Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 30, 2019 | Aug. 05, 2019 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | POWELL INDUSTRIES INC | |
Entity Central Index Key | 0000080420 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Shell Company | false | |
Entity Current Reporting Status | Yes | |
Entity Common Stock, Shares Outstanding | 11,566,748 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Current Assets: | ||
Cash and cash equivalents | $ 71,921 | $ 36,584 |
Short-term investments | 6,109 | 13,170 |
Restricted cash | 8,188 | 19,154 |
Accounts receivable, less allowance for doubtful accounts of $205 and $157 | 108,551 | 92,548 |
Contract assets | 57,231 | 82,545 |
Inventories | 29,484 | 21,352 |
Income taxes receivable | 72 | 6,904 |
Prepaid expenses | 3,316 | 3,775 |
Other current assets | 2,398 | 630 |
Total Current Assets | 287,270 | 276,662 |
Property, plant and equipment, net | 121,909 | 128,764 |
Restricted cash | 8,476 | 5,987 |
Goodwill and intangible assets, net | 1,381 | 1,514 |
Deferred income taxes | 6,960 | 5,937 |
Other assets | 11,110 | 11,087 |
Total Assets | 437,106 | 429,951 |
Current Liabilities: | ||
Current maturities of long-term debt | 400 | 400 |
Accounts payable | 38,483 | 40,714 |
Contract liabilities | 60,868 | 43,174 |
Accrued compensation and benefits | 16,078 | 22,274 |
Accrued product warranty | 3,180 | 2,604 |
Income taxes payable | 507 | 897 |
Other current liabilities | 10,285 | 7,786 |
Total Current Liabilities | 129,801 | 117,849 |
Long-term debt, net of current maturities | 800 | 1,200 |
Deferred compensation | 6,497 | 5,902 |
Other long-term liabilities | 4,349 | 3,356 |
Total Liabilities | 141,447 | 128,307 |
Commitments and Contingencies (Note F) | ||
Stockholders' Equity: | ||
Preferred stock, par value $.01; 5,000,000 shares authorized; none issued | 0 | 0 |
Common stock, par value $.01; 30,000,000 shares authorized; 12,358,566 and 12,280,556 shares issued, respectively | 124 | 123 |
Additional paid-in capital | 57,838 | 56,769 |
Retained earnings | 285,891 | 291,530 |
Treasury stock, 806,018 shares at cost | (24,999) | (24,999) |
Accumulated other comprehensive loss | (23,195) | (21,779) |
Total Stockholders' Equity | 295,659 | 301,644 |
Total Liabilities and Stockholders' Equity | $ 437,106 | $ 429,951 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 205 | $ 157 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 30,000,000 | 30,000,000 |
Common stock, shares issued (in shares) | 12,358,566 | 12,280,556 |
Treasury stock, shares (in shares) | 806,018 | 806,018 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Statement [Abstract] | ||||
Revenues | $ 135,588 | $ 122,130 | $ 368,676 | $ 313,819 |
Cost of goods sold | 111,873 | 103,755 | 310,255 | 272,469 |
Gross profit | 23,715 | 18,375 | 58,421 | 41,350 |
Selling, general and administrative expenses | 17,117 | 16,174 | 50,240 | 48,462 |
Research and development expenses | 1,631 | 1,632 | 4,988 | 4,926 |
Amortization of intangible assets | 44 | 44 | 132 | 161 |
Insurance proceeds | (950) | 0 | (950) | 0 |
Restructuring and other, net | 233 | 0 | 233 | 0 |
Operating income (loss) | 5,640 | 525 | 3,778 | (12,199) |
Other income | 0 | 0 | 0 | (507) |
Interest expense | 59 | 51 | 170 | 153 |
Interest income | (305) | (215) | (707) | (711) |
Income (loss) before income taxes | 5,886 | 689 | 4,315 | (11,134) |
Income tax expense (benefit) | 797 | 388 | 963 | (2,443) |
Net income (loss) | $ 5,089 | $ 301 | $ 3,352 | $ (8,691) |
Income (loss) per share: | ||||
Basic (in dollars per share) | $ 0.44 | $ 0.03 | $ 0.29 | $ (0.76) |
Diluted (in dollars per share) | $ 0.44 | $ 0.03 | $ 0.29 | $ (0.76) |
Weighted average shares: | ||||
Basic (in shares) | 11,579 | 11,514 | 11,567 | 11,503 |
Diluted (in shares) | 11,603 | 11,587 | 11,589 | 11,503 |
Dividends per share (in dollars per share) | $ 0.26 | $ 0.26 | $ 0.78 | $ 0.78 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 5,089 | $ 301 | $ 3,352 | $ (8,691) |
Foreign currency translation adjustments | 952 | (2,543) | (1,416) | (4,132) |
Comprehensive income (loss) | $ 6,041 | $ (2,242) | $ 1,936 | $ (12,823) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Treasury Stock | Acummulated Other Comprehensive Income |
Balance (in shares) at Sep. 30, 2017 | 12,234 | (806) | ||||
Balance at Sep. 30, 2017 | $ 321,296 | $ 122 | $ 54,329 | $ 310,598 | $ (24,999) | $ (18,754) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (5,662) | (5,662) | ||||
Foreign currency translation adjustments | (314) | (314) | ||||
Stock-based compensation (in shares) | 23 | |||||
Stock-based compensation | 1,069 | 1,069 | ||||
Shares withheld in lieu of employee tax withholding | (438) | (438) | ||||
Dividends paid | (2,977) | (2,977) | ||||
Balance (in shares) at Dec. 31, 2017 | 12,257 | (806) | ||||
Balance at Dec. 31, 2017 | 312,974 | $ 122 | 54,960 | 301,959 | $ (24,999) | (19,068) |
Balance (in shares) at Sep. 30, 2017 | 12,234 | (806) | ||||
Balance at Sep. 30, 2017 | 321,296 | $ 122 | 54,329 | 310,598 | $ (24,999) | (18,754) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (8,691) | |||||
Foreign currency translation adjustments | (4,132) | |||||
Balance (in shares) at Jun. 30, 2018 | 12,276 | (806) | ||||
Balance at Jun. 30, 2018 | 301,447 | $ 123 | 56,235 | 292,974 | $ (24,999) | (22,886) |
Balance (in shares) at Dec. 31, 2017 | 12,257 | (806) | ||||
Balance at Dec. 31, 2017 | 312,974 | $ 122 | 54,960 | 301,959 | $ (24,999) | (19,068) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (3,330) | (3,330) | ||||
Foreign currency translation adjustments | (1,275) | (1,275) | ||||
Stock-based compensation | 998 | 998 | ||||
Issuance of restricted stock (In shares) | 12 | |||||
Issuance of restricted stock | 1 | $ 1 | ||||
Dividends paid | (2,976) | (2,976) | ||||
Balance (in shares) at Mar. 31, 2018 | 12,269 | (806) | ||||
Balance at Mar. 31, 2018 | 306,392 | $ 123 | 55,958 | 295,653 | $ (24,999) | (20,343) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 301 | 301 | ||||
Foreign currency translation adjustments | (2,543) | (2,543) | ||||
Stock-based compensation (in shares) | 5 | |||||
Stock-based compensation | 417 | 417 | ||||
Shares withheld in lieu of employee tax withholding | (140) | (140) | ||||
Issuance of restricted stock (In shares) | 2 | |||||
Issuance of restricted stock | 0 | |||||
Dividends paid | (2,980) | (2,980) | ||||
Balance (in shares) at Jun. 30, 2018 | 12,276 | (806) | ||||
Balance at Jun. 30, 2018 | 301,447 | $ 123 | 56,235 | 292,974 | $ (24,999) | (22,886) |
Balance (in shares) at Sep. 30, 2018 | 12,281 | (806) | ||||
Balance at Sep. 30, 2018 | 301,644 | $ 123 | 56,769 | 291,530 | $ (24,999) | (21,779) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (2,695) | (2,695) | ||||
Foreign currency translation adjustments | (4,088) | (4,088) | ||||
Stock-based compensation (in shares) | 41 | |||||
Stock-based compensation | 1,220 | 1,220 | ||||
Shares withheld in lieu of employee tax withholding | (731) | (731) | ||||
Dividends paid | (2,992) | (2,992) | ||||
Balance (in shares) at Dec. 31, 2018 | 12,322 | (806) | ||||
Balance at Dec. 31, 2018 | 292,358 | $ 123 | 57,258 | 285,843 | $ (24,999) | (25,867) |
Balance (in shares) at Sep. 30, 2018 | 12,281 | (806) | ||||
Balance at Sep. 30, 2018 | 301,644 | $ 123 | 56,769 | 291,530 | $ (24,999) | (21,779) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 3,352 | |||||
Foreign currency translation adjustments | (1,416) | |||||
Balance (in shares) at Jun. 30, 2019 | 12,359 | (806) | ||||
Balance at Jun. 30, 2019 | 295,659 | $ 124 | 57,838 | 285,891 | $ (24,999) | (23,195) |
Balance (in shares) at Dec. 31, 2018 | 12,322 | (806) | ||||
Balance at Dec. 31, 2018 | 292,358 | $ 123 | 57,258 | 285,843 | $ (24,999) | (25,867) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 958 | 958 | ||||
Foreign currency translation adjustments | 1,720 | 1,720 | ||||
Stock-based compensation (in shares) | 17 | |||||
Stock-based compensation | 670 | $ 1 | 669 | |||
Shares withheld in lieu of employee tax withholding | (416) | (416) | ||||
Issuance of restricted stock (In shares) | 14 | |||||
Dividends paid | (2,996) | (2,996) | ||||
Balance (in shares) at Mar. 31, 2019 | 12,353 | (806) | ||||
Balance at Mar. 31, 2019 | 292,294 | $ 124 | 57,511 | 283,805 | $ (24,999) | (24,147) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 5,089 | 5,089 | ||||
Foreign currency translation adjustments | 952 | 952 | ||||
Stock-based compensation (in shares) | 6 | |||||
Stock-based compensation | 331 | $ 0 | 331 | |||
Shares withheld in lieu of employee tax withholding | (4) | (4) | ||||
Dividends paid | (3,003) | (3,003) | ||||
Balance (in shares) at Jun. 30, 2019 | 12,359 | (806) | ||||
Balance at Jun. 30, 2019 | $ 295,659 | $ 124 | $ 57,838 | $ 285,891 | $ (24,999) | $ (23,195) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Operating Activities: | ||
Net income (loss) | $ 3,352 | $ (8,691) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 9,408 | 9,655 |
Stock-based compensation | 2,220 | 2,485 |
Bad debt expense | 126 | 110 |
Deferred income tax benefit | (1,023) | (2,840) |
Gain on amended supply agreement | 0 | (507) |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (16,350) | (19,252) |
Contract assets and liabilities, net | 42,954 | (6,211) |
Inventories | (8,202) | (4,542) |
Income taxes | 6,439 | 945 |
Prepaid expenses and other current assets | (1,330) | 924 |
Accounts payable | (2,174) | 1,288 |
Accrued liabilities | (3,051) | 355 |
Other, net | 1,566 | 224 |
Net cash provided by (used in) operating activities | 33,935 | (26,057) |
Investing Activities: | ||
Purchases of short-term investments | (5,869) | (20,712) |
Maturities of short-term investments | 13,088 | 31,444 |
Purchases of property, plant and equipment, net | (3,210) | (3,922) |
Net cash provided by investing activities | 4,009 | 6,810 |
Financing Activities: | ||
Payments on industrial development revenue bonds | (400) | (400) |
Shares withheld in lieu of employee tax withholding | (1,151) | (578) |
Dividends paid | (8,991) | (8,934) |
Net cash used in financing activities | (10,542) | (9,912) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 27,402 | (29,159) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (542) | (389) |
Cash, cash equivalents and restricted cash, beginning of period | 61,725 | 93,210 |
Cash, cash equivalents and restricted cash, end of period | $ 88,585 | $ 63,662 |
OVERVIEW AND SUMMARY OF SIGNIFI
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Overview Powell Industries, Inc. (we, us, our, Powell or the Company) was incorporated in the state of Delaware in 2004 as a successor to a Nevada company incorporated in 1968. The Nevada company was the successor to a company founded by William E. Powell in 1947, which merged into the Company in 1977. Our major subsidiaries, all of which are wholly owned, include: Powell Electrical Systems, Inc.; Powell (UK) Limited; Powell Canada Inc. and Powell Industries International, B.V. We develop, design, manufacture and service custom-engineered products and systems for the distribution, control and monitoring of electrical energy. Headquartered in Houston, Texas, we serve the oil and gas markets, including onshore and offshore oil and gas production, pipeline, refining and liquid natural gas terminals, as well as petrochemical, electric utility, light rail traction power and other heavy industrial markets. Basis of Presentation These unaudited condensed consolidated financial statements include the accounts of Powell and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. These unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X for interim financial information. Certain information and footnote disclosures, normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP), have been condensed or omitted pursuant to those rules and regulations. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary to fairly state the financial position, results of operations and cash flows with respect to the interim condensed consolidated financial statements have been included. The results of operations for the interim periods are not necessarily indicative of the results for the entire fiscal year. We believe that these financial statements contain all adjustments necessary so that they are not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto of Powell and its subsidiaries included in Powell’s Annual Report on Form 10-K for the year ended September 30, 2018 , which was filed with the Securities and Exchange Commission (SEC) on December 12, 2018 . References to Fiscal 2019 and Fiscal 2018 used throughout this report shall mean our fiscal years ended September 30, 2019 and 2018 , respectively. Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying footnotes. The most significant estimates used in our condensed consolidated financial statements affect revenue recognition and estimated cost recognition on our customer contracts, the allowance for doubtful accounts, provision for excess and obsolete inventory, warranty accruals and income taxes. The amounts recorded for warranties, legal, income taxes, impairment of long-lived assets (when applicable) and other contingent liabilities require judgments regarding the amount of expenses that will ultimately be incurred. We base our estimates on historical experience and on various other assumptions, as well as the specific circumstances surrounding these contingent liabilities, in evaluating the amount of liability that should be recorded. Additionally, the recognition of deferred tax assets requires estimates related to future income and other assumptions regarding timing and future profitability because the ultimate realization of net deferred tax assets is dependent on the generation of future taxable income during the periods in which temporary differences become deductible. Estimates routinely change as new events occur, additional information becomes available or operating environments change. Actual results may differ from our prior estimates. New Accounting Standards In May 2014, the Financial Accounting Standards Board (FASB) issued a new standard on revenue recognition that supersedes previously issued revenue recognition guidance. This standard provides a five-step approach to be applied to all contracts with customers and requires expanded disclosures about the nature, amount, timing and uncertainty of revenue (and the related cash flows) arising from customer contracts, significant judgments and changes in judgments used in applying the revenue model and the assets recognized from costs incurred to obtain or fulfill a contract. Effective October 1, 2018, we adopted this standard using the modified retrospective basis. After evaluating the impact of this new standard on contracts outstanding as of October 1, 2018, we determined that no adjustment to retained earnings was necessary. See Note D for further discussion of revenue. In February 2016, the FASB issued a new topic on leases which requires lessees to recognize lease assets and lease liabilities on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The new topic is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. This would be our fiscal year ending September 30, 2020. In Fiscal 2018, we acquired new lease software designed to assist with our compliance of this new topic. We are still evaluating the impact this new topic will have on our consolidated financial position and results of operations. In November 2016, the FASB issued a new topic on the statement of cash flows that changes the presentation of restricted cash and cash equivalents on the statement of cash flows. Restricted cash and restricted cash equivalents is to be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We adopted this topic in Fiscal 2019 and our Condensed Consolidated Cash Flow Statements for all periods reflect this presentation. In May 2017, the FASB issued a new topic on modification accounting with regards to stock based compensation. This new topic clarifies when a change to the terms or conditions of a share-based payment award should be accounted for as a modification. An entity should account for the effects of a modification unless the fair value, vesting conditions and classification, as an equity instrument or a liability instrument, of the modified award are the same before and after a change to the terms or conditions of the share-based payment award. We adopted this topic in Fiscal 2019 and it has not had a material impact on our consolidated financial position or results of operations. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE We compute basic earnings per share by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per common and potential common share includes the weighted average of additional shares associated with the incremental effect of dilutive restricted stock and restricted stock units, as prescribed by the FASB guidance on earnings per share. The following table reconciles basic and diluted weighted average shares used in the computation of earnings per share (in thousands, except per share data): Three months ended June 30, Nine months ended June 30, 2019 2018 2019 2018 Numerator: Net income (loss) $ 5,089 $ 301 $ 3,352 $ (8,691 ) Denominator: Weighted average basic shares 11,579 11,514 11,567 11,503 Dilutive effect of restricted stock units 24 73 22 — Weighted average diluted shares 11,603 11,587 11,589 11,503 Income (loss) per share: Basic $ 0.44 $ 0.03 $ 0.29 $ (0.76 ) Diluted $ 0.44 $ 0.03 $ 0.29 $ (0.76 ) For the nine months ended June 30, 2018 , we incurred a net loss and therefore all potential common shares were deemed to be anti-dilutive. |
DETAIL OF SELECTED BALANCE SHEE
DETAIL OF SELECTED BALANCE SHEET ACCOUNTS | 9 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DETAIL OF SELECTED BALANCE SHEET ACCOUNTS | DETAIL OF SELECTED BALANCE SHEET ACCOUNTS Allowance for Doubtful Accounts Activity in our allowance for doubtful accounts receivable consisted of the following (in thousands): Three months ended June 30, Nine months ended June 30, 2019 2018 2019 2018 Balance at beginning of period $ 214 $ 264 $ 157 $ 179 Bad debt expense 25 18 126 110 Uncollectible accounts written off, net of recoveries (31 ) (36 ) (74 ) (44 ) Change due to foreign currency translation (3 ) (7 ) (4 ) (6 ) Balance at end of period $ 205 $ 239 $ 205 $ 239 Inventories The components of inventories are summarized below (in thousands): June 30, 2019 September 30, 2018 Raw materials, parts and subassemblies, net $ 28,436 $ 20,272 Work-in-progress 1,048 1,080 Total inventories $ 29,484 $ 21,352 Accrued Product Warranty Activity in our product warranty accrual consisted of the following (in thousands): Three months ended June 30, Nine months ended June 30, 2019 2018 2019 2018 Balance at beginning of period $ 2,986 $ 2,241 $ 2,604 $ 3,174 Increase (decrease) in warranty expense 945 1,036 2,572 970 Deduction for warranty charges (754 ) (891 ) (1,992 ) (1,752 ) Change due to foreign currency translation 3 (23 ) (4 ) (29 ) Balance at end of period $ 3,180 $ 2,363 $ 3,180 $ 2,363 |
REVENUE
REVENUE | 9 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE On October 1, 2018, we adopted the new revenue recognition standard using the modified retrospective transition method. We applied the guidance to customer contracts which were not substantially complete at that time and we determined that no adjustment to retained earnings was necessary. Financial results for reporting periods after October 1, 2018 are reported under the new guidance; however financial results for prior periods were not adjusted and will continue to be presented in accordance with the previous guidance. Revenue Recognition The majority of our revenues are generated from the manufacturing of custom engineered products and systems under long-term fixed price contracts under which we agree to manufacture various products such as traditional and arc-resistant distribution switchgear and control gear, medium-voltage circuit breakers, monitoring and control communications systems, motor control centers and bus duct systems. These products may be sold separately as an engineered solution, but are typically integrated into custom-built enclosures which we also build. These enclosures are referred to as power control room substations (PCRs®), custom-engineered modules or electrical houses (E-Houses). Some contracts may also include the installation and the commissioning of these enclosures. Revenue from these contracts is generally recognized over time utilizing the cost to cost method to measure the extent of progress toward the completion of the performance obligation and the recognition of revenue over time. We believe that this method is the most accurate representation of our performance because it directly measures the value of the services transferred to the customer over time as we incur costs on our contracts. Contract costs include all direct materials, labor, and indirect costs related to contract performance which may include indirect labor, supplies, tools, repairs and depreciation costs. We also have contracts to provide value-added services such as field service inspection, installation, commissioning, modification and repair, as well as retrofit and retrofill components for existing systems. As a practical expedient, if the service contract terms give us the right to invoice the customer for an amount that corresponds directly with the value of our performance completed to date (i.e., a service contract in which we bill a fixed amount for each hour of service provided), then we recognize revenue over time in each reporting period corresponding to the amount with which we have the right to invoice. Our performance obligations are satisfied as the work progresses. Revenues from our custom-engineered products and value-added services transferred to customers over time accounted for approximately 93% of total revenues for both the three and nine months ended June 30, 2019 . We also have sales orders for spare parts and replacement circuit breakers for switchgear that are obsolete or that are no longer produced by the original manufacturer. Revenues from these sales orders are recognized at a point in time when we fulfill our performance obligation to the customer which is typically upon shipment. Revenue related to sales orders represents approximately 7% of total revenues for both the three and nine months ended June 30, 2019 . Additionally, some contracts may contain a cancellation clause that could limit the amount of revenue we are able to recognize over time. In these instances, revenue and costs associated with these contracts are deferred and recognized at a point in time when the performance obligation is fulfilled. Selling and administrative costs incurred in relation to obtaining a contract are typically expensed as incurred. We periodically utilize a third-party sales agent to obtain a contract and will pay a commission to that agent. We record the full commission liability to the third-party sales agents at the order date, with a corresponding deferred asset. As the project progresses, we record commission expense based on percentage of completion rates that correlate to the project and reduce the deferred asset. Once we have been paid by the customer, we pay the commission and the deferred liability is reduced. Performance Obligations A performance obligation is a promise in a contract or with a customer to transfer a distinct good or service. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue as the performance obligations are satisfied. To determine the proper revenue recognition for contracts, we evaluate whether a contract should be accounted for as more than one performance obligation or, less commonly, whether two or more contracts should be combined and accounted for as one performance obligation. This evaluation of performance obligations requires significant judgement. The majority of our contracts have a single performance obligation where multiple engineered products and services are combined into a single custom engineered solution. Our contracts generally include a standard assurance warranty that typically ends eighteen months after shipment. Occasionally, we provide service-type warranties that will extend the warranty period. These extended warranties qualify as a separate performance obligation. If we determine during the evaluation of the contract that there are multiple performance obligations, we allocate the transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct good or service in the contract. Remaining unsatisfied performance obligations, which we refer to as backlog, represent the estimated transaction price for goods and services for which we have a material right but work has not been performed. As of June 30, 2019 , we had backlog of $407.0 million , of which approximately $368.7 million is expected to be recognized within the next twelve months. Backlog may not be indicative of future operating results as orders may be cancelled or modified by our customers. Our backlog does not include service and maintenance-type contracts for which we have the right to invoice as services are performed. Contract Estimates Actual revenues and project costs may vary from previous estimates due to changes in a variety of factors. The cost estimation process is based upon the professional knowledge and experience of our engineers, project managers and financial professionals. Factors that are considered in estimating the work to be completed and ultimate contract recovery include the availability and productivity of labor, the nature and complexity of the work to be performed, the availability of materials, and the effect of any delays on our project performance. We periodically review our job performance, job conditions, estimated profitability and final contract settlements, including our estimate of total costs and make revisions to costs and income in the period in which the revisions are probable and reasonably estimable. Whenever revisions of estimated contract costs and contract values indicate that the contract costs will exceed estimated revenues, thus creating a loss, a provision for the total estimated loss is recorded in that period. For the nine months ended June 30, 2019 and 2018 , our operating results were positively impacted by $4.3 million and $2.9 million , respectively, as a result of changes in contract estimates related to projects in progress at the beginning of the respective period. These changes in estimates resulted primarily from favorable project execution and negotiations of variable consideration, discussed below, as well as other changes in facts and circumstances during these periods. Variable Consideration It is common for our long-term contracts to contain variable consideration that can either increase or decrease the transaction price. Due to the nature of our contracts, estimating total cost and revenue can be complex and subject to variability due to change orders, back charges, spare parts, early completion bonuses, customer allowances and liquidated damages. We estimate the amount of variable consideration based on the expected value method, which is the sum of probability-weighted amount, or the most likely amount method which uses various factors including experience with similar transactions and assessment of our anticipated performance. Variable consideration is included in the transaction price if legally enforceable and to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur once the uncertainty associated with the variable consideration is resolved. Contract Modifications Contracts may be modified for changes in contract specifications and requirements. We consider contract modifications to exist when the modification either creates new or changes the enforceable rights and obligations under the contract. Most of our contract modifications are for goods and services that are not distinct from the existing performance obligation. Contract modifications result in a cumulative catch up adjustment to revenue based on our measure of progress for the performance obligation. Contract Balances The timing of revenue recognition, billings and cash collections affects accounts receivable, costs and estimated earnings in excess of billings on uncompleted contracts (contract assets) and billings in excess of costs and estimated earnings on uncompleted contracts (contract liabilities) in our Condensed Consolidated Balance Sheet. Contract assets, previously referred to as costs and estimated earnings in excess of billings on uncompleted contracts, are recorded when revenues are recognized in excess of amounts billed for fixed-price contracts as determined by the billing milestone schedule. Contract assets are transferred to accounts receivables when billing milestones have been met or we have an unconditional right to payment. Contract liabilities, previously referred to as billings in excess of costs and estimated earnings on uncompleted contracts, typically represent advance payments from contractual billing milestones and billings in excess of revenue recognized. It is unusual to have advanced milestone payments with a term greater than one year, which could represent a financing component on the contract. Our contract assets and liabilities are reported in a net position on a contract-by-contract basis at the end of each reporting period and are generally classified as current. Contract assets and liabilities as of June 30, 2019 and September 30, 2018 are summarized below (in thousands): June 30, 2019 September 30, 2018 Contract assets $ 57,231 $ 82,545 Contract liabilities (60,868 ) (43,174 ) Net contract asset (liability) $ (3,637 ) $ 39,371 The decrease in net contract asset (liability) at June 30, 2019 from September 30, 2018 was primarily due to our progress towards completion on our projects and the timing of contract billing milestones and new orders. To determine the amount of revenue recognized during the period from contract liabilities, we first allocate revenue to the individual contract liability balance outstanding at the beginning of the period until the revenue exceeds that balance. During the three and nine months ended June 30, 2019 , we recognized revenue of approximately $2.2 million and $39.4 million , respectively, related to contract liabilities outstanding at September 30, 2018 . The timing of our invoice process is typically dependent on the completion of certain milestones and contract terms and subject to agreement by our customer. Payment is typically expected within 30 days of invoice. Any uncollected invoiced amounts for our performance obligations recognized over time, including contract retentions, are recorded as accounts receivable in the Condensed Consolidated Balance Sheets. Certain contracts contain retention provisions that become due upon completion of contractual requirements. As of June 30, 2019 and September 30, 2018 , accounts receivable included retention amounts of $4.7 million and $4.2 million , respectively. Of the retained amount at June 30, 2019 , $4.4 million is expected to be collected in the next twelve months. Disaggregation of Revenue The following tables present our disaggregated revenue by geographic destination and market sector for the three and nine months ended June 30, 2019 (in thousands): Three months ended June 30, 2019 Nine months ended June 30, 2019 United States $ 99,745 $ 292,049 Canada 20,206 45,015 Europe, Middle East and Africa 9,659 20,608 Asia/Pacific 4,682 9,155 Mexico, Central and South America 1,296 1,849 Total revenues by geographic destination $ 135,588 $ 368,676 Three months ended June 30, 2019 Nine months ended June 30, 2019 Oil and gas $ 62,356 $ 167,954 Petrochemical 21,086 63,387 Electric utility 26,425 66,066 Traction power 7,423 18,457 All others 18,298 52,812 Total revenues by market sector $ 135,588 $ 368,676 |
LONG-TERM DEBT
LONG-TERM DEBT | 9 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT Long-term debt consisted of the following (in thousands): June 30, 2019 September 30, 2018 Industrial development revenue bonds $ 1,200 $ 1,600 Less current portion (400 ) (400 ) Total long-term debt $ 800 $ 1,200 U.S. Revolver We have a $75.0 million revolving credit facility (U.S. Revolver) to provide working capital support and letters of credit which expires in June 2022. The amount available under the U.S. Revolver at June 30, 2019 was reduced by $11.8 million for our outstanding letters of credit. Currently, our U.S. Revolver can only be used for letters of credit until we meet certain financial ratios. There were no loans outstanding under the U.S. Revolver as of June 30, 2019 . Per the terms of the U.S. Revolver, we are required to maintain cash in a pledged collateral account until we satisfy the following two financial ratios for two consecutive fiscal quarters: a max leverage ratio and a fixed charge coverage ratio. The max leverage ratio requires that the ratio of our consolidated funded indebtedness to our consolidated earnings before interest, taxes and depreciation (EBITDA) for the last four consecutive quarters not exceed 2.75 to 1.00. The fixed charge coverage ratio requires that the ratio of consolidated EBITDA for the last four fiscal quarters, less income taxes, capital expenditures, dividends, principal debt payments and interest charges be at least 1.25 to 1.00. If we are not in compliance with the these two ratios, we are required to maintain a cash balance in a pledged cash collateral account equal to 102% of the outstanding amount of any loans and letter of credit obligations until we meet the aforementioned required ratios. As of June 30, 2019 , the balance in the cash collateral account was $16.7 million and is recorded as restricted cash in our Condensed Consolidated Balance Sheets. The portion of the cash collateral associated with the outstanding letters of credit that are due to expire beyond twelve months has been classified as non-current restricted cash on our condensed consolidated balance sheets. As of June 30, 2019 , there was $63.2 million available for the issuance of letters of credit under the U.S. Revolver, subject to the cash collateral requirements mentioned above. The interest rate for amounts outstanding under the U.S. Revolver is a floating rate based upon the higher of the Federal Funds Rate plus 0.5%, the bank’s prime rate, or the Eurocurrency rate plus 1.00%. Once the applicable rate is determined, a margin ranging up to 1.25% is added to the applicable rate. The U.S. Revolver is collateralized by a pledge of 100% of the voting capital stock of each of our domestic subsidiaries and 65% of the voting capital stock of each non-domestic subsidiary. The U.S. Revolver provides for customary events of default and carries cross-default provisions with other existing debt agreements. If an event of default (as defined in the U.S. Revolver) occurs and is continuing, on the terms and subject to the conditions set forth in the U.S. Revolver, amounts outstanding under the U.S. Revolver may be accelerated and may become immediately due and payable. It also contains financial covenants defining various financial measures and the levels of these measures with which we must comply, as well as a “material adverse change” clause. A “material adverse change” is defined as a material change in our operations, business, properties, liabilities or condition (financial or otherwise) or a material impairment of our ability to perform our obligations under our credit agreements. As of June 30, 2019 , we were in compliance with all of the financial covenants of the U.S. Revolver. Industrial Development Revenue Bonds We borrowed $8.0 million in October 2001 through a loan agreement funded with proceeds from tax-exempt industrial development revenue bonds (Bonds). These Bonds were issued by the Illinois Development Finance Authority and were used for the completion of our Northlake, Illinois facility. Pursuant to the Bond issuance, a reimbursement agreement between us and a major domestic bank required an issuance by the bank of an irrevocable direct-pay letter of credit (Bond LC), as collateral, to the Bonds’ trustee to guarantee payment of the Bonds’ principal and interest when due. The Bond LC is subject to both early termination and extension provisions customary to such agreements, as well as various covenants, for which we were in compliance at June 30, 2019 . While the Bonds mature in 2021, the reimbursement agreement requires annual redemptions of $0.4 million that commenced on October 25, 2002. A sinking fund is used for the redemption of the Bonds. The Bonds bear interest at a floating rate determined weekly by the Bonds’ remarketing agent, which was the underwriter for the Bonds and is an affiliate of the bank. This interest rate was 2.03% as of June 30, 2019 . |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Letters of Credit, Surety Bonds and Bank Guarantees Certain customers require us to post letters of credit or surety bonds which assure that we will perform under the terms of our contract. In the event of default, the counterparty may demand payment from the bank under a letter of credit or performance by the surety under a bond. To date, there have been no significant expenses related to either letters of credit or surety bonds for the periods reported. We were contingently liable for letters of credit of $11.8 million as of June 30, 2019 . We also had surety bonds totaling $152.9 million that were outstanding, with additional bonding capacity of $597.1 million available, at June 30, 2019 . Additionally, we have a $6.3 million facility agreement (Facility Agreement) between Powell (UK) Limited and a large international bank. This Facility Agreement provides Powell (UK) Limited the ability to enter into bank guarantees as well as forward exchange contracts and currency options. At June 30, 2019 , we had outstanding guarantees totaling $3.7 million under this Facility Agreement and amounts available under this Facility Agreement were $2.6 million . The Facility Agreement provides for financial covenants and customary events of default, and carries cross-default provisions with our U.S. Revolver. If an event of default (as defined in the Facility Agreement) occurs and is continuing, per the terms and subject to the conditions set forth therein, obligations outstanding under the Facility Agreement may be accelerated and declared immediately due and payable. As of June 30, 2019 , we were in compliance with all of the financial covenants of the Facility Agreement. Litigation We are involved in various legal proceedings, claims and other disputes arising from our commercial operations, projects, employees and other matters which, in general, are subject to uncertainties and in which the outcomes are not predictable. Although we can give no assurances about the resolution of pending claims, litigation or other disputes and the effect such outcomes may have on us, management believes that any ultimate liability resulting from the outcome of such proceedings, to the extent not otherwise provided or covered by insurance, will not have a material adverse effect on our consolidated financial position or results of operations or liquidity. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 9 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Refer to our Annual Report on Form 10-K for the fiscal year ended September 30, 2018 for a full description of our existing stock-based compensation plans. Restricted Stock Units We issue restricted stock units (RSUs) to certain officers and key employees of the Company. The fair value of the RSUs is based on the price of our common stock as reported on the NASDAQ Global Market on the grant dates. The typical annual grant vests over a three -year period from the date of issuance and is a blend of time-based and performance-based shares. The portion of the grant that is time-based typically vests over a three -year period on each anniversary of the grant date, based on continued employment. The performance-based shares vest based on the three -year earnings performance of the Company following the grant date. At June 30, 2019 , there were 159,216 RSUs outstanding. The RSUs do not have voting rights but do receive dividend equivalents upon vesting; additionally, the shares of common stock underlying the RSUs are not considered issued and outstanding until vested and common stock is issued. RSU activity (number of shares) for the nine months ended June 30, 2019 is summarized below: Number of Weighted Outstanding at September 30, 2018 190,500 $ 33.73 Granted 77,150 34.89 Vested (97,684 ) 32.36 Forfeited/canceled (10,750 ) 34.27 Outstanding at June 30, 2019 159,216 $ 34.45 During the nine months ended June 30, 2019 and 2018 , we recorded compensation expense of $1.8 million and $2.0 million , respectively, related to the RSUs. Restricted Stock Each non-employee director receives 2,000 restricted shares of the Company’s common stock annually. Fifty -percent of the restricted stock granted to each of our non-employee directors vests immediately, while the remaining fifty -percent vests on the anniversary of the grant date. Compensation expense is recognized immediately for the first fifty -percent of the restricted stock granted, while compensation expense for the remaining fifty -percent is recognized over the remaining vesting period based on the closing price per share on the grant date. In February 2019, 14,000 shares of restricted stock were issued to our non-employee directors under the 2014 Director Plan at a price of $34.02 per share. For each of the nine months ended June 30, 2019 and 2018 , we recorded compensation expense of $0.4 million , related to restricted stock. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS We measure certain financial assets and liabilities at fair value. Fair value is defined as an “exit price” which represents the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in valuing an asset or liability. The accounting guidance requires the use of valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. As a basis for considering such assumptions and inputs, a fair value hierarchy has been established which identifies and prioritizes three levels of inputs to be used in measuring fair value. The three levels of the fair value hierarchy are as follows: Level 1 — Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 — Inputs other than the quoted prices in active markets that are observable either directly or indirectly, including: quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities 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 data and require the reporting entity to develop its own assumptions. The following table summarizes the fair value of our assets and liabilities that were accounted for at fair value on a recurring basis as of June 30, 2019 (in thousands): Fair Value Measurements at June 30, 2019 Quoted Prices in Significant Other Significant Fair Value at Assets: Cash and cash equivalents $ 71,921 $ — $ — $ 71,921 Short-term investments 6,109 — — 6,109 Restricted cash 16,664 — — 16,664 Other assets — 6,821 — 6,821 Liabilities: Deferred compensation — 6,284 — 6,284 The following table summarizes the fair value of our assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, 2018 (in thousands): Fair Value Measurements at September 30, 2018 Quoted Prices in Significant Other Significant Fair Value at Assets: Cash and cash equivalents $ 36,584 $ — $ — $ 36,584 Short-term investments 13,170 — — 13,170 Restricted cash 25,141 — — 25,141 Other assets — 6,817 — 6,817 Liabilities: Deferred compensation — 5,644 — 5,644 Fair value guidance requires certain fair value disclosures be presented in both interim and annual reports. The estimated fair value amounts of financial instruments have been determined using available market information and valuation methodologies described below. Cash and cash equivalents – Cash and cash equivalents, primarily funds held in money market savings instruments, are reported at their current carrying value which approximates fair value due to the short-term nature of these instruments and are included in cash and cash equivalents in our Condensed Consolidated Balance Sheets. Short-term Investments – Short-term investments include time deposits with original maturities of three months or more. Restricted Cash – Restricted cash represents a pledged cash collateral balance which is required under our amended credit agreement and is held in an interest-bearing account. See Note E for further discussion on restricted cash. Other Assets/Deferred Compensation – We hold investments in an irrevocable Rabbi Trust for our deferred compensation plan. The assets include both mutual fund investments and company-owned life insurance policies and are included in other assets in the accompanying Condensed Consolidated Balance sheets. Because the mutual funds and company-owned life insurance policies are combined in the plan, they are categorized as Level 2 in the fair value measurement hierarchy. The deferred compensation liability represents the investment options that the plan participants have designated to serve as the basis for measurement of the notional value of their accounts. Because the deferred compensation liability is intended to offset the plan assets, it is also categorized as Level 2 in the fair value measurement hierarchy. There were no transfers between levels within the fair value measurement hierarchy during the quarter ended June 30, 2019 . |
RESTRUCTURING AND OTHER
RESTRUCTURING AND OTHER | 9 Months Ended |
Jun. 30, 2019 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING AND OTHER | RESTRUCTURING AND OTHER In the nine months ended June 30, 2019 , we recorded lease accrual adjustments of $0.7 million related to certain facility leases in Canada that are no longer utilized in our operations. We also recorded a recovery of $0.5 million in the nine months ended June 30, 2019 as a result of the favorable settlement of a claim related to the divestiture of a subsidiary in Fiscal 2014. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The calculation of the effective tax rate is as follows (in thousands): Three months ended June 30, Nine months ended June 30, 2019 2018 2019 2018 Income (loss) before income taxes $ 5,886 $ 689 $ 4,315 $ (11,134 ) Income tax expense (benefit) 797 388 963 (2,443 ) Net income (loss) $ 5,089 $ 301 $ 3,352 $ (8,691 ) Effective tax rate 14 % 56 % 22 % 22 % On December 22, 2017, the new tax law lowered the corporate tax rate from 35% to 21% effective January 1, 2018. As a result, the U.S. federal statutory rate for Fiscal 2019 is 21%, compared to the blended statutory rate of 24.5% effective for Fiscal 2018. The effective tax rate of 14% for the third quarter of Fiscal 2019 was positively impacted by the relative amounts of income recognized in various foreign jurisdictions that were reserved with a valuation allowance. Conversely, losses recognized in foreign jurisdictions reserved with a valuation allowance negatively impacted the effective tax rate of 56% in the third quarter of Fiscal 2018 . For the nine months ended June 30, 2019 , the effective tax rate of 22% approximated the U.S. federal statutory rate as the immaterial losses incurred by foreign operations that were reserved with a valuation allowance had a minimal impact on the effective tax rate. The effective tax rate of 22% for the nine months ended June 30, 2018 was negatively impacted by foreign tax losses reserved with a valuation allowance, as well as $0.7 million of tax expense related to the re-measurement of U.S. deferred tax assets as a result of tax reform. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS On August 6, 2019, our Board of Directors declared a quarterly cash dividend on our common stock in the amount of $0.26 per share. The dividend is payable on September 18, 2019 to shareholders of record at the close of business on August 21, 2019. |
OVERVIEW AND SUMMARY OF SIGNI_2
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation These unaudited condensed consolidated financial statements include the accounts of Powell and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. These unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X for interim financial information. Certain information and footnote disclosures, normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP), have been condensed or omitted pursuant to those rules and regulations. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary to fairly state the financial position, results of operations and cash flows with respect to the interim condensed consolidated financial statements have been included. The results of operations for the interim periods are not necessarily indicative of the results for the entire fiscal year. We believe that these financial statements contain all adjustments necessary so that they are not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto of Powell and its subsidiaries included in Powell’s Annual Report on Form 10-K for the year ended September 30, 2018 , which was filed with the Securities and Exchange Commission (SEC) on December 12, 2018 . References to Fiscal 2019 and Fiscal 2018 used throughout this report shall mean our fiscal years ended September 30, 2019 and 2018 , respectively. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying footnotes. The most significant estimates used in our condensed consolidated financial statements affect revenue recognition and estimated cost recognition on our customer contracts, the allowance for doubtful accounts, provision for excess and obsolete inventory, warranty accruals and income taxes. The amounts recorded for warranties, legal, income taxes, impairment of long-lived assets (when applicable) and other contingent liabilities require judgments regarding the amount of expenses that will ultimately be incurred. We base our estimates on historical experience and on various other assumptions, as well as the specific circumstances surrounding these contingent liabilities, in evaluating the amount of liability that should be recorded. Additionally, the recognition of deferred tax assets requires estimates related to future income and other assumptions regarding timing and future profitability because the ultimate realization of net deferred tax assets is dependent on the generation of future taxable income during the periods in which temporary differences become deductible. Estimates routinely change as new events occur, additional information becomes available or operating environments change. Actual results may differ from our prior estimates. |
New Accounting Standards | New Accounting Standards In May 2014, the Financial Accounting Standards Board (FASB) issued a new standard on revenue recognition that supersedes previously issued revenue recognition guidance. This standard provides a five-step approach to be applied to all contracts with customers and requires expanded disclosures about the nature, amount, timing and uncertainty of revenue (and the related cash flows) arising from customer contracts, significant judgments and changes in judgments used in applying the revenue model and the assets recognized from costs incurred to obtain or fulfill a contract. Effective October 1, 2018, we adopted this standard using the modified retrospective basis. After evaluating the impact of this new standard on contracts outstanding as of October 1, 2018, we determined that no adjustment to retained earnings was necessary. See Note D for further discussion of revenue. In February 2016, the FASB issued a new topic on leases which requires lessees to recognize lease assets and lease liabilities on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The new topic is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. This would be our fiscal year ending September 30, 2020. In Fiscal 2018, we acquired new lease software designed to assist with our compliance of this new topic. We are still evaluating the impact this new topic will have on our consolidated financial position and results of operations. In November 2016, the FASB issued a new topic on the statement of cash flows that changes the presentation of restricted cash and cash equivalents on the statement of cash flows. Restricted cash and restricted cash equivalents is to be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We adopted this topic in Fiscal 2019 and our Condensed Consolidated Cash Flow Statements for all periods reflect this presentation. In May 2017, the FASB issued a new topic on modification accounting with regards to stock based compensation. This new topic clarifies when a change to the terms or conditions of a share-based payment award should be accounted for as a modification. An entity should account for the effects of a modification unless the fair value, vesting conditions and classification, as an equity instrument or a liability instrument, of the modified award are the same before and after a change to the terms or conditions of the share-based payment award. We adopted this topic in Fiscal 2019 and it has not had a material impact on our consolidated financial position or results of operations. |
Revenue Recognition | Performance Obligations A performance obligation is a promise in a contract or with a customer to transfer a distinct good or service. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue as the performance obligations are satisfied. To determine the proper revenue recognition for contracts, we evaluate whether a contract should be accounted for as more than one performance obligation or, less commonly, whether two or more contracts should be combined and accounted for as one performance obligation. This evaluation of performance obligations requires significant judgement. The majority of our contracts have a single performance obligation where multiple engineered products and services are combined into a single custom engineered solution. Our contracts generally include a standard assurance warranty that typically ends eighteen months after shipment. Occasionally, we provide service-type warranties that will extend the warranty period. These extended warranties qualify as a separate performance obligation. If we determine during the evaluation of the contract that there are multiple performance obligations, we allocate the transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct good or service in the contract. Remaining unsatisfied performance obligations, which we refer to as backlog, represent the estimated transaction price for goods and services for which we have a material right but work has not been performed. Variable Consideration It is common for our long-term contracts to contain variable consideration that can either increase or decrease the transaction price. Due to the nature of our contracts, estimating total cost and revenue can be complex and subject to variability due to change orders, back charges, spare parts, early completion bonuses, customer allowances and liquidated damages. We estimate the amount of variable consideration based on the expected value method, which is the sum of probability-weighted amount, or the most likely amount method which uses various factors including experience with similar transactions and assessment of our anticipated performance. Variable consideration is included in the transaction price if legally enforceable and to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur once the uncertainty associated with the variable consideration is resolved. Contract Modifications Contracts may be modified for changes in contract specifications and requirements. We consider contract modifications to exist when the modification either creates new or changes the enforceable rights and obligations under the contract. Most of our contract modifications are for goods and services that are not distinct from the existing performance obligation. Contract modifications result in a cumulative catch up adjustment to revenue based on our measure of progress for the performance obligation. Contract Balances The timing of revenue recognition, billings and cash collections affects accounts receivable, costs and estimated earnings in excess of billings on uncompleted contracts (contract assets) and billings in excess of costs and estimated earnings on uncompleted contracts (contract liabilities) in our Condensed Consolidated Balance Sheet. Contract assets, previously referred to as costs and estimated earnings in excess of billings on uncompleted contracts, are recorded when revenues are recognized in excess of amounts billed for fixed-price contracts as determined by the billing milestone schedule. Contract assets are transferred to accounts receivables when billing milestones have been met or we have an unconditional right to payment. Contract liabilities, previously referred to as billings in excess of costs and estimated earnings on uncompleted contracts, typically represent advance payments from contractual billing milestones and billings in excess of revenue recognized. It is unusual to have advanced milestone payments with a term greater than one year, which could represent a financing component on the contract. Our contract assets and liabilities are reported in a net position on a contract-by-contract basis at the end of each reporting period and are generally classified as current. On October 1, 2018, we adopted the new revenue recognition standard using the modified retrospective transition method. We applied the guidance to customer contracts which were not substantially complete at that time and we determined that no adjustment to retained earnings was necessary. Financial results for reporting periods after October 1, 2018 are reported under the new guidance; however financial results for prior periods were not adjusted and will continue to be presented in accordance with the previous guidance. Revenue Recognition The majority of our revenues are generated from the manufacturing of custom engineered products and systems under long-term fixed price contracts under which we agree to manufacture various products such as traditional and arc-resistant distribution switchgear and control gear, medium-voltage circuit breakers, monitoring and control communications systems, motor control centers and bus duct systems. These products may be sold separately as an engineered solution, but are typically integrated into custom-built enclosures which we also build. These enclosures are referred to as power control room substations (PCRs®), custom-engineered modules or electrical houses (E-Houses). Some contracts may also include the installation and the commissioning of these enclosures. Revenue from these contracts is generally recognized over time utilizing the cost to cost method to measure the extent of progress toward the completion of the performance obligation and the recognition of revenue over time. We believe that this method is the most accurate representation of our performance because it directly measures the value of the services transferred to the customer over time as we incur costs on our contracts. Contract costs include all direct materials, labor, and indirect costs related to contract performance which may include indirect labor, supplies, tools, repairs and depreciation costs. We also have contracts to provide value-added services such as field service inspection, installation, commissioning, modification and repair, as well as retrofit and retrofill components for existing systems. As a practical expedient, if the service contract terms give us the right to invoice the customer for an amount that corresponds directly with the value of our performance completed to date (i.e., a service contract in which we bill a fixed amount for each hour of service provided), then we recognize revenue over time in each reporting period corresponding to the amount with which we have the right to invoice. Our performance obligations are satisfied as the work progresses. Revenues from our custom-engineered products and value-added services transferred to customers over time accounted for approximately 93% of total revenues for both the three and nine months ended June 30, 2019 . We also have sales orders for spare parts and replacement circuit breakers for switchgear that are obsolete or that are no longer produced by the original manufacturer. Revenues from these sales orders are recognized at a point in time when we fulfill our performance obligation to the customer which is typically upon shipment. Revenue related to sales orders represents approximately 7% of total revenues for both the three and nine months ended June 30, 2019 . Additionally, some contracts may contain a cancellation clause that could limit the amount of revenue we are able to recognize over time. In these instances, revenue and costs associated with these contracts are deferred and recognized at a point in time when the performance obligation is fulfilled. Selling and administrative costs incurred in relation to obtaining a contract are typically expensed as incurred. We periodically utilize a third-party sales agent to obtain a contract and will pay a commission to that agent. We record the full commission liability to the third-party sales agents at the order date, with a corresponding deferred asset. As the project progresses, we record commission expense based on percentage of completion rates that correlate to the project and reduce the deferred asset. Once we have been paid by the customer, we pay the commission and the deferred liability is reduced Contract Estimates Actual revenues and project costs may vary from previous estimates due to changes in a variety of factors. The cost estimation process is based upon the professional knowledge and experience of our engineers, project managers and financial professionals. Factors that are considered in estimating the work to be completed and ultimate contract recovery include the availability and productivity of labor, the nature and complexity of the work to be performed, the availability of materials, and the effect of any delays on our project performance. We periodically review our job performance, job conditions, estimated profitability and final contract settlements, including our estimate of total costs and make revisions to costs and income in the period in which the revisions are probable and reasonably estimable. Whenever revisions of estimated contract costs and contract values indicate that the contract costs will exceed estimated revenues, thus creating a loss, a provision for the total estimated loss is recorded in that period. The timing of our invoice process is typically dependent on the completion of certain milestones and contract terms and subject to agreement by our customer. Payment is typically expected within 30 days of invoice. Any uncollected invoiced amounts for our performance obligations recognized over time, including contract retentions, are recorded as accounts receivable in the Condensed Consolidated Balance Sheets. Certain contracts contain retention provisions that become due upon completion of contractual requirements. |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Reconciliation of Basic and Diluted Weighted Average Shares used in Computation of Earnings Per Share | The following table reconciles basic and diluted weighted average shares used in the computation of earnings per share (in thousands, except per share data): Three months ended June 30, Nine months ended June 30, 2019 2018 2019 2018 Numerator: Net income (loss) $ 5,089 $ 301 $ 3,352 $ (8,691 ) Denominator: Weighted average basic shares 11,579 11,514 11,567 11,503 Dilutive effect of restricted stock units 24 73 22 — Weighted average diluted shares 11,603 11,587 11,589 11,503 Income (loss) per share: Basic $ 0.44 $ 0.03 $ 0.29 $ (0.76 ) Diluted $ 0.44 $ 0.03 $ 0.29 $ (0.76 ) |
DETAIL OF SELECTED BALANCE SH_2
DETAIL OF SELECTED BALANCE SHEET ACCOUNTS (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Activity in Allowance for Doubtful Accounts Receivable | Activity in our allowance for doubtful accounts receivable consisted of the following (in thousands): Three months ended June 30, Nine months ended June 30, 2019 2018 2019 2018 Balance at beginning of period $ 214 $ 264 $ 157 $ 179 Bad debt expense 25 18 126 110 Uncollectible accounts written off, net of recoveries (31 ) (36 ) (74 ) (44 ) Change due to foreign currency translation (3 ) (7 ) (4 ) (6 ) Balance at end of period $ 205 $ 239 $ 205 $ 239 |
Components of Inventories | The components of inventories are summarized below (in thousands): June 30, 2019 September 30, 2018 Raw materials, parts and subassemblies, net $ 28,436 $ 20,272 Work-in-progress 1,048 1,080 Total inventories $ 29,484 $ 21,352 |
Activity in Product Warranty Accrual | Activity in our product warranty accrual consisted of the following (in thousands): Three months ended June 30, Nine months ended June 30, 2019 2018 2019 2018 Balance at beginning of period $ 2,986 $ 2,241 $ 2,604 $ 3,174 Increase (decrease) in warranty expense 945 1,036 2,572 970 Deduction for warranty charges (754 ) (891 ) (1,992 ) (1,752 ) Change due to foreign currency translation 3 (23 ) (4 ) (29 ) Balance at end of period $ 3,180 $ 2,363 $ 3,180 $ 2,363 |
REVENUE (Tables)
REVENUE (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Contract Asset and Liabilities | Contract assets and liabilities as of June 30, 2019 and September 30, 2018 are summarized below (in thousands): June 30, 2019 September 30, 2018 Contract assets $ 57,231 $ 82,545 Contract liabilities (60,868 ) (43,174 ) Net contract asset (liability) $ (3,637 ) $ 39,371 |
Disaggregation of Revenue | The following tables present our disaggregated revenue by geographic destination and market sector for the three and nine months ended June 30, 2019 (in thousands): Three months ended June 30, 2019 Nine months ended June 30, 2019 United States $ 99,745 $ 292,049 Canada 20,206 45,015 Europe, Middle East and Africa 9,659 20,608 Asia/Pacific 4,682 9,155 Mexico, Central and South America 1,296 1,849 Total revenues by geographic destination $ 135,588 $ 368,676 Three months ended June 30, 2019 Nine months ended June 30, 2019 Oil and gas $ 62,356 $ 167,954 Petrochemical 21,086 63,387 Electric utility 26,425 66,066 Traction power 7,423 18,457 All others 18,298 52,812 Total revenues by market sector $ 135,588 $ 368,676 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Components of Long-term debt | Long-term debt consisted of the following (in thousands): June 30, 2019 September 30, 2018 Industrial development revenue bonds $ 1,200 $ 1,600 Less current portion (400 ) (400 ) Total long-term debt $ 800 $ 1,200 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Restricted Stock Units Activity | RSU activity (number of shares) for the nine months ended June 30, 2019 is summarized below: Number of Weighted Outstanding at September 30, 2018 190,500 $ 33.73 Granted 77,150 34.89 Vested (97,684 ) 32.36 Forfeited/canceled (10,750 ) 34.27 Outstanding at June 30, 2019 159,216 $ 34.45 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Assets and Liabilities Measured on Recurring Basis | The following table summarizes the fair value of our assets and liabilities that were accounted for at fair value on a recurring basis as of June 30, 2019 (in thousands): Fair Value Measurements at June 30, 2019 Quoted Prices in Significant Other Significant Fair Value at Assets: Cash and cash equivalents $ 71,921 $ — $ — $ 71,921 Short-term investments 6,109 — — 6,109 Restricted cash 16,664 — — 16,664 Other assets — 6,821 — 6,821 Liabilities: Deferred compensation — 6,284 — 6,284 The following table summarizes the fair value of our assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, 2018 (in thousands): Fair Value Measurements at September 30, 2018 Quoted Prices in Significant Other Significant Fair Value at Assets: Cash and cash equivalents $ 36,584 $ — $ — $ 36,584 Short-term investments 13,170 — — 13,170 Restricted cash 25,141 — — 25,141 Other assets — 6,817 — 6,817 Liabilities: Deferred compensation — 5,644 — 5,644 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Calculation of the Effective Income Tax Rate | The calculation of the effective tax rate is as follows (in thousands): Three months ended June 30, Nine months ended June 30, 2019 2018 2019 2018 Income (loss) before income taxes $ 5,886 $ 689 $ 4,315 $ (11,134 ) Income tax expense (benefit) 797 388 963 (2,443 ) Net income (loss) $ 5,089 $ 301 $ 3,352 $ (8,691 ) Effective tax rate 14 % 56 % 22 % 22 % |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | |
Numerator: | ||||||||
Net income (loss) | $ 5,089 | $ 958 | $ (2,695) | $ 301 | $ (3,330) | $ (5,662) | $ 3,352 | $ (8,691) |
Denominator: | ||||||||
Weighted average basic shares (in shares) | 11,579 | 11,514 | 11,567 | 11,503 | ||||
Dilutive effect of restricted stock units (in shares) | 24 | 73 | 22 | 0 | ||||
Weighted average diluted shares | 11,603 | 11,587 | 11,589 | 11,503 | ||||
Income (loss) per share: | ||||||||
Basic (in dollars per share) | $ 0.44 | $ 0.03 | $ 0.29 | $ (0.76) | ||||
Diluted (in dollars per share) | $ 0.44 | $ 0.03 | $ 0.29 | $ (0.76) |
DETAIL OF SELECTED BALANCE SH_3
DETAIL OF SELECTED BALANCE SHEET ACCOUNTS - Activity in Allowance for Doubtful Accounts Receivable (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balance at beginning of period | $ 214 | $ 264 | $ 157 | $ 179 |
Bad debt expense | 25 | 18 | 126 | 110 |
Uncollectible accounts written off, net of recoveries | (31) | (36) | (74) | (44) |
Change due to foreign currency translation | (3) | (7) | (4) | (6) |
Balance at end of period | $ 205 | $ 239 | $ 205 | $ 239 |
DETAIL OF SELECTED BALANCE SH_4
DETAIL OF SELECTED BALANCE SHEET ACCOUNTS - Components of Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Raw materials, parts and subassemblies, net | $ 28,436 | $ 20,272 |
Work-in-progress | 1,048 | 1,080 |
Total inventories | $ 29,484 | $ 21,352 |
DETAIL OF SELECTED BALANCE SH_5
DETAIL OF SELECTED BALANCE SHEET ACCOUNTS - Activity in Product Warranty Accrual (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||||
Balance at beginning of period | $ 2,986 | $ 2,241 | $ 2,604 | $ 3,174 |
Increase (decrease) in warranty expense | 945 | 1,036 | 2,572 | 970 |
Deduction for warranty charges | (754) | (891) | (1,992) | (1,752) |
Change due to foreign currency translation | 3 | (23) | (4) | (29) |
Balance at end of period | $ 3,180 | $ 2,363 | $ 3,180 | $ 2,363 |
REVENUE (Details)
REVENUE (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |||
Revenue from products and services transferred to customers over time, percent | 93.00% | 93.00% | |
Revenue from sales orders, percentage | 7.00% | 7.00% | |
Changes in contract estimates related to projects in progress | $ 4.3 | $ 2.9 |
REVENUE - Performance Obligatio
REVENUE - Performance Obligations (Details) $ in Millions | Jun. 30, 2019USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation, amount | $ 407 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-07-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation, amount | $ 368.7 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, expected timing of satisfaction, period | 1 year |
REVENUE - Contract Balances (De
REVENUE - Contract Balances (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |||
Contract assets | $ 57,231 | $ 82,545 | |
Contract liabilities | (60,868) | (43,174) | |
Net contract asset (liability) | (3,637) | 39,371 | |
Revenue recognized related to contract liabilities | 2,200 | $ 39,400 | |
Retention amounts included in accounts receivable | 4,700 | $ 4,200 | |
Retained amount expected to be collected in the next twelve months | $ 4,400 |
REVENUE - Disaggregation of Rev
REVENUE - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 135,588 | $ 122,130 | $ 368,676 | $ 313,819 |
Oil and gas | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 62,356 | 167,954 | ||
Petrochemical | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 21,086 | 63,387 | ||
Electric utility | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 26,425 | 66,066 | ||
Traction power | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 7,423 | 18,457 | ||
All others | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 18,298 | 52,812 | ||
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 99,745 | 292,049 | ||
Canada | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 20,206 | 45,015 | ||
Europe, Middle East and Africa | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 9,659 | 20,608 | ||
Asia/Pacific | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 4,682 | 9,155 | ||
Mexico, Central and South America | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 1,296 | $ 1,849 |
LONG-TERM DEBT - Components of
LONG-TERM DEBT - Components of Long-Term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Debt Disclosure [Abstract] | ||
Industrial development revenue bonds | $ 1,200 | $ 1,600 |
Less current portion | (400) | (400) |
Total long-term debt | $ 800 | $ 1,200 |
LONG-TERM DEBT - Narrative (Det
LONG-TERM DEBT - Narrative (Details) - USD ($) | 9 Months Ended | |
Jun. 30, 2019 | Oct. 31, 2001 | |
U.S. Revolver | ||
Line Of Credit Facility [Line Items] | ||
Revolving credit facility | $ 75,000,000 | |
Revolving credit facility borrowings, outstanding amount | $ 0 | |
Ratio of indebtedness to consolidated earnings before interest, taxes, depreciation and amortization | 2.75 | |
Ratio of consolidated earnings before interest, taxes, depreciation and amortization, less income taxes, capital expenditures, principal debt payments and interest charges | 1.25 | |
Amount available under the credit facility | $ 63,200,000 | |
Percentage of voting capital stock pledged as collateral | 100.00% | |
Non-domestic subsidiaries of voting capital stock | 65.00% | |
U.S. Revolver | Maximum | ||
Line Of Credit Facility [Line Items] | ||
Basis spread on variable rate | 1.25% | |
U.S. Revolver | Federal Funds Rate | ||
Line Of Credit Facility [Line Items] | ||
Basis spread on variable rate | 0.50% | |
U.S. Revolver | Eurocurrency Rate | ||
Line Of Credit Facility [Line Items] | ||
Basis spread on variable rate | 1.00% | |
U.S. Revolver | The Third Amendment | ||
Line Of Credit Facility [Line Items] | ||
Cash collateral percent of outstanding debt (at least) | 102.00% | |
Cash collateral pledged balance | $ 16,700,000 | |
U.S. Revolver | Financial Standby Letter of Credit | ||
Line Of Credit Facility [Line Items] | ||
Guarantee liability | 11,800,000 | |
Industrial Development Revenue Bonds | ||
Line Of Credit Facility [Line Items] | ||
Borrowings | $ 8,000,000 | |
Reimbursement agreement requires annual redemptions | $ 400,000 | |
Interest rate | 2.03% |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | Jun. 30, 2019USD ($) |
Guarantee Obligations [Line Items] | |
Additional bonding capacity | $ 597,100,000 |
Facility Agreement | Powell (UK) Limited | |
Guarantee Obligations [Line Items] | |
Guarantee liability | 3,700,000 |
Revolving credit facility | 6,300,000 |
Amount of credit facility remaining borrowing capacity | 2,600,000 |
Surety Bonds | |
Guarantee Obligations [Line Items] | |
Guarantee liability | 152,900,000 |
U.S. Revolver | |
Guarantee Obligations [Line Items] | |
Revolving credit facility | 75,000,000 |
Amount of credit facility remaining borrowing capacity | 63,200,000 |
U.S. Revolver | Financial Standby Letter of Credit | |
Guarantee Obligations [Line Items] | |
Guarantee liability | $ 11,800,000 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 9 Months Ended | ||
Feb. 28, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Restricted Stock Units (RSUs) | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Unvested restricted stock outstanding (in shares) | 159,216 | 190,500 | ||
Compensation expense | $ 1.8 | $ 2 | ||
Restricted Stock Units (RSUs) | Time Based Restricted Stock Unit | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Restricted Stock Units (RSUs) | Performance Based Restricted Stock Unit | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Restricted Stock | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Compensation expense | $ 0.4 | $ 0.4 | ||
Restricted Stock | Immediate Vesting | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting, percentage | 50.00% | |||
Restricted Stock | Anniversary of Grant Date | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting, percentage | 50.00% | |||
Restricted Stock | Non Employee Director Equity Incentive Plan | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Shares issued under the plan (in shares) | 2,000 | |||
Restricted stock issued (in shares) | 14,000 | |||
Shares issued, price per share (in usd per share) | $ 34.02 |
STOCK-BASED COMPENSATION - Sche
STOCK-BASED COMPENSATION - Schedule of Restricted Stock Units Activity (Details) | 9 Months Ended |
Jun. 30, 2019$ / sharesshares | |
Number of Restricted Stock Units | |
Forfeited/canceled (in shares) | shares | (10,750) |
Weighted Average Fair Value Per Share | |
Forfeited/canceled (in dollars per share) | $ / shares | $ 34.27 |
Restricted Stock Units (RSUs) | |
Number of Restricted Stock Units | |
Outstanding at beginning of period (in shares) | shares | 190,500 |
Granted (in shares) | shares | 77,150 |
Vested (in shares) | shares | (97,684) |
Outstanding at end of period (in shares) | shares | 159,216 |
Weighted Average Fair Value Per Share | |
Outstanding at beginning of period (in dollars per share) | $ / shares | $ 33.73 |
Granted (in dollars per share) | $ / shares | 34.89 |
Vested (in dollars per share) | $ / shares | 32.36 |
Outstanding at end of period (in dollars per share) | $ / shares | $ 34.45 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Assets: | ||
Cash and cash equivalents | $ 71,921 | $ 36,584 |
Short-term investments | 6,109 | 13,170 |
Restricted cash | 16,664 | 25,141 |
Other assets | 6,821 | 6,817 |
Liabilities: | ||
Deferred compensation | 6,284 | 5,644 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Cash and cash equivalents | 71,921 | 36,584 |
Short-term investments | 6,109 | 13,170 |
Restricted cash | 16,664 | 25,141 |
Other assets | 0 | 0 |
Liabilities: | ||
Deferred compensation | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Cash and cash equivalents | 0 | 0 |
Short-term investments | 0 | 0 |
Restricted cash | 0 | 0 |
Other assets | 6,821 | 6,817 |
Liabilities: | ||
Deferred compensation | 6,284 | 5,644 |
Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Cash and cash equivalents | 0 | 0 |
Short-term investments | 0 | 0 |
Restricted cash | 0 | 0 |
Other assets | 0 | 0 |
Liabilities: | ||
Deferred compensation | $ 0 | $ 0 |
RESTRUCTURING AND OTHER (Detail
RESTRUCTURING AND OTHER (Details) $ in Millions | 9 Months Ended |
Jun. 30, 2019USD ($) | |
Restructuring and Related Activities [Abstract] | |
Lease accrual adjustments | $ 0.7 |
Recovery, as a result of a favorable settlement | $ 0.5 |
INCOME TAXES - Schedule of Calc
INCOME TAXES - Schedule of Calculation of the Effective Tax Rate (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||||||||
Income (loss) before income taxes | $ 5,886 | $ 689 | $ 4,315 | $ (11,134) | ||||
Income tax expense (benefit) | 797 | 388 | 963 | (2,443) | ||||
Net income (loss) | $ 5,089 | $ 958 | $ (2,695) | $ 301 | $ (3,330) | $ (5,662) | $ 3,352 | $ (8,691) |
Effective tax rate | 14.00% | 56.00% | 22.00% | 22.00% |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |||||
Blended tax rate | 24.50% | ||||
Effective tax rate | 14.00% | 56.00% | 22.00% | 22.00% | |
Re-measurement of deferred tax assets | $ 0.7 | $ 0.7 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - $ / shares | Aug. 06, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Subsequent Event [Line Items] | |||||
Quarterly cash dividend (in dollars per share) | $ 0.26 | $ 0.26 | $ 0.78 | $ 0.78 | |
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Quarterly cash dividend (in dollars per share) | $ 0.26 |