Delaware | 36-3601505 |
(State or Other Jurisdiction of | (IRS Employer |
Incorporation or Organization) | Identification No.) |
Title of Each Class | Name of Each Exchange on Which Registered | |
Common Stock, $0.01 par value | The New York Stock Exchange | |
Depositary Shares, each representing a 1/100th interest in a share of 6.75% Series B Mandatory Converible Preferred Stock | The New York Stock Exchange |
Form 10-K Item No. | Name of Item | Page | ||
Part I | ||||
Item 1. | ||||
Item 1A. | ||||
Item 1B. | ||||
Item 2. | ||||
Item 3. | ||||
Item 4. | ||||
Part II | ||||
Item 5. | ||||
Item 6. | ||||
Item 7. | ||||
Item 7A. | ||||
Item 8. | ||||
Item 9. | ||||
Item 9A. | ||||
Item 9B. | ||||
Part III | ||||
Item 10. | ||||
Item 11. | ||||
Item 12. | ||||
Item 13. | ||||
Item 14. | ||||
Part IV. | ||||
Item 15. | ||||
• | Operational Excellence—The core of our business model is operational excellence and the execution of our Belden Business System. The Belden Business System has three areas of focus. First, we demonstrate a commitment to Lean enterprise initiatives, which improve not only the quality and efficiency of the manufacturing environment, but our business processes on a company-wide basis. Second, we utilize our Market Delivery System (MDS), a go-to-market model that provides the foundation for organic growth. We believe that organic growth, resulting from both market growth and share capture, is essential to our success. Finally, our Talent Management System supports the development of our associates at all levels, which preserves the culture necessary to operate our business consistently and sustainably. |
• | Cash Generation—Our pursuit of operational excellence results in the generation of significant cash flow. We generated cash flows from operating activities of $289.2 million, $255.3 million, and $314.8 million in 2018, 2017, and 2016, respectively. |
• | Portfolio Improvement—We utilize the cash flow generated by our business to fuel our continued transformation and generate shareholder value. We continuously improve our portfolio to ensure we provide the most complete, end-to-end solutions to our customers. Our portfolio is designed with balance across end markets and geographies to ensure we can meet our goals in most economic environments. We have a disciplined acquisition cultivation, execution, and integration system that allows us to invest in outstanding companies that strengthen our capabilities and enhance our ability to serve our customers. |
2018 | 2017 | 2016 | |||||||||
Copper spot prices per pound | |||||||||||
High | $ | 3.29 | $ | 3.29 | $ | 2.69 | |||||
Low | $ | 2.56 | $ | 2.48 | $ | 1.94 |
Name | Age | Position | ||
John Stroup | 52 | President, Chief Executive Officer, and Chairman | ||
Brian Anderson | 44 | Senior Vice President, Legal, General Counsel and Corporate Secretary | ||
Henk Derksen | 50 | Senior Vice President, Finance, and Chief Financial Officer | ||
Leo Kulmaczewski | 53 | Senior Vice President, Operations and Lean Enterprise | ||
Dean McKenna | 50 | Senior Vice President, Human Resources | ||
Glenn Pennycook | 56 | Executive Vice President, Enterprise Solutions | ||
Ross Rosenberg | 49 | Senior Vice President, Strategy and Corporate Development | ||
Dhrupad Trivedi | 52 | Executive Vice President, Chief Technology Officer and President, Tripwire | ||
Paul Turner | 55 | Senior Vice President, Sales | ||
Roel Vestjens | 44 | Executive Vice President, Industrial Solutions | ||
Doug Zink | 43 | Vice President and Chief Accounting Officer |
Enterprise Solutions | Industrial Solutions | Utilized by Multiple Segments | Total | ||||||||
Brazil | — | 1 | — | 1 | |||||||
Canada | 1 | 1 | — | 2 | |||||||
China | 1 | — | 1 | 2 | |||||||
Czech Republic | — | 1 | — | 1 | |||||||
Denmark | 2 | — | — | 2 | |||||||
Germany | — | 4 | — | 4 | |||||||
Hungary | — | — | 1 | 1 | |||||||
Italy | — | — | 1 | 1 | |||||||
Japan | 1 | — | — | 1 | |||||||
Mexico | 1 | — | 2 | 3 | |||||||
Netherlands | 1 | 1 | — | 2 | |||||||
St. Kitts | 1 | — | — | 1 | |||||||
United Kingdom | 3 | — | — | 3 | |||||||
United States | 5 | 6 | 2 | 13 | |||||||
Total | 16 | 14 | 7 | 37 |
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Repurchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs | ||||||||||
October 1, 2018 through November 4, 2018 | — | $ | — | — | $ | 50,000,000 | ||||||||
November 5, 2018 through December 2, 2018 | 912,530 | 54.79 | 912,530 | 300,000,000 | ||||||||||
December 3, 2018 through December 31, 2018 | — | — | — | 300,000,000 | ||||||||||
Total | 912,530 | $ | 54.79 | 912,530 | $ | 300,000,000 | ||||||||
(1) | The chart above and the accompanying data are “furnished,” not “filed,” with the SEC. |
ANNUAL RETURN PERCENTAGE Years Ending December 31, | ||||||||||||||||||||||||
Company Name / Index | 2014 | 2015 | 2016 | 2017 | 2018 | |||||||||||||||||||
Belden Inc. | 12.2 | % | (39.3 | )% | 57.3 | % | 3.5 | % | (45.7 | )% | ||||||||||||||
S&P 500 Index | 13.7 | % | 1.4 | % | 12.0 | % | 21.8 | % | (4.4 | )% | ||||||||||||||
S&P 1500 Industrials Index | 8.5 | % | (2.7 | )% | 20.4 | % | 21.1 | % | (13.4 | )% | ||||||||||||||
INDEXED RETURNS | ||||||||||||||||||||||||
Years Ending December 31, | ||||||||||||||||||||||||
Company Name / Index | Base Period 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||||||||||
Belden Inc. | $ | 100.00 | $ | 112.18 | $ | 68.09 | $ | 107.10 | $ | 110.83 | $ | 60.21 | ||||||||||||
S&P 500 Index | 100.00 | 113.69 | 115.26 | 129.05 | 157.22 | 150.33 | ||||||||||||||||||
S&P 1500 Industrials Index | 100.00 | 108.48 | 105.53 | 127.07 | 153.83 | 133.25 |
Years Ended December 31, | |||||||||||||||||||
2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||
(In thousands, except per share amounts and percentages) | |||||||||||||||||||
Balance sheet data: | |||||||||||||||||||
Total assets | $ | 3,779,321 | $ | 3,840,613 | $ | 3,806,803 | $ | 3,290,602 | $ | 3,232,202 | |||||||||
Long-term debt | 1,463,200 | 1,560,748 | 1,620,161 | 1,725,282 | 1,736,954 | ||||||||||||||
Long-term debt, including current maturities | 1,463,200 | 1,560,748 | 1,620,161 | 1,727,782 | 1,739,454 | ||||||||||||||
Total stockholders’ equity | 1,387,588 | 1,434,866 | 1,461,317 | 825,523 | 807,186 | ||||||||||||||
Statement of operations data: | |||||||||||||||||||
Revenues | 2,585,368 | 2,388,643 | 2,356,672 | 2,309,222 | 2,308,265 | ||||||||||||||
Operating income | 305,221 | 235,404 | 232,083 | 143,731 | 166,017 | ||||||||||||||
Operating income margin | 11.8 | % | 9.9 | % | 9.8 | % | 6.2 | % | 7.2 | % | |||||||||
Income from continuing operations | 160,711 | 92,853 | 127,646 | 66,508 | 74,432 | ||||||||||||||
Basic income per share attributable to Belden common stockholders | 3.10 | 1.38 | 2.67 | 1.57 | 1.72 | ||||||||||||||
Diluted income per share attributable to Belden common stockholders | 3.08 | 1.37 | 2.65 | 1.55 | 1.69 | ||||||||||||||
Other data: | |||||||||||||||||||
Basic weighted average common shares outstanding | 40,675 | 42,220 | 42,093 | 42,390 | 43,273 | ||||||||||||||
Diluted weighted average common shares outstanding | 40,956 | 42,643 | 42,557 | 42,953 | 43,997 | ||||||||||||||
Dividends per common share | $ | 0.20 | $ | 0.20 | $ | 0.20 | $ | 0.20 | $ | 0.20 | |||||||||
Statement of cash flow data: | |||||||||||||||||||
Net cash provided by operating activities | 289,220 | 255,300 | 314,794 | 241,460 | 200,887 | ||||||||||||||
Adjusted results: | |||||||||||||||||||
Adjusted revenues | 2,591,980 | 2,388,643 | 2,357,805 | 2,360,583 | 2,320,219 | ||||||||||||||
Adjusted EBITDA | 474,162 | 434,276 | 431,201 | 400,688 | 359,425 | ||||||||||||||
Adjusted EBITDA margin | 18.3 | % | 18.2 | % | 18.3 | % | 17.0 | % | 15.5 | % | |||||||||
Free cash flow | 192,953 | 192,078 | 261,212 | 187,024 | 157,312 |
• | During 2018, we acquired SAM and NT2 in our fiscal first and second quarters, respectively; and recognized severance, restructuring, and acquisition integration costs of $68.6 million primarily related to the integration of SAM with our Grass Valley business as well as costs from a program to consolidate our manufacturing footprint. We also recognized a $23.0 million loss on debt extinguishment related to our debt refinancing transactions during the year and a $62.1 million gain for amounts received from a patent infringement litigation - see further discussion in Part I Item 3 Legal Proceedings. |
• | During 2017, we recognized a $52.4 million loss on debt extinguishment related to our debt refinancing transactions during the year; severance, restructuring, and acquisition integration costs of $42.8 million related to a number of productivity improvement programs; and acquired Thinklogical Holdings, LLC in our fiscal second quarter. |
• | During 2016, we recognized severance, restructuring, and acquisition integration costs of $38.8 million related to a number of productivity improvement programs. In addition, we acquired M2FX Limited in our fiscal first quarter. |
• | During 2015, we recognized severance, restructuring, and acquisition integration costs of $47.2 million related to a number of productivity improvement programs. In addition, we acquired Tripwire in our fiscal first quarter. We also recognized $9.2 million of compensation expense related to the accelerated vesting of acquiree stock based compensation awards related to our acquisition of Tripwire. |
• | During 2014, we recognized severance, restructuring, and acquisition integration costs of $70.8 million related to the integration of acquired businesses and a productivity improvement program. In 2014, we acquired Grass Valley, ProSoft, and Coast. We recognized purchase accounting effects related to acquisitions, including the adjustment of acquired inventory to fair value, of $8.4 million. |
December 31, 2018 | December 31, 2017 | Years Ended December 31, 2016 | December 31, 2015 | December 31, 2014 | |||||||||||||||
(In thousands, except percentages) | |||||||||||||||||||
GAAP revenues | $ | 2,585,368 | $ | 2,388,643 | $ | 2,356,672 | $ | 2,309,222 | $ | 2,308,265 | |||||||||
Deferred revenue adjustments (1) | 6,612 | — | 6,687 | 51,361 | 11,954 | ||||||||||||||
Patent settlement (2) | — | — | (5,554 | ) | — | — | |||||||||||||
Adjusted revenues | $ | 2,591,980 | $ | 2,388,643 | $ | 2,357,805 | $ | 2,360,583 | $ | 2,320,219 | |||||||||
GAAP net income | 160,711 | 92,853 | 127,646 | 66,180 | $ | 74,449 | |||||||||||||
Amortization of intangible assets | 98,829 | 103,997 | 98,385 | 103,791 | 58,426 | ||||||||||||||
Severance, restructuring, and acquisition integration costs (3) | 68,613 | 42,790 | 31,140 | 47,170 | 70,827 | ||||||||||||||
Interest expense, net | 61,559 | 82,901 | 95,050 | 100,613 | 81,573 | ||||||||||||||
Income tax expense (benefit) | 59,619 | 6,495 | (1,185 | ) | (26,568 | ) | 7,114 | ||||||||||||
Depreciation expense | 47,615 | 45,597 | 47,208 | 46,551 | 43,736 | ||||||||||||||
Loss on debt extinguishment | 22,990 | 52,441 | 2,342 | — | — | ||||||||||||||
Deferred revenue adjustments (1) | 6,612 | — | 6,687 | 52,876 | 10,777 | ||||||||||||||
Purchase accounting effects related to acquisitions (4) | 3,497 | 6,133 | (2,079 | ) | 9,747 | 12,540 | |||||||||||||
Costs related to patent litigation | 2,634 | — | — | — | — | ||||||||||||||
Amortization of software development intangible assets | 2,188 | 56 | — | — | — | ||||||||||||||
Non-operating pension settlement loss | 1,342 | — | 7,630 | — | — | ||||||||||||||
Loss on sale of assets (5) | 94 | 1,013 | — | — | — | ||||||||||||||
Impairment of assets held for sale (5) | — | — | 23,931 | — | — | ||||||||||||||
Patent settlement (2) | — | — | (5,554 | ) | — | — | |||||||||||||
Gain from patent litigation | (62,141 | ) | — | — | — | — | |||||||||||||
Loss (Income) from discontinued operations | — | — | — | 242 | (579 | ) | |||||||||||||
Loss from disposal of discontinued operations | — | — | — | 86 | 562 | ||||||||||||||
Adjusted EBITDA | $ | 474,162 | $ | 434,276 | $ | 431,201 | $ | 400,688 | $ | 359,425 | |||||||||
GAAP net income margin | 6.2 | % | 3.9 | % | 5.4 | % | 2.9 | % | 3.2 | % | |||||||||
Adjusted EBITDA margin | 18.3 | % | 18.2 | % | 18.3 | % | 17.0 | % | 15.5 | % |
(1) | Our adjusted results include revenues that would have been recorded by acquired businesses had they remained as independent entities. Our consolidated results do not include these revenues due to the purchase accounting effect of recording deferred revenue at fair value. |
(2) | Both our consolidated revenues and gross profit were positively impacted by royalty revenues received during 2016 that related to years prior to 2016 as a result of a patent settlement. |
(3) | See Note 12 to the Consolidated Financial Statements, Severance, Restructuring, and Acquisition Integration Activities, for details. |
(4) | In 2018, we recognized $3.5 million of cost of sales related to purchase accounting adjustments, most of which was for the adjustment of acquired inventory to fair value for our SAM and NT2 acquisitions. In 2017, we recognized $6.1 million of cost of sales related to the adjustment of acquired inventory to fair value for our Thinklogical acquisition. In 2016, we made a $3.2 million adjustment to reduce the earn-out liability associated with the M2FX acquisition. This adjustment was partially offset by $0.8 million and $0.2 million of cost of sales related to the adjustment of acquired inventory to fair value related our Enterprise segment and M2FX acquisition, respectively. In 2015, we recognized $9.2 million of compensation expense related to the accelerated vesting of acquiree stock based compensation awards associated with our acquisition of Tripwire. In addition, we recognized $0.3 million of cost of sales related to the adjustment of acquired inventory to fair value related to our acquisition of Coast and $0.3 million of acquisition related transaction costs. In 2014, we recognized $8.4 million of cost of sales related to the adjustment of acquired inventory to fair value for our acquisitions of Grass Valley, ProSoft, and Coast, as well as $4.1 million of acquisition related transaction costs. |
(5) | In 2018, 2017, and 2016, we recognized a $0.1 million loss on sale of assets, $1.0 million loss on sale of assets, and $23.9 million impairment of assets held for sale, respectively, for the sale of our MCS business and Hirschmann JV. |
Years ended December 31, | |||||||||||||||||||
2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||
(In thousands) | |||||||||||||||||||
Net cash provided by operating activities | $ | 289,220 | $ | 255,300 | $ | 314,794 | $ | 241,460 | $ | 200,887 | |||||||||
Capital expenditures, net of proceeds from the disposal of tangible assets | (96,267 | ) | (63,222 | ) | (53,582 | ) | (54,436 | ) | (43,575 | ) | |||||||||
Free cash flow | $ | 192,953 | $ | 192,078 | $ | 261,212 | $ | 187,024 | $ | 157,312 |
• | Delivering highly engineered signal transmission solutions for mission-critical applications in a diverse set of global markets; |
• | Maintaining a balanced product portfolio across end markets, applications, and geographies that allows for a disciplined approach to growth; |
• | Capturing additional market share by using our Market Delivery System to improve channel and end-user relationships and to concentrate sales efforts on customers in higher growth geographies and vertical end-markets; |
• | Managing our product portfolio to provide innovative and complete end-to-end solutions for our customers in applications for which we have operational expertise and can drive customer loyalty; |
• | Acquiring leading companies with innovative product portfolios and opportunities for synergies which fit within our strategic framework; |
• | Continuously improving our people, processes, and systems through scalable, flexible, and sustainable business systems for talent management, Lean enterprise, and acquisition cultivation and integration; and |
• | Protecting and enhancing the value of the Belden brands. |
• | Grow Adjusted Revenues on a constant currency basis by 5-7% per year, from a combination of end market growth, market share capture, and contributions from acquisitions; |
• | Achieve Adjusted EBITDA margins in the range of 20-22%; |
• | Achieve free cash flow growth in the range of 13-15%; and |
• | Realize return on invested capital of 13-15%. |
Percentage Change | |||||||||||||||||
2018 | 2017 | 2016 | 2018 vs. 2017 | 2017 vs. 2016 | |||||||||||||
(In thousands, except percentages) | |||||||||||||||||
Revenues | $ | 2,585,368 | $ | 2,388,643 | $ | 2,356,672 | 8.2 | % | 1.4 | % | |||||||
Gross profit | 1,008,412 | 934,753 | 981,321 | 7.9 | % | (4.7 | )% | ||||||||||
Selling, general and administrative expenses | 525,918 | 461,022 | 486,403 | 14.1 | % | (5.2 | )% | ||||||||||
Research and development expenses | 140,585 | 134,330 | 140,519 | 4.7 | % | (4.4 | )% | ||||||||||
Amortization of intangibles | 98,829 | 103,997 | 98,385 | (5.0 | )% | 5.7 | % | ||||||||||
Gain from patent litigation | 62,141 | — | — | n/a | — | % | |||||||||||
Impairment of assets held for sale | — | — | 23,931 | — | % | (100.0 | )% | ||||||||||
Operating income | 305,221 | 235,404 | 232,083 | 29.7 | % | 1.4 | % | ||||||||||
Interest expense, net | 61,559 | 82,901 | 95,050 | (25.7 | )% | (12.8 | )% | ||||||||||
Non-operating pension cost | 342 | 714 | 8,230 | (52.1 | )% | (91.3 | )% | ||||||||||
Loss on debt extinguishment | 22,990 | 52,441 | 2,342 | (56.2 | )% | 2,139.2 | % | ||||||||||
Income before taxes | 220,330 | 99,348 | 126,461 | 121.8 | % | (21.4 | )% |
• | Acquisitions contributed $123.9 million to the increase in revenues. |
• | Higher sales volume resulted in a $75.7 million increase in revenues. |
• | Currency translation had a $14.8 million favorable impact on revenues. |
• | Higher copper costs contributed $10.1 million to the increase in revenues. |
• | The divestiture of our MCS business resulted in a $27.7 million decrease in revenues. |
• | Acquisitions contributed $30.8 million to the increase in revenues. |
• | Higher copper costs contributed $13.0 million to the increase in revenues. |
• | Currency translation had a $12.2 million favorable impact on revenues. |
• | Lower sales volume resulted in a $24.1 million decrease in revenues. |
Percentage Change | |||||||||||||||||
2018 | 2017 | 2016 | 2018 vs. 2017 | 2017 vs. 2016 | |||||||||||||
(In thousands, except percentages) | |||||||||||||||||
Income before taxes | $ | 220,330 | $ | 99,348 | $ | 126,461 | 121.8 | % | (21.4 | )% | |||||||
Income tax benefit (expense) | (59,619 | ) | (6,495 | ) | 1,185 | 817.9 | % | (648.1 | )% | ||||||||
Effective tax rate | 27.1 | % | 6.5 | % | (0.9 | )% |
• | On December 22, 2017, the “Tax Cuts and Jobs Act” (the “Act”) was signed into law, making significant changes to the U.S. Internal Revenue Code. Changes included, but were not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning after December 31, 2017, the transition of U.S. international taxation from a worldwide tax system to a territorial tax system, and a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017. The Company calculated its best estimate of the impact of the Act in its income tax provision for the year ended December 31, 2017 in accordance with its understanding of the Act and guidance available as of the date of the filing of the 2017 Form 10-K, and as a result, recorded $28.4 million of additional income tax expense in the fourth quarter of 2017, the period in which the legislation was enacted. This provisional income tax expense was comprised of a $36.0 million tax benefit for the remeasurement of deferred tax assets and liabilities to the 21% rate at which they were expected to reverse, offset by $29.1 million for a one-time tax expense on deemed repatriation, and a $35.3 million valuation allowance recorded against foreign tax credit carryovers that we no longer expect to be able to realize based upon the new tax law. |
• | We recognized a net tax benefit of $27.1 million resulting from a non-taxable translation gain associated with a debt instrument that was treated as a loan for U.S. GAAP purposes but as equity for tax purposes. |
Percentage Change | |||||||||||||||||
2018 | 2017 | 2016 | 2018 vs. 2017 | 2017 vs. 2016 | |||||||||||||
(In thousands, except percentages) | |||||||||||||||||
Adjusted Revenues | $ | 2,591,980 | $ | 2,388,643 | $ | 2,357,805 | 8.5 | % | 1.3 | % | |||||||
Adjusted EBITDA | 474,162 | 434,276 | 431,201 | 9.2 | % | 0.7 | % | ||||||||||
as a percent of adjusted revenues | 18.3 | % | 18.2 | % | 18.3 | % |
• | Acquisitions contributed $130.5 million to the increase in adjusted revenues. |
• | Higher sales volume resulted in a $75.7 million increase in adjusted revenues. |
• | Currency translation had a $14.8 million favorable impact on adjusted revenues. |
• | Higher copper costs contributed $10.1 million to the increase in adjusted revenues. |
• | The divestiture of our MCS business resulted in a $27.7 million decrease in adjusted revenues. |
• | Acquisitions contributed $30.8 million to the increase in adjusted revenues. |
• | Higher copper costs contributed $13.0 million to the increase in adjusted revenues. |
• | Currency translation had a $12.2 million favorable impact on adjusted revenues. |
• | Lower sales volume resulted in a $25.2 million decrease in adjusted revenues. |
Percentage Change | |||||||||||||||||
2018 | 2017 | 2016 | 2018 vs. 2017 | 2017 vs. 2016 | |||||||||||||
(In thousands, except percentages) | |||||||||||||||||
Segment Revenues | $ | 1,522,178 | $ | 1,356,305 | $ | 1,372,941 | 12.2 | % | (1.2 | )% | |||||||
Segment EBITDA | 267,656 | 216,558 | 239,978 | 23.6 | % | (9.8 | )% | ||||||||||
as a percent of segment revenues | 17.6 | % | 16.0 | % | 17.5 | % |
Percentage Change | |||||||||||||||||
2018 | 2017 | 2016 | 2018 vs. 2017 | 2017 vs. 2016 | |||||||||||||
(In thousands, except percentages) | |||||||||||||||||
Segment Revenues | $ | 1,069,802 | $ | 1,032,338 | $ | 984,864 | 3.6 | % | 4.8 | % | |||||||
Segment EBITDA | 207,724 | 214,190 | 193,811 | (3.0 | )% | 10.5 | % | ||||||||||
as a percent of segment revenues | 19.4 | % | 20.7 | % | 19.7 | % |
Years Ended December 31, | |||||||
2018 | 2017 | ||||||
(In thousands) | |||||||
Net cash provided by (used for): | |||||||
Operating activities | $ | 289,220 | $ | 255,300 | |||
Investing activities | (140,676 | ) | (230,118 | ) | |||
Financing activities | (281,770 | ) | (331,448 | ) | |||
Effects of currency exchange rate changes on cash and cash equivalents | (7,272 | ) | 19,258 | ||||
Decrease in cash and cash equivalents | (140,498 | ) | (287,008 | ) | |||
Cash and cash equivalents, beginning of year | 561,108 | 848,116 | |||||
Cash and cash equivalents, end of year | $ | 420,610 | $ | 561,108 |
Total | Less than 1 Year | 1-3 Years | 4-5 Years | More than 5 Years | |||||||||||||||
(In thousands) | |||||||||||||||||||
Long-term debt payment obligations (1)(2) | 1,485,900 | $ | — | $ | — | $ | — | $ | 1,485,900 | ||||||||||
Interest payments on long-term debt obligations | 455,700 | 52,149 | 104,299 | 104,299 | 194,953 | ||||||||||||||
Operating lease obligations (3) | 100,926 | 19,877 | 32,307 | 19,971 | 28,771 | ||||||||||||||
Purchase obligations (4) | 30,248 | 30,248 | — | — | — | ||||||||||||||
Other commitments (5) | 8,292 | 1,792 | 5,725 | 775 | — | ||||||||||||||
Pension and other postemployment obligations | 83,014 | 7,729 | 15,818 | 17,287 | 42,180 | ||||||||||||||
Total | $ | 2,164,080 | $ | 111,795 | $ | 158,149 | $ | 142,332 | $ | 1,751,804 |
(1) | As described in Note 13 to the Consolidated Financial Statements. |
(2) | Amounts do not include accrued and unpaid interest. Accrued and unpaid interest related to long-term debt obligations is reflected on the line entitled, "Interest payments on long-term debt obligations" in the table. |
(3) | As described in Note 22 to the Consolidated Financial Statements. |
(4) | Includes agreements to purchase goods or services that are enforceable and legally binding on us and that specify all significant terms, including fixed or minimum quantities to be purchased; fixed, minimum, or variable price provisions; and the approximate timing of the transaction. |
(5) | Does not include accounts payable reflected in the financial statements. Includes obligations for uncertain tax positions and legal settlement obligations (see Notes 15 and 27 to the Consolidated Financial Statements). |
Total | Less than 1 Year | 1-3 Years | 3-5 Years | More than 5 Years | |||||||||||||||
(In thousands) | |||||||||||||||||||
Standby financial letters of credit | $ | 7,467 | $ | 7,184 | $ | 283 | $ | — | $ | — | |||||||||
Bank guarantees | 3,957 | 2,561 | 1,396 | — | — | ||||||||||||||
Surety bonds | 2,360 | 2,360 | — | — | — | ||||||||||||||
Total | $ | 13,784 | $ | 12,105 | $ | 1,679 | $ | — | $ | — |
Purchase Amount | Fair Value | ||||||
(In thousands, except average price) | |||||||
Unconditional copper purchase obligations: | |||||||
Commitment volume in pounds | 1,807 | ||||||
Weighted average price per pound | $ | 2.76 | |||||
Commitment amounts | $ | 4,994 | $ | 4,770 |
Principal Amount by Expected Maturity | Fair Value | ||||||||||||||
2019 | Thereafter | Total | |||||||||||||
(In thousands, except interest rates) | |||||||||||||||
€350.0 million fixed-rate senior subordinated notes due 2028 | $ | — | $ | 400,050 | $ | 400,050 | $ | 390,777 | |||||||
Average interest rate | 3.875 | % | |||||||||||||
€450.0 million fixed-rate senior subordinated notes due 2027 | $ | — | $ | 514,350 | $ | 514,350 | $ | 523,912 | |||||||
Average interest rate | 3.375 | % | |||||||||||||
€200.0 million fixed-rate senior subordinated notes due 2026 | $ | — | $ | 228,600 | $ | 228,600 | $ | 225,171 | |||||||
Average interest rate | 4.125 | % | |||||||||||||
€300.0 million fixed-rate senior subordinated notes due 2025 | $ | — | $ | 342,900 | $ | 342,900 | $ | 345,136 | |||||||
Average interest rate | 2.875 | % | |||||||||||||
Total | $ | 1,485,900 | $ | 1,484,996 |
December 31, | |||||||
2018 | 2017 | ||||||
(In thousands, except par value) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 420,610 | $ | 561,108 | |||
Receivables, net | 465,939 | 473,570 | |||||
Inventories, net | 316,418 | 297,226 | |||||
Other current assets | 55,757 | 40,167 | |||||
Total current assets | 1,258,724 | 1,372,071 | |||||
Property, plant and equipment, less accumulated depreciation | 365,970 | 337,322 | |||||
Goodwill | 1,557,653 | 1,478,257 | |||||
Intangible assets, less accumulated amortization | 511,093 | 545,207 | |||||
Deferred income taxes | 56,018 | 42,549 | |||||
Other long-lived assets | 29,863 | 65,207 | |||||
$ | 3,779,321 | $ | 3,840,613 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 352,646 | $ | 376,277 | |||
Accrued liabilities | 364,276 | 302,651 | |||||
Total current liabilities | 716,922 | 678,928 | |||||
Long-term debt | 1,463,200 | 1,560,748 | |||||
Postretirement benefits | 132,791 | 102,085 | |||||
Deferred income taxes | 39,943 | 27,713 | |||||
Other long-term liabilities | 38,877 | 36,273 | |||||
Stockholders’ equity: | |||||||
Preferred stock, par value $0.01 per share— 2,000 shares authorized; 52 shares outstanding | 1 | 1 | |||||
Common stock, par value $0.01 per share— 200,000 shares authorized; 50,335 shares issued; 39,396 and 42,019 shares outstanding at 2018 and 2017, respectively | 503 | 503 | |||||
Additional paid-in capital | 1,139,395 | 1,123,832 | |||||
Retained earnings | 922,000 | 833,610 | |||||
Accumulated other comprehensive loss | (74,907 | ) | (98,026 | ) | |||
Treasury stock, at cost— 10,939 and 8,316 shares at 2018 and 2017, respectively | (599,845 | ) | (425,685 | ) | |||
Total Belden stockholders’ equity | 1,387,147 | 1,434,235 | |||||
Noncontrolling interest | 441 | 631 | |||||
Total stockholders’ equity | 1,387,588 | 1,434,866 | |||||
$ | 3,779,321 | $ | 3,840,613 |
Years Ended December 31, | |||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands, except per share amounts) | |||||||||||
Revenues | $ | 2,585,368 | $ | 2,388,643 | $ | 2,356,672 | |||||
Cost of sales | (1,576,956 | ) | (1,453,890 | ) | (1,375,351 | ) | |||||
Gross profit | 1,008,412 | 934,753 | 981,321 | ||||||||
Selling, general and administrative expenses | (525,918 | ) | (461,022 | ) | (486,403 | ) | |||||
Research and development expenses | (140,585 | ) | (134,330 | ) | (140,519 | ) | |||||
Amortization of intangibles | (98,829 | ) | (103,997 | ) | (98,385 | ) | |||||
Gain from patent litigation | 62,141 | — | — | ||||||||
Impairment of assets held for sale | — | — | (23,931 | ) | |||||||
Operating income | 305,221 | 235,404 | 232,083 | ||||||||
Interest expense, net | (61,559 | ) | (82,901 | ) | (95,050 | ) | |||||
Non-operating pension cost | (342 | ) | (714 | ) | (8,230 | ) | |||||
Loss on debt extinguishment | (22,990 | ) | (52,441 | ) | (2,342 | ) | |||||
Income before taxes | 220,330 | 99,348 | 126,461 | ||||||||
Income tax benefit (expense) | (59,619 | ) | (6,495 | ) | 1,185 | ||||||
Net income | 160,711 | 92,853 | 127,646 | ||||||||
Less: Net loss attributable to noncontrolling interest | (183 | ) | (357 | ) | (357 | ) | |||||
Net income attributable to Belden | 160,894 | 93,210 | 128,003 | ||||||||
Less: Preferred stock dividends | 34,931 | 34,931 | 15,428 | ||||||||
Net income attributable to Belden common stockholders | $ | 125,963 | $ | 58,279 | $ | 112,575 | |||||
Weighted average number of common shares and equivalents: | |||||||||||
Basic | 40,675 | 42,220 | 42,093 | ||||||||
Diluted | 40,956 | 42,643 | 42,557 | ||||||||
Basic income per share attributable to Belden common stockholders: | $ | 3.10 | $ | 1.38 | $ | 2.67 | |||||
Diluted income per share attributable to Belden common stockholders: | $ | 3.08 | $ | 1.37 | $ | 2.65 | |||||
Years Ended December 31, | |||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands) | |||||||||||
Net income | $ | 160,711 | $ | 92,853 | $ | 127,646 | |||||
Foreign currency translation, net of tax of $1.7 million, $1.3 million, and $1.2 million, respectively | 27,802 | (65,046 | ) | 18,687 | |||||||
Adjustments to pension and postretirement liability, net of tax of $1.0 million, $2.2 million, and $1.9 million, respectively | (4,690 | ) | 6,071 | 1,170 | |||||||
Other comprehensive income (loss), net of tax | 23,112 | (58,975 | ) | 19,857 | |||||||
Comprehensive income | 183,823 | 33,878 | 147,503 | ||||||||
Less: Comprehensive loss attributable to noncontrolling interest | (190 | ) | (373 | ) | (420 | ) | |||||
Comprehensive income attributable to Belden | $ | 184,013 | $ | 34,251 | $ | 147,923 |
Years Ended December 31, | |||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands) | |||||||||||
Cash flows from operating activities: | |||||||||||
Net income | $ | 160,711 | $ | 92,853 | $ | 127,646 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | 148,632 | 149,650 | 145,593 | ||||||||
Impairment of assets held for sale | — | — | 23,931 | ||||||||
Share-based compensation | 18,497 | 14,647 | 18,178 | ||||||||
Loss on debt extinguishment | 22,990 | 52,441 | 2,342 | ||||||||
Deferred income tax expense (benefit) | 11,300 | (24,098 | ) | (30,034 | ) | ||||||
Changes in operating assets and liabilities, net of the effects of currency exchange rate changes and acquired businesses: | |||||||||||
Receivables | (21,748 | ) | (24,931 | ) | (10,115 | ) | |||||
Inventories | (14,779 | ) | (84,088 | ) | 2,677 | ||||||
Accounts payable | (29,401 | ) | 100,752 | 39,298 | |||||||
Accrued liabilities | 17,238 | (25,076 | ) | (13,181 | ) | ||||||
Income taxes | (4,390 | ) | 5,001 | 11,722 | |||||||
Other assets | (18,748 | ) | (13,255 | ) | 760 | ||||||
Other liabilities | (1,082 | ) | 11,404 | (4,023 | ) | ||||||
Net cash provided by operating activities | 289,220 | 255,300 | 314,794 | ||||||||
Cash flows from investing activities: | |||||||||||
Capital expenditures | (97,847 | ) | (64,261 | ) | (53,974 | ) | |||||
Cash used to acquire businesses, net of cash acquired | (84,580 | ) | (166,896 | ) | (18,848 | ) | |||||
Other | — | — | (827 | ) | |||||||
Proceeds from disposal of tangible assets | 1,580 | 1,039 | 392 | ||||||||
Proceeds from disposal of business | 40,171 | — | — | ||||||||
Net cash used for investing activities | (140,676 | ) | (230,118 | ) | (73,257 | ) | |||||
Cash flows from financing activities: | |||||||||||
Payments under borrowing arrangements | (484,757 | ) | (1,105,892 | ) | (294,375 | ) | |||||
Payments under share repurchase program | (175,000 | ) | (25,000 | ) | — | ||||||
Cash dividends paid | (43,169 | ) | (43,376 | ) | (16,079 | ) | |||||
Debt issuance costs paid | (7,609 | ) | (17,316 | ) | (3,910 | ) | |||||
Withholding tax payments for share based-payment awards | (2,094 | ) | (6,564 | ) | (7,480 | ) | |||||
Redemption of stockholders' rights agreement | (411 | ) | — | — | |||||||
Proceeds from the issuance of preferred stock, net | — | — | 501,498 | ||||||||
Borrowings under credit arrangements | 431,270 | 866,700 | 222,050 | ||||||||
Net cash provided by (used for) financing activities | (281,770 | ) | (331,448 | ) | 401,704 | ||||||
Effect of foreign currency exchange rate changes on cash and cash equivalents | (7,272 | ) | 19,258 | (11,876 | ) | ||||||
Increase (decrease) in cash and cash equivalents | (140,498 | ) | (287,008 | ) | 631,365 | ||||||
Cash and cash equivalents, beginning of period | 561,108 | 848,116 | 216,751 | ||||||||
Cash and cash equivalents, end of period | $ | 420,610 | $ | 561,108 | $ | 848,116 |
Belden Inc. Stockholders | ||||||||||||||||||||||||||||||||||||||||
Mandatory Convertible Preferred Stock | Common Stock | Additional Paid-In Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income (Loss) | Non-controlling Interest | Total | |||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2015 | — | $ | — | 50,335 | $ | 503 | $ | 605,660 | $ | 679,716 | (8,354 | ) | $ | (402,793 | ) | $ | (58,987 | ) | $ | 1,424 | $ | 825,523 | ||||||||||||||||||
Net income (loss) | — | — | — | — | 128,003 | — | — | — | (357 | ) | 127,646 | |||||||||||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | — | — | — | 19,920 | (63 | ) | 19,857 | ||||||||||||||||||||||||||||
Preferred stock issuance, net | 52 | 1 | — | — | 501,497 | — | — | — | — | — | 501,498 | |||||||||||||||||||||||||||||
Exercise of stock options, net of tax withholding forfeitures | — | — | — | — | (4,205 | ) | — | 76 | 117 | — | — | (4,088 | ) | |||||||||||||||||||||||||||
Conversion of restricted stock units into common stock, net of tax withholding forfeitures | — | — | — | — | (5,040 | ) | — | 123 | 1,650 | — | — | (3,390 | ) | |||||||||||||||||||||||||||
Share-based compensation related items | — | — | — | — | 18,178 | — | — | — | — | — | 18,178 | |||||||||||||||||||||||||||||
Preferred stock dividends | — | — | — | — | — | (15,428 | ) | — | — | — | — | (15,428 | ) | |||||||||||||||||||||||||||
Common stock dividends ($0.20 per share) | — | — | — | — | — | (8,479 | ) | — | — | — | — | (8,479 | ) | |||||||||||||||||||||||||||
Balance at December 31, 2016 | 52 | $ | 1 | 50,335 | $ | 503 | $ | 1,116,090 | $ | 783,812 | (8,155 | ) | $ | (401,026 | ) | $ | (39,067 | ) | $ | 1,004 | $ | 1,461,317 | ||||||||||||||||||
Net income (loss) | — | — | — | — | — | 93,210 | — | — | — | (357 | ) | 92,853 | ||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | — | — | — | (58,959 | ) | (16 | ) | (58,975 | ) | ||||||||||||||||||||||||||
Exercise of stock options, net of tax withholding forfeitures | — | — | — | — | (2,635 | ) | — | 55 | (203 | ) | — | — | (2,838 | ) | ||||||||||||||||||||||||||
Conversion of restricted stock units into common stock, net of tax withholding forfeitures | — | — | — | — | (4,270 | ) | — | 97 | 544 | — | — | (3,726 | ) | |||||||||||||||||||||||||||
Share repurchase program | — | — | — | — | — | — | (313 | ) | (25,000 | ) | — | — | (25,000 | ) | ||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | 14,647 | — | — | — | — | — | 14,647 | |||||||||||||||||||||||||||||
Preferred stock dividends | — | — | — | — | — | (34,931 | ) | — | — | — | — | (34,931 | ) | |||||||||||||||||||||||||||
Common stock dividends ($0.20 per share) | — | — | — | — | — | (8,481 | ) | — | — | — | — | (8,481 | ) | |||||||||||||||||||||||||||
Balance at December 31, 2017 | 52 | $ | 1 | 50,335 | $ | 503 | $ | 1,123,832 | $ | 833,610 | (8,316 | ) | $ | (425,685 | ) | $ | (98,026 | ) | $ | 631 | $ | 1,434,866 | ||||||||||||||||||
Cumulative effect of change in accounting principles | — | — | — | — | — | (29,041 | ) | — | — | — | — | (29,041 | ) | |||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | 160,894 | — | — | — | (183 | ) | 160,711 | ||||||||||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | — | — | — | 23,119 | (7 | ) | 23,112 | ||||||||||||||||||||||||||||
Exercise of stock options, net of tax withholding forfeitures | — | — | — | — | (883 | ) | — | 20 | 118 | — | — | (765 | ) | |||||||||||||||||||||||||||
Conversion of restricted stock units into common stock, net of tax withholding forfeitures | — | — | — | — | (2,051 | ) | — | 51 | 722 | — | — | (1,329 | ) | |||||||||||||||||||||||||||
Share repurchase program | — | — | — | — | — | — | (2,694 | ) | (175,000 | ) | — | — | (175,000 | ) | ||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | 18,497 | — | — | — | — | — | 18,497 | |||||||||||||||||||||||||||||
Redemption of stockholders' rights agreement | — | — | — | — | — | (411 | ) | — | — | — | — | (411 | ) | |||||||||||||||||||||||||||
Preferred stock dividends | — | — | — | — | — | (34,931 | ) | — | — | — | — | (34,931 | ) | |||||||||||||||||||||||||||
Common stock dividends ($0.20 per share) | — | — | — | — | — | (8,121 | ) | — | — | — | — | (8,121 | ) | |||||||||||||||||||||||||||
Balance at December 31, 2018 | 52 | $ | 1 | 50,335 | $ | 503 | $ | 1,139,395 | $ | 922,000 | (10,939 | ) | $ | (599,845 | ) | $ | (74,907 | ) | $ | 441 | $ | 1,387,588 |
• | Level 1 – Quoted prices in active markets that are unadjusted and accessible at the measurement date for identical, unrestricted assets or liabilities; |
• | Level 2 – Quoted prices for identical assets and liabilities in markets that are not active, quoted prices for similar assets and liabilities in active markets, or financial instruments for which significant inputs are observable, either directly or indirectly; and |
• | Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. |
Cable & Connectivity | Networking, Software & Security | Total Revenues | ||||||||||
Year Ended December 31, 2018 | ||||||||||||
Enterprise Solutions | $ | 1,046,744 | $ | 468,822 | $ | 1,515,566 | ||||||
Industrial Solutions | 662,742 | 407,060 | 1,069,802 | |||||||||
Total | $ | 1,709,486 | $ | 875,882 | $ | 2,585,368 | ||||||
Year Ended December 31, 2017 | ||||||||||||
Enterprise Solutions | $ | 1,024,090 | $ | 332,215 | $ | 1,356,305 | ||||||
Industrial Solutions | 628,889 | 403,449 | 1,032,338 | |||||||||
Total | $ | 1,652,979 | $ | 735,664 | $ | 2,388,643 | ||||||
Year Ended December 31, 2016 | ||||||||||||
Enterprise Solutions | $ | 1,003,799 | $ | 368,009 | $ | 1,371,808 | ||||||
Industrial Solutions | 590,462 | 394,402 | 984,864 | |||||||||
Total | $ | 1,594,261 | $ | 762,411 | $ | 2,356,672 |
Americas | EMEA | APAC | Total Revenues | |||||||||||||
Year Ended December 31, 2018 | ||||||||||||||||
Enterprise Solutions | $ | 981,822 | $ | 294,129 | $ | 239,615 | $ | 1,515,566 | ||||||||
Industrial Solutions | 619,721 | 290,607 | 159,474 | 1,069,802 | ||||||||||||
Total | $ | 1,601,543 | $ | 584,736 | $ | 399,089 | $ | 2,585,368 | ||||||||
Year Ended December 31, 2017 | ||||||||||||||||
Enterprise Solutions | $ | 925,647 | $ | 214,763 | $ | 215,895 | $ | 1,356,305 | ||||||||
Industrial Solutions | 606,331 | 280,890 | 145,117 | 1,032,338 | ||||||||||||
Total | $ | 1,531,978 | $ | 495,653 | $ | 361,012 | $ | 2,388,643 | ||||||||
Year Ended December 31, 2016 | ||||||||||||||||
Enterprise Solutions | $ | 937,741 | $ | 220,511 | $ | 213,556 | $ | 1,371,808 | ||||||||
Industrial Solutions | 596,032 | 261,055 | 127,777 | 984,864 | ||||||||||||
Total | $ | 1,533,773 | $ | 481,566 | $ | 341,333 | $ | 2,356,672 |
Products | Support & Services | Total Revenues | ||||||||||
Year Ended December 31, 2018 | ||||||||||||
Enterprise Solutions | $ | 1,441,757 | $ | 73,809 | $ | 1,515,566 | ||||||
Industrial Solutions | 974,029 | 95,773 | 1,069,802 | |||||||||
Total | $ | 2,415,786 | $ | 169,582 | $ | 2,585,368 | ||||||
Year Ended December 31, 2017 | ||||||||||||
Enterprise Solutions | $ | 1,281,960 | $ | 74,345 | $ | 1,356,305 | ||||||
Industrial Solutions | 929,263 | 103,075 | 1,032,338 | |||||||||
Total | $ | 2,211,223 | $ | 177,420 | $ | 2,388,643 | ||||||
Year Ended December 31, 2016 | ||||||||||||
Enterprise Solutions | $ | 1,293,392 | $ | 78,416 | $ | 1,371,808 | ||||||
Industrial Solutions | 885,208 | 99,656 | 984,864 | |||||||||
Total | $ | 2,178,600 | $ | 178,072 | $ | 2,356,672 |
Receivables | $ | 16,551 | ||
Inventory | 15,084 | |||
Prepaid and other current assets | 3,799 | |||
Property, plant, and equipment | 7,716 | |||
Intangible assets | 51,000 | |||
Goodwill | 102,715 | |||
Deferred income taxes | 1,388 | |||
Other long-lived assets | 3,046 | |||
Total assets acquired | $ | 201,299 | ||
Accounts payable | $ | 11,825 | ||
Accrued liabilities | 24,405 | |||
Deferred revenue | 8,860 | |||
Long-term debt | 19,315 | |||
Postretirement benefits | 31,774 | |||
Other long-term liabilities | 591 | |||
Total liabilities assumed | $ | 96,770 | ||
Net assets | $ | 104,529 |
Preliminary Fair Value | Amortization Period | |||||
(In thousands) | (In years) | |||||
Intangible assets subject to amortization: | ||||||
Developed technologies | $ | 36,500 | 5.0 | |||
Customer relationships | 11,000 | 12.0 | ||||
Sales backlog | 1,900 | 0.3 | ||||
Trademarks | 1,600 | 0.9 | ||||
Total intangible assets subject to amortization | $ | 51,000 | ||||
Intangible assets not subject to amortization: | ||||||
Goodwill | $ | 102,715 | n/a | |||
Total intangible assets not subject to amortization | $ | 102,715 | ||||
Total intangible assets | $ | 153,715 | ||||
Weighted average amortization period | 6.2 years |
Years Ended December 31, | ||||||||
2018 | 2017 | |||||||
(In thousands, except per share data) (Unaudited) | ||||||||
Revenues | $ | 2,598,741 | $ | 2,500,779 | ||||
Net income (loss) attributable to Belden common stockholders | 168,819 | (8,581 | ) | |||||
Diluted income (loss) per share attributable to Belden common stockholders | $ | 4.12 | $ | (0.20 | ) |
Receivables | $ | 4,355 | ||
Inventory | 16,424 | |||
Prepaid and other current assets | 320 | |||
Property, plant, and equipment | 4,289 | |||
Intangible assets | 73,400 | |||
Goodwill | 70,654 | |||
Deferred income taxes | 598 | |||
Total assets acquired | $ | 170,040 | ||
Accounts payable | $ | 1,231 | ||
Accrued liabilities | 1,353 | |||
Deferred revenue | 1,702 | |||
Total liabilities assumed | $ | 4,286 | ||
Net assets | $ | 165,754 |
Fair Value | Amortization Period | |||||
(In thousands) | (In years) | |||||
Intangible assets subject to amortization: | ||||||
Developed technologies | $ | 62,600 | 10.0 | |||
Customer relationships | 6,500 | 8.0 | ||||
Trademarks | 2,900 | 10.0 | ||||
Sales backlog | 1,400 | 0.3 | ||||
Total intangible assets subject to amortization | $ | 73,400 | ||||
Intangible assets not subject to amortization: | ||||||
Goodwill | $ | 70,654 | n/a | |||
Total intangible assets not subject to amortization | $ | 70,654 | ||||
Total intangible assets | $ | 144,054 | ||||
Weighted average amortization period | 9.6 years |
Years Ended December 31, | ||||||||
2017 | 2016 | |||||||
(In thousands, except per share data) (Unaudited) | ||||||||
Revenues | $ | 2,399,715 | $ | 2,407,830 | ||||
Net income attributable to Belden common stockholders | 60,690 | 113,014 | ||||||
Diluted income per share attributable to Belden common stockholders | $ | 1.42 | $ | 2.66 |
Enterprise Solutions | Years ended December 31, | ||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands) | |||||||||||
Segment revenues | $ | 1,522,178 | $ | 1,356,305 | $ | 1,372,941 | |||||
Affiliate revenues | 6,085 | 5,091 | 2,799 | ||||||||
Segment EBITDA | 267,656 | 216,558 | 239,978 | ||||||||
Depreciation expense | 28,861 | 26,272 | 29,455 | ||||||||
Amortization of intangibles | 45,944 | 51,054 | 48,966 | ||||||||
Amortization of software development intangible assets | 2,180 | 56 | — | ||||||||
Severance, restructuring, and acquisition integration costs | 57,563 | 29,043 | 18,561 | ||||||||
Purchase accounting effects of acquisitions | 3,497 | 6,133 | (2,079 | ) | |||||||
Deferred revenue adjustments | 6,612 | — | 1,774 | ||||||||
Patent settlement | — | — | (5,554 | ) | |||||||
Acquisition of property, plant and equipment | 65,619 | 49,440 | 38,392 | ||||||||
Segment assets | 761,309 | 687,914 | 571,960 |
Industrial Solutions | Years ended December 31, | ||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands) | |||||||||||
Segment revenues | $ | 1,069,802 | $ | 1,032,338 | $ | 984,864 | |||||
Affiliate revenues | 81 | 67 | 71 | ||||||||
Segment EBITDA | 207,724 | 214,190 | 193,811 | ||||||||
Depreciation expense | 18,754 | 19,325 | 17,753 | ||||||||
Amortization of intangibles | 52,885 | 52,943 | 49,419 | ||||||||
Amortization of software development intangible assets | 8 | — | — | ||||||||
Severance, restructuring, and acquisition integration costs | 11,050 | 13,747 | 12,579 | ||||||||
Deferred revenue adjustments | — | — | 4,913 | ||||||||
Acquisition of property, plant and equipment | 29,215 | 13,319 | 15,190 | ||||||||
Segment assets | 458,801 | 458,481 | 342,038 |
Total Segments | Years ended December 31, | ||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands) | |||||||||||
Segment revenues | $ | 2,591,980 | $ | 2,388,643 | $ | 2,357,805 | |||||
Affiliate revenues | 6,166 | 5,158 | 2,870 | ||||||||
Segment EBITDA | 475,380 | 430,748 | 433,789 | ||||||||
Depreciation expense | 47,615 | 45,597 | 47,208 | ||||||||
Amortization of intangibles | 98,829 | 103,997 | 98,385 | ||||||||
Amortization of software development intangible assets | 2,188 | 56 | — | ||||||||
Severance, restructuring, and acquisition integration costs | 68,613 | 42,790 | 31,140 | ||||||||
Purchase accounting effects of acquisitions | 3,497 | 6,133 | (2,079 | ) | |||||||
Deferred revenue adjustments | 6,612 | — | 6,687 | ||||||||
Patent settlement | — | — | (5,554 | ) | |||||||
Acquisition of property, plant and equipment | 94,834 | 62,759 | 53,582 | ||||||||
Segment assets | 1,220,110 | 1,146,395 | 913,998 |
Years Ended December 31, | |||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands) | |||||||||||
Total Segment Revenues | $ | 2,591,980 | $ | 2,388,643 | $ | 2,357,805 | |||||
Deferred revenue adjustments (1) | (6,612 | ) | — | (6,687 | ) | ||||||
Patent settlement (2) | — | — | 5,554 | ||||||||
Consolidated Revenues | $ | 2,585,368 | $ | 2,388,643 | $ | 2,356,672 | |||||
Total Segment EBITDA | $ | 475,380 | $ | 430,748 | $ | 433,789 | |||||
Amortization of intangibles | (98,829 | ) | (103,997 | ) | (98,385 | ) | |||||
Severance, restructuring, and acquisition integration costs (3) | (68,613 | ) | (42,790 | ) | (31,140 | ) | |||||
Depreciation expense | (47,615 | ) | (45,597 | ) | (47,208 | ) | |||||
Deferred revenue adjustments (1) | (6,612 | ) | — | (6,687 | ) | ||||||
Purchase accounting effects related to acquisitions (4) | (3,497 | ) | (6,133 | ) | 2,079 | ||||||
Costs related to patent litigation | (2,634 | ) | — | — | |||||||
Amortization of software development intangible assets | (2,188 | ) | (56 | ) | — | ||||||
Loss on sale of assets (5) | (94 | ) | (1,013 | ) | — | ||||||
Impairment of assets held for sale (5) | — | — | (23,931 | ) | |||||||
Patent settlement (2) | — | — | 5,554 | ||||||||
Income from equity method investment | — | 7,502 | 1,793 | ||||||||
Gain from patent litigation | 62,141 | — | — | ||||||||
Eliminations | (2,218 | ) | (3,260 | ) | (3,781 | ) | |||||
Consolidated operating income | 305,221 | 235,404 | 232,083 | ||||||||
Interest expense, net | (61,559 | ) | (82,901 | ) | (95,050 | ) | |||||
Non-operating pension cost | (342 | ) | (714 | ) | (8,230 | ) | |||||
Loss on debt extinguishment | (22,990 | ) | (52,441 | ) | (2,342 | ) | |||||
Consolidated income before taxes | $ | 220,330 | $ | 99,348 | $ | 126,461 |
(1) | Our segment results include revenues that would have been recorded by acquired businesses had they remained as independent entities. Our consolidated results do not include these revenues due to the purchase accounting effect of recording deferred revenue at fair value. See Note 4, Acquisitions, for details. |
(2) | Both our consolidated revenues and gross profit were positively impacted by royalty revenues received during 2016 that related to years prior to 2016 as a result of a patent settlement. |
(3) | See Note 12, Severance, Restructuring, and Acquisition Integration Activities, for details. |
(4) | In 2018, we recognized $3.5 million of cost of sales related to purchase accounting adjustments, most of which was for the adjustment of acquired inventory to fair value for our SAM and NT2 acquisitions. In 2017, we recognized $6.1 million of cost of sales related to the adjustment of acquired inventory to fair value for our Thinklogical acquisition. In 2016, we made a $3.2 million adjustment to reduce the earn-out liability associated with the M2FX acquisition. This adjustment was partially offset by $0.8 million and $0.2 million of cost of sales related to the adjustment of acquired inventory to fair value related to our Enterprise segment and M2FX acquisition, respectively. |
(5) | In 2018, 2017, and 2016, we recognized a $0.1 million loss on sale of assets, $1.0 million loss on sale of assets, and $23.9 million impairment of assets held for sale, respectively, for the sale of our MCS business and Hirschmann JV. |
Years Ended December 31, | |||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands) | |||||||||||
Total segment assets | $ | 1,220,110 | $ | 1,146,395 | $ | 913,998 | |||||
Cash and cash equivalents | 420,610 | 561,108 | 848,116 | ||||||||
Goodwill | 1,557,653 | 1,478,257 | 1,385,995 | ||||||||
Intangible assets, less accumulated amortization | 511,093 | 545,207 | 560,082 | ||||||||
Deferred income taxes | 56,018 | 42,549 | 33,706 | ||||||||
Corporate assets | 13,837 | 67,097 | 64,906 | ||||||||
Total assets | $ | 3,779,321 | $ | 3,840,613 | $ | 3,806,803 | |||||
Total segment acquisition of property, plant and equipment | $ | 94,834 | $ | 62,759 | $ | 53,582 | |||||
Corporate acquisition of property, plant and equipment | 3,013 | 1,502 | 392 | ||||||||
Total acquisition of property, plant and equipment | $ | 97,847 | $ | 64,261 | $ | 53,974 |
United States | Canada | China | Germany | All Other | Total | ||||||||||||||||||
(In thousands, except percentages) | |||||||||||||||||||||||
Year ended December 31, 2018 | |||||||||||||||||||||||
Revenues | $ | 1,324,653 | $ | 174,727 | $ | 132,544 | $ | 117,598 | $ | 835,846 | $ | 2,585,368 | |||||||||||
Percent of total revenues | 51 | % | 7 | % | 5 | % | 5 | % | 32 | % | 100 | % | |||||||||||
Long-lived assets | $ | 189,211 | $ | 32,312 | $ | 37,227 | $ | 39,870 | $ | 97,213 | $ | 395,833 | |||||||||||
Year ended December 31, 2017 | |||||||||||||||||||||||
Revenues | $ | 1,265,455 | $ | 167,605 | $ | 121,600 | $ | 113,990 | $ | 719,993 | $ | 2,388,643 | |||||||||||
Percent of total revenues | 53 | % | 7 | % | 5 | % | 5 | % | 30 | % | 100 | % | |||||||||||
Long-lived assets | $ | 231,938 | $ | 33,806 | $ | 34,774 | $ | 38,029 | $ | 63,982 | $ | 402,529 | |||||||||||
Year ended December 31, 2016 | |||||||||||||||||||||||
Revenues | $ | 1,283,925 | $ | 159,985 | $ | 114,605 | $ | 104,214 | $ | 693,943 | $ | 2,356,672 | |||||||||||
Percent of total revenues | 55 | % | 7 | % | 5 | % | 4 | % | 29 | % | 100 | % | |||||||||||
Long-lived assets | $ | 193,263 | $ | 31,278 | $ | 30,487 | $ | 32,386 | $ | 60,654 | $ | 348,068 |
Years Ended December 31, | |||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands) | |||||||||||
Numerator: | |||||||||||
Net income | $ | 160,711 | $ | 92,853 | $ | 127,646 | |||||
Less: Net loss attributable to noncontrolling interest | (183 | ) | (357 | ) | (357 | ) | |||||
Less: Preferred stock dividends | 34,931 | 34,931 | 15,428 | ||||||||
Net income attributable to Belden common stockholders | $ | 125,963 | $ | 58,279 | $ | 112,575 | |||||
Denominator: | |||||||||||
Weighted average shares outstanding, basic | 40,675 | 42,220 | 42,093 | ||||||||
Effect of dilutive common stock equivalents | 281 | 423 | 464 | ||||||||
Weighted average shares outstanding, diluted | 40,956 | 42,643 | 42,557 |
December 31, | |||||||
2018 | 2017 | ||||||
(In thousands) | |||||||
Raw materials | $ | 146,803 | $ | 133,311 | |||
Work-in-process | 45,939 | 35,807 | |||||
Finished goods | 152,572 | 153,377 | |||||
Gross inventories | 345,314 | 322,495 | |||||
Excess and obsolete reserves | (28,896 | ) | (25,269 | ) | |||
Net inventories | $ | 316,418 | $ | 297,226 |
December 31, | |||||||
2018 | 2017 | ||||||
(In thousands) | |||||||
Land and land improvements | $ | 30,173 | $ | 31,963 | |||
Buildings and leasehold improvements | 141,009 | 148,598 | |||||
Machinery and equipment | 569,359 | 543,594 | |||||
Computer equipment and software | 139,773 | 136,509 | |||||
Construction in process | 64,145 | 46,898 | |||||
Gross property, plant and equipment | 944,459 | 907,562 | |||||
Accumulated depreciation | (578,489 | ) | (570,240 | ) | |||
Net property, plant and equipment | $ | 365,970 | $ | 337,322 |
December 31, 2018 | December 31, 2017 | ||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||
(In thousands) | (In thousands) | ||||||||||||||||||||||
Goodwill | $ | 1,557,653 | $ | — | $ | 1,557,653 | $ | 1,478,257 | $ | — | $ | 1,478,257 | |||||||||||
Definite-lived intangible assets subject to amortization: | |||||||||||||||||||||||
Developed technology | $ | 545,982 | $ | (379,896 | ) | $ | 166,086 | $ | 498,649 | $ | (318,366 | ) | $ | 180,283 | |||||||||
Customer relationships | 331,643 | (115,943 | ) | 215,700 | 320,550 | (98,175 | ) | 222,375 | |||||||||||||||
Trademarks | 57,860 | (27,106 | ) | 30,754 | 56,794 | (18,648 | ) | 38,146 | |||||||||||||||
In-service research and development | 23,833 | (16,471 | ) | 7,362 | 23,428 | (13,483 | ) | 9,945 | |||||||||||||||
Backlog | 15,885 | (15,885 | ) | — | 14,535 | (14,535 | ) | — | |||||||||||||||
Total intangible assets subject to amortization | 975,203 | (555,301 | ) | 419,902 | 913,956 | (463,207 | ) | 450,749 | |||||||||||||||
Indefinite-lived intangible assets not subject to amortization: | |||||||||||||||||||||||
Trademarks | 90,391 | — | 90,391 | 92,758 | — | 92,758 | |||||||||||||||||
In-process research and development | 800 | — | 800 | 1,700 | — | 1,700 | |||||||||||||||||
Total intangible assets not subject to amortization | 91,191 | — | 91,191 | 94,458 | — | 94,458 | |||||||||||||||||
Intangible assets | $ | 1,066,394 | $ | (555,301 | ) | $ | 511,093 | $ | 1,008,414 | $ | (463,207 | ) | $ | 545,207 |
Enterprise Solutions | Industrial Solutions | Consolidated | |||||||||
(In thousands) | |||||||||||
Balance at December 31, 2016 | $ | 617,320 | $ | 768,675 | $ | 1,385,995 | |||||
Acquisitions and purchase accounting adjustments | 71,394 | — | 71,394 | ||||||||
Translation impact | 13,557 | 7,311 | 20,868 | ||||||||
Balance at December 31, 2017 | $ | 702,271 | $ | 775,986 | $ | 1,478,257 | |||||
Acquisitions and purchase accounting adjustments | 105,899 | — | 105,899 | ||||||||
Translation impact | (22,812 | ) | (3,691 | ) | (26,503 | ) | |||||
Balance at December 31, 2018 | $ | 785,358 | $ | 772,295 | $ | 1,557,653 |
Enterprise Solutions | Industrial Solutions | Consolidated | |||||||||
(In thousands) | |||||||||||
Balance at December 31, 2016 | $ | 80,350 | $ | 41,622 | $ | 121,972 | |||||
Translation impact | 2,727 | 1,260 | 3,987 | ||||||||
Reclassify to definite-lived | — | (33,201 | ) | (33,201 | ) | ||||||
Balance at December 31, 2017 | $ | 83,077 | $ | 9,681 | $ | 92,758 | |||||
Translation impact | (1,893 | ) | (474 | ) | (2,367 | ) | |||||
Balance at December 31, 2018 | $ | 81,184 | $ | 9,207 | $ | 90,391 |
December 31, | |||||||
2018 | 2017 | ||||||
(In thousands) | |||||||
Current deferred revenue | $ | 101,194 | $ | 90,639 | |||
Wages, severance and related taxes | 56,129 | 57,633 | |||||
Accrued rebates | 41,312 | 38,025 | |||||
Employee benefits | 25,670 | 25,406 | |||||
Accrued interest | 18,530 | 22,019 | |||||
Other (individual items less than 5% of total current liabilities) | 121,441 | 68,929 | |||||
Accrued liabilities | $ | 364,276 | $ | 302,651 |
Severance | Other Restructuring and Integration Costs | Total Costs | |||||||||
(In thousands) | |||||||||||
Year Ended December 31, 2018 | |||||||||||
Enterprise Solutions | $ | 9,945 | $ | 47,618 | $ | 57,563 | |||||
Industrial Solutions | 378 | 10,672 | 11,050 | ||||||||
Total | $ | 10,323 | $ | 58,290 | $ | 68,613 | |||||
Year Ended December 31, 2017 | |||||||||||
Enterprise Solutions | $ | 4,535 | $ | 24,508 | $ | 29,043 | |||||
Industrial Solutions | 676 | 13,071 | 13,747 | ||||||||
Total | $ | 5,211 | $ | 37,579 | $ | 42,790 | |||||
Year Ended December 31, 2016 | |||||||||||
Enterprise Solutions | $ | 520 | $ | 18,041 | $ | 18,561 | |||||
Industrial Solutions | 6,562 | 6,017 | 12,579 | ||||||||
Total | $ | 7,082 | $ | 24,058 | $ | 31,140 |
December 31, | |||||||
2018 | 2017 | ||||||
(In thousands) | |||||||
Revolving credit agreement due 2022 | $ | — | $ | — | |||
Senior subordinated notes: | |||||||
3.875% Senior subordinated notes due 2028 | 400,050 | — | |||||
3.375% Senior subordinated notes due 2027 | 514,350 | 540,810 | |||||
4.125% Senior subordinated notes due 2026 | 228,600 | 240,360 | |||||
2.875% Senior subordinated notes due 2025 | 342,900 | 360,540 | |||||
5.25% Senior subordinated notes due 2024 | — | 200,000 | |||||
5.50% Senior subordinated notes due 2023 | — | 242,522 | |||||
Total senior subordinated notes | 1,485,900 | 1,584,232 | |||||
Less unamortized debt issuance costs | (22,700 | ) | (23,484 | ) | |||
Long-term debt | $ | 1,463,200 | $ | 1,560,748 |
Senior Subordinated Notes due | ||||||||||||||||||
2025 | 2026 | 2027 | 2028 | |||||||||||||||
Year | Percentage | Year | Percentage | Year | Percentage | Year | Percentage | |||||||||||
2020 | 101.438 | % | 2021 | 102.063 | % | 2022 | 101.688 | % | 2023 | 101.9375 | % | |||||||
2021 | 100.719 | % | 2022 | 101.375 | % | 2023 | 101.125 | % | 2024 | 101.2916 | % | |||||||
2022 and thereafter | 100.000 | % | 2023 | 100.688 | % | 2024 | 100.563 | % | 2025 | 100.6458 | % | |||||||
2024 and thereafter | 100.000 | % | 2025 and thereafter | 100.000 | % | 2026 and thereafter | 100.0000 | % |
2019 | $ | — | |
2020 | — | ||
2021 | — | ||
2022 | — | ||
2023 | — | ||
Thereafter | 1,485,900 | ||
$ | 1,485,900 |
Years ended December 31, | |||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands) | |||||||||||
Income (loss) before taxes: | |||||||||||
United States operations | $ | 126,385 | $ | 2,177 | $ | (25,615 | ) | ||||
Foreign operations | 93,945 | 97,171 | 152,076 | ||||||||
Income before taxes | $ | 220,330 | $ | 99,348 | $ | 126,461 | |||||
Income tax expense (benefit): | |||||||||||
Currently payable | |||||||||||
United States federal | $ | 27,529 | $ | — | $ | 2,981 | |||||
United States state and local | 3,274 | 2,392 | (1,038 | ) | |||||||
Foreign | 17,516 | 28,201 | 26,906 | ||||||||
48,319 | 30,593 | 28,849 | |||||||||
Deferred | |||||||||||
United States federal | 10,942 | (11,028 | ) | (27,677 | ) | ||||||
United States state and local | 703 | (8,758 | ) | (3,139 | ) | ||||||
Foreign | (345 | ) | (4,312 | ) | 782 | ||||||
11,300 | (24,098 | ) | (30,034 | ) | |||||||
Income tax expense (benefit) | $ | 59,619 | $ | 6,495 | $ | (1,185 | ) |
Years Ended December 31, | ||||||||
2018 | 2017 | 2016 | ||||||
Effective income tax rate reconciliation from continuing operations: | ||||||||
United States federal statutory rate | 21.0 | % | 35.0 | % | 35.0 | % | ||
State and local income taxes | 1.7 | % | 0.8 | % | (0.9 | )% | ||
Impact of change in tax contingencies | (1.0 | )% | 2.2 | % | 2.4 | % | ||
Foreign income tax rate differences | (1.8 | )% | (13.1 | )% | (14.0 | )% | ||
Impact of change in deferred tax asset valuation allowance | 2.0 | % | 1.5 | % | (7.3 | )% | ||
Impact of change in legal entity tax status | — | % | — | % | (5.5 | )% | ||
Impact of non-taxable translation gain | — | % | (27.3 | )% | — | % | ||
Impact of non-taxable interest income | — | % | (5.5 | )% | (4.9 | )% | ||
Domestic permanent differences and tax credits | 0.7 | % | (15.7 | )% | (5.7 | )% | ||
Impact of tax reform | 4.5 | % | 28.6 | % | — | % | ||
27.1 | % | 6.5 | % | (0.9 | )% |
December 31, | |||||||
2018 | 2017 | ||||||
(In thousands) | |||||||
Components of deferred income tax balances: | |||||||
Deferred income tax liabilities: | |||||||
Plant, equipment, and intangibles | $ | (114,413 | ) | $ | (120,171 | ) | |
Deferred income tax assets: | |||||||
Postretirement, pensions, and stock compensation | 30,896 | 28,736 | |||||
Reserves and accruals | 25,641 | 29,297 | |||||
Net operating loss and tax credit carryforwards | 164,823 | 228,815 | |||||
Valuation allowances | (90,872 | ) | (151,841 | ) | |||
130,488 | 135,007 | ||||||
Net deferred income tax asset | $ | 16,075 | $ | 14,836 |
Net Operating Loss Carryforwards | |||
(In thousands) | |||
Australia | $ | 12,064 | |
France | 15,538 | ||
Germany | 13,436 | ||
Japan | 20,203 | ||
Luxembourg | 24,252 | ||
Netherlands | 23,889 | ||
Other | 45,171 | ||
United Kingdom | 258,423 | ||
United States - Federal and various states | 124,349 | ||
Total | $ | 537,325 | |
Tax Credit Carryforwards | |||
(In thousands) | |||
United States | $ | 48,859 | |
Canada | 22,181 | ||
Total | $ | 71,040 |
2018 | 2017 | ||||||
(In thousands) | |||||||
Balance at beginning of year | $ | 8,579 | $ | 10,474 | |||
Additions based on tax positions related to the current year | 866 | 981 | |||||
Additions for tax positions of prior years | 1,292 | 2,549 | |||||
Reductions for tax positions of prior years - Settlement | (1,689 | ) | (5,425 | ) | |||
Reduction for tax positions of prior years - Statute of limitations | (1,631 | ) | — | ||||
Balance at end of year | $ | 7,417 | $ | 8,579 |
Pension Benefits | Other Benefits | ||||||||||||||
Years Ended December 31, | 2018 | 2017 | 2018 | 2017 | |||||||||||
(In thousands) | |||||||||||||||
Change in benefit obligation: | |||||||||||||||
Benefit obligation, beginning of year | $ | (272,025 | ) | $ | (256,481 | ) | $ | (30,333 | ) | $ | (32,038 | ) | |||
Service cost | (4,705 | ) | (4,978 | ) | (47 | ) | (49 | ) | |||||||
Interest cost | (11,690 | ) | (7,671 | ) | (945 | ) | (1,139 | ) | |||||||
Participant contributions | (85 | ) | (91 | ) | (6 | ) | (7 | ) | |||||||
Actuarial gain (loss) | 15,032 | (3,291 | ) | 1,681 | 3,370 | ||||||||||
Divestitures (acquisitions) | (185,692 | ) | 794 | — | — | ||||||||||
Settlements | 7,437 | 49 | — | — | |||||||||||
Plan amendments | (2,822 | ) | — | — | — | ||||||||||
Foreign currency exchange rate changes | 23,454 | (14,299 | ) | 2,020 | (2,022 | ) | |||||||||
Benefits paid | 12,849 | 13,943 | 1,487 | 1,552 | |||||||||||
Benefit obligation, end of year | $ | (418,247 | ) | $ | (272,025 | ) | $ | (26,143 | ) | $ | (30,333 | ) |
Pension Benefits | Other Benefits | ||||||||||||||
Years Ended December 31, | 2018 | 2017 | 2018 | 2017 | |||||||||||
(In thousands) | |||||||||||||||
Change in plan assets: | |||||||||||||||
Fair value of plan assets, beginning of year | $ | 198,156 | $ | 182,370 | $ | — | $ | — | |||||||
Actual return on plan assets | (8,364 | ) | 18,746 | — | — | ||||||||||
Employer contributions | 5,397 | 4,425 | 1,481 | 1,545 | |||||||||||
Plan participant contributions | 85 | 91 | 6 | 7 | |||||||||||
Acquisitions | 153,919 | — | — | — | |||||||||||
Settlements | (7,054 | ) | — | — | — | ||||||||||
Foreign currency exchange rate changes | (17,616 | ) | 6,467 | — | — | ||||||||||
Benefits paid | (12,849 | ) | (13,943 | ) | (1,487 | ) | (1,552 | ) | |||||||
Fair value of plan assets, end of year | $ | 311,674 | $ | 198,156 | $ | — | $ | — |
Funded status, end of year | $ | (106,573 | ) | $ | (73,869 | ) | $ | (26,143 | ) | $ | (30,333 | ) | |||
Amounts recognized in the balance sheets: | |||||||||||||||
Prepaid benefit cost | $ | 4,801 | $ | 3,174 | $ | — | $ | — | |||||||
Accrued benefit liability (current) | (3,320 | ) | (3,736 | ) | (1,405 | ) | (1,555 | ) | |||||||
Accrued benefit liability (noncurrent) | (108,054 | ) | (73,307 | ) | (24,738 | ) | (28,778 | ) | |||||||
Net funded status | $ | (106,573 | ) | $ | (73,869 | ) | $ | (26,143 | ) | $ | (30,333 | ) |
Pension Benefits | Other Benefits | ||||||||||||||||||||||
Years Ended December 31, | 2018 | 2017 | 2016 | 2018 | 2017 | 2016 | |||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Components of net periodic benefit cost: | |||||||||||||||||||||||
Service cost | $ | 4,705 | $ | 4,978 | $ | 4,981 | $ | 47 | $ | 49 | $ | 46 | |||||||||||
Interest cost | 11,690 | 7,671 | 8,909 | 945 | 1,139 | 1,259 | |||||||||||||||||
Expected return on plan assets | (16,391 | ) | (10,644 | ) | (12,013 | ) | — | — | — | ||||||||||||||
Amortization of prior service credit | (42 | ) | (41 | ) | (42 | ) | — | — | (42 | ) | |||||||||||||
Curtailment gain | — | — | (227 | ) | — | — | — | ||||||||||||||||
Settlement loss (gain) | 1,342 | (8 | ) | 7,630 | — | — | — | ||||||||||||||||
Net loss (gain) recognition | 2,810 | 2,597 | 2,670 | (12 | ) | — | 86 | ||||||||||||||||
Net periodic benefit cost | $ | 4,114 | $ | 4,553 | $ | 11,908 | $ | 980 | $ | 1,188 | $ | 1,349 |
Pension Benefits | Other Benefits | ||||||||||
Years Ended December 31, | 2018 | 2017 | 2018 | 2017 | |||||||
Weighted average assumptions for benefit obligations at year end: | |||||||||||
Discount rate | 3.1 | % | 2.8 | % | 3.7 | % | 3.3 | % | |||
Salary increase | 3.6 | % | 3.6 | % | N/A | N/A | |||||
Cash balance interest credit rate | 4.7 | % | 4.7 | % | N/A | N/A | |||||
Weighted average assumptions for net periodic cost for the year: | |||||||||||
Discount rate | 2.8 | % | 3.1 | % | 3.3 | % | 3.7 | % | |||
Salary increase | 3.6 | % | 3.6 | % | N/A | N/A | |||||
Cash balance interest credit rate | 4.7 | % | 4.7 | % | N/A | N/A | |||||
Expected return on assets | 5.5 | % | 6.0 | % | N/A | N/A | |||||
Assumed health care cost trend rates: | |||||||||||
Health care cost trend rate assumed for next year | N/A | N/A | 5.8 | % | 6.2 | % | |||||
Rate that the cost trend rate gradually declines to | N/A | N/A | 5.0 | % | 5.0 | % | |||||
Year that the rate reaches the rate it is assumed to remain at | N/A | N/A | 2025 | 2024 |
December 31, 2018 | December 31, 2017 | ||||||||||||||||||||||||||||||
Fair Market Value at December 31, 2018 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Fair Market Value at December 31, 2017 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||||
(In thousands) | (In thousands) | ||||||||||||||||||||||||||||||
Asset Category: | |||||||||||||||||||||||||||||||
Equity securities(a) | |||||||||||||||||||||||||||||||
U.S. equities fund | $ | 96,417 | $ | 1,465 | $ | — | $ | — | $ | 95,425 | $ | — | $ | — | $ | — | |||||||||||||||
Non-U.S. equities fund | 47,274 | 5,755 | — | — | 11,571 | — | — | — | |||||||||||||||||||||||
Debt securities(b) | |||||||||||||||||||||||||||||||
Government bond fund | 66,439 | — | 1,253 | — | 28,429 | — | — | — | |||||||||||||||||||||||
Corporate bond fund | 39,366 | — | 7,116 | — | 24,421 | — | — | — | |||||||||||||||||||||||
Fixed income fund(c) | 41,167 | — | 39,340 | — | 38,072 | — | 38,072 | — | |||||||||||||||||||||||
Other investments(d) | 17,274 | — | — | — | — | — | — | — | |||||||||||||||||||||||
Cash & equivalents | 3,737 | 301 | — | — | 238 | 238 | — | — | |||||||||||||||||||||||
Total | $ | 311,674 | $ | 7,521 | $ | 47,709 | $ | — | $ | 198,156 | $ | 238 | $ | 38,072 | $ | — |
(a) | This category includes investments in actively managed and indexed investment funds that invest in a diversified pool of equity securities of companies located in the U.S., Canada, Western Europe and other developed countries throughout the world. The funds are valued using the net asset value method in which an average of the market prices for the underlying investments is used to value the fund. Equity securities held in separate accounts are valued based on observable quoted prices on active exchanges. Funds which are valued using the net asset value method are not included in the fair value hierarchy. |
(b) | This category includes investments in investment funds that invest in U.S. treasuries; other national, state and local government bonds; and corporate bonds of highly rated companies from diversified industries. The funds are valued using the net asset value method in which an average of the market prices for the underlying investments is used to value the fund. Funds valued using the net asset value method are not included in the fair value hierarchy. |
(c) | This category includes guaranteed insurance contracts and annuity policies. |
(d) | This category includes investments in hedge funds that pursue multiple strategies in order to provide diversification and balance risk/return objectives, real estate funds, and private equity funds. Funds valued using the net asset method are not included in the fair value hierarchy. |
Pension Plans | Other Plans | ||||||
(In thousands) | |||||||
2019 | $ | 21,667 | $ | 1,432 | |||
2020 | 22,965 | 1,436 | |||||
2021 | 22,199 | 1,438 | |||||
2022 | 23,157 | 1,438 | |||||
2023 | 22,081 | 1,432 | |||||
2024-2028 | 111,338 | 7,196 | |||||
Total | $ | 223,407 | $ | 14,372 |
Pension Benefits | Other Benefits | ||||||
(In thousands) | |||||||
Components of accumulated other comprehensive loss: | |||||||
Net actuarial loss (gain) | $ | 48,466 | $ | (3,047 | ) | ||
Net prior service cost | 2,734 | — | |||||
$ | 51,200 | $ | (3,047 | ) |
Pension Benefits | Other Benefits | ||||||
(In thousands) | |||||||
Changes in accumulated other comprehensive loss: | |||||||
Net actuarial loss (gain), beginning of year | $ | 44,359 | $ | (1,545 | ) | ||
Amortization of actuarial gain (loss) | (2,810 | ) | 12 | ||||
Actuarial gain | (15,032 | ) | (1,681 | ) | |||
Asset loss | 24,755 | — | |||||
Settlement loss recognized | (1,342 | ) | — | ||||
Currency impact | (1,464 | ) | 167 | ||||
Net actuarial loss (gain), end of year | $ | 48,466 | $ | (3,047 | ) | ||
Prior service cost, beginning of year | $ | 11 | $ | — | |||
Amortization of prior service credit | 42 | — | |||||
Prior service cost occurring during the year | 2,822 | — | |||||
Currency impact | (141 | ) | — | ||||
Prior service cost, end of year | $ | 2,734 | $ | — |
Foreign Currency Translation Component | Pension and Other Postretirement Benefit Plans | Accumulated Other Comprehensive Income (Loss) | |||||||||
(In thousands) | |||||||||||
Balance at December 31, 2016 | $ | (4,661 | ) | $ | (34,406 | ) | $ | (39,067 | ) | ||
Other comprehensive gain (loss) loss attributable to Belden before reclassifications | (65,030 | ) | 4,504 | (60,526 | ) | ||||||
Amounts reclassified from accumulated other comprehensive loss | — | 1,567 | 1,567 | ||||||||
Net current period other comprehensive gain (loss) attributable to Belden | (65,030 | ) | 6,071 | (58,959 | ) | ||||||
Balance at December 31, 2017 | (69,691 | ) | (28,335 | ) | (98,026 | ) | |||||
Other comprehensive gain (loss) attributable to Belden before reclassifications | 27,809 | (7,813 | ) | 19,996 | |||||||
Amounts reclassified from accumulated other comprehensive income | — | 3,123 | 3,123 | ||||||||
Net current period other comprehensive gain (loss) attributable to Belden | 27,809 | (4,690 | ) | 23,119 | |||||||
Balance at December 31, 2018 | $ | (41,882 | ) | $ | (33,025 | ) | $ | (74,907 | ) |
Amount Reclassified from Accumulated Other Comprehensive Income | Affected Line Item in the Consolidated Statements of Operations and Comprehensive Income | |||||
(In thousands) | ||||||
Amortization of pension and other postretirement benefit plan items: | ||||||
Settlement loss | $ | 1,342 | (1 | ) | ||
Actuarial losses | 2,798 | (1 | ) | |||
Prior service credit | (42 | ) | (1 | ) | ||
Total before tax | 4,098 | |||||
Tax benefit | (975 | ) | ||||
Total net of tax | $ | 3,123 |
(1) | The amortization of these accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit costs (see Note 16). |
Years Ended December 31, | |||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands) | |||||||||||
Total share-based compensation cost | $ | 18,497 | $ | 14,647 | $ | 18,178 | |||||
Income tax benefit | 4,402 | 5,566 | 7,069 |
Years Ended December 31, | |||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands, except weighted average fair value and assumptions) | |||||||||||
Weighted-average fair value of SARs and options granted | $ | 25.19 | $ | 27.31 | $ | 18.79 | |||||
Total intrinsic value of SARs converted and options exercised | 2,263 | 7,156 | 9,678 | ||||||||
Tax benefit related to share-based compensation | 113 | 967 | 1,171 | ||||||||
Weighted-average fair value of restricted stock shares and units granted | 72.54 | 79.96 | 54.52 | ||||||||
Total fair value of restricted stock shares and units vested | 5,740 | 10,355 | 8,171 | ||||||||
Expected volatility | 33.16 | % | 36.89 | % | 37.47 | % | |||||
Expected term (in years) | 5.6 | 5.6 | 5.7 | ||||||||
Risk-free rate | 2.70 | % | 2.01 | % | 1.32 | % | |||||
Dividend yield | 0.27 | % | 0.27 | % | 0.38 | % |
SARs and Stock Options | Restricted Shares and Units | ||||||||||||||||||
Number | Weighted- Average Exercise Price | Weighted- Average Remaining Contractual Term | Aggregate Intrinsic Value | Number | Weighted- Average Grant-Date Fair Value | ||||||||||||||
(In thousands, except exercise prices, fair values, and contractual terms) | |||||||||||||||||||
Outstanding at January 1, 2018 | 1,132 | $ | 62.75 | 496 | $ | 78.03 | |||||||||||||
Granted | 265 | 72.34 | 338 | 72.54 | |||||||||||||||
Exercised or converted | (62 | ) | 36.70 | (71 | ) | 81.48 | |||||||||||||
Forfeited or expired | (46 | ) | 73.76 | (136 | ) | 91.97 | |||||||||||||
Outstanding at December 31, 2018 | 1,289 | $ | 65.58 | 6.6 | $ | — | 627 | $ | 71.66 | ||||||||||
Vested or expected to vest at December 31, 2018 | 1,237 | $ | 65.33 | 6.5 | $ | — | |||||||||||||
Exercisable or convertible at December 31, 2018 | 801 | 62.88 | 5.4 | — |
2019 | $ | 19,877 | |
2020 | 17,531 | ||
2021 | 14,776 | ||
2022 | 12,317 | ||
2023 | 7,654 | ||
Thereafter | 28,771 | ||
$ | 100,926 |
Years Ended December 31, | |||||||||||
2018 | 2017 | 2016 | |||||||||
(In thousands) | |||||||||||
Income tax refunds received | $ | 4,782 | $ | 5,031 | $ | 3,838 | |||||
Income taxes paid | (54,109 | ) | (35,893 | ) | (26,587 | ) | |||||
Interest paid | (48,519 | ) | (79,047 | ) | (87,076 | ) |
2018 | 1st | 2nd | 3rd | 4th | Year | ||||||||||||||
(In thousands, except days and per share amounts) | |||||||||||||||||||
Number of days in quarter | 91 | 91 | 91 | 92 | 365 | ||||||||||||||
Revenues | $ | 605,565 | $ | 668,639 | $ | 655,774 | $ | 655,390 | $ | 2,585,368 | |||||||||
Gross profit | 230,594 | 257,596 | 260,857 | 259,365 | 1,008,412 | ||||||||||||||
Operating income | 44,203 | 56,506 | 131,278 | 73,234 | 305,221 | ||||||||||||||
Net income | 2,570 | 28,792 | 85,858 | 43,491 | 160,711 | ||||||||||||||
Less: Net loss attributable to noncontrolling interest | (48 | ) | (77 | ) | (23 | ) | (35 | ) | (183 | ) | |||||||||
Net income attributable to Belden | 2,618 | 28,869 | 85,881 | 43,526 | 160,894 | ||||||||||||||
Less: Preferred stock dividends | 8,733 | 8,733 | 8,732 | 8,733 | 34,931 | ||||||||||||||
Net income (loss) attributable to Belden common stockholders | (6,115 | ) | 20,136 | 77,149 | 34,793 | 125,963 | |||||||||||||
Basic income (loss) per share attributable to Belden common stockholders: | $ | (0.15 | ) | $ | 0.49 | $ | 1.90 | $ | 0.87 | $ | 3.10 | ||||||||
Diluted income (loss) per share attributable to Belden stockholders: | $ | (0.15 | ) | $ | 0.49 | $ | 1.80 | $ | 0.87 | $ | 3.08 |
2017 | 1st | 2nd | 3rd | 4th | Year | ||||||||||||||
(In thousands, except days and per share amounts) | |||||||||||||||||||
Number of days in quarter | 92 | 91 | 91 | 91 | 365 | ||||||||||||||
Revenues | $ | 551,381 | $ | 610,633 | $ | 621,745 | $ | 604,884 | $ | 2,388,643 | |||||||||
Gross profit | 222,374 | 243,104 | 239,849 | 229,426 | 934,753 | ||||||||||||||
Operating income | 51,597 | 62,776 | 61,116 | 59,915 | 235,404 | ||||||||||||||
Net Income | 25,581 | 35,891 | 945 | 30,436 | 92,853 | ||||||||||||||
Less: Net loss attributable to noncontrolling interest | (106 | ) | (86 | ) | (82 | ) | (83 | ) | (357 | ) | |||||||||
Net income attributable to Belden | 25,687 | 35,977 | 1,027 | 30,519 | 93,210 | ||||||||||||||
Less: Preferred stock dividends | 8,733 | 8,733 | 8,732 | 8,733 | 34,931 | ||||||||||||||
Net income (loss) attributable to Belden common stockholders | 16,954 | 27,244 | (7,705 | ) | 21,786 | 58,279 | |||||||||||||
Basic income (loss) per share attributable to Belden common stockholders: | $ | 0.40 | $ | 0.64 | $ | (0.18 | ) | $ | 0.52 | $ | 1.38 | ||||||||
Diluted income (loss) per share attributable to Belden common stockholders: | $ | 0.40 | $ | 0.64 | $ | (0.18 | ) | $ | 0.51 | $ | 1.37 |
• | Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company; |
• | Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and |
• | Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements. |
(a) | Documents filed as part of this Report: |
1. | Financial Statements |
2. | Financial Statement Schedule |
Beginning Balance | Charged to Costs and Expenses | Divestitures/ Acquisitions | Charge Offs | Recoveries | Currency Movement | Ending Balance | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||
Accounts Receivable— | |||||||||||||||||||||||||||
Allowance for Doubtful Accounts: | |||||||||||||||||||||||||||
2018 | $ | 7,766 | $ | 1,273 | $ | 1,168 | $ | (1,389 | ) | $ | (293 | ) | $ | (294 | ) | $ | 8,231 | ||||||||||
2017 | 8,104 | 950 | 38 | (905 | ) | (995 | ) | 574 | 7,766 | ||||||||||||||||||
2016 | 8,281 | 2,517 | (1 | ) | (1,336 | ) | (1,046 | ) | (311 | ) | 8,104 | ||||||||||||||||
Inventories— | |||||||||||||||||||||||||||
Excess and Obsolete Allowances: | |||||||||||||||||||||||||||
2018 | $ | 25,269 | $ | 3,659 | $ | 6,204 | $ | (3,328 | ) | $ | (2,709 | ) | $ | (199 | ) | $ | 28,896 | ||||||||||
2017 | 24,561 | 2,348 | 2,628 | (3,219 | ) | (2,205 | ) | 1,156 | 25,269 | ||||||||||||||||||
2016 | 22,531 | 3,921 | (706 | ) | — | (1,142 | ) | (43 | ) | 24,561 | |||||||||||||||||
Deferred Income Tax Asset— | |||||||||||||||||||||||||||
Valuation Allowance: | |||||||||||||||||||||||||||
2018 | $ | 151,841 | $ | 20,274 | $ | 33,870 | $ | (93,432 | ) | $ | (17,930 | ) | $ | (3,751 | ) | $ | 90,872 | ||||||||||
2017 | 104,771 | 39,307 | — | (3,322 | ) | (1,712 | ) | 12,797 | 151,841 | ||||||||||||||||||
2016 | 117,071 | 10,782 | 616 | (8,074 | ) | (10,526 | ) | (5,098 | ) | 104,771 |
3. | Exhibits |
Exhibit Number | Description of Exhibit | The filings referenced for incorporation by reference are Company (Belden Inc.) filings unless noted to be those of Belden 1993 Inc. | ||
3.1 | February 29, 2008 Form 10-K, Exhibit 3.1 | |||
3.2 | July 26, 2016 Form 8-K, Exhibit 3.1 | |||
3.3 | May 31, 2016 Form 8-K, Exhibit 3.1 | |||
4.1 | July 26, 2016 Form 8-K, Exhibit 4.2 | |||
4.2 | October 11, 2016 Form 8-K, Exhibit 4.1 | |||
4.3 | June 26, 2017 Form 8-K, Exhibit 4.22 | |||
4.4 | July 10, 2017 Form 8-K, Exhibit 4.1 | |||
4.5 | September 22, 2017 Form 8-K, Exhibit 4.1 | |||
4.6 | March 16, 2018 Form 8-K, Exhibit 4.1 | |||
10.1 | Trademark License Agreement | November 15, 1993 Form 10-Q of Belden 1993 Inc., Exhibit 10.2 | ||
10.2* | April 6, 2009 Proxy Statement, Appendix I | |||
10.3* | April 6,2016 Proxy Statement, Appendix II | |||
10.4* | August 3, 2016 Form 10-Q, Exhibit 10.1 | |||
10.5* | August 3, 2016 Form 10-Q, Exhibit 10.2 | |||
10.6* | May 6, 2014 Form 10-Q, Exhibit 10.3 | |||
10.7* | February 29, 2012 Form 10-K, Exhibit 10.16 | |||
10.8* | December 21, 2004 Form 8-K, Exhibit 10.1 | |||
10.9* | March 22, 2002 Form 10-K of Belden 1993 Inc., Exhibit 10.14 | |||
10.10* | March 22, 2002 Form 10-K of Belden 1993 Inc., Exhibit 10.15 | |||
Exhibit Number | Description of Exhibit | The filings referenced for incorporation by reference are Company (Belden Inc.) filings unless noted to be those of Belden 1993 Inc. | ||
10.11* | March 14, 2003 Form 10-K of Belden 1993 Inc., Exhibit 10.21 | |||
10.12* | November 15, 2004 Form 10-Q, Exhibit 10.50 | |||
10.13* | March 22, 2002 Form 10-K of Belden 1993 Inc., Exhibit 10.16 | |||
10.14* | March 22, 2002 Form 10-K of Belden 1993 Inc., Exhibit 10.17 | |||
10.15* | 2003 Form 10-K of Belden 1993 Inc., Exhibit 10.24 | |||
10.16* | November 15, 2004 Form 10-Q, Exhibit 10.51 | |||
10.17* | November 15, 2004 Form 10-Q, Exhibit 10.52 | |||
10.18* | November 15, 2004 Form 10-Q, Exhibit 10.53 | |||
10.19* | November 15, 2004 Form 10-Q, Exhibit 10.54 | |||
10.20* | November 15, 2004 Form 10-Q, Exhibit 10.55 | |||
10.21* | April 7, 2008 Form 8-K, Exhibit 10.1 | |||
10.22* | December 17, 2008 Form 8-K, Exhibit 10.1 | |||
10.23* | January 5, 2012 Form 8-K, Exhibit 10.1 | |||
10.24* | August 8, 2013 Form 10-Q, Exhibit 10.1 | |||
10.25* | August 8, 2013 Form 10-Q, Exhibit 10.2 | |||
10.26* | November 6, 2013 Form 10-Q, Exhibit 10.1 | |||
10.27* | August 5, 2014 Form 10-Q, Exhibit 10.1 | |||
10.28* | August 5, 2014 Form 10-Q, Exhibit 10.2 | |||
10.29* | May 5, 2015 Form 10-Q, Exhibit 10.1 | |||
10.30* | August 4, 2015 Form 10-Q Exhibit 10.1 | |||
10.31* | February 13, 2018 Form 10-K Exhibit 10.31 | |||
10.32* | November 5, 2018 Form 10-Q Exhibit 10.1 | |||
Exhibit Number | Description of Exhibit | The filings referenced for incorporation by reference are Company (Belden Inc.) filings unless noted to be those of Belden 1993 Inc. | ||
10.33* | March 1, 2007 Form 10-K, Exhibit 10.39 | |||
10.34 | May 22, 2017, Form 8-K, Exhibit 10.1 | |||
10.35 | June 29, 2017 Form 8-K, Exhibit 10.1 | |||
10.36 | September 14, 2017 Form 8-K, Exhibit 10.1 | |||
10.37 | March 8, 2018 Form 8-K, Exhibit 10.1 | |||
14.1 | August 26, 2016 Form 8-K, Exhibit 14.1 | |||
21.1 | Filed herewith | |||
23.1 | Filed herewith | |||
24.1 | Filed herewith | |||
31.1 | Filed herewith | |||
31.2 | Filed herewith | |||
32.1 | Filed herewith | |||
32.2 | Filed herewith |
* | Management contract or compensatory plan |
BELDEN INC. | |||
By | /s/ JOHN S. STROUP | ||
John S. Stroup | |||
President, Chief Executive Officer, and Chairman | |||
Date: February 20, 2019 |
/s/ JOHN S. STROUP | President, Chief Executive Officer, and Chairman | February 20, 2019 | ||
John S. Stroup | ||||
/s/ HENK DERKSEN | Senior Vice President, Finance, and Chief Financial Officer | February 20, 2019 | ||
Henk Derksen | ||||
/s/ DOUGLAS R. ZINK | Vice President and Chief Accounting Officer | February 20, 2019 | ||
Douglas R. Zink | ||||
/s/ DAVID ALDRICH* | Lead Independent Director | February 20, 2019 | ||
David Aldrich | ||||
/s/ LANCE C. BALK* | Director | February 20, 2019 | ||
Lance C. Balk | ||||
/s/ STEVEN BERGLUND* | Director | February 20, 2019 | ||
Steven Berglund | ||||
/s/ DIANE D. BRINK* | Director | February 20, 2019 | ||
Diane D. Brink | ||||
/s/ JUDY L. BROWN* | Director | February 20, 2019 | ||
Judy L. Brown | ||||
/s/ BRYAN C. CRESSEY* | Director | February 20, 2019 | ||
Bryan C. Cressey | ||||
/s/ JONATHAN KLEIN* | Director | February 20, 2019 | ||
Jonathan Klein | ||||
/s/ GEORGE MINNICH* | Director | February 20, 2019 | ||
George Minnich | ||||
/s/ JOHN MONTER* | Director | February 20, 2019 | ||
John Monter | ||||
/s/ JOHN S. STROUP | ||||
*By John S. Stroup, Attorney-in-fact |
Entity | Country/State of Incorporation | Percentage Owned Directly or Indirectly by Belden Inc. | ||
Belden 1993 LLC | (Organized in Delaware) | 100% | ||
Belden AB | (Incorporated in Sweden) | 100% | ||
Belden Asia (Hong Kong) Limited | (Incorporated in Hong Kong) | 100% | ||
Belden Asia (Thailand) Company Limited | (Incorporated in Thailand) | 100% | ||
Belden Australia Pty Ltd. | (Incorporated in Australia) | 100% | ||
Belden Canada Finance 1 ULC | (Organized in Canada) | 100% | ||
Belden Canada Finance 2 ULC | (Organized in Canada) | 100% | ||
Belden Canada Finance 2013 LP | (Canadian Limited Partnership) | 100% | ||
Belden Canada Inc. | (Incorporated in Canada) | 100% | ||
Belden CDT European Shared Services B.V. | (Incorporated in the Netherlands) | 100% | ||
Belden CDT International Inc. | (Incorporated in Delaware) | 100% | ||
Belden Cekan A/S | (Incorporated in Denmark) | 100% | ||
Belden Commercial Services B.V. | (Incorporated in the Netherlands) | 100% | ||
Belden de Sonora S.A. de C.V. | (Incorporated in Mexico) | 100% | ||
Belden Deutschland GmbH | (Incorporated in Germany) | 100% | ||
Belden Deutschland Holding GmbH | (Incorporated in Germany) | 100% | ||
Belden-Duna Kabel Kft | (Incorporated in Hungary) | 100% | ||
Belden Electronics Argentina S.A. | (Incorporated in Argentina) | 100% | ||
Belden Electronics GmbH | (Incorporated in Germany) | 100% | ||
Belden Electronics, S.A. de C.V. | (Incorporated in Mexico) | 100% | ||
Belden Europe B.V. | (Incorporated in the Netherlands) | 100% | ||
Belden Finance 2013 LP | (Delaware Limited Partnership) | 100% | ||
Belden Finance 2016 LLC | (Organized in Delaware) | 100% | ||
Belden France SAS | (Incorporated in France) | 100% | ||
Belden Global LP | (Delaware Limited Partnership) | 100% | ||
Belden Global Holdings, B.V. | (Incorporated in the Netherlands) | 100% | ||
Belden Grass Valley Asia Limited | (Incorporated in Hong Kong) | 100% | ||
Belden Grass Valley Industria E Comercio E Servicos Ltda. | (Incorporated in Brazil) | 100% | ||
Belden Hirschmann Industries (Suzhou) Limited | (Incorporated in China) | 100% | ||
Belden Hirschmann Networking System Trading (Shanghai) Co. Ltd. | (Incorporated in China) | 100% | ||
Belden Holdings, Inc. | (Organized in Delaware) | 100% | ||
Belden Iberia SL | (Incorporated in Spain) | 100% | ||
Belden India Private Limited | (Incorporated in India) | 100% | ||
Belden International Holdings B.V. | (Incorporated in the Netherlands) | 100% | ||
Belden Italia SRL | (Incorporated in Italy) | 100% | ||
Belden LRC Mexico S. de R.L. de C.V. | (Incorporated in Mexico) | 100% | ||
Belden Lux Holdings S.a.r.l. | (Organized in Luxembourg) | 100% | ||
Belden Luxembourg S.a.r.l. | (Organized in Luxembourg) | 100% | ||
Belden Mexico Enterprises Limited | (Organized in United Kingdom) | 100% |
Entity | Country/State of Incorporation | Percentage Owned Directly or Indirectly by Belden Inc. | ||
Belden Netherlands B.V. | (Incorporated in the Netherlands) | 100% | ||
Belden Signal Solutions B.V. | (Incorporated in the Netherlands) | 100% | ||
Belden Singapore Private Limited | (Incorporated in Singapore) | 100% | ||
Belden Solutions B.V. | (Incorporated in the Netherlands) | 100% | ||
Belden Technologies Co., Limited | (Incorporated in Japan) | 100% | ||
Belden Technologies, LLC | (Organized in Delaware) | 100% | ||
Belden Technologies Ireland DAC | (Organized in Ireland) | 100% | ||
Belden Technologies Peru S.r.l. | (Incorporated in Peru) | 100% | ||
Belden UK Holdings Limited | (Incorporated in the United Kingdom) | 100% | ||
Belden UK Limited | (Incorporated in the United Kingdom) | 100% | ||
Belden Wire & Cable B.V. | (Incorporated in the Netherlands) | 100% | ||
Belden Wire & Cable Company LLC | (Organized in Delaware) | 100% | ||
BiBiXi Communications System (Suzhou) Co., Ltd. | (Incorporated in China) | 100% | ||
CDT International Holdings LLC | (Organized in Delaware) | 100% | ||
Coast Wire & Plastic Tech, LLC | (Organized in Delaware) | 100% | ||
GarrettCom Europe Ltd. | (Incorporated in the United Kingdom) | 100% | ||
GarrettCom, Inc. | (Incorporated in California) | 100% | ||
GarrettCom India Private Ltd. | (Incorporated in India) | 49% | ||
GlobalBlue Networks Inc. | (Incorporated in Canada) | 100% | ||
Grass Valley Australia Pty Ltd | (Incorporated in Australia) | 100% | ||
Grass Valley Belgium NV | (Incorporated in Belgium) | 100% | ||
Grass Valley Broadcast Solutions Limited | (Incorporated in the United Kingdom) | 100% | ||
Grass Valley Canada | (Canadian Partnership) | 100% | ||
Grass Valley Canada Partner ULC | (Canadian Partnership) | 100% | ||
Grass Valley China Co. Ltd. | (Incorporated in China) | 100% | ||
Grass Valley France SAS | (Incorporated in France) | 100% | ||
Grass Valley Hong Kong Ltd. | (Incorporated in Hong Kong) | 100% | ||
Grass Valley India Private Limited | (Incorporated in India) | 100% | ||
Grass Valley Italia S.R.L. | (Incorporated in Italy) | 100% | ||
Grass Valley K.K. | (Incorporated in Japan) | 100% | ||
Grass Valley Limited | (Incorporated in the United Kingdom) | 100% | ||
Grass Valley Malaysia SDN BHD | (Incorporated in Malaysia) | 100% | ||
Grass Valley Nederland B.V. | (Incorporated in the Netherlands) | 100% | ||
Grass Valley Singapore Pte. Ltd. | (Incorporated in Singapore) | 100% | ||
Grass Valley Spain SA | (Incorporated in Spain) | 100% | ||
Grass Valley UK Ltd | (Incorporated in the United Kingdom) | 100% | ||
Grass Valley USA, LLC | (Organized in Delaware) | 100% | ||
GVBB Holdings Sarl | (Incorporated in Luxembourg) | 100% | ||
GVBB Netherlands B.V. | (Incorporated in the Netherlands) | 100% | ||
Hirschmann Automation & Control GmbH | (Incorporated in Germany) | 100% | ||
Hirschmann Automation & Control Kabushiki Kaisha | (Incorporated in Japan) | 100% | ||
Hirschmann Electronics GmbH | (Incorporated in Germany) | 100% |
Entity | Country/State of Incorporation | Percentage Owned Directly or Indirectly by Belden Inc. | ||
ITC Industria Tecnica CAVI S.r.l. | (Incorporated in Italy) | 100% | ||
Kajola-Kristada Limited | (Incorporated in St. Kitts and Nevis) | 100% | ||
Limited Liability Company Grass Valley RUS | (Incorporated in Russia) | 100% | ||
Lukram SRO | (Incorporated in Czech Republic) | 100% | ||
Mantrics S.r.l. | (Incorporated in Italy) | 100% | ||
Micro Consultants Ltd. | (Incorporated in the United Kingdom) | 100% | ||
Miniflex, Inc. | (Incorporated in Delaware) | 100% | ||
Miranda Technologies Asia Limited | (Incorporated in Hong Kong) | 100% | ||
Miranda Technologies France SAS | (Incorporated in France) | 100% | ||
Miranda Technologies Malaysia SDN BHD | (Incorporated in Malaysia) | 100% | ||
Miranda Technologies Singapore Pte. Ltd. | (Incorporated in Singapore) | 100% | ||
NAO Snell | (Organized in Russia) | 100% | ||
nCircle Canada Corp | (Incorporated in Canada) | 100% | ||
Net-Tech Technology, Inc. | (Incorporated in Nebraska) | 100% | ||
Noslo Limited | (Incorporated in the United Kingdom) | 100% | ||
PPC Broadband Fiber Ltd. | (Incorporated in the United Kingdom) | 100% | ||
PPC Broadband, Inc. | (Incorporated in Delaware) | 100% | ||
PPC Broadband India Private Limited | (Incorporated in India) | 100% | ||
PPC Broadband Ltd. | (Incorporated in the United Kingdom) | 100% | ||
Pro-Bel Ltd. | (Incorporated in the United Kingdom) | 100% | ||
Pro-Bel Group Ltd. | (Incorporated in the United Kingdom) | 100% | ||
Pro-Bel Holdings Ltd. | (Incorporated in the United Kingdom) | 100% | ||
ProLinx Comunicacao Industria LTDA | (Incorporated in Brazil) | 100% | ||
ProSoft Technology (Asia Pacific) Sendirian Berhad | (Incorporated in Malaysia) | 100% | ||
ProSoft Technology SAS | (Incorporated in France) | 100% | ||
ProSoft Technology, Inc. | (Incorporated in California) | 100% | ||
PSP Digital Ltd. | (Incorporated in the United Kingdom) | 100% | ||
Quantel Espana SAU | (Incorporated in Spain) | 100% | ||
Quantel Europe Ltd. | (Incorporated in the United Kingdom) | 100% | ||
Quantel GmbH | (Incorporated in Germany) | 100% | ||
Quantel Group Ltd. | (Incorporated in the United Kingdom) | 100% | ||
Quantel Holdings (2010) Ltd. | (Incorporated in the United Kingdom) | 100% | ||
Quantel Ltd. | (Incorporated in the United Kingdom) | 100% | ||
Quantel Ltd. | (Incorporated in Hong Kong) | 100% | ||
Quantel Inc. | (Incorporated in Delaware) | 100% | ||
Shanghai Hite-Belden Network Technology Co., Ltd. | (Incorporated in China) | 51% | ||
Softel Limited | (Incorporated in the United Kingdom) | 100% | ||
Snell & Wilcox SE Asia Sdn Bdh | (Incorporated in Malaysia) | 100% | ||
Snell Advanced Media India Private Limited | (Incorporated in India) | 100% | ||
Snell Advanced Media KK | (Incorporated in Japan) | 100% | ||
Snell Advanced Media Pte. Ltd. | (Incorporated in Singapore) | 100% | ||
Snell Advanced Media Pty Ltd | (Incorporated in Australia) | 100% |
Entity | Country/State of Incorporation | Percentage Owned Directly or Indirectly by Belden Inc. | ||
Snell Advanced Media Sarl | (Incorporated in France) | 100% | ||
Snell Asia Pacific Ltd. | (Incorporated in Hong Kong) | 100% | ||
Snell Corporation Ltd. | (Incorporated in the United Kingdom) | 100% | ||
Snell GmbH | (Incorporated in Germany) | 100% | ||
Snell, Inc. | (Incorporated in Delaware) | 100% | ||
St. Kitts Technology Limited | (Incorporated in St. Kitts and Nevis) | 100% | ||
Thinklogical, LLC | (Organized in Delaware) | 100% | ||
Thinklogical Holdings, LLC | (Organized in Delaware) | 100% | ||
Thinklogical International, LLC | (Incorporated in Delaware) | 100% | ||
Thinklogical Real Estate, LLC | (Organized in Delaware) | 100% | ||
Tripwire Australia Pty Ltd | (Incorporated in Australia) | 100% | ||
Tripwire, Inc. | (Incorporated in Delaware) | 100% | ||
Tripwire International, Inc. | (Incorporated in Delaware) | 100% | ||
Tripwire Japan KK | (Incorporated in Japan) | 100% | ||
VIA Holdings I, Inc. | (Incorporated in Delaware) | 100% | ||
VIA Holdings II, Inc. | (Incorporated in Delaware) | 100% |
(1) | Registration Statements (Forms S-8 No. 333-73790, No. 333-138177, and No. 333-160292) pertaining to the Cable Design Technologies Corporation 2001 Long-Term Performance Incentive Plan of Belden Inc. (formerly Cable Design Technologies Corporation), |
(2) | Registration Statements (Forms S-8 No. 333-175859 and No. 333-216752) of Belden Inc. pertaining to the 2011 Long-Term Performance Incentive Plan, and |
(3) | Registration Statement (Form S-3 No. 333-211717) of Belden Inc.; |
1. | I have reviewed this annual report on Form 10-K of Belden Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of circumstances under which the statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have: |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
/s/ John S. Stroup |
John S. Stroup |
President, Chief Executive Officer, and Chairman |
1. | I have reviewed this annual report on Form 10-K of Belden Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of circumstances under which the statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have: |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
/s/ Henk Derksen |
Henk Derksen |
Senior Vice President, Finance, and Chief Financial Officer |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ John S. Stroup |
John S. Stroup |
President, Chief Executive Officer, and Chairman |
February 20, 2019 |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Henk Derksen |
Henk Derksen |
Senior Vice President, Finance, and Chief Financial Officer |
February 20, 2019 |
Document and Entity Information - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Feb. 15, 2019 |
Jul. 01, 2018 |
|
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | BDC | ||
Entity Registrant Name | BELDEN INC. | ||
Entity Central Index Key | 0000913142 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 39,399,412 | ||
Entity Public Float | $ 1,874,027,335 |
Consolidated Balance Sheets (Parenthetical) - $ / shares |
Dec. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred stock, shares outstanding (in shares) | 52,000 | 52,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 50,335,000 | 50,335,000 |
Common stock, shares outstanding (in shares) | 39,396,000 | 42,019,000 |
Treasury stock, shares (in shares) | 10,939,000 | 8,316,000 |
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 160,711 | $ 92,853 | $ 127,646 |
Foreign currency translation, net of tax of $1.7 million, $1.3 million, and $1.2 million, respectively | 27,802 | (65,046) | 18,687 |
Adjustments to pension and postretirement liability, net of tax of $1.0 million, $2.2 million, and $1.9 million, respectively | (4,690) | 6,071 | 1,170 |
Other comprehensive income (loss), net of tax | 23,112 | (58,975) | 19,857 |
Comprehensive income | 183,823 | 33,878 | 147,503 |
Less: Comprehensive loss attributable to noncontrolling interest | (190) | (373) | (420) |
Comprehensive income attributable to Belden | $ 184,013 | $ 34,251 | $ 147,923 |
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Statement of Comprehensive Income [Abstract] | |||
Foreign currency translation, tax expense (benefit) | $ 1.7 | $ 1.3 | $ 1.2 |
Adjustments to pension and postretirement liability, tax | $ 0.9 | $ 2.2 | $ 1.9 |
Consolidated Stockholders' Equity Statements (Parenthetical) - $ / shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Statement of Stockholders' Equity [Abstract] | |||
Dividends declared per share | $ 0.2 | $ 0.20 | $ 0.20 |
Basis of Presentation |
12 Months Ended |
---|---|
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Business Description Belden Inc. (the Company, us, we, or our) is a signal transmission solutions company built around two global business platforms – Enterprise Solutions and Industrial Solutions. Our comprehensive portfolio of signal transmission solutions provides industry leading secure and reliable transmission of data, sound, and video for mission critical applications. We sell our products to distributors, end-users, installers, and directly to original equipment manufacturers (OEMs). Consolidation The accompanying Consolidated Financial Statements include Belden Inc. and all of its subsidiaries, including variable interest entities for which we are the primary beneficiary. We eliminate all significant affiliate accounts and transactions in consolidation. Foreign Currency For international operations with functional currencies other than the United States (U.S.) dollar, we translate assets and liabilities at current exchange rates; we translate income and expenses using average exchange rates. We report the resulting translation adjustments, as well as gains and losses from certain affiliate transactions, in accumulated other comprehensive income (loss), a separate component of stockholders’ equity. We include exchange gains and losses on transactions in operating income. We determine the functional currency of our foreign subsidiaries based upon the currency of the primary economic environment in which each subsidiary operates. Typically, that is determined by the currency in which the subsidiary primarily generates and expends cash. We have concluded that the local currency is the functional currency for all of our material subsidiaries. Reporting Periods Our fiscal year and fiscal fourth quarter both end on December 31. Our fiscal first quarter ends on the Sunday falling closest to 91 days after December 31. Our fiscal second and third quarters each have 91 days. Use of Estimates in the Preparation of the Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, and operating results and the disclosure of contingencies. Actual results could differ from those estimates. We make significant estimates with respect to the collectability and valuation of receivables, the valuation of inventory, the realization of deferred tax assets, the valuation of goodwill and indefinite-lived intangible assets, the valuation of contingent liabilities, the calculation of share-based compensation, the calculation of pension and other postretirement benefits expense, and the valuation of acquired businesses. Reclassifications We have made certain reclassifications to the 2017 and 2016 Condensed Consolidated Financial Statements, including those related to the adoption of Accounting Standards Update No. 2017-07, Compensation - Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (ASU 2017-07) and our segment change, with no impact to reported net income in order to conform to the 2018 presentation. See Note 5. |
Summary of Significant Accounting Policies |
12 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2018 | |||||||||||||
Accounting Policies [Abstract] | |||||||||||||
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Fair Value Measurement Accounting guidance for fair value measurements specifies a hierarchy of valuation techniques based upon whether the inputs to those valuation techniques reflect assumptions other market participants would use based upon market data obtained from independent sources or reflect our own assumptions of market participant valuation. The hierarchy is broken down into three levels based on the reliability of the inputs as follows:
During 2018, 2017, and 2016 we utilized Level 1 inputs to determine the fair value of cash equivalents, and Level 3 inputs to determine the fair value of net assets acquired in business combinations (see Note 4) and for our annual impairment testing (see Note 10). We did not have any transfers between Level 1 and Level 2 fair value measurements during 2018. Cash and Cash Equivalents We classify cash on hand and deposits in banks, including commercial paper, money market accounts, and other investments with an original maturity of three months or less, that we hold from time to time, as cash and cash equivalents. We periodically have cash equivalents consisting of short-term money market funds and other investments. As of December 31, 2018 and 2017, we did not have any such cash equivalents on hand. The primary objective of our investment activities is to preserve our capital for the purpose of funding operations. We do not enter into investments for trading or speculative purposes. Accounts Receivable We classify amounts owed to us and due within twelve months, arising from the sale of goods or services and from other business activities, as current receivables. We classify receivables due after twelve months as other long-lived assets. At the time of sale, we establish an estimated reserve for trade, promotion, and other special price reductions such as contract pricing, discounts to meet competitor pricing, and on-time payment discounts. We also adjust receivable balances for, among other things, correction of billing errors, incorrect shipments, and settlement of customer disputes. Customers are allowed to return inventory if and when certain conditions regarding the physical state of the inventory and our approval of the return are met. Certain distribution customers are allowed to return inventory at original cost, in an amount not to exceed three percent of the prior year’s purchases, in exchange for an order of equal or greater value. Until we can process these reductions, corrections, and returns (together, the Changes) through individual customer records, we estimate the amount of outstanding Changes and recognize them by reducing revenues and accounts receivable. We also adjust inventory and cost of sales for the estimated level of returns. We base these estimates on historical and anticipated sales demand, trends in product pricing, and historical and anticipated Changes patterns. We make revisions to these estimates in the period in which the facts that give rise to each revision become known. Future market conditions might require us to take actions to further reduce prices and increase customer return authorizations. Unprocessed Changes recognized against our gross accounts receivable balance at December 31, 2018 and 2017 totaled $25.7 million and $35.7 million, respectively. We evaluate the collectability of accounts receivable based on the specific identification method. A considerable amount of judgment is required in assessing the realizability of accounts receivable, including the current creditworthiness of each customer and related aging of the past due balances. We perform ongoing credit evaluations of our customers’ financial condition. Through these evaluations, we may become aware of a situation where a customer may not be able to meet its financial obligations due to deterioration of its financial viability, credit ratings, or bankruptcy. We record a specific reserve for bad debts against amounts due to reduce the receivable to its estimated collectible balance. We recognized bad debt expense, net of recoveries, of $1.0 million, $0.0 million, and $1.5 million in 2018, 2017, and 2016, respectively. The allowance for doubtful accounts at December 31, 2018 and 2017 totaled $8.2 million and $7.8 million, respectively. Inventories and Related Reserves Inventories are stated at the lower of cost or net realizable value. We determine the cost of all raw materials, work-in-process, and finished goods inventories by the first in, first out method. Cost components of inventories include direct labor, applicable production overhead, and amounts paid to suppliers of materials and products as well as freight costs and, when applicable, duty costs to import the materials and products. We evaluate the realizability of our inventory on a product-by-product basis in light of historical and anticipated sales demand, technological changes, product life cycle, component cost trends, product pricing, and inventory condition. In circumstances where inventory levels are in excess of anticipated market demand, where inventory is deemed technologically obsolete or not saleable due to condition, or where inventory cost exceeds net realizable value, we record a charge to cost of sales and reduce the inventory to its net realizable value. The allowances for excess and obsolete inventories at December 31, 2018 and 2017 totaled $28.9 million and $25.3 million, respectively. Property, Plant and Equipment We record property, plant and equipment at cost. We calculate depreciation on a straight-line basis over the estimated useful lives of the related assets ranging from 10 to 40 years for buildings, 5 to 12 years for machinery and equipment, and 5 to 10 years for computer equipment and software. Construction in process reflects amounts incurred for the configuration and build-out of property, plant and equipment and for property, plant and equipment not yet placed into service. We charge maintenance and repairs—both planned major activities and less-costly, ongoing activities—to expense as incurred. We capitalize interest costs associated with the construction of capital assets and amortize the costs over the assets’ useful lives. Depreciation expense is included in costs of sales; selling, general and administrative expenses; and research and development expenses in the Consolidated Statements of Operations based on the specific categorization and use of the underlying assets being depreciated. We review property, plant and equipment to determine whether an event or change in circumstances indicates the carrying values of the assets may not be recoverable. We base our evaluation on the nature of the assets, the future economic benefit of the assets, and any historical or future profitability measurements, as well as other external market conditions or factors that may be present. If such impairment indicators are present or other factors exist that indicate that the carrying amount of an asset may not be recoverable, we determine whether impairment has occurred through the use of an undiscounted cash flow analysis. If impairment has occurred, we recognize a loss for the difference between the carrying amount and the fair value of the asset. For purposes of impairment testing of long-lived assets, we have identified asset groups at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Generally, our asset groups are based on an individual plant or operating facility level. In some circumstances, however, a combination of plants or operating facilities may be considered the asset group due to interdependence of operational activities and cash flows. Goodwill and Intangible Assets Our intangible assets consist of (a) definite-lived assets subject to amortization such as developed technology, customer relationships, certain in-service research and development, certain trademarks, backlog, and capitalized software intangible assets, and (b) indefinite-lived assets not subject to amortization such as goodwill, certain trademarks, and certain in-process research and development intangible assets. We record amortization of the definite-lived intangible assets over the estimated useful lives of the related assets, which generally range from one year or less for backlog to more than 25 years for certain of our customer relationships. We determine the amortization method for our definite-lived intangible assets based on the pattern in which the economic benefits of the intangible asset are consumed. In the event we cannot reliably determine that pattern, we utilize a straight-line amortization method. We test our goodwill and other indefinite-lived intangible assets not subject to amortization for impairment on an annual basis as of our fiscal November month-end or when indicators of impairment exist. We base our estimates on assumptions we believe to be reasonable, but which are not predictable with precision and therefore are inherently uncertain. Actual future results could differ from these estimates. The accounting guidance related to goodwill impairment testing allows for the performance of an optional qualitative assessment of whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. Such an evaluation is made based on the weight of all available evidence and the significance of all identified events and circumstances that may influence the fair value of a reporting unit. If it is more likely than not that the fair value is less than the carrying value, then a quantitative assessment is required for the reporting unit, as described in the paragraph below. In 2018, we performed a qualitative assessment for seven of our reporting units, which collectively represented approximately $383.4 million of our consolidated goodwill balance. For those reporting units for which we performed a qualitative assessment, we determined that it was more likely than not that the fair value was greater than the carrying value, and therefore, we did not perform the calculation of fair value for these reporting units as described in the paragraph below. For our annual impairment test in 2018, we performed a quantitative assessment for four of our reporting units, which collectively represented approximately $1,174.3 million of our consolidated goodwill balance. Under a quantitative assessment for goodwill impairment, we determine the fair value using the income approach (using Level 3 inputs) as reconciled to our aggregate market capitalization. Under the income approach, we calculate the fair value of a reporting unit based on the present value of estimated future cash flows. If the fair value of the reporting unit exceeds the carrying value of the net assets including goodwill assigned to that unit, goodwill is not impaired. If the carrying value of the reporting unit’s net assets including goodwill exceeds the fair value of the reporting unit, then we record an impairment charge based on that difference. In addition to the income approach, we calculate the fair value of our reporting units under a market approach. The market approach measures the fair value of a reporting unit through analysis of financial multiples of comparable businesses. Consideration is given to the financial conditions and operating performance of the reporting unit being valued relative to those publicly-traded companies operating in the same or similar lines of business. The fair values of the four reporting units tested under a quantitative approach were in excess of the carrying values as of the impairment testing date. We did not recognize any goodwill impairment in 2018, 2017, or 2016. See Note 10 for further discussion. We also evaluate indefinite lived intangible assets for impairment annually or at other times if events have occurred or circumstances exist that indicate the carrying values of those assets may no longer be recoverable. We compare the fair value of the asset with its carrying amount. If the carrying amount of the asset exceeds its fair value, we recognize an impairment loss in an amount equal to that excess. We did not recognize impairment charges for our indefinite lived intangible assets in 2018, 2017, or 2016. See Note 10 for further discussion. We review intangible assets subject to amortization whenever an event or change in circumstances indicates the carrying values of the assets may not be recoverable. We test intangible assets subject to amortization for impairment and estimate their fair values using the same assumptions and techniques we employ on property, plant and equipment. We did not recognize any impairment charges for amortizable intangible assets in 2018, 2017, or 2016. Disposals During 2018, we sold a previously closed operating facility for net proceeds of $1.5 million and recognized a $0.6 million gain on the sale. During the fourth quarter of 2016, we committed to a plan to sell our MCS business and 50% ownership interest in Xuzhou Hirschmann Electronics Co. Ltd (the Hirschmann JV) and determined that we met all of the criteria to classify the assets and liabilities of these businesses as held for sale. The MCS business was part of the Industrial Solutions segment and the Hirschmann JV was an equity method investment that was not included in an operating segment. The MCS business operated in Germany and the United States, and the Hirschmann JV was an equity method investment located in China. During 2016, we reached an agreement in principle to sell this disposal group for a total sales price of $39 million plus a working capital adjustment. As the carrying value of the disposal group exceeded the fair value less costs to sell, which we determined based on the expected sales price, by $23.9 million, we recognized an impairment charge equal to this amount in 2016. In 2017, we sold the MCS business and Hirschmann JV for a total purchase price of $40.2 million and recognized a loss on sale of the assets of $1.0 million, which was included in selling, general and administrative expenses. This loss included $2.8 million of accumulated other comprehensive losses that were recognized as a result of the sale. We collected the $40.2 million proceeds from the sale during 2018. Pension and Other Postretirement Benefits Our pension and other postretirement benefit costs and obligations are dependent on the various actuarial assumptions used in calculating such amounts. These assumptions relate to discount rates, salary growth, long-term return on plan assets, health care cost trend rates, mortality tables, and other factors. We base the discount rate assumptions on current investment yields on high-quality corporate long-term bonds. The salary growth assumptions reflect our long-term actual experience and future or near-term outlook. We determine the long-term return on plan assets based on historical portfolio results and management’s expectation of the future economic environment. Our health care cost trend assumptions are developed based on historical cost data, the near-term outlook, and an assessment of likely long-term trends. Actual results that differ from our assumptions are accumulated and, if in excess of the lesser of 10% of the projected benefit obligation or the fair market value of plan assets, are amortized over the estimated future working life of the plan participants. Accrued Sales Rebates We grant incentive rebates to participating customers as part of our sales programs. The rebates are determined based on certain targeted sales volumes. Rebates are paid quarterly or annually in either cash or receivables credits. Until we can process these rebates through individual customer records, we estimate the amount of outstanding rebates and recognize them as accrued liabilities and reductions in our gross revenues. We base our estimates on both historical and anticipated sales demand and rebate program participation. We charge revisions to these estimates back to accrued liabilities and revenues in the period in which the facts that give rise to each revision become known. Future market conditions and product transitions might require us to take actions to increase sales rebates offered, possibly resulting in an incremental increase in accrued liabilities and an incremental reduction in revenues at the time the rebate is offered. Accrued sales rebates at December 31, 2018 and 2017 totaled $41.3 million and $38.0 million, respectively. Contingent Liabilities We have established liabilities for environmental and legal contingencies that are probable of occurrence and reasonably estimable, the amounts of which are currently not material. A significant amount of judgment and use of estimates is required to quantify our ultimate exposure in these matters. We review the valuation of these liabilities on a quarterly basis, and we adjust the balances to account for changes in circumstances for ongoing and emerging issues. We accrue environmental remediation costs based on estimates of known environmental remediation exposures developed in consultation with our environmental consultants and legal counsel, the amounts of which are not currently material. We expense environmental compliance costs, which include maintenance and operating costs with respect to ongoing monitoring programs, as incurred. We evaluate the range of potential costs to remediate environmental sites. The ultimate cost of site clean-up is difficult to predict given the uncertainties of our involvement in certain sites, uncertainties regarding the extent of the required clean-up, the availability of alternative clean-up methods, variations in the interpretation of applicable laws and regulations, the possibility of insurance recoveries with respect to certain sites, and other factors. We are, from time to time, subject to routine litigation incidental to our business. These lawsuits primarily involve claims for damages arising out of the use of our products, allegations of patent or trademark infringement, and litigation and administrative proceedings involving employment matters and commercial disputes. Assessments regarding the ultimate cost of lawsuits require judgments concerning matters such as the anticipated outcome of negotiations, the number and cost of pending and future claims, and the impact of evidentiary requirements. Based on facts currently available, we believe the disposition of the claims that are pending or asserted will not have a materially adverse effect on our financial position, results of operations or cash flow. Business Combination Accounting We allocate the consideration of an acquired business to its identifiable assets and liabilities based on estimated fair values. The excess of the consideration over the amount allocated to the assets and liabilities, if any, is recorded to goodwill. We use all available information to estimate fair values. We typically engage third party valuation specialists to assist in the fair value determination of inventories, tangible long-lived assets, and intangible assets other than goodwill. The carrying values of acquired receivables and accounts payable have historically approximated their fair values as of the business combination date. As necessary, we may engage third party specialists to assist in the estimation of fair value for certain liabilities, such as deferred revenue or postretirement benefit liabilities. We adjust the preliminary acquisition accounting, as necessary, typically up to one year after the acquisition closing date as we obtain more information regarding asset valuations and liabilities assumed. Revenue Recognition We recognize revenue consistent with the principles as outlined in the following five step model: (1) identify the contract with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) each performance obligation is satisfied. See Note 3. Gain from Patent Litigation On July 5, 2011, the Company’s wholly-owned subsidiary, PPC, filed an action for patent infringement against Corning alleging that Corning infringed two of PPC’s patents. In July 2015, a jury found that Corning willfully infringed both patents. Following a series of appeals, we received a pre-tax amount of approximately $62.1 million from Corning on July 19, 2018. We recorded the $62.1 million of cash received as a pre-tax gain from patent litigation during 2018. Prior to 2018, we had not recognized any amounts in our consolidated financial statements related to this matter. On September 27, 2018, Corning filed a petition for certiorari review by the U.S. Supreme Court. On December 10, 2018, Corning’s certiorari review by the Supreme Court was denied, thus exhausting their opportunities for further appellate relief. Cost of Sales Cost of sales includes our total cost of inventory sold during the period, including material, labor, production overhead costs, variable manufacturing costs, and fixed manufacturing costs. Production overhead costs include operating supplies, applicable utility expenses, maintenance costs, and scrap. Variable manufacturing costs include inbound, interplant, and outbound freight, inventory shrinkage, and charges for excess and obsolete inventory. Fixed manufacturing costs include the costs associated with our purchasing, receiving, inspection, warehousing, distribution centers, production and inventory control, and manufacturing management. Cost of sales also includes the costs to provide maintenance and support and other professional services. Shipping and Handling Costs We recognize fees earned on the shipment of product to customers as revenues and recognize costs incurred on the shipment of product to customers as a cost of sales. Selling, General and Administrative Expenses Selling, general and administrative expenses include expenses not directly related to the production of inventory. They include all expenses related to selling and marketing our products, as well as the salary and benefit costs of associates performing the selling and marketing functions. Selling, general and administrative expenses also include salary and benefit costs, purchased services, and other costs related to our executive and administrative functions. Research and Development Costs Research and development costs are expensed as incurred. Advertising Costs Advertising costs are expensed as incurred. Advertising costs were $23.5 million, $25.0 million, and $27.2 million for 2018, 2017, and 2016, respectively. Share-Based Compensation We compensate certain employees and non-employee directors with various forms of share-based payment awards and recognize compensation costs for these awards based on their fair values. We estimate the fair values of certain awards, primarily stock appreciation rights (SARs), on the grant date using the Black-Scholes-Merton option-pricing formula, which incorporates certain assumptions regarding the expected term of an award and expected stock price volatility. We develop the expected term assumption based on the vesting period and contractual term of an award, our historical exercise and cancellation experience, our stock price history, plan provisions that require exercise or cancellation of awards after employees terminate, and the extent to which currently available information indicates that the future is reasonably expected to differ from past experience. We develop the expected volatility assumption based on historical price data for our common stock. We estimate the fair value of certain restricted stock units with service vesting conditions and performance vesting conditions based on the grant date stock price. We estimate the fair value of certain restricted stock units with market conditions using a Monte Carlo simulation valuation model with the assistance of a third party valuation firm. After calculating the aggregate fair value of an award, we use an estimated forfeiture rate to discount the amount of share-based compensation cost expected to be recognized in our operating results over the service period of the award. We develop the forfeiture assumption based on our historical pre-vesting cancellation experience. Income Taxes Income taxes are provided based on earnings reported for financial statement purposes. The provision for income taxes differs from the amounts currently payable to taxing authorities because of the recognition of revenues and expenses in different periods for income tax purposes than for financial statement purposes. Income taxes are provided as if operations in all countries, including the U.S., were stand-alone businesses filing separate tax returns. We recognize deferred tax assets resulting from tax credit carryforwards, net operating loss carryforwards, and deductible temporary differences between taxable income on our income tax returns and pretax income on our financial statements. Deferred tax assets generally represent future tax benefits to be received when these carryforwards can be applied against future taxable income or when expenses previously reported in our Consolidated Financial Statements become deductible for income tax purposes. A deferred tax asset valuation allowance is required when some portion or all of the deferred tax assets may not be realized. At December 31, 2018 the valuation allowance of $90.9 million was primarily related to net operating losses and foreign tax credits that we are not expected to realize. Our effective tax rate is based on expected income, statutory tax rates, and tax planning opportunities available to us in the various jurisdictions in which we operate. Significant judgment is required in determining our effective tax rate and in evaluating our tax positions. We establish accruals for uncertain tax positions when we believe that the full amount of the associated tax benefit may not be realized. To the extent we were to prevail in matters for which accruals have been established or would be required to pay amounts in excess of reserves, there could be a material effect on our income tax provisions in the period in which such determination is made. On December 22, 2017, the “Tax Cuts and Jobs Act” (the “Act”) was signed into law, making significant changes to the U.S. Internal Revenue Code. Changes include, but are not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning after December 31, 2017, the transition of U.S. international taxation from a worldwide tax system to a territorial tax system, and a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017. In accordance with the Act, we recorded $28.4 million as additional income tax expense in the fourth quarter of 2017, the period in which the legislation was enacted. The total income tax expense included a $36.0 million tax benefit for the remeasurement of deferred tax assets and liabilities to the 21% rate at which they are expected to reverse, offset with a one-time tax expense on deemed repatriation of $29.1 million and a valuation allowance of $35.3 million recorded against foreign tax credit carryovers that we no longer expect to be able to realize based upon the new tax law. Additionally, Staff Accounting Bulletin No. 118 (“SAB 118”) was issued to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Act. December 22, 2018 marked the end of the measurement period for purposes of SAB 118. As such, we have completed our analysis based on legislative updates relating to the Act currently available which resulted in an additional SAB 118 tax expense of $10.0 million for the year ended December 31, 2018. The total tax expense included an $8.0 million tax expense associated with an increase to the valuation allowance against foreign tax credit carryovers that we no longer expect to be able to realize based upon the new tax law, a $1.3 million tax expense adjustment to the transition tax on the deemed repatriation of cumulative foreign earnings, a $1.1 million tax expense resulting from a valuation allowance established on the deferred tax assets associated with stock options of covered employees, and a $0.4 million income tax benefit associated with an adjustment to the remeasurement of certain deferred tax assets and liabilities. See Note 15, Income Taxes, in the accompanying notes to our consolidated financial statements. Current-Year Adoption of Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09), which replaced most existing revenue recognition guidance in U.S. GAAP. The core principle of the ASU is that an entity should recognize revenue for the transfer of goods or services equal to the amount that it expects to be entitled to receive for those goods or services. ASU 2014-09 requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. We adopted ASU 2014-09 on January 1, 2018, using the modified retrospective method of adoption. Adoption resulted in a $2.6 million, net of tax increase to retained earnings. This adjustment primarily relates to the deferral of costs to obtain a contract that were previously expensed at the beginning of the contract period. In August 2016, the FASB issued Accounting Standards Update No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15). The new guidance addresses how the following eight specific cash flow items are to be presented: Debt prepayment or debt extinguishment costs; settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; contingent consideration payments made after a business combination; proceeds from the settlement of insurance claims; proceeds from the settlement of corporate-owned life insurance policies (including bank-owned life insurance policies); distributions received from equity method investees; beneficial interests in securitization transactions; and separately identifiable cash flows and application of the predominance principle. We adopted ASU 2016-15 on January 1, 2018. The adoption had no material impact on our statement of cash flows for the year ended December 31, 2018. In October 2016, the FASB issued Accounting Standards Update No. 2016-16, Intra-Entity Transfers of Assets Other Than Inventory (ASU 2016-16), which requires recognition of the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. Consequently, the standard eliminates the exception to the recognition of current and deferred income taxes for an intra-entity asset transfer other than for inventory until the asset has been sold to an outside party. We adopted ASU 2016-16 on January 1, 2018. The adoption resulted in a $3.0 million and $46.9 million decrease to other current assets and other long-lived assets, respectively, as well as an $18.2 million increase in deferred income tax assets and a $31.7 million decrease to retained earnings on January 1, 2018. The adoption had no material impact on our results of operations. In March 2017, the FASB issued ASU 2017-07, which requires an entity to report the service cost component in the same line item or items as other compensation costs arising from the service rendered by their employees during the period. The other components of net benefit cost are required to be presented in the Statement of Operations separately from the service cost component after Operating Income. Additionally, only the service cost component is eligible for capitalization, when applicable. The standard requires the amendments to be applied retrospectively for the presentation of the service cost component and the other cost components of net periodic pension cost and net periodic OPEB cost in the Statement of Operations and prospectively, on and after the effective date, for the capitalization of the service cost component of net periodic pension and OPEB costs. We adopted ASU 2017-07 on January 1, 2018, and elected to use the practical expedient related to the retrospective presentation requirements. Adoption resulted in a $0.7 million and $8.2 million increase to operating income for the years ended December 31, 2017 and 2016, respectively, but no changes to net income. In January 2018, the FASB released guidance on the accounting for tax on the global intangible low-taxed income (“GILTI”) provisions of the Tax Cuts and Jobs Act (the “Act”). The GILTI provisions impose a tax on foreign income in excess of a deemed return on tangible assets of foreign corporations. In the fourth quarter of 2018, the Company elected to treat any potential GILTI inclusions as a period cost. In August 2018, the FASB issued ASU No. 2018-14 (“ASU 2018-14”), Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans. The amendments in ASU 2018-14 remove certain disclosures, clarify the specific requirements of disclosures, and add new disclosure requirements, including (1) the weighted-average interest crediting rates for cash balance plans and other plans with promised interest crediting rates and (2) an explanation of the reasons for significant gains and losses related to changes in the benefit obligation for the period. The amendments are effective for fiscal years ending after December 15, 2020, and early adoption is permitted. We early adopted ASU 2018-14 in 2018. The adoption had no impact on our financial statements; only our disclosures. See Note 16. Pending Adoption of Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (ASU 2016-02), a leasing standard for both lessees and lessors that supersedes the lease requirements in Accounting Standards Codification (ASC) Topic 840, "Leases." Under its core principle, a lessee will recognize a right-of-use asset and lease liability on the balance sheet for nearly all leased assets. Lessor accounting remains largely consistent with existing U.S. generally accepted accounting principles. We plan to adopt ASU 2016-02 on January 1, 2019 using the newly permitted transition method issued in July 2018, under ASU No. 2018-11 (“ASU 2018-11”), Leases: Targeted Improvements, which provides an additional (and optional) transition method for adopting the new lease standard. Under this transition method, an entity initially applies the new lease standard at the adoption date and recognizes a cumulative effect adjustment to opening retained earnings in the period of adoption. Furthermore, we plan to elect the following practical expedients and accounting policy elections upon adoption: (i) the package of practical expedients as defined in ASU 2016-02, (ii) the short-term lease accounting policy election, (iii) the practical expedient to not separate non-lease components from lease components, and (iv) the easement practical expedient, which permits an entity to continue applying its current policy for accounting for land easements that existed as of the effective date of ASU 2016-02. We are implementing changes to our systems and processes in response to the new standard. We expect the adoption will result in an increase to our total assets and liabilities on our consolidated balance sheet between $68 million and $78 million, before considering deferred taxes. The adoption is not expected to have a material impact on our results of operations. In August 2017, the FASB issued Accounting Standards Update No. ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. The new guidance better aligns an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The new guidance also makes certain targeted improvements to simplify the application of hedge accounting guidance and ease the administrative burden of hedge documentation requirements and assessing hedge effectiveness. The standard is effective for fiscal years beginning after December 15, 2018, and early adoption is permitted. We do not expect the standard to have a material impact on our consolidated financial statements and related disclosures. In February 2018, the FASB issued ASU No. 2018-02 (“ASU 2018-02”), Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. ASU 2018-02 provides an option to allow reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017. The new guidance is effective for annual and interim periods beginning after December 15, 2018, and early adoption is permitted. We are currently evaluating the impact this update will have on our condensed consolidated financial statements and related disclosures. In June 2018, the FASB issued ASU No. 2018-07 (“ASU 2018-07”), Improvements to Nonemployee Share-Based Payment Accounting. The amendments in ASU 2018-07 expand the scope of Topic 718, Compensation - Stock Compensation, to include share-based payment transactions for acquiring goods and services from non-employees, and provide that non-employee share-based payment awards be measured at their grant-date fair value and the probability of satisfying performance conditions be taken into account when non-employee share-based payment awards contain such conditions. The standard is effective for fiscal years beginning after December 15, 2018, and early adoption is permitted. We are currently evaluating the impact this update will have on our condensed consolidated financial statements and related disclosures. In August 2018, the Securities and Exchange Commission (“SEC”) adopted the final rule under SEC Release No. 33-10532, Disclosure Update and Simplification, amending certain disclosure requirements that were redundant, duplicative, overlapping, outdated or superseded. Additionally, the amendments expanded the disclosure requirements on the analysis of stockholders' equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders' equity presented in the balance sheet must be provided in a note or separate statement. The analysis should present a reconciliation of the beginning balance to the ending balance of each period presented. The amendments were effective on November 5, 2018, however, the SEC staff recently clarified in a Compliance and Disclosure Interpretation (C&DI) that it would not object if a registrant waits until it files Form 10-Q for the quarter that begins after the effective date to comply with the new requirements pertaining to the equity reconciliation but can adopt the other amendments upon effectiveness. We are in the process of evaluating the impact of the final rule on its consolidated financial statements. |
Revenues |
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Revenues | Revenues On January 1, 2018, we adopted Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with the accounting standards in effect for those periods. We recorded a net increase to retained earnings of $2.6 million as of January 1, 2018 due to the cumulative impact of adopting Topic 606, with the impact primarily related to sales commissions and software revenues within our Industrial Solutions segment. There was no significant impact to revenues for the year ended December 31, 2018 as a result of applying Topic 606. Revenues are recognized when control of the promised goods or services is transferred to our customers and in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Taxes collected from customers and remitted to governmental authorities are not included in our revenues. We do not evaluate a contract for a significant financing component when the time between cash collection and performance is less than one year. The following tables present our revenues disaggregated by major product category.
The following tables present our revenues disaggregated by geography, based on the location of the customer purchasing the product.
The following tables present our revenues disaggregated by products, including software products, and support and services.
We generate revenues primarily by selling products that provide secure and reliable transmission of data, sound, and video for mission critical applications. We also generate revenues from providing support and professional services. We sell our products to distributors, end-users, installers, and directly to original equipment manufacturers. At times, we enter into arrangements that involve the delivery of multiple performance obligations. For these arrangements, revenue is allocated to each performance obligation based on its relative standalone selling price and recognized when or as each performance obligation is satisfied. Most of our performance obligations related to the sale of products are satisfied at a point in time when control of the product is transferred based on the shipping terms of the arrangement. Generally, we determine standalone selling price using the prices charged to customers on a standalone basis. The amount of consideration we receive and revenue we recognize varies due to rebates, returns, and price adjustments. We estimate the expected rebates, returns, and price adjustments based on an analysis of historical experience, anticipated sales demand, and trends in product pricing. We adjust our estimate of revenue at the earlier of when the most likely amount of consideration we expect to receive changes or when the consideration becomes fixed. Adjustments to revenue for performance obligations satisfied in prior periods was not significant during the year ended December 31, 2018. Accrued rebates and accrued returns as of December 31, 2018 totaled $41.3 million and $11.9 million, respectively. Estimated price adjustments recognized against our gross accounts receivable balance as of December 31, 2018 totaled $25.1 million. Depending on the terms of an arrangement, we may defer the recognition of a portion of the consideration received because we have to satisfy a future obligation. Consideration allocated to support services under a support and maintenance contract is typically paid in advance and recognized ratably over the term of the service. Consideration allocated to professional services is recognized when or as the services are performed depending on the terms of the arrangement. As of January 1, 2018, total deferred revenue was $104.4 million, and during 2018, $202.1 million of revenue was deferred and $193.2 million of revenue was recognized. Thus, as of December 31, 2018, total deferred revenue was $113.3 million, and of this amount, $101.2 million will be recognized within the next twelve months, and the remaining $12.1 million is long-term and will be recognized over a period greater than twelve months. We expense sales commissions as incurred when the duration of the related revenue arrangement is one year or less. We capitalize sales commissions in other current and long-lived assets on our balance sheet when the duration of the related revenue arrangement is longer than one year, and we amortize it over the related revenue arrangement period. Total capitalized sales commissions was $2.9 million as of December 31, 2018. Total sales commissions costs were $23.3 million during the year ended December 31, 2018. Sales commissions are recorded within selling, general and administrative expenses. |
Acquisitions |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisitions | Acquisitions Net-Tech Technology, Inc. We acquired 100% of the shares of NT2 on April 25, 2018 for a purchase price of $8.5 million that was funded with cash on hand. NT2 is an integrator of optical passive components and network optimization products used within broadband network applications where optical backhaul is used. NT2 is located in the United States. The results of NT2 have been included in our Consolidated Financial Statements from April 25, 2018, and are reported within the Enterprise Solutions segment. The NT2 acquisition was not material to our financial position or results of operations. Snell Advanced Media We acquired 100% of the outstanding ownership interest in SAM on February 8, 2018 for a purchase price, net of cash acquired, of $104.5 million. Of the $104.5 million purchase price, $75.2 million was paid on February 8, 2018 and was funded with cash on hand. The acquisition included a potential earnout, which was based upon future combined earnings of SAM and Grass Valley through December 31, 2019. The maximum earnout consideration is $31.4 million, but based upon a third party valuation specialist using certain assumptions in a discounted cash flow model, the preliminary estimated fair value of the earnout included in the purchase price was $29.3 million. We assumed debt of $19.3 million and paid it off during the first quarter of 2018. SAM designs, manufactures, and sells innovative content production and distribution systems for the broadcast and media markets. SAM is headquartered in the United Kingdom. The results of SAM have been included in our Consolidated Financial Statements from February 8, 2018, and are reported within the Enterprise Solutions segment. The following table summarizes the estimated, preliminary fair value of the assets acquired and the liabilities assumed as of February 8, 2018 (in thousands):
The above acquisition accounting is preliminary, and is subject to revision as additional information about the fair value of individual assets and liabilities becomes available. The preliminary measurement of receivables; inventories; property, plant and equipment; intangible assets; goodwill; deferred income taxes; deferred revenue; and other assets and liabilities are subject to change. A change in the estimated fair value of the net assets acquired will change the amount of the purchase price allocable to goodwill. During the fourth quarter 2018, we recorded measurement-period adjustments that increased goodwill by approximately $15 million primarily for changes in the fair value of intangible assets and deferred revenue. The impact of these adjustments to the consolidated statement of operations was immaterial. A single estimate of fair value results from a complex series of judgments about future events and uncertainties and relies heavily on estimates and assumptions. The judgments we have used in estimating the preliminary fair values assigned to each class of acquired assets and assumed liabilities could materially affect the results of our operations. The preliminary fair value of acquired receivables is $16.6 million, which is equivalent to its gross contractual amount. For purposes of the above allocation, we based our estimates of the preliminary fair values for the acquired inventory; property, plant, and equipment; intangible assets; and deferred revenue on preliminary valuation studies performed by a third party valuation firm. We have estimated a preliminary fair value adjustment for inventories based on the estimated selling price of the work-in-process and finished goods acquired at the closing date less the sum of the costs to complete the work-in-process, the costs of disposal, and a reasonable profit allowance for our post acquisition selling efforts. To determine the value of the acquired property, plant, and equipment, we used various valuation methods, including both the market approach, which considers sales prices of similar assets in similar conditions (Level 2 valuation), and the cost approach, which considers the cost to replace the asset adjusted for depreciation (Level 3 valuation). We used various valuation methods including discounted cash flows, lost income, excess earnings, and relief from royalty to estimate the preliminary fair value of the identifiable intangible assets and deferred revenue (Level 3 valuation). Goodwill and other intangible assets reflected above were determined to meet the criteria for recognition apart from tangible assets acquired and liabilities assumed. The goodwill is primarily attributable to expected synergies and the assembled workforce. The expected synergies for the SAM acquisition may be gained from cost synergies and helping broadcast and media content creators, aggregators and distributors significantly improve their effectiveness and efficiency during a period of rapid change in technology, viewer and advertiser behavior and business models. Our tax basis in the acquired goodwill is zero. The intangible assets related to the acquisition consisted of the following:
The amortizable intangible assets reflected in the table above were determined by us to have finite lives. The useful life for the developed technology intangible asset was based on the estimated time that the technology provides us with a competitive advantage and thus approximates the period and pattern of consumption of the intangible asset. The useful life for the customer relationship intangible asset was based on our forecasts of estimated sales from recurring customers. The useful life of the backlog intangible asset was based on our estimate of when the ordered items would ship. The useful life for the trademarks was based on the period of time we expect to continue to go to market using the trademarks. Our consolidated revenues for the year ended December 31, 2018 included an estimated $106.3 million from SAM. Due to the integration of SAM into our existing business, we are unable to reasonably estimate the amount of income before taxes from SAM included in our consolidated financial statements. Our consolidated income before taxes for the year ended December 31, 2018 included $46.1 million of severance and other restructuring costs, $10.6 million of amortization of intangible assets, and $1.8 million of cost of sales related to the adjustment of acquired inventory to fair value from SAM. The following table illustrates the unaudited pro forma effect on operating results as if the SAM acquisition had been completed as of January 1, 2017.
For purposes of the pro forma disclosures, the year ended December 31, 2017 includes nonrecurring expenses related to the acquisition, including severance, restructuring, and acquisition integration costs; amortization of the sales backlog intangible asset; and cost of sales arising from the adjustment of inventory to fair value of $46.1 million, $1.9 million, and $1.7 million, respectively. The above unaudited pro forma financial information is presented for informational purposes only and does not purport to represent what our results of operations would have been had we completed the acquisition on the date assumed, nor is it necessarily indicative of the results that may be expected in future periods. Pro forma adjustments exclude cost savings from any synergies resulting from the acquisition. Thinklogical Holdings, LLC We acquired 100% of the outstanding ownership interest in Thinklogical on May 31, 2017 for cash of $165.8 million. Thinklogical designs, manufactures, and markets high-bandwidth fiber matrix switches, video, and keyboard/video/mouse extender solutions, camera extenders, and console management solutions. Thinklogical is headquartered in Connecticut. The results of Thinklogical have been included in our Consolidated Financial Statements from May 31, 2017, and are reported within the Enterprise Solutions segment. The following table summarizes the estimated fair values of the assets acquired and the liabilities assumed as of May 31, 2017 (in thousands):
A single estimate of fair value results from a complex series of judgments about future events and uncertainties and relies heavily on estimates and assumptions. The judgments we have used in estimating the fair values assigned to each class of acquired assets and assumed liabilities could materially affect the results of our operations. The fair value of acquired receivables is $4.4 million, which is equivalent to its gross contractual amount. For purposes of the above allocation, we based our estimate of the fair value for the acquired inventory, intangible assets, and deferred revenue on a valuation study performed by a third party valuation firm. We used various valuation methods including discounted cash flows, lost income, excess earnings, and relief from royalty to estimate the preliminary fair value of the identifiable intangible assets and deferred revenue (Level 3 valuation). The determination of the fair value of the assets acquired and liabilities assumed and the allocation of the purchase price is complete. Goodwill and other intangible assets reflected above were determined to meet the criterion for recognition apart from tangible assets acquired and liabilities assumed. The goodwill is primarily attributable to expected synergies and the assembled workforce. The expected synergies for the Thinklogical acquisition primarily consist of utilizing Belden's fiber and connectivity portfolio with Thinklogical's connections between matrix switch, control systems, transmitters and source to expand our product portfolio across our segments to both existing and new customers. Our tax basis in the acquired goodwill is approximately $43.3 million and is deductible for tax purposes over a period of 15 years up to the amount of the tax basis. The intangible assets related to the acquisition consisted of the following:
The amortizable intangible assets reflected in the table above were determined by us to have finite lives. The useful life for the customer relationship intangible asset was based on our forecasts of estimated sales from recurring customers. The useful life for the trademarks was based on the period of time we expect to continue to go to market using the trademarks. The useful life for the developed technology intangible asset was based on the estimated time that the technology provides us with a competitive advantage and thus approximates the period and pattern of consumption of the intangible asset. The useful life of the backlog intangible asset was based on our estimate of when the ordered items would ship. Our consolidated revenues and consolidated income before taxes for the year ended December 31, 2017 included $30.8 million and $(8.9) million, respectively, from Thinklogical. The loss before taxes from Thinklogical included $11.9 million of amortization of intangible assets and $6.1 million of cost of sales related to the adjustment of acquired inventory to fair value. The following table illustrates the unaudited pro forma effect on operating results as if the Thinklogical acquisition had been completed as of January 1, 2016.
For purposes of the pro forma disclosures, the year ended December 31, 2016 includes nonrecurring expenses from the effects of purchase accounting, including cost of sales arising from the adjustment of inventory to fair value of $6.1 million and amortization of the sales backlog intangible asset of $1.4 million. The above unaudited pro forma financial information is presented for informational purposes only and does not purport to represent what our results of operations would have been had we completed the acquisition on the date assumed, nor is it necessarily indicative of the results that may be expected in future periods. Pro forma adjustments exclude cost savings from any synergies resulting from the acquisition. M2FX We acquired 100% of the shares of M2FX on January 7, 2016 for a purchase price of $19.0 million. M2FX is a manufacturer of fiber optic cable and fiber protective solutions for broadband access and telecommunications networks. M2FX is located in the United Kingdom. The results of M2FX have been included in our Consolidated Financial Statements from January 7, 2016, and are reported within the Enterprise Solutions segment. The M2FX acquisition was not material to our financial position or results of operations. Of the total purchase price, $3.2 million was deferred as estimated earn-out consideration. We determined the estimated fair value of the earn-out with the assistance of a third party valuation specialist using a probability weighted discounted cash flow model. The estimated earn-out was scheduled to be paid in early 2017, however, the financial targets tied to the earn-out were not achieved. We reduced the earn-out liability to zero as of December 31, 2016 and recognized a $3.2 million benefit in Selling, General and Administrative expenses in the Consolidated Statements of Operations. This benefit was excluded from Segment EBITDA of our Enterprise Solutions segment. |
Operating Segments and Geographic Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating Segments and Geographic Information | Operating Segments and Geographic Information Effective January 1, 2018, we changed our organizational structure and, as a result, now are reporting two segments. The segments formerly known as Broadcast Solutions and Enterprise Solutions now are presented as the Enterprise Solutions segment, and the segments formerly known as Industrial Solutions and Network Solutions now are presented as the Industrial Solutions segment. The reorganization allows us to further accelerate progress in key strategic areas, and the segment consolidation properly aligns our external reporting with the way the businesses are now managed. We have recast the prior period segment information to conform to the change in the composition of these reportable segments. This change had no impact to our reporting units for purposes of goodwill impairment testing. We have determined that each of the global business platforms represents a reportable segment. The segments design, manufacture, and market a portfolio of signal transmission solutions for mission critical applications used in a variety of end markets, including broadcast, enterprise, and industrial. We sell the products manufactured by our segments principally through distributors or directly to systems integrators, original equipment manufacturers (OEMs), end-users, and installers. The key measures of segment profit or loss reviewed by our chief operating decision maker are Segment Revenues and Segment EBITDA. Segment Revenues represent non-affiliate revenues and include revenues that would have otherwise been recorded by acquired businesses as independent entities but were not recognized in our Consolidated Statements of Operations due to the effects of purchase accounting and the associated write-down of acquired deferred revenue to fair value. Segment EBITDA excludes certain items, including depreciation expense; amortization of intangibles; asset impairment; severance, restructuring, and acquisition integration costs; purchase accounting effects related to acquisitions, such as the adjustment of acquired inventory and deferred revenue to fair value; and other costs. We allocate corporate expenses to the segments for purposes of measuring Segment EBITDA. Corporate expenses are allocated on the basis of each segment’s relative EBITDA prior to the allocation. Our measure of segment assets does not include cash, goodwill, intangible assets, deferred tax assets, or corporate assets. All goodwill is allocated to reporting units of our segments for purposes of impairment testing. The results of our former equity method investment in the Hirschmann JV, which we sold effective December 31, 2017, were not included in the corporate expense allocation. Operating Segment Information
The following table is a reconciliation of the total of the reportable segments’ Revenues and EBITDA to consolidated revenues and consolidated income before taxes, respectively.
Below are reconciliations of other segment measures to the consolidated totals.
Geographic Information The Company attributes foreign sales based on the location of the customer purchasing the product. The table below summarizes net sales and long-lived assets for the years ended December 31, 2018, 2017 and 2016 for the following countries: the U.S., Canada, China, and Germany. No other individual foreign country’s net sales or long-lived assets are material to the Company.
Major Customer Revenues generated from sales to the distributor Anixter International Inc., in both the Enterprise Solutions and Industrial Solutions segments, were $309.0 million (12% of revenues), $292.2 million (12% of revenues), and $286.2 million (12% of revenues) for 2018, 2017, and 2016, respectively. At December 31, 2018, we had $37.0 million in accounts receivable outstanding from Anixter International Inc. This represented approximately 8% of our total accounts receivable outstanding at December 31, 2018. |
Noncontrolling Interest |
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Noncontrolling Interest [Abstract] | |
Noncontrolling Interest | Noncontrolling Interest We have a 51% ownership percentage in a joint venture with Shanghai Hi-Tech Control System Co, Ltd (Hite). The purpose of the joint venture is to develop and provide certain Industrial Solutions products and integrated solutions to customers in China. Belden and Hite are committed to fund $1.53 million and $1.47 million, respectively, to the joint venture in the future. The joint venture is determined to not have sufficient equity at risk; therefore, it is considered a variable interest entity. We have determined that Belden is the primary beneficiary of the joint venture, due to both our ownership percentage and our control over the activities of the joint venture that most significantly impact its economic performance based on the terms of the joint venture agreement with Hite. Because Belden is the primary beneficiary of the joint venture, we have consolidated the joint venture in our financial statements. The results of the joint venture attributable to Hite’s ownership are presented as net loss attributable to noncontrolling interest in the consolidated statements of operations. The joint venture is not material to our consolidated financial statements as of or for the years ended December 31, 2018, 2017, or 2016. |
Income Per Share |
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Income Per Share | Income Per Share The following table presents the basis of the income per share computation:
For the years ended December 31, 2018, 2017, and 2016, diluted weighted average shares outstanding do not include outstanding equity awards of 0.9 million, 0.5 million, and 0.6 million, respectively, because to do so would have been anti-dilutive. In addition, for the years ended December 31, 2018, 2017, and 2016, diluted weighted average shares outstanding do not include outstanding equity awards of 0.3 million, 0.2 million, and 0.1 million, respectively, because the related performance conditions have not been satisfied. Furthermore, for the years ended December 31, 2018, 2017, and 2016, diluted weighted average shares outstanding do not include the weighted average impact of preferred shares that are convertible into 6.9 million, 6.9 million, and 3.0 million common shares, respectively, because deducting the preferred stock dividends from net income was more dilutive. For purposes of calculating basic earnings per share, unvested restricted stock units are not included in the calculation of basic weighted average shares outstanding until all necessary conditions have been satisfied and issuance of the shares underlying the restricted stock units is no longer contingent. Necessary conditions are not satisfied until the vesting date, at which time holders of our restricted stock units receive shares of our common stock. For purposes of calculating diluted earnings per share, unvested restricted stock units are included to the extent that they are dilutive. In determining whether unvested restricted stock units are dilutive, each issuance of restricted stock units is considered separately. Once a restricted stock unit has vested, it is included in the calculation of both basic and diluted weighted average shares outstanding. |
Inventories |
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Inventories | Inventories The major classes of inventories were as follows:
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Property, Plant and Equipment | Property, Plant and Equipment The carrying values of property, plant and equipment were as follows:
Depreciation Expense We recognized depreciation expense of $47.6 million, $45.6 million, and $47.2 million in 2018, 2017, and 2016, respectively. |
Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets | Intangible Assets The carrying values of intangible assets were as follows:
Segment Allocation of Goodwill and Trademarks The changes in the carrying amount of goodwill assigned to reporting units in our reportable segments are as follows:
The changes in the carrying amount of indefinite-lived trademarks are as follows:
Impairment The annual measurement date for our goodwill and indefinite-lived intangible assets impairment test is our fiscal November month-end. For our 2018 goodwill impairment test, we performed a quantitative assessment for four of our reporting units and determined the estimated fair values of our reporting units by calculating the present values of their estimated future cash flows using Level 3 inputs. We determined that the fair values of the reporting units were in excess of the carrying values; therefore, we did not record any goodwill impairment for the four reporting units. We performed a qualitative assessment for the remaining seven of our reporting units, and we determined that it was more likely than not that the fair value was greater than the carrying value. Therefore, we did not record any goodwill impairment for the seven reporting units. We also did not recognize any goodwill impairment in 2017 or 2016 based on the results of our annual goodwill impairment testing. Similar to the quantitative goodwill impairment test, we determined the estimated fair values of our indefinite-lived trademarks by calculating the present values of the estimated cash flows (using Level 3 inputs) attributable to the respective trademarks. We did not recognize any trademark impairment charges in 2018, 2017, or 2016. Amortization Expense We recognized amortization expense in income from continuing operations of $101.0 million, $104.0 million, and $98.4 million in 2018, 2017, and 2016, respectively. We expect to recognize annual amortization expense of $90.4 million in 2019, $74.4 million in 2020, $42.1 million in 2021, $38.2 million in 2022, and $29.3 million in 2023 related to our intangible assets balance as of December 31, 2018. The weighted-average amortization period for our customer relationships, trademarks, developed technology, and in-service research and development is 18.4 years, 7.9 years, 6.5 years, and 5.0 years, respectively. In connection with a segment change in 2017, we re-evaluated the useful life of the Tripwire trademark and concluded that an indefinite life was no longer appropriate. We estimated a useful life of 10 years and will re-evaluate this estimate if and when our expected use of the Tripwire trademark changes. We began amortizing the Tripwire trademark in 2017, which resulted in amortization expense of $3.1 million for each of the years ended December 31, 2018 and 2017. As of December 31, 2018, the net book value of the Tripwire trademark was $24.8 million. |
Accrued Liabilities |
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Accrued Liabilities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Liabilities | Accrued Liabilities The carrying values of accrued liabilities were as follows:
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Severance, Restructuring, and Acquisition Integration Activities |
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Severance, Restructuring, and Acquisition Integration Activities | Severance, Restructuring, and Acquisition Integration Activities Grass Valley and SAM Integration Program: 2018 During the first quarter of 2018, we began a restructuring program to integrate SAM with Grass Valley. The restructuring and integration activities are focused on achieving desired cost savings by consolidating existing and acquired facilities and other support functions. We recognized $42.3 million of severance and other restructuring costs for this program during 2018. The costs were incurred by the Enterprise Solutions segment. We expect to incur approximately $3 million of additional severance and restructuring costs for this program, which will be incurred during the first quarter of 2019. Industrial Manufacturing Footprint Program: 2016-2018 In 2016, we began a program to consolidate our manufacturing footprint. The manufacturing consolidation is complete. We recognized $17.7 million, $30.6 million, and $17.8 million of severance and other restructuring costs for this program during 2018, 2017, and 2016, respectively. The costs were incurred by the Enterprise Solutions and Industrial Solutions segments, as the manufacturing locations involved in the program serve both platforms. To date, we have incurred a total of $66.1 million in severance and other restructuring costs, including manufacturing inefficiencies for this program. The following tables summarize the costs by segment of the various programs described above as well as other immaterial programs and acquisition integration activities:
The other restructuring and integration costs primarily consisted of equipment transfers, costs to consolidate operating and support facilities, retention bonuses, relocation, travel, legal, and other costs. The majority of the other restructuring and integration costs related to these actions were paid as incurred or are payable within the next 60 days. Of the total severance, restructuring, and acquisition integration costs recognized during 2018, $28.1 million, $35.0 million, and $5.5 million were included in cost of sales; selling, general and administrative expenses; and research and development expenses, respectively. Of the total severance, restructuring, and acquisition integration costs recognized during 2017, $32.6 million, $10.0 million, and $0.2 million were included in cost of sales; selling, general and administrative expenses; and research and development expenses, respectively. Of the total severance and other restructuring costs recognized during 2016, $12.3 million, $18.0 million, and $0.8 million were included in cost of sales; selling, general and administrative expenses; and research and development expenses, respectively. There were no significant severance accrual balances as of December 31, 2018 or 2017. |
Long-Term Debt and Other Borrowing Arrangements |
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Long-Term Debt and Other Borrowing Arrangements | Long-Term Debt and Other Borrowing Arrangements The carrying values of our long-term debt and other borrowing arrangements were as follows:
Revolving Credit Agreement due 2022 In 2017, we entered into an Amended and Restated Credit Agreement (the Revolver) to amend and restate our prior Revolving Credit Agreement. The Revolver provides a $400.0 million multi-currency asset-based revolving credit facility. The borrowing base under the Revolver includes eligible accounts receivable; inventory; and property, plant and equipment of certain of our subsidiaries in the U.S., Canada, Germany, and the Netherlands. The maturity date of the Revolver is May 16, 2022. Interest on outstanding borrowings is variable, based upon LIBOR or other similar indices in foreign jurisdictions, plus a spread that ranges from 1.25%-1.75%, depending upon our leverage position. We pay a commitment fee on our available borrowing capacity of 0.25%. In the event we borrow more than 90% of our borrowing base, we are subject to a fixed charge coverage ratio covenant. In 2017, we recognized a $0.8 million loss on debt extinguishment for unamortized debt issuance costs related to creditors no longer participating in the new Revolver. In connection with executing the Revolver, we also paid $2.3 million of fees to creditors and third parties that we will amortize over the remaining term of the Revolver. As of December 31, 2018, we had no borrowings outstanding on the Revolver, and our available borrowing capacity was $359.1 million. Senior Subordinated Notes In March 2018, we completed an offering for €350.0 million ($431.3 million at issuance) aggregate principal amount of 3.875% senior subordinated notes due 2028 (the 2028 Notes). The carrying value of the 2028 Notes as of December 31, 2018 is $400.1 million. The 2028 Notes are guaranteed on a senior subordinated basis by our current and future domestic subsidiaries. The 2028 Notes rank equal in right of payment with our senior subordinated notes due 2027, 2026, and 2025 and with any future subordinated debt, and they are subordinated to all of our senior debt and the senior debt of our subsidiary guarantors, including our Revolver. Interest is payable semiannually on March 15 and September 15 of each year, which commenced on September 15, 2018. We paid approximately $7.5 million of fees associated with the issuance of the 2028 Notes, which are being amortized over the life of the 2028 Notes using the effective interest method. We used the net proceeds from this offering and cash on hand to repurchase the 2023 and 2024 Notes - see further discussion below. In July 2017, we completed an offering for €450.0 million ($509.5 million at issuance) aggregate principal amount of 3.375% senior subordinated notes due 2027 (the 2027 Notes). The carrying value of the 2027 Notes as of December 31, 2018 is $514.4 million. The 2027 Notes are guaranteed on a senior subordinated basis by our current and future domestic subsidiaries. The 2027 Notes rank equal in right of payment with our senior subordinated notes due 2028, 2026, and 2025 and with any future subordinated debt, and they are subordinated to all of our senior debt and the senior debt of our subsidiary guarantors, including our Revolver. Interest is payable semiannually on January 15 and July 15 of each year, which commenced on January 15, 2018. We paid approximately $8.8 million of fees associated with the issuance of the 2027 Notes, which are being amortized over the life of the 2027 Notes using the effective interest method. In October 2016, we completed an offering for €200.0 million ($222.2 million at issuance) aggregate principal amount of 4.125% senior subordinated notes due 2026 (the 2026 Notes). The carrying value of the 2026 Notes as of December 31, 2018 is $228.6 million. The 2026 Notes are guaranteed on a senior subordinated basis by our current and future domestic subsidiaries. The notes rank equal in right of payment with our senior subordinated notes due 2028, 2027, and 2025 and with any future subordinated debt, and they are subordinated to all of our senior debt and the senior debt of our subsidiary guarantors, including our Revolver. Interest is payable semiannually on April 15 and October 15 of each year, which commenced on April 15, 2017. We paid approximately $3.9 million of fees associated with the issuance of the 2026 Notes, which are being amortized over the life of the 2026 Notes using the effective interest method. In September 2017, we completed an offering for €300.0 million ($357.2 million at issuance) aggregate principal amount of 2.875% senior subordinated notes due 2025 (the 2025 Notes). The carrying value of the 2025 Notes as of December 31, 2018 is $342.9 million. The 2025 Notes are guaranteed on a senior subordinated basis by our current and future domestic subsidiaries. The 2025 Notes rank equal in right of payment with our senior subordinated notes due 2028, 2027, and 2026 and with any future subordinated debt, and they are subordinated to all of our senior debt and the senior debt of our subsidiary guarantors, including our Revolver. Interest is payable semiannually on March 15 and September 15 of each year, which commenced on March 15, 2018. We paid approximately $6.2 million of fees associated with the issuance of the 2025 Notes, which are being amortized over the life of the 2025 Notes using the effective interest method. We had outstanding $200 million aggregate principal amount of 5.25% senior subordinated notes due 2024 (the 2024 Notes). In March 2018, we repurchased $188.7 million of the 2024 Notes outstanding for cash consideration of $199.8 million, including a prepayment penalty and recognized a $13.8 million loss on debt extinguishment including the write-off of unamortized debt issuance costs. In April 2018, we repurchased the remaining 2024 Notes outstanding for cash consideration of $11.9 million, including a prepayment penalty, and recognized a $0.8 million loss on debt extinguishment including the write-off of unamortized debt issuance costs. We had outstanding €200.0 million aggregate principal amount of 5.5% senior subordinated notes due 2023 (the 2023 Notes). In March 2018, we repurchased €143.1 million of the €200.0 million 2023 Notes outstanding for cash consideration of €147.8 million ($182.1 million), including a prepayment penalty and recognized a $6.2 million loss on debt extinguishment including the write-off of unamortized debt issuance costs. In April 2018, we repurchased the remaining 2023 Notes outstanding for cash consideration of €58.5 million ($71.6 million), including a prepayment penalty, and recognized a $2.2 million loss on debt extinguishment including the write-off of unamortized debt issuance costs. The senior subordinated notes due 2025, 2026, 2027 and 2028 are redeemable after September 15, 2020, October 15, 2021, July 15, 2022, and March 15, 2023, respectively, at the following redemption prices as a percentage of the face amount of the notes:
Fair Value of Long-Term Debt The fair value of our senior subordinated notes as of December 31, 2018 was approximately $1,485.0 million based on quoted prices of the debt instruments in inactive markets (Level 2 valuation). This amount represents the fair values of our senior subordinated notes with a carrying value of $1,485.9 million as of December 31, 2018. Maturities Maturities on outstanding long-term debt and other borrowings during each of the five years subsequent to December 31, 2018 are as follows (in thousands):
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Net Investment Hedge |
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Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Net Investment Hedge | Net Investment Hedge All of our euro denominated notes were issued by Belden Inc., a USD functional currency entity. As of December 31, 2018, all of our outstanding foreign denominated debt is designated as a net investment hedge on the foreign currency risk of our net investment in our euro foreign operations. The objective of the hedge is to protect the net investment in the foreign operations against adverse changes in the euro exchange rate. The transaction gain or loss is reported in the cumulative translation adjustment section of other comprehensive income. The amount of the cumulative translation adjustment associated with these notes at December 31, 2018 and 2017 was a gain of $87.5 million and a loss of $56.2 million, respectively. |
Income Taxes |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes
On December 22, 2017, the “Tax Cuts and Jobs Act” (the “Act”) was signed into law, making significant changes to the U.S. Internal Revenue Code. Changes include, but are not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning after December 31, 2017, the transition of U.S. international taxation from a worldwide tax system to a territorial tax system, and a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017. In accordance with the Act, we recorded $28.4 million as an additional income tax expense in the fourth quarter of 2017, the period in which the legislation was enacted. The total income tax expense included a $36.0 million tax benefit for the remeasurement of deferred tax assets and liabilities to the 21% rate at which they are expected to reverse, offset with a one-time tax expense on deemed repatriation of $29.1 million and a valuation allowance of $35.3 million recorded against foreign tax credit carryovers that we no longer expect to be able to realize based upon the new tax law. Additionally, Staff Accounting Bulletin No. 118 (“SAB 118”) was issued to address the application of US GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Act. December 22, 2018 marked the end of the measurement period for purposes of SAB 118. As such, we have completed our analysis based on legislative updates relating to the Act currently available which resulted in an additional SAB 118 tax expense of $2.9 million in the fourth quarter of 2018 and a total tax expense of $10.0 million for the year ended December 31, 2018. The total tax provision expense included an $8.0 million tax expense associated with an increase to the valuation allowance against foreign tax credit carryovers that we no longer expect to be able to realize based upon the new tax law, a $1.3 million tax expense adjustment to the transition tax on the deemed repatriation of cumulative foreign earnings, a $1.1 million tax expense resulting from a valuation allowance established on the deferred tax assets associated with stock options of covered employees, and a $0.4 million income tax benefit associated with an adjustment to the remeasurement of certain deferred tax assets and liabilities. If we were to repatriate foreign cash to the U.S., we may be required to accrue and pay U.S. taxes in accordance with applicable U.S. tax rules and regulations as a result of the repatriation. However, it is our practice and intention to reinvest the earnings of our non-U.S. subsidiaries in those operations. As a result, as of December 31, 2018, we have not made a provision for U.S. or additional foreign withholding taxes. Foreign tax rate differences resulted in an income tax benefit of $4.0 million, $13.0 million, and $17.7 million in 2018, 2017, and 2016, respectively. Additionally, in 2018 and 2017, our income tax expense was reduced by $3.0 million and $3.5 million, respectively, due to a tax holiday for our operations in St. Kitts. The tax holiday in St. Kitts is scheduled to expire in 2022.
The decrease in deferred income tax liabilities associated with plant, equipment and intangibles during 2018 is primarily due to the adoption of ASU 2016-16 in the first quarter of 2018 in which deferred tax assets associated with prior intercompany sales of intangible assets were recorded onto the Company’s balance sheet. The decrease in our net operating loss carryforwards and deferred tax valuation allowances is primarily due to the write-off of certain foreign net operating loss carryforwards and the corresponding valuation allowance associated with those foreign net operating losses. The Company has determined these net operating losses are not realizable as a result of a significant change in business operations that occurred in a prior year. As of December 31, 2018, we had $537.3 million of gross net operating loss carryforwards and $71.0 million of tax credit carryforwards. Unless otherwise utilized, net operating loss carryforwards will expire upon the filing of the tax returns for the following respective years: $0.2 million in 2018, $8.0 million in 2019, $29.4 million between 2020 and 2022, and $167.8 million between 2023 and 2038. Net operating losses with an indefinite carryforward period total $331.9 million. Of the $537.3 million in net operating loss carryforwards, we have determined, based on the weight of all available evidence, both positive and negative, that we will utilize $172.5 million of these net operating loss carryforwards within their respective expiration periods. A valuation allowance has been recorded on the remaining portion of the net operating loss carryforwards. Unless otherwise utilized, tax credit carryforwards of $71.0 million will expire as follows: $1.6 million between 2020 and 2022, $64.2 million between 2023 and 2038. Tax credit carryforwards with an indefinite carryforward period total $5.2 million. We have determined, based on the weight of all available evidence, both positive and negative, that we will utilize $42.7 million of these tax credit carryforwards within their respective expiration periods. A valuation allowance has been recorded on the remaining portion of the tax credit carryforwards. The following tables summarize our net operating loss carryforwards and tax credit carryforwards as of December 31, 2018 by jurisdiction:
In 2018, we recognized a net $1.2 million decrease to reserves for uncertain tax positions. A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:
The additions for tax positions of prior years relates to transition tax. The balance of $7.4 million at December 31, 2018, reflects tax positions that, if recognized, would impact our effective tax rate. As of December 31, 2018, we believe it is reasonably possible that $0.9 million of unrecognized tax benefits will change within the next twelve months primarily attributable to the expected completion of tax audits in the U.S. and foreign jurisdictions. Our practice is to recognize interest and penalties related to uncertain tax positions in interest expense and operating expenses, respectively. During 2016, we recognized reductions of interest expense of $0.2 million related to uncertain tax positions. We do not have any material amounts accrued for the payment of interest and penalties as of December 31, 2018 and 2017. Our federal tax return for the tax years 2015 and later remain subject to examination by the Internal Revenue Service. Belden reached agreement with the Internal Revenue Service for the 2013 and 2014 tax years in December 2018. Our state and foreign income tax returns for the tax years 2010 and later remain subject to examination by various state and foreign tax authorities. |
Pension and Other Postretirement Benefits |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension and Other Postretirement Benefits | Pension and Other Postretirement Benefits We sponsor defined benefit pension plans and defined contribution plans that cover substantially all employees in Canada, the Netherlands, the United Kingdom, the U.S., and certain employees in Germany and Japan. Our plans in the United Kingdom include SAM's defined contribution and defined benefit plans which we acquired during 2018 (see Note 4). The SAM defined benefit plans are frozen and additional benefits are not being earned by the participants. We closed the U.S. defined benefit pension plan to new entrants effective January 1, 2010. Employees who were not active participants in the U.S. defined benefit pension plan on December 31, 2009, are not eligible to participate in the plan. During 2017, we sold our MCS business and its associated pension liabilities. Annual contributions to retirement plans equal or exceed the minimum funding requirements of applicable local regulations. The assets of the funded pension plans we sponsor are maintained in various trusts and are invested primarily in equity and fixed income securities. Benefits provided to employees under defined contribution plans include cash contributions by the Company based on either hours worked by the employee or a percentage of the employee’s compensation. Defined contribution expense for 2018, 2017, and 2016 was $15.2 million, $13.9 million, and $13.5 million, respectively. We sponsor unfunded postretirement medical and life insurance benefit plans for certain of our employees in Canada and the U.S. The medical benefit portion of the U.S. plan is only for employees who retired prior to 1989 as well as certain other employees who were near retirement and elected to receive certain benefits. The following tables provide a reconciliation of the changes in the plans’ benefit obligations and fair value of assets as well as a statement of the funded status and balance sheet reporting for these plans.
The accumulated benefit obligation for all defined benefit pension plans was $412.4 million and $269.2 million at December 31, 2018 and 2017, respectively. The projected benefit obligation, accumulated benefit obligation, and fair value of plan assets for the pension plans with a projected benefit obligation in excess of plan assets were $368.5 million, $362.6 million, and $257.1 million, respectively, as of December 31, 2018 and were $215.6 million, $212.7 million, and $138.5 million, respectively, as of December 31, 2017. The accumulated benefit obligation and fair value of plan assets for other postretirement benefit plans with an accumulated benefit obligation in excess of plan assets were $26.1 million and $0.0 million, respectively, as of December 31, 2018 and were $30.3 million and $0.0 million, respectively, as of December 31, 2017. The following table provides the components of net periodic benefit costs for the plans.
We recorded settlement losses totaling $1.3 million and $7.6 million during 2018 and 2016, respectively. These settlement losses were the result of lump-sum payments to participants that exceeded the sum of the pension plan's respective annual service cost and interest cost amounts. The following table presents the assumptions used in determining the benefit obligations and the net periodic benefit cost amounts.
Plan assets are invested using a total return investment approach whereby a mix of equity securities and fixed income securities are used to preserve asset values, diversify risk, and achieve our target investment return benchmark. Investment strategies and asset allocations are based on consideration of the plan liabilities, the plan’s funded status, and our financial condition. Investment performance and asset allocation are measured and monitored on an ongoing basis. Plan assets are managed in a balanced portfolio comprised of two major components: an asset growth portion and an asset protection portion. The expected role of asset growth investments is to maximize the long-term real growth of assets, while the role of asset protection investments is to generate current income, provide for more stable periodic returns, and provide some protection against a permanent loss of capital. Absent regulatory or statutory limitations, the target asset allocation for the investment of the assets for our ongoing pension plans is 30-40% in asset protection investments and 60-70% in asset growth investments and for our pension plans where the majority of the participants are in payment or terminated vested status is 55-90% in asset protection investments and 10-45% in asset growth investments. Asset growth investments include a diversified mix of U.S. and international equity, primarily invested through investment funds. Asset protection investments include government securities and investment grade corporate bonds, primarily invested through investment funds and group insurance contracts. We develop our expected long-term rate of return assumptions based on the historical rates of returns for securities and instruments of the type in which our plans invest. The expected long-term rate of return on plan assets reflects the average rate of earnings expected on the invested assets and future assets to be invested to provide for the benefits included in the projected benefit obligation. We use historic plan asset returns combined with current market conditions to estimate the rate of return. The expected rate of return on plan assets is a long-term assumption based on an analysis of historical and forward looking returns considering the plan’s actual and target asset mix. The following table presents the fair values of the pension plan assets by asset category.
The plans do not invest in individual securities. All investments are through well diversified investment funds. As a result, there are no significant concentrations of risk within the plan assets. The following table reflects the benefits as of December 31, 2018 expected to be paid in each of the next five years and in the aggregate for the five years thereafter from our pension and other postretirement plans. Because our other postretirement plans are unfunded, the anticipated benefits with respect to these plans will come from our own assets. Because our pension plans are primarily funded plans, the anticipated benefits with respect to these plans will come primarily from the trusts established for these plans.
We anticipate contributing $6.3 million and $1.4 million to our pension and other postretirement plans, respectively, during 2019. The pre-tax amounts in accumulated other comprehensive loss that have not yet been recognized as components of net periodic benefit cost at December 31, 2018 and the changes in these amounts during the year ended December 31, 2018 are as follows.
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Comprehensive Income and Accumulated Other Comprehensive Income (Loss) | Comprehensive Income and Accumulated Other Comprehensive Income (Loss) The accumulated balances related to each component of other comprehensive income (loss), net of tax, are as follows:
The following table summarizes the effects of reclassifications from accumulated other comprehensive income (loss):
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Share-Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Compensation | Share-Based Compensation Compensation cost charged against income, primarily selling, general and administrative expense, and the income tax benefit recognized for our share-based compensation arrangements is included below:
We currently have outstanding stock appreciation rights (SARs), restricted stock units with service vesting conditions, restricted stock units with performance vesting conditions, and restricted stock units with market conditions. We grant SARs with an exercise price equal to the closing market price of our common stock on the grant date. Generally, SARs may be converted into shares of our common stock in equal amounts on each of the first three anniversaries of the grant date and expire 10 years from the grant date. Certain awards provide for accelerated vesting in certain circumstances, including following a change in control of the Company. Restricted stock units with service conditions generally vest 3-5 years from the grant date. Restricted stock units issued based on the attainment of the performance conditions generally vest on the second or third anniversary of their grant date. Restricted stock units issued based on the attainment of market conditions generally vest on the third anniversary of their grant date. We recognize compensation cost for all awards based on their fair values. The fair values for SARs are estimated on the grant date using the Black-Scholes-Merton option-pricing formula which incorporates the assumptions noted in the following table. Expected volatility is based on historical volatility, and expected term is based on historical exercise patterns of SAR holders. The fair value of restricted stock units with service vesting conditions or performance vesting conditions is the closing market price of our common stock on the date of grant. We estimate the fair value of certain restricted stock units with market conditions using a Monte Carlo simulation valuation model with the assistance of a third party valuation firm. Compensation costs for awards with service conditions are amortized to expense using the straight-line method. Compensation costs for awards with performance conditions and graded vesting are amortized to expense using the graded attribution method.
At December 31, 2018, the total unrecognized compensation cost related to all nonvested awards was $27.8 million. That cost is expected to be recognized over a weighted-average period of 2.1 years. Historically, we have issued treasury shares, if available, to satisfy award conversions and exercises. |
Preferred Stock |
12 Months Ended |
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Dec. 31, 2018 | |
Equity [Abstract] | |
Preferred Stock | Preferred Stock On July 26, 2016, we issued 5.2 million depositary shares, each of which represents 1/100th interest in a share of 6.75% Series B Mandatory Convertible Preferred Stock (the Preferred Stock), for an offering price of $100 per depositary share. Holders of the Preferred Stock may elect to convert their shares into common stock at any time prior to the mandatory conversion date. Unless earlier converted, each share of Preferred Stock will automatically convert into common stock on or around July 15, 2019 into between 120.46 and 132.50 shares of Belden common stock, subject to customary anti-dilution adjustments. This represents a range of 6.2 million to 6.9 million shares of Belden common stock to be issued upon conversion. The number of shares of Belden common stock issuable upon the mandatory conversion of the Preferred Stock will be determined based upon the volume-weighted average price of Belden’s common stock over the 20 day trading period beginning on, and including, the 22nd scheduled trading day prior to July 15, 2019. The net proceeds from this offering were approximately $501 million. The net proceeds are for general corporate purposes. With respect to dividend and liquidation rights, the Preferred Stock ranks senior to our common stock and junior to all of our existing and future indebtedness. |
Stockholder Rights Plan |
12 Months Ended |
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Dec. 31, 2018 | |
Equity [Abstract] | |
Stockholder Rights Plan | Stockholder Rights Plan On March 27, 2018, our Board of Directors authorized the redemption of all outstanding preferred share purchase rights issued pursuant to the then existing Rights Agreement. Under the former Rights Agreement, one right was attached to each outstanding share of common stock. The rights were redeemed at a redemption price of $0.01 per right, resulting in a total payment of $0.4 million to the holders of the rights as of the close of business on March 27, 2018. |
Share Repurchases |
12 Months Ended |
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Dec. 31, 2018 | |
Equity [Abstract] | |
Share Repurchases | Share Repurchases On May 25, 2017, our Board of Directors authorized a share repurchase program, which allowed us to purchase up to $200.0 million of our common stock through open market repurchases, negotiated transactions, or other means, in accordance with applicable securities laws and other restrictions. This program was funded with cash on hand and cash flows from operating activities. During 2018, we repurchased 2.7 million shares of our common stock under the program for an aggregate cost of $175.0 million and an average price per share of $64.94. During 2017, we repurchased 0.3 million shares of our common stock under the program for an aggregate cost of $25.0 million and an average price per share of $79.75. We have utilized all of the $200.0 million authorized under this share repurchase program. On November 29, 2018, our Board of Directors authorized a share repurchase program, which allows us to purchase up to $300.0 million of our common stock through open market repurchases, negotiated transactions, or other means, in accordance with applicable securities laws and other restrictions. During 2018, we did not repurchase any shares of our common stock under this program. |
Operating Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||
Operating Leases | Operating Leases Operating lease expense incurred primarily for manufacturing and office space, machinery, and equipment was $31.7 million, $38.6 million, and $40.3 million in 2018, 2017, and 2016, respectively. Minimum annual lease payments for noncancelable operating leases in effect at December 31, 2018 are as follows (in thousands):
Certain of our operating leases include step rent provisions and rent escalations. We include these step rent provisions and rent escalations in our minimum lease payments obligations and recognize them as a component of rental expense on a straight-line basis over the minimum lease term. |
Market Concentrations and Risks |
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Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Market Concentrations and Risks | Market Concentrations and Risks Concentrations of Credit We sell our products to many customers in several markets across multiple geographic areas. The ten largest customers, of which six are distributors, constitute in aggregate approximately 34%, 35%, and 33% of revenues in 2018, 2017, and 2016, respectively. Unconditional Commodity Purchase Obligations At December 31, 2018, we were committed to purchase approximately 1.8 million pounds of copper at an aggregate fixed cost of $5.0 million. At December 31, 2018, this fixed cost was $0.2 million more than the market cost that would be incurred on a spot purchase of the same amount of copper. The aggregate market cost was based on the current market price of copper obtained from the New York Mercantile Exchange. Labor Approximately 21% of our labor force is covered by collective bargaining agreements at various locations around the world. Approximately 15% of our labor force is covered by collective bargaining agreements that we expect to renegotiate during 2019. Fair Value of Financial Instruments Our financial instruments consist primarily of cash and cash equivalents, trade receivables, trade payables, and debt instruments. The carrying amounts of cash and cash equivalents, trade receivables, and trade payables at December 31, 2018 are considered representative of their respective fair values. The fair value of our senior subordinated notes at December 31, 2018 and 2017 was approximately $1,485.0 million and $1,619.3 million, respectively, based on quoted prices of the debt instruments in inactive markets (Level 2 valuation). This amount represents the fair values of our senior subordinated notes with a carrying value of $1,485.9 million and $1,584.2 million as of December 31, 2018 and 2017, respectively. |
Contingent Liabilities |
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Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingent Liabilities | Contingent Liabilities General Various claims are asserted against us in the ordinary course of business including those pertaining to income tax examinations, product liability, customer, employment, vendor, and patent matters. Based on facts currently available, management believes that the disposition of the claims that are pending or asserted will not have a materially adverse effect on our financial position, operating results, or cash flow. Letters of Credit, Guarantees and Bonds At December 31, 2018, we were party to unused standby letters of credit, bank guarantees, and surety bonds totaling $7.5 million, $3.9 million, and $2.4 million, respectively. These commitments are generally issued to secure obligations we have for a variety of commercial reasons, such as workers compensation self-insurance programs in several states and the importation and exportation of product. |
Supplemental Cash Flow Information |
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Supplemental Cash Flow Elements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Information | Supplemental Cash Flow Information Supplemental cash flow information is as follows:
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Quarterly Operating Results (Unaudited) |
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Operating Results (Unaudited) | Quarterly Operating Results (Unaudited)
Included in the first, second, third, and fourth quarters of 2018 are severance, restructuring, and integration costs of $20.4 million, $24.9 million, $11.7 million, and $11.6 million, respectively.
During the financial closing process for the fourth quarter of 2017, we determined that certain consolidated financial statement amounts were not recorded correctly in prior interim periods of 2017. We evaluated these errors and concluded that they were not material to any of our previously issued interim financial statements and did not require restatement of the quarters. The errors primarily related to recognizing revenue prior to satisfying all of the delivery criteria in one business within our Enterprise segment. The impact of the errors in the first, second, and third quarters of 2017 was an overstatement of revenues of $6.1 million, $10.4 million, and $11.8 million, respectively, and an overstatement of net income of $3.0 million, $1.3 million, and $2.6 million, respectively. The impact of the errors in the fourth quarter of 2017 was an understatement of revenues of $27.8 million and an understatement of net income of $5.2 million. All of the errors were corrected as of December 31, 2017. Included in the first, second, third, and fourth quarters of 2017 are severance, restructuring, and integration costs of $6.6 million, $9.6 million, $16.7 million, and $9.9 million, respectively. |
Subsequent Events |
12 Months Ended |
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Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events We signed a settlement agreement with the sellers ("Claimant") of SAM on January 30, 2019 for claims arising over the timing of the earnout consideration outlined in the purchase agreement. As part of the settlement, the parties agreed that the earnout consideration would be payable during the first quarter 2020, unless earlier payment is required as per the terms of the purchase agreement, and Belden would immediately pay the Claimant $0.9 million for interest and fees incurred, which we recognized in selling, general, and administrative expenses in our 2018 financial statements. |
Schedule II - Valuation and Qualifying Accounts |
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Valuation and Qualifying Accounts [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule II - Valuation and Qualifying Accounts | Schedule II – Valuation and Qualifying Accounts
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Basis of Presentation (Policies) |
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Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Description | Business Description Belden Inc. (the Company, us, we, or our) is a signal transmission solutions company built around two global business platforms – Enterprise Solutions and Industrial Solutions. Our comprehensive portfolio of signal transmission solutions provides industry leading secure and reliable transmission of data, sound, and video for mission critical applications. We sell our products to distributors, end-users, installers, and directly to original equipment manufacturers (OEMs). |
Consolidation | Consolidation The accompanying Consolidated Financial Statements include Belden Inc. and all of its subsidiaries, including variable interest entities for which we are the primary beneficiary. We eliminate all significant affiliate accounts and transactions in consolidation. |
Foreign Currency | Foreign Currency For international operations with functional currencies other than the United States (U.S.) dollar, we translate assets and liabilities at current exchange rates; we translate income and expenses using average exchange rates. We report the resulting translation adjustments, as well as gains and losses from certain affiliate transactions, in accumulated other comprehensive income (loss), a separate component of stockholders’ equity. We include exchange gains and losses on transactions in operating income. We determine the functional currency of our foreign subsidiaries based upon the currency of the primary economic environment in which each subsidiary operates. Typically, that is determined by the currency in which the subsidiary primarily generates and expends cash. We have concluded that the local currency is the functional currency for all of our material subsidiaries. |
Reporting Periods | Reporting Periods Our fiscal year and fiscal fourth quarter both end on December 31. Our fiscal first quarter ends on the Sunday falling closest to 91 days after December 31. Our fiscal second and third quarters each have 91 days. |
Use of Estimates in the Preparation of the Financial Statements | Use of Estimates in the Preparation of the Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, and operating results and the disclosure of contingencies. Actual results could differ from those estimates. We make significant estimates with respect to the collectability and valuation of receivables, the valuation of inventory, the realization of deferred tax assets, the valuation of goodwill and indefinite-lived intangible assets, the valuation of contingent liabilities, the calculation of share-based compensation, the calculation of pension and other postretirement benefits expense, and the valuation of acquired businesses. |
Reclassifications | Reclassifications We have made certain reclassifications to the 2017 and 2016 Condensed Consolidated Financial Statements, including those related to the adoption of Accounting Standards Update No. 2017-07, Compensation - Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (ASU 2017-07) and our segment change, with no impact to reported net income in order to conform to the 2018 presentation. See Note 5. |
Summary of Significant Accounting Policies Summary of Significant Accounting Policies (Policies) |
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Dec. 31, 2018 | |||||||||||||
Accounting Policies [Abstract] | |||||||||||||
Fair Value Measurement | Fair Value Measurement Accounting guidance for fair value measurements specifies a hierarchy of valuation techniques based upon whether the inputs to those valuation techniques reflect assumptions other market participants would use based upon market data obtained from independent sources or reflect our own assumptions of market participant valuation. The hierarchy is broken down into three levels based on the reliability of the inputs as follows:
During 2018, 2017, and 2016 we utilized Level 1 inputs to determine the fair value of cash equivalents, and Level 3 inputs to determine the fair value of net assets acquired in business combinations (see Note 4) and for our annual impairment testing (see Note 10). We did not have any transfers between Level 1 and Level 2 fair value measurements during 2018. |
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Cash and Cash Equivalents | Cash and Cash Equivalents We classify cash on hand and deposits in banks, including commercial paper, money market accounts, and other investments with an original maturity of three months or less, that we hold from time to time, as cash and cash equivalents. We periodically have cash equivalents consisting of short-term money market funds and other investments. As of December 31, 2018 and 2017, we did not have any such cash equivalents on hand. The primary objective of our investment activities is to preserve our capital for the purpose of funding operations. We do not enter into investments for trading or speculative purposes. |
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Accounts Receivable | Accounts Receivable We classify amounts owed to us and due within twelve months, arising from the sale of goods or services and from other business activities, as current receivables. We classify receivables due after twelve months as other long-lived assets. At the time of sale, we establish an estimated reserve for trade, promotion, and other special price reductions such as contract pricing, discounts to meet competitor pricing, and on-time payment discounts. We also adjust receivable balances for, among other things, correction of billing errors, incorrect shipments, and settlement of customer disputes. Customers are allowed to return inventory if and when certain conditions regarding the physical state of the inventory and our approval of the return are met. Certain distribution customers are allowed to return inventory at original cost, in an amount not to exceed three percent of the prior year’s purchases, in exchange for an order of equal or greater value. Until we can process these reductions, corrections, and returns (together, the Changes) through individual customer records, we estimate the amount of outstanding Changes and recognize them by reducing revenues and accounts receivable. We also adjust inventory and cost of sales for the estimated level of returns. We base these estimates on historical and anticipated sales demand, trends in product pricing, and historical and anticipated Changes patterns. We make revisions to these estimates in the period in which the facts that give rise to each revision become known. Future market conditions might require us to take actions to further reduce prices and increase customer return authorizations. Unprocessed Changes recognized against our gross accounts receivable balance at December 31, 2018 and 2017 totaled $25.7 million and $35.7 million, respectively. We evaluate the collectability of accounts receivable based on the specific identification method. A considerable amount of judgment is required in assessing the realizability of accounts receivable, including the current creditworthiness of each customer and related aging of the past due balances. We perform ongoing credit evaluations of our customers’ financial condition. Through these evaluations, we may become aware of a situation where a customer may not be able to meet its financial obligations due to deterioration of its financial viability, credit ratings, or bankruptcy. We record a specific reserve for bad debts against amounts due to reduce the receivable to its estimated collectible balance. |
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Inventories and Related Reserves | Inventories and Related Reserves Inventories are stated at the lower of cost or net realizable value. We determine the cost of all raw materials, work-in-process, and finished goods inventories by the first in, first out method. Cost components of inventories include direct labor, applicable production overhead, and amounts paid to suppliers of materials and products as well as freight costs and, when applicable, duty costs to import the materials and products. We evaluate the realizability of our inventory on a product-by-product basis in light of historical and anticipated sales demand, technological changes, product life cycle, component cost trends, product pricing, and inventory condition. In circumstances where inventory levels are in excess of anticipated market demand, where inventory is deemed technologically obsolete or not saleable due to condition, or where inventory cost exceeds net realizable value, we record a charge to cost of sales and reduce the inventory to its net realizable value. |
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Property, Plant and Equipment | Property, Plant and Equipment We record property, plant and equipment at cost. We calculate depreciation on a straight-line basis over the estimated useful lives of the related assets ranging from 10 to 40 years for buildings, 5 to 12 years for machinery and equipment, and 5 to 10 years for computer equipment and software. Construction in process reflects amounts incurred for the configuration and build-out of property, plant and equipment and for property, plant and equipment not yet placed into service. We charge maintenance and repairs—both planned major activities and less-costly, ongoing activities—to expense as incurred. We capitalize interest costs associated with the construction of capital assets and amortize the costs over the assets’ useful lives. Depreciation expense is included in costs of sales; selling, general and administrative expenses; and research and development expenses in the Consolidated Statements of Operations based on the specific categorization and use of the underlying assets being depreciated. We review property, plant and equipment to determine whether an event or change in circumstances indicates the carrying values of the assets may not be recoverable. We base our evaluation on the nature of the assets, the future economic benefit of the assets, and any historical or future profitability measurements, as well as other external market conditions or factors that may be present. If such impairment indicators are present or other factors exist that indicate that the carrying amount of an asset may not be recoverable, we determine whether impairment has occurred through the use of an undiscounted cash flow analysis. If impairment has occurred, we recognize a loss for the difference between the carrying amount and the fair value of the asset. For purposes of impairment testing of long-lived assets, we have identified asset groups at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Generally, our asset groups are based on an individual plant or operating facility level. In some circumstances, however, a combination of plants or operating facilities may be considered the asset group due to interdependence of operational activities and cash flows. |
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Goodwill and Intangible Assets | Goodwill and Intangible Assets Our intangible assets consist of (a) definite-lived assets subject to amortization such as developed technology, customer relationships, certain in-service research and development, certain trademarks, backlog, and capitalized software intangible assets, and (b) indefinite-lived assets not subject to amortization such as goodwill, certain trademarks, and certain in-process research and development intangible assets. We record amortization of the definite-lived intangible assets over the estimated useful lives of the related assets, which generally range from one year or less for backlog to more than 25 years for certain of our customer relationships. We determine the amortization method for our definite-lived intangible assets based on the pattern in which the economic benefits of the intangible asset are consumed. In the event we cannot reliably determine that pattern, we utilize a straight-line amortization method. We test our goodwill and other indefinite-lived intangible assets not subject to amortization for impairment on an annual basis as of our fiscal November month-end or when indicators of impairment exist. We base our estimates on assumptions we believe to be reasonable, but which are not predictable with precision and therefore are inherently uncertain. Actual future results could differ from these estimates. The accounting guidance related to goodwill impairment testing allows for the performance of an optional qualitative assessment of whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. Such an evaluation is made based on the weight of all available evidence and the significance of all identified events and circumstances that may influence the fair value of a reporting unit. If it is more likely than not that the fair value is less than the carrying value, then a quantitative assessment is required for the reporting unit, as described in the paragraph below. In 2018, we performed a qualitative assessment for seven of our reporting units, which collectively represented approximately $383.4 million of our consolidated goodwill balance. For those reporting units for which we performed a qualitative assessment, we determined that it was more likely than not that the fair value was greater than the carrying value, and therefore, we did not perform the calculation of fair value for these reporting units as described in the paragraph below. For our annual impairment test in 2018, we performed a quantitative assessment for four of our reporting units, which collectively represented approximately $1,174.3 million of our consolidated goodwill balance. Under a quantitative assessment for goodwill impairment, we determine the fair value using the income approach (using Level 3 inputs) as reconciled to our aggregate market capitalization. Under the income approach, we calculate the fair value of a reporting unit based on the present value of estimated future cash flows. If the fair value of the reporting unit exceeds the carrying value of the net assets including goodwill assigned to that unit, goodwill is not impaired. If the carrying value of the reporting unit’s net assets including goodwill exceeds the fair value of the reporting unit, then we record an impairment charge based on that difference. In addition to the income approach, we calculate the fair value of our reporting units under a market approach. The market approach measures the fair value of a reporting unit through analysis of financial multiples of comparable businesses. Consideration is given to the financial conditions and operating performance of the reporting unit being valued relative to those publicly-traded companies operating in the same or similar lines of business. The fair values of the four reporting units tested under a quantitative approach were in excess of the carrying values as of the impairment testing date. We did not recognize any goodwill impairment in 2018, 2017, or 2016. See Note 10 for further discussion. We also evaluate indefinite lived intangible assets for impairment annually or at other times if events have occurred or circumstances exist that indicate the carrying values of those assets may no longer be recoverable. We compare the fair value of the asset with its carrying amount. If the carrying amount of the asset exceeds its fair value, we recognize an impairment loss in an amount equal to that excess. We did not recognize impairment charges for our indefinite lived intangible assets in 2018, 2017, or 2016. See Note 10 for further discussion. We review intangible assets subject to amortization whenever an event or change in circumstances indicates the carrying values of the assets may not be recoverable. We test intangible assets subject to amortization for impairment and estimate their fair values using the same assumptions and techniques we employ on property, plant and equipment. We did not recognize any impairment charges for amortizable intangible assets in 2018, 2017, or 2016. |
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Disposals | Disposals During 2018, we sold a previously closed operating facility for net proceeds of $1.5 million and recognized a $0.6 million gain on the sale. During the fourth quarter of 2016, we committed to a plan to sell our MCS business and 50% ownership interest in Xuzhou Hirschmann Electronics Co. Ltd (the Hirschmann JV) and determined that we met all of the criteria to classify the assets and liabilities of these businesses as held for sale. The MCS business was part of the Industrial Solutions segment and the Hirschmann JV was an equity method investment that was not included in an operating segment. The MCS business operated in Germany and the United States, and the Hirschmann JV was an equity method investment located in China. During 2016, we reached an agreement in principle to sell this disposal group for a total sales price of $39 million plus a working capital adjustment. As the carrying value of the disposal group exceeded the fair value less costs to sell, which we determined based on the expected sales price, by $23.9 million, we recognized an impairment charge equal to this amount in 2016. In 2017, we sold the MCS business and Hirschmann JV for a total purchase price of $40.2 million and recognized a loss on sale of the assets of $1.0 million, which was included in selling, general and administrative expenses. This loss included $2.8 million of accumulated other comprehensive losses that were recognized as a result of the sale. We collected the $40.2 million proceeds from the sale during 2018. |
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Pension and Other Postretirement Benefits | Pension and Other Postretirement Benefits Our pension and other postretirement benefit costs and obligations are dependent on the various actuarial assumptions used in calculating such amounts. These assumptions relate to discount rates, salary growth, long-term return on plan assets, health care cost trend rates, mortality tables, and other factors. We base the discount rate assumptions on current investment yields on high-quality corporate long-term bonds. The salary growth assumptions reflect our long-term actual experience and future or near-term outlook. We determine the long-term return on plan assets based on historical portfolio results and management’s expectation of the future economic environment. Our health care cost trend assumptions are developed based on historical cost data, the near-term outlook, and an assessment of likely long-term trends. Actual results that differ from our assumptions are accumulated and, if in excess of the lesser of 10% of the projected benefit obligation or the fair market value of plan assets, are amortized over the estimated future working life of the plan participants. |
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Accrued Sales Rebates | Accrued Sales Rebates We grant incentive rebates to participating customers as part of our sales programs. The rebates are determined based on certain targeted sales volumes. Rebates are paid quarterly or annually in either cash or receivables credits. Until we can process these rebates through individual customer records, we estimate the amount of outstanding rebates and recognize them as accrued liabilities and reductions in our gross revenues. We base our estimates on both historical and anticipated sales demand and rebate program participation. We charge revisions to these estimates back to accrued liabilities and revenues in the period in which the facts that give rise to each revision become known. Future market conditions and product transitions might require us to take actions to increase sales rebates offered, possibly resulting in an incremental increase in accrued liabilities and an incremental reduction in revenues at the time the rebate is offered. |
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Contingent Liabilities | Contingent Liabilities We have established liabilities for environmental and legal contingencies that are probable of occurrence and reasonably estimable, the amounts of which are currently not material. A significant amount of judgment and use of estimates is required to quantify our ultimate exposure in these matters. We review the valuation of these liabilities on a quarterly basis, and we adjust the balances to account for changes in circumstances for ongoing and emerging issues. We accrue environmental remediation costs based on estimates of known environmental remediation exposures developed in consultation with our environmental consultants and legal counsel, the amounts of which are not currently material. We expense environmental compliance costs, which include maintenance and operating costs with respect to ongoing monitoring programs, as incurred. We evaluate the range of potential costs to remediate environmental sites. The ultimate cost of site clean-up is difficult to predict given the uncertainties of our involvement in certain sites, uncertainties regarding the extent of the required clean-up, the availability of alternative clean-up methods, variations in the interpretation of applicable laws and regulations, the possibility of insurance recoveries with respect to certain sites, and other factors. We are, from time to time, subject to routine litigation incidental to our business. These lawsuits primarily involve claims for damages arising out of the use of our products, allegations of patent or trademark infringement, and litigation and administrative proceedings involving employment matters and commercial disputes. Assessments regarding the ultimate cost of lawsuits require judgments concerning matters such as the anticipated outcome of negotiations, the number and cost of pending and future claims, and the impact of evidentiary requirements. Based on facts currently available, we believe the disposition of the claims that are pending or asserted will not have a materially adverse effect on our financial position, results of operations or cash flow. |
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Business Combination Accounting | Business Combination Accounting We allocate the consideration of an acquired business to its identifiable assets and liabilities based on estimated fair values. The excess of the consideration over the amount allocated to the assets and liabilities, if any, is recorded to goodwill. We use all available information to estimate fair values. We typically engage third party valuation specialists to assist in the fair value determination of inventories, tangible long-lived assets, and intangible assets other than goodwill. The carrying values of acquired receivables and accounts payable have historically approximated their fair values as of the business combination date. As necessary, we may engage third party specialists to assist in the estimation of fair value for certain liabilities, such as deferred revenue or postretirement benefit liabilities. We adjust the preliminary acquisition accounting, as necessary, typically up to one year after the acquisition closing date as we obtain more information regarding asset valuations and liabilities assumed. |
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Revenue Recognition | Revenue Recognition We recognize revenue consistent with the principles as outlined in the following five step model: (1) identify the contract with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) each performance obligation is satisfied. See Note 3. |
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Cost of Sales | Cost of Sales Cost of sales includes our total cost of inventory sold during the period, including material, labor, production overhead costs, variable manufacturing costs, and fixed manufacturing costs. Production overhead costs include operating supplies, applicable utility expenses, maintenance costs, and scrap. Variable manufacturing costs include inbound, interplant, and outbound freight, inventory shrinkage, and charges for excess and obsolete inventory. Fixed manufacturing costs include the costs associated with our purchasing, receiving, inspection, warehousing, distribution centers, production and inventory control, and manufacturing management. Cost of sales also includes the costs to provide maintenance and support and other professional services. |
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Shipping and Handling Costs | Shipping and Handling Costs We recognize fees earned on the shipment of product to customers as revenues and recognize costs incurred on the shipment of product to customers as a cost of sales. |
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Selling, General and Administrative Expenses | Selling, General and Administrative Expenses Selling, general and administrative expenses include expenses not directly related to the production of inventory. They include all expenses related to selling and marketing our products, as well as the salary and benefit costs of associates performing the selling and marketing functions. Selling, general and administrative expenses also include salary and benefit costs, purchased services, and other costs related to our executive and administrative functions. |
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Research and Development Costs | Research and Development Costs Research and development costs are expensed as incurred. |
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Advertising Costs | Advertising Costs Advertising costs are expensed as incurred |
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Share-Based Compensation | Share-Based Compensation We compensate certain employees and non-employee directors with various forms of share-based payment awards and recognize compensation costs for these awards based on their fair values. We estimate the fair values of certain awards, primarily stock appreciation rights (SARs), on the grant date using the Black-Scholes-Merton option-pricing formula, which incorporates certain assumptions regarding the expected term of an award and expected stock price volatility. We develop the expected term assumption based on the vesting period and contractual term of an award, our historical exercise and cancellation experience, our stock price history, plan provisions that require exercise or cancellation of awards after employees terminate, and the extent to which currently available information indicates that the future is reasonably expected to differ from past experience. We develop the expected volatility assumption based on historical price data for our common stock. We estimate the fair value of certain restricted stock units with service vesting conditions and performance vesting conditions based on the grant date stock price. We estimate the fair value of certain restricted stock units with market conditions using a Monte Carlo simulation valuation model with the assistance of a third party valuation firm. After calculating the aggregate fair value of an award, we use an estimated forfeiture rate to discount the amount of share-based compensation cost expected to be recognized in our operating results over the service period of the award. We develop the forfeiture assumption based on our historical pre-vesting cancellation experience. |
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Income Taxes | Income Taxes Income taxes are provided based on earnings reported for financial statement purposes. The provision for income taxes differs from the amounts currently payable to taxing authorities because of the recognition of revenues and expenses in different periods for income tax purposes than for financial statement purposes. Income taxes are provided as if operations in all countries, including the U.S., were stand-alone businesses filing separate tax returns. We recognize deferred tax assets resulting from tax credit carryforwards, net operating loss carryforwards, and deductible temporary differences between taxable income on our income tax returns and pretax income on our financial statements. Deferred tax assets generally represent future tax benefits to be received when these carryforwards can be applied against future taxable income or when expenses previously reported in our Consolidated Financial Statements become deductible for income tax purposes. A deferred tax asset valuation allowance is required when some portion or all of the deferred tax assets may not be realized. At December 31, 2018 the valuation allowance of $90.9 million was primarily related to net operating losses and foreign tax credits that we are not expected to realize. Our effective tax rate is based on expected income, statutory tax rates, and tax planning opportunities available to us in the various jurisdictions in which we operate. Significant judgment is required in determining our effective tax rate and in evaluating our tax positions. We establish accruals for uncertain tax positions when we believe that the full amount of the associated tax benefit may not be realized. To the extent we were to prevail in matters for which accruals have been established or would be required to pay amounts in excess of reserves, there could be a material effect on our income tax provisions in the period in which such determination is made. On December 22, 2017, the “Tax Cuts and Jobs Act” (the “Act”) was signed into law, making significant changes to the U.S. Internal Revenue Code. Changes include, but are not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning after December 31, 2017, the transition of U.S. international taxation from a worldwide tax system to a territorial tax system, and a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017. In accordance with the Act, we recorded $28.4 million as additional income tax expense in the fourth quarter of 2017, the period in which the legislation was enacted. The total income tax expense included a $36.0 million tax benefit for the remeasurement of deferred tax assets and liabilities to the 21% rate at which they are expected to reverse, offset with a one-time tax expense on deemed repatriation of $29.1 million and a valuation allowance of $35.3 million recorded against foreign tax credit carryovers that we no longer expect to be able to realize based upon the new tax law. Additionally, Staff Accounting Bulletin No. 118 (“SAB 118”) was issued to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Act. December 22, 2018 marked the end of the measurement period for purposes of SAB 118. As such, we have completed our analysis based on legislative updates relating to the Act currently available which resulted in an additional SAB 118 tax expense of $10.0 million for the year ended December 31, 2018. The total tax expense included an $8.0 million tax expense associated with an increase to the valuation allowance against foreign tax credit carryovers that we no longer expect to be able to realize based upon the new tax law, a $1.3 million tax expense adjustment to the transition tax on the deemed repatriation of cumulative foreign earnings, a $1.1 million tax expense resulting from a valuation allowance established on the deferred tax assets associated with stock options of covered employees, and a $0.4 million income tax benefit associated with an adjustment to the remeasurement of certain deferred tax assets and liabilities. See Note 15, Income Taxes, in the accompanying notes to our consolidated financial statements. |
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Recent Accounting Pronouncements | Current-Year Adoption of Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09), which replaced most existing revenue recognition guidance in U.S. GAAP. The core principle of the ASU is that an entity should recognize revenue for the transfer of goods or services equal to the amount that it expects to be entitled to receive for those goods or services. ASU 2014-09 requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. We adopted ASU 2014-09 on January 1, 2018, using the modified retrospective method of adoption. Adoption resulted in a $2.6 million, net of tax increase to retained earnings. This adjustment primarily relates to the deferral of costs to obtain a contract that were previously expensed at the beginning of the contract period. In August 2016, the FASB issued Accounting Standards Update No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15). The new guidance addresses how the following eight specific cash flow items are to be presented: Debt prepayment or debt extinguishment costs; settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; contingent consideration payments made after a business combination; proceeds from the settlement of insurance claims; proceeds from the settlement of corporate-owned life insurance policies (including bank-owned life insurance policies); distributions received from equity method investees; beneficial interests in securitization transactions; and separately identifiable cash flows and application of the predominance principle. We adopted ASU 2016-15 on January 1, 2018. The adoption had no material impact on our statement of cash flows for the year ended December 31, 2018. In October 2016, the FASB issued Accounting Standards Update No. 2016-16, Intra-Entity Transfers of Assets Other Than Inventory (ASU 2016-16), which requires recognition of the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. Consequently, the standard eliminates the exception to the recognition of current and deferred income taxes for an intra-entity asset transfer other than for inventory until the asset has been sold to an outside party. We adopted ASU 2016-16 on January 1, 2018. The adoption resulted in a $3.0 million and $46.9 million decrease to other current assets and other long-lived assets, respectively, as well as an $18.2 million increase in deferred income tax assets and a $31.7 million decrease to retained earnings on January 1, 2018. The adoption had no material impact on our results of operations. In March 2017, the FASB issued ASU 2017-07, which requires an entity to report the service cost component in the same line item or items as other compensation costs arising from the service rendered by their employees during the period. The other components of net benefit cost are required to be presented in the Statement of Operations separately from the service cost component after Operating Income. Additionally, only the service cost component is eligible for capitalization, when applicable. The standard requires the amendments to be applied retrospectively for the presentation of the service cost component and the other cost components of net periodic pension cost and net periodic OPEB cost in the Statement of Operations and prospectively, on and after the effective date, for the capitalization of the service cost component of net periodic pension and OPEB costs. We adopted ASU 2017-07 on January 1, 2018, and elected to use the practical expedient related to the retrospective presentation requirements. Adoption resulted in a $0.7 million and $8.2 million increase to operating income for the years ended December 31, 2017 and 2016, respectively, but no changes to net income. In January 2018, the FASB released guidance on the accounting for tax on the global intangible low-taxed income (“GILTI”) provisions of the Tax Cuts and Jobs Act (the “Act”). The GILTI provisions impose a tax on foreign income in excess of a deemed return on tangible assets of foreign corporations. In the fourth quarter of 2018, the Company elected to treat any potential GILTI inclusions as a period cost. In August 2018, the FASB issued ASU No. 2018-14 (“ASU 2018-14”), Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans. The amendments in ASU 2018-14 remove certain disclosures, clarify the specific requirements of disclosures, and add new disclosure requirements, including (1) the weighted-average interest crediting rates for cash balance plans and other plans with promised interest crediting rates and (2) an explanation of the reasons for significant gains and losses related to changes in the benefit obligation for the period. The amendments are effective for fiscal years ending after December 15, 2020, and early adoption is permitted. We early adopted ASU 2018-14 in 2018. The adoption had no impact on our financial statements; only our disclosures. See Note 16. Pending Adoption of Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (ASU 2016-02), a leasing standard for both lessees and lessors that supersedes the lease requirements in Accounting Standards Codification (ASC) Topic 840, "Leases." Under its core principle, a lessee will recognize a right-of-use asset and lease liability on the balance sheet for nearly all leased assets. Lessor accounting remains largely consistent with existing U.S. generally accepted accounting principles. We plan to adopt ASU 2016-02 on January 1, 2019 using the newly permitted transition method issued in July 2018, under ASU No. 2018-11 (“ASU 2018-11”), Leases: Targeted Improvements, which provides an additional (and optional) transition method for adopting the new lease standard. Under this transition method, an entity initially applies the new lease standard at the adoption date and recognizes a cumulative effect adjustment to opening retained earnings in the period of adoption. Furthermore, we plan to elect the following practical expedients and accounting policy elections upon adoption: (i) the package of practical expedients as defined in ASU 2016-02, (ii) the short-term lease accounting policy election, (iii) the practical expedient to not separate non-lease components from lease components, and (iv) the easement practical expedient, which permits an entity to continue applying its current policy for accounting for land easements that existed as of the effective date of ASU 2016-02. We are implementing changes to our systems and processes in response to the new standard. We expect the adoption will result in an increase to our total assets and liabilities on our consolidated balance sheet between $68 million and $78 million, before considering deferred taxes. The adoption is not expected to have a material impact on our results of operations. In August 2017, the FASB issued Accounting Standards Update No. ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. The new guidance better aligns an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The new guidance also makes certain targeted improvements to simplify the application of hedge accounting guidance and ease the administrative burden of hedge documentation requirements and assessing hedge effectiveness. The standard is effective for fiscal years beginning after December 15, 2018, and early adoption is permitted. We do not expect the standard to have a material impact on our consolidated financial statements and related disclosures. In February 2018, the FASB issued ASU No. 2018-02 (“ASU 2018-02”), Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. ASU 2018-02 provides an option to allow reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017. The new guidance is effective for annual and interim periods beginning after December 15, 2018, and early adoption is permitted. We are currently evaluating the impact this update will have on our condensed consolidated financial statements and related disclosures. In June 2018, the FASB issued ASU No. 2018-07 (“ASU 2018-07”), Improvements to Nonemployee Share-Based Payment Accounting. The amendments in ASU 2018-07 expand the scope of Topic 718, Compensation - Stock Compensation, to include share-based payment transactions for acquiring goods and services from non-employees, and provide that non-employee share-based payment awards be measured at their grant-date fair value and the probability of satisfying performance conditions be taken into account when non-employee share-based payment awards contain such conditions. The standard is effective for fiscal years beginning after December 15, 2018, and early adoption is permitted. We are currently evaluating the impact this update will have on our condensed consolidated financial statements and related disclosures. In August 2018, the Securities and Exchange Commission (“SEC”) adopted the final rule under SEC Release No. 33-10532, Disclosure Update and Simplification, amending certain disclosure requirements that were redundant, duplicative, overlapping, outdated or superseded. Additionally, the amendments expanded the disclosure requirements on the analysis of stockholders' equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders' equity presented in the balance sheet must be provided in a note or separate statement. The analysis should present a reconciliation of the beginning balance to the ending balance of each period presented. The amendments were effective on November 5, 2018, however, the SEC staff recently clarified in a Compliance and Disclosure Interpretation (C&DI) that it would not object if a registrant waits until it files Form 10-Q for the quarter that begins after the effective date to comply with the new requirements pertaining to the equity reconciliation but can adopt the other amendments upon effectiveness. We are in the process of evaluating the impact of the final rule on its consolidated financial statements. |
Revenues (Tables) |
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue | The following tables present our revenues disaggregated by major product category.
The following tables present our revenues disaggregated by geography, based on the location of the customer purchasing the product.
The following tables present our revenues disaggregated by products, including software products, and support and services.
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Acquisitions (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the estimated, preliminary fair value of the assets acquired and the liabilities assumed as of February 8, 2018 (in thousands):
The following table summarizes the estimated fair values of the assets acquired and the liabilities assumed as of May 31, 2017 (in thousands):
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Schedule of Acquired Intangible Assets | The intangible assets related to the acquisition consisted of the following:
The intangible assets related to the acquisition consisted of the following:
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Schedule of Pro Forma Information | The following table illustrates the unaudited pro forma effect on operating results as if the Thinklogical acquisition had been completed as of January 1, 2016.
The following table illustrates the unaudited pro forma effect on operating results as if the SAM acquisition had been completed as of January 1, 2017.
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Operating Segments and Geographic Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating Segment Information | Operating Segment Information
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Reconciliation of Total Reportable Segments' Revenues and EBITDA to Consolidated Revenues and Consolidated Income Before Taxes | The following table is a reconciliation of the total of the reportable segments’ Revenues and EBITDA to consolidated revenues and consolidated income before taxes, respectively.
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Reconciliations of Other Segment Measures to Consolidated Totals | Below are reconciliations of other segment measures to the consolidated totals.
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Schedule of Revenue from External Customers and Long-Lived Assets Based on Physical Location | The table below summarizes net sales and long-lived assets for the years ended December 31, 2018, 2017 and 2016 for the following countries: the U.S., Canada, China, and Germany. No other individual foreign country’s net sales or long-lived assets are material to the Company.
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Income Per Share (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis for Income Per Share Computations | The following table presents the basis of the income per share computation:
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Inventories (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Major Classes of Inventories | The major classes of inventories were as follows:
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Property, Plant and Equipment (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Carrying Values of Property, Plant and Equipment | The carrying values of property, plant and equipment were as follows:
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Intangible Assets (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Carrying Value of Intangible Assets | The carrying values of intangible assets were as follows:
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Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill assigned to reporting units in our reportable segments are as follows:
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Changes in Carrying Amount of Trademarks | The changes in the carrying amount of indefinite-lived trademarks are as follows:
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Accrued Liabilities (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Liabilities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Carrying Value of Accrued Liabilities | The carrying values of accrued liabilities were as follows:
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Severance, Restructuring, and Acquisition Integration Activities (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Severance, Restructuring and Integration Costs by Segment | The following tables summarize the costs by segment of the various programs described above as well as other immaterial programs and acquisition integration activities:
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Long-Term Debt and Other Borrowing Arrangements (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Carrying Values of Long-Term Debt and Other Borrowing Arrangements | The carrying values of our long-term debt and other borrowing arrangements were as follows:
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Schedule of Senior Subordinated Notes | The senior subordinated notes due 2025, 2026, 2027 and 2028 are redeemable after September 15, 2020, October 15, 2021, July 15, 2022, and March 15, 2023, respectively, at the following redemption prices as a percentage of the face amount of the notes:
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Maturities on Outstanding Long-Term Debt and Other Borrowings | Maturities on outstanding long-term debt and other borrowings during each of the five years subsequent to December 31, 2018 are as follows (in thousands):
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Income Taxes (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Income Tax Expense |
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Effective Income Tax Rate Reconciliation from Continuing Operations |
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Components of Deferred Income Tax Balances |
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Summary of Net Operating Loss Carryforwards | The following tables summarize our net operating loss carryforwards and tax credit carryforwards as of December 31, 2018 by jurisdiction:
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Summary of Tax Credit Carryforwards |
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Reconciliation of Beginning and Ending Amounts of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:
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Pension and Other Postretirement Benefits (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Change in Benefit Obligation | The following tables provide a reconciliation of the changes in the plans’ benefit obligations and fair value of assets as well as a statement of the funded status and balance sheet reporting for these plans.
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Change in Plan Assets |
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Amounts Recognized in Balance Sheets |
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Components of Net Periodic Benefit Costs | The following table provides the components of net periodic benefit costs for the plans.
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Assumptions Used in Determining Benefit Obligations and Net Periodic Benefit Cost Amounts | The following table presents the assumptions used in determining the benefit obligations and the net periodic benefit cost amounts.
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Fair Values of Pension Plan Assets by Asset Category | The following table presents the fair values of the pension plan assets by asset category.
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Benefits Expected to be Paid in Subsequent Years from Our Pension and Other Postretirement as Well as Medicare Subsidy Receipts | The following table reflects the benefits as of December 31, 2018 expected to be paid in each of the next five years and in the aggregate for the five years thereafter from our pension and other postretirement plans. Because our other postretirement plans are unfunded, the anticipated benefits with respect to these plans will come from our own assets. Because our pension plans are primarily funded plans, the anticipated benefits with respect to these plans will come primarily from the trusts established for these plans.
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Summary of Accumulated Other Comprehensive Loss and Changes in these Amounts | The pre-tax amounts in accumulated other comprehensive loss that have not yet been recognized as components of net periodic benefit cost at December 31, 2018 and the changes in these amounts during the year ended December 31, 2018 are as follows.
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Comprehensive Income and Accumulated Other Comprehensive Income (Loss) (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Other Comprehensive Income (Loss), Net of Tax | The accumulated balances related to each component of other comprehensive income (loss), net of tax, are as follows:
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Summary of Effects of Reclassifications from Accumulated Other Comprehensive Income (Loss) | The following table summarizes the effects of reclassifications from accumulated other comprehensive income (loss):
|
Share-Based Compensation (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Benefit Recognized for our Share-Based Compensation Arrangements | Compensation cost charged against income, primarily selling, general and administrative expense, and the income tax benefit recognized for our share-based compensation arrangements is included below:
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Fair Values for SARs and Stock Options Estimated on Grant Date Using Black-Scholes-Merton Option-Pricing Formula Which Incorporates Assumptions | We recognize compensation cost for all awards based on their fair values. The fair values for SARs are estimated on the grant date using the Black-Scholes-Merton option-pricing formula which incorporates the assumptions noted in the following table. Expected volatility is based on historical volatility, and expected term is based on historical exercise patterns of SAR holders. The fair value of restricted stock units with service vesting conditions or performance vesting conditions is the closing market price of our common stock on the date of grant. We estimate the fair value of certain restricted stock units with market conditions using a Monte Carlo simulation valuation model with the assistance of a third party valuation firm. Compensation costs for awards with service conditions are amortized to expense using the straight-line method. Compensation costs for awards with performance conditions and graded vesting are amortized to expense using the graded attribution method.
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Summary of Share Based Compensation Activity |
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Operating Leases (Tables) |
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||
Summary of Minimum Annual Lease Payments for Noncancelable Operating Leases | Minimum annual lease payments for noncancelable operating leases in effect at December 31, 2018 are as follows (in thousands):
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Supplemental Cash Flow Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Elements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Information | Supplemental cash flow information is as follows:
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Quarterly Operating Results (Unaudited) (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Operating Results (Unaudited) |
Included in the first, second, third, and fourth quarters of 2018 are severance, restructuring, and integration costs of $20.4 million, $24.9 million, $11.7 million, and $11.6 million, respectively.
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Basis of Presentation - Additional Information (Details) |
12 Months Ended |
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Dec. 31, 2018
Segment
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reportable segments | 2 |
Acquisitions - Schedule of Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
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Snell Advanced Media | |||
Business Acquisition [Line Items] | |||
Revenues | $ 2,598,741 | $ 2,500,779 | |
Net income attributable to Belden common stockholders | $ 168,819 | $ (8,581) | |
Diluted income per share attributable to Belden common stockholders | $ 4.12 | $ (0.20) | |
Thinklogical Holdings LLC | |||
Business Acquisition [Line Items] | |||
Revenues | $ 2,399,715 | $ 2,407,830 | |
Net income attributable to Belden common stockholders | $ 60,690 | $ 113,014 | |
Diluted income per share attributable to Belden common stockholders | $ 1.42 | $ 2.66 |
Operating Segments and Geographic Information - Additional Information (Details) $ in Millions |
12 Months Ended | ||
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Dec. 31, 2018
USD ($)
Segment
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Dec. 31, 2017
USD ($)
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Dec. 31, 2016
USD ($)
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Segment Reporting Information [Line Items] | |||
Number of reportable segments | Segment | 2 | ||
Anixter International Inc. | |||
Segment Reporting Information [Line Items] | |||
Revenues generated from sales | $ 309.0 | $ 292.2 | $ 286.2 |
Accounts receivable outstanding | $ 37.0 | ||
Anixter International Inc. | Customer Concentration Risk | |||
Segment Reporting Information [Line Items] | |||
Percentage of total accounts receivable outstanding | 8.00% | ||
Anixter International Inc. | Customer Concentration Risk | Revenues | |||
Segment Reporting Information [Line Items] | |||
Percent of total revenues | 12.00% | 12.00% | 12.00% |
Operating Segments and Geographic Information - Schedule of Revenue from External Customers and Long-Lived Assets Based on Physical Location (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
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Dec. 31, 2018 |
Sep. 30, 2018 |
Jul. 01, 2018 |
Apr. 01, 2018 |
Dec. 31, 2017 |
Oct. 01, 2017 |
Jul. 02, 2017 |
Apr. 02, 2017 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
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Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Percent of total revenues | 100.00% | 100.00% | 100.00% | ||||||||
Long-lived assets | $ 395,833 | $ 402,529 | $ 395,833 | $ 402,529 | $ 348,068 | ||||||
Total Segment Revenues | 655,390 | $ 655,774 | $ 668,639 | $ 605,565 | 604,884 | $ 621,745 | $ 610,633 | $ 551,381 | $ 2,585,368 | $ 2,388,643 | $ 2,356,672 |
United States | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Percent of total revenues | 51.00% | 53.00% | 55.00% | ||||||||
Long-lived assets | 189,211 | 231,938 | $ 189,211 | $ 231,938 | $ 193,263 | ||||||
Total Segment Revenues | $ 1,324,653 | $ 1,265,455 | $ 1,283,925 | ||||||||
Canada | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Percent of total revenues | 7.00% | 7.00% | 7.00% | ||||||||
Long-lived assets | 32,312 | 33,806 | $ 32,312 | $ 33,806 | $ 31,278 | ||||||
Total Segment Revenues | $ 174,727 | $ 167,605 | $ 159,985 | ||||||||
China | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Percent of total revenues | 5.00% | 5.00% | 5.00% | ||||||||
Long-lived assets | 37,227 | 34,774 | $ 37,227 | $ 34,774 | $ 30,487 | ||||||
Total Segment Revenues | $ 132,544 | $ 121,600 | $ 114,605 | ||||||||
Germany | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Percent of total revenues | 5.00% | 5.00% | 4.00% | ||||||||
Long-lived assets | 39,870 | 38,029 | $ 39,870 | $ 38,029 | $ 32,386 | ||||||
Total Segment Revenues | $ 117,598 | $ 113,990 | $ 104,214 | ||||||||
Other | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Percent of total revenues | 32.00% | 30.00% | 29.00% | ||||||||
Long-lived assets | $ 97,213 | $ 63,982 | $ 97,213 | $ 63,982 | $ 60,654 | ||||||
Total Segment Revenues | $ 835,846 | $ 719,993 | $ 693,943 |
Noncontrolling Interest - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2018 |
Dec. 31, 2015 |
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Variable Interest Entity, primary beneficiary Belden | ||
Noncontrolling Interest [Line Items] | ||
Additional contribution commitments to joint venture | $ 1,530 | |
Hite | ||
Noncontrolling Interest [Line Items] | ||
Additional contribution commitments to joint venture | $ 1,470 | |
Hite | Variable Interest Entity, primary beneficiary Belden | ||
Noncontrolling Interest [Line Items] | ||
Variable interest entity, ownership percentage | 51.00% |
Income Per Share - Basis for Income Per Share Computations (Details) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
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Dec. 31, 2018 |
Sep. 30, 2018 |
Jul. 01, 2018 |
Apr. 01, 2018 |
Dec. 31, 2017 |
Oct. 01, 2017 |
Jul. 02, 2017 |
Apr. 02, 2017 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
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Numerator: | |||||||||||
Net income | $ 43,491 | $ 85,858 | $ 28,792 | $ 2,570 | $ 30,436 | $ 945 | $ 35,891 | $ 25,581 | $ 160,711 | $ 92,853 | $ 127,646 |
Less: Net loss attributable to noncontrolling interest | (35) | (23) | (77) | (48) | (83) | (82) | (86) | (106) | (183) | (357) | (357) |
Less: Preferred stock dividends | 8,733 | 8,732 | 8,733 | 8,733 | 8,733 | 8,732 | 8,733 | 8,733 | 34,931 | 34,931 | 15,428 |
Net income attributable to Belden common stockholders | $ 34,793 | $ 77,149 | $ 20,136 | $ (6,115) | $ 21,786 | $ (7,705) | $ 27,244 | $ 16,954 | $ 125,963 | $ 58,279 | $ 112,575 |
Denominator: | |||||||||||
Weighted average shares outstanding, basic (in shares) | 40,675 | 42,220 | 42,093 | ||||||||
Effect of dilutive common stock equivalents (in shares) | 281 | 423 | 464 | ||||||||
Weighted average shares outstanding, diluted (in shares) | 40,956 | 42,643 | 42,557 |
Income Per Share - Additional Information (Details) - shares shares in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
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Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive shares excluded from diluted weighted average shares outstanding (in shares) | 0.9 | 0.5 | 0.6 |
Anti-dilutive shares excluded form diluted weighted average shares outstanding due to performance conditions not met (in shares) | 0.3 | 0.2 | 0.1 |
Convertible Preferred Stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive shares excluded from diluted weighted average shares outstanding (in shares) | 6.9 | 6.9 | 3.0 |
Inventories - Major Classes of Inventories (Details) - USD ($) $ in Thousands |
Dec. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Raw materials | $ 146,803 | $ 133,311 |
Work-in-process | 45,939 | 35,807 |
Finished goods | 152,572 | 153,377 |
Gross inventories | 345,314 | 322,495 |
Excess and obsolete reserves | (28,896) | (25,269) |
Net inventories | $ 316,418 | $ 297,226 |
Property, Plant and Equipment - Summary of Carrying Values of Property, Plant and Equipment (Details) - USD ($) $ in Thousands |
Dec. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Gross property, plant and equipment | $ 944,459 | $ 907,562 |
Accumulated depreciation | (578,489) | (570,240) |
Net property, plant and equipment | 365,970 | 337,322 |
Land and land improvements | ||
Property, Plant and Equipment [Line Items] | ||
Gross property, plant and equipment | 30,173 | 31,963 |
Buildings and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Gross property, plant and equipment | 141,009 | 148,598 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Gross property, plant and equipment | 569,359 | 543,594 |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Gross property, plant and equipment | 139,773 | 136,509 |
Construction in process | ||
Property, Plant and Equipment [Line Items] | ||
Gross property, plant and equipment | $ 64,145 | $ 46,898 |
Property, Plant and Equipment - Additional Information (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
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Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 47.6 | $ 45.6 | $ 47.2 |
Intangible Assets - Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Goodwill [Roll Forward] | ||
Goodwill, Beginning Balance | $ 1,478,257 | $ 1,385,995 |
Acquisitions and purchase accounting adjustments | 105,899 | 71,394 |
Translation impact | (26,503) | 20,868 |
Goodwill, Ending Balance | 1,557,653 | 1,478,257 |
Enterprise Solutions | ||
Goodwill [Roll Forward] | ||
Goodwill, Beginning Balance | 702,271 | 617,320 |
Acquisitions and purchase accounting adjustments | 105,899 | 71,394 |
Translation impact | (22,812) | 13,557 |
Goodwill, Ending Balance | 785,358 | 702,271 |
Industrial Solutions | ||
Goodwill [Roll Forward] | ||
Goodwill, Beginning Balance | 775,986 | 768,675 |
Acquisitions and purchase accounting adjustments | 0 | 0 |
Translation impact | (3,691) | 7,311 |
Goodwill, Ending Balance | $ 772,295 | $ 775,986 |
Intangible Assets - Changes in Carrying Amount of Trademarks (Details) - Trademarks - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
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Indefinite-lived Intangible Assets [Roll Forward] | ||
Trademarks, Beginning Balance | $ 92,758 | $ 121,972 |
Translation impact | (2,367) | 3,987 |
Reclassify to definite-lived | (33,201) | |
Trademarks, Ending Balance | 90,391 | 92,758 |
Enterprise Solutions | ||
Indefinite-lived Intangible Assets [Roll Forward] | ||
Trademarks, Beginning Balance | 83,077 | 80,350 |
Translation impact | (1,893) | 2,727 |
Reclassify to definite-lived | 0 | |
Trademarks, Ending Balance | 81,184 | 83,077 |
Industrial Solutions | ||
Indefinite-lived Intangible Assets [Roll Forward] | ||
Trademarks, Beginning Balance | 9,681 | 41,622 |
Translation impact | (474) | 1,260 |
Reclassify to definite-lived | (33,201) | |
Trademarks, Ending Balance | $ 9,207 | $ 9,681 |
Accrued Liabilities - Carrying Value of Accrued Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Accrued Liabilities and Other Liabilities [Abstract] | ||
Current deferred revenue | $ 101,194 | $ 90,639 |
Wages, severance and related taxes | 56,129 | 57,633 |
Accrued rebates | 41,312 | 38,025 |
Employee benefits | 25,670 | 25,406 |
Accrued interest | 18,530 | 22,019 |
Other (individual items less than 5% of total current liabilities) | 121,441 | 68,929 |
Accrued liabilities | $ 364,276 | $ 302,651 |
Severance, Restructuring, and Acquisition Integration Activities Severance, Restructuring, and Acquisition Integration Activities - Severance, Restructuring and Integration Costs by Segment (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2018 |
Sep. 30, 2018 |
Jul. 01, 2018 |
Apr. 01, 2018 |
Dec. 31, 2017 |
Oct. 01, 2017 |
Jul. 02, 2017 |
Apr. 02, 2017 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
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Restructuring Cost and Reserve [Line Items] | |||||||||||
Severance | $ 10,323 | $ 5,211 | $ 7,082 | ||||||||
Other Restructuring and Integration Costs | 58,290 | 37,579 | 24,058 | ||||||||
Total Costs | $ 11,600 | $ 11,700 | $ 24,900 | $ 20,400 | $ 9,900 | $ 16,700 | $ 9,600 | $ 6,600 | 68,613 | 42,790 | 31,140 |
Enterprise Solutions | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Severance | 9,945 | 4,535 | 520 | ||||||||
Other Restructuring and Integration Costs | 47,618 | 24,508 | 18,041 | ||||||||
Total Costs | 57,563 | 29,043 | 18,561 | ||||||||
Industrial Solutions | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Severance | 378 | 676 | 6,562 | ||||||||
Other Restructuring and Integration Costs | 10,672 | 13,071 | 6,017 | ||||||||
Total Costs | $ 11,050 | $ 13,747 | $ 12,579 |
Long-Term Debt and Other Borrowing Arrangements - Maturities on Outstanding Long-Term Debt and Other Borrowings (Details) $ in Thousands |
Dec. 31, 2018
USD ($)
|
---|---|
Debt Disclosure [Abstract] | |
2019 | $ 0 |
2020 | 0 |
2021 | 0 |
2022 | 0 |
2023 | 0 |
Thereafter | 1,485,900 |
Total gross debt and other borrowing arrangements | $ 1,485,900 |
Net Investment Hedge Net Investment Hedge (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Cumulative translation adjustment | $ 27,802 | $ (65,046) | $ 18,687 |
Senior Subordinated Notes | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Cumulative translation adjustment | $ 87,500 | $ (56,200) |
Income Taxes - Components of Income Tax Expense (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Income (loss) before taxes: | |||
United States operations | $ 126,385 | $ 2,177 | $ (25,615) |
Foreign operations | 93,945 | 97,171 | 152,076 |
Income before taxes | 220,330 | 99,348 | 126,461 |
Currently payable | |||
United States federal | 27,529 | 0 | 2,981 |
United States state and local | 3,274 | 2,392 | (1,038) |
Foreign | 17,516 | 28,201 | 26,906 |
Income tax expense (benefit) | 48,319 | 30,593 | 28,849 |
Deferred | |||
United States federal | 10,942 | (11,028) | (27,677) |
United States state and local | 703 | (8,758) | (3,139) |
Foreign | (345) | (4,312) | 782 |
Deferred Income tax expense (benefit) | 11,300 | (24,098) | (30,034) |
Income tax expense (benefit) | $ 59,619 | $ 6,495 | $ (1,185) |
Income Taxes - Effective Income Tax Rate Reconciliation from Continuing Operations (Details) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Effective income tax rate reconciliation from continuing operations: | |||
United States federal statutory rate | 21.00% | 35.00% | 35.00% |
State and local income taxes | 1.70% | 0.80% | (0.90%) |
Impact of change in tax contingencies | (1.00%) | 2.20% | 2.40% |
Foreign income tax rate differences | (1.80%) | (13.10%) | (14.00%) |
Impact of change in deferred tax asset valuation allowance | 2.00% | 1.50% | (7.30%) |
Impact of change in legal entity tax status | 0.00% | 0.00% | (5.50%) |
Impact of non-taxable translation gain | 0.00% | (27.30%) | 0.00% |
Impact of non-taxable interest income | 0.00% | (5.50%) | (4.90%) |
Domestic permanent differences and tax credits | 0.70% | (15.70%) | (5.70%) |
Impact of tax reform | 4.50% | 28.60% | 0.00% |
Effective income tax rate reconciliation from continuing operations | 27.10% | 6.50% | (0.90%) |
Income Taxes - Components of Deferred Income Tax Balances (Details) - USD ($) $ in Thousands |
Dec. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Deferred income tax liabilities: | ||
Plant, equipment, and intangibles | $ (114,413) | $ (120,171) |
Deferred income tax assets: | ||
Postretirement, pensions, and stock compensation | 30,896 | 28,736 |
Reserves and accruals | 25,641 | 29,297 |
Net operating loss and tax credit carryforwards | 164,823 | 228,815 |
Valuation allowances | (90,872) | (151,841) |
Deferred tax assets | 130,488 | 135,007 |
Net deferred income tax asset | $ 16,075 | $ 14,836 |
Income Taxes - Summary of Tax Credit Carryforwards (Details) $ in Thousands |
Dec. 31, 2018
USD ($)
|
---|---|
Tax Credit Carryforward [Line Items] | |
Tax Credit Carryforwards | $ 71,040 |
United States | |
Tax Credit Carryforward [Line Items] | |
Tax Credit Carryforwards | 48,859 |
Canada | |
Tax Credit Carryforward [Line Items] | |
Tax Credit Carryforwards | $ 22,181 |
Income Taxes - Reconciliation of Beginning and Ending Amounts of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Balance at beginning of year | $ 8,579 | $ 10,474 |
Additions based on tax positions related to the current year | 866 | 981 |
Additions for tax positions of prior years | 1,292 | 2,549 |
Reductions for tax positions of prior years - Settlement | (1,689) | (5,425) |
Reduction for tax positions of prior years - Statute of limitations | (1,631) | 0 |
Balance at end of year | $ 7,417 | $ 8,579 |
Pension and Other Postretirement Benefits - Amounts Recognized in Balance Sheets (Details) - USD ($) $ in Thousands |
Dec. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Amounts recognized in the balance sheets: | ||
Accrued benefit liability (noncurrent) | $ (132,791) | $ (102,085) |
Pension Benefits | ||
Amounts recognized in the balance sheets: | ||
Prepaid benefit cost | 4,801 | 3,174 |
Accrued benefit liability (current) | (3,320) | (3,736) |
Accrued benefit liability (noncurrent) | (108,054) | (73,307) |
Net funded status | (106,573) | (73,869) |
Other Benefits | ||
Amounts recognized in the balance sheets: | ||
Prepaid benefit cost | 0 | 0 |
Accrued benefit liability (current) | (1,405) | (1,555) |
Accrued benefit liability (noncurrent) | (24,738) | (28,778) |
Net funded status | $ (26,143) | $ (30,333) |
Pension and Other Postretirement Benefits - Components of Net Periodic Benefit Costs (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Pension Benefits | |||
Components of net periodic benefit cost: | |||
Service cost | $ 4,705 | $ 4,978 | $ 4,981 |
Interest cost | 11,690 | 7,671 | 8,909 |
Expected return on plan assets | (16,391) | (10,644) | (12,013) |
Amortization of prior service credit | (42) | (41) | (42) |
Curtailment gain | 0 | 0 | (227) |
Settlement loss (gain) | 1,342 | (8) | 7,630 |
Net loss (gain) recognition | 2,810 | 2,597 | 2,670 |
Net periodic benefit cost | 4,114 | 4,553 | 11,908 |
Other Benefits | |||
Components of net periodic benefit cost: | |||
Service cost | 47 | 49 | 46 |
Interest cost | 945 | 1,139 | 1,259 |
Expected return on plan assets | 0 | 0 | 0 |
Amortization of prior service credit | 0 | 0 | (42) |
Curtailment gain | 0 | 0 | 0 |
Settlement loss (gain) | 0 | 0 | 0 |
Net loss (gain) recognition | (12) | 0 | 86 |
Net periodic benefit cost | $ 980 | $ 1,188 | $ 1,349 |
Pension and Other Postretirement Benefits - Benefits Expected to be Paid in Subsequent Years from Our Pension and Other Postretirement as Well as Medicare Subsidy Receipts (Details) $ in Thousands |
Dec. 31, 2018
USD ($)
|
---|---|
Pension Benefits | |
Pension And Other Employee Benefit Plans [Line Items] | |
2019 | $ 21,667 |
2020 | 22,965 |
2021 | 22,199 |
2022 | 23,157 |
2023 | 22,081 |
2024-2028 | 111,338 |
Total | 223,407 |
Other Benefits | |
Pension And Other Employee Benefit Plans [Line Items] | |
2019 | 1,432 |
2020 | 1,436 |
2021 | 1,438 |
2022 | 1,438 |
2023 | 1,432 |
2024-2028 | 7,196 |
Total | $ 14,372 |
Pension and Other Postretirement Benefits - Summary of Accumulated Other Comprehensive Loss That Have Not Been Recognized as Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands |
Dec. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Pension Benefits | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Net actuarial loss (gain) | $ 48,466 | $ 44,359 |
Net prior service cost | 2,734 | 11 |
Total | 51,200 | |
Other Benefits | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Net actuarial loss (gain) | (3,047) | (1,545) |
Net prior service cost | 0 | $ 0 |
Total | $ (3,047) |
Share-Based Compensation - Income Tax Benefit Recognized for our Share-Based Compensation Arrangements (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Total share-based compensation cost | $ 18,497 | $ 14,647 | $ 18,178 |
Income tax benefit | $ 4,402 | $ 5,566 | $ 7,069 |
Share-Based Compensation - Additional Information (Details) $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2018
USD ($)
| |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation cost related to all nonvested awards | $ 27.8 |
Unrecognized compensation cost is expected to be recognized over a weighted-average period | 2 years 1 month 10 days |
SARs and Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
SAR's and stock options expiration period | 10 years |
Restricted Shares and Units | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
Restricted Shares and Units | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 5 years |
Share-Based Compensation - Fair Values for SARs and Stock Options Estimated on Grant Date Using Black-Scholes-Merton Option-Pricing Formula Which Incorporates Assumptions (Details) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Weighted-average fair value of SARs and options granted (in usd per share) | $ 25.19 | $ 27.31 | $ 18.79 |
Total intrinsic value of SARs converted and options exercised | $ 2,263 | $ 7,156 | $ 9,678 |
Tax benefit related to share-based compensation | $ 113 | $ 967 | $ 1,171 |
Weighted-average fair value of restricted stock shares and units granted (in usd per share) | $ 72.54 | $ 79.96 | $ 54.52 |
Total fair value of restricted stock shares and units vested | $ 5,740 | $ 10,355 | $ 8,171 |
Expected volatility | 33.16% | 36.89% | 37.47% |
Expected term (in years) | 5 years 7 months 2 days | 5 years 7 months 2 days | 5 years 8 months 12 days |
Risk-free rate | 2.70% | 2.01% | 1.32% |
Dividend yield | 0.27% | 0.27% | 0.38% |
Preferred Stock (Details) $ / shares in Units, $ in Millions |
Jul. 15, 2019
shares
|
Jul. 26, 2016
USD ($)
trading_day
$ / shares
shares
|
---|---|---|
Depository Shares | ||
Class of Stock [Line Items] | ||
Depository shares issued | 5,200,000 | |
Preferred stock ownership interest | 0.01 | |
6.75% Series B Mandatory Convertible Preferred Stock | ||
Class of Stock [Line Items] | ||
Percentage of issued shares | 6.75% | |
Offering price (in usd per share) | $ / shares | $ 100 | |
Threshold trading days | trading_day | 20 | |
Proceeds from offering, net | $ | $ 501 | |
6.75% Series B Mandatory Convertible Preferred Stock | Scenario, Forecast | Minimum | ||
Class of Stock [Line Items] | ||
Preferred stock converted in to common stock (in shares) | 120.46 | |
Number of common stock issued upon conversion (in shares) | 6,200,000 | |
6.75% Series B Mandatory Convertible Preferred Stock | Scenario, Forecast | Maximum | ||
Class of Stock [Line Items] | ||
Preferred stock converted in to common stock (in shares) | 132.50 | |
Number of common stock issued upon conversion (in shares) | 6,900,000 |
Stockholder Rights Plan (Details) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | |
---|---|---|
Mar. 27, 2018 |
Dec. 31, 2018 |
|
Equity [Abstract] | ||
Redemption price per share (in USD per share) | $ 0.01 | |
Redemption of stockholders' rights agreement | $ 400 | $ 411 |
Share Repurchases (Details) - USD ($) $ / shares in Units, shares in Millions |
12 Months Ended | |||
---|---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Nov. 29, 2018 |
May 25, 2017 |
|
Equity, Class of Treasury Stock [Line Items] | ||||
Value of shares repurchased | $ 175,000,000 | $ 25,000,000 | ||
5/25/2017 Share Repurchase Program | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Stock Repurchase Program, Authorized Amount (in usd) | $ 200,000,000.0 | |||
Shares repurchased | 2.7 | 0.3 | ||
Value of shares repurchased | $ 175,000,000 | $ 25,000,000 | ||
Treasury stock acquired, average cost per share (in usd per share) | $ 64.94 | $ 79.75 | ||
Amount remaining of authorized amount for repurchase under the share repurchase program (in usd) | $ 0 | |||
11/29/2018 Share Repurchase Program | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Stock Repurchase Program, Authorized Amount (in usd) | $ 300,000,000 | |||
Shares repurchased | 0.0 |
Operating Leases - Additional Information (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Leases [Abstract] | |||
Operating lease expense incurred | $ 31.7 | $ 38.6 | $ 40.3 |
Operating Leases - Summary of Minimum Annual Lease Payments for Noncancelable Operating Leases (Details) $ in Thousands |
Dec. 31, 2018
USD ($)
|
---|---|
Leases [Abstract] | |
2019 | $ 19,877 |
2020 | 17,531 |
2021 | 14,776 |
2022 | 12,317 |
2023 | 7,654 |
Thereafter | 28,771 |
Total | $ 100,926 |
Contingent Liabilities (Details) $ in Millions |
Dec. 31, 2018
USD ($)
|
---|---|
Standby Letters of Credit | |
Line of Credit Facility [Line Items] | |
Loss contingency, range of possible loss, portion not accrued | $ 7.5 |
Bank Guaranties | |
Line of Credit Facility [Line Items] | |
Loss contingency, range of possible loss, portion not accrued | 3.9 |
Surety Bonds | |
Line of Credit Facility [Line Items] | |
Loss contingency, range of possible loss, portion not accrued | $ 2.4 |
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Supplemental Cash Flow Elements [Abstract] | |||
Income tax refunds received | $ 4,782 | $ 5,031 | $ 3,838 |
Income taxes paid | (54,109) | (35,893) | (26,587) |
Interest paid | $ (48,519) | $ (79,047) | $ (87,076) |
Quarterly Operating Results (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2018 |
Sep. 30, 2018 |
Jul. 01, 2018 |
Apr. 01, 2018 |
Dec. 31, 2017 |
Oct. 01, 2017 |
Jul. 02, 2017 |
Apr. 02, 2017 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Number of days in quarter | 92 days | 91 days | 91 days | 91 days | 91 days | 91 days | 91 days | 92 days | 365 days | 365 days | |
Revenues | $ 655,390 | $ 655,774 | $ 668,639 | $ 605,565 | $ 604,884 | $ 621,745 | $ 610,633 | $ 551,381 | $ 2,585,368 | $ 2,388,643 | $ 2,356,672 |
Gross profit | 259,365 | 260,857 | 257,596 | 230,594 | 229,426 | 239,849 | 243,104 | 222,374 | 1,008,412 | 934,753 | 981,321 |
Operating income | 73,234 | 131,278 | 56,506 | 44,203 | 59,915 | 61,116 | 62,776 | 51,597 | 305,221 | 235,404 | 232,083 |
Net income | 43,491 | 85,858 | 28,792 | 2,570 | 30,436 | 945 | 35,891 | 25,581 | 160,711 | 92,853 | 127,646 |
Less: Net loss attributable to noncontrolling interest | (35) | (23) | (77) | (48) | (83) | (82) | (86) | (106) | (183) | (357) | (357) |
Net income attributable to Belden | 43,526 | 85,881 | 28,869 | 2,618 | 30,519 | 1,027 | 35,977 | 25,687 | 160,894 | 93,210 | 128,003 |
Less: Preferred stock dividends | 8,733 | 8,732 | 8,733 | 8,733 | 8,733 | 8,732 | 8,733 | 8,733 | 34,931 | 34,931 | 15,428 |
Net income (loss) attributable to Belden common stockholders | $ 34,793 | $ 77,149 | $ 20,136 | $ (6,115) | $ 21,786 | $ (7,705) | $ 27,244 | $ 16,954 | $ 125,963 | $ 58,279 | $ 112,575 |
Basic income (loss) per share attributable to Belden common stockholders: | $ 0.87 | $ 1.90 | $ 0.49 | $ (0.15) | $ 0.52 | $ (0.18) | $ 0.64 | $ 0.40 | $ 3.10 | $ 1.38 | $ 2.67 |
Diluted income (loss) per share attributable to Belden stockholders: | $ 0.87 | $ 1.80 | $ 0.49 | $ (0.15) | $ 0.51 | $ (0.18) | $ 0.64 | $ 0.40 | $ 3.08 | $ 1.37 | $ 2.65 |
Quarterly Operating Results (Unaudited) - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2018 |
Sep. 30, 2018 |
Jul. 01, 2018 |
Apr. 01, 2018 |
Dec. 31, 2017 |
Oct. 01, 2017 |
Jul. 02, 2017 |
Apr. 02, 2017 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Quantifying Misstatement in Current Year Financial Statements [Line Items] | |||||||||||
Severance, restructuring, and acquisition integration costs | $ 11,600 | $ 11,700 | $ 24,900 | $ 20,400 | $ 9,900 | $ 16,700 | $ 9,600 | $ 6,600 | $ 68,613 | $ 42,790 | $ 31,140 |
Overstatement Of Revenues | |||||||||||
Quantifying Misstatement in Current Year Financial Statements [Line Items] | |||||||||||
Qualifying misstatement | 27,800 | 11,800 | 10,400 | 6,100 | |||||||
Overstatement Of Net Income | |||||||||||
Quantifying Misstatement in Current Year Financial Statements [Line Items] | |||||||||||
Qualifying misstatement | $ 5,200 | $ 2,600 | $ 1,300 | $ 3,000 |
Subsequent Events (Details) $ in Millions |
Jan. 30, 2019
USD ($)
|
---|---|
Subsequent Event | SAM earnout | Settled Litigation | |
Subsequent Events [Line Items] | |
Interest and fees incurred for settlement | $ 0.9 |
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