Document and Entity Information
Document and Entity Information | 9 Months Ended |
Sep. 30, 2020shares | |
Cover [Abstract] | |
Security Exchange Name | NYSE |
Title of 12(b) Security | Common Stock |
Entity Interactive Data Current | Yes |
City Area Code | 704 |
Entity Address, Address Line One | 130 Harbour Place Drive, Suite 300 |
Entity Address, City or Town | Davidson, |
Entity Address, State or Province | NC |
Entity Address, Postal Zip Code | 28036 |
Entity Incorporation, State or Country Code | DE |
Entity File Number | 1-134 |
Entity Registrant Name | CURTISS-WRIGHT CORPORATION |
Entity Central Index Key | 0000026324 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Sep. 30, 2020 |
Document Transition Report | false |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | Q3 |
Amendment Flag | false |
Entity common stock shares outstanding | 41,502,026 |
Trading Symbol | CW |
Entity Current Reporting Status | Yes |
Emerging Company | false |
Small Business | false |
Entity Tax Identification Number | 13-0612970 |
Local Phone Number | 869-4600 |
Entity Shell Company | false |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Net Sales | ||||
Net sales | $ 571,614 | $ 614,880 | $ 1,722,892 | $ 1,832,190 |
Total net sales | 571,614 | 614,880 | 1,722,892 | 1,832,190 |
Cost of sales | ||||
Total cost of sales | 358,793 | 388,804 | 1,123,466 | 1,179,197 |
Gross profit | 212,821 | 226,076 | 599,426 | 652,993 |
Research and development expenses | 17,587 | 18,362 | 54,163 | 54,503 |
Selling expenses | 24,869 | 28,133 | 81,650 | 90,303 |
General and administrative expenses | 77,251 | 74,012 | 230,515 | 224,888 |
Restructuring Charges | 8,541 | 0 | 20,730 | 0 |
Operating income | 84,573 | 105,569 | 212,368 | 283,299 |
Interest expense | (9,055) | (7,951) | (25,059) | (23,183) |
Other income, net | 5,417 | 6,355 | 6,844 | 17,704 |
Earnings from continuing operations before income taxes | 80,935 | 103,973 | 194,153 | 277,820 |
Provision for income taxes | (16,315) | (21,463) | (46,754) | (59,645) |
Net earnings | $ 64,620 | $ 82,510 | $ 147,399 | $ 218,175 |
Basic earnings per share | ||||
Basic earnings per share (usd per share) | $ 1.56 | $ 1.93 | $ 3.52 | $ 5.10 |
Diluted earnings per share | ||||
Diluted earnings per share (usd per share) | 1.55 | 1.92 | 3.49 | 5.07 |
Dividends per share | $ 0.17 | $ 0.17 | $ 0.51 | $ 0.49 |
Weighted average shares outstanding: | ||||
Basic (shares) | 41,545 | 42,709 | 41,926 | 42,755 |
Diluted (shares) | 41,797 | 42,995 | 42,190 | 43,025 |
Product [Member] | ||||
Product sales | $ 493,398 | $ 516,760 | $ 1,457,772 | $ 1,520,612 |
Cost of sales | ||||
Cost of Goods and Services Sold | 305,921 | 331,793 | 945,886 | 986,475 |
Service [Member] | ||||
Net Sales | ||||
Net sales | 78,216 | 98,120 | 265,120 | 311,578 |
Cost of sales | ||||
Cost of Goods and Services Sold | $ 52,872 | $ 57,011 | $ 177,580 | $ 192,722 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | ||
Statement of Comprehensive Income [Abstract] | |||||
Net earnings | $ 64,620 | $ 82,510 | $ 147,399 | $ 218,175 | |
Other comprehensive income | |||||
Foreign currency translation, net of tax | [1] | 28,229 | (24,734) | 2,139 | (15,952) |
Pension and postretirement adjustments, net of tax | [2] | 3,561 | 1,311 | 12,244 | 4,743 |
Other comprehensive income (loss), net of tax | 31,790 | (23,423) | 14,383 | (11,209) | |
Comprehensive income | $ 96,410 | $ 59,087 | $ 161,782 | $ 206,966 | |
[1] | The tax benefit included in other comprehensive income for foreign currency translation adjustments for the three and nine months ended September 30, 2020 was $0.6 million and $1.0 million, respectively. The tax benefit included in other comprehensive loss for foreign currency translation adjustments for both the three and nine months ended September 30, 2019 was $0.6 million. | ||||
[2] | The tax expense included in other comprehensive income for pension and postretirement adjustments for the three and nine months ended September 30, 2020 was $1.3 million and $4.0 million, respectively. The tax expense included in other comprehensive income for pension and postretirement adjustments for the three and nine months ended September 30, 2019 was $0.4 million and $1.5 million, respectively. |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parentheticals) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | ||
Statement of Comprehensive Income [Abstract] | |||||
Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Tax | [1] | $ 600 | $ 600 | $ 1,000 | $ 600 |
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, Tax, Attributable to Parent | [2] | $ 1,300 | $ 400 | $ 4,000 | $ 1,500 |
[1] | The tax benefit included in other comprehensive income for foreign currency translation adjustments for the three and nine months ended September 30, 2020 was $0.6 million and $1.0 million, respectively. The tax benefit included in other comprehensive loss for foreign currency translation adjustments for both the three and nine months ended September 30, 2019 was $0.6 million. | ||||
[2] | The tax expense included in other comprehensive income for pension and postretirement adjustments for the three and nine months ended September 30, 2020 was $1.3 million and $4.0 million, respectively. The tax expense included in other comprehensive income for pension and postretirement adjustments for the three and nine months ended September 30, 2019 was $0.4 million and $1.5 million, respectively. |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Current Assets: | ||
Cash and cash equivalents | $ 426,821 | $ 391,033 |
Receivables, net | 634,944 | 632,194 |
Inventories, net | 460,585 | 424,835 |
Other current assets | 58,403 | 81,729 |
Total current assets | 1,580,753 | 1,529,791 |
Property, plant, and equipment, net | 379,859 | 385,593 |
Goodwill | 1,207,881 | 1,166,680 |
Other intangible assets, net | 476,864 | 479,907 |
Operating Lease, Right-of-Use Asset | 152,987 | 165,490 |
Assets for Plan Benefits, Defined Benefit Plan | 131,631 | 0 |
Other assets | 29,805 | 36,800 |
Total assets | 3,959,780 | 3,764,261 |
Current liabilities: | ||
Accounts payable | 158,020 | 222,000 |
Accrued expenses | 136,965 | 164,744 |
Income taxes payable | 5,711 | 7,670 |
Deferred revenue | 267,504 | 276,115 |
Other current liabilities | 97,634 | 74,202 |
Total current liabilities | 665,834 | 744,731 |
Long-term debt | 1,058,707 | 760,639 |
Deferred Income Tax Liabilities, Net | 94,720 | 80,159 |
Accrued pension and other postretirement benefit costs | 91,745 | 138,635 |
Long-term operating lease liability | 133,476 | 145,124 |
Long-term portion of environmental reserves | 15,269 | 15,026 |
Other liabilities | 100,566 | 105,575 |
Total liabilities | 2,160,317 | 1,989,889 |
Stockholders' Equity | ||
Common stock, $1 par value,100,000,000 shares authorized as of September 30, 2020 and December 31, 2019; 49,187,378 shares issued as of September 30, 2020 and December 31, 2019; outstanding shares were 41,502,026 as of September 30, 2020 and 42,680,215 as of December 31, 2019 | 49,187 | 49,187 |
Additional paid in capital | 121,797 | 116,070 |
Retained earnings | 2,623,289 | 2,497,111 |
Accumulated other comprehensive loss | (310,891) | (325,274) |
Common treasury stock, at cost (7,685,352 shares as of September 30, 2020 and 6,507,163 shares as of December 31, 2019) | (683,919) | (562,722) |
Total stockholders' equity | 1,799,463 | 1,774,372 |
Total liabilities and stockholders' equity | $ 3,959,780 | $ 3,764,261 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (usd per share) | $ 1 | $ 1 |
Common Stock, Shares Authorized | 100,000,000 | 100,000,000 |
Common Stock, Shares, Issued | 49,187,378 | 49,187,378 |
Common Stock, Shares, Outstanding | 41,502,026 | 42,680,215 |
Treasury Stock, Shares | 7,685,352 | 6,507,163 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities: | ||
Net earnings | $ 147,399 | $ 218,175 |
Adjustments to reconcile net earnings to net cash provided by operating activities | ||
Depreciation and amortization | 84,769 | 76,998 |
Gain on fixed asset disposals | (370) | (6,295) |
Deferred income taxes | 4,258 | 652 |
Share-based compensation | 11,777 | 11,262 |
Foreign exchange loss on substantial liquidation of subsidiary | 9,498 | 0 |
Non-cash restructuring charges | 10,254 | 0 |
Change in operating assets and liabilities, net of businesses acquired and divested: | ||
Accounts receivable, net | 1,987 | (44,788) |
Inventories, net | (33,322) | (8,587) |
Progress Payments | (3,036) | (4,955) |
Accounts payable and accrued expenses | (90,944) | (86,900) |
Deferred revenue | (8,841) | 18,750 |
Income taxes payable | 9,409 | 2,676 |
Net pension and postretirement liabilities | (150,674) | (928) |
Other current and long-term assets and liabilities | 11,620 | (17,045) |
Net cash provided by operating activities | 3,784 | 159,015 |
Cash flows from investing activities: | ||
Proceeds from sales and disposals of long lived assets | 2,476 | 10,099 |
Payments to Acquire Intangible Assets | 0 | (157) |
Additions to property, plant, and equipment | (36,341) | (49,919) |
Acquisition of businesses, net of cash acquired | 82,053 | 50,075 |
Net cash used for investing activities | (115,918) | (90,052) |
Cash flows from financing activities: | ||
Borrowings under revolving credit facility | 389,398 | 35,387 |
Payments of revolving credit facility | (389,398) | (35,550) |
Borrowings of debt | 300,000 | 0 |
Repurchases of common stock | (137,155) | (37,864) |
Proceeds from share-based compensation | 9,908 | 10,943 |
Dividends paid | (14,160) | (13,683) |
Other | (648) | (600) |
Net cash provided by (used for) financing activities | 157,945 | (41,367) |
Effect of exchange-rate changes on cash | (10,023) | (5,950) |
Net increase in cash and cash equivalents | 35,788 | 21,646 |
Cash and cash equivalents at beginning of period | 391,033 | 276,066 |
Cash and cash equivalents at end of period | 426,821 | 297,712 |
Supplemental disclosure of non-cash activities: | ||
Capital expenditures incurred but not yet paid | $ 1,668 | $ 88 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands | Total | Common Stock Member | Additional Paid In Capital Member | Retained Earnings Member | Retained Earnings MemberCumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Loss Member | Accumulated Other Comprehensive Loss MemberCumulative Effect, Period of Adoption, Adjustment | Treasury Stock Member |
Beginning Balance at Dec. 31, 2018 | $ 49,187 | $ 118,234 | $ 2,191,471 | $ 26,257 | $ (288,447) | $ (26,257) | $ (539,664) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net earnings | $ 218,175 | 218,175 | ||||||
Other Comprehensive Income (Loss), Net of Tax | (11,209) | (11,209) | ||||||
Dividends paid/declared | (20,947) | |||||||
Restricted stock | (5,491) | 5,491 | ||||||
Stock options exercised | (2,720) | 13,662 | ||||||
Other | (661) | 661 | ||||||
Share-based compensation | 10,857 | 405 | ||||||
Repurchases of common stock | (37,864) | |||||||
Ending Balance at Sep. 30, 2019 | 49,187 | 120,219 | 2,414,956 | (325,913) | (557,309) | |||
Beginning Balance at Dec. 31, 2018 | 49,187 | 118,234 | 2,191,471 | $ 26,257 | (288,447) | $ (26,257) | (539,664) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Other Comprehensive Income (Loss), Net of Tax | (10,570) | |||||||
Ending Balance at Dec. 31, 2019 | 1,774,372 | 49,187 | 116,070 | 2,497,111 | (325,274) | (562,722) | ||
Beginning Balance at Jun. 30, 2019 | 49,187 | 116,835 | 2,339,703 | (302,490) | (550,939) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net earnings | 82,510 | 82,510 | ||||||
Other Comprehensive Income (Loss), Net of Tax | (23,423) | (23,423) | ||||||
Dividends paid/declared | (7,257) | |||||||
Stock options exercised | (898) | 6,429 | ||||||
Share-based compensation | 4,282 | 0 | ||||||
Repurchases of common stock | (12,799) | |||||||
Ending Balance at Sep. 30, 2019 | 49,187 | 120,219 | 2,414,956 | (325,913) | (557,309) | |||
Beginning Balance at Dec. 31, 2019 | 1,774,372 | 49,187 | 116,070 | 2,497,111 | (325,274) | (562,722) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net earnings | 147,399 | 147,399 | ||||||
Other Comprehensive Income (Loss), Net of Tax | 14,383 | 14,383 | ||||||
Dividends paid/declared | (21,221) | |||||||
Restricted stock | (4,115) | 4,115 | ||||||
Stock options exercised | (1,364) | 11,272 | ||||||
Other | (517) | 517 | ||||||
Share-based compensation | 11,723 | 54 | ||||||
Repurchases of common stock | (137,155) | |||||||
Ending Balance at Sep. 30, 2020 | 1,799,463 | 49,187 | 121,797 | 2,623,289 | (310,891) | (683,919) | ||
Beginning Balance at Jun. 30, 2020 | 49,187 | 118,467 | 2,565,727 | (342,681) | (677,405) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net earnings | 64,620 | 64,620 | ||||||
Other Comprehensive Income (Loss), Net of Tax | 31,790 | 31,790 | ||||||
Dividends paid/declared | (7,058) | |||||||
Stock options exercised | (1,470) | 6,191 | ||||||
Share-based compensation | 4,800 | (163) | ||||||
Repurchases of common stock | (12,542) | |||||||
Ending Balance at Sep. 30, 2020 | $ 1,799,463 | $ 49,187 | $ 121,797 | $ 2,623,289 | $ (310,891) | $ (683,919) |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION Curtiss-Wright Corporation and its subsidiaries (the "Corporation" or the "Company") is a global, diversified manufacturing and service company that designs, manufactures, and overhauls precision components and provides highly engineered products and services to the aerospace, defense, power generation, and general industrial markets. The unaudited condensed consolidated financial statements include the accounts of Curtiss-Wright and its majority-owned subsidiaries. All intercompany transactions and accounts have been eliminated. The unaudited condensed consolidated financial statements of the Corporation have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in annual financial statements have been condensed or omitted as permitted by such rules and regulations. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments necessary for a fair presentation of these financial statements. Management is required to make estimates and judgments that affect the reported amount of assets, liabilities, revenue, and expenses and disclosure of contingent assets and liabilities in the accompanying financial statements. Actual results may differ from these estimates. The most significant of these estimates includes the estimate of costs to complete on contracts using the over-time revenue recognition accounting method, cash flow estimates used for testing the recoverability of assets, pension plan and postretirement obligation assumptions, estimates for inventory obsolescence, fair value estimates around assets and assumed liabilities from acquisitions, estimates for the valuation and useful lives of intangible assets, legal reserves, and the estimate of future environmental costs. Changes in estimates of contract sales, costs, and profits are recognized using the cumulative catch-up method of accounting. This method recognizes in the current period the cumulative effect of the changes on current and prior periods. Accordingly, the effect of the changes on future periods of contract performance is recognized as if the revised estimate had been the original estimate. During the three and nine months ended September 30, 2020 and 2019, there were no significant changes in estimated contract costs. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Corporation’s 2019 Annual Report on Form 10-K. The results of operations for interim periods are not necessarily indicative of trends or of the operating results for a full year. On January 1, 2020, the Corporation implemented an organizational change to align its reportable segments more closely with its current business structure. This change resulted in the transfer of two business units, one from the Commercial/Industrial segment to the Defense segment and the other from the Defense segment to the Power segment. While this organizational change resulted in the recasting of previously reported amounts across all reportable segments, it did not impact the Corporation’s previously reported consolidated financial statements. Recent accounting pronouncements adopted A SU 2016-13 -Financial Instruments—Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments . On January 1, 2020, the Company adopted ASU 2016-13 -Financial Instruments—Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments . This ASU added a current expected credit loss impairment model to U.S. GAAP based on expected losses rather than incurred losses. As the Corporation is not subject to material trade credit risk given that a significant portion of its sales are generated from contracts with agencies of or prime contractors to the U.S. Government , the adoption of this standard did not result in any impact to its allowance for doubtful accounts balance as of January 1, 2020. As a result of adoption, the Corporation utilizes current and historical collection data as well as assess current economic conditions in order to determine expected trade credit losses on a prospective basis. |
REVENUE (Notes)
REVENUE (Notes) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | REVENUE The Corporation recognizes revenue when control of a promised good and/or service is transferred to a customer in an amount that reflects the consideration that the Corporation expects to be entitled to in exchange for that good and/or service. Performance Obligations The Corporation identifies a performance obligation for each promise in a contract to transfer a distinct good or service to the customer. As part of its assessment, the Corporation considers all goods and/or services promised in the contract, regardless of whether they are explicitly stated or implied by customary business practices. The Corporation’s contracts may contain either a single performance obligation, including the promise to transfer individual goods or services that are not separately distinct within the context of the respective contracts, or multiple performance obligations. For contracts with multiple performance obligations, the Corporation allocates the overall transaction price to each performance obligation using standalone selling prices, where available, or utilizes estimates for each distinct good or service in the contract where standalone prices are not available. The Corporation’s performance obligations are satisfied either at a point-in-time or on an over-time basis. Typically, over-time revenue recognition is based on the utilization of an input measure used to measure progress, such as costs incurred to date relative to total estimated costs. Point-in-time revenue is recognized at the point in time in which control is transferred to the customer, typically based upon the terms of delivery. The following table illustrates the approximate percentage of revenue recognized for performance obligations satisfied over-time versus at a point-in-time for the three and nine months ended September 30, 2020 and 2019: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Over-time 50 % 47 % 52 % 48 % Point-in-time 50 % 53 % 48 % 52 % Contract backlog represents the remaining performance obligations that have not yet been recognized as revenue. Backlog includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods. Total backlog was approximately $2.2 billion as of September 30, 2020, of which the Corporation expects to recognize approximately 90% as net sales over the next 12-36 months. The remainder will be recognized thereafter. Disaggregation of Revenue The following table presents the Corporation’s total net sales disaggregated by end market and customer type: Total Net Sales by End Market & Customer Type Three Months Ended Nine Months Ended September 30, September 30, (In thousands) 2020 2019 2020 2019 Defense Aerospace $ 121,987 $ 110,742 $ 333,120 $ 293,955 Ground 20,519 22,231 63,205 69,383 Naval 165,524 143,430 496,157 424,371 Total Defense Customers $ 308,030 $ 276,403 $ 892,482 $ 787,709 Commercial Aerospace $ 70,943 $ 109,015 $ 242,708 $ 320,237 Power Generation 80,509 88,543 241,059 278,194 General Industrial 112,132 140,919 346,643 446,050 Total Commercial Customers $ 263,584 $ 338,477 $ 830,410 $ 1,044,481 Total $ 571,614 $ 614,880 $ 1,722,892 $ 1,832,190 Contract Balances Timing of revenue recognition and cash collection may result in billed receivables, unbilled receivables (contract assets), and deferred revenue (contract liabilities) on the Condensed Consolidated Balance Sheet. The Corporation’s contract assets |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended |
Sep. 30, 2020 | |
Business Combinations [Abstract] | |
ACQUISITIONS | ACQUISITIONS The Corporation continually evaluates potential acquisitions that either strategically fit within the Corporation’s existing portfolio or expand the Corporation’s portfolio into new product lines or adjacent markets. The Corporation has completed a number of acquisitions that have been accounted for as business combinations and have resulted in the recognition of goodwill in the Corporation's financial statements. This goodwill arises because the acquisition purchase price reflects the future earnings and cash flow potential in excess of the earnings and cash flows attributable to the current product and customer set at the time of acquisition. Thus, goodwill inherently includes the know-how of the assembled workforce, the ability of the workforce to further improve the technology and product offerings, and the expected cash flows resulting from these efforts. Goodwill may also include expected synergies resulting from the complementary strategic fit these businesses bring to existing operations. The Corporation allocates the purchase price at the date of acquisition based upon its understanding of the fair value of the acquired assets and assumed liabilities. In the months after closing, as the Corporation obtains additional information about these assets and liabilities, including through tangible and intangible asset appraisals, and as the Corporation learns more about the newly acquired business, it is able to refine the estimates of fair value and more accurately allocate the purchase price. Only items identified as of the acquisition date are considered for subsequent adjustment. The Corporation will make appropriate adjustments to the purchase price allocation prior to completion of the measurement period, as required. During the nine months ended September 30, 2020, the Corporation acquired two businesses for an aggregate purchase price of $90 million, which are described in more detail below. During the nine months ended September 30, 2019, the Corporation acquired one business for an aggregate purchase price of $50 million, which is described in more detail below. The Condensed Consolidated Statement of Earnings for the nine months ended September 30, 2020 includes $12 million of total net sales and $1 million of net losses from the Corporation's 2020 acquisitions. The Condensed Consolidated Statement of Earnings for the nine months ended September 30, 2019 includes $8 million of total net sales and immaterial net earnings from the Corporation's 2019 acquisition. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition for all acquisitions consummated during the nine months ended September 30, 2020 and 2019. (In thousands) 2020 2019 Accounts receivable $ 3,204 $ 2,300 Inventory 10,233 322 Property, plant, and equipment 1,332 648 Other current and non-current assets 188 479 Intangible assets 39,384 26,000 Operating lease right-of-use assets, net 1,992 1,393 Current and non-current liabilities (10,590) (3,252) Net tangible and intangible assets 45,743 27,890 Goodwill 43,912 22,185 Total purchase price $ 89,655 $ 50,075 Cash paid to date, net of cash acquired $ 82,053 $ 50,075 Due to seller 7,602 — Total purchase price $ 89,655 $ 50,075 Goodwill deductible for tax purposes $ 38,519 $ 22,635 2020 Acquisitions Integrated Air Defense System (IADS) On April 20, 2020, the Corporati on acquired the IADS product line for approximately $29 million. The Asset Purchase Agreement contains representations and warranties customary for a transaction of this type. IADS is a real-time display and post-test analysis product for flight tests. The acquired product line operates within the Defense segment. The acquisition is subject to post-closing adjustments with the purchase price allocation not yet complete. Dyna-Flo Control Valve Services Ltd. (Dyna-Flo) On February 26, 2020, the Corporati on acquired 100% of the issued and outstanding share capital of Dyna- Flo for approximately $60 million, net of cash acquired. The Asset Purchase Agreement contains representations and warranties customary for a transaction of this type, including a portion of the purchase price held back as security for potential indemnification claims against the seller. Dyna-Flo specializes in control valves, actuators, and control systems for the chemical, petrochemical, and oil and gas markets. The acquired business operates within the Commercial/Industrial segment. The acquisition is subject to post-closing adjustments with the purchase price allocation not yet complete. 2019 Acquisition Tactical Communications Group (TCG) |
RECEIVABLES
RECEIVABLES | 9 Months Ended |
Sep. 30, 2020 | |
Receivables [Abstract] | |
RECEIVABLES | RECEIVABLES Receivables primarily include amounts billed to customers, unbilled charges on long-term contracts consisting of amounts recognized as sales but not billed, and other receivables. Substantially all amounts of unbilled receivables are expected to be billed and collected within one year. An immaterial amount of unbilled receivables are subject to retainage provisions. The amount of claims and unapproved change orders within our receivables balances are immaterial. The composition of receivables is as follows: (In thousands) September 30, 2020 December 31, 2019 Billed receivables: Trade and other receivables $ 386,098 $ 418,968 Less: Allowance for doubtful accounts (8,755) (8,733) Net billed receivables 377,343 410,235 Unbilled receivables (contract assets): Recoverable costs and estimated earnings not billed 264,807 231,067 Less: Progress payments applied (7,206) (9,108) Net unbilled receivables 257,601 221,959 Receivables, net $ 634,944 $ 632,194 |
INVENTORIES
INVENTORIES | 9 Months Ended |
Sep. 30, 2020 | |
Inventory, Net [Abstract] | |
INVENTORIES | INVENTORIES Inventoried costs contain amounts relating to long-term contracts and programs with long production cycles, a portion of which will not be realized within one year. Long-term contract inventory includes an immaterial amount of claims or other similar items subject to uncertainty concerning their determination or realization. Inventories are valued at the lower of cost or net realizable value. The composition of inventories is as follows: (In thousands) September 30, 2020 December 31, 2019 Raw materials $ 177,729 $ 153,876 Work-in-process 100,710 100,359 Finished goods 130,942 108,329 Inventoried costs related to U.S. Government and other long-term contracts (1) 58,630 70,414 Inventories, net of reserves 468,011 432,978 Less: Progress payments applied (7,426) (8,143) Inventories, net $ 460,585 $ 424,835 (1) As of September 30, 2020 and December 31, 2019, this caption also includes capitalized contract development costs of $30.9 million and $39.1 million, respectively, related to certain aerospace and defense programs. These capitalized costs will be liquidated as units are produced and sold under contract. As of September 30, 2020 and December 31, 2019, capitalized development costs of $16.1 million and $23.7 million, respectively, are not currently supported by existing firm orders. |
GOODWILL
GOODWILL | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill [Abstract] | |
GOODWILL | GOODWILL The changes in the carrying amount of goodwill for the nine months ended September 30, 2020 are as follows: (In thousands) Commercial/Industrial Defense Power Consolidated December 31, 2019 $ 431,082 $ 526,955 $ 208,643 $ 1,166,680 Acquisitions 29,233 14,679 — 43,912 Adjustments — (1,386) — (1,386) Foreign currency translation adjustment (372) (536) (417) (1,325) September 30, 2020 $ 459,943 $ 539,712 $ 208,226 $ 1,207,881 |
OTHER INTANGIBLE ASSETS, NET
OTHER INTANGIBLE ASSETS, NET | 9 Months Ended |
Sep. 30, 2020 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
OTHER INTANGIBLE ASSETS, NET | OTHER INTANGIBLE ASSETS, NET The following tables present the cumulative composition of the Corporation’s intangible assets: September 30, 2020 December 31, 2019 (In thousands) Gross Accumulated Amortization Net Gross Accumulated Amortization Net Technology $ 265,241 $ (150,363) $ 114,878 $ 257,676 $ (140,390) $ 117,286 Customer related intangibles 463,186 (239,688) 223,498 434,492 (215,855) 218,637 Programs (1) 144,000 (18,000) 126,000 144,000 (12,600) 131,400 Other intangible assets 46,267 (33,779) 12,488 43,729 (31,145) 12,584 Total $ 918,694 $ (441,830) $ 476,864 $ 879,897 $ (399,990) $ 479,907 (1) Programs include values assigned to major programs of acquired businesses and represent the aggregate value associated with the customer relationships, contracts, technology, and trademarks underlying the associated program. During the nine months ended September 30, 2020, the Corporation acquired intangible assets of $39.4 million. The Corporation acquired Customer-related intangibles of $28.9 million, Technology of $8.1 million, and Other intangible assets of $2.4 million, which have weighted average amortization periods of 19.4 years, 15.0 years, and 7.5 years, respectively. Total intangible amortization expense for the nine months ended September 30, 2020 was $43.3 million, as compared to $33.9 million in the comparable prior year period. The estimated amortization expense for the five years ending December 31, 2020 through 2024 is $58 million, $48 million, $45 million, $42 million, and $38 million, respectively. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS Forward Foreign Exchange and Currency Option Contracts The Corporation has foreign currency exposure primarily in the United Kingdom, Europe, and Canada. The Corporation uses financial instruments, such as forward and option contracts, to hedge a portion of existing and anticipated foreign currency denominated transactions. The purpose of the Corporation’s foreign currency risk management program is to reduce volatility in earnings caused by exchange rate fluctuations. Guidance on accounting for derivative instruments and hedging activities requires companies to recognize all of the derivative financial instruments as either assets or liabilities at fair value in the Condensed Consolidated Balance Sheets based upon quoted market prices for comparable instruments. Interest Rate Risks and Related Strategies The Corporation’s primary interest rate exposure results from changes in U.S. dollar interest rates. The Corporation’s policy is to manage interest cost using a mix of fixed and variable rate debt. The Corporation periodically uses interest rate swaps to manage such exposures. Under these interest rate swaps, the Corporation exchanges, at specified intervals, the difference between fixed and floating interest amounts calculated by reference to an agreed-upon notional principal amount. The Corporation’s foreign exchange contracts and interest rate swaps are considered Level 2 instruments which are based on market based inputs or unobservable inputs and corroborated by market data such as quoted prices, interest rates, or yield curves. Effects on Condensed Consolidated Balance Sheets As of September 30, 2020 and December 31, 2019, the fair values of the asset and liability derivative instruments were immaterial. Effects on Condensed Consolidated Statements of Earnings Undesignated hedges For the three and nine months ended September 30, 2020 and 2019, the gains or (losses) recognized in income on forward exchange derivative contracts not designated for hedge accounting were as follows: Three Months Ended Nine Months Ended (In thousands) September 30, September 30, Derivatives not designated as hedging instrument 2020 2019 2020 2019 Forward exchange contracts: General and administrative expenses $ 1,730 $ (1,823) $ (5,702) $ (392) Debt The estimated fair value amounts were determined by the Corporation using available market information that is primarily based on quoted market prices for the same or similar issuances as of September 30, 2020. Accordingly, all of the Corporation’s debt is valued as a Level 2 financial instrument. The fair values described below may not be indicative of net realizable value or reflective of future fair values. Furthermore, the use of different methodologies to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. September 30, 2020 December 31, 2019 (In thousands) Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value 3.84% Senior notes due 2021 100,000 102,447 100,000 102,079 3.70% Senior notes due 2023 202,500 211,571 202,500 207,882 3.85% Senior notes due 2025 90,000 97,021 90,000 93,838 4.24% Senior notes due 2026 200,000 223,547 200,000 213,126 4.05% Senior notes due 2028 67,500 75,258 67,500 71,260 4.11% Senior notes due 2028 90,000 100,825 90,000 95,607 3.10% Senior notes due 2030 150,000 155,387 — — 3.20% Senior notes due 2032 150,000 154,622 — — Total debt 1,050,000 1,120,678 750,000 783,792 Debt issuance costs, net (1,180) (1,180) (594) (594) Unamortized interest rate swap proceeds 9,887 9,887 11,233 11,233 Total debt, net $ 1,058,707 $ 1,129,385 $ 760,639 $ 794,431 |
PENSION AND OTHER POSTRETIREMEN
PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS | 9 Months Ended |
Sep. 30, 2020 | |
Retirement Benefits, Description [Abstract] | |
PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS | PENSION PLANS Defined Benefit Pension Plans The following table is a consolidated disclosure of all domestic and foreign defined pension plans as described in the Corporation’s 2019 Annual Report on Form 10-K. The components of net periodic pension cost for the three and nine months ended September 30, 2020 and 2019 were as follows: Three Months Ended Nine Months Ended September 30, September 30, (In thousands) 2020 2019 2020 2019 Service cost $ 6,285 $ 6,096 $ 19,507 $ 17,747 Interest cost 5,772 7,045 17,888 21,788 Expected return on plan assets (16,602) (14,645) (50,394) (44,411) Amortization of prior service cost 178 170 36 29 Amortization of unrecognized actuarial loss 5,539 1,557 17,038 6,741 Net periodic pension cost $ 1,172 $ 223 $ 4,075 $ 1,894 During the nine months ended September 30, 2020, the Corporation made a $150 million voluntary contribution to the Curtiss-Wright Pension Plan. The Corporation does not expect to make any further contributions to the Curtiss-Wright Pension Plan in 2020. Contributions to the foreign benefit plans are not expected to be material in 2020. Defined Contribution Retirement Plan Effective January 1, 2014, all non-union employees who were not currently receiving final or career average pay benefits became eligible to receive employer contributions in the Corporation’s sponsored 401(k) plan. The employer contributions include both employer match and non-elective contribution components up to a maximum employer contribution of 7% of eligible compensation. During the three and nine months ended September 30, 2020, the expense relating to the plan was $4.5 million and $14.8 million, respectively. During the three and nine months ended September 30, 2019, the expense relating to the plan was $4.2 million and $13.8 million, respectively. The Corporation made $16.5 million in contributions to the plan during the nine months ended September 30, 2020, and expects to make total contributions of $18.3 million in 2020. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE Diluted earnings per share was computed based on the weighted-average number of shares outstanding plus all potentially dilutive common shares. A reconciliation of basic to diluted shares used in the earnings per share calculation is as follows: Three Months Ended Nine Months Ended September 30, September 30, (In thousands) 2020 2019 2020 2019 Basic weighted-average shares outstanding 41,545 42,709 41,926 42,755 Dilutive effect of stock options and deferred stock compensation 252 286 264 270 Diluted weighted-average shares outstanding 41,797 42,995 42,190 43,025 |
SEGMENT INFORMATION
SEGMENT INFORMATION | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION The Corporation manages and evaluates its operations based on end markets to strengthen its ability to service customers and recognize certain organizational efficiencies. Based on this approach, the Corporation has three reportable segments: Commercial/Industrial, Defense, and Power. The Corporation’s measure of segment profit or loss is operating income. Interest expense and income taxes are not reported on an operating segment basis as they are not considered in the segments’ performance evaluation by the Corporation’s chief operating decision-maker, its Chief Executive Officer. Net sales and operating income by reportable segment were as follows: Three Months Ended Nine Months Ended September 30, September 30, (In thousands) 2020 2019 2020 2019 Net sales Commercial/Industrial $ 222,734 $ 279,064 $ 701,048 $ 842,373 Defense 180,355 160,445 516,531 452,983 Power 168,976 176,162 506,664 539,616 Less: Intersegment revenues (451) (791) (1,351) (2,782) Total consolidated $ 571,614 $ 614,880 $ 1,722,892 $ 1,832,190 Operating income (expense) Commercial/Industrial $ 24,838 $ 43,641 $ 74,191 $ 130,222 Defense 41,550 40,241 98,126 93,580 Power 25,962 28,776 67,843 86,140 Corporate and eliminations (1) (7,777) (7,089) (27,792) (26,643) Total consolidated $ 84,573 $ 105,569 $ 212,368 $ 283,299 (1) Corporate and eliminations includes service costs related to pension and other postretirement benefits, certain environmental costs related to remediation at legacy sites, foreign currency transactional gains and losses, and certain other expenses. Adjustments to reconcile operating income to earnings before income taxes are as follows: Three Months Ended Nine Months Ended September 30, September 30, (In thousands) 2020 2019 2020 2019 Total operating income $ 84,573 $ 105,569 $ 212,368 $ 283,299 Interest expense 9,055 7,951 25,059 23,183 Other income, net 5,417 6,355 6,844 17,704 Earnings before income taxes $ 80,935 $ 103,973 $ 194,153 $ 277,820 (In thousands) September 30, 2020 December 31, 2019 Identifiable assets Commercial/Industrial $ 1,391,570 $ 1,363,592 Defense 1,242,648 1,209,706 Power 875,745 885,727 Corporate and Other 449,817 305,236 Total consolidated $ 3,959,780 $ 3,764,261 |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 9 Months Ended |
Sep. 30, 2020 | |
Stockholders' Equity Note [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The cumulative balance of each component of accumulated other comprehensive income (AOCI), net of tax, is as follows: (In thousands) Foreign currency translation adjustments, net Total pension and postretirement adjustments, net Accumulated other comprehensive income (loss) December 31, 2018 $ (147,148) $ (141,299) $ (288,447) Other comprehensive income (loss) before reclassifications 18,447 (35,212) (16,765) Amounts reclassified from accumulated other comprehensive loss — 6,195 6,195 Net current period other comprehensive loss 18,447 (29,017) (10,570) Cumulative effect from adoption of ASU 2018-02 $ (1,318) $ (24,939) $ (26,257) December 31, 2019 $ (130,019) $ (195,255) $ (325,274) Other comprehensive income (loss) before reclassifications 2,139 (339) 1,800 Amounts reclassified from accumulated other comprehensive income — 12,583 12,583 Net current period other comprehensive income 2,139 12,244 14,383 September 30, 2020 $ (127,880) $ (183,011) $ (310,891) Details of amounts reclassified from accumulated other comprehensive income (loss) are below: (In thousands) Amount reclassified from AOCI Affected line item in the Condensed Consolidated Statement of Earnings Defined benefit pension and other postretirement benefit plans Amortization of prior service costs $ 457 Other income, net Amortization of actuarial losses (17,034) Other income, net (16,577) Earnings before income taxes 3,994 Provision for income taxes Total reclassifications $ (12,583) Net earnings |
CONTINGENCIES AND COMMITMENTS
CONTINGENCIES AND COMMITMENTS | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES AND COMMITMENTS | CONTINGENCIES AND COMMITMENTS In the ordinary course of business, the Corporation and its subsidiaries are subject to various pending claims, lawsuits, and contingent liabilities. The Corporation does not believe that the disposition of any of these matters, individually or in the aggregate, will have a material adverse effect on its consolidated financial condition, results of operations, and cash flows. Legal Proceedings The Corporation has been named in a number of lawsuits that allege injury from exposure to asbestos. To date, the Corporation has not been found liable for or paid any material sum of money in settlement in any asbestos-related case. The Corporation believes its minimal use of asbestos in its past operations as well as its acquired businesses’ operations and the relatively non-friable condition of asbestos in its historical products makes it unlikely that it will face material liability in any asbestos litigation, whether individually or in the aggregate. The Corporation maintains insurance coverage and indemnification agreements for these potential liabilities and believes adequate coverage exists to cover any unanticipated asbestos liability. Letters of Credit and Other Financial Arrangements The Corporation enters into standby letters of credit agreements and guarantees with financial institutions and customers primarily relating to guarantees of repayment, future performance on certain contracts to provide products and services, and to secure advance payments from certain international customers. As of September 30, 2020 and December 31, 2019, there were $21.9 million and $32.6 million of stand-by letters of credit outstanding, respectively, and $6.6 million and $10.8 million of bank guarantees outstanding, respectively. In addition, the Corporation is required to provide the Nuclear Regulatory Commission financial assurance demonstrating its ability to cover the cost of decommissioning its Cheswick, Pennsylvania facility upon closure, though the Corporation does not intend to close this facility. The Corporation has provided this financial assurance in the form of a $45.6 million surety bond. |
RESTRUCTURING COSTS
RESTRUCTURING COSTS | 9 Months Ended |
Sep. 30, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Activities Disclosure | RESTRUCTURING COSTS During the three and nine months ended September 30, 2020, the Corporation executed restructuring activities across all of its segments to support its ongoing effort of improving capacity utilization and operating efficiency. These restructuring activities, which include workforce reductions and consolidation of facilities, resulted in $11 million and $29 million of pre-tax charges for the three and nine months ended September 30, 2020. Pre-tax restructuring charges for the year ending December 31, 2020 are expected to be $35 million. The Company anticipates that these actions, which are expected to be substantially completed by the end of 2020, will result in total cost savings of approximate ly $40 million ann ually. The following tables summarize the respective accrual balances related to these restructuring activities: In thousands Restructuring Accrual as of December 31, 2019 Provision Cash Payments Restructuring Accrual as of September 30, 2020 Commercial/Industrial Severance $ — $ 9,028 $ (3,939) $ 5,089 Facility closure and other exit costs — 2,496 (2,147) 349 Total Commercial/Industrial $ — $ 11,524 $ (6,086) $ 5,438 Defense Severance $ — $ 3,015 $ (2,576) $ 439 Facility closure and other exit costs — 41 (41) — Total Defense $ — $ 3,056 $ (2,617) $ 439 Power Severance $ — $ 3,001 $ (1,263) $ 1,738 Facility closure and other exit costs — 710 (710) — Total Power $ — $ 3,711 $ (1,973) $ 1,738 Consolidated Severance $ — $ 15,044 $ (7,778) $ 7,266 Facility closure and other exit costs — 3,247 (2,898) 349 Total consolidated $ — $ 18,291 $ (10,676) $ 7,615 A reconciliation of total pre-tax restructuring charges is as follows: Affected line item in the Condensed Consolidated Statement of Earnings Three Months Ended Nine Months Ended (In thousands) September 30, 2020 September 30, 2020 Inventory write-downs Cost of product sales $ 2,625 $ 7,815 Severance, facility closure, and other exit costs Restructuring expenses 7,690 18,291 Property, plant, and equipment & operating lease right of use asset impairments Restructuring expenses 851 2,439 $ 8,541 $ 20,730 Total restructuring charges Earnings before income taxes $ 11,166 $ 28,545 There were no such comparable charges for the three and nine months ended September 30, 2019. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTSOn September 24, 2020, the Corporation entered into an agreement to acquire the stock of Pacific Star Communications, Inc. (PacStar) for $400Â million. PacStar is a provider of tactical communications solutions for battlefield network management. For the year ending December 31, 2020, PacStar is expected to generate sales in excess of $120Â million. The transaction is anticipated to close in the fourth quarter, and is subject to customary closing conditions. Upon close, the acquired business will operate within the Defense segment. In October 2020, the Corporation announced that its Board of Directors has authorized an additional $200Â million for future share repurchases, increasing total available authorization to $250Â million. The Corporation intends to use $50Â million of the available authorization for opportunistic share repurchases through the remainder of the year. The Corporation had previously completed a $100Â million opportunistic share repurchase program executed in March 2020 and expects to complete its existing $50Â million 10b5-1 share repurchase program authorized for 2020 by the end of the year. |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis Of Accounting | Curtiss-Wright Corporation and its subsidiaries (the "Corporation" or the "Company") is a global, diversified manufacturing and service company that designs, manufactures, and overhauls precision components and provides highly engineered products and services to the aerospace, defense, power generation, and general industrial markets. The unaudited condensed consolidated financial statements include the accounts of Curtiss-Wright and its majority-owned subsidiaries. All intercompany transactions and accounts have been eliminated. The unaudited condensed consolidated financial statements of the Corporation have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in annual financial statements have been condensed or omitted as permitted by such rules and regulations. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments necessary for a fair presentation of these financial statements. Management is required to make estimates and judgments that affect the reported amount of assets, liabilities, revenue, and expenses and disclosure of contingent assets and liabilities in the accompanying financial statements. Actual results may differ from these estimates. The most significant of these estimates includes the estimate of costs to complete on contracts using the over-time revenue recognition accounting method, cash flow estimates used for testing the recoverability of assets, pension plan and postretirement obligation assumptions, estimates for inventory obsolescence, fair value estimates around assets and assumed liabilities from acquisitions, estimates for the valuation and useful lives of intangible assets, legal reserves, and the estimate of future environmental costs. Changes in estimates of contract sales, costs, and profits are recognized using the cumulative catch-up method of accounting. This method recognizes in the current period the cumulative effect of the changes on current and prior periods. Accordingly, the effect of the changes on future periods of contract performance is recognized as if the revised estimate had been the original estimate. During the three and nine months ended September 30, 2020 and 2019, there were no significant changes in estimated contract costs. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Corporation’s 2019 Annual Report on Form 10-K. The results of operations for interim periods are not necessarily indicative of trends or of the operating results for a full year. On January 1, 2020, the Corporation implemented an organizational change to align its reportable segments more closely with its current business structure. This change resulted in the transfer of two business units, one from the Commercial/Industrial segment to the Defense segment and the other from the Defense segment to the Power segment. While this organizational change resulted in the recasting of previously reported amounts across all reportable segments, it did not impact the Corporation’s previously reported consolidated financial statements. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent accounting pronouncements adopted A SU 2016-13 -Financial Instruments—Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments . On January 1, 2020, the Company adopted ASU 2016-13 -Financial Instruments—Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments . This ASU added a current expected credit loss impairment model to U.S. GAAP based on expected losses rather than incurred losses. As the Corporation is not subject to material trade credit risk given that a significant portion of its sales are generated from contracts with agencies of or prime contractors to the U.S. Government , the adoption of this standard did not result in any impact to its allowance for doubtful accounts balance as of January 1, 2020. As a result of adoption, the Corporation utilizes current and historical collection data as well as assess current economic conditions in order to determine expected trade credit losses on a prospective basis. |
REVENUE (Tables)
REVENUE (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table illustrates the approximate percentage of revenue recognized for performance obligations satisfied over-time versus at a point-in-time for the three and nine months ended September 30, 2020 and 2019: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Over-time 50 % 47 % 52 % 48 % Point-in-time 50 % 53 % 48 % 52 % The following table presents the Corporation’s total net sales disaggregated by end market and customer type: Total Net Sales by End Market & Customer Type Three Months Ended Nine Months Ended September 30, September 30, (In thousands) 2020 2019 2020 2019 Defense Aerospace $ 121,987 $ 110,742 $ 333,120 $ 293,955 Ground 20,519 22,231 63,205 69,383 Naval 165,524 143,430 496,157 424,371 Total Defense Customers $ 308,030 $ 276,403 $ 892,482 $ 787,709 Commercial Aerospace $ 70,943 $ 109,015 $ 242,708 $ 320,237 Power Generation 80,509 88,543 241,059 278,194 General Industrial 112,132 140,919 346,643 446,050 Total Commercial Customers $ 263,584 $ 338,477 $ 830,410 $ 1,044,481 Total $ 571,614 $ 614,880 $ 1,722,892 $ 1,832,190 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition [Table Text Block] | (In thousands) 2020 2019 Accounts receivable $ 3,204 $ 2,300 Inventory 10,233 322 Property, plant, and equipment 1,332 648 Other current and non-current assets 188 479 Intangible assets 39,384 26,000 Operating lease right-of-use assets, net 1,992 1,393 Current and non-current liabilities (10,590) (3,252) Net tangible and intangible assets 45,743 27,890 Goodwill 43,912 22,185 Total purchase price $ 89,655 $ 50,075 Cash paid to date, net of cash acquired $ 82,053 $ 50,075 Due to seller 7,602 — Total purchase price $ 89,655 $ 50,075 Goodwill deductible for tax purposes $ 38,519 $ 22,635 |
RECEIVABLES (Table)
RECEIVABLES (Table) | 9 Months Ended |
Sep. 30, 2020 | |
Receivables [Abstract] | |
Schedule Of Accounts Notes Loans And Financing Receivable | The composition of receivables is as follows: (In thousands) September 30, 2020 December 31, 2019 Billed receivables: Trade and other receivables $ 386,098 $ 418,968 Less: Allowance for doubtful accounts (8,755) (8,733) Net billed receivables 377,343 410,235 Unbilled receivables (contract assets): Recoverable costs and estimated earnings not billed 264,807 231,067 Less: Progress payments applied (7,206) (9,108) Net unbilled receivables 257,601 221,959 Receivables, net $ 634,944 $ 632,194 |
INVENTORIES (Table)
INVENTORIES (Table) | 9 Months Ended |
Sep. 30, 2020 | |
Inventory, Net [Abstract] | |
Schedule Of Inventory | (In thousands) September 30, 2020 December 31, 2019 Raw materials $ 177,729 $ 153,876 Work-in-process 100,710 100,359 Finished goods 130,942 108,329 Inventoried costs related to U.S. Government and other long-term contracts (1) 58,630 70,414 Inventories, net of reserves 468,011 432,978 Less: Progress payments applied (7,426) (8,143) Inventories, net $ 460,585 $ 424,835 |
GOODWILL (Table)
GOODWILL (Table) | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill [Abstract] | |
Schedule Of Goodwill | The changes in the carrying amount of goodwill for the nine months ended September 30, 2020 are as follows: (In thousands) Commercial/Industrial Defense Power Consolidated December 31, 2019 $ 431,082 $ 526,955 $ 208,643 $ 1,166,680 Acquisitions 29,233 14,679 — 43,912 Adjustments — (1,386) — (1,386) Foreign currency translation adjustment (372) (536) (417) (1,325) September 30, 2020 $ 459,943 $ 539,712 $ 208,226 $ 1,207,881 |
OTHER INTANGIBLE ASSETS, NET (T
OTHER INTANGIBLE ASSETS, NET (Table) | 9 Months Ended |
Sep. 30, 2020 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule Of Intangible Assets By Major Class | The following tables present the cumulative composition of the Corporation’s intangible assets: September 30, 2020 December 31, 2019 (In thousands) Gross Accumulated Amortization Net Gross Accumulated Amortization Net Technology $ 265,241 $ (150,363) $ 114,878 $ 257,676 $ (140,390) $ 117,286 Customer related intangibles 463,186 (239,688) 223,498 434,492 (215,855) 218,637 Programs (1) 144,000 (18,000) 126,000 144,000 (12,600) 131,400 Other intangible assets 46,267 (33,779) 12,488 43,729 (31,145) 12,584 Total $ 918,694 $ (441,830) $ 476,864 $ 879,897 $ (399,990) $ 479,907 |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Table) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Derivatives Not Designated as Hedging Instruments [Table Text Block] | Undesignated hedges For the three and nine months ended September 30, 2020 and 2019, the gains or (losses) recognized in income on forward exchange derivative contracts not designated for hedge accounting were as follows: Three Months Ended Nine Months Ended (In thousands) September 30, September 30, Derivatives not designated as hedging instrument 2020 2019 2020 2019 Forward exchange contracts: General and administrative expenses $ 1,730 $ (1,823) $ (5,702) $ (392) |
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments [Table Text Block] | September 30, 2020 December 31, 2019 (In thousands) Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value 3.84% Senior notes due 2021 100,000 102,447 100,000 102,079 3.70% Senior notes due 2023 202,500 211,571 202,500 207,882 3.85% Senior notes due 2025 90,000 97,021 90,000 93,838 4.24% Senior notes due 2026 200,000 223,547 200,000 213,126 4.05% Senior notes due 2028 67,500 75,258 67,500 71,260 4.11% Senior notes due 2028 90,000 100,825 90,000 95,607 3.10% Senior notes due 2030 150,000 155,387 — — 3.20% Senior notes due 2032 150,000 154,622 — — Total debt 1,050,000 1,120,678 750,000 783,792 Debt issuance costs, net (1,180) (1,180) (594) (594) Unamortized interest rate swap proceeds 9,887 9,887 11,233 11,233 Total debt, net $ 1,058,707 $ 1,129,385 $ 760,639 $ 794,431 |
PENSION AND OTHER POSTRETIREM_2
PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS (Table) | 9 Months Ended |
Sep. 30, 2020 | |
Pension Plans Defined Benefit [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule Of Defined Benefit Plans Disclosures | The components of net periodic pension cost for the three and nine months ended September 30, 2020 and 2019 were as follows: Three Months Ended Nine Months Ended September 30, September 30, (In thousands) 2020 2019 2020 2019 Service cost $ 6,285 $ 6,096 $ 19,507 $ 17,747 Interest cost 5,772 7,045 17,888 21,788 Expected return on plan assets (16,602) (14,645) (50,394) (44,411) Amortization of prior service cost 178 170 36 29 Amortization of unrecognized actuarial loss 5,539 1,557 17,038 6,741 Net periodic pension cost $ 1,172 $ 223 $ 4,075 $ 1,894 |
EARNINGS PER SHARE (Table)
EARNINGS PER SHARE (Table) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share Reconciliation | A reconciliation of basic to diluted shares used in the earnings per share calculation is as follows: Three Months Ended Nine Months Ended September 30, September 30, (In thousands) 2020 2019 2020 2019 Basic weighted-average shares outstanding 41,545 42,709 41,926 42,755 Dilutive effect of stock options and deferred stock compensation 252 286 264 270 Diluted weighted-average shares outstanding 41,797 42,995 42,190 43,025 |
SEGMENT INFORMATION (Table)
SEGMENT INFORMATION (Table) | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Schedule Of Segment Reporting Information By Segment | Three Months Ended Nine Months Ended September 30, September 30, (In thousands) 2020 2019 2020 2019 Net sales Commercial/Industrial $ 222,734 $ 279,064 $ 701,048 $ 842,373 Defense 180,355 160,445 516,531 452,983 Power 168,976 176,162 506,664 539,616 Less: Intersegment revenues (451) (791) (1,351) (2,782) Total consolidated $ 571,614 $ 614,880 $ 1,722,892 $ 1,832,190 Operating income (expense) Commercial/Industrial $ 24,838 $ 43,641 $ 74,191 $ 130,222 Defense 41,550 40,241 98,126 93,580 Power 25,962 28,776 67,843 86,140 Corporate and eliminations (1) (7,777) (7,089) (27,792) (26,643) Total consolidated $ 84,573 $ 105,569 $ 212,368 $ 283,299 (1) Corporate and eliminations includes service costs related to pension and other postretirement benefits, certain environmental costs related to remediation at legacy sites, foreign currency transactional gains and losses, and certain other expenses. |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | Three Months Ended Nine Months Ended September 30, September 30, (In thousands) 2020 2019 2020 2019 Total operating income $ 84,573 $ 105,569 $ 212,368 $ 283,299 Interest expense 9,055 7,951 25,059 23,183 Other income, net 5,417 6,355 6,844 17,704 Earnings before income taxes $ 80,935 $ 103,973 $ 194,153 $ 277,820 |
Reconciliation Of Assets From Segment To Consolidated | (In thousands) September 30, 2020 December 31, 2019 Identifiable assets Commercial/Industrial $ 1,391,570 $ 1,363,592 Defense 1,242,648 1,209,706 Power 875,745 885,727 Corporate and Other 449,817 305,236 Total consolidated $ 3,959,780 $ 3,764,261 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Table) | 9 Months Ended |
Sep. 30, 2020 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Comprehensive Income (Loss) | The cumulative balance of each component of accumulated other comprehensive income (AOCI), net of tax, is as follows: (In thousands) Foreign currency translation adjustments, net Total pension and postretirement adjustments, net Accumulated other comprehensive income (loss) December 31, 2018 $ (147,148) $ (141,299) $ (288,447) Other comprehensive income (loss) before reclassifications 18,447 (35,212) (16,765) Amounts reclassified from accumulated other comprehensive loss — 6,195 6,195 Net current period other comprehensive loss 18,447 (29,017) (10,570) Cumulative effect from adoption of ASU 2018-02 $ (1,318) $ (24,939) $ (26,257) December 31, 2019 $ (130,019) $ (195,255) $ (325,274) Other comprehensive income (loss) before reclassifications 2,139 (339) 1,800 Amounts reclassified from accumulated other comprehensive income — 12,583 12,583 Net current period other comprehensive income 2,139 12,244 14,383 September 30, 2020 $ (127,880) $ (183,011) $ (310,891) |
Reclassification out of Accumulated Other Comprehensive Income | Details of amounts reclassified from accumulated other comprehensive income (loss) are below: (In thousands) Amount reclassified from AOCI Affected line item in the Condensed Consolidated Statement of Earnings Defined benefit pension and other postretirement benefit plans Amortization of prior service costs $ 457 Other income, net Amortization of actuarial losses (17,034) Other income, net (16,577) Earnings before income taxes 3,994 Provision for income taxes Total reclassifications $ (12,583) Net earnings |
RESTRUCTURING COSTS (Tables)
RESTRUCTURING COSTS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | The following tables summarize the respective accrual balances related to these restructuring activities: In thousands Restructuring Accrual as of December 31, 2019 Provision Cash Payments Restructuring Accrual as of September 30, 2020 Commercial/Industrial Severance $ — $ 9,028 $ (3,939) $ 5,089 Facility closure and other exit costs — 2,496 (2,147) 349 Total Commercial/Industrial $ — $ 11,524 $ (6,086) $ 5,438 Defense Severance $ — $ 3,015 $ (2,576) $ 439 Facility closure and other exit costs — 41 (41) — Total Defense $ — $ 3,056 $ (2,617) $ 439 Power Severance $ — $ 3,001 $ (1,263) $ 1,738 Facility closure and other exit costs — 710 (710) — Total Power $ — $ 3,711 $ (1,973) $ 1,738 Consolidated Severance $ — $ 15,044 $ (7,778) $ 7,266 Facility closure and other exit costs — 3,247 (2,898) 349 Total consolidated $ — $ 18,291 $ (10,676) $ 7,615 A reconciliation of total pre-tax restructuring charges is as follows: Affected line item in the Condensed Consolidated Statement of Earnings Three Months Ended Nine Months Ended (In thousands) September 30, 2020 September 30, 2020 Inventory write-downs Cost of product sales $ 2,625 $ 7,815 Severance, facility closure, and other exit costs Restructuring expenses 7,690 18,291 Property, plant, and equipment & operating lease right of use asset impairments Restructuring expenses 851 2,439 $ 8,541 $ 20,730 Total restructuring charges Earnings before income taxes $ 11,166 $ 28,545 |
REVENUE DISAGGREGATION OF REVEN
REVENUE DISAGGREGATION OF REVENUE (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 571,614 | $ 614,880 | $ 1,722,892 | $ 1,832,190 |
Defense [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 308,030 | 276,403 | 892,482 | 787,709 |
Commercial [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 263,584 | 338,477 | 830,410 | 1,044,481 |
Defense Aerospace [Member] | Defense [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 121,987 | 110,742 | 333,120 | 293,955 |
Defense Ground [Member] | Defense [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 20,519 | 22,231 | 63,205 | 69,383 |
Naval [Member] | Defense [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 165,524 | 143,430 | 496,157 | 424,371 |
Commercial Aerospace [Member] | Commercial [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 70,943 | 109,015 | 242,708 | 320,237 |
Power Generation [Member] | Commercial [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 80,509 | 88,543 | 241,059 | 278,194 |
General Industrial [Member] | Commercial [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 112,132 | $ 140,919 | $ 346,643 | $ 446,050 |
Transferred over Time [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net Sales, Net, Percent | 50.00% | 47.00% | 52.00% | 48.00% |
Transferred at Point in Time [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net Sales, Net, Percent | 50.00% | 53.00% | 48.00% | 52.00% |
REVENUE ADDITIONAL DETAILS (Det
REVENUE ADDITIONAL DETAILS (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | ||||
Contract with Customer, Liability, Revenue Recognized | $ 37 | $ 26 | $ 197 | $ 159 |
Revenue, Remaining Performance Obligation, Amount | $ 2,200 | $ 2,200 | ||
Revenue, Remaining Performance Obligation, Percentage | 90.00% | 90.00% | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Explanation | 12-36 months |
ACQUISITIONS (Details)
ACQUISITIONS (Details) - USD ($) $ in Thousands | Sep. 24, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 1,207,881 | $ 1,166,680 | ||
Acquisition of businesses, net of cash acquired | 82,053 | $ 50,075 | ||
Business Combination, Consideration Transferred | $ 400,000 | |||
2019 acquisitions [Member] | ||||
Business Acquisition [Line Items] | ||||
Accounts Receivable | 2,300 | |||
Inventory | 322 | |||
Property, Plant, and Equipment | 648 | |||
Other Current and Non-current Assets | 479 | |||
Intangible Assets, Other than Goodwill | 26,000 | |||
Right of Use Assets | 1,393 | |||
Current and Non-current Liabilities | (3,252) | |||
Net Tangible Assets Acquired (Liabilities) Assumed | 27,890 | |||
Goodwill | 22,185 | |||
Net Tangible and Intangible Assets | 50,075 | |||
Acquisition of businesses, net of cash acquired | 50,075 | |||
Business Combination, Consideration Transferred | 50,075 | |||
Goodwill, Expected Tax Deductible Amount | $ 22,635 | |||
2020 acquisitions [Member] | ||||
Business Acquisition [Line Items] | ||||
Accounts Receivable | 3,204 | |||
Inventory | 10,233 | |||
Property, Plant, and Equipment | 1,332 | |||
Other Current and Non-current Assets | 188 | |||
Intangible Assets, Other than Goodwill | 39,384 | |||
Right of Use Assets | 1,992 | |||
Current and Non-current Liabilities | (10,590) | |||
Net Tangible Assets Acquired (Liabilities) Assumed | 45,743 | |||
Goodwill | 43,912 | |||
Net Tangible and Intangible Assets | 89,655 | |||
Cash paid to date, net of cash acquired | 82,053 | |||
Payments To Acquire Business, Remaining To Be Paid | 7,602 | |||
Business Combination, Consideration Transferred | 89,655 | |||
Goodwill, Expected Tax Deductible Amount | $ 38,519 |
ACQUISITIONS Narrative (Details
ACQUISITIONS Narrative (Details) $ in Thousands | Apr. 20, 2020 | Feb. 26, 2020 | Mar. 15, 2019 | Sep. 30, 2020USD ($)NumberAcquisitions | Sep. 30, 2019USD ($)NumberAcquisitions |
Business Acquisition [Line Items] | |||||
Number of Businesses Acquired | NumberAcquisitions | 2 | 1 | |||
Revenue of Acquiree since Acquisition Date, Actual | $ 12,000 | $ 8,000 | |||
Earnings or Loss of Acquiree since Acquisition Date, Actual | (1,000) | ||||
Acquisition of businesses, net of cash acquired | 82,053 | 50,075 | |||
2019 acquisitions [Member] | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | 50,075 | ||||
Acquisition of businesses, net of cash acquired | 50,075 | ||||
Defense [Member] | Tactical Communications Group (TCG) [Member] | |||||
Business Acquisition [Line Items] | |||||
Effective Date of Acquisition | Mar. 15, 2019 | ||||
Acquisition of businesses, net of cash acquired | $ 50,000 | ||||
Defense [Member] | Integrated Air Defense System (IADS) [Member] | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | 29,000 | ||||
Effective Date of Acquisition | Apr. 20, 2020 | ||||
Commercial Industrial [Member] | Dyna-Flo Valve Services Ltd. (Dyna-Flo) [Member] | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | $ 60,000 | ||||
Effective Date of Acquisition | Feb. 26, 2020 |
RECEIVABLES (Detail)
RECEIVABLES (Detail) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Billed receivables: | ||
Trade and other receivables | $ 386,098 | $ 418,968 |
Less: Allowance for doubtful accounts | (8,755) | (8,733) |
Net billed receivables | 377,343 | 410,235 |
Unbilled receivables: | ||
Recoverable costs and estimated earnings not billed | 264,807 | 231,067 |
Less: Progress payments applied | (7,206) | (9,108) |
Net unbilled receivables | 257,601 | 221,959 |
Receivables, net | $ 634,944 | $ 632,194 |
INVENTORIES (Detail)
INVENTORIES (Detail) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Inventory, Net [Abstract] | ||
Inventory, Raw Materials, Net of Reserves | $ 177,729 | $ 153,876 |
Inventory, Work in Process, Net of Reserves | 100,710 | 100,359 |
Inventory, Finished Goods, Net of Reserves | 130,942 | 108,329 |
Inventory For Long-term Contracts Or Programs, Net Of Reserves | 58,630 | 70,414 |
Inventories, Net of Reserves | 468,011 | 432,978 |
Less:Â Â Progress payments applied | (7,426) | (8,143) |
Inventories, net | $ 460,585 | $ 424,835 |
INVENTORIES (Narrative) (Detail
INVENTORIES (Narrative) (Detail) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Inventory, Net [Abstract] | ||
Other inventory, capitalized costs | $ 30.9 | $ 39.1 |
Other Inventory Capitalized Costs Not Supported By Existing Firm Orders | $ 16.1 | $ 23.7 |
GOODWILL (Detail)
GOODWILL (Detail) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Goodwill [Roll Forward] | |
December 31, 2019 | $ 1,166,680 |
Goodwill, Acquired During Period | 43,912 |
Goodwill, Other Increase (Decrease) | (1,386) |
Foreign currency translation adjustment | (1,325) |
September 30, 2020 | 1,207,881 |
Commercial Industrial [Member] | |
Goodwill [Roll Forward] | |
December 31, 2019 | 431,082 |
Goodwill, Acquired During Period | 29,233 |
Foreign currency translation adjustment | (372) |
September 30, 2020 | 459,943 |
Defense [Member] | |
Goodwill [Roll Forward] | |
December 31, 2019 | 526,955 |
Goodwill, Acquired During Period | 14,679 |
Goodwill, Other Increase (Decrease) | (1,386) |
Foreign currency translation adjustment | (536) |
September 30, 2020 | 539,712 |
Power [Member] | |
Goodwill [Roll Forward] | |
December 31, 2019 | 208,643 |
Foreign currency translation adjustment | (417) |
September 30, 2020 | $ 208,226 |
OTHER INTANGIBLE ASSETS, NET (D
OTHER INTANGIBLE ASSETS, NET (Detail) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Finite Lived Intangible Assets [Line Items] | ||
Gross | $ 918,694 | $ 879,897 |
Accumulated Amortization | (441,830) | (399,990) |
Net | 476,864 | 479,907 |
Technology [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross | 265,241 | 257,676 |
Accumulated Amortization | (150,363) | (140,390) |
Net | 114,878 | 117,286 |
Customer Relationships [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross | 463,186 | 434,492 |
Accumulated Amortization | (239,688) | (215,855) |
Net | 223,498 | 218,637 |
Contract and Program Intangible Assets [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross | 144,000 | 144,000 |
Accumulated Amortization | (18,000) | (12,600) |
Net | 126,000 | 131,400 |
Other Intangible Assets [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross | 46,267 | 43,729 |
Accumulated Amortization | (33,779) | (31,145) |
Net | $ 12,488 | $ 12,584 |
OTHER INTANGIBLE ASSETS, NET (N
OTHER INTANGIBLE ASSETS, NET (Narrative) (Detail) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Finite Lived Intangible Assets [Line Items] | ||
Finite-lived Intangible Assets Acquired | $ 39.4 | |
Amortization expense | 43.3 | $ 33.9 |
Future amortization expense in remainder of fiscal year | 58 | |
Future amortization expense in year one | 48 | |
Future amortization expense in year two | 45 | |
Future amortization expense in year three | 42 | |
Future amortization expense in year four | 38 | |
Technology [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Finite-lived Intangible Assets Acquired | $ 8.1 | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 15 years | |
Customer Relationships [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Finite-lived Intangible Assets Acquired | $ 28.9 | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 19 years 4 months 24 days | |
Other Intangible Assets [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Finite-lived Intangible Assets Acquired | $ 2.4 | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 7 years 6 months |
FAIR VALUE OF FINANCIAL INSTR_3
FAIR VALUE OF FINANCIAL INSTRUMENTS (Income Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
General and Administrative Expense [Member] | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain (Loss) on Foreign Currency Derivative Instruments Not Designated as Hedging Instruments | $ 1,730 | $ (1,823) | $ (5,702) | $ (392) |
FAIR VALUE OF FINANCIAL INSTR_4
FAIR VALUE OF FINANCIAL INSTRUMENTS (Debt) (Detail) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying Value | $ 1,058,707 | $ 760,639 |
Estimated Fair Value | 1,129,385 | 794,431 |
Long-term Debt, Gross | 1,050,000 | 750,000 |
Debt Issuance Costs, Net | (1,180) | (594) |
Deferred Gain (Loss) on Discontinuation of Interest Rate Fair Value Hedge | 9,887 | 11,233 |
3.84% Senior notes due 2021 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying Value | 100,000 | 100,000 |
Estimated Fair Value | $ 102,447 | 102,079 |
Debt Instrument, Interest Rate, Stated Percentage | 3.84% | |
3.70% Senior notes due 2023 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying Value | $ 202,500 | 202,500 |
Estimated Fair Value | $ 211,571 | 207,882 |
Debt Instrument, Interest Rate, Stated Percentage | 3.70% | |
3.85% Senior notes due 2025 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying Value | $ 90,000 | 90,000 |
Estimated Fair Value | $ 97,021 | 93,838 |
Debt Instrument, Interest Rate, Stated Percentage | 3.85% | |
4.24% Senior notes due 2026 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying Value | $ 200,000 | 200,000 |
Estimated Fair Value | $ 223,547 | 213,126 |
Debt Instrument, Interest Rate, Stated Percentage | 4.24% | |
4.05% Senior notes due 2028 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying Value | $ 67,500 | 67,500 |
Estimated Fair Value | $ 75,258 | 71,260 |
Debt Instrument, Interest Rate, Stated Percentage | 4.05% | |
4.11% Senior Notes due 2028 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying Value | $ 90,000 | 90,000 |
Estimated Fair Value | $ 100,825 | 95,607 |
Debt Instrument, Interest Rate, Stated Percentage | 4.11% | |
3.10% Senior Notes due 2030 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying Value | $ 150,000 | 0 |
Estimated Fair Value | $ 155,387 | 0 |
Debt Instrument, Interest Rate, Stated Percentage | 3.10% | |
3.20% Senior Notes due 2032 [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying Value | $ 150,000 | 0 |
Estimated Fair Value | $ 154,622 | 0 |
Debt Instrument, Interest Rate, Stated Percentage | 3.20% | |
Long-term Debt, gross [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Estimated Fair Value | $ 1,120,678 | $ 783,792 |
PENSION AND OTHER POSTRETIREM_3
PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS (Detail) - Pension Plans Defined Benefit [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 6,285 | $ 6,096 | $ 19,507 | $ 17,747 |
Interest cost | 5,772 | 7,045 | 17,888 | 21,788 |
Expected return on plan assets | (16,602) | (14,645) | (50,394) | (44,411) |
Amortization of prior service cost | 178 | 170 | 36 | 29 |
Amortization of unrecognized actuarial loss | 5,539 | 1,557 | 17,038 | 6,741 |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Total | $ 1,172 | $ 223 | 4,075 | $ 1,894 |
Defined Benefit Plan, Plan Assets, Contributions by Employer | $ 150,000 |
PENSION AND OTHER POSTRETIREM_4
PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS (Additional) (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2020 | |
Defined Contribution Plan Disclosure [Line Items] | |||||
Defined Contribution Plan, Employer Contribution, Percentage, Maximum | 7.00% | ||||
Defined Contribution Plan, Cost | $ 4.5 | $ 4.2 | $ 14.8 | $ 13.8 | |
Defined Contribution Plan, Employer Discretionary Contribution Amount | $ 16.5 | ||||
Forecast [Member] | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
Defined Contribution Plan, Employer Discretionary Contribution Amount | $ 18.3 |
EARNINGS PER SHARE (Detail)
EARNINGS PER SHARE (Detail) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings Per Share Reconciliation [Abstract] | ||||
Basic weighted-average shares outstanding (shares) | 41,545 | 42,709 | 41,926 | 42,755 |
Dilutive effect of stock options and deferred stock compensation (shares) | 252 | 286 | 264 | 270 |
Diluted weighted-average shares outstanding (shares) | 41,797 | 42,995 | 42,190 | 43,025 |
EARNINGS PER SHARE EARNINGS PER
EARNINGS PER SHARE EARNINGS PER SHARE (Anti-dilutive) (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 0 | 0 | 0 |
SEGMENT INFORMATION (Detail)
SEGMENT INFORMATION (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | |||||
Net sales | $ 571,614 | $ 614,880 | $ 1,722,892 | $ 1,832,190 | |
Operating income (expense) | 84,573 | 105,569 | 212,368 | 283,299 | |
Identifiable assets | 3,959,780 | 3,959,780 | $ 3,764,261 | ||
Commercial Industrial [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 222,734 | 279,064 | 701,048 | 842,373 | |
Operating income (expense) | 24,838 | 43,641 | 74,191 | 130,222 | |
Identifiable assets | 1,391,570 | 1,391,570 | 1,363,592 | ||
Defense [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 180,355 | 160,445 | 516,531 | 452,983 | |
Operating income (expense) | 41,550 | 40,241 | 98,126 | 93,580 | |
Identifiable assets | 1,242,648 | 1,242,648 | 1,209,706 | ||
Power [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 168,976 | 176,162 | 506,664 | 539,616 | |
Operating income (expense) | 25,962 | 28,776 | 67,843 | 86,140 | |
Identifiable assets | 875,745 | 875,745 | 885,727 | ||
Corporate, Non-Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating income (expense) | (7,777) | (7,089) | (27,792) | (26,643) | |
Identifiable assets | 449,817 | 449,817 | $ 305,236 | ||
Intersegment Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | $ (451) | $ (791) | $ (1,351) | $ (2,782) |
SEGMENT INFORMATION (Reconcilia
SEGMENT INFORMATION (Reconciliation) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting [Abstract] | ||||
Total operating income | $ 84,573 | $ 105,569 | $ 212,368 | $ 283,299 |
Interest expense | (9,055) | (7,951) | (25,059) | (23,183) |
Other income, net | 5,417 | 6,355 | 6,844 | 17,704 |
Earnings before income taxes | $ 80,935 | $ 103,973 | $ 194,153 | $ 277,820 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||
Beginning balance | $ (325,274) | $ (288,447) | $ (288,447) | ||
Other comprehensive income (loss) before reclassifications | 1,800 | (16,765) | |||
Amounts reclassified from accumulated other comprehensive loss | 12,583 | 6,195 | |||
Other comprehensive income (loss), net of tax | $ 31,790 | $ (23,423) | 14,383 | (11,209) | (10,570) |
Ending balance | (310,891) | (310,891) | (325,274) | ||
Foreign Currency Translation Adjustments, Net [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||
Beginning balance | (130,019) | (147,148) | (147,148) | ||
Other comprehensive income (loss) before reclassifications | 2,139 | 18,447 | |||
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 | |||
Other comprehensive income (loss), net of tax | 2,139 | 18,447 | |||
Ending balance | (127,880) | (127,880) | (130,019) | ||
Total Pension and Postretirment Adjustments, Net [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||
Beginning balance | (195,255) | $ (141,299) | (141,299) | ||
Other comprehensive income (loss) before reclassifications | (339) | (35,212) | |||
Amounts reclassified from accumulated other comprehensive loss | 12,583 | 6,195 | |||
Other comprehensive income (loss), net of tax | 12,244 | (29,017) | |||
Ending balance | $ (183,011) | (183,011) | (195,255) | ||
Accounting Standards Update 2018-02 [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||
Beginning balance | (26,257) | ||||
Ending balance | (26,257) | ||||
Accounting Standards Update 2018-02 [Member] | Foreign Currency Translation Adjustments, Net [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||
Beginning balance | (1,318) | ||||
Ending balance | (1,318) | ||||
Accounting Standards Update 2018-02 [Member] | Total Pension and Postretirment Adjustments, Net [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||
Beginning balance | $ (24,939) | ||||
Ending balance | $ (24,939) |
ACCUMULATED OTHER COMPREHENSI_4
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Reclass) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Earnings from continuing operations before income taxes | $ 80,935 | $ 103,973 | $ 194,153 | $ 277,820 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Total Pension and Postretirment Adjustments, Net [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Amortization of prior service costs | 457 | |||
Amortization of actuarial losses | (17,034) | |||
Earnings from continuing operations before income taxes | (16,577) | |||
Provision for income taxes | 3,994 | |||
Net earnings | $ (12,583) |
CONTINGENCIES AND COMMITMENTS (
CONTINGENCIES AND COMMITMENTS (Detail) - USD ($) | Oct. 10, 2013 | Sep. 30, 2020 | Dec. 31, 2019 |
Standby Letters Of Credit [Member] | |||
Loss Contingencies [Line Items] | |||
Letters of credit, outstanding | $ 21,900,000 | $ 32,600,000 | |
FinancialStandbyLetterOfCreditMember | |||
Loss Contingencies [Line Items] | |||
Letters of credit, outstanding | 6,600,000 | $ 10,800,000 | |
Failure to Meet Contractual Obligations [Member] | |||
Loss Contingencies [Line Items] | |||
Damages sought | $ 25,000,000 | ||
Surety Bond [Member] | |||
Loss Contingencies [Line Items] | |||
Surety Bond Outstanding | 45,600,000 | ||
Minimum [Member] | |||
Loss Contingencies [Line Items] | |||
Range of possible loss | 0 | ||
Maximum [Member] | |||
Loss Contingencies [Line Items] | |||
Range of possible loss | 55,500,000 | ||
AP1000 US [Member] | Minimum [Member] | |||
Loss Contingencies [Line Items] | |||
Range of possible loss | 0 | ||
AP1000 US [Member] | Maximum [Member] | |||
Loss Contingencies [Line Items] | |||
Range of possible loss | $ 31,000,000 |
RESTRUCTURING COSTS - Narrative
RESTRUCTURING COSTS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2020 | Sep. 30, 2020 | |
Restructuring and Related Activities [Abstract] | ||
Restructuring Costs | $ 11,166 | $ 28,545 |
Expected cost through end of current year | 35,000 | |
Effect on future earnings | $ 40,000 |
RESTRUCTURING COSTS - Schedule
RESTRUCTURING COSTS - Schedule of Restructuring Accrual (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | $ 7,615 | $ 0 |
Increase (Decrease) in Restructuring Reserve | 18,291 | |
Payments for Restructuring | 10,676 | |
Commercial Industrial [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 5,438 | 0 |
Increase (Decrease) in Restructuring Reserve | 11,524 | |
Payments for Restructuring | 6,086 | |
Defense [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 439 | 0 |
Increase (Decrease) in Restructuring Reserve | 3,056 | |
Payments for Restructuring | 2,617 | |
Power [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 1,738 | 0 |
Increase (Decrease) in Restructuring Reserve | 3,711 | |
Payments for Restructuring | 1,973 | |
Employee Severance [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 7,266 | 0 |
Increase (Decrease) in Restructuring Reserve | 15,044 | |
Payments for Restructuring | 7,778 | |
Employee Severance [Member] | Commercial Industrial [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 5,089 | 0 |
Increase (Decrease) in Restructuring Reserve | 9,028 | |
Payments for Restructuring | 3,939 | |
Employee Severance [Member] | Defense [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 439 | 0 |
Increase (Decrease) in Restructuring Reserve | 3,015 | |
Payments for Restructuring | 2,576 | |
Employee Severance [Member] | Power [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 1,738 | 0 |
Increase (Decrease) in Restructuring Reserve | 3,001 | |
Payments for Restructuring | 1,263 | |
Facility Closing [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 349 | 0 |
Increase (Decrease) in Restructuring Reserve | 3,247 | |
Payments for Restructuring | 2,898 | |
Facility Closing [Member] | Commercial Industrial [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 349 | 0 |
Increase (Decrease) in Restructuring Reserve | 2,496 | |
Payments for Restructuring | 2,147 | |
Facility Closing [Member] | Defense [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 0 | 0 |
Increase (Decrease) in Restructuring Reserve | 41 | |
Payments for Restructuring | 41 | |
Facility Closing [Member] | Power [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 0 | $ 0 |
Increase (Decrease) in Restructuring Reserve | 710 | |
Payments for Restructuring | $ 710 |
RESTRUCTURING COSTS - Schedul_2
RESTRUCTURING COSTS - Schedule of Pre-tax Restructuring Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||||
Inventory Write-down | $ 2,625 | $ 7,815 | ||
Severance, Facility Closure, And Other Expenses | 7,690 | 18,291 | ||
Property, Plant And Equipment And Operating Lease Right Of Use Asset Impairments | 851 | 2,439 | ||
Restructuring Charges | 8,541 | $ 0 | 20,730 | $ 0 |
Restructuring Costs | $ 11,166 | $ 28,545 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | Sep. 24, 2020 | Oct. 29, 2020 | Mar. 31, 2020 |
Subsequent Event [Line Items] | |||
Purchase price agreement | $ 400 | ||
Business Combination, Expected Revenues | $ 120 | ||
10b5-1 Repurchase Program | |||
Subsequent Event [Line Items] | |||
Stock repurchase program, authorized amount | $ 100 | ||
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Stock repurchase program, increase In authorized amount | $ 200 | ||
Stock repurchase program, authorized amount | 250 | ||
Subsequent Event | 10b5-1 Repurchase Program | |||
Subsequent Event [Line Items] | |||
Stock repurchase program, authorized amount | $ 50 |
Uncategorized Items - cw-202009
Label | Element | Value |
Accounting Standards Update [Extensible List] | us-gaap_AccountingStandardsUpdateExtensibleList | Accounting Standards Update 2018-02 [Member] |