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Buildings and improvements | 5 to 40 years |
Machinery, equipment, and other | 3 to 15 years |
Standard | Description | Effect on the consolidated financial statements |
ASU 2017-04 Simplifying the Test for Goodwill Impairment | In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment, which simplifies the measurement of goodwill impairment testing by removing step two. This guidance was early adopted effective January 1, 2017 and will be applied prospectively. | The adoption of this standard did not have a financial impact on the Consolidated Financial Statements. |
Date of adoption: January 1, 2017 | ||
ASU 2016-09 Improvements to Employee Share-Based Payment Accounting | In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payment transactions for both public and nonpublic entities, including the accounting for income taxes and forfeitures. Excess tax benefits previously reported as cash flows from financing activities in the Consolidated Financial Statements are now required to be reported as operating activities. The Company adopted this guidance effective January 1, 2017. | The Corporation recorded an income tax benefit of approximately $8 million within the provision for income taxes for the year ended December 31, 2017, related to the excess tax benefit on stock options and performance share units. Prior to adoption, this amount would have been recorded as an increase to additional paid-in capital. The Corporation elected to account for forfeitures as they occur, which did not have a material impact on its Consolidated Financial Statements. |
Date of adoption: January 1, 2017 | ||
Standard | Description | Effect on the consolidated financial statements |
ASU 2014-09 Revenue from Contracts with Customers | In May 2014, the FASB issued a comprehensive new revenue recognition standard which will supersede previous existing revenue recognition guidance. The standard creates a five-step model for revenue recognition that requires companies to exercise judgment when considering contract terms and relevant facts and circumstances. The five-step model includes (1) identifying the contract, (2) identifying the separate performance obligations in the contract, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations and (5) recognizing revenue when each performance obligation has been satisfied. The standard also requires expanded disclosures surrounding revenue recognition. The standard is effective for fiscal periods beginning after December 15, 2017 and allows for either full retrospective or modified retrospective adoption. | The Corporation will apply the modified retrospective approach upon adoption as of January 1, 2018. The Corporation has completed its assessment and has identified certain contracts, primarily in the Defense and Power segments, which will be required to transition from a "point in time" model to an “over-time” model as they meet one or more of the mandatory criteria established under the new standard. The transition adjustment as of January 1, 2018 will primarily include the following: a) U.S. Government and commercial contracts where promised goods do not have alternative use and the Corporation has an enforceable right to payment for performance completed to date; b) repair and overhaul services performed on customer-owned goods; and c) Defense-related contracts where the Corporation uses customer-owned materials in production. The cumulative effect expected to be recognized upon adoption is a reduction to retained earnings of approximately $2 million, net of tax, with a corresponding increase in unbilled receivables of $18 million and decrease in inventory of $24 million. |
Date of adoption: January 1, 2018 | ||
ASU 2016-02 Leases | In February 2016, the FASB issued final guidance that will require lessees to put most leases on their balance sheets but recognize expenses on their income statements in a manner similar to today’s accounting. | The Corporation is currently evaluating the impact of the adoption of this standard on its Consolidated Financial Statements. |
Date of adoption: January 1, 2019 | ||
ASU 2017-01 Clarifying the Definition of a Business | In January 2017, the FASB issued ASU 2017-01, which clarifies the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The standard introduces a screen for determining when assets acquired are not a business and clarifies that a business must include, at a minimum, an input and a substantive process that contribute to an output. The standard is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. | The Corporation does not expect the adoption of this standard to have a material impact on its Consolidated Financial Statements. |
Date of adoption: January 1, 2018 | ||
ASU 2017-07 Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost | In March 2017, the FASB issued final guidance that requires the service cost component of net periodic benefit costs from defined benefit and other postretirement benefit plans be included in the same Consolidated Statement of Earnings captions as other compensation costs arising from services rendered by the covered employees during the period. The other components of net benefit cost will be presented in the Statement of Earnings separately from service costs. This standard is effective for fiscal years beginning after December 15, 2017. Following adoption, only service costs will be eligible for capitalization into manufactured inventories. The amendments of this standard should be applied retrospectively for the presentation of the service cost component and the other components of net periodic benefit costs. | The Corporation does not expect the adoption of this standard to have a material impact on its Consolidated Financial Statements. Any decrease in operating income due to presentation of interest cost, expected return on plan assets, amortization of prior service cost, and net actuarial gain/loss components of net periodic benefit costs outside of operating income will be offset by a corresponding increase in Other income, net, in the Consolidated Statements of Earnings. Refer to Note 15 to the Consolidated Financial Statements for the components impacting net period benefit cost for the year ended December 31, 2017. |
Date of adoption: January 1, 2018 | ||
|
|||
(In thousands) | 2017 | 2016 | 2015 | ||||||||
Net sales | $ | — | $ | — | $ | 57,992 | |||||
Loss from discontinued operations before income taxes (1) | — | — | (40,984 | ) | |||||||
Income tax benefit / (expense) | — | (2,053 | ) | (3) | 7,926 | ||||||
Loss on sale of businesses (2) | — | — | (13,729 | ) | |||||||
Loss from discontinued operations | $ | — | $ | (2,053 | ) | $ | (46,787 | ) | |||
|
|||
(In thousands) | 2017 | |||
Accounts receivable | $ | 4,994 | ||
Inventory | 22,702 | |||
Property, plant, and equipment | 4,598 | |||
Intangible assets | 88,900 | |||
Other current and non-current assets | 2,816 | |||
Current and non-current liabilities | (6,730 | ) | ||
Due to seller | (804 | ) | ||
Net tangible and intangible assets | 116,476 | |||
Purchase price | 232,630 | |||
Goodwill | $ | 116,154 | ||
Goodwill deductible for tax purposes | $ | 115,532 | ||
|
|||
(In thousands) | 2017 | 2016 | ||||||
Billed receivables: | ||||||||
Trade and other receivables | $ | 363,234 | $ | 340,091 | ||||
Less: Allowance for doubtful accounts | (7,486 | ) | (4,832 | ) | ||||
Net billed receivables | 355,748 | 335,259 | ||||||
Unbilled receivables: | ||||||||
Recoverable costs and estimated earnings not billed | 160,727 | 149,847 | ||||||
Less: Progress payments applied | (21,552 | ) | (22,044 | ) | ||||
Net unbilled receivables | 139,175 | 127,803 | ||||||
Receivables, net | $ | 494,923 | $ | 463,062 | ||||
|
|||
(In thousands) | 2017 | 2016 | ||||||
Raw material | $ | 191,855 | $ | 189,228 | ||||
Work-in-process | 73,937 | 73,843 | ||||||
Finished goods | 114,307 | 112,478 | ||||||
Inventoried costs related to U.S. Government and other long-term contracts | 65,150 | 57,516 | ||||||
Gross inventories | 445,249 | 433,065 | ||||||
Less: Inventory reserves | (54,638 | ) | (54,988 | ) | ||||
Progress payments applied, principally related to long-term contracts | (11,745 | ) | (11,103 | ) | ||||
Inventories, net | $ | 378,866 | $ | 366,974 | ||||
|
|||
(In thousands) | 2017 | 2016 | ||||||
Land | $ | 19,947 | $ | 19,511 | ||||
Buildings and improvements | 234,539 | 215,221 | ||||||
Machinery, equipment, and other | 783,430 | 752,356 | ||||||
Property, plant, and equipment, at cost | 1,037,916 | 987,088 | ||||||
Less: Accumulated depreciation | (647,681 | ) | (598,185 | ) | ||||
Property, plant, and equipment, net | $ | 390,235 | $ | 388,903 | ||||
|
|||
(In thousands) | Commercial/Industrial | Defense | Power | Consolidated | ||||||||||||
December 31, 2015 | $ | 447,828 | $ | 337,603 | $ | 187,175 | $ | 972,606 | ||||||||
Divestitures | — | (452 | ) | — | (452 | ) | ||||||||||
Foreign currency translation adjustment | (11,687 | ) | (9,496 | ) | 86 | (21,097 | ) | |||||||||
December 31, 2016 | $ | 436,141 | $ | 327,655 | $ | 187,261 | $ | 951,057 | ||||||||
Acquisitions | 2,677 | 113,477 | 116,154 | |||||||||||||
Divestitures | (1,168 | ) | (647 | ) | (1,815 | ) | ||||||||||
Foreign currency translation adjustment | 10,881 | 19,847 | 205 | 30,933 | ||||||||||||
December 31, 2017 | $ | 448,531 | $ | 460,332 | $ | 187,466 | $ | 1,096,329 | ||||||||
|
|||
2017 | 2016 | |||||||||||||||||||||||
(In thousands) | Gross | Accumulated Amortization | Net | Gross | Accumulated Amortization | Net | ||||||||||||||||||
Technology | $ | 243,440 | $ | (114,036 | ) | $ | 129,404 | $ | 166,859 | $ | (98,266 | ) | $ | 68,593 | ||||||||||
Customer related intangibles | 367,230 | (180,580 | ) | 186,650 | 349,742 | (157,154 | ) | 192,588 | ||||||||||||||||
Other intangible assets | 40,640 | (27,026 | ) | 13,614 | 36,709 | (26,429 | ) | 10,280 | ||||||||||||||||
Total | $ | 651,310 | $ | (321,642 | ) | $ | 329,668 | $ | 553,310 | $ | (281,849 | ) | $ | 271,461 | ||||||||||
(In thousands) | ||||
2018 | $ | 38,159 | ||
2019 | 36,405 | |||
2020 | 34,440 | |||
2021 | 32,644 | |||
2022 | 30,085 | |||
|
|||
Gain/(Loss) on Swap | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Other income, net | ||||||||||||
Interest rate swaps | $ | — | $ | — | $ | 8,204 | ||||||
Hedged fixed rate debt | $ | — | $ | — | $ | (8,204 | ) | |||||
Total | $ | — | $ | — | $ | — | ||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Forward exchange contracts: | ||||||||||||
General and administrative expenses | $ | (346 | ) | $ | 11,510 | $ | 11,042 | |||||
|
|||
(In thousands) | 2017 | 2016 | ||||||
Accrued compensation | $ | 108,268 | $ | 85,970 | ||||
Accrued commissions | 6,296 | 5,189 | ||||||
Accrued interest | 9,894 | 9,817 | ||||||
Accrued insurance | 7,015 | 7,521 | ||||||
Other | 18,933 | 21,742 | ||||||
Total accrued expenses | $ | 150,406 | $ | 130,239 | ||||
(In thousands) | 2017 | 2016 | ||||||
Warranty reserves | $ | 14,212 | $ | 11,768 | ||||
Additional amounts due to sellers on acquisitions | 1,941 | 1,985 | ||||||
Reserves on loss contracts | 1,418 | 1,662 | ||||||
Pension and other postretirement liabilities | 5,060 | 5,331 | ||||||
Other | 13,179 | 7,281 | ||||||
Total other current liabilities | $ | 35,810 | $ | 28,027 | ||||
|
|||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Domestic | $ | 179,006 | $ | 154,571 | $ | 135,112 | ||||||
Foreign | 120,613 | 113,390 | 140,082 | |||||||||
$ | 299,619 | $ | 267,961 | $ | 275,194 | |||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Current: | ||||||||||||
Federal | $ | 54,963 | $ | 45,523 | $ | (6,741 | ) | |||||
State | 2,648 | 8,002 | 6,175 | |||||||||
Foreign | 23,162 | 20,861 | 27,134 | |||||||||
Total current | 80,773 | 74,386 | 26,568 | |||||||||
Deferred: | ||||||||||||
Federal | 2,595 | 4,267 | 49,060 | |||||||||
State | 4,282 | 73 | 7,390 | |||||||||
Foreign | (2,922 | ) | (147 | ) | (72 | ) | ||||||
Total deferred | 3,955 | 4,193 | 56,378 | |||||||||
Provision for income taxes | $ | 84,728 | $ | 78,579 | $ | 82,946 | ||||||
2017 | 2016 | 2015 | |||||||
U.S. federal statutory tax rate | 35.0 | % | 35.0 | % | 35.0 | % | |||
Add (deduct): | |||||||||
State and local taxes, net of federal benefit | 1.8 | 1.1 | 4.3 | ||||||
R&D tax credits | (1.3 | ) | (0.9 | ) | (1.3 | ) | |||
Foreign earnings (1) | (6.0 | ) | (5.8 | ) | (6.2 | ) | |||
Stock compensation - excess tax benefits | (2.6 | ) | — | — | |||||
Impacts related to the Tax Act | 3.4 | — | — | ||||||
All other, net | (2.0 | ) | (0.1 | ) | (1.7 | ) | |||
Effective tax rate | 28.3 | % | 29.3 | % | 30.1 | % | |||
(In thousands) | 2017 | 2016 | ||||||
Deferred tax assets: | ||||||||
Pension plans | $ | 18,903 | $ | 45,568 | ||||
Environmental reserves | 7,109 | 9,871 | ||||||
Inventories | 15,116 | 21,758 | ||||||
Postretirement/postemployment benefits | 8,241 | 13,542 | ||||||
Incentive compensation | 7,721 | 9,425 | ||||||
Net operating loss | 10,908 | 10,345 | ||||||
Capital loss carryover | 7,047 | 11,352 | ||||||
Other | 28,775 | 39,977 | ||||||
Total deferred tax assets | 103,820 | 161,838 | ||||||
Deferred tax liabilities: | ||||||||
Depreciation | 19,586 | 25,963 | ||||||
Goodwill amortization | 67,779 | 97,667 | ||||||
Other intangible amortization | 38,252 | 51,712 | ||||||
Other | 12,636 | 16,225 | ||||||
Total deferred tax liabilities | 138,253 | 191,567 | ||||||
Valuation allowance | 12,322 | 17,776 | ||||||
Net deferred tax liabilities | $ | 46,755 | $ | 47,505 | ||||
(In thousands) | 2017 | 2016 | ||||||
Net noncurrent deferred tax assets | 2,605 | 2,217 | ||||||
Net noncurrent deferred tax liabilities | 49,360 | 49,722 | ||||||
Net deferred tax liabilities | $ | 46,755 | $ | 47,505 | ||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Balance as of January 1, | $ | 11,454 | $ | 12,414 | $ | 11,560 | ||||||
Additions for tax positions of prior periods | 1,069 | 32 | 359 | |||||||||
Reductions for tax positions of prior periods | (194 | ) | (1,679 | ) | — | |||||||
Additions for tax positions related to the current year | 1,273 | 789 | 2,026 | |||||||||
Settlements | (428 | ) | (102 | ) | (1,414 | ) | ||||||
Foreign currency translation | — | — | (117 | ) | ||||||||
Balance as of December 31, | $ | 13,174 | $ | 11,454 | $ | 12,414 | ||||||
United States (Federal) | 2014 | - | present |
United States (Various states) | 2006 | - | present |
United Kingdom | 2010 | - | present |
Canada | 2011 | - | present |
|
|||
(In thousands) | 2017 | 2017 | 2016 | 2016 | ||||
Carrying Value | Estimated Fair Value | Carrying Value | Estimated Fair Value | |||||
5.51% Senior notes due 2017 | — | — | 150,000 | 154,509 | ||||
3.84% Senior notes due 2021 | 100,000 | 102,472 | 100,000 | 102,463 | ||||
3.70% Senior notes due 2023 | 225,000 | 228,783 | 225,000 | 226,946 | ||||
3.85% Senior notes due 2025 | 100,000 | 102,164 | 100,000 | 100,338 | ||||
4.24% Senior notes due 2026 | 200,000 | 208,873 | 200,000 | 203,592 | ||||
4.05% Senior notes due 2028 | 75,000 | 76,997 | 75,000 | 74,630 | ||||
4.11% Senior notes due 2028 | 100,000 | 103,226 | 100,000 | 99,876 | ||||
Other debt | 150 | 150 | 668 | 668 | ||||
Total debt | 800,150 | 822,665 | 950,668 | 963,022 | ||||
Debt issuance costs, net | (831) | (831) | (984) | (984) | ||||
Unamortized interest rate swap proceeds | 14,820 | 14,820 | 16,614 | 16,614 | ||||
Total debt, net | 814,139 | 836,654 | 966,298 | 978,652 | ||||
Less: current portion of long-term debt and short-term debt | 150 | 150 | 150,668 | 150,668 | ||||
Total long-term debt | $813,989 | $836,504 | $815,630 | $827,984 | ||||
(In thousands) | |||
2018 | $ | 150 | |
2019 | — | ||
2020 | — | ||
2021 | 100,000 | ||
2022 | — | ||
Thereafter | 700,000 | ||
Total | $ | 800,150 | |
|
|||
(In thousands, except per share data) | Earnings from continuing operations | Weighted- Average Shares Outstanding | Earnings per share from continuing operations | ||||||||
2017 | |||||||||||
Basic earnings per share from continuing operations | $ | 214,891 | 44,182 | $ | 4.86 | ||||||
Dilutive effect of stock options and deferred stock compensation | 579 | ||||||||||
Diluted earnings per share from continuing operations | $ | 214,891 | 44,761 | $ | 4.80 | ||||||
2016 | |||||||||||
Basic earnings per share from continuing operations | $ | 189,382 | 44,389 | $ | 4.27 | ||||||
Dilutive effect of stock options and deferred stock compensation | 656 | ||||||||||
Diluted earnings per share from continuing operations | $ | 189,382 | 45,045 | $ | 4.20 | ||||||
2015 | |||||||||||
Basic earnings per share from continuing operations | $ | 192,248 | 46,624 | $ | 4.12 | ||||||
Dilutive effect of stock options and deferred stock compensation | 992 | ||||||||||
Diluted earnings per share from continuing operations | $ | 192,248 | 47,616 | $ | 4.04 | ||||||
|
|||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Employee Stock Purchase Plan | 1,207 | 1,184 | 1,279 | |||||||||
Performance Share Units | 4,340 | 3,910 | 4,349 | |||||||||
Restricted Share Units | 4,931 | 3,426 | 3,015 | |||||||||
Other share-based payments | 1,094 | 958 | 830 | |||||||||
Total share-based compensation expense before income taxes | $ | 11,572 | $ | 9,478 | $ | 9,473 | ||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Cash received from share-based awards | $ | 14,179 | $ | 22,300 | $ | 28,706 | ||||||
Shares (000’s) | Weighted- Average Exercise Price | Weighted- Average Remaining Contractual Term in Years | Aggregate Intrinsic Value (000’s) | ||||||||||
Outstanding as of December 31, 2016 | 443 | $ | 31.91 | ||||||||||
Exercised | (179 | ) | 34.24 | ||||||||||
Outstanding as of December 31, 2017 | 264 | $ | 30.30 | 2.2 | $ | 24,093 | |||||||
Exercisable as of December 31, 2017 | 264 | $ | 30.30 | 2.2 | $ | 24,093 | |||||||
Performance Share Units (PSUs) | Restricted Share Units (RSUs) | |||||||||||||
Shares/Units (000’s) | Weighted- Average Fair Value | Shares/Units (000’s) | Weighted- Average Fair Value | |||||||||||
Nonvested as of December 31, 2016 | 204 | $ | 71.28 | 204 | $ | 74.38 | ||||||||
Granted | 68 | 62.91 | 1 | 98.34 | ||||||||||
Vested | (137 | ) | 62.91 | (34 | ) | 70.36 | ||||||||
Forfeited | — | — | (2 | ) | 85.47 | |||||||||
Nonvested as of December 31, 2017 | 135 | $ | 75.51 | 169 | $ | 75.19 | ||||||||
Expected to vest as of December 31, 2017 | 135 | $ | 75.51 | 169 | $ | 75.19 | ||||||||
|
|||
Pension Benefits | Postretirement Benefits | |||||||||||||||||||||||
(In thousands) | 2017 | 2016 | 2015 | 2017 | 2016 | 2015 | ||||||||||||||||||
Service cost | $ | 25,093 | $ | 25,100 | $ | 26,873 | $ | 435 | $ | 338 | $ | 286 | ||||||||||||
Interest cost | 25,895 | 30,495 | 30,050 | 762 | 996 | 842 | ||||||||||||||||||
Expected return on plan assets | (53,552 | ) | (54,101 | ) | (54,629 | ) | — | — | — | |||||||||||||||
Amortization of prior service cost | (100 | ) | (46 | ) | 618 | (656 | ) | (657 | ) | (657 | ) | |||||||||||||
Recognized net actuarial loss/(gain) | 12,925 | 12,029 | 16,890 | (223 | ) | (296 | ) | (551 | ) | |||||||||||||||
Cost of settlements/curtailments | 327 | — | 7,461 | — | — | — | ||||||||||||||||||
Net periodic benefit cost (income) | $ | 10,588 | $ | 13,477 | $ | 27,263 | $ | 318 | $ | 381 | $ | (80 | ) | |||||||||||
Pension Benefits | Postretirement Benefits | |||||||||||||||
(In thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Change in benefit obligation: | ||||||||||||||||
Beginning of year | $ | 798,605 | $ | 774,710 | $ | 24,436 | $ | 21,980 | ||||||||
Service cost | 25,093 | 25,100 | 435 | 338 | ||||||||||||
Interest cost | 25,895 | 30,495 | 762 | 996 | ||||||||||||
Plan participants’ contributions | 1,655 | 1,897 | 253 | 266 | ||||||||||||
Amendments | — | — | — | — | ||||||||||||
Actuarial loss | 56,727 | 19,640 | 2,056 | 3,372 | ||||||||||||
Benefits paid | (45,384 | ) | (41,115 | ) | (2,907 | ) | (2,516 | ) | ||||||||
Actual expenses | (1,301 | ) | (1,206 | ) | — | — | ||||||||||
Currency translation adjustments | 7,597 | (10,916 | ) | — | — | |||||||||||
End of year | $ | 868,887 | $ | 798,605 | $ | 25,035 | $ | 24,436 | ||||||||
Change in plan assets: | ||||||||||||||||
Beginning of year | $ | 714,608 | $ | 692,074 | $ | — | $ | — | ||||||||
Actual return on plan assets | 94,960 | 65,872 | — | — | ||||||||||||
Employer contribution | 4,561 | 8,210 | 2,654 | 2,250 | ||||||||||||
Plan participants’ contributions | 1,655 | 1,897 | 253 | 266 | ||||||||||||
Benefits paid | (45,384 | ) | (41,115 | ) | (2,907 | ) | (2,516 | ) | ||||||||
Actual Expenses | (1,301 | ) | (1,206 | ) | — | — | ||||||||||
Currency translation adjustments | 7,383 | (11,124 | ) | — | — | |||||||||||
End of year | $ | 776,482 | $ | 714,608 | $ | — | $ | — | ||||||||
Funded status | $ | (92,405 | ) | $ | (83,997 | ) | $ | (25,035 | ) | $ | (24,436 | ) | ||||
Pension Benefits | Postretirement Benefits | |||||||||||||||
(In thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Amounts recognized on the balance sheet | ||||||||||||||||
Noncurrent assets | $ | 8,663 | $ | 4,049 | $ | — | $ | — | ||||||||
Current liabilities | (3,374 | ) | (3,498 | ) | (1,686 | ) | (1,833 | ) | ||||||||
Noncurrent liabilities | (97,694 | ) | (84,548 | ) | (23,349 | ) | (22,603 | ) | ||||||||
Total | $ | (92,405 | ) | $ | (83,997 | ) | $ | (25,035 | ) | $ | (24,436 | ) | ||||
Amounts recognized in accumulated other comprehensive income (AOCI) | ||||||||||||||||
Net actuarial loss (gain) | $ | 201,390 | $ | 198,630 | $ | (2,899 | ) | $ | (5,178 | ) | ||||||
Prior service cost | (1,461 | ) | (1,580 | ) | (2,718 | ) | (3,373 | ) | ||||||||
Total | $ | 199,929 | $ | 197,050 | $ | (5,617 | ) | $ | (8,551 | ) | ||||||
Amounts in AOCI expected to be recognized in net periodic cost in the coming year: | ||||||||||||||||
Loss (gain) recognition | $ | 15,615 | $ | 11,793 | $ | (29 | ) | $ | (203 | ) | ||||||
Prior service cost recognition | $ | (250 | ) | $ | (105 | ) | $ | (657 | ) | $ | (657 | ) | ||||
Accumulated benefit obligation | $ | 834,745 | $ | 767,461 | N/A | N/A | ||||||||||
Information for pension plans with an accumulated benefit obligation in excess of plan assets: | ||||||||||||||||
Projected benefit obligation | $ | 785,039 | $ | 733,426 | N/A | N/A | ||||||||||
Accumulated benefit obligation | 752,371 | 702,282 | N/A | N/A | ||||||||||||
Fair value of plan assets | 684,756 | 645,380 | N/A | N/A | ||||||||||||
Pension Benefits | Postretirement Benefits | |||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||
Weighted-average assumptions in determination of benefit obligation: | ||||||||||||
Discount rate | 3.46 | % | 3.88 | % | 3.54 | % | 4.00 | % | ||||
Rate of compensation increase | 3.55 | % | 3.35 | % | N/A | N/A | ||||||
Health care cost trends: | ||||||||||||
Rate assumed for subsequent year | N/A | N/A | 8.30 | % | 8.25 | % | ||||||
Ultimate rate reached in 2026 | N/A | N/A | 4.50 | % | 4.50 | % | ||||||
Weighted-average assumptions in determination of net periodic benefit cost: | ||||||||||||
Discount rate | 3.93 | % | 4.12 | % | 4.02 | % | 4.25 | % | ||||
Expected return on plan assets | 7.47 | % | 7.81 | % | N/A | N/A | ||||||
Rate of compensation increase | 3.54 | % | 3.35 | % | N/A | N/A | ||||||
Health care cost trends: | ||||||||||||
Rate assumed for subsequent year | N/A | N/A | 8.25 | % | 8.75 | % | ||||||
Ultimate rate reached in 2026 | N/A | N/A | 4.50 | % | 4.50 | % | ||||||
(In thousands) | 1% Increase | 1% Decrease | ||||||
Total service and interest cost components | $ | 28 | $ | (23 | ) | |||
Postretirement benefit obligation | $ | 502 | $ | (414 | ) | |||
As of December 31, | Target | Expected | ||||||
2017 | 2016 | Exposure | Range | |||||
Asset class | ||||||||
Domestic equities | 52% | 54% | 50% | 40%-60% | ||||
International equities | 15% | 13% | 15% | 10%-20% | ||||
Total equity | 67% | 67% | 65% | 55%-75% | ||||
Fixed income | 33% | 33% | 35% | 25%-45% | ||||
Asset Category | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
Cash and cash equivalents | $ | 23,979 | $ | 4,893 | $ | 19,086 | $ | — | ||||||||
Equity securities- Mutual funds (1) | 459,002 | 418,390 | 40,612 | — | ||||||||||||
Bond funds (2) | 219,249 | 155,120 | 64,129 | — | ||||||||||||
Insurance Contracts (3) | 10,760 | — | — | 10,760 | ||||||||||||
Other (4) | 1,618 | — | — | 1,618 | ||||||||||||
December 31, 2016 | $ | 714,608 | $ | 578,403 | $ | 123,827 | $ | 12,378 | ||||||||
Cash and cash equivalents | $ | 42,374 | $ | 12,551 | $ | 29,823 | $ | — | ||||||||
Equity securities- Mutual funds (1) | 504,633 | 455,175 | 49,458 | — | ||||||||||||
Bond funds (2) | 216,372 | 150,265 | 66,107 | — | ||||||||||||
Insurance Contracts (3) | 10,912 | — | — | 10,912 | ||||||||||||
Other (4) | 2,191 | — | — | 2,191 | ||||||||||||
December 31, 2017 | $ | 776,482 | $ | 617,991 | $ | 145,388 | $ | 13,103 | ||||||||
(In thousands) | Insurance Contracts | Other | Total | |||||||||
December 31, 2015 | $ | 9,720 | $ | 755 | $ | 10,475 | ||||||
Actual return on plan assets: | ||||||||||||
Relating to assets still held at the reporting date | 148 | 35 | 183 | |||||||||
Purchases, sales, and settlements | 1,095 | 871 | 1,966 | |||||||||
Foreign currency translation adjustment | (203 | ) | (43 | ) | (246 | ) | ||||||
December 31, 2016 | $ | 10,760 | $ | 1,618 | $ | 12,378 | ||||||
Actual return on plan assets: | ||||||||||||
Relating to assets still held at the reporting date | 167 | 58 | 226 | |||||||||
Purchases, sales, and settlements | (503 | ) | 436 | (68 | ) | |||||||
Foreign currency translation adjustment | 488 | 79 | 567 | |||||||||
December 31, 2017 | $ | 10,912 | $ | 2,191 | $ | 13,103 | ||||||
(In thousands) | Pension Plans | Postretirement Plans | Total | |||||||||
2018 | $ | 45,604 | $ | 1,686 | $ | 47,290 | ||||||
2019 | 48,937 | 1,693 | 50,630 | |||||||||
2020 | 49,859 | 1,694 | 51,553 | |||||||||
2021 | 51,058 | 1,689 | 52,747 | |||||||||
2022 | 50,361 | 1,678 | 52,039 | |||||||||
2023 — 2027 | 266,582 | 8,030 | 274,612 | |||||||||
|
|||
(In thousands) | Rental Commitments | ||
2018 | $ | 28,284 | |
2019 | 24,378 | ||
2020 | 21,733 | ||
2021 | 17,577 | ||
2022 | 14,253 | ||
Thereafter | 73,870 | ||
Total | $ | 180,095 | |
|
|||
Year Ended December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Net sales | ||||||||||||
Commercial/Industrial | $ | 1,163,510 | $ | 1,120,326 | $ | 1,189,120 | ||||||
Defense | 557,954 | 469,796 | 479,528 | |||||||||
Power | 554,048 | 524,967 | 545,013 | |||||||||
Less: Intersegment Revenues | (4,486 | ) | (6,158 | ) | (7,978 | ) | ||||||
Total Consolidated | $ | 2,271,026 | $ | 2,108,931 | $ | 2,205,683 | ||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Operating income (expense) | ||||||||||||
Commercial/Industrial | $ | 168,328 | $ | 156,550 | $ | 171,525 | ||||||
Defense | 109,355 | 98,291 | 98,895 | |||||||||
Power | 85,260 | 76,472 | 74,987 | |||||||||
Corporate and Eliminations (1) | (23,200 | ) | (23,215 | ) | (34,790 | ) | ||||||
Total Consolidated | $ | 339,743 | $ | 308,098 | $ | 310,617 | ||||||
Depreciation and amortization expense | ||||||||||||
Commercial/Industrial | $ | 53,180 | $ | 53,970 | $ | 55,799 | ||||||
Defense | 20,702 | 14,488 | 15,965 | |||||||||
Power | 22,019 | 23,032 | 23,419 | |||||||||
Corporate | 4,094 | 4,518 | 4,292 | |||||||||
Total Consolidated | $ | 99,995 | $ | 96,008 | $ | 99,475 | ||||||
Segment assets | ||||||||||||
Commercial/Industrial | $ | 1,444,097 | $ | 1,391,040 | $ | 1,480,052 | ||||||
Defense | 1,044,776 | 751,859 | 800,613 | |||||||||
Power | 482,753 | 516,321 | 629,612 | |||||||||
Corporate | 264,695 | 378,561 | 79,334 | |||||||||
Total Consolidated | $ | 3,236,321 | $ | 3,037,781 | $ | 2,989,611 | ||||||
Capital expenditures | ||||||||||||
Commercial/Industrial | $ | 29,028 | $ | 30,145 | $ | 21,990 | ||||||
Defense | 9,276 | 5,870 | 3,834 | |||||||||
Power | 10,039 | 6,653 | 6,163 | |||||||||
Corporate | 4,362 | 4,108 | 3,525 | |||||||||
Total Consolidated (2) | $ | 52,705 | $ | 46,776 | $ | 35,512 | ||||||
Year Ended December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Earnings before taxes: | ||||||||||||
Total segment operating income | $ | 362,943 | $ | 331,313 | $ | 345,407 | ||||||
Corporate and Eliminations | (23,200 | ) | (23,215 | ) | (34,790 | ) | ||||||
Interest expense | 41,471 | 41,248 | 36,038 | |||||||||
Other income, net | 1,347 | 1,111 | 615 | |||||||||
Total consolidated earnings before tax | $ | 299,619 | $ | 267,961 | $ | 275,194 | ||||||
As of December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Assets: | ||||||||||||
Total assets for reportable segments | $ | 2,971,626 | $ | 2,659,220 | $ | 2,910,277 | ||||||
Non-segment cash | 204,664 | 357,021 | 42,164 | |||||||||
Other assets | 60,031 | 21,540 | 37,170 | |||||||||
Total consolidated assets | $ | 3,236,321 | $ | 3,037,781 | $ | 2,989,611 | ||||||
Year Ended December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Revenues | ||||||||||||
United States of America | $ | 1,562,180 | $ | 1,472,241 | $ | 1,502,363 | ||||||
United Kingdom | 118,350 | 114,752 | 135,673 | |||||||||
Other foreign countries | 590,496 | 521,938 | 567,647 | |||||||||
Consolidated total | $ | 2,271,026 | $ | 2,108,931 | $ | 2,205,683 | ||||||
As of December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Long-Lived Assets | ||||||||||||
United States of America | $ | 264,829 | $ | 272,826 | $ | 293,612 | ||||||
United Kingdom | 41,100 | 39,014 | 36,061 | |||||||||
Other foreign countries | 84,306 | 77,063 | 83,971 | |||||||||
Consolidated total | $ | 390,235 | $ | 388,903 | $ | 413,644 | ||||||
Year Ended December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Net sales | ||||||||||||
Flow Control | $ | 899,705 | $ | 883,735 | $ | 949,657 | ||||||
Motion Control | 1,075,218 | 940,162 | 947,758 | |||||||||
Surface Technologies | 296,103 | 285,034 | 308,268 | |||||||||
Consolidated total | $ | 2,271,026 | $ | 2,108,931 | $ | 2,205,683 | ||||||
|
|||
|
|||
(In thousands) | Foreign currency translation adjustments, net | Total pension and postretirement adjustments, net | Accumulated other comprehensive income (loss) | |||||||||
December 31, 2015 | $ | (107,810 | ) | $ | (118,118 | ) | $ | (225,928 | ) | |||
Other comprehensive loss before reclassifications (1) | (64,840 | ) | (7,892 | ) | (72,732 | ) | ||||||
Amounts reclassified from accumulated other comprehensive income (1) | — | 6,904 | 6,904 | |||||||||
Net current period other comprehensive loss | (64,840 | ) | (988 | ) | (65,828 | ) | ||||||
December 31, 2016 | $ | (172,650 | ) | $ | (119,106 | ) | $ | (291,756 | ) | |||
Other comprehensive loss before reclassifications (1) | 77,942 | (10,831 | ) | 67,111 | ||||||||
Amounts reclassified from accumulated other comprehensive income (1) | — | 7,805 | 7,805 | |||||||||
Net current period other comprehensive income (loss) | 77,942 | (3,026 | ) | 74,916 | ||||||||
December 31, 2017 | $ | (94,708 | ) | $ | (122,132 | ) | $ | (216,840 | ) | |||
(1) | All amounts are after tax. |
Amount reclassified from Accumulated other comprehensive income (loss) | Affected line item in the statement where net earnings is presented | |||||||||
(In thousands) | 2017 | 2016 | ||||||||
Defined benefit pension and postretirement plans | ||||||||||
Amortization of prior service costs | 756 | 703 | (1) | |||||||
Amortization of net actuarial losses | (12,702 | ) | (11,733 | ) | (1) | |||||
Settlements | (327 | ) | — | (1) | ||||||
(12,273 | ) | (11,030 | ) | Total before tax | ||||||
4,468 | 4,126 | Income tax effect | ||||||||
Total reclassifications | $ | (7,805 | ) | $ | (6,904 | ) | Net of tax | |||
(1) | These items are included in the computation of net periodic pension cost. See Note 15, Pension and Other Postretirement Benefit Plans. |
|
|||
(In thousands, except per share data) | First | Second | Third | Fourth | ||||||||||||
2017 | ||||||||||||||||
Net sales | $ | 523,591 | $ | 567,653 | $ | 567,901 | $ | 611,881 | ||||||||
Gross profit | 170,775 | 198,770 | 210,783 | 238,267 | ||||||||||||
Earnings from continuing operations | 32,547 | 50,650 | 63,944 | 67,750 | ||||||||||||
Loss from discontinued operations | — | — | — | — | ||||||||||||
Net earnings | 32,547 | 50,650 | 63,944 | 67,750 | ||||||||||||
Basic earnings per share | ||||||||||||||||
Earnings from continuing operations | $ | 0.74 | $ | 1.15 | $ | 1.45 | $ | 1.54 | ||||||||
Loss from discontinued operations | $ | — | $ | — | $ | — | $ | — | ||||||||
Total | $ | 0.74 | $ | 1.15 | $ | 1.45 | $ | 1.54 | ||||||||
Diluted earnings per share | ||||||||||||||||
Earnings from continuing operations | $ | 0.73 | $ | 1.13 | $ | 1.43 | $ | 1.52 | ||||||||
Loss from discontinued operations | $ | — | $ | — | $ | — | $ | — | ||||||||
Total | $ | 0.73 | $ | 1.13 | $ | 1.43 | $ | 1.52 | ||||||||
2016 | ||||||||||||||||
Net sales | $ | 503,507 | $ | 532,766 | $ | 507,092 | $ | 565,566 | ||||||||
Gross profit | 171,903 | 185,379 | 184,476 | 208,725 | ||||||||||||
Earnings from continuing operations | 32,819 | 39,963 | 45,932 | 70,668 | ||||||||||||
Loss from discontinued operations | — | — | — | (2,053 | ) | |||||||||||
Net earnings | 32,819 | 39,963 | 45,932 | 68,615 | ||||||||||||
Basic earnings per share | ||||||||||||||||
Earnings from continuing operations | $ | 0.74 | $ | 0.90 | $ | 1.04 | $ | 1.60 | ||||||||
Loss from discontinued operations | — | — | — | (0.05 | ) | |||||||||||
Total | $ | 0.74 | $ | 0.90 | $ | 1.04 | $ | 1.55 | ||||||||
Diluted earnings per share | ||||||||||||||||
Earnings from continuing operations | $ | 0.73 | $ | 0.88 | $ | 1.02 | $ | 1.58 | ||||||||
Loss from discontinued operations | — | — | — | (0.05 | ) | |||||||||||
Total | $ | 0.73 | $ | 0.88 | $ | 1.02 | $ | 1.53 | ||||||||
|
|||
|
|||
Additions | ||||||||||||||||||||||||
Description | Balance at Beginning of Period | Charged to Costs and Expenses | Charged to Other Accounts | Deductions | Balance at End of Period | |||||||||||||||||||
Deducted from assets to which they apply: | ||||||||||||||||||||||||
December 31, 2017 | ||||||||||||||||||||||||
Tax valuation allowance | 17,776 | 1,471 | 125 | (1) | 7,050 | (3) | 12,322 | |||||||||||||||||
Total | $ | 17,776 | $ | 1,471 | $ | 125 | $ | 7,050 | $ | 12,322 | ||||||||||||||
December 31, 2016 | ||||||||||||||||||||||||
Tax valuation allowance | 17,895 | 1,951 | (181 | ) | (1) | 1,889 | (2) | 17,776 | ||||||||||||||||
Total | $ | 17,895 | $ | 1,951 | $ | (181 | ) | $ | 1,889 | $ | 17,776 | |||||||||||||
December 31, 2015 | ||||||||||||||||||||||||
Tax valuation allowance | 23,478 | 2,605 | (299 | ) | (1) | 7,889 | 17,895 | |||||||||||||||||
Total | $ | 23,478 | $ | 2,605 | $ | (299 | ) | $ | 7,889 | $ | 17,895 | |||||||||||||
|
|||
Buildings and improvements | 5 to 40 years |
Machinery, equipment, and other | 3 to 15 years |
Standard | Description | Effect on the consolidated financial statements |
ASU 2017-04 Simplifying the Test for Goodwill Impairment | In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment, which simplifies the measurement of goodwill impairment testing by removing step two. This guidance was early adopted effective January 1, 2017 and will be applied prospectively. | The adoption of this standard did not have a financial impact on the Consolidated Financial Statements. |
Date of adoption: January 1, 2017 | ||
ASU 2016-09 Improvements to Employee Share-Based Payment Accounting | In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payment transactions for both public and nonpublic entities, including the accounting for income taxes and forfeitures. Excess tax benefits previously reported as cash flows from financing activities in the Consolidated Financial Statements are now required to be reported as operating activities. The Company adopted this guidance effective January 1, 2017. | The Corporation recorded an income tax benefit of approximately $8 million within the provision for income taxes for the year ended December 31, 2017, related to the excess tax benefit on stock options and performance share units. Prior to adoption, this amount would have been recorded as an increase to additional paid-in capital. The Corporation elected to account for forfeitures as they occur, which did not have a material impact on its Consolidated Financial Statements. |
Date of adoption: January 1, 2017 | ||
Standard | Description | Effect on the consolidated financial statements |
ASU 2014-09 Revenue from Contracts with Customers | In May 2014, the FASB issued a comprehensive new revenue recognition standard which will supersede previous existing revenue recognition guidance. The standard creates a five-step model for revenue recognition that requires companies to exercise judgment when considering contract terms and relevant facts and circumstances. The five-step model includes (1) identifying the contract, (2) identifying the separate performance obligations in the contract, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations and (5) recognizing revenue when each performance obligation has been satisfied. The standard also requires expanded disclosures surrounding revenue recognition. The standard is effective for fiscal periods beginning after December 15, 2017 and allows for either full retrospective or modified retrospective adoption. | The Corporation will apply the modified retrospective approach upon adoption as of January 1, 2018. The Corporation has completed its assessment and has identified certain contracts, primarily in the Defense and Power segments, which will be required to transition from a "point in time" model to an “over-time” model as they meet one or more of the mandatory criteria established under the new standard. The transition adjustment as of January 1, 2018 will primarily include the following: a) U.S. Government and commercial contracts where promised goods do not have alternative use and the Corporation has an enforceable right to payment for performance completed to date; b) repair and overhaul services performed on customer-owned goods; and c) Defense-related contracts where the Corporation uses customer-owned materials in production. The cumulative effect expected to be recognized upon adoption is a reduction to retained earnings of approximately $2 million, net of tax, with a corresponding increase in unbilled receivables of $18 million and decrease in inventory of $24 million. |
Date of adoption: January 1, 2018 | ||
ASU 2016-02 Leases | In February 2016, the FASB issued final guidance that will require lessees to put most leases on their balance sheets but recognize expenses on their income statements in a manner similar to today’s accounting. | The Corporation is currently evaluating the impact of the adoption of this standard on its Consolidated Financial Statements. |
Date of adoption: January 1, 2019 | ||
ASU 2017-01 Clarifying the Definition of a Business | In January 2017, the FASB issued ASU 2017-01, which clarifies the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The standard introduces a screen for determining when assets acquired are not a business and clarifies that a business must include, at a minimum, an input and a substantive process that contribute to an output. The standard is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. | The Corporation does not expect the adoption of this standard to have a material impact on its Consolidated Financial Statements. |
Date of adoption: January 1, 2018 | ||
ASU 2017-07 Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost | In March 2017, the FASB issued final guidance that requires the service cost component of net periodic benefit costs from defined benefit and other postretirement benefit plans be included in the same Consolidated Statement of Earnings captions as other compensation costs arising from services rendered by the covered employees during the period. The other components of net benefit cost will be presented in the Statement of Earnings separately from service costs. This standard is effective for fiscal years beginning after December 15, 2017. Following adoption, only service costs will be eligible for capitalization into manufactured inventories. The amendments of this standard should be applied retrospectively for the presentation of the service cost component and the other components of net periodic benefit costs. | The Corporation does not expect the adoption of this standard to have a material impact on its Consolidated Financial Statements. Any decrease in operating income due to presentation of interest cost, expected return on plan assets, amortization of prior service cost, and net actuarial gain/loss components of net periodic benefit costs outside of operating income will be offset by a corresponding increase in Other income, net, in the Consolidated Statements of Earnings. Refer to Note 15 to the Consolidated Financial Statements for the components impacting net period benefit cost for the year ended December 31, 2017. |
Date of adoption: January 1, 2018 | ||
|
|||
(In thousands) | 2017 | 2016 | 2015 | ||||||||
Net sales | $ | — | $ | — | $ | 57,992 | |||||
Loss from discontinued operations before income taxes (1) | — | — | (40,984 | ) | |||||||
Income tax benefit / (expense) | — | (2,053 | ) | (3) | 7,926 | ||||||
Loss on sale of businesses (2) | — | — | (13,729 | ) | |||||||
Loss from discontinued operations | $ | — | $ | (2,053 | ) | $ | (46,787 | ) | |||
|
|||
(In thousands) | 2017 | |||
Accounts receivable | $ | 4,994 | ||
Inventory | 22,702 | |||
Property, plant, and equipment | 4,598 | |||
Intangible assets | 88,900 | |||
Other current and non-current assets | 2,816 | |||
Current and non-current liabilities | (6,730 | ) | ||
Due to seller | (804 | ) | ||
Net tangible and intangible assets | 116,476 | |||
Purchase price | 232,630 | |||
Goodwill | $ | 116,154 | ||
Goodwill deductible for tax purposes | $ | 115,532 | ||
|
|||
(In thousands) | 2017 | 2016 | ||||||
Billed receivables: | ||||||||
Trade and other receivables | $ | 363,234 | $ | 340,091 | ||||
Less: Allowance for doubtful accounts | (7,486 | ) | (4,832 | ) | ||||
Net billed receivables | 355,748 | 335,259 | ||||||
Unbilled receivables: | ||||||||
Recoverable costs and estimated earnings not billed | 160,727 | 149,847 | ||||||
Less: Progress payments applied | (21,552 | ) | (22,044 | ) | ||||
Net unbilled receivables | 139,175 | 127,803 | ||||||
Receivables, net | $ | 494,923 | $ | 463,062 | ||||
|
|||
(In thousands) | 2017 | 2016 | ||||||
Raw material | $ | 191,855 | $ | 189,228 | ||||
Work-in-process | 73,937 | 73,843 | ||||||
Finished goods | 114,307 | 112,478 | ||||||
Inventoried costs related to U.S. Government and other long-term contracts | 65,150 | 57,516 | ||||||
Gross inventories | 445,249 | 433,065 | ||||||
Less: Inventory reserves | (54,638 | ) | (54,988 | ) | ||||
Progress payments applied, principally related to long-term contracts | (11,745 | ) | (11,103 | ) | ||||
Inventories, net | $ | 378,866 | $ | 366,974 | ||||
|
|||
(In thousands) | 2017 | 2016 | ||||||
Land | $ | 19,947 | $ | 19,511 | ||||
Buildings and improvements | 234,539 | 215,221 | ||||||
Machinery, equipment, and other | 783,430 | 752,356 | ||||||
Property, plant, and equipment, at cost | 1,037,916 | 987,088 | ||||||
Less: Accumulated depreciation | (647,681 | ) | (598,185 | ) | ||||
Property, plant, and equipment, net | $ | 390,235 | $ | 388,903 | ||||
|
|||
(In thousands) | Commercial/Industrial | Defense | Power | Consolidated | ||||||||||||
December 31, 2015 | $ | 447,828 | $ | 337,603 | $ | 187,175 | $ | 972,606 | ||||||||
Divestitures | — | (452 | ) | — | (452 | ) | ||||||||||
Foreign currency translation adjustment | (11,687 | ) | (9,496 | ) | 86 | (21,097 | ) | |||||||||
December 31, 2016 | $ | 436,141 | $ | 327,655 | $ | 187,261 | $ | 951,057 | ||||||||
Acquisitions | 2,677 | 113,477 | 116,154 | |||||||||||||
Divestitures | (1,168 | ) | (647 | ) | (1,815 | ) | ||||||||||
Foreign currency translation adjustment | 10,881 | 19,847 | 205 | 30,933 | ||||||||||||
December 31, 2017 | $ | 448,531 | $ | 460,332 | $ | 187,466 | $ | 1,096,329 | ||||||||
|
|||
2017 | 2016 | |||||||||||||||||||||||
(In thousands) | Gross | Accumulated Amortization | Net | Gross | Accumulated Amortization | Net | ||||||||||||||||||
Technology | $ | 243,440 | $ | (114,036 | ) | $ | 129,404 | $ | 166,859 | $ | (98,266 | ) | $ | 68,593 | ||||||||||
Customer related intangibles | 367,230 | (180,580 | ) | 186,650 | 349,742 | (157,154 | ) | 192,588 | ||||||||||||||||
Other intangible assets | 40,640 | (27,026 | ) | 13,614 | 36,709 | (26,429 | ) | 10,280 | ||||||||||||||||
Total | $ | 651,310 | $ | (321,642 | ) | $ | 329,668 | $ | 553,310 | $ | (281,849 | ) | $ | 271,461 | ||||||||||
(In thousands) | ||||
2018 | $ | 38,159 | ||
2019 | 36,405 | |||
2020 | 34,440 | |||
2021 | 32,644 | |||
2022 | 30,085 | |||
|
|||
Gain/(Loss) on Swap | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Other income, net | ||||||||||||
Interest rate swaps | $ | — | $ | — | $ | 8,204 | ||||||
Hedged fixed rate debt | $ | — | $ | — | $ | (8,204 | ) | |||||
Total | $ | — | $ | — | $ | — | ||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Forward exchange contracts: | ||||||||||||
General and administrative expenses | $ | (346 | ) | $ | 11,510 | $ | 11,042 | |||||
|
|||
(In thousands) | 2017 | 2016 | ||||||
Accrued compensation | $ | 108,268 | $ | 85,970 | ||||
Accrued commissions | 6,296 | 5,189 | ||||||
Accrued interest | 9,894 | 9,817 | ||||||
Accrued insurance | 7,015 | 7,521 | ||||||
Other | 18,933 | 21,742 | ||||||
Total accrued expenses | $ | 150,406 | $ | 130,239 | ||||
(In thousands) | 2017 | 2016 | ||||||
Warranty reserves | $ | 14,212 | $ | 11,768 | ||||
Additional amounts due to sellers on acquisitions | 1,941 | 1,985 | ||||||
Reserves on loss contracts | 1,418 | 1,662 | ||||||
Pension and other postretirement liabilities | 5,060 | 5,331 | ||||||
Other | 13,179 | 7,281 | ||||||
Total other current liabilities | $ | 35,810 | $ | 28,027 | ||||
|
|||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Domestic | $ | 179,006 | $ | 154,571 | $ | 135,112 | ||||||
Foreign | 120,613 | 113,390 | 140,082 | |||||||||
$ | 299,619 | $ | 267,961 | $ | 275,194 | |||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Current: | ||||||||||||
Federal | $ | 54,963 | $ | 45,523 | $ | (6,741 | ) | |||||
State | 2,648 | 8,002 | 6,175 | |||||||||
Foreign | 23,162 | 20,861 | 27,134 | |||||||||
Total current | 80,773 | 74,386 | 26,568 | |||||||||
Deferred: | ||||||||||||
Federal | 2,595 | 4,267 | 49,060 | |||||||||
State | 4,282 | 73 | 7,390 | |||||||||
Foreign | (2,922 | ) | (147 | ) | (72 | ) | ||||||
Total deferred | 3,955 | 4,193 | 56,378 | |||||||||
Provision for income taxes | $ | 84,728 | $ | 78,579 | $ | 82,946 | ||||||
2017 | 2016 | 2015 | |||||||
U.S. federal statutory tax rate | 35.0 | % | 35.0 | % | 35.0 | % | |||
Add (deduct): | |||||||||
State and local taxes, net of federal benefit | 1.8 | 1.1 | 4.3 | ||||||
R&D tax credits | (1.3 | ) | (0.9 | ) | (1.3 | ) | |||
Foreign earnings (1) | (6.0 | ) | (5.8 | ) | (6.2 | ) | |||
Stock compensation - excess tax benefits | (2.6 | ) | — | — | |||||
Impacts related to the Tax Act | 3.4 | — | — | ||||||
All other, net | (2.0 | ) | (0.1 | ) | (1.7 | ) | |||
Effective tax rate | 28.3 | % | 29.3 | % | 30.1 | % | |||
(In thousands) | 2017 | 2016 | ||||||
Deferred tax assets: | ||||||||
Pension plans | $ | 18,903 | $ | 45,568 | ||||
Environmental reserves | 7,109 | 9,871 | ||||||
Inventories | 15,116 | 21,758 | ||||||
Postretirement/postemployment benefits | 8,241 | 13,542 | ||||||
Incentive compensation | 7,721 | 9,425 | ||||||
Net operating loss | 10,908 | 10,345 | ||||||
Capital loss carryover | 7,047 | 11,352 | ||||||
Other | 28,775 | 39,977 | ||||||
Total deferred tax assets | 103,820 | 161,838 | ||||||
Deferred tax liabilities: | ||||||||
Depreciation | 19,586 | 25,963 | ||||||
Goodwill amortization | 67,779 | 97,667 | ||||||
Other intangible amortization | 38,252 | 51,712 | ||||||
Other | 12,636 | 16,225 | ||||||
Total deferred tax liabilities | 138,253 | 191,567 | ||||||
Valuation allowance | 12,322 | 17,776 | ||||||
Net deferred tax liabilities | $ | 46,755 | $ | 47,505 | ||||
(In thousands) | 2017 | 2016 | ||||||
Net noncurrent deferred tax assets | 2,605 | 2,217 | ||||||
Net noncurrent deferred tax liabilities | 49,360 | 49,722 | ||||||
Net deferred tax liabilities | $ | 46,755 | $ | 47,505 | ||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Balance as of January 1, | $ | 11,454 | $ | 12,414 | $ | 11,560 | ||||||
Additions for tax positions of prior periods | 1,069 | 32 | 359 | |||||||||
Reductions for tax positions of prior periods | (194 | ) | (1,679 | ) | — | |||||||
Additions for tax positions related to the current year | 1,273 | 789 | 2,026 | |||||||||
Settlements | (428 | ) | (102 | ) | (1,414 | ) | ||||||
Foreign currency translation | — | — | (117 | ) | ||||||||
Balance as of December 31, | $ | 13,174 | $ | 11,454 | $ | 12,414 | ||||||
United States (Federal) | 2014 | - | present |
United States (Various states) | 2006 | - | present |
United Kingdom | 2010 | - | present |
Canada | 2011 | - | present |
|
|||
(In thousands) | 2017 | 2017 | 2016 | 2016 | ||||
Carrying Value | Estimated Fair Value | Carrying Value | Estimated Fair Value | |||||
5.51% Senior notes due 2017 | — | — | 150,000 | 154,509 | ||||
3.84% Senior notes due 2021 | 100,000 | 102,472 | 100,000 | 102,463 | ||||
3.70% Senior notes due 2023 | 225,000 | 228,783 | 225,000 | 226,946 | ||||
3.85% Senior notes due 2025 | 100,000 | 102,164 | 100,000 | 100,338 | ||||
4.24% Senior notes due 2026 | 200,000 | 208,873 | 200,000 | 203,592 | ||||
4.05% Senior notes due 2028 | 75,000 | 76,997 | 75,000 | 74,630 | ||||
4.11% Senior notes due 2028 | 100,000 | 103,226 | 100,000 | 99,876 | ||||
Other debt | 150 | 150 | 668 | 668 | ||||
Total debt | 800,150 | 822,665 | 950,668 | 963,022 | ||||
Debt issuance costs, net | (831) | (831) | (984) | (984) | ||||
Unamortized interest rate swap proceeds | 14,820 | 14,820 | 16,614 | 16,614 | ||||
Total debt, net | 814,139 | 836,654 | 966,298 | 978,652 | ||||
Less: current portion of long-term debt and short-term debt | 150 | 150 | 150,668 | 150,668 | ||||
Total long-term debt | $813,989 | $836,504 | $815,630 | $827,984 | ||||
(In thousands) | |||
2018 | $ | 150 | |
2019 | — | ||
2020 | — | ||
2021 | 100,000 | ||
2022 | — | ||
Thereafter | 700,000 | ||
Total | $ | 800,150 | |
|
|||
(In thousands, except per share data) | Earnings from continuing operations | Weighted- Average Shares Outstanding | Earnings per share from continuing operations | ||||||||
2017 | |||||||||||
Basic earnings per share from continuing operations | $ | 214,891 | 44,182 | $ | 4.86 | ||||||
Dilutive effect of stock options and deferred stock compensation | 579 | ||||||||||
Diluted earnings per share from continuing operations | $ | 214,891 | 44,761 | $ | 4.80 | ||||||
2016 | |||||||||||
Basic earnings per share from continuing operations | $ | 189,382 | 44,389 | $ | 4.27 | ||||||
Dilutive effect of stock options and deferred stock compensation | 656 | ||||||||||
Diluted earnings per share from continuing operations | $ | 189,382 | 45,045 | $ | 4.20 | ||||||
2015 | |||||||||||
Basic earnings per share from continuing operations | $ | 192,248 | 46,624 | $ | 4.12 | ||||||
Dilutive effect of stock options and deferred stock compensation | 992 | ||||||||||
Diluted earnings per share from continuing operations | $ | 192,248 | 47,616 | $ | 4.04 | ||||||
|
|||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Employee Stock Purchase Plan | 1,207 | 1,184 | 1,279 | |||||||||
Performance Share Units | 4,340 | 3,910 | 4,349 | |||||||||
Restricted Share Units | 4,931 | 3,426 | 3,015 | |||||||||
Other share-based payments | 1,094 | 958 | 830 | |||||||||
Total share-based compensation expense before income taxes | $ | 11,572 | $ | 9,478 | $ | 9,473 | ||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Cash received from share-based awards | $ | 14,179 | $ | 22,300 | $ | 28,706 | ||||||
Shares (000’s) | Weighted- Average Exercise Price | Weighted- Average Remaining Contractual Term in Years | Aggregate Intrinsic Value (000’s) | ||||||||||
Outstanding as of December 31, 2016 | 443 | $ | 31.91 | ||||||||||
Exercised | (179 | ) | 34.24 | ||||||||||
Outstanding as of December 31, 2017 | 264 | $ | 30.30 | 2.2 | $ | 24,093 | |||||||
Exercisable as of December 31, 2017 | 264 | $ | 30.30 | 2.2 | $ | 24,093 | |||||||
Performance Share Units (PSUs) | Restricted Share Units (RSUs) | |||||||||||||
Shares/Units (000’s) | Weighted- Average Fair Value | Shares/Units (000’s) | Weighted- Average Fair Value | |||||||||||
Nonvested as of December 31, 2016 | 204 | $ | 71.28 | 204 | $ | 74.38 | ||||||||
Granted | 68 | 62.91 | 1 | 98.34 | ||||||||||
Vested | (137 | ) | 62.91 | (34 | ) | 70.36 | ||||||||
Forfeited | — | — | (2 | ) | 85.47 | |||||||||
Nonvested as of December 31, 2017 | 135 | $ | 75.51 | 169 | $ | 75.19 | ||||||||
Expected to vest as of December 31, 2017 | 135 | $ | 75.51 | 169 | $ | 75.19 | ||||||||
|
|||
Asset Category | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
Cash and cash equivalents | $ | 23,979 | $ | 4,893 | $ | 19,086 | $ | — | ||||||||
Equity securities- Mutual funds (1) | 459,002 | 418,390 | 40,612 | — | ||||||||||||
Bond funds (2) | 219,249 | 155,120 | 64,129 | — | ||||||||||||
Insurance Contracts (3) | 10,760 | — | — | 10,760 | ||||||||||||
Other (4) | 1,618 | — | — | 1,618 | ||||||||||||
December 31, 2016 | $ | 714,608 | $ | 578,403 | $ | 123,827 | $ | 12,378 | ||||||||
Cash and cash equivalents | $ | 42,374 | $ | 12,551 | $ | 29,823 | $ | — | ||||||||
Equity securities- Mutual funds (1) | 504,633 | 455,175 | 49,458 | — | ||||||||||||
Bond funds (2) | 216,372 | 150,265 | 66,107 | — | ||||||||||||
Insurance Contracts (3) | 10,912 | — | — | 10,912 | ||||||||||||
Other (4) | 2,191 | — | — | 2,191 | ||||||||||||
December 31, 2017 | $ | 776,482 | $ | 617,991 | $ | 145,388 | $ | 13,103 | ||||||||
Pension Benefits | Postretirement Benefits | |||||||||||||||||||||||
(In thousands) | 2017 | 2016 | 2015 | 2017 | 2016 | 2015 | ||||||||||||||||||
Service cost | $ | 25,093 | $ | 25,100 | $ | 26,873 | $ | 435 | $ | 338 | $ | 286 | ||||||||||||
Interest cost | 25,895 | 30,495 | 30,050 | 762 | 996 | 842 | ||||||||||||||||||
Expected return on plan assets | (53,552 | ) | (54,101 | ) | (54,629 | ) | — | — | — | |||||||||||||||
Amortization of prior service cost | (100 | ) | (46 | ) | 618 | (656 | ) | (657 | ) | (657 | ) | |||||||||||||
Recognized net actuarial loss/(gain) | 12,925 | 12,029 | 16,890 | (223 | ) | (296 | ) | (551 | ) | |||||||||||||||
Cost of settlements/curtailments | 327 | — | 7,461 | — | — | — | ||||||||||||||||||
Net periodic benefit cost (income) | $ | 10,588 | $ | 13,477 | $ | 27,263 | $ | 318 | $ | 381 | $ | (80 | ) | |||||||||||
Pension Benefits | Postretirement Benefits | |||||||||||||||
(In thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Change in benefit obligation: | ||||||||||||||||
Beginning of year | $ | 798,605 | $ | 774,710 | $ | 24,436 | $ | 21,980 | ||||||||
Service cost | 25,093 | 25,100 | 435 | 338 | ||||||||||||
Interest cost | 25,895 | 30,495 | 762 | 996 | ||||||||||||
Plan participants’ contributions | 1,655 | 1,897 | 253 | 266 | ||||||||||||
Amendments | — | — | — | — | ||||||||||||
Actuarial loss | 56,727 | 19,640 | 2,056 | 3,372 | ||||||||||||
Benefits paid | (45,384 | ) | (41,115 | ) | (2,907 | ) | (2,516 | ) | ||||||||
Actual expenses | (1,301 | ) | (1,206 | ) | — | — | ||||||||||
Currency translation adjustments | 7,597 | (10,916 | ) | — | — | |||||||||||
End of year | $ | 868,887 | $ | 798,605 | $ | 25,035 | $ | 24,436 | ||||||||
Change in plan assets: | ||||||||||||||||
Beginning of year | $ | 714,608 | $ | 692,074 | $ | — | $ | — | ||||||||
Actual return on plan assets | 94,960 | 65,872 | — | — | ||||||||||||
Employer contribution | 4,561 | 8,210 | 2,654 | 2,250 | ||||||||||||
Plan participants’ contributions | 1,655 | 1,897 | 253 | 266 | ||||||||||||
Benefits paid | (45,384 | ) | (41,115 | ) | (2,907 | ) | (2,516 | ) | ||||||||
Actual Expenses | (1,301 | ) | (1,206 | ) | — | — | ||||||||||
Currency translation adjustments | 7,383 | (11,124 | ) | — | — | |||||||||||
End of year | $ | 776,482 | $ | 714,608 | $ | — | $ | — | ||||||||
Funded status | $ | (92,405 | ) | $ | (83,997 | ) | $ | (25,035 | ) | $ | (24,436 | ) | ||||
Pension Benefits | Postretirement Benefits | |||||||||||||||
(In thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Amounts recognized on the balance sheet | ||||||||||||||||
Noncurrent assets | $ | 8,663 | $ | 4,049 | $ | — | $ | — | ||||||||
Current liabilities | (3,374 | ) | (3,498 | ) | (1,686 | ) | (1,833 | ) | ||||||||
Noncurrent liabilities | (97,694 | ) | (84,548 | ) | (23,349 | ) | (22,603 | ) | ||||||||
Total | $ | (92,405 | ) | $ | (83,997 | ) | $ | (25,035 | ) | $ | (24,436 | ) | ||||
Amounts recognized in accumulated other comprehensive income (AOCI) | ||||||||||||||||
Net actuarial loss (gain) | $ | 201,390 | $ | 198,630 | $ | (2,899 | ) | $ | (5,178 | ) | ||||||
Prior service cost | (1,461 | ) | (1,580 | ) | (2,718 | ) | (3,373 | ) | ||||||||
Total | $ | 199,929 | $ | 197,050 | $ | (5,617 | ) | $ | (8,551 | ) | ||||||
Amounts in AOCI expected to be recognized in net periodic cost in the coming year: | ||||||||||||||||
Loss (gain) recognition | $ | 15,615 | $ | 11,793 | $ | (29 | ) | $ | (203 | ) | ||||||
Prior service cost recognition | $ | (250 | ) | $ | (105 | ) | $ | (657 | ) | $ | (657 | ) | ||||
Accumulated benefit obligation | $ | 834,745 | $ | 767,461 | N/A | N/A | ||||||||||
Information for pension plans with an accumulated benefit obligation in excess of plan assets: | ||||||||||||||||
Projected benefit obligation | $ | 785,039 | $ | 733,426 | N/A | N/A | ||||||||||
Accumulated benefit obligation | 752,371 | 702,282 | N/A | N/A | ||||||||||||
Fair value of plan assets | 684,756 | 645,380 | N/A | N/A | ||||||||||||
Pension Benefits | Postretirement Benefits | |||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||
Weighted-average assumptions in determination of benefit obligation: | ||||||||||||
Discount rate | 3.46 | % | 3.88 | % | 3.54 | % | 4.00 | % | ||||
Rate of compensation increase | 3.55 | % | 3.35 | % | N/A | N/A | ||||||
Health care cost trends: | ||||||||||||
Rate assumed for subsequent year | N/A | N/A | 8.30 | % | 8.25 | % | ||||||
Ultimate rate reached in 2026 | N/A | N/A | 4.50 | % | 4.50 | % | ||||||
Weighted-average assumptions in determination of net periodic benefit cost: | ||||||||||||
Discount rate | 3.93 | % | 4.12 | % | 4.02 | % | 4.25 | % | ||||
Expected return on plan assets | 7.47 | % | 7.81 | % | N/A | N/A | ||||||
Rate of compensation increase | 3.54 | % | 3.35 | % | N/A | N/A | ||||||
Health care cost trends: | ||||||||||||
Rate assumed for subsequent year | N/A | N/A | 8.25 | % | 8.75 | % | ||||||
Ultimate rate reached in 2026 | N/A | N/A | 4.50 | % | 4.50 | % | ||||||
(In thousands) | 1% Increase | 1% Decrease | ||||||
Total service and interest cost components | $ | 28 | $ | (23 | ) | |||
Postretirement benefit obligation | $ | 502 | $ | (414 | ) | |||
As of December 31, | Target | Expected | ||||||
2017 | 2016 | Exposure | Range | |||||
Asset class | ||||||||
Domestic equities | 52% | 54% | 50% | 40%-60% | ||||
International equities | 15% | 13% | 15% | 10%-20% | ||||
Total equity | 67% | 67% | 65% | 55%-75% | ||||
Fixed income | 33% | 33% | 35% | 25%-45% | ||||
(In thousands) | Pension Plans | Postretirement Plans | Total | |||||||||
2018 | $ | 45,604 | $ | 1,686 | $ | 47,290 | ||||||
2019 | 48,937 | 1,693 | 50,630 | |||||||||
2020 | 49,859 | 1,694 | 51,553 | |||||||||
2021 | 51,058 | 1,689 | 52,747 | |||||||||
2022 | 50,361 | 1,678 | 52,039 | |||||||||
2023 — 2027 | 266,582 | 8,030 | 274,612 | |||||||||
(In thousands) | Insurance Contracts | Other | Total | |||||||||
December 31, 2015 | $ | 9,720 | $ | 755 | $ | 10,475 | ||||||
Actual return on plan assets: | ||||||||||||
Relating to assets still held at the reporting date | 148 | 35 | 183 | |||||||||
Purchases, sales, and settlements | 1,095 | 871 | 1,966 | |||||||||
Foreign currency translation adjustment | (203 | ) | (43 | ) | (246 | ) | ||||||
December 31, 2016 | $ | 10,760 | $ | 1,618 | $ | 12,378 | ||||||
Actual return on plan assets: | ||||||||||||
Relating to assets still held at the reporting date | 167 | 58 | 226 | |||||||||
Purchases, sales, and settlements | (503 | ) | 436 | (68 | ) | |||||||
Foreign currency translation adjustment | 488 | 79 | 567 | |||||||||
December 31, 2017 | $ | 10,912 | $ | 2,191 | $ | 13,103 | ||||||
|
|||
(In thousands) | Rental Commitments | ||
2018 | $ | 28,284 | |
2019 | 24,378 | ||
2020 | 21,733 | ||
2021 | 17,577 | ||
2022 | 14,253 | ||
Thereafter | 73,870 | ||
Total | $ | 180,095 | |
|
|||
Capital expenditures | ||||||||||||
Commercial/Industrial | $ | 29,028 | $ | 30,145 | $ | 21,990 | ||||||
Defense | 9,276 | 5,870 | 3,834 | |||||||||
Power | 10,039 | 6,653 | 6,163 | |||||||||
Corporate | 4,362 | 4,108 | 3,525 | |||||||||
Total Consolidated (2) | $ | 52,705 | $ | 46,776 | $ | 35,512 | ||||||
Year Ended December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Earnings before taxes: | ||||||||||||
Total segment operating income | $ | 362,943 | $ | 331,313 | $ | 345,407 | ||||||
Corporate and Eliminations | (23,200 | ) | (23,215 | ) | (34,790 | ) | ||||||
Interest expense | 41,471 | 41,248 | 36,038 | |||||||||
Other income, net | 1,347 | 1,111 | 615 | |||||||||
Total consolidated earnings before tax | $ | 299,619 | $ | 267,961 | $ | 275,194 | ||||||
Depreciation and amortization expense | ||||||||||||
Commercial/Industrial | $ | 53,180 | $ | 53,970 | $ | 55,799 | ||||||
Defense | 20,702 | 14,488 | 15,965 | |||||||||
Power | 22,019 | 23,032 | 23,419 | |||||||||
Corporate | 4,094 | 4,518 | 4,292 | |||||||||
Total Consolidated | $ | 99,995 | $ | 96,008 | $ | 99,475 | ||||||
Year Ended December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Net sales | ||||||||||||
Commercial/Industrial | $ | 1,163,510 | $ | 1,120,326 | $ | 1,189,120 | ||||||
Defense | 557,954 | 469,796 | 479,528 | |||||||||
Power | 554,048 | 524,967 | 545,013 | |||||||||
Less: Intersegment Revenues | (4,486 | ) | (6,158 | ) | (7,978 | ) | ||||||
Total Consolidated | $ | 2,271,026 | $ | 2,108,931 | $ | 2,205,683 | ||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Operating income (expense) | ||||||||||||
Commercial/Industrial | $ | 168,328 | $ | 156,550 | $ | 171,525 | ||||||
Defense | 109,355 | 98,291 | 98,895 | |||||||||
Power | 85,260 | 76,472 | 74,987 | |||||||||
Corporate and Eliminations (1) | (23,200 | ) | (23,215 | ) | (34,790 | ) | ||||||
Total Consolidated | $ | 339,743 | $ | 308,098 | $ | 310,617 | ||||||
Segment assets | ||||||||||||
Commercial/Industrial | $ | 1,444,097 | $ | 1,391,040 | $ | 1,480,052 | ||||||
Defense | 1,044,776 | 751,859 | 800,613 | |||||||||
Power | 482,753 | 516,321 | 629,612 | |||||||||
Corporate | 264,695 | 378,561 | 79,334 | |||||||||
Total Consolidated | $ | 3,236,321 | $ | 3,037,781 | $ | 2,989,611 | ||||||
As of December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Assets: | ||||||||||||
Total assets for reportable segments | $ | 2,971,626 | $ | 2,659,220 | $ | 2,910,277 | ||||||
Non-segment cash | 204,664 | 357,021 | 42,164 | |||||||||
Other assets | 60,031 | 21,540 | 37,170 | |||||||||
Total consolidated assets | $ | 3,236,321 | $ | 3,037,781 | $ | 2,989,611 | ||||||
Year Ended December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Revenues | ||||||||||||
United States of America | $ | 1,562,180 | $ | 1,472,241 | $ | 1,502,363 | ||||||
United Kingdom | 118,350 | 114,752 | 135,673 | |||||||||
Other foreign countries | 590,496 | 521,938 | 567,647 | |||||||||
Consolidated total | $ | 2,271,026 | $ | 2,108,931 | $ | 2,205,683 | ||||||
As of December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Long-Lived Assets | ||||||||||||
United States of America | $ | 264,829 | $ | 272,826 | $ | 293,612 | ||||||
United Kingdom | 41,100 | 39,014 | 36,061 | |||||||||
Other foreign countries | 84,306 | 77,063 | 83,971 | |||||||||
Consolidated total | $ | 390,235 | $ | 388,903 | $ | 413,644 | ||||||
Year Ended December 31, | ||||||||||||
(In thousands) | 2017 | 2016 | 2015 | |||||||||
Net sales | ||||||||||||
Flow Control | $ | 899,705 | $ | 883,735 | $ | 949,657 | ||||||
Motion Control | 1,075,218 | 940,162 | 947,758 | |||||||||
Surface Technologies | 296,103 | 285,034 | 308,268 | |||||||||
Consolidated total | $ | 2,271,026 | $ | 2,108,931 | $ | 2,205,683 | ||||||
|
|||
(In thousands) | Foreign currency translation adjustments, net | Total pension and postretirement adjustments, net | Accumulated other comprehensive income (loss) | |||||||||
December 31, 2015 | $ | (107,810 | ) | $ | (118,118 | ) | $ | (225,928 | ) | |||
Other comprehensive loss before reclassifications (1) | (64,840 | ) | (7,892 | ) | (72,732 | ) | ||||||
Amounts reclassified from accumulated other comprehensive income (1) | — | 6,904 | 6,904 | |||||||||
Net current period other comprehensive loss | (64,840 | ) | (988 | ) | (65,828 | ) | ||||||
December 31, 2016 | $ | (172,650 | ) | $ | (119,106 | ) | $ | (291,756 | ) | |||
Other comprehensive loss before reclassifications (1) | 77,942 | (10,831 | ) | 67,111 | ||||||||
Amounts reclassified from accumulated other comprehensive income (1) | — | 7,805 | 7,805 | |||||||||
Net current period other comprehensive income (loss) | 77,942 | (3,026 | ) | 74,916 | ||||||||
December 31, 2017 | $ | (94,708 | ) | $ | (122,132 | ) | $ | (216,840 | ) | |||
Amount reclassified from Accumulated other comprehensive income (loss) | Affected line item in the statement where net earnings is presented | |||||||||
(In thousands) | 2017 | 2016 | ||||||||
Defined benefit pension and postretirement plans | ||||||||||
Amortization of prior service costs | 756 | 703 | (1) | |||||||
Amortization of net actuarial losses | (12,702 | ) | (11,733 | ) | (1) | |||||
Settlements | (327 | ) | — | (1) | ||||||
(12,273 | ) | (11,030 | ) | Total before tax | ||||||
4,468 | 4,126 | Income tax effect | ||||||||
Total reclassifications | $ | (7,805 | ) | $ | (6,904 | ) | Net of tax | |||
|
|||
(In thousands, except per share data) | First | Second | Third | Fourth | ||||||||||||
2017 | ||||||||||||||||
Net sales | $ | 523,591 | $ | 567,653 | $ | 567,901 | $ | 611,881 | ||||||||
Gross profit | 170,775 | 198,770 | 210,783 | 238,267 | ||||||||||||
Earnings from continuing operations | 32,547 | 50,650 | 63,944 | 67,750 | ||||||||||||
Loss from discontinued operations | — | — | — | — | ||||||||||||
Net earnings | 32,547 | 50,650 | 63,944 | 67,750 | ||||||||||||
Basic earnings per share | ||||||||||||||||
Earnings from continuing operations | $ | 0.74 | $ | 1.15 | $ | 1.45 | $ | 1.54 | ||||||||
Loss from discontinued operations | $ | — | $ | — | $ | — | $ | — | ||||||||
Total | $ | 0.74 | $ | 1.15 | $ | 1.45 | $ | 1.54 | ||||||||
Diluted earnings per share | ||||||||||||||||
Earnings from continuing operations | $ | 0.73 | $ | 1.13 | $ | 1.43 | $ | 1.52 | ||||||||
Loss from discontinued operations | $ | — | $ | — | $ | — | $ | — | ||||||||
Total | $ | 0.73 | $ | 1.13 | $ | 1.43 | $ | 1.52 | ||||||||
2016 | ||||||||||||||||
Net sales | $ | 503,507 | $ | 532,766 | $ | 507,092 | $ | 565,566 | ||||||||
Gross profit | 171,903 | 185,379 | 184,476 | 208,725 | ||||||||||||
Earnings from continuing operations | 32,819 | 39,963 | 45,932 | 70,668 | ||||||||||||
Loss from discontinued operations | — | — | — | (2,053 | ) | |||||||||||
Net earnings | 32,819 | 39,963 | 45,932 | 68,615 | ||||||||||||
Basic earnings per share | ||||||||||||||||
Earnings from continuing operations | $ | 0.74 | $ | 0.90 | $ | 1.04 | $ | 1.60 | ||||||||
Loss from discontinued operations | — | — | — | (0.05 | ) | |||||||||||
Total | $ | 0.74 | $ | 0.90 | $ | 1.04 | $ | 1.55 | ||||||||
Diluted earnings per share | ||||||||||||||||
Earnings from continuing operations | $ | 0.73 | $ | 0.88 | $ | 1.02 | $ | 1.58 | ||||||||
Loss from discontinued operations | — | — | — | (0.05 | ) | |||||||||||
Total | $ | 0.73 | $ | 0.88 | $ | 1.02 | $ | 1.53 | ||||||||
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Additions | ||||||||||||||||||||||||
Description | Balance at Beginning of Period | Charged to Costs and Expenses | Charged to Other Accounts | Deductions | Balance at End of Period | |||||||||||||||||||
Deducted from assets to which they apply: | ||||||||||||||||||||||||
December 31, 2017 | ||||||||||||||||||||||||
Tax valuation allowance | 17,776 | 1,471 | 125 | (1) | 7,050 | (3) | 12,322 | |||||||||||||||||
Total | $ | 17,776 | $ | 1,471 | $ | 125 | $ | 7,050 | $ | 12,322 | ||||||||||||||
December 31, 2016 | ||||||||||||||||||||||||
Tax valuation allowance | 17,895 | 1,951 | (181 | ) | (1) | 1,889 | (2) | 17,776 | ||||||||||||||||
Total | $ | 17,895 | $ | 1,951 | $ | (181 | ) | $ | 1,889 | $ | 17,776 | |||||||||||||
December 31, 2015 | ||||||||||||||||||||||||
Tax valuation allowance | 23,478 | 2,605 | (299 | ) | (1) | 7,889 | 17,895 | |||||||||||||||||
Total | $ | 23,478 | $ | 2,605 | $ | (299 | ) | $ | 7,889 | $ | 17,895 | |||||||||||||
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