BARNES GROUP INC, 10-Q filed on 7/28/2015
Quarterly Report
Document and Entity Information
6 Months Ended
Jun. 30, 2015
Jul. 21, 2015
Document and Entity Information [Abstract]
 
 
Document Type
10-Q 
 
Amendment Flag
false 
 
Document Period End Date
Jun. 30, 2015 
 
Document Fiscal Year Focus
2015 
 
Document Fiscal Period Focus
Q2 
 
Entity Registrant Name
BARNES GROUP INC 
 
Entity Central Index Key
0000009984 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Large Accelerated Filer 
 
Entity Common Stock, Shares Outstanding
 
54,694,464 
Consolidated Statements of Income (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2015
Jun. 30, 2014
Jun. 30, 2015
Jun. 30, 2014
Income Statement [Abstract]
 
 
 
 
Net sales
$ 314,941 
$ 322,074 
$ 615,515 
$ 634,173 
Cost of sales
204,121 
211,705 
402,477 
426,261 
Selling and administrative expenses
60,171 
64,988 
118,494 
127,406 
Total operating costs and expenses
264,292 
276,693 
520,971 
553,667 
Operating income
50,649 
45,381 
94,544 
80,506 
Interest expense
2,586 
2,804 
5,306 
6,123 
Other expense (income), net
237 
792 
318 
1,027 
Income before income taxes
47,826 
41,785 
88,920 
73,356 
Income taxes
13,599 
11,557 
25,617 
20,375 
Net income
$ 34,227 
$ 30,228 
$ 63,303 
$ 52,981 
Per common share:
 
 
 
 
Basic (in dollars per share)
$ 0.62 
$ 0.55 
$ 1.15 
$ 0.97 
Diluted (in dollars per share)
$ 0.61 
$ 0.54 
$ 1.14 
$ 0.95 
Dividends (in dollars per share)
$ 0.12 
$ 0.11 
$ 0.24 
$ 0.22 
Weighted average common shares outstanding:
 
 
 
 
Basic (in shares)
55,134,890 
54,740,750 
55,111,019 
54,695,865 
Diluted (in shares)
55,695,258 
55,927,881 
55,677,166 
55,950,467 
Consolidated Statements of Comprehensive Income (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2015
Jun. 30, 2014
Jun. 30, 2015
Jun. 30, 2014
Statement of Comprehensive Income [Abstract]
 
 
 
 
Net income
$ 34,227 
$ 30,228 
$ 63,303 
$ 52,981 
Other comprehensive income (loss), net of tax
 
 
 
 
Unrealized gain (loss) on hedging activities, net of tax (1)
189 1
(502)1
301 1
(529)1
Foreign currency translation adjustments, net of tax (2)
23,632 2
(4,612)2
(16,125)2
(10,560)2
Defined benefit pension and other postretirement benefits, net of tax (3)
1,790 3
1,489 3
5,451 3
(4,381)3
Total other comprehensive income (loss), net of tax
25,611 
(3,625)
(10,373)
(15,470)
Total comprehensive income
59,838 
26,603 
52,930 
37,511 
Unrealized (loss) income on hedging activities, tax
73 
(208)
32 
(194)
Foreign currency translation adjustment, tax
830 
(569)
(1,381)
(767)
Defined benefit pension and other postretirement benefits, tax
$ 1,421 
$ 797 
$ 2,767 
$ (2,990)
Consolidated Balance Sheets (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2015
Dec. 31, 2014
Current assets
 
 
Cash and cash equivalents
$ 81,967 
$ 46,039 
Accounts receivable, less allowances (2015 - $3,502; 2014 - $3,873)
283,918 
275,890 
Inventories
210,302 
212,044 
Deferred income taxes
27,628 
31,849 
Prepaid expenses and other current assets
32,027 
22,574 
Total current assets
635,842 
588,396 
Deferred income taxes
8,961 
10,061 
Property, plant and equipment
683,138 
672,225 
Less accumulated depreciation
(385,080)
(372,790)
Property, plant and equipment, net
298,058 
299,435 
Goodwill
583,448 
594,949 
Other intangible assets, net
523,898 
554,694 
Other assets
28,436 
26,350 
Total assets
2,078,643 
2,073,885 
Current liabilities
 
 
Notes and overdrafts payable
21,789 
8,028 
Accounts payable
107,030 
94,803 
Accrued liabilities
123,003 
161,397 
Long-term debt - current
824 
862 
Total current liabilities
252,646 
265,090 
Long-term debt
474,730 
495,844 
Accrued retirement benefits
110,241 
115,057 
Deferred income taxes
66,198 
70,147 
Other liabilities
19,648 
15,954 
Commitments and contingencies (Note 13)
   
   
Stockholders' equity
 
 
Common stock - par value $0.01 per share Authorized: 150,000,000 shares Issued: at par value (2015 - 61,744,866 shares; 2014 - 61,229,980 shares)
617 
612 
Additional paid-in capital
421,519 
405,525 
Treasury stock, at cost (2015 - 7,035,647 shares; 2014 - 6,729,438 shares)
(181,617)
(169,405)
Retained earnings
1,024,487 
974,514 
Accumulated other non-owner changes to equity
(109,826)
(99,453)
Total stockholders' equity
1,155,180 
1,111,793 
Total liabilities and stockholders' equity
$ 2,078,643 
$ 2,073,885 
Consolidated Balance Sheets (Parenthetical) (USD $)
In Thousands, except Share data, unless otherwise specified
Jun. 30, 2015
Dec. 31, 2014
Allowance for doubtful accounts
$ 3,502 
$ 3,873 
Common stock, par value (in dollars per share)
$ 0.01 
$ 0.01 
Common stock, shares authorized (in shares)
150,000,000 
150,000,000 
Common stock, shares issued (in shares)
61,744,866 
61,229,980 
Treasury stock, at cost (in shares)
7,035,647 
6,729,438 
Consolidated Statements of Cash Flows (USD $)
In Thousands, unless otherwise specified
6 Months Ended
Jun. 30, 2015
Jun. 30, 2014
Operating activities:
 
 
Net income
$ 63,303 
$ 52,981 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
Depreciation and amortization
39,642 
42,515 
Amortization of convertible debt discount
731 
(Gain) loss on disposition of property, plant and equipment
(1,302)
78 
Stock compensation expense
4,890 
4,108 
Withholding taxes paid on stock issuances
(746)
(806)
Changes in assets and liabilities:
 
 
Accounts receivable
(8,902)
(39,359)
Inventories
(2,768)
(6,409)
Prepaid expenses and other current assets
(10,448)
(3,204)
Accounts payable
14,742 
12,796 
Accrued liabilities
(14,202)
2,934 
Deferred income taxes
629 
1,307 
Long-term retirement benefits
(745)
(4,326)
Other
1,818 
1,567 
Net cash provided by operating activities
85,911 
64,913 
Investing activities:
 
 
Proceeds from disposition of property, plant and equipment
2,058 
474 
Payments for the sale of businesses
(1,181)
Capital expenditures
(22,376)
(25,802)
Component Repair Program payments
(19,000)
(41,000)
Other
(651)
(858)
Net cash used by investing activities
(39,969)
(68,367)
Financing activities:
 
 
Net change in other borrowings
13,738 
11,186 
Payments on long-term debt
(85,821)
(78,467)
Proceeds from the issuance of long-term debt
68,722 
90,383 
Payment of assumed liability to Otto Männer Holding AG
(19,796)
Proceeds from the issuance of common stock
9,691 
9,395 
Common stock repurchases
(11,465)
(8,389)
Dividends paid
(13,126)
(11,937)
Excess tax benefit on stock awards
1,574 
2,671 
Other
8,487 
(137)
Net cash used by financing activities
(8,200)
(5,091)
Effect of exchange rate changes on cash flows
(1,814)
(71)
Increase (decrease) in cash and cash equivalents
35,928 
(8,616)
Cash and cash equivalents at beginning of period
46,039 
70,856 
Cash and cash equivalents at end of period
81,967 
62,240 
Intangible assets acquired
 
$ 39,000 
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies

The accompanying unaudited consolidated balance sheet and the related unaudited consolidated statements of income, comprehensive income and cash flows have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The consolidated financial statements do not include all information and notes required by accounting principles generally accepted in the United States of America for complete financial statements. The balance sheet as of December 31, 2014 has been derived from the 2014 financial statements of Barnes Group Inc. (the “Company”). For additional information, please refer to the consolidated financial statements and notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014. In the opinion of management, all adjustments, including normal recurring accruals considered necessary for a fair statement of the results, have been included. Operating results for the six-month period ended June 30, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015.
Net Income Per Common Share
Net Income Per Common Share
Net Income Per Common Share

For the purpose of computing diluted net income per common share, the weighted-average number of common shares outstanding is increased for the potential dilutive effects of stock-based incentive plans and convertible senior subordinated notes. For the purpose of computing diluted net income per common share, the weighted-average number of common shares outstanding was increased by 560,368 and 1,187,131 for the three-month periods ended June 30, 2015 and 2014, respectively, and 566,147 and 1,254,602 for the six-month periods ended June 30, 2015 and 2014, respectively, to account for the potential dilutive effect of stock-based incentive plans and the Company's 3.375% Senior Subordinated Convertible Notes (the "3.375% Notes"). The decrease in the dilutive effect of potentially issuable shares was due primarily to the redemption of the 3.375% Notes, which occurred during 2014. There were no adjustments to net income for the purposes of computing income available to common stockholders for those periods.

The calculation of weighted-average diluted shares outstanding excludes all shares that would have been anti-dilutive. During the three-month periods ended June 30, 2015 and 2014, the Company excluded 199,950 and 92,049 stock options, respectively, from the calculation of weighted average diluted shares outstanding as the stock options would have been anti-dilutive. During the six-month periods ended June 30, 2015 and 2014, the Company excluded 199,950 and 92,049 stock options, respectively, from the calculation of weighted average diluted shares outstanding as the stock options would have been anti-dilutive.
  
The Company granted 122,700 stock options, 106,685 restricted stock unit awards and 85,465 performance share awards in February 2015 as part of its annual grant awards. All of the stock options and the restricted stock unit awards vest upon meeting certain service conditions. The restricted stock unit awards are included in basic weighted average common shares outstanding as they contain nonforfeitable rights to dividend payments. The performance share awards are part of a long-term incentive program and are based on performance goals that are driven by three independently measured metrics: the Company's total shareholder return ("TSR"), return on invested capital ("ROIC") and operating income before depreciation and amortization growth (each metric weighted equally). The TSR and operating income before depreciation and amortization growth metrics are designed to assess the Company's performance relative to the performance of companies included in the Russell 2000 Index over the three-year term of the program ending December 31, 2017. The ROIC metric is measured based on pre-established Company targets over the same period. The participants can earn from zero to 250% of the target award and the award includes a forfeitable right to dividend equivalents, which are not included in the aggregate target award numbers. The fair value of the TSR portion of the performance share awards was determined using a Monte Carlo valuation method as the award contains a market condition.
Inventories
Inventories
Inventories

The components of inventories consisted of:
 
June 30, 2015
 
December 31, 2014
Finished goods
$
78,817


$
83,905

Work-in-process
80,485

 
79,563

Raw material and supplies
51,000

 
48,576

 
$
210,302


$
212,044

Goodwill and Other Intangible Assets
Goodwill and Other Intangible Assets
Goodwill and Other Intangible Assets

Goodwill:
The following table sets forth the change in the carrying amount of goodwill for each reportable segment and for the Company as of and for the period ended June 30, 2015:
 
Industrial
 
Aerospace
 
Total Company
January 1, 2015
$
564,163

 
$
30,786

 
$
594,949

Foreign currency translation
(11,501
)
 

 
(11,501
)
June 30, 2015
$
552,662

 
$
30,786

 
$
583,448



In the second quarter of 2015, management performed its annual impairment testing of goodwill. Based on this assessment, there was no goodwill impairment through June 30, 2015.

Other Intangible Assets:
Other intangible assets consisted of:
 
 
 
June 30, 2015
 
December 31, 2014
 
Range of
Life -Years
 
Gross Amount
 
Accumulated Amortization
 
Gross Amount
 
Accumulated Amortization
Amortized intangible assets:
 
 
 
 
 
 
 
 
 
Revenue sharing programs (RSPs)
Up to 30
 
$
293,700

 
$
(78,820
)
 
$
293,700

 
$
(72,958
)
Component repair programs (CRPs)
Up to 30
 
106,639

 
(4,003
)
 
106,639

 
(1,941
)
Customer lists/relationships
10-16
 
183,406

 
(36,116
)
 
183,406

 
(30,731
)
Patents and technology
7-14
 
62,972

 
(25,834
)
 
62,972

 
(22,356
)
Trademarks/trade names
10-30
 
11,950

 
(9,008
)
 
11,950

 
(8,552
)
Other
Up to 15
 
19,292

 
(16,997
)
 
19,292

 
(14,806
)
 
 
 
677,959

 
(170,778
)
 
677,959

 
(151,344
)
Unamortized intangible asset:
 
 
 
 
 
 
 
 
 
Trade names
 
 
36,900

 

 
36,900

 

Foreign currency translation
 
 
(20,183
)
 

 
(8,821
)
 

Other intangible assets
 
 
$
694,676

 
$
(170,778
)
 
$
706,038

 
$
(151,344
)


Estimated amortization of intangible assets for future periods is as follows: 2015 - $39,000; 2016 - $35,000; 2017 - $35,000; 2018 - $36,000 and 2019 - $33,000.

During the second quarter of 2015, the Company changed its annual impairment testing of its trade names, indefinite-lived intangible assets, from July 1 to April 1. The Company believes this timing is preferable as it better aligns with its annual testing of goodwill impairment. The Company completed its annual testing in the second quarter of 2015 and determined that there were no impairments through June 30, 2015.

In June 2014, the Company entered into a Component Repair Program ("CRP") with its customer, General Electric ("GE"). This CRP provides for, among other items, the right to sell certain aftermarket component repair services for CFM56 engines directly to other customers as one of a few GE licensed suppliers. In addition, this CRP extends existing contracts under which the Company currently provides these services directly to GE. As consideration for these rights, the Company agreed to pay $80,000. The Company paid $61,000 during 2014 and $19,000 during the second quarter of 2015. The length of the program rights are for the remaining life of all CFM56 engine lines and the amortization of the intangible will be recognized as a reduction to sales over this life.
Debt
Debt
Debt

The Company's debt agreements contain financial covenants that require the maintenance of interest coverage and leverage ratios. The Company is in compliance with its financial covenants as of June 30, 2015, and continues to monitor its future compliance based on current and anticipated future economic conditions.

Long-term debt and notes and overdrafts payable at June 30, 2015 and December 31, 2014 consisted of:
 
 
June 30, 2015
 
December 31, 2014
 
 
Carrying
Amount
 
Fair
Value
 
Carrying
Amount
 
Fair
Value
Revolving credit agreement
 
$
373,000

 
$
373,219

 
$
393,518

 
$
394,917

3.97% Senior Notes
 
100,000

 
101,892

 
100,000

 
102,859

Borrowings under lines of credit and overdrafts
 
21,789

 
21,789

 
8,028

 
8,028

Capital leases
 
2,554

 
2,758

 
3,188

 
3,479

 
 
497,343

 
499,658

 
504,734

 
509,283

Less current maturities
 
(22,613
)
 
 
 
(8,890
)
 
 
Long-term debt
 
$
474,730

 
 
 
$
495,844

 
 

In September 2013, the Company entered into a second amendment to its fifth amended and restated revolving credit agreement (the "Amended Credit Agreement") and retained Bank of America, N.A. as the administrative agent for the lenders. The $750,000 Amended Credit Agreement matures in September 2018 with an option to extend the maturity date for an additional year, subject to certain conditions. The Amended Credit Agreement adds a new foreign subsidiary borrower in Germany, Barnes Group Acquisition GmbH, and includes an accordion feature to increase the borrowing availability of the Company to $1,000,000. The Company may exercise the accordion feature upon request to the Administrative Agent as long as an event of default has not occurred or is continuing. The borrowing availability of $750,000, pursuant to the terms of the Amended Credit Agreement, allows for Euro-denominated borrowings equivalent to $500,000. Borrowings under the Amended Credit Agreement bear interest at LIBOR plus a spread ranging from 1.10% to 1.70% depending on the Company's leverage ratio at prior quarter end.

Borrowings and availability under the Amended Credit Agreement were $373,000 and $377,000, respectively, at June 30, 2015 and $393,518 and $356,482, respectively, at December 31, 2014. Borrowings included Euro-denominated borrowings of €30,945 ($37,618) at December 31, 2014. The interest rate on these borrowings was 1.29% and 1.33% on June 30, 2015 and December 31, 2014, respectively. The fair value of the borrowings is based on observable Level 2 inputs. The borrowings are valued using discounted cash flows based upon the Company's estimated interest costs for similar types of borrowings.

On October 15, 2014, the Company entered into a Note Purchase Agreement (“Note Purchase Agreement”), among the Company and New York Life Insurance Company, New York Life Insurance and Annuity Corporation and New York Life Insurance and Annuity Corporation Institutionally Owned Life Insurance Separate Account (BOLI 30C), as purchasers, for the issuance of $100,000 aggregate principal amount of 3.97% senior notes due October 17, 2024 (the “3.97% Senior Notes”). The Company completed funding of the transaction and issued the 3.97% Senior Notes on October 17, 2014.

The 3.97% Senior Notes are senior unsecured obligations of the Company and will pay interest semi-annually on April 17 and October 17 of each year at an annual rate of 3.97%. The 3.97% Senior Notes will mature on October 17, 2024 unless earlier prepaid in accordance with their terms. Subject to certain conditions, the Company may, at its option, prepay all or any part of the 3.97% Senior Notes in an amount equal to 100% of the principal amount of the 3.97% Senior Notes so prepaid, plus any accrued and unpaid interest to the date of prepayment, plus the Make-Whole Amount, as defined in the Note Purchase Agreement, with respect to such principal amount being prepaid. The fair value of the 3.97% Senior Notes was determined using the US Treasury yield and a long-term credit spread for similar types of borrowings, that represent Level 2 observable inputs.
The Note Purchase Agreement contains customary affirmative and negative covenants, including, among others, limitations on indebtedness, liens, investments, restricted payments, dispositions and business activities. The Note Purchase Agreement also requires the Company to maintain a ratio of Consolidated Senior Debt, as defined, to Consolidated EBITDA, as defined, of not more than 3.25 times at the end of each fiscal quarter, provided that such ratio may increase to 3.50 times following the consummation of certain acquisitions. In addition, the Note Purchase Agreement requires the Company to maintain (i) a ratio of Consolidated Total Debt, as defined, to Consolidated EBITDA of not more than 4.00 times at the end of each fiscal quarter, provided that such ratio may increase to 4.25 times following the consummation of certain acquisitions, and (ii) a ratio of Consolidated EBITDA to Consolidated Cash Interest Expense, as defined, of not less than 4.25 times at the end of any fiscal quarter.

In addition, the Company has available approximately $56,000 in uncommitted short-term bank credit lines ("Credit Lines") and overdraft facilities. Under the Credit Lines, $20,900 was borrowed at June 30, 2015 at an interest rate of 1.19% and $7,550 was borrowed at December 31, 2014 at an interest rate of 1.23%. The Company had also borrowed $889 and $478 under the overdraft facilities at June 30, 2015 and December 31, 2014, respectively. Repayments under the Credit Lines are due within a month after being borrowed. Repayments of the overdrafts are generally due within two days after being borrowed. The carrying amounts of the Credit Lines and overdrafts approximate fair value due to the short maturities of these financial instruments.

The Company holds certain capital leases at June 30, 2015 and at December 31, 2014. The fair value of the capital leases are based on observable Level 2 inputs. These instruments are valued using discounted cash flows based upon the Company's estimated interest costs for similar types of borrowings.
Business Reorganization
Business Reorganization
Business Reorganization

The Company authorized the closure of production operations ("Saline operations") at its Associated Spring facility located in Saline, Michigan (the "Closure") during the first quarter of 2014.  The Saline operations, which included approximately 50 employees, primarily manufactured certain automotive engine valve springs, a highly commoditized product. Based on changing market dynamics and increased customer demands for commodity pricing, several customers advised the Company of their intent to transition these specific springs to other suppliers, which led to the decision of the Closure. The Closure occurred during the second quarter of 2014, however certain other facility Closure costs, including the transfer of machinery and equipment, continued during the remainder of 2014. The Company recorded restructure and related costs of $5,052 during the first half of 2014. This balance included $2,112 of employee termination costs, primarily employee severance expense and defined benefit pension and other postretirement plans (the "Plans") costs related to the accelerated recognition of actuarial losses and special termination benefits, and $2,940 of other facility costs, primarily related to asset write-downs and depreciation on assets that had been utilized through the Closure. See Note 9 for costs associated with the Plans that were impacted by the Closure during the first half of 2014. The Closure was completed as of December 31, 2014. Closure costs were recorded primarily within Cost of Sales in the accompanying Consolidated Statements of Income and are reflected in the results of the Industrial segment.
Derivatives
Derivatives
Derivatives

The Company has manufacturing, sales and distribution facilities around the world and thus makes investments and conducts business transactions denominated in various currencies. The Company is also exposed to fluctuations in interest rates and commodity price changes. These financial exposures are monitored and managed by the Company as an integral part of its risk management program.

Financial instruments have been used by the Company to hedge its exposure to fluctuations in interest rates. In 2012, the Company entered into five-year interest rate swap agreements transacted with three banks which together convert the interest on the first $100,000 of the Company's one-month LIBOR-based borrowings from a variable rate plus the borrowing spread to a fixed rate of 1.03% plus the borrowing spread. These interest rate swap agreements were accounted for as cash flow hedges.

The Company also uses financial instruments to hedge its exposures to fluctuations in foreign currency exchange rates. The Company has various contracts outstanding which primarily hedge recognized assets or liabilities, and anticipated transactions in various currencies including the Euro, British pound sterling, U.S. dollar, Japanese yen, Singapore dollar, Swedish kroner and Swiss franc. Certain foreign currency derivative instruments are treated as cash flow hedges of forecasted transactions.  All foreign exchange contracts are due within two years.

The Company does not use derivatives for speculative or trading purposes or to manage commodity exposures.
Changes in the fair market value of derivatives that qualify as fair value hedges or cash flow hedges are recorded directly to earnings or accumulated other non-owner changes to equity, depending on the designation. Amounts recorded to accumulated other non-owner changes to equity are reclassified to earnings in a manner that matches the earnings impact of the hedged transaction. Any ineffective portion, or amounts related to contracts that are not designated as hedges, are recorded directly to earnings.

The Company's policy for classifying cash flows from derivatives is to report the cash flows consistent with the underlying hedged item. Other financing cash flows during the first half of 2015, as presented on the consolidated statements of cash flows, include $8,695 of net cash proceeds from the settlement of foreign currency hedges related to intercompany financing.

The following table sets forth the fair value amounts of derivative instruments held by the Company.
 
June 30, 2015
 
December 31, 2014
 
Asset Derivatives
 
Liability Derivatives
 
Asset Derivatives
 
Liability Derivatives
Derivatives designated as hedging instruments:
 
 
 
 
 
 
 
Interest rate contracts
$

 
$
(564
)
 
$

 
$
(295
)
Foreign exchange contracts

 
(50
)
 

 
(652
)
 
 
 
 
 
 
 
 
Derivatives not designated as hedging instruments:
 
 
 
 
 
 
 
Foreign exchange contracts
399

 
(781
)
 
460

 
(699
)
Total derivatives
$
399

 
$
(1,395
)
 
$
460

 
$
(1,646
)


Asset derivatives are recorded in prepaid expenses and other current assets in the accompanying consolidated balance sheets. Liability derivatives related to interest rate contracts and foreign exchange contracts are recorded in other liabilities and accrued liabilities, respectively, in the accompanying consolidated balance sheets.

The following table sets forth the gain (loss), net of tax, recorded in accumulated other non-owner changes to equity for the three- and six- month periods ended June 30, 2015 and 2014 for derivatives held by the Company and designated as hedging instruments.
 
Three months ended June 30,
 
Six months ended June 30,
 
2015
 
2014
 
2015
 
2014
Cash flow hedges:
 
 
 
 
 
 
 
Interest rate contracts
$
63

 
$
(213
)
 
$
(169
)
 
$
(142
)
Foreign exchange contracts
126

 
(289
)
 
470

 
(387
)
 
$
189

 
$
(502
)
 
$
301

 
$
(529
)


Amounts related to the interest rate swaps included within accumulated other non-owner changes to equity that were reclassified to expense during the first half of 2015 and 2014 resulted in a fixed rate of interest of 1.03% plus the borrowing spread for the first $100,000 of one-month LIBOR borrowings. Additionally, there were no amounts recognized in income for hedge ineffectiveness during the three- and six- month periods ended June 30, 2015 and 2014.

The following table sets forth the net gain (loss) recorded in other expense (income), net in the consolidated statements of income for the three- and six- month periods ended June 30, 2015 and 2014 for non-designated derivatives held by the Company. Such amounts were substantially offset by the net loss (gain) recorded on the underlying hedged asset or liability, also recorded in other expense (income), net.
 
Three months ended June 30,
 
Six months ended June 30,
 
2015
 
2014
 
2015
 
2014
Foreign exchange contracts
$
(1,671
)
 
$
(241
)
 
$
6,945

 
$
(988
)
Fair Value Measurements
Fair Value Measurements
Fair Value Measurements

The provisions of the accounting standard for fair value define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This standard classifies the inputs used to measure fair value into the following hierarchy:

Level 1
Unadjusted quoted prices in active markets for identical assets or liabilities

Level 2
Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability

Level 3
Unobservable inputs for the asset or liability

The following table provides the financial assets and financial liabilities reported at fair value and measured on a recurring basis:
 
 
 
 
Fair Value Measurements Using
Description
 
Total
 
Quoted Prices in Active Markets for
Identical Assets
(Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
June 30, 2015
 
 
 
 
 
 
 
 
Asset derivatives
 
$
399

 
$

 
$
399

 
$

Liability derivatives
 
(1,395
)
 

 
(1,395
)
 

Bank acceptances
 
16,785

 

 
16,785

 

Rabbi trust assets
 
2,259

 
2,259

 

 

 
 
$
18,048

 
$
2,259

 
$
15,789

 
$

 
 
 
 
 
 
 
 
 
December 31, 2014
 
 
 
 
 
 
 
 
Asset derivatives
 
$
460

 
$

 
$
460

 
$

Liability derivatives
 
(1,646
)
 

 
(1,646
)
 

Bank acceptances
 
10,785

 

 
10,785

 

Rabbi trust assets
 
2,092

 
2,092

 

 

 
 
$
11,691


$
2,092

 
$
9,599

 
$



The derivative contracts are valued using observable current market information as of the reporting date such as the prevailing LIBOR-based and U.S. treasury interest rates and foreign currency spot and forward rates. Bank acceptances represent financial instruments accepted from certain Chinese customers in lieu of cash paid on receivables, generally range from three to six months in maturity and are guaranteed by banks. The carrying amounts of the bank acceptances, which are included within prepaid expenses and other current assets, approximate fair value due to their short maturities. The fair values of rabbi trust assets are based on quoted market prices from various financial exchanges.
Pension and Other Postretirement Benefits
Pension and Other Postretirement Benefits
Curtailment losses and special termination benefits during the first half of 2014 relate to certain defined benefit pension and other postretirement benefit plans that were impacted by the closure of production operations at an Associated Spring facility located in Saline, Michigan. The settlement loss during the first half of 2014 reflects payments that were made to certain participants within one of the Company's defined benefit pension plans.
Income Taxes
Income Taxes
Income Taxes

The Company's effective tax rate from continuing operations for the first half of 2015 was 28.8% compared with 27.8% in the first half of 2014 and 27.6% for the full year 2014. The increase in the first half of 2015 effective tax rate from the full year 2014 rate is primarily due to the expiration of certain tax holidays.

The Aerospace and Industrial segments were previously awarded international tax holidays. The tax holidays awarded to Industrial have expired. The remaining tax holidays for which the Company currently receives benefit relate to Aerospace, the majority of which are due to expire in 2015 through 2016.
Changes in Accumulated Other Comprehensive Income by Component
Changes in Accumulated Other Comprehensive Income by Component
Changes in Accumulated Other Comprehensive Income by Component

The following table sets forth the changes in accumulated other comprehensive income, net of tax, by component for the six- month periods ended June 30, 2015 and 2014:
 
Gains and Losses on Cash Flow Hedges
 
Pension and Other Postretirement Benefit Items
 
Foreign Currency Items
 
Total
January 1, 2015
$
(732
)
 
$
(115,289
)
 
$
16,568

 
$
(99,453
)
Other comprehensive (loss) income before reclassifications to consolidated statements of income
(249
)
 
355

 
(16,125
)
 
(16,019
)
Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income
550

 
5,096

 

 
5,646

Net current-period other comprehensive income (loss)
301

 
5,451

 
(16,125
)
 
(10,373
)
June 30, 2015
$
(431
)
 
$
(109,838
)
 
$
443

 
$
(109,826
)


 
Gains and Losses on Cash Flow Hedges
 
Pension and Other Postretirement Benefit Items
 
Foreign Currency Items
 
Total
January 1, 2014
$
(519
)
 
$
(73,273
)
 
$
99,736

 
$
25,944

Other comprehensive loss before reclassifications to consolidated statements of income
(820
)
 
(8,133
)
 
(10,560
)
 
(19,513
)
Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income
291

 
3,752

 

 
4,043

Net current-period other comprehensive loss
(529
)
 
(4,381
)
 
(10,560
)
 
(15,470
)
June 30, 2014
$
(1,048
)
 
$
(77,654
)
 
$
89,176

 
$
10,474



The following table sets forth the reclassifications out of accumulated other comprehensive income by component for the three-and six- month periods ended June 30, 2015 and 2014:

Details about Accumulated Other Comprehensive Income Components
 
Amount Reclassified from Accumulated Other Comprehensive Income
Affected Line Item in the Consolidated Statements of Income
 
 
Three months ended June 30, 2015
 
Three months ended June 30, 2014
 
 
Gains and losses on cash flow hedges
 
 
 
 
 
 
     Interest rate contracts
 
$
(214
)
 
$
(222
)
 
Interest expense
     Foreign exchange contracts
 
(116
)
 
(42
)
 
Net sales
 
 
(330
)
 
(264
)
 
Total before tax
 
 
106

 
92

 
Tax benefit
 
 
(224
)
 
(172
)
 
Net of tax
 
 
 
 
 
 
 
Pension and other postretirement benefit items
 
 
 
 
 
 
     Amortization of prior-service credits, net
 
$
64

 
$
61

 
(A)
Amortization of actuarial losses
 
(4,300
)
 
(2,537
)
 
(A)
Settlement loss
 

 
(582
)
 
(A)
 
 
(4,236
)
 
(3,058
)
 
Total before tax
 
 
1,421

 
855

 
Tax benefit
 
 
(2,815
)
 
(2,203
)
 
Net of tax
 
 
 
 
 
 
 
Total reclassifications in the period
 
$
(3,039
)
 
$
(2,375
)
 
 
(A) These accumulated other comprehensive income components are included within the computation of net periodic pension cost. See Note 9.

Details about Accumulated Other Comprehensive Income Components
 
Amount Reclassified from Accumulated Other Comprehensive Income
Affected Line Item in the Consolidated Statements of Income
 
 
Six months ended June 30, 2015
 
Six months ended June 30, 2014
 
 
Gains and losses on cash flow hedges
 
 
 
 
 

     Interest rate contracts
 
$
(429
)
 
$
(439
)
 
Interest expense
     Foreign exchange contracts
 
(360
)
 
(20
)
 
Net sales
 
 
(789
)
 
(459
)
 
Total before tax
 
 
239

 
168

 
Tax benefit
 
 
(550
)
 
(291
)
 
Net of tax
 
 
 
 
 
 
 
Pension and other postretirement benefit items
 
 
 
 
 
 
     Amortization of prior-service credits, net
 
$
127

 
$
101

 
(A)
Amortization of actuarial losses
 
(7,990
)
 
(4,715
)
 
(A)
Curtailment loss
 

 
(223
)
 
(A)
Settlement loss
 

 
(582
)
 
(A)
 
 
(7,863
)
 
(5,419
)
 
Total before tax
 
 
2,767

 
1,667

 
Tax benefit
 
 
(5,096
)
 
(3,752
)
 
Net of tax
 
 
 
 
 
 
 
Total reclassifications in the period
 
$
(5,646
)
 
$
(4,043
)
 
 

(A) These accumulated other comprehensive income components are included within the computation of net periodic pension cost. See Note 9.
Information on Business Segments
Information on Business Segments
Information on Business Segments

The Company is organized based upon the nature of its products and services and reports under two global business segments: Industrial and Aerospace. Segment information is consistent with how management reviews the businesses, makes investing and resource allocation decisions and assesses operating performance. The Company has not aggregated operating segments for purposes of identifying these two reportable segments.

The Industrial segment is a global manufacturer of highly-engineered, high-quality precision parts, products and systems for critical applications serving a diverse customer base in end-markets such as transportation, industrial equipment, consumer products, packaging, electronics, medical devices, and energy. Focused on innovative custom solutions, Industrial participates in the design phase of components and assemblies whereby the customers receive the benefits of application and systems engineering, new product development, testing and evaluation, and the manufacturing of final products. Industrial designs and manufactures customized hot runner systems and precision mold assemblies - the enabling technologies for many complex injection molding applications. It is a leading manufacturer and supplier of precision mechanical products, including precision mechanical springs and nitrogen gas products. Industrial also manufactures high-precision punched and fine-blanked components used in transportation and industrial applications, nitrogen gas springs and manifold systems used to precisely control stamping presses, and retention rings that position parts on a shaft or other axis. Industrial is equipped to produce virtually every type of precision spring, from fine hairsprings for electronics and instruments to large heavy-duty springs for machinery.

The Aerospace segment produces precision-machined and fabricated components and assemblies for original equipment manufacturer ("OEM") turbine engine, airframe and industrial gas turbine builders throughout the world, and the military. Aerospace Aftermarket provides jet engine component overhaul and repair ("MRO") services, including the CRP's, for many of the world's major turbine engine manufacturers, commercial airlines and militaries. Aerospace Aftermarket activities also include the manufacture and delivery of spare parts, including the RSPs under which the Company receives an exclusive right to supply designated aftermarket parts over the life of the related aircraft engine program, and component repairs.

The following tables set forth information about the Company's operations by its two reportable segments:
 
Three months ended June 30,
 
Six months ended June 30,
 
2015
 
2014
 
2015
 
2014
Net sales
 
 
 
 
 
 
 
   Industrial
$
202,589

 
$
212,768

 
$
402,938

 
$
416,656

   Aerospace
112,356

 
109,310

 
212,581

 
217,521

   Intersegment sales
(4
)
 
(4
)
 
(4
)
 
(4
)
Total net sales
$
314,941

 
$
322,074

 
$
615,515

 
$
634,173

 
 
 
 
 
 
 
 
Operating profit
 
 
 
 
 
 
 
   Industrial
$
29,979

 
$
28,765

 
$
60,958

 
$
48,140

   Aerospace
20,670

 
16,616

 
33,586

 
32,366

Total operating profit
50,649

 
45,381

 
94,544

 
80,506

   Interest expense
2,586

 
2,804

 
5,306

 
6,123

   Other expense (income), net
237

 
792

 
318

 
1,027

Income before income taxes
$
47,826

 
$
41,785

 
$
88,920

 
$
73,356



 
June 30, 2015
 
December 31, 2014
Assets
 
 
 
   Industrial
$
1,251,669

 
$
1,281,974

   Aerospace
655,806

 
655,042

   Other (A)
171,168

 
136,869

Total assets
$
2,078,643

 
$
2,073,885


(A) "Other" assets include corporate-controlled assets, the majority of which are cash and deferred tax assets.
Commitments and Contingencies
Commitments and Contingencies
Commitments and Contingencies

Product Warranties

The Company provides product warranties in connection with the sale of certain products. From time to time, the Company is subject to customer claims with respect to product warranties. Product warranty liabilities were not material as of June 30, 2015 and December 31, 2014.
Subsequent Event Subsequent Event
Subsequent Event
Subsequent Event

On July 20, 2015, the Company, through one of its subsidiaries (the “Purchaser”), entered into a Sale and Purchase Agreement (the "SPA") with the three shareholders of privately held HPE S.p.A. (collectively, the “Seller”) for the acquisition (the “Acquisition”) of all of the shares of capital stock of HPE S.p.A. through which Seller owns and operates its Thermoplay business ("Thermoplay”). Thermoplay’s headquarters and manufacturing facility are located in Pont-Saint-Martin in Aosta, Italy, with technical service capabilities in China, India, France, Germany, United Kingdom, Portugal, and Brazil. Thermoplay specializes in the design, development, and manufacturing of hot runner solutions for plastic injection molding, primarily in the packaging, automotive, and medical end markets. The purchase price payable by the Purchaser for the Acquisition under the terms of the SPA is €50 million in cash, subject to certain adjustments in connection with the closing. The closing of the Acquisition is subject to the satisfaction of certain closing conditions, and is currently expected to occur in August 2015. The Company expects to finance the transaction with cash on hand and borrowings under the Company’s revolving credit facility. Following the closing, Thermoplay will operate as a business unit within the Company’s Industrial segment.
Inventories (Tables)
Schedule of Inventory
The components of inventories consisted of:
 
June 30, 2015
 
December 31, 2014
Finished goods
$
78,817


$
83,905

Work-in-process
80,485

 
79,563

Raw material and supplies
51,000

 
48,576

 
$
210,302


$
212,044

Goodwill and Other Intangible Assets (Tables)
The following table sets forth the change in the carrying amount of goodwill for each reportable segment and for the Company as of and for the period ended June 30, 2015:
 
Industrial
 
Aerospace
 
Total Company
January 1, 2015
$
564,163

 
$
30,786

 
$
594,949

Foreign currency translation
(11,501
)
 

 
(11,501
)
June 30, 2015
$
552,662

 
$
30,786

 
$
583,448

Other intangible assets consisted of:
 
 
 
June 30, 2015
 
December 31, 2014
 
Range of
Life -Years
 
Gross Amount
 
Accumulated Amortization
 
Gross Amount
 
Accumulated Amortization
Amortized intangible assets:
 
 
 
 
 
 
 
 
 
Revenue sharing programs (RSPs)
Up to 30
 
$
293,700

 
$
(78,820
)
 
$
293,700

 
$
(72,958
)
Component repair programs (CRPs)
Up to 30
 
106,639

 
(4,003
)
 
106,639

 
(1,941
)
Customer lists/relationships
10-16
 
183,406

 
(36,116
)
 
183,406

 
(30,731
)
Patents and technology
7-14
 
62,972

 
(25,834
)
 
62,972

 
(22,356
)
Trademarks/trade names
10-30
 
11,950

 
(9,008
)
 
11,950

 
(8,552
)
Other
Up to 15
 
19,292

 
(16,997
)
 
19,292

 
(14,806
)
 
 
 
677,959

 
(170,778
)
 
677,959

 
(151,344
)
Unamortized intangible asset:
 
 
 
 
 
 
 
 
 
Trade names
 
 
36,900

 

 
36,900

 

Foreign currency translation
 
 
(20,183
)
 

 
(8,821
)
 

Other intangible assets
 
 
$
694,676

 
$
(170,778
)
 
$
706,038

 
$
(151,344
)
Debt (Tables)
Schedule of Debt
Long-term debt and notes and overdrafts payable at June 30, 2015 and December 31, 2014 consisted of:
 
 
June 30, 2015
 
December 31, 2014
 
 
Carrying
Amount
 
Fair
Value
 
Carrying
Amount
 
Fair
Value
Revolving credit agreement
 
$
373,000

 
$
373,219

 
$
393,518

 
$
394,917

3.97% Senior Notes
 
100,000

 
101,892

 
100,000

 
102,859

Borrowings under lines of credit and overdrafts
 
21,789

 
21,789

 
8,028

 
8,028

Capital leases
 
2,554

 
2,758

 
3,188

 
3,479

 
 
497,343

 
499,658

 
504,734

 
509,283

Less current maturities
 
(22,613
)
 
 
 
(8,890
)
 
 
Long-term debt
 
$
474,730

 
 
 
$
495,844

 
 
Derivatives (Tables)
The following table sets forth the net gain (loss) recorded in other expense (income), net in the consolidated statements of income for the three- and six- month periods ended June 30, 2015 and 2014 for non-designated derivatives held by the Company. Such amounts were substantially offset by the net loss (gain) recorded on the underlying hedged asset or liability, also recorded in other expense (income), net.
 
Three months ended June 30,
 
Six months ended June 30,
 
2015
 
2014
 
2015
 
2014
Foreign exchange contracts
$
(1,671
)
 
$
(241
)
 
$
6,945

 
$
(988
)
The following table sets forth the gain (loss), net of tax, recorded in accumulated other non-owner changes to equity for the three- and six- month periods ended June 30, 2015 and 2014 for derivatives held by the Company and designated as hedging instruments.
 
Three months ended June 30,
 
Six months ended June 30,
 
2015
 
2014
 
2015
 
2014
Cash flow hedges:
 
 
 
 
 
 
 
Interest rate contracts
$
63

 
$
(213
)
 
$
(169
)
 
$
(142
)
Foreign exchange contracts
126

 
(289
)
 
470

 
(387
)
 
$
189

 
$
(502
)
 
$
301

 
$
(529
)
The following table sets forth the fair value amounts of derivative instruments held by the Company.
 
June 30, 2015
 
December 31, 2014
 
Asset Derivatives
 
Liability Derivatives
 
Asset Derivatives
 
Liability Derivatives
Derivatives designated as hedging instruments:
 
 
 
 
 
 
 
Interest rate contracts
$

 
$
(564
)
 
$

 
$
(295
)
Foreign exchange contracts

 
(50
)
 

 
(652
)
 
 
 
 
 
 
 
 
Derivatives not designated as hedging instruments:
 
 
 
 
 
 
 
Foreign exchange contracts
399

 
(781
)
 
460

 
(699
)
Total derivatives
$
399

 
$
(1,395
)
 
$
460

 
$
(1,646
)
Fair Value Measurements (Tables)
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis
The following table provides the financial assets and financial liabilities reported at fair value and measured on a recurring basis:
 
 
 
 
Fair Value Measurements Using
Description
 
Total
 
Quoted Prices in Active Markets for
Identical Assets
(Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
June 30, 2015
 
 
 
 
 
 
 
 
Asset derivatives
 
$
399

 
$

 
$
399

 
$

Liability derivatives
 
(1,395
)
 

 
(1,395
)
 

Bank acceptances
 
16,785

 

 
16,785

 

Rabbi trust assets
 
2,259

 
2,259

 

 

 
 
$
18,048

 
$
2,259

 
$
15,789

 
$

 
 
 
 
 
 
 
 
 
December 31, 2014
 
 
 
 
 
 
 
 
Asset derivatives
 
$
460

 
$

 
$
460

 
$

Liability derivatives
 
(1,646
)
 

 
(1,646
)
 

Bank acceptances
 
10,785

 

 
10,785

 

Rabbi trust assets
 
2,092

 
2,092

 

 

 
 
$
11,691


$
2,092

 
$
9,599

 
$

Pension and Other Postretirement Benefits (Tables)
Schedule of Net Benefit Costs
Pension and other postretirement benefits expenses consisted of the following:
 
Three months ended June 30,
 
Six months ended June 30,
Pensions
2015
 
2014
 
2015
 
2014
Service cost
$
1,299

 
$
1,052

 
$
2,752

 
$
2,307

Interest cost
5,297

 
5,540

 
9,992

 
10,978

Expected return on plan assets
(8,589
)
 
(8,483
)
 
(16,159
)
 
(17,053
)
Amortization of prior service cost
77

 
157

 
155

 
334

Amortization of actuarial losses
4,056

 
2,270

 
7,485

 
4,232

Curtailment loss

 

 

 
219

Settlement loss

 
582

 

 
582

Special termination benefits

 

 

 
715

Net periodic benefit cost
$
2,140

 
$
1,118

 
$
4,225

 
$
2,314

 
 
 
 
 
 
 
 

 
Three months ended June 30,
 
Six months ended June 30,
Other Postretirement Benefits
2015
 
2014
 
2015
 
2014
Service cost
$
36

 
$
29

 
$
73

 
$
81

Interest cost
425

 
540

 
918

 
1,099

Amortization of prior service credit
(141
)
 
(218
)
 
(282
)
 
(435
)
Amortization of actuarial losses
244

 
267

 
505

 
483

Curtailment loss

 

 

 
4

Net periodic benefit cost
$
564

 
$
618

 
$
1,214

 
$
1,232

Changes in Accumulated Other Comprehensive Income by Component (Tables)
The following table sets forth the changes in accumulated other comprehensive income, net of tax, by component for the six- month periods ended June 30, 2015 and 2014:
 
Gains and Losses on Cash Flow Hedges
 
Pension and Other Postretirement Benefit Items
 
Foreign Currency Items
 
Total
January 1, 2015
$
(732
)
 
$
(115,289
)
 
$
16,568

 
$
(99,453
)
Other comprehensive (loss) income before reclassifications to consolidated statements of income
(249
)
 
355

 
(16,125
)
 
(16,019
)
Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income
550

 
5,096

 

 
5,646

Net current-period other comprehensive income (loss)
301

 
5,451

 
(16,125
)
 
(10,373
)
June 30, 2015
$
(431
)
 
$
(109,838
)
 
$
443

 
$
(109,826
)


 
Gains and Losses on Cash Flow Hedges
 
Pension and Other Postretirement Benefit Items
 
Foreign Currency Items
 
Total
January 1, 2014
$
(519
)
 
$
(73,273
)
 
$
99,736

 
$
25,944

Other comprehensive loss before reclassifications to consolidated statements of income
(820
)
 
(8,133
)
 
(10,560
)
 
(19,513
)
Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income
291

 
3,752

 

 
4,043

Net current-period other comprehensive loss
(529
)
 
(4,381
)
 
(10,560
)
 
(15,470
)
June 30, 2014
$
(1,048
)
 
$
(77,654
)
 
$
89,176

 
$
10,474

The following table sets forth the reclassifications out of accumulated other comprehensive income by component for the three-and six- month periods ended June 30, 2015 and 2014:

Details about Accumulated Other Comprehensive Income Components
 
Amount Reclassified from Accumulated Other Comprehensive Income
Affected Line Item in the Consolidated Statements of Income
 
 
Three months ended June 30, 2015
 
Three months ended June 30, 2014
 
 
Gains and losses on cash flow hedges
 
 
 
 
 
 
     Interest rate contracts
 
$
(214
)
 
$
(222
)
 
Interest expense
     Foreign exchange contracts
 
(116
)
 
(42
)
 
Net sales
 
 
(330
)
 
(264
)
 
Total before tax
 
 
106

 
92

 
Tax benefit
 
 
(224
)
 
(172
)
 
Net of tax
 
 
 
 
 
 
 
Pension and other postretirement benefit items
 
 
 
 
 
 
     Amortization of prior-service credits, net
 
$
64

 
$
61

 
(A)
Amortization of actuarial losses
 
(4,300
)
 
(2,537
)
 
(A)
Settlement loss
 

 
(582
)
 
(A)
 
 
(4,236
)
 
(3,058
)
 
Total before tax
 
 
1,421

 
855

 
Tax benefit
 
 
(2,815
)
 
(2,203
)
 
Net of tax
 
 
 
 
 
 
 
Total reclassifications in the period
 
$
(3,039
)
 
$
(2,375
)
 
 
(A) These accumulated other comprehensive income components are included within the computation of net periodic pension cost. See Note 9.

Details about Accumulated Other Comprehensive Income Components
 
Amount Reclassified from Accumulated Other Comprehensive Income
Affected Line Item in the Consolidated Statements of Income
 
 
Six months ended June 30, 2015
 
Six months ended June 30, 2014
 
 
Gains and losses on cash flow hedges
 
 
 
 
 

     Interest rate contracts
 
$
(429
)
 
$
(439
)
 
Interest expense
     Foreign exchange contracts
 
(360
)
 
(20
)
 
Net sales
 
 
(789
)
 
(459
)
 
Total before tax
 
 
239

 
168

 
Tax benefit
 
 
(550
)
 
(291
)
 
Net of tax
 
 
 
 
 
 
 
Pension and other postretirement benefit items
 
 
 
 
 
 
     Amortization of prior-service credits, net
 
$
127

 
$
101

 
(A)
Amortization of actuarial losses
 
(7,990
)
 
(4,715
)
 
(A)
Curtailment loss
 

 
(223
)
 
(A)
Settlement loss
 

 
(582
)
 
(A)
 
 
(7,863
)
 
(5,419
)
 
Total before tax
 
 
2,767

 
1,667

 
Tax benefit
 
 
(5,096
)
 
(3,752
)
 
Net of tax
 
 
 
 
 
 
 
Total reclassifications in the period
 
$
(5,646
)
 
$
(4,043
)
 
 

(A) These accumulated other comprehensive income components are included within the computation of net periodic pension cost. See Note 9.
Information on Business Segments (Tables)
Schedule of Segment Reporting Information, by Segment
The following tables set forth information about the Company's operations by its two reportable segments:
 
Three months ended June 30,
 
Six months ended June 30,
 
2015
 
2014
 
2015
 
2014
Net sales
 
 
 
 
 
 
 
   Industrial
$
202,589

 
$
212,768

 
$
402,938

 
$
416,656

   Aerospace
112,356

 
109,310

 
212,581

 
217,521

   Intersegment sales
(4
)
 
(4
)
 
(4
)
 
(4
)
Total net sales
$
314,941

 
$
322,074

 
$
615,515

 
$
634,173

 
 
 
 
 
 
 
 
Operating profit
 
 
 
 
 
 
 
   Industrial
$
29,979

 
$
28,765

 
$
60,958

 
$
48,140

   Aerospace
20,670

 
16,616

 
33,586

 
32,366

Total operating profit
50,649

 
45,381

 
94,544

 
80,506

   Interest expense
2,586

 
2,804

 
5,306

 
6,123

   Other expense (income), net
237

 
792

 
318

 
1,027

Income before income taxes
$
47,826

 
$
41,785

 
$
88,920

 
$
73,356



 
June 30, 2015
 
December 31, 2014
Assets
 
 
 
   Industrial
$
1,251,669

 
$
1,281,974

   Aerospace
655,806

 
655,042

   Other (A)
171,168

 
136,869

Total assets
$
2,078,643

 
$
2,073,885


(A) "Other" assets include corporate-controlled assets, the majority of which are cash and deferred tax assets.
Net Income Per Common Share (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
1 Months Ended 3 Months Ended 6 Months Ended
Feb. 28, 2013
Jun. 30, 2015
Jun. 30, 2014
Jun. 30, 2015
Jun. 30, 2014
Net Income Per Common Share [Line Items]
 
 
 
 
 
Weighted average number of diluted shares outstanding adjustment (in shares)
 
560,368 
1,187,131 
566,147 
1,254,602 
Adjustments to net income for purposes of computing income available to common stockholders
 
$ 0 
$ 0 
$ 0 
$ 0 
Stock Options [Member]
 
 
 
 
 
Net Income Per Common Share [Line Items]
 
 
 
 
 
Antidilutive securities excluded from computation of EPS
 
199,950 
92,049 
199,950 
92,049 
Options, granted (in shares)
122,700 
 
 
 
 
Restricted Stock Units (RSUs) [Member]
 
 
 
 
 
Net Income Per Common Share [Line Items]
 
 
 
 
 
Other than options, granted (in shares)
106,685 
 
 
 
 
Performance Share Awards [Member]
 
 
 
 
 
Net Income Per Common Share [Line Items]
 
 
 
 
 
Other than options, granted (in shares)
85,465 
 
 
 
 
Award vesting period
 
 
 
3 years 
 
Minimum range of target award of stock plan
 
 
 
0.00% 
 
Maximum range of target award of stock plan
 
 
 
250.00% 
 
Inventories (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2015
Dec. 31, 2014
Inventory Disclosure [Abstract]
 
 
Finished goods
$ 78,817 
$ 83,905 
Work-in-process
80,485 
79,563 
Raw material and supplies
51,000 
48,576 
Inventories
$ 210,302 
$ 212,044 
Goodwill and Other Intangible Assets (Details) (USD $)
3 Months Ended 6 Months Ended 12 Months Ended
Jun. 30, 2015
Jun. 30, 2015
Jun. 30, 2014
Dec. 31, 2014
Goodwill:
 
 
 
 
Goodwill impairment
 
$ 0 
 
 
Goodwill, beginning of period
 
594,949,000 
 
 
Foreign currency translation
 
(11,501,000)
 
 
Goodwill, end of period
583,448,000 
583,448,000 
 
594,949,000 
Other Intangible Assets:
 
 
 
 
Gross Amount
677,959,000 
677,959,000 
 
677,959,000 
Accumulated Amortization
(170,778,000)
(170,778,000)
 
(151,344,000)
Foreign currency translation
(20,183,000)
(20,183,000)
 
(8,821,000)
Other intangible assets
694,676,000 
694,676,000 
 
706,038,000 
Intangible Assets, Future Amortization Expense
 
 
 
 
Amortization of intangible assets expected in 2015
39,000,000 
39,000,000 
 
 
Amortization of intangible assets expected in 2016
35,000,000 
35,000,000 
 
 
Amortization of intangible assets expected in 2017
35,000,000 
35,000,000 
 
 
Amortization of intangible assets expected in 2018
36,000,000 
36,000,000 
 
 
Amortization of intangible assets expected in 2019
33,000,000 
33,000,000 
 
 
Component Repair Program payments consideration
 
 
80,000,000 
 
Component Repair Program payments
19,000,000 
19,000,000 
41,000,000 
61,000,000 
Trade name [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Unamortized intangible asset
36,900,000 
36,900,000 
 
36,900,000 
Revenue sharing programs (RSPs) [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Gross Amount
293,700,000 
293,700,000 
 
293,700,000 
Accumulated Amortization
(78,820,000)
(78,820,000)
 
(72,958,000)
Component repair programs (CRPs) [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Gross Amount
106,639,000 
106,639,000 
 
106,639,000 
Accumulated Amortization
(4,003,000)
(4,003,000)
 
(1,941,000)
Customer lists/relationships [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Gross Amount
183,406,000 
183,406,000 
 
183,406,000 
Accumulated Amortization
(36,116,000)
(36,116,000)
 
(30,731,000)
Patents and technology [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Gross Amount
62,972,000 
62,972,000 
 
62,972,000 
Accumulated Amortization
(25,834,000)
(25,834,000)
 
(22,356,000)
Trademarks/trade names [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Gross Amount
11,950,000 
11,950,000 
 
11,950,000 
Accumulated Amortization
(9,008,000)
(9,008,000)
 
(8,552,000)
Other [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Gross Amount
19,292,000 
19,292,000 
 
19,292,000 
Accumulated Amortization
(16,997,000)
(16,997,000)
 
(14,806,000)
Minimum [Member] |
Customer lists/relationships [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Range of life
 
10 years 
 
 
Minimum [Member] |
Patents and technology [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Range of life
 
7 years 
 
 
Minimum [Member] |
Trademarks/trade names [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Range of life
 
10 years 
 
 
Maximum [Member] |
Revenue sharing programs (RSPs) [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Range of life
 
30 years 
 
 
Maximum [Member] |
Component repair programs (CRPs) [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Range of life
 
30 years 
 
 
Maximum [Member] |
Customer lists/relationships [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Range of life
 
16 years 
 
 
Maximum [Member] |
Patents and technology [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Range of life
 
14 years 
 
 
Maximum [Member] |
Trademarks/trade names [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Range of life
 
30 years 
 
 
Maximum [Member] |
Other [Member]
 
 
 
 
Other Intangible Assets:
 
 
 
 
Range of life
 
15 years 
 
 
Industrial [Member]
 
 
 
 
Goodwill:
 
 
 
 
Goodwill, beginning of period
 
564,163,000 
 
 
Foreign currency translation
 
(11,501,000)
 
 
Goodwill, end of period
552,662,000 
552,662,000 
 
 
Aerospace [Member]
 
 
 
 
Goodwill:
 
 
 
 
Goodwill, beginning of period
 
30,786,000 
 
 
Foreign currency translation
 
 
 
Goodwill, end of period
$ 30,786,000 
$ 30,786,000 
 
 
Debt (Details)
0 Months Ended 0 Months Ended 6 Months Ended
Jun. 30, 2015
USD ($)
Dec. 31, 2014
USD ($)
Jun. 30, 2015
Revolving Credit Agreement [Member]
USD ($)
Dec. 31, 2014
Revolving Credit Agreement [Member]
USD ($)
Sep. 27, 2013
Revolving Credit Agreement [Member]
USD ($)
Dec. 31, 2014
Revolving Credit Agreement [Member]
Euro Member Countries, Euro
USD ($)
Dec. 31, 2014
Revolving Credit Agreement [Member]
Euro Member Countries, Euro
EUR (€)
Sep. 27, 2013
Revolving Credit Agreement [Member]
London Interbank Offered Rate (LIBOR) [Member]
Minimum [Member]
Sep. 27, 2013
Revolving Credit Agreement [Member]
London Interbank Offered Rate (LIBOR) [Member]
Maximum [Member]
Oct. 15, 2014
Senior Notes [Member]
Minimum [Member]
Oct. 15, 2014
Senior Notes [Member]
Maximum [Member]
Jun. 30, 2015
Senior Notes [Member]
3.97% Senior Notes [Member]
USD ($)
Dec. 31, 2014
Senior Notes [Member]
3.97% Senior Notes [Member]
USD ($)
Oct. 15, 2014
Senior Notes [Member]
3.97% Senior Notes [Member]
USD ($)
Oct. 15, 2014
Senior Notes [Member]
Adjusted for Certain Acquisitons [Member]
Maximum [Member]
Sep. 27, 2013
Revolving Credit Agreement [Member]
EUR (€)
Sep. 27, 2013
Revolving Credit Agreement [Member]
London Interbank Offered Rate (LIBOR) [Member]
Jun. 30, 2015
Lines of Credit and Overdrafts [Member]
USD ($)
Dec. 31, 2014
Lines of Credit and Overdrafts [Member]
USD ($)
Jun. 30, 2015
Lines of Credit [Member]
USD ($)
Dec. 31, 2014
Lines of Credit [Member]
USD ($)
Jun. 30, 2015
Bank Overdrafts [Member]
USD ($)
Dec. 31, 2014
Bank Overdrafts [Member]
USD ($)
Jun. 30, 2015
Capital Lease Obligations [Member]
USD ($)
Dec. 31, 2014
Capital Lease Obligations [Member]
USD ($)
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Carrying amount of debt
 
 
$ 373,000,000 
$ 393,518,000 
 
$ 37,618,000 
€ 30,945,000 
 
 
 
 
$ 100,000,000 
$ 100,000,000 
 
 
 
 
 
 
 
 
 
 
$ 2,554,000 
$ 3,188,000 
Fair value of debt
499,658,000 
509,283,000 
373,219,000 
394,917,000 
 
 
 
 
 
 
 
101,892,000 
102,859,000 
 
 
 
 
21,789,000 
8,028,000 
 
 
 
 
2,758,000 
3,479,000 
Borrowings under lines of credit and overdrafts
21,789,000 
8,028,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
21,789,000 
8,028,000 
20,900,000 
7,550,000 
889,000 
478,000 
 
 
Total debt, net of unamortized discounts
497,343,000 
504,734,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Less current maturities
(22,613,000)
(8,890,000)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long-term debt
474,730,000 
495,844,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Stated interest rate
 
 
1.29% 
1.33% 
 
 
 
 
 
 
 
 
 
3.97% 
 
 
 
 
 
 
 
 
 
 
 
Converted amount with accrued interest
 
 
 
 
 
 
 
 
 
 
 
 
 
100,000,000 
 
 
 
 
 
 
 
 
 
 
 
Percent allowed to be prepaid
 
 
 
 
 
 
 
 
 
 
 
 
 
100.00% 
 
 
 
 
 
 
 
 
 
 
 
Line of credit facility, maximum borrowing capacity
 
 
 
 
750,000,000 
 
 
 
 
 
 
 
 
 
 
500,000,000 
 
 
 
56,000,000 
 
 
 
 
 
Line of credit facility with accordian feature, maximum borrowing capacity
 
 
 
 
1,000,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Variable rate basis
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LIBOR 
 
 
 
 
 
 
 
 
Variable basis spread
 
 
 
 
 
 
 
1.10% 
1.70% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Remaining borrowing capacity
 
 
$ 377,000,000 
$ 356,482,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt covenant ratio of senior debt to EBITDA
 
 
 
 
 
 
 
 
 
 
3.25 
 
 
 
3.50 
 
 
 
 
 
 
 
 
 
 
Debt covenant ratio of total debt to EBITDA
 
 
 
 
 
 
 
 
 
 
4.00 
 
 
 
4.25 
 
 
 
 
 
 
 
 
 
 
Debt covenant ratio of EBITDA to cash interest expense
 
 
 
 
 
 
 
 
 
4.25 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Line of credit, interest rate at period end
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.19% 
1.23% 
 
 
 
 
Repayment period
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2 days 
 
 
 
Business Reorganization (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
employee
Jun. 30, 2014
Restructuring Cost and Reserve [Line Items]
 
 
Number of positions eliminated
50 
 
Restructuring charges
 
$ 5,052 
One-time Termination Benefits [Member]
 
 
Restructuring Cost and Reserve [Line Items]
 
 
Restructuring charges
 
2,112 
Facility Closing [Member]
 
 
Restructuring Cost and Reserve [Line Items]
 
 
Restructuring charges
 
$ 2,940 
Derivatives (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2015
Dec. 31, 2014
Derivative Assets (Liabilities), at Fair Value, Net, by Balance Sheet Classification [Abstract]
 
 
Derivative Assets
$ 399 
$ 460 
Derivative Liabilities
(1,395)
(1,646)
Designated as Hedging Instrument [Member] |
Interest Rate Contract [Member]
 
 
Derivative Assets (Liabilities), at Fair Value, Net, by Balance Sheet Classification [Abstract]
 
 
Derivative Assets
Derivative Liabilities
(564)
(295)
Designated as Hedging Instrument [Member] |
Foreign Exchange Contract [Member]
 
 
Derivative Assets (Liabilities), at Fair Value, Net, by Balance Sheet Classification [Abstract]
 
 
Derivative Assets
Derivative Liabilities
(50)
(652)
Not Designated as Hedging Instrument [Member] |
Foreign Exchange Contract [Member]
 
 
Derivative Assets (Liabilities), at Fair Value, Net, by Balance Sheet Classification [Abstract]
 
 
Derivative Assets
399 
460 
Derivative Liabilities
$ (781)
$ (699)
Derivatives (Details 1) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended 12 Months Ended
Jun. 30, 2015
Jun. 30, 2014
Jun. 30, 2015
Jun. 30, 2014
Jun. 30, 2015
Foreign Exchange Contract [Member]
Jun. 30, 2015
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Jun. 30, 2014
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Jun. 30, 2015
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Jun. 30, 2014
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Jun. 30, 2015
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Interest Rate Contract [Member]
Jun. 30, 2014
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Interest Rate Contract [Member]
Jun. 30, 2015
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Interest Rate Contract [Member]
Jun. 30, 2014
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Interest Rate Contract [Member]
Jun. 30, 2015
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Foreign Exchange Contract [Member]
Jun. 30, 2014
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Foreign Exchange Contract [Member]
Jun. 30, 2015
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Foreign Exchange Contract [Member]
Jun. 30, 2014
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Foreign Exchange Contract [Member]
Jun. 30, 2015
Not Designated as Hedging Instrument [Member]
Foreign Exchange Contract [Member]
Jun. 30, 2014
Not Designated as Hedging Instrument [Member]
Foreign Exchange Contract [Member]
Jun. 30, 2015
Not Designated as Hedging Instrument [Member]
Foreign Exchange Contract [Member]
Jun. 30, 2014
Not Designated as Hedging Instrument [Member]
Foreign Exchange Contract [Member]
Dec. 31, 2012
Interest Rate Swap [Member]
Designated as Hedging Instrument [Member]
Cash Flow Hedging [Member]
Bank
Derivative [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Term of interest rate derivatives
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5 years 
Number of banks transacted with for interest rate swap agreements (in banks)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative amount of hedge
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 100,000 
Variable rate basis
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
one-month LIBOR 
Fixed interest rate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.03% 
Maximum remaining maturity of foreign currency derivatives
 
 
2 years 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative, Net Hedge Ineffectiveness Gain (Loss)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net
 
 
 
 
 
189 
(502)
301 
(529)
63 
(213)
(169)
(142)
126 
(289)
470 
(387)
 
 
 
 
 
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1,671)
(241)
6,945 
(988)
 
Other
 
 
$ 8,487 
$ (137)
$ 8,695 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fair Value Measurements (Details) (USD $)
In Thousands, unless otherwise specified
6 Months Ended
Jun. 30, 2015
Dec. 31, 2014
Jun. 30, 2015
Quoted Prices in Active Markets for Identical Assets (Level 1)
Dec. 31, 2014
Quoted Prices in Active Markets for Identical Assets (Level 1)
Jun. 30, 2015
Significant Other Observable Inputs (Level 2)
Dec. 31, 2014
Significant Other Observable Inputs (Level 2)
Jun. 30, 2015
Significant Unobservable Inputs (Level 3)
Dec. 31, 2014
Significant Unobservable Inputs (Level 3)
Jun. 30, 2015
Estimate of Fair Value, Fair Value Disclosure [Member]
Dec. 31, 2014
Estimate of Fair Value, Fair Value Disclosure [Member]
Jun. 30, 2015
Minimum [Member]
Jun. 30, 2015
Maximum [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Asset derivatives
$ 399 
$ 460 
$ 0 
$ 0 
$ 399 
$ 460 
$ 0 
$ 0 
$ 399 
$ 460 
 
 
Liability derivatives
(1,395)
(1,646)
(1,395)
(1,646)
(1,395)
(1,646)
 
 
Bank acceptances
 
 
16,785 
10,785 
16,785 
10,785 
 
 
Rabbi trust assets
 
 
2,259 
2,092 
2,259 
2,092 
 
 
Financial assets and financial liabilities, reported at fair value
 
 
$ 2,259 
$ 2,092 
$ 15,789 
$ 9,599 
$ 0 
$ 0 
$ 18,048 
$ 11,691 
 
 
Maturity of bank acceptances
 
 
 
 
 
 
 
 
 
 
3 months 
6 months 
Pension and Other Postretirement Benefits (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2015
Jun. 30, 2014
Jun. 30, 2015
Jun. 30, 2014
Pensions [Member]
 
 
 
 
Pension and other postretirement benefits expenses
 
 
 
 
Service cost
$ 1,299 
$ 1,052 
$ 2,752 
$ 2,307 
Interest cost
5,297 
5,540 
9,992 
10,978 
Expected return on plan assets
(8,589)
(8,483)
(16,159)
(17,053)
Amortization of prior service cost (credit)
77 
157 
155 
334 
Amortization of actuarial losses
4,056 
2,270 
7,485 
4,232 
Curtailment loss
219 
Settlement loss
582 
582 
Special termination benefits
715 
Net periodic benefit cost
2,140 
1,118 
4,225 
2,314 
Other Postretirement Benefits [Member]
 
 
 
 
Pension and other postretirement benefits expenses
 
 
 
 
Service cost
36 
29 
73 
81 
Interest cost
425 
540 
918 
1,099 
Amortization of prior service cost (credit)
(141)
(218)
(282)
(435)
Amortization of actuarial losses
244 
267 
505 
483 
Curtailment loss
Net periodic benefit cost
$ 564 
$ 618 
$ 1,214 
$ 1,232 
Income Taxes (Details)
6 Months Ended 12 Months Ended
Jun. 30, 2015
Jun. 30, 2014
Dec. 31, 2014
Income Tax Disclosure [Abstract]
 
 
 
Effective tax rate
28.80% 
27.80% 
27.60% 
Changes in Accumulated Other Comprehensive Income by Component (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2015
Jun. 30, 2014
Jun. 30, 2015
Jun. 30, 2014
Changes in Accumulated Other Comprehensive Income by Component [Roll Forward]
 
 
 
 
Accumulated other comprehensive income (loss)
 
 
$ (99,453)
$ 25,944 
Other comprehensive (loss) income before reclassifications to consolidated statements of income
 
 
(16,019)
(19,513)
Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income
 
 
5,646 
4,043 
Net current-period other comprehensive loss
25,611 
(3,625)
(10,373)
(15,470)
Accumulated other comprehensive income (loss)
(109,826)
10,474 
(109,826)
10,474 
Gains and Losses on Cash Flow Hedges
 
 
 
 
Changes in Accumulated Other Comprehensive Income by Component [Roll Forward]
 
 
 
 
Accumulated other comprehensive income (loss)
 
 
(732)
(519)
Other comprehensive (loss) income before reclassifications to consolidated statements of income
 
 
(249)
(820)
Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income
 
 
550 
291 
Net current-period other comprehensive loss
 
 
301 
(529)
Accumulated other comprehensive income (loss)
(431)
(1,048)
(431)
(1,048)
Pension and Other Postretirement Benefit Items
 
 
 
 
Changes in Accumulated Other Comprehensive Income by Component [Roll Forward]
 
 
 
 
Accumulated other comprehensive income (loss)
 
 
(115,289)
(73,273)
Other comprehensive (loss) income before reclassifications to consolidated statements of income
 
 
355 
(8,133)
Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income
 
 
5,096 
3,752 
Net current-period other comprehensive loss
 
 
5,451 
(4,381)
Accumulated other comprehensive income (loss)
(109,838)
(77,654)
(109,838)
(77,654)
Foreign Currency Items
 
 
 
 
Changes in Accumulated Other Comprehensive Income by Component [Roll Forward]
 
 
 
 
Accumulated other comprehensive income (loss)
 
 
16,568 
99,736 
Other comprehensive (loss) income before reclassifications to consolidated statements of income
 
 
(16,125)
(10,560)
Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income
 
 
Net current-period other comprehensive loss
 
 
(16,125)
(10,560)
Accumulated other comprehensive income (loss)
$ 443 
$ 89,176 
$ 443 
$ 89,176 
Changes in Accumulated Other Comprehensive Income by Component (Details 2) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2015
Jun. 30, 2014
Jun. 30, 2015
Jun. 30, 2014
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Interest expense
$ (2,586)
$ (2,804)
$ (5,306)
$ (6,123)
Net sales
314,941 
322,074 
615,515 
634,173 
Income before income taxes
47,826 
41,785 
88,920 
73,356 
Tax benefit
(13,599)
(11,557)
(25,617)
(20,375)
Total reclassifications in the period
34,227 
30,228 
63,303 
52,981 
Reclassification out of Accumulated Other Comprehensive Income [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Total reclassifications in the period
(3,039)
(2,375)
(5,646)
(4,043)
Reclassification out of Accumulated Other Comprehensive Income [Member] |
Gains and Losses on Cash Flow Hedges
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Income before income taxes
(330)
(264)
(789)
(459)
Tax benefit
106 
92 
239 
168 
Income from continuing operations
(224)
(172)
(550)
(291)
Reclassification out of Accumulated Other Comprehensive Income [Member] |
Gains and Losses on Cash Flow Hedges |
Interest Rate Contract [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Interest expense
(214)
(222)
(429)
(439)
Reclassification out of Accumulated Other Comprehensive Income [Member] |
Gains and Losses on Cash Flow Hedges |
Foreign Exchange Contract [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Net sales
(116)
(42)
(360)
(20)
Reclassification out of Accumulated Other Comprehensive Income [Member] |
Pension and Other Postretirement Benefit Items
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Income before income taxes
(4,236)
(3,058)
(7,863)
(5,419)
Tax benefit
1,421 
855 
2,767 
1,667 
Income from continuing operations
(2,815)
(2,203)
(5,096)
(3,752)
Amortization of prior-service credits, net
64 
61 
127 
101 
Amortization of actuarial losses
(4,300)
(2,537)
(7,990)
(4,715)
Curtailment loss
 
 
(223)
Settlement loss
$ 0 
$ (582)
$ 0 
$ (582)
Information on Business Segments (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2015
Jun. 30, 2014
Jun. 30, 2015
Segment
Jun. 30, 2014
Segment Reporting Information [Line Items]
 
 
 
 
Number of reportable segments
 
 
 
Net sales
$ 314,941 
$ 322,074 
$ 615,515 
$ 634,173 
Operating profit
50,649 
45,381 
94,544 
80,506 
Interest expense
2,586 
2,804 
5,306 
6,123 
Other expense (income), net
237 
792 
318 
1,027 
Income before income taxes
47,826 
41,785 
88,920 
73,356 
Aerospace [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net sales
112,356 
109,310 
212,581 
217,521 
Operating profit
20,670 
16,616 
33,586 
32,366 
Industrial [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net sales
202,589 
212,768 
402,938 
416,656 
Operating profit
29,979 
28,765 
60,958 
48,140 
Intersegment sales [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net sales
$ (4)
$ (4)
$ (4)
$ (4)
Information on Business Segments Details 1 (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2015
Dec. 31, 2014
Segment Reporting Information [Line Items]
 
 
Assets
$ 2,078,643 
$ 2,073,885 
Aerospace [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Assets
655,806 
655,042 
Industrial [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Assets
1,251,669 
1,281,974 
Other [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Assets
$ 171,168 
$ 136,869 
Subsequent Event (Details) (Subsequent Event [Member], Thermoplay [Member], EUR €)
In Millions, unless otherwise specified
0 Months Ended
Jul. 20, 2015
Subsequent Event [Member] |
Thermoplay [Member]
 
Subsequent Event [Line Items]
 
Purchase price
€ 50