Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2019 | Oct. 25, 2019 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2019 | |
Document Transition Report | false | |
Entity File Number | 1-37774 | |
Entity Registrant Name | AdvanSix Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 81-2525089 | |
Entity Address, Address Line One | 300 Kimball Drive | |
Entity Address, Address Line Two | Suite 101 | |
Entity Address, City or Town | Parsippany | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 07054 | |
City Area Code | 973 | |
Local Phone Number | 526-1800 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | ASIX | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 27,912,355 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001673985 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Statement [Abstract] | ||||
Sales | $ 310,633 | $ 368,653 | $ 970,743 | $ 1,128,350 |
Costs, expenses and other: | ||||
Costs of goods sold | 280,123 | 343,434 | 850,131 | 1,007,712 |
Selling, general and administrative expenses | 19,261 | 18,057 | 58,683 | 55,189 |
Other non-operating expense (income), net | 1,815 | 1,453 | 4,871 | 6,581 |
Total costs, expenses and other | 301,199 | 362,944 | 913,685 | 1,069,482 |
Income before taxes | 9,434 | 5,709 | 57,058 | 58,868 |
Income tax expense | 1,513 | 229 | 13,617 | 13,385 |
Net income | $ 7,921 | $ 5,480 | $ 43,441 | $ 45,483 |
Earnings per common share | ||||
Basic (in dollars per share) | $ 0.29 | $ 0.18 | $ 1.54 | $ 1.50 |
Diluted (in dollars per share) | $ 0.28 | $ 0.18 | $ 1.49 | $ 1.46 |
Weighted average common shares outstanding | ||||
Basic (in shares) | 27,608,985 | 30,160,991 | 28,192,760 | 30,375,873 |
Diluted (in shares) | 28,581,451 | 30,983,834 | 29,164,024 | 31,189,640 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 7,921 | $ 5,480 | $ 43,441 | $ 45,483 |
Foreign exchange translation adjustment | (20) | (8) | (17) | (26) |
Cash-flow hedges | (439) | 0 | (1,060) | 0 |
Pension obligation adjustments | 0 | 0 | 0 | 410 |
Other comprehensive income (loss), net of tax | (459) | (8) | (1,077) | 384 |
Comprehensive income | $ 7,462 | $ 5,472 | $ 42,364 | $ 45,867 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 10,048 | $ 9,808 |
Accounts and other receivables – net | 109,292 | 160,266 |
Inventories – net | 162,479 | 137,182 |
Other current assets | 8,433 | 3,807 |
Total current assets | 290,252 | 311,063 |
Property, plant and equipment – net | 731,643 | 672,210 |
Operating lease right-of-use assets | 136,122 | 0 |
Goodwill | 15,005 | 15,005 |
Other assets | 38,795 | 36,348 |
Total assets | 1,211,817 | 1,034,626 |
Current liabilities: | ||
Accounts payable | 219,225 | 231,720 |
Accrued liabilities | 29,839 | 30,448 |
Operating lease liabilities – short-term | 35,656 | 0 |
Deferred income and customer advances | 1,948 | 22,556 |
Total current liabilities | 286,668 | 284,724 |
Deferred income taxes | 112,579 | 103,783 |
Operating lease liabilities – long-term | 100,752 | 0 |
Line of credit – long-term | 266,000 | 200,000 |
Postretirement benefit obligations | 22,581 | 21,080 |
Other liabilities | 6,011 | 4,701 |
Total liabilities | 794,591 | 614,288 |
COMMITMENTS AND CONTINGENCIES (Note 9) | ||
STOCKHOLDERS' EQUITY | ||
Common stock, par value $0.01; 200,000,000 shares authorized; 30,600,708 shares issued and 27,481,162 outstanding at September 30, 2019; 30,555,715 shares issued and 29,345,001 outstanding at December 31, 2018 | 306 | 306 |
Preferred stock, par value $0.01; 50,000,000 shares authorized and 0 shares issued and outstanding at September 30, 2019 and December 31, 2018 | 0 | 0 |
Treasury stock at par (3,119,546 shares at September 30, 2019; 1,210,714 shares at December 31, 2018) | (31) | (12) |
Additional paid-in capital | 189,242 | 234,699 |
Retained earnings | 231,260 | 187,819 |
Accumulated other comprehensive loss | (3,551) | (2,474) |
Total stockholders' equity | 417,226 | 420,338 |
Total liabilities and stockholders' equity | $ 1,211,817 | $ 1,034,626 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Common stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 30,600,708 | 30,555,715 |
Common stock, shares outstanding (in shares) | 27,481,162 | 29,345,001 |
Preferred stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Treasury stock (in shares) | 3,119,546 | 1,210,714 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 43,441 | $ 45,483 |
Adjustments to reconcile net income to net cash (used for) provided by operating activities: | ||
Depreciation and amortization | 42,094 | 38,905 |
Loss on disposal of assets | 4,967 | 1,560 |
Deferred income taxes | 9,149 | 8,816 |
Stock based compensation | 7,575 | 7,506 |
Accretion of deferred financing fees | 320 | 1,696 |
Restructuring charges | 12,623 | 0 |
Changes in assets and liabilities: | ||
Accounts and other receivables | 51,136 | 46,878 |
Inventories | (26,739) | 14,182 |
Accounts payable | (12,844) | (10,675) |
Accrued liabilities | (4,470) | (9,703) |
Deferred income and customer advances | (20,608) | (14,899) |
Other assets and liabilities | (6,108) | (2,014) |
Net cash provided by operating activities | 100,536 | 127,735 |
Cash flows from investing activities: | ||
Expenditures for property, plant and equipment | (106,386) | (72,650) |
Other investing activities | (2,203) | (1,656) |
Net cash used for investing activities | (108,589) | (74,306) |
Cash flows from financing activities: | ||
Payments of long-term debt | 0 | (266,625) |
Borrowings from line of credit | 316,750 | 284,500 |
Payments of line of credit | (250,750) | (84,500) |
Payment of line of credit facility fees | 0 | (1,362) |
Principal payments of finance leases | (4,656) | (225) |
Purchase of treasury stock | (53,067) | (20,443) |
Issuance of common stock | 16 | 0 |
Net cash provided by (used for) financing activities | 8,293 | (88,655) |
Net change in cash and cash equivalents | 240 | (35,226) |
Cash and cash equivalents at beginning of period | 9,808 | 55,432 |
Cash and cash equivalents at the end of period | 10,048 | 20,206 |
Supplemental non-cash investing activities: | ||
Capital expenditures included in accounts payable | 27,344 | 17,649 |
Supplemental cash activities: | ||
Cash paid for interest | 3,519 | 4,406 |
Cash paid for income taxes | $ 6,949 | $ 7,254 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Retained Earnings (Accumulated Deficit) | Treasury Stock | Accumulated Other Comprehensive Income (Loss) |
Beginning balance (in shares) at Dec. 31, 2017 | 30,482,966 | |||||
Beginning balance at Dec. 31, 2017 | $ 376,325 | $ 305 | $ 263,081 | $ 121,985 | $ 0 | $ (9,046) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 11,593 | 11,593 | ||||
Comprehensive income | ||||||
Foreign exchange translation adjustments | (1) | (1) | ||||
Cash-flow Hedges | 0 | |||||
Pension obligation adjustments | 0 | (410) | 410 | |||
Other comprehensive income (loss), net of tax | (1) | (410) | 409 | |||
Issuance of common stock (in shares) | 25,356 | |||||
Issuance of common stock | 0 | |||||
Purchase of treasury shares | (370) | (370) | ||||
Stock-based compensation | 2,281 | 2,281 | ||||
Ending balance (in shares) at Mar. 31, 2018 | 30,508,322 | |||||
Ending balance at Mar. 31, 2018 | 389,828 | $ 305 | 264,992 | 133,168 | 0 | (8,637) |
Beginning balance (in shares) at Dec. 31, 2017 | 30,482,966 | |||||
Beginning balance at Dec. 31, 2017 | 376,325 | $ 305 | 263,081 | 121,985 | 0 | (9,046) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 45,483 | |||||
Comprehensive income | ||||||
Cash-flow Hedges | 0 | |||||
Ending balance (in shares) at Sep. 30, 2018 | 30,555,715 | |||||
Ending balance at Sep. 30, 2018 | 408,845 | $ 306 | 250,149 | 167,058 | (6) | (8,662) |
Beginning balance (in shares) at Mar. 31, 2018 | 30,508,322 | |||||
Beginning balance at Mar. 31, 2018 | 389,828 | $ 305 | 264,992 | 133,168 | 0 | (8,637) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 28,410 | 28,410 | ||||
Comprehensive income | ||||||
Foreign exchange translation adjustments | (17) | (17) | ||||
Cash-flow Hedges | 0 | |||||
Pension obligation adjustments | 0 | |||||
Other comprehensive income (loss), net of tax | (17) | (17) | ||||
Issuance of common stock (in shares) | 16,416 | |||||
Issuance of common stock | 0 | |||||
Purchase of treasury shares | (2,743) | (2,742) | (1) | |||
Stock-based compensation | 2,599 | 2,599 | ||||
Ending balance (in shares) at Jun. 30, 2018 | 30,524,738 | |||||
Ending balance at Jun. 30, 2018 | 418,077 | $ 305 | 264,849 | 161,578 | (1) | (8,654) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 5,480 | 5,480 | ||||
Comprehensive income | ||||||
Foreign exchange translation adjustments | (8) | (8) | ||||
Cash-flow Hedges | 0 | |||||
Pension obligation adjustments | 0 | |||||
Other comprehensive income (loss), net of tax | (8) | (8) | ||||
Issuance of common stock (in shares) | 30,977 | |||||
Issuance of common stock | 1 | $ 1 | ||||
Purchase of treasury shares | (17,331) | (17,326) | (5) | |||
Stock-based compensation | 2,626 | 2,626 | ||||
Ending balance (in shares) at Sep. 30, 2018 | 30,555,715 | |||||
Ending balance at Sep. 30, 2018 | $ 408,845 | $ 306 | 250,149 | 167,058 | (6) | (8,662) |
Beginning balance (in shares) at Dec. 31, 2018 | 29,345,001 | 30,555,715 | ||||
Beginning balance at Dec. 31, 2018 | $ 420,338 | $ 306 | 234,699 | 187,819 | (12) | (2,474) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 20,174 | 20,174 | ||||
Comprehensive income | ||||||
Foreign exchange translation adjustments | (1) | (1) | ||||
Cash-flow Hedges | (192) | (192) | ||||
Pension obligation adjustments | 0 | |||||
Other comprehensive income (loss), net of tax | (193) | (193) | ||||
Issuance of common stock (in shares) | 22,497 | |||||
Issuance of common stock | 16 | 16 | ||||
Purchase of treasury shares | (23,853) | (23,845) | (8) | |||
Stock-based compensation | 2,762 | 2,762 | ||||
Ending balance (in shares) at Mar. 31, 2019 | 30,578,212 | |||||
Ending balance at Mar. 31, 2019 | $ 419,244 | $ 306 | 213,632 | 207,993 | (20) | (2,667) |
Beginning balance (in shares) at Dec. 31, 2018 | 29,345,001 | 30,555,715 | ||||
Beginning balance at Dec. 31, 2018 | $ 420,338 | $ 306 | 234,699 | 187,819 | (12) | (2,474) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 43,441 | |||||
Comprehensive income | ||||||
Cash-flow Hedges | $ (1,060) | |||||
Ending balance (in shares) at Sep. 30, 2019 | 27,481,162 | 30,600,708 | ||||
Ending balance at Sep. 30, 2019 | $ 417,226 | $ 306 | 189,242 | 231,260 | (31) | (3,551) |
Beginning balance (in shares) at Mar. 31, 2019 | 30,578,212 | |||||
Beginning balance at Mar. 31, 2019 | 419,244 | $ 306 | 213,632 | 207,993 | (20) | (2,667) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 15,346 | 15,346 | ||||
Comprehensive income | ||||||
Foreign exchange translation adjustments | 4 | 4 | ||||
Cash-flow Hedges | (429) | (429) | ||||
Pension obligation adjustments | 0 | |||||
Other comprehensive income (loss), net of tax | (425) | (425) | ||||
Issuance of common stock (in shares) | 13,260 | |||||
Issuance of common stock | 0 | |||||
Purchase of treasury shares | (16,414) | (16,408) | (6) | |||
Stock-based compensation | 2,812 | 2,812 | ||||
Ending balance (in shares) at Jun. 30, 2019 | 30,591,472 | |||||
Ending balance at Jun. 30, 2019 | 420,563 | $ 306 | 200,036 | 223,339 | (26) | (3,092) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 7,921 | 7,921 | ||||
Comprehensive income | ||||||
Foreign exchange translation adjustments | (20) | (20) | ||||
Cash-flow Hedges | (439) | (439) | ||||
Pension obligation adjustments | 0 | |||||
Other comprehensive income (loss), net of tax | (459) | (459) | ||||
Issuance of common stock (in shares) | 9,236 | |||||
Issuance of common stock | 0 | |||||
Purchase of treasury shares | (12,800) | (12,795) | (5) | |||
Stock-based compensation | $ 2,001 | 2,001 | ||||
Ending balance (in shares) at Sep. 30, 2019 | 27,481,162 | 30,600,708 | ||||
Ending balance at Sep. 30, 2019 | $ 417,226 | $ 306 | $ 189,242 | $ 231,260 | $ (31) | $ (3,551) |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - shares | 3 Months Ended | |||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | |
Treasury Stock | ||||||
Stock repurchased during period (in shares) | 537,033 | 578,045 | 793,754 | 485,145 | 70,107 | 8,995 |
Organization, Operations and Ba
Organization, Operations and Basis of Presentation | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Organization, Operations and Basis of Presentation | Organization, Operations and Basis of Presentation Description of Business AdvanSix Inc. (“AdvanSix”, the “Company”, "we" or "our") is an integrated manufacturer of Nylon 6, a polymer resin which is a synthetic material used by our customers to produce engineered plastics, fibers, filaments and films that, in turn, are used in such end-products as automotive and electronic components, carpets, sports apparel, fishing nets and food and industrial packaging. As a result of our backward integration and the configuration of our manufacturing facilities, we also sell a variety of other products, all of which are produced as part of our integrated Nylon 6 resin manufacturing process including caprolactam, ammonium sulfate fertilizers, acetone and other chemical intermediates. Basis of Presentation The Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the Company's financial position as of September 30, 2019, and its results of operations for the three and nine months ended September 30, 2019 and 2018 and cash flows for the nine months ended September 30, 2019 and 2018. The Condensed Consolidated Balance Sheet at December 31, 2018 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. The results of operations of any interim period are not necessarily indicative of the results of operations to be expected for the full fiscal year. These financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 (the "2018 Form 10-K"). All intercompany transactions have been eliminated. Certain prior period amounts have been reclassified for consistency with the current period presentation. It is our practice to establish actual quarterly closing dates using a predetermined fiscal calendar, which requires our businesses to close their books on a Saturday in order to minimize the potentially disruptive effects of quarterly closing on our business processes. Historically, the effects of this practice were generally not significant to reported results for any quarter and only existed within a reporting year. In the event that differences in actual closing dates are material to year-over-year comparisons of quarterly or year-to-date results, we will provide the appropriate disclosures. Our actual closing dates for the three and nine months ended September 30, 2019 and 2018 wer e September 28, 2019 and September 29, 2018, respe ctively. Liabilities to creditors to whom we have issued checks that remained outstanding at September 30, 2019 and December 31, 2018 aggregated $5.4 million and $7.7 million, respectively, and were included in Cash and cash equivalents and Accounts payable in the Condensed Consolidated Balance Sheets. The Company submitted a business interruption insurance claim related to the first quarter 2018 weather event and recorded a benefit of $6.6 million and $2.3 million to Cost of goods sold in the first and second quarters of 2019, respectively. The business interruption claim was closed during the second quarter of 2019 with a total recorded benefit of approximately of $12 million. On May 4, 2018, the Company announced that its Board of Directors (the “Board”) authorized a share repurchase program of up to $75 million of the Company’s common stock. On February 22, 2019, the Company announced that the Board authorized a share repurchase program of up to an additional $75 million of the Company's common stock , which was in addition to the remaining capacity available under the May 2018 share repurchase program. Repurchases may be made from time to time on the open market, including through the use of trading plans intended to qualify under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The size and timing of these repurchases will depend on pricing, market and economic conditions, legal and contractual requirements and other factors. The share repurchase program has no expiration date and may be modified, suspended or discontinued at any time. The par value of the shares repurchased is applied to Treasury stock and the excess of the purchase price over par value is applied to Additional paid-in capital. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Company considers the applicability and impact of all Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). ASUs not discussed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position or results of operations. In October 2018, the FASB issued ASU No. 2018-16, Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (“SOFR”) Overnight Index Swap (“OIS”) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes, which permits use of the OIS rate based on SOFR as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815 in addition to the interest rates on direct Treasury obligations of the U.S. government (“UST”), the LIBOR swap rate, the OIS rate based on the Fed Funds Effective Rate and the SIFMA Municipal Swap Rate. Pursuant to the amendments, SOFR will be an option to replace LIBOR as it is phased out. The amendments of ASU No. 2018-16 are effective for companies that have adopted ASU 2017-12 for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year or at such time a company adopts ASU 2017-12. Early adoption of ASU 2018-16 is not permitted without previous adoption of ASU 2017-12. As the Company elected to early adopt ASU 2017-12 during the fourth quarter of 2018, the Company adopted ASU 2018-16 effective January 1, 2019, which did not have a material impact on the Company's consolidated financial position or results of operations upon adoption. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize most leases on their balance sheets related to the rights and obligations created by those leases. The new standard also requires disclosures to help financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases and will be effective for interim and annual periods beginning after December 15, 2018 (early adoption is permitted). Initial guidance stated that the new standard be applied under a modified retrospective approach with periods prior to the adoption date being adjusted. During July 2018, however, the FASB issued ASU 2018-11, Leases (Topic 842), providing another transition method allowing a company to recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption without adjusting prior periods. The Company adopted the standard effective January 1, 2019 electing the cumulative-effect adjustment approach made available in ASU 2018-11. The Company has also elected the following practical expedients: • the package of three expedients which allows the Company not to re-assess (i) whether any expired or existing contracts are or contain leases, (ii) lease classification for any expired or existing leases, and (iii) initial direct costs for any expired or existing leases; • the short-term lease practical expedient, which allows the Company to exclude leases with an initial term of 12 months or less (“short-term leases”) from recognition in the unaudited Condensed Consolidated Balance Sheet; • the bifurcation of lease and non-lease components practical expedients, which did not require the Company to bifurcate lease and non-lease components for our real estate leases; and • the land easements practical expedient, which allows the Company to carry forward the accounting treatment for land easements on existing agreements. We have implemented internal controls and key system functionality to enable the preparation of financial information on adoption. The standard had a material impact to our Condensed Consolidated Balance Sheet but did not have a significant impact in the recognition, measurement or presentation of lease expenses within the Condensed Consolidated Statements of Operations or the Condensed Consolidated Statements of Cash Flows. The most significant impact was the recognition of right-of-use (“ROU”) assets and liabilities for operating leases, while our accounting for finance leases remained substantially unchanged. See "Note 8. Leases" for further information. |
Revenues
Revenues | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues Revenue Recognition We serve approximately 400 customers annually in more than 40 countries and across a wide variety of industries. For the three months ended September 30, 2019 and 2018, the Company's ten largest customers accounted for approximately 51% and 48% of total sales, respectively. For the nine months ended September 30, 2019 and 2018, the Company's ten largest customers accounted for approximately 47% and 45% of total sales, respectively. We typically sell to customers under master service agreements, with one- to two-year terms on average, or by purchase orders. We have historically experienced low customer turnover and have an average customer relationship of approximately 20 years. Our largest customer is Shaw Industries Group Inc. (“Shaw”), one of the world's largest consumers of caprolactam and Nylon 6 resin. We sell Nylon 6 resin and caprolactam to Shaw under a long-term agreement. For the three months ended September 30, 2019 and 2018, our sales to Shaw were 23% and 22%, respectively, of our total sales. For the nine months ended September 30, 2019 and 2018, our sales to Shaw were 21% and 22%, respectively, of our total sales. Each of the Company’s product lines represented the following approximate percentage of total sales for the three and nine months ended September 30, 2019 and 2018: Three Months Ended Nine Months Ended 2019 2018 2019 2018 Nylon 25% 28% 28% 28% Caprolactam 26% 18% 22% 18% Ammonium Sulfate Fertilizers 20% 19% 23% 20% Chemical Intermediates 29% 35% 27% 34% 100% 100% 100% 100% The Company's revenues by geographic area for the three and nine months ended September 30, 2019 and 2018 were as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 United States $ 250,056 $ 306,050 $ 797,249 $ 946,195 International 60,577 62,603 173,494 182,155 Total $ 310,633 $ 368,653 $ 970,743 $ 1,128,350 Deferred Income and Customer Advances The Company defers revenues when cash payments are received in advance of our performance. Customer advances relate primarily to sales from the ammonium sulfate business. Below is a roll-forward of Deferred income and customer advances for the nine months ended September 30, 2019: Opening balance January 1, 2019 $ 22,556 Additions to deferred revenues 1,083 Less amounts recognized in revenues (21,691) Ending balance September 30, 2019 $ 1,948 The Company expects to recognize as revenue the September 30, 2019 ending balance of Deferred income and customer advances within one year or less. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The computation of basic and diluted earnings per share ("EPS") is based on Net income divided by the basic weighted average number of common shares and diluted weighted average number of common shares, respectively. The details of the basic and diluted EPS calculations for the three and nine months ended September 30, 2019 and 2018 were a s follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 Basic Net Income $ 7,921 $ 5,480 $ 43,441 $ 45,483 Weighted average common shares outstanding 27,608,985 30,160,991 28,192,760 30,375,873 EPS – Basic $ 0.29 $ 0.18 $ 1.54 $ 1.50 Diluted Dilutive effect of equity awards and other stock-based holdings 972,466 822,843 971,264 813,767 Weighted average common shares outstanding 28,581,451 30,983,834 29,164,024 31,189,640 EPS – Diluted $ 0.28 $ 0.18 $ 1.49 $ 1.46 Diluted EPS is computed based upon the weighted average number of common shares outstanding for the period plus the dilutive effect of common stock equivalents (which includes units allocated to the AdvanSix stock unit fund under the AdvanSix Inc. Deferred Compensation Plan) using the treasury stock method and the average market price of our common stock for the year. The diluted EPS calculations exclude the effect of stock options when the options’ assumed proceeds exceed the average market price of the common shares during the period. The anti-dilutive common stock equivalents outstanding at the three and nine months ended September 30, 2019 and 2018 were as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 Options and stock equivalents 658,327 135,535 509,401 130,535 |
Accounts and Other Receivables
Accounts and Other Receivables - Net | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Accounts and Other Receivables - Net | Accounts and Other Receivables – Net September 30, December 31, Accounts receivables $ 108,832 $ 166,017 Other 2,320 1,716 Total accounts and other receivables 111,152 167,733 Less – allowance for doubtful accounts (1,860) (7,467) Total accounts and other receivables – net $ 109,292 $ 160,266 The decrease in Total accounts and other receivables – net at September 30, 2019 versus December 31, 2018 was due primarily to lower sales and increased collections related to a trade receivables discount arrangement with a third-party financial institution. The change in the allowance for doubtful accounts relates primarily to an accounts receivable write-off of approximately $5.1 million related to a customer bankruptcy as previously reported in the 2018 Form 10-K. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories September 30, December 31, Raw materials $ 46,714 $ 55,002 Work in progress 65,146 46,728 Finished goods 57,558 39,368 Spares and other 24,618 24,555 194,036 165,653 Reduction to LIFO cost basis (31,557) (28,471) Total inventories – net $ 162,479 $ 137,182 The increase in Total inventories – net at September 30, 2019 compared to the balance at December 31, 2018 was due primarily to increased Work in progress and Finished goods inventory due to sales timing, product mix and buffer inventory build ahead of the Company's planned fourth quarter 2019 turnaround partially offset by lower levels of Raw materials driven by the timing of cumene deliveries. |
Postretirement Benefit Cost
Postretirement Benefit Cost | 9 Months Ended |
Sep. 30, 2019 | |
Retirement Benefits [Abstract] | |
Postretirement Benefit Cost | Postretirement Benefit Cost The components of Net periodic benefit cost of the Company’s pension plan are as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 Service cost $ 1,714 $ 2,001 $ 5,141 $ 6,004 Interest cost 521 469 1,563 1,407 Expected return on plan assets (334) (287) (1,002) (862) Net periodic benefit cost $ 1,901 $ 2,183 $ 5,702 $ 6,549 The Company made contributions to the defined benefit pension plan of $4.2 million during the nine months ended September 30, 2019 sufficient to satisfy pension funding requirements for 2019 under the AdvanSix Retirement Earnings Plan. The Company made contributions of $0 in the first quarter of 2019, $0.5 million in the second quarter of 2019 and $3.7 million in the third quarter of 2019. The Company does not plan to make additional pension plan contributions during the fourth quarter of 2019, but plans to make additional contributions in future years sufficient to satisfy pension funding requirements in those periods. The pension plan assets are invested through a master trust fund. The strategic asset allocation for the trust fund is selected by the Company's Investment Committee reflecting the results of comprehensive asset and liability modeling. The Investment Committee establishes strategic asset allocation percentage targets and appropriate benchmarks for significant asset classes with the aim of achieving a prudent balance between return and risk. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | Leases We determine if an arrangement is a lease at inception. Operating leases are included in Operating lease right-of-use assets, Operating lease liabilities – short-term, and Operating lease liabilities – long-term in our Condensed Consolidated Balance Sheets. Finance leases are included in Property, plant and equipment – net, Accounts payable, and Other liabilities in our Condensed Consolidated Balance Sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. The operating lease ROU asset also includes any lease pre-payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease and, when it is reasonably certain that such an option will be exercised, it is included in the determination of the corresponding assets and liabilities. Short-term leases are not recognized on our unaudited Condensed Consolidated Balance Sheets. Lease expense for all lease payments is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are generally accounted for separately. Additionally, for certain equipment leases, we apply a portfolio approach to effectively account for the operating lease ROU assets and liabilities. The Company has entered into agreements to lease transportation equipment, storage facilities, office space, dock access and other equipment. The leases have initial terms of up to 20 years with some containing renewal options subject to customary conditions. The components of lease expense were as follows: Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019 Finance lease cost: Amortization of right-of-use asset $ 172 $ 477 Interest on lease liabilities 18 52 Total finance lease cost 190 529 Operating lease cost 9,874 25,375 Short-term lease cost 2,527 10,924 Total lease cost $ 12,591 $ 36,828 Supplemental cash flow information related to leases was as follows: Nine Months Ended September 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 25,089 Operating cash flows from finance leases 48 Financing cash flows from finance leases 4,656 Non-cash information: Right-of-use assets obtained in exchange for lease obligations: Operating leases 38,324 Finance leases 872 Supplemental balance sheet information related to leases was as follows: September 30, Operating Leases Operating lease right-of-use assets $ 136,122 Operating lease liabilities – short term 35,656 Operating lease liabilities – long term 100,752 Total operating lease liabilities $ 136,408 Finance Leases Property, plant and equipment – gross $ 2,633 Accumulated depreciation (1,206) Property, plant and equipment – net $ 1,427 Accounts payable 676 Other liabilities 768 Total finance lease liabilities $ 1,444 Weighted Average Remaining Lease Term Operating leases 9.2 years Finance leases 2.3 years Weighted Average Discount Rate Operating leases 5.75 % Finance leases 4.87 % The cumulative effect of the changes made to the Condensed Consolidated Balance Sheets for the adoption of the new leasing standard on January 1, 2019 was as follows: Balance Sheet accounts prior to new leasing standard adoption adjustments Adjustments due to the adoption of the new leasing standard Balance Sheet accounts after the new leasing standard adoption adjustments ASSETS Property, plant and equipment – net $ 1,032 $ — $ 1,032 Operating lease right-of-use assets — 117,921 117,921 Total assets 1,034,626 $ 117,921 1,152,547 LIABILITIES AND EQUITY Current Liabilities: Accounts payable $ 318 $ — $ 318 Operating lease liabilities – short term — 24,794 24,794 Total current liabilities 284,724 24,794 309,518 Operating lease liabilities – long term — 93,127 93,127 Other liabilities 762 — 762 Total liabilities 614,288 117,921 732,209 Total equity 420,338 — 420,338 Total liabilities and equity 1,034,626 $ 117,921 1,152,547 Maturities of lease liabilities were as follows: Year Ending December 31, Operating Leases Finance Leases 2019 (remainder) $ 10,987 $ 194 2020 41,576 708 2021 29,838 472 2022 20,578 151 2023 12,391 — Thereafter 70,375 — Total lease payments 185,745 1,525 Less imputed interest (49,337) (81) Total $ 136,408 $ 1,444 As previously disclosed in our 2018 Form 10-K and under the previous lease accounting standard, future minimum lease payments for leases having initial or remaining non-cancellable lease terms in excess of one year were as follows: Year Ending December 31, Operating Leases Capital Leases 2019 $ 36,110 $ 239 2020 29,318 212 2021 16,111 131 2022 11,571 89 2023 9,104 — Thereafter 26,627 — Total lease payments $ 128,841 $ 671 |
Leases | Leases We determine if an arrangement is a lease at inception. Operating leases are included in Operating lease right-of-use assets, Operating lease liabilities – short-term, and Operating lease liabilities – long-term in our Condensed Consolidated Balance Sheets. Finance leases are included in Property, plant and equipment – net, Accounts payable, and Other liabilities in our Condensed Consolidated Balance Sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. The operating lease ROU asset also includes any lease pre-payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease and, when it is reasonably certain that such an option will be exercised, it is included in the determination of the corresponding assets and liabilities. Short-term leases are not recognized on our unaudited Condensed Consolidated Balance Sheets. Lease expense for all lease payments is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are generally accounted for separately. Additionally, for certain equipment leases, we apply a portfolio approach to effectively account for the operating lease ROU assets and liabilities. The Company has entered into agreements to lease transportation equipment, storage facilities, office space, dock access and other equipment. The leases have initial terms of up to 20 years with some containing renewal options subject to customary conditions. The components of lease expense were as follows: Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019 Finance lease cost: Amortization of right-of-use asset $ 172 $ 477 Interest on lease liabilities 18 52 Total finance lease cost 190 529 Operating lease cost 9,874 25,375 Short-term lease cost 2,527 10,924 Total lease cost $ 12,591 $ 36,828 Supplemental cash flow information related to leases was as follows: Nine Months Ended September 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 25,089 Operating cash flows from finance leases 48 Financing cash flows from finance leases 4,656 Non-cash information: Right-of-use assets obtained in exchange for lease obligations: Operating leases 38,324 Finance leases 872 Supplemental balance sheet information related to leases was as follows: September 30, Operating Leases Operating lease right-of-use assets $ 136,122 Operating lease liabilities – short term 35,656 Operating lease liabilities – long term 100,752 Total operating lease liabilities $ 136,408 Finance Leases Property, plant and equipment – gross $ 2,633 Accumulated depreciation (1,206) Property, plant and equipment – net $ 1,427 Accounts payable 676 Other liabilities 768 Total finance lease liabilities $ 1,444 Weighted Average Remaining Lease Term Operating leases 9.2 years Finance leases 2.3 years Weighted Average Discount Rate Operating leases 5.75 % Finance leases 4.87 % The cumulative effect of the changes made to the Condensed Consolidated Balance Sheets for the adoption of the new leasing standard on January 1, 2019 was as follows: Balance Sheet accounts prior to new leasing standard adoption adjustments Adjustments due to the adoption of the new leasing standard Balance Sheet accounts after the new leasing standard adoption adjustments ASSETS Property, plant and equipment – net $ 1,032 $ — $ 1,032 Operating lease right-of-use assets — 117,921 117,921 Total assets 1,034,626 $ 117,921 1,152,547 LIABILITIES AND EQUITY Current Liabilities: Accounts payable $ 318 $ — $ 318 Operating lease liabilities – short term — 24,794 24,794 Total current liabilities 284,724 24,794 309,518 Operating lease liabilities – long term — 93,127 93,127 Other liabilities 762 — 762 Total liabilities 614,288 117,921 732,209 Total equity 420,338 — 420,338 Total liabilities and equity 1,034,626 $ 117,921 1,152,547 Maturities of lease liabilities were as follows: Year Ending December 31, Operating Leases Finance Leases 2019 (remainder) $ 10,987 $ 194 2020 41,576 708 2021 29,838 472 2022 20,578 151 2023 12,391 — Thereafter 70,375 — Total lease payments 185,745 1,525 Less imputed interest (49,337) (81) Total $ 136,408 $ 1,444 As previously disclosed in our 2018 Form 10-K and under the previous lease accounting standard, future minimum lease payments for leases having initial or remaining non-cancellable lease terms in excess of one year were as follows: Year Ending December 31, Operating Leases Capital Leases 2019 $ 36,110 $ 239 2020 29,318 212 2021 16,111 131 2022 11,571 89 2023 9,104 — Thereafter 26,627 — Total lease payments $ 128,841 $ 671 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is subject to a number of lawsuits, investigations and disputes, some of which involve substantial amounts claimed, arising out of the conduct of the Company or other third-parties in the normal and ordinary course of business. A liability is recognized for any contingency that is probable of occurrence and reasonably estimable. The Company continually assesses the likelihood of adverse judgments or outcomes in these matters, as well as potential ranges of possible losses (taking into consideration any insurance recoveries), based on an analysis of each matter with the assistance of legal counsel and, if applicable, other experts. Given the uncertainty inherent in such lawsuits, investigations and disputes, the Company does not believe it is possible to develop estimates of reasonably possible loss in excess of current accruals for these matters. Considering the Company’s past experience and existing accruals, the Company does not expect the outcome of these matters, either individually or in the aggregate, to have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows. Potential liabilities are subject to change due to new developments, changes in settlement strategy or the impact of evidentiary requirements, which could cause the Company to pay damage awards or settlements (or become subject to equitable remedies) that could have a material adverse effect on the Company’s consolidated results of operations, balance sheet and/or operating cash flows in the periods recognized or paid. We assumed from Honeywell all health, safety and environmental (“HSE”) liabilities and compliance obligations related to the past and future operations of our current business, as well as all HSE liabilities associated with our three current manufacturing locations and the other locations used in our current operations, including any cleanup or other liabilities related to any contamination that may have occurred at such locations in the past. Honeywell retained all HSE liabilities related to former business locations or the operation of our former businesses. Although we have ongoing environmental remedial obligations at certain of our facilities, in the past three years, the associated remediation costs have not been material, and we do not expect our known remediation costs to be material for 2019. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s provision for income taxes in interim periods is computed by applying an estimated annual effective tax rate against Income before taxes for the period in addition to recording any tax effects of discrete items for the quarter. The provision for income taxes was $1.5 million and $0.2 million for the three months ended September 30, 2019 and 2018, respectively. The provision for income taxes was $13.6 million and $13.4 million for the nine months ended September 30, 2019 and 2018, respectively. In the current period, the Company recorded an income tax benefit of $0.9 million in connection with the filing of the 2018 U.S. federal income tax return primarily attributable to additional research tax credits claimed in 2018. This resulted in a 9.9% and 1.6% decrease to the Company’s effective tax rate for the three and nine months ended September 30, 2019, respectively. In the period ended September 30, 2018, the Company recorded a net $1.0 million income tax benefit in connection with the filing of the 2017 U.S. federal income tax return and the accounting under ASC 740 (Staff Accounting Bulletin No. 118) for the Tax Cuts and Jobs Act ("Tax Act") . These adjustments resulted in a 18.2% and 1.8% decrease to the Company’s effective tax rate for the three and nine months ended September 30, 2018, respectively. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Financial and non-financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. During the fourth quarter of 2018, the Company acquired a royalty stream which has been treated as an asset acquisition. The purchase price of the royalty stream for $1.0 million approximated its fair value at December 31, 2018 and is considered a Level 3 asset. The fair value measurement is based on the expected future cash flows and, as there is no reason to believe that the asset is impaired, it is assumed that the valuation remains unchanged at September 30, 2019. In November 2018 and July 2019, the Company entered into two interest rate swap transactions related to its credit agreement. The fair value of the interest rate swaps at September 30, 2019 was a loss of approximately $2.2 million and is considered a Level 2 liability. The pension plan assets are invested in collective investment trust funds. These investments are measured at fair value using the net asset value per share as a practical expedient. Investments valued using the net asset value method (NAV) (or its equivalent) practical expedient are excluded from the fair value hierarchy disclosure. The Company’s Condensed Consolidated Balance Sheets also include Cash and cash equivalents, Accounts receivable and Accounts payable all of which are recorded at amounts which approximate fair value. The Company also has assets that are required to be recorded at fair value on a non-recurring basis. These assets are evaluated when certain triggering events occur (including a decrease in estimated future cash flows) that indicate the asset should be evaluated for impairment. Goodwill and indefinite lived intangible assets must be evaluated at least annually. |
Derivative and Hedging Instrume
Derivative and Hedging Instruments | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative and Hedging Instruments | Derivative and Hedging Instruments The specific credit and market, commodity price and interest rate risks to which the Company is exposed in connection with its ongoing business operations are described below. This discussion includes an explanation of the hedging instrument, interest rate swap agreements, used to manage the Company’s interest rate risk associated with a fixed and floating-rate borrowing. For cash flow hedges, the entire change in the fair value of the hedging instrument included in the assessment of hedge effectiveness is recorded in Other comprehensive income. Those amounts are reclassified to earnings in the same income statement line item that is used to present the earnings effect of the hedged item when the hedged item affects earnings. Credit and Market Risk – Financial instruments, including derivatives, expose the Company to counterparty credit risk for non-performance and to market risk related to changes in commodity prices, interest rates and foreign currency exchange rates. The Company manages its exposure to counterparty credit risk through specific minimum credit standards, diversification of counterparties, and procedures to monitor concentrations of credit risk. The Company’s counterparties in derivative transactions are substantial investment and commercial banks with significant experience using such derivative instruments. The Company monitors the impact of market risk on the fair value and cash flows of its derivative and other financial instruments considering reasonably possible changes in commodity prices, interest rates and foreign currency exchange rates and restricts the use of derivative financial instruments to hedging activities. The Company continually monitors the creditworthiness of its customers to which it grants credit terms in the normal course of business. The terms and conditions of credit sales are designed to mitigate or eliminate concentrations of credit risk with any single customer. Although the Company did not have any customers accounting for a significant percentage of trade Accounts receivable - net at September 30, 2019, one customer accounted for approximately 22% of trade Accounts receivable – net at December 31, 2018. Commodity Price Risk Management – The Company's exposure to market risk for commodity prices can result in changes in the cost of production. We primarily mitigate our exposure to commodity price risk by using long-term, formula-based price contracts with our suppliers and formula-based price agreements with customers. Our customer agreements provide for price adjustments based on relevant market indices and raw material prices and generally do not include take-or-pay terms. We may also enter into forward commodity contracts with third-parties designated as hedges of anticipated purchases of several commodities. Forward commodity contracts are marked-to-market, with the resulting gains and losses recognized in earnings, in the same category as the items being hedged, when the hedged transaction is recognized. At September 30, 2019 and 2018, we had no financial contracts related to forward commodity agreements. Interest Rate Risk Management – The Company has entered into two interest rate swap agreements for a total notional amount of $100 million to exchange floating for fixed rate interest payments for our LIBOR-based borrowings. These interest rate swaps had a fair value of zero at inception and were effective November 30, 2018 and July 31, 2019 with respective maturity dates of November 30, 2021 and February 21, 2023. In accordance with FASB Accounting Standards Codification (“ASC”) ASC 815, the Company designated the interest rate swaps as cash flow hedges of floating-rate borrowings. The interest rate swaps convert the Company’s interest rate payments on the first $100 million of variable-rate, 1-month LIBOR-based debt to a fixed interest rate. These interest rate swaps involve the receipt of floating rate amounts in exchange for fixed rate interest payments over the life of the interest rate swap without an exchange of the underlying principal amount. Liability Derivatives September 30, 2019 December 31, 2018 Balance Sheet Classification Fair Value Balance Sheet Classification Fair Value Derivatives designated as hedging instruments under ASC 815: Interest Rate Contracts Accrued liabilities and Other liabilities (2,246) Accrued liabilities and Other liabilities (833) Total Derivatives $ (2,246) $ (833) The following table summarizes adjustments related to cash flow hedge included in Cash-flow hedges, in the Condensed Consolidated Statements of Comprehensive Income: September 30, Loss on derivative instruments included in Accumulated other comprehensive income at December 31, 2018 $ (833) Fair value adjustment (1,413) Loss on derivative instruments included in Accumulated other comprehensive income at September 30, 2019 $ (2,246) At September 30, 2019, the Company expects to reclassify approximately $0.9 million of net losses on derivative instruments from Accumulated other comprehensive income to earnings during the next 12 months due to the payment of variable interest associated with the floating rate debt. |
Restructuring
Restructuring | 9 Months Ended |
Sep. 30, 2019 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring On May 2, 2019, the Company approved the closure of its Pottsville, Pennsylvania films plant as part of its broader strategic efforts to improve the Company’s competitive position in providing quality film products and services to its customers. The Company also announced a strategic alliance with Oben Holding Group S.A. (“Oben”), a third-party producer of films for the flexible packaging industry, leveraging the Company's sales channels and Nylon 6 supply with Oben's new state-of-the-art manufacturing facility. The Company ceased operations at the Pottsville, Pennsylvania plant in July 2019. Restructuring costs consist of long-lived asset impairments, facility exit costs, employee separations and inventory write-downs. Facility exit costs include demolition, equipment relocation, contract terminations and project management costs. These costs are included in Cost of goods sold in the Condensed Consolidated Statements of Operations. The Company recorded a restructuring charge of $12.6 million in the second quarter of 2019 and does not expect to incur any additional restructuring charges related to the closure of its films plant. Restructuring costs for the nine months ended September 30, 2019 were as follows: Nine Months Ended September 30, 2019 Write-off of equipment and facility $ 7,131 Facility exit costs 2,686 Employee separations 1,364 Inventory write-downs 1,442 Total restructuring charges $ 12,623 The following table summarizes the components of restructuring activities and the remaining balances of accrued restructuring charges as of September 30, 2019: Employee Separation Benefits Facility Exit Costs Total Accrual balance at December 31, 2018 $ — $ — $ — Charges 1,364 2,686 4,050 Cash payments (1,364) (103) (1,467) Accrual balance at September 30, 2019 $ — $ 2,583 $ 2,583 The balance of accrued restructuring charges is expected to be settled within the next twelve months. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsPlace-holder. If none exist, this note will be removed. |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the Company's financial position as of September 30, 2019, and its results of operations for the three and nine months ended September 30, 2019 and 2018 and cash flows for the nine months ended September 30, 2019 and 2018. The Condensed Consolidated Balance Sheet at December 31, 2018 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. The results of operations of any interim period are not necessarily indicative of the results of operations to be expected for the full fiscal year. These financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 (the "2018 Form 10-K"). All intercompany transactions have been eliminated. Certain prior period amounts have been reclassified for consistency with the current period presentation. It is our practice to establish actual quarterly closing dates using a predetermined fiscal calendar, which requires our businesses to close their books on a Saturday in order to minimize the potentially disruptive effects of quarterly closing on our business processes. Historically, the effects of this practice were generally not significant to reported results for any quarter and only existed within a reporting year. In the event that differences in actual closing dates are material to year-over-year comparisons of quarterly or year-to-date results, we will provide the appropriate disclosures. Our actual closing dates for the three and nine months ended September 30, 2019 and 2018 wer e September 28, 2019 and September 29, 2018, respe ctively. |
New Accounting Pronouncements | In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize most leases on their balance sheets related to the rights and obligations created by those leases. The new standard also requires disclosures to help financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases and will be effective for interim and annual periods beginning after December 15, 2018 (early adoption is permitted). Initial guidance stated that the new standard be applied under a modified retrospective approach with periods prior to the adoption date being adjusted. During July 2018, however, the FASB issued ASU 2018-11, Leases (Topic 842), providing another transition method allowing a company to recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption without adjusting prior periods. The Company adopted the standard effective January 1, 2019 electing the cumulative-effect adjustment approach made available in ASU 2018-11. The Company has also elected the following practical expedients: • the package of three expedients which allows the Company not to re-assess (i) whether any expired or existing contracts are or contain leases, (ii) lease classification for any expired or existing leases, and (iii) initial direct costs for any expired or existing leases; • the short-term lease practical expedient, which allows the Company to exclude leases with an initial term of 12 months or less (“short-term leases”) from recognition in the unaudited Condensed Consolidated Balance Sheet; • the bifurcation of lease and non-lease components practical expedients, which did not require the Company to bifurcate lease and non-lease components for our real estate leases; and • the land easements practical expedient, which allows the Company to carry forward the accounting treatment for land easements on existing agreements. We have implemented internal controls and key system functionality to enable the preparation of financial information on adoption. The standard had a material impact to our Condensed Consolidated Balance Sheet but did not have a significant impact in the recognition, measurement or presentation of lease expenses within the Condensed Consolidated Statements of Operations or the Condensed Consolidated Statements of Cash Flows. The most significant impact was the recognition of right-of-use (“ROU”) assets and liabilities for operating leases, while our accounting for finance leases remained substantially unchanged. See "Note 8. Leases" for further information. |
Revenues (Tables)
Revenues (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | Each of the Company’s product lines represented the following approximate percentage of total sales for the three and nine months ended September 30, 2019 and 2018: Three Months Ended Nine Months Ended 2019 2018 2019 2018 Nylon 25% 28% 28% 28% Caprolactam 26% 18% 22% 18% Ammonium Sulfate Fertilizers 20% 19% 23% 20% Chemical Intermediates 29% 35% 27% 34% 100% 100% 100% 100% The Company's revenues by geographic area for the three and nine months ended September 30, 2019 and 2018 were as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 United States $ 250,056 $ 306,050 $ 797,249 $ 946,195 International 60,577 62,603 173,494 182,155 Total $ 310,633 $ 368,653 $ 970,743 $ 1,128,350 |
Summary of Deferred Income and Customer Advances | Below is a roll-forward of Deferred income and customer advances for the nine months ended September 30, 2019: Opening balance January 1, 2019 $ 22,556 Additions to deferred revenues 1,083 Less amounts recognized in revenues (21,691) Ending balance September 30, 2019 $ 1,948 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share | The details of the basic and diluted EPS calculations for the three and nine months ended September 30, 2019 and 2018 were a s follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 Basic Net Income $ 7,921 $ 5,480 $ 43,441 $ 45,483 Weighted average common shares outstanding 27,608,985 30,160,991 28,192,760 30,375,873 EPS – Basic $ 0.29 $ 0.18 $ 1.54 $ 1.50 Diluted Dilutive effect of equity awards and other stock-based holdings 972,466 822,843 971,264 813,767 Weighted average common shares outstanding 28,581,451 30,983,834 29,164,024 31,189,640 EPS – Diluted $ 0.28 $ 0.18 $ 1.49 $ 1.46 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The anti-dilutive common stock equivalents outstanding at the three and nine months ended September 30, 2019 and 2018 were as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 Options and stock equivalents 658,327 135,535 509,401 130,535 |
Accounts and Other Receivable_2
Accounts and Other Receivables - Net (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Schedule of Accounts and Other Receivables Net | September 30, December 31, Accounts receivables $ 108,832 $ 166,017 Other 2,320 1,716 Total accounts and other receivables 111,152 167,733 Less – allowance for doubtful accounts (1,860) (7,467) Total accounts and other receivables – net $ 109,292 $ 160,266 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current | September 30, December 31, Raw materials $ 46,714 $ 55,002 Work in progress 65,146 46,728 Finished goods 57,558 39,368 Spares and other 24,618 24,555 194,036 165,653 Reduction to LIFO cost basis (31,557) (28,471) Total inventories – net $ 162,479 $ 137,182 |
Postretirement Benefit Cost (Ta
Postretirement Benefit Cost (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Retirement Benefits [Abstract] | |
Schedule of Net Benefit Costs | The components of Net periodic benefit cost of the Company’s pension plan are as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 Service cost $ 1,714 $ 2,001 $ 5,141 $ 6,004 Interest cost 521 469 1,563 1,407 Expected return on plan assets (334) (287) (1,002) (862) Net periodic benefit cost $ 1,901 $ 2,183 $ 5,702 $ 6,549 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Components of Lease Expense | The components of lease expense were as follows: Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019 Finance lease cost: Amortization of right-of-use asset $ 172 $ 477 Interest on lease liabilities 18 52 Total finance lease cost 190 529 Operating lease cost 9,874 25,375 Short-term lease cost 2,527 10,924 Total lease cost $ 12,591 $ 36,828 Supplemental cash flow information related to leases was as follows: Nine Months Ended September 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 25,089 Operating cash flows from finance leases 48 Financing cash flows from finance leases 4,656 Non-cash information: Right-of-use assets obtained in exchange for lease obligations: Operating leases 38,324 Finance leases 872 |
Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases was as follows: September 30, Operating Leases Operating lease right-of-use assets $ 136,122 Operating lease liabilities – short term 35,656 Operating lease liabilities – long term 100,752 Total operating lease liabilities $ 136,408 Finance Leases Property, plant and equipment – gross $ 2,633 Accumulated depreciation (1,206) Property, plant and equipment – net $ 1,427 Accounts payable 676 Other liabilities 768 Total finance lease liabilities $ 1,444 Weighted Average Remaining Lease Term Operating leases 9.2 years Finance leases 2.3 years Weighted Average Discount Rate Operating leases 5.75 % Finance leases 4.87 % |
Schedule of New Accounting Pronouncements | The cumulative effect of the changes made to the Condensed Consolidated Balance Sheets for the adoption of the new leasing standard on January 1, 2019 was as follows: Balance Sheet accounts prior to new leasing standard adoption adjustments Adjustments due to the adoption of the new leasing standard Balance Sheet accounts after the new leasing standard adoption adjustments ASSETS Property, plant and equipment – net $ 1,032 $ — $ 1,032 Operating lease right-of-use assets — 117,921 117,921 Total assets 1,034,626 $ 117,921 1,152,547 LIABILITIES AND EQUITY Current Liabilities: Accounts payable $ 318 $ — $ 318 Operating lease liabilities – short term — 24,794 24,794 Total current liabilities 284,724 24,794 309,518 Operating lease liabilities – long term — 93,127 93,127 Other liabilities 762 — 762 Total liabilities 614,288 117,921 732,209 Total equity 420,338 — 420,338 Total liabilities and equity 1,034,626 $ 117,921 1,152,547 |
Maturities of Finance Lease Liabilities | Maturities of lease liabilities were as follows: Year Ending December 31, Operating Leases Finance Leases 2019 (remainder) $ 10,987 $ 194 2020 41,576 708 2021 29,838 472 2022 20,578 151 2023 12,391 — Thereafter 70,375 — Total lease payments 185,745 1,525 Less imputed interest (49,337) (81) Total $ 136,408 $ 1,444 |
Maturities of Operating Lease Liabilities | Maturities of lease liabilities were as follows: Year Ending December 31, Operating Leases Finance Leases 2019 (remainder) $ 10,987 $ 194 2020 41,576 708 2021 29,838 472 2022 20,578 151 2023 12,391 — Thereafter 70,375 — Total lease payments 185,745 1,525 Less imputed interest (49,337) (81) Total $ 136,408 $ 1,444 |
Schedule of Future Minimum Rental Payments for Operating Leases | As previously disclosed in our 2018 Form 10-K and under the previous lease accounting standard, future minimum lease payments for leases having initial or remaining non-cancellable lease terms in excess of one year were as follows: Year Ending December 31, Operating Leases Capital Leases 2019 $ 36,110 $ 239 2020 29,318 212 2021 16,111 131 2022 11,571 89 2023 9,104 — Thereafter 26,627 — Total lease payments $ 128,841 $ 671 |
Schedule of Future Minimum Lease Payments for Capital Leases | As previously disclosed in our 2018 Form 10-K and under the previous lease accounting standard, future minimum lease payments for leases having initial or remaining non-cancellable lease terms in excess of one year were as follows: Year Ending December 31, Operating Leases Capital Leases 2019 $ 36,110 $ 239 2020 29,318 212 2021 16,111 131 2022 11,571 89 2023 9,104 — Thereafter 26,627 — Total lease payments $ 128,841 $ 671 |
Derivative and Hedging Instru_2
Derivative and Hedging Instruments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | Liability Derivatives September 30, 2019 December 31, 2018 Balance Sheet Classification Fair Value Balance Sheet Classification Fair Value Derivatives designated as hedging instruments under ASC 815: Interest Rate Contracts Accrued liabilities and Other liabilities (2,246) Accrued liabilities and Other liabilities (833) Total Derivatives $ (2,246) $ (833) |
Derivative Instruments, Gain (Loss) | The following table summarizes adjustments related to cash flow hedge included in Cash-flow hedges, in the Condensed Consolidated Statements of Comprehensive Income: September 30, Loss on derivative instruments included in Accumulated other comprehensive income at December 31, 2018 $ (833) Fair value adjustment (1,413) Loss on derivative instruments included in Accumulated other comprehensive income at September 30, 2019 $ (2,246) |
Restructuring (Tables)
Restructuring (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | Restructuring costs for the nine months ended September 30, 2019 were as follows: Nine Months Ended September 30, 2019 Write-off of equipment and facility $ 7,131 Facility exit costs 2,686 Employee separations 1,364 Inventory write-downs 1,442 Total restructuring charges $ 12,623 |
Schedule of Restructuring Reserve by Type of Cost | The following table summarizes the components of restructuring activities and the remaining balances of accrued restructuring charges as of September 30, 2019: Employee Separation Benefits Facility Exit Costs Total Accrual balance at December 31, 2018 $ — $ — $ — Charges 1,364 2,686 4,050 Cash payments (1,364) (103) (1,467) Accrual balance at September 30, 2019 $ — $ 2,583 $ 2,583 The balance of accrued restructuring charges is expected to be settled within the next twelve months. |
Organization, Operations and _2
Organization, Operations and Basis of Presentation (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | 17 Months Ended | |||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2019 | Feb. 22, 2019 | May 04, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Liabilities to creditors, payments issued but outstanding | $ 5,400,000 | $ 7,700,000 | ||||||
Share repurchase program, maximum amount of shares authorized to be repurchased | $ 75,000,000 | $ 75,000,000 | ||||||
Stock repurchased during period (in shares) | 3,089,762 | |||||||
Stock repurchased during period, value | $ 90,400,000 | |||||||
Treasury stock acquired, weighted average cost per share (in dollars per share) | $ 29.26 | |||||||
Stock repurchase program, remaining authorized repurchase amount | $ 59,600,000 | $ 59,600,000 | ||||||
Cost of Sales | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Insurance recoveries | $ 2,300,000 | $ 6,600,000 | $ 12,000,000 |
Revenues - Narrative (Details)
Revenues - Narrative (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019countrycustomer | Sep. 30, 2018 | |
Concentration Risk [Line Items] | ||||
Number of customers | customer | 400 | |||
Number of countries in which customers are located (more than) | country | 40 | |||
Length of contract terms | We typically sell to customers under master service agreements, with one- to two-year terms on average, or by purchase orders. | |||
Duration of customer relationship | 20 years | |||
10 Largest Customers | Customer Concentration Risk | Revenue from Contract with Customer | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 51.00% | 48.00% | 47.00% | 45.00% |
Shaw Industries Group Inc | Customer Concentration Risk | Revenue from Contract with Customer | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 23.00% | 22.00% | 21.00% | 22.00% |
Revenues - Disaggregation of Re
Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 100.00% | 100.00% | 100.00% | 100.00% |
Sales | $ 310,633 | $ 368,653 | $ 970,743 | $ 1,128,350 |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 250,056 | 306,050 | 797,249 | 946,195 |
International | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | $ 60,577 | $ 62,603 | $ 173,494 | $ 182,155 |
Nylon | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 25.00% | 28.00% | 28.00% | 28.00% |
Caprolactam | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 26.00% | 18.00% | 22.00% | 18.00% |
Ammonium Sulfate Fertilizers | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 20.00% | 19.00% | 23.00% | 20.00% |
Chemical Intermediates | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 29.00% | 35.00% | 27.00% | 34.00% |
Revenues - Summary of Deferred
Revenues - Summary of Deferred Revenue and Customer Advances (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Change in Contract with Customer, Liability [Roll Forward] | |
Opening balance | $ 22,556 |
Additions to deferred revenues | 1,083 |
Less amounts recognized in revenues | (21,691) |
Ending balance | $ 1,948 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Basic | ||||||||
Net Income | $ 7,921 | $ 15,346 | $ 20,174 | $ 5,480 | $ 28,410 | $ 11,593 | $ 43,441 | $ 45,483 |
Weighted average common shares outstanding (in shares) | 27,608,985 | 30,160,991 | 28,192,760 | 30,375,873 | ||||
EPS – Basic (in dollars per share) | $ 0.29 | $ 0.18 | $ 1.54 | $ 1.50 | ||||
Diluted | ||||||||
Dilutive effect of equity awards and other stock-based holdings (in shares) | 972,466 | 822,843 | 971,264 | 813,767 | ||||
Weighted average common shares outstanding (in shares) | 28,581,451 | 30,983,834 | 29,164,024 | 31,189,640 | ||||
EPS – Diluted (in dollars per share) | $ 0.28 | $ 0.18 | $ 1.49 | $ 1.46 |
Earnings Per Share - Antidiluti
Earnings Per Share - Antidilutive Common Stock Equivalents (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Options and stock equivalents (in shares) | 658,327 | 135,535 | 509,401 | 130,535 |
Accounts and Other Receivable_3
Accounts and Other Receivables - Net (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Receivables [Abstract] | ||
Accounts receivables | $ 108,832 | $ 166,017 |
Other | 2,320 | 1,716 |
Total accounts and other receivables | 111,152 | 167,733 |
Less – allowance for doubtful accounts | (1,860) | (7,467) |
Total accounts and other receivables – net | 109,292 | $ 160,266 |
Accounts receivable, allowance for doubtful accounts write-off | $ 5,100 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 46,714 | $ 55,002 |
Work in progress | 65,146 | 46,728 |
Finished goods | 57,558 | 39,368 |
Spares and other | 24,618 | 24,555 |
Inventory gross | 194,036 | 165,653 |
Reduction to LIFO cost basis | (31,557) | (28,471) |
Total inventories – net | $ 162,479 | $ 137,182 |
Postretirement Benefit Cost - N
Postretirement Benefit Cost - Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Retirement Benefits [Abstract] | ||||
Service cost | $ 1,714 | $ 2,001 | $ 5,141 | $ 6,004 |
Interest cost | 521 | 469 | 1,563 | 1,407 |
Expected return on plan assets | (334) | (287) | (1,002) | (862) |
Net periodic benefit cost | $ 1,901 | $ 2,183 | $ 5,702 | $ 6,549 |
Postretirement Benefit Cost -_2
Postretirement Benefit Cost - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2019 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||||
Pension contributions | $ 3,700,000 | $ 500,000 | $ 0 | $ 4,200,000 | |
Scenario, Forecast | |||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||||
Pension contributions | $ 0 |
Leases - Narrative (Details)
Leases - Narrative (Details) | Sep. 30, 2019 |
Leases [Abstract] | |
Leases, term of contract | 20 years |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Finance Lease Cost | ||
Amortization of right-of-use asset | $ 172 | $ 477 |
Interest on lease liabilities | 18 | 52 |
Total finance lease cost | 190 | 529 |
Operating lease cost | 9,874 | 25,375 |
Short-term lease cost | 2,527 | 10,924 |
Total lease cost | $ 12,591 | $ 36,828 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows from operating leases | $ 25,089 |
Operating cash flows from finance leases | 48 |
Financing cash flows from finance leases | 4,656 |
Right-of-use assets obtained in exchange for lease obligations: | |
Operating leases | 38,324 |
Finance leases | $ 872 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Operating Leases | |||
Operating lease right-of-use assets | $ 136,122 | $ 117,921 | $ 0 |
Operating lease liabilities – short-term | 35,656 | 24,794 | 0 |
Operating lease liabilities – long-term | 100,752 | 93,127 | $ 0 |
Total operating lease liabilities | 136,408 | ||
Finance Leases | |||
Property, plant and equipment – gross | 2,633 | ||
Accumulated depreciation | (1,206) | ||
Property, plant and equipment – net | 1,427 | $ 1,032 | |
Accounts payable | 676 | ||
Other liabilities | 768 | ||
Total finance lease liabilities | $ 1,444 | ||
Weighted Average Remaining Lease Term | |||
Operating leases | 9 years 2 months 12 days | ||
Finance leases | 2 years 3 months 18 days | ||
Weighted Average Discount Rate | |||
Operating leases | 5.75% | ||
Finance leases | 4.87% |
Leases - Cumulative Effect of A
Leases - Cumulative Effect of Adoption of New Leasing Standard (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
ASSETS | |||
Property, plant and equipment - net | $ 1,032 | ||
Property, plant and equipment – net | $ 1,427 | $ 1,032 | |
Operating lease right-of-use assets | 136,122 | 117,921 | 0 |
Total assets | 1,211,817 | 1,152,547 | 1,034,626 |
Current liabilities: | |||
Accounts payable | 318 | 318 | |
Operating lease liabilities – short-term | 35,656 | 24,794 | 0 |
Total current liabilities | 286,668 | 309,518 | 284,724 |
Operating lease liabilities – long-term | 100,752 | 93,127 | 0 |
Other liabilities | 762 | 762 | |
Total liabilities | 794,591 | 732,209 | 614,288 |
Total equity | 420,338 | 420,338 | |
Total liabilities and equity | $ 1,211,817 | 1,152,547 | $ 1,034,626 |
Accounting Standards Update 2016-02 | |||
ASSETS | |||
Property, plant and equipment – net | 0 | ||
Operating lease right-of-use assets | 117,921 | ||
Total assets | 117,921 | ||
Current liabilities: | |||
Accounts payable | 0 | ||
Operating lease liabilities – short-term | 24,794 | ||
Total current liabilities | 24,794 | ||
Operating lease liabilities – long-term | 93,127 | ||
Other liabilities | 0 | ||
Total liabilities | 117,921 | ||
Total equity | 0 | ||
Total liabilities and equity | $ 117,921 |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities After Adoption (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Operating Leases | |
2019 (remainder) | $ 10,987 |
2020 | 41,576 |
2021 | 29,838 |
2022 | 20,578 |
2023 | 12,391 |
Thereafter | 70,375 |
Total lease payments | 185,745 |
Less imputed interest | (49,337) |
Total | 136,408 |
Finance Leases | |
2019 (remainder) | 194 |
2020 | 708 |
2021 | 472 |
2022 | 151 |
2023 | 0 |
Thereafter | 0 |
Total lease payments | 1,525 |
Less imputed interest | (81) |
Total | $ 1,444 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments Before Adoption (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Operating Leases | |
2019 | $ 36,110 |
2020 | 29,318 |
2021 | 16,111 |
2022 | 11,571 |
2023 | 9,104 |
Thereafter | 26,627 |
Total lease payments | 128,841 |
Capital Leases | |
2019 | 239 |
2020 | 212 |
2021 | 131 |
2022 | 89 |
2023 | 0 |
Thereafter | 0 |
Total lease payments | $ 671 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 9 Months Ended |
Sep. 30, 2019customer | |
Commitments and Contingencies Disclosure [Abstract] | |
Number of manufacturing locations | 3 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||||
Income taxes | $ 1,513 | $ 229 | $ 13,617 | $ 13,385 |
Out of period adjustment resulting in an income tax expense (benefit) | $ (1,000) | $ (900) | ||
Increase (decrease) in effective income tax rate due to period period adjustments | 9.90% | 18.20% | 1.60% | 1.80% |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value, Inputs, Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Royalty agreement, asset, fair value | $ 1 | |
Fair Value, Inputs, Level 2 | Interest Rate Contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability, fair value | $ (2.2) |
Derivative and Hedging Instru_3
Derivative and Hedging Instruments - Narrative (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | Nov. 06, 2018 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative loss reclassification from AOCI to income | $ 900,000 | ||
Customer Concentration Risk | Accounts Receivable | One Customer | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Concentration risk percentage | 22.00% | ||
Interest Rate Swap | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative, notional amount | 100,000,000 | ||
Derivative liability, fair value | $ 0 | ||
Derivative, amount of hedged item | $ 100,000,000 |
Derivative and Hedging Instru_4
Derivative and Hedging Instruments - Balance Sheet Classification (Details) - Designated as Hedging Instrument - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Derivative [Line Items] | ||
Derivative liability, fair value | $ (2,246) | $ (833) |
Interest Rate Contracts | ||
Derivative [Line Items] | ||
Derivative liability, fair value | $ (2,246) | $ (833) |
Derivative and Hedging Instru_5
Derivative and Hedging Instruments - Adjustments Related to Cash Flow Hedges on the Comprehensive Income Statement (Details) - Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
AOCI Attributable To Parent, Before Tax [Roll Forward] | |
Loss on derivative instruments included in Accumulated other comprehensive income at December 31, 2018 | $ (833) |
Fair value adjustment | (1,413) |
Loss on derivative instruments included in Accumulated other comprehensive income at September 30, 2019 | $ (2,246) |
Restructuring - Restructuring C
Restructuring - Restructuring Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Jun. 30, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | |
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring charges | $ 12,600 | $ 12,623 | $ 0 |
Write-off of equipment and facility | |||
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring charges | 7,131 | ||
Employee separations | |||
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring charges | 2,686 | ||
Facility exit costs | |||
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring charges | 1,364 | ||
Inventory write-downs | |||
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring charges | $ 1,442 |
Restructuring - Components of R
Restructuring - Components of Restructuring Activities (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Restructuring Reserve [Roll Forward] | |
Accrual balance at December 31, 2018 | $ 0 |
Charges | 4,050 |
Cash payments | (1,467) |
Accrual balance at September 30, 2019 | 2,583 |
Employee separations | |
Restructuring Reserve [Roll Forward] | |
Accrual balance at December 31, 2018 | 0 |
Charges | 1,364 |
Cash payments | (1,364) |
Accrual balance at September 30, 2019 | 0 |
Facility exit costs | |
Restructuring Reserve [Roll Forward] | |
Accrual balance at December 31, 2018 | 0 |
Charges | 2,686 |
Cash payments | (103) |
Accrual balance at September 30, 2019 | $ 2,583 |