Business Segment and Geographical Information

12 Months Ended

Dec. 28, 2019

Business Segment and Geographical Information

The Company has combined its operating entities into three reportable operating segments, Papermaking Systems, Wood Processing Systems, and Material Handling Systems, and a separate product line, Fiber-based Products, as described below. In classifying operational entities into a particular segment, the Company has aggregated businesses with similar economic characteristics, products and services, production processes, customers, and methods of distribution.

•

Papermaking Systems Segment – The Company develops, manufactures, and markets a range of equipment and products for the global papermaking, paper recycling, recycling and waste management, and other process industries. The Company's Papermaking Systems segment consists of the following product lines: Stock-Preparation; Fluid-Handling; and Doctoring, Cleaning, & Filtration. The Company's principal products include custom-engineered stock-preparation systems and equipment for the preparation of wastepaper for conversion into recycled paper and balers and related equipment used in the processing of recyclable and waste materials; fluid-handling systems and equipment used in industrial piping systems to compensate for movement and to efficiently transfer fluid, power, and data; doctoring systems and equipment and related consumables important to the efficient operation of paper machines and other industrial processes; and filtration and cleaning systems essential for draining, purifying, and recycling process water and cleaning fabrics, belts, and rolls in various process industries.

•

Wood Processing Systems Segment – The Company develops, manufactures, and markets debarkers, stranders, chippers, logging machinery, and related equipment used in the harvesting and production of lumber and OSB. Material Handling Systems Segment – The Company develops, manufactures, and markets material handling equipment and systems, including vibratory and conveying equipment, to various process industries, including mining, aggregates, food processing, packaging, and pulp and paper.


•	Fiber-based Products business – The Company manufactures and sells biodegradable, absorbent granules derived from papermaking by-products. These materials are primarily used as carriers in agricultural, home lawn and garden, professional lawn, turf and ornamental applications, and for oil and grease absorption.

The following table presents financial information for the Company's reportable operating segments:



(In thousands)	December 28, 2019			December 29, 2018			December 30, 2017
Business Segment Information
Revenues by Product Line:
Stock-Preparation	$	215,091		$	221,933		$	193,838
Fluid-Handling	132,501			131,830			104,136
Doctoring, Cleaning, & Filtration	117,838			116,136			109,631
Papermaking Systems	465,430			469,899			407,605
Wood Processing Systems	143,187			151,366			95,053
Material Handling Systems (a)	83,364			—			—
Fiber-based Products	12,663			12,521			12,375
	$	704,644		$	633,786		$	515,033
Income Before Provision for Income Taxes:
Papermaking Systems (b)	$	81,232		$	83,454		$	73,069
Wood Processing Systems (c)	28,166			31,237			10,005
Material Handling Systems (a, d)	3,132			—			—
Corporate and Fiber-based Products (e)	(24,707		)	(26,093		)	(21,449		)
Total operating income	87,823			88,598			61,625
Interest expense, net (f)	(12,542		)	(6,653		)	(3,100		)
Other expense, net (f, g)	(6,359		)	(2,417		)	(872		)
	$	68,922		$	79,528		$	57,653



(In thousands)	December 28, 2019		December 29, 2018		December 30, 2017
Total Assets:
Papermaking Systems	$	464,069	$	462,297	$	494,919
Wood Processing Systems	249,689		247,553		257,467
Material Handling Systems (a)	196,884		—		—
Corporate and Fiber-based Products (h)	28,745		15,899		8,708
	$	939,387	$	725,749	$	761,094
Depreciation and Amortization:
Papermaking Systems	$	13,010	$	12,561	$	11,239
Wood Processing Systems	9,571		10,317		7,515
Material Handling Systems (a)	9,018		—		—
Corporate and Fiber-based Products	791		690		621
	$	32,390	$	23,568	$	19,375
Capital Expenditures:
Papermaking Systems	$	6,127	$	12,717	$	14,359
Wood Processing Systems	2,133		3,272		2,333
Material Handling Systems (a)	1,195		—		—
Corporate and Fiber-based Products	502		570		589
	$	9,957	$	16,559	$	17,281
Geographical Information
Revenues (i):
United States	$	309,957	$	234,487	$	182,788
China	66,480		89,645		63,910
Canada	64,010		61,096		47,611
Germany	29,076		26,577		32,026
Finland	11,113		10,934		8,607
Other	224,008		211,047		180,091
	$	704,644	$	633,786	$	515,033
Long-lived Assets (j):
United States	$	42,094	$	35,446	$	32,852
China	10,319		11,069		11,685
Canada	7,948		8,193		9,449
Finland	6,960		6,998		5,841
Germany	5,925		6,223		6,452
Other	12,786		12,228		13,444
	$	86,032	$	80,157	$	79,723


(a)	Comprised of the SMH business, which was acquired on January 2, 2019 (see Note 2).


(b)	Includes $787,000 in 2017 of acquisition-related expenses, comprised of acquisition transaction costs and amortization of acquired profit in inventory and backlog. Includes restructuring costs of $1,717,000 in 2018 and $203,000 in 2017 (see Note 8).


(c)	Includes $2,336,000 and $192,000 in 2019 of impairment and restructuring costs, respectively, related to the timber-harvesting product line (see Notes 1 and 8). Includes $252,000 in 2018 and $11,163,000 in 2017 of acquisition-related expenses.


(d)	Includes $5,715,000 in 2019 of acquisition-related expenses, comprised of amortization expense associated with acquired profit in inventory and backlog and acquisition transaction costs.


(e)	Corporate primarily includes general and administrative expenses, including $1,321,000 in 2018 of acquisition transaction costs.


(f)	The Company does not allocate interest and other expense, net to its segments.


(g)	Includes a settlement loss of $5,887,000 in 2019 and a curtailment loss of $1,425,000 in 2018 (see Note 3).


(h)	Primarily includes Corporate and Fiber-based Products' cash and cash equivalents, tax assets, ROU assets, and property, plant, and equipment, net.


(i)	Revenues are attributed to countries based on customer location.

(j)

Represents property, plant, and equipment, net.