Document and Entity Information
Document and Entity Information - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Feb. 18, 2022 | Jul. 03, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Jan. 1, 2022 | ||
Current Fiscal Year End Date | --01-01 | ||
Document Transition Report | false | ||
Entity File Number | 001-11406 | ||
Entity Registrant Name | KADANT INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 52-1762325 | ||
Entity Address, Address Line One | One Technology Park Drive | ||
Entity Address, City or Town | Westford | ||
Entity Address, State or Province | MA | ||
Entity Address, Postal Zip Code | 01886 | ||
City Area Code | 978 | ||
Local Phone Number | 776-2000 | ||
Title of 12(b) Security | Common Stock, $.01 par value | ||
Trading Symbol | KAI | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 2,020,422 | ||
Entity Common Stock, Shares Outstanding | 11,621,092 | ||
Documents Incorporated by Reference | Portions of the Registrant's definitive Proxy Statement pursuant to Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended, to be used in connection with the Registrant's 2022 Annual Meeting of Stockholders are incorporated by reference into Part III of this Form 10-K. | ||
Entity Central Index Key | 0000886346 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Jan. 01, 2022 | |
Audit Information [Abstract] | |
Auditor Name | KPMG LLP |
Auditor Location | Boston, Massachusetts |
Auditor Firm ID | 185 |
Consolidated Balance Sheet
Consolidated Balance Sheet - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Current Assets: | ||
Cash and cash equivalents | $ 91,186 | $ 65,682 |
Restricted cash | 2,975 | 958 |
Accounts receivable, net of allowances of $2,735 and $2,977 | 117,209 | 91,540 |
Inventories | 134,356 | 106,814 |
Contract assets | 8,626 | 7,576 |
Other current assets | 29,530 | 17,250 |
Total Current Assets | 383,882 | 289,820 |
Property, Plant, and Equipment, Net | 107,989 | 84,642 |
Other Assets | 44,111 | 40,391 |
Intangible Assets, Net (Notes 1 and 2) | 199,343 | 160,965 |
Goodwill (Notes 1 and 2) | 396,887 | 351,753 |
Total Assets | 1,132,212 | 927,571 |
Current Liabilities: | ||
Short-term obligations and current maturities of long-term obligations (Note 6) | 5,356 | 1,474 |
Accounts payable | 59,250 | 32,264 |
Accrued payroll and employee benefits | 37,203 | 31,168 |
Customer deposits | 59,262 | 29,433 |
Advanced billings | 11,894 | 8,513 |
Other current liabilities | 48,532 | 31,836 |
Total Current Liabilities | 221,497 | 134,688 |
Long-Term Obligations (Note 6) | 264,158 | 232,000 |
Long-Term Deferred Income Taxes (Note 5) | 34,944 | 21,669 |
Other Long-Term Liabilities | 45,997 | 42,309 |
Commitments and Contingencies (Note 7) | ||
Stockholders' Equity (Notes 3 and 4): | ||
Preferred stock, $.01 par value, 5,000,000 shares authorized; none issued | 0 | 0 |
Common stock, $.01 par value, 150,000,000 shares authorized; 14,624,159 shares issued | 146 | 146 |
Capital in excess of par value | 115,888 | 110,824 |
Retained earnings | 551,848 | 479,400 |
Treasury stock at cost, 3,003,419 and 3,081,919 shares | (73,596) | (75,519) |
Accumulated other comprehensive items (Note 14) | (30,350) | (19,492) |
Total Kadant Stockholders' Equity | 563,936 | 495,359 |
Noncontrolling interest | 1,680 | 1,546 |
Total Stockholders' Equity | 565,616 | 496,905 |
Total Liabilities and Stockholders' Equity | $ 1,132,212 | $ 927,571 |
Consolidated Balance Sheet (Par
Consolidated Balance Sheet (Parenthetical) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowances | $ 2,735 | $ 2,977 |
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 150,000,000 | 150,000,000 |
Common stock, issued (in shares) | 14,624,159 | 14,624,159 |
Treasury stock (in shares) | 3,003,419 | 3,081,919 |
Consolidated Statement of Incom
Consolidated Statement of Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Income Statement [Abstract] | |||
Revenue (Notes 1 and 12) | $ 786,579 | $ 635,028 | $ 704,644 |
Costs and Operating Expenses: | |||
Cost of revenue | 449,214 | 357,722 | 410,884 |
Selling, general, and administrative expenses | 208,787 | 181,905 | 192,525 |
Research and development expenses | 11,403 | 11,298 | 10,884 |
Impairments and other costs, net (Notes 1 and 8) | 465 | 2,979 | 2,528 |
Total Costs and Operating Expenses | 669,869 | 553,904 | 616,821 |
Operating Income | 116,710 | 81,124 | 87,823 |
Interest Income | 267 | 181 | 213 |
Interest Expense | (4,821) | (7,423) | (12,755) |
Other Expense, Net (Note 3) | (104) | (195) | (6,359) |
Income Before Provision for Income Taxes | 112,052 | 73,687 | 68,922 |
Provision for Income Taxes (Note 5) | 27,171 | 17,948 | 16,358 |
Net Income | 84,881 | 55,739 | 52,564 |
Net Income Attributable to Noncontrolling Interest | (838) | (543) | (496) |
Net income attributable to Kadant | $ 84,043 | $ 55,196 | $ 52,068 |
Earnings per Share Attributable to Kadant (Note 13) | |||
Basic (in dollars per share) | $ 7.26 | $ 4.81 | $ 4.63 |
Diluted (in dollars per share) | $ 7.21 | $ 4.77 | $ 4.54 |
Weighted Average Shares (Note 13) | |||
Basic (in shares) | 11,579 | 11,482 | 11,235 |
Diluted (in shares) | 11,655 | 11,564 | 11,457 |
Consolidated Statement of Compr
Consolidated Statement of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 84,881 | $ 55,739 | $ 52,564 |
Other Comprehensive Items: | |||
Foreign currency translation adjustment | (11,324) | 18,395 | (1,392) |
Pension and other post-retirement liability adjustments, net (net of tax of $(1), $78, and $(137)) | (22) | 180 | (282) |
Effect of pension plan settlement (net of tax of $0, $0, and $(653)) | 0 | (119) | 3,826 |
Deferred gain (loss) on cash flow hedges (net of tax of $118, $(57), and $(143)) | 366 | (184) | (447) |
Other Comprehensive Items | (10,980) | 18,272 | 1,705 |
Comprehensive Income | 73,901 | 74,011 | 54,269 |
Comprehensive Income Attributable to Noncontrolling Interest | (716) | (687) | (445) |
Comprehensive Income Attributable to Kadant | $ 73,185 | $ 73,324 | $ 53,824 |
Consolidated Statement of Com_2
Consolidated Statement of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Other Comprehensive Items: | |||
Pension and other post-retirement liability adjustments, net | $ (1) | $ 78 | $ (137) |
Effect of pension plan settlement | 0 | 0 | (653) |
Deferred gain (loss) on cash flow hedges | $ 118 | $ (57) | $ (143) |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Operating Activities | |||
Net income attributable to Kadant | $ 84,043 | $ 55,196 | $ 52,068 |
Net income attributable to noncontrolling interest | 838 | 543 | 496 |
Net income | 84,881 | 55,739 | 52,564 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 34,302 | 31,334 | 32,390 |
Stock-based compensation expense | 8,527 | 6,776 | 6,815 |
Provision for losses on accounts receivable | 5 | 356 | 114 |
Gain on sale of property, plant, and equipment | (375) | (8) | (79) |
U.S. pension benefit plan settlement loss | 0 | 0 | 5,887 |
Impairment charges (Notes 1 and 8) | 804 | 1,861 | 2,336 |
Deferred income tax (benefit) provision | (1,384) | 142 | (2,491) |
Other items, net | 6,333 | 4,720 | 5,390 |
Changes in assets and liabilities, net of effects of acquisitions: | |||
Accounts receivable | (16,737) | 7,116 | 6,553 |
Contract assets | (1,222) | 6,073 | 2,559 |
Inventories | (11,173) | (89) | (3,076) |
Other assets | (15,033) | (833) | (7,559) |
Accounts payable | 26,346 | (15,620) | 7,358 |
Customer deposits | 27,693 | 3,903 | (5,686) |
Other liabilities | 19,453 | (8,586) | (5,662) |
Net cash provided by operating activities | 162,420 | 92,884 | 97,413 |
Investing Activities | |||
Acquisitions, net of cash acquired (Note 2) | (143,981) | (7,095) | (177,798) |
Purchases of property, plant, and equipment | (12,771) | (7,595) | (9,957) |
Proceeds from sale of property, plant, and equipment | 1,740 | 145 | 398 |
Other investing activities | 537 | 0 | 0 |
Net cash used in investing activities | (154,475) | (14,545) | (187,357) |
Financing Activities | |||
Proceeds from issuance of long-term obligations | 151,944 | 26,000 | 247,196 |
Repayment of short- and long-term obligations | (115,576) | (99,547) | (126,315) |
Dividends paid | (11,460) | (10,903) | (10,196) |
Proceeds from issuance of Company common stock | 1,892 | 3,207 | 5,176 |
Tax withholding payments related to stock-based compensation | (3,432) | (2,599) | (2,691) |
Dividend paid to noncontrolling interest | (560) | (525) | (664) |
Other financing activities | 0 | (189) | (56) |
Net cash provided by (used in) financing activities | 22,808 | (84,556) | 112,450 |
Exchange Rate Effect on Cash, Cash Equivalents, and Restricted Cash | (3,232) | 4,584 | (350) |
Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash | 27,521 | (1,633) | 22,156 |
Cash, Cash Equivalents, and Restricted Cash at Beginning of Year | 66,640 | 68,273 | 46,117 |
Cash, Cash Equivalents, and Restricted Cash at End of Year | $ 94,161 | $ 66,640 | $ 68,273 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Capital in Excess of Par Value | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment | Treasury Stock | Accumulated Other Comprehensive Items | Noncontrolling Interest |
Beginning balance (in shares) at Dec. 29, 2018 | 14,624,159 | 3,514,163 | |||||||
Beginning balance at Dec. 29, 2018 | $ 374,571 | $ 146 | $ 104,731 | $ 393,578 | $ (86,111) | $ (39,376) | $ 1,603 | ||
Beginning balance (Accounting Standards Update 2016-02) at Dec. 29, 2018 | $ (17) | $ (17) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 52,564 | 52,068 | 496 | ||||||
Dividends declared - common stock | (10,380) | (10,380) | |||||||
Dividend paid to noncontrolling interest | (664) | (664) | |||||||
Activity under stock plans (in shares) | (299,275) | ||||||||
Activity under stock plans | 9,300 | 1,967 | $ 7,333 | ||||||
Other comprehensive items | 1,705 | 1,756 | (51) | ||||||
Ending balance (in shares) at Dec. 28, 2019 | 14,624,159 | 3,214,888 | |||||||
Ending balance at Dec. 28, 2019 | 427,079 | $ 146 | 106,698 | 435,249 | $ (78,778) | (37,620) | 1,384 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 55,739 | 55,196 | 543 | ||||||
Dividends declared - common stock | (11,045) | (11,045) | |||||||
Dividend paid to noncontrolling interest | (525) | (525) | |||||||
Activity under stock plans (in shares) | (132,969) | ||||||||
Activity under stock plans | 7,385 | 4,126 | $ 3,259 | ||||||
Other comprehensive items | 18,272 | 18,128 | 144 | ||||||
Ending balance (in shares) at Jan. 02, 2021 | 14,624,159 | 3,081,919 | |||||||
Ending balance at Jan. 02, 2021 | 496,905 | $ 146 | 110,824 | 479,400 | $ (75,519) | (19,492) | 1,546 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 84,881 | 84,043 | 838 | ||||||
Dividends declared - common stock | (11,595) | (11,595) | |||||||
Dividend paid to noncontrolling interest | (560) | (560) | |||||||
Activity under stock plans (in shares) | (78,500) | ||||||||
Activity under stock plans | 6,987 | 5,064 | $ 1,923 | ||||||
Other comprehensive items | (10,980) | (10,858) | (122) | ||||||
Noncontrolling interest acquired (Note 2) | 367 | 367 | |||||||
Purchase of shares of noncontrolling interest (Note 2) | (389) | (389) | |||||||
Ending balance (in shares) at Jan. 01, 2022 | 14,624,159 | 3,003,419 | |||||||
Ending balance at Jan. 01, 2022 | $ 565,616 | $ 146 | $ 115,888 | $ 551,848 | $ (73,596) | $ (30,350) | $ 1,680 |
Consolidated Statement of Sto_2
Consolidated Statement of Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Statement of Stockholders' Equity [Abstract] | |||
Dividends declared - common stock (in dollars per share) | $ 1 | $ 0.96 | $ 0.92 |
Nature of Operations and Summar
Nature of Operations and Summary of Significant Accounting Policies | 12 Months Ended |
Jan. 01, 2022 | |
Accounting Policies [Abstract] | |
Nature of Operations and Summary of Significant Accounting Policies | Nature of Operations and Summary of Significant Accounting Policies Nature of Operations Kadant Inc. was incorporated in Delaware in November 1991 and trades on the New York Stock Exchange under the ticker symbol "KAI." Kadant Inc. (together with its subsidiaries, the Company) is a global supplier of technologies and engineered systems that drive Sustainable Industrial Processing. Its products and services play an integral role in enhancing efficiency, optimizing energy utilization, and maximizing productivity in process industries while helping customers advance their sustainability initiatives with products that reduce waste or generate more yield with fewer inputs, particularly fiber, energy, and water. Producing more while consuming less is a core aspect of Sustainable Industrial Processing and a major element of the strategic focus of the Company's three reportable operating segments: Flow Control, Industrial Processing, and Material Handling. Noncontrolling Interest One of the Company's foreign subsidiaries that manufactures fluid-handling products is part of a joint venture agreement with an Italian company in which each holds a 50% ownership interest. The agreement provides the Company's subsidiary with the option to purchase the remaining 50% interest in the joint venture. Principles of Consolidation The accompanying consolidated financial statements of the Company include the accounts of its wholly and majority-owned subsidiaries. All material intercompany accounts and transactions have been eliminated. Fiscal Year Typically, the Company's fiscal quarters and fiscal year consist of 13 and 52 weeks, respectively, ending on the Saturday closest to the end of the corresponding calendar quarter for its fiscal quarters and on the Saturday closest to December 31 for its fourth fiscal quarter and fiscal year. As a result of the difference between the fiscal and calendar periods, a 53rd week is added to the Company's fiscal year every five or six years. In a 53-week fiscal year, the Company's fourth fiscal quarter contains 14 weeks. The Company's fiscal year ended January 1, 2022 (fiscal 2021 or 2021) contained 52 weeks, its fiscal year ended January 2, 2021 (fiscal 2020 or 2020) contained 53 weeks, and its fiscal year ended December 28, 2019 (fiscal 2019 or 2019) contained 52 weeks. Each quarter of fiscal 2021, 2020 and 2019 contained 13 weeks, except the fourth quarter of 2020, which contained 14 weeks. The impact of the additional week in 2020 was not material to the Company's financial results. Financial Statement Presentation Certain reclassifications have been made to prior periods to conform with the current period presentation. On the consolidated statement of cash flows, the Company reclassified the change in customer deposits within operating activities from other current liabilities to a separate line item and the changes in long-term assets and liabilities from other items, net to other assets and other liabilities, respectively. Use of Estimates and Critical Accounting Policies The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Although the Company makes every effort to ensure the accuracy of the estimates and assumptions used in the preparation of its consolidated financial statements or in the application of accounting policies, if business conditions were different, or if the Company were to use different estimates and assumptions, it is possible that materially different amounts could be reported in the Company's consolidated financial statements. Critical accounting policies are defined as those that entail significant judgments and estimates, and could potentially result in materially different results under different assumptions and conditions. The Company believes that the most critical accounting policies upon which its financial position depends, and which involve the most complex or subjective decisions or assessments, concern income taxes, revenue recognition, the valuation of goodwill and intangible assets, and inventories. A discussion of the application of these and other accounting policies is included within this note. Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers (ASC 606). Most of the Company’s revenue is recognized at a point in time for each performance obligation under the contract when the customer obtains control of the goods or service. Most of the Company’s parts and consumables products and its capital products with minimal customization are accounted for at a point in time. The Company has made a policy election to not treat the obligation to ship as a separate performance obligation under the contract and, as a result, the associated shipping costs are reflected in the cost of revenue when revenue is recognized. The remaining portion of the Company's revenue is recognized over time based on an input method that compares the costs incurred to date to the total expected costs required to satisfy the performance obligation. Contracts are accounted for on an over time basis when they include products which have no alternative use and an enforceable right to payment over time. Most of the contracts recognized on an over time basis are for large capital projects. These projects are highly customized for the customer and, as a result, would include a significant cost to rework in the event of cancellation. The following table presents revenue by revenue recognition method: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Point in Time $ 705,709 $ 557,702 $ 611,528 Over Time 80,870 77,326 93,116 $ 786,579 $ 635,028 $ 704,644 The transaction price includes estimated variable consideration where applicable. Such variable consideration relates to certain performance guarantees and rights to return the product. The Company estimates variable consideration as the most likely amount to which it expects to be entitled based on the terms of the contracts with customers and historical experience, where relevant. For contracts with multiple performance obligations, the transaction price is allocated to each performance obligation based on the relative stand-alone selling price. The Company disaggregates its revenue from contracts with customers by reportable operating segment, product type and geography as this best depicts how its revenue is affected by economic factors. The following table presents the disaggregation of revenue by product type and geography: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Revenue by Product Type: Parts and Consumables $ 511,766 $ 417,545 $ 440,699 Capital 274,813 217,483 263,945 $ 786,579 $ 635,028 $ 704,644 Revenue by Geography (based on customer location): North America $ 420,382 $ 360,061 $ 386,952 Europe 220,578 161,527 180,888 Asia 103,810 72,268 84,705 Rest of World 41,809 41,172 52,099 $ 786,579 $ 635,028 $ 704,644 See Note 12 , Business Segment and Geographical Information, for information on the disaggregation of revenue by reportable operating segment. The following table presents contract balances from contracts with customers: (In thousands) January 1, 2022 January 2, 2021 Contract Assets $ 8,626 $ 7,576 Contract Liabilities $ 77,004 $ 39,269 Contract assets in the accompanying consolidated balance sheet represent unbilled revenue associated with revenue recognized on contracts accounted for on an over time basis, which will be billed in future periods based on the contract terms. Contract liabilities consist of short- and long-term customer deposits, advanced billings, and deferred revenue. Deferred revenue is included in other current liabilities and long-term customer deposits are included in other long-term liabilities in the accompanying consolidated balance sheet. Contract liabilities will be recognized as revenue in future periods once the revenue recognition criteria are met. The majority of the contract liabilities relate to advance payments on contracts accounted for at a point in time. These advance payments will be recognized as revenue when the Company's performance obligations have been satisfied, which typically occurs when the product has shipped and control of the asset has transferred to the customer. Contract liabilities increased at year end 2021 principally due to capital equipment orders in the Industrial Processing segment's wood processing business, which the Company expects to recognize as revenue through 2023. The Company recognized revenue of $33,128,000 in 2021 and $30,426,000 in 2020 that was included in the contract liabilities balance at the beginning of 2021 and 2020, respectively. The majority of the Company's contracts for capital equipment have an original expected duration of one year or less. Certain capital contracts require longer lead times and could take up to 24 months to complete. For contracts with an original expected duration of over one year, the aggregate amount of the transaction price allocated to the remaining unsatisfied or partially unsatisfied performance obligations as of year-end 2021 was $37,905,000. The Company will recognize revenue for these performance obligations as they are satisfied, approximately 50% of which is expected to occur within the next twelve months and the remaining 50% after December 31, 2022. Customers in China will often settle their accounts receivable with banker's acceptance drafts, in which case cash settlement will be delayed until the drafts mature or are settled prior to maturity. For customers outside of China, final payment for the majority of the Company's products is received in the quarter following the product shipment. Certain of the Company's contracts include a longer period before final payment is due, which is typically within one year of final shipment or transfer of control to the customer. The Company includes in revenue amounts invoiced for shipping and handling with the corresponding costs reflected in cost of revenue. Provisions for discounts, warranties, returns and other adjustments are provided for in the period in which the related sale was recorded. Sales taxes, value-added taxes, and certain excise taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from revenue. Accounts Receivable and Allowance for Credit Losses Accounts receivable arise from sales on credit to customers, are recorded at the invoiced amount, and do not bear interest. The Company establishes an allowance for credit losses to reduce accounts receivable to the net amount expected to be collected. The Company exercises judgment in determining its allowance for credit losses, which is based on its historical collection and write-off experience, adjusted for current macroeconomic trends and conditions, credit policies, specific customer collection issues, and accounts receivable aging. The Company performs ongoing credit evaluations of its customers and adjusts credit limits based upon payment history and each customer's current creditworthiness. The Company continuously monitors collections and payments from its customers. Account balances are charged off against the allowance when the Company believes it is probable the receivable will not be recovered. In some instances, the Company utilizes letters of credit to mitigate its credit exposure. The changes in the allowance for credit losses are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Balance at Beginning of Year $ 2,977 $ 2,698 $ 2,897 Provision charged to expense 5 356 114 Accounts written off (178) (266) (263) Currency translation (69) 189 (50) Balance at End of Year $ 2,735 $ 2,977 $ 2,698 Banker's Acceptance Drafts Included in Accounts Receivable The Company's Chinese subsidiaries may receive banker's acceptance drafts from customers as payment for their trade accounts receivable. The drafts are non-interest bearing obligations of the issuing bank and generally mature within six months of the origination date. The Company's Chinese subsidiaries may sell the drafts at a discount to a third-party financial institution or transfer the drafts to vendors in settlement of current accounts payable prior to the scheduled maturity date. These drafts, which totaled $8,049,000 at year-end 2021 and $9,445,000 at year-end 2020, are included in accounts receivable in the accompanying consolidated balance sheet until the subsidiary sells the drafts to a bank and receives a discounted amount, transfers the banker's acceptance drafts in settlement of current accounts payable prior to maturity, or obtains cash payment on the scheduled maturity date. Warranty Obligations The Company's contracts covering the sale of its products include warranty provisions that provide assurance to its customers that the products will comply with agreed-upon specifications during a defined period of time. The Company provides for the estimated cost of product warranties at the time of sale based on the historical occurrence rates and repair costs, as well as knowledge of any specific warranty problems that indicate projected warranty costs may vary from historical patterns. The Company negotiates the terms regarding warranty coverage and length of warranty depending on the products and applications. While the Company engages in extensive product quality programs and processes, the Company's warranty obligation is affected by product failure rates, repair costs, service delivery costs incurred in correcting a product failure, and supplier warranties on parts delivered to the Company. Should these factors or actual results differ from the Company's estimates, revisions to the estimated warranty liability would be required. The Company's liability for warranties is included in other current liabilities in the accompanying consolidated balance sheet. The changes in the carrying amount of product warranty obligations are as follows: (In thousands) January 1, 2022 January 2, 2021 Balance at Beginning of Year $ 7,064 $ 6,467 Provision charged to expense 4,366 5,555 Usage (4,268) (5,439) Acquisitions 429 — Currency translation (293) 481 Balance at End of Year $ 7,298 $ 7,064 Leases In accordance with ASC 842, Leases (ASC 842), the Company determines whether an arrangement is, or contains, a lease at inception. Operating lease liabilities are included in other current liabilities and other long-term liabilities and the corresponding right-of use (ROU) assets are included in other assets in the accompanying consolidated balance sheet. Classification of operating lease liabilities as either current or noncurrent is based on the expected timing of payments due under the Company’s lease obligations. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities with original contract terms greater than 12 months are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. Operating leases with an original term of 12 months or less are not recorded in the accompanying consolidated balance sheet. In determining the present value of future lease payments, the Company utilizes either the rate implicit in the lease if that rate is readily determinable or its incremental secured borrowing rate commensurate with the term of the underlying lease. Lease terms may include the effect of options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The Company recognizes operating lease expense for lease payments on a straight-line basis over the lease term. Variable lease costs are not included in fixed lease payments and, as a result, are excluded from the measurement of the ROU assets and lease liabilities. The Company expenses all variable lease costs as incurred, which were not material in 2021 and 2020. As a lessee, the Company accounts for the lease and non-lease components of its real estate and equipment leases as a single lease component. For vehicle leases, the Company does not combine lease and non-lease components. See Note 9 , Leases, for additional information about the Company's lease obligations. Income Taxes In accordance with ASC 740, Income Taxes (ASC 740), the Company recognizes deferred income taxes based on the expected future tax consequences of differences between the financial statement basis and the tax basis of assets and liabilities, calculated using enacted tax rates in effect for the year in which these differences are expected to reverse. A tax valuation allowance is established, as needed, to reduce deferred tax assets to the amount expected to be realized. In the period in which it becomes more likely than not that some or all of the deferred tax assets will be realized, the valuation allowance will be adjusted. It is the Company's policy to provide for uncertain tax positions and the related interest and penalties based upon management's assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes. At January 1, 2022, the Company believes that it has appropriately accounted for any liability for unrecognized tax benefits. To the extent the Company prevails in matters for which a liability for an unrecognized tax benefit is established, the statute of limitations expires for a tax jurisdiction year, or the Company is required to pay amounts in excess of the liability, its effective tax rate in a given financial statement period may be affected. Earnings per Share Basic earnings per share (EPS) is computed by dividing net income attributable to Kadant by the weighted average number of shares outstanding during the year. Diluted EPS is computed using the treasury stock method assuming the effect of all potentially dilutive securities, including stock options, restricted stock units (RSUs) and employee stock purchase plan shares. Cash, Cash Equivalents, and Restricted Cash At year-end 2021 and year-end 2020, cash equivalents included investments in money market funds and highly liquid short-term investments, which had maturities of three months or less at the date of purchase. The carrying amounts of cash equivalents approximate their fair values due to the short-term nature of these instruments. The Company's restricted cash generally serves as collateral for certain banker's acceptance drafts issued to vendors and for bank guarantees associated with providing assurance to customers that the Company will fulfill certain customer obligations entered into in the normal course of business. The majority of these restrictions will expire over the next twelve months. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the accompanying consolidated balance sheet that are shown in aggregate in the consolidated statement of cash flows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Cash and cash equivalents $ 91,186 $ 65,682 $ 66,786 Restricted cash 2,975 958 1,487 Total Cash, Cash Equivalents, and Restricted Cash $ 94,161 $ 66,640 $ 68,273 Supplemental Cash Flow Information (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Cash Paid for Interest $ 4,441 $ 6,899 $ 12,344 Cash Paid for Income Taxes, Net of Refunds $ 24,174 $ 17,506 $ 24,533 Non-Cash Investing Activities: Fair value of assets acquired $ 190,977 $ 9,295 $ 207,223 Cash paid for acquired businesses (152,661) (7,565) (179,693) Liabilities Assumed of Acquired Businesses $ 38,316 $ 1,730 $ 27,530 Non-cash additions to property, plant, and equipment $ 363 $ 1,060 $ 626 Non-Cash Financing Activities: Issuance of Company common stock upon vesting of RSUs $ 4,108 $ 4,781 $ 4,100 Dividends declared but unpaid $ 2,905 $ 2,770 $ 2,628 Inventories Inventories are stated at the lower of cost (on a first-in, first-out; or weighted average basis) or net realizable value and include materials, labor, and manufacturing overhead. The Company regularly reviews its quantities of inventories on hand and compares these amounts to the historical and forecasted usage of and demand for each particular product or product line. The Company records a charge to cost of revenue for excess and obsolete inventory to reduce the carrying value of inventories to net realizable value. The components of inventories are as follows: (In thousands) January 1, 2022 January 2, 2021 Raw Materials $ 59,177 $ 46,413 Work in Process 29,448 17,692 Finished Goods (includes $1,163 and $427 at customer locations) 45,731 42,709 $ 134,356 $ 106,814 Property, Plant, and Equipment Property, plant, and equipment are stated at cost. Assets acquired as part of a business combination are initially recorded at fair value. The costs of additions and improvements are capitalized, while maintenance and repairs are charged to expense as incurred. The Company provides for depreciation and amortization primarily using the straight-line method over the estimated useful lives of the property as follows: buildings, 10 to 40 years; machinery and equipment, 2 to 10 years; and leasehold improvements, the shorter of the term of the lease or the life of the asset. For construction in progress, no provision for depreciation is made until the assets are available and ready for use. Property, plant, and equipment consist of the following: (In thousands) January 1, 2022 January 2, 2021 Land $ 11,011 $ 7,676 Buildings 67,787 60,702 Machinery, Equipment, and Leasehold Improvements 136,656 120,804 Construction in Progress 6,567 3,292 222,021 192,474 Less: Accumulated Depreciation and Amortization 114,032 107,832 $ 107,989 $ 84,642 Depreciation and amortization expense was $13,433,000 in 2021, $12,209,000 in 2020, and $12,236,000 in 2019. See Note 9 , Leases, for further details relating to assets under financing leases included in property, plant and equipment in the accompanying consolidated balance sheet. Intangible Assets, Net Acquired intangible assets by major asset class are as follows: (In thousands) Gross Accumulated Currency Net January 1, 2022 Definite-Lived Customer relationships $ 217,021 $ (79,839) $ (3,455) $ 133,727 Product technology 67,230 (35,833) (1,752) 29,645 Tradenames 7,427 (3,405) (373) 3,649 Other 20,210 (16,250) (561) 3,399 311,888 (135,327) (6,141) 170,420 Indefinite-Lived Tradenames 29,059 — (136) 28,923 Acquired Intangible Assets $ 340,947 $ (135,327) $ (6,277) $ 199,343 (In thousands) Gross Accumulated Currency Net January 2, 2021 Definite-Lived Customer relationships $ 173,728 $ (65,488) $ (1,316) $ 106,924 Product technology 56,111 (31,655) (1,005) 23,451 Tradenames 6,027 (2,946) (282) 2,799 Other 18,248 (14,369) (515) 3,364 254,114 (114,458) (3,118) 136,538 Indefinite-Lived Tradenames 24,100 — 327 24,427 Acquired Intangible Assets $ 278,214 $ (114,458) $ (2,791) $ 160,965 Gross intangible assets include $63,228,000 for acquired intangible assets from acquisitions that occurred in 2021. See Note 2 , Acquisitions, for further details. In connection with its impairment analysis, the Company reduced its definite-lived intangible assets by $499,000 in 2021 and definite and indefinite-lived intangible assets by $1,861,000 in 2020. Additionally, the Company reclassified $1,300,000 of an indefinite-lived tradename to definite-lived in 2020. See Impairment of Long-Lived Assets under the heading Intangible Assets within this note for further details. Intangible assets are recorded at fair value at the date of acquisition. Subsequent impairment charges are reflected as a reduction in the gross balance, as applicable. Definite-lived intangible assets are stated net of accumulated amortization and currency translation in the accompanying consolidated balance sheet. The Company amortizes definite-lived intangible assets over lives that have been determined based on the anticipated cash flow benefits of the intangible asset. Definite-lived intangible assets as of year-end 2021 have a weighted average amortization period of 13 years. Amortization of definite-lived intangible assets was $20,869,000 in 2021, $19,125,000 in 2020, and $20,154,000 in 2019 and was included in selling, general, and administrative (SG&A) expenses in the accompanying consolidated statement of income. The estimated future amortization expense of definite-lived intangible assets is $20,994,000 in 2022; $18,725,000 in 2023; $17,830,000 in 2024; $15,754,000 in 2025; $15,119,000 in 2026; and $81,998,000 in the aggregate thereafter. Goodwill Goodwill represents the excess of the cost of an acquisition over the fair value of the identifiable net assets of the acquired business at the date of acquisition. The Company’s acquisitions have historically been made at prices above the fair value of the acquired net assets, resulting in goodwill, due to the expectation of synergies from combining the businesses. The changes in the carrying amount of goodwill by segment are as follows: (In thousands) Flow Control Industrial Processing Material Handling Total Balance as of December 28, 2019 Gross balance $ 97,680 $ 207,536 $ 116,325 $ 421,541 Accumulated impairment losses — (85,509) — (85,509) Net balance 97,680 122,027 116,325 336,032 2020 Activity Acquisition (Note 2) — 3,953 — 3,953 Currency translation 3,757 4,392 3,619 11,768 Total 2020 activity 3,757 8,345 3,619 15,721 Balance at January 2, 2021 Gross balance 101,437 215,881 119,944 437,262 Accumulated impairment losses — (85,509) — (85,509) Net balance 101,437 130,372 119,944 351,753 2021 Activity Acquisitions (Note 2) 25,805 1,116 26,836 53,757 Currency translation (3,653) (2,015) (2,955) (8,623) Total 2021 activity 22,152 (899) 23,881 45,134 Balance at January 1, 2022 Gross balance 123,589 214,982 143,825 482,396 Accumulated impairment losses — (85,509) — (85,509) Net balance $ 123,589 $ 129,473 $ 143,825 $ 396,887 Impairment of Long-Lived Assets The Company evaluates the recoverability of goodwill and indefinite-lived intangible assets as of the end of each fiscal year, or more frequently if events or changes in circumstances indicate that it is more likely than not that the carrying value of an asset might be impaired. Potential impairment indicators include a significant decline in sales, earnings, or cash flows, material adverse changes in the business climate, and a significant decline in the market capitalization due to a sustained decrease in the Company's stock price. The Company assesses its definite-lived intangible assets for impairment whenever facts and circumstances indicate that the carrying amounts may not be fully recoverable. To analyze recoverability, the Company projects undiscounted net future cash flows over the remaining lives of such assets or asset groups. If these projected cash flows were to be less than the carrying amounts, an impairment loss would be recognized, resulting in a write-down of the assets with a corresponding charge to earnings. The impairment loss would be measured based upon the difference between the carrying amounts of the assets and their fair values calculated using projected discounted cash flows. Goodwill At year-end 2021 and 2020, in connection with its annual impairment analysis, the Company performed a qualitative goodwill impairment assessment (Step 0) for each of its reporting units, except the material handling reporting unit in 2020 discussed below, which indicated that the fair value of each reporting unit exceeded its carrying value, and determined that the assets were not impaired. The impairment analysis included an assessment of certain qualitative factors including, but not limited to, the results of prior fair value calculations, the movement of the Company's share price and market capitalization, the reporting units' and the Company's overall financial performance, and macroeconomic and industry conditions. The Company considered the qualitative factors and weighed the evidence obtained and determined that it was not more likely than not that the fair value of any of the respective reporting unit's assets was less than its carrying amount. Although the Company believes the factors considered in the impairment analysis are reasonable, significant changes in any one of the assumptions used could have produced a different result. In March 2020, the Company experienced a significant decrease in market capitalization due to a decline in the Company’s stock price. During that time, the U.S. stock market also declined significantly amid market volatility driven by the uncertainty surrounding the COVID-19 pandemic. Based on these occurrences, the Company concluded that a triggering event had occurred related to the indefinite-lived assets within its material handling reporting unit. As a result, for each reporting period in 2020, the Company prepared a quantitative impairment analysis (Step 1) for its material handling reporting unit, which indicated that its fair value exceeded its carrying value and the indefinite-lived assets were not impaired. Goodwill by reporting unit is as follows: (In thousands) January 1, 2022 January 2, 2021 Fluid-Handling $ 64,003 $ 65,755 Doctoring, Cleaning, & Filtration 59,586 35,682 Stock-Preparation 20,819 19,685 Wood Processing 108,654 110,687 Material Handling 143,825 119,944 $ 396,887 $ 351,753 Intangible Assets At year-end 2021 and 2020, the Company performed a qualitative impairment analysis on its indefinite-lived intangible assets and determined that the assets were not impaired. No triggering events or indicators of impairment were identified in 2021 or 2020 related to the Company's definite-lived intangible assets, except for the definite-lived intangible assets associated with its existing ceramic blade product line in France in 2021 and its timber-harvesting product line in 2020 both discussed below. In the fourth quarter of 2021, the Company decided to exit its ceramic blade business in France, which became a redundant manufacturing operation as a result of its acquisition of The Clouth Group of Companies in the third quarter of 2021. The Company expects to cease production in June 2022 and exit the facility by the end of 2022. As a result of this decision, the Company recorded an impairment charge of $499,000 in the fourth quarter of 2021 related to its product technology intangible asset. In the fourth quarter of 2020, due to the continued and anticipated decline in demand for the Company's timber-harvesting business' products, and following impairment charges totaling $2,336,000 in 2019 related to this business, the Company performed a quantitative analysis of the recoverability of the related intangible assets in which the income approach discounted cash flow methodology was used. As a result of this analysis, the Company determined that the fair values of the timber-harvesting product line's definite-lived intangible assets related to customer relationships, product technology and tradename were less than their carrying values, and therefore recorded additional impairment charges totaling $1,861,000 in the fourth quarter of 2020. The remaining intangible asset as of year-end 2021 for the timber-harvesting product line is $443,000. Impairment charges for 2021, 2020 and 2019 are included in impairment and other costs, net in the accompanying consolidated statement of income. Business Combinations The Company's acquisitions have been accounted for using the purchase method of accounting under ASC 805, Business Combinations (ASC 805), and the results of the acquired businesses have been included in its consolidated financial statements from their respective dates of acquisition. The Company accounts for all transactions and events in which it obtains control over a business under ASC 805 by establishing the acquisition date and recognizing the fair value of all assets acquired and liabilities assumed. The Company’s acquisitions have historically been made at prices above the fair value of identifiable net assets, resulting in goodwill, due to synergies expected to be realized by combining the bu |
Acquisitions
Acquisitions | 12 Months Ended |
Jan. 01, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Acquisitions 2021 In the third quarter of 2021, the Company acquired all partnership interests and shares in The Clouth Group of Companies (Clouth), for $92,864,000, net of cash acquired plus debt assumed. The majority of the Clouth companies were acquired on July 19, 2021 and the acquisition of the last legal entity occurred on August 10, 2021, which the Company accounted for as a noncontrolling interest during the period from July 19, 2021 to August 10, 2021. The Company funded the purchase price with euro-denominated borrowings under its revolving credit facility and existing cash. Clouth, which is included in the Company's Flow Control segment, is a leading manufacturer of doctor blades and related equipment used in the production of paper, packaging, and tissue. The Company expects several synergies in connection with this acquisition, including deepening its presence in the growing ceramic blade market and expansion of sales at its existing businesses by leveraging Clouth's complementary global geographic footprint. Clouth has three manufacturing facilities in Germany and one in Poland. Goodwill from the Clouth acquisition was $25,806,000, of which $6,836,000 is expected to be deductible for tax purposes over 15 years. In addition, intangible assets acquired were $34,467,000, of which $5,326,000 is expected to be deductible for tax purposes over 15 years. The Company recorded revenue of $23,221,000 and an operating loss of $4,068,000 for Clouth from the date of acquisition, including amortization expense of $3,481,000 associated with acquired profit in inventory and backlog and $2,710,000 of acquisition transaction costs. On August 23, 2021, the Company acquired all the outstanding equity securities in East Chicago Machine Tool Corporation (Balemaster) and certain assets of affiliated companies for $53,747,000, net of cash acquired. Balemaster, which is included in the Company's Material Handling segment, is a leading U.S. manufacturer of horizontal balers and related equipment used primarily for recycling packaging waste at corrugated box plants and large retail and distribution centers. The Company funded the purchase price with borrowings under its revolving credit facility. The Company expects several synergies in connection with the acquisition, including expansion of its presence in the secondary material processing market and creation of new opportunities for leveraging its high-performance balers produced in Europe. Goodwill from the Balemaster acquisition was $26,836,000, none of which is deductible for tax purposes. In addition, intangible assets acquired were $28,060,000, none of which is deductible for tax purposes. The Company recorded revenue of $9,038,000 and operating loss of $641,000 for Balemaster from the date of acquisition, including amortization expense of $2,042,000 associated with acquired profit in inventory and backlog and $782,000 of acquisition transaction costs. In the fourth quarter of 2021, the Company acquired the assets of a business in India, which is included in its Industrial Processing segment, for approximately $2,882,000. The following table summarizes the estimated fair values of assets acquired and liabilities assumed and the purchase price for Clouth and the Company's other acquisitions in 2021. The final purchase accounting and purchase price allocations remain subject to change as the Company continues to refine its preliminary valuation of certain acquired assets and liabilities assumed and the valuation of acquired intangibles, which may result in adjustments to the assets and liabilities, including goodwill. Measurement period adjustments in 2021 did not have a material effect on the Company's consolidated balance sheet or statement of income. (In thousands) Clouth Other Total Net Assets Acquired: Cash and Cash Equivalents $ 4,923 $ 3,757 $ 8,680 Accounts Receivable 6,808 1,641 8,449 Inventories 14,119 4,628 18,747 Property, Plant, and Equipment 24,498 5,143 29,641 Other Assets 5,309 3,167 8,476 Definite-Lived Intangible Assets Customer relationships 20,192 23,100 43,292 Product technology 8,915 2,700 11,615 Tradenames — 1,400 1,400 Other 401 1,560 1,961 Indefinite-Lived Intangible Assets — Tradenames 4,959 — 4,959 Goodwill 25,806 27,951 53,757 Total assets acquired 115,930 75,047 190,977 Short-term Obligations and Current Maturities of Long-term Obligations 1,393 — 1,393 Accounts Payable 1,287 797 2,084 Long-Term Deferred Income Taxes 9,465 6,698 16,163 Long-Term Obligations 4,244 — 4,244 Other Liabilities 7,391 7,166 14,557 Total liabilities assumed 23,780 14,661 38,441 Net assets acquired $ 92,150 $ 60,386 $ 152,536 Purchase Price: Cash Paid $ 92,150 $ 60,386 $ 152,536 The weighted-average amortization period for Clouth's definite-lived intangible assets is 19 years, including weighted-average amortization periods of 24 years for customer relationships and 10 years for product technology. The weighted-average amortization period for the Company's other acquisitions' definite-lived intangible assets is 16 years, including weighted-average amortization periods of 17 years for customer relationships, 13 years for product technology, and 16 years for tradenames. Unaudited Supplemental Pro Forma Information The following unaudited pro forma information provides the effect of the Company's 2021 acquisition of Clouth as if it had occurred at the beginning of 2020: (In thousands, except per share amounts) January 1, January 2, Revenue $ 812,016 $ 682,248 Net Income Attributable to Kadant $ 90,184 $ 55,760 Earnings per Share Attributable to Kadant Basic $ 7.79 $ 4.86 Diluted $ 7.74 $ 4.82 The historical consolidated financial information of the Company and Clouth has been adjusted in the pro forma information above to give effect to pro forma events that are (i) directly attributable to the acquisition and related financing arrangements, (ii) expected to have a continuing impact on the Company, and (iii) factually supportable. Pro forma results include the following non-recurring pro forma adjustments: • Pre-tax charge to cost of revenue of $3,082,000 in 2020 and reversal of $3,082,000 in 2021, for the sale of inventory revalued at the date of acquisition. • Pre-tax charge to SG&A expenses of $3,109,000 in 2020 and reversal of $2,710,000 in 2021 and $399,000 in 2021, for acquisition costs and intangible asset amortization related to acquired backlog, respectively. • Estimated tax effects related to the pro forma adjustments. Pro forma results in 2020 include a pre-tax gain of $4,409,000 from the forgiveness of a shareholder loan at Clouth. These pro forma results of operations have been prepared for comparative purposes only, and they do not purport to be indicative of the results of operations that would have resulted had the acquisition of Clouth occurred as of the beginning of 2020, or that may result in the future. The Company's pro forma results exclude the Company's other acquisitions in 2021 as the inclusion of those results would not have been materially different from the pro forma results presented above had the acquisitions occurred at the beginning of 2020. 2020 On June 1, 2020, the Company acquired Cogent Industrial Technologies Ltd. (Cogent), which is included in its Industrial Processing segment, for approximately $6,866,000, net of cash acquired. The Company funded the acquisition through borrowings under its revolving credit facility. Intangible assets acquired primarily relate to customer relationships with a fair value of $3,350,000. Cogent, based in British Columbia, Canada, is an industrial automation and controls solution provider that offers expertise in process technology integration, industrial automation and controls, industrial safety, project management, and operational performance management systems. On May 28, 2020, the Company also acquired certain intellectual property from a company in Austria, which is included in its Industrial Processing segment, for $416,000, of which $229,000 was paid in the second quarter of 2020 and $125,000 in the first quarter of 2021. The Company expects to pay the remaining amount no later than the first quarter of 2022. Intangible assets acquired represent product technology with a fair value of $557,000 at acquisition date. 2019 On September 3, 2019, the Company acquired certain assets of a business in Brazil, which is included in its Flow Control segment, for approximately $407,000 in cash. On January 2, 2019, the Company acquired, directly and indirectly, all the outstanding equity interests of Syntron Material Handling Group, LLC and certain of its affiliates (SMH) pursuant to an equity purchase agreement, dated December 9, 2018, for $176,855,000, net of cash acquired. The Company funded the acquisition through borrowings under its revolving credit facility. SMH, which is included in the Company's Material Handling segment, has manufacturing operations in Mississippi, United States, and China, and is a leading provider of material handling equipment and systems to various process industries, including mining, aggregates, food processing, packaging, and pulp and paper. Goodwill from the SMH acquisition was $78,592,000, of which $59,195,000 is expected to be deductible for tax purposes over 15 years. In addition, intangible assets acquired were $83,020,000, of which $69,969,000 is expected to be deductible for tax purposes over 15 years. For 2019, the Company recorded revenue of $83,364,000 and operating income of $3,132,000 for SMH from the date of acquisition, including amortization expense of $4,872,000 associated with acquired profit in inventory and backlog and $843,000 of acquisition transaction costs. The following table summarizes the estimated fair values of assets acquired and liabilities assumed and the purchase price for SMH. (In thousands) January 2, 2019 Net Assets Acquired: Cash, Cash Equivalents, and Restricted Cash $ 2,431 Accounts Receivable 10,275 Inventories 13,061 Property, Plant, and Equipment 7,383 Other Assets 12,054 Definite-Lived Intangible Assets Customer relationships 58,300 Product technology 11,000 Other 4,220 Indefinite-Lived Intangible Assets Tradenames 9,500 Goodwill 78,592 Total assets acquired 206,816 Accounts Payable 3,380 Other Current Liabilities 7,954 Long-Term Lease Liabilities 15,244 Long-Term Deferred Income Taxes 952 Total liabilities assumed 27,530 Net assets acquired $ 179,286 Purchase Price: Cash Paid $ 179,286 The weighted average amortization period for the definite-lived intangible assets above is 14 years, including weighted average amortization periods of 15 years for customer relationships, 14 years for product technology, and 8 years for other intangible assets. Unaudited Supplemental Pro Forma Information The following unaudited pro forma information provides the effect of the Company's 2019 acquisition of SMH as if it had occurred at the beginning of 2018: (In thousands, except per share amounts) December 28, Revenue $ 704,644 Net Income Attributable to Kadant $ 56,409 Earnings per Share Attributable to Kadant Basic $ 5.02 Diluted $ 4.92 The historical consolidated financial information of the Company and SMH has been adjusted in the pro forma information to give effect to pro forma events that are directly attributable to the acquisition and related financing arrangements, are expected to have a continuing impact on the Company, and are factually supportable. Pro forma results include the following non-recurring pro forma adjustments, which have been included in the determination of pro forma net income for the year ended December 29, 2018 (not presented), as follows: • Pre-tax reversal of $843,000 to SG&A expenses in 2019 for acquisition transaction costs. • Pre-tax reversal of $3,549,000 to cost of revenue in 2019 for the sale of inventory revalued at the date of acquisition. • Pre-tax reversal of $1,323,000 to SG&A expenses in 2019 for intangible asset amortization related to acquired backlog. • Tax effects related to pro forma adjustments. These pro forma results of operations have been prepared for comparative purposes only, and they do not purport to be indicative of the results of operations that would have resulted had the acquisition of SMH occurred as of the beginning of 2018, or that may result in the future. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Jan. 01, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans Stock-Based Compensation Plans The Company maintains stock-based compensation plans primarily for its key employees and directors, although the plans permit awards to others expected to make significant contributions to the future of the Company. The plans authorize the compensation committee of the Company's board of directors (the board committee) to award a variety of stock and stock-based incentives, such as restricted stock, RSUs, nonqualified and incentive stock options, stock bonus shares, or performance-based shares. The award recipients and the terms of awards granted under these plans are determined by the board committee. Upon a change of control, as defined in the plans, all options or other awards become fully vested and all restrictions lapse. The Company had 336,157 shares available for grant under these stock-based compensation plans at year-end 2021. The Company generally issues its common stock out of treasury stock, to the extent available, for share issuances related to its stock-based compensation plans. The Company recognizes compensation cost for all stock-based awards granted to employees and directors based on the grant date estimate of fair value for those awards. The fair value of RSUs is based on the grant date price of the Company's common stock, reduced by the present value of estimated dividends foregone during the requisite service period. The components of pre-tax stock-based compensation expense included in SG&A expenses in the accompanying consolidated statement of income are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 RSU Awards $ 8,224 $ 6,453 $ 6,616 Employee Stock Purchase Plan Awards 303 323 199 Total $ 8,527 $ 6,776 $ 6,815 The Company grants RSUs to non-employee directors and certain employees. Holders of RSUs have no voting rights and are not entitled to receive cash dividends. Non-Employee Director Restricted Stock Units The Company granted RSU awards consisting of 1,009 RSUs in 2021, 2,085 RSUs in 2020 and 1,858 RSUs in 2019 to each of its incumbent non-employee directors. Half of the RSUs vested on June 1 of each year and the remaining RSUs vested ratably on the last day of the third and fourth fiscal quarters of each year. In addition, the Company granted RSU awards consisting of 1,042 RSUs in July 2020 to its then new non-employee director (former executive director), which vested ratably on the last day of the third and fourth fiscal quarters of 2020. Each RSU issued to the directors represents the right to receive one share of the Company's common stock upon vesting. Performance-Based Restricted Stock Units The Company grants performance-based RSUs to certain officers of the Company. Each performance-based RSU represents the right to receive one share of the Company's common stock upon vesting. The RSUs are subject to adjustment based on the achievement of a performance measure selected for the fiscal year, which historically has been a specified target for adjusted earnings before interest, taxes, depreciation, and amortization (adjusted EBITDA) generated from operations. Following the adjustment, the RSUs are subject to additional time-based vesting, and vest in three The Company recognizes compensation expense associated with performance-based RSUs ratably over the requisite service period for each separately vesting portion of the award based on the grant date fair value, net of actual forfeitures recorded when they occur, and remeasured each reporting period until the total number of RSUs to be issued is known. Unrecognized compensation expense related to the unvested performance-based RSUs totaled $3,231,000 at year-end 2021, and will be recognized over a weighted average period of 1.4 years. The performance-based RSU agreements provide for forfeiture in certain events, such as voluntary or involuntary termination of employment, and for acceleration of vesting in certain events, such as death, disability or a change in control of the Company. If death, disability, or a change in control occurs prior to the end of the performance period, the officer will receive the target RSU amount; otherwise, the officer will receive the number of deliverable RSUs based on the achievement of the performance goal, as stated in the RSU agreements. Time-Based Restricted Stock Units The Company grants time-based RSUs to its officers and other employees of the Company. Each time-based RSU represents the right to receive one share of the Company's common stock upon vesting. The Company recognizes compensation expense associated with these time-based RSUs ratably over the requisite service period for the entire award based on the grant date fair value, and net of actual forfeitures recorded when they occur. The time-based RSU agreement provides for forfeiture in certain events, such as voluntary or involuntary termination of employment, and for acceleration of vesting in certain events, such as death, disability, or a change in control of the Company. Unrecognized compensation expense related to the time-based RSUs totaled $3,932,000 at year-end 2021, and will be recognized over a weighted average period of 1.8 years. Vesting of Restricted Stock Units A summary of the activity of the Company's unvested RSUs in 2021 is as follows: (In thousands, except per share amounts) Units Weighted Unvested RSUs at January 2, 2021 120 $ 92.42 Granted 49 $ 174.52 Vested (61) $ 96.96 Forfeited (1) $ 91.71 Unvested RSUs at January 1, 2022 107 $ 127.70 The weighted average grant date fair value of RSUs granted was $174.52 in 2021, $88.22 in 2020, and $86.50 in 2019. The total fair value of shares vested was $5,892,000 in 2021, $7,343,000 in 2020, and $5,452,000 in 2019. Stock Options The Company has not granted stock options since 2013. Prior to 2014, the Company granted nonqualified stock options to its executive officers that vested over three years and were not exercisable until vested. All options awarded in prior periods were granted at an exercise price equal to the fair market value of the Company's common stock on the date of grant. There were no stock options outstanding at year-end 2021 as all remaining stock options were exercised during the year. A summary of the Company's stock option activity in 2021 is as follows: (In thousands, except per share amounts) Number Weighted Options Outstanding at January 2, 2021 27 $ 24.44 Exercised (27) $ 24.44 Options Outstanding at January 1, 2022 — $ — A summary of the Company's stock option exercises are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Total Intrinsic Value of Options Exercised $ 4,986 $ 4,071 $ 16,796 Cash Received from Options Exercised $ 665 $ 1,123 $ 4,454 Employee Stock Purchase Plan The Company's eligible U.S. employees may elect to participate in its employee stock purchase plan. Under the plan, shares of the Company's common stock may be purchased at a 15% discount from the fair market value at the beginning or end of the purchase period, whichever is lower. Shares purchased under the plan are subject to a one-year resale restriction and are purchased through payroll deductions of up to 10% of each participating employee's gross wages. The Company issued 10,230 shares in 2021, 13,062 shares in 2020, and 13,195 shares for 2019 (issued in 2020) of its common stock under this plan. The Company had 91,643 shares available for grant under the employee stock purchase plan at year-end 2021. 401(k) Savings and Other Defined Contribution Plans The Company's U.S. subsidiaries participate in the Kadant Inc. 401(k) Retirement Savings Plan sponsored by the Company. Contributions to the plan are made by both the employee and the Company and are immediately vested. Company contributions are based upon the level of employee contributions. Certain of the Company's subsidiaries offer other retirement plans, the majority of which are defined contribution plans. Company contributions to these plans are based on formulas determined by the Company. For these plans, the Company contributed and charged to expense $4,706,000 in 2021, $4,501,000 in 2020, and $4,412,000 in 2019. Pension and Other Post-Retirement Defined Benefits Plans The Company sponsors pension and other post-retirement defined benefit plans covering employees at certain U.S. and foreign subsidiaries. In accordance with ASC 715, Compensation-Retirement Benefits (ASC 715), the Company recognizes the funded status of its plans as an asset or liability and changes in the funded status through AOCI, net of tax, in the accompanying consolidated balance sheet. The amounts in AOCI are recognized as net periodic benefit cost pursuant to the Company's accounting policy for amortizing such amounts. Further, actuarial gains and losses that arise in subsequent periods and are not recognized as net periodic benefit cost will be recognized as a component of AOCI, net of tax. The Company records the non-service component of net periodic pension cost in other expense, net in the accompanying consolidated statement of income. Other expense, net in 2019 included a loss of $5,887,000 related to the settlement of the Company’s noncontributory defined benefit pension plan for eligible employees at one of its U.S. divisions and its corporate office (Retirement Plan). The Retirement Plan was terminated in December 2018. Other expense, net in 2019 also included activity related to the Retirement Plan prior to its settlement, including interest costs of $1,334,000, net of an expected return on plan assets of $995,000. The weighted average assumptions used to determine net periodic benefit costs in 2019 for the Retirement Plan was 4.10% for both the discount rate and expected return on plan assets, which were valued using the FTSE Pension Discount Curve. In 2020, the Company made a settlement payment of $2,427,000 related to a restoration plan, also terminated in 2018, which fully supplemented benefits lost for certain executive officers under the Retirement Plan. The remaining disclosure requirements related to the Company’s defined benefit plans are not material for the fiscal years presented. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Jan. 01, 2022 | |
Equity [Abstract] | |
Stockholder's Equity | Stockholders' Equity Preferred Stock The Company's Certificate of Incorporation authorizes up to 5,000,000 shares of preferred stock, $.01 par value per share, for issuance by the Company's board of directors without further shareholder approval. Common Stock At year-end 2021, the Company had reserved 534,535 unissued shares of its common stock for possible issuance under its stock-based compensation plans. |
Income Taxes
Income Taxes | 12 Months Ended |
Jan. 01, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The components of income before provision for income taxes are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Domestic $ 26,599 $ 14,132 $ 93 Foreign 85,453 59,555 68,829 $ 112,052 $ 73,687 $ 68,922 The components of the provision for income taxes are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Current Provision (Benefit): Federal $ 2,173 $ 339 $ (264) Foreign 25,512 16,800 18,778 State 870 667 335 28,555 17,806 18,849 Deferred Provision (Benefit): Federal 1,823 2,146 (453) Foreign (3,430) (2,361) (1,253) State 223 357 (785) (1,384) 142 (2,491) $ 27,171 $ 17,948 $ 16,358 The Company receives a tax deduction upon the exercise of nonqualified stock options and the vesting of RSUs. The Company recognizes excess income tax benefits and tax deficiencies related to stock-based compensation arrangements as discrete items within the provision for income taxes in the reporting period in which they occur. The Company recognized an income tax benefit of $1,808,000 in 2021, $758,000 in 2020 and $3,754,000 in 2019 in the accompanying consolidated statement of income. The provision for income taxes in the accompanying consolidated statement of income differs from the provision calculated by applying the statutory federal income tax rate to income before provision for income taxes due to the following: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Provision for Income Taxes at Statutory Rate $ 23,531 $ 15,474 $ 14,474 Increases (Decreases) Resulting From: Foreign tax rate differential 2,819 1,891 2,584 Nondeductible expenses 1,673 2,117 2,407 Excess tax benefit related to stock-based compensation (1,525) (661) (3,305) State income taxes, net of federal income tax 863 807 (355) U.S. tax cost of foreign earnings 481 599 146 Reversal of tax benefit reserves, net (444) (730) (286) Research and development tax credits (454) (465) (381) Change in valuation allowance (31) (469) 81 Other 258 (615) 993 $ 27,171 $ 17,948 $ 16,358 The Company's net deferred tax liability consists of the following: (In thousands) January 1, 2022 January 2, 2021 Deferred Tax Asset: Net operating loss carryforwards $ 14,162 $ 13,719 Lease liabilities 6,393 6,855 Inventory basis difference 4,600 4,576 Employee compensation 4,368 3,189 Reserves and accruals 3,167 3,565 Capitalized research expenses 2,349 2,668 Foreign, state, and alternative minimum tax credit carryforwards 508 472 Allowance for credit losses 420 397 Other 48 213 Deferred tax asset, gross 36,015 35,654 Less: valuation allowance (9,212) (9,609) Deferred tax asset, net 26,803 26,045 Deferred Tax Liability: Goodwill and intangible assets (43,780) (30,166) Fixed asset basis difference (6,009) (4,964) ROU assets (5,431) (5,812) Provision for unremitted foreign earnings (559) (1,233) Other (1,819) (1,574) Deferred tax liability (57,598) (43,749) Net deferred tax liability $ (30,795) $ (17,704) Deferred tax assets and liabilities are presented in the accompanying consolidated balance sheet within other assets and long-term deferred income taxes on a net basis by tax jurisdiction. The Company has established valuation allowances related to certain domestic and foreign deferred tax assets on deductible temporary differences, tax losses, and tax credit carryforwards. The valuation allowance at year-end 2021 was $9,212,000, consisting of $190,000 in the United States and $9,022,000 in foreign jurisdictions. The decrease in the valuation allowance in 2021 of $397,000 is related primarily to fluctuations in foreign currency exchange rates and utilization of foreign net operating losses, partially offset by an increase in valuation allowance associated with acquired net operating losses. Compliance with ASC 740 requires the Company to periodically evaluate the necessity of establishing or adjusting a valuation allowance for deferred tax assets depending on whether it is more likely than not that a related tax benefit will be realized in future periods. When assessing the need for a valuation allowance in a tax jurisdiction, the Company evaluates the weight of all available evidence to determine whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. As part of this evaluation, the Company considers its cumulative three-year history of earnings before income taxes, taxable income in prior carryback years, future reversals of existing taxable temporary differences, prudent and feasible tax planning strategies, and expected future results of operations. As of year-end 2021, the Company continued to maintain a valuation allowance in the United States against a portion of its state net operating loss carryforwards due to the uncertainty of future profitability in certain state jurisdictions. As of year-end 2021, the Company maintained valuation allowances in certain foreign jurisdictions because of the uncertainty of future profitability within those foreign jurisdictions. At year-end 2021, the Company had U.S. federal and state net operating loss carryforwards of $2,304,000 and $30,830,000, respectively, and foreign net operating loss carryforwards of $56,537,000. The U.S. federal net operating loss carryforward does not expire. The state net operating loss carryforwards begin to expire in 2024 and a portion does not expire. Of the foreign net operating loss carryforwards, $1,499,000 will expire in the years 2024 through 2041, and the remainder do not expire. As of year-end 2021, the Company also had state disallowed business interest expense carryforwards of $67,000 and foreign tax credits of $368,000, of which $120,000 came from the acquisition of SMH. The disallowed business interest expense carryforward does not expire, and the foreign tax credit carryforward begins to expire in 2024. The utilization of these tax attributes is limited to the Company’s future taxable income, and certain of these tax attributes are subject to an annual limitation as a result of the acquisition of SMH, which constitutes a change of ownership as defined under Internal Revenue Code Section 382. At year-end 2021, the Company had approximately $245,079,000 of unremitted foreign earnings. During 2021, the Company repatriated $116,853,000 of previously taxed foreign earnings to the United States and recognized a foreign exchange gain of $517,000 associated with these earnings. Of the earnings repatriated in 2021, $100,765,000 related to a distribution of shares of a foreign subsidiary. The Company intends to repatriate the distributable reserves of select foreign subsidiaries back to the United States and has recognized $570,000 of net tax expense on the estimated repatriation amount during 2021. Except for these select foreign subsidiaries, the Company intends to indefinitely reinvest $223,035,000 of these earnings of its foreign subsidiaries in order to support the current and future capital needs of their operations, including the repayment of the Company’s foreign debt. The related foreign withholding taxes, which would be required if the Company were to remit these foreign earnings to the United States, would be approximately $4,116,000. The Company operates within multiple tax jurisdictions and could be subject to audit in those jurisdictions. Such audits can involve complex income tax issues, which may require an extended period of time to resolve and may cover multiple years. In management's opinion, adequate provisions for income taxes have been made for all years subject to audit. As of year-end 2021, the Company had a liability of $9,731,000 for unrecognized tax benefits which, if recognized, would reduce the effective tax rate. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: (In thousands) January 1, 2022 January 2, 2021 Unrecognized Tax Benefits, Beginning of Year $ 8,337 $ 8,331 Gross Increases—Tax Positions in Prior Periods 2,409 4 Gross Decreases—Tax Positions in Prior Periods (2,182) (21) Gross Increases—Current-period Tax Positions 1,920 1,468 Lapses of Statutes of Limitations (649) (1,488) Currency Translation (104) 43 Unrecognized Tax Benefits, End of Year $ 9,731 $ 8,337 A portion of the unrecognized tax benefits generated in 2021 is offset by deferred tax assets in the accompanying consolidated balance sheet. The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes. The Company has accrued $1,704,000 at year-end 2021 and $1,600,000 at year-end 2020 for the potential payment of interest and penalties. The interest and penalties included in the accompanying consolidated statement of income was a benefit of $129,000 in 2021 and $145,000 in 2020. The Company is currently under audit in one of its foreign tax jurisdictions. During 2021, the Company finalized its examination with the Internal Revenue Service for the tax years 2017 and 2018 with no material adjustments. It is reasonably possible that over the next fiscal year the amount of liability for unrecognized tax benefits may be reduced by up to $1,367,000 primarily from the expiration of tax statutes of limitations. The Company remains subject to U.S. federal income tax examinations for the tax years 2019 through 2021, and to non-U.S. income tax examinations for the tax years 2008 through 2021. In addition, the Company remains subject to state and local income tax examinations in the United States for the tax years 2003 through 2021. |
Short- and Long-Term Obligation
Short- and Long-Term Obligations | 12 Months Ended |
Jan. 01, 2022 | |
Debt Disclosure [Abstract] | |
Short- and Long-Term Obligations | Short- and Long-Term Obligations Short- and long-term obligations are as follows: (In thousands) January 1, 2022 January 2, 2021 Revolving Credit Facility, due 2023 $ 250,267 $ 217,963 Senior Promissory Notes, due 2023 to 2028 10,000 10,000 Finance Leases, due 2022 to 2026 1,610 1,631 Other Borrowings, due 2022 to 2028 7,637 3,880 Total 269,514 233,474 Less: Short-Term Obligations and Current Maturities of Long-Term Obligations (5,356) (1,474) Long-Term Obligations $ 264,158 $ 232,000 See Note 10 , Derivatives, for the fair value information related to the Company's long-term obligations. Revolving Credit Facility The Company entered into an unsecured multi-currency revolving credit facility, dated as of March 1, 2017 (as amended and restated to date, the Credit Agreement). Pursuant to the Credit Agreement, the Company has a borrowing capacity of $400,000,000, with an uncommitted, unsecured incremental borrowing facility of $150,000,000 with a maturity date of December 14, 2023. Interest on borrowings outstanding accrues and is payable in arrears calculated at one of the following rates selected by the Company: (i) the Base Rate, as defined, plus a margin of 0% to 1.25%, or (ii) Eurocurrency Rate, CDOR Rate, and RFR, (with a zero percent floor), as applicable and defined, plus a margin of 1% to 2.25%. The margin is determined based upon the ratio of the Company's total debt, net of unrestricted cash up to $30,000,000 and certain debt obligations, to earnings before interest, taxes, depreciation, and amortization as defined in the Credit Agreement. Obligations under the Credit Agreement may be accelerated upon the occurrence of an event of default, which includes customary events of default under such financing arrangements. In addition, the Credit Agreement contains negative covenants applicable to the Company and its subsidiaries, including financial covenants requiring the Company to maintain a maximum consolidated leverage ratio of 3.75 to 1.00, or, if the Company elects, for the quarter during which a material acquisition occurs and for the three fiscal quarters thereafter, 4.00 to 1.00, and limitations on making certain restricted payments (including dividends and stock repurchases). Loans under the Credit Agreement are guaranteed by certain domestic subsidiaries of the Company. The Company borrowed an aggregate $151,944,000 under the Credit Agreement in fiscal 2021, including $89,944,000 of euro-denominated borrowings, which were primarily used to fund the Company's acquisitions during the year. At year-end 2021, the outstanding balance under the Credit Agreement included $78,267,000 of euro-denominated borrowings. The Company had $149,920,000 of borrowing capacity available at year-end 2021, which was calculated by translating its foreign-denominated borrowings using the borrowing date foreign exchange rate. The weighted average interest rate for the outstanding balance under the Credit Agreement was 1.50% as of year-end 2021. See Note 10 , Derivatives, under the heading Interest Rate Swap Agreements , for information relating to the Company's swap agreement. Senior Promissory Notes In 2018, the Company entered into an uncommitted, unsecured Multi-Currency Note Purchase and Private Shelf Agreement (Note Purchase Agreement). Simultaneous with the execution of the Note Purchase Agreement, the Company issued senior promissory notes (Initial Notes) in an aggregate principal amount of $10,000,000, with a per annum interest rate of 4.90% payable semiannually, and a maturity date of December 14, 2028. The Company is required to prepay a portion of the principal of the Initial Notes beginning on December 14, 2023 and each year thereafter, and may optionally prepay the principal on the Initial Notes, together with any prepayment premium, at any time in accordance with the Note Purchase Agreement. The obligations of the Initial Notes may be accelerated upon an event of default as defined in the Note Purchase Agreement, which includes customary events of default under such financing arrangements. The Initial Notes are pari passu with the Company’s indebtedness under the Credit Agreement, and any other senior debt, subject to certain specified exceptions, and participate in a sharing agreement with respect to the obligations of the Company and its subsidiaries under the Credit Agreement. The Initial Notes are guaranteed by certain of the Company’s domestic subsidiaries. Debt Compliance At year-end 2021, the Company was in compliance with the covenants related to its debt obligations. Finance Leases The Company's finance leases primarily relate to contracts for vehicles. See Note 9 , Leases, for further information relating to the Company's finance leases. Other Borrowings Other borrowings include a sale-leaseback financing arrangement for a manufacturing facility in Germany. Under this arrangement, the quarterly lease payment includes principal, interest, and a payment to the landlord toward a loan receivable. The interest rate on the outstanding obligation is 1.79%. The secured loan receivable, which was included in other current assets in the accompanying consolidated balance sheet, was $1,408,000 at year-end 2021. The lease arrangement provides for a fixed price purchase option, net of the projected loan receivable, of $1,508,000 at the end of the lease term in August 2022. If the Company does not exercise the purchase option for the facility, it will receive cash from the landlord to settle the loan receivable. As of year-end 2021, $3,297,000 was outstanding under this obligation. Other borrowings also include $4,331,000 of debt obligations outstanding at year-end 2021 assumed in the acquisition of Clouth, which has maturity dates ranging from 2022 to 2028 and interest rates up to 1.95%. Annual Repayment Requirements The following schedule presents the annual repayment requirements for the Company’s short-and long-term obligations, excluding finance leases and the sale-leaseback financing arrangement, as of year-end 2021. (In thousands) 2022 $ 1,197 2023 252,855 2024 2,319 2025 2,322 2026 2,150 2027 and Thereafter 3,764 $ 264,607 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jan. 01, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Letters of Credit and Bank Guarantees Outstanding letters of credit and bank guarantees issued on behalf of the Company, principally relating to performance obligations and customer deposit guarantees, totaled $23,464,000 at year-end 2021. Certain of the Company's contracts require the Company to provide a standby letter of credit or bank guarantee to a customer as beneficiary, limited in amount to a negotiated percentage of the total contract value, in order to guarantee warranty and performance obligations of the Company under the contract. Typically, these standby letters of credit and bank guarantees expire without being drawn by the beneficiary. Right of Recourse In the ordinary course of business, the Company's Chinese subsidiaries may receive banker's acceptance drafts from customers as payment for their trade accounts receivable. The drafts are noninterest-bearing obligations of the issuing bank and generally mature within six months of the origination date. The Company's Chinese subsidiaries may use these banker's acceptance drafts prior to the scheduled maturity date to settle outstanding accounts payable with vendors. Banker's acceptance drafts transferred to vendors are subject to customary right of recourse provisions prior to their scheduled maturity dates. The Company had $9,593,000 at year-end 2021 and $7,568,000 at year-end 2020 of banker's acceptance drafts subject to recourse, which were transferred to vendors and had not reached their scheduled maturity dates. Historically, the banker's acceptance drafts have settled upon maturity without any claim of recourse against the Company. Contingencies In the ordinary course of business, the Company is, at times, required to issue limited performance guarantees, some of which do not require the issuance of letters of credit to customers in support of these guarantees, relating to its equipment and systems. The Company generally limits its liability under these guarantees to amounts typically capped at 10% or less of the value of the contract. The Company believes that it has adequate reserves for any potential liability in connection with such guarantees. Litigation From time to time, the Company is subject to various claims and legal proceedings covering a range of matters that arise in the ordinary course of business. Such litigation may include, but is not limited to, claims and counterclaims by and against the Company for breach of contract or warranty, canceled contracts, product liability, or bankruptcy-related claims. For legal proceedings in which a loss is probable and estimable, the Company accrues a loss based on the low end of the range of estimated loss when there is no better estimate within the range. If the Company were found to be liable for any of the claims or counterclaims against it, the Company would incur a charge against earnings for amounts in excess of legal accruals. |
Other Costs, Net
Other Costs, Net | 12 Months Ended |
Jan. 01, 2022 | |
Restructuring and Related Activities [Abstract] | |
Other Costs, Net | Other Costs, Net Restructuring Costs During 2021, the Company recorded restructuring costs totaling $481,000 within its Flow Control segment, including charges for the write-down of certain machinery and equipment of $226,000 and an ROU asset of $79,000, and severance costs of $176,000 related to the reduction of three employees. These actions were taken to eliminate a redundant ceramic blade manufacturing operation in France that resulted from the Company's acquisition of Clouth in the third quarter of 2021. During 2020, the Company recorded restructuring costs totaling $1,118,000, representing severance costs of $659,000 for 34 employees within its Flow Control segment, $277,000 for 26 employees in its Industrial Processing segment, and $182,000 for four employees in its Material Handling segment. The Company also reduced its workforce by 21 employees in its Industrial Processing segment with no associated severance costs. The Company took these cost-containment actions to reduce payroll-related overhead and operating costs in response to the slowdown in the global economy, largely driven by the COVID-19 pandemic. During 2019, the Company experienced a significant decrease in revenue and operating results in its timber-harvesting product line included within its Industrial Processing segment. Given the decline in this business, the Company undertook a restructuring plan in the fourth quarter of 2019 and incurred $192,000 of severance costs associated with the reduction of six employees in Canada. The Company expects to incur additional restructuring charges in 2022 primarily for severance and facility closure costs related to its 2021 restructuring plan, which are not expected to be significant. The Company does not expect to incur additional charges related to the 2020 and 2019 restructuring plans. Restructuring costs are included in impairment and other costs, net in the accompanying consolidated statement of income. A summary of the changes in accrued restructuring costs included in other accrued expenses in the accompanying consolidated balance sheet, which are expected to be paid in 2022, are as follows: (In thousands) Severance 2021 Restructuring Plan Provision $ 176 Usage (19) Currency translation (1) Balance at January 1, 2022 $ 156 2020 Restructuring Plan Provision $ 1,118 Usage (1,052) Currency translation (5) Balance at January 2, 2021 61 Usage (61) Balance at January 1, 2022 $ — 2019 Restructuring Plan Provision $ 192 Usage (109) Currency translation 1 Balance at December 28, 2019 84 Usage (90) Currency translation 6 Balance at January 2, 2021 $ — Other Income Other income consisted of a gain of $515,000 in 2021 related to the sale of a building in Theodore, Alabama, within the Company's Industrial Processing segment for net cash proceeds of $1,634,000. The building was vacated as part of the Company's 2017 restructuring plan to consolidate three of its stock-preparation operations into a single new facility, which was completed in 2018. |
Leases
Leases | 12 Months Ended |
Jan. 01, 2022 | |
Leases [Abstract] | |
Leases | Leases The Company enters into operating and finance lease commitments primarily for its manufacturing and office space, vehicles, and equipment leases that expire on various dates over the next 13 years, some of which include one or more options to extend the lease for up to 5 years. In addition, the Company leases land associated with certain of its buildings in Canada and China under long-term leases expiring on various dates ranging from 2032 to 2071, one of which includes an assumed option to extend the lease for up to 10 years. The components of lease expense are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Operating Lease Cost $ 5,895 $ 5,602 $ 5,534 Short-Term Lease Cost 674 671 715 Finance Lease Cost: ROU asset amortization 1,045 1,157 1,213 Interest on lease liabilities 46 74 94 Total Finance Lease Cost 1,091 1,231 1,307 Total Lease Costs $ 7,660 $ 7,504 $ 7,556 Supplemental cash flow information related to leases is as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Cash Paid for Amounts Included in the Measurement of Lease Liabilities: Operating cash flows from operating leases $ 12,474 $ 5,782 $ 5,636 Operating cash flows from finance leases $ 46 $ 74 $ 93 Financing cash flows from finance leases $ 1,044 $ 1,139 $ 1,144 ROU Assets Obtained in Exchange for Lease Obligations (a): Operating leases $ 7,247 $ 2,560 $ 28,484 Finance leases $ 1,147 $ 622 $ 3,847 (a) Included in 2019 were additions related to the transition adjustment for the adoption of ASC 842. The post-adoption additions of operating leases were $13,167,000, of which $10,994,000 related to ROU assets obtained as part of the acquisition of SMH in 2019. The post-adoption additions of finance leases were $2,496,000, of which $528,000 related to ROU assets obtained as part of the acquisition of SMH. Supplemental balance sheet information related to leases is as follows: (In thousands) Balance Sheet Line Item January 1, 2022 January 2, 2021 Operating Leases: ROU assets (a) Other current assets $ 2,341 $ — ROU assets Other assets 24,998 25,460 Total operating lease assets $ 27,339 $ 25,460 Short-term liabilities Other current liabilities $ 4,596 $ 4,396 Long-term liabilities Other long-term liabilities 19,959 22,198 Total operating lease liabilities $ 24,555 $ 26,594 (In thousands) Balance Sheet Line Item January 1, 2022 January 2, 2021 Finance Leases: ROU assets, at cost Property, plant, and equipment, at cost $ 4,076 $ 3,707 ROU assets accumulated amortization Accumulated depreciation and amortization (2,489) (2,108) ROU assets, net Property, plant, and equipment, net $ 1,587 $ 1,599 Short-term obligations Short-term obligations and current maturities of long-term obligations $ 862 $ 915 Long-term obligations Long-term obligations 748 716 Total finance lease liabilities $ 1,610 $ 1,631 (a) See Note 15 January 1, 2022 January 2, 2021 Weighted Average Remaining Lease Term (in years): Operating leases 8.7 9.4 Finance leases 2.1 2.0 Weighted Average Discount Rate: Operating leases 3.82 % 3.88 % Finance leases 2.55 % 3.52 % As of January 1, 2022, future lease payments for lease liabilities are as follows: Operating Finance (In thousands) Leases Leases 2022 $ 5,379 $ 889 2023 4,316 561 2024 3,292 178 2025 2,727 17 2026 2,179 3 2027 and Thereafter 11,343 — Total Future Lease Payments 29,236 1,648 Less: Imputed Interest (4,681) (38) Present Value of Lease Payments $ 24,555 $ 1,610 As of January 1, 2022, the Company had no significant operating and finance leases that had not yet commenced. |
Leases | Leases The Company enters into operating and finance lease commitments primarily for its manufacturing and office space, vehicles, and equipment leases that expire on various dates over the next 13 years, some of which include one or more options to extend the lease for up to 5 years. In addition, the Company leases land associated with certain of its buildings in Canada and China under long-term leases expiring on various dates ranging from 2032 to 2071, one of which includes an assumed option to extend the lease for up to 10 years. The components of lease expense are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Operating Lease Cost $ 5,895 $ 5,602 $ 5,534 Short-Term Lease Cost 674 671 715 Finance Lease Cost: ROU asset amortization 1,045 1,157 1,213 Interest on lease liabilities 46 74 94 Total Finance Lease Cost 1,091 1,231 1,307 Total Lease Costs $ 7,660 $ 7,504 $ 7,556 Supplemental cash flow information related to leases is as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Cash Paid for Amounts Included in the Measurement of Lease Liabilities: Operating cash flows from operating leases $ 12,474 $ 5,782 $ 5,636 Operating cash flows from finance leases $ 46 $ 74 $ 93 Financing cash flows from finance leases $ 1,044 $ 1,139 $ 1,144 ROU Assets Obtained in Exchange for Lease Obligations (a): Operating leases $ 7,247 $ 2,560 $ 28,484 Finance leases $ 1,147 $ 622 $ 3,847 (a) Included in 2019 were additions related to the transition adjustment for the adoption of ASC 842. The post-adoption additions of operating leases were $13,167,000, of which $10,994,000 related to ROU assets obtained as part of the acquisition of SMH in 2019. The post-adoption additions of finance leases were $2,496,000, of which $528,000 related to ROU assets obtained as part of the acquisition of SMH. Supplemental balance sheet information related to leases is as follows: (In thousands) Balance Sheet Line Item January 1, 2022 January 2, 2021 Operating Leases: ROU assets (a) Other current assets $ 2,341 $ — ROU assets Other assets 24,998 25,460 Total operating lease assets $ 27,339 $ 25,460 Short-term liabilities Other current liabilities $ 4,596 $ 4,396 Long-term liabilities Other long-term liabilities 19,959 22,198 Total operating lease liabilities $ 24,555 $ 26,594 (In thousands) Balance Sheet Line Item January 1, 2022 January 2, 2021 Finance Leases: ROU assets, at cost Property, plant, and equipment, at cost $ 4,076 $ 3,707 ROU assets accumulated amortization Accumulated depreciation and amortization (2,489) (2,108) ROU assets, net Property, plant, and equipment, net $ 1,587 $ 1,599 Short-term obligations Short-term obligations and current maturities of long-term obligations $ 862 $ 915 Long-term obligations Long-term obligations 748 716 Total finance lease liabilities $ 1,610 $ 1,631 (a) See Note 15 January 1, 2022 January 2, 2021 Weighted Average Remaining Lease Term (in years): Operating leases 8.7 9.4 Finance leases 2.1 2.0 Weighted Average Discount Rate: Operating leases 3.82 % 3.88 % Finance leases 2.55 % 3.52 % As of January 1, 2022, future lease payments for lease liabilities are as follows: Operating Finance (In thousands) Leases Leases 2022 $ 5,379 $ 889 2023 4,316 561 2024 3,292 178 2025 2,727 17 2026 2,179 3 2027 and Thereafter 11,343 — Total Future Lease Payments 29,236 1,648 Less: Imputed Interest (4,681) (38) Present Value of Lease Payments $ 24,555 $ 1,610 As of January 1, 2022, the Company had no significant operating and finance leases that had not yet commenced. |
Derivatives
Derivatives | 12 Months Ended |
Jan. 01, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | Derivatives Interest Rate Swap Agreements In 2018, the Company entered into an interest rate swap agreement (2018 Swap Agreement) with Citizens Bank to hedge its exposure to movements in USD LIBOR on its U.S. dollar-denominated debt. The 2018 Swap Agreement has a $15,000,000 notional value and expires on June 30, 2023. On a quarterly basis, the Company receives three-month USD LIBOR, which is subject to a zero percent floor, and pays a fixed rate of interest of 3.15% plus an applicable margin as defined in the Credit Agreement. The Company designated its 2018 Swap Agreement as a cash flow hedge and structured it to be 100% effective. Unrealized gains and losses related to the fair value of the 2018 Swap Agreement are recorded to AOCI, net of tax. In the event of early termination, the Company will receive from or pay to the counterparty the fair value of the 2018 Swap Agreement, and the unrealized gain or loss outstanding will be recognized in earnings. The counterparty to the 2018 Swap Agreement could demand an early termination of that agreement if the Company were to be in default under the Credit Agreement, or any agreement that amends or replaces the Credit Agreement in which the counterparty is a member, and if it were to be unable to cure the default. See Note 6 , Short- and Long-Term Obligations, for further details. Forward Currency-Exchange Contracts The Company uses forward currency-exchange contracts that generally have maturities of twelve months or less to hedge exposures resulting from fluctuations in currency exchange rates. Such exposures result from assets and liabilities that are denominated in currencies other than the functional currencies of the Company's subsidiaries. Forward currency-exchange contracts that hedge forecasted accounts receivable or accounts payable are designated as cash flow hedges and unrecognized gains and losses are recorded to AOCI, net of tax. Deferred gains and losses are recognized in the statement of income in the period in which the underlying transaction occurs. The fair values of forward currency-exchange contracts that are designated as fair value hedges and forward currency-exchange contracts that are not designated as hedges are recognized currently in earnings. Gains and losses reported within SG&A expenses in the accompanying consolidated statement of income associated with the Company's forward currency-exchange contracts that were not designated as hedges were not material in 2021, 2020, and 2019. The following table summarizes the fair value of derivative instruments in the accompanying consolidated balance sheet: January 1, 2022 January 2, 2021 (In thousands) Balance Sheet Asset Notional Asset Notional Derivatives Designated as Hedging Instruments: Derivatives in an Asset Position: Forward currency-exchange contract Other Current Assets $ — $ — $ 25 $ 842 Derivatives in a Liability Position: Forward currency-exchange contract Other Current $ (44) $ 842 $ — $ — 2018 Swap Agreement Other Long-Term $ (550) $ 15,000 $ (1,099) $ 15,000 Derivatives Not Designated as Hedging Instruments: Derivatives in an Asset Position: Forward currency-exchange contracts Other Current Assets $ 14 $ 1,200 $ 12 $ 582 Derivatives in a Liability Position: Forward currency-exchange contracts Other Current $ — $ — $ (7) $ 825 (a) See Note 11 , Fair Value Measurements and Fair Value of Financial Instruments, for the fair value measurements relating to these financial instruments. (b) The year-end 2021 notional amounts are indicative of the level of the Company's recurring derivative activity during the year. The following table summarizes the activity in AOCI associated with the Company's derivative instruments designated as cash flow hedges as of and for the year ended January 1, 2022: (In thousands) Interest Rate Swap Forward Currency- Total Unrealized (Loss) Gain, Net of Tax, at January 2, 2021 $ (846) $ 18 $ (828) Loss (gain) reclassified to earnings (a) 343 (119) 224 Gain recognized in AOCI 74 68 142 Unrealized Loss, Net of Tax, at January 1, 2022 $ (429) $ (33) $ (462) (a) See Note 14 , Accumulated Other Comprehensive Items, for the income statement classification. At year-end 2021, the Company expects to reclassify losses of $337,000 from AOCI to earnings over the next twelve months based on the estimated cash flows of the interest rate swap agreement and the maturity date of the forward currency-exchange contract. |
Fair Value Measurements and Fai
Fair Value Measurements and Fair Value of Financial Instruments | 12 Months Ended |
Jan. 01, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements and Fair Value of Financial Instruments | Fair Value Measurements and Fair Value of Financial Instruments Fair value measurement is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy is established, which prioritizes the inputs used in measuring fair value into three broad levels as follows: • Level 1—Quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs, other than quoted prices in active markets, that are observable either directly or indirectly. • Level 3—Unobservable inputs based on the Company's own assumptions. The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis: Fair Value as of January 1, 2022 (In thousands) Level 1 Level 2 Level 3 Total Assets: Money market funds and time deposits $ 13,458 $ — $ — $ 13,458 Banker's acceptance drafts (a) $ — $ 8,049 $ — $ 8,049 Forward currency-exchange contracts $ — $ 14 $ — $ 14 Liabilities: 2018 Swap Agreement $ — $ 550 $ — $ 550 Forward currency-exchange contract $ — $ 44 $ — $ 44 Fair Value as of January 2, 2021 (In thousands) Level 1 Level 2 Level 3 Total Assets: Money market funds and time deposits $ 8,054 $ — $ — $ 8,054 Banker's acceptance drafts (a) $ — $ 9,445 $ — $ 9,445 Forward currency-exchange contracts $ — $ 37 $ — $ 37 Liabilities: 2018 Swap Agreement $ — $ 1,009 $ — $ 1,009 Forward currency-exchange contracts $ — $ 7 $ — $ 7 (a) Included in accounts receivable in the accompanying consolidated balance sheet. The Company uses the market approach technique to value its financial assets and liabilities, and there were no changes in valuation techniques during 2021. Banker's acceptance drafts are carried at face value which approximates their fair value due to the short-term nature of the negotiable instrument. The fair values of the forward currency-exchange contracts are based on quoted forward foreign exchange rates at the reporting date. The fair value of the 2018 Swap Agreement is based on USD LIBOR yield curves at the reporting date. The forward currency-exchange contracts and the 2018 Swap Agreement are hedges of either recorded assets or liabilities or anticipated transactions and represent the estimated amount the Company would receive or pay upon liquidation of the contracts. Changes in values of the underlying hedged assets and liabilities or anticipated transactions are not reflected in the table above. The carrying value and fair value of the Company's debt obligations, excluding lease obligations, are as follows: January 1, 2022 January 2, 2021 (In thousands) Carrying Fair Carrying Fair Debt Obligations: Revolving credit facility $ 250,267 $ 250,267 $ 217,963 $ 217,963 Senior promissory notes 10,000 10,947 10,000 11,157 Other 4,331 4,331 — — $ 264,598 $ 265,545 $ 227,963 $ 229,120 |
Business Segment and Geographic
Business Segment and Geographical Information | 12 Months Ended |
Jan. 01, 2022 | |
Segment Reporting [Abstract] | |
Business Segment and Geographical Information | Business Segment and Geographical Information The Company has combined its operating entities into three reportable operating segments: Flow Control, Industrial Processing, and Material Handling. The Flow Control segment consists of the fluid-handling and doctoring, cleaning, & filtration product lines; the Industrial Processing segment consists of the wood processing and stock-preparation product lines; and the Material Handling segment consists of the conveying and vibratory, baling, and fiber-based product lines. A description of each segment follows. • Flow Control – Custom-engineered products, systems, and technologies that control the flow of fluids used in industrial and commercial applications to keep critical processes running efficiently in the packaging, tissue, food, metals, and other industrial sectors. The Company's primary products include rotary sealing devices, steam systems, expansion joints, doctor systems, roll and fabric cleaning devices, and filtration and fiber recovery systems. • Industrial Processing – Equipment, machinery, and technologies used to recycle paper and paperboard and process timber for use in the packaging, tissue, wood products and alternative fuel industries, among others. The Company's primary products include stock-preparation systems and recycling equipment, chemical pulping equipment, debarkers, stranders, chippers, and logging machinery. In addition, the Company provides industrial automation and digitization solutions to process industries. • Material Handling – Products and engineered systems used to handle bulk and discrete materials for secondary processing or transport in the aggregates, mining, food, and waste management industries, among others. The Company's primary products include conveying and vibratory equipment and balers. In addition, the Company manufactures and sells biodegradable, absorbent granules used as carriers in agricultural applications and for oil and grease absorption. The following table presents financial information for the Company's reportable operating segments: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Revenue Flow Control (a) $ 288,788 $ 225,444 $ 250,339 Industrial Processing 328,762 261,577 301,948 Material Handling (b) 169,029 148,007 152,357 $ 786,579 $ 635,028 $ 704,644 Income Before Provision for Income Taxes Flow Control (a,c) $ 65,509 $ 51,530 $ 55,343 Industrial Processing (d) 66,569 42,971 49,599 Material Handling (b,e) 17,543 14,375 11,600 Corporate (f) (32,911) (27,752) (28,719) Total operating income 116,710 81,124 87,823 Interest expense, net (g) (4,554) (7,242) (12,542) Other expense, net (g,h) (104) (195) (6,359) $ 112,052 $ 73,687 $ 68,922 Total Assets Flow Control (a) $ 382,379 $ 263,141 $ 262,320 Industrial Processing 405,575 379,965 375,194 Material Handling (b) 334,785 273,909 281,057 Corporate (i) 9,473 10,556 20,816 $ 1,132,212 $ 927,571 $ 939,387 (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Depreciation and Amortization Flow Control (a) $ 8,366 $ 6,333 $ 6,603 Industrial Processing 13,467 13,163 13,012 Material Handling (b) 12,341 11,628 12,528 Corporate 128 210 247 $ 34,302 $ 31,334 $ 32,390 Capital Expenditures Flow Control (a) $ 4,128 $ 2,808 $ 2,639 Industrial Processing 6,412 3,123 5,113 Material Handling (b) 2,211 1,539 2,144 Corporate 20 125 61 $ 12,771 $ 7,595 $ 9,957 Geographical Information Revenue (j): United States (b) $ 328,456 $ 286,015 $ 309,957 China 82,121 51,003 66,480 Canada 79,426 62,059 64,010 Germany (a) 37,178 23,292 29,076 France 28,258 19,725 21,054 Other 231,140 192,934 214,067 $ 786,579 $ 635,028 $ 704,644 Long-lived Assets (k): United States (b) $ 43,418 $ 40,293 $ 42,094 Germany (a) 25,188 6,051 5,925 Canada 8,460 7,221 7,948 Finland 7,347 8,013 6,960 China 6,613 9,844 10,319 Other 16,963 13,220 12,786 $ 107,989 $ 84,642 $ 86,032 (a) Includes the Clouth business in 2021, which was acquired between July 19, 2021 and August 10, 2021 (see Note 2 , Acquisitions). (b) Includes the Balemaster business in 2021, which was acquired on August 23, 2021 (see Note 2 , Acquisitions). (c) Includes acquisition-related expenses of $6,191,000 and impairment and restructuring charges of $980,000 in 2021. Acquisition-related expenses include amortization expense associated with acquired profit in inventory and backlog, and acquisition costs. (d) Includes $1,861,000 of impairment charges in 2020 and $2,336,000 in 2019. (e) Includes acquisition-related expenses of $2,851,000 in 2021, $350,000 in 2020 and $5,715,000 in 2019. Acquisition-related expenses include amortization expense associated with acquired profit in inventory and backlog, and acquisition costs. (f) Represents general and administrative expenses. (g) The Company does not allocate interest and other expense, net to its segments. (h) Includes a pension plan settlement loss of $5,887,000 in 2019. (i) Primarily includes cash and cash equivalents, tax assets, ROU assets, and property, plant, and equipment, net. (j) Revenue is attributed to countries based on customer location. (k) Represents property, plant, and equipment, net. |
Earnings per Share
Earnings per Share | 12 Months Ended |
Jan. 01, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings per Share Basic and diluted EPS were calculated as follows: (In thousands, except per share amounts) January 1, 2022 January 2, 2021 December 28, 2019 Net Income Attributable to Kadant $ 84,043 $ 55,196 $ 52,068 Basic Weighted Average Shares 11,579 11,482 11,235 Effect of Stock Options, Restricted Stock Units and Employee Stock Purchase Plan Shares 76 82 222 Diluted Weighted Average Shares 11,655 11,564 11,457 Basic Earnings per Share $ 7.26 $ 4.81 $ 4.63 Diluted Earnings per Share $ 7.21 $ 4.77 $ 4.54 The effect of outstanding and unvested RSUs of the Company's common stock totaling 14,200 shares in 2021, 22,900 shares in 2020, and 24,000 shares in 2019 was not included in the computation of diluted EPS for the respective periods as the effect would have been antidilutive or, for unvested performance-based RSUs, the performance conditions had not been met as of the end of the reporting periods. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Items | 12 Months Ended |
Jan. 01, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Items | Accumulated Other Comprehensive Items Comprehensive income combines net income and other comprehensive items, which represent certain amounts that are reported as components of stockholders' equity in the accompanying consolidated balance sheet. Changes in each component of AOCI, net of tax, are as follows: (In thousands) Foreign Currency Translation Adjustment Pension and Other Post-Retirement Benefit Liability Adjustments Deferred Loss on Cash Flow Hedges Total Balance at January 2, 2021 $ (17,894) $ (770) $ (828) $ (19,492) Other comprehensive items before reclassifications (11,202) (67) 142 (11,127) Reclassifications from AOCI — 45 224 269 Net current period other comprehensive items (11,202) (22) 366 (10,858) Balance at January 1, 2022 $ (29,096) $ (792) $ (462) $ (30,350) Amounts reclassified out of AOCI are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Statement of Income Line Item Retirement Benefit Plans Recognized net actuarial loss $ (50) $ (66) $ (70) Other expense, net Amortization of prior service cost (12) (55) (6) Other expense, net Pension plan settlement loss — — (5,887) Other expense, net Total expense before income taxes (62) (121) (5,963) Income tax benefit (provision) 17 153 (641) Provision for income taxes (45) 32 (6,604) Cash Flow Hedges (a) Interest rate swap agreements (451) (333) (8) Interest expense Forward currency-exchange contracts — 28 (169) Cost of revenue Forward currency-exchange contracts 157 — — SG&A expense Total expense before income taxes (294) (305) (177) Income tax benefit 70 73 54 Provision for income taxes (224) (232) (123) Total Reclassifications $ (269) $ (200) $ (6,727) (a) See Note 10 , Derivatives, for additional information. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Jan. 01, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent EventThe Company's largest subsidiary in China, which manufactures stock-preparation equipment, is located in an area that has become primarily residential. As a result, the Company entered into several agreements with the local government to sell its existing manufacturing building and land use rights for approximately $25,140,000 and build a new facility in another location. These agreements will become effective when the Company receives the required down payment and secures a land use right in a new location. As of year-end 2021, the Company has received a 25% down payment on the agreed upon sale price with an additional required down payment of 6% expected in the first quarter of 2022. Once the agreements are effective, which is expected in the first quarter of 2022, the Company will recognize a gain on sale and a receivable for the remaining amount of the sale proceeds. The remaining amount of the sale proceeds is due the earlier of when the government sells the property or within two years from the effective date of the agreements. The Company's subsidiary will continue to occupy its current facility until construction on its new facility is complete. As of year-end 2021, the carrying value of the existing building and land use right totaling $5,264,000 is included in other current assets in the accompanying consolidated balance sheet. In addition, in the fourth quarter of 2021, the Company entered into an agreement for a new land use right valued at $3,719,000, which is included in other assets in the accompanying consolidated balance sheet. |
Nature of Operations and Summ_2
Nature of Operations and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 01, 2022 | |
Accounting Policies [Abstract] | |
Principles of consolidation | Principles of Consolidation The accompanying consolidated financial statements of the Company include the accounts of its wholly and majority-owned subsidiaries. All material intercompany accounts and transactions have been eliminated. |
Fiscal year | Fiscal Year Typically, the Company's fiscal quarters and fiscal year consist of 13 and 52 weeks, respectively, ending on the Saturday closest to the end of the corresponding calendar quarter for its fiscal quarters and on the Saturday closest to December 31 for its fourth fiscal quarter and fiscal year. As a result of the difference between the fiscal and calendar periods, a 53rd week is added to the Company's fiscal year every five or six years. In a 53-week fiscal year, the Company's fourth fiscal quarter contains 14 weeks. The Company's fiscal year ended January 1, 2022 (fiscal 2021 or 2021) contained 52 weeks, its fiscal year ended January 2, 2021 (fiscal 2020 or 2020) contained 53 weeks, and its fiscal year ended December 28, 2019 (fiscal 2019 or 2019) contained 52 weeks. Each quarter of fiscal 2021, 2020 and 2019 contained 13 weeks, except the fourth quarter of 2020, which contained 14 weeks. The impact of the additional week in 2020 was not material to the Company's financial results. |
Use of estimates and critical accounting policies | Use of Estimates and Critical Accounting Policies The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Although the Company makes every effort to ensure the accuracy of the estimates and assumptions used in the preparation of its consolidated financial statements or in the application of accounting policies, if business conditions were different, or if the Company were to use different estimates and assumptions, it is possible that materially different amounts could be reported in the Company's consolidated financial statements. |
Revenue recognition | Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers (ASC 606). Most of the Company’s revenue is recognized at a point in time for each performance obligation under the contract when the customer obtains control of the goods or service. Most of the Company’s parts and consumables products and its capital products with minimal customization are accounted for at a point in time. The Company has made a policy election to not treat the obligation to ship as a separate performance obligation under the contract and, as a result, the associated shipping costs are reflected in the cost of revenue when revenue is recognized. The remaining portion of the Company's revenue is recognized over time based on an input method that compares the costs incurred to date to the total expected costs required to satisfy the performance obligation. Contracts are accounted for on an over time basis when they include products which have no alternative use and an enforceable right to payment over time. Most of the contracts recognized on an over time basis are for large capital projects. These projects are highly customized for the customer and, as a result, would include a significant cost to rework in the event of cancellation. The following table presents revenue by revenue recognition method: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Point in Time $ 705,709 $ 557,702 $ 611,528 Over Time 80,870 77,326 93,116 $ 786,579 $ 635,028 $ 704,644 The transaction price includes estimated variable consideration where applicable. Such variable consideration relates to certain performance guarantees and rights to return the product. The Company estimates variable consideration as the most likely amount to which it expects to be entitled based on the terms of the contracts with customers and historical experience, where relevant. For contracts with multiple performance obligations, the transaction price is allocated to each performance obligation based on the relative stand-alone selling price. The Company disaggregates its revenue from contracts with customers by reportable operating segment, product type and geography as this best depicts how its revenue is affected by economic factors. The following table presents the disaggregation of revenue by product type and geography: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Revenue by Product Type: Parts and Consumables $ 511,766 $ 417,545 $ 440,699 Capital 274,813 217,483 263,945 $ 786,579 $ 635,028 $ 704,644 Revenue by Geography (based on customer location): North America $ 420,382 $ 360,061 $ 386,952 Europe 220,578 161,527 180,888 Asia 103,810 72,268 84,705 Rest of World 41,809 41,172 52,099 $ 786,579 $ 635,028 $ 704,644 See Note 12 , Business Segment and Geographical Information, for information on the disaggregation of revenue by reportable operating segment. The following table presents contract balances from contracts with customers: (In thousands) January 1, 2022 January 2, 2021 Contract Assets $ 8,626 $ 7,576 Contract Liabilities $ 77,004 $ 39,269 Contract assets in the accompanying consolidated balance sheet represent unbilled revenue associated with revenue recognized on contracts accounted for on an over time basis, which will be billed in future periods based on the contract terms. Contract liabilities consist of short- and long-term customer deposits, advanced billings, and deferred revenue. Deferred revenue is included in other current liabilities and long-term customer deposits are included in other long-term liabilities in the accompanying consolidated balance sheet. Contract liabilities will be recognized as revenue in future periods once the revenue recognition criteria are met. The majority of the contract liabilities relate to advance payments on contracts accounted for at a point in time. These advance payments will be recognized as revenue when the Company's performance obligations have been satisfied, which typically occurs when the product has shipped and control of the asset has transferred to the customer. Contract liabilities increased at year end 2021 principally due to capital equipment orders in the Industrial Processing segment's wood processing business, which the Company expects to recognize as revenue through 2023. The Company recognized revenue of $33,128,000 in 2021 and $30,426,000 in 2020 that was included in the contract liabilities balance at the beginning of 2021 and 2020, respectively. The majority of the Company's contracts for capital equipment have an original expected duration of one year or less. Certain capital contracts require longer lead times and could take up to 24 months to complete. For contracts with an original expected duration of over one year, the aggregate amount of the transaction price allocated to the remaining unsatisfied or partially unsatisfied performance obligations as of year-end 2021 was $37,905,000. The Company will recognize revenue for these performance obligations as they are satisfied, approximately 50% of which is expected to occur within the next twelve months and the remaining 50% after December 31, 2022. Customers in China will often settle their accounts receivable with banker's acceptance drafts, in which case cash settlement will be delayed until the drafts mature or are settled prior to maturity. For customers outside of China, final payment for the majority of the Company's products is received in the quarter following the product shipment. Certain of the Company's contracts include a longer period before final payment is due, which is typically within one year of final shipment or transfer of control to the customer. The Company includes in revenue amounts invoiced for shipping and handling with the corresponding costs reflected in cost of revenue. Provisions for discounts, warranties, returns and other adjustments are provided for in the period in which the related sale was recorded. Sales taxes, value-added taxes, and certain excise taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from revenue. |
Accounts receivable and allowance for credit losses | Accounts Receivable and Allowance for Credit Losses Accounts receivable arise from sales on credit to customers, are recorded at the invoiced amount, and do not bear interest. The Company establishes an allowance for credit losses to reduce accounts receivable to the net amount expected to be collected. The Company exercises judgment in determining its allowance for credit losses, which is based on its historical collection and write-off experience, adjusted for current macroeconomic trends and conditions, credit policies, specific customer collection issues, and accounts receivable aging. The Company performs ongoing credit evaluations of its customers and adjusts credit limits based upon payment history and each customer's current creditworthiness. The Company continuously monitors collections and payments from its customers. Account balances are charged off against the allowance when the Company believes it is probable the receivable will not be recovered. In some instances, the Company utilizes letters of credit to mitigate its credit exposure. The changes in the allowance for credit losses are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Balance at Beginning of Year $ 2,977 $ 2,698 $ 2,897 Provision charged to expense 5 356 114 Accounts written off (178) (266) (263) Currency translation (69) 189 (50) Balance at End of Year $ 2,735 $ 2,977 $ 2,698 Banker's Acceptance Drafts Included in Accounts Receivable The Company's Chinese subsidiaries may receive banker's acceptance drafts from customers as payment for their trade accounts receivable. The drafts are non-interest bearing obligations of the issuing bank and generally mature within six months of the origination date. The Company's Chinese subsidiaries may sell the drafts at a discount to a third-party financial institution or transfer the drafts to vendors in settlement of current accounts payable prior to the scheduled maturity date. These drafts, which totaled $8,049,000 at year-end 2021 and $9,445,000 at year-end 2020, are included in accounts receivable in the accompanying consolidated balance sheet until the subsidiary sells the drafts to a bank and receives a discounted amount, transfers the banker's acceptance drafts in settlement of current accounts payable prior to maturity, or obtains cash payment on the scheduled maturity date. |
Warranty obligations | Warranty Obligations The Company's contracts covering the sale of its products include warranty provisions that provide assurance to its customers that the products will comply with agreed-upon specifications during a defined period of time. The Company provides for the estimated cost of product warranties at the time of sale based on the historical occurrence rates and repair costs, as well as knowledge of any specific warranty problems that indicate projected warranty costs may vary from historical patterns. The Company negotiates the terms regarding warranty coverage and length of warranty depending on the products and applications. While the Company engages in extensive product quality programs and processes, the Company's warranty obligation is affected by product failure rates, repair costs, service delivery costs incurred in correcting a product failure, and supplier warranties on parts delivered to the Company. Should these factors or actual results differ from the Company's estimates, revisions to the estimated warranty liability would be required. |
Leases | Leases In accordance with ASC 842, Leases (ASC 842), the Company determines whether an arrangement is, or contains, a lease at inception. Operating lease liabilities are included in other current liabilities and other long-term liabilities and the corresponding right-of use (ROU) assets are included in other assets in the accompanying consolidated balance sheet. Classification of operating lease liabilities as either current or noncurrent is based on the expected timing of payments due under the Company’s lease obligations. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities with original contract terms greater than 12 months are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. Operating leases with an original term of 12 months or less are not recorded in the accompanying consolidated balance sheet. In determining the present value of future lease payments, the Company utilizes either the rate implicit in the lease if that rate is readily determinable or its incremental secured borrowing rate commensurate with the term of the underlying lease. Lease terms may include the effect of options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The Company recognizes operating lease expense for lease payments on a straight-line basis over the lease term. Variable lease costs are not included in fixed lease payments and, as a result, are excluded from the measurement of the ROU assets and lease liabilities. The Company expenses all variable lease costs as incurred, which were not material in 2021 and 2020. As a lessee, the Company accounts for the lease and non-lease components of its real estate and equipment leases as a single lease component. For vehicle leases, the Company does not combine lease and non-lease components. |
Income taxes | Income Taxes In accordance with ASC 740, Income Taxes (ASC 740), the Company recognizes deferred income taxes based on the expected future tax consequences of differences between the financial statement basis and the tax basis of assets and liabilities, calculated using enacted tax rates in effect for the year in which these differences are expected to reverse. A tax valuation allowance is established, as needed, to reduce deferred tax assets to the amount expected to be realized. In the period in which it becomes more likely than not that some or all of the deferred tax assets will be realized, the valuation allowance will be adjusted. It is the Company's policy to provide for uncertain tax positions and the related interest and penalties based upon management's assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes. At January 1, 2022, the Company believes that it has appropriately accounted for any liability for |
Earnings per share | Earnings per Share Basic earnings per share (EPS) is computed by dividing net income attributable to Kadant by the weighted average number of shares outstanding during the year. Diluted EPS is computed using the treasury stock method assuming the effect of all potentially dilutive securities, including stock options, restricted stock units (RSUs) and employee stock purchase plan shares. |
Cash and cash equivalents | Cash, Cash Equivalents, and Restricted Cash At year-end 2021 and year-end 2020, cash equivalents included investments in money market funds and highly liquid short-term investments, which had maturities of three months or less at the date of purchase. The carrying amounts of cash equivalents approximate their fair values due to the short-term nature of these instruments. |
Restricted cash | The Company's restricted cash generally serves as collateral for certain banker's acceptance drafts issued to vendors and for bank guarantees associated with providing assurance to customers that the Company will fulfill certain customer obligations entered into in the normal course of business. The majority of these restrictions will expire over the next twelve months. |
Inventories | Inventories Inventories are stated at the lower of cost (on a first-in, first-out; or weighted average basis) or net realizable value and include materials, labor, and manufacturing overhead. The Company regularly reviews its quantities of inventories on hand and compares these amounts to the historical and forecasted usage of and demand for each particular product or product line. The Company records a charge to cost of revenue for excess and obsolete inventory to reduce the carrying value of inventories to net realizable value. |
Property, plant, and equipment | Property, Plant, and Equipment Property, plant, and equipment are stated at cost. Assets acquired as part of a business combination are initially recorded at fair value. The costs of additions and improvements are capitalized, while maintenance and repairs are charged to expense as incurred. The Company provides for depreciation and amortization primarily using the straight-line method over the estimated useful lives of the property as follows: buildings, 10 to 40 years; machinery and equipment, 2 to 10 years; and leasehold improvements, the shorter of the term of the lease or the life of the asset. For construction in progress, no provision for depreciation is made until the assets are available and ready for use. |
Intangible assets | Intangible assets are recorded at fair value at the date of acquisition. Subsequent impairment charges are reflected as a reduction in the gross balance, as applicable. Definite-lived intangible assets are stated net of accumulated amortization and currency translation in the accompanying consolidated balance sheet. The Company amortizes definite-lived intangible assets over lives that have been determined based on the anticipated cash flow benefits of the intangible asset. Definite-lived intangible assets as of year-end 2021 have a weighted average amortization period of 13 years. |
Goodwill | Goodwill Goodwill represents the excess of the cost of an acquisition over the fair value of the identifiable net assets of the acquired business at the date of acquisition. The Company’s acquisitions have historically been made at prices above the fair value of the acquired net assets, resulting in goodwill, due to the expectation of synergies from combining the businesses. |
Impairment of long-lived assets | Impairment of Long-Lived Assets The Company evaluates the recoverability of goodwill and indefinite-lived intangible assets as of the end of each fiscal year, or more frequently if events or changes in circumstances indicate that it is more likely than not that the carrying value of an asset might be impaired. Potential impairment indicators include a significant decline in sales, earnings, or cash flows, material adverse changes in the business climate, and a significant decline in the market capitalization due to a sustained decrease in the Company's stock price. The Company assesses its definite-lived intangible assets for impairment whenever facts and circumstances indicate that the carrying amounts may not be fully recoverable. To analyze recoverability, the Company projects undiscounted net future cash flows over the remaining lives of such assets or asset groups. If these projected cash flows were to be less than the carrying amounts, an impairment loss would be recognized, resulting in a write-down of the assets with a corresponding charge to earnings. The impairment loss would be measured based upon the difference between the carrying amounts of the assets and their fair values calculated using projected discounted cash flows. Goodwill At year-end 2021 and 2020, in connection with its annual impairment analysis, the Company performed a qualitative goodwill impairment assessment (Step 0) for each of its reporting units, except the material handling reporting unit in 2020 discussed below, which indicated that the fair value of each reporting unit exceeded its carrying value, and determined that the assets were not impaired. The impairment analysis included an assessment of certain qualitative factors including, but not limited to, the results of prior fair value calculations, the movement of the Company's share price and market capitalization, the reporting units' and the Company's overall financial performance, and macroeconomic and industry conditions. The Company considered the qualitative factors and weighed the evidence obtained and determined that it was not more likely than not that the fair value of any of the respective reporting unit's assets was less than its carrying amount. Although the Company believes the factors considered in the impairment analysis are reasonable, significant changes in any one of the assumptions used could have produced a different result. In March 2020, the Company experienced a significant decrease in market capitalization due to a decline in the Company’s stock price. During that time, the U.S. stock market also declined significantly amid market volatility driven by the uncertainty surrounding the COVID-19 pandemic. Based on these occurrences, the Company concluded that a |
Business combinations | Business Combinations The Company's acquisitions have been accounted for using the purchase method of accounting under ASC 805, Business Combinations (ASC 805), and the results of the acquired businesses have been included in its consolidated financial statements from their respective dates of acquisition. The Company accounts for all transactions and events in which it obtains control over a business under ASC 805 by establishing the acquisition date and recognizing the fair value of all assets acquired and liabilities assumed. The Company’s acquisitions have historically been made at prices above the fair value of identifiable net assets, resulting in goodwill, due to synergies expected to be realized by combining the businesses. |
Foreign currency translation and transactions | Foreign Currency Translation and Transactions All assets and liabilities of the Company's foreign subsidiaries are translated at fiscal year-end exchange rates, and revenue and expenses are translated at average exchange rates for each quarter in accordance with ASC 830, Foreign Currency Matters . Resulting translation adjustments are reflected in the "accumulated other comprehensive items" (AOCI) component of stockholders' equity (see Note 14 , Accumulated Other Comprehensive Items). Foreign currency transaction gains and losses are included in the accompanying consolidated statement of income and are not material in the three years presented. |
Stock-based compensation | Stock-Based CompensationThe Company recognizes compensation expense for all stock-based awards granted to employees and directors based on the grant date estimate of fair value for those awards. The fair value of RSUs is based on the grant date price of the Company's common stock, reduced by the present value of estimated dividends foregone during the requisite service period. For time-based RSUs, compensation expense is recognized ratably over the requisite service period for the entire award based on the grant date fair value, and net of actual forfeitures recorded when they occur. For performance-based RSUs, compensation expense is recognized ratably over the requisite service period for each separately vesting portion of the award based on the grant date fair value, net of actual forfeitures recorded when they occur, and remeasured each reporting period until the total number of RSUs to be issued is known. Compensation expense related to any modified stock-based awards is based on the fair value for those awards as of the modification date with any remaining incremental compensation expense recognized ratably over the remaining requisite service period. |
Derivatives | Derivatives The Company uses derivative instruments primarily to reduce its exposure to changes in currency exchange rates and interest rates. When the Company enters into a derivative contract, the Company makes a determination as to whether the transaction is deemed to be a hedge for accounting purposes. If a contract is deemed a hedge, the Company formally documents the relationship between the derivative instrument and the risk being hedged. In this documentation, the Company specifically identifies the asset, liability, forecasted transaction, cash flow, or net investment that has been designated as the hedged item, and evaluates whether the derivative instrument is expected to reduce the risks associated with the hedged item. To the extent these criteria are not met, the Company does not use hedge accounting for the derivative. The change in the fair value of a derivative not deemed to be a hedge is recorded currently in earnings. The Company does not hold or engage in transactions involving derivative instruments for purposes other than risk management. ASC 815, Derivatives and Hedging , requires that all derivatives be recognized on the consolidated balance sheet at fair value. For derivatives designated as cash flow hedges, the related gains or losses on these contracts are deferred as a component of AOCI. These deferred gains and losses are recognized in the consolidated statement of income in the period in which the underlying anticipated transaction occurs. For derivatives designated as fair value hedges, the unrealized gains and losses resulting from the impact of currency exchange rate movements are recognized in earnings in the period in which the exchange rates change and offset the currency gains and losses on the underlying exposures being hedged. The Company performs an evaluation of the effectiveness of the hedge both at inception and on an ongoing basis. The ineffective portion of a hedge, if any, and changes in the fair value of a derivative not deemed to be a hedge, are recorded in the accompanying consolidated statement of income. |
Recent accounting pronouncements | Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes. In December 2019, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2019-12, which simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and by clarifying and amending existing guidance, including the recognition of franchise tax, the treatment of a step up in the tax basis of goodwill, and the timing for recognition of enacted changes in tax laws or rates in the interim period annual effective tax rate computation. This new guidance is effective in fiscal 2021, and the transition requirements are primarily prospective. The Company adopted this ASU prospectively at the beginning of fiscal 2021 and its adoption did not have an impact on the consolidated financial statements. Recent Accounting Pronouncements Not Yet Adopted Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting. In March 2020, the FASB issued ASU No. 2020-04, which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of reference rates, such as the London Interbank Offered Rate (LIBOR), if certain criteria are met. Generally, contract modifications related to reference rate reform may be considered an event that does not require remeasurement or reassessment of a previous accounting determination at the modification date. The guidance in this ASU is applicable to the Company's existing contracts and hedging relationships that reference LIBOR and may be adopted prospectively through December 31, 2022. The Company is currently evaluating the effects that the adoption of this ASU will have on its consolidated financial statements. Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. In October 2021, the FASB issued ASU 2021-08, which requires entities to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASU 2014-09, Revenue from Contracts with Customers (Topic 606) . The guidance in this ASU will generally result in the Company recognizing contract assets and contract liabilities at amounts consistent with those recorded by the acquiree immediately before the acquisition date rather than at fair value. This new guidance is effective on a prospective basis in fiscal 2023, with early adoption permitted. The Company is currently evaluating the effect that the adoption of this ASU will have on its consolidated financial statements, which will be dependent on the contract assets and liabilities acquired in future business combinations. |
Pension and other post-retirement benefits plans | Pension and Other Post-Retirement Defined Benefits Plans The Company sponsors pension and other post-retirement defined benefit plans covering employees at certain U.S. and foreign subsidiaries. In accordance with ASC 715, Compensation-Retirement Benefits (ASC 715), the Company recognizes the funded status of its plans as an asset or liability and changes in the funded status through AOCI, net of tax, in the accompanying consolidated balance sheet. The amounts in AOCI are recognized as net periodic benefit cost pursuant to the Company's accounting policy for amortizing such amounts. Further, actuarial gains and losses that arise in subsequent periods and are not recognized as net periodic benefit cost will be recognized as a component of AOCI, net of tax. |
Nature of Operations and Summ_3
Nature of Operations and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Accounting Policies [Abstract] | |
Revenue recognition method and disaggregation of revenue by product type and geography | The following table presents revenue by revenue recognition method: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Point in Time $ 705,709 $ 557,702 $ 611,528 Over Time 80,870 77,326 93,116 $ 786,579 $ 635,028 $ 704,644 The following table presents the disaggregation of revenue by product type and geography: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Revenue by Product Type: Parts and Consumables $ 511,766 $ 417,545 $ 440,699 Capital 274,813 217,483 263,945 $ 786,579 $ 635,028 $ 704,644 Revenue by Geography (based on customer location): North America $ 420,382 $ 360,061 $ 386,952 Europe 220,578 161,527 180,888 Asia 103,810 72,268 84,705 Rest of World 41,809 41,172 52,099 $ 786,579 $ 635,028 $ 704,644 |
Contract balances from contracts with customers | The following table presents contract balances from contracts with customers: (In thousands) January 1, 2022 January 2, 2021 Contract Assets $ 8,626 $ 7,576 Contract Liabilities $ 77,004 $ 39,269 |
Changes in allowance for credit losses | The changes in the allowance for credit losses are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Balance at Beginning of Year $ 2,977 $ 2,698 $ 2,897 Provision charged to expense 5 356 114 Accounts written off (178) (266) (263) Currency translation (69) 189 (50) Balance at End of Year $ 2,735 $ 2,977 $ 2,698 |
Changes in carrying amount of product warranty obligations | The changes in the carrying amount of product warranty obligations are as follows: (In thousands) January 1, 2022 January 2, 2021 Balance at Beginning of Year $ 7,064 $ 6,467 Provision charged to expense 4,366 5,555 Usage (4,268) (5,439) Acquisitions 429 — Currency translation (293) 481 Balance at End of Year $ 7,298 $ 7,064 |
Reconciliation of cash and cash equivalents | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the accompanying consolidated balance sheet that are shown in aggregate in the consolidated statement of cash flows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Cash and cash equivalents $ 91,186 $ 65,682 $ 66,786 Restricted cash 2,975 958 1,487 Total Cash, Cash Equivalents, and Restricted Cash $ 94,161 $ 66,640 $ 68,273 |
Reconciliation of restricted cash | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the accompanying consolidated balance sheet that are shown in aggregate in the consolidated statement of cash flows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Cash and cash equivalents $ 91,186 $ 65,682 $ 66,786 Restricted cash 2,975 958 1,487 Total Cash, Cash Equivalents, and Restricted Cash $ 94,161 $ 66,640 $ 68,273 |
Supplemental cash flow information | Supplemental Cash Flow Information (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Cash Paid for Interest $ 4,441 $ 6,899 $ 12,344 Cash Paid for Income Taxes, Net of Refunds $ 24,174 $ 17,506 $ 24,533 Non-Cash Investing Activities: Fair value of assets acquired $ 190,977 $ 9,295 $ 207,223 Cash paid for acquired businesses (152,661) (7,565) (179,693) Liabilities Assumed of Acquired Businesses $ 38,316 $ 1,730 $ 27,530 Non-cash additions to property, plant, and equipment $ 363 $ 1,060 $ 626 Non-Cash Financing Activities: Issuance of Company common stock upon vesting of RSUs $ 4,108 $ 4,781 $ 4,100 Dividends declared but unpaid $ 2,905 $ 2,770 $ 2,628 |
Components of inventory | The components of inventories are as follows: (In thousands) January 1, 2022 January 2, 2021 Raw Materials $ 59,177 $ 46,413 Work in Process 29,448 17,692 Finished Goods (includes $1,163 and $427 at customer locations) 45,731 42,709 $ 134,356 $ 106,814 |
Property, plant and equipment | Property, plant, and equipment consist of the following: (In thousands) January 1, 2022 January 2, 2021 Land $ 11,011 $ 7,676 Buildings 67,787 60,702 Machinery, Equipment, and Leasehold Improvements 136,656 120,804 Construction in Progress 6,567 3,292 222,021 192,474 Less: Accumulated Depreciation and Amortization 114,032 107,832 $ 107,989 $ 84,642 |
Acquired intangible assets by major asset class | Acquired intangible assets by major asset class are as follows: (In thousands) Gross Accumulated Currency Net January 1, 2022 Definite-Lived Customer relationships $ 217,021 $ (79,839) $ (3,455) $ 133,727 Product technology 67,230 (35,833) (1,752) 29,645 Tradenames 7,427 (3,405) (373) 3,649 Other 20,210 (16,250) (561) 3,399 311,888 (135,327) (6,141) 170,420 Indefinite-Lived Tradenames 29,059 — (136) 28,923 Acquired Intangible Assets $ 340,947 $ (135,327) $ (6,277) $ 199,343 (In thousands) Gross Accumulated Currency Net January 2, 2021 Definite-Lived Customer relationships $ 173,728 $ (65,488) $ (1,316) $ 106,924 Product technology 56,111 (31,655) (1,005) 23,451 Tradenames 6,027 (2,946) (282) 2,799 Other 18,248 (14,369) (515) 3,364 254,114 (114,458) (3,118) 136,538 Indefinite-Lived Tradenames 24,100 — 327 24,427 Acquired Intangible Assets $ 278,214 $ (114,458) $ (2,791) $ 160,965 |
Changes in the carrying amount of goodwill by segment | The changes in the carrying amount of goodwill by segment are as follows: (In thousands) Flow Control Industrial Processing Material Handling Total Balance as of December 28, 2019 Gross balance $ 97,680 $ 207,536 $ 116,325 $ 421,541 Accumulated impairment losses — (85,509) — (85,509) Net balance 97,680 122,027 116,325 336,032 2020 Activity Acquisition (Note 2) — 3,953 — 3,953 Currency translation 3,757 4,392 3,619 11,768 Total 2020 activity 3,757 8,345 3,619 15,721 Balance at January 2, 2021 Gross balance 101,437 215,881 119,944 437,262 Accumulated impairment losses — (85,509) — (85,509) Net balance 101,437 130,372 119,944 351,753 2021 Activity Acquisitions (Note 2) 25,805 1,116 26,836 53,757 Currency translation (3,653) (2,015) (2,955) (8,623) Total 2021 activity 22,152 (899) 23,881 45,134 Balance at January 1, 2022 Gross balance 123,589 214,982 143,825 482,396 Accumulated impairment losses — (85,509) — (85,509) Net balance $ 123,589 $ 129,473 $ 143,825 $ 396,887 |
Goodwill by reporting unit | Goodwill by reporting unit is as follows: (In thousands) January 1, 2022 January 2, 2021 Fluid-Handling $ 64,003 $ 65,755 Doctoring, Cleaning, & Filtration 59,586 35,682 Stock-Preparation 20,819 19,685 Wood Processing 108,654 110,687 Material Handling 143,825 119,944 $ 396,887 $ 351,753 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Summary of assets acquired and liabilities assumed | The following table summarizes the estimated fair values of assets acquired and liabilities assumed and the purchase price for Clouth and the Company's other acquisitions in 2021. The final purchase accounting and purchase price allocations remain subject to change as the Company continues to refine its preliminary valuation of certain acquired assets and liabilities assumed and the valuation of acquired intangibles, which may result in adjustments to the assets and liabilities, including goodwill. Measurement period adjustments in 2021 did not have a material effect on the Company's consolidated balance sheet or statement of income. (In thousands) Clouth Other Total Net Assets Acquired: Cash and Cash Equivalents $ 4,923 $ 3,757 $ 8,680 Accounts Receivable 6,808 1,641 8,449 Inventories 14,119 4,628 18,747 Property, Plant, and Equipment 24,498 5,143 29,641 Other Assets 5,309 3,167 8,476 Definite-Lived Intangible Assets Customer relationships 20,192 23,100 43,292 Product technology 8,915 2,700 11,615 Tradenames — 1,400 1,400 Other 401 1,560 1,961 Indefinite-Lived Intangible Assets — Tradenames 4,959 — 4,959 Goodwill 25,806 27,951 53,757 Total assets acquired 115,930 75,047 190,977 Short-term Obligations and Current Maturities of Long-term Obligations 1,393 — 1,393 Accounts Payable 1,287 797 2,084 Long-Term Deferred Income Taxes 9,465 6,698 16,163 Long-Term Obligations 4,244 — 4,244 Other Liabilities 7,391 7,166 14,557 Total liabilities assumed 23,780 14,661 38,441 Net assets acquired $ 92,150 $ 60,386 $ 152,536 Purchase Price: Cash Paid $ 92,150 $ 60,386 $ 152,536 The following table summarizes the estimated fair values of assets acquired and liabilities assumed and the purchase price for SMH. (In thousands) January 2, 2019 Net Assets Acquired: Cash, Cash Equivalents, and Restricted Cash $ 2,431 Accounts Receivable 10,275 Inventories 13,061 Property, Plant, and Equipment 7,383 Other Assets 12,054 Definite-Lived Intangible Assets Customer relationships 58,300 Product technology 11,000 Other 4,220 Indefinite-Lived Intangible Assets Tradenames 9,500 Goodwill 78,592 Total assets acquired 206,816 Accounts Payable 3,380 Other Current Liabilities 7,954 Long-Term Lease Liabilities 15,244 Long-Term Deferred Income Taxes 952 Total liabilities assumed 27,530 Net assets acquired $ 179,286 Purchase Price: Cash Paid $ 179,286 |
Unaudited supplemental pro forma information | The following unaudited pro forma information provides the effect of the Company's 2021 acquisition of Clouth as if it had occurred at the beginning of 2020: (In thousands, except per share amounts) January 1, January 2, Revenue $ 812,016 $ 682,248 Net Income Attributable to Kadant $ 90,184 $ 55,760 Earnings per Share Attributable to Kadant Basic $ 7.79 $ 4.86 Diluted $ 7.74 $ 4.82 The following unaudited pro forma information provides the effect of the Company's 2019 acquisition of SMH as if it had occurred at the beginning of 2018: (In thousands, except per share amounts) December 28, Revenue $ 704,644 Net Income Attributable to Kadant $ 56,409 Earnings per Share Attributable to Kadant Basic $ 5.02 Diluted $ 4.92 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Components of pre-tax stock-based compensation expense | The components of pre-tax stock-based compensation expense included in SG&A expenses in the accompanying consolidated statement of income are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 RSU Awards $ 8,224 $ 6,453 $ 6,616 Employee Stock Purchase Plan Awards 303 323 199 Total $ 8,527 $ 6,776 $ 6,815 |
Summary of activity of the unvested restricted stock units | A summary of the activity of the Company's unvested RSUs in 2021 is as follows: (In thousands, except per share amounts) Units Weighted Unvested RSUs at January 2, 2021 120 $ 92.42 Granted 49 $ 174.52 Vested (61) $ 96.96 Forfeited (1) $ 91.71 Unvested RSUs at January 1, 2022 107 $ 127.70 |
Stock option activity | A summary of the Company's stock option activity in 2021 is as follows: (In thousands, except per share amounts) Number Weighted Options Outstanding at January 2, 2021 27 $ 24.44 Exercised (27) $ 24.44 Options Outstanding at January 1, 2022 — $ — |
Summary of stock option exercises | A summary of the Company's stock option exercises are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Total Intrinsic Value of Options Exercised $ 4,986 $ 4,071 $ 16,796 Cash Received from Options Exercised $ 665 $ 1,123 $ 4,454 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Income Tax Disclosure [Abstract] | |
Components of income from continuing operations before income taxes | The components of income before provision for income taxes are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Domestic $ 26,599 $ 14,132 $ 93 Foreign 85,453 59,555 68,829 $ 112,052 $ 73,687 $ 68,922 |
Components of the provision for income taxes from continuing operations | The components of the provision for income taxes are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Current Provision (Benefit): Federal $ 2,173 $ 339 $ (264) Foreign 25,512 16,800 18,778 State 870 667 335 28,555 17,806 18,849 Deferred Provision (Benefit): Federal 1,823 2,146 (453) Foreign (3,430) (2,361) (1,253) State 223 357 (785) (1,384) 142 (2,491) $ 27,171 $ 17,948 $ 16,358 |
Income tax reconciliation | The provision for income taxes in the accompanying consolidated statement of income differs from the provision calculated by applying the statutory federal income tax rate to income before provision for income taxes due to the following: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Provision for Income Taxes at Statutory Rate $ 23,531 $ 15,474 $ 14,474 Increases (Decreases) Resulting From: Foreign tax rate differential 2,819 1,891 2,584 Nondeductible expenses 1,673 2,117 2,407 Excess tax benefit related to stock-based compensation (1,525) (661) (3,305) State income taxes, net of federal income tax 863 807 (355) U.S. tax cost of foreign earnings 481 599 146 Reversal of tax benefit reserves, net (444) (730) (286) Research and development tax credits (454) (465) (381) Change in valuation allowance (31) (469) 81 Other 258 (615) 993 $ 27,171 $ 17,948 $ 16,358 |
Net deferred tax (liability) asset | The Company's net deferred tax liability consists of the following: (In thousands) January 1, 2022 January 2, 2021 Deferred Tax Asset: Net operating loss carryforwards $ 14,162 $ 13,719 Lease liabilities 6,393 6,855 Inventory basis difference 4,600 4,576 Employee compensation 4,368 3,189 Reserves and accruals 3,167 3,565 Capitalized research expenses 2,349 2,668 Foreign, state, and alternative minimum tax credit carryforwards 508 472 Allowance for credit losses 420 397 Other 48 213 Deferred tax asset, gross 36,015 35,654 Less: valuation allowance (9,212) (9,609) Deferred tax asset, net 26,803 26,045 Deferred Tax Liability: Goodwill and intangible assets (43,780) (30,166) Fixed asset basis difference (6,009) (4,964) ROU assets (5,431) (5,812) Provision for unremitted foreign earnings (559) (1,233) Other (1,819) (1,574) Deferred tax liability (57,598) (43,749) Net deferred tax liability $ (30,795) $ (17,704) |
Unrecognized tax benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: (In thousands) January 1, 2022 January 2, 2021 Unrecognized Tax Benefits, Beginning of Year $ 8,337 $ 8,331 Gross Increases—Tax Positions in Prior Periods 2,409 4 Gross Decreases—Tax Positions in Prior Periods (2,182) (21) Gross Increases—Current-period Tax Positions 1,920 1,468 Lapses of Statutes of Limitations (649) (1,488) Currency Translation (104) 43 Unrecognized Tax Benefits, End of Year $ 9,731 $ 8,337 |
Short- and Long-Term Obligati_2
Short- and Long-Term Obligations (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Debt Disclosure [Abstract] | |
Short- and long-term obligations | Short- and long-term obligations are as follows: (In thousands) January 1, 2022 January 2, 2021 Revolving Credit Facility, due 2023 $ 250,267 $ 217,963 Senior Promissory Notes, due 2023 to 2028 10,000 10,000 Finance Leases, due 2022 to 2026 1,610 1,631 Other Borrowings, due 2022 to 2028 7,637 3,880 Total 269,514 233,474 Less: Short-Term Obligations and Current Maturities of Long-Term Obligations (5,356) (1,474) Long-Term Obligations $ 264,158 $ 232,000 |
Schedule of repayments of long-term debt | The following schedule presents the annual repayment requirements for the Company’s short-and long-term obligations, excluding finance leases and the sale-leaseback financing arrangement, as of year-end 2021. (In thousands) 2022 $ 1,197 2023 252,855 2024 2,319 2025 2,322 2026 2,150 2027 and Thereafter 3,764 $ 264,607 |
Other Costs, Net (Tables)
Other Costs, Net (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Restructuring and Related Activities [Abstract] | |
Summary of changes in accrued restructuring costs | A summary of the changes in accrued restructuring costs included in other accrued expenses in the accompanying consolidated balance sheet, which are expected to be paid in 2022, are as follows: (In thousands) Severance 2021 Restructuring Plan Provision $ 176 Usage (19) Currency translation (1) Balance at January 1, 2022 $ 156 2020 Restructuring Plan Provision $ 1,118 Usage (1,052) Currency translation (5) Balance at January 2, 2021 61 Usage (61) Balance at January 1, 2022 $ — 2019 Restructuring Plan Provision $ 192 Usage (109) Currency translation 1 Balance at December 28, 2019 84 Usage (90) Currency translation 6 Balance at January 2, 2021 $ — |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Leases [Abstract] | |
Components of lease expense | The components of lease expense are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Operating Lease Cost $ 5,895 $ 5,602 $ 5,534 Short-Term Lease Cost 674 671 715 Finance Lease Cost: ROU asset amortization 1,045 1,157 1,213 Interest on lease liabilities 46 74 94 Total Finance Lease Cost 1,091 1,231 1,307 Total Lease Costs $ 7,660 $ 7,504 $ 7,556 Supplemental cash flow information related to leases is as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Cash Paid for Amounts Included in the Measurement of Lease Liabilities: Operating cash flows from operating leases $ 12,474 $ 5,782 $ 5,636 Operating cash flows from finance leases $ 46 $ 74 $ 93 Financing cash flows from finance leases $ 1,044 $ 1,139 $ 1,144 ROU Assets Obtained in Exchange for Lease Obligations (a): Operating leases $ 7,247 $ 2,560 $ 28,484 Finance leases $ 1,147 $ 622 $ 3,847 (a) Included in 2019 were additions related to the transition adjustment for the adoption of ASC 842. The post-adoption additions of operating leases were $13,167,000, of which $10,994,000 related to ROU assets obtained as part of the acquisition of SMH in 2019. The post-adoption additions of finance leases were $2,496,000, of which $528,000 related to ROU assets obtained as part of the acquisition of SMH. |
Supplemental balance sheet information | Supplemental balance sheet information related to leases is as follows: (In thousands) Balance Sheet Line Item January 1, 2022 January 2, 2021 Operating Leases: ROU assets (a) Other current assets $ 2,341 $ — ROU assets Other assets 24,998 25,460 Total operating lease assets $ 27,339 $ 25,460 Short-term liabilities Other current liabilities $ 4,596 $ 4,396 Long-term liabilities Other long-term liabilities 19,959 22,198 Total operating lease liabilities $ 24,555 $ 26,594 (In thousands) Balance Sheet Line Item January 1, 2022 January 2, 2021 Finance Leases: ROU assets, at cost Property, plant, and equipment, at cost $ 4,076 $ 3,707 ROU assets accumulated amortization Accumulated depreciation and amortization (2,489) (2,108) ROU assets, net Property, plant, and equipment, net $ 1,587 $ 1,599 Short-term obligations Short-term obligations and current maturities of long-term obligations $ 862 $ 915 Long-term obligations Long-term obligations 748 716 Total finance lease liabilities $ 1,610 $ 1,631 (a) See Note 15 January 1, 2022 January 2, 2021 Weighted Average Remaining Lease Term (in years): Operating leases 8.7 9.4 Finance leases 2.1 2.0 Weighted Average Discount Rate: Operating leases 3.82 % 3.88 % Finance leases 2.55 % 3.52 % |
Future lease payments for operating lease liabilities | As of January 1, 2022, future lease payments for lease liabilities are as follows: Operating Finance (In thousands) Leases Leases 2022 $ 5,379 $ 889 2023 4,316 561 2024 3,292 178 2025 2,727 17 2026 2,179 3 2027 and Thereafter 11,343 — Total Future Lease Payments 29,236 1,648 Less: Imputed Interest (4,681) (38) Present Value of Lease Payments $ 24,555 $ 1,610 |
Future lease payments for finance lease liabilities | As of January 1, 2022, future lease payments for lease liabilities are as follows: Operating Finance (In thousands) Leases Leases 2022 $ 5,379 $ 889 2023 4,316 561 2024 3,292 178 2025 2,727 17 2026 2,179 3 2027 and Thereafter 11,343 — Total Future Lease Payments 29,236 1,648 Less: Imputed Interest (4,681) (38) Present Value of Lease Payments $ 24,555 $ 1,610 |
Derivatives (Tables)
Derivatives (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair value of derivative instruments | The following table summarizes the fair value of derivative instruments in the accompanying consolidated balance sheet: January 1, 2022 January 2, 2021 (In thousands) Balance Sheet Asset Notional Asset Notional Derivatives Designated as Hedging Instruments: Derivatives in an Asset Position: Forward currency-exchange contract Other Current Assets $ — $ — $ 25 $ 842 Derivatives in a Liability Position: Forward currency-exchange contract Other Current $ (44) $ 842 $ — $ — 2018 Swap Agreement Other Long-Term $ (550) $ 15,000 $ (1,099) $ 15,000 Derivatives Not Designated as Hedging Instruments: Derivatives in an Asset Position: Forward currency-exchange contracts Other Current Assets $ 14 $ 1,200 $ 12 $ 582 Derivatives in a Liability Position: Forward currency-exchange contracts Other Current $ — $ — $ (7) $ 825 (a) See Note 11 , Fair Value Measurements and Fair Value of Financial Instruments, for the fair value measurements relating to these financial instruments. (b) The year-end 2021 notional amounts are indicative of the level of the Company's recurring derivative activity during the year. |
Activity in accumulated other comprehensive items (AOCI) | The following table summarizes the activity in AOCI associated with the Company's derivative instruments designated as cash flow hedges as of and for the year ended January 1, 2022: (In thousands) Interest Rate Swap Forward Currency- Total Unrealized (Loss) Gain, Net of Tax, at January 2, 2021 $ (846) $ 18 $ (828) Loss (gain) reclassified to earnings (a) 343 (119) 224 Gain recognized in AOCI 74 68 142 Unrealized Loss, Net of Tax, at January 1, 2022 $ (429) $ (33) $ (462) (a) See Note 14 , Accumulated Other Comprehensive Items, for the income statement classification. |
Fair Value Measurements and F_2
Fair Value Measurements and Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair value hierarchy of assets and liabilities measured on a recurring basis | The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis: Fair Value as of January 1, 2022 (In thousands) Level 1 Level 2 Level 3 Total Assets: Money market funds and time deposits $ 13,458 $ — $ — $ 13,458 Banker's acceptance drafts (a) $ — $ 8,049 $ — $ 8,049 Forward currency-exchange contracts $ — $ 14 $ — $ 14 Liabilities: 2018 Swap Agreement $ — $ 550 $ — $ 550 Forward currency-exchange contract $ — $ 44 $ — $ 44 Fair Value as of January 2, 2021 (In thousands) Level 1 Level 2 Level 3 Total Assets: Money market funds and time deposits $ 8,054 $ — $ — $ 8,054 Banker's acceptance drafts (a) $ — $ 9,445 $ — $ 9,445 Forward currency-exchange contracts $ — $ 37 $ — $ 37 Liabilities: 2018 Swap Agreement $ — $ 1,009 $ — $ 1,009 Forward currency-exchange contracts $ — $ 7 $ — $ 7 (a) Included in accounts receivable in the accompanying consolidated balance sheet. |
Carrying value and fair value of debt obligations, excluding lease obligations | The carrying value and fair value of the Company's debt obligations, excluding lease obligations, are as follows: January 1, 2022 January 2, 2021 (In thousands) Carrying Fair Carrying Fair Debt Obligations: Revolving credit facility $ 250,267 $ 250,267 $ 217,963 $ 217,963 Senior promissory notes 10,000 10,947 10,000 11,157 Other 4,331 4,331 — — $ 264,598 $ 265,545 $ 227,963 $ 229,120 |
Business Segment and Geograph_2
Business Segment and Geographical Information (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Segment Reporting [Abstract] | |
Business segment information | The following table presents financial information for the Company's reportable operating segments: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Revenue Flow Control (a) $ 288,788 $ 225,444 $ 250,339 Industrial Processing 328,762 261,577 301,948 Material Handling (b) 169,029 148,007 152,357 $ 786,579 $ 635,028 $ 704,644 Income Before Provision for Income Taxes Flow Control (a,c) $ 65,509 $ 51,530 $ 55,343 Industrial Processing (d) 66,569 42,971 49,599 Material Handling (b,e) 17,543 14,375 11,600 Corporate (f) (32,911) (27,752) (28,719) Total operating income 116,710 81,124 87,823 Interest expense, net (g) (4,554) (7,242) (12,542) Other expense, net (g,h) (104) (195) (6,359) $ 112,052 $ 73,687 $ 68,922 Total Assets Flow Control (a) $ 382,379 $ 263,141 $ 262,320 Industrial Processing 405,575 379,965 375,194 Material Handling (b) 334,785 273,909 281,057 Corporate (i) 9,473 10,556 20,816 $ 1,132,212 $ 927,571 $ 939,387 (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Depreciation and Amortization Flow Control (a) $ 8,366 $ 6,333 $ 6,603 Industrial Processing 13,467 13,163 13,012 Material Handling (b) 12,341 11,628 12,528 Corporate 128 210 247 $ 34,302 $ 31,334 $ 32,390 Capital Expenditures Flow Control (a) $ 4,128 $ 2,808 $ 2,639 Industrial Processing 6,412 3,123 5,113 Material Handling (b) 2,211 1,539 2,144 Corporate 20 125 61 $ 12,771 $ 7,595 $ 9,957 Geographical Information Revenue (j): United States (b) $ 328,456 $ 286,015 $ 309,957 China 82,121 51,003 66,480 Canada 79,426 62,059 64,010 Germany (a) 37,178 23,292 29,076 France 28,258 19,725 21,054 Other 231,140 192,934 214,067 $ 786,579 $ 635,028 $ 704,644 Long-lived Assets (k): United States (b) $ 43,418 $ 40,293 $ 42,094 Germany (a) 25,188 6,051 5,925 Canada 8,460 7,221 7,948 Finland 7,347 8,013 6,960 China 6,613 9,844 10,319 Other 16,963 13,220 12,786 $ 107,989 $ 84,642 $ 86,032 (a) Includes the Clouth business in 2021, which was acquired between July 19, 2021 and August 10, 2021 (see Note 2 , Acquisitions). (b) Includes the Balemaster business in 2021, which was acquired on August 23, 2021 (see Note 2 , Acquisitions). (c) Includes acquisition-related expenses of $6,191,000 and impairment and restructuring charges of $980,000 in 2021. Acquisition-related expenses include amortization expense associated with acquired profit in inventory and backlog, and acquisition costs. (d) Includes $1,861,000 of impairment charges in 2020 and $2,336,000 in 2019. (e) Includes acquisition-related expenses of $2,851,000 in 2021, $350,000 in 2020 and $5,715,000 in 2019. Acquisition-related expenses include amortization expense associated with acquired profit in inventory and backlog, and acquisition costs. (f) Represents general and administrative expenses. (g) The Company does not allocate interest and other expense, net to its segments. (h) Includes a pension plan settlement loss of $5,887,000 in 2019. (i) Primarily includes cash and cash equivalents, tax assets, ROU assets, and property, plant, and equipment, net. (j) Revenue is attributed to countries based on customer location. (k) Represents property, plant, and equipment, net. |
Earnings per Share (Tables)
Earnings per Share (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Earnings Per Share [Abstract] | |
Basic and diluted earnings per share | Basic and diluted EPS were calculated as follows: (In thousands, except per share amounts) January 1, 2022 January 2, 2021 December 28, 2019 Net Income Attributable to Kadant $ 84,043 $ 55,196 $ 52,068 Basic Weighted Average Shares 11,579 11,482 11,235 Effect of Stock Options, Restricted Stock Units and Employee Stock Purchase Plan Shares 76 82 222 Diluted Weighted Average Shares 11,655 11,564 11,457 Basic Earnings per Share $ 7.26 $ 4.81 $ 4.63 Diluted Earnings per Share $ 7.21 $ 4.77 $ 4.54 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Items (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Components of accumulated other comprehensive items in the balance sheet | Changes in each component of AOCI, net of tax, are as follows: (In thousands) Foreign Currency Translation Adjustment Pension and Other Post-Retirement Benefit Liability Adjustments Deferred Loss on Cash Flow Hedges Total Balance at January 2, 2021 $ (17,894) $ (770) $ (828) $ (19,492) Other comprehensive items before reclassifications (11,202) (67) 142 (11,127) Reclassifications from AOCI — 45 224 269 Net current period other comprehensive items (11,202) (22) 366 (10,858) Balance at January 1, 2022 $ (29,096) $ (792) $ (462) $ (30,350) |
Reclassification out of accumulated other comprehensive items | Amounts reclassified out of AOCI are as follows: (In thousands) January 1, 2022 January 2, 2021 December 28, 2019 Statement of Income Line Item Retirement Benefit Plans Recognized net actuarial loss $ (50) $ (66) $ (70) Other expense, net Amortization of prior service cost (12) (55) (6) Other expense, net Pension plan settlement loss — — (5,887) Other expense, net Total expense before income taxes (62) (121) (5,963) Income tax benefit (provision) 17 153 (641) Provision for income taxes (45) 32 (6,604) Cash Flow Hedges (a) Interest rate swap agreements (451) (333) (8) Interest expense Forward currency-exchange contracts — 28 (169) Cost of revenue Forward currency-exchange contracts 157 — — SG&A expense Total expense before income taxes (294) (305) (177) Income tax benefit 70 73 54 Provision for income taxes (224) (232) (123) Total Reclassifications $ (269) $ (200) $ (6,727) (a) See Note 10 , Derivatives, for additional information. |
Nature of Operations and Summ_4
Nature of Operations and Summary of Significant Accounting Policies - Additional Information (Details) | 3 Months Ended | 12 Months Ended | |||
Jan. 01, 2022USD ($) | Jan. 02, 2021USD ($) | Jan. 01, 2022USD ($)segment | Jan. 02, 2021USD ($) | Dec. 28, 2019USD ($) | |
Nature of Operations [Line Items] | |||||
Number of reportable segments | segment | 3 | ||||
Revenue recognized from contract liabilities | $ 33,128,000 | $ 30,426,000 | |||
Revenue, remaining performance obligation, amount | $ 37,905,000 | $ 37,905,000 | |||
Maturity period for bank acceptance | 6 months | ||||
Due from bankers acceptances drafts | 8,049,000 | $ 9,445,000 | $ 8,049,000 | 9,445,000 | |
Finite and indefinite lived intangible assets acquired | 63,228,000 | ||||
Impairment of intangible assets, finite-and definite lived | 1,861,000 | 804,000 | 1,861,000 | $ 2,336,000 | |
Definite-lived intangible assets | 170,420,000 | 136,538,000 | $ 170,420,000 | 136,538,000 | |
Weighted average useful life of acquired intangible assets | 13 years | ||||
Amortization expense of acquired intangible assets | $ 20,869,000 | 19,125,000 | 20,154,000 | ||
Estimated Future Amortization Expense [Abstract] | |||||
2022 | 20,994,000 | 20,994,000 | |||
2023 | 18,725,000 | 18,725,000 | |||
2024 | 17,830,000 | 17,830,000 | |||
2025 | 15,754,000 | 15,754,000 | |||
2026 | 15,119,000 | 15,119,000 | |||
Thereafter | $ 81,998,000 | 81,998,000 | |||
Goodwill impairment loss | 0 | 0 | |||
Acquisition related costs | $ 3,655,000 | 485,000 | 843,000 | ||
Joint Venture with an Italian Company | |||||
Nature of Operations [Line Items] | |||||
Remaining ownership interest with an option to purchase | 50.00% | 50.00% | |||
Italian Company | Joint Venture with an Italian Company | |||||
Nature of Operations [Line Items] | |||||
Ownership interest | 50.00% | 50.00% | |||
Tradenames | |||||
Nature of Operations [Line Items] | |||||
Indefinite-lived intangible assets | $ 28,923,000 | 24,427,000 | $ 28,923,000 | 24,427,000 | |
Product technology | |||||
Nature of Operations [Line Items] | |||||
Impairment of intangible assets, finite-and definite lived | 499,000 | 499,000 | |||
Definite-lived intangible assets | 29,645,000 | 23,451,000 | 29,645,000 | 23,451,000 | |
Tradenames | |||||
Nature of Operations [Line Items] | |||||
Definite-lived intangible assets | 3,649,000 | 2,799,000 | 3,649,000 | 2,799,000 | |
Wood Processing | |||||
Nature of Operations [Line Items] | |||||
Impairment of intangible assets, finite-and definite lived | 1,861,000 | $ 2,336,000 | |||
Definite-lived intangible assets | $ 443,000 | $ 443,000 | |||
Scenario, Adjustment | Madill | Tradenames | |||||
Nature of Operations [Line Items] | |||||
Indefinite-lived intangible assets | (1,300,000) | (1,300,000) | |||
Scenario, Adjustment | Tradenames | Madill | |||||
Nature of Operations [Line Items] | |||||
Definite-lived intangible assets | $ 1,300,000 | $ 1,300,000 |
Nature of Operations and Summ_5
Nature of Operations and Summary of Significant Accounting Policies - Revenue Recognition by Product Type, Geography and Revenue Recognition Method (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 786,579 | $ 635,028 | $ 704,644 |
North America | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 420,382 | 360,061 | 386,952 |
Europe | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 220,578 | 161,527 | 180,888 |
Asia | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 103,810 | 72,268 | 84,705 |
Rest of World | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 41,809 | 41,172 | 52,099 |
Parts and Consumables | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 511,766 | 417,545 | 440,699 |
Capital | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 274,813 | 217,483 | 263,945 |
Point in Time | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 705,709 | 557,702 | 611,528 |
Over Time | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 80,870 | $ 77,326 | $ 93,116 |
Nature of Operations and Summ_6
Nature of Operations and Summary of Significant Accounting Policies - Revenue from Contract with Customers (Details) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Accounting Policies [Abstract] | ||
Contract Assets | $ 8,626 | $ 7,576 |
Contract Liabilities | $ 77,004 | $ 39,269 |
Nature of Operations and Summ_7
Nature of Operations and Summary of Significant Accounting Policies - Performance Obligations Narrative (Details) | Jan. 01, 2022 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-02 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, percent | 50.00% |
Revenue, remaining performance obligation, expected timing of satisfaction after the twelve month period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, percent | 50.00% |
Revenue, remaining performance obligation, expected timing of satisfaction after the twelve month period |
Nature of Operations and Summ_8
Nature of Operations and Summary of Significant Accounting Policies - Changes in the Allowance for Credit Losses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |||
Balance at Beginning of Year | $ 2,977 | $ 2,698 | $ 2,897 |
Provision charged to expense | 5 | 356 | 114 |
Accounts written off | (178) | (266) | (263) |
Currency translation | (69) | 189 | (50) |
Balance at End of Year | $ 2,735 | $ 2,977 | $ 2,698 |
Nature of Operations and Summ_9
Nature of Operations and Summary of Significant Accounting Policies - Product Warranty (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Changes in the carrying amount of accrued warranty costs [Roll Forward] | ||
Balance at Beginning of Year | $ 7,064 | $ 6,467 |
Provision charged to expense | 4,366 | 5,555 |
Usage | (4,268) | (5,439) |
Acquisitions | 429 | 0 |
Currency translation | (293) | 481 |
Balance at End of Year | $ 7,298 | $ 7,064 |
Nature of Operations and Sum_10
Nature of Operations and Summary of Significant Accounting Policies - Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 91,186 | $ 65,682 | $ 66,786 | |
Restricted cash | 2,975 | 958 | 1,487 | |
Total Cash, Cash Equivalents, and Restricted Cash | $ 94,161 | $ 66,640 | $ 68,273 | $ 46,117 |
Nature of Operations and Sum_11
Nature of Operations and Summary of Significant Accounting Policies - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Accounting Policies [Abstract] | |||
Cash Paid for Interest | $ 4,441 | $ 6,899 | $ 12,344 |
Cash Paid for Income Taxes, Net of Refunds | 24,174 | 17,506 | 24,533 |
Non-Cash Investing Activities: | |||
Fair value of assets acquired | 190,977 | 9,295 | 207,223 |
Cash paid for acquired businesses | (152,661) | (7,565) | (179,693) |
Liabilities Assumed of Acquired Businesses | 38,316 | 1,730 | 27,530 |
Non-cash additions to property, plant, and equipment | 363 | 1,060 | 626 |
Non-Cash Financing Activities: | |||
Issuance of Company common stock upon vesting of RSUs | 4,108 | 4,781 | 4,100 |
Dividends declared but unpaid | $ 2,905 | $ 2,770 | $ 2,628 |
Nature of Operations and Sum_12
Nature of Operations and Summary of Significant Accounting Policies - Inventory (Details) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Accounting Policies [Abstract] | ||
Raw Materials | $ 59,177 | $ 46,413 |
Work in Process | 29,448 | 17,692 |
Finished Goods | 45,731 | 42,709 |
Inventories | 134,356 | 106,814 |
Finished goods, at customer locations | $ 1,163 | $ 427 |
Nature of Operations and Sum_13
Nature of Operations and Summary of Significant Accounting Policies - Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 222,021 | $ 192,474 | |
Less: Accumulated Depreciation and Amortization | 114,032 | 107,832 | |
Property, plant and equipment, at cost, net | 107,989 | 84,642 | |
Depreciation and amortization expense for property, plant and equipment and finance lease right-of-use asset | 13,433 | 12,209 | $ 12,236 |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 11,011 | 7,676 | |
Buildings | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 67,787 | 60,702 | |
Machinery, Equipment, and Leasehold Improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 136,656 | 120,804 | |
Construction in Progress | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 6,567 | $ 3,292 | |
Minimum | Machinery and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life (years) | 2 years | ||
Minimum | Buildings | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life (years) | 10 years | ||
Maximum | Machinery and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life (years) | 10 years | ||
Maximum | Buildings | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life (years) | 40 years |
Nature of Operations and Sum_14
Nature of Operations and Summary of Significant Accounting Policies - Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 311,888 | $ 254,114 |
Accumulated Amortization | (135,327) | (114,458) |
Currency Translation | (6,141) | (3,118) |
Net | 170,420 | 136,538 |
Acquired Intangible Assets | ||
Gross | 340,947 | 278,214 |
Accumulated Amortization | (135,327) | (114,458) |
Currency Translation | (6,277) | (2,791) |
Net | 199,343 | 160,965 |
Tradenames | ||
Indefinite-Lived | ||
Gross | 29,059 | 24,100 |
Currency Translation | (136) | 327 |
Net | 28,923 | 24,427 |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | 217,021 | 173,728 |
Accumulated Amortization | (79,839) | (65,488) |
Currency Translation | (3,455) | (1,316) |
Net | 133,727 | 106,924 |
Acquired Intangible Assets | ||
Accumulated Amortization | (79,839) | (65,488) |
Product technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | 67,230 | 56,111 |
Accumulated Amortization | (35,833) | (31,655) |
Currency Translation | (1,752) | (1,005) |
Net | 29,645 | 23,451 |
Acquired Intangible Assets | ||
Accumulated Amortization | (35,833) | (31,655) |
Tradenames | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | 7,427 | 6,027 |
Accumulated Amortization | (3,405) | (2,946) |
Currency Translation | (373) | (282) |
Net | 3,649 | 2,799 |
Acquired Intangible Assets | ||
Accumulated Amortization | (3,405) | (2,946) |
Other | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | 20,210 | 18,248 |
Accumulated Amortization | (16,250) | (14,369) |
Currency Translation | (561) | (515) |
Net | 3,399 | 3,364 |
Acquired Intangible Assets | ||
Accumulated Amortization | $ (16,250) | $ (14,369) |
Nature of Operations and Sum_15
Nature of Operations and Summary of Significant Accounting Policies - Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Goodwill [Roll Forward] | ||
Gross balance, beginning balance | $ 437,262 | $ 421,541 |
Accumulated impairment losses | (85,509) | (85,509) |
Net balance, beginning balance | 351,753 | 336,032 |
Increase due to acquisition | 53,757 | 3,953 |
Currency translation | (8,623) | 11,768 |
Goodwill period activity | 45,134 | 15,721 |
Gross balance, ending balance | 482,396 | 437,262 |
Accumulated impairment losses | (85,509) | (85,509) |
Net balance, ending balance | 396,887 | 351,753 |
Fluid-Handling | ||
Goodwill [Roll Forward] | ||
Net balance, beginning balance | 65,755 | |
Net balance, ending balance | 64,003 | 65,755 |
Doctoring, Cleaning, & Filtration | ||
Goodwill [Roll Forward] | ||
Net balance, beginning balance | 35,682 | |
Net balance, ending balance | 59,586 | 35,682 |
Stock-Preparation | ||
Goodwill [Roll Forward] | ||
Net balance, beginning balance | 19,685 | |
Net balance, ending balance | 20,819 | 19,685 |
Wood Processing | ||
Goodwill [Roll Forward] | ||
Net balance, beginning balance | 110,687 | |
Net balance, ending balance | 108,654 | 110,687 |
Material Handling | ||
Goodwill [Roll Forward] | ||
Net balance, beginning balance | 119,944 | |
Net balance, ending balance | 143,825 | 119,944 |
Operating Segments | Flow Control | ||
Goodwill [Roll Forward] | ||
Gross balance, beginning balance | 101,437 | 97,680 |
Accumulated impairment losses | 0 | 0 |
Net balance, beginning balance | 101,437 | 97,680 |
Increase due to acquisition | 25,805 | 0 |
Currency translation | (3,653) | 3,757 |
Goodwill period activity | 22,152 | 3,757 |
Gross balance, ending balance | 123,589 | 101,437 |
Accumulated impairment losses | 0 | 0 |
Net balance, ending balance | 123,589 | 101,437 |
Operating Segments | Industrial Processing | ||
Goodwill [Roll Forward] | ||
Gross balance, beginning balance | 215,881 | 207,536 |
Accumulated impairment losses | (85,509) | (85,509) |
Net balance, beginning balance | 130,372 | 122,027 |
Increase due to acquisition | 1,116 | 3,953 |
Currency translation | (2,015) | 4,392 |
Goodwill period activity | (899) | 8,345 |
Gross balance, ending balance | 214,982 | 215,881 |
Accumulated impairment losses | (85,509) | (85,509) |
Net balance, ending balance | 129,473 | 130,372 |
Operating Segments | Material Handling | ||
Goodwill [Roll Forward] | ||
Gross balance, beginning balance | 119,944 | 116,325 |
Accumulated impairment losses | 0 | 0 |
Net balance, beginning balance | 119,944 | 116,325 |
Increase due to acquisition | 26,836 | 0 |
Currency translation | (2,955) | 3,619 |
Goodwill period activity | 23,881 | 3,619 |
Gross balance, ending balance | 143,825 | 119,944 |
Accumulated impairment losses | 0 | 0 |
Net balance, ending balance | $ 143,825 | $ 119,944 |
Acquisitions - 2021 Acquisition
Acquisitions - 2021 Acquisition Additional Information (Details) | Aug. 23, 2021USD ($) | Jan. 01, 2022USD ($) | Oct. 02, 2021USD ($)facility | Jan. 01, 2022USD ($) | Jan. 01, 2022USD ($) | Jan. 01, 2022USD ($) | Jan. 02, 2021USD ($) | Dec. 28, 2019USD ($) |
Business Acquisition [Line Items] | ||||||||
Goodwill | $ 396,887,000 | $ 396,887,000 | $ 396,887,000 | $ 396,887,000 | $ 351,753,000 | $ 336,032,000 | ||
Acquisition related costs | 3,655,000 | 485,000 | 843,000 | |||||
Payments to acquire businesses, net of cash acquired | 143,981,000 | $ 7,095,000 | $ 177,798,000 | |||||
Clouth | ||||||||
Business Acquisition [Line Items] | ||||||||
Consideration transferred | $ 92,864,000 | |||||||
Goodwill | 25,806,000 | |||||||
Goodwill, expected tax deductible amount | 6,836,000 | |||||||
Intangible assets other than goodwill acquired | 34,467,000 | |||||||
Intangible assets other than goodwill, expected tax deductible amount | $ 5,326,000 | |||||||
Revenue from the date of acquisition | 23,221,000 | |||||||
Operating income (loss) from date of acquisition | (4,068,000) | |||||||
Amortization expense | 3,481,000 | |||||||
Acquisition related costs | 2,710,000 | |||||||
Clouth | Germany | ||||||||
Business Acquisition [Line Items] | ||||||||
Number of manufacturing facilities | facility | 3 | |||||||
Clouth | Poland | ||||||||
Business Acquisition [Line Items] | ||||||||
Number of manufacturing facilities | facility | 1 | |||||||
Balemaster | ||||||||
Business Acquisition [Line Items] | ||||||||
Goodwill | $ 26,836,000 | |||||||
Goodwill, expected tax deductible amount | 0 | |||||||
Intangible assets other than goodwill acquired | 28,060,000 | |||||||
Intangible assets other than goodwill, expected tax deductible amount | 0 | |||||||
Revenue from the date of acquisition | 9,038,000 | |||||||
Operating income (loss) from date of acquisition | (641,000) | |||||||
Amortization expense | 2,042,000 | |||||||
Acquisition related costs | 782,000 | |||||||
Payments to acquire businesses, net of cash acquired | $ 53,747,000 | |||||||
Other | ||||||||
Business Acquisition [Line Items] | ||||||||
Goodwill | 27,951,000 | $ 27,951,000 | $ 27,951,000 | $ 27,951,000 | ||||
Other | Industrial Processing | India | ||||||||
Business Acquisition [Line Items] | ||||||||
Consideration transferred | $ 2,882,000 |
Acquisitions - 2021 Acquisiti_2
Acquisitions - 2021 Acquisition Purchase Price Allocation (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Oct. 02, 2021 | Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | Aug. 23, 2021 | |
Net Assets Acquired: | |||||
Goodwill | $ 396,887 | $ 351,753 | $ 336,032 | ||
Purchase Price: | |||||
Cash Paid | $ 152,661 | $ 7,565 | $ 179,693 | ||
Weighted average useful life of acquired intangible assets | 13 years | ||||
2021 Acquisitions | |||||
Net Assets Acquired: | |||||
Cash and Cash Equivalents | $ 8,680 | ||||
Accounts Receivable | 8,449 | ||||
Inventories | 18,747 | ||||
Property, Plant, and Equipment | 29,641 | ||||
Other Assets | 8,476 | ||||
Goodwill | 53,757 | ||||
Total assets acquired | 190,977 | ||||
Short-term Obligations and Current Maturities of Long-term Obligations | 1,393 | ||||
Accounts Payable | 2,084 | ||||
Long-Term Deferred Income Taxes | 16,163 | ||||
Long-Term Obligations | 4,244 | ||||
Other Liabilities | 14,557 | ||||
Total liabilities assumed | 38,441 | ||||
Net assets acquired | 152,536 | ||||
Purchase Price: | |||||
Cash Paid | 152,536 | ||||
2021 Acquisitions | Tradenames | |||||
Net Assets Acquired: | |||||
Indefinite-Lived Intangible Assets | 4,959 | ||||
2021 Acquisitions | Customer relationships | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | 43,292 | ||||
2021 Acquisitions | Product technology | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | 11,615 | ||||
2021 Acquisitions | Tradenames | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | 1,400 | ||||
2021 Acquisitions | Other | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | $ 1,961 | ||||
Clouth | |||||
Net Assets Acquired: | |||||
Cash and Cash Equivalents | $ 4,923 | ||||
Accounts Receivable | 6,808 | ||||
Inventories | 14,119 | ||||
Property, Plant, and Equipment | 24,498 | ||||
Other Assets | 5,309 | ||||
Goodwill | 25,806 | ||||
Total assets acquired | 115,930 | ||||
Short-term Obligations and Current Maturities of Long-term Obligations | 1,393 | ||||
Accounts Payable | 1,287 | ||||
Long-Term Deferred Income Taxes | 9,465 | ||||
Long-Term Obligations | 4,244 | ||||
Other Liabilities | 7,391 | ||||
Total liabilities assumed | 23,780 | ||||
Net assets acquired | 92,150 | ||||
Purchase Price: | |||||
Cash Paid | 92,150 | ||||
Weighted average useful life of acquired intangible assets | 19 years | ||||
Clouth | Tradenames | |||||
Net Assets Acquired: | |||||
Indefinite-Lived Intangible Assets | 4,959 | ||||
Clouth | Customer relationships | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | 20,192 | ||||
Purchase Price: | |||||
Weighted average useful life of acquired intangible assets | 24 years | ||||
Clouth | Product technology | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | 8,915 | ||||
Purchase Price: | |||||
Weighted average useful life of acquired intangible assets | 10 years | ||||
Clouth | Tradenames | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | 0 | ||||
Clouth | Other | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | $ 401 | ||||
Other | |||||
Net Assets Acquired: | |||||
Cash and Cash Equivalents | $ 3,757 | ||||
Accounts Receivable | 1,641 | ||||
Inventories | 4,628 | ||||
Property, Plant, and Equipment | 5,143 | ||||
Other Assets | 3,167 | ||||
Goodwill | 27,951 | ||||
Total assets acquired | 75,047 | ||||
Short-term Obligations and Current Maturities of Long-term Obligations | 0 | ||||
Accounts Payable | 797 | ||||
Long-Term Deferred Income Taxes | 6,698 | ||||
Long-Term Obligations | 0 | ||||
Other Liabilities | 7,166 | ||||
Total liabilities assumed | 14,661 | ||||
Net assets acquired | 60,386 | ||||
Purchase Price: | |||||
Cash Paid | $ 60,386 | ||||
Weighted average useful life of acquired intangible assets | 16 years | ||||
Other | Tradenames | |||||
Net Assets Acquired: | |||||
Indefinite-Lived Intangible Assets | $ 0 | ||||
Other | Customer relationships | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | $ 23,100 | ||||
Purchase Price: | |||||
Weighted average useful life of acquired intangible assets | 17 years | ||||
Other | Product technology | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | $ 2,700 | ||||
Purchase Price: | |||||
Weighted average useful life of acquired intangible assets | 13 years | ||||
Other | Tradenames | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | $ 1,400 | ||||
Purchase Price: | |||||
Weighted average useful life of acquired intangible assets | 16 years | ||||
Other | Other | |||||
Net Assets Acquired: | |||||
Definite-Lived Intangible Assets | $ 1,560 | ||||
Balemaster | |||||
Net Assets Acquired: | |||||
Goodwill | $ 26,836 |
Acquisitions - 2021 Acquisiti_3
Acquisitions - 2021 Acquisition Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Earnings per Share Attributable to Kadant | |||
Cost of revenue | $ 449,214 | $ 357,722 | $ 410,884 |
Selling, general, and administrative expenses | 208,787 | 181,905 | $ 192,525 |
Clouth | |||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | |||
Revenue | 812,016 | 682,248 | |
Net Income Attributable to Kadant | $ 90,184 | $ 55,760 | |
Earnings per Share Attributable to Kadant | |||
Basic (in dollars per share) | $ 7.79 | $ 4.86 | |
Diluted (in dollars per share) | $ 7.74 | $ 4.82 | |
Clouth | Inventory revalued | |||
Earnings per Share Attributable to Kadant | |||
Cost of revenue | $ 3,082 | $ 3,082 | |
Clouth | Acquisition-related Costs | |||
Earnings per Share Attributable to Kadant | |||
Selling, general, and administrative expenses | 2,710 | 3,109 | |
Amortization | $ 399 | ||
Clouth | Forgiveness Of Shareholder Loan | |||
Earnings per Share Attributable to Kadant | |||
Pre-tax gain from loan forgiveness | $ 4,409 |
Acquisitions - 2019 and 2020 Ac
Acquisitions - 2019 and 2020 Acquisition Additional Information (Details) - USD ($) $ in Thousands | Jun. 01, 2020 | May 28, 2020 | Sep. 03, 2019 | Jan. 02, 2019 | Apr. 03, 2021 | Jun. 27, 2020 | Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 |
Business Acquisition [Line Items] | |||||||||
Payments to acquire businesses, net of cash acquired | $ 143,981 | $ 7,095 | $ 177,798 | ||||||
Goodwill | 396,887 | 351,753 | 336,032 | ||||||
Acquisition related costs | 3,655 | 485 | 843 | ||||||
Flow Control | |||||||||
Business Acquisition [Line Items] | |||||||||
Payments to acquire productive assets | $ 407 | ||||||||
Acquisition related costs | 6,191 | ||||||||
Material Handling | |||||||||
Business Acquisition [Line Items] | |||||||||
Acquisition related costs | $ 2,851 | $ 350 | 5,715 | ||||||
Cogent Industrial Technologies | Customer relationships | |||||||||
Business Acquisition [Line Items] | |||||||||
Finite-lived intangible assets acquired | $ 3,350 | ||||||||
Cogent Industrial Technologies | Industrial Processing | |||||||||
Business Acquisition [Line Items] | |||||||||
Payments to acquire businesses, net of cash acquired | $ 6,866 | ||||||||
Company in Austria | Product technology | |||||||||
Business Acquisition [Line Items] | |||||||||
Finite-lived intangible assets acquired | $ 557 | ||||||||
Company in Austria | Industrial Processing | Product technology | |||||||||
Business Acquisition [Line Items] | |||||||||
Payments to acquire businesses, net of cash acquired | $ 125 | $ 229 | |||||||
Consideration transferred | $ 416 | ||||||||
Syntron Material Handling Group, LLC | |||||||||
Business Acquisition [Line Items] | |||||||||
Goodwill | $ 78,592 | ||||||||
Goodwill, expected tax deductible amount | $ 59,195 | ||||||||
Deductible for tax purposes, period | 15 years | ||||||||
Intangible assets other than goodwill acquired | $ 83,020 | ||||||||
Intangible assets other than goodwill, expected tax deductible amount | $ 69,969 | ||||||||
Acquired intangible assets other than goodwill income tax deductibility, period (years) | 15 years | ||||||||
Revenue from the date of acquisition | 83,364 | ||||||||
Operating income (loss) from date of acquisition | 3,132 | ||||||||
Amortization expense | 4,872 | ||||||||
Acquisition related costs | $ 843 | ||||||||
Syntron Material Handling Group, LLC | Material Handling | |||||||||
Business Acquisition [Line Items] | |||||||||
Payments to acquire businesses, net of cash acquired | $ 176,855 |
Acquisitions - 2019 and 2020 _2
Acquisitions - 2019 and 2020 Acquisition Purchase Price Allocation (Details) - USD ($) $ in Thousands | Jan. 02, 2019 | Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 |
Net Assets Acquired: | ||||
Goodwill | $ 396,887 | $ 351,753 | $ 336,032 | |
Purchase Price: | ||||
Weighted average useful life of acquired intangible assets | 13 years | |||
Syntron Material Handling Group, LLC | ||||
Net Assets Acquired: | ||||
Cash, cash equivalents and restricted cash | $ 2,431 | |||
Accounts Receivable | 10,275 | |||
Inventories | 13,061 | |||
Property, Plant, and Equipment | 7,383 | |||
Other Assets | 12,054 | |||
Goodwill | 78,592 | |||
Total assets acquired | 206,816 | |||
Accounts Payable | 3,380 | |||
Other Current Liabilities | 7,954 | |||
Long-Term Lease Liabilities | 15,244 | |||
Long-Term Deferred Income Taxes | 952 | |||
Total liabilities assumed | 27,530 | |||
Net assets acquired | 179,286 | |||
Purchase Price: | ||||
Cash Paid | $ 179,286 | |||
Weighted average useful life of acquired intangible assets | 14 years | |||
Syntron Material Handling Group, LLC | Tradenames | ||||
Net Assets Acquired: | ||||
Indefinite-Lived Intangible Assets | $ 9,500 | |||
Syntron Material Handling Group, LLC | Customer relationships | ||||
Net Assets Acquired: | ||||
Definite-Lived Intangible Assets | $ 58,300 | |||
Purchase Price: | ||||
Weighted average useful life of acquired intangible assets | 15 years | |||
Syntron Material Handling Group, LLC | Product technology | ||||
Net Assets Acquired: | ||||
Definite-Lived Intangible Assets | $ 11,000 | |||
Purchase Price: | ||||
Weighted average useful life of acquired intangible assets | 14 years | |||
Syntron Material Handling Group, LLC | Other | ||||
Net Assets Acquired: | ||||
Definite-Lived Intangible Assets | $ 4,220 | |||
Purchase Price: | ||||
Weighted average useful life of acquired intangible assets | 8 years |
Acquisitions - 2019 and 2020 _3
Acquisitions - 2019 and 2020 Acquisition Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Earnings per Share Attributable to Kadant | |||
Selling, general, and administrative expenses | $ 208,787 | $ 181,905 | $ 192,525 |
Cost of revenue | $ 449,214 | $ 357,722 | 410,884 |
Syntron Material Handling Group, LLC | |||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | |||
Revenue | 704,644 | ||
Net Income Attributable to Kadant | $ 56,409 | ||
Earnings per Share Attributable to Kadant | |||
Basic (in dollars per share) | $ 5.02 | ||
Diluted (in dollars per share) | $ 4.92 | ||
Syntron Material Handling Group, LLC | Acquisition-related Costs | |||
Earnings per Share Attributable to Kadant | |||
Selling, general, and administrative expenses | $ 843 | ||
Syntron Material Handling Group, LLC | Inventory revalued | |||
Earnings per Share Attributable to Kadant | |||
Cost of revenue | 3,549 | ||
Syntron Material Handling Group, LLC | Intangible amortization related to acquired backlog | |||
Earnings per Share Attributable to Kadant | |||
Amortization | $ 1,323 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jul. 31, 2020 | Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Number of shares available for grant (in shares) | 336,157 | |||
Cost recognized, defined contribution plan | $ 4,706 | $ 4,501 | $ 4,412 | |
Defined benefit plan, loss due to settlement | 5,887 | |||
Defined benefit plan, interest costs | 1,334 | |||
Defined benefit plan, expected return on plan assets | $ 995 | |||
Defined benefit plan, discount rate (percent) | 4.10% | |||
Defined benefit plan, expected return on plan assets (percent) | 4.10% | |||
Restricted stock units for non employee directors (RSUs) | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Granted (in shares) | 1,042 | 1,009 | 2,085 | 1,858 |
Performance-based restricted stock units | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Shares received upon vesting (in shares) | 1 | |||
Vesting period (years) | 3 years | |||
Compensation cost not yet recognized | $ 3,231 | |||
Compensation cost not yet recognized, recognition period | 1 year 4 months 24 days | |||
Time-based restricted stock units | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Shares received upon vesting (in shares) | 1 | |||
Compensation cost not yet recognized | $ 3,932 | |||
Compensation cost not yet recognized, recognition period | 1 year 9 months 18 days | |||
Restricted stock unit awards | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Granted (in shares) | 49,000 | |||
Weighted average grant date fair value, granted (in dollars per share) | $ 174.52 | $ 88.22 | $ 86.50 | |
Fair value of awards vested in period | $ 5,892 | $ 7,343 | $ 5,452 | |
Stock option awards | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Vesting period (years) | 3 years | |||
Options outstanding (in shares) | 0 | 27,000 | ||
Employee stock purchase plan awards | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Number of shares available for grant (in shares) | 91,643 | |||
Discount to market under the ESOP | 15.00% | |||
Maximum period of restriction on resale under ESOP | 1 year | |||
Maximum participation based on compensation percentage under ESOP | 10.00% | |||
Stock issued during period under ESOP (in shares) | 10,230 | 13,062 | 13,195 | |
Restoration Plan | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Settlement payment | $ 2,427 | |||
Director | Restricted stock units for non employee directors (RSUs) | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Shares received upon vesting (in shares) | 1 |
Employee Benefit Plans - Compon
Employee Benefit Plans - Components Stock-Based Compensation Expense (Details) - Selling, general and administrative expenses - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 8,527 | $ 6,776 | $ 6,815 |
RSU Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | 8,224 | 6,453 | 6,616 |
Employee Stock Purchase Plan Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 303 | $ 323 | $ 199 |
Employee Benefit Plans - Activi
Employee Benefit Plans - Activity of the Unvested RSUs (Details) - RSU Awards - $ / shares shares in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Units | |||
Unvested RSUs at beginning of year (in shares) | 120 | ||
Granted (in shares) | 49 | ||
Vested (in shares) | (61) | ||
Forfeited (in shares) | (1) | ||
Unvested RSU's at end of year (in shares) | 107 | 120 | |
Weighted Average Grant- Date Fair Value | |||
Weighted average grant date fair value, balance at beginning of year (in dollars per share) | $ 92.42 | ||
Weighted average grant date fair value, granted (in dollars per share) | 174.52 | $ 88.22 | $ 86.50 |
Weighted average grant date fair value, vested (in dollars per share) | 96.96 | ||
Weighted average grant date fair value, forfeited (in dollars per share) | 91.71 | ||
Weighted average grant date fair value, balance at end of year (in dollars per share) | $ 127.70 | $ 92.42 |
Employee Benefit Plans - Stock
Employee Benefit Plans - Stock Option Activity (Details) - Stock Option Awards | 12 Months Ended |
Jan. 01, 2022$ / sharesshares | |
Number of Shares | |
Options outstanding, beginning balance (in shares) | shares | 27,000 |
Exercised (in shares) | shares | (27,000) |
Options outstanding, ending balance (in shares) | shares | 0 |
Weighted Average Exercise Price | |
Options outstanding, beginning balance (in dollars per share) | $ / shares | $ 24.44 |
Exercised (in dollars per share) | $ / shares | 24.44 |
Options outstanding, ending balance (in dollars per share) | $ / shares | $ 0 |
Employee Benefit Plans - Stoc_2
Employee Benefit Plans - Stock Option Exercises (Details) - Stock Option Awards - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total Intrinsic Value of Options Exercised | $ 4,986 | $ 4,071 | $ 16,796 |
Cash Received from Options Exercised | $ 665 | $ 1,123 | $ 4,454 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - $ / shares | Jan. 01, 2022 | Jan. 02, 2021 |
Preferred Stock [Abstract] | ||
Preferred stock, authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common Stock [Abstract] | ||
Common stock reserved and unissued (in shares) | 534,535 |
Income Taxes - Components of In
Income Taxes - Components of Income Before Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ 26,599 | $ 14,132 | $ 93 |
Foreign | 85,453 | 59,555 | 68,829 |
Income Before Provision for Income Taxes | $ 112,052 | $ 73,687 | $ 68,922 |
Income Taxes - Components of Pr
Income Taxes - Components of Provision for Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Current Provision (Benefit): | |||
Federal | $ 2,173 | $ 339 | $ (264) |
Foreign | 25,512 | 16,800 | 18,778 |
State | 870 | 667 | 335 |
Current provision | 28,555 | 17,806 | 18,849 |
Deferred Provision (Benefit): | |||
Federal | 1,823 | 2,146 | (453) |
Foreign | (3,430) | (2,361) | (1,253) |
State | 223 | 357 | (785) |
Deferred (benefit) provision | (1,384) | 142 | (2,491) |
Total income tax provision | $ 27,171 | $ 17,948 | $ 16,358 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Income Tax Disclosure [Abstract] | |||
Excess tax benefit related to share-based compensation | $ 1,808 | $ 758 | $ 3,754 |
Operating Loss Carryforwards [Line Items] | |||
Deferred tax assets, valuation allowance | 9,212 | 9,609 | |
Increase (decrease) of deferred tax asset valuation allowance | 397 | ||
Foreign tax credits | 368 | ||
Undistributed earnings of foreign subsidiaries | 245,079 | ||
Foreign earnings repatriated | 116,853 | ||
Foreign currency transaction gain | 517 | ||
Portion of foreign earnings repatriated for distribution of shares of foreign subsidiary | 100,765 | ||
Provision for unremitted foreign earnings | 570 | ||
Undistributed earnings of foreign subsidiaries excluding those repatriated back domestically | 223,035 | ||
Estimated withholding liability related to undistributed earnings of foreign subsidiaries | 4,116 | ||
Unrecognized tax benefits that would impact effective tax rate | 9,731 | ||
Income tax penalties and accrued interest from unrecognized tax benefits | 1,704 | 1,600 | |
Income tax penalties and interest expense from unrecognized tax benefits | 129 | $ 145 | |
Estimated amount of liability for unrecognized tax benefit to be reduced next year | 1,367 | ||
Internal revenue service (IRS) | |||
Operating Loss Carryforwards [Line Items] | |||
Deferred tax assets, valuation allowance | 190 | ||
Domestic tax authority | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 2,304 | ||
Interest carryforward | 67 | ||
Foreign tax authority | |||
Operating Loss Carryforwards [Line Items] | |||
Deferred tax assets, valuation allowance | 9,022 | ||
Operating loss carryforwards | 56,537 | ||
Operating loss carryforwards, subject to expiration | 1,499 | ||
State and local jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 30,830 | ||
Syntron Material Handling Group, LLC | |||
Operating Loss Carryforwards [Line Items] | |||
Foreign tax credits | $ 120 |
Income Taxes - Reconciliation (
Income Taxes - Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Income Tax Disclosure [Abstract] | |||
Provision for Income Taxes at Statutory Rate | $ 23,531 | $ 15,474 | $ 14,474 |
Increases (Decreases) Resulting From: | |||
Foreign tax rate differential | 2,819 | 1,891 | 2,584 |
Nondeductible expenses | 1,673 | 2,117 | 2,407 |
Excess tax benefit related to stock-based compensation | (1,525) | (661) | (3,305) |
State income taxes, net of federal income tax | 863 | 807 | (355) |
U.S. tax cost of foreign earnings | 481 | 599 | 146 |
Reversal of tax benefit reserves, net | (444) | (730) | (286) |
Research and development tax credits | (454) | (465) | (381) |
Change in valuation allowance | (31) | (469) | 81 |
Other | 258 | (615) | 993 |
Total income tax provision | $ 27,171 | $ 17,948 | $ 16,358 |
Income Taxes - Net Deferred Tax
Income Taxes - Net Deferred Tax Liability (Details) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Deferred Tax Asset: | ||
Net operating loss carryforwards | $ 14,162 | $ 13,719 |
Lease liabilities | 6,393 | 6,855 |
Inventory basis difference | 4,600 | 4,576 |
Employee compensation | 4,368 | 3,189 |
Reserves and accruals | 3,167 | 3,565 |
Capitalized research expenses | 2,349 | 2,668 |
Foreign, state, and alternative minimum tax credit carryforwards | 508 | 472 |
Allowance for credit losses | 420 | 397 |
Other | 48 | 213 |
Deferred tax asset, gross | 36,015 | 35,654 |
Less: valuation allowance | (9,212) | (9,609) |
Deferred tax asset, net | 26,803 | 26,045 |
Deferred Tax Liability: | ||
Goodwill and intangible assets | (43,780) | (30,166) |
Fixed asset basis difference | (6,009) | (4,964) |
ROU assets | (5,431) | (5,812) |
Provision for unremitted foreign earnings | (559) | (1,233) |
Other | (1,819) | (1,574) |
Deferred tax liability | (57,598) | (43,749) |
Net deferred tax liability | $ (30,795) | $ (17,704) |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Reconciliation of Unrecognized Tax Benefits [Roll Forward] | ||
Unrecognized Tax Benefits, Beginning of Year | $ 8,337 | $ 8,331 |
Gross Increases—Tax Positions in Prior Periods | 2,409 | 4 |
Gross Decreases—Tax Positions in Prior Periods | (2,182) | (21) |
Gross Increases—Current-period Tax Positions | 1,920 | 1,468 |
Lapses of Statutes of Limitations | (649) | (1,488) |
Currency Translation | (104) | |
Currency Translation | 43 | |
Unrecognized Tax Benefits, End of Year | $ 9,731 | $ 8,337 |
Short- and Long-Term Obligati_3
Short- and Long-Term Obligations - Short- and Long-term Obligations (Details) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 264,607 | |
Finance Leases, due 2022 to 2026 | 1,610 | $ 1,631 |
Total | 269,514 | 233,474 |
Less: Short-Term Obligations and Current Maturities of Long-Term Obligations | (5,356) | (1,474) |
Long-Term Obligations | 264,158 | 232,000 |
Revolving Credit Facility, due 2023 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 250,267 | 217,963 |
Senior Promissory Notes, due 2023 to 2028 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 10,000 | 10,000 |
Other Borrowings, due 2022 to 2028 | ||
Debt Instrument [Line Items] | ||
Other Borrowings, due 2022 to 2028 | $ 7,637 | $ 3,880 |
Short- and Long-Term Obligati_4
Short- and Long-Term Obligations - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Debt Instrument [Line Items] | |||
Proceeds from issuance of long-term obligations | $ 151,944,000 | $ 26,000,000 | $ 247,196,000 |
Short-and long-term debt, excluding finance leases | 264,607,000 | ||
Loans receivable | 1,408,000 | ||
Clouth | |||
Debt Instrument [Line Items] | |||
Short-and long-term debt, excluding finance leases | 4,331,000 | ||
Sale Leaseback Arrangement | |||
Debt Instrument [Line Items] | |||
Sale leaseback transaction outstanding amount | $ 3,297,000 | ||
Maximum | Clouth | |||
Debt Instrument [Line Items] | |||
Effective interest rate | 1.95% | ||
Revolving credit facility | |||
Debt Instrument [Line Items] | |||
Short-and long-term debt, excluding finance leases | $ 250,267,000 | 217,963,000 | |
Remaining borrowing capacity | $ 149,920,000 | ||
Weighted average interest rate for long-term obligations | 1.50% | ||
Revolving credit facility | 2017 Credit Agreement | |||
Debt Instrument [Line Items] | |||
Borrowing capacity available under committed portion | $ 400,000,000 | ||
Uncommitted unsecured additional borrowing capacity | 150,000,000 | ||
Maximum amount of unrestricted U.S. cash | $ 30,000,000 | ||
Maximum consolidated leverage ratio | 3.75 | ||
Minimum consolidated interest coverage ratio | 4 | ||
Proceeds from issuance of long-term obligations | $ 151,944,000 | ||
Revolving credit facility | Euro-Denominated Borrowing | |||
Debt Instrument [Line Items] | |||
Proceeds from issuance of long-term obligations | 89,944,000 | ||
Short-and long-term debt, excluding finance leases | $ 78,267,000 | ||
Revolving credit facility | Base Rate | Minimum | 2017 Credit Agreement | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate (as a percentage) | 0.00% | ||
Revolving credit facility | Base Rate | Maximum | 2017 Credit Agreement | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate (as a percentage) | 1.25% | ||
Revolving credit facility | Eurocurrency Rate, CDOR Rate and RFR | 2017 Credit Agreement | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate floor (as a percentage) | 0.00% | ||
Revolving credit facility | Eurocurrency Rate, CDOR Rate and RFR | Minimum | 2017 Credit Agreement | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate (as a percentage) | 1.00% | ||
Revolving credit facility | Eurocurrency Rate, CDOR Rate and RFR | Maximum | 2017 Credit Agreement | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate (as a percentage) | 2.25% | ||
Senior promissory notes | |||
Debt Instrument [Line Items] | |||
Short-and long-term debt, excluding finance leases | $ 10,000,000 | $ 10,000,000 | |
Senior promissory notes | Note Purchase Agreement | |||
Debt Instrument [Line Items] | |||
Principal amount | $ 10,000,000 | ||
Fixed interest rate | 4.90% | ||
Other | Sale Leaseback Arrangement | |||
Debt Instrument [Line Items] | |||
Effective interest rate | 1.79% | ||
Net purchase option | $ 1,508,000 |
Short- and Long-Term Obligati_5
Short- and Long-Term Obligations - Future Repayments of Debt (Details) $ in Thousands | Jan. 01, 2022USD ($) |
Debt Disclosure [Abstract] | |
2022 | $ 1,197 |
2023 | 252,855 |
2024 | 2,319 |
2025 | 2,322 |
2026 | 2,150 |
2027 and Thereafter | 3,764 |
Long-term obligations excluding finance leases and sales-leaseback arrangement | $ 264,607 |
Commitments and Contingencies -
Commitments and Contingencies - Letters of Credit and Bank Guarantees (Details) $ in Thousands | Jan. 01, 2022USD ($) |
Performance Obligations and Customer Deposit Guarantees | |
Line of Credit Facility [Line Items] | |
Outstanding letters of credit and bank guarantees | $ 23,464 |
Commitments and Contingencies_2
Commitments and Contingencies - Right of Recourse (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Maturity period for bank acceptance (in months) | 6 months | |
Banker's acceptances drafts | $ 9,593 | $ 7,568 |
Other Costs, Net - Additional I
Other Costs, Net - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022USD ($)employee | Jan. 02, 2021USD ($)employee | Dec. 28, 2019USD ($)employee | |
2021 Restructuring Plan | Employee severance | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance costs | $ 176 | ||
2020 Restructuring Plan | Employee severance | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance costs | $ 1,118 | ||
2019 Restructuring Plan | Canada | |||
Restructuring Cost and Reserve [Line Items] | |||
Number of positions eliminated related to restructuring | employee | 6 | ||
2019 Restructuring Plan | Employee severance | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance costs | $ 192 | ||
Flow Control | |||
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring cost | 980 | ||
Flow Control | 2021 Restructuring Plan | |||
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring cost | 481 | ||
Impairment charges of ROU asset | 79 | ||
Severance costs | $ 176 | ||
Number of positions eliminated related to restructuring | employee | 3 | ||
Flow Control | 2021 Restructuring Plan | Machinery and Equipment | |||
Restructuring Cost and Reserve [Line Items] | |||
Impairment charge of machinery and equipment | $ 226 | ||
Flow Control | 2020 Restructuring Plan | Employee severance | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance costs | $ 659 | ||
Number of positions eliminated related to restructuring | employee | 34 | ||
Industrial Processing | |||
Restructuring Cost and Reserve [Line Items] | |||
Impairment charge of machinery and equipment | $ 1,861 | $ 2,336 | |
Pre-tax gain on sale of real estate | 515 | ||
Cash proceeds from sale of real estate | $ 1,634 | ||
Industrial Processing | 2020 Restructuring Plan | |||
Restructuring Cost and Reserve [Line Items] | |||
Number of positions eliminated related to restructuring | employee | 21 | ||
Industrial Processing | 2020 Restructuring Plan | Employee severance | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance costs | $ 277 | ||
Number of positions eliminated related to restructuring | employee | 26 | ||
Material Handling | 2020 Restructuring Plan | Employee severance | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance costs | $ 182 | ||
Number of positions eliminated related to restructuring | employee | 4 |
Other Costs, Net - Changes in A
Other Costs, Net - Changes in Accrued Restructuring (Details) - Severance - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
2021 Restructuring Plan | |||
Restructuring Reserve [Roll Forward] | |||
Provision | $ 176 | ||
Usage | (19) | ||
Currency translation | (1) | ||
Balance at end of period | 156 | ||
2020 Restructuring Plan | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | 61 | ||
Provision | $ 1,118 | ||
Usage | (61) | (1,052) | |
Currency translation | (5) | ||
Balance at end of period | 0 | 61 | |
2019 Restructuring Plan | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | $ 0 | 84 | |
Provision | $ 192 | ||
Usage | (90) | (109) | |
Currency translation | 6 | 1 | |
Balance at end of period | $ 0 | $ 84 |
Leases - Additional Information
Leases - Additional Information (Details) | 12 Months Ended |
Jan. 01, 2022 | |
Lessee, Lease, Description [Line Items] | |
Lease, remaining term | 13 years |
Lease, option to extend, term | 5 years |
China and Canada | |
Lessee, Lease, Description [Line Items] | |
Lease, option to extend, term | 10 years |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Leases [Abstract] | |||
Operating Lease Cost | $ 5,895 | $ 5,602 | $ 5,534 |
Short-Term Lease Cost | 674 | 671 | 715 |
Finance Lease Cost: | |||
ROU asset amortization | 1,045 | 1,157 | 1,213 |
Interest on lease liabilities | 46 | 74 | 94 |
Total Finance Lease Cost | 1,091 | 1,231 | 1,307 |
Total Lease Costs | $ 7,660 | $ 7,504 | $ 7,556 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information Related to Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Cash Paid for Amounts Included in the Measurement of Lease Liabilities: | |||
Operating cash flows from operating leases | $ 12,474 | $ 5,782 | $ 5,636 |
Operating cash flows from finance leases | 46 | 74 | 93 |
Financing cash flows from finance leases | 1,044 | 1,139 | 1,144 |
Right of Use Assets Obtained in Exchange for Lease Obligations | |||
Right-of-use asset obtained in exchange for operating lease liability | 7,247 | 2,560 | 28,484 |
Right-of-use asset obtained in exchange for finance lease liability | $ 1,147 | $ 622 | $ 3,847 |
Leases - Supplemental Cash Fl_2
Leases - Supplemental Cash Flow Information Related to Leases Footnote (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Lessee, Lease, Description [Line Items] | |||
Right-of-use asset obtained in exchange for operating lease liability | $ 7,247 | $ 2,560 | $ 28,484 |
Right-of-use asset obtained in exchange for finance lease liability | $ 1,147 | $ 622 | 3,847 |
Accounting Standards Update 2016-02 | |||
Lessee, Lease, Description [Line Items] | |||
Right-of-use asset obtained in exchange for operating lease liability | 13,167 | ||
Right-of-use asset obtained in exchange for finance lease liability | 2,496 | ||
Syntron Material Handling Group, LLC | Accounting Standards Update 2016-02 | |||
Lessee, Lease, Description [Line Items] | |||
Right-of-use asset obtained in exchange for operating lease liability | 10,994 | ||
Right-of-use asset obtained in exchange for finance lease liability | $ 528 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information Related to Leases (Details) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Operating Leases: | ||
ROU assets, current | $ 2,341 | $ 0 |
ROU assets, noncurrent | 24,998 | 25,460 |
Total operating lease assets | 27,339 | 25,460 |
Short-term liabilities | 4,596 | 4,396 |
Long-term liabilities | 19,959 | 22,198 |
Total operating lease liabilities | 24,555 | 26,594 |
Finance Leases: | ||
ROU assets, at cost | 4,076 | 3,707 |
ROU assets accumulated amortization | $ (2,489) | $ (2,108) |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, Plant, and Equipment, Net | Property, Plant, and Equipment, Net |
ROU assets, net | $ 1,587 | $ 1,599 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Short-term obligations and current maturities of long-term obligations (Note 6) | Short-term obligations and current maturities of long-term obligations (Note 6) |
Short-term obligations | $ 862 | $ 915 |
Long-term obligations | 748 | 716 |
Total finance lease liabilities | $ 1,610 | $ 1,631 |
Weighted Average Remaining Lease Term (in years): | ||
Operating lease, weighted average remaining lease term (years) | 8 years 8 months 12 days | 9 years 4 months 24 days |
Finance lease, weighted average remaining lease term (years) | 2 years 1 month 6 days | 2 years |
Weighted Average Discount Rate: | ||
Operating lease, weighted average discount rate (percent) | 3.82% | 3.88% |
Finance lease, weighted average discount rate (percent) | 2.55% | 3.52% |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other current assets, Other Assets, Noncurrent | Other current assets, Other Assets, Noncurrent |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other current liabilities | Other current liabilities |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other Long-Term Liabilities | Other Long-Term Liabilities |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Long-Term Obligations (Note 6) | Long-Term Obligations (Note 6) |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Operating | ||
2022 | $ 5,379 | |
2023 | 4,316 | |
2024 | 3,292 | |
2025 | 2,727 | |
2026 | 2,179 | |
2027 and Thereafter | 11,343 | |
Total Future Lease Payments | 29,236 | |
Less: Imputed Interest | (4,681) | |
Present Value of Lease Payments | 24,555 | $ 26,594 |
Finance | ||
2022 | 889 | |
2023 | 561 | |
2024 | 178 | |
2025 | 17 | |
2026 | 3 | |
2027 and Thereafter | 0 | |
Total Future Lease Payments | 1,648 | |
Less: Imputed Interest | (38) | |
Total finance lease liabilities | $ 1,610 | $ 1,631 |
Derivatives - Additional Inform
Derivatives - Additional Information (Details) | 12 Months Ended | |
Jan. 01, 2022USD ($) | Dec. 29, 2018USD ($) | |
Derivatives, Fair Value [Line Items] | ||
Cash flow hedge loss to be reclassified within twelve months | $ 337,000 | |
Cash Flow Hedging | Derivatives Designated as Hedging Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Rate of effectiveness of derivative agreement | 100.00% | |
Cash Flow Hedging | 2018 Swap Agreement | Derivatives Designated as Hedging Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount | $ 15,000,000 | |
Derivative, floor rate | 0 | |
Derivative, fixed interest rate | 3.15% | |
Cash Flow Hedging | Forward Currency- Exchange Contracts | Derivatives Designated as Hedging Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Period over which entity manages its level of exposure of risk | 12 months |
Derivatives - Fair Value (Detai
Derivatives - Fair Value (Details) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Derivatives Designated as Hedging Instruments | Forward Currency- Exchange Contracts | Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | $ 0 | $ 25 |
Derivative asset, notional amount | 0 | 842 |
Derivatives Designated as Hedging Instruments | Forward Currency- Exchange Contracts | Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability, fair value, gross liability | (44) | 0 |
Derivative liability, notional amount | 842 | 0 |
Derivatives Designated as Hedging Instruments | 2018 Swap Agreement | Other Long-Term Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability, fair value, gross liability | (550) | (1,099) |
Derivative liability, notional amount | 15,000 | 15,000 |
Derivatives Not Designated as Hedging Instruments | Forward Currency- Exchange Contracts | Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 14 | 12 |
Derivative asset, notional amount | 1,200 | 582 |
Derivatives Not Designated as Hedging Instruments | Forward Currency- Exchange Contracts | Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability, fair value, gross liability | 0 | (7) |
Derivative liability, notional amount | $ 0 | $ 825 |
Derivatives - AOCI Activity (De
Derivatives - AOCI Activity (Details) $ in Thousands | 12 Months Ended |
Jan. 01, 2022USD ($) | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Beginning balance | $ 496,905 |
Ending balance | 565,616 |
Deferred Loss on Cash Flow Hedges | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Beginning balance | (828) |
Loss (gain) reclassified to earnings | 224 |
Gain recognized in AOCI | 142 |
Ending balance | (462) |
Deferred Loss on Cash Flow Hedges | Interest Rate Swap Agreements | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Beginning balance | (846) |
Loss (gain) reclassified to earnings | 343 |
Gain recognized in AOCI | 74 |
Ending balance | (429) |
Deferred Loss on Cash Flow Hedges | Forward Currency- Exchange Contracts | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Beginning balance | 18 |
Loss (gain) reclassified to earnings | (119) |
Gain recognized in AOCI | 68 |
Ending balance | $ (33) |
Fair Value Measurements and F_3
Fair Value Measurements and Fair Value of Financial Instruments - Assets and Liabilities, Recurring Basis (Details) - Recurring - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Assets: | ||
Money market funds and time deposits | $ 13,458 | $ 8,054 |
Banker's acceptance drafts | 8,049 | 9,445 |
Forward currency-exchange contracts | 14 | 37 |
Liabilities: | ||
2018 Swap Agreement | 550 | 1,009 |
Forward currency-exchange contract | 44 | 7 |
Level 1 | ||
Assets: | ||
Money market funds and time deposits | 13,458 | 8,054 |
Banker's acceptance drafts | 0 | 0 |
Forward currency-exchange contracts | 0 | 0 |
Liabilities: | ||
2018 Swap Agreement | 0 | 0 |
Forward currency-exchange contract | 0 | 0 |
Level 2 | ||
Assets: | ||
Money market funds and time deposits | 0 | 0 |
Banker's acceptance drafts | 8,049 | 9,445 |
Forward currency-exchange contracts | 14 | 37 |
Liabilities: | ||
2018 Swap Agreement | 550 | 1,009 |
Forward currency-exchange contract | 44 | 7 |
Level 3 | ||
Assets: | ||
Money market funds and time deposits | 0 | 0 |
Banker's acceptance drafts | 0 | 0 |
Forward currency-exchange contracts | 0 | 0 |
Liabilities: | ||
2018 Swap Agreement | 0 | 0 |
Forward currency-exchange contract | $ 0 | $ 0 |
Fair Value Measurements and F_4
Fair Value Measurements and Fair Value of Financial Instruments - Debt Obligations (Details) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt obligations | $ 264,598 | $ 227,963 |
Carrying Value | Revolving credit facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt obligations | 250,267 | 217,963 |
Carrying Value | Senior promissory notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt obligations | 10,000 | 10,000 |
Carrying Value | Other | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt obligations | 4,331 | 0 |
Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt obligations | 265,545 | 229,120 |
Fair Value | Revolving credit facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt obligations | 250,267 | 217,963 |
Fair Value | Senior promissory notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt obligations | 10,947 | 11,157 |
Fair Value | Other | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt obligations | $ 4,331 | $ 0 |
Business Segment and Geograph_3
Business Segment and Geographical Information - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022USD ($)segment | Jan. 02, 2021USD ($) | Dec. 28, 2019USD ($) | |
Segment Reporting [Abstract] | |||
Number of reportable segments | segment | 3 | ||
Segment Reporting Information [Line Items] | |||
Acquisition related costs | $ 3,655 | $ 485 | $ 843 |
Settlement and curtailment losses | 0 | 119 | (3,826) |
Flow Control | |||
Segment Reporting Information [Line Items] | |||
Acquisition related costs | 6,191 | ||
Impairment and restructuring charges | 980 | ||
Industrial Processing | |||
Segment Reporting Information [Line Items] | |||
Impairment charges | 1,861 | 2,336 | |
Material Handling | |||
Segment Reporting Information [Line Items] | |||
Acquisition related costs | $ 2,851 | $ 350 | 5,715 |
Other expense, net | |||
Segment Reporting Information [Line Items] | |||
Settlement and curtailment losses | $ 5,887 |
Business Segment and Geograph_4
Business Segment and Geographical Information - Revenues and Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Revenue | |||
Revenue | $ 786,579 | $ 635,028 | $ 704,644 |
Income Before Provision for Income Taxes | |||
Total operating income | 116,710 | 81,124 | 87,823 |
Interest expense, net | (4,554) | (7,242) | (12,542) |
Other expense, net | (104) | (195) | (6,359) |
Income Before Provision for Income Taxes | 112,052 | 73,687 | 68,922 |
Total Assets | |||
Total assets | 1,132,212 | 927,571 | 939,387 |
Depreciation and Amortization | |||
Depreciation and amortization | 34,302 | 31,334 | 32,390 |
Capital Expenditures | |||
Capital expenditures | 12,771 | 7,595 | 9,957 |
Geographical Information | |||
Long-lived assets | 107,989 | 84,642 | 86,032 |
United States | |||
Revenue | |||
Revenue | 328,456 | 286,015 | 309,957 |
Geographical Information | |||
Long-lived assets | 43,418 | 40,293 | 42,094 |
China | |||
Revenue | |||
Revenue | 82,121 | 51,003 | 66,480 |
Geographical Information | |||
Long-lived assets | 6,613 | 9,844 | 10,319 |
Canada | |||
Revenue | |||
Revenue | 79,426 | 62,059 | 64,010 |
Geographical Information | |||
Long-lived assets | 8,460 | 7,221 | 7,948 |
Germany | |||
Revenue | |||
Revenue | 37,178 | 23,292 | 29,076 |
Geographical Information | |||
Long-lived assets | 25,188 | 6,051 | 5,925 |
France | |||
Revenue | |||
Revenue | 28,258 | 19,725 | 21,054 |
Other | |||
Revenue | |||
Revenue | 231,140 | 192,934 | 214,067 |
Geographical Information | |||
Long-lived assets | 16,963 | 13,220 | 12,786 |
Finland | |||
Geographical Information | |||
Long-lived assets | 7,347 | 8,013 | 6,960 |
Operating Segments | Flow Control | |||
Revenue | |||
Revenue | 288,788 | 225,444 | 250,339 |
Income Before Provision for Income Taxes | |||
Total operating income | 65,509 | 51,530 | 55,343 |
Total Assets | |||
Total assets | 382,379 | 263,141 | 262,320 |
Depreciation and Amortization | |||
Depreciation and amortization | 8,366 | 6,333 | 6,603 |
Capital Expenditures | |||
Capital expenditures | 4,128 | 2,808 | 2,639 |
Operating Segments | Industrial Processing | |||
Revenue | |||
Revenue | 328,762 | 261,577 | 301,948 |
Income Before Provision for Income Taxes | |||
Total operating income | 66,569 | 42,971 | 49,599 |
Total Assets | |||
Total assets | 405,575 | 379,965 | 375,194 |
Depreciation and Amortization | |||
Depreciation and amortization | 13,467 | 13,163 | 13,012 |
Capital Expenditures | |||
Capital expenditures | 6,412 | 3,123 | 5,113 |
Operating Segments | Material Handling | |||
Revenue | |||
Revenue | 169,029 | 148,007 | 152,357 |
Income Before Provision for Income Taxes | |||
Total operating income | 17,543 | 14,375 | 11,600 |
Total Assets | |||
Total assets | 334,785 | 273,909 | 281,057 |
Depreciation and Amortization | |||
Depreciation and amortization | 12,341 | 11,628 | 12,528 |
Capital Expenditures | |||
Capital expenditures | 2,211 | 1,539 | 2,144 |
Corporate | |||
Income Before Provision for Income Taxes | |||
Total operating income | (32,911) | (27,752) | (28,719) |
Total Assets | |||
Total assets | 9,473 | 10,556 | 20,816 |
Depreciation and Amortization | |||
Depreciation and amortization | 128 | 210 | 247 |
Capital Expenditures | |||
Capital expenditures | $ 20 | $ 125 | $ 61 |
Earnings per Share - Computatio
Earnings per Share - Computation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Earnings Per Share [Abstract] | |||
Net Income Attributable to Kadant | $ 84,043 | $ 55,196 | $ 52,068 |
Basic Weighted Average Shares | 11,579 | 11,482 | 11,235 |
Effect of Stock Options, Restricted Stock Units and Employee Stock Purchase Plan Shares | 76 | 82 | 222 |
Diluted Weighted Average Shares | 11,655 | 11,564 | 11,457 |
Basic (in dollars per share) | $ 7.26 | $ 4.81 | $ 4.63 |
Diluted (in dollars per share) | $ 7.21 | $ 4.77 | $ 4.54 |
Earnings per Share - Additional
Earnings per Share - Additional Information (Details) - shares | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Restricted stock unit awards | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Amount of antidilutive securities excluded from computation of EPS | 14,200 | 22,900 | 24,000 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Items - Components of AOCI on the Balance Sheet (Details) $ in Thousands | 12 Months Ended |
Jan. 01, 2022USD ($) | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Beginning balance | $ 496,905 |
Ending balance | 565,616 |
Total | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Beginning balance | (19,492) |
Other comprehensive items before reclassifications | (11,127) |
Reclassifications from AOCI | 269 |
Net current period other comprehensive items | (10,858) |
Ending balance | (30,350) |
Foreign Currency Translation Adjustment | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Beginning balance | (17,894) |
Other comprehensive items before reclassifications | (11,202) |
Reclassifications from AOCI | 0 |
Net current period other comprehensive items | (11,202) |
Ending balance | (29,096) |
Pension and Other Post-Retirement Benefit Liability Adjustments | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Beginning balance | (770) |
Other comprehensive items before reclassifications | (67) |
Reclassifications from AOCI | 45 |
Net current period other comprehensive items | (22) |
Ending balance | (792) |
Deferred Loss on Cash Flow Hedges | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |
Beginning balance | (828) |
Other comprehensive items before reclassifications | 142 |
Reclassifications from AOCI | 224 |
Net current period other comprehensive items | 366 |
Ending balance | $ (462) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Items - Reclassification Out of AOCI (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 28, 2019 | |
Reclassification Adjustment Out Of Accumulated Other Comprehensive Items [Line Items] | |||
Other expense, net | $ (104) | $ (195) | $ (6,359) |
Total expense before income taxes | 112,052 | 73,687 | 68,922 |
Income tax benefit (provision) | (27,171) | (17,948) | (16,358) |
Interest expense | (4,821) | (7,423) | (12,755) |
Cost of revenue | (449,214) | (357,722) | (410,884) |
SG&A expense | (208,787) | (181,905) | (192,525) |
Net Income | 84,881 | 55,739 | 52,564 |
Reclassification out of Accumulated Other Comprehensive Income | |||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Items [Line Items] | |||
Net Income | (269) | (200) | (6,727) |
Reclassification out of Accumulated Other Comprehensive Income | Retirement Benefit Plans | |||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Items [Line Items] | |||
Total expense before income taxes | (62) | (121) | (5,963) |
Income tax benefit (provision) | 17 | 153 | (641) |
Net Income | (45) | 32 | (6,604) |
Reclassification out of Accumulated Other Comprehensive Income | Recognized net actuarial loss | |||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Items [Line Items] | |||
Other expense, net | (50) | (66) | (70) |
Reclassification out of Accumulated Other Comprehensive Income | Amortization of prior service cost | |||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Items [Line Items] | |||
Other expense, net | (12) | (55) | (6) |
Reclassification out of Accumulated Other Comprehensive Income | Pension plan settlement loss | |||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Items [Line Items] | |||
Other expense, net | 0 | 0 | (5,887) |
Reclassification out of Accumulated Other Comprehensive Income | Cash Flow Hedges | |||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Items [Line Items] | |||
Total expense before income taxes | (294) | (305) | (177) |
Income tax benefit (provision) | 70 | 73 | 54 |
Net Income | (224) | (232) | (123) |
Reclassification out of Accumulated Other Comprehensive Income | Cash Flow Hedges | Interest Rate Swap Agreements | |||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Items [Line Items] | |||
Interest expense | (451) | (333) | (8) |
Reclassification out of Accumulated Other Comprehensive Income | Cash Flow Hedges | Forward Currency- Exchange Contracts | |||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Items [Line Items] | |||
Cost of revenue | 0 | 28 | (169) |
SG&A expense | $ 157 | $ 0 | $ 0 |
Subsequent Event (Details)
Subsequent Event (Details) - CHINA - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Apr. 02, 2022 | Jan. 01, 2022 | |
Subsequent Event [Line Items] | ||
Carrying value of facility and land use right | $ 5,264 | |
Land and Building | ||
Subsequent Event [Line Items] | ||
Expected proceeds from sale of facility and land use rights | $ 25,140 | |
Down payment (percentage) | 25.00% | |
Period of recognition of gain on sale and a receivable for remaining amount of sales proceeds (in years) | 2 years | |
Land | ||
Subsequent Event [Line Items] | ||
Expected payments for land use right | $ 3,719 | |
Subsequent event | Forecast | Land and Building | ||
Subsequent Event [Line Items] | ||
Down payment (percentage) | 6.00% |
Uncategorized Items - kai-20220
Label | Element | Value |
Accounting Standards Update 2016-02 [Member] | ||
Accounting Standards Update [Extensible Enumeration] | us-gaap_AccountingStandardsUpdateExtensibleList | Accounting Standards Update 2016-02 [Member] |