost. Each reporting period, management evaluates these cost and equity method investments to determine if there are any events or circumstances that are likely to have a significant effect on the fair value of the investment. Examples of such impairment indicators include, but are not limited to: a recent sale or offering of similar shares of the investment at a price below the Company’s cost basis; a significant deterioration in earnings performance; a significant change in the regulatory, economic or technological environment of the investee; or a significant doubt about an investee’s ability to continue as a going concern. If an impairment indicator is identified, management will estimate the fair value of the investment and compare it to its carrying value. The estimation of fair value considers all available financial information related to the investee, including, but not limited to, valuations based on recent third-party equity investments in the investee. If the fair value of the investment is less than its carrying value, the investment is impaired and a determination as to whether the impairment is other-than-temporary is made. Impairment is deemed to be other-than-temporary unless the Company has the ability and intent to hold the investment for a period sufficient for a market recovery up to the carrying value of the investment. Further, evidence must indicate that the carrying value of the investment is recoverable within a reasonable period. For other-than-temporary impairments, an impairment loss is recognized equal to the difference between the investment’s carrying value and its fair value. The Company has determined that these investments are not considered variable interest entities. The Company’s exposure related to these entities is limited to its recorded investment. These investments are in start-up research and development companies whose fair value is highly subjective in nature and subject to future fluctuations, which could be significant. | |||
Income Taxes – The consolidated financial statements of the Company have been prepared using the asset and liability approach in accounting for income taxes, which requires the recognition of deferred income taxes for the expected future tax consequences of net operating losses, credits, and temporary differences between the financial statement carrying amounts and the tax bases of assets and liabilities. A valuation allowance is provided on deferred tax assets if it is determined that it is more likely than not that the asset will not be realized. | |||
The Company accounts for uncertain tax positions using a more likely than not recognition threshold. The evaluation of uncertain tax positions is based on factors including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective settlement of matters subject to audit, new audit activity and changes in facts or circumstances related to a tax position. These tax positions are evaluated on a quarterly basis. The Company recognizes interest expense related to uncertain tax positions as Provision for Income Taxes. Penalties, if incurred, are recognized as a component of Selling, General and Administrative Expenses (“SG&A”). | |||
The Company and its subsidiary file a consolidated U.S. federal income tax return. State tax returns are filed on a combined or separate basis depending on the applicable laws in the jurisdictions where tax returns are filed. The Company also files foreign tax returns on a separate company basis in the countries in which it operates. See Note 14 “Income Taxes” for additional information. | |||
Convertible Subordinated Notes (“CSN”) – For convertible debt instruments that may be settled in cash upon conversion, the Company accounts for the liability and equity components of those instruments in a manner that will reflect the entity’s nonconvertible debt borrowing rate when interest cost is recognized in subsequent periods. | |||
Upon issuance, the Company determined the carrying amount of the liability component of CSN by measuring the fair value of a similar liability that does not have the associated conversion option. The carrying amount of the conversion option was then determined by deducting the fair value of the liability component from the initial proceeds received from the issuance of CSN. The carrying amount of the conversion option was recorded in Additional Paid-In Capital with an offset to Long-Term Debt and was amortized using the effective interest method over the period from the date of issuance to the maturity date. The amortization of discount related to the Company’s convertible debt instruments is included in Debt Related Amortization Included in Interest Expense in the Consolidated Statements of Cash Flows. See Note 9 “Debt” for additional information. | |||
Derivative Financial Instruments – The Company recognizes all derivative financial instruments in its consolidated financial statements at fair value. Changes in the fair value of derivative instruments are recorded in earnings unless hedge accounting criteria are met. The Company designates its interest rate swaps (See Note 9 “Debt”) and foreign currency contracts (See Note 15 “Commitments and Contingencies”) entered into as cash flow hedges. The effective portion of the changes in fair value of these cash flow hedges is recorded each period, net of tax, in Accumulated Other Comprehensive Income until the related hedged transaction occurs. Any ineffective portion of the changes in fair value of these cash flow hedges is recorded in earnings. In the event the hedged cash flow for forecasted transactions does not occur, or it becomes probable that they will not occur, the Company would reclassify the amount of any gain or loss on the related cash flow hedge to income (expense) at that time. Cash flows related to these derivative financial instruments are included in cash flows from operating activities. | |||
Revenue Recognition – The Company recognizes revenue when it is realized or realizable and earned. This occurs when persuasive evidence of an arrangement exists, delivery has occurred, the price is fixed or determinable (including any price concessions under long-term agreements), the buyer is obligated to pay us (i.e., not contingent on a future event), the risk of loss is transferred, there is no obligation of future performance, collectability is reasonably assured and the amount of future returns can reasonably be estimated. With regards to the Company’s customers (including distributors), those criteria are met at the time of shipment when title passes. Currently, the revenue recognition policy is the same for both Greatbatch Medical and QiG. In general, for customers with long-term contracts, we have negotiated fixed pricing arrangements. During new contract negotiations, price level decreases (concessions) for future sales may be offered to customers in exchange for volume and/or long-term commitments. Once the new contracts are signed, these prices are fixed and determinable for all future sales. The Company includes shipping and handling fees billed to customers in Sales. Shipping and handling costs associated with inbound and outbound freight are recorded in Cost of Sales. In certain instances the Company obtains component parts for sub-assemblies from its customers that are included in the final product sold back to the same customer. These amounts are excluded from Sales and Cost of Sales recognized by the Company. The cost of these customer supplied component parts amounted to $48.1 million, $45.3 million and $32.6 million in 2014, 2013 and 2012, respectively. | |||
Product Warranties – The Company allows customers to return defective or damaged products for credit, replacement, or exchange. The Company warrants that its products will meet customer specifications and will be free from defects in materials and workmanship. The Company accrues its estimated exposure to warranty claims, through Cost of Sales, based upon recent historical experience and other specific information as it becomes available. Note 15 “Commitments and Contingencies” contains additional information on the Company’s product warranties. | |||
Research, Development and Engineering Costs, Net (“RD&E”) – RD&E costs are expensed as incurred. The primary costs are salary and benefits for personnel, material costs used in development projects and subcontracting costs. Cost reimbursements for engineering services from customers for whom the Company designs products are recorded as an offset to engineering costs upon achieving development milestones specified in the contracts. These reimbursements do not cover the complete cost of the development projects. Additionally, the technology developed under these cost reimbursement projects is owned by the Company and is utilized for future products developed for other customers. | |||
In-process research and development (“IPR&D”) represents research projects acquired in a business combination which are expected to generate cash flows but have not yet reached technological feasibility. The primary basis for determining the technological feasibility of these projects is whether or not regulatory approval has been obtained. The Company classifies IPR&D acquired in a business combination as an indefinite-lived intangible asset until the completion or abandonment of the associated projects. Upon completion, the Company would determine the useful life of the IPR&D and begin amortizing the assets to reflect their use over their remaining lives. Upon permanent abandonment, the remaining carrying amount of the associated IPR&D would be written-off. The Company tests the IPR&D acquired for impairment at least annually, and more frequently if events or changes in circumstances indicate that the assets may be impaired. The impairment test consists of a comparison of the fair value of the intangible assets with their carrying amount. If the carrying amount exceeds its fair value, the Company would record an impairment loss in an amount equal to the excess. | |||
Note 12 “Research, Development and Engineering Costs, Net” contains additional information on the Company’s RD&E activities. | |||
Stock-Based Compensation – The Company records compensation costs related to stock-based awards granted to employees based upon their estimated fair value on the grant date. Compensation cost for service-based awards is recognized ratably over the applicable vesting period. Compensation cost for nonmarket-based performance awards is reassessed each period and recognized based upon the probability that the performance targets will be achieved. Compensation cost for market-based performance awards is expensed ratably over the applicable vesting period and is recognized each period whether the performance metrics are achieved or not. | |||
The Company utilizes the Black-Scholes option pricing model to estimate the fair value of stock options granted. For service-based and nonmarket-based performance restricted stock and restricted stock unit awards, the fair market value of the award is determined based upon the closing value of the Company’s stock price on the grant date. For market-based performance restricted stock unit awards, the fair market value of the award is determined utilizing a Monte Carlo simulation model, which projects the value of the Company’s stock under numerous scenarios and determines the value of the award based upon the present value of those projected outcomes. | |||
The amount of stock-based compensation expense recognized is based on the portion of the awards that are ultimately expected to vest. The Company estimates pre-vesting forfeitures at the time of grant by analyzing historical data and revises those estimates in subsequent periods if actual forfeitures differ from those estimates. The total expense recognized over the vesting period will only be for those awards that ultimately vest, excluding market and nonmarket performance award considerations. Note 11 “Stock-Based Compensation” contains additional information on the Company’s stock-based compensation. | |||
Foreign Currency Translation – The Company translates all assets and liabilities of its foreign subsidiaries, where the U.S. dollar is not the functional currency, at the period-end exchange rate and translates income and expenses at the average exchange rates in effect during the period. The net effect of this translation is recorded in the consolidated financial statements as Accumulated Other Comprehensive Income. Translation adjustments are not adjusted for income taxes as they relate to permanent investments in the Company’s foreign subsidiaries. | |||
Net foreign currency transaction gains and losses are included in Other (Income) Expense, Net and amounted to a gain of $1.3 million for 2014, a loss of $0.1 million for 2013 and a loss of $0.3 million for 2012. | |||
Defined Benefit Plans – The Company recognizes in its balance sheet as an asset or liability the overfunded or underfunded status of its defined benefit plans provided to its employees located in Mexico, Switzerland and France. This asset or liability is measured as the difference between the fair value of plan assets and the benefit obligation of those plans. For these plans, the benefit obligation is the projected benefit obligation, which is calculated based on actuarial computations of current and future benefits for employees. Actuarial gains or losses and prior service costs or credits that arise during the period, but are not included as components of net periodic benefit expense, are recognized as a component of Accumulated Other Comprehensive Income. Defined benefit expenses are charged to Cost of Sales, SG&A and RD&E expenses as applicable. Note 10 “Benefit Plans” contains additional information on these costs. | |||
Earnings (Loss) Per Share (“EPS”) – Basic EPS is calculated by dividing Net Income (Loss) by the weighted average number of shares outstanding during the period. Diluted EPS is calculated by adjusting the weighted average number of shares outstanding for potential common shares, which consist of stock options, unvested restricted stock and restricted stock units and, if applicable, contingently convertible instruments such as convertible debt. Note 16 “Earnings (Loss) Per Share” contains additional information on the computation of the Company’s EPS. | |||
Comprehensive Income (Loss) – The Company’s comprehensive income (loss) as reported in the Consolidated Statements of Operations and Comprehensive Income (Loss) includes net income (loss), foreign currency translation adjustments, the net change in cash flow hedges, and defined benefit plan liability adjustments. The Consolidated Statements of Operations and Comprehensive Income (Loss) and Note 17 “Accumulated Other Comprehensive Income” contains additional information on the computation of the Company’s comprehensive income (loss). | |||
Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of sales and expenses during the reporting period. Actual results could differ materially from those estimates. | |||
Recently Issued Accounting Pronouncements – In the normal course of business, management evaluates all new accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”), Securities and Exchange Commission (“SEC”), Emerging Issues Task Force (“EITF”), or other authoritative accounting bodies to determine the potential impact they may have on the Company’s Consolidated Financial Statements. Based upon this review, except as noted below, management does not expect any of the recently issued accounting pronouncements, which have not already been adopted, to have a material impact on the Company’s Consolidated Financial Statements. | |||
In November 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-17, “Business Combinations (Topic 805): Pushdown Accounting (a Consensus of the FASB Emerging Issues Task Force).” The amendments in this ASU provide an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. An acquired entity may elect the option to apply pushdown accounting in the reporting period in which the change-in-control event occurs. The amendments in this ASU are effective on November 18, 2014. After the effective date, an acquired entity can make an election to apply the guidance to future change-in-control events or to its most recent change-in-control event. This ASU did not impact the Company’s Consolidated Financial Statements. | |||
In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers.” The core principle behind ASU 2014-09 is that an entity should recognize revenue in an amount that reflects the consideration to which the entity expects to be entitled in exchange for delivering goods and services. This model involves a five-step process that includes identifying the contract with the customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations in the contract and recognizing revenue when the entity satisfies the performance obligations. This ASU supersedes existing revenue recognition guidance and is effective for annual reporting periods beginning after December 15, 2016 with early application not permitted. This ASU allows two methods of adoption; a full retrospective approach where three years of financial information are presented in accordance with the new standard, and a modified retrospective approach where this ASU is applied to the most current period presented in the financial statements. The Company is currently assessing the financial impact of adopting the new standard and the methods of adoption; however, given the scope of the new standard, the Company is currently unable to provide a reasonable estimate regarding the financial impact or which method of adoption will be elected. | |||
In April 2014, the FASB issued ASU No. 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,” which amends the definition of a discontinued operation and requires entities to provide additional disclosures about disposal transactions that do not meet the discontinued operations criteria. The revised guidance changes how entities identify and disclose information about disposal transactions under U.S. GAAP. This ASU is effective prospectively for all disposals (except disposals classified as held for sale before the adoption date) or components initially classified as held for sale in periods beginning on or after December 15, 2014, with early adoption permitted. This ASU will be applicable for disposal transactions, if any, that the Company enters into after the adoption date. | |||
In July 2013, the FASB issued ASU No. 2013-11, “Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” This ASU requires that entities present an unrecognized tax benefit, or portion of an unrecognized tax benefit, as a reduction to a deferred tax asset in the financial statements for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, with certain exceptions. This ASU was adopted during the first quarter of 2014 and did not impact the Company’s Consolidated Financial Statements as the Company does not have any net operating loss carryforward deferred tax assets that are eligible to be reduced by an unrecognized tax benefit as required by the ASU. |
Acquisitions
Acquisitions | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Business Combinations [Abstract] | ||||||||||||
ACQUISITIONS | ||||||||||||
2 | ACQUISITIONS | |||||||||||
Centro de Construcción de Cardioestimuladores del Uruguay | ||||||||||||
On August 12, 2014 the Company purchased all of the outstanding common stock of Centro de Construcción de Cardioestimuladores del Uruguay (“CCC”), headquartered in Montevideo, Uruguay. CCC is an active implantable neuromodulation medical device systems developer and manufacturer that produces a range of medical devices including implantable pulse generators, programmer systems, battery chargers, patient wands and leads. This acquisition allows the Company to more broadly partner with medical device companies, complements the Company’s core discrete technology offerings and enhances the Company’s medical device innovation efforts. | ||||||||||||
This transaction was accounted for under the acquisition method of accounting. Accordingly, the operating results of CCC have been included in the Company’s QiG segment from the date of acquisition. For 2014, CCC added approximately $5.8 million to the Company’s revenue and increased the Company’s net income by $1.2 million. The aggregate purchase price of $19.8 million was funded with cash on hand. | ||||||||||||
The cost of the acquisition was preliminarily allocated to the assets acquired and liabilities assumed from CCC based on their fair values as of the closing date of the acquisition, with the amount exceeding the fair value of the net assets acquired being recorded as goodwill. The value assigned to certain assets and liabilities are preliminary and are subject to adjustment as additional information is obtained, including, but not limited to, the finalization of pre-acquisition tax positions. The valuation is expected to be finalized in 2015. When the valuation is finalized, any changes to the preliminary valuation of assets acquired or liabilities assumed may result in material adjustments to the fair value of the intangible assets acquired, as well as goodwill. | ||||||||||||
The following table summarizes the preliminary allocation of the CCC purchase price to the assets acquired and liabilities assumed as of the acquisition date (in thousands): | ||||||||||||
Assets acquired | ||||||||||||
Current assets | $ | 10,670 | ||||||||||
Property, plant and equipment | 1,131 | |||||||||||
Amortizing intangible assets | 6,100 | |||||||||||
Goodwill | 8,296 | |||||||||||
Total assets acquired | 26,197 | |||||||||||
Liabilities assumed | ||||||||||||
Current liabilities | 4,842 | |||||||||||
Deferred income taxes | 1,590 | |||||||||||
Total liabilities assumed | 6,432 | |||||||||||
Net assets acquired | $ | 19,765 | ||||||||||
The preliminary fair values of the assets acquired were determined using one of three valuation approaches: market, income or cost. The selection of a particular method for a given asset depended on the reliability of available data and the nature of the asset, among other considerations. | ||||||||||||
The market approach estimates the value for a subject asset based on available market pricing for comparable assets. The income approach estimates the value for a subject asset based on the present value of cash flows projected to be generated by the asset. The projected cash flows were discounted at a required rate of return that reflects the relative risk of the asset and the time value of money. The projected cash flows for each asset considered multiple factors from the perspective of a marketplace participant including revenue projections from existing customers, attrition trends, technology life-cycle assumptions, marginal tax rates and expected profit margins giving consideration to historical and expected margins. The cost approach estimates the value for a subject asset based on the cost to replace the asset and reflects the estimated reproduction or replacement cost for the asset, less an allowance for loss in value due to depreciation or obsolescence, with specific consideration given to economic obsolescence if indicated. These fair value measurement approaches are based on significant unobservable inputs, including management estimates and assumptions. | ||||||||||||
Current assets and liabilities – The fair value of current assets and liabilities, excluding inventory, was assumed to approximate their carrying value as of the acquisition date due to the short-term nature of these assets and liabilities. | ||||||||||||
The fair value of in-process and finished goods inventory acquired was estimated by applying a version of the market approach called the comparable sales method. This approach estimates the fair value of the assets by calculating the potential revenue generated from selling the inventory and subtracting from it the costs related to the completion and sale of that inventory and a reasonable profit allowance. Based upon this methodology, the Company recorded the inventory acquired at fair value resulting in an increase in inventory of $0.3 million. | ||||||||||||
Intangible assets – The purchase price was allocated to intangible assets as follows (dollars in thousands): | ||||||||||||
Amortizing Intangible Assets | Fair | Weighted | Weighted | |||||||||
Value | Average | Average | ||||||||||
Assigned | Amortization | Discount | ||||||||||
Period (Years) | Rate | |||||||||||
Technology | $ | 1,400 | 10 | 18% | ||||||||
Customer lists | 4,600 | 10 | 18% | |||||||||
Trademarks and tradenames | 100 | 2 | 18% | |||||||||
$ | 6,100 | 10 | 18% | |||||||||
Technology – Technology consists of technical processes, unpatented technology, manufacturing know-how, trade secrets and the understanding with respect to products or processes that have been developed by CCC and that will be leveraged in current and future products. The fair value of technology acquired was determined utilizing the relief from royalty method, a form of the income approach, with a royalty rate of 3%. The weighted average amortization period of the technology is based upon management’s estimate of the product life cycle associated with technology before they will be replaced by new technologies. | ||||||||||||
Customer lists – Customer lists represent the estimated fair value of non-contractual customer relationships CCC has as of the acquisition date. The primary customers of CCC include medical device companies in various geographic locations around the world. These relationships were valued separately from goodwill at the amount that an independent third party would be willing to pay for these relationships. The fair value of customer lists was determined using the multi-period excess-earnings method, a form of the income approach. The weighted average amortization period of the existing customer base was based upon the historical customer annual attrition rate of 15%, as well as management’s understanding of the industry and product life cycles. | ||||||||||||
Trademarks and tradenames – Trademarks and tradenames represent the estimated fair value of corporate and product names acquired from CCC. These tradenames were valued separately from goodwill at the amount that an independent third party would be willing to pay for use of these names. The fair value of the trademarks and tradenames was determined by utilizing the relief from royalty method, a form of the income approach, with a 0.5% royalty rate. | ||||||||||||
Goodwill – The excess of the purchase price over the fair value of net tangible and intangible assets acquired and liabilities assumed was allocated to goodwill. Various factors contributed to the establishment of goodwill, including: the value of CCC’s highly trained assembled work force and management team; the incremental value that CCC’s technology will bring to QiG’s medical devices; and the expected revenue growth over time that is attributable to increased market penetration from future products and customers. The goodwill acquired in connection with the CCC acquisition was allocated to the QiG business segment and is not deductible for tax purposes. | ||||||||||||
NeuroNexus Technologies, Inc. | ||||||||||||
On February 16, 2012, the Company purchased all of the outstanding common stock of NeuroNexus Technologies, Inc. (“NeuroNexus”) headquartered in Ann Arbor, MI. NeuroNexus is an active implantable medical device design firm specializing in developing and commercializing neural interface technology, components and systems for neuroscience and clinical markets. NeuroNexus has an extensive intellectual property portfolio, core technologies and capabilities to support the development and manufacturing of neural interface devices across a wide range of applications including neuromodulation, sensing, optical stimulation and targeted drug delivery. | ||||||||||||
This transaction was accounted for under the acquisition method of accounting. Accordingly, the operating results of NeuroNexus have been included in the Company’s QiG segment from the date of acquisition. For 2012, NeuroNexus added approximately $2.5 million to the Company’s revenue and decreased the Company’s net loss by $0.2 million. The purchase price of NeuroNexus consisted of cash payments of $11.7 million and potential future payments of up to an additional $2 million. These future payments were contingent upon the achievement of certain financial and development-based milestones and had an estimated fair value of $1.5 million as of the acquisition date. | ||||||||||||
The cost of the acquisition was allocated to the assets acquired and liabilities assumed from NeuroNexus based on their fair values as of the close of the acquisition, with the amount exceeding the fair value of the net assets acquired being recorded as goodwill. The valuation of the assets acquired and liabilities assumed from NeuroNexus was finalized during 2013 and did not result in a material adjustment to the original valuation of net assets acquired, including goodwill and therefore was not reflected as a retrospective adjustment of the historical financial statements. | ||||||||||||
The following table summarizes the allocation of the NeuroNexus purchase price to the assets acquired and liabilities assumed as of the acquisition date (in thousands): | ||||||||||||
Assets acquired | ||||||||||||
Current assets | $ | 618 | ||||||||||
Property, plant and equipment | 35 | |||||||||||
Amortizing intangible assets | 2,927 | |||||||||||
Indefinite-lived intangible assets | 540 | |||||||||||
Goodwill | 8,924 | |||||||||||
Other assets | 1,576 | |||||||||||
Total assets acquired | 14,620 | |||||||||||
Liabilities assumed | ||||||||||||
Current liabilities | 420 | |||||||||||
Deferred income taxes | 989 | |||||||||||
Total liabilities assumed | 1,409 | |||||||||||
Net assets acquired | $ | 13,211 | ||||||||||
The fair values of the assets acquired were determined using one of three valuation approaches: market, income and cost. The selection of a particular method for a given asset depended on the reliability of available data and the nature of the asset, among other considerations. | ||||||||||||
Current assets and liabilities – The fair value of current assets and liabilities was assumed to approximate their carrying value as of the acquisition date due to the short-term nature of these assets and liabilities. | ||||||||||||
Intangible assets – The purchase price was allocated to identifiable intangible assets as follows (dollars in thousands): | ||||||||||||
Fair | Weighted | Estimated | Weighted | |||||||||
Value | Average | Useful | Average | |||||||||
Assigned | Amortization | Life (Years) | Discount | |||||||||
Period (Years) | Rate | |||||||||||
Amortizing Intangible Assets | ||||||||||||
Technology and patents | $ | 1,058 | 6 | 10 | 14 | % | ||||||
Customer lists | 1,869 | 7 | 15 | 13 | % | |||||||
$ | 2,927 | 7 | 13 | 13 | % | |||||||
Indefinite-lived Intangible Assets | ||||||||||||
In-process research and development | $ | 540 | N/A | 12 | 26 | % | ||||||
The weighted average amortization period is less than the estimated useful life due to the Company using an accelerated amortization method, which approximates the projected cash flows used to determine the fair value of those intangible assets. | ||||||||||||
Technology and patents – Technology and patents consists of technical processes, patented and unpatented technology, manufacturing know-how, trade secrets and the understanding with respect to products or processes that have been developed by NeuroNexus and that will be leveraged in current and future products. The fair value of technology and patents acquired was determined utilizing the relief from royalty method, a form of the income approach, with royalty rates that ranged from 2% to 6%. The estimated useful life of the technology and patents is based upon management’s estimate of the product life cycle associated with technology and patents before they will be replaced by new technologies. | ||||||||||||
Customer lists – Customer lists represent the estimated fair value of non-contractual customer relationships NeuroNexus has as of the acquisition date. The primary customers of NeuroNexus include numerous scientists and researchers from various geographic locations around the world. These relationships were valued separately from goodwill at the amount which an independent third party would be willing to pay for these relationships. The fair value of customer lists was determined using the multi-period excess-earnings method, a form of the income approach. The estimated useful life of the existing customer list was based upon historical customer attrition as well as management’s understanding of the industry and product life cycles. | ||||||||||||
IPR&D – IPR&D represents research projects which are expected to generate cash flows but have not yet reached technological feasibility. The Company used the income approach to determine the fair value of the IPR&D acquired. In arriving at the value of the IPR&D, management considered, among other factors: the projects’ stage of completion; the complexity of the work to be completed as of the acquisition date; the projected costs to complete the projects; the contribution of other acquired assets; and the estimated useful life of the technology. The Company applied a market-participant risk-adjusted discount rate to arrive at a present value as of the date of acquisition. The value assigned to IPR&D related to the development of micro-electrodes for deep brain mapping and electrocorticography. For purposes of valuing the IPR&D, the Company estimated total costs to complete the projects to be approximately $1.5 million. | ||||||||||||
Goodwill – The excess of the purchase price over the fair value of net tangible and intangible assets acquired and liabilities assumed was allocated to goodwill. Various factors contributed to the establishment of goodwill, including: the value of NeuroNexus’s highly trained assembled work force and management team; the incremental value that NeuroNexus’s technology will bring to the Company’s neuromodulation platform currently in development; and the expected revenue growth over time that is attributable to increased market penetration from future products and customers. The goodwill acquired in connection with the NeuroNexus acquisition was allocated to the QiG business segment and is not deductible for tax purposes. | ||||||||||||
Pro Forma Results (Unaudited) – The following unaudited pro forma information presents the consolidated results of operations of the Company, CCC, and NeuroNexus as if those acquisitions occurred as of the beginning of fiscal years 2013 (CCC) and 2011 (NeuroNexus) (in thousands, except per share amounts): | ||||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Sales | $ | 696,357 | $ | 677,657 | $ | 646,617 | ||||||
Net income (loss) | 56,453 | 37,612 | (4,973 | ) | ||||||||
Earnings (loss) per share: | ||||||||||||
Basic | $ | 2.27 | $ | 1.57 | $ | (0.21 | ) | |||||
Diluted | $ | 2.17 | $ | 1.49 | $ | (0.21 | ) | |||||
The unaudited pro forma information presents the combined operating results of Greatbatch, CCC, and NeuroNexus, with the results prior to the acquisition date adjusted to include the pro forma impact of the amortization of acquired intangible assets, the adjustment to interest expense reflecting the amount borrowed in connection with the acquisitions at Greatbatch’s interest rate, and the impact of income taxes on the pro forma adjustments utilizing the applicable statutory tax rate. The unaudited pro forma consolidated basic and diluted earnings (loss) per share calculations are based on the consolidated basic and diluted weighted average shares of Greatbatch. The unaudited pro forma results are presented for illustrative purposes only and do not reflect the realization of potential cost savings, and any related integration costs. Certain costs savings may result from the acquisition; however, there can be no assurance that these cost savings will be achieved. These pro forma results do not purport to be indicative of the results that would have been obtained, or to be a projection of results that may be obtained in the future. |
Supplemental_Cash_Flow_Informa
Supplemental Cash Flow Information | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Supplemental Cash Flow Elements [Abstract] | ||||||||||||
SUPPLEMENTAL CASH FLOW INFORMATION | ||||||||||||
3 | SUPPLEMENTAL CASH FLOW INFORMATION | |||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
(in thousands) | ||||||||||||
Noncash investing and financing activities: | ||||||||||||
Common stock contributed to 401(k) Plan | $ | 4,341 | $ | 2,477 | $ | 4,793 | ||||||
Property, plant and equipment purchases included in accounts payable | 2,926 | 2,103 | 2,522 | |||||||||
Cash paid during the year for: | ||||||||||||
Interest | 3,521 | 4,989 | 6,230 | |||||||||
Income taxes | 13,565 | 44,165 | 4,909 | |||||||||
Acquisition of noncash assets | 22,434 | — | 14,396 | |||||||||
Liabilities assumed | 6,432 | — | 1,244 | |||||||||
Inventories
Inventories | 12 Months Ended | |||||||
Jan. 02, 2015 | ||||||||
Inventory Disclosure [Abstract] | ||||||||
INVENTORIES | ||||||||
4 | INVENTORIES | |||||||
Inventories are comprised of the following (in thousands): | ||||||||
At | ||||||||
January 2, | January 3, | |||||||
2015 | 2014 | |||||||
Raw materials | $ | 73,354 | $ | 67,939 | ||||
Work-in-process | 38,930 | 36,670 | ||||||
Finished goods | 16,958 | 13,749 | ||||||
Total | $ | 129,242 | $ | 118,358 | ||||
Assets_Held_For_Sale
Assets Held For Sale | 12 Months Ended | ||||||||||
Jan. 02, 2015 | |||||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||||
ASSETS HELD FOR SALE | |||||||||||
5 | ASSETS HELD FOR SALE | ||||||||||
Assets held for sale included in Prepaid Expenses and Other Current Assets, is comprised of the following (in thousands): | |||||||||||
At | |||||||||||
Asset | Business | January 2, | January 3, | ||||||||
Segment | 2015 | 2014 | |||||||||
Building and building improvements | Greatbatch Medical | $ | 1,635 | $ | — | ||||||
During 2014, the Company transferred $2.1 million of assets relating to the Company’s Orvin, Switzerland property to held for sale and recognized a $0.4 million impairment charge that was recorded in Other Operating Expenses, Net. See Note 13 “Other Operating Expenses, Net,” for additional information regarding this transaction and Note 18 “Fair Value Measurements,” for information regarding the fair value of the assets. |
Property_Plant_and_Equipment_N
Property, Plant and Equipment, Net | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Property, Plant and Equipment [Abstract] | ||||||||||||
PROPERTY, PLANT AND EQUIPMENT, NET | ||||||||||||
6 | PROPERTY, PLANT AND EQUIPMENT, NET | |||||||||||
Property, plant and equipment are comprised of the following (in thousands): | ||||||||||||
At | ||||||||||||
January 2, | January 3, | |||||||||||
2015 | 2014 | |||||||||||
Manufacturing machinery and equipment | $ | 167,173 | $ | 159,542 | ||||||||
Buildings and building improvements | 89,258 | 87,359 | ||||||||||
Information technology hardware and software | 31,725 | 28,010 | ||||||||||
Leasehold improvements | 31,170 | 31,522 | ||||||||||
Furniture and fixtures | 14,045 | 13,889 | ||||||||||
Land and land improvements | 10,816 | 13,016 | ||||||||||
Construction work in process | 14,129 | 7,886 | ||||||||||
Other | 629 | 633 | ||||||||||
358,945 | 341,857 | |||||||||||
Accumulated depreciation | (214,020 | ) | (196,084 | ) | ||||||||
Total | $ | 144,925 | $ | 145,773 | ||||||||
Depreciation expense for property, plant and equipment was as follows (in thousands): | ||||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Depreciation expense | $ | 23,320 | $ | 22,799 | $ | 31,575 | ||||||
Construction work in process at January 2, 2015 primarily relates to the Company’s 2014 investment in capacity and capabilities initiative. See Note 13 “Other Operating Expenses, Net” for a description of the Company’s significant capital investment projects. Construction work in process at January 3, 2014 primarily relates to routine purchases of machinery, equipment, and information technology assets to support normal recurring operations. |
Intangible_Assets
Intangible Assets | 12 Months Ended | |||||||||||||||
Jan. 02, 2015 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||
INTANGIBLE ASSETS | ||||||||||||||||
7 | INTANGIBLE ASSETS | |||||||||||||||
Amortizing intangible assets, net are comprised of the following (in thousands): | ||||||||||||||||
Gross | Accumulated | Foreign | Net | |||||||||||||
Carrying | Amortization | Currency | Carrying | |||||||||||||
Amount | Translation | Amount | ||||||||||||||
At January 2, 2015 | ||||||||||||||||
Purchased technology and patents | $ | 95,776 | $ | (75,894 | ) | $ | 1,966 | $ | 21,848 | |||||||
Customer lists | 72,857 | (31,460 | ) | 1,374 | 42,771 | |||||||||||
Other | 4,534 | (4,619 | ) | 803 | 718 | |||||||||||
Total amortizing intangible assets | $ | 173,167 | $ | (111,973 | ) | $ | 4,143 | $ | 65,337 | |||||||
At January 3, 2014 | ||||||||||||||||
Purchased technology and patents | $ | 97,376 | $ | (69,026 | ) | $ | 1,980 | $ | 30,330 | |||||||
Customer lists | 68,257 | (24,671 | ) | 1,367 | 44,953 | |||||||||||
Other | 4,434 | (4,399 | ) | 804 | 839 | |||||||||||
Total amortizing intangible assets | $ | 170,067 | $ | (98,096 | ) | $ | 4,151 | $ | 76,122 | |||||||
Aggregate intangible asset amortization expense is comprised of the following (in thousands): | ||||||||||||||||
Year Ended | ||||||||||||||||
January 2, | January 3, | December 28, | ||||||||||||||
2015 | 2014 | 2012 | ||||||||||||||
Cost of sales | $ | 6,201 | $ | 6,822 | $ | 7,489 | ||||||||||
SG&A | 7,009 | 5,800 | 6,227 | |||||||||||||
RD&E | 667 | 545 | 545 | |||||||||||||
Total intangible asset amortization expense | $ | 13,877 | $ | 13,167 | $ | 14,261 | ||||||||||
Estimated future intangible asset amortization expense based upon the current carrying value is as follows (in thousands): | ||||||||||||||||
Estimated | ||||||||||||||||
Amortization | ||||||||||||||||
Expense | ||||||||||||||||
2015 | $ | 12,988 | ||||||||||||||
2016 | 10,676 | |||||||||||||||
2017 | 9,520 | |||||||||||||||
2018 | 7,232 | |||||||||||||||
2019 | 5,431 | |||||||||||||||
Thereafter | 19,490 | |||||||||||||||
Total estimated amortization expense | $ | 65,337 | ||||||||||||||
As of January 3, 2014, the Company had recorded in Other Long-Term Liabilities $4.0 million of contingent liabilities incurred in connection with technology purchases made in previous years. During 2014, the Company reversed $3.0 million of these contingent liabilities as a result of certain performance targets not being achieved, which reduced the technology asset recorded at the time of the asset purchase. | ||||||||||||||||
The change in indefinite-lived assets during 2014 is as follows (in thousands) | ||||||||||||||||
Trademarks | ||||||||||||||||
and | ||||||||||||||||
Tradenames | ||||||||||||||||
At January 3, 2014 | $ | 20,288 | ||||||||||||||
At January 2, 2015 | $ | 20,288 | ||||||||||||||
The change in goodwill during 2014 is as follows (in thousands): | ||||||||||||||||
Greatbatch | QiG | Total | ||||||||||||||
Medical | ||||||||||||||||
At January 3, 2014 | $ | 304,856 | $ | 41,800 | $ | 346,656 | ||||||||||
Goodwill acquired (Note 2) | — | 8,296 | 8,296 | |||||||||||||
Foreign currency translation | (559 | ) | — | (559 | ) | |||||||||||
At January 2, 2015 | $ | 304,297 | $ | 50,096 | $ | 354,393 | ||||||||||
As of January 2, 2015, no accumulated impairment loss has been recognized for the goodwill allocated to the Company’s Greatbatch Medical or QiG segments. |
Accrued_Expenses
Accrued Expenses | 12 Months Ended | |||||||
Jan. 02, 2015 | ||||||||
Accounts Payable and Accrued Liabilities [Abstract] | ||||||||
ACCRUED EXPENSES | ||||||||
8 | ACCRUED EXPENSES | |||||||
Accrued expenses are comprised of the following (in thousands): | ||||||||
At | ||||||||
January 2, | January 3, | |||||||
2015 | 2014 | |||||||
Salaries and benefits | $ | 20,770 | $ | 16,311 | ||||
Profit sharing and bonuses | 18,524 | 19,808 | ||||||
Warranty | 660 | 1,819 | ||||||
Other | 8,430 | 6,743 | ||||||
Total | $ | 48,384 | $ | 44,681 | ||||
Debt
Debt | 12 Months Ended | ||||||||||||||||||||||
Jan. 02, 2015 | |||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||
DEBT | |||||||||||||||||||||||
9 | DEBT | ||||||||||||||||||||||
Long-term debt is comprised of the following (in thousands): | |||||||||||||||||||||||
At | |||||||||||||||||||||||
January 2, | 3-Jan-14 | ||||||||||||||||||||||
2015 | |||||||||||||||||||||||
Variable rate term loan | $ | 187,500 | $ | 197,500 | |||||||||||||||||||
Revolving line of credit | — | — | |||||||||||||||||||||
Total debt | 187,500 | 197,500 | |||||||||||||||||||||
Less current portion of long-term debt | 11,250 | — | |||||||||||||||||||||
Total long-term debt | $ | 176,250 | $ | 197,500 | |||||||||||||||||||
Credit Facility – In September 2013, the Company amended and extended its credit facility (the “Credit Facility”). The Credit Facility provides a $300 million revolving credit facility (the “Revolving Credit Facility”), a $200 million term loan (the “Term Loan”), a $15 million letter of credit subfacility, and a $15 million swingline subfacility. The Revolving Credit Facility can be increased by $200 million upon the Company’s request and approval by the lenders. The Revolving Credit Facility has a maturity date of September 20, 2018, which may be extended to September 20, 2019 upon notice by the Company and subject to certain conditions. The principal of the Term Loan is payable in quarterly installments as specified in the Credit Facility until its maturity date of September 20, 2019 when the unpaid balance is due in full. | |||||||||||||||||||||||
The Credit Facility is secured by the Company’s non-realty assets including cash, accounts receivable and inventories. Interest rates on the Revolving Credit Facility and Term Loan are, at the Company’s option either at: (i) the prime rate plus the applicable margin, which ranges between 0.0% and 0.75%, based on the Company’s total leverage ratio or (ii) the applicable LIBOR rate plus the applicable margin, which ranges between 1.375% and 2.75%, based on the Company’s total leverage ratio. Loans under the swingline subfacility will bear interest at the prime rate plus the applicable margin, which ranges between 0.0% and 0.75%, based on the Company’s total leverage ratio. The Company is also required to pay a commitment fee, which varies between 0.175% and 0.25% depending on the Company’s total leverage ratio. | |||||||||||||||||||||||
The Credit Facility contains limitations on the incurrence of indebtedness, liens and licensing of intellectual property, investments and certain payments. The Credit Facility permits the Company to engage in the following activities up to an aggregate amount of $300 million: 1) permitted acquisitions in the aggregate not to exceed $250 million; 2) other investments in the aggregate not to exceed $100 million; 3) stock repurchases and dividends not to exceed $150 million in the aggregate; and 4) investments in foreign subsidiaries not to exceed $20 million in the aggregate. At any time that the total leverage ratio of the Company for the two most recently ended fiscal quarters is less than 2.75 to 1.0, the Company may make an election to reset each of the amounts specified above. Additionally, these limitations can be waived upon the Company’s request and approval of a majority of the lenders. As of January 2, 2015, the Company had available to it 100% of the above limits except for the aggregate limit, acquisitions limit, and other investments limit which are now $277 million, $230 million, and $97 million, respectively. | |||||||||||||||||||||||
The Credit Facility requires the Company to maintain a rolling four quarter ratio of adjusted EBITDA to interest expense of at least 3.0 to 1.0, and a total leverage ratio of not greater than 4.5 to 1.0 decreasing to not greater than 4.25 to 1.0 after January 2, 2016. The calculation of adjusted EBITDA and total leverage ratio excludes non-cash charges, extraordinary, unusual, or non-recurring expenses or losses, non-cash stock-based compensation, and non-recurring expenses or charges incurred in connection with permitted acquisitions. As of January 2, 2015, the Company was in compliance with all covenants under the Credit Facility. | |||||||||||||||||||||||
The Credit Facility contains customary events of default. Upon the occurrence and during the continuance of an event of default, a majority of the lenders may declare the outstanding advances and all other obligations under the Credit Facility immediately due and payable. | |||||||||||||||||||||||
As of January 2, 2015, the weighted average interest rate on borrowings under the Credit Facility, which does not take into account the impact of the Company’s interest rate swap, was 1.57%. As of January 2, 2015, the Company had $300 million of borrowing capacity available under the Credit Facility. This borrowing capacity may vary from period to period based upon the debt and EBITDA levels of the Company, which impacts the covenant calculations described above. | |||||||||||||||||||||||
Interest Rate Swaps – From time to time, the Company enters into interest rate swap agreements in order to hedge against potential changes in cash flows on the outstanding borrowings on the Credit Facility. The variable rate received on the interest rate swaps and the variable rate paid on the debt have the same rate of interest, excluding the credit spread, indexed to the one-month LIBOR rate and reset and pay interest on the same date. During 2012, the Company entered into a three-year $150 million interest rate swap, which amortizes $50 million per year. During 2014, the Company entered into an additional interest rate swap. The first $45 million of notional amount of the swap is effective February 20, 2015 and the second $45 million of notional amount is effective February 22, 2016. The notional amount of the swap amortizes $10 million per year beginning on February 21, 2017 with the remaining settled on the termination date of the swap agreement on September 20, 2019. These swaps are being accounted for as cash flow hedges. | |||||||||||||||||||||||
Information regarding the Company’s outstanding interest rate swaps as of January 2, 2015 is as follows (dollars in thousands): | |||||||||||||||||||||||
Instrument | Type of | Notional | Start | End | Pay | Current | Fair | Balance | |||||||||||||||
Hedge | Amount | Date | Date | Fixed | Receive | Value | Sheet Location | ||||||||||||||||
Rate | Floating | 2-Jan-15 | |||||||||||||||||||||
Rate | |||||||||||||||||||||||
Interest rate swap | Cash flow | $ | 100,000 | 13-Feb | 16-Feb | 0.573 | % | 0.155 | % | $ | (125 | ) | Other Long-Term Liabilities | ||||||||||
Interest rate swap | Cash flow | $ | 90,000 | 15-Feb | 19-Sep | 1.921 | % | N/A | $ | (865 | ) | Other Long-Term Liabilities | |||||||||||
The estimated fair value of the interest rate swap agreements represents the amount the Company expects to receive (pay) to terminate the contract. No portion of the change in fair value of the Company’s interest rate swaps during 2014, 2013, or 2012 was considered ineffective. The amount recorded as Interest Expense during 2014, 2013, and 2012 related to the Company’s interest rate swaps was $0.5 million, $0.5 million and $0.0 million, respectively. | |||||||||||||||||||||||
The expected future minimum principal payments under the Credit Facility as of January 2, 2015 are as follows (in thousands): | |||||||||||||||||||||||
2015 | $ | 11,250 | |||||||||||||||||||||
2016 | 16,250 | ||||||||||||||||||||||
2017 | 20,000 | ||||||||||||||||||||||
2018 | 20,000 | ||||||||||||||||||||||
2019 | 120,000 | ||||||||||||||||||||||
Total | 187,500 | ||||||||||||||||||||||
Convertible Subordinated Notes – In March 2007, the Company issued $197.8 million of CSN at a 5% discount. CSN accrued interest at 2.25% per annum. The effective interest rate of CSN, which took into consideration the amortization of the discount and deferred fees related to the issuance of these notes, was 8.5%. On February 20, 2013, the Company redeemed all outstanding CSN. The contractual interest and discount amortization for CSN were as follows (in thousands): | |||||||||||||||||||||||
Year Ended | |||||||||||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||||||||||
2015 | 2014 | 2012 | |||||||||||||||||||||
Contractual interest | $ | — | $ | 634 | $ | 4,450 | |||||||||||||||||
Discount amortization | — | 5,368 | 11,464 | ||||||||||||||||||||
Deferred Financing Fees - The change in deferred financing fees is as follows (in thousands): | |||||||||||||||||||||||
At December 28, 2012 | $ | 2,056 | |||||||||||||||||||||
Financing costs deferred | 2,802 | ||||||||||||||||||||||
Write-off during the period | (156 | ) | |||||||||||||||||||||
Amortization during the period | (842 | ) | |||||||||||||||||||||
At January 3, 2014 | 3,860 | ||||||||||||||||||||||
Amortization during the period | (773 | ) | |||||||||||||||||||||
At January 2, 2015 | $ | 3,087 | |||||||||||||||||||||
Benefit_Plans
Benefit Plans | 12 Months Ended | |||||||||||||||
Jan. 02, 2015 | ||||||||||||||||
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | ||||||||||||||||
BENEFIT PLANS | ||||||||||||||||
10 | BENEFIT PLANS | |||||||||||||||
Savings Plan – The Company sponsors a defined contribution 401(k) plan, for its U.S. based employees. The plan provides for the deferral of employee compensation under Section 401(k) and a discretionary Company match. In 2014, 2013, and 2012, this match was 35% per dollar of participant deferral, up to 6% of the total compensation for each participant. Net costs related to this defined contribution plan were $2.2 million in 2014 and $2.0 million in 2013 and 2012. | ||||||||||||||||
In addition to the above, under the terms of the 401(k) plan document there is an annual discretionary defined contribution of up to 4% of each employee’s eligible compensation based upon the achievement of certain performance targets. This amount is contributed to the 401(k) plan in the form of Company stock. Compensation cost recognized related to the defined contribution plan was $4.2 million, $4.8 million, $1.9 million in 2014, 2013, and 2012, respectively. As of January 2, 2015, the 401(k) Plan held 602,604 shares of Company stock. | ||||||||||||||||
Education Assistance Program – The Company reimburses tuition, textbooks and laboratory fees for college or other job related programs for all of its U.S. based employees. The Company also reimburses college tuition for the dependent children of certain full-time U.S. based employees hired prior to 2012, which vests on a straight-line basis over ten years, up to the applicable local state university tuition rate. For certain employees and executives, the dependent children benefit is not limited. Minimum academic achievement is required in order to receive reimbursement under both programs. Aggregate expenses under the programs were $1.9 million, $2.0 million, and $2.2 million in 2014, 2013 and 2012, respectively. | ||||||||||||||||
Defined Benefit Plans – The Company is required to provide its employees located in Switzerland, Mexico, and France certain statutorily mandated defined benefits. Under these plans, benefits accrue to employees based upon years of service, position, age and compensation. The defined benefit pension plan provided to the Company’s employees located in Switzerland is a funded contributory plan, while the plans that provide benefits to the Company’s employees located in Mexico and France are unfunded and noncontributory. The liability and corresponding expense related to these benefit plans is based on actuarial computations of current and future benefits for employees. | ||||||||||||||||
During 2012, the Company transferred most major functions performed at its facilities in Switzerland into other existing facilities. As a result, the Company curtailed its defined benefit plan provided to employees at those Swiss facilities during 2012. In accordance with ASC 715, this gain was recognized in Other Operating Expenses, Net as the related employees were terminated. Since Swiss plan assets were sufficient to cover all plan liabilities, during 2012 the plan assets were transferred into cash. During 2013, the plan assets that remained after settlement payments were made were transferred to an AA- rated insurance carrier who bears the pension risk and longevity risk, and will be used to cover the pension liability for the remaining retirees of the Swiss plan, as well as the remaining employees at that location. | ||||||||||||||||
Information relating to the funding position of the Company’s defined benefit plans as of the plans measurement date of January 2, 2015 and January 3, 2014 were as follows (in thousands): | ||||||||||||||||
Year Ended | ||||||||||||||||
January 2, | January 3, | |||||||||||||||
2015 | 2014 | |||||||||||||||
Change in projected benefit obligation: | ||||||||||||||||
Projected benefit obligation at beginning of year | $ | 2,422 | $ | 16,215 | ||||||||||||
Service cost | 203 | 236 | ||||||||||||||
Interest cost | 75 | 138 | ||||||||||||||
Prior service cost and plan amendments | — | (45 | ) | |||||||||||||
Plan participants’ contribution | 36 | 134 | ||||||||||||||
Actuarial (gain) loss | 630 | (2 | ) | |||||||||||||
Benefits transferred in, net | 155 | 434 | ||||||||||||||
Settlement/curtailment gain | (337 | ) | (14,539 | ) | ||||||||||||
Foreign currency translation | (341 | ) | (149 | ) | ||||||||||||
Projected benefit obligation at end of year | 2,843 | 2,422 | ||||||||||||||
Change in fair value of plan assets: | ||||||||||||||||
Fair value of plan assets at beginning of year | 731 | 12,269 | ||||||||||||||
Employer contributions (refund) | (39 | ) | 150 | |||||||||||||
Plan participants’ contributions | 36 | 134 | ||||||||||||||
Actual loss on plan assets | (101 | ) | (26 | ) | ||||||||||||
Benefits transferred in, net | 198 | 138 | ||||||||||||||
Settlements | (337 | ) | (11,780 | ) | ||||||||||||
Foreign currency translation | (51 | ) | (154 | ) | ||||||||||||
Fair value of plan assets at end of year | 437 | 731 | ||||||||||||||
Projected benefit obligation in excess of plan assets at end of year | $ | 2,406 | $ | 1,691 | ||||||||||||
Defined benefit liability classified as other current liabilities | $ | 25 | $ | 25 | ||||||||||||
Defined benefit liability classified as long-term liabilities | $ | 2,381 | $ | 1,666 | ||||||||||||
Accumulated benefit obligation at end of year | $ | 1,938 | $ | 1,684 | ||||||||||||
Amounts recognized in Accumulated Other Comprehensive Income are as follows (in thousands): | ||||||||||||||||
Year Ended | ||||||||||||||||
January 2, | January 3, | |||||||||||||||
2015 | 2014 | |||||||||||||||
Net loss occurring during the year | $ | 736 | $ | 25 | ||||||||||||
Amortization of losses | (138 | ) | (722 | ) | ||||||||||||
Prior service cost | (2 | ) | 150 | |||||||||||||
Amortization of prior service cost | (11 | ) | 33 | |||||||||||||
Foreign currency translation | (76 | ) | 224 | |||||||||||||
Pre-tax adjustment | 509 | (290 | ) | |||||||||||||
Taxes | (135 | ) | 18 | |||||||||||||
Net (gain) loss | $ | 374 | $ | (272 | ) | |||||||||||
The amortization of amounts in Accumulated Other Comprehensive Income expected to be recognized as components of net periodic benefit expense during 2015 are as follows (in thousands): | ||||||||||||||||
Amortization of net prior service cost | $ | 11 | ||||||||||||||
Amortization of net loss | 45 | |||||||||||||||
Net pension cost (income) is comprised of the following (in thousands): | ||||||||||||||||
Year Ended | ||||||||||||||||
2-Jan-15 | 3-Jan-14 | |||||||||||||||
Service cost | $ | 203 | $ | 236 | ||||||||||||
Interest cost | 75 | 138 | ||||||||||||||
Settlements loss | 105 | — | ||||||||||||||
Expected return on assets | (3 | ) | — | |||||||||||||
Recognized net actuarial loss (gain) | 45 | (1,929 | ) | |||||||||||||
Net pension cost (income) | $ | 425 | $ | (1,555 | ) | |||||||||||
The weighted-average rates used in the actuarial valuations were as follows: | ||||||||||||||||
Projected Benefit Obligation | Net Pension Cost | |||||||||||||||
January 2, | January 3, | 2014 | 2013 | 2012 | ||||||||||||
2015 | 2014 | |||||||||||||||
Discount rate | 2.3 | % | 3.4 | % | 3.4 | % | 2.1 | % | 2.5 | % | ||||||
Salary growth | 3 | % | 3.1 | % | 3.1 | % | 2.4 | % | 2.3 | % | ||||||
Expected rate of return on assets | 2.3 | % | 2.5 | % | 2.5 | % | — | % | 3.5 | % | ||||||
The discount rate used is based on the yields of AA bonds with a duration matching the duration of the liabilities plus approximately 50 basis points to reflect the risk of investing in corporate bonds. The expected rate of return on plan assets reflects earnings expectations on existing plan assets. | ||||||||||||||||
Plan assets were comprised of the following (in thousands): | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
2-Jan-15 | Quoted | Significant | Significant | |||||||||||||
Prices in | Other | Unobservable | ||||||||||||||
Active | Observable | Inputs | ||||||||||||||
Markets for | Inputs | (Level 3) | ||||||||||||||
Identical | (Level 2) | |||||||||||||||
Assets | ||||||||||||||||
(Level 1) | ||||||||||||||||
Insurance contract | $ | 437 | $ | — | $ | 437 | $ | — | ||||||||
Total | $ | 437 | $ | — | $ | 437 | $ | — | ||||||||
Fair Value Measurements Using | ||||||||||||||||
January 3, | Quoted | Significant | Significant | |||||||||||||
2014 | Prices in | Other | Unobservable | |||||||||||||
Active | Observable | Inputs | ||||||||||||||
Markets for | Inputs | (Level 3) | ||||||||||||||
Identical | (Level 2) | |||||||||||||||
Assets | ||||||||||||||||
(Level 1) | ||||||||||||||||
Insurance contract | $ | 731 | $ | — | $ | 731 | $ | — | ||||||||
Total | $ | 731 | $ | — | $ | 731 | $ | — | ||||||||
The fair value of Level 2 plan assets are obtained from quoted market prices in inactive markets or valuation models with observable market data inputs to estimate fair value. These observable market data inputs include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, benchmark securities, bids, offers and reference data. | ||||||||||||||||
Estimated benefit payments over the next ten years are as follows (in thousands): | ||||||||||||||||
2015 | $ | 47 | ||||||||||||||
2016 | 67 | |||||||||||||||
2017 | 124 | |||||||||||||||
2018 | 113 | |||||||||||||||
2019 | 177 | |||||||||||||||
2020-2024 | 866 | |||||||||||||||
StockBased_Compensation
Stock-Based Compensation | 12 Months Ended | ||||||||||||
Jan. 02, 2015 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||
STOCK-BASED COMPENSATION | |||||||||||||
11 | STOCK-BASED COMPENSATION | ||||||||||||
The components and classification of stock-based compensation expense were as follows (in thousands): | |||||||||||||
Year Ended | |||||||||||||
January 2, | January 3, | December 28, | |||||||||||
2015 | 2014 | 2012 | |||||||||||
Stock options | $ | 2,523 | $ | 3,490 | $ | 2,786 | |||||||
Restricted stock and units | 6,417 | 5,843 | 6,233 | ||||||||||
401(k) stock contribution | 4,246 | 4,768 | 1,885 | ||||||||||
Total stock-based compensation expense | $ | 13,186 | $ | 14,101 | $ | 10,904 | |||||||
Cost of sales | $ | 3,530 | $ | 3,864 | $ | 2,620 | |||||||
Selling, general and administrative expenses | 7,923 | 7,907 | 7,684 | ||||||||||
Research, development and engineering costs, net | 1,440 | 1,194 | 600 | ||||||||||
Other operating expenses, net (Note 13) | 293 | 1,136 | — | ||||||||||
Total stock-based compensation expense | $ | 13,186 | $ | 14,101 | $ | 10,904 | |||||||
During 2014 and 2013, the Company recorded within Other Operating Expenses, Net stock modification expense related to employee separation costs incurred during 2014 and 2013 in connection with realignment initiatives, which are discussed in Note 13 “Other Operating Expenses, Net.” | |||||||||||||
Summary of Plans | |||||||||||||
The Company’s 1998 Stock Option Plan and Non-Employee Directors Stock Plan have been frozen to any new award issuances. Stock options remain outstanding under these plans. | |||||||||||||
The Company’s 2005 Stock Incentive Plan (“2005 Plan”), as amended, authorizes the issuance of up to 2,450,000 shares of equity incentive awards including nonqualified and incentive stock options, restricted stock, restricted stock units, stock bonuses and stock appreciation rights subject to the terms of the 2005 Plan. The 2005 Plan limits the amount of restricted stock, restricted stock units and stock bonuses that may be awarded in the aggregate to 850,000 shares of the 2,450,000 shares authorized by the 2005 Plan. | |||||||||||||
The Company’s 2009 Stock Incentive Plan (“2009 Plan”) authorizes the issuance of up to 1,350,000 shares of equity incentive awards including nonqualified and incentive stock options, restricted stock, restricted stock units, stock bonuses and stock appreciation rights subject to the terms of the 2009 Plan. The 2009 Plan limits the amount of restricted stock, restricted stock units and stock bonuses that may be awarded in the aggregate to 200,000 shares of the 1,350,000 shares authorized. | |||||||||||||
The Company’s 2011 Stock Incentive Plan (“2011 Plan”), as amended, authorizes the issuance of up to 1,350,000 shares of equity incentive awards including nonqualified and incentive stock options, restricted stock, restricted stock units, stock bonuses and stock appreciation rights, subject to the terms of the 2011 Plan. The 2011 Plan does not limit the amount of restricted stock, restricted stock units or stock bonuses that may be awarded. | |||||||||||||
As of January 2, 2015, there were 575,451, 316,695, and 16,799 shares available for future grants under the 2011 Plan, 2009 Plan and 2005 Plan, respectively. Due to plan sub-limits, of the shares available for grant, only 26,594 shares and 3,625 shares may be awarded under the 2009 Plan and the 2005 Plan, respectively, in the form of restricted stock, restricted stock units or stock bonuses. | |||||||||||||
Stock Options | |||||||||||||
Stock options granted generally vest over a three year period, expire 10 years from the date of grant, and are granted at exercise prices equal to or greater than the fair value of the Company’s common stock on the date of grant. Performance-based stock options have not been granted since 2010. | |||||||||||||
The Company utilizes the Black-Scholes option pricing model to determine the fair value of stock options. Management is required to make certain assumptions with respect to selected model inputs. Expected volatility is based on the historical volatility of the Company’s stock over the most recent period commensurate with the estimated expected life of the stock options. The expected life of stock options, which represents the period of time that the stock options are expected to be outstanding, is based on historical data. The expected dividend yield is based on the Company’s history and expectation of future dividend payouts. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for a period commensurate with the estimated expected life. If factors change and result in different assumptions, the stock option expense that the Company records for future grants may differ significantly from what the Company recorded in the current period. Stock-based compensation expense is only recorded for those awards that are expected to vest. Pre-vesting forfeiture estimates for determining appropriate stock-based compensation expense are estimated at the time of grant based on historical experience. Revisions are made to those estimates in subsequent periods if actual forfeitures differ from estimated forfeitures. | |||||||||||||
The weighted-average fair value and assumptions used are as follows: | |||||||||||||
Year Ended | |||||||||||||
January 2, | January 3, | December 28, | |||||||||||
2015 | 2014 | 2012 | |||||||||||
Weighted average grant date fair value | $ | 16.43 | $ | 8.38 | $ | 8.2 | |||||||
Risk-free interest rate | 1.73 | % | 0.73 | % | 0.83 | % | |||||||
Expected volatility | 39 | % | 39 | % | 40 | % | |||||||
Expected life (in years) | 5.3 | 5.3 | 5.3 | ||||||||||
Expected dividend yield | 0 | % | 0 | % | 0 | % | |||||||
Annual prevesting forfeiture rate | 9 | % | 9 | % | 9 | % | |||||||
The following table summarizes time-vested stock option activity: | |||||||||||||
Number of | Weighted | Weighted | Aggregate | ||||||||||
Time-Vested | Average | Average | Intrinsic | ||||||||||
Stock | Exercise | Remaining | Value | ||||||||||
Options | Price | Contractual | (In Millions) | ||||||||||
Life | |||||||||||||
(In Years) | |||||||||||||
Outstanding at December 30, 2011 | 1,558,771 | $ | 23.42 | ||||||||||
Granted | 395,978 | 22.19 | |||||||||||
Exercised | (52,683 | ) | 20.77 | ||||||||||
Forfeited or expired | (126,219 | ) | 24.21 | ||||||||||
Outstanding at December 28, 2012 | 1,775,847 | 23.17 | |||||||||||
Granted | 372,676 | 23.33 | |||||||||||
Exercised | (443,428 | ) | 23.24 | ||||||||||
Forfeited or expired | (88,686 | ) | 28.05 | ||||||||||
Outstanding at January 3, 2014 | 1,616,409 | 22.92 | |||||||||||
Granted | 183,571 | 43.84 | |||||||||||
Exercised | (295,203 | ) | 23.42 | ||||||||||
Forfeited or expired | (33,279 | ) | 27.82 | ||||||||||
Outstanding at January 2, 2015 | 1,471,498 | $ | 25.32 | 6.1 | $ | 34.3 | |||||||
Expected to vest at January 2, 2015 | 1,447,519 | $ | 25.1 | 6.1 | $ | 34.1 | |||||||
Exercisable at January 2, 2015 | 1,278,765 | $ | 23.88 | 5.8 | $ | 31.7 | |||||||
The following table summarizes performance-vested stock option activity: | |||||||||||||
Number of | Weighted | Weighted | Aggregate | ||||||||||
Performance- | Average | Average | Intrinsic | ||||||||||
Vested Stock | Exercise | Remaining | Value | ||||||||||
Options | Price | Contractual | (In Millions) | ||||||||||
Life | |||||||||||||
(In Years) | |||||||||||||
Outstanding at December 30, 2011 | 478,364 | $ | 24.44 | ||||||||||
Exercised | (7,657 | ) | 22.04 | ||||||||||
Forfeited or expired | (185,782 | ) | 26.35 | ||||||||||
Outstanding at December 28, 2012 | 284,925 | 23.26 | |||||||||||
Exercised | (107,664 | ) | 23.23 | ||||||||||
Forfeited or expired | — | — | |||||||||||
Outstanding at January 3, 2014 | 177,261 | 23.27 | |||||||||||
Exercised | (58,422 | ) | 23.35 | ||||||||||
Forfeited or expired | — | — | |||||||||||
Outstanding at January 2, 2015 | 118,839 | $ | 23.24 | 3 | $ | 3 | |||||||
Expected to vest at January 2, 2015 | 118,839 | $ | 23.24 | 3 | $ | 3 | |||||||
Exercisable at January 2, 2015 | 118,839 | $ | 23.24 | 3 | $ | 3 | |||||||
Intrinsic value is calculated for in-the-money options (exercise price less than market price) as the difference between the market price of the Company’s common shares as of January 2, 2015 ($48.66) and the weighted average exercise price of the underlying stock options, multiplied by the number of options outstanding and/or exercisable. As of January 2, 2015, $2.1 million of unrecognized compensation cost related to non-vested stock options is expected to be recognized over a weighted-average period of approximately 2 years. Shares are distributed from the Company’s authorized but unissued reserve upon the exercise of stock options or treasury stock if available. The Company does not intend to purchase treasury shares to fund the future exercises of stock options. | |||||||||||||
Proceeds from the exercise of stock options are credited to common stock at par value and the excess is credited to additional paid-in capital. A portion of the options outstanding qualify as incentive stock options (“ISO”) for income tax purposes. As such, a tax benefit is not recorded at the time the compensation cost related to the stock options is recorded for book purposes due to the fact that an ISO does not ordinarily result in a tax benefit unless there is a disqualifying disposition. Stock option grants of non-qualified stock options result in the creation of a deferred tax asset, which is a temporary difference, until the time that the option is exercised. | |||||||||||||
The following table provides certain information relating to the exercise of stock options (in thousands): | |||||||||||||
Year Ended | |||||||||||||
January 2, | January 3, | December 28, | |||||||||||
2015 | 2014 | 2012 | |||||||||||
Intrinsic value | $ | 7,997 | $ | 6,807 | $ | 148 | |||||||
Cash received | 8,278 | 12,807 | 1,263 | ||||||||||
Tax benefit (expense) realized | 1,704 | 727 | (132 | ) | |||||||||
Restricted Stock and Restricted Stock Units | |||||||||||||
Time-vested restricted stock and restricted stock unit awards granted typically vest in equal annual installments over a three or four year period. The fair value of time-based as well as nonmarket-based performance restricted stock and restricted stock unit awards is equal to the fair value of the Company’s stock on the date of grant. The following table summarizes time-vested restricted stock and unit activity: | |||||||||||||
Time-Vested | Weighted | ||||||||||||
Activity | Average | ||||||||||||
Fair Value | |||||||||||||
Nonvested at December 30, 2011 | 69,942 | $ | 22.69 | ||||||||||
Granted | 92,265 | 23.49 | |||||||||||
Vested | (74,901 | ) | 22.83 | ||||||||||
Forfeited | (7,037 | ) | 22.56 | ||||||||||
Nonvested at December 28, 2012 | 80,269 | 23.48 | |||||||||||
Granted | 67,230 | 26.76 | |||||||||||
Vested | (74,062 | ) | 23.93 | ||||||||||
Forfeited | (5,862 | ) | 22.26 | ||||||||||
Nonvested at January 3, 2014 | 67,575 | 26.37 | |||||||||||
Granted | 63,817 | 44.78 | |||||||||||
Vested | (53,568 | ) | 34.16 | ||||||||||
Forfeited | (9,992 | ) | 35.3 | ||||||||||
Nonvested at January 2, 2015 | 67,832 | $ | 36.22 | ||||||||||
Performance-based restricted stock units granted only vest if certain market-based performance metrics are achieved. The amount of shares that ultimately vest range from 0 shares to 716,163 shares based upon the total shareholder return of the Company relative to the Company’s compensation peer group over a three year performance period beginning in the year of grant. The fair value of the restricted stock units was determined by utilizing a Monte Carlo simulation model, which projects the value of Greatbatch stock versus the peer group under numerous scenarios and determines the value of the award based upon the present value of these projected outcomes. The following table summarizes performance-vested restricted stock and stock unit activity related to the Company’s plans: | |||||||||||||
Performance- | Weighted | ||||||||||||
Vested | Average | ||||||||||||
Activity | Fair Value | ||||||||||||
Nonvested at December 30, 2011 | 529,743 | $ | 16.68 | ||||||||||
Granted | 332,918 | 15.3 | |||||||||||
Vested | (15,500 | ) | 24.64 | ||||||||||
Forfeited | (64,715 | ) | 15.72 | ||||||||||
Nonvested at December 28, 2012 | 782,446 | 16.02 | |||||||||||
Granted | 318,169 | 15.86 | |||||||||||
Vested | (49,139 | ) | 14.68 | ||||||||||
Forfeited | (271,798 | ) | 14.94 | ||||||||||
Nonvested at January 3, 2014 | 779,678 | 16.41 | |||||||||||
Granted | 186,825 | 31.33 | |||||||||||
Vested | (221,470 | ) | 18.51 | ||||||||||
Forfeited | (28,870 | ) | 18.42 | ||||||||||
Nonvested at January 2, 2015 | 716,163 | $ | 19.57 | ||||||||||
The realized tax benefit (expense) from the vesting of restricted stock and restricted stock units was $2.3 million, $(0.4) million and $(0.02) million for 2014, 2013, 2012, respectively. As of January 2, 2015, there was $7.7 million of total unrecognized compensation cost related to the restricted stock and restricted stock unit awards. That cost is expected to be recognized over a weighted-average period of approximately 2 years. The fair value of shares vested in 2014, 2013, 2012 was $12.5 million, $4.0 million and $1.5 million, respectively. |
Research_Development_and_Engin
Research, Development and Engineering Costs | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Research and Development Expense [Abstract] | ||||||||||||
RESEARCH, DEVELOPMENT AND ENGINEERING COSTS, NET | ||||||||||||
12 | RESEARCH, DEVELOPMENT AND ENGINEERING COSTS, NET | |||||||||||
Research, Development and Engineering Costs, Net are comprised of the following (in thousands): | ||||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Research, development and engineering costs | $ | 58,974 | $ | 62,652 | $ | 62,848 | ||||||
Less: cost reimbursements | (9,129 | ) | (8,575 | ) | (10,358 | ) | ||||||
Total research, development and engineering costs, net | $ | 49,845 | $ | 54,077 | $ | 52,490 | ||||||
Other_Operating_Expenses_Net
Other Operating Expenses, Net | 12 Months Ended | |||||||||||||||
Jan. 02, 2015 | ||||||||||||||||
Other Income and Expenses [Abstract] | ||||||||||||||||
OTHER OPERATING EXPENSES, NET | ||||||||||||||||
13 | OTHER OPERATING EXPENSES, NET | |||||||||||||||
Other Operating Expenses, Net is comprised of the following (in thousands): | ||||||||||||||||
Year Ended | ||||||||||||||||
January 2, | January 3, | December 28, | ||||||||||||||
2015 | 2014 | 2012 | ||||||||||||||
2014 investments in capacity and capabilities | $ | 8,925 | $ | — | $ | — | ||||||||||
2013 operating unit realignment | 1,017 | 5,625 | — | |||||||||||||
Orthopaedic facilities optimization | 1,317 | 8,038 | 32,482 | |||||||||||||
Medical device facility optimization | 11 | 312 | 1,525 | |||||||||||||
ERP system upgrade (income) costs | (82 | ) | 783 | 5,041 | ||||||||||||
Acquisition and integration (income) costs | 3 | (502 | ) | 1,460 | ||||||||||||
Asset dispositions, severance and other | 4,106 | 1,534 | 1,838 | |||||||||||||
Total other operating expenses, net | $ | 15,297 | $ | 15,790 | $ | 42,346 | ||||||||||
2014 investments in capacity and capabilities. In 2014, the Company announced several initiatives to invest in capacity and capabilities and to better align its resources to meet its customers’ needs and drive organic growth and profitability. These included the following: | ||||||||||||||||
• | Functions currently performed at the Company’s facility in Plymouth, MN to manufacture catheters and introducers will transfer into the Company’s existing facility in Tijuana, Mexico by the first half of 2016. | |||||||||||||||
• | Functions currently performed at the Company’s facilities in Beaverton, OR and Raynham, MA to manufacture products for the portable medical market will transfer to a new facility in Tijuana, Mexico by the end of 2015. Products currently manufactured at the Beaverton facility, which do not serve the portable medical market, are planned to transfer to the Company’s Raynham facility. | |||||||||||||||
• | Establishing a R&D hub in the Minneapolis/St. Paul, MN area for the Company’s Global R&D QiG - Medical Device Systems team, which will serve as the technical center of expertise for active implantable medical device development, implantable leads design, system level design verification testing, and continuation engineering. As part of this initiative, the design engineering responsibilities previously performed at the Company’s Cleveland, OH facility was transferred to the new R&D hub in 2014. | |||||||||||||||
• | Establishing a commercial operations hub at the Company’s global headquarters in Frisco, Texas. This initiative will build upon the investment the Company has made in its global sales and marketing function and is expected to be completed during the first half of 2015. | |||||||||||||||
The total capital investment expected for these initiatives is between $25.0 million and $27.0 million, of which $4.0 million has been expended to date. Total restructuring charges expected to be incurred in connection with this realignment are between $29.0 million and $34.0 million, of which $8.9 million has been incurred to date. Expenses related to this initiative are recorded within the applicable segment and corporate cost centers that the expenditures relate to and include the following: | ||||||||||||||||
• | Severance and retention: $7.0 million - $9.0 million; | |||||||||||||||
• | Accelerated depreciation and asset write-offs: $2.0 million - $3.0 million; and | |||||||||||||||
• | Other: $20.0 million - $22.0 million | |||||||||||||||
Other costs primarily consist of costs to relocate certain equipment and other personnel, duplicate personnel costs, disposal and travel expenditures. All expenses are cash expenditures, except accelerated depreciation and asset write-offs. | ||||||||||||||||
The change in accrued liabilities related to the 2014 investments in capacity and capabilities is as follows (in thousands): | ||||||||||||||||
Severance and Retention | Accelerated | Other | Total | |||||||||||||
Depreciation/ | ||||||||||||||||
Asset Write-offs | ||||||||||||||||
At January 3, 2014 | $ | — | $ | — | $ | — | $ | — | ||||||||
Restructuring charges | 2,209 | 33 | 6,683 | 8,925 | ||||||||||||
Write-offs | — | (33 | ) | — | (33 | ) | ||||||||||
Cash payments | (1,046 | ) | — | (5,617 | ) | (6,663 | ) | |||||||||
At January 2, 2015 | $ | 1,163 | $ | — | $ | 1,066 | $ | 2,229 | ||||||||
2013 operating unit realignment. In 2013, the Company initiated a plan to realign its operating structure in order to optimize its continued focus on profitable growth. As part of this initiative, the sales and marketing and operations groups of its former Implantable Medical and Electrochem reportable segments were combined into one sales and marketing and one operations group serving the entire Company. This initiative was completed during 2014. Total restructuring charges incurred in connection with this realignment were $6.6 million. Expenses related to this initiative were recorded within the applicable segment that the expenditures relate to and included the following: | ||||||||||||||||
• | Severance and retention: $5.0 million; and | |||||||||||||||
• | Other: $1.6 million. | |||||||||||||||
Other costs primarily consist of relocation, recruitment and travel expenditures. The change in accrued liabilities related to the 2013 operating unit realignment is as follows (in thousands): | ||||||||||||||||
Severance and Retention | Other | Total | ||||||||||||||
At January 3, 2014 | $ | 465 | $ | 746 | $ | 1,211 | ||||||||||
Restructuring charges | 849 | 168 | 1,017 | |||||||||||||
Cash payments | (1,314 | ) | (914 | ) | (2,228 | ) | ||||||||||
At January 2, 2015 | $ | — | $ | — | $ | — | ||||||||||
Orthopaedic facilities optimization. In 2010, the Company began updating its Indianapolis, IN facility to streamline operations, consolidate two buildings, increase capacity, further expand capabilities and reduce dependence on outside suppliers. This initiative was completed in 2011. | ||||||||||||||||
In 2011, the Company began construction of an orthopaedic manufacturing facility in Fort Wayne, IN and transferred manufacturing operations being performed at its Columbia City, IN location into this new facility. This initiative was completed in 2012. | ||||||||||||||||
During 2012, the Company transferred manufacturing and development operations performed at its facilities in Orvin and Corgemont, Switzerland into existing facilities in Fort Wayne, IN and Tijuana, Mexico. In connection with this consolidation, the Company curtailed its defined benefit plan provided to its Swiss employees and recognized a $1.9 million pension gain in 2013. See Note 10 “Benefit Plans” for additional information. Also in connection with this consolidation, in 2012, the Company entered into an agreement to sell assets related to certain non-core Swiss orthopaedic product lines to an independent third party. In connection with the transfer of these orthopaedic product lines to held for sale, the Company recognized a $3.6 million impairment charge in 2012 based upon the contractual sales price to the third party. This transaction closed during 2013 upon which the Company received payments totaling $4.7 million and the third party assumed $2.4 million of severance liabilities. The purchase agreement provided the Company with an earn out payment based upon the amount of inventory consumed by the purchaser within one year after the close of the transaction. As a result of this earn out, a gain of $2.7 million was recorded in Other Operating Expenses, Net during 2014. During 2014, the Company transferred $2.1 million of assets relating to the Company’s Orvin, Switzerland property to held for sale and recognized a $0.4 million impairment charge. See Note 5 “Assets Held For Sale” for additional information. | ||||||||||||||||
During 2013, the Company began a project to expand its Chaumont, France facility in order to enhance its capabilities and fulfill larger volume customer supply agreements. This initiative is expected to be completed over the next two years. | ||||||||||||||||
The total capital investment expected to be incurred for these initiatives is between $30 million and $35 million, of which $24.8 million has been expended to date. Total expense expected to be incurred for these initiatives is between $43 million and $48 million, of which $42.5 million has been incurred to date. All expenses have been and will be recorded within the Greatbatch Medical segment and are expected to include the following: | ||||||||||||||||
•Severance and retention: $11 million; | ||||||||||||||||
•Accelerated depreciation and asset write-offs: $13 million; | ||||||||||||||||
•Other: $19 million - $24 million. | ||||||||||||||||
Other costs include production inefficiencies, moving, revalidation, personnel, training and travel costs associated with these consolidation projects. All expenses are cash expenditures, except accelerated depreciation and asset write-offs. The change in accrued liabilities related to the orthopaedic facilities optimizations is as follows (in thousands): | ||||||||||||||||
Severance | Accelerated | Other | Total | |||||||||||||
and | Depreciation/ | |||||||||||||||
Retention | Asset Write-offs | |||||||||||||||
At January 3, 2014 | $ | — | $ | — | $ | 857 | $ | 857 | ||||||||
Restructuring charges (income), net | — | (2,255 | ) | 3,572 | 1,317 | |||||||||||
Write-offs | — | (400 | ) | — | (400 | ) | ||||||||||
Cash receipts (payments) | — | 2,655 | (4,142 | ) | (1,487 | ) | ||||||||||
At January 2, 2015 | $ | — | $ | — | $ | 287 | $ | 287 | ||||||||
Medical device facility optimization. Near the end of 2011, the Company initiated plans to upgrade and expand its manufacturing infrastructure in order to support its medical device strategy. This includes the transfer of certain product lines to create additional capacity for the manufacture of medical devices, expansion of two existing facilities, as well as the purchase of equipment to enable the production of medical devices. These initiatives were completed in 2014. Total capital investment under these initiatives was $12.5 million. Total expenses incurred on these projects was $1.8 million. All expenses were recorded within the Greatbatch Medical segment and included the following: | ||||||||||||||||
•Production inefficiencies, moving and revalidation: $0.7 million; | ||||||||||||||||
•Personnel: $0.6 million; and | ||||||||||||||||
•Other: approximately $0.5 million. | ||||||||||||||||
The change in accrued liabilities related to the medical device facility optimization is as follows (in thousands): | ||||||||||||||||
Production | Personnel | Other | Total | |||||||||||||
Inefficiencies, | ||||||||||||||||
Moving and | ||||||||||||||||
Revalidation | ||||||||||||||||
At January 3, 2014 | $ | — | $ | — | $ | — | $ | — | ||||||||
Restructuring charges | — | 1 | 10 | 11 | ||||||||||||
Cash payments | — | (1 | ) | (10 | ) | (11 | ) | |||||||||
At January 2, 2015 | $ | — | $ | — | $ | — | $ | — | ||||||||
ERP system upgrade (income) costs. In 2011, the Company initiated plans to upgrade its existing global ERP system. This initiative was completed in 2014. Total capital investment expended under this initiative was $4.0 million. Total expenses incurred on this initiative were $5.7 million. Expenses related to this initiative were recorded within the applicable segment and corporate cost centers that the expenditures related to and included the following: | ||||||||||||||||
•Training and consulting costs: $3.2 million; and | ||||||||||||||||
•Accelerated depreciation and asset write-offs: $2.5 million. | ||||||||||||||||
The change in accrued liabilities related to the ERP system upgrade is as follows (in thousands): | ||||||||||||||||
Training & | Accelerated | Total | ||||||||||||||
Consulting | Depreciation/ | |||||||||||||||
Costs | Asset Write-offs | |||||||||||||||
At January 3, 2014 | $ | — | $ | — | $ | — | ||||||||||
Restructuring income | (82 | ) | — | (82 | ) | |||||||||||
Cash receipts | 82 | — | 82 | |||||||||||||
At January 2, 2015 | $ | — | $ | — | $ | — | ||||||||||
Acquisition and integration (income) costs. During 2014, 2013, and 2012, the Company incurred costs (income) related to the integration of CCC, NeuroNexus, and Micro Power Electronics, Inc. These expenses were primarily for retention bonuses, travel cost in connection with integration efforts, training, severance, and the change in fair value of the contingent consideration recorded in connection with these acquisitions. See Note 18 “Fair Value Measurements” for additional information on the Company’s contingent consideration, which resulted in a gain of $0.8 million and $0.7 million in 2014, and 2013, respectively. | ||||||||||||||||
Asset dispositions, severance and other. During 2014, 2013, and 2012, the Company recorded losses in connection with various asset disposals and/or write-downs. During 2014, the Company incurred $0.9 million of expense related to the separation of the Company’s Senior Vice President, Human Resources. Additionally, during 2014, the Company recorded charges in connection with its business reorganization to align its contract manufacturing operations. Costs incurred primarily related to consulting and IT development and were completed in 2014. | ||||||||||||||||
During 2013, Greatbatch Medical recorded a $0.9 million write-off related to its wireless sensing product line and QiG recorded a $0.5 million write-off of IPR&D. See Note 18, “Fair Value Measurements” for additional information. | ||||||||||||||||
During 2012, the Company incurred $1.2 million of costs related to the relocation of its global headquarters to Frisco, Texas. |
Income_Taxes
Income Taxes | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||
INCOME TAXES | ||||||||||||
14 | INCOME TAXES | |||||||||||
The U.S. and international components of income before provision for income taxes were as follows (in thousands): | ||||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
U.S. | $ | 56,801 | $ | 42,392 | $ | 36,057 | ||||||
International | 19,778 | 6,446 | (29,327 | ) | ||||||||
Total income before provision for income taxes | $ | 76,579 | $ | 48,838 | $ | 6,730 | ||||||
The provision for income taxes was comprised of the following (in thousands): | ||||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Current: | ||||||||||||
Federal | $ | 16,293 | $ | 39,353 | $ | 4,747 | ||||||
State | 1,299 | 1,604 | 381 | |||||||||
International | 2,998 | 1,470 | 668 | |||||||||
20,590 | 42,427 | 5,796 | ||||||||||
Deferred: | ||||||||||||
Federal | 1,211 | (28,678 | ) | 6,615 | ||||||||
State | (310 | ) | 427 | 175 | ||||||||
International | (370 | ) | (1,605 | ) | (1,057 | ) | ||||||
531 | (29,856 | ) | 5,733 | |||||||||
Total provision for income taxes | $ | 21,121 | $ | 12,571 | $ | 11,529 | ||||||
The provision for income taxes differs from the U.S. statutory rate due to the following: | ||||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Statutory rate | 35 | % | 35 | % | 35 | % | ||||||
Federal tax credits | (2.1 | ) | (7.5 | ) | — | |||||||
Foreign rate differential | (4.3 | ) | (0.7 | ) | 50.7 | |||||||
Uncertain tax positions | 0.6 | 1.7 | (10.1 | ) | ||||||||
State taxes, net of federal benefit | 0.7 | 2.3 | 4.9 | |||||||||
Change in tax rate - loss of Swiss tax holiday | — | — | 25.6 | |||||||||
Change in foreign tax rates | (0.6 | ) | (3.7 | ) | — | |||||||
Valuation allowance | (0.4 | ) | 0.4 | 67.6 | ||||||||
Other | (1.3 | ) | (1.8 | ) | (2.4 | ) | ||||||
Effective tax rate | 27.6 | % | 25.7 | % | 171.3 | % | ||||||
Deferred tax assets (liabilities) consist of the following (in thousands): | ||||||||||||
At | ||||||||||||
January 2, | January 3, | |||||||||||
2015 | 2014 | |||||||||||
Tax credits | $ | 5,828 | $ | 6,624 | ||||||||
Net operating loss carryforwards | 6,721 | 9,161 | ||||||||||
Inventories | 3,335 | 4,202 | ||||||||||
Accrued expenses | 4,338 | 4,303 | ||||||||||
Stock-based compensation | 9,341 | 9,194 | ||||||||||
Other | 1,659 | 573 | ||||||||||
Gross deferred tax assets | 31,222 | 34,057 | ||||||||||
Less valuation allowance | (10,709 | ) | (11,661 | ) | ||||||||
Net deferred tax assets | 20,513 | 22,396 | ||||||||||
Property, plant and equipment | (2,646 | ) | (2,254 | ) | ||||||||
Intangible assets | (57,850 | ) | (57,648 | ) | ||||||||
Convertible subordinated notes | (5,006 | ) | (6,178 | ) | ||||||||
Gross deferred tax liabilities | (65,502 | ) | (66,080 | ) | ||||||||
Net deferred tax liability | $ | (44,989 | ) | $ | (43,684 | ) | ||||||
Presented as follows: | ||||||||||||
Current deferred tax asset | $ | 6,168 | $ | 6,008 | ||||||||
Current deferred tax liability | (588 | ) | (613 | ) | ||||||||
Noncurrent deferred tax asset | 2,626 | 2,933 | ||||||||||
Noncurrent deferred tax liability | (53,195 | ) | (52,012 | ) | ||||||||
Net deferred tax liability | $ | (44,989 | ) | $ | (43,684 | ) | ||||||
As of January 2, 2015, the Company has the following carryforwards available: | ||||||||||||
Jurisdiction | Tax | Amount | Begin to | |||||||||
Attribute | (in millions) | Expire | ||||||||||
International | Net Operating Loss | 48 | -1 | 2015 | ||||||||
State | Net Operating Loss | 37.6 | -1 | Various | ||||||||
U.S. and State | R&D Tax Credit | 0.7 | -1 | Various | ||||||||
State | Investment Tax Credit | 5.3 | Various | |||||||||
(1) The utilization of certain net operating losses and credits is subject to an annual limitation under Internal Revenue Code Section 382. | ||||||||||||
Certain federal tax credits reported on filed income tax returns included uncertain tax positions taken in prior years. Due to the application of the accounting for uncertain tax positions, the actual tax attributes are larger than the tax credits for which a deferred tax asset is recognized for financial statement purposes. | ||||||||||||
In assessing the realizability of deferred tax assets, management considers, within each taxing jurisdiction, whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the consideration of the weight of both positive and negative evidence, management has determined that a portion of the deferred tax assets as of January 2, 2015 and January 3, 2014 related to certain state investment tax credits and net operating losses will not be realized. | ||||||||||||
The Company files annual income tax returns in the U.S., various state and local jurisdictions, and in various foreign jurisdictions. A number of years may elapse before an uncertain tax position, for which the Company has unrecognized tax benefits, is examined and finally settled. While it is often difficult to predict the final outcome or the timing of resolution of any particular uncertain tax position, the Company believes that its unrecognized tax benefits reflect the most probable outcome. The Company adjusts these unrecognized tax benefits, as well as the related interest, in light of changing facts and circumstances. The resolution of a matter could be recognized as an adjustment to the Provision for Income Taxes and the effective tax rate in the period of resolution. | ||||||||||||
Below is a summary of changes to the unrecognized tax benefit (in thousands): | ||||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Balance, beginning of year | $ | 1,858 | $ | 970 | $ | 1,580 | ||||||
Additions based upon tax positions related to the current year | 268 | 325 | — | |||||||||
Additions related to prior period tax positions | 510 | 651 | 210 | |||||||||
Reductions relating to settlements with tax authorities | (225 | ) | (88 | ) | (522 | ) | ||||||
Reductions as a result of a lapse of applicable statute of limitations | — | — | (298 | ) | ||||||||
Balance, end of year | $ | 2,411 | $ | 1,858 | $ | 970 | ||||||
The tax years that remain open and subject to tax audits varies depending on the tax jurisdiction. An audit of the consolidated federal 2012 and 2013 tax returns were completed in the first quarter of 2015. It is reasonably possible that a reduction of approximately $1.0 million of the balance of unrecognized tax benefits may occur within the next twelve months as a result of the lapse of the statute of limitations and/or audit settlements. As of January 2, 2015, approximately $2.1 million of unrecognized tax benefits would favorably impact the effective tax rate (net of federal impact on state issues), if recognized. |
Commitments_And_Contingencies
Commitments And Contingencies | 12 Months Ended | ||||||||||||||||||
Jan. 02, 2015 | |||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||
COMMITMENTS AND CONTINGENCIES | |||||||||||||||||||
15 | COMMITMENTS AND CONTINGENCIES | ||||||||||||||||||
Litigation – On December 21, 2012, the Company and several other unaffiliated parties were named as defendants in a personal injury and wrongful death action filed in the 113th Judicial District Court of Harris County, Texas. The complaint seeks damages alleging marketing and product defects and failure to warn, negligence and gross negligence relating to a product the Company manufactured and sold to a customer, one of the other named defendants. The Company’s customer, in turn, incorporated the Greatbatch product into its own product which it sold to a third party, another named defendant. On December 3, 2014, the District Court granted the Company’s motion for summary judgment and dismissed all claims against the Company. The ruling is subject to appeal by the plaintiffs. | |||||||||||||||||||
The Company is indemnified by its customer against any loss in this matter, including costs of defense, which obligation is supported by its customer’s product liability insurance coverage in the amount of $5 million. The Company also has its own product liability insurance coverage, subject to a $10 million retention. In January 2015, Greatbatch’s customer reached a tentative, confidential settlement with the plaintiffs which, if approved by the Court, is expected to result in a release of all claims, including appeal rights, against the Company and its customer. The Company has not recorded a reserve in connection with this matter since any potential loss is not probable. | |||||||||||||||||||
The Company is a party to various other legal actions arising in the normal course of business. While the Company does not expect that the ultimate resolution of any of these pending actions will have a material effect on its consolidated results of operations, financial position, or cash flows, litigation is subject to inherent uncertainties. As such, there can be no assurance that any pending legal action, which the Company currently believes to be immaterial, does not become material in the future. | |||||||||||||||||||
License agreements – The Company is a party to various license agreements for technology that is utilized in certain of its products. The most significant of these agreements are the licenses for basic technology used in the production of wet tantalum capacitors, filtered feedthroughs and MRI compatible lead systems. Expenses related to license agreements were $3.3 million, $3.5 million and $3.1 million, for 2014, 2013 and 2012, respectively, and are included in Cost of Sales. | |||||||||||||||||||
Product Warranties – The Company generally warrants that its products will meet customer specifications and will be free from defects in materials and workmanship. The change in product warranty liability was comprised of the following (in thousands): | |||||||||||||||||||
Year Ended | |||||||||||||||||||
January 2, | January 3, | ||||||||||||||||||
2015 | 2014 | ||||||||||||||||||
Beginning balance | $ | 1,819 | $ | 2,626 | |||||||||||||||
Additions to warranty reserve | 953 | 1,624 | |||||||||||||||||
Warranty claims paid | (2,112 | ) | (2,431 | ) | |||||||||||||||
Ending balance | $ | 660 | $ | 1,819 | |||||||||||||||
Operating Leases – The Company is a party to various operating lease agreements for buildings, machinery, equipment and software. The Company primarily leases buildings, which accounts for the majority of the future lease payments. Lease expense includes the effect of escalation clauses and leasehold improvement incentives which are accounted for ratably over the lease term. Operating lease expense was as follows (in thousands): | |||||||||||||||||||
Year Ended | |||||||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||||||
2015 | 2014 | 2012 | |||||||||||||||||
Operating lease expense | $ | 4,281 | $ | 4,379 | $ | 4,024 | |||||||||||||
Minimum future estimated annual operating lease expenses are as follows (in thousands): | |||||||||||||||||||
2015 | $ | 5,797 | |||||||||||||||||
2016 | 5,952 | ||||||||||||||||||
2017 | 3,908 | ||||||||||||||||||
2018 | 3,489 | ||||||||||||||||||
2019 | 3,418 | ||||||||||||||||||
Thereafter | 13,938 | ||||||||||||||||||
Total estimated operating lease expense | $ | 36,502 | |||||||||||||||||
Self-Insured Medical Plan – The Company self-funds the medical insurance coverage provided to its U.S. based employees. The Company had specific stop loss coverage per associate for claims incurred during 2014 exceeding $225 thousand per associate with no annual maximum aggregate stop loss coverage. As of January 2, 2015 and January 3, 2014, the Company had $1.8 million and $1.6 million accrued related to the self-insurance of its medical plan, respectively. This accrual is recorded in Accrued Expenses in the Consolidated Balance Sheet, and is primarily based upon claim history. | |||||||||||||||||||
Purchase Commitments – Contractual obligations for purchase of goods or services are defined as agreements that are enforceable and legally binding on the Company and that specify all significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction. The Company’s purchase orders are normally based on its current manufacturing needs and are fulfilled by its vendors within short time horizons. The Company enters into blanket orders with vendors that have preferred pricing and terms, however these orders are normally cancelable by us without penalty. As of January 2, 2015, the total contractual obligation related to such expenditures is approximately $36.4 million and will primarily be financed by existing cash and cash equivalents, cash generated from operations, or the Credit Facility. The Company also enters into contracts for outsourced services; however, the obligations under these contracts were not significant and the contracts generally contain clauses allowing for cancellation without significant penalty. | |||||||||||||||||||
Foreign Currency Contracts – The Company has entered into forward contracts to purchase Mexican pesos in order to hedge the risk of peso-denominated payments associated with the operations at its Tijuana, Mexico facility. The impact to the Company’s results of operations from these forward contracts was as follows (in thousands): | |||||||||||||||||||
Year Ended | |||||||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||||||
2015 | 2014 | 2012 | |||||||||||||||||
Reduction in Cost of Sales | $ | (168 | ) | $ | (1,154 | ) | $ | (79 | ) | ||||||||||
Ineffective portion of change in fair value | — | — | — | ||||||||||||||||
Information regarding outstanding foreign currency contracts as of January 2, 2015 is as follows (dollars in thousands): | |||||||||||||||||||
Instrument | Type of | Aggregate | Start | End | $/Peso | Fair | Balance Sheet | ||||||||||||
Hedge | Notional | Date | Date | Value | Location | ||||||||||||||
Amount | |||||||||||||||||||
FX Contract | Cash flow | $ | 16,880 | 15-Jan | 15-Dec | 0.0734 | $ | (1,568 | ) | Accrued Expenses | |||||||||
Workers’ Compensation Trust – The Company was a member of a group self-insurance trust that provided workers’ compensation benefits to employees of the Company in Western New York (the “Trust”). Under the Trust agreement, each participating organization has joint and several liability for Trust obligations if the assets of the Trust are not sufficient to cover those obligations. During 2011, the Company was notified by the Trust of its intentions to cease operations at the end of 2011 and was assessed a pro-rata share of future costs related to the Trust. Based on actual experience, the Company could receive a refund or be assessed additional contributions for workers’ compensation claims insured by the Trust. Since 2011, the Company has utilized a traditional insurance provider for workers’ compensation coverage. |
Earnings_Loss_Per_Share
Earnings (Loss) Per Share | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Earnings Per Share [Abstract] | ||||||||||||
EARNINGS (LOSS) PER SHARE | ||||||||||||
16 | EARNINGS (LOSS) PER SHARE | |||||||||||
The following table illustrates the calculation of Basic and Diluted EPS (in thousands, except per share amounts): | ||||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Numerator for basic EPS: | ||||||||||||
Net income (loss) | $ | 55,458 | $ | 36,267 | $ | (4,799 | ) | |||||
Denominator for basic EPS: | ||||||||||||
Weighted average shares outstanding | 24,825 | 23,991 | 23,584 | |||||||||
Effect of dilutive securities: | ||||||||||||
Stock options, restricted stock and restricted stock units | 1,150 | 1,332 | — | |||||||||
Denominator for diluted EPS | 25,975 | 25,323 | 23,584 | |||||||||
Basic EPS | $ | 2.23 | $ | 1.51 | $ | (0.20 | ) | |||||
Diluted EPS | $ | 2.14 | $ | 1.43 | $ | (0.20 | ) | |||||
The diluted weighted average share calculations do not include the following securities, which are not dilutive to the EPS calculations or the performance criteria have not been met: | ||||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Time-vested stock options, restricted stock and restricted stock units | 175,549 | 18,480 | 2,142,000 | |||||||||
Performance-vested stock options and restricted stock units | — | — | 781,000 | |||||||||
For the 2013 and 2012 periods, no shares related to CSN were included in the diluted EPS calculations as the average share price of the Company’s common stock for those periods did not exceed CSN’s conversion price per share. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Income | 12 Months Ended | |||||||||||||||||||||||
Jan. 02, 2015 | ||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||||||||||||||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME | ||||||||||||||||||||||||
17 | ACCUMULATED OTHER COMPREHENSIVE INCOME | |||||||||||||||||||||||
Accumulated Other Comprehensive Income is comprised of the following (in thousands): | ||||||||||||||||||||||||
Defined | Cash | Foreign | Total | Tax | Net-of-Tax | |||||||||||||||||||
Benefit | Flow | Currency | Pre-Tax | Amount | ||||||||||||||||||||
Plan | Hedges | Translation | Amount | |||||||||||||||||||||
Liability | Adjustment | |||||||||||||||||||||||
At January 3, 2014 | $ | (672 | ) | $ | (468 | ) | $ | 14,952 | $ | 13,812 | $ | 546 | $ | 14,358 | ||||||||||
Unrealized loss on cash flow hedges | — | (2,372 | ) | — | (2,372 | ) | 829 | (1,543 | ) | |||||||||||||||
Realized gain on foreign currency hedges | — | (168 | ) | — | (168 | ) | 59 | (109 | ) | |||||||||||||||
Realized loss on interest rate swap hedges | — | 450 | — | 450 | (157 | ) | 293 | |||||||||||||||||
Net defined benefit plan liability adjustments | (509 | ) | — | — | (509 | ) | 135 | (374 | ) | |||||||||||||||
Foreign currency translation loss | — | — | (3,502 | ) | (3,502 | ) | — | (3,502 | ) | |||||||||||||||
At January 2, 2015 | $ | (1,181 | ) | $ | (2,558 | ) | $ | 11,450 | $ | 7,711 | $ | 1,412 | $ | 9,123 | ||||||||||
Defined | Cash | Foreign | Total | Tax | Net-of-Tax | |||||||||||||||||||
Benefit | Flow | Currency | Pre-Tax | Amount | ||||||||||||||||||||
Plan | Hedges | Translation | Amount | |||||||||||||||||||||
Liability | Adjustment | |||||||||||||||||||||||
At December 28, 2012 | $ | (962 | ) | $ | 120 | $ | 13,431 | $ | 12,589 | $ | 358 | $ | 12,947 | |||||||||||
Unrealized gain on cash flow hedges | — | 58 | — | 58 | (20 | ) | 38 | |||||||||||||||||
Realized gain on foreign currency hedges | — | (1,154 | ) | — | (1,154 | ) | 404 | (750 | ) | |||||||||||||||
Realized loss on interest rate swap hedges | — | 508 | — | 508 | (178 | ) | 330 | |||||||||||||||||
Net defined benefit plan liability adjustments | 290 | — | — | 290 | (18 | ) | 272 | |||||||||||||||||
Foreign currency translation gain | — | — | 1,521 | 1,521 | — | 1,521 | ||||||||||||||||||
At January 3, 2014 | $ | (672 | ) | $ | (468 | ) | $ | 14,952 | $ | 13,812 | $ | 546 | $ | 14,358 | ||||||||||
The realized (gain) loss relating to the Company’s foreign currency and interest rate swap hedges were reclassified from Accumulated Other Comprehensive Income and included in Cost of Sales and Interest Expense, respectively, in the Consolidated Statements of Operations. See Note 10 “Benefit Plans” for details on the change in defined benefit plan liability adjustments. |
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | |||||||||||||||
Jan. 02, 2015 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||
FAIR VALUE MEASUREMENTS | ||||||||||||||||
18 | FAIR VALUE MEASUREMENTS | |||||||||||||||
Assets and Liabilities Measured at Fair Value on a Recurring Basis | ||||||||||||||||
Fair value measurement standards apply to certain financial assets and liabilities that are measured at fair value on a recurring basis (each reporting period). For the Company, these financial assets and liabilities include its derivative instruments and accrued contingent consideration. The Company does not have any nonfinancial assets or liabilities that are measured at fair value on a recurring basis. | ||||||||||||||||
Foreign currency contracts – The fair value of foreign currency contracts are determined through the use of cash flow models that utilize observable market data inputs to estimate fair value. These observable market data inputs include foreign exchange rate and credit spread curves. In addition to the above, the Company received fair value estimates from the foreign currency contract counterparty to verify the reasonableness of the Company’s estimates. The Company’s foreign currency contracts are categorized in Level 2 of the fair value hierarchy. The fair value of the Company’s foreign currency contracts will be realized as Cost of Sales as the inventory, which the contracts are hedging the cash flows to produce, is sold, of which approximately $1.6 million is expected to be realized within the next twelve months. | ||||||||||||||||
Interest rate swaps – The fair value of the Company’s interest rate swaps outstanding at January 2, 2015 was determined through the use of a cash flow model that utilizes observable market data inputs. These observable market data inputs include LIBOR, swap rates, and credit spread curves. In addition to the above, the Company received a fair value estimate from the interest rate swap counterparty to verify the reasonableness of the Company’s estimate. This fair value calculation was categorized in Level 2 of the fair value hierarchy. | ||||||||||||||||
Accrued contingent consideration – The fair value of accrued contingent consideration recorded by the Company represents the estimated fair value of the contingent consideration the Company expects to pay to the former shareholders of NeuroNexus based upon the achievement of certain financial and development-based milestones. The fair value of the contingent consideration liability was estimated by discounting to present value, the probability weighted contingent payments expected to be made utilizing a risk adjusted discount rate. During the first quarter of 2014, the financial milestone expired unachieved and as a result, was determined to have a fair value of zero. During the fourth quarter of 2014, the Company determined that the development milestone will expire unachieved, and as a result, was determined to have a fair value of zero. Changes in the fair value of accrued contingent consideration were recorded in Other Operating Expenses, Net. The Company’s accrued contingent consideration is categorized in Level 3 of the fair value hierarchy. Changes in accrued contingent consideration were as follows (in thousands): | ||||||||||||||||
At December 28, 2012 | $ | 1,530 | ||||||||||||||
Fair value adjustments | (690 | ) | ||||||||||||||
At January 3, 2014 | 840 | |||||||||||||||
Fair value adjustments | (840 | ) | ||||||||||||||
At January 2, 2015 | $ | — | ||||||||||||||
The following tables provide information regarding assets and liabilities recorded at fair value on a recurring basis (in thousands): | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Description | At January 2, 2015 | Quoted | Significant | Significant | ||||||||||||
Prices in | Other | Unobservable | ||||||||||||||
Active Markets | Observable | Inputs | ||||||||||||||
for Identical | Inputs | (Level 3) | ||||||||||||||
Assets | (Level 2) | |||||||||||||||
(Level 1) | ||||||||||||||||
Liabilities | ||||||||||||||||
Foreign currency contracts (Note 15) | $ | 1,568 | $ | — | $ | 1,568 | $ | — | ||||||||
Interest rate swaps (Note 9) | 990 | — | 990 | — | ||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Description | At January 3, | Quoted | Significant | Significant | ||||||||||||
2014 | Prices in | Other | Unobservable | |||||||||||||
Active Markets | Observable | Inputs | ||||||||||||||
for Identical | Inputs | (Level 3) | ||||||||||||||
Assets | (Level 2) | |||||||||||||||
(Level 1) | ||||||||||||||||
Liabilities | ||||||||||||||||
Foreign currency contracts | $ | 140 | $ | — | $ | 140 | $ | — | ||||||||
Accrued contingent consideration | 840 | — | — | 840 | ||||||||||||
Interest rate swap | 328 | — | 328 | — | ||||||||||||
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis | ||||||||||||||||
Fair value standards also apply to certain assets and liabilities that are measured at fair value on a nonrecurring basis. The carrying amounts of cash, accounts receivable, accounts payable, accrued expenses and current portion of long-term debt approximate fair value because of the short-term nature of these items. As of January 2, 2015, the fair value of the Company’s variable rate long-term debt approximates its carrying value and is categorized in Level 2 of the fair value hierarchy. | ||||||||||||||||
A summary of the valuation methodologies for assets and liabilities measured on a nonrecurring basis is as follows: | ||||||||||||||||
Cost and equity method investments – The Company holds investments in equity and other securities that are accounted for as either cost or equity method investments, which are classified as Other Assets. The total carrying value of these investments is reviewed quarterly for changes in circumstance or the occurrence of events that suggest the Company’s investment may not be recoverable. The fair value of cost or equity method investments is not adjusted if there are no identified events or changes in circumstances that may have a material effect on the fair value of the investments. Gains and losses realized on cost and equity method investments are recorded in Other (Income) Expense, Net, unless separately stated. The aggregate recorded amount of cost and equity method investments at January 2, 2015 and January 3, 2014 was $14.5 million and $12.3 million, respectively. The Company’s equity method investment is in a Chinese venture capital fund focused on investing in life sciences companies. This fund accounts for its investments at fair value with the unrealized change in fair value of these investments recorded as income or loss to the fund in the period of change. As of January 2, 2015, the Company owned 7.4% of this fund. | ||||||||||||||||
During 2014, 2013 and 2012, the Company recognized impairment charges related to its cost method investments of $0.0 million, $0.5 million and $0.1 million, respectively. The fair value of these investments was determined by reference to recent sales data of similar shares to independent parties in an inactive market. This fair value calculation was categorized in Level 2 of the fair value hierarchy. During 2014, the Company sold one of its cost method investments, which resulted in a pre-tax gain of $3.2 million. During 2014, 2013, and 2012, the Company recognized a net gain (loss) on equity method investments of $1.2 million, $(0.2) million, and $(0.3) million, respectively. | ||||||||||||||||
Long-lived assets – The Company reviews the carrying amount of its long-lived assets to be held and used for potential impairment whenever certain indicators are present as described in Note 1 “Summary of Significant Accounting Policies.” During 2014, the Company recorded a $0.4 million impairment charge related to its Orvin, Switzerland property held for sale. The fair value of these assets were determined based upon recent sales data of similar assets and discussions with potential buyers, and was categorized in Level 2 of the fair value hierarchy. During 2013, the Company wrote off $0.5 million of IPR&D allocated to its QiG segment as these projects were discontinued prior to reaching technological feasibility. Additionally, during 2013, the Company wrote off $0.9 million of inventory and technology related to Greatbatch Medical’s wireless sensing product line held for sale, as an agreement could not be reached with potential buyers. During 2012, the Company recognized a $3.6 million impairment charge in connection with the sale of certain non-core Swiss orthopaedic product lines to an independent third party. The above impairment charges were recorded in Other Operating Expenses, Net. See Note 13 “Other Operating Expenses, Net” for further discussion. | ||||||||||||||||
The following table provides information regarding assets and liabilities recorded at fair value on a nonrecurring basis as of January 2, 2015. There were no such assets or liabilities as of January 3, 2014 (in thousands): | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Description | At January 2, 2015 | Quoted | Significant | Significant | ||||||||||||
Prices in | Other | Unobservable | ||||||||||||||
Active Markets | Observable | Inputs | ||||||||||||||
for Identical | Inputs | (Level 3) | ||||||||||||||
Assets | (Level 2) | |||||||||||||||
(Level 1) | ||||||||||||||||
Assets | ||||||||||||||||
Assets Held for Sale (Note 5) | $ | 1,635 | $ | — | $ | 1,635 | $ | — | ||||||||
Fair Value of Other Financial Instruments | ||||||||||||||||
Pension plan assets – The fair value of the Company’s pension plan assets disclosed in Note 10 “Benefit Plans” are determined based upon quoted market prices in inactive markets or valuation models with observable market data inputs to estimate fair value. These observable market data inputs include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, benchmark securities, bids, offers and reference data. The Company’s pension plan assets are categorized Level 2 of the fair value hierarchy. |
Business_Segment_Geographic_an
Business Segment, Geographic and Concentration Risk Information | 12 Months Ended | ||||||||||||||
Jan. 02, 2015 | |||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||
BUSINESS SEGMENT, GEOGRAPHIC AND CONCENTRATION RISK INFORMATION | |||||||||||||||
19 | BUSINESS SEGMENT, GEOGRAPHIC AND CONCENTRATION RISK INFORMATION | ||||||||||||||
The Company has two reportable segments: Greatbatch Medical and QiG. Greatbatch Medical designs and manufactures medical devices and components where Greatbatch either owns the intellectual property or has unique manufacturing and assembly expertise. Greatbatch Medical provides medical devices and components to the following markets: | |||||||||||||||
• | Cardiac/Neuromodulation: Products include batteries, capacitors, filtered and unfiltered feed-throughs, engineered components, implantable stimulation leads, and enclosures used in implantable medical devices. | ||||||||||||||
• | Orthopaedics: Products include implants, instruments and delivery systems for large joint, spine, extremity and trauma procedures. | ||||||||||||||
• | Portable Medical: Products include life-saving and life-enhancing applications comprising automated external defibrillators, portable oxygen concentrators, ventilators, and powered surgical tools. | ||||||||||||||
• | Vascular: Products include introducers, steerable sheaths, and catheters that deliver therapies for various markets such as coronary and neurovascular disease, peripheral vascular disease, interventional radiology, vascular access, atrial fibrillation, and interventional cardiology, plus products for medical imaging and pharmaceutical delivery. | ||||||||||||||
• | Energy, Military, Environmental: Products include primary and rechargeable batteries and battery packs for demanding applications such as down hole drilling tools. | ||||||||||||||
Greatbatch Medical also offers value-added assembly and design engineering services for medical devices that utilize its component products. | |||||||||||||||
QiG focuses on developing medical device systems for some of healthcare’s most pressing challenges and reflects Greatbatch’s strategic evolution of its product offerings in order to raise the growth and profitability profile of the Company. QiG utilizes a disciplined and diversified portfolio approach with three investment modes: new medical device systems commercialization, collaborative programs with OEM customers, and strategic equity positions in emerging healthcare companies. The development of certain new medical device systems are facilitated through the establishment of limited liability companies (“LLCs”). These LLCs do not own, but have the exclusive right to use the technology of Greatbatch in certain, specific fields of use and have an exclusive manufacturing agreement with Greatbatch Medical. QiG currently owns 89% - 100% of three LLCs. Minority interest in these LLCs are held by key opinion leaders, clinicians and strategic partners. Under the agreements governing these LLCs, QiG is responsible to fund 100% of the expenses incurred by the LLC. However, no distributions are made to the minority holders until QiG is reimbursed for all expenses paid. Once QiG has been fully reimbursed, all future distributions are made based upon the respective LLCs ownership percentages. One of the LLCs established by QiG is for the Company’s Algovita spinal cord stimulator to treat chronic intractable pain of the trunk and/or limbs. This product was submitted for premarket approval (“PMA”) to the United States Food & Drug Administration (“FDA”) in December 2013 and in January 2014 documentation for European CE Mark was submitted to the notified body, TÜV SÜD America. CE Mark approval was obtained on June 17, 2014. | |||||||||||||||
QiG revenue includes sales of neural interface technology, components and systems to the neuroscience and clinical markets. As further discussed in Note 2 “Acquisitions,” during 2014, the Company acquired CCC, a neuromodulation medical device developer and manufacturer. As a result of this transaction, QiG revenue also includes sales of various medical device products such as implantable pulse generators, programmer systems, battery chargers, patient wands and leads to medical device companies. Future income of QiG is expected to come from various sources including investment gains from the sales of its LLC ownership interests, technology licensing fees, royalty revenue, and/or the sales of medical device systems. | |||||||||||||||
An analysis and reconciliation of the Company’s business segment, product line and geographic information to the respective information in the Consolidated Financial Statements follows. Intersegment sales between Greatbatch Medical and QiG were not material for 2014, 2013 or 2012. Sales by geographic area are presented by allocating sales from external customers based on where the products are shipped to (in thousands): | |||||||||||||||
Year Ended | |||||||||||||||
Sales: | January 2, | January 3, | December 28, | ||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Greatbatch Medical | |||||||||||||||
Cardiac/Neuromodulation | $ | 321,419 | $ | 325,412 | $ | 306,669 | |||||||||
Orthopaedics | 147,296 | 130,247 | 122,061 | ||||||||||||
Portable Medical | 69,043 | 78,743 | 81,659 | ||||||||||||
Vascular | 58,770 | 48,357 | 51,980 | ||||||||||||
Energy, Military, Environmental | 81,757 | 78,143 | 81,353 | ||||||||||||
Total Greatbatch Medical | 678,285 | 660,902 | 643,722 | ||||||||||||
QiG | 9,502 | 3,043 | 2,455 | ||||||||||||
Total sales | $ | 687,787 | $ | 663,945 | $ | 646,177 | |||||||||
Year Ended | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Segment income (loss) from operations: | |||||||||||||||
Greatbatch Medical | $ | 126,312 | $ | 111,805 | $ | 79,093 | |||||||||
QiG | (23,256 | ) | (30,484 | ) | (32,554 | ) | |||||||||
Total segment income from operations | 103,056 | 81,321 | 46,539 | ||||||||||||
Unallocated operating expenses | (27,402 | ) | (19,982 | ) | (20,718 | ) | |||||||||
Operating income as reported | 75,654 | 61,339 | 25,821 | ||||||||||||
Unallocated other income (expense), net | 925 | (12,501 | ) | (19,091 | ) | ||||||||||
Income before provision for income taxes as reported | $ | 76,579 | $ | 48,838 | $ | 6,730 | |||||||||
Year Ended | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Depreciation and Amortization: | |||||||||||||||
Greatbatch Medical | $ | 31,906 | $ | 31,112 | $ | 39,820 | |||||||||
QiG | 2,101 | 1,539 | 630 | ||||||||||||
Total depreciation and amortization included in segment income from operations | 34,007 | 32,651 | 40,450 | ||||||||||||
Unallocated depreciation and amortization | 4,223 | 9,681 | 18,475 | ||||||||||||
Total depreciation and amortization | $ | 38,230 | $ | 42,332 | $ | 58,925 | |||||||||
Year Ended | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Expenditures for tangible long-lived assets, excluding acquisitions: | |||||||||||||||
Greatbatch Medical | $ | 19,006 | $ | 13,242 | $ | 33,249 | |||||||||
QiG | 1,453 | 2,134 | 3,208 | ||||||||||||
Total reportable segments | 20,459 | 15,376 | 36,457 | ||||||||||||
Unallocated long-lived tangible assets | 5,187 | 2,798 | 4,709 | ||||||||||||
Total expenditures | $ | 25,646 | $ | 18,174 | $ | 41,166 | |||||||||
At | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Identifiable assets: | |||||||||||||||
Greatbatch Medical | $ | 761,225 | $ | 758,369 | $ | 779,890 | |||||||||
QiG | 76,529 | 56,245 | 57,750 | ||||||||||||
Total reportable segments | 837,754 | 814,614 | 837,640 | ||||||||||||
Unallocated assets | 118,255 | 76,089 | 52,235 | ||||||||||||
Total assets | $ | 956,009 | $ | 890,703 | $ | 889,875 | |||||||||
Year Ended | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Sales by geographic area: | |||||||||||||||
United States | $ | 312,539 | $ | 325,090 | $ | 330,537 | |||||||||
Non-Domestic locations: | |||||||||||||||
Puerto Rico | 127,702 | 117,961 | 105,731 | ||||||||||||
Belgium | 65,308 | 67,155 | 58,043 | ||||||||||||
Rest of world | 182,238 | 153,739 | 151,866 | ||||||||||||
Total sales | $ | 687,787 | $ | 663,945 | $ | 646,177 | |||||||||
At | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Long-lived tangible assets: | |||||||||||||||
United States | $ | 113,851 | $ | 116,484 | $ | 123,104 | |||||||||
Rest of world | 31,074 | 29,289 | 27,789 | ||||||||||||
Total | $ | 144,925 | $ | 145,773 | $ | 150,893 | |||||||||
A significant portion of the Company’s sales and accounts receivable were to four customers as follows: | |||||||||||||||
Sales | Accounts Receivable | ||||||||||||||
Year Ended | At | ||||||||||||||
January 2, | January 3, | December 28, | January 2, | January 3, | |||||||||||
2015 | 2014 | 2012 | 2015 | 2014 | |||||||||||
Customer A | 18 | % | 20 | % | 19 | % | 4 | % | 8 | % | |||||
Customer B | 18 | % | 16 | % | 16 | % | 23 | % | 19 | % | |||||
Customer C | 12 | % | 13 | % | 11 | % | 8 | % | 8 | % | |||||
Customer D | 6 | % | 7 | % | 6 | % | 12 | % | 11 | % | |||||
54 | % | 56 | % | 52 | % | 47 | % | 46 | % |
Quarterly_Sales_and_Earnings_D
Quarterly Sales and Earnings Data - Unaudited | 12 Months Ended | |||||||||||||||
Jan. 02, 2015 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||
QUARTERLY SALES AND EARNINGS DATA - UNAUDITED | ||||||||||||||||
20 | QUARTERLY SALES AND EARNINGS DATA—UNAUDITED | |||||||||||||||
4th Qtr. | 3rd Qtr. | 2nd Qtr. | 1st Qtr. | |||||||||||||
(in thousands, except per share data) | ||||||||||||||||
2014 | ||||||||||||||||
Sales | $ | 169,726 | $ | 171,699 | $ | 172,081 | $ | 174,281 | ||||||||
Gross profit | 57,214 | 58,118 | 58,470 | 57,596 | ||||||||||||
Net income | 14,176 | 14,012 | 12,348 | 14,922 | ||||||||||||
EPS—basic | 0.57 | 0.56 | 0.5 | 0.61 | ||||||||||||
EPS—diluted | 0.54 | 0.54 | 0.48 | 0.58 | ||||||||||||
2013 | ||||||||||||||||
Sales | $ | 176,619 | $ | 167,730 | $ | 171,331 | $ | 148,265 | ||||||||
Gross profit | 57,385 | 55,877 | 57,302 | 48,749 | ||||||||||||
Net income | 9,781 | 11,071 | 9,752 | 5,663 | ||||||||||||
EPS—basic | 0.4 | 0.46 | 0.41 | 0.24 | ||||||||||||
EPS—diluted | 0.38 | 0.44 | 0.39 | 0.23 | ||||||||||||
Fourth quarter results for 2013 includes an additional week of operations in comparison to the same period of 2014 as the Company utilizes a fifty-two, fifty-three week fiscal year, which ends on the Friday nearest December 31st. Although this additional week of operations may have impacted certain financial statement line items, management believes that, when combined with the additional holiday and weather related shutdowns, this additional week did not materially impact the Company’s net operating results. |
Valuation_and_Qualifying_Accou
Valuation and Qualifying Accounts | 12 Months Ended | ||||||||||||||||||||||
Jan. 02, 2015 | |||||||||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | |||||||||||||||||||||||
Schedule of Valuation and Qualifying Accounts Disclosure | Schedule II—Valuation and Qualifying Accounts | ||||||||||||||||||||||
Col. C—Additions | |||||||||||||||||||||||
Col. A | Col. B Balance at Beginning | Charged to Costs & | Charged to Other Accounts- Describe | Col. D Deductions | Col. E Balance at End of | ||||||||||||||||||
Description | of Period | Expenses | - Describe | Period | |||||||||||||||||||
2-Jan-15 | |||||||||||||||||||||||
Allowance for doubtful accounts | $ | 2,001 | $ | 98 | $ | 14 | (3)(4) | $ | (702 | ) | (2) | $ | 1,411 | ||||||||||
Valuation allowance for deferred income tax assets | $ | 11,661 | $ | (729 | ) | (1) | $ | — | (4) | $ | (223 | ) | (1)(5) | $ | 10,709 | ||||||||
3-Jan-14 | |||||||||||||||||||||||
Allowance for doubtful accounts | $ | 2,372 | $ | (93 | ) | $ | (15 | ) | (4) | $ | (263 | ) | (2) | $ | 2,001 | ||||||||
Valuation allowance for deferred income tax assets | $ | 12,768 | $ | (1,263 | ) | (1) | $ | 32 | (4) | $ | 124 | (1) | $ | 11,661 | |||||||||
28-Dec-12 | |||||||||||||||||||||||
Allowance for doubtful accounts | $ | 1,930 | $ | 484 | $ | 71 | (3)(4) | $ | (113 | ) | (2) | $ | 2,372 | ||||||||||
Valuation allowance for deferred income tax assets | $ | 7,775 | $ | 5,145 | (1) | $ | 124 | (4) | $ | (276 | ) | (5) | $ | 12,768 | |||||||||
(1) | Valuation allowance recorded in the provision for income taxes for certain net operating losses and tax credits. The net decrease in allowance in 2014 and 2013 primarily relates to the use of net operating loss carryforwards. | ||||||||||||||||||||||
(2) | Accounts written off. | ||||||||||||||||||||||
(3) | Balance recorded as a part of our 2014 acquisition of Centro de Construcción de Cardioestimuladores del Uruguay and our 2012 acquisition of NeuroNexus Technologies, Inc. | ||||||||||||||||||||||
(4) | Includes foreign currency translation effect. | ||||||||||||||||||||||
(5) | Primarily relates to return to provision adjustments for prior years. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 02, 2015 | |
Accounting Policies [Abstract] | |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation – The consolidated financial statements include the accounts of Greatbatch, Inc. and its wholly owned subsidiary Greatbatch Ltd. (collectively, the “Company” or “Greatbatch”). All intercompany balances and transactions have been eliminated in consolidation. |
Fair Value Measurements | Fair Value Measurements – Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e. the “exit price”) in an orderly transaction between market participants at the measurement date. Accounting Standards Codification (“ASC”) establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows: |
Level 1 – Valuation is based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Level 1 valuations do not entail a significant degree of judgment. | |
Level 2 – Valuation is determined from quoted prices for similar assets or liabilities in active markets, quoted prices for identical instruments in markets that are not active or by model-based techniques in which all significant inputs are observable in the market. | |
Level 3 – Valuation is based on unobservable inputs that are significant to the overall fair value measurement. The degree of judgment in determining fair value is greatest for Level 3 valuations. | |
The availability of observable inputs can vary and is affected by a wide variety of factors, including, the type of asset/liability, whether the asset/liability is established in the marketplace, and other characteristics particular to the valuation. To the extent that a valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. | |
Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, assumptions are required to reflect those that market participants would use in pricing the asset or liability at the measurement date. Note 18 “Fair Value Measurements” contains additional information on assets and liabilities recorded at fair value in the consolidated financial statements. | |
Cash and Cash Equivalents | Cash and Cash Equivalents – Cash and cash equivalents consist of cash and highly liquid, short-term investments with maturities at the time of purchase of three months or less. The carrying amount of cash and cash equivalents approximated their fair value as of January 2, 2015 and January 3, 2014 based upon the short-term nature of these instruments. |
Concentration of Credit Risk | Concentration of Credit Risk – Financial instruments that potentially subject the Company to concentration of credit risk consist principally of accounts receivable. A significant portion of the Company’s sales and/or accounts receivable are to four customers, all in the medical device industry, and, as such, the Company is directly affected by the condition of those customers and that industry. However, the credit risk associated with trade receivables is partially mitigated due to the stability of those customers. The Company performs on-going credit evaluations of its customers. Note 19 “Business Segment, Geographic and Concentration Risk Information” contains information on sales and accounts receivable for these customers. The Company maintains cash deposits with major banks, which from time to time may exceed insured limits. The Company performs on-going credit evaluations of its banks. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts – The Company provides credit, in the normal course of business, to its customers in the form of trade receivables. Credit is extended based on evaluation of a customer’s financial condition and collateral is not required. The Company maintains an allowance for those customer receivables that it does not expect to collect. The Company accrues its estimated losses from uncollectable accounts receivable to the allowance based upon recent historical experience, the length of time the receivable has been outstanding and other specific information as it becomes available. Provisions to the allowance for doubtful accounts are charged to current operating expenses. Actual losses are charged against this allowance when incurred. The carrying amount of trade receivables approximated their fair value as of January 2, 2015 based upon the short-term nature of these assets. |
Inventories | Inventories – Inventories are stated at the lower of cost, determined using the first-in first-out method, or market. Write-downs for excess, obsolete or expired inventory are based primarily on how long the inventory has been held as well as estimates of forecasted net sales of that product. A significant change in the timing or level of demand for products may result in recording additional write-downs for excess, obsolete or expired inventory in the future. Note 4 “Inventories” contains additional information on the Company’s inventory. |
Property, Plant and Equipment | Property, Plant and Equipment (“PP&E”) – PP&E is carried at cost less accumulated depreciation. Depreciation is computed by the straight-line method over the estimated useful lives of the assets, as follows: buildings and building improvements 7-40 years; machinery and equipment 3-8 years; office equipment 3-10 years; and leasehold improvements over the remaining lives of the improvements or the lease term, if less. The cost of repairs and maintenance are expensed as incurred; renewals and betterments are capitalized. Upon retirement or sale of an asset, its cost and related accumulated depreciation or amortization is removed from the accounts and any gain or loss is recorded in operating income or expense. Note 6 “Property, Plant and Equipment, Net” contains additional information on the Company’s PP&E. |
Business Combinations | Business Combinations – The Company records its business combinations under the acquisition method of accounting. Under the acquisition method of accounting, the Company allocates the purchase price of each acquisition to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective fair values at the date of acquisition. The fair value of identifiable intangible assets is based upon detailed valuations that use various assumptions made by management. Any excess of the purchase price over the fair value of net tangible and identifiable intangible assets acquired is allocated to goodwill. All direct acquisition-related costs are expensed as incurred. |
In circumstances where an acquisition involves a contingent consideration arrangement, the Company recognizes a liability equal to the fair value of the contingent payments it expects to make as of the acquisition date. The Company re-measures this liability each reporting period and records changes in the fair value through Other Operating Expenses, Net. Increases or decreases in the fair value of the contingent consideration liability can result from changes in discount periods and rates, as well as changes in the timing, amount of, or the likelihood of achieving the applicable contingent consideration. See Note 18 “Fair Value Measurements” and Note 2 “Acquisitions” for additional information on the Company’s contingent consideration and acquisitions, respectively. | |
Amortizing Intangible Assets | Amortizing Intangible Assets – Amortizing intangible assets consists primarily of purchased technology, patents and customer lists. The Company amortizes its definite-lived intangible assets over their estimated useful lives utilizing an accelerated or straight-line method of amortization, which approximates the projected cash flows used to fair value those intangible assets at the time of acquisition. When the straight-line method of amortization is utilized, the estimated useful life of the intangible asset is shortened to assure that recognition of amortization expense corresponds with the expected cash flows. The amortization period for the Company’s amortizing intangible assets are as follows: purchased technology and patents 5-15 years; customer lists 7-20 years and other intangible assets 1-10 years. See Note 7 “Intangible Assets” for additional information on the Company’s amortizing intangible assets. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets – The Company assesses the impairment of definite-lived long-lived assets or asset groups when events or changes in circumstances indicate that the carrying value may not be recoverable. Factors that are considered in deciding when to perform an impairment review include: a significant decrease in the market price of the asset or asset group; a significant change in the extent or manner in which a long-lived asset or asset group is being used or in its physical condition; a significant change in legal factors or in the business climate that could affect the value of a long-lived asset or asset group, including an action or assessment by a regulator; an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction; a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset or asset group; or a current expectation that, more likely than not, a long-lived asset or asset group will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. The term more likely than not refers to a level of likelihood that is more than 50 percent. |
Potential recoverability is measured by comparing the carrying amount of the asset or asset group to its related total future undiscounted cash flows. If the carrying value is not recoverable, the asset or asset group is considered to be impaired. Impairment is measured by comparing the asset or asset group’s carrying amount to its fair value. When it is determined that useful lives of assets are shorter than originally estimated, and no impairment is present, the rate of depreciation is accelerated in order to fully depreciate the assets over their new shorter useful lives. | |
Goodwill and Intangible Assets | Goodwill and other indefinite lived intangible assets recorded are not amortized but are periodically tested for impairment. The Company assesses goodwill for impairment on the last day of each fiscal year, or more frequently if certain events occur as described above. Goodwill is evaluated for impairment through the comparison of the fair value of the reporting units to their carrying values. When evaluating goodwill for impairment, the Company may first perform an assessment of qualitative factors to determine if the fair value of the reporting unit is more-likely-than-not greater than its carrying amount. This qualitative assessment is referred to as a “step zero” approach. If, based on the review of the qualitative factors, the Company determines it is more-likely-than-not that the fair value of the reporting unit is greater than its carrying value, the required two-step impairment test can be bypassed. If the Company does not perform a step zero assessment or if the fair value of the reporting unit is more-likely-than-not less than its carrying value, the Company must perform a two-step impairment test, and calculate the estimated fair value of the reporting unit. If, based upon the two-step impairment test, it is determined that the fair value of a reporting unit is less than its carrying value, an impairment loss is recorded to the extent that the implied fair value of the goodwill within the reporting unit is less than its carrying value. Under the two-step approach, fair values for reporting units are determined based on discounted cash flows and market multiples. |
The Company completed its annual goodwill impairment assessment for 2014 by performing a step zero qualitative analysis. As part of this analysis, the Company evaluated factors including, but not limited to, macro-economic conditions, market and industry conditions, cost factors, competitive environment, share price fluctuations, results of the last impairment test, and the operational stability and the overall financial performance of the reporting units. After completing the analysis, the Company determined that it was more likely than not that its reporting units fair values are greater than the reporting units carrying values and the two-step impairment test is not necessary. | |
Other indefinite lived intangible assets are assessed for impairment on the last day of each fiscal year, or more frequently if certain events occur as described above, by comparing the fair value of the intangible asset to its carrying value. The fair value is determined by using the income approach. Note 7 “Intangible Assets” contains additional information on the Company’s long-lived intangible assets. | |
Other Long-Term Assets | Other Long-Term Assets – Other long-term assets includes deferred financing fees incurred in connection with the Company’s issuance of its long-term debt. The fees relating to the Company’s Term Loan are amortized to Interest Expense using the effective interest method over the period from the date of issuance to the put option date (if applicable) or the maturity date, whichever is earlier. Fees relating to the Company’s Revolving Credit Facility are amortized to Interest Expense on a straight-line basis over the contractual term of the credit facility. The amortization of deferred fees is included in Debt Related Amortization Included in Interest Expense in the Consolidated Statements of Cash Flows. Note 9 “Debt” contains additional information on the Company’s deferred financing fees. |
Cost And Equity Method Investments | Other long-term assets also include investments in equity securities of entities that are not publicly traded and which do not have readily determinable fair values. The Company accounts for investments in these entities under the cost or equity method depending on the type of ownership interest, as well as the Company’s ability to exercise influence over these entities. Equity method investments are initially recorded at cost, and are subsequently adjusted to reflect the Company’s share of earnings or losses of the investee. Cost method investments are recorded at cost. Each reporting period, management evaluates these cost and equity method investments to determine if there are any events or circumstances that are likely to have a significant effect on the fair value of the investment. Examples of such impairment indicators include, but are not limited to: a recent sale or offering of similar shares of the investment at a price below the Company’s cost basis; a significant deterioration in earnings performance; a significant change in the regulatory, economic or technological environment of the investee; or a significant doubt about an investee’s ability to continue as a going concern. If an impairment indicator is identified, management will estimate the fair value of the investment and compare it to its carrying value. The estimation of fair value considers all available financial information related to the investee, including, but not limited to, valuations based on recent third-party equity investments in the investee. If the fair value of the investment is less than its carrying value, the investment is impaired and a determination as to whether the impairment is other-than-temporary is made. Impairment is deemed to be other-than-temporary unless the Company has the ability and intent to hold the investment for a period sufficient for a market recovery up to the carrying value of the investment. Further, evidence must indicate that the carrying value of the investment is recoverable within a reasonable period. For other-than-temporary impairments, an impairment loss is recognized equal to the difference between the investment’s carrying value and its fair value. The Company has determined that these investments are not considered variable interest entities. The Company’s exposure related to these entities is limited to its recorded investment. These investments are in start-up research and development companies whose fair value is highly subjective in nature and subject to future fluctuations, which could be significant. |
Income Taxes | Income Taxes – The consolidated financial statements of the Company have been prepared using the asset and liability approach in accounting for income taxes, which requires the recognition of deferred income taxes for the expected future tax consequences of net operating losses, credits, and temporary differences between the financial statement carrying amounts and the tax bases of assets and liabilities. A valuation allowance is provided on deferred tax assets if it is determined that it is more likely than not that the asset will not be realized. |
The Company accounts for uncertain tax positions using a more likely than not recognition threshold. The evaluation of uncertain tax positions is based on factors including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective settlement of matters subject to audit, new audit activity and changes in facts or circumstances related to a tax position. These tax positions are evaluated on a quarterly basis. The Company recognizes interest expense related to uncertain tax positions as Provision for Income Taxes. Penalties, if incurred, are recognized as a component of Selling, General and Administrative Expenses (“SG&A”). | |
The Company and its subsidiary file a consolidated U.S. federal income tax return. State tax returns are filed on a combined or separate basis depending on the applicable laws in the jurisdictions where tax returns are filed. The Company also files foreign tax returns on a separate company basis in the countries in which it operates. See Note 14 “Income Taxes” for additional information. | |
Convertible Subordinated Notes | Convertible Subordinated Notes (“CSN”) – For convertible debt instruments that may be settled in cash upon conversion, the Company accounts for the liability and equity components of those instruments in a manner that will reflect the entity’s nonconvertible debt borrowing rate when interest cost is recognized in subsequent periods. |
Upon issuance, the Company determined the carrying amount of the liability component of CSN by measuring the fair value of a similar liability that does not have the associated conversion option. The carrying amount of the conversion option was then determined by deducting the fair value of the liability component from the initial proceeds received from the issuance of CSN. The carrying amount of the conversion option was recorded in Additional Paid-In Capital with an offset to Long-Term Debt and was amortized using the effective interest method over the period from the date of issuance to the maturity date. The amortization of discount related to the Company’s convertible debt instruments is included in Debt Related Amortization Included in Interest Expense in the Consolidated Statements of Cash Flows. See Note 9 “Debt” for additional information. | |
Derivative Financial Instruments | Derivative Financial Instruments – The Company recognizes all derivative financial instruments in its consolidated financial statements at fair value. Changes in the fair value of derivative instruments are recorded in earnings unless hedge accounting criteria are met. The Company designates its interest rate swaps (See Note 9 “Debt”) and foreign currency contracts (See Note 15 “Commitments and Contingencies”) entered into as cash flow hedges. The effective portion of the changes in fair value of these cash flow hedges is recorded each period, net of tax, in Accumulated Other Comprehensive Income until the related hedged transaction occurs. Any ineffective portion of the changes in fair value of these cash flow hedges is recorded in earnings. In the event the hedged cash flow for forecasted transactions does not occur, or it becomes probable that they will not occur, the Company would reclassify the amount of any gain or loss on the related cash flow hedge to income (expense) at that time. Cash flows related to these derivative financial instruments are included in cash flows from operating activities. |
Revenue Recognition | Revenue Recognition – The Company recognizes revenue when it is realized or realizable and earned. This occurs when persuasive evidence of an arrangement exists, delivery has occurred, the price is fixed or determinable (including any price concessions under long-term agreements), the buyer is obligated to pay us (i.e., not contingent on a future event), the risk of loss is transferred, there is no obligation of future performance, collectability is reasonably assured and the amount of future returns can reasonably be estimated. With regards to the Company’s customers (including distributors), those criteria are met at the time of shipment when title passes. Currently, the revenue recognition policy is the same for both Greatbatch Medical and QiG. In general, for customers with long-term contracts, we have negotiated fixed pricing arrangements. During new contract negotiations, price level decreases (concessions) for future sales may be offered to customers in exchange for volume and/or long-term commitments. Once the new contracts are signed, these prices are fixed and determinable for all future sales. The Company includes shipping and handling fees billed to customers in Sales. Shipping and handling costs associated with inbound and outbound freight are recorded in Cost of Sales. In certain instances the Company obtains component parts for sub-assemblies from its customers that are included in the final product sold back to the same customer. These amounts are excluded from Sales and Cost of Sales recognized by the Company. |
Product Warranties | Product Warranties – The Company allows customers to return defective or damaged products for credit, replacement, or exchange. The Company warrants that its products will meet customer specifications and will be free from defects in materials and workmanship. The Company accrues its estimated exposure to warranty claims, through Cost of Sales, based upon recent historical experience and other specific information as it becomes available. Note 15 “Commitments and Contingencies” contains additional information on the Company’s product warranties. |
Research, Development and Engineering Costs, Net | Research, Development and Engineering Costs, Net (“RD&E”) – RD&E costs are expensed as incurred. The primary costs are salary and benefits for personnel, material costs used in development projects and subcontracting costs. Cost reimbursements for engineering services from customers for whom the Company designs products are recorded as an offset to engineering costs upon achieving development milestones specified in the contracts. These reimbursements do not cover the complete cost of the development projects. Additionally, the technology developed under these cost reimbursement projects is owned by the Company and is utilized for future products developed for other customers. |
In-process research and development (“IPR&D”) represents research projects acquired in a business combination which are expected to generate cash flows but have not yet reached technological feasibility. The primary basis for determining the technological feasibility of these projects is whether or not regulatory approval has been obtained. The Company classifies IPR&D acquired in a business combination as an indefinite-lived intangible asset until the completion or abandonment of the associated projects. Upon completion, the Company would determine the useful life of the IPR&D and begin amortizing the assets to reflect their use over their remaining lives. Upon permanent abandonment, the remaining carrying amount of the associated IPR&D would be written-off. The Company tests the IPR&D acquired for impairment at least annually, and more frequently if events or changes in circumstances indicate that the assets may be impaired. The impairment test consists of a comparison of the fair value of the intangible assets with their carrying amount. If the carrying amount exceeds its fair value, the Company would record an impairment loss in an amount equal to the excess. | |
Note 12 “Research, Development and Engineering Costs, Net” contains additional information on the Company’s RD&E activities. | |
Stock-Based Compensation | Stock-Based Compensation – The Company records compensation costs related to stock-based awards granted to employees based upon their estimated fair value on the grant date. Compensation cost for service-based awards is recognized ratably over the applicable vesting period. Compensation cost for nonmarket-based performance awards is reassessed each period and recognized based upon the probability that the performance targets will be achieved. Compensation cost for market-based performance awards is expensed ratably over the applicable vesting period and is recognized each period whether the performance metrics are achieved or not. |
The Company utilizes the Black-Scholes option pricing model to estimate the fair value of stock options granted. For service-based and nonmarket-based performance restricted stock and restricted stock unit awards, the fair market value of the award is determined based upon the closing value of the Company’s stock price on the grant date. For market-based performance restricted stock unit awards, the fair market value of the award is determined utilizing a Monte Carlo simulation model, which projects the value of the Company’s stock under numerous scenarios and determines the value of the award based upon the present value of those projected outcomes. | |
The amount of stock-based compensation expense recognized is based on the portion of the awards that are ultimately expected to vest. The Company estimates pre-vesting forfeitures at the time of grant by analyzing historical data and revises those estimates in subsequent periods if actual forfeitures differ from those estimates. The total expense recognized over the vesting period will only be for those awards that ultimately vest, excluding market and nonmarket performance award considerations. Note 11 “Stock-Based Compensation” contains additional information on the Company’s stock-based compensation. | |
Foreign Currency Translation | Foreign Currency Translation – The Company translates all assets and liabilities of its foreign subsidiaries, where the U.S. dollar is not the functional currency, at the period-end exchange rate and translates income and expenses at the average exchange rates in effect during the period. The net effect of this translation is recorded in the consolidated financial statements as Accumulated Other Comprehensive Income. Translation adjustments are not adjusted for income taxes as they relate to permanent investments in the Company’s foreign subsidiaries. |
Defined Benefit Plans | Defined Benefit Plans – The Company recognizes in its balance sheet as an asset or liability the overfunded or underfunded status of its defined benefit plans provided to its employees located in Mexico, Switzerland and France. This asset or liability is measured as the difference between the fair value of plan assets and the benefit obligation of those plans. For these plans, the benefit obligation is the projected benefit obligation, which is calculated based on actuarial computations of current and future benefits for employees. Actuarial gains or losses and prior service costs or credits that arise during the period, but are not included as components of net periodic benefit expense, are recognized as a component of Accumulated Other Comprehensive Income. Defined benefit expenses are charged to Cost of Sales, SG&A and RD&E expenses as applicable. Note 10 “Benefit Plans” contains additional information on these costs. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share (“EPS”) – Basic EPS is calculated by dividing Net Income (Loss) by the weighted average number of shares outstanding during the period. Diluted EPS is calculated by adjusting the weighted average number of shares outstanding for potential common shares, which consist of stock options, unvested restricted stock and restricted stock units and, if applicable, contingently convertible instruments such as convertible debt. Note 16 “Earnings (Loss) Per Share” contains additional information on the computation of the Company’s EPS. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) – The Company’s comprehensive income (loss) as reported in the Consolidated Statements of Operations and Comprehensive Income (Loss) includes net income (loss), foreign currency translation adjustments, the net change in cash flow hedges, and defined benefit plan liability adjustments. The Consolidated Statements of Operations and Comprehensive Income (Loss) and Note 17 “Accumulated Other Comprehensive Income” contains additional information on the computation of the Company’s comprehensive income (loss). |
Use of Estimates | Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of sales and expenses during the reporting period. Actual results could differ materially from those estimates. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements – In the normal course of business, management evaluates all new accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”), Securities and Exchange Commission (“SEC”), Emerging Issues Task Force (“EITF”), or other authoritative accounting bodies to determine the potential impact they may have on the Company’s Consolidated Financial Statements. Based upon this review, except as noted below, management does not expect any of the recently issued accounting pronouncements, which have not already been adopted, to have a material impact on the Company’s Consolidated Financial Statements. |
In November 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-17, “Business Combinations (Topic 805): Pushdown Accounting (a Consensus of the FASB Emerging Issues Task Force).” The amendments in this ASU provide an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. An acquired entity may elect the option to apply pushdown accounting in the reporting period in which the change-in-control event occurs. The amendments in this ASU are effective on November 18, 2014. After the effective date, an acquired entity can make an election to apply the guidance to future change-in-control events or to its most recent change-in-control event. This ASU did not impact the Company’s Consolidated Financial Statements. | |
In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers.” The core principle behind ASU 2014-09 is that an entity should recognize revenue in an amount that reflects the consideration to which the entity expects to be entitled in exchange for delivering goods and services. This model involves a five-step process that includes identifying the contract with the customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations in the contract and recognizing revenue when the entity satisfies the performance obligations. This ASU supersedes existing revenue recognition guidance and is effective for annual reporting periods beginning after December 15, 2016 with early application not permitted. This ASU allows two methods of adoption; a full retrospective approach where three years of financial information are presented in accordance with the new standard, and a modified retrospective approach where this ASU is applied to the most current period presented in the financial statements. The Company is currently assessing the financial impact of adopting the new standard and the methods of adoption; however, given the scope of the new standard, the Company is currently unable to provide a reasonable estimate regarding the financial impact or which method of adoption will be elected. | |
In April 2014, the FASB issued ASU No. 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,” which amends the definition of a discontinued operation and requires entities to provide additional disclosures about disposal transactions that do not meet the discontinued operations criteria. The revised guidance changes how entities identify and disclose information about disposal transactions under U.S. GAAP. This ASU is effective prospectively for all disposals (except disposals classified as held for sale before the adoption date) or components initially classified as held for sale in periods beginning on or after December 15, 2014, with early adoption permitted. This ASU will be applicable for disposal transactions, if any, that the Company enters into after the adoption date. | |
In July 2013, the FASB issued ASU No. 2013-11, “Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” This ASU requires that entities present an unrecognized tax benefit, or portion of an unrecognized tax benefit, as a reduction to a deferred tax asset in the financial statements for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, with certain exceptions. This ASU was adopted during the first quarter of 2014 and did not impact the Company’s Consolidated Financial Statements as the Company does not have any net operating loss carryforward deferred tax assets that are eligible to be reduced by an unrecognized tax benefit as required by the ASU. |
Acquisitions_Tables
Acquisitions (Tables) | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Schedule of Pro Forma Information | The following unaudited pro forma information presents the consolidated results of operations of the Company, CCC, and NeuroNexus as if those acquisitions occurred as of the beginning of fiscal years 2013 (CCC) and 2011 (NeuroNexus) (in thousands, except per share amounts): | |||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Sales | $ | 696,357 | $ | 677,657 | $ | 646,617 | ||||||
Net income (loss) | 56,453 | 37,612 | (4,973 | ) | ||||||||
Earnings (loss) per share: | ||||||||||||
Basic | $ | 2.27 | $ | 1.57 | $ | (0.21 | ) | |||||
Diluted | $ | 2.17 | $ | 1.49 | $ | (0.21 | ) | |||||
Centro De Construccion De Cardioestimuladores Del Uruguay [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Schedule of Business Acquisitions, by Acquisition | The following table summarizes the preliminary allocation of the CCC purchase price to the assets acquired and liabilities assumed as of the acquisition date (in thousands): | |||||||||||
Assets acquired | ||||||||||||
Current assets | $ | 10,670 | ||||||||||
Property, plant and equipment | 1,131 | |||||||||||
Amortizing intangible assets | 6,100 | |||||||||||
Goodwill | 8,296 | |||||||||||
Total assets acquired | 26,197 | |||||||||||
Liabilities assumed | ||||||||||||
Current liabilities | 4,842 | |||||||||||
Deferred income taxes | 1,590 | |||||||||||
Total liabilities assumed | 6,432 | |||||||||||
Net assets acquired | $ | 19,765 | ||||||||||
Schedule of Acquired Finite-Lived Intangible Assets by Major Class | Intangible assets – The purchase price was allocated to intangible assets as follows (dollars in thousands): | |||||||||||
Amortizing Intangible Assets | Fair | Weighted | Weighted | |||||||||
Value | Average | Average | ||||||||||
Assigned | Amortization | Discount | ||||||||||
Period (Years) | Rate | |||||||||||
Technology | $ | 1,400 | 10 | 18% | ||||||||
Customer lists | 4,600 | 10 | 18% | |||||||||
Trademarks and tradenames | 100 | 2 | 18% | |||||||||
$ | 6,100 | 10 | 18% | |||||||||
Neuro Nexus Technologies Inc [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Schedule of Business Acquisitions, by Acquisition | The following table summarizes the allocation of the NeuroNexus purchase price to the assets acquired and liabilities assumed as of the acquisition date (in thousands): | |||||||||||
Assets acquired | ||||||||||||
Current assets | $ | 618 | ||||||||||
Property, plant and equipment | 35 | |||||||||||
Amortizing intangible assets | 2,927 | |||||||||||
Indefinite-lived intangible assets | 540 | |||||||||||
Goodwill | 8,924 | |||||||||||
Other assets | 1,576 | |||||||||||
Total assets acquired | 14,620 | |||||||||||
Liabilities assumed | ||||||||||||
Current liabilities | 420 | |||||||||||
Deferred income taxes | 989 | |||||||||||
Total liabilities assumed | 1,409 | |||||||||||
Net assets acquired | $ | 13,211 | ||||||||||
Schedule of Acquired Finite-Lived Intangible Assets by Major Class | The purchase price was allocated to identifiable intangible assets as follows (dollars in thousands): | |||||||||||
Fair | Weighted | Estimated | Weighted | |||||||||
Value | Average | Useful | Average | |||||||||
Assigned | Amortization | Life (Years) | Discount | |||||||||
Period (Years) | Rate | |||||||||||
Amortizing Intangible Assets | ||||||||||||
Technology and patents | $ | 1,058 | 6 | 10 | 14 | % | ||||||
Customer lists | 1,869 | 7 | 15 | 13 | % | |||||||
$ | 2,927 | 7 | 13 | 13 | % | |||||||
Indefinite-lived Intangible Assets | ||||||||||||
In-process research and development | $ | 540 | N/A | 12 | 26 | % | ||||||
Schedule of Acquired Indefinite-lived Intangible Assets by Major Class | ||||||||||||
Indefinite-lived Intangible Assets | ||||||||||||
In-process research and development | 540 | N/A | 12 | 26 | % | |||||||
Supplemental_Cash_Flow_Informa1
Supplemental Cash Flow Information (Tables) | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Supplemental Cash Flow Elements [Abstract] | ||||||||||||
Schedule of Cash Flow | ||||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
(in thousands) | ||||||||||||
Noncash investing and financing activities: | ||||||||||||
Common stock contributed to 401(k) Plan | $ | 4,341 | $ | 2,477 | $ | 4,793 | ||||||
Property, plant and equipment purchases included in accounts payable | 2,926 | 2,103 | 2,522 | |||||||||
Cash paid during the year for: | ||||||||||||
Interest | 3,521 | 4,989 | 6,230 | |||||||||
Income taxes | 13,565 | 44,165 | 4,909 | |||||||||
Acquisition of noncash assets | 22,434 | — | 14,396 | |||||||||
Liabilities assumed | 6,432 | — | 1,244 | |||||||||
Inventories_Tables
Inventories (Tables) | 12 Months Ended | |||||||
Jan. 02, 2015 | ||||||||
Inventory Disclosure [Abstract] | ||||||||
Schedule of Inventory, Current | Inventories are comprised of the following (in thousands): | |||||||
At | ||||||||
January 2, | January 3, | |||||||
2015 | 2014 | |||||||
Raw materials | $ | 73,354 | $ | 67,939 | ||||
Work-in-process | 38,930 | 36,670 | ||||||
Finished goods | 16,958 | 13,749 | ||||||
Total | $ | 129,242 | $ | 118,358 | ||||
Assets_Held_For_Sale_Tables
Assets Held For Sale (Tables) | 12 Months Ended | ||||||||||
Jan. 02, 2015 | |||||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||||
Disclosure of Long Lived Assets Held-for-sale | Assets held for sale included in Prepaid Expenses and Other Current Assets, is comprised of the following (in thousands): | ||||||||||
At | |||||||||||
Asset | Business | January 2, | January 3, | ||||||||
Segment | 2015 | 2014 | |||||||||
Building and building improvements | Greatbatch Medical | $ | 1,635 | $ | — | ||||||
Property_Plant_and_Equipment_N1
Property, Plant and Equipment, Net (Tables) | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Property, Plant and Equipment [Abstract] | ||||||||||||
Property, Plant and Equipment | Property, plant and equipment are comprised of the following (in thousands): | |||||||||||
At | ||||||||||||
January 2, | January 3, | |||||||||||
2015 | 2014 | |||||||||||
Manufacturing machinery and equipment | $ | 167,173 | $ | 159,542 | ||||||||
Buildings and building improvements | 89,258 | 87,359 | ||||||||||
Information technology hardware and software | 31,725 | 28,010 | ||||||||||
Leasehold improvements | 31,170 | 31,522 | ||||||||||
Furniture and fixtures | 14,045 | 13,889 | ||||||||||
Land and land improvements | 10,816 | 13,016 | ||||||||||
Construction work in process | 14,129 | 7,886 | ||||||||||
Other | 629 | 633 | ||||||||||
358,945 | 341,857 | |||||||||||
Accumulated depreciation | (214,020 | ) | (196,084 | ) | ||||||||
Total | $ | 144,925 | $ | 145,773 | ||||||||
Depreciation Expense Disclosure | Depreciation expense for property, plant and equipment was as follows (in thousands): | |||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Depreciation expense | $ | 23,320 | $ | 22,799 | $ | 31,575 | ||||||
Intangible_Assets_Tables
Intangible Assets (Tables) | 12 Months Ended | |||||||||||||||
Jan. 02, 2015 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||
Schedule of Finite-Lived Intangible Assets | Amortizing intangible assets, net are comprised of the following (in thousands): | |||||||||||||||
Gross | Accumulated | Foreign | Net | |||||||||||||
Carrying | Amortization | Currency | Carrying | |||||||||||||
Amount | Translation | Amount | ||||||||||||||
At January 2, 2015 | ||||||||||||||||
Purchased technology and patents | $ | 95,776 | $ | (75,894 | ) | $ | 1,966 | $ | 21,848 | |||||||
Customer lists | 72,857 | (31,460 | ) | 1,374 | 42,771 | |||||||||||
Other | 4,534 | (4,619 | ) | 803 | 718 | |||||||||||
Total amortizing intangible assets | $ | 173,167 | $ | (111,973 | ) | $ | 4,143 | $ | 65,337 | |||||||
At January 3, 2014 | ||||||||||||||||
Purchased technology and patents | $ | 97,376 | $ | (69,026 | ) | $ | 1,980 | $ | 30,330 | |||||||
Customer lists | 68,257 | (24,671 | ) | 1,367 | 44,953 | |||||||||||
Other | 4,434 | (4,399 | ) | 804 | 839 | |||||||||||
Total amortizing intangible assets | $ | 170,067 | $ | (98,096 | ) | $ | 4,151 | $ | 76,122 | |||||||
Schedule of Finite-Lived Intangible Assets, Amortization Expense | Aggregate intangible asset amortization expense is comprised of the following (in thousands): | |||||||||||||||
Year Ended | ||||||||||||||||
January 2, | January 3, | December 28, | ||||||||||||||
2015 | 2014 | 2012 | ||||||||||||||
Cost of sales | $ | 6,201 | $ | 6,822 | $ | 7,489 | ||||||||||
SG&A | 7,009 | 5,800 | 6,227 | |||||||||||||
RD&E | 667 | 545 | 545 | |||||||||||||
Total intangible asset amortization expense | $ | 13,877 | $ | 13,167 | $ | 14,261 | ||||||||||
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Estimated future intangible asset amortization expense based upon the current carrying value is as follows (in thousands): | |||||||||||||||
Estimated | ||||||||||||||||
Amortization | ||||||||||||||||
Expense | ||||||||||||||||
2015 | $ | 12,988 | ||||||||||||||
2016 | 10,676 | |||||||||||||||
2017 | 9,520 | |||||||||||||||
2018 | 7,232 | |||||||||||||||
2019 | 5,431 | |||||||||||||||
Thereafter | 19,490 | |||||||||||||||
Total estimated amortization expense | $ | 65,337 | ||||||||||||||
Schedule of Indefinite-Lived Intangible Assets | The change in indefinite-lived assets during 2014 is as follows (in thousands) | |||||||||||||||
Trademarks | ||||||||||||||||
and | ||||||||||||||||
Tradenames | ||||||||||||||||
At January 3, 2014 | $ | 20,288 | ||||||||||||||
At January 2, 2015 | $ | 20,288 | ||||||||||||||
Schedule of Goodwill | The change in goodwill during 2014 is as follows (in thousands): | |||||||||||||||
Greatbatch | QiG | Total | ||||||||||||||
Medical | ||||||||||||||||
At January 3, 2014 | $ | 304,856 | $ | 41,800 | $ | 346,656 | ||||||||||
Goodwill acquired (Note 2) | — | 8,296 | 8,296 | |||||||||||||
Foreign currency translation | (559 | ) | — | (559 | ) | |||||||||||
At January 2, 2015 | $ | 304,297 | $ | 50,096 | $ | 354,393 | ||||||||||
Accrued_Expenses_Tables
Accrued Expenses (Tables) | 12 Months Ended | |||||||
Jan. 02, 2015 | ||||||||
Accounts Payable and Accrued Liabilities [Abstract] | ||||||||
Schedule of Accrued Liabilities | Accrued expenses are comprised of the following (in thousands): | |||||||
At | ||||||||
January 2, | January 3, | |||||||
2015 | 2014 | |||||||
Salaries and benefits | $ | 20,770 | $ | 16,311 | ||||
Profit sharing and bonuses | 18,524 | 19,808 | ||||||
Warranty | 660 | 1,819 | ||||||
Other | 8,430 | 6,743 | ||||||
Total | $ | 48,384 | $ | 44,681 | ||||
Debt_Tables
Debt (Tables) | 12 Months Ended | ||||||||||||||||||||||
Jan. 02, 2015 | |||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||
Schedule of Debt | Long-term debt is comprised of the following (in thousands): | ||||||||||||||||||||||
At | |||||||||||||||||||||||
January 2, | 3-Jan-14 | ||||||||||||||||||||||
2015 | |||||||||||||||||||||||
Variable rate term loan | $ | 187,500 | $ | 197,500 | |||||||||||||||||||
Revolving line of credit | — | — | |||||||||||||||||||||
Total debt | 187,500 | 197,500 | |||||||||||||||||||||
Less current portion of long-term debt | 11,250 | — | |||||||||||||||||||||
Total long-term debt | $ | 176,250 | $ | 197,500 | |||||||||||||||||||
Schedule of Interest Rate Derivatives | Information regarding the Company’s outstanding interest rate swaps as of January 2, 2015 is as follows (dollars in thousands): | ||||||||||||||||||||||
Instrument | Type of | Notional | Start | End | Pay | Current | Fair | Balance | |||||||||||||||
Hedge | Amount | Date | Date | Fixed | Receive | Value | Sheet Location | ||||||||||||||||
Rate | Floating | 2-Jan-15 | |||||||||||||||||||||
Rate | |||||||||||||||||||||||
Interest rate swap | Cash flow | $ | 100,000 | 13-Feb | 16-Feb | 0.573 | % | 0.155 | % | $ | (125 | ) | Other Long-Term Liabilities | ||||||||||
Interest rate swap | Cash flow | $ | 90,000 | 15-Feb | 19-Sep | 1.921 | % | N/A | $ | (865 | ) | Other Long-Term Liabilities | |||||||||||
Schedule of Maturities of Long-term Debt | The expected future minimum principal payments under the Credit Facility as of January 2, 2015 are as follows (in thousands): | ||||||||||||||||||||||
2015 | $ | 11,250 | |||||||||||||||||||||
2016 | 16,250 | ||||||||||||||||||||||
2017 | 20,000 | ||||||||||||||||||||||
2018 | 20,000 | ||||||||||||||||||||||
2019 | 120,000 | ||||||||||||||||||||||
Total | 187,500 | ||||||||||||||||||||||
Schedule of Interest | The contractual interest and discount amortization for CSN were as follows (in thousands): | ||||||||||||||||||||||
Year Ended | |||||||||||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||||||||||
2015 | 2014 | 2012 | |||||||||||||||||||||
Contractual interest | $ | — | $ | 634 | $ | 4,450 | |||||||||||||||||
Discount amortization | — | 5,368 | 11,464 | ||||||||||||||||||||
Schedule of Deferred Financing Costs | The change in deferred financing fees is as follows (in thousands): | ||||||||||||||||||||||
At December 28, 2012 | $ | 2,056 | |||||||||||||||||||||
Financing costs deferred | 2,802 | ||||||||||||||||||||||
Write-off during the period | (156 | ) | |||||||||||||||||||||
Amortization during the period | (842 | ) | |||||||||||||||||||||
At January 3, 2014 | 3,860 | ||||||||||||||||||||||
Amortization during the period | (773 | ) | |||||||||||||||||||||
At January 2, 2015 | $ | 3,087 | |||||||||||||||||||||
Benefit_Plans_Tables
Benefit Plans (Tables) | 12 Months Ended | |||||||||||||||
Jan. 02, 2015 | ||||||||||||||||
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | ||||||||||||||||
Schedule of Changes in Projected Benefit Obligations | ||||||||||||||||
Year Ended | ||||||||||||||||
January 2, | January 3, | |||||||||||||||
2015 | 2014 | |||||||||||||||
Change in projected benefit obligation: | ||||||||||||||||
Projected benefit obligation at beginning of year | $ | 2,422 | $ | 16,215 | ||||||||||||
Service cost | 203 | 236 | ||||||||||||||
Interest cost | 75 | 138 | ||||||||||||||
Prior service cost and plan amendments | — | (45 | ) | |||||||||||||
Plan participants’ contribution | 36 | 134 | ||||||||||||||
Actuarial (gain) loss | 630 | (2 | ) | |||||||||||||
Benefits transferred in, net | 155 | 434 | ||||||||||||||
Settlement/curtailment gain | (337 | ) | (14,539 | ) | ||||||||||||
Foreign currency translation | (341 | ) | (149 | ) | ||||||||||||
Projected benefit obligation at end of year | 2,843 | 2,422 | ||||||||||||||
Schedule of Changes in Fair Value of Plan Assets | ||||||||||||||||
January 2, | January 3, | |||||||||||||||
2015 | 2014 | |||||||||||||||
Change in fair value of plan assets: | ||||||||||||||||
Fair value of plan assets at beginning of year | 731 | 12,269 | ||||||||||||||
Employer contributions (refund) | (39 | ) | 150 | |||||||||||||
Plan participants’ contributions | 36 | 134 | ||||||||||||||
Actual loss on plan assets | (101 | ) | (26 | ) | ||||||||||||
Benefits transferred in, net | 198 | 138 | ||||||||||||||
Settlements | (337 | ) | (11,780 | ) | ||||||||||||
Foreign currency translation | (51 | ) | (154 | ) | ||||||||||||
Fair value of plan assets at end of year | 437 | 731 | ||||||||||||||
Projected benefit obligation in excess of plan assets at end of year | $ | 2,406 | $ | 1,691 | ||||||||||||
Defined benefit liability classified as other current liabilities | $ | 25 | $ | 25 | ||||||||||||
Defined benefit liability classified as long-term liabilities | $ | 2,381 | $ | 1,666 | ||||||||||||
Accumulated benefit obligation at end of year | $ | 1,938 | $ | 1,684 | ||||||||||||
Schedule of Defined Benefit Plan Amounts Recognized in Other Comprehensive Income (Loss) | Amounts recognized in Accumulated Other Comprehensive Income are as follows (in thousands): | |||||||||||||||
Year Ended | ||||||||||||||||
January 2, | January 3, | |||||||||||||||
2015 | 2014 | |||||||||||||||
Net loss occurring during the year | $ | 736 | $ | 25 | ||||||||||||
Amortization of losses | (138 | ) | (722 | ) | ||||||||||||
Prior service cost | (2 | ) | 150 | |||||||||||||
Amortization of prior service cost | (11 | ) | 33 | |||||||||||||
Foreign currency translation | (76 | ) | 224 | |||||||||||||
Pre-tax adjustment | 509 | (290 | ) | |||||||||||||
Taxes | (135 | ) | 18 | |||||||||||||
Net (gain) loss | $ | 374 | $ | (272 | ) | |||||||||||
Schedule of Amounts in Accumulated Other Comprehensive Income (Loss) to be Recognized over Next Fiscal Year | The amortization of amounts in Accumulated Other Comprehensive Income expected to be recognized as components of net periodic benefit expense during 2015 are as follows (in thousands): | |||||||||||||||
Amortization of net prior service cost | $ | 11 | ||||||||||||||
Amortization of net loss | 45 | |||||||||||||||
Schedule of Net Benefit Costs | Net pension cost (income) is comprised of the following (in thousands): | |||||||||||||||
Year Ended | ||||||||||||||||
2-Jan-15 | 3-Jan-14 | |||||||||||||||
Service cost | $ | 203 | $ | 236 | ||||||||||||
Interest cost | 75 | 138 | ||||||||||||||
Settlements loss | 105 | — | ||||||||||||||
Expected return on assets | (3 | ) | — | |||||||||||||
Recognized net actuarial loss (gain) | 45 | (1,929 | ) | |||||||||||||
Net pension cost (income) | $ | 425 | $ | (1,555 | ) | |||||||||||
Schedule of Assumptions Used | The weighted-average rates used in the actuarial valuations were as follows: | |||||||||||||||
Projected Benefit Obligation | Net Pension Cost | |||||||||||||||
January 2, | January 3, | 2014 | 2013 | 2012 | ||||||||||||
2015 | 2014 | |||||||||||||||
Discount rate | 2.3 | % | 3.4 | % | 3.4 | % | 2.1 | % | 2.5 | % | ||||||
Salary growth | 3 | % | 3.1 | % | 3.1 | % | 2.4 | % | 2.3 | % | ||||||
Expected rate of return on assets | 2.3 | % | 2.5 | % | 2.5 | % | — | % | 3.5 | % | ||||||
Schedule of Allocation of Plan Assets | Plan assets were comprised of the following (in thousands): | |||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
2-Jan-15 | Quoted | Significant | Significant | |||||||||||||
Prices in | Other | Unobservable | ||||||||||||||
Active | Observable | Inputs | ||||||||||||||
Markets for | Inputs | (Level 3) | ||||||||||||||
Identical | (Level 2) | |||||||||||||||
Assets | ||||||||||||||||
(Level 1) | ||||||||||||||||
Insurance contract | $ | 437 | $ | — | $ | 437 | $ | — | ||||||||
Total | $ | 437 | $ | — | $ | 437 | $ | — | ||||||||
Fair Value Measurements Using | ||||||||||||||||
January 3, | Quoted | Significant | Significant | |||||||||||||
2014 | Prices in | Other | Unobservable | |||||||||||||
Active | Observable | Inputs | ||||||||||||||
Markets for | Inputs | (Level 3) | ||||||||||||||
Identical | (Level 2) | |||||||||||||||
Assets | ||||||||||||||||
(Level 1) | ||||||||||||||||
Insurance contract | $ | 731 | $ | — | $ | 731 | $ | — | ||||||||
Total | $ | 731 | $ | — | $ | 731 | $ | — | ||||||||
Schedule of Expected Benefit Payments | Estimated benefit payments over the next ten years are as follows (in thousands): | |||||||||||||||
2015 | $ | 47 | ||||||||||||||
2016 | 67 | |||||||||||||||
2017 | 124 | |||||||||||||||
2018 | 113 | |||||||||||||||
2019 | 177 | |||||||||||||||
2020-2024 | 866 | |||||||||||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 12 Months Ended | ||||||||||||
Jan. 02, 2015 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs | The components and classification of stock-based compensation expense were as follows (in thousands): | ||||||||||||
Year Ended | |||||||||||||
January 2, | January 3, | December 28, | |||||||||||
2015 | 2014 | 2012 | |||||||||||
Stock options | $ | 2,523 | $ | 3,490 | $ | 2,786 | |||||||
Restricted stock and units | 6,417 | 5,843 | 6,233 | ||||||||||
401(k) stock contribution | 4,246 | 4,768 | 1,885 | ||||||||||
Total stock-based compensation expense | $ | 13,186 | $ | 14,101 | $ | 10,904 | |||||||
Cost of sales | $ | 3,530 | $ | 3,864 | $ | 2,620 | |||||||
Selling, general and administrative expenses | 7,923 | 7,907 | 7,684 | ||||||||||
Research, development and engineering costs, net | 1,440 | 1,194 | 600 | ||||||||||
Other operating expenses, net (Note 13) | 293 | 1,136 | — | ||||||||||
Total stock-based compensation expense | $ | 13,186 | $ | 14,101 | $ | 10,904 | |||||||
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The weighted-average fair value and assumptions used are as follows: | ||||||||||||
Year Ended | |||||||||||||
January 2, | January 3, | December 28, | |||||||||||
2015 | 2014 | 2012 | |||||||||||
Weighted average grant date fair value | $ | 16.43 | $ | 8.38 | $ | 8.2 | |||||||
Risk-free interest rate | 1.73 | % | 0.73 | % | 0.83 | % | |||||||
Expected volatility | 39 | % | 39 | % | 40 | % | |||||||
Expected life (in years) | 5.3 | 5.3 | 5.3 | ||||||||||
Expected dividend yield | 0 | % | 0 | % | 0 | % | |||||||
Annual prevesting forfeiture rate | 9 | % | 9 | % | 9 | % | |||||||
Schedule of Share-based Compensation, Stock Options, Activity | The following table summarizes time-vested stock option activity: | ||||||||||||
Number of | Weighted | Weighted | Aggregate | ||||||||||
Time-Vested | Average | Average | Intrinsic | ||||||||||
Stock | Exercise | Remaining | Value | ||||||||||
Options | Price | Contractual | (In Millions) | ||||||||||
Life | |||||||||||||
(In Years) | |||||||||||||
Outstanding at December 30, 2011 | 1,558,771 | $ | 23.42 | ||||||||||
Granted | 395,978 | 22.19 | |||||||||||
Exercised | (52,683 | ) | 20.77 | ||||||||||
Forfeited or expired | (126,219 | ) | 24.21 | ||||||||||
Outstanding at December 28, 2012 | 1,775,847 | 23.17 | |||||||||||
Granted | 372,676 | 23.33 | |||||||||||
Exercised | (443,428 | ) | 23.24 | ||||||||||
Forfeited or expired | (88,686 | ) | 28.05 | ||||||||||
Outstanding at January 3, 2014 | 1,616,409 | 22.92 | |||||||||||
Granted | 183,571 | 43.84 | |||||||||||
Exercised | (295,203 | ) | 23.42 | ||||||||||
Forfeited or expired | (33,279 | ) | 27.82 | ||||||||||
Outstanding at January 2, 2015 | 1,471,498 | $ | 25.32 | 6.1 | $ | 34.3 | |||||||
Expected to vest at January 2, 2015 | 1,447,519 | $ | 25.1 | 6.1 | $ | 34.1 | |||||||
Exercisable at January 2, 2015 | 1,278,765 | $ | 23.88 | 5.8 | $ | 31.7 | |||||||
The following table summarizes performance-vested stock option activity: | |||||||||||||
Number of | Weighted | Weighted | Aggregate | ||||||||||
Performance- | Average | Average | Intrinsic | ||||||||||
Vested Stock | Exercise | Remaining | Value | ||||||||||
Options | Price | Contractual | (In Millions) | ||||||||||
Life | |||||||||||||
(In Years) | |||||||||||||
Outstanding at December 30, 2011 | 478,364 | $ | 24.44 | ||||||||||
Exercised | (7,657 | ) | 22.04 | ||||||||||
Forfeited or expired | (185,782 | ) | 26.35 | ||||||||||
Outstanding at December 28, 2012 | 284,925 | 23.26 | |||||||||||
Exercised | (107,664 | ) | 23.23 | ||||||||||
Forfeited or expired | — | — | |||||||||||
Outstanding at January 3, 2014 | 177,261 | 23.27 | |||||||||||
Exercised | (58,422 | ) | 23.35 | ||||||||||
Forfeited or expired | — | — | |||||||||||
Outstanding at January 2, 2015 | 118,839 | $ | 23.24 | 3 | $ | 3 | |||||||
Expected to vest at January 2, 2015 | 118,839 | $ | 23.24 | 3 | $ | 3 | |||||||
Exercisable at January 2, 2015 | 118,839 | $ | 23.24 | 3 | $ | 3 | |||||||
Schedule Of Stock Option Exercise Information | The following table provides certain information relating to the exercise of stock options (in thousands): | ||||||||||||
Year Ended | |||||||||||||
January 2, | January 3, | December 28, | |||||||||||
2015 | 2014 | 2012 | |||||||||||
Intrinsic value | $ | 7,997 | $ | 6,807 | $ | 148 | |||||||
Cash received | 8,278 | 12,807 | 1,263 | ||||||||||
Tax benefit (expense) realized | 1,704 | 727 | (132 | ) | |||||||||
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity | The following table summarizes performance-vested restricted stock and stock unit activity related to the Company’s plans: | ||||||||||||
Performance- | Weighted | ||||||||||||
Vested | Average | ||||||||||||
Activity | Fair Value | ||||||||||||
Nonvested at December 30, 2011 | 529,743 | $ | 16.68 | ||||||||||
Granted | 332,918 | 15.3 | |||||||||||
Vested | (15,500 | ) | 24.64 | ||||||||||
Forfeited | (64,715 | ) | 15.72 | ||||||||||
Nonvested at December 28, 2012 | 782,446 | 16.02 | |||||||||||
Granted | 318,169 | 15.86 | |||||||||||
Vested | (49,139 | ) | 14.68 | ||||||||||
Forfeited | (271,798 | ) | 14.94 | ||||||||||
Nonvested at January 3, 2014 | 779,678 | 16.41 | |||||||||||
Granted | 186,825 | 31.33 | |||||||||||
Vested | (221,470 | ) | 18.51 | ||||||||||
Forfeited | (28,870 | ) | 18.42 | ||||||||||
Nonvested at January 2, 2015 | 716,163 | $ | 19.57 | ||||||||||
The following table summarizes time-vested restricted stock and unit activity: | |||||||||||||
Time-Vested | Weighted | ||||||||||||
Activity | Average | ||||||||||||
Fair Value | |||||||||||||
Nonvested at December 30, 2011 | 69,942 | $ | 22.69 | ||||||||||
Granted | 92,265 | 23.49 | |||||||||||
Vested | (74,901 | ) | 22.83 | ||||||||||
Forfeited | (7,037 | ) | 22.56 | ||||||||||
Nonvested at December 28, 2012 | 80,269 | 23.48 | |||||||||||
Granted | 67,230 | 26.76 | |||||||||||
Vested | (74,062 | ) | 23.93 | ||||||||||
Forfeited | (5,862 | ) | 22.26 | ||||||||||
Nonvested at January 3, 2014 | 67,575 | 26.37 | |||||||||||
Granted | 63,817 | 44.78 | |||||||||||
Vested | (53,568 | ) | 34.16 | ||||||||||
Forfeited | (9,992 | ) | 35.3 | ||||||||||
Nonvested at January 2, 2015 | 67,832 | $ | 36.22 | ||||||||||
Research_Development_and_Engin1
Research, Development and Engineering Costs (Tables) | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Research and Development Expense [Abstract] | ||||||||||||
Schedule Of Research And Development Expense Details | Research, Development and Engineering Costs, Net are comprised of the following (in thousands): | |||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Research, development and engineering costs | $ | 58,974 | $ | 62,652 | $ | 62,848 | ||||||
Less: cost reimbursements | (9,129 | ) | (8,575 | ) | (10,358 | ) | ||||||
Total research, development and engineering costs, net | $ | 49,845 | $ | 54,077 | $ | 52,490 | ||||||
Other_Operating_Expenses_Net_T
Other Operating Expenses, Net (Tables) | 12 Months Ended | |||||||||||||||
Jan. 02, 2015 | ||||||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||||||
Schedule of Other Operating Cost and Expense, by Component | Other Operating Expenses, Net is comprised of the following (in thousands): | |||||||||||||||
Year Ended | ||||||||||||||||
January 2, | January 3, | December 28, | ||||||||||||||
2015 | 2014 | 2012 | ||||||||||||||
2014 investments in capacity and capabilities | $ | 8,925 | $ | — | $ | — | ||||||||||
2013 operating unit realignment | 1,017 | 5,625 | — | |||||||||||||
Orthopaedic facilities optimization | 1,317 | 8,038 | 32,482 | |||||||||||||
Medical device facility optimization | 11 | 312 | 1,525 | |||||||||||||
ERP system upgrade (income) costs | (82 | ) | 783 | 5,041 | ||||||||||||
Acquisition and integration (income) costs | 3 | (502 | ) | 1,460 | ||||||||||||
Asset dispositions, severance and other | 4,106 | 1,534 | 1,838 | |||||||||||||
Total other operating expenses, net | $ | 15,297 | $ | 15,790 | $ | 42,346 | ||||||||||
Investments in Capacity and Capabilities [Member] | ||||||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||||||
Schedule of Restructuring Reserve by Type of Cost | The change in accrued liabilities related to the 2014 investments in capacity and capabilities is as follows (in thousands): | |||||||||||||||
Severance and Retention | Accelerated | Other | Total | |||||||||||||
Depreciation/ | ||||||||||||||||
Asset Write-offs | ||||||||||||||||
At January 3, 2014 | $ | — | $ | — | $ | — | $ | — | ||||||||
Restructuring charges | 2,209 | 33 | 6,683 | 8,925 | ||||||||||||
Write-offs | — | (33 | ) | — | (33 | ) | ||||||||||
Cash payments | (1,046 | ) | — | (5,617 | ) | (6,663 | ) | |||||||||
At January 2, 2015 | $ | 1,163 | $ | — | $ | 1,066 | $ | 2,229 | ||||||||
Operating Unit Realignment [Member] | ||||||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||||||
Schedule of Restructuring Reserve by Type of Cost | Other costs primarily consist of relocation, recruitment and travel expenditures. The change in accrued liabilities related to the 2013 operating unit realignment is as follows (in thousands): | |||||||||||||||
Severance and Retention | Other | Total | ||||||||||||||
At January 3, 2014 | $ | 465 | $ | 746 | $ | 1,211 | ||||||||||
Restructuring charges | 849 | 168 | 1,017 | |||||||||||||
Cash payments | (1,314 | ) | (914 | ) | (2,228 | ) | ||||||||||
At January 2, 2015 | $ | — | $ | — | $ | — | ||||||||||
Orthopaedic Facility Optimization [Member] | ||||||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||||||
Schedule of Restructuring Reserve by Type of Cost | The change in accrued liabilities related to the orthopaedic facilities optimizations is as follows (in thousands): | |||||||||||||||
Severance | Accelerated | Other | Total | |||||||||||||
and | Depreciation/ | |||||||||||||||
Retention | Asset Write-offs | |||||||||||||||
At January 3, 2014 | $ | — | $ | — | $ | 857 | $ | 857 | ||||||||
Restructuring charges (income), net | — | (2,255 | ) | 3,572 | 1,317 | |||||||||||
Write-offs | — | (400 | ) | — | (400 | ) | ||||||||||
Cash receipts (payments) | — | 2,655 | (4,142 | ) | (1,487 | ) | ||||||||||
At January 2, 2015 | $ | — | $ | — | $ | 287 | $ | 287 | ||||||||
Medical Device Facility Optimization [Member] | ||||||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||||||
Schedule of Restructuring Reserve by Type of Cost | The change in accrued liabilities related to the medical device facility optimization is as follows (in thousands): | |||||||||||||||
Production | Personnel | Other | Total | |||||||||||||
Inefficiencies, | ||||||||||||||||
Moving and | ||||||||||||||||
Revalidation | ||||||||||||||||
At January 3, 2014 | $ | — | $ | — | $ | — | $ | — | ||||||||
Restructuring charges | — | 1 | 10 | 11 | ||||||||||||
Cash payments | — | (1 | ) | (10 | ) | (11 | ) | |||||||||
At January 2, 2015 | $ | — | $ | — | $ | — | $ | — | ||||||||
ERP System Upgrade [Member] | ||||||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||||||
Schedule of Restructuring Reserve by Type of Cost | The change in accrued liabilities related to the ERP system upgrade is as follows (in thousands): | |||||||||||||||
Training & | Accelerated | Total | ||||||||||||||
Consulting | Depreciation/ | |||||||||||||||
Costs | Asset Write-offs | |||||||||||||||
At January 3, 2014 | $ | — | $ | — | $ | — | ||||||||||
Restructuring income | (82 | ) | — | (82 | ) | |||||||||||
Cash receipts | 82 | — | 82 | |||||||||||||
At January 2, 2015 | $ | — | $ | — | $ | — | ||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||
Schedule of Income before Income Tax, Domestic and Foreign | The U.S. and international components of income before provision for income taxes were as follows (in thousands): | |||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
U.S. | $ | 56,801 | $ | 42,392 | $ | 36,057 | ||||||
International | 19,778 | 6,446 | (29,327 | ) | ||||||||
Total income before provision for income taxes | $ | 76,579 | $ | 48,838 | $ | 6,730 | ||||||
Schedule of Components of Income Tax Expense (Benefit) | The provision for income taxes was comprised of the following (in thousands): | |||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Current: | ||||||||||||
Federal | $ | 16,293 | $ | 39,353 | $ | 4,747 | ||||||
State | 1,299 | 1,604 | 381 | |||||||||
International | 2,998 | 1,470 | 668 | |||||||||
20,590 | 42,427 | 5,796 | ||||||||||
Deferred: | ||||||||||||
Federal | 1,211 | (28,678 | ) | 6,615 | ||||||||
State | (310 | ) | 427 | 175 | ||||||||
International | (370 | ) | (1,605 | ) | (1,057 | ) | ||||||
531 | (29,856 | ) | 5,733 | |||||||||
Total provision for income taxes | $ | 21,121 | $ | 12,571 | $ | 11,529 | ||||||
Schedule of Effective Income Tax Rate Reconciliation | The provision for income taxes differs from the U.S. statutory rate due to the following: | |||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Statutory rate | 35 | % | 35 | % | 35 | % | ||||||
Federal tax credits | (2.1 | ) | (7.5 | ) | — | |||||||
Foreign rate differential | (4.3 | ) | (0.7 | ) | 50.7 | |||||||
Uncertain tax positions | 0.6 | 1.7 | (10.1 | ) | ||||||||
State taxes, net of federal benefit | 0.7 | 2.3 | 4.9 | |||||||||
Change in tax rate - loss of Swiss tax holiday | — | — | 25.6 | |||||||||
Change in foreign tax rates | (0.6 | ) | (3.7 | ) | — | |||||||
Valuation allowance | (0.4 | ) | 0.4 | 67.6 | ||||||||
Other | (1.3 | ) | (1.8 | ) | (2.4 | ) | ||||||
Effective tax rate | 27.6 | % | 25.7 | % | 171.3 | % | ||||||
Schedule of Deferred Tax Assets and Liabilities | Deferred tax assets (liabilities) consist of the following (in thousands): | |||||||||||
At | ||||||||||||
January 2, | January 3, | |||||||||||
2015 | 2014 | |||||||||||
Tax credits | $ | 5,828 | $ | 6,624 | ||||||||
Net operating loss carryforwards | 6,721 | 9,161 | ||||||||||
Inventories | 3,335 | 4,202 | ||||||||||
Accrued expenses | 4,338 | 4,303 | ||||||||||
Stock-based compensation | 9,341 | 9,194 | ||||||||||
Other | 1,659 | 573 | ||||||||||
Gross deferred tax assets | 31,222 | 34,057 | ||||||||||
Less valuation allowance | (10,709 | ) | (11,661 | ) | ||||||||
Net deferred tax assets | 20,513 | 22,396 | ||||||||||
Property, plant and equipment | (2,646 | ) | (2,254 | ) | ||||||||
Intangible assets | (57,850 | ) | (57,648 | ) | ||||||||
Convertible subordinated notes | (5,006 | ) | (6,178 | ) | ||||||||
Gross deferred tax liabilities | (65,502 | ) | (66,080 | ) | ||||||||
Net deferred tax liability | $ | (44,989 | ) | $ | (43,684 | ) | ||||||
Presented as follows: | ||||||||||||
Current deferred tax asset | $ | 6,168 | $ | 6,008 | ||||||||
Current deferred tax liability | (588 | ) | (613 | ) | ||||||||
Noncurrent deferred tax asset | 2,626 | 2,933 | ||||||||||
Noncurrent deferred tax liability | (53,195 | ) | (52,012 | ) | ||||||||
Net deferred tax liability | $ | (44,989 | ) | $ | (43,684 | ) | ||||||
Summary of Operating Loss and Tax Credit Carryforwards | As of January 2, 2015, the Company has the following carryforwards available: | |||||||||||
Jurisdiction | Tax | Amount | Begin to | |||||||||
Attribute | (in millions) | Expire | ||||||||||
International | Net Operating Loss | 48 | -1 | 2015 | ||||||||
State | Net Operating Loss | 37.6 | -1 | Various | ||||||||
U.S. and State | R&D Tax Credit | 0.7 | -1 | Various | ||||||||
State | Investment Tax Credit | 5.3 | Various | |||||||||
(1) The utilization of certain net operating losses and credits is subject to an annual limitation under Internal Revenue Code Section 382. | ||||||||||||
Summary of Income Tax Contingencies | Below is a summary of changes to the unrecognized tax benefit (in thousands): | |||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Balance, beginning of year | $ | 1,858 | $ | 970 | $ | 1,580 | ||||||
Additions based upon tax positions related to the current year | 268 | 325 | — | |||||||||
Additions related to prior period tax positions | 510 | 651 | 210 | |||||||||
Reductions relating to settlements with tax authorities | (225 | ) | (88 | ) | (522 | ) | ||||||
Reductions as a result of a lapse of applicable statute of limitations | — | — | (298 | ) | ||||||||
Balance, end of year | $ | 2,411 | $ | 1,858 | $ | 970 | ||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||||||||||||||||
Jan. 02, 2015 | |||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||
Schedule of Product Warranty Liability | The change in product warranty liability was comprised of the following (in thousands): | ||||||||||||||||||
Year Ended | |||||||||||||||||||
January 2, | January 3, | ||||||||||||||||||
2015 | 2014 | ||||||||||||||||||
Beginning balance | $ | 1,819 | $ | 2,626 | |||||||||||||||
Additions to warranty reserve | 953 | 1,624 | |||||||||||||||||
Warranty claims paid | (2,112 | ) | (2,431 | ) | |||||||||||||||
Ending balance | $ | 660 | $ | 1,819 | |||||||||||||||
Operating Leases of Lessee Disclosure | Operating lease expense was as follows (in thousands): | ||||||||||||||||||
Year Ended | |||||||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||||||
2015 | 2014 | 2012 | |||||||||||||||||
Operating lease expense | $ | 4,281 | $ | 4,379 | $ | 4,024 | |||||||||||||
Schedule of Future Minimum Rental Payments for Operating Leases | Minimum future estimated annual operating lease expenses are as follows (in thousands): | ||||||||||||||||||
2015 | $ | 5,797 | |||||||||||||||||
2016 | 5,952 | ||||||||||||||||||
2017 | 3,908 | ||||||||||||||||||
2018 | 3,489 | ||||||||||||||||||
2019 | 3,418 | ||||||||||||||||||
Thereafter | 13,938 | ||||||||||||||||||
Total estimated operating lease expense | $ | 36,502 | |||||||||||||||||
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance | The impact to the Company’s results of operations from these forward contracts was as follows (in thousands): | ||||||||||||||||||
Year Ended | |||||||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||||||
2015 | 2014 | 2012 | |||||||||||||||||
Reduction in Cost of Sales | $ | (168 | ) | $ | (1,154 | ) | $ | (79 | ) | ||||||||||
Ineffective portion of change in fair value | — | — | — | ||||||||||||||||
Schedule of Foreign Exchange Contracts, Statement of Financial Position | Information regarding outstanding foreign currency contracts as of January 2, 2015 is as follows (dollars in thousands): | ||||||||||||||||||
Instrument | Type of | Aggregate | Start | End | $/Peso | Fair | Balance Sheet | ||||||||||||
Hedge | Notional | Date | Date | Value | Location | ||||||||||||||
Amount | |||||||||||||||||||
FX Contract | Cash flow | $ | 16,880 | 15-Jan | 15-Dec | 0.0734 | $ | (1,568 | ) | Accrued Expenses | |||||||||
Earnings_Loss_Per_Share_Tables
Earnings (Loss) Per Share (Tables) | 12 Months Ended | |||||||||||
Jan. 02, 2015 | ||||||||||||
Earnings Per Share [Abstract] | ||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The following table illustrates the calculation of Basic and Diluted EPS (in thousands, except per share amounts): | |||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Numerator for basic EPS: | ||||||||||||
Net income (loss) | $ | 55,458 | $ | 36,267 | $ | (4,799 | ) | |||||
Denominator for basic EPS: | ||||||||||||
Weighted average shares outstanding | 24,825 | 23,991 | 23,584 | |||||||||
Effect of dilutive securities: | ||||||||||||
Stock options, restricted stock and restricted stock units | 1,150 | 1,332 | — | |||||||||
Denominator for diluted EPS | 25,975 | 25,323 | 23,584 | |||||||||
Basic EPS | $ | 2.23 | $ | 1.51 | $ | (0.20 | ) | |||||
Diluted EPS | $ | 2.14 | $ | 1.43 | $ | (0.20 | ) | |||||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The diluted weighted average share calculations do not include the following securities, which are not dilutive to the EPS calculations or the performance criteria have not been met: | |||||||||||
Year Ended | ||||||||||||
January 2, | January 3, | December 28, | ||||||||||
2015 | 2014 | 2012 | ||||||||||
Time-vested stock options, restricted stock and restricted stock units | 175,549 | 18,480 | 2,142,000 | |||||||||
Performance-vested stock options and restricted stock units | — | — | 781,000 | |||||||||
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Income (Tables) | 12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||
Jan. 02, 2015 | Jan. 03, 2014 | |||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income is comprised of the following (in thousands): | |||||||||||||||||||||||||||||||||||||||||||||||
Defined | Cash | Foreign | Total | Tax | Net-of-Tax | |||||||||||||||||||||||||||||||||||||||||||
Defined | Cash | Foreign | Total | Tax | Net-of-Tax | Benefit | Flow | Currency | Pre-Tax | Amount | ||||||||||||||||||||||||||||||||||||||
Benefit | Flow | Currency | Pre-Tax | Amount | Plan | Hedges | Translation | Amount | ||||||||||||||||||||||||||||||||||||||||
Plan | Hedges | Translation | Amount | Liability | Adjustment | |||||||||||||||||||||||||||||||||||||||||||
Liability | Adjustment | At December 28, 2012 | $ | (962 | ) | $ | 120 | $ | 13,431 | $ | 12,589 | $ | 358 | $ | 12,947 | |||||||||||||||||||||||||||||||||
At January 3, 2014 | $ | (672 | ) | $ | (468 | ) | $ | 14,952 | $ | 13,812 | $ | 546 | $ | 14,358 | ||||||||||||||||||||||||||||||||||
Unrealized gain on cash flow hedges | — | 58 | — | 58 | (20 | ) | 38 | |||||||||||||||||||||||||||||||||||||||||
Unrealized loss on cash flow hedges | — | (2,372 | ) | — | (2,372 | ) | 829 | (1,543 | ) | |||||||||||||||||||||||||||||||||||||||
Realized gain on foreign currency hedges | — | (1,154 | ) | — | (1,154 | ) | 404 | (750 | ) | |||||||||||||||||||||||||||||||||||||||
Realized gain on foreign currency hedges | — | (168 | ) | — | (168 | ) | 59 | (109 | ) | |||||||||||||||||||||||||||||||||||||||
Realized loss on interest rate swap hedges | — | 508 | — | 508 | (178 | ) | 330 | |||||||||||||||||||||||||||||||||||||||||
Realized loss on interest rate swap hedges | — | 450 | — | 450 | (157 | ) | 293 | |||||||||||||||||||||||||||||||||||||||||
Net defined benefit plan liability adjustments | 290 | — | — | 290 | (18 | ) | 272 | |||||||||||||||||||||||||||||||||||||||||
Net defined benefit plan liability adjustments | (509 | ) | — | — | (509 | ) | 135 | (374 | ) | |||||||||||||||||||||||||||||||||||||||
Foreign currency translation gain | — | — | 1,521 | 1,521 | — | 1,521 | ||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation loss | — | — | (3,502 | ) | (3,502 | ) | — | (3,502 | ) | |||||||||||||||||||||||||||||||||||||||
At January 3, 2014 | $ | (672 | ) | $ | (468 | ) | $ | 14,952 | $ | 13,812 | $ | 546 | $ | 14,358 | ||||||||||||||||||||||||||||||||||
At January 2, 2015 | $ | (1,181 | ) | $ | (2,558 | ) | $ | 11,450 | $ | 7,711 | $ | 1,412 | $ | 9,123 | ||||||||||||||||||||||||||||||||||
Fair_Value_Tables
Fair Value (Tables) | 12 Months Ended | |||||||||||||||
Jan. 02, 2015 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | Changes in accrued contingent consideration were as follows (in thousands): | |||||||||||||||
At December 28, 2012 | $ | 1,530 | ||||||||||||||
Fair value adjustments | (690 | ) | ||||||||||||||
At January 3, 2014 | 840 | |||||||||||||||
Fair value adjustments | (840 | ) | ||||||||||||||
At January 2, 2015 | $ | — | ||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables provide information regarding assets and liabilities recorded at fair value on a recurring basis (in thousands): | |||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Description | At January 2, 2015 | Quoted | Significant | Significant | ||||||||||||
Prices in | Other | Unobservable | ||||||||||||||
Active Markets | Observable | Inputs | ||||||||||||||
for Identical | Inputs | (Level 3) | ||||||||||||||
Assets | (Level 2) | |||||||||||||||
(Level 1) | ||||||||||||||||
Liabilities | ||||||||||||||||
Foreign currency contracts (Note 15) | $ | 1,568 | $ | — | $ | 1,568 | $ | — | ||||||||
Interest rate swaps (Note 9) | 990 | — | 990 | — | ||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Description | At January 3, | Quoted | Significant | Significant | ||||||||||||
2014 | Prices in | Other | Unobservable | |||||||||||||
Active Markets | Observable | Inputs | ||||||||||||||
for Identical | Inputs | (Level 3) | ||||||||||||||
Assets | (Level 2) | |||||||||||||||
(Level 1) | ||||||||||||||||
Liabilities | ||||||||||||||||
Foreign currency contracts | $ | 140 | $ | — | $ | 140 | $ | — | ||||||||
Accrued contingent consideration | 840 | — | — | 840 | ||||||||||||
Interest rate swap | 328 | — | 328 | — | ||||||||||||
Fair Value Measurements, Nonrecurring | The following table provides information regarding assets and liabilities recorded at fair value on a nonrecurring basis as of January 2, 2015. There were no such assets or liabilities as of January 3, 2014 (in thousands): | |||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Description | At January 2, 2015 | Quoted | Significant | Significant | ||||||||||||
Prices in | Other | Unobservable | ||||||||||||||
Active Markets | Observable | Inputs | ||||||||||||||
for Identical | Inputs | (Level 3) | ||||||||||||||
Assets | (Level 2) | |||||||||||||||
(Level 1) | ||||||||||||||||
Assets | ||||||||||||||||
Assets Held for Sale (Note 5) | $ | 1,635 | $ | — | $ | 1,635 | $ | — | ||||||||
Business_Segment_Geographic_an1
Business Segment, Geographic and Concentration Risk Information (Tables) | 12 Months Ended | ||||||||||||||
Jan. 02, 2015 | |||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||
Reconciliation of Revenue from Segments to Consolidated | Sales by geographic area are presented by allocating sales from external customers based on where the products are shipped to (in thousands): | ||||||||||||||
Year Ended | |||||||||||||||
Sales: | January 2, | January 3, | December 28, | ||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Greatbatch Medical | |||||||||||||||
Cardiac/Neuromodulation | $ | 321,419 | $ | 325,412 | $ | 306,669 | |||||||||
Orthopaedics | 147,296 | 130,247 | 122,061 | ||||||||||||
Portable Medical | 69,043 | 78,743 | 81,659 | ||||||||||||
Vascular | 58,770 | 48,357 | 51,980 | ||||||||||||
Energy, Military, Environmental | 81,757 | 78,143 | 81,353 | ||||||||||||
Total Greatbatch Medical | 678,285 | 660,902 | 643,722 | ||||||||||||
QiG | 9,502 | 3,043 | 2,455 | ||||||||||||
Total sales | $ | 687,787 | $ | 663,945 | $ | 646,177 | |||||||||
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | |||||||||||||||
Year Ended | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Segment income (loss) from operations: | |||||||||||||||
Greatbatch Medical | $ | 126,312 | $ | 111,805 | $ | 79,093 | |||||||||
QiG | (23,256 | ) | (30,484 | ) | (32,554 | ) | |||||||||
Total segment income from operations | 103,056 | 81,321 | 46,539 | ||||||||||||
Unallocated operating expenses | (27,402 | ) | (19,982 | ) | (20,718 | ) | |||||||||
Operating income as reported | 75,654 | 61,339 | 25,821 | ||||||||||||
Unallocated other income (expense), net | 925 | (12,501 | ) | (19,091 | ) | ||||||||||
Income before provision for income taxes as reported | $ | 76,579 | $ | 48,838 | $ | 6,730 | |||||||||
Reconciliation Of Depreciation And Amortization By Reportable Segment To Consolidated | |||||||||||||||
Year Ended | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Depreciation and Amortization: | |||||||||||||||
Greatbatch Medical | $ | 31,906 | $ | 31,112 | $ | 39,820 | |||||||||
QiG | 2,101 | 1,539 | 630 | ||||||||||||
Total depreciation and amortization included in segment income from operations | 34,007 | 32,651 | 40,450 | ||||||||||||
Unallocated depreciation and amortization | 4,223 | 9,681 | 18,475 | ||||||||||||
Total depreciation and amortization | $ | 38,230 | $ | 42,332 | $ | 58,925 | |||||||||
Schedule Of Expenditures For Tangible Long-Lived Assets By Segment | |||||||||||||||
Year Ended | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Expenditures for tangible long-lived assets, excluding acquisitions: | |||||||||||||||
Greatbatch Medical | $ | 19,006 | $ | 13,242 | $ | 33,249 | |||||||||
QiG | 1,453 | 2,134 | 3,208 | ||||||||||||
Total reportable segments | 20,459 | 15,376 | 36,457 | ||||||||||||
Unallocated long-lived tangible assets | 5,187 | 2,798 | 4,709 | ||||||||||||
Total expenditures | $ | 25,646 | $ | 18,174 | $ | 41,166 | |||||||||
Reconciliation of Assets from Segment to Consolidated | |||||||||||||||
At | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Identifiable assets: | |||||||||||||||
Greatbatch Medical | $ | 761,225 | $ | 758,369 | $ | 779,890 | |||||||||
QiG | 76,529 | 56,245 | 57,750 | ||||||||||||
Total reportable segments | 837,754 | 814,614 | 837,640 | ||||||||||||
Unallocated assets | 118,255 | 76,089 | 52,235 | ||||||||||||
Total assets | $ | 956,009 | $ | 890,703 | $ | 889,875 | |||||||||
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas | |||||||||||||||
Year Ended | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Sales by geographic area: | |||||||||||||||
United States | $ | 312,539 | $ | 325,090 | $ | 330,537 | |||||||||
Non-Domestic locations: | |||||||||||||||
Puerto Rico | 127,702 | 117,961 | 105,731 | ||||||||||||
Belgium | 65,308 | 67,155 | 58,043 | ||||||||||||
Rest of world | 182,238 | 153,739 | 151,866 | ||||||||||||
Total sales | $ | 687,787 | $ | 663,945 | $ | 646,177 | |||||||||
At | |||||||||||||||
January 2, | January 3, | December 28, | |||||||||||||
2015 | 2014 | 2012 | |||||||||||||
Long-lived tangible assets: | |||||||||||||||
United States | $ | 113,851 | $ | 116,484 | $ | 123,104 | |||||||||
Rest of world | 31,074 | 29,289 | 27,789 | ||||||||||||
Total | $ | 144,925 | $ | 145,773 | $ | 150,893 | |||||||||
Schedule of Revenue by Major Customers by Reporting Segments | A significant portion of the Company’s sales and accounts receivable were to four customers as follows: | ||||||||||||||
Sales | Accounts Receivable | ||||||||||||||
Year Ended | At | ||||||||||||||
January 2, | January 3, | December 28, | January 2, | January 3, | |||||||||||
2015 | 2014 | 2012 | 2015 | 2014 | |||||||||||
Customer A | 18 | % | 20 | % | 19 | % | 4 | % | 8 | % | |||||
Customer B | 18 | % | 16 | % | 16 | % | 23 | % | 19 | % | |||||
Customer C | 12 | % | 13 | % | 11 | % | 8 | % | 8 | % | |||||
Customer D | 6 | % | 7 | % | 6 | % | 12 | % | 11 | % | |||||
54 | % | 56 | % | 52 | % | 47 | % | 46 | % |
Quarterly_Sales_and_Earnings_D1
Quarterly Sales and Earnings Data - Unaudited (Tables) | 12 Months Ended | |||||||||||||||
Jan. 02, 2015 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||
Schedule of Quarterly Financial Information | ||||||||||||||||
4th Qtr. | 3rd Qtr. | 2nd Qtr. | 1st Qtr. | |||||||||||||
(in thousands, except per share data) | ||||||||||||||||
2014 | ||||||||||||||||
Sales | $ | 169,726 | $ | 171,699 | $ | 172,081 | $ | 174,281 | ||||||||
Gross profit | 57,214 | 58,118 | 58,470 | 57,596 | ||||||||||||
Net income | 14,176 | 14,012 | 12,348 | 14,922 | ||||||||||||
EPS—basic | 0.57 | 0.56 | 0.5 | 0.61 | ||||||||||||
EPS—diluted | 0.54 | 0.54 | 0.48 | 0.58 | ||||||||||||
2013 | ||||||||||||||||
Sales | $ | 176,619 | $ | 167,730 | $ | 171,331 | $ | 148,265 | ||||||||
Gross profit | 57,385 | 55,877 | 57,302 | 48,749 | ||||||||||||
Net income | 9,781 | 11,071 | 9,752 | 5,663 | ||||||||||||
EPS—basic | 0.4 | 0.46 | 0.41 | 0.24 | ||||||||||||
EPS—diluted | 0.38 | 0.44 | 0.39 | 0.23 | ||||||||||||
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Basis of Presentation) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
customer | |||
Segment | |||
Schedule of Assets Useful Life [Line Items] | |||
Number of Reportable Segments | 2 | ||
Number of Customers | 4 | ||
Weeks In Reporting Period | Fifty-two | Fifty-three | Fifty-two |
Customer Supplied Components Excluded From Revenue | $48.10 | $45.30 | $32.60 |
Foreign Currency Transaction Gain (Loss), Realized | $1.30 | ($0.10) | ($0.30) |
Patented Technology [Member] | Minimum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 5 years | ||
Patented Technology [Member] | Maximum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 15 years | ||
Customer Lists [Member] | Minimum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 7 years | ||
Customer Lists [Member] | Maximum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 20 years | ||
Other Intangible Assets [Member] | Minimum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 1 year | ||
Other Intangible Assets [Member] | Maximum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 10 years | ||
Building and Building Improvements [Member] | Minimum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Property, Plant and Equipment, Useful Life | 7 years | ||
Building and Building Improvements [Member] | Maximum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Property, Plant and Equipment, Useful Life | 40 years | ||
Machinery and Equipment [Member] | Minimum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Machinery and Equipment [Member] | Maximum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Property, Plant and Equipment, Useful Life | 8 years | ||
Office Equipment [Member] | Minimum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Office Equipment [Member] | Maximum [Member] | |||
Schedule of Assets Useful Life [Line Items] | |||
Property, Plant and Equipment, Useful Life | 10 years |
Acquisitions_Narrative_Details
Acquisitions (Narrative) (Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | |
Aug. 12, 2014 | Jan. 02, 2015 | Feb. 16, 2012 | Dec. 28, 2012 | Jan. 03, 2014 | |
Business Acquisition [Line Items] | |||||
Contingent consideration liability | $0 | $1,530,000 | $840,000 | ||
Centro De Construccion De Cardioestimuladores Del Uruguay [Member] | |||||
Business Acquisition [Line Items] | |||||
Effective date of acquisition | 12-Aug-14 | ||||
Name of acquired entity | Centro de Construcción de Cardioestimuladores del Uruguay (“CCCâ€) | ||||
Description of acquired entity | CCC is an active implantable neuromodulation medical device systems developer and manufacturer that produces a range of medical devices including implantable pulse generators, programmer systems, battery chargers, patient wands and leads. | ||||
Reason for acquisition | This acquisition allows the Company to more broadly partner with medical device companies, complements the Company’s core discrete technology offerings and enhances the Company’s medical device innovation efforts. | ||||
Total revenue included from the acquired entity | 5,800,000 | ||||
Total net income included from the acquired entity | 1,200,000 | ||||
Cash paid | 19,800,000 | ||||
Increase in inventory | 300,000 | ||||
Centro De Construccion De Cardioestimuladores Del Uruguay [Member] | Technology-Based Intangible Assets [Member] | |||||
Business Acquisition [Line Items] | |||||
Royalty rate | 3.00% | ||||
Centro De Construccion De Cardioestimuladores Del Uruguay [Member] | Customer Lists [Member] | |||||
Business Acquisition [Line Items] | |||||
Customer annual attrition rate | 15.00% | ||||
Centro De Construccion De Cardioestimuladores Del Uruguay [Member] | Trademarks and Trade Names [Member] | |||||
Business Acquisition [Line Items] | |||||
Royalty rate | 0.50% | ||||
Neuro Nexus Technologies Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Effective date of acquisition | 16-Feb-12 | ||||
Name of acquired entity | NeuroNexus Technologies, Inc. | ||||
Description of acquired entity | NeuroNexus is an active implantable medical device design firm specializing in developing and commercializing neural interface technology, components and systems for neuroscience and clinical markets. | ||||
Reason for acquisition | NeuroNexus has an extensive intellectual property portfolio, core technologies and capabilities to support the development and manufacturing of neural interface devices across a wide range of applications including neuromodulation, sensing, optical stimulation and targeted drug delivery. | ||||
Total revenue included from the acquired entity | 2,500,000 | ||||
Total net income included from the acquired entity | -200,000 | ||||
Cash paid | 11,700,000 | ||||
Potential future payments (maximum) | 2,000,000 | ||||
Contingent consideration liability | 1,500,000 | ||||
Neuro Nexus Technologies Inc [Member] | Patented Technology [Member] | |||||
Business Acquisition [Line Items] | |||||
Minimum royalty rate assumed, acquired finite lived intangible assets | 2.00% | ||||
Maximum royalty rate assumed, acquired finite lived intangible assets | 6.00% | ||||
Neuro Nexus Technologies Inc [Member] | In Process Research And Development [Member] | |||||
Business Acquisition [Line Items] | |||||
Estimated cost to complete in process research and development programs acquired | $1,500,000 |
Acquisitions_Details_1
Acquisitions (Details 1) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 | Aug. 12, 2014 | Feb. 16, 2012 |
In Thousands, unless otherwise specified | ||||
Assets acquired | ||||
Goodwill | $354,393 | $346,656 | ||
Centro De Construccion De Cardioestimuladores Del Uruguay [Member] | ||||
Assets acquired | ||||
Current assets | 10,670 | |||
Property, plant and equipment | 1,131 | |||
Amortizing intangible assets | 6,100 | |||
Goodwill | 8,296 | |||
Total assets acquired | 26,197 | |||
Liabilities assumed | ||||
Current liabilities | 4,842 | |||
Deferred income taxes | 1,590 | |||
Total liabilities assumed | 6,432 | |||
Net assets acquired | 19,765 | |||
Neuro Nexus Technologies Inc [Member] | ||||
Assets acquired | ||||
Current assets | 618 | |||
Property, plant and equipment | 35 | |||
Amortizing intangible assets | 2,927 | |||
Indefinite-lived intangible assets | 540 | |||
Goodwill | 8,924 | |||
Other assets | 1,576 | |||
Total assets acquired | 14,620 | |||
Liabilities assumed | ||||
Current liabilities | 420 | |||
Deferred income taxes | 989 | |||
Total liabilities assumed | 1,409 | |||
Net assets acquired | $13,211 |
Acquisitions_Details_2
Acquisitions (Details 2) (USD $) | 0 Months Ended | |
In Thousands, unless otherwise specified | Aug. 12, 2014 | Feb. 16, 2012 |
Centro De Construccion De Cardioestimuladores Del Uruguay [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortizing intangible assets | $6,100 | |
Weighted Average Amortization Period (Years) | 10 years | |
Weighted Average Discount Rate | 18.00% | |
Neuro Nexus Technologies Inc [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortizing intangible assets | 2,927 | |
Weighted Average Amortization Period (Years) | 7 years | |
Weighted Average Useful Life (Years) | 13 years | |
Weighted Average Discount Rate | 13.00% | |
Patented Technology [Member] | Centro De Construccion De Cardioestimuladores Del Uruguay [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortizing intangible assets | 1,400 | |
Weighted Average Amortization Period (Years) | 10 years | |
Weighted Average Discount Rate | 18.00% | |
Patented Technology [Member] | Neuro Nexus Technologies Inc [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortizing intangible assets | 1,058 | |
Weighted Average Amortization Period (Years) | 6 years | |
Weighted Average Useful Life (Years) | 10 years | |
Weighted Average Discount Rate | 14.00% | |
Customer Lists [Member] | Centro De Construccion De Cardioestimuladores Del Uruguay [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortizing intangible assets | 4,600 | |
Weighted Average Amortization Period (Years) | 10 years | |
Weighted Average Discount Rate | 18.00% | |
Customer Lists [Member] | Neuro Nexus Technologies Inc [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortizing intangible assets | 1,869 | |
Weighted Average Amortization Period (Years) | 7 years | |
Weighted Average Useful Life (Years) | 15 years | |
Weighted Average Discount Rate | 13.00% | |
Trademarks and Trade Names [Member] | Centro De Construccion De Cardioestimuladores Del Uruguay [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortizing intangible assets | $100 | |
Weighted Average Amortization Period (Years) | 2 years | |
Weighted Average Discount Rate | 18.00% |
Acquisitions_Acquired_Indefini
Acquisitions (Acquired Indefinite-lived Intangible Assets) (Details) (Neuro Nexus Technologies Inc [Member], In Process Research And Development [Member], USD $) | 0 Months Ended |
In Thousands, unless otherwise specified | Feb. 16, 2012 |
Neuro Nexus Technologies Inc [Member] | In Process Research And Development [Member] | |
Acquired Indefinite-lived Intangible Assets [Line Items] | |
Indefinite-lived assets acquired | $540 |
Weighted Average Useful Life (Years) | 12 years |
Weighted Average Discount Rate | 26.00% |
Acquisitions_Pro_Forma_Informa
Acquisitions (Pro Forma Information) (Details) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Business Acquisition, Pro Forma Information [Abstract] | |||
Sales | $696,357 | $677,657 | $646,617 |
Net income (loss) | $56,453 | $37,612 | ($4,973) |
Basic earnings per share (in dollars per share) | $2.27 | $1.57 | ($0.21) |
Diluted earnings per share (in dollars per share) | $2.17 | $1.49 | ($0.21) |
Supplemental_Cash_Flow_Informa2
Supplemental Cash Flow Information (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Noncash investing and financing activities: | |||
Common stock contributed to 401(k) Plan | $4,341 | $2,477 | $4,793 |
Property, plant and equipment purchases included in accounts payable | 2,926 | 2,103 | 2,522 |
Cash paid during the year for: | |||
Interest | 3,521 | 4,989 | 6,230 |
Income taxes | 13,565 | 44,165 | 4,909 |
Acquisition of noncash assets | 22,434 | 0 | 14,396 |
Liabilities assumed | $6,432 | $0 | $1,244 |
Inventories_Details
Inventories (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ||
Raw materials | $73,354 | $67,939 |
Work-in-process | 38,930 | 36,670 |
Finished goods | 16,958 | 13,749 |
Inventories | $129,242 | $118,358 |
Assets_Held_For_Sale_Details
Assets Held For Sale (Details) (Building [Member], Swiss Orthopaedic Product Line [Member], Greatbatch Medical [Member], USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
In Thousands, unless otherwise specified | ||
Building [Member] | Swiss Orthopaedic Product Line [Member] | Greatbatch Medical [Member] | ||
Assets Held For Sale Detail [Line Items] | ||
Current assets held-for-sale | $1,635 | $0 |
Assets_Held_For_Sale_Narrative
Assets Held For Sale (Narrative) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | Jan. 02, 2015 |
Assets Held For Sale Detail [Line Items] | ||||
Impairment of Long-Lived Assets to be Disposed of | $0.40 | $0.90 | $3.60 | |
Orthopaedic Facility Optimization [Member] | ||||
Assets Held For Sale Detail [Line Items] | ||||
Assets Held for Sale (Note 5) | 2.1 | |||
Impairment of Long-Lived Assets to be Disposed of | $0.40 |
Property_Plant_and_Equipment_N2
Property, Plant and Equipment, Net (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
In Thousands, unless otherwise specified | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | $358,945 | $341,857 | |
Accumulated depreciation | -214,020 | -196,084 | |
Total | 144,925 | 145,773 | 150,893 |
Machinery and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 167,173 | 159,542 | |
Building and Building Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 89,258 | 87,359 | |
Computer Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 31,725 | 28,010 | |
Leasehold Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 31,170 | 31,522 | |
Furniture and Fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 14,045 | 13,889 | |
Land and Land Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 10,816 | 13,016 | |
Construction in Progress [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 14,129 | 7,886 | |
Other Capitalized Property Plant and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | $629 | $633 |
Property_Plant_and_Equipment_N3
Property, Plant and Equipment, Net (Depreciation Expense) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Property, Plant and Equipment [Abstract] | |||
Depreciation | $23,320 | $22,799 | $31,575 |
Intangible_Assets_Narrative_De
Intangible Assets (Narrative) (Details) (USD $) | 12 Months Ended | |
Jan. 02, 2015 | Jan. 03, 2014 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Contingent Liability From Intangible Asset Purchase | $4,000,000 | |
Reversal of Contingent Liability From Intangible Asset Purchase | 3,000,000 | |
Goodwill, Impaired, Accumulated Impairment Loss | $0 |
Intangible_Assets_Amortizing_I
Intangible Assets (Amortizing Intangible Assets) (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $173,167,000 | $170,067,000 |
Accumulated Amortization | -111,973,000 | -98,096,000 |
Foreign Currency Translation | 4,143,000 | 4,151,000 |
Net Carrying Amount | 65,337,000 | 76,122,000 |
Purchased Technology And Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 95,776,000 | 97,376,000 |
Accumulated Amortization | -75,894,000 | -69,026,000 |
Foreign Currency Translation | 1,966,000 | 1,980,000 |
Net Carrying Amount | 21,848,000 | 30,330,000 |
Customer Lists [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 72,857,000 | 68,257,000 |
Accumulated Amortization | -31,460,000 | -24,671,000 |
Foreign Currency Translation | 1,374,000 | 1,367,000 |
Net Carrying Amount | 42,771,000 | 44,953,000 |
Other Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 4,534,000 | 4,434,000 |
Accumulated Amortization | -4,619,000 | -4,399,000 |
Foreign Currency Translation | 803,000 | 804,000 |
Net Carrying Amount | $718,000 | $839,000 |
Intangible_Assets_Amortization
Intangible Assets (Amortization Expense by categories) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of Intangible Assets | $13,877 | $13,167 | $14,261 |
Cost of Sales [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of Intangible Assets | 6,201 | 6,822 | 7,489 |
Selling, General and Administrative Expenses [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of Intangible Assets | 7,009 | 5,800 | 6,227 |
Research and Development Expense [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of Intangible Assets | $667 | $545 | $545 |
Intangible_Assets_Future_Amort
Intangible Assets (Future Amortization Expense) (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
In Thousands, unless otherwise specified | ||
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2015 | $12,988 | |
2016 | 10,676 | |
2017 | 9,520 | |
2018 | 7,232 | |
2019 | 5,431 | |
Thereafter | 19,490 | |
Net Carrying Amount | $65,337 | $76,122 |
Intangible_Assets_Change_in_In
Intangible Assets (Change in Indefinite-lived Assets and Goodwill) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 |
Indefinite-lived Intangible Assets [Roll Forward] | ||
Indefinite-lived intangible assets, beginning | $20,288 | |
Indefinite-lived intangible assets, ending | 20,288 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning | 346,656 | |
Goodwill acquired | 8,296 | |
Foreign currency translation | -559 | |
Goodwill, ending | 354,393 | |
Greatbatch Medical [Member] | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning | 304,856 | |
Goodwill acquired | 0 | |
Foreign currency translation | -559 | |
Goodwill, ending | 304,297 | |
QiG [Member] | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning | 41,800 | |
Goodwill acquired | 8,296 | |
Foreign currency translation | 0 | |
Goodwill, ending | 50,096 | |
Trademarks and Trade Names [Member] | ||
Indefinite-lived Intangible Assets [Roll Forward] | ||
Indefinite-lived intangible assets, beginning | 20,288 | |
Indefinite-lived intangible assets, ending | $20,288 | $20,288 |
Accrued_Expenses_Details
Accrued Expenses (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
In Thousands, unless otherwise specified | ||
Accounts Payable and Accrued Liabilities [Abstract] | ||
Salaries and benefits | $20,770 | $16,311 |
Profit sharing and bonuses | 18,524 | 19,808 |
Warranty | 660 | 1,819 |
Other | 8,430 | 6,743 |
Total | $48,384 | $44,681 |
Debt_Schedule_of_LongTerm_Debt
Debt (Schedule of Long-Term Debt) (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
In Thousands, unless otherwise specified | ||
Debt Disclosure [Abstract] | ||
Term Loan | $187,500 | $197,500 |
Line of Credit Facility, Amount Outstanding | 0 | 0 |
Long-term Debt | 187,500 | 197,500 |
Current portion of long-term debt | 11,250 | 0 |
Long-term debt | $176,250 | $197,500 |
Debt_Credit_Facility_Details_D
Debt (Credit Facility Details) (Details 1) (USD $) | 1 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2013 | Jan. 02, 2015 |
Line of Credit Facility [Abstract] | ||
Credit Facility, Amendment Date | 20-Sep-13 | |
Line of Credit Facility, Maximum Borrowing Capacity | $300 | |
Term Loan, Maximum Borrowing Capacity | 200 | |
Letter of Credit Subfacility Maximum Borrowing Capacity | 15 | |
Swingline Subfacility Maximum Borrowing Capacity | 15 | |
Credit Facility Borrowing Capacity Increase | 200 | |
Line of Credit Facility, Expiration Date | 20-Sep-18 | |
Line Of Credit Expiration Date Extension | 20-Sep-19 | |
Debt Instrument, Maturity Date | 20-Sep-19 | |
Debt Instrument, Collateral | The Credit Facility is secured by the Company’s non-realty assets including cash, accounts receivable and inventories. | |
Interest Margin Above Prime Minimum Credit Facility | 0.00% | |
Interest Margin Above Prime Maximum Credit Facility | 0.75% | |
Interest Margin Above LIBOR Minimum Credit Facility | 1.38% | |
Interest Margin Above LIBOR Maximum Credit Facility | 2.75% | |
Interest Margin Above Prime Minimum Swingline | 0.00% | |
Interest Margin Above Prime Maximum Swingline | 0.75% | |
Line of Credit Facility Commitment Fee Percentage Minimum | 0.18% | |
Line of Credit Facility Commitment Fee Percentage Maximum | 0.25% | |
Credit Facility Aggregate Restricted Activities Limit | 300 | |
Credit Facility Maximum Permitted Acquisitions | 250 | |
Credit Facility Maximum Other Investment Purchases | 100 | |
Credit Facility Maximum Stock Repurchases and Declare Dividends | 150 | |
Credit Facility Maximum Foreign Subsidiary Investment | 20 | |
Line of Credit, Adjustments to Limitations on Incurrence of Indebtedness, Maximum Leverage Ratio | 2.75 | |
Credit Facility Restriction Available | 100.00% | |
Credit Facility Aggregate Restricted Activities Limit Remaining | 277 | |
Credit Facility Maximum Permitted Acquisitions Remaining | 230 | |
Credit Facility Maximum Oth Investment Purchases Remaining | 97 | |
Line of Credit, Adjusted EBITDA to Interest Expense, Ratio Required | 3 | |
Line of Credit, Leverage Ratio, Maximum | 4.5 | |
Line of Credit, Leverage Ratio, Maximum, As of Covenant Restrictive Effective Date | 4.25 | |
Total Leverage Covenant Restriction Effective Date | 2-Jan-16 | |
Debt Instrument, Covenant Compliance | As of Janaury 2, 2015, the Company was in compliance with all covenants under the Credit Facility. | |
Debt, Weighted Average Interest Rate | 1.57% | |
Debt Instrument, Unused Borrowing Capacity, Amount | $300 |
Debt_Convertible_Notes_and_Int
Debt (Convertible Notes and Interest Rate Swap Details) (Details 2) (USD $) | 0 Months Ended | 1 Months Ended | 12 Months Ended | ||
Feb. 20, 2013 | Mar. 31, 2007 | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | |
Debt Instruments [Abstract] | |||||
Convertible Subordinated Debt | $197,800,000 | ||||
Debt Discount Percentage | 5.00% | ||||
Debt Instrument, Interest Rate, Stated Percentage | 2.25% | ||||
Debt Instrument, Interest Rate During Period | 8.50% | ||||
Debt Redemption Date | 20-Feb-13 | ||||
Derivative [Line Items] | |||||
Interest expense | 4,252,000 | 11,261,000 | 18,054,000 | ||
Interest Rate Swap [Member] | |||||
Derivative [Line Items] | |||||
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net | 0 | 0 | 0 | ||
Interest expense | 500,000 | 500,000 | 0 | ||
Interest Rate Swap 1 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Term | 3 years | ||||
Type of Hedge | Cash flow | ||||
Notional Amount | 100,000,000 | 150,000,000 | |||
Start Date | 20-Feb-13 | ||||
End Date | 22-Feb-16 | ||||
Derivative, Fixed Interest Rate | 0.57% | ||||
Derivative, Variable Interest Rate | 0.16% | ||||
Annual Notional Amortizing Amount | 50,000,000 | ||||
Interest Rate Swap 1 [Member] | Other Liabilities [Member] | |||||
Derivative [Line Items] | |||||
Fair Value | -125,000 | ||||
Interest Rate Swap 2 [Member] | |||||
Derivative [Line Items] | |||||
Type of Hedge | Cash flow | ||||
Notional Amount | 90,000,000 | ||||
Start Date | 20-Feb-15 | ||||
End Date | 20-Sep-19 | ||||
Derivative, Fixed Interest Rate | 1.92% | ||||
Annual Notional Amortizing Amount | 10,000,000 | ||||
Notional amortizing start date | 21-Feb-17 | ||||
Interest Rate Swap 2 [Member] | Other Liabilities [Member] | |||||
Derivative [Line Items] | |||||
Fair Value | -865,000 | ||||
Interest Rate Swap 2a [Member] | |||||
Derivative [Line Items] | |||||
Notional Amount | 45,000,000 | ||||
Start Date | 20-Feb-15 | ||||
Interest Rate Swap 2b [Member] | |||||
Derivative [Line Items] | |||||
Notional Amount | $45,000,000 | ||||
Start Date | 22-Feb-16 |
Debt_Contractual_Interest_and_
Debt (Contractual Interest and Discount Amortization) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Interest Costs Incurred [Abstract] | |||
Contractual interest | $0 | $634 | $4,450 |
Discount amortization | $0 | $5,368 | $11,464 |
Debt_Longterm_Debt_Maturity_Sc
Debt (Long-term Debt Maturity Schedule) (Details 4) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
In Thousands, unless otherwise specified | ||
Long-term Debt, Fiscal Year Maturity [Abstract] | ||
2015 | $11,250 | |
2016 | 16,250 | |
2017 | 20,000 | |
2018 | 20,000 | |
2019 | 120,000 | |
Long-term Debt | $187,500 | $197,500 |
Debt_Deferred_Financing_Fees_D
Debt (Deferred Financing Fees) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 |
Deferred Finance Costs [Roll Forward] | ||
Deferred Finance Costs, Net, Beginning Balance | $3,860 | $2,056 |
Financing costs deferred | 2,802 | |
Write-off during the period | -156 | |
Amortization during the period | -773 | -842 |
Deferred Finance Costs, Net, Ending Balance | $3,087 | $3,860 |
Benefit_Plans_Narrative_Detail
Benefit Plans (Narrative) (Details) (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Defined Contribution And Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Basis Points | 0.50% | ||
Defined Contribution Plan Cash [Member] | |||
Defined Contribution And Benefit Plan Disclosure [Line Items] | |||
Defined Contribution Plan, Employer Matching Contribution, Percent | 35.00% | 35.00% | 35.00% |
Defined Contribution Plan, Maximum Annual Contribution Per Employee, Percent | 6.00% | 6.00% | 6.00% |
Defined Contribution Plan, Cost Recognized | $2.20 | $2 | $2 |
Defined Contribution Plan Stock [Member] | |||
Defined Contribution And Benefit Plan Disclosure [Line Items] | |||
Defined Contribution Plan, Employer Matching Contribution, Percent | 4.00% | ||
Defined Contribution Plan, Employer Discretionary Contribution Amount | 4.2 | 4.8 | 1.9 |
Shares Held In Employee Stock Plan | 602,604 | ||
Education Assistance Program [Member] | |||
Defined Contribution And Benefit Plan Disclosure [Line Items] | |||
Defined Contribution Plan, Cost Recognized | $1.90 | $2 | $2.20 |
Benefit_Plans_Change_in_projec
Benefit Plans (Change in projected benefit obligation) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 |
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | ||
Projected benefit obligation at beginning of year | $2,422 | $16,215 |
Service cost | 203 | 236 |
Interest cost | 75 | 138 |
Prior service cost and plan amendments | 0 | -45 |
Plan participants’ contribution | 36 | 134 |
Actuarial (gain) loss | 630 | -2 |
Benefits transferred in, net | 155 | 434 |
Settlement/curtailment gain | -337 | -14,539 |
Foreign currency translation | -341 | -149 |
Projected benefit obligation at end of year | $2,843 | $2,422 |
Benefit_Plans_Change_in_fair_v
Benefit Plans (Change in fair value of plan assets) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ||
Fair value of plan assets at beginning of year | $731 | $12,269 |
Employer contributions (refund) | -39 | 150 |
Plan participants’ contribution | 36 | 134 |
Actual loss on plan assets | -101 | -26 |
Benefits transferred in, net | 198 | 138 |
Settlements | -337 | -11,780 |
Foreign currency translation | -51 | -154 |
Fair value of plan assets at end of year | 437 | 731 |
Projected benefit obligation in excess of plan assets at end of year | 2,406 | 1,691 |
Defined benefit liability classified as other current liabilities | 25 | 25 |
Defined benefit liability classified as long-term liabilities | 2,381 | 1,666 |
Accumulated benefit obligation at end of year | $1,938 | $1,684 |
Benefit_Plans_Amount_recognize
Benefit Plans (Amount recognized in Accumulated Other Comprehensive Income) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | |||
Net loss occurring during the year | $736 | $25 | |
Amortization of losses | -138 | -722 | |
Prior service cost | -2 | 150 | |
Amortization of prior service cost | -11 | 33 | |
Foreign currency translation | -76 | 224 | |
Pre-tax adjustment | 509 | -290 | |
Taxes | -135 | 18 | |
Net (gain) loss | $374 | ($272) | ($1,685) |
Benefit_Plans_Amortization_to_
Benefit Plans (Amortization to be recognized in Accumulated Other Comprehensive Income) (Details) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Jan. 02, 2015 |
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | |
Amortization of net prior service credit | $11 |
Amortization of net loss | $45 |
Benefit_Plans_Net_Pension_Cost
Benefit Plans (Net Pension Costs) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 |
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | ||
Service cost | $203 | $236 |
Interest cost | 75 | 138 |
Settlements loss | 105 | 0 |
Expected return on assets | -3 | 0 |
Recognized net actuarial loss (gain) | 45 | -1,929 |
Net pension cost (income) | $425 | ($1,555) |
Benefit_Plans_Actuarial_valuat
Benefit Plans (Actuarial valuations) (Details) | 12 Months Ended | ||
Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | |||
Discount rate | 2.30% | 3.40% | |
Salary growth | 3.00% | 3.10% | |
Expected rate of return on assets | 2.30% | 2.50% | |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | |||
Discount rate | 3.40% | 2.10% | 2.50% |
Salary growth | 3.10% | 2.40% | 2.30% |
Expected rate of return on assets | 2.50% | 0.00% | 3.50% |
Benefit_Plans_Plan_assets_comp
Benefit Plans (Plan assets components) (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
In Thousands, unless otherwise specified | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | $437 | $731 | $12,269 |
Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Inputs, Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 437 | 731 | |
Fair Value, Inputs, Level 3 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Insurance Contract [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 437 | 731 | |
Insurance Contract [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Insurance Contract [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 437 | 731 | |
Insurance Contract [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | $0 | $0 |
Benefit_Plans_Estimated_benefi
Benefit Plans (Estimated benefit payments over next ten years) (Details) (USD $) | Jan. 02, 2015 |
In Thousands, unless otherwise specified | |
Defined Benefit Plan, Expected Future Benefit Payments, Fiscal Year Maturity [Abstract] | |
2015 | $47 |
2016 | 67 |
2017 | 124 |
2018 | 113 |
2019 | 177 |
2020-2024 | $866 |
StockBased_Compensation_Narrat
Stock-Based Compensation (Narratives) (Details) (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Stock Options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Maximum term of share based award | 10 years | ||
Closing stock price | $48.66 | ||
Unrecognized compensation cost related to non-vested stock options | $2.10 | ||
Period for recognition | 2 years | ||
Stock Options [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Restricted Stock and Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Period for recognition | 2 years | ||
Tax benefit (expense) from compensation expense | 2.3 | -0.4 | -0.02 |
Total unrecognized compensation cost | 7.7 | ||
Fair value of shares vested | $12.50 | $4 | $1.50 |
Restricted Stock and Restricted Stock Units [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Potential performance based restricted stock units to be issued based on shareholder return | 0 | ||
Restricted Stock and Restricted Stock Units [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 4 years | ||
Potential performance based restricted stock units to be issued based on shareholder return | 716,163 | ||
Restricted Stock And Unit Awards [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Two Thousand Five Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized | 2,450,000 | ||
Number of shares available for grant | 16,799 | ||
Two Thousand Five Plan [Member] | Restricted Stock and Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized | 850,000 | ||
Number of shares available for grant | 3,625 | ||
Two Thousand Nine Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized | 1,350,000 | ||
Number of shares available for grant | 316,695 | ||
Two Thousand Nine Plan [Member] | Restricted Stock and Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized | 200,000 | ||
Number of shares available for grant | 26,594 | ||
Two Thousand Eleven Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized | 1,350,000 | ||
Number of shares available for grant | 575,451 |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation | $13,186 | $14,101 | $10,904 |
Cost of Sales [Member] | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation | 3,530 | 3,864 | 2,620 |
Selling, General and Administrative Expenses [Member] | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation | 7,923 | 7,907 | 7,684 |
Research and Development Expense [Member] | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation | 1,440 | 1,194 | 600 |
Other Operating Expenses, net [Member] | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation | 293 | 1,136 | 0 |
Employee Stock Option [Member] | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation | 2,523 | 3,490 | 2,786 |
Restricted Stock And Unit Awards [Member] | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation | 6,417 | 5,843 | 6,233 |
Defined Contribution Plan Stock [Member] | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation | $4,246 | $4,768 | $1,885 |
StockBased_Compensation_Weight
Stock-Based Compensation (Weighted-Average Fair Value and Assumptions) (Details 1) (USD $) | 12 Months Ended | ||
Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Weighted average grant date fair value | $16.43 | $8.38 | $8.20 |
Risk-free interest rate | 1.73% | 0.73% | 0.83% |
Expected volatility | 39.00% | 39.00% | 40.00% |
Expected life (in years) | 5 years 3 months 18 days | 5 years 3 months 18 days | 5 years 3 months 18 days |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Annual prevesting forfeiture rate | 9.00% | 9.00% | 9.00% |
StockBased_Compensation_TimeVe
Stock-Based Compensation (Time-Vested Stock Option Activity) (Details 2) (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Stock Options Time Based [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||
Stock Options Outstanding, Beginning | 1,616,409 | 1,775,847 | 1,558,771 |
Option Grants in Period, Gross | 183,571 | 372,676 | 395,978 |
Option Exercises in Period | -295,203 | -443,428 | -52,683 |
Option Forfeitures and Expirations in Period | -33,279 | -88,686 | -126,219 |
Stock Options Outstanding, Ending | 1,471,498 | 1,616,409 | 1,775,847 |
Options Expected to Vest, Number | 1,447,519 | ||
Options Exercisable, Number | 1,278,765 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |||
Options Outstanding, Weighted Average Exercise Price, Beginning | $22.92 | $23.17 | $23.42 |
Option Grants in Period, Weighted Average Exercise Price | $43.84 | $23.33 | $22.19 |
Option Exercises in Period, Weighted Average Exercise Price | $23.42 | $23.24 | $20.77 |
Option Forfeitures and Expirations in Period, Weighted Average Exercise Price | $27.82 | $28.05 | $24.21 |
Options Outstanding, Weighted Average Exercise Price, Ending | $25.32 | $22.92 | $23.17 |
Options Expected to Vest, Weighted Average Exercise Price | $25.10 | ||
Options Exercisable, Weighted Average Exercise Price | $23.88 | ||
Options Outstanding, Weighted Average Remaining Contractual Term | 6 years 1 month 6 days | ||
Options Expected to Vest, Weighted Average Remaining Contractual Term | 6 years 1 month 6 days | ||
Options Exercisable, Weighted Average Remaining Contractual Term | 5 years 9 months 18 days | ||
Options Outstanding, Intrinsic Value | $34.30 | ||
Options Expected to Vest, Intrinsic Value | 34.1 | ||
Options Exercisable, Intrinsic Value | 31.7 | ||
Stock Options Performance Based [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||
Stock Options Outstanding, Beginning | 177,261 | 284,925 | 478,364 |
Option Exercises in Period | -58,422 | -107,664 | -7,657 |
Option Forfeitures and Expirations in Period | 0 | 0 | -185,782 |
Stock Options Outstanding, Ending | 118,839 | 177,261 | 284,925 |
Options Expected to Vest, Number | 118,839 | ||
Options Exercisable, Number | 118,839 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |||
Options Outstanding, Weighted Average Exercise Price, Beginning | $23.27 | $23.26 | $24.44 |
Option Exercises in Period, Weighted Average Exercise Price | $23.35 | $23.23 | $22.04 |
Option Forfeitures and Expirations in Period, Weighted Average Exercise Price | $0 | $0 | $26.35 |
Options Outstanding, Weighted Average Exercise Price, Ending | $23.24 | $23.27 | $23.26 |
Options Expected to Vest, Weighted Average Exercise Price | $23.24 | ||
Options Exercisable, Weighted Average Exercise Price | $23.24 | ||
Options Outstanding, Weighted Average Remaining Contractual Term | 3 years 0 months 0 days | ||
Options Expected to Vest, Weighted Average Remaining Contractual Term | 3 years 0 months 0 days | ||
Options Exercisable, Weighted Average Remaining Contractual Term | 3 years 0 months 0 days | ||
Options Outstanding, Intrinsic Value | 3 | ||
Options Expected to Vest, Intrinsic Value | 3 | ||
Options Exercisable, Intrinsic Value | $3 |
StockBased_Compensation_Exerci
Stock-Based Compensation (Exercise of Stock Option) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Intrinsic value | $7,997 | $6,807 | $148 |
Cash received | 8,278 | 12,807 | 1,263 |
Tax benefit (expense) realized | $1,704 | $727 | ($132) |
StockBased_Compensation_Restri
Stock-Based Compensation (Restricted Stock and Restricted Stock Units)(Details) (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Restricted Stock And Restricted Stock Units Time Based [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Nonvested Restricted Stock Units and Awards, Beginning | 67,575 | 80,269 | 69,942 |
Restricted Stock Units and Awards Granted | 63,817 | 67,230 | 92,265 |
Restricted Stock Units and Awards Vested | -53,568 | -74,062 | -74,901 |
Restricted Stock Units and Awards Forfeited | -9,992 | -5,862 | -7,037 |
Nonvested Restricted Stock Units and Awards, Ending | 67,832 | 67,575 | 80,269 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |||
Restricted Stock Units and Awards, Weighted Average Grant Date Fair Value, Beginning | $26.37 | $23.48 | $22.69 |
Restricted Stock Units and Awards Granted, Weighted Average Fair Value | $44.78 | $26.76 | $23.49 |
Restricted Stock Units and Awards Vested, Weighted Average Fair Value | $34.16 | $23.93 | $22.83 |
Restricted Stock Units and Awards Forfeited, Weighted Average Fair Value | $35.30 | $22.26 | $22.56 |
Restricted Stock Units and Awards, Weighted Average Grant Date Fair Value, Ending | $36.22 | $26.37 | $23.48 |
Restricted Stock And Restricted Stock Units Performance Based [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Nonvested Restricted Stock Units and Awards, Beginning | 779,678 | 782,446 | 529,743 |
Restricted Stock Units and Awards Granted | 186,825 | 318,169 | 332,918 |
Restricted Stock Units and Awards Vested | -221,470 | -49,139 | -15,500 |
Restricted Stock Units and Awards Forfeited | -28,870 | -271,798 | -64,715 |
Nonvested Restricted Stock Units and Awards, Ending | 716,163 | 779,678 | 782,446 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |||
Restricted Stock Units and Awards, Weighted Average Grant Date Fair Value, Beginning | $16.41 | $16.02 | $16.68 |
Restricted Stock Units and Awards Granted, Weighted Average Fair Value | $31.33 | $15.86 | $15.30 |
Restricted Stock Units and Awards Vested, Weighted Average Fair Value | $18.51 | $14.68 | $24.64 |
Restricted Stock Units and Awards Forfeited, Weighted Average Fair Value | $18.42 | $14.94 | $15.72 |
Restricted Stock Units and Awards, Weighted Average Grant Date Fair Value, Ending | $19.57 | $16.41 | $16.02 |
Restricted Stock and Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee Service Share-based Compensation, Tax Benefit (Expense) from Vesting of Restricted Stock and Restricted Stock Units | $2.30 | ($0.40) | ($0.02) |
Research_Development_and_Engin2
Research, Development and Engineering Costs (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Research and development expense [Line Items] | |||
Research and Development Expense (Excluding Acquired in Process Cost) | $49,845 | $54,077 | $52,490 |
Research, Development, and Engineering Costs [Member] | |||
Research and development expense [Line Items] | |||
Research and Development Expense (Excluding Acquired in Process Cost) | 58,974 | 62,652 | 62,848 |
Customer Cost Reimbursements [Member] | |||
Research and development expense [Line Items] | |||
Research and Development Expense (Excluding Acquired in Process Cost) | ($9,129) | ($8,575) | ($10,358) |
Other_Operating_Expenses_Net_N
Other Operating Expenses, Net (Narrative) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
Jan. 02, 2015 | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | |
Restructuring Cost and Reserve [Line Items] | ||||
Fair value adjustments | $840,000 | $690,000 | ||
Impairment of Long-Lived Assets to be Disposed of | 400,000 | 900,000 | 3,600,000 | |
Indefinite-lived assets written-off (Note 18) | -500,000 | |||
Relocation costs | 15,297,000 | 15,790,000 | 42,346,000 | |
Investments in Capacity and Capabilities [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Initiation Date | 2014 | |||
Restructuring And Related Activities Capital Expenditures Incurred To Date | 4,000,000 | |||
Restructuring and Related Cost, Cost Incurred to Date | 8,900,000 | 8,900,000 | ||
Investments in Capacity and Capabilities [Member] | Minimum [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring And Related Activities Expected Capital Expenditures | 25,000,000 | |||
Restructuring and Related Cost, Expected Cost | 29,000,000 | 29,000,000 | ||
Investments in Capacity and Capabilities [Member] | Minimum [Member] | Severance And Retention [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 7,000,000 | 7,000,000 | ||
Investments in Capacity and Capabilities [Member] | Minimum [Member] | Accelerated Depreciation And Asset Write Offs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 2,000,000 | 2,000,000 | ||
Investments in Capacity and Capabilities [Member] | Minimum [Member] | Other Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 20,000,000 | 20,000,000 | ||
Investments in Capacity and Capabilities [Member] | Maximum [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring And Related Activities Expected Capital Expenditures | 27,000,000 | |||
Restructuring and Related Cost, Expected Cost | 34,000,000 | 34,000,000 | ||
Investments in Capacity and Capabilities [Member] | Maximum [Member] | Severance And Retention [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 9,000,000 | 9,000,000 | ||
Investments in Capacity and Capabilities [Member] | Maximum [Member] | Accelerated Depreciation And Asset Write Offs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 3,000,000 | 3,000,000 | ||
Investments in Capacity and Capabilities [Member] | Maximum [Member] | Other Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 22,000,000 | 22,000,000 | ||
Operating Unit Realignment [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Initiation Date | 2013 | |||
Initiatives, Expected Period of Completion | 0 months | |||
Restructuring and Related Cost, Cost Incurred to Date | 6,600,000 | 6,600,000 | ||
Operating Unit Realignment [Member] | Severance And Retention [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Cost Incurred to Date | 5,000,000 | 5,000,000 | ||
Operating Unit Realignment [Member] | Other Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Cost Incurred to Date | 1,600,000 | 1,600,000 | ||
Orthopaedic Facility Optimization [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Initiation Date | 2010 | |||
Restructuring and Related Costs, Facility Consolidations | 2 | |||
Defined Benefit Plan, Recognized Net Gain (Loss) Due to Curtailments | 1,900,000 | |||
Impairment of Long-Lived Assets to be Disposed of | 400,000 | |||
Initiatives, Expected Period of Completion | 2 years | |||
Restructuring And Related Activities Capital Expenditures Incurred To Date | 24,800,000 | |||
Restructuring and Related Cost, Cost Incurred to Date | 42,500,000 | 42,500,000 | ||
Assets Transferred to Held for Sale | 2,100,000 | |||
Orthopaedic Facility Optimization [Member] | Minimum [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring And Related Activities Expected Capital Expenditures | 30,000,000 | |||
Restructuring and Related Cost, Expected Cost | 43,000,000 | 43,000,000 | ||
Orthopaedic Facility Optimization [Member] | Minimum [Member] | Severance And Retention [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 11,000,000 | 11,000,000 | ||
Orthopaedic Facility Optimization [Member] | Minimum [Member] | Accelerated Depreciation And Asset Write Offs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 13,000,000 | 13,000,000 | ||
Orthopaedic Facility Optimization [Member] | Minimum [Member] | Other Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 19,000,000 | 19,000,000 | ||
Orthopaedic Facility Optimization [Member] | Maximum [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring And Related Activities Expected Capital Expenditures | 35,000,000 | |||
Restructuring and Related Cost, Expected Cost | 48,000,000 | 48,000,000 | ||
Orthopaedic Facility Optimization [Member] | Maximum [Member] | Other Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 24,000,000 | 24,000,000 | ||
Medical Device Facility Optimization [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Initiation Date | 2011 | |||
Restructuring and Related Costs, Facility Expansions | 2 | |||
Initiatives, Expected Period of Completion | 0 years | |||
Restructuring And Related Activities Capital Expenditures Incurred To Date | 12,500,000 | |||
Restructuring and Related Cost, Cost Incurred to Date | 1,800,000 | 1,800,000 | ||
Medical Device Facility Optimization [Member] | Production Inefficiencies, Moving And Revalidation [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Cost Incurred to Date | 700,000 | 700,000 | ||
Medical Device Facility Optimization [Member] | Personnel [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Cost Incurred to Date | 600,000 | 600,000 | ||
Medical Device Facility Optimization [Member] | Other Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Cost Incurred to Date | 500,000 | 500,000 | ||
ERP System Upgrade [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Initiation Date | 2011 | |||
Initiatives, Expected Period of Completion | 0 months | |||
Restructuring And Related Activities Capital Expenditures Incurred To Date | 4,000,000 | |||
Restructuring and Related Cost, Cost Incurred to Date | 5,700,000 | 5,700,000 | ||
ERP System Upgrade [Member] | Training And Consulting Costs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Cost Incurred to Date | 3,200,000 | 3,200,000 | ||
ERP System Upgrade [Member] | Accelerated Depreciation And Asset Write Offs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Cost Incurred to Date | 2,500,000 | 2,500,000 | ||
Corporate Headquarters Relocation [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Relocation costs | 1,200,000 | |||
In Process Research And Development [Member] | QiG [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Indefinite-lived assets written-off (Note 18) | -540,000 | |||
Swiss Orthopaedic Product Line [Member] | Orthopaedic Facility Optimization [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Impairment of Long-Lived Assets to be Disposed of | 3,600,000 | |||
Disposal Group, Payments Received | 4,700,000 | |||
Liabilities Assumed By Third Parties | 2,400,000 | |||
Assets Held-For-Sale, Expected Gain From Earn-Out Payment | 2,700,000 | |||
Wireless Sensing [Member] | Greatbatch Medical [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Write-off | 900,000 | |||
Executive Vice President [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Severance Costs | $900,000 |
Other_Operating_Expenses_Net_D
Other Operating Expenses, Net (Details) (USD $) | 12 Months Ended | ||
Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | |
Operating Costs and Expenses [Abstract] | |||
Other operating (income) expense, net | $15,297,000 | $15,790,000 | $42,346,000 |
Investments in Capacity and Capabilities [Member] | |||
Operating Costs and Expenses [Abstract] | |||
Other operating (income) expense, net | 8,925,000 | 0 | 0 |
Operating Unit Realignment [Member] | |||
Operating Costs and Expenses [Abstract] | |||
Other operating (income) expense, net | 1,017,000 | 5,625,000 | 0 |
Orthopaedic facility optimization [Member] | |||
Operating Costs and Expenses [Abstract] | |||
Other operating (income) expense, net | 1,317,000 | 8,038,000 | 32,482,000 |
Medical device facility optimization [Member] | |||
Operating Costs and Expenses [Abstract] | |||
Other operating (income) expense, net | 11,000 | 312,000 | 1,525,000 |
ERP system upgrade [Member] | |||
Operating Costs and Expenses [Abstract] | |||
Other operating (income) expense, net | -82,000 | 783,000 | 5,041,000 |
Integration costs [Member] | |||
Operating Costs and Expenses [Abstract] | |||
Other operating (income) expense, net | 3,000 | -502,000 | 1,460,000 |
Asset dispositions severance and other [Member] | |||
Operating Costs and Expenses [Abstract] | |||
Other operating (income) expense, net | 4,106,000 | 1,534,000 | 1,838,000 |
Operating Unit Realignment [Member] | |||
Other Operating Income Expense Detail [Line Items] | |||
Restructuring and Related Cost, Cost Incurred to Date | 6,600,000 | ||
Orthopaedic Facility Optimization [Member] | |||
Other Operating Income Expense Detail [Line Items] | |||
Restructuring and Related Cost, Cost Incurred to Date | 42,500,000 | ||
Medical Device Facility Optimization [Member] | |||
Other Operating Income Expense Detail [Line Items] | |||
Restructuring and Related Cost, Cost Incurred to Date | 1,800,000 | ||
ERP System Upgrade [Member] | |||
Other Operating Income Expense Detail [Line Items] | |||
Restructuring and Related Cost, Cost Incurred to Date | $5,700,000 |
Other_Operating_Expenses_Net_C
Other Operating Expenses, Net (Changes in Accrued Liabilities) (Details) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Jan. 02, 2015 |
Investments in Capacity and Capabilities [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | $0 |
Restructuring charges | 8,925 |
Write-offs | -33 |
Cash payments | -6,663 |
Restructuring Reserve, Ending balance | 2,229 |
Operating Unit Realignment [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 1,211 |
Restructuring charges | 1,017 |
Cash payments | -2,228 |
Restructuring Reserve, Ending balance | 0 |
Orthopaedic Facility Optimization [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 857 |
Restructuring charges | 1,317 |
Write-offs | -400 |
Cash payments | -1,487 |
Restructuring Reserve, Ending balance | 287 |
Medical Device Facility Optimization [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | 11 |
Cash payments | -11 |
Restructuring Reserve, Ending balance | 0 |
ERP System Upgrade [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | -82 |
Cash payments | 82 |
Restructuring Reserve, Ending balance | 0 |
Severance And Retention [Member] | Investments in Capacity and Capabilities [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | 2,209 |
Cash payments | -1,046 |
Restructuring Reserve, Ending balance | 1,163 |
Severance And Retention [Member] | Operating Unit Realignment [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 465 |
Restructuring charges | 849 |
Cash payments | -1,314 |
Restructuring Reserve, Ending balance | 0 |
Severance And Retention [Member] | Orthopaedic Facility Optimization [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | 0 |
Write-offs | 0 |
Cash payments | 0 |
Restructuring Reserve, Ending balance | 0 |
Production Inefficiencies, Moving And Revalidation [Member] | Medical Device Facility Optimization [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | 0 |
Cash payments | 0 |
Restructuring Reserve, Ending balance | 0 |
Training And Consulting Costs [Member] | ERP System Upgrade [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | -82 |
Cash payments | 82 |
Restructuring Reserve, Ending balance | 0 |
Accelerated Depreciation And Asset Write Offs [Member] | Investments in Capacity and Capabilities [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | 33 |
Write-offs | -33 |
Cash payments | 0 |
Restructuring Reserve, Ending balance | 0 |
Accelerated Depreciation And Asset Write Offs [Member] | Orthopaedic Facility Optimization [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | -2,255 |
Write-offs | -400 |
Cash payments | 2,655 |
Restructuring Reserve, Ending balance | 0 |
Accelerated Depreciation And Asset Write Offs [Member] | ERP System Upgrade [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | 0 |
Cash payments | 0 |
Restructuring Reserve, Ending balance | 0 |
Personnel [Member] | Medical Device Facility Optimization [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | 1 |
Cash payments | -1 |
Restructuring Reserve, Ending balance | 0 |
Other Restructuring [Member] | Investments in Capacity and Capabilities [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | 6,683 |
Cash payments | -5,617 |
Restructuring Reserve, Ending balance | 1,066 |
Other Restructuring [Member] | Operating Unit Realignment [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 746 |
Restructuring charges | 168 |
Cash payments | -914 |
Restructuring Reserve, Ending balance | 0 |
Other Restructuring [Member] | Orthopaedic Facility Optimization [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 857 |
Restructuring charges | 3,572 |
Write-offs | 0 |
Cash payments | -4,142 |
Restructuring Reserve, Ending balance | 287 |
Other Restructuring [Member] | Medical Device Facility Optimization [Member] | |
Restructuring Reserve [Roll Forward] | |
Restructuring Reserve, Beginning balance | 0 |
Restructuring charges | 10 |
Cash payments | -10 |
Restructuring Reserve, Ending balance | $0 |
Income_Taxes_Narratives_Detail
Income Taxes (Narratives) (Details) (USD $) | Jan. 02, 2015 |
In Millions, unless otherwise specified | |
Income Tax Disclosure [Abstract] | |
Reasonably possible reduction within next 12 months | $1 |
Unrecognized tax benefit | $2.10 |
Income_Taxes_Income_Before_Inc
Income Taxes (Income Before Income Tax Domestic And Foreign) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Income Tax Disclosure [Line Items] | |||
Income (loss) from continuing operations before income taxes | $76,579 | $48,838 | $6,730 |
UNITED STATES [Member] | |||
Income Tax Disclosure [Line Items] | |||
Income (loss) from continuing operations before income taxes | 56,801 | 42,392 | 36,057 |
International [Member] | |||
Income Tax Disclosure [Line Items] | |||
Income (loss) from continuing operations before income taxes | $19,778 | $6,446 | ($29,327) |
Income_Taxes_Provision_Benefit
Income Taxes (Provision Benefit of Income Taxes) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Current: | |||
Federal | $16,293 | $39,353 | $4,747 |
State | 1,299 | 1,604 | 381 |
International | 2,998 | 1,470 | 668 |
Total | 20,590 | 42,427 | 5,796 |
Deferred: | |||
Federal | 1,211 | -28,678 | 6,615 |
State | -310 | 427 | 175 |
International | -370 | -1,605 | -1,057 |
Total | 531 | -29,856 | 5,733 |
Provision for income taxes | $21,121 | $12,571 | $11,529 |
Income_Taxes_Effect_Tax_Rate_R
Income Taxes (Effect Tax Rate Reconciliation) (Details) | 12 Months Ended | ||
Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | |
Income Tax Disclosure [Abstract] | |||
Statutory rate | 35.00% | 35.00% | 35.00% |
Federal tax credits | -2.10% | -7.50% | 0.00% |
Foreign rate differential | -4.30% | -0.70% | 50.70% |
Uncertain tax positions | 0.60% | 1.70% | -10.10% |
State taxes, net of federal benefit | 0.70% | 2.30% | 4.90% |
Change in tax rate - loss of Swiss tax holiday | 0.00% | 0.00% | 25.60% |
Change in foreign tax rates | -0.60% | -3.70% | 0.00% |
Valuation allowance | -0.40% | 0.40% | 67.60% |
Other | -1.30% | -1.80% | -2.40% |
Effective tax rate | 27.60% | 25.70% | 171.30% |
Income_Taxes_Deferred_Tax_Asse
Income Taxes (Deferred Tax Assets and Liabilities) (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
In Thousands, unless otherwise specified | ||
Components of Deferred Tax Assets and Liabilities [Abstract] | ||
Tax credits | $5,828 | $6,624 |
Net operating loss carryforwards | 6,721 | 9,161 |
Inventories | 3,335 | 4,202 |
Accrued expenses | 4,338 | 4,303 |
Stock-based compensation | 9,341 | 9,194 |
Other | 1,659 | 573 |
Gross deferred tax assets | 31,222 | 34,057 |
Less valuation allowance | -10,709 | -11,661 |
Net deferred tax assets | 20,513 | 22,396 |
Property, plant and equipment | -2,646 | -2,254 |
Intangible assets | -57,850 | -57,648 |
Convertible subordinated notes | -5,006 | -6,178 |
Gross deferred tax liabilities | -65,502 | -66,080 |
Net deferred tax liability | ($44,989) | ($43,684) |
Income_Taxes_Deferred_Tax_Asse1
Income Taxes (Deferred Tax Assets and Liabilities Current Noncurrent) (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
In Thousands, unless otherwise specified | ||
Components of Deferred Tax Assets and Liabilities [Abstract] | ||
Current deferred tax asset | $6,168 | $6,008 |
Current deferred tax liability | -588 | -613 |
Noncurrent deferred tax asset | 2,626 | 2,933 |
Noncurrent deferred tax liability | -53,195 | -52,012 |
Net deferred tax liability | ($44,989) | ($43,684) |
Income_Taxes_Income_Tax_Carry_
Income Taxes (Income Tax Carry Forward) (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Jan. 02, 2015 | |
International [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Operating Loss Carryforwards | $48 | [1] |
Operating Loss Carryforwards, Expiration Dates | 1-Jan-15 | |
State [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Operating Loss Carryforwards | 37.6 | [1] |
Research Tax Credit Carryforward [Member] | US and State [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Tax Credit Carryforward, Amount | 0.7 | [1] |
Investment Tax Credit Carryforward [Member] | State [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Tax Credit Carryforward, Amount | $5.30 | |
[1] | The utilization of certain net operating losses and credits is subject to an annual limitation under Internal Revenue Code Section 382. |
Income_Taxes_Unrecognized_Tax_
Income Taxes (Unrecognized Tax Benefits) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance, beginning of year | $1,858 | $970 | $1,580 |
Additions based upon tax positions related to the current year | 268 | 325 | 0 |
Additions related to prior period tax positions | 510 | 651 | 210 |
Reductions relating to settlements with tax authorities | -225 | -88 | -522 |
Reductions as a result of a lapse of applicable statute of limitations | 0 | 0 | -298 |
Balance, end of year | $2,411 | $1,858 | $970 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Narratives) (Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | |||
Dec. 03, 2014 | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | Dec. 21, 2012 | Jan. 29, 2015 | |
Loss Contingencies [Line Items] | ||||||
Loss Contingency, Date of Dismissal | 3-Dec-14 | |||||
Loss contingency, opinion of counsel | The Company has not recorded a reserve in connection with this matter since any potential loss is not probable. | |||||
Direct Operating Costs [Abstract] | ||||||
Direct operating cost, royalty expense | $3,300,000 | $3,500,000 | $3,100,000 | |||
Standard Product Warranty Disclosure [Abstract] | ||||||
Standard product warranty description | Product Warranties – The Company generally warrants that its products will meet customer specifications and will be free from defects in materials and workmanship. | |||||
Maximum loss per associate under stop loss insurance | 225,000 | |||||
Accrued self insured medical plan liability | 1,800,000 | 1,600,000 | ||||
Purchase commitment, description | Purchase Commitments – Contractual obligations for purchase of goods or services are defined as agreements that are enforceable and legally binding on the Company and that specify all significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction. The Company’s purchase orders are normally based on its current manufacturing needs and are fulfilled by its vendors within short time horizons. The Company enters into blanket orders with vendors that have preferred pricing and terms, however these orders are normally cancelable by us without penalty. As of January 2, 2015, the total contractual obligation related to such expenditures is approximately $36.4 million and will primarily be financed by existing cash and cash equivalents, cash generated from operations, or the Credit Facility. The Company also enters into contracts for outsourced services; however, the obligations under these contracts were not significant and the contracts generally contain clauses allowing for cancellation without significant penalty. | |||||
Purchase obligation | 36,400,000 | |||||
Litigation One [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency, lawsuit filing date | December 21, 2012 | |||||
Customer Product Liability Insurance Coverage | 5,000,000 | |||||
Product Liability Insurance Coverage | $10,000,000 | |||||
Subsequent Event [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Loss Contingency, Settlement Agreement, Date | 29-Jan-15 |
Commitments_and_Contingencies_2
Commitments and Contingencies (Change in product warranty liability) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Beginning balance | $1,819 | $2,626 |
Additions to warranty reserve | 953 | 1,624 |
Warranty claims paid | -2,112 | -2,431 |
Ending balance | $660 | $1,819 |
Commitments_and_Contingencies_3
Commitments and Contingencies (Operating Lease Expenses) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Commitments and Contingencies Disclosure [Abstract] | |||
Operating lease expense | $4,281 | $4,379 | $4,024 |
Commitments_and_Contingencies_4
Commitments and Contingencies (Minimum future estimated annual operating lease expense) (Details) (USD $) | Jan. 02, 2015 |
In Thousands, unless otherwise specified | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2015 | $5,797 |
2016 | 5,952 |
2017 | 3,908 |
2018 | 3,489 |
2019 | 3,418 |
Thereafter | 13,938 |
Total estimated operating lease expense | $36,502 |
Commitments_and_Contingencies_5
Commitments and Contingencies (Foreign currency contracts) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Foreign Currency Cash Flow Hedges [Abstract] | |||
Reduction in Cost of Sales | ($168) | ($1,154) | ($79) |
Ineffective portion of change in fair value | 0 | 0 | 0 |
FX Contract 1 [Member] | |||
Derivative [Line Items] | |||
Derivative, Type of Instrument | FX Contract | ||
Aggregate Notional Amount | 16,880 | ||
Start Date | 1-Jan-15 | ||
End Date | 31-Dec-15 | ||
$/Peso | 0.0734 | ||
Foreign Currency Cash Flow Hedge Liability at Fair Value | $1,568 | ||
Balance Sheet Location | Accrued Expenses |
Earnings_Loss_Per_Share_Detail
Earnings (Loss) Per Share (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Jan. 02, 2015 | Oct. 03, 2014 | Jul. 04, 2014 | Apr. 04, 2014 | Jan. 03, 2014 | Sep. 27, 2013 | Jun. 28, 2013 | Mar. 29, 2013 | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Numerator for basic EPS: | |||||||||||
Net income (loss) | $55,458 | $36,267 | ($4,799) | ||||||||
Denominator for basic EPS: | |||||||||||
Weighted average shares outstanding | 24,825 | 23,991 | 23,584 | ||||||||
Effect of dilutive securities stock options, restricted stock and restricted stock units | 1,150 | 1,332 | 0 | ||||||||
Denominator for diluted EPS | 25,975 | 25,323 | 23,584 | ||||||||
Basic (in dollars per share) | $0.57 | $0.56 | $0.50 | $0.61 | $0.40 | $0.46 | $0.41 | $0.24 | $2.23 | $1.51 | ($0.20) |
Diluted (in dollars per share) | $0.54 | $0.54 | $0.48 | $0.58 | $0.38 | $0.44 | $0.39 | $0.23 | $2.14 | $1.43 | ($0.20) |
Earnings_Loss_Per_Share_Antidi
Earnings (Loss) Per Share (Antidilutive Securities) (Details) | 12 Months Ended | ||
Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | |
Anitdilutive Securities Excluded From Earnings Per Share [Abstract] | |||
Time-vested stock options, restricted stock and restricted stock units | 175,549 | 18,480 | 2,142,000 |
Performance-vested stock options and restricted stock units | 0 | 0 | 781,000 |
Incremental Common Shares Attributable to Dilutive Effect of Conversion of Debt Securities | 0 |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Income (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Adjustment, before Tax, [Abstract] | |||
Defined Benefit Plan Liability, Beginning | ($672) | ($962) | |
Net defined benefit plan liability adjustments | -509 | 290 | |
Defined Benefit Plan Liability, Ending | -1,181 | -672 | -962 |
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, before Tax [Abstract] | |||
Cash Flow Hedges, Beginning | -468 | 120 | |
Unrealized gain (loss) on cash flow hedges | -2,372 | 58 | |
Realized Gain (Loss) On Foreign Currency Contracts Before Tax | -168 | -1,154 | |
Realized Gain (Loss) On Interest Rate Swaps Before Tax | 450 | 508 | |
Cash Flow Hedges, End | -2,558 | -468 | 120 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, before Tax [Abstract] | |||
Foreign Currency Translation Adjustment, Beginning | 14,952 | 13,431 | |
Net foreign currency translation gain (loss) | -3,502 | 1,521 | |
Foreign Currency Translation Adjustment, End | 11,450 | 14,952 | 13,431 |
Other Comprehensive Income (Loss), before Tax [Abstract] | |||
Total Pre-Tax Amount, Beginning | 13,812 | 12,589 | |
Unrealized gain (loss) on cash flow hedges | -2,372 | 58 | |
Realized Gain (Loss) On Foreign Currency Contracts Before Tax | -168 | -1,154 | |
Realized Gain (Loss) On Interest Rate Swaps Before Tax | 450 | 508 | |
Net defined benefit plan liability adjustments | -509 | 290 | |
Net foreign currency translation gain (loss) | -3,502 | 1,521 | |
Total Pre-Tax Amount, End | 7,711 | 13,812 | 12,589 |
Other Comprehensive Income (Loss), Tax [Abstract] | |||
Tax, Beginning | 546 | 358 | |
Unrealized gain (loss) on cash flow hedges | 829 | -20 | |
Other Comprehensive Income Realized Gain Loss On Foreign Currency Hedges Tax | 59 | 404 | |
Realized Gain (Loss) On Interest Rate Swaps Tax | -157 | -178 | |
Net defined benefit plan liability adjustments | 135 | -18 | |
Net foreign currency translation gain (loss) | 0 | 0 | |
Tax, End | 1,412 | 546 | 358 |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Net-of-Tax Amount, Beginning | 14,358 | 12,947 | |
Unrealized gain (loss) on cash flow hedges, net of tax | -1,543 | 38 | |
Realized Gain (Loss) On Foreign Currency Contracts Net Of Tax | -109 | -750 | |
Realized Gain (Loss) On Interest Rate Swaps Net Of Tax | 293 | 330 | |
Net defined benefit plan liability adjustments | -374 | 272 | 1,685 |
Foreign currency translation gain (loss) | -3,502 | 1,521 | 1,905 |
Net-of-Tax Amount, End | $9,123 | $14,358 | $12,947 |
Fair_Value_Measurement_Narrati
Fair Value Measurement (Narratives) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
Jan. 02, 2015 | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||
Foreign currency cash flow hedge gain (loss) to be reclassified during next 12 months | $1,600,000 | $1,600,000 | ||
Contingent consideration liability | 0 | 0 | 840,000 | 1,530,000 |
Cost and equity method investments aggregate carrying amount | 14,500,000 | 14,500,000 | 12,300,000 | |
Cost-method investments, realized gains | 3,200,000 | |||
Income (Loss) from Equity Method Investments | 1,200,000 | -200,000 | -300,000 | |
Impairment of Long-Lived Assets to be Disposed of | 400,000 | 900,000 | 3,600,000 | |
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | 500,000 | |||
Fair Value, Inputs, Level 2 [Member] | ||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||
Contingent consideration liability | 0 | |||
Cost and equity method investments other than temporary impairment | 0 | 500,000 | 100,000 | |
Financial Milestones [Member] | ||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||
Contingent consideration liability | 0 | 0 | ||
Development Milestones [Member] | ||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||
Contingent consideration liability | $0 | $0 | ||
Chinese Venture Capital Fund [Member] | ||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||
Equity Method Investment, Ownership Percentage | 7.40% | 7.40% |
Fair_Value_Measurement_Accrued
Fair Value Measurement (Accrued Contingent Consideration) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 |
Contingent Consideration Liability [Roll Forward] | ||
Contingent consideration liability, beginning balance | $840 | $1,530 |
Fair value adjustments | -840 | -690 |
Contingent consideration liability, ending balance | $0 | $840 |
Fair_Value_Measurement_Assets_
Fair Value Measurement (Assets and Liabilities Recorded at Fair Value on a Recurring Basis) (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration liability | $0 | $840,000 | $1,530,000 |
Fair Value, Measurements, Recurring [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Foreign Currency Contracts, Liability, Fair Value Disclosure | 1,568,000 | 140,000 | |
Interest rate swap | 990,000 | 328,000 | |
Fair Value, Inputs, Level 1 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration liability | 0 | ||
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Foreign Currency Contracts, Liability, Fair Value Disclosure | 0 | 0 | |
Interest rate swap | 0 | 0 | |
Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration liability | 0 | ||
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Foreign Currency Contracts, Liability, Fair Value Disclosure | 1,568,000 | 140,000 | |
Interest rate swap | 990,000 | 328,000 | |
Fair Value, Inputs, Level 3 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration liability | 840,000 | ||
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Foreign Currency Contracts, Liability, Fair Value Disclosure | 0 | 0 | |
Interest rate swap | $0 | $0 |
Fair_Value_Measurements_Assets
Fair Value Measurements (Assets and Liabilities Measured on Non-recurring Basis) (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 |
In Thousands, unless otherwise specified | ||
Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign Currency Contracts, Liability, Fair Value Disclosure | $1,568 | $140 |
Fair Value, Measurements, Nonrecurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets Held for Sale (Note 5) | 1,635 | 0 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign Currency Contracts, Liability, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Nonrecurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets Held for Sale (Note 5) | 0 | |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign Currency Contracts, Liability, Fair Value Disclosure | 1,568 | 140 |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Nonrecurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets Held for Sale (Note 5) | 1,635 | |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign Currency Contracts, Liability, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Nonrecurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets Held for Sale (Note 5) | $0 |
Business_Segment_Geographic_an2
Business Segment, Geographic and Concentration Risk Information (Narrative) (Details) | 12 Months Ended |
Jan. 02, 2015 | |
Segment | |
Noncontrolling Interest [Line Items] | |
Number of Reportable Segments | 2 |
QiG [Member] | |
Noncontrolling Interest [Line Items] | |
Controlling Interest, Number of Ownership Interests | 3 |
Controlling Interest, Liability of Expenses Incurred, Percentage | 100.00% |
CE Approval Date | 17-Jun-14 |
QiG [Member] | Minimum [Member] | |
Noncontrolling Interest [Line Items] | |
Controlling Interest, Ownership Percentage | 89.00% |
QiG [Member] | Maximum [Member] | |
Noncontrolling Interest [Line Items] | |
Controlling Interest, Ownership Percentage | 100.00% |
Recovered_Sheet1
Business Segment, Geographic And Concentration Risk Information (Sales by Product Lines) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Oct. 03, 2014 | Jul. 04, 2014 | Apr. 04, 2014 | Jan. 03, 2014 | Sep. 27, 2013 | Jun. 28, 2013 | Mar. 29, 2013 | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | $169,726 | $171,699 | $172,081 | $174,281 | $176,619 | $167,730 | $171,331 | $148,265 | $687,787 | $663,945 | $646,177 |
Greatbatch Medical [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | 678,285 | 660,902 | 643,722 | ||||||||
Greatbatch Medical [Member] | Cardiac Neuromodulation [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | 321,419 | 325,412 | 306,669 | ||||||||
Greatbatch Medical [Member] | Orthopaedic [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | 147,296 | 130,247 | 122,061 | ||||||||
Greatbatch Medical [Member] | Portable Medical [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | 69,043 | 78,743 | 81,659 | ||||||||
Greatbatch Medical [Member] | Vascular [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | 58,770 | 48,357 | 51,980 | ||||||||
Greatbatch Medical [Member] | Energy [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | 81,757 | 78,143 | 81,353 | ||||||||
QiG [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | $9,502 | $3,043 | $2,455 |
Recovered_Sheet2
Business Segment, Geographic And Concentration Risk Information (Reconciliation of Segment Information) (Details 1) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Segment Reporting Information [Line Items] | |||
Operating income as reported | $75,654 | $61,339 | $25,821 |
Unallocated other income (expense), net | 925 | -12,501 | -19,091 |
Income before provision for income taxes | 76,579 | 48,838 | 6,730 |
Depreciation And Amortization Including Noncash Debt Amortization | 38,230 | 42,332 | 58,925 |
Segment Reporting Information, Expenditures for Additions to Long-Lived Assets | 25,646 | 18,174 | 41,166 |
Total assets | 956,009 | 890,703 | 889,875 |
Greatbatch Medical [Member] | |||
Segment Reporting Information [Line Items] | |||
Operating income as reported | 126,312 | 111,805 | 79,093 |
Depreciation And Amortization Including Noncash Debt Amortization | 31,906 | 31,112 | 39,820 |
Segment Reporting Information, Expenditures for Additions to Long-Lived Assets | 19,006 | 13,242 | 33,249 |
Total assets | 761,225 | 758,369 | 779,890 |
QiG [Member] | |||
Segment Reporting Information [Line Items] | |||
Operating income as reported | -23,256 | -30,484 | -32,554 |
Depreciation And Amortization Including Noncash Debt Amortization | 2,101 | 1,539 | 630 |
Segment Reporting Information, Expenditures for Additions to Long-Lived Assets | 1,453 | 2,134 | 3,208 |
Total assets | 76,529 | 56,245 | 57,750 |
Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Operating income as reported | 103,056 | 81,321 | 46,539 |
Depreciation And Amortization Including Noncash Debt Amortization | 34,007 | 32,651 | 40,450 |
Segment Reporting Information, Expenditures for Additions to Long-Lived Assets | 20,459 | 15,376 | 36,457 |
Total assets | 837,754 | 814,614 | 837,640 |
Unallocated Amount to Segment [Member] | |||
Segment Reporting Information [Line Items] | |||
Operating income as reported | -27,402 | -19,982 | -20,718 |
Depreciation And Amortization Including Noncash Debt Amortization | 4,223 | 9,681 | 18,475 |
Segment Reporting Information, Expenditures for Additions to Long-Lived Assets | 5,187 | 2,798 | 4,709 |
Total assets | $118,255 | $76,089 | $52,235 |
Recovered_Sheet3
Business Segment, Geographic And Concentration Risk Information (Sales by Geographic Information) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Oct. 03, 2014 | Jul. 04, 2014 | Apr. 04, 2014 | Jan. 03, 2014 | Sep. 27, 2013 | Jun. 28, 2013 | Mar. 29, 2013 | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | $169,726 | $171,699 | $172,081 | $174,281 | $176,619 | $167,730 | $171,331 | $148,265 | $687,787 | $663,945 | $646,177 |
UNITED STATES [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | 312,539 | 325,090 | 330,537 | ||||||||
PUERTO RICO [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | 127,702 | 117,961 | 105,731 | ||||||||
BELGIUM [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | 65,308 | 67,155 | 58,043 | ||||||||
Rest Of World [Member] | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Sales Revenue, Net | $182,238 | $153,739 | $151,866 |
Business_Segment_Geographic_An3
Business Segment, Geographic And Concentration Risk Information (Long lived Tangible Assets by Region) (Details) (USD $) | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
In Thousands, unless otherwise specified | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Long-lived tangible assets | $144,925 | $145,773 | $150,893 |
UNITED STATES [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Long-lived tangible assets | 113,851 | 116,484 | 123,104 |
Rest Of World [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Long-lived tangible assets | $31,074 | $29,289 | $27,789 |
Business_Segment_Geographic_An4
Business Segment, Geographic And Concentration Risk Information (Significant Customers) (Details) | 12 Months Ended | ||
Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | |
Revenue, Major Customer [Line Items] | |||
Entity-Wide Revenue, Major Customer, Percentage | 54.00% | 56.00% | 52.00% |
Entity Wide Accounts Receivable, Major Customer, Percentage | 47.00% | 46.00% | |
Customer A [Member] | |||
Revenue, Major Customer [Line Items] | |||
Entity-Wide Revenue, Major Customer, Percentage | 18.00% | 20.00% | 19.00% |
Entity Wide Accounts Receivable, Major Customer, Percentage | 4.00% | 8.00% | |
Customer B [Member] | |||
Revenue, Major Customer [Line Items] | |||
Entity-Wide Revenue, Major Customer, Percentage | 18.00% | 16.00% | 16.00% |
Entity Wide Accounts Receivable, Major Customer, Percentage | 23.00% | 19.00% | |
Customer C [Member] | |||
Revenue, Major Customer [Line Items] | |||
Entity-Wide Revenue, Major Customer, Percentage | 12.00% | 13.00% | 11.00% |
Entity Wide Accounts Receivable, Major Customer, Percentage | 8.00% | 8.00% | |
Customer D [Member] | |||
Revenue, Major Customer [Line Items] | |||
Entity-Wide Revenue, Major Customer, Percentage | 6.00% | 7.00% | 6.00% |
Entity Wide Accounts Receivable, Major Customer, Percentage | 12.00% | 11.00% |
Quarterly_Sales_and_Earnings_D2
Quarterly Sales and Earnings Data - Unaudited (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Jan. 02, 2015 | Oct. 03, 2014 | Jul. 04, 2014 | Apr. 04, 2014 | Jan. 03, 2014 | Sep. 27, 2013 | Jun. 28, 2013 | Mar. 29, 2013 | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Sales | $169,726 | $171,699 | $172,081 | $174,281 | $176,619 | $167,730 | $171,331 | $148,265 | $687,787 | $663,945 | $646,177 |
Gross profit | 57,214 | 58,118 | 58,470 | 57,596 | 57,385 | 55,877 | 57,302 | 48,749 | 231,398 | 219,313 | 201,649 |
Net income | $14,176 | $14,012 | $12,348 | $14,922 | $9,781 | $11,071 | $9,752 | $5,663 | $55,458 | $36,267 | ($4,799) |
Earnings Per Share, Basic (in dollars per share) | $0.57 | $0.56 | $0.50 | $0.61 | $0.40 | $0.46 | $0.41 | $0.24 | $2.23 | $1.51 | ($0.20) |
Earnings Per Share, Diluted (in dollars per share) | $0.54 | $0.54 | $0.48 | $0.58 | $0.38 | $0.44 | $0.39 | $0.23 | $2.14 | $1.43 | ($0.20) |
Valuation_and_Qualifying_Accou1
Valuation and Qualifying Accounts (Details) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Jan. 02, 2015 | Jan. 03, 2014 | Dec. 28, 2012 | |||
Allowance for Doubtful Accounts [Member] | ||||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||||
Balance at Beginning of Period | $2,001 | $2,372 | $1,930 | |||
Charged to Cost and Expenses | 98 | -93 | 484 | |||
Charged to Other Accounts | 14 | [1],[2] | -15 | [1] | 71 | [1],[2] |
Deductions | -702 | [3] | -263 | [3] | -113 | [3] |
Balance at End of Period | 1,411 | 2,001 | 2,372 | |||
Valuation Allowance of Deferred Tax Assets [Member] | ||||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||||
Balance at Beginning of Period | 11,661 | 12,768 | 7,775 | |||
Charged to Cost and Expenses | -729 | [4] | -1,263 | [4] | 5,145 | [4] |
Charged to Other Accounts | 0 | [1] | 32 | [1] | 124 | [1] |
Deductions | -223 | [4],[5] | 124 | [4] | -276 | [5] |
Balance at End of Period | $10,709 | $11,661 | $12,768 | |||
[1] | Includes foreign currency translation effect. | |||||
[2] | Balance recorded as a part of our 2014 acquisition of Centro de Construcción de Cardioestimuladores del Uruguay and our 2012 acquisition of NeuroNexus Technologies, Inc. | |||||
[3] | Accounts written off. | |||||
[4] | Valuation allowance recorded in the provision for income taxes for certain net operating losses and tax credits. The net decrease in allowance in 2014 and 2013 primarily relates to the use of net operating loss carryforwards. | |||||
[5] | Primarily relates to return to provision adjustments for prior years. |