Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 28, 2022 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-35419 | |
Entity Registrant Name | KAMAN CORPORATION | |
Entity Incorporation, State or Country Code | CT | |
Entity Tax Identification Number | 06-0613548 | |
Entity Address, Address Line One | 1332 Blue Hills Avenue, | |
Entity Address, City or Town | Bloomfield, | |
Entity Address, State or Province | CT | |
Entity Address, Postal Zip Code | 06002 | |
City Area Code | (860) | |
Local Phone Number | 243-7100 | |
Title of 12(b) Security | Common Stock ($1 par value) | |
Trading Symbol | KAMN | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 28,018,895 | |
Entity Central Index Key | 0000054381 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 31,358 | $ 140,800 |
Accounts receivable, net | 102,477 | 73,524 |
Contract assets | 117,828 | 112,354 |
Contract costs, current portion | 822 | 850 |
Inventories | 221,815 | 193,100 |
Income tax refunds receivable | 15,865 | 13,832 |
Other current assets | 15,749 | 12,083 |
Total current assets | 505,914 | 546,543 |
Property, plant and equipment, net of accumulated depreciation of $260,640 and $251,888, respectively | 198,866 | 197,822 |
Operating Lease, Right-of-Use Asset | 7,523 | 11,011 |
Goodwill | 390,734 | 240,681 |
Other intangible assets, net | 385,478 | 138,074 |
Deferred income taxes | 15,711 | 15,717 |
Contract costs, noncurrent portion | 9,865 | 10,249 |
Equity Method Investments | 10,000 | |
Other assets | 40,443 | 38,385 |
Total assets | 1,564,534 | 1,198,482 |
Current liabilities: | ||
Accounts payable – trade | 37,267 | 42,134 |
Accrued salaries and wages | 31,952 | 38,892 |
Contract liabilities, current portion | 3,932 | 2,945 |
Operating Lease, Liability, Current | 3,633 | 4,502 |
Income taxes payable | 183 | 386 |
Other current liabilities | 38,404 | 32,076 |
Total current liabilities | 115,371 | 120,935 |
Long-term debt, excluding current portion, net of debt issuance costs | 609,800 | 189,421 |
Deferred income taxes | 6,194 | 6,506 |
Underfunded pension | 5,574 | 21,786 |
Contract liabilities, noncurrent portion | 20,477 | 16,528 |
Operating Lease, Liability, Noncurrent | 4,569 | 7,140 |
Other Liabilities, Noncurrent | 35,940 | 39,837 |
Commitments and contingencies (Note 15) | ||
Shareholders' equity: | ||
Preferred stock, $1 par value, 200,000 shares authorized; none outstanding | 0 | 0 |
Common stock, $1 par value, 50,000,000 shares authorized; voting; 30,620,003 and 30,434,269 shares issued, respectively | 30,620 | 30,434 |
Additional paid-in capital | 243,330 | 248,153 |
Retained earnings | 749,007 | 750,445 |
Accumulated other comprehensive income (loss) | (134,256) | (111,385) |
Less 2,604,564 and 2,573,896 shares of common stock, respectively, held in treasury, at cost | (122,092) | (121,318) |
Total shareholders’ equity | 766,609 | 796,329 |
Total liabilities and shareholders’ equity | 1,564,534 | 1,198,482 |
Equity Method Investments | 10,000 | |
Near Earth Autonomy | ||
Current assets: | ||
Equity Method Investments | 10,000 | 0 |
Equity Method Investments | $ 10,000 | $ 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
Income Statement [Abstract] | ||||
Net sales | $ 172,004 | $ 179,836 | $ 490,818 | $ 533,846 |
Cost of sales | 116,179 | 116,771 | 332,299 | 355,930 |
Gross profit | 55,825 | 63,065 | 158,519 | 177,916 |
Selling, general and administrative expenses | 49,009 | 39,335 | 127,980 | 116,182 |
Research and Development Expense | 3,937 | 2,540 | 14,265 | 10,004 |
Amortization of Intangible Assets | 3,118 | 2,624 | 8,024 | 7,898 |
Costs of Transaction Services Agreement | 0 | 24 | 0 | 1,728 |
Restructuring and severance costs | (243) | 2,611 | 2,853 | 5,479 |
Gain (Loss) on Disposition of Business | (457) | 0 | (457) | 234 |
Net loss (gain) on sale of assets | 15 | (31) | 71 | (16) |
Operating income | 446 | 15,962 | 5,783 | 36,407 |
Interest expense, net | 3,614 | 3,646 | 8,088 | 12,232 |
Non-service pension and post-retirement benefit income | (5,142) | (6,612) | (15,429) | (19,832) |
Income from Transaction Services Agreement | 0 | (14) | 0 | (931) |
Other expense (income), net | 1,221 | (172) | 2,415 | 275 |
Earnings before income taxes | 753 | 19,114 | 10,709 | 44,663 |
Income tax expense | 128 | 4,447 | 1,992 | 10,156 |
Net earnings | $ 625 | $ 14,667 | $ 8,717 | $ 34,507 |
Earnings per share: | ||||
Basic earnings per share (in usd per share) | $ 0.02 | $ 0.53 | $ 0.31 | $ 1.24 |
Diluted earnings per share (in usd per share) | $ 0.02 | $ 0.53 | $ 0.31 | $ 1.24 |
Average shares outstanding: | ||||
Basic (in shares) | 28,037 | 27,882 | 27,997 | 27,855 |
Diluted (in shares) | 28,088 | 27,888 | 28,076 | 27,889 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 625 | $ 14,667 | $ 8,717 | $ 34,507 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustments and other | (9,875) | (4,342) | (25,354) | 12,890 |
Change in pension and post-retirement benefit plan liabilities, net of tax expense of $259 and $257 and $756 and $773, respectively | 821 | 868 | 2,483 | 2,609 |
Other comprehensive (loss) income | (9,054) | (3,474) | (22,871) | 15,499 |
Comprehensive (loss) income | $ (8,429) | $ 11,193 | $ (14,154) | $ 50,006 |
Condensed Consolidated Statem_3
Condensed Consolidated Statement of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 24 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2022 | Oct. 01, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Cash Flows [Abstract] | |||||
Net earnings | $ 625 | $ 8,717 | $ 34,507 | ||
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: | |||||
Depreciation and amortization | 27,037 | 27,474 | |||
Amortization of debt issuance costs | 1,882 | 1,406 | |||
Accretion of convertible notes discount | 0 | 2,191 | |||
Provision for doubtful accounts | 619 | 373 | |||
Gain (Loss) on Disposition of Business | 457 | 457 | (234) | ||
Net loss (gain) on sale of assets | 15 | 71 | (16) | ||
Net loss on derivative instruments | 2,670 | 815 | |||
Stock compensation expense | 1,334 | 6,145 | 5,684 | ||
Non-cash consideration received for blade exchange | (827) | 0 | |||
Deferred income taxes | 1,600 | 4,822 | |||
Changes in assets and liabilities, excluding effects of acquisitions/divestitures: | |||||
Accounts receivable | (23,640) | 71,434 | |||
Increase (Decrease) in Contract with Customer, Asset | (5,405) | (19,940) | |||
Contract costs | 452 | (99) | |||
Inventories | (21,187) | (12,435) | |||
Income tax refunds receivable | (2,040) | 3,145 | |||
Operating Right-of-Use Assets | 3,347 | 1,739 | |||
Other assets | (3,682) | 1,042 | |||
Accounts payable - trade | (8,780) | (21,829) | |||
Contract liabilities | 4,246 | (24,036) | |||
Operating Lease Liabilities | (3,296) | (1,810) | |||
Payments for Retention Plans | 0 | (25,108) | |||
Other current liabilities | (4,591) | (2,698) | |||
Income taxes payable | (227) | 1,173 | |||
Pension liabilities | (13,309) | (29,256) | |||
Increase (Decrease) in Other Noncurrent Liabilities | (3,045) | (4,689) | |||
Net cash provided by operating activities | (33,700) | 14,123 | |||
Cash flows from investing activities: | |||||
Payments for (Proceeds from) Businesses and Interest in Affiliates | 1,200 | (3,428) | |||
Expenditures for property, plant & equipment | (17,626) | (11,364) | |||
Payments to Acquire Investments | 10,000 | ||||
Payments to Acquire Businesses, Net of Cash Acquired | 441,340 | 0 | |||
Other, net | 1,238 | (502) | |||
Net cash used in investing activities | (466,528) | (15,294) | |||
Cash flows from financing activities: | |||||
Purchase of treasury shares | (64) | (762) | (459) | ||
Dividends paid | (16,760) | (16,672) | |||
Payments of Debt Issuance Costs | (4,285) | 0 | |||
Other, net | 1,725 | 4,086 | |||
Net cash provided by (used in) financing activities | 391,918 | (13,045) | |||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Excluding Exchange Rate Effect | (108,310) | (14,216) | |||
Effect of Exchange Rate on Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | (1,132) | (415) | |||
Cash and cash equivalents at beginning of period | $ 136,089 | ||||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | 31,358 | 31,358 | $ 140,800 | ||
Cash and cash equivalents and restricted cash at end of period | $ 31,358 | 31,358 | 121,458 | $ 140,800 | |
Payments to Acquire Investments | 10,000 | ||||
Payments to Acquire Businesses, Net of Cash Acquired | 441,340 | 0 | |||
Proceeds from (Repayments of) Lines of Credit | $ 412,000 | 0 | |||
Near Earth Autonomy | |||||
Cash flows from investing activities: | |||||
Payments to Acquire Investments | 0 | ||||
Payments to Acquire Investments | $ 0 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals)) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | $ 260,640 | $ 251,888 |
Stockholders' Equity, Number of Shares, Par Value and Other Disclosures [Abstract] | ||
Preferred stock, par value (in usd per share) | $ 1 | $ 1 |
Preferred stock, shares authorized (in shares) | 200,000 | 200,000 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common stock, par value (in usd per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 30,620,003 | 30,434,269 |
Common stock held in treasury, at cost (in shares) | 2,604,564 | 2,573,896 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (Parentheticals) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Other Comprehensive Income (Loss), Defined Benefit Plan, Gain (Loss) Arising During Period, Tax | $ 259 | $ 257 | $ 756 | $ 773 |
Net earnings | 625 | 14,667 | 8,717 | 34,507 |
Foreign currency translation adjustments and other | (9,875) | (4,342) | (25,354) | 12,890 |
Change in pension and post-retirement benefit plan liabilities, net of tax expense of $259 and $257 and $756 and $773, respectively | 821 | 868 | 2,483 | 2,609 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (9,054) | (3,474) | (22,871) | 15,499 |
Comprehensive (loss) income | $ (8,429) | $ 11,193 | $ (14,154) | $ 50,006 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | BASIS OF PRESENTATION Following the sale of the Company's Distribution business in 2019, the Company operated as one segment. In the fourth quarter of 2021, our Chief Operating Decision Maker ("CODM") established a new structure for the Company to better align the Company's businesses to support capital allocation plans, portfolio management and growth. This new structure resulted in the introduction of three reportable segments: Engineered Products, Precision Products and Structures. See Note 5, Revenue and Segment Information , for 2022 financial results by segment and a recast of financial results by segment for the three-month and nine-month fiscal periods ended October 1, 2021. In the opinion of management, the condensed consolidated financial information reflects all adjustments necessary for a fair statement of the Company's financial position, results of operations and cash flows for the interim periods presented, but do not include all disclosures required by accounting principles generally accepted in the United States of America ("GAAP"). All such adjustments are of a normal recurring nature, unless otherwise disclosed in this report. Certain amounts in prior year financial statements and notes thereto have been reclassified to conform to current year presentation. The statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. The Company has a calendar year-end; however, its first three fiscal quarters follow a 13-week convention, with each quarter ending on a Friday. The third quarters for 2022 and 2021 ended on September 30, 2022, and October 1, 2021, respectively. |
Recent Accounting Standards Rec
Recent Accounting Standards Recent Accounting Standards (Notes) | 9 Months Ended |
Sep. 30, 2022 | |
Recent Accounting Standards [Abstract] | |
Recent Accounting Standards | RECENT ACCOUNTING STANDARDS Recent Accounting Standards Adopted In October 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2021-08, "Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers". The amendments in this standard update address diversity and inconsistency related to the recognition and measurement of contract assets and contract liabilities acquired in a business combination and require that an acquirer recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606, Revenue from Contracts with Customers. This standard update is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years and should be applied prospectively to business combinations occurring on or after the effective date of the amendments. Early adoption of the standard is permitted, including adoption in an interim period. The Company early adopted this standard in the third quarter of 2022, including the practical expedient that allowed the Company to utilize the terms that existed as of the latest contract modification date to determine the transaction price and performance obligations. The adoption of this standard update did not have a material impact on the Company's consolidated financial statements. In May 2021, the FASB issued ASU 2021-04, "Earnings Per Share (Topic 260), Debt - Modifications and Extinguishments (Subtopic 470-50), Compensation - Stock Compensation (Topic 718), and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40): Issuer's Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (a consensus of the FASB Emerging Issues Task Force)". The objective of this standard update is to clarify and reduce diversity in an issuer's accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. The guidance clarifies whether an issuer should account for a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as either an adjustment to equity and, if so, the related earnings per share ("EPS") effects, if any, or as an expense and, if so, the manner and pattern of recognition. The standard update is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption was permitted, including adoption in an interim period. The Company adopted this standard on January 1, 2022. The adoption of this standard update did not have a material impact on the Company's consolidated financial statements. 2. RECENT ACCOUNTING STANDARDS (CONTINUED) Recent Accounting Standards Adopted - continued In August 2020, the FASB issued ASU 2020-06, "Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity". The objective of this standard update is to simplify the accounting for certain financial instruments with characteristics of liabilities and equity. The update removes certain separation models between a debt component and equity or derivative component for certain convertible instruments. Entities that previously required separate accounting for conversion features will report less interest expense as those conversion features were recorded as debt discounts which were amortized over the term of the debt. In addition, this ASU adds new disclosure requirements for convertible instruments to improve the decision usefulness and relevance of the information being provided to users of financial statements, clarifies the guidance for determining whether a contract qualifies for a scope exception from derivative accounting, and requires the application of the if-converted method when calculating diluted EPS guidance to improve consistency. The standard update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021. Early adoption of the standard was permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. An entity should adopt the guidance as of the beginning of its annual fiscal year and can do so using a modified retrospective method or fully retrospective method of transition. On January 1, 2022, the Company adopted ASU 2020-06 using the modified retrospective basis which resulted in a cumulative effect adjustment to the opening balance sheet. The prior period condensed consolidated financial statements have not been retroactively adjusted and continue to be reported under the accounting standard in effect for the period. The cumulative effect of the adjustments recorded to the opening balance sheet on January 1, 2022 for the adoption of ASU 2020-06 was as follows: in thousands Balance at December 31, 2021 Adjustments due to ASU 2020-06 Balance at January 1, 2022 Assets Deferred income taxes $ 15,717 $ 1,770 $ 17,487 Liabilities Long-term debt, excluding current portion, net of debt issuance costs $ 189,421 $ 7,624 $ 197,045 Equity Additional paid-in capital $ 248,153 $ (12,489) $ 235,664 Retained earnings $ 750,445 $ 6,635 $ 757,080 Beginning in 2022, the Company will calculate diluted EPS using the if-converted method for its convertible debt instruments, which is not expected to have a material impact on the consolidated results. Historically, the Company used the treasury stock method to calculate diluted EPS for its convertible debt instruments. In the third quarter of 2022, there was no impact as diluted EPS calculated to $0.02 and $0.31, respectively, using both the if-converted method and treasury stock method. Refer to Note 13, Debt, for further information on the Company's convertible notes. 2. RECENT ACCOUNTING STANDARDS (CONTINUED) Recent Accounting Standards Yet to be Adopted In March 2022, the FASB issued ASU 2022-01, "Derivatives and Hedging (Topic 815): Fair Value Hedging-Portfolio Layer Method". The amendments in this standard update expand the current last-of-layer method of hedge accounting that permits only one hedged layer to allow multiple hedged layers of a single closed portfolio. This standard update is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted on any date on or after the issuance of this update for any entity that has adopted the amendments in ASU 2017-12 for the corresponding period. If an entity adopts the amendments in an interim period, the effect of adopting the amendments related to basis adjustments should be reflected as of the beginning of the fiscal year of adoption. The adoption of this standard update is not expected to have a material impact on the Company's consolidated financial statements; however, the impact will be dependent on future hedging activity. In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848) - Facilitation of the Effects of Reference Rate Reform on Financial Reporting". The objective of the standard is to address operational challenges likely to arise in accounting for contract modifications and hedge accounting due to reference rate reform. The amendments in this ASU provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The standard update is effective for all entities as of March 12, 2020 through December 31, 2022. An entity may elect to apply the amendments for contract modifications by topic or industry subtopic as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or prospectively from a date within an interim period that includes or is subsequent to March 12, 2020. Once elected for a topic or industry subtopic, the amendments in this standard update must be applied prospectively for all eligible contract modifications for that topic or industry subtopic. An entity may elect to apply the amendments for eligible hedging relationships existing as of the beginning of the interim period that includes March 12, 2020 and to new eligible hedging relationships entered into after the beginning of the interim period that includes March 12, 2020. If an entity elects to apply any of the amendments for an eligible hedging relationship existing as of the beginning of the interim period that includes March 12, 2020, any adjustments as a result of those elections must be reflected as of the beginning of that interim period. If an entity elects to apply any of the amendments for a new hedging relationship entered into between the beginning of the interim period that includes March 12, 2020 and March 12, 2020, any adjustments as a result of those elections must be reflected as of the beginning of the hedging relationship. In December 2021, the Company amended its credit agreement to move its LIBOR benchmark for non-USD borrowings to other non-USD benchmark rates. Future USD borrowings under this current Credit Agreement will continue to be based on LIBOR. The impact of the adoption of this standard update is dependent on the Company's contracts modifications as a result of reference rate reform; however, the Company does not expect the adoption of the amendments associated with hedging relationships to have a material impact on the Company's consolidated financial statements. Subsequent to the issuance of ASU 2020-04, the FASB issued the following update: ASU 2021-01, "Reference Rate Reform (Topic 848) - Scope". The amendments in this update affect the guidance within ASU 2020-04 and are being assessed with ASU 2020-04. |
Disposals
Disposals | 9 Months Ended |
Sep. 30, 2022 | |
Discontinued Operations [Abstract] | |
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] | . DISPOSALS Mexico Business In the third quarter of 2022, the Company sold certain assets and liabilities of its Mexico operations in the Structures segment. The transaction did not meet the criteria set forth in ASC 205-20 for discontinued operations as it does not reflect a significant strategic shift that would have a major effect on the Company's operations or financial results. In the three-month and nine-month fiscal periods ended September 30, 2022, the Company recorded a gain on the sale of $0.5 million, which was included in (gain) loss on sale of business on the Company's Condensed Consolidated Statement of Operations. UK Composites Business In the fourth quarter of 2020, the Company received approval from its Board of Directors to sell its United Kingdom ("UK") Composites division. The sale of the UK Composites business did not meet the criteria set forth in ASC 205-20 for discontinued operations as it did not reflect a significant strategic shift that would have a major effect on the Company's operations or financial results. As a result of the approved plan, the UK Composites division met the criteria set forth in ASC 205-20 for held for sale presentation at December 31, 2020. At December 31, 2020, the assets of the UK Composites business were considered impaired as the estimated fair value of the disposal group was lower than the estimated carrying value of the UK Composites business. As such, the assets of the UK Composites business were written off and the related liabilities of the UK division to be sold were reclassified to liabilities held for sale, as of December 31, 2020 on the Company's Consolidated Balance Sheet. The Company recorded an impairment loss of $36.3 million in the year ended December 31, 2020. The Company sold its UK Composites division in a transaction that closed on February 2, 2021. In the first quarter of 2021, when the sale was finalized, the Company recorded an additional loss of $0.2 million, which was included in (gain) loss on sale of business on the Company's Condensed Consolidated Statement of Operations for the nine-month fiscal period ended October 1, 2021, resulting in a total loss on the sale of the UK Composites business of $36.5 million. Cash and cash equivalents and restricted cash at the beginning of the period on the Company's Condensed Consolidated Statement of Cash Flows for the nine-month fiscal period ended October 1, 2021 included $6.6 million of cash that was included in the UK Composites business disposal group. Given the assets of the disposal group were recognized net of the impairment recorded in the year ended December 31, 2020, such amounts were not reflected on the Company's Consolidated Balance Sheet at December 31, 2020. Distribution Business On August 26, 2019, the Company completed the sale of its Distribution business. Upon closing, the Company entered into a transition services agreement ("TSA") with the buyer, pursuant to which the Company agreed to support the information technology ("IT"), human resources and benefits, tax and treasury functions of the Distribution business for six to twelve months. The buyer exercised an option to extend the support period for up to one additional year for certain services. During the third quarter of 2021, the TSA expired and all services were completed as of the end of the period. As such, there was no activity associated with the TSA in 2022. Through the term of the TSA, the Company incurred $18.9 million in costs and earned $13.0 million in income associated with the TSA. Costs and income earned associated with the TSA in the three-month fiscal period ended October 1, 2021 were not material. The Company incurred $1.7 million in costs and earned $0.9 million in income associated with the TSA in the nine-month fiscal period ended October 1, 2021. These amounts were included in costs from transition services agreement and income from transition services agreement on the Company's Condensed Consolidated Statements of Operations, respectively. Since the sale of the Distribution business, cash outflows from the Company to its former Distribution business totaled $8.7 million through September 30, 2022, which primarily related to Distribution employee and employee-related costs incurred prior to the sale. There were no cash flows from the Company to its former Distribution business in the nine-month fiscal periods ended September 30, 2022 and October 1, 2021. Since the sale of the Distribution business, cash inflows from the Company's former Distribution business to the Company totaled $19.2 million through September 30, 2022, which primarily related to cash received for services performed under the TSA and the $5.2 million working capital adjustment settled in the first quarter of 2020. Cash inflows from the Company's former Distribution business received in the nine-month fiscal period ended October 1, 2021 totaled $1.8 million. Cash inflows from the former Distribution business were not material in 2022. |
Business Combinations
Business Combinations | 9 Months Ended |
Sep. 30, 2022 | |
Acquisitions [Abstract] | |
Business Combination Disclosure | 4. BUSINESS COMBINATIONS AND INVESTMENTS Aircraft Wheel & Brake On September 16, 2022, the Company acquired all of the assets and related liabilities of Parker-Hannifin Corporation's ("Parker") Aircraft Wheel and Brake division ("the Acquisition"), of Avon, Ohio, at a purchase price of $441.3 million. Aircraft Wheel and Brake is a leader in the design, development, qualification, manufacturing and assembly, product support and repair of wheels, brakes and related hydraulic components for fixed-wing aircraft and rotorcraft. With this acquisition, the Company has expanded its portfolio of engineered products, broadening the number of offerings available to serve customers across a range of critical applications and has increased the Company's exposure within the aerospace and defense end markets. This acquisition was accounted for under the acquisition method. The assets acquired and liabilities assumed were recorded based on their fair values at the date of acquisition as follows (in thousands): Accounts receivable $ 7,635 Contract assets 171 Inventories 11,246 Property, plant and equipment 7,686 Goodwill 162,390 Other intangible assets 257,900 Contract costs, noncurrent 41 Liabilities (5,729) Net assets acquired 441,340 Less cash received — Net consideration $ 441,340 The preliminary purchase price allocation for the Acquisition was based upon a preliminary valuation and the Company's estimates and assumptions for this acquisition are subject to change as the Company obtains additional information during the measurement period. The principal areas of the purchase price allocation that are not yet finalized relate to the validation of certain forecasted cash flows used to value the identifiable intangible assets. These purchase price allocations will be finalized within the one-year measurement period. The goodwill associated with this acquisition is tax deductible and is the result of expected synergies from combining the operations of the acquired business with the Company's operations and intangible assets that do not qualify for separate recognition, such as an assembled workforce. The goodwill associated with this acquisition was recognized in the Engineered Products segment. The Company is evaluating the assignment of goodwill to a reporting unit. The fair value of the identifiable intangible assets totaling $257.9 million, consisting of customer relationships and acquired backlog, was determined using the income approach, specifically, a multi-period excess earnings method. The fair values of the customer relationships and backlog of $244.5 million and $13.4 million, respectively, are being amortized based on the economic period of benefit over a period of 24 years and two Aircraft Wheel and Brake's results of operations have been included in the Company's financial statements for the period subsequent to the completion of the acquisition on September 16, 2022. Aircraft Wheel and Brake contributed $2.7 million of revenue and $1.1 million of operating loss for both the three-month and nine-month fiscal periods ended September 30, 2022. The following table reflects the pro forma operating results of the Company for the three-month and nine-month fiscal periods ended September 30, 2022 and October 1, 2021, which gives effect to the Acquisition as if the company had been acquired on January 1, 2021. The pro forma results are based on assumptions that the Company believes are reasonable under the circumstances. The pro forma results are not necessarily indicative of the operating results that would have occurred had the Acquisition been effective January 1, 2021, nor are they intended to be indicative of results that may occur in the future. The underlying pro forma information includes the historical financial results of the Company and the acquired business adjusted for certain items discussed below. The pro forma information does not include the effects of any synergies, cost reduction initiatives or anticipated integration costs related to the Acquisition. 4. BUSINESS COMBINATIONS AND INVESTMENTS (CONTINUED) Aircraft Wheel & Brake - continued For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Net sales 188,554 197,154 543,817 584,693 Net earnings 9,855 13,553 18,384 19,475 These pro forma results include adjustments such as inventory step-up, amortization of acquired intangible assets, depreciation of acquired plant, property, and equipment and interest expense on debt financing in connection with the Acquisition. Material pro forma adjustments directly attributable to the Acquisition for the three-month and nine-month fiscal period ended September 30, 2022 include: • Increases in depreciation of $0.1 million and $0.5 million relating to fixed assets acquired; • Increases in amortization of $1.8 million and $7.9 million relating to intangible assets acquired; • Decreases in selling, general & administrative costs of $10.1 million and $12.1 million relating to transaction costs for the Acquisition; • Increases in interest expense of $3.4 million and $11.4 million relating to debt financing in connection with the Acquisition; and • Increase in income tax expense of $1.0 million for the three-month fiscal period and decrease in income tax expense of $1.6 million for the nine-month fiscal period relating to the above adjustments. Material pro forma adjustments directly attributable to the Acquisition for the three-month fiscal period ended September 30, 2021 include: • Increase in depreciation of $0.2 million relating to fixed assets acquired; • Increase in amortization of $3.8 million relating to intangible assets acquired; • Increase in interest expense of $4.1 million relating to debt financing in connection with the Acquisition; and • Decrease in income tax expense of $1.7 million relating to the above adjustments. Material pro forma adjustments directly attributable to the Acquisition for the nine-month fiscal period ended September 30, 2021 include: • Increase in depreciation of $0.5 million relating to fixed assets acquired; • Increase in amortization of $11.3 million relating to intangible assets acquired; • Increase in selling, general & administrative costs of $12.1 million relating to transaction costs for the Acquisition; • Increase in interest expense of $12.2 million relating to debt financing in connection with the Acquisition; • Increase in cost of sales of $2.3 million relating to the step-up of acquired inventory; and • Decrease in income tax expense of $8.0 million relating to the above adjustments. Near Earth Autonomy On June 22, 2022, the Company invested $10.0 million in Near Earth Autonomy, Inc. ("Near Earth"), in exchange for a minority interest in the outstanding equity of Near Earth and one seat on its Board of Directors. This investment supports Near Earth's mission to accelerate its technology to establish an industry standard in autonomous solutions for the next generation of aviation and leverages the Company's core competency in precision parts manufacturing as the preferred manufacturer of autonomous parts and components for Near Earth. Since 2019, Near Earth has been a partner on the autonomous technology for the Company's K-MAX TITAN unmanned aerial system and the KARGO UAV unmanned aerial system, a purpose built autonomous medium lift logistics vehicle. In accordance with ASC 321, Investments - Equity Securities , the Company elected to apply the measurement alternative and accounted for the investment as an equity interest, initially measured at cost. The investment was included in Investment in Near Earth Autonomy on the Company's Condensed Consolidated Balance Sheets as of September 30, 2022. Upon observable transaction prices or impairment, the Company will remeasure the investment at fair value. 4. BUSINESS COMBINATIONS AND INVESTMENTS (CONTINUED) Bal Seal On January 3, 2020, the Company acquired all of the equity interests of Bal Seal Engineering ("Bal Seal"), of Foothill Ranch, California, at a purchase price of $317.5 million . Upon closing, the Company funded $24.7 million associated with employee retention plans at Bal Seal. This amount and related interest was included in restricted cash on the Company's Consolidated Balance Sheets as of December 31, 2020. Eligible participants received an allocation of the escrow balance one year following the acquisition date, which was reflected in the Company's cash flows from operating activities for the nine-month fiscal period ended October 1, 2021. |
Segment and Geographic Informat
Segment and Geographic Information (Notes) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue [Abstract] | |
Segment Reporting Disclosure | 5. REVENUE AND SEGMENT INFORMATION The Company is organized based upon the nature of its products and services, and is composed of three operating segments, each overseen by a segment manager. These segments are reflective of how the Company’s Chief Executive Officer, who is its CODM, reviews operating results for the purposes of allocating resources and assessing performance. The Company has not aggregated operating segments for purposes of identifying reportable segments. The Engineered Products segment serves the aerospace and defense, industrial and medical markets providing sophisticated proprietary aircraft bearings and components; super precision, miniature ball bearings; proprietary spring energized seals, springs and contacts; and wheels, brakes and related hydraulic components for helicopters and fixed-wing and UAV aircraft. The Precision Products segment serves the aerospace and defense markets providing precision safe and arming solutions for missile and bomb systems for the U.S. and allied militaries; subcontract helicopter work; restoration, modification and support of the Company's SH-2G Super Seasprite maritime helicopters; manufacture and support of the heavy lift K-MAX ® manned helicopter, the K-MAX TITAN unmanned aerial system and the KARGO UAV unmanned aerial system, a purpose built autonomous medium lift logistics vehicle. The Structures segment serves the aerospace and defense and medical end markets providing sophisticated complex metallic and composite aerostructures for commercial, military and general aviation fixed and rotary wing aircraft, and medical imaging solutions. Summarized financial information by business segment is as follows: For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Net sales: Engineered Products $ 92,052 $ 84,399 $ 263,269 $ 235,134 Precision Products 46,282 63,584 135,098 195,656 Structures 33,670 31,853 92,451 103,056 Net sales $ 172,004 $ 179,836 $ 490,818 $ 533,846 Operating income (loss): Engineered Products $ 14,156 $ 14,931 $ 40,665 $ 29,595 Precision Products 5,730 13,792 11,689 46,274 Structures 71 330 (1,376) (871) Corporate expense (20,196) (10,487) (42,728) (31,166) Other unallocated income (expenses), net (1) 685 (2,604) (2,467) (7,425) Operating income $ 446 $ 15,962 $ 5,783 $ 36,407 (1) Other unallocated expenses (income), net include costs from the TSA, restructuring and severance costs, (gain) loss on sale of business, and net loss (gain) on sale of assets. 5. REVENUE AND SEGMENT INFORMATION (CONTINUED) Disaggregation of Revenue The following tables disaggregate segment revenue by major product line: For the Three Months Ended September 30, 2022 Engineered Products Precision Products Structures Total In thousands Defense $ 13,356 $ 5,171 $ 20,805 $ 39,332 Safe and Arm Devices — 37,460 — 37,460 Commercial, Business & General Aviation 39,852 2,457 11,006 53,315 Medical 21,782 — 1,859 23,641 Industrial & Other 17,062 1,194 — 18,256 Total revenue $ 92,052 $ 46,282 $ 33,670 $ 172,004 For the Three Months Ended October 1, 2021 Engineered Products Precision Products Structures Total In thousands Defense $ 15,856 $ 7,263 $ 19,898 $ 43,017 Safe and Arm Devices — 49,393 — 49,393 Commercial, Business & General Aviation 29,711 4,953 10,082 44,746 Medical 20,123 — 1,873 21,996 Industrial & Other 18,709 1,975 — 20,684 Total revenue $ 84,399 $ 63,584 $ 31,853 $ 179,836 For the Nine Months Ended September 30, 2022 Engineered Products Precision Products Structures Total In thousands Defense $ 32,351 $ 17,122 $ 53,158 $ 102,631 Safe and Arm Devices — 96,345 — 96,345 Commercial, Business & General Aviation 109,874 18,119 33,138 161,131 Medical 65,614 — 6,155 71,769 Industrial & Other 55,430 3,512 — 58,942 Total revenue $ 263,269 $ 135,098 $ 92,451 $ 490,818 For the Nine Months Ended October 1, 2021 Engineered Products Precision Products Structures Total In thousands Defense $ 38,941 $ 21,516 $ 65,951 $ 126,408 Safe and Arm Devices — 148,985 — 148,985 Commercial, Business & General Aviation 81,643 20,727 31,464 133,834 Medical 59,800 — 5,641 65,441 Industrial & Other 54,750 4,428 — 59,178 Total revenue $ 235,134 $ 195,656 $ 103,056 $ 533,846 5. REVENUE AND SEGMENT INFORMATION (CONTINUED) Disaggregation of Revenue - continued The following table disaggregates total revenue by product types. For the Three Months Ended For the Three Months Ended September 30, 2022 October 1, 2021 Engineered Products Precision Products Structures Total Engineered Products Precision Products Structures Total Original Equipment Manufacturer 40 % 2 % 19 % 61 % 35 % 3 % 18 % 56 % Aftermarket 14 % 3 % — % 17 % 12 % 5 % — % 17 % Safe and Arm Devices — % 22 % — % 22 % — % 27 % — % 27 % Total revenue 54 % 27 % 19 % 100 % 47 % 35 % 18 % 100 % For the Nine Months Ended For the Nine Months Ended September 30, 2022 October 1, 2021 Engineered Products Precision Products Structures Total Engineered Products Precision Products Structures Total Original Equipment Manufacturer 41 % 4 % 19 % 64 % 34 % 5 % 19 % 58 % Aftermarket 12 % 4 % — % 16 % 10 % 4 % — % 14 % Safe and Arm Devices — % 20 % — % 20 % — % 28 % — % 28 % Total revenue 53 % 28 % 19 % 100 % 44 % 37 % 19 % 100 % Disaggregation of Research and Development Costs The following table presents research and development costs by segment: For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Engineered Products $ 2,106 $ 1,826 $ 6,470 $ 6,429 Precision Products 1,812 540 7,599 3,378 Structures 19 174 196 197 Total research and development costs $ 3,937 $ 2,540 $ 14,265 $ 10,004 5. REVENUE AND SEGMENT INFORMATION (CONTINUED) Disaggregation of Assets Summarized asset information by business segment is as follows: September 30, December 31, In thousands Engineered Products $ 1,044,671 $ 623,899 Precision Products 289,680 250,146 Structures 133,232 125,027 Corporate (1) 96,951 199,410 Total identifiable assets (2) $ 1,564,534 $ 1,198,482 (1) For the periods presented, the corporate identifiable assets are principally comprised of cash, short-term and long-term deferred income tax assets, cash surrender value of life insurance policies and fixed assets. (2) Identifiable assets are assets at their respective net carrying values segregated as to segment and corporate use. The increase in total assets was primarily due to the acquisition of Aircraft Wheel and Brake in the Engineered Products segment, partially offset by a decrease at Corporate due to the cash used to purchase Aircraft Wheel and Brake. Other For contracts in which revenue is recognized over time, the Company performs detailed quarterly reviews of the progress and execution of its performance obligations under these contracts. As part of this process, management reviews information including, but not limited to, any outstanding key contract matters, progress towards completion and the related program schedule, identified risks and opportunities and the related changes in estimates of revenues and costs. The risks and opportunities include management's judgment about the ability and cost to achieve the schedule (e.g., the number and type of milestone events), technical requirements (e.g., a newly-developed product versus a mature product) and other contract requirements. Management must make assumptions and estimates regarding labor productivity and availability, the complexity of the work to be performed, the availability of materials, the length of time to complete the performance obligation (e.g., to estimate increases in wages and prices for materials and related support cost allocations), execution by subcontractors, the availability and timing of funding from customers and overhead cost rates, among other variables. Based upon these reviews, the Company will record the effects of adjustments in profit estimates each period. If at any time management determines that in the case of a particular contract total costs will exceed total contract revenue, a provision for the entire anticipated contract loss is recorded at that time. Net changes in revenue associated with cost growth on the Company's over time contracts were as follows: For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Net (decrease) increase in revenue due to change in profit estimates $ (892) $ (937) $ 580 $ (1,518) In the three-month fiscal period ended September 30, 2022, the net decrease in revenue was primarily related to cost growth on certain structures programs and legacy fuzing contracts, partially offset by favorable cost performance on memory and measuring programs. The net reductions in revenue in the three-month fiscal period ended October 1, 2021 was primarily related to cost growth on certain missile fuzing contracts, partially offset by favorable cost performance on certain structures programs. In the nine-month fiscal period ended September 30, 2022, the net increase in revenue was primarily related to favorable cost performance on the joint programmable fuze ("JPF") contract with the U.S. Government ("USG"), partially offset by cost growth on certain structures programs and legacy fuzing contracts. The net reduction in revenue in the nine-month fiscal period ended October 1, 2021 was primarily related to cost growth on certain structures programs and missile fuzing contracts, partially offset by favorable cost performance on the JPF contract with the USG. 5. REVENUE AND SEGMENT INFORMATION (CONTINUED) Other - continued Unfulfilled Performance Obligations Unfulfilled performance obligations ("backlog") represents the transaction price of firm orders for which work has not been performed and excludes unexercised contract options and potential orders under ordering-type contracts. Backlog at September 30, 2022 and December 31, 2021, and the portion of backlog the Company expects to recognize revenue on over the next twelve months is as follows: September 30, 2022 (1) December 31, (in thousands) Engineered Products $ 286,164 $ 169,144 Precision Products 175,332 180,082 Structures 304,441 351,697 Total Backlog $ 765,937 $ 700,923 (1) The Company expects to recognize revenue on approximately 65% of backlog as of September 30, 2022 over the next twelve months. |
Restructuring Costs
Restructuring Costs | 9 Months Ended |
Sep. 30, 2022 | |
Restructuring Costs [Abstract] | |
Restructuring Costs | 6. RESTRUCTURING AND SEVERANCE COSTS The Company has identified workforce reductions and other reductions in certain general and administrative expenses, which resulted in $1.9 million in restructuring and severance costs in the nine-month fiscal period ended September 30, 2022. In conjunction with the sale of the Company's Mexico operations in the third quarter of 2022, the Company reversed severance costs previously accrued, which were partially offset by costs incurred in the current period. This resulted in a net reduction to restructuring and severance costs of $0.2 million for the three-month fiscal period ended September 30, 2022. In the three-month and nine-month fiscal periods ended October 1, 2021, the Company incurred $0.4 million and $3.3 million in restructuring and severance costs. These costs were included in restructuring and severance costs on the Company's Condensed Consolidated Statements of Operations. Other Matters In addition to the restructuring and severance costs discussed above, in the nine-month fiscal period ended September 30, 2022, the Company incurred $1.0 million in other severance expense. For the three-month and nine-month fiscal periods ended October 1, 2021, the Company incurred $2.2 million in costs associated with the separation of executive officers, which were included in restructuring and severance costs on the Company's Condensed Consolidated Statements of Operations. |
Accounts Receivable, Net
Accounts Receivable, Net | 9 Months Ended |
Sep. 30, 2022 | |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | |
Accounts Receivable, Net | ACCOUNTS RECEIVABLE, NET Accounts receivable, net consisted of the following: September 30, December 31, In thousands Trade receivables $ 34,300 $ 19,228 U.S. Government contracts: Billed 11,795 14,748 Cost and accrued profit - not billed 847 167 Commercial and other government contracts Billed 52,542 36,787 Cost and accrued profit - not billed 4,491 4,141 Less allowance for doubtful accounts (1,498) (1,547) Accounts receivable, net $ 102,477 $ 73,524 7. ACCOUNTS RECEIVABLE, NET (CONTINUED) The Company performs ongoing evaluations of its customers’ current creditworthiness, as determined by the review of their credit information, to determine if events have occurred subsequent to the recognition of revenue and the related receivable that provide evidence that such receivable will be realized in an amount less than that recognized at the time of sale. Estimates of credit losses are based on historical losses, current economic conditions, geographic considerations, and in some cases, evaluating specific customer accounts for risk of loss. The following table summarizes the activity in the allowance for doubtful accounts in the nine-month fiscal period ended September 30, 2022: In thousands Balance at December 31, 2021 $ (1,547) Provision (619) Additions attributable to acquisitions (67) Amounts written off 270 Recoveries 459 Changes in foreign currency exchange rates 6 Balance at September 30, 2022 $ (1,498) Accounts receivable, net includes amounts for matters such as contract changes, negotiated settlements and claims for unanticipated contract costs. These amounts are as follows: September 30, December 31, In thousands Contract changes, negotiated settlements and claims for unanticipated contract costs $ — $ 900 |
Contract Assets, Contract Costs
Contract Assets, Contract Costs and Contract Liabilities | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Contract Assets, Contract Costs and Contract Liabilities | Activity related to contract assets, contract costs and contract liabilities was as follows: September 30, December 31, 2021 $ Change % Change In thousands Contract assets $ 117,828 $ 112,354 $ 5,474 4.9 % Contract costs, current portion $ 822 $ 850 $ (28) (3.3) % Contract costs, noncurrent portion $ 9,865 $ 10,249 $ (384) (3.7) % Contract liabilities, current portion $ 3,932 $ 2,945 $ 987 33.5 % Contract liabilities, noncurrent portion $ 20,477 $ 16,528 $ 3,949 23.9 % Contract Assets The increase in contract assets was primarily due to the recognition of revenue related to the satisfaction or partial satisfaction of performance obligations for work performed and not yet billed on the A-10 program and the Sikorsky Combat Rescue Helicopter program compared to lower amounts billed in the current period on the JPF program, KAflex® products and the AH-1Z program. There were no significant impairment losses related to the Company's contract assets during the three-month and nine-month fiscal periods ended September 30, 2022 and October 1, 2021. 8. CONTRACT ASSETS, CONTRACT COSTS AND CONTRACT LIABILITIES (CONTINUED) Contract assets includes amounts for matters such as contract changes, negotiated settlements and claims for unanticipated contract costs. These amounts were as follows: September 30, December 31, In thousands Contract changes, negotiated settlements and claims for unanticipated contract costs $ — $ 682 Contract Costs At September 30, 2022 and December 31, 2021, costs to fulfill a contract were $10.7 million and $11.1 million, respectively. These amounts were included in contract costs, current portion and contract costs, noncurrent portion on the Company's Condensed Consolidated Balance Sheets at September 30, 2022 and December 31, 2021. There were no costs to obtain a contract at September 30, 2022 and December 31, 2021. Contract costs, current portion at September 30, 2022 remained relatively flat compared to the balance at December 31, 2021. This was primarily attributable to the reclassification of a portion of costs to fulfill certain structures programs from contract costs, noncurrent portion, mostly offset by the amortization of contract costs. For the three-month and nine-month fiscal periods ended September 30, 2022, amortization of contract costs was $0.2 million and $0.5 million, respectively. For the three-month and nine-month fiscal periods ended October 1, 2021, amortization of contract costs was $1.7 million and $6.9 million, respectively. Contract costs, noncurrent portion at September 30, 2022 decreased when compared to the balance at December 31, 2021 due to the reclassification of costs on certain structures programs to contract costs, current portion. Contract Liabilities Contract liabilities, current portion at September 30, 2022 increased compared to the balance at December 31, 2021. This was primarily due to advances received for the JPF program and the FireBurst TM enhanced fuzing capability program and the addition of contract liabilities from the Aircraft Wheel and Brake acquisition, partially offset by a reduction in contract liabilities as a result of the disposal of the Company's Mexico operations. Revenue recognized related to contract liabilities, current portion was $0.2 million and $1.4 million in the three-month and nine-month fiscal periods ended September 30, 2022, respectively. Revenue recognized related to contract liabilities, current portion was $18.3 million and $38.8 million in the three-month and nine-month fiscal periods ended October 1, 2021, respectively. Contract liabilities, noncurrent portion at September 30, 2022 increased compared to the balance at December 31, 2021 due to advances received for the JPF program and the FireBurst TM enhanced fuzing capability program. For the three-month and nine-month fiscal periods ended September 30, 2022 and October 1, 2021, the Company did not recognize revenue against contract liabilities, noncurrent portion. Refer to Note 15, Commitments and Contingencies , for further information on the Company's offset agreements. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. The Company uses a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data. • Level 3 — Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The following table presents the carrying value and fair value of financial instruments that are not carried at fair value: September 30, 2022 December 31, 2021 Carrying Value Fair Value Carrying Value Fair Value In thousands Debt (1) $ 611,500 $ 587,738 $ 191,876 $ 213,222 (1) These amounts are classified within Level 2. The above fair values were computed based on quoted market prices and discounted future cash flows (observable inputs), as applicable. Differences from carrying values are attributable to interest rate changes subsequent to when the transactions occurred. The fair values of cash and cash equivalents, accounts receivable, net and accounts payable - trade approximate their carrying amounts due to the short-term maturities of these instruments. The Company's cash and cash equivalents at September 30, 2022 and December 31, 2021 included $0.1 million and $65.5 million, respectively, of Level 1 money market funds. Recurring Fair Value Measurements The Company holds derivative instruments for foreign exchange contracts that are measured at fair value using observable market inputs such as forward rates and its counterparties’ credit risks. Based on these inputs, the derivative instruments are classified within Level 2 of the valuation hierarchy. At September 30, 2022 and December 31, 2021, the derivative instruments were included in other current assets and other current liabilities on the Company's Condensed Consolidated Balance Sheets. Based on the Company's continued ability to trade and enter into forward contracts and interest rate swaps, the Company considers the markets for its fair value instruments to be active. The Company evaluated the credit risk associated with the counterparties to these derivative instruments and determined that as of September 30, 2022, such credit risks had not had an adverse impact on the fair value of these instruments. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | DERIVATIVE FINANCIAL INSTRUMENTSThe Company is exposed to certain risks relating to its ongoing business operations, including market risks relating to fluctuations in foreign currency exchange rates and interest rates. Derivative financial instruments are recognized on the Condensed Consolidated Balance Sheets as either assets or liabilities and are measured at fair value. Changes in the fair values of derivatives are recorded each period in earnings or accumulated other comprehensive income, depending on whether a derivative is effective as part of a hedged transaction. Gains and losses on derivative instruments reported in accumulated other comprehensive income (loss) are subsequently included in earnings in the periods in which earnings are affected by the hedged item. The Company does not use derivative instruments for speculative purposes. 10. DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED) Forward Exchange Contracts The Company holds forward exchange contracts designed to hedge forecasted transactions denominated in foreign currencies and to minimize the impact of foreign currency fluctuations on the Company’s earnings and cash flows. Some of these contracts are designated as cash flow hedges. The Company will include in earnings amounts currently included in accumulated other comprehensive income (loss) upon recognition of cost of sales related to the underlying transaction. These contracts were not material to the Company's Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021. The activity related to these contracts was not material to the Company's Condensed Consolidated Financial Statements for the three-month and nine-month fiscal periods ended September 30, 2022 and October 1, 2021. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Inventories | INVENTORIES Inventories consisted of the following: September 30, December 31, In thousands Raw materials $ 23,850 $ 19,123 Contracts and other work in process (including certain general stock materials) 159,664 138,737 Finished goods 38,301 35,240 Inventories $ 221,815 $ 193,100 Inventories include amounts associated with matters such as contract changes, negotiated settlements and claims for unanticipated contract costs. These amounts were as follows: September 30, December 31, In thousands Contract changes, negotiated settlements and claims for unanticipated contract costs $ — $ 552 At September 30, 2022 and December 31, 2021, $72.4 million and $69.2 million, respectively, of K-MAX® inventory was included in contracts and other work in process inventory and finished goods on the Company's Condensed Consolidated Balance Sheets. Management believes that approximately $32.4 million of the K-MAX® inventory will be sold after September 30, 2023, based upon the anticipation of additional aircraft manufacturing and the requirements to support the fleet for the foreseeable future. At September 30, 2022 and December 31, 2021, $6.4 million and $6.0 million, respectively, of SH-2G(I) inventory was included in contracts and other work in process inventory on the Company's Condensed Consolidated Balance Sheets. Management believes that approximately $4.5 million of the SH-2G(I) inventory will be sold after September 30, 2023. This balance represents spares requirements and inventory to be used on SH-2G programs. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets, Net | 9 Months Ended |
Sep. 30, 2022 | |
Intangible Assets, Net (Including Goodwill) [Abstract] | |
Goodwill and Other Intangible Assets, Net | GOODWILL AND OTHER INTANGIBLE ASSETS, NET Goodwill The following table sets forth the change in the carrying amount of goodwill for each reportable segment and for the Company: Engineered Products Precision Products Structures Total In thousands Gross balance at December 31, 2021 $ 199,306 $ 41,375 $ 66,559 $ 307,240 Accumulated impairment — — (66,559) (66,559) Net balance at December 31, 2021 199,306 41,375 — 240,681 Additions (1) 162,390 — — 162,390 Impairments — — — — Foreign currency translation (12,337) — — (12,337) Ending balance at September 30, 2022 $ 349,359 $ 41,375 $ — $ 390,734 Accumulated impairment at end of period $ — $ — $ (66,559) $ (66,559) (1) The additions to goodwill in the nine-month fiscal period ended September 30, 2022 were attributable to the acquisition of Aircraft Wheel and Brake. Refer to Note 4, Business Combinations and Investments , for further information on this acquisition . In accordance with ASC 350 - Intangibles - Goodwill and Other ("ASC 350"), the Company evaluates goodwill for possible impairment on at least an annual basis. The Company is currently in the process of updating its long-term forecast, which it will use to complete its annual evaluation during the fourth quarter. Management has determined that the Company will perform a quantitative assessment, rather than a qualitative assessment, for the KPP-Orlando reporting unit, a division of the Precision Products segment which manufactures and produces the JPF. The quantitative assessment could result in the determination that there has been an impairment of some or all of the goodwill associated with this reporting unit. The goodwill associated with the KPP-Orlando reporting unit is $41.4 million. Other Intangible Assets Other intangible assets consisted of: At September 30, At December 31, 2022 2021 Amortization Gross Accumulated Gross Accumulated In thousands Customer lists / relationships 6-38 years $ 368,554 $ (37,818) $ 127,206 $ (35,096) Developed technologies 7-20 years 44,357 (16,113) 45,170 (13,591) Trademarks / trade names 15-40 years 16,284 (2,818) 16,982 (2,659) Non-compete agreements and other 1-15 years 17,813 (4,833) 4,629 (4,617) Patents 17 years 533 (481) 523 (473) Total intangible assets $ 447,541 $ (62,063) $ 194,510 $ (56,436) The increase in other intangible assets, net was primarily attributable to the acquisition of Aircraft Wheel and Brake. Refer to Note 4, Business Combinations and Investments |
Debt
Debt | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt Disclosure | 13. DEBT The Company has long-term debt as follows: September 30, December 31, In thousands Revolving credit agreement (1) $ 412,000 $ — Convertible notes 199,500 191,876 Total 611,500 191,876 Less current portion — — Total excluding current portion $ 611,500 $ 191,876 (1) The borrowings under the revolving credit agreement in the nine-month fiscal period ended September 30, 2022 were attributable to the funds required for the acquisition of Aircraft Wheel and Brake. Refer to Note 4, Business Combinations and Investments , for further information on this acquisition . At September 30, 2022 and December 31, 2021, the long-term debt balances on the Company's Condensed Consolidated Balance Sheets were net of debt issuance costs of $1.7 million and $2.5 million, respectively. The weighted average interest rate on long-term borrowings outstanding as of September 30, 2022 and December 31, 2021 was 3.72% and 3.25%, respectively. Convertible Notes During May 2017, the Company issued $200.0 million aggregate principal amount of convertible senior unsecured notes due May 2024 (the "2024 Notes") pursuant to an indenture (the "Indenture"), dated May 12, 2017, between the Company and U.S. Bank National Association, as trustee. In connection therewith, the Company entered into certain capped call transactions that cover, collectively, the number of shares of the Company's common stock underlying the 2024 Notes. On May 12, 2017, the Company issued $175.0 million in principal amount of 2024 Notes, in a private placement offering. On May 24, 2017, the Company issued an additional $25.0 million in principal amount of 2024 Notes pursuant to the initial purchasers' exercise of their overallotment option, resulting in the issuance of an aggregate $200.0 million principal amount of 2024 Notes. The 2024 Notes bear 3.25% interest per annum on the principal amount, payable semiannually in arrears on May 1 and November 1 of each year, beginning on November 1, 2017. The 2024 Notes will mature on May 1, 2024, unless earlier repurchased by the Company or converted. The Company will settle any conversions of the 2024 Notes in cash, shares of the Company's common stock or a combination of cash and shares of common stock, at the Company's election. The sale of the Distribution business in the third quarter of 2019 was deemed to be a "Fundamental Change" and a "Make-Whole Fundamental Change" pursuant to the terms and conditions of the indenture governing the 2024 Notes. As a result, the sale triggered the right of the holders of our 2024 Notes to require us to repurchase all of the 2024 Notes, or any portion thereof that is a multiple of $1,000 principal amount on September 27, 2019. The aggregate principal amount of the 2024 Notes validly tendered and not validly withdrawn was $0.5 million, representing 0.25% of all outstanding notes. Holders of such notes receive the purchase price equal to 100% of the principal amount of the 2024 Notes being purchased, plus accrued and unpaid interest. 13. DEBT (CONTINUED) Convertible Notes - continued The following table illustrates the conversion rate at the date of issuance of the 2024 Notes: 2024 Notes Conversion Rate per $1,000 principal amount (1) 15.3227 Conversion Price (2) 65.2626 Contingent Conversion Price (3) 84.8413 Aggregate shares to be issued upon conversion (4) 3,056,879 (1) Represents the number of shares of Common Stock hypothetically issuable per each $1,000 principal amount of 2024 Notes, subject to adjustments upon the occurrence of certain specified events in accordance with the terms of the Indenture. (2) Represents $1,000 divided by the conversion rate as of such date. The conversion price reflects the strike price of the embedded option within the 2024 Notes. If the Company's share price exceeds the conversion price at conversion, the noteholders would be entitled to receive additional consideration either in cash, shares or a combination thereof, the form of which is at the sole discretion of the Company. (3) Prior to November 1, 2023, the notes are convertible only in the following circumstances: (1) during any fiscal quarter commencing after July 1, 2017, and only during any such fiscal quarter, if the last reported sale price of the Company's common stock was greater than or equal to 130% of the applicable conversion price for at least 20 trading days (whether or not consecutive) during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter, (2) during the five consecutive business day period following any ten consecutive trading day period (the "measurement period") in which the trading price per $1,000 principal amount of 2024 Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company's common stock and the conversion rate on each such trading day or (3) upon the occurrence of specified corporate events. On or after November 1, 2023, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their notes at any time, regardless of the foregoing circumstances. If the Company undergoes a fundamental change (as defined in the Indenture), holders of the notes may require the Company to repurchase all or a portion of their notes for cash at a repurchase price equal to 100% of the principal amount to be repurchased, plus any accrued and unpaid interest. As of September 30, 2022, none of the conditions permitting the holders of the 2024 Notes to convert had been met. Therefore, the 2024 Notes are classified as long-term debt. (4) This represents the number of shares hypothetically issuable upon conversion of 100% of the outstanding aggregate principal amount of the 2024 Notes at each date; however, the terms of the 2024 Notes state that the Company may pay or deliver, as the case may be, cash, shares of the Company's common stock or a combination of cash and shares of common stock, at the Company's election. The Company currently intends to settle the aggregate principal amount in cash. Amounts due in excess of the principal, if any, also may be settled in cash, shares of the Company's common stock or a combination of cash and shares of common stock, at the Company's election. In connection with the 2024 Notes offering, the Company entered into capped call transactions with certain of the initial purchasers or their respective affiliates. These transactions are intended to reduce the potential dilution to the Company's shareholders and/or offset the cash payments the Company is required to make in excess of the principal amount upon any future conversion of the notes in the event that the market price per share of the Company's common stock is greater than the strike price of the capped call transactions, with such reduction and/or offset subject to a cap based on the cap price of the capped call transactions. Under the terms of the capped call transactions, the strike price ($65.2626) and the cap price ($88.7570) are each subject to adjustment in certain circumstances. In connection with establishing their initial hedges of the capped call transactions, the option counterparties or their respective affiliates entered into various derivative transactions with respect to the Company’s common stock concurrently with or shortly after the pricing of the notes. The capped call transactions, which cost an aggregate $20.5 million, were recorded as a reduction of additional paid-in capital. ASC Topic 815 - Derivatives and Hedging ("ASC 815") provides that contracts are initially classified as equity if (1) the contract requires physical settlement or net-share settlement, or (2) the contract gives the company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The settlement terms of our capped call transactions require net-share settlement. Based on the guidance in ASC 815, the capped call transactions were recorded as a reduction of equity as of the trade date. ASC 815 states that a reporting entity shall not consider contracts to be derivative instruments if the contract issued or held by the reporting entity is both indexed to its own stock and classified in shareholders' equity in its balance sheet. The Company concluded the capped call transactions should be accounted for in shareholders' equity and are, therefore, not to be considered a derivative instrument. 13. DEBT (CONTINUED) Convertible Notes - continued At issuance, ASC 470-20 "Debt with Conversion and Other Options " (“ASC 470-20”) clarified the accounting for convertible debt instruments that may be settled in cash upon conversion, including partial cash settlement. ASC 470-20 specified that an issuer of such instruments should separately account for the liability and equity components of the instruments in a manner that reflects the issuer's non-convertible debt borrowing rate which interest costs are to be recognized in subsequent periods. The note payable principal balance for the 2024 Notes at the date of issuance of $200.0 million was bifurcated into the debt component of $179.5 million and the equity component of $20.5 million. The difference between the note payable principal balance and the fair value of the debt component representing the debt discount was being accreted to interest expense over the term of the 2024 Notes. The fair value of the debt component was recognized using a 5.0% discount rate, representing the Company's borrowing rate at the date of issuance for a similar debt instrument without a conversion feature with an expected life of seven years. At January 1, 2022, the Company adopted ASU 2020-06, which removed certain separation models between a debt component and equity component for certain convertible instruments. As a result, the convertible notes balance consists solely of a debt component as of the adoption. Refer to Note 2, Recent Accounting Standards , for further information on the cumulative effect adjustment recorded at adoption. The Company incurred $7.4 million of debt issuance costs in connection with the sale of the 2024 Notes, which was allocated between the debt and equity components of the instrument at issuance. Of the total amount, $0.7 million was recorded as an offset to additional paid-in capital. The balance, $6.7 million, was recorded as a contra-debt balance and was being amortized over the term of the 2024 Notes. As a result of the adoption of ASU 2020-06, the amount recorded to additional paid-in capital was reclassified to retained earnings in the cumulative effect adjustment recorded on January 1, 2022. The remaining balance of debt issuance costs is being amortized over the term of the convertible notes. Total amortization expense for the three-month fiscal periods ended September 30, 2022 and October 1, 2021 was $0.3 million in both periods. Total amortization expense for the nine-month fiscal periods ended September 30, 2022 and October 1, 2021 was $0.8 million in both periods. The carrying amount of the equity component and the principal amount of the liability component, the unamortized discount and the net carrying value of the liability are as follows: 2024 Notes September 30, December 31, In thousands Principal amount of liability $ 199,500 $ 199,500 Unamortized discount (1) — 7,624 Carrying value of liability $ 199,500 $ 191,876 Equity component (1) $ — $ 20,408 (1) At January 1, 2022, the Company adopted ASU 2020-06, which removed certain separation models between a debt component and equity component for certain convertible instruments. Refer to Note 2, Recent Accounting Standards , for further information on the cumulative effect adjustment recorded at adoption. Because the embedded conversion option is indexed to the Company’s own stock and would be classified in shareholders’ equity, it does not meet the criterion under ASC 815 that would require separate accounting as a derivative instrument. 13. DEBT (CONTINUED) Convertible Notes - continued Interest expense associated with the 2024 Notes consisted of the following: For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Contractual coupon rate of interest $ 1,621 $ 1,621 $ 4,863 $ 4,863 Accretion of convertible notes discount (1) — 707 — 2,191 Interest expense - convertible notes $ 1,621 $ 2,328 $ 4,863 $ 7,054 (1) In accordance with ASU 2020-06, entities that previously required separate accounting for conversion features will report less interest expense as those conversion features were recorded as debt discounts which were amortized over the term of the debt. Refer to Note 2, Recent Accounting Standards , for further information on the adoption of ASU 2020-06. Revolving Credit Agreement On December 13, 2019, the Company closed an amended and restated $800.0 million Credit Agreement (the "Credit Agreement") with JPMorgan Chase Bank, N.A., as Administrative Agent and as Collateral Agent, which matures on December 13, 2024. Capitalized terms used but not defined within this Note 13, Debt , have the meanings ascribed thereto in the Credit Agreement. The Credit Agreement was further amended on December 8, 2021 to move its LIBOR benchmark for non-USD borrowings to other non-USD benchmark rates. Future USD borrowings under this current Credit Agreement will continue to be based on LIBOR until it is phased out, at which time such borrowings will be based on the Secured Overnight Financing Rate. On May 31, 2022, the Credit Agreement was further amended to, among other things, adjust the Total Net Leverage Ratio financial covenant in anticipation of the consummation of the announced acquisition of Parker's Aircraft Wheel and Brake division. Prior to the amendment, the Credit Agreement included a requirement that the Consolidated Total Net Leverage Ratio could not be greater than 4.00 to 1.00, with an election to increase the maximum to 4.50 to 1.00 for four consecutive quarters, in connection with a Material Permitted Investment. The financial covenant now requires for any period of four consecutive fiscal quarters ending on or after the closing date of the acquisition of Parker's Aircraft Wheel and Brake division ("closing date"), the Consolidated Total Net Leverage Ratio, as defined in the Credit Agreement, cannot be greater than 5.00 to 1.00 for any period of four consecutive quarters ending on or prior to the first anniversary of the closing date, 4.75 to 1.00 for any period of four consecutive quarters ending after the first anniversary and on or prior to second anniversary of the closing date, and 4.50 to 1.00 for any period of four consecutive quarters ending after the second anniversary of the closing date. In addition, the amendment adjusted the definitions of "permitted acquisition", "pro forma" and the "limited condition acquisition" provision, as applicable, to the acquisition of Parker's Aircraft Wheel and Brake division. Debt issuance costs in connection with the Credit Agreement have been capitalized and are being amortized over the term of the agreement. In 2019, the Company incurred $3.6 million of debt issuance costs in connection with the amendment and restatement of the Credit Agreement. An additional $4.2 million of debt issuance costs were incurred in connection with the amendment of the Credit Agreement in 2022. Total amortization expense for the three-month fiscal periods ended September 30, 2022 and October 1, 2021 was $0.7 million and $0.2 million, respectively. Total amortization expense for the nine-month fiscal periods ended September 30, 2022 and October 1, 2021 was $1.2 million and $0.6 million, respectively. 13. DEBT (CONTINUED) Revolving Credit Agreement - continued The following table shows the amounts available for borrowing under the Company's revolving credit facility: September 30, December 31, In thousands Total facility $ 800,000 $ 800,000 Amounts outstanding, excluding letters of credit 412,000 — Amounts available for borrowing, excluding letters of credit 388,000 800,000 Letters of credit under the credit facility (1)(2) 51,630 92,646 Amounts available for borrowing $ 336,370 $ 707,354 Amounts available for borrowing subject to EBITDA, as defined by the Credit Agreement $ 30,221 $ 409,914 (1) The Company has entered into standby letters of credit issued on the Company's behalf by financial institutions, and directly issued guarantees to third parties primarily related to advances received from customers and the guarantee of future performance on certain contracts. Letters of credit generally are available for draw down in the event the Company does not perform its obligations. |
Pension Plans
Pension Plans | 9 Months Ended |
Sep. 30, 2022 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | |
Compensation and Employee Benefit Plans | PENSION PLANS Components of net pension cost for the Qualified Pension Plan and Supplemental Employees’ Retirement Plan ("SERP") were as follows: For the Three Months Ended Qualified Pension Plan SERP September 30, October 1, September 30, October 1, In thousands Service cost $ 840 $ 325 $ — $ — Interest cost on projected benefit obligation 4,300 3,541 22 16 Expected return on plan assets (10,544) (11,294) — — Amortization of net loss 1,064 1,111 16 14 Net pension (income) cost $ (4,340) $ (6,317) $ 38 $ 30 For the Nine Months Ended Qualified Pension Plan SERP September 30, October 1, September 30, October 1, In thousands Service cost $ 2,522 $ 976 $ — $ — Interest cost on projected benefit obligation 12,899 10,624 66 45 Expected return on plan assets (31,633) (33,883) — — Amortization of net loss 3,193 3,333 46 49 Net pension (income) cost $ (13,019) $ (18,950) $ 112 $ 94 No contributions are expected to be made to the qualified pension plan during 2022. The Company contributed $0.4 million to the SERP through the end of the third quarter of 2022 and plans to contribute an additional $0.1 million to the SERP in 2022. For the 2021 plan year, the Company contributed $10.0 million to the qualified pension plan and $2.7 million to the SERP. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Pension Freeze Effective December 31, 2015, the Company's qualified pension plan was frozen with respect to future benefit accruals. Under USG Cost Accounting Standard (“CAS”) 413, the Company must determine the USG’s share of any pension curtailment adjustment calculated in accordance with CAS. Such adjustments can result in an amount due to the USG for pension plans that are in a surplus position or an amount due to the contractor for plans that are in a deficit position. During the fourth quarter of 2016, the Company accrued a $0.3 million liability representing its estimate of the amount due to the USG based on the Company's pension curtailment adjustment calculation, which was submitted to the USG for review in December 2016. The Company maintained its accrual at $0.3 million as of September 30, 2022. There can be no assurance that the ultimate resolution of this matter will not have a material adverse effect on the Company's results of operations, financial position and cash flows. New Hartford Property In connection with the sale of the Company’s Music segment in 2007, the Company assumed responsibility for meeting certain requirements of the Connecticut Transfer Act (the “Transfer Act”) that applied to the transfer of the New Hartford, Connecticut, facility leased by that segment for guitar manufacturing purposes (“Ovation”). Under the Transfer Act, those responsibilities essentially consist of assessing the site's environmental conditions and remediating environmental impairments, if any, caused by Ovation's operations prior to the sale. The site is a multi-tenant industrial park, in which Ovation and other unrelated entities lease space. The environmental assessment process, which began in 2008, has been completed and site remediation is in process. The Company's estimate of its portion of the cost to assess the environmental conditions and remediate this site is $2.3 million, all of which has been accrued. The remediation has been nearly completed and the Company continues to monitor the results of the remediation. The total amount paid to date in connection with these environmental remediation activities is $1.7 million. At September 30, 2022, the Company had $0.6 million accrued for these environmental remediation activities. A portion ($0.1 million) of the accrual related to this property is included in other current liabilities and the balance is included in other long-term liabilities. The remaining balance of the accrual reflects the total anticipated cost of completing these environmental remediation activities. Although it is reasonably possible that additional costs will be paid in connection with the resolution of this matter, the Company is unable to estimate the amount of such additional costs, if any, at this time. Bloomfield Property In connection with the Company’s 2008 purchase of the portion of the Bloomfield campus that Kaman Aerospace Corporation had leased from NAVAIR, the Company assumed responsibility for environmental remediation at the facility as may be required under the Transfer Act and is currently remediating the property under the guidance of the Connecticut Department of Environmental Protection. The assumed environmental liability of $10.3 million was determined by taking the undiscounted estimated remediation liability of $20.8 million and discounting it at a rate of 8%. This remediation process will take many years to complete. The total amount paid to date in connection with these environmental remediation activities is $15.4 million. At September 30, 2022, the Company had $2.0 million accrued for these environmental remediation activities. A portion ($0.3 million) of the accrual related to this property is included in other current liabilities, and the balance is included in other long-term liabilities. Although it is reasonably possible that additional costs will be paid in connection with the resolution of this matter, the Company is unable to estimate the amount of such additional costs, if any, at this time. 15. COMMITMENTS AND CONTINGENCIES (CONTINUED) Offset Agreement The Company has entered into offset agreements as a condition to obtaining orders from a Middle Eastern customer for the Company's JPF product. Offset agreements are designed to return economic value to the foreign country by requiring the Company to engage in activities supporting local defense or commercial industries, promoting a balance of trade, developing in-country technology capabilities or addressing other local development priorities. Such agreements may be satisfied through activities that do not require a direct cash payment, including transferring technology, providing manufacturing, training and other consulting support to in-country projects and the purchase by third parties of supplies from in-country vendors. The agreements may also be satisfied through the Company's use of cash for activities, such as subcontracting with local partners, purchasing supplies from in-country vendors, providing financial support for in-country projects and making investments in local ventures. At September 30, 2022, the aggregate amount of the Company's offset agreements had an outstanding notional value of approximately $220.9 million, which is equal to sixty percent of the contract value as defined by the agreement between the customer and the Company. The amount ultimately applied against offset agreements is based on negotiations with the customer and may require cash outlays that represent only a fraction of the notional value in the offset agreement. The Company continues to work with the customer to further define the requirements to satisfy the offset agreements. Offset programs typically extend over several years and may provide for penalties in the event the Company fails to perform according to offset requirements. The satisfaction of the offset requirements will be determined by the customer. In the event the offset requirements of the contract are not met, the Company could be liable for potential penalties up to $18.8 million payable to the customer. Failure to satisfy the offset requirements could also negatively impact the Company's ability to attract future orders from this customer. The Company considers these potential penalties to be a reduction to the transaction price in its determination of the value of the performance obligations within these contracts. At September 30, 2022, $17.7 million in contract liabilities associated with the potential penalties of the offset requirements were included on the Company's Condensed Consolidated Balance Sheets. Guarantee During 2020, the Company and the USG entered into a Guaranty Agreement, pursuant to which the Company agreed to guarantee the full, complete and satisfactory performance of its subsidiary, Kaman Precision Products, Inc. ("KPPI") under all current and future contracts with the USG. As of the date of this filing, the only contract in place between KPPI and the USG relates to the production and sale of the JPF. KPPI is currently fulfilling the requirements of Option 16. The guarantee was provided in lieu of a periodic financial capability review by the Financial Capacity Team ("FCT") of the Defense Contract Management Agency ("DCMA"). The Company is unable to estimate the maximum potential amount of future payments under the guarantee as it is dependent on costs incurred by the USG in the event of default. Although the Company believes the risk of default is low given the maturity and operational performance of the JPF program, there can be no assurance that the guarantee will not have a material adverse effect on the Company's results of operations, financial position and cash flows. |
Computation of Earnings Per Sha
Computation of Earnings Per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share Reconciliation [Abstract] | |
Computation of Earnings Per Share | COMPUTATION OF EARNINGS PER SHARE The computation of basic earnings per share is based on net earnings divided by the weighted average number of shares of common stock outstanding for each period. The computation of diluted earnings per share reflects the common stock equivalency of dilutive options granted to employees under the Company's stock incentive plan, shares issuable on redemption of its convertible notes and shares issuable upon redemption of outstanding warrants. For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands, except per share amounts Net earnings $ 625 $ 14,667 $ 8,717 $ 34,507 Basic: Weighted average number of shares outstanding 28,037 27,882 27,997 27,855 Basic earnings per share $ 0.02 $ 0.53 $ 0.31 $ 1.24 Diluted (1) : Weighted average number of shares outstanding 28,037 27,882 27,997 27,855 Weighted average shares issuable on exercise of dilutive stock options 51 6 79 34 Total 28,088 27,888 28,076 27,889 Diluted earnings per share $ 0.02 $ 0.53 $ 0.31 $ 1.24 (1) As a result of the adoption of ASU 2020-06, the Company began calculating diluted earnings per share using the if-converted method for its convertible debt instruments in 2022. Prior to the adoption, the Company calculated diluted earnings per share for its convertible debt instruments using the treasury stock method. The Company adopted ASU 2020-06 using the modified retrospective approach; therefore, prior period results have not been retroactively adjusted. Refer to Note 2, Recent Accounting Standards , for further information on the adoption of ASU 2020-06. Equity awards For the three-month and nine-month fiscal periods ended September 30, 2022, respectively, 756,809 and 707,584 shares issuable under equity awards granted to employees were excluded from the calculation of diluted earnings per share as they were anti-dilutive based on the average stock price during the periods. For the three-month and nine-month fiscal periods ended October 1, 2021, respectively, 650,554 and 524,617 shares issuable under equity awards granted to employees were excluded from the calculation of diluted earnings per share as they were anti-dilutive based on the average stock price during the periods. 2024 Convertible Notes For the three-month and nine-month fiscal periods ended September 30, 2022, 3,056,879 shares issuable under Convertible Notes due 2024 were excluded from the diluted earnings per share calculation because their effect was antidilutive. For the three-month and nine-month fiscal period ended October 1, 2021, shares issuable under the Convertible Notes due 2024 were excluded from the diluted earnings per share calculation because the conversion price was more than the average market price of the Company's stock during the periods. |
Share-based Arrangements
Share-based Arrangements | 9 Months Ended |
Sep. 30, 2022 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |
Share-based Payment Arrangement | 17. SHARE-BASED ARRANGEMENTS The Company accounts for stock options, restricted stock awards ("RSAs"), restricted stock units ("RSUs") and performance stock units ("PSUs") as equity awards and measures the cost of all share-based payments, including stock options, at fair value on the grant date and recognizes this cost in the statement of operations. The Company also has an employee stock purchase plan, which is accounted for as a liability award. Compensation expense for stock options, RSAs, RSUs and PSUs is recognized on a straight-line basis over the vesting period of the awards. Throughout the course of the vesting period, the Company monitors the achievement level for the return on invested capital ("ROIC") metric of the PSUs compared to the ROIC target and adjusts the number of shares expected to be earned, and the related compensation expense recorded thereafter, to reflect the most probable outcome. The PSUs granted in 2022 and 2021 assumed a 100% achievement level. In the third quarter of 2022, the PSUs granted in 2021 were adjusted to a 33% achievement level. Share-based compensation expense recorded for the three-month and nine-month fiscal periods ended September 30, 2022 was $1.3 million and $6.1 million, respectively. For the nine-month fiscal period ended September 30, 2022, $0.2 million was recorded to restructuring and severance costs and the remaining amounts were recorded to selling, general and administrative expenses on the Company's Condensed Consolidated Statements of Operations. Restructuring and severance costs associated with share-based compensation for the three-month fiscal period ended September 30, 2022 were not material. Share-based compensation expense recorded for the three-month and nine-month fiscal periods ended October 1, 2021 was $1.5 million and $5.7 million, respectively. Of these amounts, $0.1 million and $0.3 million was recorded to restructuring and severance costs, respectively, and the remaining amounts were recorded to selling, general and administrative expenses on the Company's Condensed Consolidated Statements of Operations. Stock option activity was as follows: For the Three Months Ended For the Nine Months Ended September 30, 2022 September 30, 2022 Options Weighted - average Options Weighted - average Options outstanding at beginning of period 726,691 $ 55.32 746,240 $ 55.14 Granted 39,121 $ 31.60 39,121 $ 31.60 Exercised (2,166) $ 42.86 (11,842) $ 41.90 Forfeited or expired (20,505) $ 54.53 (30,378) $ 55.35 Options outstanding at September 30, 2022 743,141 $ 54.10 743,141 $ 54.10 The fair value of each option award is estimated on the date of grant using the Black-Scholes option valuation model. The following table indicates the weighted-average assumptions used in estimating fair value: For the Nine Months Ended September 30, 2022 October 1, 2021 Expected option term (years) 6.5 4.9 Expected volatility 35.5 % 35.7 % Risk-free interest rate 2.9 % 0.5 % Expected dividend yield 2.0 % 1.6 % Per share fair value of options granted $ 10.22 $ 14.89 17. SHARE-BASED ARRANGEMENTS (CONTINUED) Restricted stock award and restricted stock unit activity were as follows: For the Three Months Ended For the Nine Months Ended September 30, 2022 September 30, 2022 Restricted Stock Weighted- Restricted Stock Weighted- Restricted Stock outstanding at beginning of period 152,200 $ 47.87 135,351 $ 53.53 Granted 18,988 $ 31.60 119,003 $ 40.29 Vested (3,746) $ 50.98 (79,075) $ 49.85 Forfeited or expired (4,221) $ 51.21 (12,058) $ 51.41 Restricted Stock outstanding at September 30, 2022 163,221 $ 45.82 163,221 $ 45.82 Performance stock unit activity was as follows: For the Three Months Ended For the Nine Months Ended September 30, 2022 September 30, 2022 Performance Stock Weighted- Performance Stock Weighted- Performance Stock outstanding at beginning of period 180,120 $ 60.55 70,163 $ 70.17 Granted — $ — 117,885 $ 54.87 Vested — $ — — $ — Forfeited or expired (6,646) $ 63.87 (14,574) $ 61.29 Performance Stock outstanding at September 30, 2022 173,474 $ 60.42 173,474 $ 60.42 The fair value of the PSUs based on total shareholder return ("TSR")was estimated on the date of grant using a Monte-Carlo simulation model. The following table indicates the weighted-average assumptions used in estimating fair value: For the Nine Months Ended September 30, 2022 October 1, 2021 Expected term (years) 2.9 2.9 Expected volatility 39.4 % 41.3 % Risk-free interest rate 1.7 % 0.2 % Expected dividend yield 1.9 % 1.4 % Per share fair value of performance stock granted $ 68.10 $ 84.49 |
Shareholders' Equity and Accumu
Shareholders' Equity and Accumulated Other Comprehensive Income | 9 Months Ended |
Sep. 30, 2022 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity and Accumulated Other Comprehensive Income | SHAREHOLDERS' EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME Changes in shareholders’ equity for the three-month and nine-month fiscal periods ended September 30, 2022, and October 1, 2021, were as follows: For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Beginning balance $ 778,942 $ 779,212 796,329 746,438 Comprehensive (loss) income (8,429) 11,193 (14,154) 50,006 Dividends declared (per share of common stock, $0.20 and $0.20 and $0.60 and $0.60, respectively) (5,604) (5,569) (16,791) (16,696) Employee stock plans and related tax benefit 430 523 1,696 2,051 Purchase of treasury shares (64) (69) (762) (459) Share-based compensation expense 1,334 1,459 6,145 5,684 Impact of change in accounting standard — — (5,854) (275) Ending balance $ 766,609 $ 786,749 $ 766,609 $ 786,749 The components of accumulated other comprehensive income (loss) are shown below: For the Three Months Ended September 30, October 1, In thousands Foreign currency translation and other: Beginning balance $ (6,707) $ 16,515 Net loss on foreign currency translation (9,875) (4,342) Other comprehensive loss, net of tax (9,875) (4,342) Ending balance $ (16,582) $ 12,173 Pension and other post-retirement benefits (1) : Beginning balance $ (118,495) $ (128,363) Amortization of net loss, net of tax expense of $259 and $257, respectively 821 868 Other comprehensive income, net of tax 821 868 Ending balance $ (117,674) $ (127,495) Total accumulated other comprehensive loss $ (134,256) $ (115,322) (1) These accumulated other comprehensive income components are included in the computation of net periodic pension cost. (See Note 14, Pension Plans for additional information.) 18. SHAREHOLDERS' EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME (CONTINUED) For the Nine Months Ended September 30, October 1, In thousands Foreign currency translation and other: Beginning balance $ 8,772 $ (717) Net loss on foreign currency translation (25,354) (9,945) Reclassification to net income (1) — 22,835 Other comprehensive (loss) income, net of tax (25,354) 12,890 Ending balance $ (16,582) $ 12,173 Pension and other post-retirement benefits (2) : Beginning balance $ (120,157) $ (130,104) Amortization of net loss, net of tax expense of $756 and $773, respectively 2,483 2,609 Other comprehensive income, net of tax 2,483 2,609 Ending balance $ (117,674) $ (127,495) Total accumulated other comprehensive loss $ (134,256) $ (115,322) (1) The foreign currency translation reclassified to net income relates to the sale of the Company's UK Composites business. This balance was included in the loss accrual recorded in impairment on assets held for sale on the Company's Consolidated Statement of Operations in the year ended December 31, 2020. (See Note 3, Disposals , for additional information.) (2) These accumulated other comprehensive income components are included in the computation of net periodic pension cost. (See Note 14, Pension Plans for additional information.) |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, Effective Income Tax Rate 17.0 % 23.3 % 18.6 % 22.7 % |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTSThe Company has evaluated subsequent events through the issuance date of these financial statements. No material subsequent events were identified that require disclosure. |
Basis of Presentation Basis of
Basis of Presentation Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Basis of Presentation [Abstract] | |
Consolidation, Policy [Policy Text Block] | BASIS OF PRESENTATION Following the sale of the Company's Distribution business in 2019, the Company operated as one segment. In the fourth quarter of 2021, our Chief Operating Decision Maker ("CODM") established a new structure for the Company to better align the Company's businesses to support capital allocation plans, portfolio management and growth. This new structure resulted in the introduction of three reportable segments: Engineered Products, Precision Products and Structures. See Note 5, Revenue and Segment Information , for 2022 financial results by segment and a recast of financial results by segment for the three-month and nine-month fiscal periods ended October 1, 2021. In the opinion of management, the condensed consolidated financial information reflects all adjustments necessary for a fair statement of the Company's financial position, results of operations and cash flows for the interim periods presented, but do not include all disclosures required by accounting principles generally accepted in the United States of America ("GAAP"). All such adjustments are of a normal recurring nature, unless otherwise disclosed in this report. Certain amounts in prior year financial statements and notes thereto have been reclassified to conform to current year presentation. The statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. The Company has a calendar year-end; however, its first three fiscal quarters follow a 13-week convention, with each quarter ending on a Friday. The third quarters for 2022 and 2021 ended on September 30, 2022, and October 1, 2021, respectively. |
Recent Accounting Standards Det
Recent Accounting Standards Details (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements, Policy [Policy Text Block] | RECENT ACCOUNTING STANDARDS Recent Accounting Standards Adopted In October 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2021-08, "Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers". The amendments in this standard update address diversity and inconsistency related to the recognition and measurement of contract assets and contract liabilities acquired in a business combination and require that an acquirer recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606, Revenue from Contracts with Customers. This standard update is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years and should be applied prospectively to business combinations occurring on or after the effective date of the amendments. Early adoption of the standard is permitted, including adoption in an interim period. The Company early adopted this standard in the third quarter of 2022, including the practical expedient that allowed the Company to utilize the terms that existed as of the latest contract modification date to determine the transaction price and performance obligations. The adoption of this standard update did not have a material impact on the Company's consolidated financial statements. In May 2021, the FASB issued ASU 2021-04, "Earnings Per Share (Topic 260), Debt - Modifications and Extinguishments (Subtopic 470-50), Compensation - Stock Compensation (Topic 718), and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40): Issuer's Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (a consensus of the FASB Emerging Issues Task Force)". The objective of this standard update is to clarify and reduce diversity in an issuer's accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. The guidance clarifies whether an issuer should account for a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as either an adjustment to equity and, if so, the related earnings per share ("EPS") effects, if any, or as an expense and, if so, the manner and pattern of recognition. The standard update is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption was permitted, including adoption in an interim period. The Company adopted this standard on January 1, 2022. The adoption of this standard update did not have a material impact on the Company's consolidated financial statements. 2. RECENT ACCOUNTING STANDARDS (CONTINUED) Recent Accounting Standards Adopted - continued In August 2020, the FASB issued ASU 2020-06, "Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity". The objective of this standard update is to simplify the accounting for certain financial instruments with characteristics of liabilities and equity. The update removes certain separation models between a debt component and equity or derivative component for certain convertible instruments. Entities that previously required separate accounting for conversion features will report less interest expense as those conversion features were recorded as debt discounts which were amortized over the term of the debt. In addition, this ASU adds new disclosure requirements for convertible instruments to improve the decision usefulness and relevance of the information being provided to users of financial statements, clarifies the guidance for determining whether a contract qualifies for a scope exception from derivative accounting, and requires the application of the if-converted method when calculating diluted EPS guidance to improve consistency. The standard update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021. Early adoption of the standard was permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. An entity should adopt the guidance as of the beginning of its annual fiscal year and can do so using a modified retrospective method or fully retrospective method of transition. On January 1, 2022, the Company adopted ASU 2020-06 using the modified retrospective basis which resulted in a cumulative effect adjustment to the opening balance sheet. The prior period condensed consolidated financial statements have not been retroactively adjusted and continue to be reported under the accounting standard in effect for the period. The cumulative effect of the adjustments recorded to the opening balance sheet on January 1, 2022 for the adoption of ASU 2020-06 was as follows: in thousands Balance at December 31, 2021 Adjustments due to ASU 2020-06 Balance at January 1, 2022 Assets Deferred income taxes $ 15,717 $ 1,770 $ 17,487 Liabilities Long-term debt, excluding current portion, net of debt issuance costs $ 189,421 $ 7,624 $ 197,045 Equity Additional paid-in capital $ 248,153 $ (12,489) $ 235,664 Retained earnings $ 750,445 $ 6,635 $ 757,080 Beginning in 2022, the Company will calculate diluted EPS using the if-converted method for its convertible debt instruments, which is not expected to have a material impact on the consolidated results. Historically, the Company used the treasury stock method to calculate diluted EPS for its convertible debt instruments. In the third quarter of 2022, there was no impact as diluted EPS calculated to $0.02 and $0.31, respectively, using both the if-converted method and treasury stock method. Refer to Note 13, Debt, for further information on the Company's convertible notes. 2. RECENT ACCOUNTING STANDARDS (CONTINUED) Recent Accounting Standards Yet to be Adopted In March 2022, the FASB issued ASU 2022-01, "Derivatives and Hedging (Topic 815): Fair Value Hedging-Portfolio Layer Method". The amendments in this standard update expand the current last-of-layer method of hedge accounting that permits only one hedged layer to allow multiple hedged layers of a single closed portfolio. This standard update is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted on any date on or after the issuance of this update for any entity that has adopted the amendments in ASU 2017-12 for the corresponding period. If an entity adopts the amendments in an interim period, the effect of adopting the amendments related to basis adjustments should be reflected as of the beginning of the fiscal year of adoption. The adoption of this standard update is not expected to have a material impact on the Company's consolidated financial statements; however, the impact will be dependent on future hedging activity. In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848) - Facilitation of the Effects of Reference Rate Reform on Financial Reporting". The objective of the standard is to address operational challenges likely to arise in accounting for contract modifications and hedge accounting due to reference rate reform. The amendments in this ASU provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The standard update is effective for all entities as of March 12, 2020 through December 31, 2022. An entity may elect to apply the amendments for contract modifications by topic or industry subtopic as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or prospectively from a date within an interim period that includes or is subsequent to March 12, 2020. Once elected for a topic or industry subtopic, the amendments in this standard update must be applied prospectively for all eligible contract modifications for that topic or industry subtopic. An entity may elect to apply the amendments for eligible hedging relationships existing as of the beginning of the interim period that includes March 12, 2020 and to new eligible hedging relationships entered into after the beginning of the interim period that includes March 12, 2020. If an entity elects to apply any of the amendments for an eligible hedging relationship existing as of the beginning of the interim period that includes March 12, 2020, any adjustments as a result of those elections must be reflected as of the beginning of that interim period. If an entity elects to apply any of the amendments for a new hedging relationship entered into between the beginning of the interim period that includes March 12, 2020 and March 12, 2020, any adjustments as a result of those elections must be reflected as of the beginning of the hedging relationship. In December 2021, the Company amended its credit agreement to move its LIBOR benchmark for non-USD borrowings to other non-USD benchmark rates. Future USD borrowings under this current Credit Agreement will continue to be based on LIBOR. The impact of the adoption of this standard update is dependent on the Company's contracts modifications as a result of reference rate reform; however, the Company does not expect the adoption of the amendments associated with hedging relationships to have a material impact on the Company's consolidated financial statements. Subsequent to the issuance of ASU 2020-04, the FASB issued the following update: ASU 2021-01, "Reference Rate Reform (Topic 848) - Scope". The amendments in this update affect the guidance within ASU 2020-04 and are being assessed with ASU 2020-04. |
Recent Accounting Standards | RECENT ACCOUNTING STANDARDS Recent Accounting Standards Adopted In October 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2021-08, "Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers". The amendments in this standard update address diversity and inconsistency related to the recognition and measurement of contract assets and contract liabilities acquired in a business combination and require that an acquirer recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606, Revenue from Contracts with Customers. This standard update is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years and should be applied prospectively to business combinations occurring on or after the effective date of the amendments. Early adoption of the standard is permitted, including adoption in an interim period. The Company early adopted this standard in the third quarter of 2022, including the practical expedient that allowed the Company to utilize the terms that existed as of the latest contract modification date to determine the transaction price and performance obligations. The adoption of this standard update did not have a material impact on the Company's consolidated financial statements. In May 2021, the FASB issued ASU 2021-04, "Earnings Per Share (Topic 260), Debt - Modifications and Extinguishments (Subtopic 470-50), Compensation - Stock Compensation (Topic 718), and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40): Issuer's Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (a consensus of the FASB Emerging Issues Task Force)". The objective of this standard update is to clarify and reduce diversity in an issuer's accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. The guidance clarifies whether an issuer should account for a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as either an adjustment to equity and, if so, the related earnings per share ("EPS") effects, if any, or as an expense and, if so, the manner and pattern of recognition. The standard update is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption was permitted, including adoption in an interim period. The Company adopted this standard on January 1, 2022. The adoption of this standard update did not have a material impact on the Company's consolidated financial statements. 2. RECENT ACCOUNTING STANDARDS (CONTINUED) Recent Accounting Standards Adopted - continued In August 2020, the FASB issued ASU 2020-06, "Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity". The objective of this standard update is to simplify the accounting for certain financial instruments with characteristics of liabilities and equity. The update removes certain separation models between a debt component and equity or derivative component for certain convertible instruments. Entities that previously required separate accounting for conversion features will report less interest expense as those conversion features were recorded as debt discounts which were amortized over the term of the debt. In addition, this ASU adds new disclosure requirements for convertible instruments to improve the decision usefulness and relevance of the information being provided to users of financial statements, clarifies the guidance for determining whether a contract qualifies for a scope exception from derivative accounting, and requires the application of the if-converted method when calculating diluted EPS guidance to improve consistency. The standard update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021. Early adoption of the standard was permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. An entity should adopt the guidance as of the beginning of its annual fiscal year and can do so using a modified retrospective method or fully retrospective method of transition. On January 1, 2022, the Company adopted ASU 2020-06 using the modified retrospective basis which resulted in a cumulative effect adjustment to the opening balance sheet. The prior period condensed consolidated financial statements have not been retroactively adjusted and continue to be reported under the accounting standard in effect for the period. The cumulative effect of the adjustments recorded to the opening balance sheet on January 1, 2022 for the adoption of ASU 2020-06 was as follows: in thousands Balance at December 31, 2021 Adjustments due to ASU 2020-06 Balance at January 1, 2022 Assets Deferred income taxes $ 15,717 $ 1,770 $ 17,487 Liabilities Long-term debt, excluding current portion, net of debt issuance costs $ 189,421 $ 7,624 $ 197,045 Equity Additional paid-in capital $ 248,153 $ (12,489) $ 235,664 Retained earnings $ 750,445 $ 6,635 $ 757,080 Beginning in 2022, the Company will calculate diluted EPS using the if-converted method for its convertible debt instruments, which is not expected to have a material impact on the consolidated results. Historically, the Company used the treasury stock method to calculate diluted EPS for its convertible debt instruments. In the third quarter of 2022, there was no impact as diluted EPS calculated to $0.02 and $0.31, respectively, using both the if-converted method and treasury stock method. Refer to Note 13, Debt, for further information on the Company's convertible notes. 2. RECENT ACCOUNTING STANDARDS (CONTINUED) Recent Accounting Standards Yet to be Adopted In March 2022, the FASB issued ASU 2022-01, "Derivatives and Hedging (Topic 815): Fair Value Hedging-Portfolio Layer Method". The amendments in this standard update expand the current last-of-layer method of hedge accounting that permits only one hedged layer to allow multiple hedged layers of a single closed portfolio. This standard update is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted on any date on or after the issuance of this update for any entity that has adopted the amendments in ASU 2017-12 for the corresponding period. If an entity adopts the amendments in an interim period, the effect of adopting the amendments related to basis adjustments should be reflected as of the beginning of the fiscal year of adoption. The adoption of this standard update is not expected to have a material impact on the Company's consolidated financial statements; however, the impact will be dependent on future hedging activity. In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848) - Facilitation of the Effects of Reference Rate Reform on Financial Reporting". The objective of the standard is to address operational challenges likely to arise in accounting for contract modifications and hedge accounting due to reference rate reform. The amendments in this ASU provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The standard update is effective for all entities as of March 12, 2020 through December 31, 2022. An entity may elect to apply the amendments for contract modifications by topic or industry subtopic as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or prospectively from a date within an interim period that includes or is subsequent to March 12, 2020. Once elected for a topic or industry subtopic, the amendments in this standard update must be applied prospectively for all eligible contract modifications for that topic or industry subtopic. An entity may elect to apply the amendments for eligible hedging relationships existing as of the beginning of the interim period that includes March 12, 2020 and to new eligible hedging relationships entered into after the beginning of the interim period that includes March 12, 2020. If an entity elects to apply any of the amendments for an eligible hedging relationship existing as of the beginning of the interim period that includes March 12, 2020, any adjustments as a result of those elections must be reflected as of the beginning of that interim period. If an entity elects to apply any of the amendments for a new hedging relationship entered into between the beginning of the interim period that includes March 12, 2020 and March 12, 2020, any adjustments as a result of those elections must be reflected as of the beginning of the hedging relationship. In December 2021, the Company amended its credit agreement to move its LIBOR benchmark for non-USD borrowings to other non-USD benchmark rates. Future USD borrowings under this current Credit Agreement will continue to be based on LIBOR. The impact of the adoption of this standard update is dependent on the Company's contracts modifications as a result of reference rate reform; however, the Company does not expect the adoption of the amendments associated with hedging relationships to have a material impact on the Company's consolidated financial statements. Subsequent to the issuance of ASU 2020-04, the FASB issued the following update: ASU 2021-01, "Reference Rate Reform (Topic 848) - Scope". The amendments in this update affect the guidance within ASU 2020-04 and are being assessed with ASU 2020-04. |
Accounting Policies (Tables)
Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Cumulative Effect Adjustment - ASU Adoption | The cumulative effect of the adjustments recorded to the opening balance sheet on January 1, 2022 for the adoption of ASU 2020-06 was as follows: in thousands Balance at December 31, 2021 Adjustments due to ASU 2020-06 Balance at January 1, 2022 Assets Deferred income taxes $ 15,717 $ 1,770 $ 17,487 Liabilities Long-term debt, excluding current portion, net of debt issuance costs $ 189,421 $ 7,624 $ 197,045 Equity Additional paid-in capital $ 248,153 $ (12,489) $ 235,664 Retained earnings $ 750,445 $ 6,635 $ 757,080 |
Business Combinations (Tables)
Business Combinations (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Acquisitions [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | This acquisition was accounted for under the acquisition method. The assets acquired and liabilities assumed were recorded based on their fair values at the date of acquisition as follows (in thousands): Accounts receivable $ 7,635 Contract assets 171 Inventories 11,246 Property, plant and equipment 7,686 Goodwill 162,390 Other intangible assets 257,900 Contract costs, noncurrent 41 Liabilities (5,729) Net assets acquired 441,340 Less cash received — Net consideration $ 441,340 |
Business Acquisition, Pro Forma Information [Table Text Block] | For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Net sales 188,554 197,154 543,817 584,693 Net earnings 9,855 13,553 18,384 19,475 |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 9 Months Ended | |
Sep. 30, 2022 | ||
Revenue [Abstract] | ||
Reconciliation of Revenue from Segments to Consolidated | Summarized financial information by business segment is as follows: For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Net sales: Engineered Products $ 92,052 $ 84,399 $ 263,269 $ 235,134 Precision Products 46,282 63,584 135,098 195,656 Structures 33,670 31,853 92,451 103,056 Net sales $ 172,004 $ 179,836 $ 490,818 $ 533,846 Operating income (loss): Engineered Products $ 14,156 $ 14,931 $ 40,665 $ 29,595 Precision Products 5,730 13,792 11,689 46,274 Structures 71 330 (1,376) (871) Corporate expense (20,196) (10,487) (42,728) (31,166) Other unallocated income (expenses), net (1) 685 (2,604) (2,467) (7,425) Operating income $ 446 $ 15,962 $ 5,783 $ 36,407 (1) Other unallocated expenses (income), net include costs from the TSA, restructuring and severance costs, (gain) loss on sale of business, and net loss (gain) on sale of assets. | |
Disaggregation of Revenue [Table Text Block] | Disaggregation of Revenue The following tables disaggregate segment revenue by major product line: For the Three Months Ended September 30, 2022 Engineered Products Precision Products Structures Total In thousands Defense $ 13,356 $ 5,171 $ 20,805 $ 39,332 Safe and Arm Devices — 37,460 — 37,460 Commercial, Business & General Aviation 39,852 2,457 11,006 53,315 Medical 21,782 — 1,859 23,641 Industrial & Other 17,062 1,194 — 18,256 Total revenue $ 92,052 $ 46,282 $ 33,670 $ 172,004 For the Three Months Ended October 1, 2021 Engineered Products Precision Products Structures Total In thousands Defense $ 15,856 $ 7,263 $ 19,898 $ 43,017 Safe and Arm Devices — 49,393 — 49,393 Commercial, Business & General Aviation 29,711 4,953 10,082 44,746 Medical 20,123 — 1,873 21,996 Industrial & Other 18,709 1,975 — 20,684 Total revenue $ 84,399 $ 63,584 $ 31,853 $ 179,836 For the Nine Months Ended September 30, 2022 Engineered Products Precision Products Structures Total In thousands Defense $ 32,351 $ 17,122 $ 53,158 $ 102,631 Safe and Arm Devices — 96,345 — 96,345 Commercial, Business & General Aviation 109,874 18,119 33,138 161,131 Medical 65,614 — 6,155 71,769 Industrial & Other 55,430 3,512 — 58,942 Total revenue $ 263,269 $ 135,098 $ 92,451 $ 490,818 For the Nine Months Ended October 1, 2021 Engineered Products Precision Products Structures Total In thousands Defense $ 38,941 $ 21,516 $ 65,951 $ 126,408 Safe and Arm Devices — 148,985 — 148,985 Commercial, Business & General Aviation 81,643 20,727 31,464 133,834 Medical 59,800 — 5,641 65,441 Industrial & Other 54,750 4,428 — 59,178 Total revenue $ 235,134 $ 195,656 $ 103,056 $ 533,846 5. REVENUE AND SEGMENT INFORMATION (CONTINUED) Disaggregation of Revenue - continued The following table disaggregates total revenue by product types. For the Three Months Ended For the Three Months Ended September 30, 2022 October 1, 2021 Engineered Products Precision Products Structures Total Engineered Products Precision Products Structures Total Original Equipment Manufacturer 40 % 2 % 19 % 61 % 35 % 3 % 18 % 56 % Aftermarket 14 % 3 % — % 17 % 12 % 5 % — % 17 % Safe and Arm Devices — % 22 % — % 22 % — % 27 % — % 27 % Total revenue 54 % 27 % 19 % 100 % 47 % 35 % 18 % 100 % For the Nine Months Ended For the Nine Months Ended September 30, 2022 October 1, 2021 Engineered Products Precision Products Structures Total Engineered Products Precision Products Structures Total Original Equipment Manufacturer 41 % 4 % 19 % 64 % 34 % 5 % 19 % 58 % Aftermarket 12 % 4 % — % 16 % 10 % 4 % — % 14 % Safe and Arm Devices — % 20 % — % 20 % — % 28 % — % 28 % Total revenue 53 % 28 % 19 % 100 % 44 % 37 % 19 % 100 % | |
Research and Development | The following table presents research and development costs by segment: For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Engineered Products $ 2,106 $ 1,826 $ 6,470 $ 6,429 Precision Products 1,812 540 7,599 3,378 Structures 19 174 196 197 Total research and development costs $ 3,937 $ 2,540 $ 14,265 $ 10,004 | |
Schedule of Change in Accounting Estimate [Table Text Block] | Net changes in revenue associated with cost growth on the Company's over time contracts were as follows: For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Net (decrease) increase in revenue due to change in profit estimates $ (892) $ (937) $ 580 $ (1,518) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Table Text Block] | Backlog at September 30, 2022 and December 31, 2021, and the portion of backlog the Company expects to recognize revenue on over the next twelve months is as follows: September 30, 2022 (1) December 31, (in thousands) Engineered Products $ 286,164 $ 169,144 Precision Products 175,332 180,082 Structures 304,441 351,697 Total Backlog $ 765,937 $ 700,923 (1) The Company expects to recognize revenue on approximately 65% of backlog as of September 30, 2022 over the next twelve months. | [1] |
Reconciliation of Assets from Segment to Consolidated | Summarized asset information by business segment is as follows: September 30, December 31, In thousands Engineered Products $ 1,044,671 $ 623,899 Precision Products 289,680 250,146 Structures 133,232 125,027 Corporate (1) 96,951 199,410 Total identifiable assets (2) $ 1,564,534 $ 1,198,482 (1) For the periods presented, the corporate identifiable assets are principally comprised of cash, short-term and long-term deferred income tax assets, cash surrender value of life insurance policies and fixed assets. (2) Identifiable assets are assets at their respective net carrying values segregated as to segment and corporate use. | |
[1]The Company expects to recognize revenue on approximately 65% of backlog as of September 30, 2022 over the next twelve months. |
Accounts Receivable, Net (Table
Accounts Receivable, Net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | |
Schedule of Accounts Receivable, Net | Accounts receivable, net consisted of the following: September 30, December 31, In thousands Trade receivables $ 34,300 $ 19,228 U.S. Government contracts: Billed 11,795 14,748 Cost and accrued profit - not billed 847 167 Commercial and other government contracts Billed 52,542 36,787 Cost and accrued profit - not billed 4,491 4,141 Less allowance for doubtful accounts (1,498) (1,547) Accounts receivable, net $ 102,477 $ 73,524 |
Financing Receivable, Allowance for Credit Loss [Table Text Block] | The following table summarizes the activity in the allowance for doubtful accounts in the nine-month fiscal period ended September 30, 2022: In thousands Balance at December 31, 2021 $ (1,547) Provision (619) Additions attributable to acquisitions (67) Amounts written off 270 Recoveries 459 Changes in foreign currency exchange rates 6 Balance at September 30, 2022 $ (1,498) |
Accounts Receivable Due to Contract Changes, Negotiated Settlements and Claims for Unanticipated Cost | Accounts receivable, net includes amounts for matters such as contract changes, negotiated settlements and claims for unanticipated contract costs. These amounts are as follows: September 30, December 31, In thousands Contract changes, negotiated settlements and claims for unanticipated contract costs $ — $ 900 |
Contract Assets, Contract Cos_2
Contract Assets, Contract Costs and Contract Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Activity Related to Contract Assets, Contract Costs, and Contract Liabilities | Activity related to contract assets, contract costs and contract liabilities was as follows: September 30, December 31, 2021 $ Change % Change In thousands Contract assets $ 117,828 $ 112,354 $ 5,474 4.9 % Contract costs, current portion $ 822 $ 850 $ (28) (3.3) % Contract costs, noncurrent portion $ 9,865 $ 10,249 $ (384) (3.7) % Contract liabilities, current portion $ 3,932 $ 2,945 $ 987 33.5 % Contract liabilities, noncurrent portion $ 20,477 $ 16,528 $ 3,949 23.9 % Contract assets includes amounts for matters such as contract changes, negotiated settlements and claims for unanticipated contract costs. These amounts were as follows: September 30, December 31, In thousands Contract changes, negotiated settlements and claims for unanticipated contract costs $ — $ 682 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Financial Instruments That Are Not Carried At Fair Value | The following table presents the carrying value and fair value of financial instruments that are not carried at fair value: September 30, 2022 December 31, 2021 Carrying Value Fair Value Carrying Value Fair Value In thousands Debt (1) $ 611,500 $ 587,738 $ 191,876 $ 213,222 (1) These amounts are classified within Level 2. |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories consisted of the following: September 30, December 31, In thousands Raw materials $ 23,850 $ 19,123 Contracts and other work in process (including certain general stock materials) 159,664 138,737 Finished goods 38,301 35,240 Inventories $ 221,815 $ 193,100 |
Inventory Due to Contract Changes, Negotiated Settlements and Claims for Unanticipated Contract Costs | Inventories include amounts associated with matters such as contract changes, negotiated settlements and claims for unanticipated contract costs. These amounts were as follows: September 30, December 31, In thousands Contract changes, negotiated settlements and claims for unanticipated contract costs $ — $ 552 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets, Net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Intangible Assets, Net (Including Goodwill) [Abstract] | |
Schedule of Goodwill | The following table sets forth the change in the carrying amount of goodwill for each reportable segment and for the Company: Engineered Products Precision Products Structures Total In thousands Gross balance at December 31, 2021 $ 199,306 $ 41,375 $ 66,559 $ 307,240 Accumulated impairment — — (66,559) (66,559) Net balance at December 31, 2021 199,306 41,375 — 240,681 Additions (1) 162,390 — — 162,390 Impairments — — — — Foreign currency translation (12,337) — — (12,337) Ending balance at September 30, 2022 $ 349,359 $ 41,375 $ — $ 390,734 Accumulated impairment at end of period $ — $ — $ (66,559) $ (66,559) |
Schedule of Acquired Finite-Lived Intangible Assets by Major Class | Other intangible assets consisted of: At September 30, At December 31, 2022 2021 Amortization Gross Accumulated Gross Accumulated In thousands Customer lists / relationships 6-38 years $ 368,554 $ (37,818) $ 127,206 $ (35,096) Developed technologies 7-20 years 44,357 (16,113) 45,170 (13,591) Trademarks / trade names 15-40 years 16,284 (2,818) 16,982 (2,659) Non-compete agreements and other 1-15 years 17,813 (4,833) 4,629 (4,617) Patents 17 years 533 (481) 523 (473) Total intangible assets $ 447,541 $ (62,063) $ 194,510 $ (56,436) The increase in other intangible assets, net was primarily attributable to the acquisition of Aircraft Wheel and Brake. Refer to Note 4, Business Combinations and Investments |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Changes in Conversion Rate for Convertible Notes | The following table illustrates the conversion rate at the date of issuance of the 2024 Notes: 2024 Notes Conversion Rate per $1,000 principal amount (1) 15.3227 Conversion Price (2) 65.2626 Contingent Conversion Price (3) 84.8413 Aggregate shares to be issued upon conversion (4) 3,056,879 (1) Represents the number of shares of Common Stock hypothetically issuable per each $1,000 principal amount of 2024 Notes, subject to adjustments upon the occurrence of certain specified events in accordance with the terms of the Indenture. (2) Represents $1,000 divided by the conversion rate as of such date. The conversion price reflects the strike price of the embedded option within the 2024 Notes. If the Company's share price exceeds the conversion price at conversion, the noteholders would be entitled to receive additional consideration either in cash, shares or a combination thereof, the form of which is at the sole discretion of the Company. (3) Prior to November 1, 2023, the notes are convertible only in the following circumstances: (1) during any fiscal quarter commencing after July 1, 2017, and only during any such fiscal quarter, if the last reported sale price of the Company's common stock was greater than or equal to 130% of the applicable conversion price for at least 20 trading days (whether or not consecutive) during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter, (2) during the five consecutive business day period following any ten consecutive trading day period (the "measurement period") in which the trading price per $1,000 principal amount of 2024 Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company's common stock and the conversion rate on each such trading day or (3) upon the occurrence of specified corporate events. On or after November 1, 2023, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their notes at any time, regardless of the foregoing circumstances. If the Company undergoes a fundamental change (as defined in the Indenture), holders of the notes may require the Company to repurchase all or a portion of their notes for cash at a repurchase price equal to 100% of the principal amount to be repurchased, plus any accrued and unpaid interest. As of September 30, 2022, none of the conditions permitting the holders of the 2024 Notes to convert had been met. Therefore, the 2024 Notes are classified as long-term debt. (4) This represents the number of shares hypothetically issuable upon conversion of 100% of the outstanding aggregate principal amount of the 2024 Notes at each date; however, the terms of the 2024 Notes state that the Company may pay or deliver, as the case may be, cash, shares of the Company's common stock or a combination of cash and shares of common stock, at the Company's election. The Company currently intends to settle the aggregate principal amount in cash. Amounts due in excess of the principal, if any, also may be settled in cash, shares of the Company's common stock or a combination of cash and shares of common stock, at the Company's election. |
Schedule of Equity and Liability Components in Convertible Debt | The carrying amount of the equity component and the principal amount of the liability component, the unamortized discount and the net carrying value of the liability are as follows: 2024 Notes September 30, December 31, In thousands Principal amount of liability $ 199,500 $ 199,500 Unamortized discount (1) — 7,624 Carrying value of liability $ 199,500 $ 191,876 Equity component (1) $ — $ 20,408 |
Interest Expense Associated with Convertible Notes | Interest expense associated with the 2024 Notes consisted of the following: For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Contractual coupon rate of interest $ 1,621 $ 1,621 $ 4,863 $ 4,863 Accretion of convertible notes discount (1) — 707 — 2,191 Interest expense - convertible notes $ 1,621 $ 2,328 $ 4,863 $ 7,054 (1) In accordance with ASU 2020-06, entities that previously required separate accounting for conversion features will report less interest expense as those conversion features were recorded as debt discounts which were amortized over the term of the debt. Refer to Note 2, Recent Accounting Standards , for further information on the adoption of ASU 2020-06. |
Schedule of Line of Credit Facilities | The following table shows the amounts available for borrowing under the Company's revolving credit facility: September 30, December 31, In thousands Total facility $ 800,000 $ 800,000 Amounts outstanding, excluding letters of credit 412,000 — Amounts available for borrowing, excluding letters of credit 388,000 800,000 Letters of credit under the credit facility (1)(2) 51,630 92,646 Amounts available for borrowing $ 336,370 $ 707,354 Amounts available for borrowing subject to EBITDA, as defined by the Credit Agreement $ 30,221 $ 409,914 |
Schedule of Long-term Debt Instruments | The Company has long-term debt as follows: September 30, December 31, In thousands Revolving credit agreement (1) $ 412,000 $ — Convertible notes 199,500 191,876 Total 611,500 191,876 Less current portion — — Total excluding current portion $ 611,500 $ 191,876 |
Pension Plans (Tables)
Pension Plans (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | |
Schedule of Net Benefit Costs | Components of net pension cost for the Qualified Pension Plan and Supplemental Employees’ Retirement Plan ("SERP") were as follows: For the Three Months Ended Qualified Pension Plan SERP September 30, October 1, September 30, October 1, In thousands Service cost $ 840 $ 325 $ — $ — Interest cost on projected benefit obligation 4,300 3,541 22 16 Expected return on plan assets (10,544) (11,294) — — Amortization of net loss 1,064 1,111 16 14 Net pension (income) cost $ (4,340) $ (6,317) $ 38 $ 30 For the Nine Months Ended Qualified Pension Plan SERP September 30, October 1, September 30, October 1, In thousands Service cost $ 2,522 $ 976 $ — $ — Interest cost on projected benefit obligation 12,899 10,624 66 45 Expected return on plan assets (31,633) (33,883) — — Amortization of net loss 3,193 3,333 46 49 Net pension (income) cost $ (13,019) $ (18,950) $ 112 $ 94 |
Computation of Earnings Per S_2
Computation of Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share Reconciliation [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands, except per share amounts Net earnings $ 625 $ 14,667 $ 8,717 $ 34,507 Basic: Weighted average number of shares outstanding 28,037 27,882 27,997 27,855 Basic earnings per share $ 0.02 $ 0.53 $ 0.31 $ 1.24 Diluted (1) : Weighted average number of shares outstanding 28,037 27,882 27,997 27,855 Weighted average shares issuable on exercise of dilutive stock options 51 6 79 34 Total 28,088 27,888 28,076 27,889 Diluted earnings per share $ 0.02 $ 0.53 $ 0.31 $ 1.24 |
Share-based Arrangements (Table
Share-based Arrangements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |
Stock Option Activity | Stock option activity was as follows: For the Three Months Ended For the Nine Months Ended September 30, 2022 September 30, 2022 Options Weighted - average Options Weighted - average Options outstanding at beginning of period 726,691 $ 55.32 746,240 $ 55.14 Granted 39,121 $ 31.60 39,121 $ 31.60 Exercised (2,166) $ 42.86 (11,842) $ 41.90 Forfeited or expired (20,505) $ 54.53 (30,378) $ 55.35 Options outstanding at September 30, 2022 743,141 $ 54.10 743,141 $ 54.10 |
Fair Value Assumptions | The fair value of each option award is estimated on the date of grant using the Black-Scholes option valuation model. The following table indicates the weighted-average assumptions used in estimating fair value: For the Nine Months Ended September 30, 2022 October 1, 2021 Expected option term (years) 6.5 4.9 Expected volatility 35.5 % 35.7 % Risk-free interest rate 2.9 % 0.5 % Expected dividend yield 2.0 % 1.6 % Per share fair value of options granted $ 10.22 $ 14.89 |
Restricted Stock Award and Restricted Stock Unit Activity | Restricted stock award and restricted stock unit activity were as follows: For the Three Months Ended For the Nine Months Ended September 30, 2022 September 30, 2022 Restricted Stock Weighted- Restricted Stock Weighted- Restricted Stock outstanding at beginning of period 152,200 $ 47.87 135,351 $ 53.53 Granted 18,988 $ 31.60 119,003 $ 40.29 Vested (3,746) $ 50.98 (79,075) $ 49.85 Forfeited or expired (4,221) $ 51.21 (12,058) $ 51.41 Restricted Stock outstanding at September 30, 2022 163,221 $ 45.82 163,221 $ 45.82 |
Share-based Payment Arrangement, Performance Shares, Activity | Performance stock unit activity was as follows: For the Three Months Ended For the Nine Months Ended September 30, 2022 September 30, 2022 Performance Stock Weighted- Performance Stock Weighted- Performance Stock outstanding at beginning of period 180,120 $ 60.55 70,163 $ 70.17 Granted — $ — 117,885 $ 54.87 Vested — $ — — $ — Forfeited or expired (6,646) $ 63.87 (14,574) $ 61.29 Performance Stock outstanding at September 30, 2022 173,474 $ 60.42 173,474 $ 60.42 |
Schedule of Share-based Payment Awards, Performance Shares, Valuation Assumptions | The following table indicates the weighted-average assumptions used in estimating fair value: For the Nine Months Ended September 30, 2022 October 1, 2021 Expected term (years) 2.9 2.9 Expected volatility 39.4 % 41.3 % Risk-free interest rate 1.7 % 0.2 % Expected dividend yield 1.9 % 1.4 % Per share fair value of performance stock granted $ 68.10 $ 84.49 |
Shareholders' Equity and Accu_2
Shareholders' Equity and Accumulated Other Comprehensive Income (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Stockholders Equity | Changes in shareholders’ equity for the three-month and nine-month fiscal periods ended September 30, 2022, and October 1, 2021, were as follows: For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, In thousands Beginning balance $ 778,942 $ 779,212 796,329 746,438 Comprehensive (loss) income (8,429) 11,193 (14,154) 50,006 Dividends declared (per share of common stock, $0.20 and $0.20 and $0.60 and $0.60, respectively) (5,604) (5,569) (16,791) (16,696) Employee stock plans and related tax benefit 430 523 1,696 2,051 Purchase of treasury shares (64) (69) (762) (459) Share-based compensation expense 1,334 1,459 6,145 5,684 Impact of change in accounting standard — — (5,854) (275) Ending balance $ 766,609 $ 786,749 $ 766,609 $ 786,749 |
Schedule of Accumulated Other Comprehensive Income (Loss) | The components of accumulated other comprehensive income (loss) are shown below: For the Three Months Ended September 30, October 1, In thousands Foreign currency translation and other: Beginning balance $ (6,707) $ 16,515 Net loss on foreign currency translation (9,875) (4,342) Other comprehensive loss, net of tax (9,875) (4,342) Ending balance $ (16,582) $ 12,173 Pension and other post-retirement benefits (1) : Beginning balance $ (118,495) $ (128,363) Amortization of net loss, net of tax expense of $259 and $257, respectively 821 868 Other comprehensive income, net of tax 821 868 Ending balance $ (117,674) $ (127,495) Total accumulated other comprehensive loss $ (134,256) $ (115,322) (1) These accumulated other comprehensive income components are included in the computation of net periodic pension cost. (See Note 14, Pension Plans for additional information.) 18. SHAREHOLDERS' EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME (CONTINUED) For the Nine Months Ended September 30, October 1, In thousands Foreign currency translation and other: Beginning balance $ 8,772 $ (717) Net loss on foreign currency translation (25,354) (9,945) Reclassification to net income (1) — 22,835 Other comprehensive (loss) income, net of tax (25,354) 12,890 Ending balance $ (16,582) $ 12,173 Pension and other post-retirement benefits (2) : Beginning balance $ (120,157) $ (130,104) Amortization of net loss, net of tax expense of $756 and $773, respectively 2,483 2,609 Other comprehensive income, net of tax 2,483 2,609 Ending balance $ (117,674) $ (127,495) Total accumulated other comprehensive loss $ (134,256) $ (115,322) (1) The foreign currency translation reclassified to net income relates to the sale of the Company's UK Composites business. This balance was included in the loss accrual recorded in impairment on assets held for sale on the Company's Consolidated Statement of Operations in the year ended December 31, 2020. (See Note 3, Disposals , for additional information.) (2) These accumulated other comprehensive income components are included in the computation of net periodic pension cost. (See Note 14, Pension Plans for additional information.) |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rates | For the Three Months Ended For the Nine Months Ended September 30, October 1, September 30, October 1, Effective Income Tax Rate 17.0 % 23.3 % 18.6 % 22.7 % |
Recent Accounting Standards (De
Recent Accounting Standards (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Jan. 01, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | |||
Deferred income taxes | $ 15,711 | $ 17,487 | $ 15,717 |
Long-term debt, excluding current portion, net of debt issuance costs | 609,800 | 197,045 | 189,421 |
Additional paid-in capital | 243,330 | 235,664 | 248,153 |
Retained earnings | 749,007 | 757,080 | 750,445 |
Cumulative Effect Adjustment - ASU Adoption [Line Items] | |||
Deferred income taxes | 15,711 | 17,487 | 15,717 |
Long-term debt, excluding current portion, net of debt issuance costs | 609,800 | 197,045 | 189,421 |
Additional paid-in capital | 243,330 | 235,664 | 248,153 |
Retained earnings | $ 749,007 | 757,080 | $ 750,445 |
Accounting Standards Update 2020-06 Cumulative Effect, Period of Adoption | |||
Accounting Policies [Abstract] | |||
Deferred income taxes | 1,770 | ||
Long-term debt, excluding current portion, net of debt issuance costs | 7,624 | ||
Additional paid-in capital | 12,489 | ||
Retained earnings | 6,635 | ||
Cumulative Effect Adjustment - ASU Adoption [Line Items] | |||
Deferred income taxes | 1,770 | ||
Long-term debt, excluding current portion, net of debt issuance costs | 7,624 | ||
Additional paid-in capital | 12,489 | ||
Retained earnings | $ 6,635 |
Disposals (Details)
Disposals (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | 24 Months Ended | 37 Months Ended | |||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | Oct. 02, 2020 | Dec. 31, 2020 | Dec. 31, 2021 | Sep. 30, 2022 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Costs of Transaction Services Agreement | $ 0 | $ 24 | $ 0 | $ 1,728 | $ 18,900 | |||
Income from Transaction Services Agreement | 0 | (14) | 0 | (931) | (13,000) | |||
Proceeds from Divestiture of Businesses | $ 5,200 | |||||||
Gain (Loss) on Disposition of Business | (457) | $ 0 | (457) | 234 | ||||
UK Composites | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Gain (Loss) on Disposition of Business | 200 | $ 36,300 | $ 36,500 | |||||
Disposal Group, Including Discontinued Operation, Cash and Cash Equivalents | $ 6,600 | |||||||
Distribution | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Income from Transaction Services Agreement | 900 | |||||||
Mexico Operations | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Gain (Loss) on Disposition of Business | $ (500) | (500) | ||||||
Cash Outflows [Member] | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Discontinued Operation, Amount of Continuing Cash Flows after Disposal | $ 0 | 0 | 8,700 | |||||
Cash Inflows [Member] | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Discontinued Operation, Amount of Continuing Cash Flows after Disposal | $ 1,800 | $ 19,200 |
Business Combinations (Details)
Business Combinations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 16, 2022 | Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | Dec. 31, 2021 | Jan. 03, 2020 | |
Acquired Indefinite-lived Intangible Assets [Line Items] | |||||||
Equity Method Investments | $ 10,000 | $ 10,000 | |||||
Near Earth Autonomy | |||||||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||||||
Equity Method Investments | 10,000 | 10,000 | $ 0 | ||||
Bal Seal [Member] | |||||||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | $ 317,500 | ||||||
Parker Aircraft Wheels & Brakes | |||||||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | $ 441,340 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents | 0 | ||||||
Business Combination, Consideration Transferred | 441,340 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables | 7,635 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Contract Assets | 171 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory | 11,246 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 7,686 | ||||||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | 162,390 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 257,900 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities | 41 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | (5,729) | ||||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 2,700 | 2,700 | |||||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | (1,100) | (1,100) | |||||
Business Acquisition, Pro Forma Revenue | 188,554 | $ 197,154 | 543,817 | $ 584,693 | |||
Business Acquisition, Pro Forma Net Income (Loss) | 9,855 | 13,553 | 18,384 | 19,475 | |||
Pro Forma Adjustment, Increase in Finite-Lived Assets Amortization | 1,800 | 3,800 | 7,900 | 11,300 | |||
Pro Forma Adjustment, Increase in Depreciation Expense | 100 | 200 | 500 | 500 | |||
Pro Forma Adjustment, Increase in Interest Expense | 3,400 | 4,100 | 11,400 | 12,200 | |||
Pro Forma Adjustment, Reduction in Income Tax Expense | $ (1,700) | (1,600) | (8,000) | ||||
Pro Forma Adjustment, Increase in Cost of Sales associated with Inventory Step-Up | 2,300 | ||||||
Pro Forma Adjustment, Increase in Income Tax Expense | 1,000 | ||||||
Pro Forma Adjustment, Reduction in Selling, General & Administrative Costs | $ (10,100) | $ (12,100) | |||||
Pro Forma Adjustment, Increase in Selling, General & Administrative Costs | $ 12,100 | ||||||
Parker Aircraft Wheels & Brakes | Customer Relationships [Member] | |||||||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 244,500 | ||||||
Finite-Lived Intangible Asset, Useful Life | 24 years | ||||||
Parker Aircraft Wheels & Brakes | Order or Production Backlog [Member] | |||||||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 13,400 | ||||||
Finite-Lived Intangible Asset, Useful Life | 2 years |
Business Combinations Retention
Business Combinations Retention Plans (Details) $ in Millions | Jan. 03, 2020 USD ($) |
Bal Seal [Member] | |
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | |
Restricted Cash, Current | $ 24.7 |
Segment and Geographic Inform_3
Segment and Geographic Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 172,004 | $ 179,836 | $ 490,818 | $ 533,846 | |
Operating Income (Loss) | $ 446 | $ 15,962 | $ 5,783 | $ 36,407 | |
Revenue, Net, Percentage | 100% | 100% | 100% | 100% | |
Research and Development Expense | $ 3,937 | $ 2,540 | $ 14,265 | $ 10,004 | |
Assets | 1,564,534 | 1,564,534 | $ 1,198,482 | ||
Military and Defense, other than fuzes [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | 39,332 | 43,017 | 102,631 | 126,408 | |
Missile and Bomb Fuzes [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 37,460 | $ 49,393 | $ 96,345 | $ 148,985 | |
Revenue, Net, Percentage | 22% | 27% | 20% | 28% | |
Commercial Aerospace [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 53,315 | $ 44,746 | $ 161,131 | $ 133,834 | |
Medical [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | 23,641 | 21,996 | 71,769 | 65,441 | |
Other [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 18,256 | $ 20,684 | $ 58,942 | $ 59,178 | |
Original Equipment Manufacturer [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue, Net, Percentage | 61% | 56% | 64% | 58% | |
Aftermarket [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue, Net, Percentage | 17% | 17% | 16% | 14% | |
Engineered Products | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 92,052 | $ 84,399 | $ 263,269 | $ 235,134 | |
Operating Income (Loss) | $ 14,156 | $ 14,931 | $ 40,665 | $ 29,595 | |
Revenue, Net, Percentage | 54% | 47% | 53% | 44% | |
Research and Development Expense | $ 2,106 | $ 1,826 | $ 6,470 | $ 6,429 | |
Assets | 1,044,671 | 1,044,671 | 623,899 | ||
Engineered Products | Military and Defense, other than fuzes [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | 13,356 | 15,856 | 32,351 | 38,941 | |
Engineered Products | Missile and Bomb Fuzes [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 0 | $ 0 | $ 0 | $ 0 | |
Revenue, Net, Percentage | 0% | 0% | 0% | 0% | |
Engineered Products | Commercial Aerospace [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 39,852 | $ 29,711 | $ 109,874 | $ 81,643 | |
Engineered Products | Medical [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | 21,782 | 20,123 | 65,614 | 59,800 | |
Engineered Products | Other [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 17,062 | $ 18,709 | $ 55,430 | $ 54,750 | |
Engineered Products | Original Equipment Manufacturer [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue, Net, Percentage | 40% | 35% | 41% | 34% | |
Engineered Products | Aftermarket [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue, Net, Percentage | 14% | 12% | 12% | 10% | |
Precision Products | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 46,282 | $ 63,584 | $ 135,098 | $ 195,656 | |
Operating Income (Loss) | $ 5,730 | $ 13,792 | $ 11,689 | $ 46,274 | |
Revenue, Net, Percentage | 27% | 35% | 28% | 37% | |
Research and Development Expense | $ 1,812 | $ 540 | $ 7,599 | $ 3,378 | |
Assets | 289,680 | 289,680 | 250,146 | ||
Precision Products | Military and Defense, other than fuzes [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | 5,171 | 7,263 | 17,122 | 21,516 | |
Precision Products | Missile and Bomb Fuzes [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 37,460 | $ 49,393 | $ 96,345 | $ 148,985 | |
Revenue, Net, Percentage | 22% | 27% | 20% | 28% | |
Precision Products | Commercial Aerospace [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 2,457 | $ 4,953 | $ 18,119 | $ 20,727 | |
Precision Products | Medical [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | 0 | 0 | 0 | 0 | |
Precision Products | Other [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 1,194 | $ 1,975 | $ 3,512 | $ 4,428 | |
Precision Products | Original Equipment Manufacturer [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue, Net, Percentage | 2% | 3% | 4% | 5% | |
Precision Products | Aftermarket [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue, Net, Percentage | 3% | 5% | 4% | 4% | |
Structures | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 33,670 | $ 31,853 | $ 92,451 | $ 103,056 | |
Operating Income (Loss) | $ 71 | $ 330 | $ (1,376) | $ (871) | |
Revenue, Net, Percentage | 19% | 18% | 19% | 19% | |
Research and Development Expense | $ 19 | $ 174 | $ 196 | $ 197 | |
Assets | 133,232 | 133,232 | 125,027 | ||
Structures | Military and Defense, other than fuzes [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | 20,805 | 19,898 | 53,158 | 65,951 | |
Structures | Missile and Bomb Fuzes [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 0 | $ 0 | $ 0 | $ 0 | |
Revenue, Net, Percentage | 0% | 0% | 0% | 0% | |
Structures | Commercial Aerospace [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 11,006 | $ 10,082 | $ 33,138 | $ 31,464 | |
Structures | Medical [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | 1,859 | 1,873 | 6,155 | 5,641 | |
Structures | Other [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 0 | $ 0 | $ 0 | $ 0 | |
Structures | Original Equipment Manufacturer [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue, Net, Percentage | 19% | 18% | 19% | 19% | |
Structures | Aftermarket [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue, Net, Percentage | 0% | 0% | 0% | 0% | |
Corporate Segment | |||||
Disaggregation of Revenue [Line Items] | |||||
Operating Income (Loss) | $ (20,196) | $ (10,487) | $ (42,728) | $ (31,166) | |
Assets | 96,951 | 96,951 | $ 199,410 | ||
Other unallocated expenses, net | |||||
Disaggregation of Revenue [Line Items] | |||||
Operating Income (Loss) | $ 685 | $ (2,604) | $ (2,467) | $ (7,425) |
Revenue Changes in Revenue due
Revenue Changes in Revenue due to Estimates in Over Time Contracts (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
Change in Accounting Estimate [Line Items] | ||||
Net sales | $ 172,004 | $ 179,836 | $ 490,818 | $ 533,846 |
Performance obligations satisfied in previous periods [Member] | ||||
Change in Accounting Estimate [Line Items] | ||||
Reductions in Revenues | $ (892) | $ (937) | $ 580 | $ (1,518) |
Revenue Unfulfilled Performance
Revenue Unfulfilled Performance Obligations (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Unfulfilled Performance Obligations [Abstract] | ||
Revenue, Remaining Performance Obligation, Amount | $ 765,937 | $ 700,923 |
Revenue, Remaining Performance Obligation, Percentage | 65% | |
Disaggregation of Revenue [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 765,937 | 700,923 |
Engineered Products | ||
Unfulfilled Performance Obligations [Abstract] | ||
Revenue, Remaining Performance Obligation, Amount | 286,164 | 169,144 |
Disaggregation of Revenue [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 286,164 | 169,144 |
Precision Products | ||
Unfulfilled Performance Obligations [Abstract] | ||
Revenue, Remaining Performance Obligation, Amount | 175,332 | 180,082 |
Disaggregation of Revenue [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 175,332 | 180,082 |
Structures | ||
Unfulfilled Performance Obligations [Abstract] | ||
Revenue, Remaining Performance Obligation, Amount | 304,441 | 351,697 |
Disaggregation of Revenue [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 304,441 | $ 351,697 |
Restructuring Costs (Details)
Restructuring Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and severance costs | $ (243) | $ 2,611 | $ 2,853 | $ 5,479 |
Severance costs | 1,000 | |||
Executive Officer | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Severance costs | 2,200 | 2,200 | ||
G&A Reduction Effort [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Severance costs | $ (200) | $ 400 | $ 1,900 | $ 3,300 |
Accounts Receivable, Net - Sche
Accounts Receivable, Net - Schedule of Accounts Receivable, Net (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Less allowance for doubtful accounts | $ (1,498) | $ (1,547) |
Accounts receivable, net | 102,477 | 73,524 |
Accounts Receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable | 34,300 | 19,228 |
U.S. Government contracts | Billed | Accounts Receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable | 11,795 | 14,748 |
U.S. Government contracts | Not billed | Accounts Receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable | 847 | 167 |
Commercial and other government contracts | Billed | Accounts Receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable | 52,542 | 36,787 |
Commercial and other government contracts | Not billed | Accounts Receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable | $ 4,491 | $ 4,141 |
Accounts Receivable, Net Allowa
Accounts Receivable, Net Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Allowance for Doubtful Accounts [Abstract] | ||
Less allowance for doubtful accounts | $ (1,498) | $ (1,547) |
Provision for Other Credit Losses | (619) | |
Accounts Receivable, Allowance for Credit Loss, Additions due to Acquisitions | 67 | |
Accounts Receivable, Allowance for Credit Loss, Writeoff | 270 | |
Accounts Receivable, Allowance for Credit Loss, Recovery | 459 | |
Financing Receivable, Allowance for Credit Loss, Foreign Currency Translation | $ 6 |
Accounts Receivable, Net - Acco
Accounts Receivable, Net - Accounts Receivable due to contract changes, negotiated settlements and claims for unanticipated cost (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | ||
Contract changes, negotiated settlements and claims for unanticipated contract costs | $ 0 | $ 900 |
Contract Assets, Contract Cos_3
Contract Assets, Contract Costs and Contract Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||||
Contract assets | $ 117,828 | $ 117,828 | $ 112,354 | ||
Contract assets, change | $ 5,474 | ||||
Contract assets, change (as percent) | 4.90% | ||||
Contract costs, current portion | 822 | $ 822 | 850 | ||
Capitalized costs, current portion, change | $ (28) | ||||
Capitalized costs, current portion, change (as percent) | (3.30%) | ||||
Contract costs, noncurrent portion | 9,865 | $ 9,865 | 10,249 | ||
Capitalized costs, noncurrent portion, change | $ (384) | ||||
Capitalized costs, noncurrent portion, change (as percent) | (3.70%) | ||||
Contract liabilities, current portion | 3,932 | $ 3,932 | 2,945 | ||
Contract liabilities, current portion, change | $ 987 | ||||
Contract liabilities, current portion, change (as percent) | 33.50% | ||||
Contract liabilities, noncurrent portion | 20,477 | $ 20,477 | 16,528 | ||
Contract liabilities, noncurrent portion, change | $ 3,949 | ||||
Contract liabilities, noncurrent portion, change (as percent) | 23.90% | ||||
Capitalized contract cost, amortization | 200 | $ 1,700 | $ 500 | $ 6,900 | |
Revenue recognized related to contract liabilities | 200 | $ 18,300 | 1,400 | $ 38,800 | |
Contract changes, negotiated settlements and claims for unanticipated contract costs | |||||
Disaggregation of Revenue [Line Items] | |||||
Contract assets | 0 | 0 | 682 | ||
Costs to Fulfill [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Capitalized Contract Cost, Net | 10,700 | 10,700 | 11,100 | ||
Costs to Obtain [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Capitalized Contract Cost, Net | $ 0 | $ 0 | $ 0 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Financial Instruments not carried at Fair Value (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money Market Funds, at Carrying Value | $ 100 | $ 65,500 |
Goodwill, Impairment Loss | 0 | |
Level 2 | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt | 611,500 | 191,876 |
Level 2 | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt | $ 587,738 | $ 213,222 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventory (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 23,850 | $ 19,123 |
Contracts and other work in process (including certain general stock materials) | 159,664 | 138,737 |
Finished goods | 38,301 | 35,240 |
Inventories | $ 221,815 | $ 193,100 |
Inventories - Inventory Due to
Inventories - Inventory Due to Contract Changes, Negotiated Settlements and Claims for Unanticipated Contract Costs (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Contract changes, negotiated settlements and claims for unanticipated contract costs | $ 0 | $ 552 |
Inventories - Other Inventory I
Inventories - Other Inventory Information (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Schedule of Inventory [Line Items] | ||
Inventories | $ 221,815 | $ 193,100 |
K-MAX® | ||
Schedule of Inventory [Line Items] | ||
Inventory, gross | 72,400 | 69,200 |
Inventory noncurrent | 32,400 | |
SH 2GA Super Seasprite Program | ||
Schedule of Inventory [Line Items] | ||
Inventory, gross | 6,400 | $ 6,000 |
Inventory noncurrent | $ 4,500 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets, Net - Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Goodwill [Roll Forward] | ||
Gross balance at beginning of period | $ 307,240 | |
Accumulated impairment | $ (66,559) | (66,559) |
Net balance at beginning of period | 240,681 | |
Additions(1) | 162,390 | |
Impairments | 0 | |
Foreign currency translation | (12,337) | |
Net balance at end of period | 390,734 | 240,681 |
Engineered Products | ||
Goodwill [Roll Forward] | ||
Gross balance at beginning of period | 199,306 | |
Accumulated impairment | 0 | 0 |
Net balance at beginning of period | 199,306 | |
Additions(1) | 162,390 | |
Impairments | 0 | |
Foreign currency translation | (12,337) | |
Net balance at end of period | 349,359 | 199,306 |
Precision Products | ||
Goodwill [Roll Forward] | ||
Gross balance at beginning of period | 41,375 | |
Accumulated impairment | 0 | 0 |
Net balance at beginning of period | 41,375 | |
Additions(1) | 0 | |
Impairments | 0 | |
Foreign currency translation | 0 | |
Net balance at end of period | 41,375 | 41,375 |
Structures | ||
Goodwill [Roll Forward] | ||
Gross balance at beginning of period | 66,559 | |
Accumulated impairment | (66,559) | (66,559) |
Net balance at beginning of period | 0 | |
Additions(1) | 0 | |
Impairments | 0 | |
Foreign currency translation | 0 | |
Net balance at end of period | $ 0 | $ 0 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets, Net - Other Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 447,541 | $ 194,510 |
Accumulated Amortization | (62,063) | (56,436) |
Customer lists / relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 368,554 | 127,206 |
Accumulated Amortization | (37,818) | (35,096) |
Developed technologies | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 44,357 | 45,170 |
Accumulated Amortization | (16,113) | (13,591) |
Trademarks / trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 16,284 | 16,982 |
Accumulated Amortization | (2,818) | (2,659) |
Non-compete agreements and other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 17,813 | 4,629 |
Accumulated Amortization | $ (4,833) | (4,617) |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 17 years | |
Gross Amount | $ 533 | 523 |
Accumulated Amortization | $ (481) | $ (473) |
Minimum | Customer lists / relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 6 years | |
Minimum | Developed technologies | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 7 years | |
Minimum | Trademarks / trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 15 years | |
Minimum | Non-compete agreements and other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 1 year | |
Maximum | Customer lists / relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 38 years | |
Maximum | Developed technologies | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 20 years | |
Maximum | Trademarks / trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 40 years | |
Maximum | Non-compete agreements and other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 15 years |
Debt (Details)
Debt (Details) | 3 Months Ended | 9 Months Ended | ||||||||
May 12, 2017 USD ($) $ / shares | Sep. 30, 2022 USD ($) shares | Oct. 01, 2021 USD ($) | Sep. 30, 2022 USD ($) Integer shares | Oct. 01, 2021 USD ($) | May 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 13, 2019 USD ($) | Sep. 27, 2019 USD ($) | May 24, 2017 USD ($) $ / shares | |
Debt Disclosure [Abstract] | ||||||||||
Debt Instrument, Face Amount | $ 199,500,000 | |||||||||
Debt Instrument [Line Items] | ||||||||||
Capped Call Transaction Cap Price | $ / shares | $ 88.7570 | |||||||||
Purchase of call options related to convertible notes | $ 20,500,000 | |||||||||
Debt Instrument, Convertible, Debt Instrument | $ 179,500,000 | |||||||||
Debt Instrument, Interest Rate, Effective Percentage | 5% | |||||||||
Amortization of debt issuance costs | $ 1,882,000 | $ 1,406,000 | ||||||||
Debt Instrument, Face Amount | $ 199,500,000 | |||||||||
Accretion of convertible notes discount | $ 0 | 2,191,000 | ||||||||
Debt, Weighted Average Interest Rate | 3.72% | 3.72% | 3.25% | |||||||
Long-term Debt, Gross | $ 611,500,000 | $ 611,500,000 | $ 191,876,000 | |||||||
Long-term Debt, Current Maturities before Debt Issuance Costs | 0 | 0 | 0 | |||||||
Long-term Debt, Gross, Excluding Current Maturities | 611,500,000 | 611,500,000 | 191,876,000 | |||||||
Debt Issuance Costs, Net | $ 1,700,000 | $ 1,700,000 | 2,500,000 | |||||||
Credit Agreement 2019 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt Instrument, Basis Points | 1 | 1 | ||||||||
Consolidated Total Indebtedness to Consolidated EBITDA, Ratio | 4 | 4 | ||||||||
Consideration for Permitted Acquisition under Credit Agreement, Number of Consecutive Quarters | 4 | 4 | ||||||||
Total Consolidated Leverage Ratio, pre-amendment | 4.50 | 4.50 | ||||||||
Consolidated Total Leverage Ratio, First Anniversary | 5 | 5 | ||||||||
Consolidated Total Leverage Ratio, Second Anniversary | 4.50 | 4.50 | ||||||||
Consolidated Total Leverage Ratio, Between First and Second Anniversaries | 4.75 | 4.75 | ||||||||
2024 Notes | ||||||||||
Debt Disclosure [Abstract] | ||||||||||
Debt Instrument, Face Amount | $ 199,500,000 | $ 199,500,000 | $ 200,000,000 | |||||||
Debt Instrument, Face Amount Before Overallotment | 175,000,000 | |||||||||
Debt Instrument Face Amount Overallotment | $ 25,000,000 | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.25% | |||||||||
Multiple, Debt Instrument | $ 1,000 | $ 1,000 | ||||||||
Debt Instrument, Repurchased Face Amount | $ 500,000 | |||||||||
Percent, Debt Instrument, Repurchase Amount | 0.25% | |||||||||
Debt Instrument, Convertible, Conversion Ratio | 15.3227 | |||||||||
Debt Instrument [Line Items] | ||||||||||
Debt Instrument, Convertible, Conversion Ratio | 15.3227 | |||||||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 65.2626 | |||||||||
Debt Instrument, Convertible, Contingent Conversion Price | $ / shares | $ 84.8413 | |||||||||
Aggregate shares to be issued upon conversion, convertible | shares | 3,056,879 | 3,056,879 | ||||||||
Multiple, Debt Instrument | $ 1,000 | $ 1,000 | ||||||||
Debt Instrument, Convertible, Threshold Percentage of Stock Price Trigger | 130% | |||||||||
Debt Instrument, Convertible, Threshold Trading Days | Integer | 20 | |||||||||
Debt Instrument, Convertible, Threshold Consecutive Trading Days | Integer | 30 | |||||||||
Conversion Feature, Percentage of Average of Closing Sale Price of Common Stock | 98% | |||||||||
Conversion Feature, Repurchase Price Percentage of Principal Amount | 100% | |||||||||
Debt Issuance Costs, Gross | $ 7,400,000 | |||||||||
Debt Issuance Costs, Recorded to APIC | 700,000 | |||||||||
Debt Issuance Costs, Recorded as Contra-debt | 6,700,000 | |||||||||
Amortization of debt issuance costs | $ 300,000 | $ 300,000 | $ 800,000 | 800,000 | ||||||
Debt Instrument, Face Amount | 199,500,000 | 199,500,000 | $ 200,000,000 | |||||||
Debt Instrument, Unamortized Discount | 0 | 0 | 7,624,000 | |||||||
Convertible Debt | 199,500,000 | 199,500,000 | 191,876,000 | |||||||
Debt Instrument, Convertible, Carrying Amount of Equity Component | 0 | 0 | 20,408,000 | |||||||
Contractual coupon rate of interest, associated interest expense | 1,621,000 | 1,621,000 | 4,863,000 | 4,863,000 | ||||||
Accretion of convertible notes discount | 0 | 707,000 | 0 | 2,191,000 | ||||||
Interest Expense, Debt | 1,621,000 | 2,328,000 | 4,863,000 | 7,054,000 | ||||||
Percent, Debt Instrument, Repurchase Amount | 0.25% | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.25% | |||||||||
Debt Instrument, Face Amount Before Overallotment | $ 175,000,000 | |||||||||
Debt Instrument Face Amount Overallotment | $ 25,000,000 | |||||||||
Debt Instrument, Repurchased Face Amount | $ 500,000 | |||||||||
Revolving Credit Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Amortization of debt issuance costs | 700,000 | $ 200,000 | 1,200,000 | $ 600,000 | ||||||
Long-term Debt, Gross | 412,000,000 | 412,000,000 | 0 | |||||||
Revolving Credit Facility [Member] | Credit Agreement 2019 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | 800,000,000 | 800,000,000 | 800,000,000 | $ 800,000,000 | ||||||
Long-term Line of Credit | 412,000,000 | 412,000,000 | 0 | |||||||
Line of Credit Facility Remaining Borrowing Capacity Excluding LOCs | 388,000,000 | 388,000,000 | 800,000,000 | |||||||
Letters of Credit Outstanding, Amount | 51,630,000 | 51,630,000 | 92,646,000 | |||||||
Line of Credit Facility, Remaining Borrowing Capacity | 336,370,000 | 336,370,000 | 707,354,000 | |||||||
Line of Credit Facility Remaining Borrowing Capacity subject to EBITDA limitations | 30,221,000 | 30,221,000 | 409,914,000 | |||||||
Debt Issuance Costs, Line of Credit Arrangements, Gross | $ 4,200,000 | $ 3,600,000 | ||||||||
Revolving Credit Facility [Member] | Letter of Credit | JPF | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Letters of Credit Outstanding, Amount | 46,100,000 | 46,100,000 | 86,300,000 | |||||||
Convertible Debt | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Long-term Debt, Gross | $ 199,500,000 | $ 199,500,000 | $ 191,876,000 |
Pension Plans - Pension plan ne
Pension Plans - Pension plan net periodic benefit costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
Qualified Pension Plan | ||||
Defined Benefit Plan Disclosure | ||||
Service cost | $ (840) | $ (325) | $ (2,522) | $ (976) |
Interest cost on projected benefit obligation | 4,300 | 3,541 | 12,899 | 10,624 |
Expected return on plan assets | (10,544) | (11,294) | (31,633) | (33,883) |
Amortization of net loss | 1,064 | 1,111 | 3,193 | 3,333 |
Net pension (income) cost | (4,340) | (6,317) | (13,019) | (18,950) |
SERP | ||||
Defined Benefit Plan Disclosure | ||||
Service cost | 0 | 0 | 0 | 0 |
Interest cost on projected benefit obligation | 22 | 16 | 66 | 45 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Amortization of net loss | 16 | 14 | 46 | 49 |
Net pension (income) cost | $ 38 | $ 30 | $ 112 | $ 94 |
Pension Plans - Contributions (
Pension Plans - Contributions (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Oct. 01, 2021 | |
Qualified Pension Plan | ||
Defined Benefit Plans and Other Postretirement Benefit Plans | ||
Contributions paid-to-date | $ 10 | |
Expected future contributions | $ 0 | |
SERP | ||
Defined Benefit Plans and Other Postretirement Benefit Plans | ||
Contributions paid-to-date | 0.4 | $ 2.7 |
Expected future contributions | $ 0.1 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Loss Contingencies [Line Items] | |
Notional Value of Contract, Percent | 60% |
Offset Agreement | |
Loss Contingencies [Line Items] | |
Notional amount | $ 220.9 |
Estimate of possible loss | 18.8 |
Contract with Customer, Liability | 17.7 |
New Hartford | |
Loss Contingencies [Line Items] | |
Estimate of environmental remediation cost | 2.3 |
Payments for environmental remediation | 1.7 |
New Hartford | Other accruals and payables | |
Loss Contingencies [Line Items] | |
Estimate of environmental remediation cost | 0.1 |
New Hartford | Accruals and payables and other long-term liabilties | |
Loss Contingencies [Line Items] | |
Estimate of environmental remediation cost | 0.6 |
Bloomfield | |
Loss Contingencies [Line Items] | |
Estimate of environmental remediation cost | 2 |
Payments for environmental remediation | 15.4 |
Environmental liability | 10.3 |
Estimated remediation liability | $ 20.8 |
Discount rate (as a percent) | 8% |
Bloomfield | Other accruals and payables | |
Loss Contingencies [Line Items] | |
Estimate of environmental remediation cost | $ 0.3 |
Pension Costs | |
Loss Contingencies [Line Items] | |
Accrual for claims | $ 0.3 |
Computation of Earnings Per S_3
Computation of Earnings Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
Earnings Per Share Reconciliation [Abstract] | ||||
Net earnings | $ 625 | $ 14,667 | $ 8,717 | $ 34,507 |
Basic: | ||||
Weighted average number of shares outstanding (in shares) | 28,037 | 27,882 | 27,997 | 27,855 |
Basic earnings per share (in usd per share) | $ 0.02 | $ 0.53 | $ 0.31 | $ 1.24 |
Diluted(1): | ||||
Weighted average shares issuable on exercise of dilutive stock options (in shares) | 51 | 6 | 79 | 34 |
Diluted (in shares) | 28,088 | 27,888 | 28,076 | 27,889 |
Diluted earnings per share (in usd per share) | $ 0.02 | $ 0.53 | $ 0.31 | $ 1.24 |
Computation of Earnings Per S_4
Computation of Earnings Per Share - Narrative (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
2024 Notes | ||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||||
Aggregate shares to be issued upon conversion, convertible | 3,056,879 | 3,056,879 | ||
Stock Compensation Plan | ||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||||
Antidilutive securities excluded from EPS | 756,809 | 650,554 | 707,584 | 524,617 |
Share-based Arrangements - Comp
Share-based Arrangements - Compensation Arrangements by Share-based Payment Award (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Stock compensation expense | $ 1,334 | $ 1,459 | $ 6,145 | $ 5,684 |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 100% | 100% | ||
2021 PSUs | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 33% | |||
Selling, General and Administrative Expenses [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Stock compensation expense | $ 1,300 | 1,500 | $ 6,100 | $ 5,700 |
Employee Severance | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Stock compensation expense | $ 100 | $ 200 | $ 300 |
Share-based Arrangements - Stoc
Share-based Arrangements - Stock Options Activity (Details) - Stock Options - $ / shares | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2022 | Oct. 01, 2021 | Jul. 01, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||||
Outstanding at beginning of the period (in shares) | 726,691 | 746,240 | |||
Granted (in shares) | 39,121 | 39,121 | |||
Exercised (in shares) | (2,166) | (11,842) | |||
Forfeited or expired (in shares) | (20,505) | (30,378) | |||
Outstanding at end of period (in shares) | 743,141 | 743,141 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |||||
Options outstanding at beginning of period, Weighted-average exercise price (in usd per share) | $ 54.10 | $ 54.10 | $ 55.32 | $ 55.14 | |
Granted, Weighted-average exercise price (in usd per share) | 31.60 | 31.60 | |||
Exercised, Weighted-average exercise price (in usd per share) | 42.86 | 41.90 | |||
Forfeited or expired, Weighted average exercise price (in usd per share) | 54.53 | 55.35 | |||
Options outstanding end of period, Weighted-average exercise price (in usd per share) | $ 54.10 | $ 54.10 | $ 55.32 | $ 55.14 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |||||
Expected option term | 6 years 6 months | 4 years 10 months 24 days | |||
Expected volatility | 35.50% | 35.70% | |||
Risk-free interest rate | 2.90% | 0.50% | |||
Expected dividend yield | 2% | 1.60% | |||
Per share fair value of options granted (in usd per share) | $ 10.22 | $ 14.89 |
Share-based Arrangements - Rest
Share-based Arrangements - Restricted Stock Activity (Details) - Restricted Stock Awards - $ / shares | 3 Months Ended | 9 Months Ended |
Sep. 30, 2022 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Restricted Stock outstanding at beginning of the period (in shares) | 152,200 | 135,351 |
Granted (in shares) | 18,988 | 119,003 |
Vested (in shares) | (3,746) | (79,075) |
Forfeited or expired (in shares) | (4,221) | (12,058) |
Restricted Stock outstanding at end of period (in shares) | 163,221 | 163,221 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Restricted Stock outstanding at beginning of period, Weighted-average grant date fair value (usd per share) | $ 47.87 | $ 53.53 |
Granted, Weighted Average Grant Date Fair Value (usd per share) | 31.60 | 40.29 |
Vested, Weighted Average Grant Date Fair Value (usd per share) | 50.98 | 49.85 |
Forfeited or expired, Weighted Average Grant Date Fair Value (usd per share) | 51.21 | 51.41 |
Restricted Stock outstanding at end of period Weighted-average grant date fair value (usd per share) | $ 45.82 | $ 45.82 |
Share-based Arrangements Perfor
Share-based Arrangements Performance Shares (Details) - $ / shares | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2022 | Oct. 01, 2021 | Jul. 01, 2022 | Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 100% | 100% | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 100% | 100% | |||
Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Expected option term | 6 years 6 months | 4 years 10 months 24 days | |||
Expected volatility | 35.50% | 35.70% | |||
Risk-free interest rate | 2.90% | 0.50% | |||
Expected dividend yield | 2% | 1.60% | |||
Per share fair value of options granted (in usd per share) | $ 10.22 | $ 14.89 | |||
Restricted Stock Awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 163,221 | 163,221 | 152,200 | 135,351 | |
Granted (in shares) | 18,988 | 119,003 | |||
Vested (in shares) | (3,746) | (79,075) | |||
Forfeited or expired (in shares) | (4,221) | (12,058) | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 45.82 | $ 45.82 | $ 47.87 | $ 53.53 | |
Granted, Weighted Average Grant Date Fair Value (usd per share) | 31.60 | 40.29 | |||
Vested, Weighted Average Grant Date Fair Value (usd per share) | 50.98 | 49.85 | |||
Forfeited or expired, Weighted Average Grant Date Fair Value (usd per share) | $ 51.21 | $ 51.41 | |||
Performance Shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 173,474 | 173,474 | 180,120 | 70,163 | |
Granted (in shares) | 0 | 117,885 | |||
Vested (in shares) | 0 | 0 | |||
Forfeited or expired (in shares) | (6,646) | (14,574) | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 60.42 | $ 60.42 | $ 60.55 | $ 70.17 | |
Granted, Weighted Average Grant Date Fair Value (usd per share) | 0 | 54.87 | |||
Vested, Weighted Average Grant Date Fair Value (usd per share) | 0 | 0 | |||
Forfeited or expired, Weighted Average Grant Date Fair Value (usd per share) | $ 63.87 | $ 61.29 | |||
Expected option term | 2 years 10 months 24 days | 2 years 10 months 24 days | |||
Expected volatility | 39.40% | 41.30% | |||
Risk-free interest rate | 1.70% | 0.20% | |||
Expected dividend yield | 1.90% | 1.40% | |||
Per share fair value of options granted (in usd per share) | $ 68.10 | $ 84.49 |
Shareholders' Equity and Accu_3
Shareholders' Equity and Accumulated Other Comprehensive Income - Changes in Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
Schedule of Capitalization, Equity [Line Items] | ||||
Common Stock, Dividends, Per Share, Declared | $ 0.20 | $ 0.20 | $ 0.60 | $ 0.60 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | $ 778,942 | $ 779,212 | $ 796,329 | $ 746,438 |
Comprehensive (loss) income | (8,429) | 11,193 | (14,154) | 50,006 |
Dividends declared (per share of common stock, $0.20 and $0.20 and $0.60 and $0.60, respectively) | (5,604) | (5,569) | (16,791) | (16,696) |
Employee stock plans and related tax benefit | 430 | 523 | 1,696 | 2,051 |
Purchase of treasury shares | (64) | (69) | (762) | (459) |
Share-based compensation expense | 1,334 | 1,459 | 6,145 | 5,684 |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (9,875) | (4,342) | (25,354) | (9,945) |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | 0 | (275) | ||
Ending balance | 766,609 | $ 786,749 | 766,609 | $ 786,749 |
Accounting Standards Update 2020-06 Cumulative Effect, Period of Adoption | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | $ 0 | $ (5,854) |
Shareholders' Equity and Accu_4
Shareholders' Equity and Accumulated Other Comprehensive Income - Accumulated Other Comprehensive Income (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, Net of Tax | $ 0 | $ 22,835 | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 778,942 | $ 779,212 | 796,329 | 746,438 |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (9,875) | (4,342) | (25,354) | (9,945) |
Other comprehensive (loss) income | (9,054) | (3,474) | (22,871) | 15,499 |
Ending balance | 766,609 | 786,749 | 766,609 | 786,749 |
Other Comprehensive Income (Loss), Defined Benefit Plan, Gain (Loss), Reclassification Adjustment from AOCI, Tax | $ 259 | $ 257 | $ 756 | $ 773 |
Common Stock, Dividends, Per Share, Declared | $ 0.20 | $ 0.20 | $ 0.60 | $ 0.60 |
Total accumulated other comprehensive loss | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Ending balance | $ (134,256) | $ (115,322) | $ (134,256) | $ (115,322) |
Foreign currency translation | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (6,707) | 16,515 | 8,772 | (717) |
Other comprehensive (loss) income | (9,875) | (4,342) | (25,354) | 12,890 |
Ending balance | (16,582) | 12,173 | (16,582) | 12,173 |
Pension and other post-retirement benefits | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Reclassification from AOCI, Current Period, Net of Tax, Attributable to Parent | 821 | 868 | 2,483 | 2,609 |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (118,495) | (128,363) | (120,157) | (130,104) |
Other comprehensive (loss) income | 821 | 868 | 2,483 | 2,609 |
Ending balance | $ (117,674) | $ (127,495) | $ (117,674) | $ (127,495) |
Income Taxes - Effective Income
Income Taxes - Effective Income Tax Rate (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Sep. 30, 2022 | Oct. 01, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Effective Income Tax Rate | 17% | 23.30% | 18.60% | 22.70% |