Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 03, 2020 | Jun. 28, 2019 | |
Cover page. | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 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 | 7054 | ||
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 Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
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 Public Float | $ 683 | ||
Entity Common Stock, Shares Outstanding | 27,914,777 | ||
Documents Incorporated by Reference | Documents Incorporated by Reference Part III: Proxy Statement for Annual Meeting of Stockholders to be held June 23, 2020. | ||
Current Fiscal Year End Date | --12-31 | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001673985 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | |||
Sales | $ 1,297,393 | $ 1,514,984 | $ 1,475,194 |
Costs, expenses and other: | |||
Cost of Goods and Services Sold | 1,161,921 | 1,340,497 | 1,248,129 |
Selling, general and administrative expenses | 75,375 | 81,224 | 72,671 |
Other non-operating expense (income), net | 6,749 | 7,495 | 9,762 |
Total costs, expenses and other | 1,244,045 | 1,429,216 | 1,330,562 |
Income (loss) before taxes | 53,348 | 85,768 | 144,632 |
Income tax expense (benefit) | 12,001 | 19,524 | (2,067) |
Net income | $ 41,347 | $ 66,244 | $ 146,699 |
Earnings per common share | |||
Basic (in dollars per share) | $ 1.47 | $ 2.20 | $ 4.81 |
Diluted (in dollars per share) | $ 1.43 | $ 2.14 | $ 4.72 |
Weighted average common shares outstanding | |||
Basic (in shares) | 28,122,288 | 30,172,050 | 30,482,966 |
Diluted (in shares) | 28,898,836 | 30,978,291 | 31,091,601 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 41,347 | $ 66,244 | $ 146,699 |
Foreign exchange translation adjustments | (9) | (25) | 12 |
Cash-flow hedges | (673) | (633) | 0 |
Cash-flow hedges | 0 | ||
Pension obligation adjustments | (6,295) | 7,230 | (6,023) |
Other comprehensive income (loss), net of tax | (6,977) | 6,572 | (6,011) |
Comprehensive income | $ 34,370 | $ 72,816 | $ 140,688 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 7,050 | $ 9,808 |
Accounts and other receivables – net | 106,660 | 160,266 |
Inventories – net | 171,710 | 137,182 |
Other current assets | 5,117 | 3,807 |
Total current assets | 290,537 | 311,063 |
Property, plant and equipment – net | 755,881 | 672,210 |
Operating Lease, Right-of-Use Asset | 135,985 | |
Goodwill | 15,005 | 15,005 |
Other assets | 38,561 | 36,348 |
Total assets | 1,235,969 | 1,034,626 |
Current liabilities: | ||
Accounts payable | 205,911 | 231,720 |
Accrued liabilities | 28,114 | 30,448 |
Operating lease liabilities – short term | 38,005 | |
Deferred income and customer advances | 19,696 | 22,556 |
Total current liabilities | 291,726 | 284,724 |
Deferred income taxes | 110,071 | 103,783 |
Operating lease liabilities – long term | 98,347 | |
Line of credit – long-term | 297,000 | 200,000 |
Postretirement benefit obligations | 32,410 | 21,080 |
Other liabilities | 5,537 | 4,701 |
Total liabilities | 835,091 | 614,288 |
COMMITMENTS AND CONTINGENCIES (Note 12) | ||
STOCKHOLDERS' EQUITY | ||
Common stock, par value $0.01; 200,000,000 shares authorized; 31,423,898 shares issued and 27,914,777 outstanding at December 31, 2019; 30,555,715 shares issued and 29,345,001 outstanding at December 31, 2018 | 314 | 306 |
Preferred stock, par value $0.01; 50,000,000 shares authorized; 0 shares issued and outstanding at December 31, 2019 and 2018 | 0 | 0 |
Treasury stock at par (3,509,121 shares at December 31, 2019; 1,210,714 shares at December 31, 2018) | (35) | (12) |
Additional paid-in capital | 180,884 | 234,699 |
Retained earnings (accumulated deficit) | 229,166 | 187,819 |
Accumulated other comprehensive loss | (9,451) | (2,474) |
Total stockholders' equity | 400,878 | 420,338 |
Total liabilities and stockholders' equity | $ 1,235,969 | $ 1,034,626 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares | Dec. 31, 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) | 31,423,898 | 30,555,715 |
Common stock, shares outstanding (in shares) | 27,914,777 | 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) | 3,509,121 | 1,210,714 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | ||||||||
Net income | $ (2,094,000) | $ 20,174,000 | $ 20,761,000 | $ 11,593,000 | $ 41,347,000 | $ 66,244,000 | $ 146,699,000 | |
Adjustments to reconcile net income to net cash (used for) provided by operating activities: | ||||||||
Depreciation and amortization | 56,826,000 | 53,233,000 | 48,455,000 | |||||
Loss on disposal of assets | 5,190,000 | 1,992,000 | 1,500,000 | |||||
Deferred income taxes | 8,442,000 | 9,558,000 | (7,513,000) | |||||
Stock based compensation | 8,349,000 | 10,131,000 | 7,742,000 | |||||
Accretion of deferred financing fees | 427,000 | 1,802,000 | 592,000 | |||||
Restructuring charges | 11,020,000 | 0 | 0 | |||||
Changes in assets and liabilities: | ||||||||
Accounts and other receivables | 53,676,000 | 35,712,000 | (64,320,000) | |||||
Inventories | (35,567,000) | (7,974,000) | (230,000) | |||||
Accounts payable | (20,333,000) | 2,280,000 | 8,087,000 | |||||
Accrued liabilities | (4,561,000) | (6,111,000) | 9,617,000 | |||||
Deferred income and customer advances | (2,860,000) | 5,362,000 | (8,373,000) | |||||
Other assets and liabilities | (1,571,000) | 1,156,000 | (7,649,000) | |||||
Net cash provided by operating activities | 120,385,000 | 173,385,000 | 134,607,000 | |||||
Cash flows from investing activities: | ||||||||
Expenditures for property, plant and equipment | (150,322,000) | (109,215,000) | (86,438,000) | |||||
Other investing activities | (2,803,000) | (2,976,000) | (6,809,000) | |||||
Net cash used for investing activities | (153,125,000) | (112,191,000) | (93,247,000) | |||||
Cash flows from financing activities: | ||||||||
Payments of long-term debt | 0 | (266,625,000) | 0 | |||||
Borrowings from line of credit | 419,250,000 | 345,000,000 | 308,500,000 | |||||
Payments of line of credit | (322,250,000) | (145,000,000) | (308,500,000) | |||||
Payment of debt issuance costs | 0 | (1,361,000) | 0 | |||||
Principal payments of finance leases | (4,839,000) | (308,000) | (127,000) | |||||
Purchase of treasury stock | (62,196,000) | (38,524,000) | 0 | |||||
Issuance of common stock | 17,000 | 0 | 0 | |||||
Net cash provided by (used for) financing activities | 29,982,000 | (106,818,000) | (127,000) | |||||
Net change in cash and cash equivalents | (2,758,000) | (45,624,000) | 41,233,000 | |||||
Cash and cash equivalents at beginning of year | $ 9,808,000 | $ 55,432,000 | 9,808,000 | 55,432,000 | 14,199,000 | |||
Cash and cash equivalents at the end of year | $ 7,050,000 | $ 9,808,000 | 7,050,000 | 9,808,000 | 55,432,000 | $ 14,199,000 | ||
Supplemental non-cash investing activities: | ||||||||
Capital expenditures included in accounts payable | 21,594,000 | 27,258,000 | 25,222,000 | |||||
Supplemental cash activities: | ||||||||
Cash paid for interest | 5,201,000 | 5,855,000 | 7,236,000 | |||||
Cash paid for income taxes | $ 6,993,000 | $ 7,315,000 | $ 12,982,000 | $ 12,982,000 |
CONSOLIDATED STATEMENTS OF STOC
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) |
Balance (in shares) at Dec. 31, 2016 | 30,482,966 | |||||
Balance at Dec. 31, 2016 | $ 215,362 | $ 305 | $ 242,806 | $ (24,714) | $ (3,035) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 146,699 | 146,699 | ||||
Foreign exchange translation adjustments | 12 | 12 | ||||
Commodity hedges | 0 | |||||
Pension obligation adjustments | (6,023) | (6,023) | ||||
Other comprehensive income (loss), net of tax | (6,011) | (6,011) | ||||
Change in invested equity and spin-off deferred tax adjustments | 12,533 | 12,533 | ||||
Stock-based compensation | 7,742 | 7,742 | ||||
Balance (in shares) at Dec. 31, 2017 | 30,482,966 | |||||
Balance at Dec. 31, 2017 | 376,325 | $ 305 | 263,081 | 121,985 | $ 0 | (9,046) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 66,244 | 66,244 | ||||
Foreign exchange translation adjustments | (25) | (25) | ||||
Commodity hedges | (633) | (633) | ||||
Pension obligation adjustments | 7,230 | |||||
Pension obligation adjustments | 6,820 | (410) | 7,230 | |||
Other comprehensive income (loss), net of tax | 6,162 | (410) | 6,572 | |||
Issuance of common stock and reclassification of invested equity (in Shares) | 72,749 | |||||
Issuance of common stock and reclassification of invested equity | 1 | $ 1 | ||||
Acquisition of treasury stock (1,210,714 shares) | (38,525) | (38,513) | (12) | |||
Stock-based compensation | $ 10,131 | 10,131 | ||||
Balance (in shares) at Dec. 31, 2018 | 29,345,001 | 30,555,715 | ||||
Balance at Dec. 31, 2018 | $ 420,338 | $ 306 | 234,699 | 187,819 | (12) | (2,474) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 41,347 | 41,347 | ||||
Foreign exchange translation adjustments | (9) | (9) | ||||
Commodity hedges | (673) | (673) | ||||
Pension obligation adjustments | (6,295) | (6,295) | ||||
Other comprehensive income (loss), net of tax | (6,977) | (6,977) | ||||
Issuance of common stock and reclassification of invested equity (in Shares) | 868,183 | |||||
Issuance of common stock and reclassification of invested equity | 17 | $ 8 | 9 | |||
Acquisition of treasury stock (1,210,714 shares) | (62,196) | (62,173) | (23) | |||
Stock-based compensation | $ 8,349 | 8,349 | ||||
Balance (in shares) at Dec. 31, 2019 | 27,914,777 | 31,423,898 | ||||
Balance at Dec. 31, 2019 | $ 400,878 | $ 314 | $ 180,884 | $ 229,166 | $ (35) | $ (9,451) |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (PARENTHETICAL) - shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Number of shares repurchased (in shares) | 1,898,013 | |
Treasury Stock | ||
Number of shares repurchased (in shares) | 2,298,407 | 1,210,714 |
Organization, Operations and Ba
Organization, Operations and Basis of Presentation | 12 Months Ended |
Dec. 31, 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 fibers, filaments, engineered plastics and films that, in turn, are used in such end-products as carpets, automotive and electronic components, sports apparel, food packaging and other industrial applications. 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 manufacturing value chain including caprolactam, ammonium sulfate fertilizers, acetone and other chemical intermediates. We evaluated segment reporting in accordance with Accounting Standards Codification Topic (“ASC”) 280. We concluded that AdvanSix is a single operating segment and a single reportable segment based on the operating results available which are evaluated regularly by the chief operating decision maker (“CODM”) to make decisions about resource allocation and performance assessment. AdvanSix operations are managed as one integrated process spread across three manufacturing sites, including centralized supply chain and procurement functions. The production process is dependent upon one key raw material, cumene, as the input to the manufacturing of all finished goods produced for sale through the sales channels and end-markets the Company serves. Production rates and output volumes are managed across all three plants jointly to align with the overall Company operating plan. The CODM makes operational performance assessments and resource allocation decisions on a consolidated basis, inclusive of all of the Company’s products. AdvanSix operates through three integrated U.S.-based manufacturing sites located in Frankford, Pennsylvania, and Hopewell and Chesterfield, Virginia. The Company's headquarters is located in Parsippany, New Jersey. Corporate History On October 1, 2016, Honeywell International Inc. (“Honeywell”) completed the separation of AdvanSix. The separation was completed by Honeywell distributing (the "Distribution") all of the then outstanding shares of common stock of AdvanSix on October 1, 2016 (the “Distribution Date”) through a dividend in kind of AdvanSix common stock, par value $0.01 per share, to holders of Honeywell common stock as of the close of business on the record date of September 16, 2016 who held their shares through the Distribution Date (the “Spin-Off”). Basis of Presentation Unless the context otherwise requires, references in these Notes to the Consolidated Financial Statements to “we,” “us,” “our,” “AdvanSix” and the “Company” refer to AdvanSix Inc. and its consolidated subsidiaries after giving effect to the Spin-Off. All intercompany transactions have been eliminated. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Accounting Principles – The financial statements and accompanying Notes are prepared in accordance with accounting principles generally accepted in the United States of America. The following is a description of AdvanSix’s significant accounting policies. Principles of Consolidation – The Consolidated Financial Statements include the accounts of AdvanSix and all of its subsidiaries in which a controlling financial interest is maintained. Our consolidation policy requires equity investments that we exercise significant influence over but do not control the investee and are not the primary beneficiary of the investee’s activities to be accounted for using the equity method. Investments through which we are not able to exercise significant influence over the investee and which we do not have readily determinable fair values are accounted for under the cost method. All intercompany transactions and balances are eliminated in consolidation. Cash and Cash Equivalents – Cash and cash equivalents include cash on hand and on deposit and highly liquid, temporary cash investments with an original maturity to the Company of three months or less. We reduce cash and extinguish liabilities when the creditor receives our payment and we are relieved of our obligation for the liability when checks clear the Company’s bank account. Liabilities to creditors to whom we have issued checks that remain outstanding aggregated $1.7 million at December 31, 2019 and are included in Cash and cash equivalents and Accounts payable in the Consolidated Balance Sheets. Fair Value Measurement – ASC 820, Fair Value Measurement defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Financial Accounting Standards Board's ("FASB") guidance classifies the inputs used to measure fair value into the following hierarchy: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities Level 2 Unadjusted quoted prices in active markets for similar assets or liabilities, or Unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or Inputs other than quoted prices that are observable for the asset or liability Level 3 Unobservable inputs for the asset or liability Derivative Financial Instruments – We minimize our risks from interest and foreign currency exchange rate fluctuations through our normal operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. Derivative financial instruments are used to manage risk and are not used for trading or other speculative purposes. Derivative financial instruments that qualify for hedge accounting must be designated and effective as a hedge of the identified risk exposure at the inception of the contract. Accordingly, changes in fair value of the derivative contract must be highly correlated with changes in fair value of the underlying hedged item at inception of the hedge and over the life of the hedge contract. All derivatives are recorded on the balance sheet as assets or liabilities and measured at fair value. For derivatives designated as hedges of the fair value of assets or liabilities, the changes in fair values of both the derivatives and the hedged items are recorded in current earnings. For derivatives designated as cash flow hedges, the changes in fair value of the derivatives are recorded in Accumulated other comprehensive income (loss) and subsequently recognized in earnings when the hedged items impact earnings. Cash flows of such derivative financial instruments are classified consistent with the underlying hedged item. For derivative instruments that are designated and qualify as a net investment hedge, the derivative’s gain or loss is reported as a component of Other comprehensive income (loss) and recorded in Accumulated other comprehensive income (loss). The gain or loss will be subsequently reclassified into net earnings when the hedged net investment is either sold or substantially liquidated. Commodity Price Risk Management – The Company's exposure to market risk for commodity prices can result in changes in our 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 they do not include take-or-pay terms. Instead, each customer agreement, the majority of which have a term of at least one year, is typically determined by monthly or quarterly volume estimates. 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 December 31, 2019 and 2018, we had no contracts with notional amounts related to forward commodity agreements. Inventories – Substantially all of the Company's inventories are valued at the lower of cost or market using the last-in, first-out (“LIFO”) method. The Company includes spare and other parts in inventory which are used in support of production or production facilities operations and are valued based on weighted average cost. Inventories valued at LIFO amounted to $171.7 million and $137.2 million at December 31, 2019 and 2018. Had such LIFO inventories been valued at current costs, their carrying values would have been approximately $31.6 million and $28.5 million higher at December 31, 2019 and 2018. Property, Plant, Equipment – Property, plant, equipment asset values are recorded at cost, including any asset retirement obligations, less accumulated depreciation. For financial reporting, the straight-line method of depreciation is used over the estimated useful lives of 30 to 50 years for buildings and improvements and 5 to 40 years for machinery and equipment. Our machinery and equipment includes (1) assets used in short production cycles or subject to high corrosion, such as instrumentation, controls and insulation systems with useful lives up to 15 years, (2) standard plant assets, such as boilers and railcars, with useful lives ranging from 15 to 30 years and (3) major process equipment that can be used for long durations with effective preventative maintenance and repair, such as cooling towers, compressors, tanks and turbines with useful lives ranging from 5 to 40 years. Recognition of the fair value of obligations associated with the retirement of tangible long-lived assets is required when there is a legal obligation to incur such costs. Upon initial recognition of a liability, the cost is capitalized as part of the related long-lived asset and depreciated over the corresponding asset’s useful life. Repairs and maintenance, including planned major maintenance, are expensed as incurred. Costs which materially add to the value of the asset or prolong its useful life are capitalized and the replaced assets are retired. Long-Lived Assets – The Company evaluates the recoverability of the carrying amount of long-lived assets (including property, plant and equipment and intangible assets with determinable lives) whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. The Company evaluates events or changes in circumstances based on several factors including operating results, business plans and forecasts, general and industry trends, and economic projections and anticipated cash flows. An impairment is assessed when the undiscounted expected future cash flows derived from an asset are less than its carrying amount. Impairment losses are measured as the amount by which the carrying value of an asset exceeds its fair value and are recognized in the Consolidated Statements of Operations. The Company also evaluates the estimated useful lives of long-lived assets if circumstances warrant and revises such estimates based on current events. Goodwill – The Company had goodwill of $15.0 million as of December 31, 2019 and 2018. Goodwill is subject to impairment testing annually as of March 31, or whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. The Company first assesses qualitative factors as described in ASC 350 to determine whether it is necessary to perform the quantitative goodwill impairment test. The Company completed its annual goodwill impairment test as of March 31, 2019 and, based on the results of the Company's assessment of qualitative factors, it was determined that it was not necessary to perform the quantitative goodwill impairment test. Revenue Recognition – The Company recognizes revenue upon the transfer of control of goods or services to customers at amounts that reflect the consideration expected to be received. AdvanSix primarily recognizes revenues when title and control of the product transfers from the Company to the customer. Outbound shipping costs incurred by the Company are not included in revenues but are reflected as freight expense in Costs of goods sold in the Consolidated Statements of Operations. Sales of our products to customers are made under a purchase order, and in certain cases in accordance with the terms of a master services agreement. These agreements typically contain formula-based pass-through pricing tied to key feedstock materials and volume ranges, but often do not specify the goods, including the quantities thereof, to be transferred. Certain master services agreements (including with respect to our largest customer) may contain minimum purchase volumes which can be satisfied by the customer on a periodic basis by choosing from various products offered by the Company. In these cases, a performance obligation is created when a customer submits a purchase order for a specific product at a specified price, typically providing for delivery within the next 60 days. Management considers the performance obligation with respect to such purchase order satisfied at the point in time when control of the product is transferred to the customer, which is indicated by shipment of the product and transfer of title and risk of loss to the customer. Transfer of control to the customer occurs through various modes of shipment, including trucks, railcars, and vessels, and follows a variety of commercially acceptable shipping or destination point terms pursuant to the arrangement with the customer. Variable consideration is estimated for future volume rebates and early pay discounts on certain products and product returns. The Company records variable consideration as an adjustment to the sale transaction price. Since variable consideration is generally settled within one year, the time value of money is not significant. The Company applies the practical expedient in Topic 606 and does not include disclosures regarding remaining performance obligations that have original expected durations of one year or less, or amounts for variable consideration allocated to wholly-unsatisfied performance obligations or wholly-unsatisfied distinct goods that form part of a single performance obligation, if any. The Company also utilizes the practical expedient in Topic 606 and does not include an adjustment for the effects of a significant financing component given the expected period duration of one year or less. Environmental – AdvanSix accrues costs related to environmental matters when it is probable that we have incurred a liability related to a contaminated site and the amount can be reasonably estimated. Deferred Income and Customer Advances – AdvanSix has an annual pre-buy program for ammonium sulfate that is classified as deferred income and customer advances in the Consolidated Balance Sheets. Customers pay cash in advance to reserve capacity for ammonium sulfate to guarantee product availability during peak planting season. The Company recognizes a customer advance when cash is received for the advanced buy. Revenue is then recognized and the customer advance is relieved upon title transfer of ammonium sulfate. Trade Receivables and Allowance for Doubtful Accounts – Trade accounts receivables are recorded at the invoiced amount as a result of transactions with customers. AdvanSix maintains allowances for doubtful accounts for estimated losses based on a customer’s inability to make required payments. AdvanSix estimates anticipated losses from doubtful accounts based on days past due, as measured from the contractual due date and historical collection history and incorporates changes in economic conditions that may not be reflected in historical trends such as customers in bankruptcy, liquidation or reorganization. Receivables are written-off against the allowance for doubtful accounts when they are determined uncollectible. Such determination includes analysis and consideration of the particular conditions of the account, including time intervals since last collection, customer performance against agreed upon payment plans, success of outside collection agencies activity, solvency of customer and any bankruptcy proceedings. Research and Development – AdvanSix conducts research and development (“R&D”) activities, which consist primarily of the development of new products and product applications consisting primarily of labor costs and depreciation and maintenance costs. R&D costs are charged to expense as incurred. Such costs are included in costs of goods sold and were $13.9 million, $14.8 million, and $12.9 million for the years ended December 31, 2019, 2018 and 2017, respectively. Debt Issuance Costs – Debt issuance costs are capitalized as a component of Other assets and are amortized through interest expense over the related term. Stock-Based Compensation Plans – The principal awards issued under our stock-based compensation plans, which are described in "Note 16. Stock-Based Compensation Plans", are non-qualified stock options, performance share units and restricted stock units. The cost for such awards is measured at the grant date based on the fair value of the award. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods (generally the vesting period of the equity award) and is included in selling, general and administrative expenses. Forfeitures are estimated at the time of grant to recognize expense for those awards that are expected to vest and are based on our historical forfeiture rates. Pension Benefits – We have a defined benefit plan covering certain employees primarily in the U.S. The benefits are accrued over the employees’ service periods. We use actuarial methods and assumptions in the valuation of defined benefit obligations and the determination of net periodic pension income or expense. Differences between actual and expected results or changes in the value of defined benefit obligations and fair value of plan assets, if any, are not recognized in earnings as they occur but rather systematically over subsequent periods when net actuarial gains or losses are in excess of 10% of the greater of the fair value of plan assets or the plan’s projected benefit obligation. Foreign Currency Translation – Assets and liabilities of subsidiaries operating outside the United States with a functional currency other than U.S. dollars are translated into U.S. dollars using year-end exchange rates. Sales, costs and expenses are translated at the average exchange rates in effect during the year. Foreign currency translation gains and losses are included as a component of Accumulated other comprehensive income (loss) in our Consolidated Balance Sheets. Income Taxes – We account for income taxes pursuant to the asset and liability method which requires us to recognize current tax liabilities or receivables for the amount of taxes we estimate are payable or refundable for the current year and deferred tax assets and liabilities for the expected future tax consequences attributable to temporary differences between the financial statement carrying amounts and their respective tax bases of assets and liabilities and the expected benefits of net operating loss and credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period enacted. A valuation allowance is provided when it is more likely than not that a portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income and the reversal of deferred tax liabilities during the period in which related temporary differences become deductible. We adopted the provisions of ASC 740 related to the accounting for uncertainty in income taxes recognized in an enterprise’s consolidated financial statements. ASC 740 prescribes a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be taken in income tax returns. The benefit of tax positions taken or expected to be taken in our income tax returns are recognized in the financial statements if such positions are more likely than not of being sustained upon examination by taxing authorities. Differences between tax positions taken or expected to be taken in a tax return and the benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits”. A liability is recognized (or amount of net operating loss carryover or amount of tax refundable is reduced) for an unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC 740. Interest costs and related penalties related to unrecognized tax benefits are required to be calculated, if applicable. Our policy is to classify tax related interest and penalties, if any, as a component of income tax expense. No interest or penalties related to unrecognized income tax benefits were recorded during the years ended December 31, 2019, 2018 and 2017. As of December 31, 2019 and 2018, no liability for unrecognized tax benefits was required to be reported. We do not expect any significant changes in our unrecognized tax benefits in the next year. On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 ("SAB 118") to address the application of US GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the 2017 Act. SAB 118 provides guidance for registrants under three scenarios where the measurement of certain tax items is either complete, can be reasonably estimated or cannot be reasonably estimated. The Company has completed its evaluation of the 2017 Act and the impacts of those items have been reflected in our Consolidated Financial Statements as of December 31, 2018 and 2017. The impacts of those changes are disclosed in “Note 4. Income Taxes”. Leases – The Company enters into agreements to lease transportation equipment, storage facilities, office space, dock access and other equipment. Operating leases have initial terms of up to 20 years with some containing renewal options subject to customary conditions. An arrangement is considered to be a lease if the agreement conveys the right to control the use of the identified asset in exchange for consideration. Operating leases, which are reported as Operating lease right-of-use assets, and Operating lease liabilities – short-term and Operating lease liabilities – long-term are included in our Consolidated Balance Sheets. Finance leases are included as a component of Property, plant and equipment – net, Accounts payable and Other liabilities in our Consolidated Balance Sheets. The Company has elected the following practical expedients available in Topic 842: • the package of three expedients which allows the Company to not 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 Consolidated Balance Sheets; • the bifurcation of lease and non-lease components practical expedients, which did not require the Company to bifurcate lease and non-lease components for 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. Earnings Per Share – Basic earnings per share is based on the weighted average number of common shares outstanding. Diluted earnings per share is based on the weighted average number of common shares outstanding and all dilutive potential common shares outstanding. Treasury Stock – The Company has elected to account for treasury stock purchased under the constructive retirement method. For shares repurchased in excess of par, the company will allocate the excess value to additional paid-in capital. Use of Estimates – The preparation of the Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the Consolidated Financial Statements and related disclosures in the accompanying Notes. Actual results could differ from those estimates. Estimates and assumptions are periodically reviewed and the effects of changes are reflected in the Consolidated Financial Statements in the period they are determined to be necessary. Reclassifications – Certain prior period amounts have been reclassified for consistency with the current period presentation. All reclassified amounts have been immaterial. Recent Accounting Pronouncements – The Company considers the applicability and impact of all Accounting Standards Updates (“ASU’s”) issued by the FASB. ASU’s not discussed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Consolidated Financial Statements. On December 18, 2019, the FASB issued ASU No. 2019-12 , Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The ASU removes the exception to the general principles in ASC 740, Income Taxes, associated with the incremental approach for intra-period tax allocation, accounting for basis differences when there are ownership changes in foreign investments and interim-period income tax accounting for year-to-date losses that exceed anticipated losses. In addition, the ASU improves the application of income tax related guidance and simplifies U.S. GAAP when accounting for franchise taxes that are partially based on income, transactions with government resulting in a step-up in tax basis goodwill, separate financial statements of legal entities not subject to tax, and enacted changes in tax laws in interim periods. Different transition approaches, retrospective, modified retrospective, or prospective, will apply to each income tax simplification provision. The guidance is effective for calendar-year public business entities in 2021 and interim periods within that year, and early adoption is permitted. The Company is still evaluating these changes and does not anticipate any material impact on the Company’s consolidated financial position or results of operations upon adoption. 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 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, that allows companies to reclassify to Retained earnings the stranded tax effects in Accumulated other comprehensive income resulting from the Tax Cuts and Jobs Act. The amendments in ASU 2018-02 are effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption of the amendments in this update is permitted, including adoption in any interim period. The Company elected to early adopt this guidance effective January 1, 2018 and to reclassify the stranded tax effects from the Tax Cuts and Jobs Act from Accumulated other comprehensive income to Retained earnings (refer to "Note 4. Income Taxes"). In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities which simplifies financial statement reporting for qualifying hedging relationships by eliminating the requirement to separately measure and report hedge ineffectiveness. For net investment hedges, the entire change in fair value of the hedging instruments is recorded in the currency translation adjustment section of other comprehensive income or loss. Pursuant to the amendments, these amounts are required to be subsequently reclassified to earnings in the same income statement line item in which the earnings effect of the hedged item is presented when the hedged item affects earnings. The amendments of ASU No. 2017-12 are effective for the Company’s fiscal years beginning after December 31, 2018, including interim periods within that fiscal year. Early adoption of these amendments is permitted, including in any interim period. The Company elected to early adopt the guidance in the period ended December 31, 2018. In March 2017, the FASB issued ASU 2017-07, Compensation – Retirement Benefits (Topic 715) in order to improve the presentation of net periodic pension and postretirement costs. The amendment requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost as defined in paragraphs 715-30-35-4 and 715-60-35-9 are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. The amendments in this ASU also allow only the service cost component to be eligible for capitalization when applicable. The amendments in this update related to income statement activity were applied retrospectively whereas balance sheet activity was applied prospectively. For public business entities, the effective date for ASU 2017-07 was annual periods beginning after December 15, 2017, including interim periods within those annual periods. Early adoption is permitted within the first interim period. The Company adopted this guidance effective January 1, 2018 and there was no impact on the Company’s consolidated financial position and results of operations upon adoption other than immaterial pension expense reclassifications in the 2017 and 2016 Consolidated Statements of Operations which reduced Cost of goods sold and Selling, general and administrative expenses and increased Other non-operating expense (income), net. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments which clarifies how entities should classify certain cash receipts and cash payments on the statement of cash flows. The amended guidance addresses eight specific cash flow issues, including debt prepayment or extinguishment costs, and clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. Entities are required to apply the guidance retrospectively and provide the relevant disclosure in ASC 250. For public business entities, the effective date for ASU 2017-07 was annual periods beginning after December 15, 2017, including interim periods within those annual periods. Early adoption is permitted. The Company adopted this guidance effective January 1, 2018 and there was no impact on the Company’s consolidated financial position, results of operations or cash flows upon adoption on the 2018 Consolidated Statement of Cash Flows. 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 to not 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 Consolidated Balance Sheets; • 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 Consolidated Balance Sheet but did not have a significant impact in the recognition, measurement or presentation of lease expenses within the Consolidated Statements of Operations or the 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. In May 2014, the FASB issued ASU 2014-09, |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | RevenueWe serve approximately 400 customers annually in more than 40 countries and across a wide variety of industries. For 2019, 2018 and 2017, the Company's ten largest customers accounted for approximately 47%, 45% and 44% of total sales, respectively. We typically sell to customers under master services agreements, with primarily one-year terms, 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"), a significant consumer of caprolactam and Nylon 6 resin. We sell Nylon 6 resin and caprolactam to Shaw under a long-term agreement. Sales to Shaw were 22% of our total sales for each of the years ended December 31, 2019, 2018 and 2017. Each of the Company’s product lines represented the following approximate percentage of total sales for 2019, 2018 and 2017: Years Ended December 31, 2019 2018 2017 Nylon 27% 28% 29% Caprolactam 22% 19% 19% Ammonium Sulfate Fertilizer 23% 20% 19% Chemical Intermediates 28% 33% 33% 100% 100% 100% The Company’s revenues by geographic area for 2019, 2018 and 2017 were as follows (in millions): Years Ended December 31, 2019 2018 2017 United States $ 1,057 $ 1,271 $ 1,189 International 240 244 286 Total $ 1,297 $ 1,515 $ 1,475 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 twelve months ended December 31, 2019: Deferred Income and Customer Advances 2019 Opening balance January 1, 2019 $ 22,556 Additional cash advances 19,517 Less amounts recognized in revenues (22,377) Ending balance December 31, 2019 $ 19,696 The Company expects to recognize as revenue the December 31, 2019 ending balance of Deferred income and customer advances within one year or less. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Years Ended December 31, 2019 2018 2017 Income (loss) before taxes U.S. $ 53,231 $ 85,596 $ 144,499 Non-U.S. 117 172 133 $ 53,348 $ 85,768 $ 144,632 Income taxes Income tax expense (benefit) consists of: Years Ended December 31, 2019 2018 2017 Current Provision: Federal $ 2,519 $ 7,529 $ 3,682 State 1,007 2,442 1,743 Non-U.S. 24 27 22 Total current provision $ 3,550 $ 9,998 $ 5,447 Deferred Provision: Federal $ 7,536 $ 8,081 $ (6,824) State 907 1,435 (700) Non-U.S. 8 10 10 Total deferred provision 8,451 9,526 (7,514) Total income tax expense (benefit) $ 12,001 $ 19,524 $ (2,067) The U.S. federal statutory income tax rate is reconciled to the effective income tax rate as follows: Years Ended December 31, 2019 2018 2017 U.S. federal statutory income tax rate 21.0 % 21.0 % 35.0 % 2017 Act — % (1.9) % (37.6) % U.S. state income taxes 2.8 % 3.5 % 2.6 % U.S. state income tax rate change — % — % (1.7) % Manufacturing incentives — % — % (0.3) % Executive compensation limitations 1.5 % 1.2 % 0.7 % Tax credits (3.0) % (0.5) % — % Other, net 0.2 % (0.5) % (0.1) % 22.5 % 22.8 % (1.4) % On December 22, 2017 the U.S. government enacted significant changes to federal tax law following the passage of the Tax Cuts and Jobs Act (the “2017 Act”). In 2017, the Company reasonably estimated the accounting for the effects of the 2017 Act. In 2018, under Staff Accounting Bulletin No. 118 (“SAB 118”), we finalized the accounting for the 2017 Act and our financial statements for the year ended December 31, 2018 and 2017 reflect certain effects of the 2017 Act including a reduction in the corporate tax rate to 21% from 35% and changes made to executive compensation rules. As a result of changes to tax laws and tax rates under the 2017 Act, the Company recorded a reduction in income tax expense of $1,651 and $53,424 primarily related to the reduction in the federal corporate tax rate to 21% during the years ended December 31, 2018 and 2017, respectively. The Company's effective income tax rate for 2019 was slightly higher compared to the U.S. Federal statutory rate of 21% due primarily to state taxes and executive compensation deduction limitations, partially offset by the vesting of restricted stock units as well as current year research tax credits and additional credits claimed on the Company's 2018 U.S. federal income tax return. The Company's effective income tax rate for 2018 was higher compared to the U.S. Federal statutory rate of 21% due primarily to state taxes and executive compensation deduction limitations resulting from the 2017 Act, partially offset by income tax benefits associated with the filing of the 2017 U.S. Federal income tax return and the related completion of the accounting for the impacts of the 2017 Act. The Company’s effective income tax rate for 2017 was lower compared to the U.S. Federal statutory rate of 35% due primarily to the enactment of the 2017 Act and the related remeasurement of deferred tax assets and liabilities. Additionally, the Company made certain state tax apportionment elections in 2017 which resulted in a state income tax rate change and related income tax benefit. For 2019 , 2018 and 2017, there were no unrecognized tax benefits recorded by the Company. Although there are no unrecognized income tax benefits, when applicable, the Company’s policy is to report interest expense and penalties related to unrecognized income tax benefits in the income tax provision. The Company is subject to taxation in the United States and various states and foreign jurisdictions. As of December 31, 2019, tax years 2016, 2017 and 2018 are subject to examination by the tax authorities. Deferred tax assets (liabilities) The tax effects of temporary differences which give rise to future income tax benefits and expenses are as follows: December 31, 2019 2018 Deferred tax assets: Net Operating Loss $ 8,167 $ 27 Accruals and Reserves 2,859 4,158 Interest Expense Limitation 2,655 — Pension Obligation 7,318 4,804 Equity Compensation 1,695 1,979 Other 1,314 289 Total gross deferred tax assets 24,008 11,257 Less: Valuation Allowance — — Total deferred tax assets $ 24,008 $ 11,257 Deferred tax liabilities: Property, plant & equipment $ (123,915) $ (102,783) Intangibles (3,713) (3,280) Inventory (5,503) (8,252) Other (931) (698) Total deferred tax liabilities (134,062) (115,013) Net deferred taxes $ (110,054) $ (103,756) The net deferred taxes are primarily related to U.S. operations. As of December 31, 2019, we recognized a federal net operating loss ("NOL") carryforward of $38,301 which can be carried forward indefinitely. We also recognized state NOL carryforwards in multiple jurisdictions for $2,139 which generally begin to expire in 2039. The Company has a foreign NOL of $70 and $111, respectively, at December 31, 2019 and 2018 which is not subject to expiration. We recognized a research tax credit carryforward of $758 at December 31, 2019 which will expire in 2039. We believe that the federal, foreign and state NOL carryforwards, tax credit carryforwards and other deferred tax assets are more likely than not to be realized and we have not recorded a valuation allowance against the deferred tax assets. As a result of the early adoption of ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income , during the three months ended March 31, 2018, the Company elected to reclassify $0.4 million from Accumulated other comprehensive income to Retained earnings. The reclassification results from the remeasurement of deferred taxes pursuant to the Tax Cuts and Jobs Act related to the Company’s pension plan that was recognized as a component of Income taxes related to continuing operations for the year ended December 31, 2017 which was originally recognized in Other comprehensive income. The Company elected the optional transition method and recorded the adjustment at the beginning of the period of adoption of ASU 2018-02. The Company’s current accounting policy related to stranded tax effects in Accumulated other comprehensive income is to review and reclassify on an item by item basis. The Company's accounting policy is to record the tax impacts of Global intangible low-taxed income as a period cost. As of December 31, 2019 and 2018, there were no material undistributed earnings of the Company's non-U.S. subsidiaries and, as such, we have not provided a deferred tax liability for undistributed earnings. |
Accounts and Other Receivables
Accounts and Other Receivables - Net | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Accounts and Other Receivables - Net | Accounts and Other Receivables – Net December 31, 2019 2018 Accounts receivables $ 105,275 $ 166,017 Other 3,708 1,716 Total accounts and other receivables 108,983 167,733 Less – allowance for doubtful accounts (2,323) (7,467) Total accounts and other receivables – net $ 106,660 $ 160,266 The roll-forward of allowance for doubtful accounts are summarized in the table below: Balance at Beginning of Year Charged to Costs and Expenses Charged to Other Accounts Deductions Balance at End of Year Year ended December 31, 2019 $ 7,467 $ 274 $ (396) $ (5,022) $ 2,323 Year ended December 31, 2018 1,410 6,226 (187) 18 7,467 Year ended December 31, 2017 3,211 725 (34) (2,492) 1,410 |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories December 31, 2019 2018 Raw materials $ 63,644 $ 55,002 Work in progress 56,065 46,728 Finished goods 58,527 39,368 Spares and other 25,035 24,555 203,271 165,653 Reduction to LIFO cost basis (31,561) (28,471) Total inventories $ 171,710 $ 137,182 |
Property, Plant, Equipment - Ne
Property, Plant, Equipment - Net | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant, Equipment - Net | Property, Plant, Equipment – Net December 31, 2019 2018 Land and improvements $ 6,396 $ 6,396 Machinery and equipment 1,337,234 1,308,865 Buildings and improvements 184,951 173,328 Construction in progress 97,143 80,720 1,625,724 1,569,309 Less – accumulated depreciation (869,843) (897,099) Total property, plant, equipment – net $ 755,881 $ 672,210 Capitalized interest was $6,359, $3,619 and $3,637 for the years ended December 31, 2019, 2018 and 2017, respectively. Depreciation expense was $53,424, $49,729 and $46,428 for the years ended December 31, 2019, 2018 and 2017, respectively. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases, Operating [Abstract] | |
Leases | Leases We determine if an arrangement is a lease at inception. Operating leases, which are reported as Operating lease right-of-use assets, and Operating lease liabilities – short-term, and Operating lease liabilities – long-term are included in our Consolidated Balance Sheets. Finance leases are included in Property, plant and equipment – net, Accounts payable, and Other liabilities in our 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 Consolidated Balance Sheets. Lease expense for all operating 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 operating 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: Year ended December 31, 2019 Finance lease cost: Amortization of right-of-use asset $ 661 Interest on lease liabilities 70 Total finance lease cost 731 Operating lease cost 36,454 Short-term lease cost 12,885 Total lease cost $ 50,070 Supplemental cash flow information related to leases was as follows: Year ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 36,165 Operating cash flows from finance leases 65 Financing cash flows from finance leases 4,839 Non-cash information: Right-of-use assets obtained in exchange for lease obligations: Operating leases 45,541 Finance leases 1,031 Supplemental balance sheet information related to leases was as follows: December 31, 2019 Operating Leases Operating lease right-of-use assets $ 135,985 Operating lease liabilities – short term 38,005 Operating lease liabilities – long term 98,347 Total operating lease liabilities $ 136,352 Finance Leases Property, plant and equipment – gross $ 2,793 Accumulated depreciation (1,391) Property, plant and equipment – net $ 1,402 Accounts payable 712 Other liabilities 708 Total finance lease liabilities $ 1,420 Weighted Average Remaining Lease Term Operating leases 9.1 years Finance leases 2.2 years Weighted Average Discount Rate Operating leases 5.72 % Finance leases 4.79 % The cumulative effect of the changes made to the 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 are as follows: Year Ending December 31, Operating Finance 2020 $ 44,454 $ 762 2021 32,264 522 2022 22,602 193 2023 13,033 11 2024 11,166 8 Thereafter 61,506 — Total lease payments 185,025 1,496 Less imputed interest (48,673) (76) Total $ 136,352 $ 1,420 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 Capital 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, which are reported as Operating lease right-of-use assets, and Operating lease liabilities – short-term, and Operating lease liabilities – long-term are included in our Consolidated Balance Sheets. Finance leases are included in Property, plant and equipment – net, Accounts payable, and Other liabilities in our 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 Consolidated Balance Sheets. Lease expense for all operating 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 operating 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: Year ended December 31, 2019 Finance lease cost: Amortization of right-of-use asset $ 661 Interest on lease liabilities 70 Total finance lease cost 731 Operating lease cost 36,454 Short-term lease cost 12,885 Total lease cost $ 50,070 Supplemental cash flow information related to leases was as follows: Year ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 36,165 Operating cash flows from finance leases 65 Financing cash flows from finance leases 4,839 Non-cash information: Right-of-use assets obtained in exchange for lease obligations: Operating leases 45,541 Finance leases 1,031 Supplemental balance sheet information related to leases was as follows: December 31, 2019 Operating Leases Operating lease right-of-use assets $ 135,985 Operating lease liabilities – short term 38,005 Operating lease liabilities – long term 98,347 Total operating lease liabilities $ 136,352 Finance Leases Property, plant and equipment – gross $ 2,793 Accumulated depreciation (1,391) Property, plant and equipment – net $ 1,402 Accounts payable 712 Other liabilities 708 Total finance lease liabilities $ 1,420 Weighted Average Remaining Lease Term Operating leases 9.1 years Finance leases 2.2 years Weighted Average Discount Rate Operating leases 5.72 % Finance leases 4.79 % The cumulative effect of the changes made to the 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 are as follows: Year Ending December 31, Operating Finance 2020 $ 44,454 $ 762 2021 32,264 522 2022 22,602 193 2023 13,033 11 2024 11,166 8 Thereafter 61,506 — Total lease payments 185,025 1,496 Less imputed interest (48,673) (76) Total $ 136,352 $ 1,420 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 Capital 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 |
Long-term Debt and Credit Agree
Long-term Debt and Credit Agreement | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Long-term Debt and Credit Agreement | Long-term Debt and Credit Agreement The Company’s debt at December 31, 2019 consisted of the following: Total term loan outstanding $ — Amounts outstanding under the Revolving Credit Facility 297,000 Total outstanding indebtedness 297,000 Less: amounts expected to be repaid within one year — Total long-term debt due after one year $ 297,000 At December 31, 2019, the Company assessed the amount recorded under the Term Loan (defined below) and the Revolving Credit Facility (defined below) and determined that such amounts approximated fair value. The fair values of the debt are based on quoted inactive market prices and are therefore classified as Level 2 within the valuation hierarchy. Scheduled principal repayments under the Long-term Debt and Credit Agreement subsequent to December 31, 2019 are as follows: 2020 $ — 2021 — 2022 — 2023 297,000 2024 — Thereafter — Total $ 297,000 Credit Agreement On September 30, 2016, in connection with the consummation of the Spin-Off, the Company as the borrower, entered into a Credit Agreement with Bank of America, as administrative agent (the “Original Credit Agreement”). The Original Credit Agreement consisted of a $270 million term loan (the “Original Term Loan”) and a $155 million revolving loan facility (the “Original Revolving Credit Facility”). The Original Revolving Credit Facility included a $25 million letter-of-credit sub-facility and a $20 million Swing-Line Loan sub-facility, issuances against which reduce the available capacity for borrowing. On February 21, 2018 (the “First Amendment Date”), the Company entered into Amendment No. 1 (the “First Amendment”) to the Credit Agreement among the Company, the guarantors, the lenders party thereto and Bank of America, N.A., as administrative agent (the Original Credit Agreement, after giving effect to the First Amendment, the “First Amended and Restated Credit Agreement”). As discussed above, the credit facilities under the Original Credit Agreement consisted of a senior secured term loan in an aggregate principal amount of $270 million, of which $267 million was outstanding just prior to entering into the First Amendment, and a senior secured revolving credit facility in a principal amount of $155 million. Pursuant to the First Amendment, (i) the term loan facility under the Original Credit Agreement was terminated and the entire outstanding balance of the term loan facility (the “Term Loan”) thereunder was paid in full and (ii) the maximum aggregate principal amount of the senior secured revolving credit facility (the “Revolving Credit Facility”) was increased to $425 million. On the First Amendment Date, the Company borrowed $242 million under the Revolving Credit Facility. The proceeds of such loans, as well as cash on hand, were used to repay the outstanding Term Loan under the Original Credit Agreement. The Revolving Credit Facility under the First Amended and Restated Credit Agreement has a 5-year term with a scheduled maturity date of February 21, 2023. The First Amendment resulted in an increase in the Revolving Credit Facility to replace the Term Loan and provided increased borrowing flexibility and reduced overall borrowing costs with an approximate 50 basis point reduction in the interest rate spread. The First Amended and Restated Credit Agreement permits the Company to utilize up to $40 million of the Revolving Credit Facility for the issuance of letters of credit and up to $40 million for swing line loans. The Company has the option to incur incremental term loans and/or increase the amount of the Revolving Credit Facility in an aggregate principal amount for all such incremental term loans and increases of the Revolving Credit Facility of up to the sum of (x) $175 million plus (y) an amount such that the Company’s Consolidated Senior Secured Leverage Ratio (as defined in the First Amended and Restated Credit Agreement) would not be greater than 1.75 to 1.00, in each case, to the extent that any one or more lenders, whether or not currently party to the First Amended and Restated Credit Agreement, commits to be a lender for such amount. Borrowings under the First Amended and Restated Credit Agreement bore interest at a rate equal to either the sum of a base rate plus a margin ranging from 0.50% to 1.50% or the sum of a Eurodollar rate plus a margin ranging from 1.50% to 2.50%, with either such margin varying according to the Company’s Consolidated Leverage Ratio (as defined in the Amended and Restated Credit Agreement). The Company was also required to pay a commitment fee in respect of unused commitments under the Revolving Credit Facility, if any, at a rate ranging from 0.20% to 0.40% per annum depending on the Company’s Consolidated Leverage Ratio. The initial margin under the First Amended and Restated Credit Agreement was 0.75% for base rate loans and 1.75% for Eurodollar rate loans and the initial commitment fee rate was 0.25% per annum. The First Amended and Restated Credit Agreement contained customary covenants limiting the ability of the Company and its subsidiaries to, among other things, pay cash dividends, incur debt or liens, redeem or repurchase stock of the Company, enter into transactions with affiliates, make investments, make capital expenditures, merge or consolidate with others or dispose of assets. The First Amended and Restated Credit Agreement also contained financial covenants that required the Company to maintain a Consolidated Interest Coverage Ratio (as defined in the First Amended and Restated Credit Agreement) of not less than 3.00 to 1.00 and to maintain a Consolidated Leverage Ratio of (i) 3.50 to 1.00 or less for the fiscal quarter ending March 31, 2018, through and including the fiscal quarter ending December 31, 2019, (ii) 3.25 to 1.00 or less for the fiscal quarter ending March 31, 2020, through and including the fiscal quarter ending December 31, 2020, (iii) 3.00 to 1.00 or less for the fiscal quarter ending March 31, 2021, through and including the fiscal quarter ending December 31, 2021, and (iv) 2.75 to 1.00 or less for the fiscal quarter ending March 31, 2022 and each fiscal quarter thereafter (subject to the Company’s option to elect a consolidated leverage ratio increase in connection with certain acquisitions). If the Company did not comply with the covenants in the First Amended and Restated Credit Agreement, the lenders could have, subject to customary cure rights, required the immediate payment of all amounts outstanding under the Revolving Credit Facility. The obligations under the First Amended and Restated Credit Agreement are secured by a pledge of assets and liens on substantially all of the assets of AdvanSix. The Company had approximately $4.2 million of letter of credit agreements outstanding as of December 31, 2019, of which $3.2 million are bi-lateral letters of credit outside the Revolving Credit Facility with $1.0 million outstanding under the Revolving Credit Facility. |
Postretirement Benefit Obligati
Postretirement Benefit Obligations | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Postretirement Benefits Obligations | Postretirement Benefit Obligations Defined Contribution Benefit Plan On January 1, 2017, the Company established a defined contribution plan which covers all eligible U.S. employees. Our plan allows eligible employees to contribute a portion of their cash compensation to the plan on a tax-deferred basis to save for their future retirement needs. The Company matches 50% of the first 8% of contributions for employees covered by a collective bargaining agreement and matches 75% of the first 8% of the employee’s contribution election for all other employees. The plan’s matching contributions vest after three years of service with the Company. The Company may also provide an additional discretionary retirement savings contribution which is at the sole discretion of the Company. The Company made contributions to the defined contribution plan of $5,944, $5,514 and $5,379 for the years ended December 31, 2019, 2018 and 2017, respectively. Defined Benefit Pension Plan Prior to the Spin-Off certain of our employees participated in a defined benefit pension plan (the “Shared Plan”) sponsored by Honeywell which includes participants of other Honeywell subsidiaries and operations. We accounted for our participation in the Shared Plan as a multi-employer benefit plan. Accordingly, we did not record an asset or liability to recognize the funded status of the Shared Plan. The related pension expense was allocated based on annual service cost of active participants and reported within Costs of goods sold and Selling, general and administrative expenses in the Statements of Operations. As of the date of separation from Honeywell, these employees’ entitlement to benefits in Honeywell’s plans was frozen and they will accrue no further benefits in Honeywell’s plans. Honeywell retained the liability for benefits payable to eligible employees, which are based on age, years of service and average pay upon retirement. Upon consummation of the Spin-Off, AdvanSix employees who were participants in a Honeywell defined benefit pension plan became participants in the AdvanSix defined benefit pension plan (“AdvanSix Retirement Earnings Plan”). The AdvanSix Retirement Earnings Plan has the same benefit formula as the Honeywell defined benefit pension plan. Moreover, vesting service, benefit accrual service and compensation credited under the Honeywell defined benefit pension plan apply to the determination of pension benefits under the AdvanSix Retirement Earnings Plan. Benefits earned under the AdvanSix Retirement Earnings Plan shall be reduced by the value of benefits accrued under the Honeywell plans. The following tables summarize the balance sheet impact, including the benefit obligations, assets and funded status associated with the AdvanSix Retirement Earnings Plan. Change in benefit obligation: 2019 2018 2017 Benefit obligation at January 1, $ 48,450 $ 51,018 $ 33,887 Service Cost 6,855 8,008 7,629 Interest Cost 2,084 1,875 1,333 Actuarial losses (gains) 12,364 (12,324) 8,190 Benefits Paid (472) (127) (21) Benefit obligation at December 31, $ 69,281 $ 48,450 $ 51,018 Change in plan assets: Fair value of plan assets at January 1, $ 26,789 $ 17,321 $ — Actual return on plan assets 5,462 (2,205) 592 Benefits paid (472) (127) (21) Company Contributions 4,200 11,800 16,750 Fair value of plan assets at December 31, 35,979 26,789 17,321 Funded status of plan $ 33,302 $ 21,661 $ 33,697 Amounts recognized in Balance Sheet consists of: Accrued pension liabilities-current (1) $ 892 $ 581 $ 301 Accrued pension liabilities-noncurrent (2) 32,410 21,080 33,396 Total pension liabilities recognized $ 33,302 $ 21,661 $ 33,697 (1) Included in accrued liabilities on Balance Sheet (2) Included in postretirement benefit obligations on Balance Sheet Pension amount recognized in accumulated other comprehensive loss (income) associated with the Company's pension plan are as follows for: Years Ended December 31, 2019 2018 2017 Transition obligation $ — $ — $ — Prior service cost — — — Net actuarial (gain) loss 4,012 (4,226) 4,743 Pension amounts recognized in other comprehensive loss (income) $ 4,012 $ (4,226) $ 4,743 The components of net periodic benefit cost and other amounts recognized in other comprehensive income for our pension plan include the following components: Years Ended December 31, 2019 2018 2017 Net periodic pension cost (benefit) Service cost $ 6,855 $ 8,008 $ 7,629 Interest cost 2,084 1,875 1,333 Expected return on plan assets (1,336) (1,151) (302) Recognition of actuarial losses — — — Net periodic Pension Cost 7,603 8,732 8,660 Other changes in benefits obligations recognized in other comprehensive loss (income) Actuarial losses (gains) 8,238 (8,969) 7,902 Total recognized in other comprehensive income 8,238 (8,969) 7,902 Total net periodic pension cost (benefit) recognized in Other comprehensive income $ 15,841 $ (237) $ 16,562 The estimated actuarial loss (gain) that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost in 2019 and 2018 is expected to be nil. Significant actuarial assumptions used in determining the benefit obligations and net periodic benefit cost for our pension plan were as follows: Key actuarial assumptions used to determine benefit obligations at December 31, 2019 2018 2017 Effective discount rate for benefit obligation 3.5% 4.6% 3.9% Expected annual rate of compensation increase 2.4% 2.8% 2.8% Key actuarial assumptions used to determine the net periodic benefit cost for the years ended December 31, 2019 2018 2017 Effective discount rate for service cost 4.6% 3.9% 4.5% Effective discount rate for interest cost 4.3% 3.7% 4.0% Expected long-term rate of return 7.0% 7.0% 5.8% Expected annual rate of compensation increase 2.8% 2.8% 2.8% The discount rate for our pension plan reflects the current rate at which the associated liabilities could be settled at the measurement date of December 31 of a given year. To determine discount rates for our pension plan, we use a modeling process that involves matching the expected cash outflows of our benefit plan to a yield curve constructed from a portfolio of high quality, fixed-income debt instruments. We use the single weighted-average yield of this hypothetical portfolio as a discount rate benchmark. The long-term expected rate of return on funded assets is developed by using forward-looking long-term return assumptions for each asset class. Management incorporates the expected future investment returns on current and planned asset allocations using information from external investment consultants as well as management judgment. A single rate is then calculated as the weighted average of the target asset allocation percentages and the long-term return assumption for each asset class. The accumulated benefit obligation for our pension plan was $54.4 million, $36.7 million and $31.2 million as of December 31, 2019, 2018 and 2017, respectively. Benefit payments, including amounts to be paid from Company assets, and reflecting expected future service, as appropriate, are expected to be paid during the following years: 2020 $ 892 2021 1,461 2022 1,836 2023 2,312 2024 2,805 Thereafter 21,327 Our general funding policy for our pension plan is to contribute amounts at least sufficient to satisfy regulatory funding standards. We plan to make estimated payments through such time as the plan is fully funded. The Company made pension plan contributions sufficient to satisfy pension funding requirements under the AdvanSix Retirement Earnings Plan as follows: Years Ended December 31, 2019 2018 2017 1st Quarter $ — $ 1,950 $ 2,150 2nd Quarter 500 6,600 1,600 3rd Quarter 3,700 3,250 11,050 4th Quarter — — 1,950 Total $ 4,200 $ 11,800 $ 16,750 The Company plans to make pension plan contributions during 2020 sufficient to satisfy pension funding requirements of $5.0 to $10.0 million as well as 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. The target asset allocation percent for the Company's pension plan assets is summarized as follows: Years Ended December 31, 2019 2018 Cash and cash equivalents 2% 2% US and non-US equity securities 65% 65% Fixed income / real estate / other securities 33% 33% Total Pension Assets 100% 100% Fixed income and other securities include investment grade securities covering the Treasury, agency, asset-backed, mortgage-backed and credit sectors of the U.S. Bond Market, as well as listed real estate companies and real estate investment trusts located in both developed and emerging markets. Fair Value at December 31, Fair Value Measurements 2019 2018 2017 Investments valued using NAV per share Emerging Markets Region Equities $ 2,264 $ 1,538 $ 1,090 International Region Equities 6,755 4,535 3,215 United States Equities 15,377 11,071 7,273 United States Bonds 9,477 7,878 4,723 Real Estate 1,767 1,357 872 Cash Fund 339 410 148 Total Pension Plan Assets at Fair Value $ 35,979 $ 26,789 $ 17,321 The pension plan assets are invested in collective investment trust funds as shown above. These investments are measured at fair value using the net asset value per share practical expedient and have not been classified in the fair value hierarchy. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 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 million approximated 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 December 31, 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 December 31, 2019 and 2018 was a loss of approximately $1.7 million and $0.8 million, respectively, and is considered a Level 2 liability. There were no financial or non-financial assets or liabilities which required fair value measurement at December 31, 2017. 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 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 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. |
Derivative and Hedging Instrume
Derivative and Hedging Instruments | 12 Months Ended |
Dec. 31, 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 and 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 with significant concentrations of trade accounts receivable – net at December 31, 2019, it had one customer that 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 December 31, 2019 and 2018, we had no contracts with notional amounts 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") 815, the Company designated the interest rate swaps as cash flow hedges of floating-rate borrowings. These 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 2019 2018 2017 Balance Sheet Classification Fair Value 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 $ (1,718) Accrued liabilities and Other liabilities $ (833) N / A $ — Total Derivatives $ (1,718) $ (833) $ — The following table summarizes adjustments related to cash flow hedge included in “Cash flow hedges”, in the Consolidated Statements of Comprehensive Income: December 31, 2019 Loss on derivative instruments included in Accumulated other comprehensive income at December 31, 2018 $ (833) Fair value adjustment (885) Loss on derivative instruments included in Accumulated other comprehensive income at December 31, 2019 $ (1,718) At December 31, 2019, the Company expects to reclassify approximately $0.8 million of net gains (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. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation 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 Balance Sheets, 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. On March 13, 2018, a federal search warrant was executed at the Company’s Hopewell, Virginia manufacturing facility. On the same date, the Company was separately served with a grand jury subpoena issued by the U.S. District Court for the Eastern District of Virginia, which requested documents related to the Hopewell facility’s air emissions and its compliance with the terms of the previously disclosed 2013 consent decree with the federal government and the Commonwealth of Virginia. The Company was notified during the first quarter of 2019 that the U.S. Attorney’s Office for the Eastern District of Virginia had closed its investigation and no further action by the Company was required. On May 13, 2019, the Company announced that the United States Government notified the Company that the balance of the criminal investigation concluded with no further action required. 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 2020. Unconditional Purchase Obligations: In the normal course of business, the Company makes commitments to purchase goods with various vendors in the normal course of business which are consistent with our expected requirements and primarily relate to cumene, oleum, sulfur and natural gas as well as a long-term agreement for loading, unloading and the handling of a portion of our ammonium sulfate export volumes. Future minimum payments for these unconditional purchase obligations as of December 31, 2019 are as follows (dollars in thousands): Year Amount 2020 $ 80,772 2021 38,465 2022 30,142 2023 14,954 2024 11,707 Thereafter 184,544 $ 360,584 |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2019 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Changes in Accumulated Other Comprehensive Income (Loss) | Changes in Accumulated Other Comprehensive Income (Loss) The components of accumulated other comprehensive income (loss) are as follows: Currency Translation Adjustment Postretirement Benefit Obligations Adjustment Changes in Fair Value of Effective Cash Flow Hedges Accumulated Other Comprehensive Income (loss) Balance at December 31, 2016 $ (4,998) $ 1,963 $ — $ (3,035) Other comprehensive income (loss) 12 (7,902) — (7,890) Amounts reclassified from accumulated other comprehensive income (loss) — — — — Income tax expense (benefit) — 1,879 — 1,879 Current period change 12 (6,023) — (6,011) Balance at December 31, 2017 (4,986) (4,060) — (9,046) Other comprehensive income (loss) (25) 8,969 (833) 8,111 Amounts reclassified from accumulated other comprehensive income (loss) — 410 — 410 Income tax expense (benefit) — (2,149) 200 (1,949) Current period change (25) 7,230 (633) 6,572 Balance at December 31, 2018 (5,011) 3,170 (633) (2,474) Other comprehensive income (loss) (9) (8,238) (1,589) (9,836) Amounts reclassified from accumulated other comprehensive income (loss) — — 705 705 Income tax expense (benefit) — 1,943 211 2,154 Current period change (9) (6,295) (673) (6,977) Balance at December 31, 2019 $ (5,020) $ (3,125) $ (1,306) $ (9,451) |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The details of the earnings per share calculations for the years ended December 31, 2019, 2018 and 2017 are as follows: Years Ended December 31, 2019 2018 2017 Basic Net Income $ 41,347 $ 66,244 $ 146,699 Weighted average common shares outstanding 28,122,288 30,172,050 30,482,966 EPS – Basic $ 1.47 $ 2.20 $ 4.81 Years Ended December 31, 2019 2018 2017 Diluted Net Income $ 41,347 $ 66,244 $ 146,699 Weighted average common shares outstanding – Basic 28,122,288 30,172,050 30,482,966 Dilutive effect of unvested equity awards 776,548 806,241 608,635 Weighted average common shares outstanding – Diluted 28,898,836 30,978,291 31,091,601 EPS – Diluted $ 1.43 $ 2.14 $ 4.72 Diluted EPS is computed based upon the weighted average number of common shares outstanding for the year plus the dilutive effect of common stock equivalents 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. For the years ended December 31, 2019, 2018 and 2017, stock options of 544,635, 349,312 and nil, respectively, were anti-dilutive and excluded from the computations of dilutive EPS. In September 2017, the Board of Directors (the "Board") adopted the AdvanSix Inc. Deferred Compensation Plan (the “DCP”), effective January 1, 2018. Pursuant to the DCP, our directors may elect to defer their cash retainer fees and allocate their deferrals to the AdvanSix stock unit fund. Each unit allocated under the stock unit fund represents the economic equivalent of one share of common stock. Units are paid out in shares of AdvanSix common stock upon distribution. As of December 31, 2019, a total of 29,106 units were allocated to the AdvanSix stock unit fund under the DCP. On May 4, 2018, the Company announced that 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 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. During 2019, the Company repurchased 1,898,013 shares of common stock under the share repurchase program and 400,394 shares of common stock covering the tax withholding obligations in connection with the vesting of equity awards for a total of $62.2 million at a weighted average market price of $27.04 per share. The purchase of shares reduces the weighted average number of shares outstanding in the basic and diluted earnings per share calculations. |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation Plans | Stock-Based Compensation Plans On September 8, 2016, prior to the Spin-Off, our Board adopted, and Honeywell, as our sole stockholder, approved, the 2016 Stock Incentive Plan of AdvanSix Inc. (the “Equity Plan”). Following the Spin-Off, the material terms of performance-based compensation under the Equity Plan were approved by the Company's stockholders for tax purposes at our 2017 annual meeting of stockholders. The Equity Plan provides for the grant of stock options, stock appreciation rights, performance awards, restricted stock units, restricted stock, other stock-based awards and non-share-based awards. The maximum aggregate number of shares of our common stock that may be issued under all stock-based awards granted under the Equity Plan is 3,350,000. Of those shares, only 1,750,000 may be subject, on a one-for-one basis, to awards granted under the Equity Plan that are not stock options or stock appreciation rights (“full-value awards”). After the number of shares subject to full-value awards exceed such limit, each share subject to future full-value awards would reduce the number of shares available for grant under the Equity Plan by four shares, with the exception of awards to non-employee directors, which shall not count towards such limit and shares related to such awards shall always be counted on a one-for-one basis. Under the terms of the Equity Plan, there were 1,438,519 shares of AdvanSix common stock available for future grants of full-value awards, of which 328,799 were available for awards other than full-value awards on a one-for-one basis, at December 31, 2019. Restricted Stock Units – The Company granted RSUs to key management employees and directors that generally vest over periods ranging from 1 to 3 years. Upon vesting, the RSUs entitle the holder to receive one share of AdvanSix common stock for each RSU at time of vesting and are payable in AdvanSix common stock upon vesting. The fair value of all stock-settled RSUs is based upon the market price of the underlying common stock as of the grant date. The following table summarizes information about RSU activity related to the Equity Plan: Number of Restricted Stock Units (In Thousands) Weighted Average Grant Date Fair Value (Per Share) Non-vested at December 31, 2016 908 $ 16.41 Granted 98 27.43 Vested — — Forfeited (2) 27.73 Non-vested at December 31, 2017 1,004 17.46 Granted 65 41.58 Vested (73) 19.31 Forfeited (2) 32.59 Non-vested at December 31, 2018 994 18.90 Granted 131 29.42 Vested (864) 16.78 Forfeited (7) 32.93 Non-vested at December 31, 2019 254 $ 30.97 As of December 31, 2019, there was approximately $3.6 million of total unrecognized compensation cost related to non-vested RSUs granted under the Equity Plan which is expected to be recognized over a weighted-average period of 0.33 years. The following table summarizes information about the income statement impact from RSUs for the years ended December 31, 2019, 2018 and 2017: Years Ended December 31, 2019 2018 2017 Compensation expense $ 6,125 $ 6,606 $ 6,141 Future income tax benefit recognized $ 678 $ 1,262 $ 755 Stock Options – The exercise price, term and other conditions applicable to each option granted under the Equity Plan are generally determined by the Compensation Committee of the Board. The exercise price of stock options is set on the grant date and may not be less than the fair market value per share of our stock on that date. The fair value is recognized as an expense over the employee’s requisite service period (generally the vesting period of the award). Options generally vest over periods ranging from 1 to 3 years. The following table summarizes information about the income statement impact from stock options for the years ended December 31, 2019, 2018 and 2017. Years Ended December 31, 2019 2018 2017 Compensation expense $ 1,989 $ 1,470 $ 969 Future income tax benefit recognized $ 745 $ 466 $ 230 The fair value related to stock options granted was determined using Black-Scholes option pricing model and the weighted average assumptions are shown in the table below: Years Ended December 31, Key Black-Scholes Assumptions 2019 2018 2017 Risk-free interest rate 2.5% 2.7% 2.2% Expected term (years) 6 6 6 Volatility 30.9% 29.7% 37.0% Dividend yield — — — Fair value per stock option $11.67 $14.44 $10.48 The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing model. Volatility is determined based on the average volatility of peer companies with similar option terms. The expected term is determined using a simplified approach, calculated as the mid-point between the vesting period and the contractual term of the award. The risk-free interest rate is determined based upon the yield of an outstanding U.S. Treasury note with a term equal to the expected term of the option granted. The following table summarizes information about stock option activity related to the Equity Plan: Number of Shares Weighted Average Exercise Price (Per Share) Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding at December 31, 2016 — $ — — Granted 175 26.66 Exercised — — Forfeited (3) 26.66 Expired — — Outstanding at December 31, 2017 172 26.66 9.31 $ 2,651 Exercisable at December 31, 2017 — $ — — $ — Granted 129 41.97 Exercised — — Forfeited (3) 33.64 Expired — — Outstanding at December 31, 2018 298 33.24 8.80 $ — Exercisable at December 31, 2018 57 $ 33.23 8.30 $ — Granted 196 33.34 Exercised 1 26.66 Forfeited (4) 31.75 Expired — — Outstanding at December 31, 2019 491 33.28 8.22 $ — Exercisable at December 31, 2019 156 $ 30.83 7.45 The aggregate intrinsic values in the table above represent the total pre-tax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the year and the exercise price, multiplied by the number of in-the-money options) that would have been received had all option holders exercised their in-the-money options at year-end. The amount changes based on the fair market value of the Company’s stock. As of December 31, 2019, there was $1.4 million of unrecognized stock-based compensation expense related to stock options that is expected to be recognized over a weighted average period of approximately 0.9 years. Performance Stock Units – The Company has issued PSUs to key senior management employees which, upon vesting, convert one-for-one to AdvanSix common stock. The actual number of shares an employee receives for each PSU depends on the Company’s performance against cumulative Earnings Per Share and average annual Return on Investment goals over three The following table summarizes information about PSU activity related to the Equity Plan: Number of Performance Stock Units (In Thousands) Weighted Average Grant Date Fair Value Non-vested at December 31, 2016 — $ — Granted 90 26.66 Vested — — Forfeited (1) 26.66 Non-vested at December 31, 2017 89 26.66 Granted 58 41.97 Vested — — Forfeited (2) 31.68 Non-vested at December 31, 2018 145 32.73 Granted 88 33.34 Vested — — Forfeited (3) 35.04 Non-vested at December 31, 2019 230 30.03 The fair value of the PSUs is based on the fair market value of the Company’s stock at the grant date. The number of underlying shares to be issued will be based on actual performance achievement over the performance period. The fair value of each PSU grant is amortized monthly into compensation expense on a straight-line basis over a vesting period of 36 months. The accrual of compensation costs is based on our estimate of the final expected value of the award and is adjusted as required for the performance-based condition. The Company assumes that forfeitures will be minimal, and estimates forfeitures at time of issuance, which results in a reduction in compensation expense. As the payout of PSUs includes dividend equivalents, no separate dividend yield assumption is required in calculating the fair value of the PSUs. The Company currently does not pay dividends. As of December 31, 2019, there was approximately $2.1 million of total unrecognized compensation cost related to non-vested PSUs granted under the Equity Plan which is expected to be recognized over a weighted-average period of 0.9 years. The following table summarizes information about the income statement impact from PSUs for the year ended December 31, 2019, 2018 and 2017. Years Ended December 31, 2019 2018 2017 Compensation expense $ 236 $ 2,057 $ 632 Future income tax benefit recognized $ 271 $ 252 $ 66 |
Unaudited Selected Quarterly Fi
Unaudited Selected Quarterly Financial Data | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Unaudited Selected Quarterly Financial Data | Unaudited Selected Quarterly Financial Data The following tables show selected unaudited quarterly results of operations for 2019 and 2018. The quarterly data has been prepared on the same basis as the audited annual financial statements and include all adjustments, which include only normal recurring adjustments, necessary for the fair statement of our results of operations for these periods. 2019 March 31, June 30, September 30, December 31, Year Ended Net Sales $ 314,895 $ 345,215 $ 310,633 $ 326,650 $ 1,297,393 Gross Profit 48,015 42,087 30,510 14,860 135,472 Net Income 20,174 15,346 7,921 (2,094) 41,347 Earnings per share – basic (1) 0.70 0.54 0.29 (0.08) 1.47 Earnings per share – diluted (1) 0.68 0.53 0.28 (0.08) 1.43 2018 March 31, June 30, September 30, December 31, Year Ended Net Sales $ 359,238 $ 400,459 $ 368,653 $ 386,634 $ 1,514,984 Gross Profit 37,918 57,501 25,219 53,849 174,487 Net Income 11,593 28,410 5,480 20,761 66,244 Earnings per share – basic (1) 0.38 0.93 0.18 0.70 2.20 Earnings per share – diluted (1) 0.37 0.91 0.18 0.68 2.14 (1) Total for the full year may differ from the sum of the individual quarters due to the requirement to use weighted average shares each quarter which may fluctuate with share repurchases and share issuances. |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 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 Consolidated Statements of Operations. The Company recorded a restructuring charge of $11.0 million during 2019 and does not expect to incur any additional restructuring charges related to the closure of its films plant. Restructuring costs for the year ended December 31, 2019 were as follows: Year ended December 31, 2019 Write-off of equipment and facility $ 7,164 Facility exit costs 1,326 Employee separations 1,491 Inventory write-downs 1,039 Total restructuring charges $ 11,020 The following table summarizes the components of restructuring activities and the remaining balances of accrued restructuring charges as of December 31, 2019: Employee Separation Benefits Facility Exit Costs Total Accrual balance at December 31, 2018 $ — $ — $ — Charges 1,491 1,326 2,817 Cash payments (1,364) (916) (2,280) Accrual balance at December 31, 2019 $ 127 $ 410 $ 537 The balance of accrued restructuring charges is expected to be settled within the next twelve months. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On February 19, 2020, the Company entered into Amendment No. 2 (the “Second Amendment”) to the First Amended and Restated Credit Agreement (the First Amended and Restated Credit Agreement, after giving effect to the Second Amendment, the “Second Amended and Restated Credit Agreement”). The Second Amendment amends the consolidated leverage ratio financial covenant of the First Amended and Restated Credit Agreement and requires the Company to maintain a Consolidated Leverage Ratio (as defined in the Second Amended and Restated Credit Agreement) of (i) 3.50 to 1.00 or less for the fiscal quarter ending March 31, 2020, (ii) 4.50 to 1.00 or less for the fiscal quarter ending June 30, 2020, (iii) 4.25 to 1.00 or less for the fiscal quarter ending September 30, 2020, (iv) 3.50 to 1.00 or less for the fiscal quarter ending December 31, 2020, (v) 3.25 to 1.00 or less for the fiscal quarter ending March 31, 2021 through and including the fiscal quarter ending December 31, 2021, and (vi) 3.00 to 1.00 or less for the fiscal quarter ending March 31, 2022 and each fiscal quarter thereafter (subject to the Company’s option to elect a consolidated leverage ratio increase in connection with certain acquisitions). The consolidated interest coverage ratio financial covenant of the First Amended and Restated Credit Agreement was not changed and continues to require the Company to maintain a Consolidated Interest Coverage Ratio (as defined in the Second Amended and Restated Credit Agreement) of not less than 3.00 to 1.00. If the Company does not comply with the covenants in the Second Amended and Restated Credit Agreement, the lenders may, subject to customary cure rights, require the immediate payment of all amounts outstanding under the Revolving Credit Facility. Borrowings under the Second Amended and Restated Credit Agreement bear interest at a rate equal to either the sum of a base rate plus a margin ranging from 0.50% to 2.00% or the sum of a Eurodollar rate plus a margin ranging from 1.50% to 3.00%, with either such margin varying according to the Company’s Consolidated Leverage Ratio (as defined in the Second Amended and Restated Credit Agreement). The Company is also required to pay a commitment fee in respect of unused commitments under the credit facility, if any, at a rate ranging from 0.20% to 0.50% per annum depending on the Company’s Consolidated Leverage Ratio. Based on 2019 year-end results, the applicable margin under the Second Amended and Restated Credit Agreement is expected to be 1.25% for base rate loans and 2.25% for Eurodollar rate loans and the applicable commitment fee rate is expected to be 0.35% per annum. In addition, the Second Amendment also amended certain administrative provisions associated with the LIBOR Successor Rate (as defined in the Second Amended and Restated Credit Agreement). |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Accounting Principles | Accounting Principles – The financial statements and accompanying Notes are prepared in accordance with accounting principles generally accepted in the United States of America. The following is a description of AdvanSix’s significant accounting policies. |
Principles of Consolidation | Principles of Consolidation – The Consolidated Financial Statements include the accounts of AdvanSix and all of its subsidiaries in which a controlling financial interest is maintained. Our consolidation policy requires equity investments that we exercise significant influence over but do not control the investee and are not the primary beneficiary of the investee’s activities to be accounted for using the equity method. Investments through which we are not able to exercise significant influence over the investee and which we do not have readily determinable fair values are accounted for under the cost method. All intercompany transactions and balances are eliminated in consolidation. |
Cash and Cash Equivalents | Cash and Cash Equivalents – Cash and cash equivalents include cash on hand and on deposit and highly liquid, temporary cash investments with an original maturity to the Company of three months or less. We reduce cash and extinguish liabilities when the creditor receives our payment and we are relieved of our obligation for the liability when checks clear the Company’s bank account. |
Fair Value Measurement | Fair Value Measurement – ASC 820, Fair Value Measurement defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Financial Accounting Standards Board's ("FASB") guidance classifies the inputs used to measure fair value into the following hierarchy: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities Level 2 Unadjusted quoted prices in active markets for similar assets or liabilities, or Unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or Inputs other than quoted prices that are observable for the asset or liability Level 3 Unobservable inputs for the asset or liability |
Derivative Financial Instruments | Derivative Financial Instruments – We minimize our risks from interest and foreign currency exchange rate fluctuations through our normal operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. Derivative financial instruments are used to manage risk and are not used for trading or other speculative purposes. Derivative financial instruments that qualify for hedge accounting must be designated and effective as a hedge of the identified risk exposure at the inception of the contract. Accordingly, changes in fair value of the derivative contract must be highly correlated with changes in fair value of the underlying hedged item at inception of the hedge and over the life of the hedge contract. All derivatives are recorded on the balance sheet as assets or liabilities and measured at fair value. For derivatives designated as hedges of the fair value of assets or liabilities, the changes in fair values of both the derivatives and the hedged items are recorded in current earnings. For derivatives designated as cash flow hedges, the changes in fair value of the derivatives are recorded in Accumulated other comprehensive income (loss) and subsequently recognized in earnings when the hedged items impact earnings. Cash flows of such derivative financial instruments are classified consistent with the underlying hedged item. For derivative instruments that are designated and qualify as a net investment hedge, the derivative’s gain or loss is reported as a component of Other comprehensive income (loss) and recorded in Accumulated other comprehensive income (loss). The gain or loss will be subsequently reclassified into net earnings when the hedged net investment is either sold or substantially liquidated. |
Commodity Price Risk Management | Commodity Price Risk Management – The Company's exposure to market risk for commodity prices can result in changes in our 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 they do not include take-or-pay terms. Instead, each customer agreement, the majority of which have a term of at least one year, is typically determined by monthly or quarterly volume estimates. 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. |
Inventories | Inventories – Substantially all of the Company's inventories are valued at the lower of cost or market using the last-in, first-out (“LIFO”) method. The Company includes spare and other parts in inventory which are used in support of production or production facilities operations and are valued based on weighted average cost. |
Property, Plant and Equipment | Property, Plant, Equipment – Property, plant, equipment asset values are recorded at cost, including any asset retirement obligations, less accumulated depreciation. For financial reporting, the straight-line method of depreciation is used over the estimated useful lives of 30 to 50 years for buildings and improvements and 5 to 40 years for machinery and equipment. Our machinery and equipment includes (1) assets used in short production cycles or subject to high corrosion, such as instrumentation, controls and insulation systems with useful lives up to 15 years, (2) standard plant assets, such as boilers and railcars, with useful lives ranging from 15 to 30 years and (3) major process equipment that can be used for long durations with effective preventative maintenance and repair, such as cooling towers, compressors, tanks and turbines with useful lives ranging from 5 to 40 years. Recognition of the fair value of obligations associated with the retirement of tangible long-lived assets is required when there is a legal obligation to incur such costs. Upon initial recognition of a liability, the cost is capitalized as part of the related long-lived asset and depreciated over the corresponding asset’s useful life. |
Long-Lived Assets | Long-Lived Assets – The Company evaluates the recoverability of the carrying amount of long-lived assets (including property, plant and equipment and intangible assets with determinable lives) whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. The Company evaluates events or changes in circumstances based on several factors including operating results, business plans and forecasts, general and industry trends, and economic projections and anticipated cash flows. An impairment is assessed when the undiscounted expected future cash flows derived from an asset are less than its carrying amount. Impairment losses are measured as the amount by which the carrying value of an asset exceeds its fair value and are recognized in the Consolidated Statements of Operations. The Company also evaluates the estimated useful lives of long-lived assets if circumstances warrant and revises such estimates based on current events. |
Goodwill | Goodwill – The Company had goodwill of $15.0 million as of December 31, 2019 and 2018. Goodwill is subject to impairment testing annually as of March 31, or whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. The Company first assesses qualitative factors as described in ASC 350 to determine whether it is necessary to perform the quantitative goodwill impairment test. The Company completed its annual goodwill impairment test as of March 31, 2019 and, based on the results of the Company's assessment of qualitative factors, it was determined that it was not necessary to perform the quantitative goodwill impairment test. |
Revenue Recognition | Revenue Recognition – The Company recognizes revenue upon the transfer of control of goods or services to customers at amounts that reflect the consideration expected to be received. AdvanSix primarily recognizes revenues when title and control of the product transfers from the Company to the customer. Outbound shipping costs incurred by the Company are not included in revenues but are reflected as freight expense in Costs of goods sold in the Consolidated Statements of Operations. Sales of our products to customers are made under a purchase order, and in certain cases in accordance with the terms of a master services agreement. These agreements typically contain formula-based pass-through pricing tied to key feedstock materials and volume ranges, but often do not specify the goods, including the quantities thereof, to be transferred. Certain master services agreements (including with respect to our largest customer) may contain minimum purchase volumes which can be satisfied by the customer on a periodic basis by choosing from various products offered by the Company. In these cases, a performance obligation is created when a customer submits a purchase order for a specific product at a specified price, typically providing for delivery within the next 60 days. Management considers the performance obligation with respect to such purchase order satisfied at the point in time when control of the product is transferred to the customer, which is indicated by shipment of the product and transfer of title and risk of loss to the customer. Transfer of control to the customer occurs through various modes of shipment, including trucks, railcars, and vessels, and follows a variety of commercially acceptable shipping or destination point terms pursuant to the arrangement with the customer. Variable consideration is estimated for future volume rebates and early pay discounts on certain products and product returns. The Company records variable consideration as an adjustment to the sale transaction price. Since variable consideration is generally settled within one year, the time value of money is not significant. The Company applies the practical expedient in Topic 606 and does not include disclosures regarding remaining performance obligations that have original expected durations of one year or less, or amounts for variable consideration allocated to wholly-unsatisfied performance obligations or wholly-unsatisfied distinct goods that form part of a single performance obligation, if any. The Company also utilizes the practical expedient in Topic 606 and does not include an adjustment for the effects of a significant financing component given the expected period duration of one year or less. |
Environmental | Environmental – AdvanSix accrues costs related to environmental matters when it is probable that we have incurred a liability related to a contaminated site and the amount can be reasonably estimated. |
Deferred Income and Customer Advances | Deferred Income and Customer Advances – AdvanSix has an annual pre-buy program for ammonium sulfate that is classified as deferred income and customer advances in the Consolidated Balance Sheets. Customers pay cash in advance to reserve capacity for ammonium sulfate to guarantee product availability during peak planting season. The Company recognizes a customer advance when cash is received for the advanced buy. Revenue is then recognized and the customer advance is relieved upon title transfer of ammonium sulfate. |
Trade Receivables and Allowance for Doubtful Accounts | Trade Receivables and Allowance for Doubtful Accounts – Trade accounts receivables are recorded at the invoiced amount as a result of transactions with customers. AdvanSix maintains allowances for doubtful accounts for estimated losses based on a customer’s inability to make required payments. AdvanSix estimates anticipated losses from doubtful accounts based on days past due, as measured from the contractual due date and historical collection history and incorporates changes in economic conditions that may not be reflected in historical trends such as customers in bankruptcy, liquidation or reorganization. Receivables are written-off against the allowance for doubtful accounts when they are determined uncollectible. Such determination includes analysis and consideration of the particular conditions of the account, including time intervals since last collection, customer performance against agreed upon payment plans, success of outside collection agencies activity, solvency of customer and any bankruptcy proceedings. |
Research and Development | Research and Development – AdvanSix conducts research and development (“R&D”) activities, which consist primarily of the development of new products and product applications consisting primarily of labor costs and depreciation and maintenance costs. R&D costs are charged to expense as incurred. |
Debt Issuance Costs | Debt Issuance Costs – Debt issuance costs are capitalized as a component of Other assets and are amortized through interest expense over the related term. |
Stock-Based Compensation Plans | Stock-Based Compensation Plans – The principal awards issued under our stock-based compensation plans, which are described in "Note 16. Stock-Based Compensation Plans", are non-qualified stock options, performance share units and restricted stock units. The cost for such awards is measured at the grant date based on the fair value of the award. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods (generally the vesting period of the equity award) and is included in selling, general and administrative expenses. Forfeitures are estimated at the time of grant to recognize expense for those awards that are expected to vest and are based on our historical forfeiture rates. |
Pension Benefits | Pension Benefits – We have a defined benefit plan covering certain employees primarily in the U.S. The benefits are accrued over the employees’ service periods. We use actuarial methods and assumptions in the valuation of defined benefit obligations and the determination of net periodic pension income or expense. Differences between actual and expected results or changes in the value of defined benefit obligations and fair value of plan assets, if any, are not recognized in earnings as they occur but rather systematically over subsequent periods when net actuarial gains or losses are in excess of 10% of the greater of the fair value of plan assets or the plan’s projected benefit obligation. |
Foreign Currency Translation | Foreign Currency Translation – Assets and liabilities of subsidiaries operating outside the United States with a functional currency other than U.S. dollars are translated into U.S. dollars using year-end exchange rates. Sales, costs and expenses are translated at the average exchange rates in effect during the year. Foreign currency translation gains and losses are included as a component of Accumulated other comprehensive income (loss) in our Consolidated Balance Sheets. |
Income Taxes | Income Taxes – We account for income taxes pursuant to the asset and liability method which requires us to recognize current tax liabilities or receivables for the amount of taxes we estimate are payable or refundable for the current year and deferred tax assets and liabilities for the expected future tax consequences attributable to temporary differences between the financial statement carrying amounts and their respective tax bases of assets and liabilities and the expected benefits of net operating loss and credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period enacted. A valuation allowance is provided when it is more likely than not that a portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income and the reversal of deferred tax liabilities during the period in which related temporary differences become deductible. We adopted the provisions of ASC 740 related to the accounting for uncertainty in income taxes recognized in an enterprise’s consolidated financial statements. ASC 740 prescribes a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be taken in income tax returns. The benefit of tax positions taken or expected to be taken in our income tax returns are recognized in the financial statements if such positions are more likely than not of being sustained upon examination by taxing authorities. Differences between tax positions taken or expected to be taken in a tax return and the benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits”. A liability is recognized (or amount of net operating loss carryover or amount of tax refundable is reduced) for an unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC 740. Interest costs and related penalties related to unrecognized tax benefits are required to be calculated, if applicable. Our policy is to classify tax related interest and penalties, if any, as a component of income tax expense. No interest or penalties related to unrecognized income tax benefits were recorded during the years ended December 31, 2019, 2018 and 2017. As of December 31, 2019 and 2018, no liability for unrecognized tax benefits was required to be reported. We do not expect any significant changes in our unrecognized tax benefits in the next year. On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 ("SAB 118") to address the application of US GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the 2017 Act. SAB 118 provides guidance for registrants under three scenarios where the measurement of certain tax items is either complete, can be reasonably estimated or cannot be reasonably estimated. The Company has completed its evaluation of the 2017 Act and the impacts of those items have been reflected in our Consolidated Financial Statements as of December 31, 2018 and 2017. The impacts of those changes are disclosed in “Note 4. Income Taxes”. |
Leases | Leases – The Company enters into agreements to lease transportation equipment, storage facilities, office space, dock access and other equipment. Operating leases have initial terms of up to 20 years with some containing renewal options subject to customary conditions. An arrangement is considered to be a lease if the agreement conveys the right to control the use of the identified asset in exchange for consideration. Operating leases, which are reported as Operating lease right-of-use assets, and Operating lease liabilities – short-term and Operating lease liabilities – long-term are included in our Consolidated Balance Sheets. Finance leases are included as a component of Property, plant and equipment – net, Accounts payable and Other liabilities in our Consolidated Balance Sheets. The Company has elected the following practical expedients available in Topic 842: • the package of three expedients which allows the Company to not 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 Consolidated Balance Sheets; • the bifurcation of lease and non-lease components practical expedients, which did not require the Company to bifurcate lease and non-lease components for 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. |
Earnings Per Share | Earnings Per Share – Basic earnings per share is based on the weighted average number of common shares outstanding. Diluted earnings per share is based on the weighted average number of common shares outstanding and all dilutive potential common shares outstanding. |
Treasury Stock | Treasury Stock – The Company has elected to account for treasury stock purchased under the constructive retirement method. For shares repurchased in excess of par, the company will allocate the excess value to additional paid-in capital. |
Use of Estimates | Use of Estimates – The preparation of the Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the Consolidated Financial Statements and related disclosures in the accompanying Notes. Actual results could differ from those estimates. |
Reclassifications | Reclassifications – Certain prior period amounts have been reclassified for consistency with the current period presentation. All reclassified amounts have been immaterial. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements – The Company considers the applicability and impact of all Accounting Standards Updates (“ASU’s”) issued by the FASB. ASU’s not discussed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Consolidated Financial Statements. On December 18, 2019, the FASB issued ASU No. 2019-12 , Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The ASU removes the exception to the general principles in ASC 740, Income Taxes, associated with the incremental approach for intra-period tax allocation, accounting for basis differences when there are ownership changes in foreign investments and interim-period income tax accounting for year-to-date losses that exceed anticipated losses. In addition, the ASU improves the application of income tax related guidance and simplifies U.S. GAAP when accounting for franchise taxes that are partially based on income, transactions with government resulting in a step-up in tax basis goodwill, separate financial statements of legal entities not subject to tax, and enacted changes in tax laws in interim periods. Different transition approaches, retrospective, modified retrospective, or prospective, will apply to each income tax simplification provision. The guidance is effective for calendar-year public business entities in 2021 and interim periods within that year, and early adoption is permitted. The Company is still evaluating these changes and does not anticipate any material impact on the Company’s consolidated financial position or results of operations upon adoption. 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 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, that allows companies to reclassify to Retained earnings the stranded tax effects in Accumulated other comprehensive income resulting from the Tax Cuts and Jobs Act. The amendments in ASU 2018-02 are effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption of the amendments in this update is permitted, including adoption in any interim period. The Company elected to early adopt this guidance effective January 1, 2018 and to reclassify the stranded tax effects from the Tax Cuts and Jobs Act from Accumulated other comprehensive income to Retained earnings (refer to "Note 4. Income Taxes"). In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities which simplifies financial statement reporting for qualifying hedging relationships by eliminating the requirement to separately measure and report hedge ineffectiveness. For net investment hedges, the entire change in fair value of the hedging instruments is recorded in the currency translation adjustment section of other comprehensive income or loss. Pursuant to the amendments, these amounts are required to be subsequently reclassified to earnings in the same income statement line item in which the earnings effect of the hedged item is presented when the hedged item affects earnings. The amendments of ASU No. 2017-12 are effective for the Company’s fiscal years beginning after December 31, 2018, including interim periods within that fiscal year. Early adoption of these amendments is permitted, including in any interim period. The Company elected to early adopt the guidance in the period ended December 31, 2018. In March 2017, the FASB issued ASU 2017-07, Compensation – Retirement Benefits (Topic 715) in order to improve the presentation of net periodic pension and postretirement costs. The amendment requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost as defined in paragraphs 715-30-35-4 and 715-60-35-9 are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. The amendments in this ASU also allow only the service cost component to be eligible for capitalization when applicable. The amendments in this update related to income statement activity were applied retrospectively whereas balance sheet activity was applied prospectively. For public business entities, the effective date for ASU 2017-07 was annual periods beginning after December 15, 2017, including interim periods within those annual periods. Early adoption is permitted within the first interim period. The Company adopted this guidance effective January 1, 2018 and there was no impact on the Company’s consolidated financial position and results of operations upon adoption other than immaterial pension expense reclassifications in the 2017 and 2016 Consolidated Statements of Operations which reduced Cost of goods sold and Selling, general and administrative expenses and increased Other non-operating expense (income), net. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments which clarifies how entities should classify certain cash receipts and cash payments on the statement of cash flows. The amended guidance addresses eight specific cash flow issues, including debt prepayment or extinguishment costs, and clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. Entities are required to apply the guidance retrospectively and provide the relevant disclosure in ASC 250. For public business entities, the effective date for ASU 2017-07 was annual periods beginning after December 15, 2017, including interim periods within those annual periods. Early adoption is permitted. The Company adopted this guidance effective January 1, 2018 and there was no impact on the Company’s consolidated financial position, results of operations or cash flows upon adoption on the 2018 Consolidated Statement of Cash Flows. 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 to not 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 Consolidated Balance Sheets; • 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 Consolidated Balance Sheet but did not have a significant impact in the recognition, measurement or presentation of lease expenses within the Consolidated Statements of Operations or the 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. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) , which replaced the existing accounting standards for revenue recognition with a single comprehensive five-step model eliminating industry-specific accounting rules. The core principle is to recognize revenue upon the transfer of goods or services to customers at an amount that reflects the consideration expected to be received. The provisions of ASU 2014-09 became effective for public business entities for interim and annual periods beginning after December 15, 2017. The Company adopted this standard effective January 1, 2018 using the modified retrospective method of transition. Under this standard, revenue recognition from the Company's products remained unchanged from the Company's previous revenue recognition model causing no cumulative impact adjustment on the Company’s consolidated financial position and results of operations. |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 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 2019, 2018 and 2017: Years Ended December 31, 2019 2018 2017 Nylon 27% 28% 29% Caprolactam 22% 19% 19% Ammonium Sulfate Fertilizer 23% 20% 19% Chemical Intermediates 28% 33% 33% 100% 100% 100% The Company’s revenues by geographic area for 2019, 2018 and 2017 were as follows (in millions): Years Ended December 31, 2019 2018 2017 United States $ 1,057 $ 1,271 $ 1,189 International 240 244 286 Total $ 1,297 $ 1,515 $ 1,475 |
Contract with Customer, Asset and Liability | Below is a roll-forward of Deferred income and customer advances for the twelve months ended December 31, 2019: Deferred Income and Customer Advances 2019 Opening balance January 1, 2019 $ 22,556 Additional cash advances 19,517 Less amounts recognized in revenues (22,377) Ending balance December 31, 2019 $ 19,696 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | Years Ended December 31, 2019 2018 2017 Income (loss) before taxes U.S. $ 53,231 $ 85,596 $ 144,499 Non-U.S. 117 172 133 $ 53,348 $ 85,768 $ 144,632 |
Schedule of Components of Income Tax Expense (Benefit) | Income tax expense (benefit) consists of: Years Ended December 31, 2019 2018 2017 Current Provision: Federal $ 2,519 $ 7,529 $ 3,682 State 1,007 2,442 1,743 Non-U.S. 24 27 22 Total current provision $ 3,550 $ 9,998 $ 5,447 Deferred Provision: Federal $ 7,536 $ 8,081 $ (6,824) State 907 1,435 (700) Non-U.S. 8 10 10 Total deferred provision 8,451 9,526 (7,514) Total income tax expense (benefit) $ 12,001 $ 19,524 $ (2,067) |
Schedule of Effective Income Tax Rate Reconciliation | The U.S. federal statutory income tax rate is reconciled to the effective income tax rate as follows: Years Ended December 31, 2019 2018 2017 U.S. federal statutory income tax rate 21.0 % 21.0 % 35.0 % 2017 Act — % (1.9) % (37.6) % U.S. state income taxes 2.8 % 3.5 % 2.6 % U.S. state income tax rate change — % — % (1.7) % Manufacturing incentives — % — % (0.3) % Executive compensation limitations 1.5 % 1.2 % 0.7 % Tax credits (3.0) % (0.5) % — % Other, net 0.2 % (0.5) % (0.1) % 22.5 % 22.8 % (1.4) % |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of temporary differences which give rise to future income tax benefits and expenses are as follows: December 31, 2019 2018 Deferred tax assets: Net Operating Loss $ 8,167 $ 27 Accruals and Reserves 2,859 4,158 Interest Expense Limitation 2,655 — Pension Obligation 7,318 4,804 Equity Compensation 1,695 1,979 Other 1,314 289 Total gross deferred tax assets 24,008 11,257 Less: Valuation Allowance — — Total deferred tax assets $ 24,008 $ 11,257 Deferred tax liabilities: Property, plant & equipment $ (123,915) $ (102,783) Intangibles (3,713) (3,280) Inventory (5,503) (8,252) Other (931) (698) Total deferred tax liabilities (134,062) (115,013) Net deferred taxes $ (110,054) $ (103,756) |
Accounts and Other Receivable_2
Accounts and Other Receivables - Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Schedule of Accounts, Notes, Loans and Financing Receivable | December 31, 2019 2018 Accounts receivables $ 105,275 $ 166,017 Other 3,708 1,716 Total accounts and other receivables 108,983 167,733 Less – allowance for doubtful accounts (2,323) (7,467) Total accounts and other receivables – net $ 106,660 $ 160,266 |
Schedule of Allowance for Doubtful Accounts | The roll-forward of allowance for doubtful accounts are summarized in the table below: Balance at Beginning of Year Charged to Costs and Expenses Charged to Other Accounts Deductions Balance at End of Year Year ended December 31, 2019 $ 7,467 $ 274 $ (396) $ (5,022) $ 2,323 Year ended December 31, 2018 1,410 6,226 (187) 18 7,467 Year ended December 31, 2017 3,211 725 (34) (2,492) 1,410 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current | December 31, 2019 2018 Raw materials $ 63,644 $ 55,002 Work in progress 56,065 46,728 Finished goods 58,527 39,368 Spares and other 25,035 24,555 203,271 165,653 Reduction to LIFO cost basis (31,561) (28,471) Total inventories $ 171,710 $ 137,182 |
Property, Plant, Equipment - _2
Property, Plant, Equipment - Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | December 31, 2019 2018 Land and improvements $ 6,396 $ 6,396 Machinery and equipment 1,337,234 1,308,865 Buildings and improvements 184,951 173,328 Construction in progress 97,143 80,720 1,625,724 1,569,309 Less – accumulated depreciation (869,843) (897,099) Total property, plant, equipment – net $ 755,881 $ 672,210 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases, Operating [Abstract] | |
Lease, Cost | The components of lease expense were as follows: Year ended December 31, 2019 Finance lease cost: Amortization of right-of-use asset $ 661 Interest on lease liabilities 70 Total finance lease cost 731 Operating lease cost 36,454 Short-term lease cost 12,885 Total lease cost $ 50,070 Supplemental cash flow information related to leases was as follows: Year ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 36,165 Operating cash flows from finance leases 65 Financing cash flows from finance leases 4,839 Non-cash information: Right-of-use assets obtained in exchange for lease obligations: Operating leases 45,541 Finance leases 1,031 |
Assets and Liabilities, Lessee | Supplemental balance sheet information related to leases was as follows: December 31, 2019 Operating Leases Operating lease right-of-use assets $ 135,985 Operating lease liabilities – short term 38,005 Operating lease liabilities – long term 98,347 Total operating lease liabilities $ 136,352 Finance Leases Property, plant and equipment – gross $ 2,793 Accumulated depreciation (1,391) Property, plant and equipment – net $ 1,402 Accounts payable 712 Other liabilities 708 Total finance lease liabilities $ 1,420 Weighted Average Remaining Lease Term Operating leases 9.1 years Finance leases 2.2 years Weighted Average Discount Rate Operating leases 5.72 % Finance leases 4.79 % |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | The cumulative effect of the changes made to the 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 |
Operating Lease, Liability, Maturity | Maturities of lease liabilities are as follows: Year Ending December 31, Operating Finance 2020 $ 44,454 $ 762 2021 32,264 522 2022 22,602 193 2023 13,033 11 2024 11,166 8 Thereafter 61,506 — Total lease payments 185,025 1,496 Less imputed interest (48,673) (76) Total $ 136,352 $ 1,420 |
Finance Lease, Liability, Maturity | Maturities of lease liabilities are as follows: Year Ending December 31, Operating Finance 2020 $ 44,454 $ 762 2021 32,264 522 2022 22,602 193 2023 13,033 11 2024 11,166 8 Thereafter 61,506 — Total lease payments 185,025 1,496 Less imputed interest (48,673) (76) Total $ 136,352 $ 1,420 |
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 Capital 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 Capital 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 |
Long-term Debt and Credit Agr_2
Long-term Debt and Credit Agreement (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | The Company’s debt at December 31, 2019 consisted of the following: Total term loan outstanding $ — Amounts outstanding under the Revolving Credit Facility 297,000 Total outstanding indebtedness 297,000 Less: amounts expected to be repaid within one year — Total long-term debt due after one year $ 297,000 |
Schedule of Maturities of Long-term Debt | Scheduled principal repayments under the Long-term Debt and Credit Agreement subsequent to December 31, 2019 are as follows: 2020 $ — 2021 — 2022 — 2023 297,000 2024 — Thereafter — Total $ 297,000 |
Postretirement Benefit Obliga_2
Postretirement Benefit Obligations (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Schedule of Defined Benefit Plans Disclosures | The following tables summarize the balance sheet impact, including the benefit obligations, assets and funded status associated with the AdvanSix Retirement Earnings Plan. Change in benefit obligation: 2019 2018 2017 Benefit obligation at January 1, $ 48,450 $ 51,018 $ 33,887 Service Cost 6,855 8,008 7,629 Interest Cost 2,084 1,875 1,333 Actuarial losses (gains) 12,364 (12,324) 8,190 Benefits Paid (472) (127) (21) Benefit obligation at December 31, $ 69,281 $ 48,450 $ 51,018 Change in plan assets: Fair value of plan assets at January 1, $ 26,789 $ 17,321 $ — Actual return on plan assets 5,462 (2,205) 592 Benefits paid (472) (127) (21) Company Contributions 4,200 11,800 16,750 Fair value of plan assets at December 31, 35,979 26,789 17,321 Funded status of plan $ 33,302 $ 21,661 $ 33,697 Amounts recognized in Balance Sheet consists of: Accrued pension liabilities-current (1) $ 892 $ 581 $ 301 Accrued pension liabilities-noncurrent (2) 32,410 21,080 33,396 Total pension liabilities recognized $ 33,302 $ 21,661 $ 33,697 (1) Included in accrued liabilities on Balance Sheet (2) Included in postretirement benefit obligations on Balance Sheet |
Schedule of Amounts Recognized in Other Comprehensive Income (Loss) | Pension amount recognized in accumulated other comprehensive loss (income) associated with the Company's pension plan are as follows for: Years Ended December 31, 2019 2018 2017 Transition obligation $ — $ — $ — Prior service cost — — — Net actuarial (gain) loss 4,012 (4,226) 4,743 Pension amounts recognized in other comprehensive loss (income) $ 4,012 $ (4,226) $ 4,743 |
Schedule of Net Benefit Costs | The components of net periodic benefit cost and other amounts recognized in other comprehensive income for our pension plan include the following components: Years Ended December 31, 2019 2018 2017 Net periodic pension cost (benefit) Service cost $ 6,855 $ 8,008 $ 7,629 Interest cost 2,084 1,875 1,333 Expected return on plan assets (1,336) (1,151) (302) Recognition of actuarial losses — — — Net periodic Pension Cost 7,603 8,732 8,660 Other changes in benefits obligations recognized in other comprehensive loss (income) Actuarial losses (gains) 8,238 (8,969) 7,902 Total recognized in other comprehensive income 8,238 (8,969) 7,902 Total net periodic pension cost (benefit) recognized in Other comprehensive income $ 15,841 $ (237) $ 16,562 |
Schedule of Assumptions Used | Significant actuarial assumptions used in determining the benefit obligations and net periodic benefit cost for our pension plan were as follows: Key actuarial assumptions used to determine benefit obligations at December 31, 2019 2018 2017 Effective discount rate for benefit obligation 3.5% 4.6% 3.9% Expected annual rate of compensation increase 2.4% 2.8% 2.8% Key actuarial assumptions used to determine the net periodic benefit cost for the years ended December 31, 2019 2018 2017 Effective discount rate for service cost 4.6% 3.9% 4.5% Effective discount rate for interest cost 4.3% 3.7% 4.0% Expected long-term rate of return 7.0% 7.0% 5.8% Expected annual rate of compensation increase 2.8% 2.8% 2.8% |
Schedule of Expected Benefit Payments | Benefit payments, including amounts to be paid from Company assets, and reflecting expected future service, as appropriate, are expected to be paid during the following years: 2020 $ 892 2021 1,461 2022 1,836 2023 2,312 2024 2,805 Thereafter 21,327 |
Summary of Pension Plan Contributions | The Company made pension plan contributions sufficient to satisfy pension funding requirements under the AdvanSix Retirement Earnings Plan as follows: Years Ended December 31, 2019 2018 2017 1st Quarter $ — $ 1,950 $ 2,150 2nd Quarter 500 6,600 1,600 3rd Quarter 3,700 3,250 11,050 4th Quarter — — 1,950 Total $ 4,200 $ 11,800 $ 16,750 |
Schedule of Target Asset Allocation of Pension Plan Assets | The target asset allocation percent for the Company's pension plan assets is summarized as follows: Years Ended December 31, 2019 2018 Cash and cash equivalents 2% 2% US and non-US equity securities 65% 65% Fixed income / real estate / other securities 33% 33% Total Pension Assets 100% 100% |
Summary of Fair Value of Plan Assets | Fair Value at December 31, Fair Value Measurements 2019 2018 2017 Investments valued using NAV per share Emerging Markets Region Equities $ 2,264 $ 1,538 $ 1,090 International Region Equities 6,755 4,535 3,215 United States Equities 15,377 11,071 7,273 United States Bonds 9,477 7,878 4,723 Real Estate 1,767 1,357 872 Cash Fund 339 410 148 Total Pension Plan Assets at Fair Value $ 35,979 $ 26,789 $ 17,321 |
Derivative and Hedging Instru_2
Derivative and Hedging Instruments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | Liability Derivatives 2019 2018 2017 Balance Sheet Classification Fair Value 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 $ (1,718) Accrued liabilities and Other liabilities $ (833) N / A $ — Total Derivatives $ (1,718) $ (833) $ — |
Derivative Instruments, Gain (Loss) | The following table summarizes adjustments related to cash flow hedge included in “Cash flow hedges”, in the Consolidated Statements of Comprehensive Income: December 31, 2019 Loss on derivative instruments included in Accumulated other comprehensive income at December 31, 2018 $ (833) Fair value adjustment (885) Loss on derivative instruments included in Accumulated other comprehensive income at December 31, 2019 $ (1,718) |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Recorded Unconditional Purchase Obligations | Future minimum payments for these unconditional purchase obligations as of December 31, 2019 are as follows (dollars in thousands): Year Amount 2020 $ 80,772 2021 38,465 2022 30,142 2023 14,954 2024 11,707 Thereafter 184,544 $ 360,584 |
Changes in Accumulated Other _2
Changes in Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Comprehensive Income (Loss) | The components of accumulated other comprehensive income (loss) are as follows: Currency Translation Adjustment Postretirement Benefit Obligations Adjustment Changes in Fair Value of Effective Cash Flow Hedges Accumulated Other Comprehensive Income (loss) Balance at December 31, 2016 $ (4,998) $ 1,963 $ — $ (3,035) Other comprehensive income (loss) 12 (7,902) — (7,890) Amounts reclassified from accumulated other comprehensive income (loss) — — — — Income tax expense (benefit) — 1,879 — 1,879 Current period change 12 (6,023) — (6,011) Balance at December 31, 2017 (4,986) (4,060) — (9,046) Other comprehensive income (loss) (25) 8,969 (833) 8,111 Amounts reclassified from accumulated other comprehensive income (loss) — 410 — 410 Income tax expense (benefit) — (2,149) 200 (1,949) Current period change (25) 7,230 (633) 6,572 Balance at December 31, 2018 (5,011) 3,170 (633) (2,474) Other comprehensive income (loss) (9) (8,238) (1,589) (9,836) Amounts reclassified from accumulated other comprehensive income (loss) — — 705 705 Income tax expense (benefit) — 1,943 211 2,154 Current period change (9) (6,295) (673) (6,977) Balance at December 31, 2019 $ (5,020) $ (3,125) $ (1,306) $ (9,451) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The details of the earnings per share calculations for the years ended December 31, 2019, 2018 and 2017 are as follows: Years Ended December 31, 2019 2018 2017 Basic Net Income $ 41,347 $ 66,244 $ 146,699 Weighted average common shares outstanding 28,122,288 30,172,050 30,482,966 EPS – Basic $ 1.47 $ 2.20 $ 4.81 Years Ended December 31, 2019 2018 2017 Diluted Net Income $ 41,347 $ 66,244 $ 146,699 Weighted average common shares outstanding – Basic 28,122,288 30,172,050 30,482,966 Dilutive effect of unvested equity awards 776,548 806,241 608,635 Weighted average common shares outstanding – Diluted 28,898,836 30,978,291 31,091,601 EPS – Diluted $ 1.43 $ 2.14 $ 4.72 |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Share-based Compensation, Restricted Stock Units Award Activity | The following table summarizes information about RSU activity related to the Equity Plan: Number of Restricted Stock Units (In Thousands) Weighted Average Grant Date Fair Value (Per Share) Non-vested at December 31, 2016 908 $ 16.41 Granted 98 27.43 Vested — — Forfeited (2) 27.73 Non-vested at December 31, 2017 1,004 17.46 Granted 65 41.58 Vested (73) 19.31 Forfeited (2) 32.59 Non-vested at December 31, 2018 994 18.90 Granted 131 29.42 Vested (864) 16.78 Forfeited (7) 32.93 Non-vested at December 31, 2019 254 $ 30.97 |
Schedule of Share Based Compensation Income Statement Impact From RSUs | The following table summarizes information about the income statement impact from RSUs for the years ended December 31, 2019, 2018 and 2017: Years Ended December 31, 2019 2018 2017 Compensation expense $ 6,125 $ 6,606 $ 6,141 Future income tax benefit recognized $ 678 $ 1,262 $ 755 |
Schedule Of Share Based Compensation Income Statement Impact From Stock Options | The following table summarizes information about the income statement impact from stock options for the years ended December 31, 2019, 2018 and 2017. Years Ended December 31, 2019 2018 2017 Compensation expense $ 1,989 $ 1,470 $ 969 Future income tax benefit recognized $ 745 $ 466 $ 230 |
Schedule of Key Black-Scholes Assumptions | The fair value related to stock options granted was determined using Black-Scholes option pricing model and the weighted average assumptions are shown in the table below: Years Ended December 31, Key Black-Scholes Assumptions 2019 2018 2017 Risk-free interest rate 2.5% 2.7% 2.2% Expected term (years) 6 6 6 Volatility 30.9% 29.7% 37.0% Dividend yield — — — Fair value per stock option $11.67 $14.44 $10.48 |
Summary of Stock Option Activity | The following table summarizes information about stock option activity related to the Equity Plan: Number of Shares Weighted Average Exercise Price (Per Share) Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding at December 31, 2016 — $ — — Granted 175 26.66 Exercised — — Forfeited (3) 26.66 Expired — — Outstanding at December 31, 2017 172 26.66 9.31 $ 2,651 Exercisable at December 31, 2017 — $ — — $ — Granted 129 41.97 Exercised — — Forfeited (3) 33.64 Expired — — Outstanding at December 31, 2018 298 33.24 8.80 $ — Exercisable at December 31, 2018 57 $ 33.23 8.30 $ — Granted 196 33.34 Exercised 1 26.66 Forfeited (4) 31.75 Expired — — Outstanding at December 31, 2019 491 33.28 8.22 $ — Exercisable at December 31, 2019 156 $ 30.83 7.45 |
Summary of Performance Stock Unit Activity | The following table summarizes information about PSU activity related to the Equity Plan: Number of Performance Stock Units (In Thousands) Weighted Average Grant Date Fair Value Non-vested at December 31, 2016 — $ — Granted 90 26.66 Vested — — Forfeited (1) 26.66 Non-vested at December 31, 2017 89 26.66 Granted 58 41.97 Vested — — Forfeited (2) 31.68 Non-vested at December 31, 2018 145 32.73 Granted 88 33.34 Vested — — Forfeited (3) 35.04 Non-vested at December 31, 2019 230 30.03 |
Schedule Of Share Based Compensation Income Statement Impact From PSUs | The following table summarizes information about the income statement impact from PSUs for the year ended December 31, 2019, 2018 and 2017. Years Ended December 31, 2019 2018 2017 Compensation expense $ 236 $ 2,057 $ 632 Future income tax benefit recognized $ 271 $ 252 $ 66 |
Unaudited Selected Quarterly _2
Unaudited Selected Quarterly Financial Data (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Unaudited Selected Quarterly Financial Data | The following tables show selected unaudited quarterly results of operations for 2019 and 2018. The quarterly data has been prepared on the same basis as the audited annual financial statements and include all adjustments, which include only normal recurring adjustments, necessary for the fair statement of our results of operations for these periods. 2019 March 31, June 30, September 30, December 31, Year Ended Net Sales $ 314,895 $ 345,215 $ 310,633 $ 326,650 $ 1,297,393 Gross Profit 48,015 42,087 30,510 14,860 135,472 Net Income 20,174 15,346 7,921 (2,094) 41,347 Earnings per share – basic (1) 0.70 0.54 0.29 (0.08) 1.47 Earnings per share – diluted (1) 0.68 0.53 0.28 (0.08) 1.43 2018 March 31, June 30, September 30, December 31, Year Ended Net Sales $ 359,238 $ 400,459 $ 368,653 $ 386,634 $ 1,514,984 Gross Profit 37,918 57,501 25,219 53,849 174,487 Net Income 11,593 28,410 5,480 20,761 66,244 Earnings per share – basic (1) 0.38 0.93 0.18 0.70 2.20 Earnings per share – diluted (1) 0.37 0.91 0.18 0.68 2.14 (1) Total for the full year may differ from the sum of the individual quarters due to the requirement to use weighted average shares each quarter which may fluctuate with share repurchases and share issuances. |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | Restructuring costs for the year ended December 31, 2019 were as follows: Year ended December 31, 2019 Write-off of equipment and facility $ 7,164 Facility exit costs 1,326 Employee separations 1,491 Inventory write-downs 1,039 Total restructuring charges $ 11,020 |
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 December 31, 2019: Employee Separation Benefits Facility Exit Costs Total Accrual balance at December 31, 2018 $ — $ — $ — Charges 1,491 1,326 2,817 Cash payments (1,364) (916) (2,280) Accrual balance at December 31, 2019 $ 127 $ 410 $ 537 |
Organization, Operations and _2
Organization, Operations and Basis of Presentation - Narrative (Details) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 | Oct. 01, 2016 |
Accounting Policies [Abstract] | |||
Common stock par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accounting Policies | |||
Checks outstanding | $ 1,700,000 | ||
Inventories – net | 171,710,000 | $ 137,182,000 | |
Inventory, LIFO reserve | 31,561,000 | 28,471,000 | |
Goodwill | 15,005,000 | 15,005,000 | |
Research and development expense | 13,900,000 | 14,800,000 | $ 12,900,000 |
Interest and penalties | 0 | 0 | 0 |
Unrecognized tax benefits | $ 0 | $ 0 | $ 0 |
Operating lease term (in years) | 20 years | ||
Common stock, shares issued (in shares) | 31,423,898 | 30,555,715 | |
Minimum | Buildings and improvements | |||
Accounting Policies | |||
Property, plant, equipment useful life (in years) | 30 years | ||
Minimum | Machinery and equipment | |||
Accounting Policies | |||
Property, plant, equipment useful life (in years) | 5 years | ||
Minimum | Standard plant assets | |||
Accounting Policies | |||
Property, plant, equipment useful life (in years) | 15 years | ||
Minimum | Major process equipment | |||
Accounting Policies | |||
Property, plant, equipment useful life (in years) | 5 years | ||
Maximum | Buildings and improvements | |||
Accounting Policies | |||
Property, plant, equipment useful life (in years) | 50 years | ||
Maximum | Machinery and equipment | |||
Accounting Policies | |||
Property, plant, equipment useful life (in years) | 40 years | ||
Maximum | Assets used in short production cycles or subject to high corrosion | |||
Accounting Policies | |||
Property, plant, equipment useful life (in years) | 15 years | ||
Maximum | Standard plant assets | |||
Accounting Policies | |||
Property, plant, equipment useful life (in years) | 30 years | ||
Maximum | Major process equipment | |||
Accounting Policies | |||
Property, plant, equipment useful life (in years) | 40 years |
Revenue - Narrative (Details)
Revenue - Narrative (Details) | 12 Months Ended | |||
Dec. 31, 2019countrycustomer | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disaggregation of Revenue [Line Items] | ||||
Number of customers | customer | 400 | |||
Number of countries in which customers are located (more than) | country | 40 | |||
Contract with customer, timing of performance obligation | We typically sell to customers under master services agreements, with primarily one-year terms, or by purchase orders | |||
Duration of customer relationship | 20 years | |||
Percentage of sales | 100.00% | 100.00% | 100.00% | 100.00% |
Total sales | 10 Largest Customers | Customer concentration risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk (as a percentage) | 47.00% | 45.00% | 44.00% | |
Total sales | Shaw Industries Group Inc | Customer concentration risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 22.00% | 22.00% | 22.00% |
Revenue - Percentage of Total S
Revenue - Percentage of Total Sales by Product Line (Details) | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 100.00% | 100.00% | 100.00% | 100.00% |
Nylon | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 27.00% | 28.00% | 29.00% | |
Caprolactam | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 22.00% | 19.00% | 19.00% | |
Ammonium Sulfate Fertilizer | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 23.00% | 20.00% | 19.00% | |
Chemical Intermediates | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 28.00% | 33.00% | 33.00% |
Revenue - Revenue by Geographic
Revenue - Revenue by Geographic Area (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Net Sales | $ 326,650 | $ 310,633 | $ 345,215 | $ 314,895 | $ 386,634 | $ 368,653 | $ 400,459 | $ 359,238 | $ 1,297,393 | $ 1,514,984 | $ 1,475,194 |
United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net Sales | 1,057,000 | 1,271,000 | 1,189,000 | ||||||||
International | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net Sales | $ 240,000 | $ 244,000 | $ 286,000 |
Revenue - Deferred Income and C
Revenue - Deferred Income and Customer Advances (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Change in Contract with Customer, Liability [Roll Forward] | |
Opening balance January 1, 2019 | $ 22,556 |
Additional cash advances | 19,517 |
Less amounts recognized in revenues | (22,377) |
Ending balance December 31, 2019 | $ 19,696 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Before Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
U.S. | $ 53,231 | $ 85,596 | $ 144,499 |
Non-U.S. | 117 | 172 | 133 |
Income (loss) before taxes | $ 53,348 | $ 85,768 | $ 144,632 |
Income Taxes - Schedule of In_2
Income Taxes - Schedule of Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current Provision: | |||
Federal | $ 2,519 | $ 7,529 | $ 3,682 |
State | 1,007 | 2,442 | 1,743 |
Non-U.S. | 24 | 27 | 22 |
Total current provision | 3,550 | 9,998 | 5,447 |
Deferred Provision: | |||
Federal | 7,536 | 8,081 | (6,824) |
State | 907 | 1,435 | (700) |
Non-U.S. | 8 | 10 | 10 |
Deferred Income Tax Expense (Benefit), Total | 8,451 | 9,526 | (7,514) |
Income taxes | $ 12,001 | $ 19,524 | $ (2,067) |
Income Taxes - Schedule of In_3
Income Taxes - Schedule of Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
U.S. federal statutory income tax rate | 21.00% | 21.00% | 35.00% |
2017 Act | 0 | (0.019) | (0.376) |
U.S. state income taxes | 2.80% | 3.50% | 2.60% |
U.S. state income tax rate change | 0.00% | 0.00% | (1.70%) |
Manufacturing incentives | 0.00% | 0.00% | (0.30%) |
Executive compensation limitations | 1.50% | 1.20% | 0.70% |
Tax credits | (3.00%) | (0.50%) | 0.00% |
Other, net | 0.20% | (0.50%) | (0.10%) |
Effective income tax rate | 22.50% | 22.80% | (1.40%) |
Interest Expense Limitation | $ 2,655 | $ 0 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes [Line Items] | ||||
Tax Cuts and Jobs Act, income tax expense (benefit) | $ (1,651,000) | $ (53,424,000) | ||
Deferred income tax expense (benefit) | (8,451,000) | (9,526,000) | $ 7,514,000 | |
Additional paid-in capital | 180,884,000 | 234,699,000 | ||
Unrecognized tax benefits | 0 | 0 | $ 0 | |
Operating loss carryfowards, not subject to expiration | 38,301,000 | |||
Operating loss carryforwards, subject to expiration | 2,139,000 | |||
Tax credit carryforwards | 758,000 | |||
Undistributed earnings | 0 | 0 | ||
Foreign carryforward | ||||
Income Taxes [Line Items] | ||||
Operating loss carryforwards | $ 70,000 | $ 111,000 | ||
Accounting Standards Update 2018-02 | ||||
Income Taxes [Line Items] | ||||
Tax Cuts and Jobs Act, reclassification from AOCI to retained earnings | $ (400,000) |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Net Operating Loss | $ 8,167 | $ 27 |
Accruals and Reserves | 2,859 | 4,158 |
Interest Expense Limitation | 2,655 | 0 |
Pension Obligation | 7,318 | 4,804 |
Equity Compensation | 1,695 | 1,979 |
Other | 1,314 | 289 |
Total gross deferred tax assets | 24,008 | 11,257 |
Less: Valuation Allowance | 0 | 0 |
Total deferred tax assets | 24,008 | 11,257 |
Deferred tax liabilities: | ||
Property, plant & equipment | (123,915) | (102,783) |
Intangibles | (3,713) | (3,280) |
Inventory | (5,503) | (8,252) |
Other | (931) | (698) |
Total deferred tax liabilities | (134,062) | (115,013) |
Net deferred taxes | $ (110,054) | $ (103,756) |
Accounts and Other Receivable_3
Accounts and Other Receivables - Net - Schedule of Accounts and Other Receivables (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Receivables [Abstract] | ||
Accounts receivables | $ 105,275 | $ 166,017 |
Other | 3,708 | 1,716 |
Total accounts and other receivables | 108,983 | 167,733 |
Less – allowance for doubtful accounts | (2,323) | (7,467) |
Total accounts and other receivables – net | $ 106,660 | $ 160,266 |
Accounts and Other Receivable_4
Accounts and Other Receivables - Net - Schedule of Allowance for Doubtful Accounts (Details) - SEC Schedule, 12-09, Allowance, Credit Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Year | $ 7,467 | $ 1,410 | $ 3,211 |
Charged to Costs and Expenses | 274 | 6,226 | 725 |
Charged to Other Accounts | (396) | (187) | (34) |
Deductions | (5,022) | 18 | (2,492) |
Balance at End of Year | $ 2,323 | $ 7,467 | $ 1,410 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 63,644 | $ 55,002 |
Work in progress | 56,065 | 46,728 |
Finished goods | 58,527 | 39,368 |
Spares and other | 25,035 | 24,555 |
Inventory, gross | 203,271 | 165,653 |
Reduction to LIFO cost basis | (31,561) | (28,471) |
Total inventories | $ 171,710 | $ 137,182 |
Property, Plant, Equipment - _3
Property, Plant, Equipment - Net - Schedule of Property, Plant, and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property, plant, equipment, gross | $ 1,625,724 | $ 1,569,309 |
Less – accumulated depreciation | (869,843) | (897,099) |
Total property, plant, equipment – net | 755,881 | 672,210 |
Land and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, equipment, gross | 6,396 | 6,396 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, equipment, gross | 1,337,234 | 1,308,865 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, equipment, gross | 184,951 | 173,328 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, equipment, gross | $ 97,143 | $ 80,720 |
Property, Plant, Equipment - _4
Property, Plant, Equipment - Net - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |||
Capitalized interest | $ 6,359 | $ 3,619 | $ 3,637 |
Depreciation expense | $ 53,424 | $ 49,729 | $ 46,428 |
Leases - Narrative (Details)
Leases - Narrative (Details) | Dec. 31, 2019 |
Leases, Operating [Abstract] | |
Operating lease term (in years) | 20 years |
Leases - Components of Cost (De
Leases - Components of Cost (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Finance lease cost: | |
Amortization of right-of-use asset | $ 661 |
Interest on lease liabilities | 70 |
Total finance lease cost | 731 |
Operating lease cost | 36,454 |
Short-term lease cost | 12,885 |
Total lease cost | $ 50,070 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows from operating leases | $ 36,165 |
Operating cash flows from finance leases | 65 |
Financing cash flows from finance leases | 4,839 |
Right-of-use assets obtained in exchange for lease obligations: | |
Operating leases | 45,541 |
Finance leases | $ 1,031 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 |
Operating Leases | ||
Operating Lease, Right-of-Use Asset | $ 135,985 | $ 117,921 |
Operating lease liabilities – short term | 38,005 | 24,794 |
Operating lease liabilities – long term | 98,347 | 93,127 |
Total operating lease liabilities | 136,352 | |
Finance Leases | ||
Property, plant and equipment – gross | 2,793 | |
Accumulated depreciation | (1,391) | |
Property, plant and equipment – net | 1,402 | $ 1,032 |
Accounts payable | 712 | |
Other liabilities | 708 | |
Total finance lease liabilities | $ 1,420 | |
Weighted Average Remaining Lease Term | ||
Operating leases | 9 years 1 month 6 days | |
Finance leases | 2 years 2 months 12 days | |
Weighted Average Discount Rate | ||
Operating leases | 5.72% | |
Finance leases | 4.79% |
Leases - Cumulative Effect of A
Leases - Cumulative Effect of Adoption of New Leasing Standard (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
ASSETS | |||
Property, plant and equipment - net | $ 1,032 | ||
Property, plant and equipment – net | $ 1,402 | $ 1,032 | |
Operating Lease, Right-of-Use Asset | 135,985 | 117,921 | |
Total assets | 1,235,969 | 1,152,547 | 1,034,626 |
Current liabilities: | |||
Accounts Payable | 318 | 318 | |
Operating lease liabilities – short term | 38,005 | 24,794 | |
Total current liabilities | 291,726 | 309,518 | 284,724 |
Operating lease liabilities – long term | 98,347 | 93,127 | |
Other liabilities | 762 | 762 | |
Total liabilities | 835,091 | 732,209 | 614,288 |
Total equity | 420,338 | 420,338 | |
Total liabilities and equity | $ 1,235,969 | 1,152,547 | $ 1,034,626 |
Accounting Standards Update 2016-02 | |||
ASSETS | |||
Property, plant and equipment – net | 0 | ||
Operating Lease, Right-of-Use Asset | 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 | Dec. 31, 2019USD ($) |
Operating Leases | |
2020 | $ 44,454 |
2021 | 32,264 |
2022 | 22,602 |
2023 | 13,033 |
2024 | 11,166 |
Thereafter | 61,506 |
Total lease payments | 185,025 |
Less imputed interest | (48,673) |
Total | 136,352 |
Finance Leases | |
2020 | 762 |
2021 | 522 |
2022 | 193 |
2023 | 11 |
2024 | 8 |
Thereafter | 0 |
Total lease payments | 1,496 |
Less imputed interest | (76) |
Total | $ 1,420 |
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 |
Long-term Debt and Credit Agr_3
Long-term Debt and Credit Agreement - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Total outstanding indebtedness | $ 297,000 | |
Less: amounts due within one year | 0 | |
Total long-term debt due after one year | 297,000 | $ 200,000 |
Long-term debt | ||
Debt Instrument [Line Items] | ||
Total outstanding indebtedness | 0 | |
Revolving credit facility | ||
Debt Instrument [Line Items] | ||
Total outstanding indebtedness | $ 297,000 |
Long-term Debt and Credit Agr_4
Long-term Debt and Credit Agreement - Schedule of Maturities of Long-Term Debt (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Debt Disclosure [Abstract] | |
2020 | $ 0 |
2021 | 0 |
2022 | 0 |
2023 | 297,000 |
2024 | 0 |
Thereafter | 0 |
Total | $ 297,000 |
Long-term Debt and Credit Agr_5
Long-term Debt and Credit Agreement - Narrative (Details) - USD ($) | Feb. 21, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Feb. 20, 2018 | Sep. 30, 2016 |
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Borrowings from line of credit | $ 419,250,000 | $ 345,000,000 | $ 308,500,000 | |||
Outstanding line of credit | 297,000,000 | |||||
Letter of credit | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Outstanding line of credit | 4,200,000 | |||||
Revolving credit facility | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Percentage decrease in overall borrowing costs | 0.50% | |||||
Outstanding line of credit | 297,000,000 | |||||
Original Credit Agreement | Letter of credit | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Maximum aggregate principal amount | $ 25,000,000 | |||||
Original Credit Agreement | Bridge loan | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Maximum aggregate principal amount | 20,000,000 | |||||
Original Credit Agreement | Revolving credit facility | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Debt instrument face amount | 155,000,000 | |||||
Senior Secured Revolving Credit Facility | Revolving credit facility | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Maximum aggregate principal amount | $ 425,000,000 | |||||
Borrowings from line of credit | $ 242,000,000 | |||||
Debt instrument term | 5 years | |||||
First Amended and Restated Credit Agreement | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Option for higher borrowing capacity | $ 175,000,000 | |||||
Consolidated senior secured leverage ratio (less than) | 1.75 | |||||
Consolidated interest coverage ratio (not less than) | 3 | |||||
Consolidated leverage ratio, period one (less than) | 3.50 | |||||
Consolidated leverage ratio, period two (less than) | 3.25 | |||||
Consolidated leverage ratio, period three (less than) | 3 | |||||
Consolidated leverage ratio, period four (less than) | 2.75 | |||||
First Amended and Restated Credit Agreement | Base Rate | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Basis spread on variable rate | 0.75% | |||||
First Amended and Restated Credit Agreement | Eurodollar | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Basis spread on variable rate | 1.75% | |||||
Annual commitment fee percentage | 0.25% | |||||
First Amended and Restated Credit Agreement | Minimum | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Annual commitment fee percentage | 0.20% | |||||
First Amended and Restated Credit Agreement | Minimum | Base Rate | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Basis spread on variable rate | 0.50% | |||||
First Amended and Restated Credit Agreement | Minimum | Eurodollar | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Basis spread on variable rate | 1.50% | |||||
First Amended and Restated Credit Agreement | Maximum | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Annual commitment fee percentage | 0.40% | |||||
First Amended and Restated Credit Agreement | Maximum | Base Rate | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Basis spread on variable rate | 1.50% | |||||
First Amended and Restated Credit Agreement | Maximum | Eurodollar | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Basis spread on variable rate | 2.50% | |||||
First Amended and Restated Credit Agreement | Letter of credit | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Maximum aggregate principal amount | $ 40,000,000 | |||||
First Amended and Restated Credit Agreement | Bridge loan | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Maximum aggregate principal amount | $ 40,000,000 | |||||
Bi-lateral Letter of Credit Agreements | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Outstanding line of credit | 3,200,000 | |||||
Revolving credit facility | Letter of credit | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Outstanding line of credit | $ 1,000,000 | |||||
Secured Debt [Member] | Original Credit Agreement | ||||||
Long-term Debt and Credit Arrangements (Details) [Line Items] | ||||||
Debt instrument face amount | $ 270,000,000 | |||||
Debt outstanding | $ 267,000,000 |
Postretirement Benefit Obliga_3
Postretirement Benefit Obligations - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Defined Benefit Plan Disclosure [Line Items] | |||||||||||||||
Company matching contribution, percent of match | 75.00% | ||||||||||||||
Company matching contribution, percent of employees' gross pay | 8.00% | ||||||||||||||
Contributions to defined contribution plan | $ 5,944 | $ 5,514 | $ 5,379 | ||||||||||||
Accumulated benefit obligation | $ 54,400 | $ 36,700 | $ 31,200 | 54,400 | 36,700 | 31,200 | |||||||||
Company Contributions | 0 | $ 3,700 | $ 500 | $ 0 | $ 0 | $ 3,250 | $ 6,600 | $ 1,950 | $ 1,950 | $ 11,050 | $ 1,600 | $ 2,150 | $ 4,200 | $ 11,800 | $ 16,750 |
Collective Bargaining Agreement | |||||||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||||||
Company matching contribution, percent of match | 50.00% | ||||||||||||||
Company matching contribution, percent of employees' gross pay | 8.00% | ||||||||||||||
Minimum | |||||||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||||||
Expected future employer contributions | 5,000 | $ 5,000 | |||||||||||||
Maximum | |||||||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||||||
Expected future employer contributions | $ 10,000 | $ 10,000 |
Postretirement Benefit Obliga_4
Postretirement Benefit Obligations - Defined Benefit Plans Disclosure (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Change in benefit obligation: | |||||||||||||||
Benefit obligation at January 1, | $ 48,450 | $ 51,018 | $ 33,887 | $ 48,450 | $ 51,018 | $ 33,887 | |||||||||
Service Cost | 6,855 | 8,008 | 7,629 | ||||||||||||
Interest Cost | 2,084 | 1,875 | 1,333 | ||||||||||||
Actuarial losses (gains) | 12,364 | (12,324) | 8,190 | ||||||||||||
Benefits Paid | (472) | (127) | (21) | ||||||||||||
Benefit obligation at December 31, | $ 69,281 | $ 48,450 | $ 51,018 | 69,281 | 48,450 | 51,018 | |||||||||
Change in plan assets: | |||||||||||||||
Fair value of plan assets at January 1, | 26,789 | 17,321 | 0 | 26,789 | 17,321 | 0 | |||||||||
Actual return on plan assets | 5,462 | (2,205) | 592 | ||||||||||||
Benefits paid | (472) | (127) | (21) | ||||||||||||
Company Contributions | 0 | $ 3,700 | $ 500 | $ 0 | 0 | $ 3,250 | $ 6,600 | $ 1,950 | 1,950 | $ 11,050 | $ 1,600 | $ 2,150 | 4,200 | 11,800 | 16,750 |
Fair value of plan assets at December 31, | 35,979 | 26,789 | 17,321 | 35,979 | 26,789 | 17,321 | |||||||||
Funded status of plan | 33,302 | 21,661 | 33,697 | 33,302 | 21,661 | 33,697 | |||||||||
Accrued pension liabilities-current | 892 | 581 | 301 | 892 | 581 | 301 | |||||||||
Accrued pension liabilities-noncurrent | 32,410 | 21,080 | 33,396 | 32,410 | 21,080 | 33,396 | |||||||||
Total pension liabilities recognized | $ 33,302 | $ 21,661 | $ 33,697 | $ 33,302 | $ 21,661 | $ 33,697 |
Postretirement Benefit Obliga_5
Postretirement Benefit Obligations - Other Changes in Plan Assets Recognized in Other Comprehensive Income (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Retirement Benefits [Abstract] | |||
Transition obligation | $ 0 | $ 0 | $ 0 |
Prior service cost | 0 | 0 | 0 |
Net actuarial (gain) loss | 4,012 | (4,226) | 4,743 |
Pension amounts recognized in other comprehensive loss (income) | $ 4,012 | $ (4,226) | $ 4,743 |
Postretirement Benefit Obliga_6
Postretirement Benefit Obligations - Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |||
Service Cost | $ 6,855 | $ 8,008 | $ 7,629 |
Interest Cost | 2,084 | 1,875 | 1,333 |
Expected return on plan assets | (1,336) | (1,151) | (302) |
Recognition of actuarial losses | 0 | 0 | 0 |
Net periodic Pension Cost | 7,603 | 8,732 | 8,660 |
Other changes in benefits obligations recognized in other comprehensive loss (income) | |||
Actuarial losses (gains) | 8,238 | (8,969) | 7,902 |
Total recognized in other comprehensive income | 8,238 | (8,969) | 7,902 |
Total net periodic pension cost (benefit) recognized in Other comprehensive income | $ 15,841 | $ (237) | $ 16,562 |
Postretirement Benefit Obliga_7
Postretirement Benefit Obligations - Assumptions Used in Calculations (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Key actuarial assumptions used to determine benefit obligations at December 31, | |||
Effective discount rate for benefit obligation | 3.50% | 4.60% | 3.90% |
Expected annual rate of compensation increase | 2.40% | 2.80% | 2.80% |
Key actuarial assumptions used to determine the net periodic benefit cost for the years ended December 31, | |||
Effective discount rate for service cost | 4.60% | 3.90% | 4.50% |
Effective discount rate for interest cost | 4.30% | 3.70% | 4.00% |
Expected long-term rate of return | 7.00% | 7.00% | 5.80% |
Expected annual rate of compensation increase | 2.80% | 2.80% | 2.80% |
Postretirement Benefit Obliga_8
Postretirement Benefit Obligations - Estimated Future Benefit Payments (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Retirement Benefits [Abstract] | |
2020 | $ 892 |
2021 | 1,461 |
2022 | 1,836 |
2023 | 2,312 |
2024 | 2,805 |
Thereafter | $ 21,327 |
Postretirement Benefit Obliga_9
Postretirement Benefit Obligations - Pension Plan Contributions (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |||||||||||||||
Pension plan contributions | $ 0 | $ 3,700 | $ 500 | $ 0 | $ 0 | $ 3,250 | $ 6,600 | $ 1,950 | $ 1,950 | $ 11,050 | $ 1,600 | $ 2,150 | $ 4,200 | $ 11,800 | $ 16,750 |
Postretirement Benefit Oblig_10
Postretirement Benefit Obligations - Schedule of Target Asset Allocation of Pension Plan Assets (Details) | Dec. 31, 2019 | Dec. 31, 2018 |
Defined Benefit Plan Disclosure [Line Items] | ||
Actual plan asset allocation percentage | 100.00% | 100.00% |
Cash and cash equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual plan asset allocation percentage | 2.00% | 2.00% |
US and non-US equity securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual plan asset allocation percentage | 65.00% | 65.00% |
Fixed income / real estate / other securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual plan asset allocation percentage | 33.00% | 33.00% |
Postretirement Benefit Oblig_11
Postretirement Benefit Obligations - Fair Value Measurement of Plan Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Defined Benefit Plan Disclosure [Line Items] | ||||
Total Pension Plan Assets at Fair Value | $ 35,979 | $ 26,789 | $ 17,321 | $ 0 |
Emerging Markets Region Equities | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total Pension Plan Assets at Fair Value | 2,264 | 1,538 | 1,090 | |
International Region Equities | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total Pension Plan Assets at Fair Value | 6,755 | 4,535 | 3,215 | |
United States Equities | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total Pension Plan Assets at Fair Value | 15,377 | 11,071 | 7,273 | |
United States Bonds | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total Pension Plan Assets at Fair Value | 9,477 | 7,878 | 4,723 | |
Real Estate | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total Pension Plan Assets at Fair Value | 1,767 | 1,357 | 872 | |
Cash Fund | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total Pension Plan Assets at Fair Value | $ 339 | $ 410 | $ 148 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) | Dec. 31, 2019USD ($)derivative_instrument | Jul. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Nov. 30, 2018USD ($) |
Interest Rate Swap | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Derivative liability | $ 0 | $ 0 | ||
Number of derivative instruments held | derivative_instrument | 2 | |||
Fair Value, Inputs, Level 3 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Royalty agreement, fair value | $ 1,000,000 | |||
Fair Value, Inputs, Level 2 | Interest Rate Swap | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Derivative liability | $ (1,700,000) | $ (800,000) |
Derivative and Hedging Instru_3
Derivative and Hedging Instruments - Narrative (Details) | 12 Months Ended | |||
Dec. 31, 2019USD ($)derivative_instrument | Dec. 31, 2018 | Jul. 31, 2019USD ($) | Nov. 30, 2018USD ($) | |
Concentration Risk [Line Items] | ||||
Gain (loss) expected to be reclassified from AOCI to income | $ 800,000 | |||
Accounts Receivable | One Customer | Customer concentration risk | ||||
Concentration Risk [Line Items] | ||||
Concentration risk (as a percentage) | 22.00% | |||
Interest Rate Swap | ||||
Concentration Risk [Line Items] | ||||
Derivative, amount of hedged item | $ 100,000,000 | |||
Derivative liability | $ 0 | $ 0 | ||
Number of derivative instruments held | derivative_instrument | 2 |
Derivative and Hedging Instru_4
Derivative and Hedging Instruments - Balance Sheet Classification (Details) - USD ($) | Dec. 31, 2019 | Jul. 31, 2019 | Dec. 31, 2018 | Nov. 30, 2018 | Dec. 31, 2017 |
Interest Rate Swap | |||||
Derivatives, Fair Value [Line Items] | |||||
Derivative liability | $ 0 | $ 0 | |||
Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Derivative liability | $ (1,718,000) | $ (833,000) | $ 0 | ||
Accrued Liabilities and Other Liabilities | Designated as Hedging Instrument | Interest Rate Contract | |||||
Derivatives, Fair Value [Line Items] | |||||
Derivative liability | $ (1,718,000) | $ (833,000) | $ 0 |
Derivative and Hedging Instru_5
Derivative and Hedging Instruments - Adjustments Related to Cash Flow Hedges on the Comprehensive Income Statement (Details) - Changes in Fair Value of Effective Cash Flow Hedges $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Derivative [Line Items] | |
Loss on derivative instruments included in Accumulated other comprehensive income at December 31, 2018 | $ (833) |
Fair value adjustment | (885) |
Loss on derivative instruments included in Accumulated other comprehensive income at December 31, 2019 | $ (1,718) |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - Schedule of Recorded Unconditional Purchase Obligations $ in Thousands | Dec. 31, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2020 | $ 80,772 |
2021 | 38,465 |
2022 | 30,142 |
2023 | 14,954 |
2024 | 11,707 |
Thereafter | 184,544 |
Future minimum payments for unconditional purchase obligations | $ 360,584 |
Changes in Accumulated Other _3
Changes in Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | $ 420,338 | ||
Other comprehensive income (loss) | (9,836) | $ 8,111 | $ (7,890) |
Amounts reclassified from accumulated other comprehensive income (loss) | 705 | 410 | 0 |
Income tax expense (benefit) | 2,154 | (1,949) | 1,879 |
Other comprehensive income (loss), net of tax | (6,977) | 6,572 | (6,011) |
Ending balance | 420,338 | ||
Currency Translation Adjustment | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | (5,011) | (4,986) | (4,998) |
Other comprehensive income (loss) | (9) | (25) | 12 |
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 | 0 |
Income tax expense (benefit) | 0 | 0 | 0 |
Other comprehensive income (loss), net of tax | (9) | (25) | 12 |
Ending balance | (5,020) | (5,011) | (4,986) |
Postretirement Benefit Obligations Adjustment | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | 3,170 | (4,060) | 1,963 |
Other comprehensive income (loss) | (8,238) | 8,969 | (7,902) |
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 410 | 0 |
Income tax expense (benefit) | 1,943 | (2,149) | 1,879 |
Other comprehensive income (loss), net of tax | (6,295) | 7,230 | (6,023) |
Ending balance | (3,125) | 3,170 | (4,060) |
Changes in Fair Value of Effective Cash Flow Hedges | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | (633) | ||
Other comprehensive income (loss) | (1,589) | (833) | |
Amounts reclassified from accumulated other comprehensive income (loss) | 705 | 0 | |
Income tax expense (benefit) | 211 | 200 | |
Other comprehensive income (loss), net of tax | (673) | (633) | |
Ending balance | (1,306) | (633) | |
Changes in Fair Value of Effective Cash Flow Hedges | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | 0 | 0 | |
Other comprehensive income (loss) | 0 | ||
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | ||
Income tax expense (benefit) | 0 | ||
Other comprehensive income (loss), net of tax | 0 | ||
Ending balance | 0 | ||
Accumulated Other Comprehensive Income (Loss) | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | (2,474) | (9,046) | (3,035) |
Ending balance | $ (9,451) | $ (2,474) | $ (9,046) |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Feb. 22, 2019 | May 04, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Number of shares repurchased (in shares) | 1,898,013 | ||||
Shares paid for tax withholding obligations (in shares) | 400,394 | ||||
Value of stock repurchased | $ 62.2 | ||||
Average market price of common stock repurchased (in dollars per share) | $ 27.04 | ||||
Stock Options | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Antidilutive securities (in shares) | 544,635 | 349,312 | 0 | ||
Deferred Compensation, Share-based Payments | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Number of units allocated to stock unit fund (in shares) | 29,106 | ||||
May 2018 Repurchase Program | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Number of shares authorized for repurchase (in shares) | 75,000,000 | ||||
February 2019 Repurchase Program | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Number of shares authorized for repurchase (in shares) | 75,000,000 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Earnings Per Share - Basic (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Basic | |||||||||||
Net Income | $ 41,347 | $ 66,244 | $ 146,699 | ||||||||
Weighted average common shares outstanding (in shares) | 28,122,288 | 30,172,050 | 30,482,966 | ||||||||
EPS – Basic (in dollars per share) | $ (0.08) | $ 0.29 | $ 0.54 | $ 0.70 | $ 0.70 | $ 0.18 | $ 0.93 | $ 0.38 | $ 1.47 | $ 2.20 | $ 4.81 |
Earnings Per Share - Schedule_2
Earnings Per Share - Schedule of Earnings Per Share - Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Diluted | |||||||||||
Net Income | $ 41,347 | $ 66,244 | $ 146,699 | ||||||||
Weighted average common shares outstanding – Basic (in shares) | 28,122,288 | 30,172,050 | 30,482,966 | ||||||||
Dilutive effect of unvested equity awards (in shares) | 776,548 | 806,241 | 608,635 | ||||||||
Weighted average common shares outstanding – Diluted (in shares) | 28,898,836 | 30,978,291 | 31,091,601 | ||||||||
EPS – Diluted (in dollars per share) | $ (0.08) | $ 0.28 | $ 0.53 | $ 0.68 | $ 0.68 | $ 0.18 | $ 0.91 | $ 0.37 | $ 1.43 | $ 2.14 | $ 4.72 |
Stock-Based Compensation Plan_2
Stock-Based Compensation Plans - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized (in shares) | 3,350,000 | ||
Number of shares available for grant (in shares) | 1,438,519 | ||
Stock-based compensation | $ 8,349 | $ 10,131 | $ 7,742 |
Awards other than full value | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized (in shares) | 1,750,000 | ||
Number of shares available for grant (in shares) | 328,799 | ||
RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation cost | $ 3,600 | ||
Period for recognition (in years) | 3 months 29 days | ||
RSUs | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period (in years) | 1 year | ||
RSUs | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period (in years) | 3 years | ||
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation cost | $ 1,400 | ||
Period for recognition (in years) | 10 months 24 days | ||
Stock Options | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period (in years) | 1 year | ||
Stock Options | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period (in years) | 3 years | ||
Performance Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period (in years) | 36 months | ||
Unrecognized compensation cost | $ 2,100 | ||
Period for recognition (in years) | 10 months 24 days | ||
Award performance period (in years) | 3 years | ||
Performance Stock Units | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Target return percentage | 0.00% | ||
Performance Stock Units | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Target return percentage | 200.00% |
Stock-Based Compensation Plan_3
Stock-Based Compensation Plans - Schedule of RSU Activity Related to Equity Plan (Details) - RSUs - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Number of Restricted Stock Units (In Thousands) | |||
Number of units, beginning balance (in shares) | 994 | 1,004 | 908 |
Number of units, Granted (in shares) | 131 | 65 | 98 |
Number of units, Vested (in shares) | 864 | 73 | 0 |
Number of units, Forfeited (in shares) | (7) | (2) | (2) |
Number of units, ending balance (in shares) | 254 | 994 | 1,004 |
Weighted Average Grant Date Fair Value (Per Share) | |||
Weighted Average Grant Date Fair Value Per Share, beginning balance (in dollars per share) | $ 18.90 | $ 17.46 | $ 16.41 |
Weighted Average Grant Date Fair Value Per Share, Granted (in dollars per share) | 29.42 | 41.58 | 27.43 |
Weighted Average Grant Date Fair Value Per Share, Vested (in dollars per share) | 16.78 | 19.31 | 0 |
Weighted Average Grant Date Fair Value Per Share, Forfeited (in dollars per share) | 32.93 | 32.59 | 27.73 |
Weighted Average Grant Date Fair Value Per Share, ending balance (in dollars per share) | $ 30.97 | $ 18.90 | $ 17.46 |
Stock-Based Compensation Plan_4
Stock-Based Compensation Plans - Schedule of Income Statement Impact (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Equity Compensation | $ 1,695,000 | $ 1,979,000 | |
RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | 6,125,000 | 6,606,000 | $ 6,141,000 |
Equity Compensation | 678,000 | 1,262,000 | 755,000 |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | 1,989,000 | 1,470,000 | 969,000 |
Equity Compensation | 745,000 | 466,000 | 230,000 |
Performance Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | 236,000 | 2,057,000 | 632,000 |
Equity Compensation | $ 271,000 | $ 252,000 | $ 66,000 |
Stock-Based Compensation Plan_5
Stock-Based Compensation Plans Stock-Based Compensation Plans - Schedule of Key Black-Scholes Assumptions (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Payment Arrangement [Abstract] | |||
Risk-free interest rate percentage | 2.50% | 2.70% | 2.20% |
Expected term (years) | 6 years | 6 years | 6 years |
Volatility percentage | 30.90% | 29.70% | 37.00% |
Dividend yield percentage | 0.00% | 0.00% | 0.00% |
Fair value per stock option (in dollars per share) | $ 11.67 | $ 14.44 | $ 10.48 |
Stock-Based Compensation Plan_6
Stock-Based Compensation Plans - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Number of Shares (in thousands) | ||||
Number of Shares, beginning balance (in shares) | 298 | 172 | 0 | |
Number of Shares, Granted (in shares) | 196 | 129 | 175 | |
Number of Shares, Exercised (in shares) | 1 | 0 | 0 | |
Number of Shares, Forfeited (in shares) | (4) | (3) | (3) | |
Number of Shares, Expired (in shares) | 0 | 0 | 0 | |
Number of Shares, ending balance (in shares) | 491 | 298 | 172 | 0 |
Exercisable shares (in shares) | 156 | 57 | 0 | |
Weighted Average Exercise Price (per share) | ||||
Weighted Average Exercise Price, beginning balance (in dollars per share) | $ 33.24 | $ 26.66 | $ 0 | |
Weighted Average Exercise Price, Granted (in dollars per share) | 33.34 | 41.97 | 26.66 | |
Weighted Average Exercise Price, Exercised (in dollars per share) | 26.66 | 0 | 0 | |
Weighted Average Exercise Price, Forfeited (in dollars per share) | 31.75 | 33.64 | 26.66 | |
Weighted Average Exercise Price, Expired (in dollars per share) | 0 | 0 | 0 | |
Weighted Average Exercise Price, ending balance (in dollars per share) | 33.28 | 33.24 | 26.66 | $ 0 |
Weighted Average Exercise Price, Exerciseable (in dollars per dollars per share) | $ 30.83 | $ 33.23 | $ 0 | |
Options outstanding, Weighted Average Remaining Contractual Term (years) | 8 years 9 months 18 days | 9 years 3 months 21 days | 0 years | |
Options exercisable, Weighted Average Remaining Contractual Term (years) | 8 years 3 months 18 days | 0 years | ||
Aggregate Intrinsic Value, Outstanding (in thousands) | $ 0 | $ 0 | $ 2,651 | |
Aggregate Intrinsic Value, Exercisable (in thousands) | $ 0 | $ 0 |
Stock-Based Compensation Plan_7
Stock-Based Compensation Plans - Schedule of Nonvested PSUs (Details) - Performance Stock Units - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Number of Performance Stock Units (In Thousands) | |||
Number of units, beginning balance (in shares) | 145 | 89 | 0 |
Number of units, Granted (in shares) | 88 | 58 | 90 |
Number of units, Vested (in shares) | 0 | 0 | 0 |
Number of units, Forfeited (in shares) | (3) | (2) | (1) |
Number of units, ending balance (in shares) | 230 | 145 | 89 |
Weighted Average Grant Date Fair Value (per share) | |||
Weighted Average Grant Date Fair Value Per Share, beginning balance (in dollars per share) | $ 32.73 | $ 26.66 | $ 0 |
Weighted Average Grant Date Fair Value Per Share, Granted (in dollars per share) | 33.34 | 41.97 | 26.66 |
Weighted Average Grant Date Fair Value Per Share, Vested (in dollars per share) | 0 | 0 | 0 |
Weighted Average Grant Date Fair Value Per Share, Forfeited (in dollars per share) | 35.04 | 31.68 | 26.66 |
Weighted Average Grant Date Fair Value Per Share, ending balance (in dollars per share) | $ 30.03 | $ 32.73 | $ 26.66 |
Unaudited Selected Quarterly _3
Unaudited Selected Quarterly Financial Data - Schedule of Unaudited Quarterly Financial Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net Sales | $ 326,650 | $ 310,633 | $ 345,215 | $ 314,895 | $ 386,634 | $ 368,653 | $ 400,459 | $ 359,238 | $ 1,297,393 | $ 1,514,984 | $ 1,475,194 |
Gross Profit | 14,860 | 30,510 | 42,087 | 48,015 | 53,849 | 25,219 | 57,501 | 37,918 | 135,472 | 174,487 | |
Net Income | $ (2,094) | $ 7,921 | $ 15,346 | $ 20,174 | $ 20,761 | $ 5,480 | $ 28,410 | $ 11,593 | $ 41,347 | $ 66,244 | $ 146,699 |
Earnings per share – basic (in dollars per share) | $ (0.08) | $ 0.29 | $ 0.54 | $ 0.70 | $ 0.70 | $ 0.18 | $ 0.93 | $ 0.38 | $ 1.47 | $ 2.20 | $ 4.81 |
Earnings per share – diluted (in dollars per share) | $ (0.08) | $ 0.28 | $ 0.53 | $ 0.68 | $ 0.68 | $ 0.18 | $ 0.91 | $ 0.37 | $ 1.43 | $ 2.14 | $ 4.72 |
Restructuring - Restructuring C
Restructuring - Restructuring Costs (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Restructuring and Related Activities [Abstract] | |
Write-off of equipment and facility | $ 7,164,000 |
Facility exit costs | 1,326,000 |
Employee separations | 1,491,000 |
Inventory write-downs | 1,039,000 |
Total restructuring charges | $ 11,020,000 |
Restructuring - Restructuring A
Restructuring - Restructuring Activities (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Restructuring Reserve [Roll Forward] | |
Accrual balance at December 31, 2018 | $ 0 |
Restructuring Charges | 2,817,000 |
Cash payments | (2,280,000) |
Accrual balance at December 31, 2019 | 537,000 |
Employee separations | |
Restructuring Reserve [Roll Forward] | |
Accrual balance at December 31, 2018 | 0 |
Restructuring Charges | 1,491,000 |
Cash payments | (1,364,000) |
Accrual balance at December 31, 2019 | 127,000 |
Facility exit costs | |
Restructuring Reserve [Roll Forward] | |
Accrual balance at December 31, 2018 | 0 |
Restructuring Charges | 1,326,000 |
Cash payments | (916,000) |
Accrual balance at December 31, 2019 | $ 410,000 |
Subsequent Events (Details)
Subsequent Events (Details) - Second Amended And Restated Credit Agreement | Feb. 19, 2020 | Mar. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 |
Scenario, Forecast | |||||||
Subsequent Event [Line Items] | |||||||
Debt instrument, covenant, consolidated leverage ratio, maximum | 3 | 3.25 | 3.50 | 4.25 | 4.50 | 3.50 | |
Subsequent event | |||||||
Subsequent Event [Line Items] | |||||||
Consolidated interest coverage ratio (not less than) | 3 | ||||||
Annual commitment fee percentage | 0.35% | ||||||
Subsequent event | Minimum | |||||||
Subsequent Event [Line Items] | |||||||
Annual commitment fee percentage | 0.20% | ||||||
Subsequent event | Maximum | |||||||
Subsequent Event [Line Items] | |||||||
Annual commitment fee percentage | 0.50% | ||||||
Subsequent event | Base Rate | |||||||
Subsequent Event [Line Items] | |||||||
Basis spread on variable rate | 1.25% | ||||||
Subsequent event | Base Rate | Minimum | |||||||
Subsequent Event [Line Items] | |||||||
Basis spread on variable rate | 0.50% | ||||||
Subsequent event | Base Rate | Maximum | |||||||
Subsequent Event [Line Items] | |||||||
Basis spread on variable rate | 2.00% | ||||||
Subsequent event | Eurodollar | |||||||
Subsequent Event [Line Items] | |||||||
Basis spread on variable rate | 2.25% | ||||||
Subsequent event | Eurodollar | Minimum | |||||||
Subsequent Event [Line Items] | |||||||
Basis spread on variable rate | 1.50% | ||||||
Subsequent event | Eurodollar | Maximum | |||||||
Subsequent Event [Line Items] | |||||||
Basis spread on variable rate | 3.00% |