Financial Instruments and Fair Value Measurements (Tables)
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6 Months Ended |
Jul. 01, 2022 |
Fair Value Disclosures [Abstract] |
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Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis |
The following tables provide information regarding assets and liabilities recorded at fair value on a recurring basis (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | Fair Value | | Quoted Prices in Active Markets (Level 1) | | Significant Other Observable Inputs (Level 2) | | Significant Unobservable Inputs (Level 3) | July 1, 2022 | | | | | | | | Assets: Interest rate swaps | $ | 841 | | | $ | — | | | $ | 841 | | | $ | — | | Assets: Foreign currency hedging contracts | 1,395 | | | — | | | 1,395 | | | — | | Liabilities: Foreign currency hedging contracts | 1,126 | | | — | | | 1,126 | | | — | | | | | | | | | | Liabilities: Contingent consideration | 9,072 | | | — | | | — | | | 9,072 | | | | | | | | | | December 31, 2021 | | | | | | | | Assets: Foreign currency hedging contracts | $ | 687 | | | $ | — | | | $ | 687 | | | $ | — | | Liabilities: Interest rate swap | 2,978 | | | — | | | 2,978 | | | — | | Liabilities: Contingent consideration | 2,415 | | | — | | | — | | | 2,415 | |
Information regarding the Company’s outstanding interest rate swap designated as cash flow hedges as of July 1, 2022 is as follows (dollars in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Notional Amount | | | | Start Date | | End Date | | Pay Fixed Rate | | Receive Current Floating Rate | | Fair Value | | Balance Sheet Location | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 150,000 | | | | | Jun 2020 | | Jun 2023 | | 2.1785 | % | | 1.6240 | % | | $ | 841 | | | Prepaid expenses and other current assets |
Information regarding the Company’s outstanding interest rate swap designated as cash flow hedges as of December 31, 2021 is as follows (dollars in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Notional Amount | | | | Start Date | | End Date | | Pay Fixed Rate | | Receive Current Floating Rate | | Fair Value | | Balance Sheet Location | $ | 150,000 | | | | | Jun 2020 | | Jun 2023 | | 2.1785 | % | | 0.1013 | % | | $ | (2,978) | | | Other long-term liabilities |
Information regarding outstanding foreign currency forward contracts designated as cash flow hedges as of July 1, 2022 is as follows (dollars in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Notional Amount | | End Date | | $/Foreign Currency | | Fair Value | | Balance Sheet Location | $ | 10,923 | | | Dec 2022 | | 0.0455 | | MXN Peso | | $ | 728 | | | Prepaid expenses and other current assets | 6,830 | | | Dec 2022 | | 1.1383 | | Euro | | (522) | | | Accrued expenses and other current liabilities | 4,106 | | | Dec 2022 | | 0.0216 | | UYU Peso | | 667 | | | Prepaid expenses and other current assets | 6,760 | | | Dec 2022 | | 1.1266 | | Euro | | (453) | | | Accrued expenses and other current liabilities | 3,833 | | | Dec 2022 | | 1.0952 | | Euro | | (151) | | | Accrued expenses and other current liabilities |
Information regarding outstanding foreign currency forward contracts designated as cash flow hedges as of December 31, 2021 is as follows (dollars in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Notional Amount | | End Date | | $/Foreign Currency | | Fair Value | | Balance Sheet Location | | | | | | | | | | | | | | | | | | | | | | | $ | 22,201 | | | Dec 2022 | | 0.0463 | | MXN Peso | | $ | 408 | | | Prepaid expenses and other current assets | 17,017 | | | Dec 2022 | | 1.1344 | | Euro | | 130 | | | Prepaid expenses and other current assets | 9,020 | | | Dec 2022 | | 0.0220 | | UYU Peso | | 149 | | | Prepaid expenses and other current assets | | | | | | | | | | | |
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Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) |
The following tables present the effect of cash flow hedge derivative instruments on other comprehensive income (loss) (“OCI”), AOCI and the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the three and six months ended July 1, 2022 and July 2, 2021 (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended | | | July 1, 2022 | | July 2, 2021 | | | Total | | Amount of Gain (Loss) on Cash Flow Hedge Activity | | Total | | Amount of Gain (Loss) on Cash Flow Hedge Activity | Sales | | $ | 350,081 | | | $ | (371) | | | $ | 312,023 | | | $ | 29 | | Cost of sales | | 257,184 | | | 554 | | | 223,277 | | | 450 | | Operating expenses | | 60,190 | | | 112 | | | 49,396 | | | 11 | | Interest expense | | 7,773 | | | (526) | | | 7,532 | | | (995) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Six Months Ended | | | July 1, 2022 | | July 2, 2021 | | | Total | | Amount of Gain (Loss) on Cash Flow Hedge Activity | | Total | | Amount of Gain (Loss) on Cash Flow Hedge Activity | Sales | | $ | 660,993 | | | $ | (425) | | | $ | 602,490 | | | $ | 37 | | Cost of sales | | 486,621 | | | 746 | | | 429,258 | | | 1,074 | | Operating expenses | | 119,168 | | | 136 | | | 99,274 | | | 38 | | Interest expense | | 13,741 | | | (1,293) | | | 16,064 | | | (2,029) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Unrealized Gain (Loss) Recognized in OCI | | Realized Gain (Loss) Reclassified from AOCI | | | Three Months Ended | | Location in Statements of Operations and Comprehensive Income (Loss) | | Three Months Ended | | | July 1, 2022 | | July 2, 2021 | | | July 1, 2022 | | July 2, 2021 | Interest rate swap | | $ | 702 | | | $ | (375) | | | Interest expense | | $ | (526) | | | $ | (995) | | Foreign exchange contracts | | (1,167) | | | 148 | | | Sales | | (371) | | | 29 | | Foreign exchange contracts | | 96 | | | 725 | | | Cost of sales | | 554 | | | 450 | | Foreign exchange contracts | | 78 | | | 67 | | | Operating expenses | | 112 | | | 11 | | | | | | | | | | | | | | | Six Months Ended | | Location in Statements of Operations and Comprehensive Income (Loss) | | Six Months Ended | | | July 1, 2022 | | July 2, 2021 | | | July 1, 2022 | | July 2, 2021 | Interest rate swaps | | $ | 2,526 | | | $ | (109) | | | Interest expense | | $ | (1,293) | | | $ | (2,029) | | Foreign exchange contracts | | (1,681) | | | (738) | | | Sales | | (425) | | | 37 | | Foreign exchange contracts | | 1,365 | | | 166 | | | Cost of sales | | 746 | | | 1,074 | | Foreign exchange contracts | | 355 | | | (23) | | | Operating expenses | | 136 | | | 38 | |
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Schedule of Estimated Fair Values for Contingent Consideration |
The following table presents the changes in the estimated fair values of the Company’s liabilities for contingent consideration measured using significant unobservable inputs (Level 3) for the three and six months ended July 1, 2022 and July 2, 2021 (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended | | Six Months Ended | | July 1, 2022 | | July 2, 2021 | | July 1, 2022 | | July 2, 2021 | Fair value measurement at beginning of period | $ | 1,976 | | | $ | 2,281 | | | $ | 2,415 | | | $ | 3,900 | | Amount recorded for current year acquisitions | 7,375 | | | — | | | 7,375 | | | — | | Fair value measurement adjustment | — | | | — | | | 54 | | | — | | Payments | — | | | — | | | (493) | | | (1,621) | | Foreign currency translation | (279) | | | — | | | (279) | | | 2 | | Fair value measurement at end of period | $ | 9,072 | | | $ | 2,281 | | | $ | 9,072 | | | $ | 2,281 | |
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Schedule of Contingent Consideration Measurement Inputs |
The following table provides quantitative information associated with the fair value measurement of the Company’s liabilities for contingent consideration: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | July 1, 2022 | | | | | | | Contingency Type | | Maximum Payout (undiscounted) | | Fair Value | | Valuation Technique | | Unobservable Inputs | | Weighted Average or Range | Revenue-based payments: | | | | | | | | | | | InoMec and USB | | $ | 5,375 | | | $ | 1,976 | | | Monte Carlo | | Revenue volatility | | 26.7 | % | | | | | | | | | Discount rate | | 1.8 | % | | | | | | | | | Projected year(s) of payment | | 2022-2024 | Aran | | $ | 10,484 | | | $ | 7,096 | | | Probability-weighted expected returns method | | Probability of occurrence | | 0% - 50% | | | | | | | | Discount rate | | 9.7 | % | | | | | | | | Projected year(s) of payment | | 2023 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2021 | | | | | | | Contingency Type | | Maximum Payout (undiscounted) | | Fair Value | | Valuation Technique | | Unobservable Inputs | | Weighted Average or Range | Revenue-based payments: | | | | | | | | | | | InoMec and USB | | $ | 6,750 | | | $ | 2,415 | | | Monte Carlo | | Revenue volatility | | 29.0 | % | | | | | | | | | Discount rate | | 1.8 | % | | | | | | | | | Projected year(s) of payment | | 2022-2024 |
(13.) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued)
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Schedule of Equity Method Investments |
Equity investments comprise the following (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | July 1, 2022 | | December 31, 2021 | Equity method investment | | | | | $ | 13,468 | | | $ | 16,192 | | Non-marketable equity securities | | | | | 5,637 | | | 5,637 | | Total equity investments | | | | | $ | 19,105 | | | $ | 21,829 | |
The components of Loss on equity investments for each period were as follows (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended | | Six Months Ended | | July 1, 2022 | | July 2, 2021 | | July 1, 2022 | | July 2, 2021 | Equity method investment loss | $ | 320 | | | $ | 684 | | | $ | 2,724 | | | $ | 2,019 | | | | | | | | | | | | | | | | | | | | | | | | | |
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