[X]
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the Fiscal Year Ended December 31, 2015
|
|
or
|
|
[ ]
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the transition period from ___________ to ____________
|
NEW JERSEY
|
|
22-1463699
|
(State of incorporation)
|
|
(I.R.S. Employer Identification No.)
|
Title of Each Class |
|
Name of Each Exchange
on which Registered |
Class A Common Stock ($0.10 par value)
|
|
NASDAQ Global Select Market
|
Class B Common Stock ($0.10 par value)
|
NASDAQ Global Select Market
|
Indicate by checkmark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
|
Yes [ ] |
No [X] |
Indicate by checkmark if the registrant is not required to file reports to Section 13 or 15(d) of the Act.
|
Yes [ ]
|
No [X]
|
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
|
Yes [X]
|
No [ ]
|
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
|
Yes [X]
|
No [ ]
|
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
|
[X]
|
Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
|
Large accelerated filer [ ]
|
Accelerated filer [X]
|
Non-accelerated filer [ ]
(Do not check if a smaller reporting company) |
Smaller reporting company [ ]
|
||
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
|
Yes [ ]
|
No [X]
|
Title of Each Class |
|
Number of Shares of Common Stock Outstanding as of March 1, 2016
|
Class A Common Stock
|
|
2,174,912
|
Class B Common Stock
|
9,701,977
|
BEL FUSE INC.
|
|||
Page
|
|||
Cautionary Notice Regarding Forward-Looking Information
|
1
|
||
Part I
|
|||
Item 1.
|
2
|
||
Item 1A.
|
7
|
||
Item 1B.
|
13
|
||
Item 2.
|
14
|
||
Item 3.
|
14
|
||
Item 4.
|
14
|
||
Part II
|
|||
Item 5.
|
|||
15
|
|||
Item 6.
|
17
|
||
Item 7.
|
|||
19
|
|||
Item 7A.
|
30
|
||
Item 8.
|
31
|
||
Item 9.
|
|||
71
|
|||
Item 9A.
|
71
|
||
Item 9B.
|
71
|
||
Part III
|
|||
Item 10.
|
72
|
||
Item 11.
|
72
|
||
Item 12.
|
|||
72
|
|||
Item 13.
|
72
|
||
Item 14.
|
72
|
||
Part IV
|
|||
Item 15.
|
73
|
||
75
|
Product Line
|
Function
|
Applications
|
Brands Sold Under
|
|
Magnetic Solutions
|
Integrated Connector Modules (ICMs)
|
Condition, filter, and isolate the electronic signal to ensure accurate data/voice/video transmission and provide RJ45 and USB connectivity.
|
Network switches, routers, hubs, and PCs used in 10/100/1000 Gigabit Ethernet, Power over Ethernet (PoE), PoE Plus and home networking applications.
|
Bel, TRP, MagJack®
|
Power Transformers
|
Safety isolation and distribution.
|
Power supplies, alarm, fire detection, and security systems, HVAC, lighting and medical equipment. Class 2, three phase, chassis mount, and PC mount designs available.
|
Signal
|
|
SMD Power Inductors & SMPS Transformers
|
A passive component that stores energy in a magnetic field. Widely used in analog electronic circuitry.
|
Switchmode power supplies, DC-DC converters, LED lighting, automotive and consumer electronics.
|
Signal
|
|
Discrete Components-Telecom
|
Condition, filter, and isolate the electronic signal to ensure accurate data/voice/video transmission.
|
Network switches, routers, hubs, and PCs used in 10/100/1000 Gigabit Ethernet and Power over Ethernet (PoE).
|
Bel
|
Product Line
|
Function
|
Applications
|
Brands Sold Under
|
|
Power Solutions & Protection
|
Front-End Power Supplies
|
Provides the primary point of isolation between AC main line (input) and the low-voltage DC output that is used to power all electronics downstream
|
Servers, telecommunication, network and data storage equipment
|
Bel Power Solutions, Power-One
|
Board-Mount Power Products
|
These are designed to be mounted on a circuit board. These converters take input voltage and provide localized on-board power to low-voltage electronics.
|
Telecom (central office switches), networking and a broad range of industrial applications
|
Bel Power Solutions, Power-One, Melcher
|
|
Industrial Power Products
|
Converts between AC main line inputs and a wide variety of DC output voltages.
|
Rail, transportation, automation, test and measurement, medical, military and aerospace applications.
|
Bel Power Solutions, Power-One, Melcher
|
|
Module Products
|
Condition, filter, and isolate the electronic signal to ensure accurate data/voice/video transmission within a highly integrated, reduced footprint.
|
Broadband equipment, home networking, set top boxes, and telecom equipment supporting ISDN, T1/E1 and DSL technologies. Industrial applications include Smart Meters, Smart Grid communication platforms, vehicle communications and traffic management.
|
Bel
|
|
Circuit Protection
|
Protects devices by preventing current in an electrical circuit from exceeding acceptable levels.
|
Power supplies, cell phone chargers, consumer electronics, and battery protection.
|
Bel
|
Product Line
|
Function
|
Applications
|
Brands Sold Under
|
|
Connectivity Solutions
|
Expanded Beam Fiber Optic Connectors, Cable Assemblies and Active Optical Devices (transceivers and media converters)
|
Harsh-environment, high-reliability, flight-grade optical connectivity for high-speed communications.
|
Military/aerospace, oil and gas well monitoring and exploration, broadcast, communications, RADAR
|
Stratos, Fibreco
|
Copper-based Connectors / Cable Assemblies-FQIS
|
Harsh-environment, high-reliability connectivity and fuel quantity monitoring (FQIS).
|
Commercial aerospace, avionics, smart munitions, communications, navigations and various industrial equipment
|
Cinch
|
|
RF Connectors, Cable Assemblies, Microwave Devices and Low Loss Cable
|
Connectors and cable assemblies designed to provide connectivity within radio frequency (RF) applications.
|
Military/aerospace, test and measurement, high-frequency and wireless communications
|
Johnson, Trompeter, Midwest Microwave, Semflex
|
|
RJ Connectors and Cable Assemblies
|
RJ45 and RJ11 connectivity for data/voice/video transmission.
|
Largely Ethernet applications including network routers, hubs, switches, and patch panels.
|
Stewart Connector
|
•
|
|
foreign currency exchange controls and tax rates;
|
•
|
|
foreign currency exchange rate fluctuations, including devaluations;
|
•
|
|
the potential for changes in regional and local economic conditions, including local inflationary pressures;
|
•
|
|
restrictive governmental actions such as those on transfer or repatriation of funds and trade protection matters, including antidumping duties, tariffs, embargoes and prohibitions or restrictions on acquisitions or joint ventures;
|
•
|
|
changes in laws and regulations, including the laws and policies of the United States affecting trade and foreign investment;
|
•
|
|
the difficulty of enforcing agreements and collecting receivables through certain foreign legal systems;
|
•
|
|
variations in protection of intellectual property and other legal rights;
|
•
|
|
more expansive legal rights of foreign unions or works councils;
|
•
|
|
changes in labor conditions and difficulties in staffing and managing international operations;
|
•
|
|
social plans that prohibit or increase the cost of certain restructuring actions;
|
•
|
|
the potential for nationalization of enterprises or facilities; and
|
•
|
|
unsettled political conditions and possible terrorist attacks against U.S. or other interests.
|
·
|
announcements of technological or competitive developments;
|
·
|
general market or economic conditions;
|
·
|
market or economic conditions specific to particular geographical areas in which we operate;
|
·
|
acquisitions or strategic alliances by us or our competitors;
|
·
|
the gain or loss of a significant customer or order; or
|
·
|
changes in estimates of our financial performance or changes in recommendations by securities analysts regarding us or our industry
|
Location
|
Approximate
Square Feet
|
Owned/
Leased
|
Percentage
Used for
Manufacturing
|
||||||
Dongguan, People's Republic of China
|
650,000
|
Leased
|
28
|
%
|
|||||
Pingguo, People's Republic of China
|
251,000
|
Leased
|
71
|
%
|
|||||
Shanghai, People's Republic of China
|
32,000
|
Leased
|
70
|
%
|
|||||
Shenzhen, People's Republic of China
|
227,000
|
Leased
|
100
|
%
|
|||||
Zhongshan, People's Republic of China
|
315,000
|
Leased
|
86
|
%
|
|||||
Zhongshan, People's Republic of China
|
118,000
|
Owned
|
100
|
%
|
|||||
Zhongshan, People's Republic of China
|
78,000
|
Owned
|
100
|
%
|
|||||
Louny, Czech Republic
|
11,000
|
Owned
|
75
|
%
|
|||||
Dubnica nad Vahom, Slovakia
|
35,000
|
Owned
|
100
|
%
|
|||||
Dubnica nad Vahom, Slovakia
|
70,000
|
Leased
|
100
|
%
|
|||||
Worksop, England (a)
|
52,000
|
Leased
|
28
|
%
|
|||||
Great Dunmow, England
|
9,000
|
Leased
|
52
|
%
|
|||||
Chelmsford, United Kingdom
|
21,000
|
Leased
|
60
|
%
|
|||||
Dominican Republic
|
41,000
|
Leased
|
85
|
%
|
|||||
Cananea, Mexico
|
42,000
|
Leased
|
60
|
%
|
|||||
Reynosa, Mexico
|
77,000
|
Leased
|
56
|
%
|
|||||
Inwood, New York
|
39,000
|
Owned
|
40
|
%
|
|||||
Glen Rock, Pennsylvania
|
74,000
|
Owned
|
60
|
%
|
|||||
Waseca, Minnesota
|
124,000
|
Leased
|
83
|
%
|
|||||
McAllen, Texas
|
40,000
|
Leased
|
56
|
%
|
|||||
Miami, Florida
|
29,000
|
Leased
|
85
|
%
|
|||||
Melbourne, Florida
|
18,000
|
Leased
|
64
|
%
|
|||||
Mesa, Arizona
|
7,000
|
Leased
|
100
|
%
|
|||||
2,360,000
|
(a)
|
Market Information
|
Class A
|
Class B
|
|||||||||||||||
High
|
Low
|
High
|
Low
|
|||||||||||||
Year Ended December 31, 2015
|
||||||||||||||||
First Quarter
|
$
|
24.66
|
$
|
18.17
|
$
|
27.53
|
$
|
18.79
|
||||||||
Second Quarter
|
23.38
|
17.33
|
23.23
|
17.35
|
||||||||||||
Third Quarter
|
20.95
|
14.19
|
23.77
|
16.46
|
||||||||||||
Fourth Quarter
|
21.80
|
14.29
|
23.73
|
16.16
|
||||||||||||
Year Ended December 31, 2014
|
||||||||||||||||
First Quarter
|
$
|
20.04
|
$
|
17.80
|
$
|
22.10
|
$
|
17.80
|
||||||||
Second Quarter
|
27.23
|
19.00
|
27.50
|
19.57
|
||||||||||||
Third Quarter
|
25.73
|
21.17
|
26.67
|
22.16
|
||||||||||||
Fourth Quarter
|
26.70
|
20.33
|
29.26
|
22.18
|
||||||||||||
(d)
|
Common Stock Performance Comparisons
|
Years Ended December 31,
|
||||||||||||||||||||
2015
|
2014
|
2013
|
2012
|
2011
|
||||||||||||||||
(In thousands of dollars, except per share data)
|
||||||||||||||||||||
Selected Consolidated Statements of Operations Data: (a)
|
||||||||||||||||||||
Net sales
|
$
|
567,080
|
$
|
487,076
|
$
|
349,189
|
$
|
286,594
|
$
|
295,121
|
||||||||||
Cost of sales
|
458,253
|
399,721
|
286,952
|
240,115
|
244,749
|
|||||||||||||||
Selling, general and administrative expenses
|
78,113
|
72,051
|
45,803
|
39,571
|
39,284
|
|||||||||||||||
Stock-based compensation
|
2,815
|
2,717
|
1,879
|
1,767
|
1,709
|
|||||||||||||||
Litigation charges (b)
|
-
|
-
|
41
|
26
|
3,471
|
|||||||||||||||
Restructuring charges (c)
|
2,114
|
1,832
|
1,387
|
5,245
|
314
|
|||||||||||||||
Earnings before income taxes
|
25,732
|
9,770
|
15,165
|
997
|
7,872
|
|||||||||||||||
Net earnings
|
$
|
19,197
|
$
|
8,603
|
$
|
15,908
|
$
|
2,373
|
$
|
3,764
|
||||||||||
Reconciliation of net earnings to EBITDA (d):
|
||||||||||||||||||||
Net earnings
|
$
|
19,197
|
$
|
8,603
|
$
|
15,908
|
$
|
2,373
|
$
|
3,764
|
||||||||||
Depreciation and amortization (e)
|
23,008
|
20,367
|
12,382
|
9,113
|
8,667
|
|||||||||||||||
Interest expense
|
7,588
|
3,978
|
156
|
16
|
-
|
|||||||||||||||
Income tax provision (benefit)
|
6,535
|
1,167
|
(743
|
)
|
(1,376
|
)
|
4,108
|
|||||||||||||
EBITDA (d)
|
$
|
56,328
|
$
|
34,115
|
$
|
27,703
|
$
|
10,126
|
$
|
16,539
|
||||||||||
Net earnings per share:
|
||||||||||||||||||||
Class A common share - basic and diluted
|
1.53
|
0.69
|
1.32
|
0.17
|
0.28
|
|||||||||||||||
Class B common share - basic and diluted
|
1.64
|
0.75
|
1.41
|
0.21
|
0.33
|
|||||||||||||||
Cash dividends declared per share:
|
||||||||||||||||||||
Class A common share
|
0.24
|
0.24
|
0.24
|
0.24
|
0.24
|
|||||||||||||||
Class B common share
|
0.28
|
0.28
|
0.28
|
0.28
|
0.28
|
|||||||||||||||
As of December 31,
|
||||||||||||||||||||
2015
|
2014
|
2013
|
2012
|
2011
|
||||||||||||||||
(In thousands of dollars, except percentages)
|
||||||||||||||||||||
Selected Consolidated Balance Sheet Data and Ratios:
|
||||||||||||||||||||
Cash and cash equivalents
|
$
|
85,040
|
$
|
77,138
|
$
|
62,123
|
$
|
71,262
|
88,241
|
|||||||||||
Working capital
|
163,428
|
188,854
|
137,174
|
144,530
|
165,264
|
|||||||||||||||
Goodwill
|
121,634
|
118,369
|
18,490
|
13,559
|
4,163
|
|||||||||||||||
Total assets
|
587,011
|
635,421
|
308,141
|
275,189
|
276,911
|
|||||||||||||||
Total debt
|
187,188
|
232,625
|
-
|
-
|
-
|
|||||||||||||||
Stockholders' equity
|
233,122
|
224,273
|
228,702
|
215,362
|
221,080
|
|||||||||||||||
Return on average total assets (f)
|
3.0
|
%
|
1.8
|
%
|
5.4
|
%
|
0.9
|
%
|
1.4
|
%
|
||||||||||
Return on average stockholders' equity (f)
|
8.2
|
%
|
3.8
|
%
|
7.3
|
%
|
1.1
|
%
|
1.7
|
%
|
(a)
|
See Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," for a discussion of the factors that contributed to our consolidated operating results and our consolidated cash flows for the three years ended December 31, 2015.
|
(b)
|
During 2011, the Company recorded litigation charges totaling $3.5 million related to the SynQor and Halo lawsuits. See Note 16, "Commitments and Contingencies," for further information on the SynQor lawsuit. The Halo lawsuit was resolved in 2011.
|
(c)
|
See Note 3, "Restructuring Activities," for further information on restructuring charges incurred during the three years ended December 31, 2015. During 2012, Bel initiated the closure of its Cinch North American manufacturing facility in Vinita, Oklahoma, and transition of the operations to Reynosa, Medico and a new facility in McAllen, Texas. The Company recorded $5.2 million related to this restructuring during 2012, comprised primarily of $3.2 million in severance costs, $1.4 million related to asset disposals and $0.6 million of other expenses. During 2011, the Company recorded restructuring costs associated with the realignment of its Cinch UK operations.
|
(d)
|
EBITDA is a non‑U.S. GAAP measure that is not a measure of performance under accounting principles generally accepted in the United States of America ("U.S. GAAP"). EBITDA has limitations as an analytical tool and should not be considered in isolation from or as a substitute for U.S. GAAP information. It does not purport to represent any similarly titled U.S. GAAP information and is not an indicator of our performance under U.S. GAAP. EBITDA may not be comparable with similarly titled measures used by others. Investors are cautioned against placing undue reliance on this non-GAAP measure. Our management may assess our financial results both on a U.S. GAAP basis and on a non-U.S. GAAP basis. Non-U.S. GAAP financial measures provide management with additional means to understand and evaluate the core operating results and trends in our ongoing business.
|
(e)
|
Depreciation and amortization is included in both cost of sales and selling, general and administrative expenses on the consolidated statements of operations.
|
(f)
|
Returns on average total assets and stockholders' equity are computed for each year by dividing net earnings for such year by the average balances of total assets or stockholders' equity, as applicable, on the last day of each quarter during such year and on the last day of the immediately preceding year.
|
·
|
Recent Acquisitions – The Company has completed four acquisitions since the first quarter of 2013. During the years ended December 31, 2015, 2014 and 2013, the acquired companies have contributed a combined $309.0 million, $209.8 million and $68.6 million of sales, respectively, and a combined $19.6 million, $10.2 million and $8.4 million in income from operations, respectively.
|
·
|
Net Sales – Excluding the net sales contributions from the 2013 and 2014 Acquisitions as described above, the Company's net sales for the years ended December 31, 2015, 2014 and 2013 were $258.1 million, $277.3 million and $280.6 million, respectively. By segment, excluding the net sales contributions from the 2013 and 2014 Acquisitions, net sales in Asia decreased by $18.4 million, European net sales were down by $2.7 million and sales in North America increased by $1.8 million in 2015 as compared to 2014. The decline in Bel's legacy business net sales resulted primarily from lower demand of its DC-DC converter, ICM and passive connector products as compared to 2014.
|
·
|
Product Mix – Material and labor costs vary by product line and any significant shift in product mix between higher- and lower-margin product lines will have a corresponding impact on the Company's gross margin percentage. As compared to the pre-2014 (legacy-Bel) business on average, the recently acquired Power Solutions business has lower margins and Connectivity Solutions has higher margins. Fluctuations in sales volume of Power Solutions or Connectivity Solutions products will have a corresponding impact on Bel's profit margins.
|
·
|
Pricing and Availability of Materials – Pricing and availability of components that constitute raw materials in our manufacturing processes have been stable for most of the Company's product lines, although lead times on certain electrical components continue to be extended. Pricing of electrical components during the year ended December 31, 2015 was flat compared to the same period of 2014. With regard to commodity pricing, the costs of certain commodities that are contained in components and other raw materials, such as gold and copper, were lower during 2015 as compared to 2014. Any fluctuations in component prices and other commodity prices associated with Bel's raw materials will have a corresponding impact on Bel's operating results.
|
·
|
Restructuring – The Company continued to implement restructuring programs throughout 2015 in connection with integrating the 2014 Acquisitions into the legacy-Bel structure and other cost savings and facility consolidation efforts. During the years ended December 31, 2015, 2014 and 2013, the Company incurred $2.1 million, $1.8 million and $1.4 million, respectively, in restructuring costs, primarily for severance and termination benefits. The measures implemented in 2015 are projected to result in incremental savings of $3 million to $4 million on an annualized basis, beginning in 2016. The Company will continue to review its operations for further cost containment opportunities and additional restructuring charges may be incurred in future quarters. The projected cost savings represent Forward-Looking Statements. See "Cautionary Notice Regarding Forward-Looking Information."
|
·
|
Labor Costs – Labor costs as a percentage of sales were 10.7% of sales in 2015 as compared to 12.1% of sales in 2014 and 14.5% of sales in 2013. The influx of the 2014 Acquisitions resulted in a lower consolidated labor cost as a percentage of sales as labor costs for the Power Solutions business in 2015 was 5.2% of their respective sales and Connectivity Solutions' labor costs were 7.0% of their respective sales.
|
·
|
Acquisition-Related Costs – The acquisitions of Power Solutions and Connectivity Solutions in 2014 gave rise to acquisition-related costs of $0.6 million in 2015 and $7.3 million in 2014, which includes professional fees for independent valuations and carve-out audits for each of the acquired companies. In addition to these costs, a combined $5.9 million of inventory step up costs were charged to cost of sales in 2014.
|
·
|
Impact of Foreign Currency – Since we are a U.S. domiciled company, we translate our foreign currency-denominated financial results into U.S. dollars. Due to the changes in the value of foreign currencies relative to the U.S. dollar, translating our financial results and the revaluation of certain intercompany transactions to and from foreign currencies to U.S. dollars may result in a favorable or unfavorable impact to our consolidated statements of operations and cash flows. The Company monitors changes in foreign currencies and implements pricing actions to help mitigate the impact that changes in foreign currencies may have on its operating results. See Selling, General and Administrative Expenses and Inflation and Foreign Currency Exchange below for further details.
|
·
|
Effective Tax Rate – The Company's effective tax rate will fluctuate based on the geographic segment in which our pretax profits are earned. Of the geographic segments in which we operate, the U.S. has the highest tax rates; Europe's tax rates are generally lower than U.S. tax rates; and Asia has the lowest tax rates of the Company's three geographical segments. See Note 9, "Income Taxes."
|
2015
|
2014
|
2013
|
||||||||||||||||||||||
North America
|
$
|
304,328
|
54
|
%
|
$
|
217,258
|
45
|
%
|
$
|
116,548
|
33
|
%
|
||||||||||||
Asia
|
188,146
|
33
|
%
|
201,338
|
41
|
%
|
193,647
|
56
|
%
|
|||||||||||||||
Europe
|
74,606
|
13
|
%
|
68,480
|
14
|
%
|
38,994
|
11
|
%
|
|||||||||||||||
$
|
567,080
|
100
|
%
|
$
|
487,076
|
100
|
%
|
$
|
349,189
|
100
|
%
|
2015
|
2014
|
2013
|
||||||||||
Total segment sales:
|
||||||||||||
North America
|
$
|
329,304
|
$
|
248,007
|
$
|
128,472
|
||||||
Asia
|
295,751
|
275,765
|
225,151
|
|||||||||
Europe
|
148,735
|
114,748
|
40,742
|
|||||||||
Total segment sales
|
773,790
|
638,520
|
394,365
|
|||||||||
Reconciling item:
|
||||||||||||
Intersegment sales
|
(206,710
|
)
|
(151,444
|
)
|
(45,176
|
)
|
||||||
Net sales
|
$
|
567,080
|
$
|
487,076
|
$
|
349,189
|
||||||
Income (loss) from operations:
|
||||||||||||
North America
|
$
|
11,012
|
$
|
(4,531
|
)
|
$
|
(1,560
|
)
|
||||
Asia
|
8,175
|
13,090
|
15,356
|
|||||||||
Europe
|
9,413
|
4,913
|
1,251
|
|||||||||
$
|
28,600
|
$
|
13,472
|
$
|
15,047
|
Years Ended
|
||||||||||||||||||||||||
December 31,
|
||||||||||||||||||||||||
2015
|
2014
|
2013
|
||||||||||||||||||||||
Power solutions and protection
|
$
|
214,766
|
38
|
%
|
$
|
159,867
|
33
|
%
|
$
|
67,370
|
19
|
%
|
||||||||||||
Connectivity solutions
|
181,697
|
32
|
%
|
152,954
|
31
|
%
|
111,653
|
32
|
%
|
|||||||||||||||
Magnetic solutions
|
170,617
|
30
|
%
|
174,255
|
36
|
%
|
170,166
|
49
|
%
|
|||||||||||||||
$
|
567,080
|
100
|
%
|
$
|
487,076
|
100
|
%
|
$
|
349,189
|
100
|
%
|
Years Ended
|
||||||||||||
December 31,
|
||||||||||||
2015
|
2014
|
2013
|
||||||||||
Material costs
|
43.6
|
%
|
44.9
|
%
|
42.5
|
%
|
||||||
Labor costs
|
10.7
|
%
|
12.1
|
%
|
14.5
|
%
|
||||||
Research and development expenses
|
4.9
|
%
|
4.4
|
%
|
4.0
|
%
|
||||||
Other expenses
|
21.6
|
%
|
20.7
|
%
|
21.2
|
%
|
||||||
Total cost of sales
|
80.8
|
%
|
82.1
|
%
|
82.2
|
%
|
·
|
the incremental impact of SG&A expenses related to the 2013 and 2014 Acquisitions of $19.1 million;
|
·
|
higher acquisition-related costs of $6.5 million related to the 2014 Acquisitions; and
|
·
|
an increase in salaries of $1.5 million.
|
Payments due by period (dollars in thousands)
|
||||||||||||||||||||
Contractual Obligations
|
Total
|
Less than 1 year
|
1-3
years |
3-5
years |
More than
5 years |
|||||||||||||||
Long-term debt obligations(1)
|
$
|
187,188
|
$
|
24,772
|
$
|
43,001
|
$
|
119,415
|
$
|
-
|
||||||||||
Interest payments due on long-term debt(2)
|
15,312
|
5,208
|
8,522
|
1,582
|
-
|
|||||||||||||||
Capital expenditure obligations
|
1,541
|
1,541
|
-
|
-
|
-
|
|||||||||||||||
Operating leases
|
23,430
|
7,924
|
9,079
|
4,216
|
2,211
|
|||||||||||||||
Raw material purchase obligations
|
42,607
|
42,452
|
155
|
-
|
-
|
|||||||||||||||
First quarter 2016 quarterly cash dividend declared
|
810
|
810
|
||||||||||||||||||
Total
|
$
|
270,888
|
$
|
82,707
|
$
|
60,757
|
$
|
125,213
|
$
|
2,211
|
·
|
Applying a compounded annual growth rate for forecasted sales in our projected cash flows through 2020.
|
Reporting Unit
|
Compounded Annual Growth Rate
|
|||
North America
|
2.0
|
%
|
||
Asia
|
2.0
|
%
|
||
Europe
|
2.0
|
%
|
·
|
Applying a terminal value growth rate of 2% for our reporting units to reflect our estimate of stable and perpetual growth.
|
·
|
Determining an appropriate discount rate to apply to our projected cash flow results. This discount rate reflects, among other things, certain risks due to the uncertainties of achieving the cash flow results and the growth rates assigned. The discount rates applied were as follows:
|
Reporting Unit
|
Discount Rate
|
|||
North America
|
11.0
|
%
|
||
Asia
|
15.0
|
%
|
||
Europe
|
11.0
|
%
|
·
|
A weighting of the results of the income approach of 75% of our overall fair value calculation for each reporting unit.
|
BEL FUSE INC.
|
|||
INDEX
|
|||
Financial Statements
|
Page
|
||
33
|
|||
34
|
|||
35
|
|||
36
|
|||
37
|
|||
38
|
|||
40
|
BEL FUSE INC. AND SUBSIDIARIES
|
||||||||
(dollars in thousands, except share and per share data)
|
||||||||
December 31,
|
December 31,
|
|||||||
2015
|
2014
|
|||||||
(Revised)
|
||||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
85,040
|
$
|
77,138
|
||||
Accounts receivable - less allowance for doubtful accounts
|
||||||||
of $1,747 and $1,989 at December 31, 2015 and 2014, respectively
|
86,268
|
99,605
|
||||||
Inventories
|
98,510
|
113,630
|
||||||
Other current assets
|
15,636
|
20,283
|
||||||
Total current assets
|
285,454
|
310,656
|
||||||
Property, plant and equipment, net
|
57,611
|
69,261
|
||||||
Intangible assets, net
|
87,827
|
95,502
|
||||||
Goodwill
|
121,634
|
118,369
|
||||||
Deferred income taxes
|
3,321
|
7,933
|
||||||
Other assets
|
31,164
|
33,700
|
||||||
Total assets
|
$
|
587,011
|
$
|
635,421
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
49,798
|
$
|
61,926
|
||||
Accrued expenses
|
38,323
|
42,588
|
||||||
Current maturities of long-term debt
|
24,772
|
13,438
|
||||||
Other current liabilities
|
9,133
|
3,850
|
||||||
Total current liabilities
|
122,026
|
121,802
|
||||||
Long-term liabilities:
|
||||||||
Long-term debt
|
162,416
|
219,187
|
||||||
Liability for uncertain tax positions
|
40,295
|
39,767
|
||||||
Minimum pension obligation and unfunded pension liability
|
15,576
|
14,205
|
||||||
Deferred income taxes
|
13,002
|
15,739
|
||||||
Other long-term liabilities
|
574
|
448
|
||||||
Total liabilities
|
353,889
|
411,148
|
||||||
Commitments and contingencies
|
||||||||
Stockholders' equity:
|
||||||||
Preferred stock, no par value, 1,000,000 shares authorized; none issued
|
-
|
-
|
||||||
Class A common stock, par value $.10 per share, 10,000,000 shares
|
||||||||
authorized; 2,174,912 shares outstanding at each date (net of
|
||||||||
1,072,769 treasury shares)
|
217
|
217
|
||||||
Class B common stock, par value $.10 per share, 30,000,000 shares
|
||||||||
authorized; 9,701,977 and 9,686,777 shares outstanding, respectively
|
||||||||
(net of 3,218,307 treasury shares)
|
970
|
969
|
||||||
Additional paid-in capital
|
24,440
|
21,626
|
||||||
Retained earnings
|
229,371
|
213,409
|
||||||
Accumulated other comprehensive (loss) income
|
(21,876
|
)
|
(11,948
|
)
|
||||
Total stockholders' equity
|
233,122
|
224,273
|
||||||
Total liabilities and stockholders' equity
|
$
|
587,011
|
$
|
635,421
|
||||
See accompanying notes to consolidated financial statements.
|
BEL FUSE INC. AND SUBSIDIARIES
|
||||||||||||
(dollars in thousands, except per share data)
|
||||||||||||
Year Ended December 31,
|
||||||||||||
2015
|
2014
|
2013
|
||||||||||
(Revised)
|
||||||||||||
Net sales
|
$
|
567,080
|
$
|
487,076
|
$
|
349,189
|
||||||
Cost of sales
|
458,253
|
399,721
|
286,952
|
|||||||||
Selling, general and administrative expenses
|
78,113
|
72,051
|
45,803
|
|||||||||
Restructuring charges
|
2,114
|
1,832
|
1,387
|
|||||||||
Income from operations
|
28,600
|
13,472
|
15,047
|
|||||||||
Interest expense
|
(7,588
|
)
|
(3,978
|
)
|
(156
|
)
|
||||||
Interest income and other, net
|
4,720
|
276
|
274
|
|||||||||
Earnings before provision (benefit) for income taxes
|
25,732
|
9,770
|
15,165
|
|||||||||
Provision (benefit) for income taxes
|
6,535
|
1,167
|
(743
|
)
|
||||||||
Net earnings available to common shareholders
|
$
|
19,197
|
$
|
8,603
|
$
|
15,908
|
||||||
Net earnings per common share:
|
||||||||||||
Class A common shares - basic and diluted
|
$
|
1.53
|
$
|
0.69
|
$
|
1.32
|
||||||
Class B common shares - basic and diluted
|
$
|
1.64
|
$
|
0.75
|
$
|
1.41
|
||||||
Weighted-average shares outstanding:
|
||||||||||||
Class A common shares - basic and diluted
|
2,175
|
2,175
|
2,175
|
|||||||||
Class B common shares - basic and diluted
|
9,698
|
9,491
|
9,240
|
|||||||||
Dividends paid per common share:
|
||||||||||||
Class A common shares
|
$
|
0.24
|
$
|
0.24
|
$
|
0.24
|
||||||
Class B common shares
|
$
|
0.28
|
$
|
0.28
|
$
|
0.28
|
||||||
See accompanying notes to consolidated financial statements.
|
BEL FUSE INC. AND SUBSIDIARIES
|
||||||||||||
(dollars in thousands)
|
||||||||||||
|
||||||||||||
|
||||||||||||
|
Year Ended December 31,
|
|||||||||||
|
2015
|
2014
|
2013
|
|||||||||
|
(Revised)
|
|||||||||||
|
||||||||||||
Net earnings
|
$
|
19,197
|
$
|
8,603
|
$
|
15,908
|
||||||
|
||||||||||||
Other comprehensive (loss) income:
|
||||||||||||
Currency translation adjustment, net of taxes of ($194), ($219) and $77
|
(9,954
|
)
|
(11,255
|
)
|
977
|
|||||||
Reclassification adjustment for gain (loss) on sale of marketable
|
||||||||||||
securities included in net earnings, net of tax of $-, $- and ($37)
|
-
|
-
|
(61
|
)
|
||||||||
Unrealized holding (losses) gains on marketable securities arising during
|
||||||||||||
the period, net of taxes of $5, $90 and $45
|
5
|
147
|
87
|
|||||||||
Change in unfunded SERP liability, net of taxes of $2, ($631) and
|
||||||||||||
$457, respectively
|
21
|
(1,485
|
)
|
1,069
|
||||||||
Other comprehensive (loss) income
|
(9,928
|
)
|
(12,593
|
)
|
2,072
|
|||||||
|
||||||||||||
Comprehensive income (loss)
|
$
|
9,269
|
$
|
(3,990
|
)
|
$
|
17,980
|
|||||
|
||||||||||||
|
||||||||||||
See accompanying notes to consolidated financial statements.
|
BEL FUSE INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||
(dollars in thousands)
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
|
Accumulated
|
|||||||||||||||||||||||
|
Other
|
Class A
|
Class B
|
Additional
|
||||||||||||||||||||
|
Retained
|
Comprehensive
|
Common
|
Common
|
Paid-In
|
|||||||||||||||||||
|
Total
|
Earnings
|
(Loss) Income
|
Stock
|
Stock
|
Capital
|
||||||||||||||||||
Balance at December 31, 2012
|
$
|
215,362
|
$
|
195,183
|
$
|
(1,427
|
)
|
$
|
217
|
$
|
937
|
$
|
20,452
|
|||||||||||
|
||||||||||||||||||||||||
Cash dividends declared on Class A common stock
|
(522
|
)
|
(522
|
)
|
||||||||||||||||||||
Cash dividends declared on Class B common stock
|
(2,576
|
)
|
(2,576
|
)
|
||||||||||||||||||||
Issuance of restricted common stock
|
-
|
16
|
(16
|
)
|
||||||||||||||||||||
Forfeiture of restricted common stock
|
-
|
(2
|
)
|
2
|
||||||||||||||||||||
Repurchase/retirement of Class B common stock
|
(3,356
|
)
|
(18
|
)
|
(3,338
|
)
|
||||||||||||||||||
Foreign currency translation adjustment, net of taxes of $77
|
977
|
977
|
||||||||||||||||||||||
Unrealized holding gains on marketable securities
|
||||||||||||||||||||||||
arising during the year, net of taxes of $45
|
87
|
87
|
||||||||||||||||||||||
Reclassification adjustment for unrealized holding
|
||||||||||||||||||||||||
gains included in net earnings, net of taxes of ($37)
|
(61
|
)
|
(61
|
)
|
||||||||||||||||||||
Reduction in APIC pool associated with tax
|
||||||||||||||||||||||||
deficiencies related to restricted stock awards
|
(65
|
)
|
(65
|
)
|
||||||||||||||||||||
Stock-based compensation expense
|
1,879
|
1,879
|
||||||||||||||||||||||
Change in unfunded SERP liability, net of taxes of $457
|
1,069
|
1,069
|
||||||||||||||||||||||
Net earnings
|
15,908
|
15,908
|
||||||||||||||||||||||
|
||||||||||||||||||||||||
Balance at December 31, 2013
|
$
|
228,702
|
$
|
207,993
|
$
|
645
|
$
|
217
|
$
|
933
|
$
|
18,914
|
||||||||||||
|
||||||||||||||||||||||||
Cash dividends declared on Class A common stock
|
(522
|
)
|
(522
|
)
|
||||||||||||||||||||
Cash dividends declared on Class B common stock
|
(2,665
|
)
|
(2,665
|
)
|
||||||||||||||||||||
Issuance of restricted common stock
|
-
|
38
|
(38
|
)
|
||||||||||||||||||||
Forfeiture of restricted common stock
|
-
|
(2
|
)
|
2
|
||||||||||||||||||||
Foreign currency translation adjustment, net of taxes of ($219)
|
(11,255
|
)
|
(11,255
|
)
|
||||||||||||||||||||
Unrealized holding gains on marketable securities
|
||||||||||||||||||||||||
arising during the year, net of taxes of $90
|
147
|
147
|
||||||||||||||||||||||
Increase in APIC pool associated with tax
|
||||||||||||||||||||||||
benefits related to restricted stock awards
|
31
|
31
|
||||||||||||||||||||||
Stock-based compensation expense
|
2,717
|
2,717
|
||||||||||||||||||||||
Change in unfunded SERP liability, net of taxes of ($631)
|
(1,485
|
)
|
(1,485
|
)
|
||||||||||||||||||||
Net earnings
|
8,603
|
8,603
|
||||||||||||||||||||||
|
||||||||||||||||||||||||
Balance at December 31, 2014 (Revised)
|
$
|
224,273
|
$
|
213,409
|
$
|
(11,948
|
)
|
$
|
217
|
$
|
969
|
$
|
21,626
|
|||||||||||
|
||||||||||||||||||||||||
Cash dividends declared on Class A common stock
|
(522
|
)
|
(522
|
)
|
||||||||||||||||||||
Cash dividends declared on Class B common stock
|
(2,713
|
)
|
(2,713
|
)
|
||||||||||||||||||||
Issuance of restricted common stock
|
-
|
8
|
(8
|
)
|
||||||||||||||||||||
Forfeiture of restricted common stock
|
-
|
(7
|
)
|
7
|
||||||||||||||||||||
Foreign currency translation adjustment, net of taxes of ($194)
|
(9,954
|
)
|
(9,954
|
)
|
||||||||||||||||||||
Unrealized holding gains on marketable securities
|
||||||||||||||||||||||||
arising during the year, net of taxes of $5
|
5
|
5
|
||||||||||||||||||||||
Increase in APIC pool associated with tax
|
||||||||||||||||||||||||
benefits related to restricted stock awards
|
0
|
|||||||||||||||||||||||
Stock-based compensation expense
|
2,815
|
2,815
|
||||||||||||||||||||||
Change in unfunded SERP liability, net of taxes of $2
|
21
|
21
|
||||||||||||||||||||||
Net earnings
|
19,197
|
19,197
|
||||||||||||||||||||||
|
||||||||||||||||||||||||
Balance at December 31, 2015
|
$
|
233,122
|
$
|
229,371
|
$
|
(21,876
|
)
|
$
|
217
|
$
|
970
|
$
|
24,440
|
|||||||||||
|
||||||||||||||||||||||||
See accompanying notes to consolidated financial statements.
|
BEL FUSE INC. AND SUBSIDIARIES
|
||||||||||||
(dollars in thousands)
|
||||||||||||
|
||||||||||||
|
Years Ended December 31,
|
|||||||||||
|
2015
|
2014
|
2013
|
|||||||||
|
(Revised)
|
|||||||||||
Cash flows from operating activities:
|
||||||||||||
Net earnings
|
$
|
19,197
|
$
|
8,603
|
$
|
15,908
|
||||||
Adjustments to reconcile net earnings to net cash
|
||||||||||||
provided by operating activities:
|
||||||||||||
Depreciation and amortization
|
23,009
|
20,367
|
12,382
|
|||||||||
Stock-based compensation
|
2,815
|
2,717
|
1,879
|
|||||||||
Amortization of deferred financing costs
|
1,432
|
699
|
-
|
|||||||||
Deferred income taxes
|
(356
|
)
|
(2,691
|
)
|
(877
|
)
|
||||||
Other, net
|
(1,419
|
)
|
(3,651
|
)
|
407
|
|||||||
Changes in operating assets and liabilities:
|
||||||||||||
Accounts receivable
|
12,187
|
1,382
|
(8,025
|
)
|
||||||||
Inventories
|
12,951
|
9,121
|
(6,538
|
)
|
||||||||
Other current assets
|
846
|
693
|
1,702
|
|||||||||
Other assets
|
2,161
|
(450
|
)
|
(62
|
)
|
|||||||
Accounts payable
|
(10,022
|
)
|
(3,890
|
)
|
1,485
|
|||||||
Accrued expenses
|
(3,154
|
)
|
(10,170
|
)
|
(7,670
|
)
|
||||||
Other liabilities
|
(295
|
)
|
423
|
165
|
||||||||
Income taxes payable
|
6,437
|
(696
|
)
|
(175
|
)
|
|||||||
Net cash provided by operating activities
|
65,789
|
22,457
|
10,581
|
|||||||||
|
||||||||||||
Cash flows from investing activities:
|
||||||||||||
Purchase of property, plant and equipment
|
(9,891
|
)
|
(9,042
|
)
|
(6,940
|
)
|
||||||
Purchase of intangible asset
|
-
|
(1,336
|
)
|
|||||||||
Purchase of marketable securities
|
-
|
(2,936
|
)
|
-
|
||||||||
Purchase of company-owned life insurance
|
(2,820
|
)
|
(2,820
|
)
|
(2,820
|
)
|
||||||
Cash transferred from (to) restricted cash
|
-
|
-
|
12,993
|
|||||||||
Payments for acquisitions, net of cash acquired
|
-
|
(208,693
|
)
|
(30,994
|
)
|
|||||||
Proceeds from cash surrender of COLI policies
|
-
|
5,756
|
-
|
|||||||||
Proceeds from sale of marketable securities
|
2,820
|
-
|
2,820
|
|||||||||
Proceeds from disposal/sale of property, plant and equipment
|
77
|
65
|
96
|
|||||||||
Net cash used in investing activities
|
(9,814
|
)
|
(217,670
|
)
|
(26,181
|
)
|
||||||
|
||||||||||||
(continued)
|
||||||||||||
|
||||||||||||
See notes to consolidated financial statements.
|
BEL FUSE INC. AND SUBSIDIARIES
|
||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
|
||||||||||||
(dollars in thousands)
|
||||||||||||
|
||||||||||||
|
Year Ended December 31,
|
|||||||||||
|
2015
|
2014
|
2013
|
|||||||||
|
(Revised)
|
|||||||||||
Cash flows from financing activities:
|
||||||||||||
Dividends paid to common shareholders
|
(3,238
|
)
|
(3,160
|
)
|
(3,111
|
)
|
||||||
Deferred financing costs
|
(15
|
)
|
(5,756
|
)
|
-
|
|||||||
Borrowings under revolving credit line
|
12,500
|
23,000
|
12,000
|
|||||||||
Repayments under revolving credit line
|
(35,500
|
)
|
(12,000
|
)
|
-
|
|||||||
(Reduction) increase in notes payable
|
(123
|
)
|
(161
|
)
|
506
|
|||||||
Proceeds from long-term debt
|
-
|
215,000
|
-
|
|||||||||
Repayments of long-term debt
|
(22,438
|
)
|
(5,375
|
)
|
-
|
|||||||
Purchase and retirement of Class B common stock
|
-
|
-
|
(3,356
|
)
|
||||||||
Net cash (used in) provided by financing activities
|
(48,814
|
)
|
211,548
|
6,039
|
||||||||
Effect of exchange rate changes on cash
|
741
|
(1,320
|
)
|
422
|
||||||||
|
||||||||||||
Net increase (decrease) in cash and cash equivalents
|
7,902
|
15,015
|
(9,139
|
)
|
||||||||
|
||||||||||||
Cash and cash equivalents - beginning of year
|
77,138
|
62,123
|
71,262
|
|||||||||
|
||||||||||||
Cash and cash equivalents - end of year
|
$
|
85,040
|
$
|
77,138
|
$
|
62,123
|
||||||
|
||||||||||||
|
||||||||||||
Supplemental cash flow information:
|
||||||||||||
|
||||||||||||
Cash paid (received) during the year for:
|
||||||||||||
Income taxes, net of refunds received
|
$
|
580
|
$
|
4,686
|
$
|
(474
|
)
|
|||||
Interest payments
|
$
|
6,153
|
$
|
3,210
|
$
|
156
|
||||||
|
||||||||||||
Details of acquisition (see Note 2):
|
||||||||||||
Fair value of identifiable net assets acquired
|
$
|
-
|
$
|
130,747
|
$
|
34,541
|
||||||
Goodwill
|
-
|
105,402
|
4,812
|
|||||||||
Fair value of net assets acquired
|
$
|
-
|
$
|
236,149
|
$
|
39,353
|
||||||
|
||||||||||||
Fair value of consideration transferred
|
$
|
-
|
$
|
236,149
|
$
|
39,353
|
||||||
Less: Cash acquired in acquisition
|
-
|
(27,456
|
)
|
(8,359
|
)
|
|||||||
Cash paid for acquisition, net of cash acquired
|
$
|
-
|
$
|
208,693
|
$
|
30,994
|
||||||
See notes to consolidated financial statements.
|
2015
|
2014
|
2013
|
||||||||||
Numerator:
|
||||||||||||
Net earnings
|
$
|
19,197
|
$
|
8,603
|
$
|
15,908
|
||||||
Less dividends declared:
|
||||||||||||
Class A
|
522
|
522
|
522
|
|||||||||
Class B
|
2,713
|
2,665
|
2,576
|
|||||||||
Undistributed earnings
|
$
|
15,962
|
$
|
5,416
|
$
|
12,810
|
||||||
Undistributed earnings allocation - basic and diluted:
|
||||||||||||
Class A undistributed earnings
|
$
|
2,809
|
$
|
970
|
$
|
2,346
|
||||||
Class B undistributed earnings
|
13,153
|
4,446
|
10,464
|
|||||||||
Total undistributed earnings
|
$
|
15,962
|
$
|
5,416
|
$
|
12,810
|
||||||
Net earnings allocation - basic and diluted:
|
||||||||||||
Class A net earnings
|
$
|
3,331
|
$
|
1,492
|
$
|
2,868
|
||||||
Class B net earnings
|
15,866
|
7,111
|
13,040
|
|||||||||
Net earnings
|
$
|
19,197
|
$
|
8,603
|
$
|
15,908
|
||||||
Denominator:
|
||||||||||||
Weighted average shares outstanding:
|
||||||||||||
Class A - basic and diluted
|
2,175
|
2,175
|
2,175
|
|||||||||
Class B - basic and diluted
|
9,698
|
9,491
|
9,240
|
|||||||||
Net earnings per share:
|
||||||||||||
Class A - basic and diluted
|
$
|
1.53
|
$
|
0.69
|
$
|
1.32
|
||||||
Class B - basic and diluted
|
$
|
1.64
|
$
|
0.75
|
$
|
1.41
|
2.
|
ACQUISITIONS AND DISPOSITION
|
Power Solutions
|
Connectivity Solutions
|
2014 Acquisitions
|
||||||||||||||||||||||||||||
June 19, 2014
|
July 25, 2014/
|
|||||||||||||||||||||||||||||
(As Reported at
|
Measurement
|
June 19,
|
August 29, 2014(a)
|
Measurement
|
July 25, 2014/
|
Acquisition-Date
|
||||||||||||||||||||||||
December 31,
|
Period
|
2014
|
(As Reported at
|
Period
|
August 29, 2014
|
Fair Values
|
||||||||||||||||||||||||
2014)
|
|
Adjustments
|
(Revised)
|
December 31, 2014)
|
Adjustments
|
(Revised)
|
(Revised)
|
|||||||||||||||||||||||
Cash
|
$
|
20,912
|
$
|
-
|
$
|
20,912
|
$
|
6,544
|
$
|
-
|
$
|
6,544
|
$
|
27,456
|
||||||||||||||||
Accounts receivable
|
29,389
|
-
|
29,389
|
9,375
|
-
|
9,375
|
38,764
|
|||||||||||||||||||||||
Inventories
|
36,429
|
-
|
36,429
|
17,632
|
-
|
17,632
|
54,061
|
|||||||||||||||||||||||
Other current assets
|
7,350
|
-
|
7,350
|
2,615
|
(1,761
|
)
|
(c)
|
854
|
8,204
|
|||||||||||||||||||||
Property, plant and equipment
|
28,175
|
(1,060
|
)
|
(b)
|
27,115
|
9,900
|
-
|
9,900
|
37,015
|
|||||||||||||||||||||
Intangible assets
|
33,220
|
-
|
33,220
|
40,000
|
-
|
40,000
|
73,220
|
|||||||||||||||||||||||
Other assets
|
19,171
|
-
|
19,171
|
2,345
|
2,388
|
(c)
|
4,733
|
23,904
|
||||||||||||||||||||||
Total identifiable assets
|
174,646
|
(1,060
|
)
|
173,586
|
88,411
|
627
|
89,038
|
262,624
|
||||||||||||||||||||||
Accounts payable
|
(26,180
|
)
|
-
|
(26,180
|
)
|
(10,682
|
)
|
-
|
(10,682
|
)
|
(36,862
|
)
|
||||||||||||||||||
Accrued expenses
|
(25,545
|
)
|
-
|
(25,545
|
)
|
(5,307
|
)
|
76
|
(5,231
|
)
|
(30,776
|
)
|
||||||||||||||||||
Other current liabilities
|
223
|
-
|
223
|
(57
|
)
|
946
|
(c)
|
889
|
1,112
|
|||||||||||||||||||||
Noncurrent liabilities
|
(42,062
|
)
|
(4,623
|
)
|
(c)
|
(46,685
|
)
|
(17,314
|
)
|
(1,352
|
)
|
(c)
|
(18,666
|
)
|
(65,351
|
)
|
||||||||||||||
Total liabilities assumed
|
(93,564
|
)
|
(4,623
|
)
|
(98,187
|
)
|
(33,360
|
)
|
(330
|
)
|
(33,690
|
)
|
(131,877
|
)
|
||||||||||||||||
Net identifiable assets acquired
|
81,082
|
(5,683
|
)
|
75,399
|
55,051
|
297
|
55,348
|
130,747
|
||||||||||||||||||||||
Goodwill
|
49,710
|
5,683
|
55,393
|
50,306
|
(297
|
)
|
50,009
|
105,402
|
||||||||||||||||||||||
Net assets acquired
|
$
|
130,792
|
$
|
-
|
$
|
130,792
|
$
|
105,357
|
$
|
-
|
$
|
105,357
|
$
|
236,149
|
||||||||||||||||
Cash paid
|
$
|
130,792
|
$
|
-
|
$
|
130,792
|
$
|
105,357
|
$
|
-
|
$
|
105,357
|
$
|
236,149
|
||||||||||||||||
Assumption of liability
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||
Fair value of consideration
|
||||||||||||||||||||||||||||||
transferred
|
130,792
|
-
|
130,792
|
105,357
|
-
|
105,357
|
236,149
|
|||||||||||||||||||||||
Deferred consideration
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||
Total consideration paid
|
$
|
130,792
|
$
|
-
|
$
|
130,792
|
$
|
105,357
|
$
|
-
|
$
|
105,357
|
$
|
236,149
|
(a)
|
The Company acquired the U.S. and U.K. entities of Connectivity Solutions on July 25, 2014 and the China entity of Connectivity Solutions on August 29, 2014. These values represent the fair values as of the respective acquisition dates.
|
(b)
|
Represents the purchase accounting adjustments reflecting the finalization of the acquisition-date fair values of property, plant and equipment associated with completion of third-party valuations.
|
(c)
|
Primarily represents the impact to deferred taxes reflecting the finalization of the allocation of identifiable intangible assets acquired.
|
Year Ended
|
||||||||
December 31,
|
||||||||
2014
|
2013
|
|||||||
Revenue
|
$
|
629,132
|
$
|
710,937
|
||||
Net earnings
|
11,705
|
(65,299
|
)
|
|||||
Earnings per Class A common share - basic and diluted
|
0.94
|
(5.52
|
)
|
|||||
Earnings per Class B common share - basic and diluted
|
1.02
|
(5.77
|
)
|
3.
|
RESTRUCTURING ACTIVITIES
|
|
2014
|
2015
|
||||||||||||||||||||||||||
|
Liability at
|
Cash Payments
|
Liability at
|
Cash Payments
|
Liability at
|
|||||||||||||||||||||||
|
December 31,
|
New
|
and Other
|
December 31,
|
New
|
and Other
|
December 31,
|
|||||||||||||||||||||
|
2013
|
Charges
|
Settlements
|
2014
|
Charges
|
Settlements
|
2015
|
|||||||||||||||||||||
Severance costs
|
$
|
-
|
$
|
1,778
|
$
|
(1,778
|
)
|
$
|
-
|
$
|
1,144
|
$
|
(1,034
|
)
|
$
|
110
|
||||||||||||
Other restructuring costs
|
-
|
54
|
(54
|
)
|
-
|
626
|
(626
|
)
|
-
|
|||||||||||||||||||
Total
|
$
|
-
|
$
|
1,832
|
$
|
(1,832
|
)
|
$
|
-
|
$
|
1,770
|
$
|
(1,660
|
)
|
$
|
110
|
4.
|
GOODWILL AND OTHER INTANGIBLE ASSETS
|
|
Total
|
North America
|
Asia
|
Europe
|
||||||||||||
|
||||||||||||||||
Balance at January 1, 2014
|
||||||||||||||||
Goodwill, gross
|
45,431
|
18,865
|
14,107
|
12,459
|
||||||||||||
Accumulated impairment charges
|
(26,941
|
)
|
(14,066
|
)
|
(12,875
|
)
|
-
|
|||||||||
Goodwill, net
|
$
|
18,490
|
$
|
4,799
|
$
|
1,232
|
$
|
12,459
|
||||||||
|
||||||||||||||||
Goodwill allocation related to acquisitions
|
100,812
|
51,011
|
36,155
|
13,646
|
||||||||||||
Measurement period adjustments
|
(496
|
)
|
(496
|
)
|
-
|
-
|
||||||||||
Foreign currency translation
|
(437
|
)
|
-
|
(210
|
)
|
(227
|
)
|
|||||||||
|
||||||||||||||||
Balance at December 31, 2014:
|
||||||||||||||||
Goodwill, gross
|
145,310
|
69,380
|
50,052
|
25,878
|
||||||||||||
Accumulated impairment charges
|
(26,941
|
)
|
(14,066
|
)
|
(12,875
|
)
|
-
|
|||||||||
Goodwill, net
|
$
|
118,369
|
$
|
55,314
|
$
|
37,177
|
$
|
25,878
|
||||||||
|
||||||||||||||||
Measurement period adjustments
|
4,590
|
(6,016
|
)
|
4,351
|
6,255
|
|||||||||||
Foreign currency translation
|
(1,325
|
)
|
-
|
129
|
|
(1,454
|
)
|
|||||||||
|
||||||||||||||||
Balance at December 31, 2015:
|
||||||||||||||||
Goodwill, gross
|
148,575
|
63,364
|
54,532
|
30,679
|
||||||||||||
Accumulated impairment charges
|
(26,941
|
)
|
(14,066
|
)
|
(12,875
|
)
|
-
|
|||||||||
Goodwill, net
|
$
|
121,634
|
$
|
49,298
|
$
|
41,657
|
$
|
30,679
|
Reporting Unit
|
% by Which Estimated Fair Value Exceeds Carrying Value
|
|||
North America
|
11.4
|
%
|
||
Asia
|
20.2
|
%
|
||
Europe
|
18.4
|
%
|
December 31, 2015
|
December 31, 2014
|
|||||||||||||||||||||||
Gross Carrying
|
Accumulated
|
Net Carrying
|
Gross Carrying
|
Accumulated
|
Net Carrying
|
|||||||||||||||||||
Amount
|
Amortization
|
Amount
|
Amount
|
Amortization
|
Amount
|
|||||||||||||||||||
Patents, licenses and technology
|
$
|
39,388
|
$
|
7,932
|
$
|
31,456
|
$
|
38,872
|
$
|
4,297
|
$
|
34,575
|
||||||||||||
Customer relationships
|
44,894
|
5,735
|
39,159
|
45,836
|
3,062
|
42,774
|
||||||||||||||||||
Non-compete agreements
|
2,753
|
1,838
|
915
|
2,781
|
1,050
|
1,731
|
||||||||||||||||||
Trademarks
|
16,338
|
41
|
16,297
|
16,624
|
202
|
16,422
|
||||||||||||||||||
$
|
103,373
|
$
|
15,546
|
$
|
87,827
|
$
|
104,113
|
$
|
8,611
|
$
|
95,502
|
December 31,
|
Amortization Expense
|
|||
2016
|
$
|
6,759
|
||
2017
|
6,325
|
|||
2018
|
6,084
|
|||
2019
|
6,084
|
|||
2020
|
6,052
|
5.
|
FAIR VALUE MEASUREMENTS
|
6.
|
OTHER ASSETS
|
7.
|
INVENTORIES
|
December 31,
|
||||||||
2015
|
2014
|
|||||||
Raw materials
|
$
|
42,036
|
$
|
51,638
|
||||
Work in progress
|
16,908
|
16,128
|
||||||
Finished goods
|
39,566
|
45,864
|
||||||
Inventories
|
$
|
98,510
|
$
|
113,630
|
8.
|
PROPERTY, PLANT AND EQUIPMENT, NET
|
December 31,
|
||||||||
2015
|
2014
|
|||||||
Land
|
$
|
2,240
|
$
|
3,293
|
||||
Buildings and improvements
|
29,346
|
31,067
|
||||||
Machinery and equipment
|
116,921
|
117,178
|
||||||
Construction in progress
|
4,949
|
4,764
|
||||||
153,456
|
156,302
|
|||||||
Accumulated depreciation
|
(95,845
|
)
|
(87,041
|
)
|
||||
Property, plant and equipment, net
|
$
|
57,611
|
$
|
69,261
|
2015
|
2014
|
2013
|
||||||||||
Liability for uncertain tax positions - January 1
|
$
|
39,970
|
$
|
2,189
|
$
|
2,711
|
||||||
Additions based on tax positions
|
||||||||||||
related to the current year
|
3,241
|
2,732
|
28
|
|||||||||
Additions relating to acquisitions
|
-
|
35,874
|
-
|
|||||||||
Translation adjustment
|
(844
|
)
|
-
|
-
|
||||||||
Settlement/expiration of statutes of limitations
|
(209
|
)
|
(825
|
)
|
(550
|
)
|
||||||
Liability for uncertain tax positions - December 31
|
$
|
42,158
|
$
|
39,970
|
$
|
2,189
|
Years Ended December 31,
|
||||||||||||
2015
|
2014
|
2013
|
||||||||||
Current:
|
||||||||||||
Federal
|
$
|
1,494
|
$
|
402
|
$
|
(1,099
|
)
|
|||||
Foreign
|
5,327
|
3,281
|
1,120
|
|||||||||
State
|
70
|
175
|
113
|
|||||||||
6,891
|
3,858
|
134
|
||||||||||
Deferred:
|
||||||||||||
Federal
|
1,019
|
(2,698
|
)
|
(865
|
)
|
|||||||
State
|
(64
|
)
|
(407
|
)
|
65
|
|||||||
Foreign
|
(1,311
|
)
|
414
|
(77
|
)
|
|||||||
(356
|
)
|
(2,691
|
)
|
(877
|
)
|
|||||||
$
|
6,535
|
$
|
1,167
|
$
|
(743
|
)
|
Years Ended December 31,
|
||||||||||||||||||||||||
2015
|
2014
|
2013
|
||||||||||||||||||||||
$
|
|
%
|
$
|
|
%
|
$
|
|
%
|
||||||||||||||||
Tax provision computed at the
|
||||||||||||||||||||||||
federal statutory rate
|
$
|
9,006
|
35
|
%
|
$
|
3,420
|
35
|
%
|
$
|
5,309
|
35
|
%
|
||||||||||||
Increase (decrease) in taxes resulting from:
|
||||||||||||||||||||||||
Different tax rates applicable to foreign operations
|
(5,353
|
)
|
(21
|
%)
|
(4,458
|
)
|
(46
|
%)
|
(4,677
|
)
|
(31
|
%)
|
||||||||||||
Increase in (reversal of) liability for uncertain
|
||||||||||||||||||||||||
tax positions - net
|
3,032
|
12
|
%
|
1,907
|
20
|
%
|
(522
|
)
|
(3
|
%)
|
||||||||||||||
Utilization of research and experimentation, solar and foreign
|
||||||||||||||||||||||||
tax credits
|
(349
|
)
|
(1
|
%)
|
(508
|
)
|
(5
|
%)
|
(1,049
|
)
|
(7
|
%)
|
||||||||||||
State taxes, net of federal benefit
|
56
|
0
|
%
|
(183
|
)
|
(2
|
%)
|
117
|
1
|
%
|
||||||||||||||
Current year (reversal) increase in U.S. valuation allowances
|
(343
|
)
|
(1
|
%)
|
335
|
3
|
%
|
49
|
0
|
%
|
||||||||||||||
Federal tax on profit of foreign disregarded entities
|
||||||||||||||||||||||||
net of deferred tax
|
872
|
3
|
%
|
770
|
8
|
%
|
-
|
0
|
%
|
|||||||||||||||
Other, including qualified production activity credits, SERP/COLI
|
||||||||||||||||||||||||
income, under/(over) accruals, unrealized foreign exchange gains
|
||||||||||||||||||||||||
and amortization of purchase accounting intangibles
|
(386
|
)
|
(2
|
%)
|
(116
|
)
|
(1
|
%)
|
30
|
0
|
%
|
|||||||||||||
Tax (benefit) provision computed at the Company's
|
||||||||||||||||||||||||
effective tax rate
|
$
|
6,535
|
25
|
%
|
$
|
1,167
|
12
|
%
|
$
|
(743
|
)
|
(5
|
%)
|
December 31,
|
||||||||
2015
|
2014
|
|||||||
Tax Effect
|
Tax Effect
|
|||||||
(Revised)
|
||||||||
Deferred tax assets:
|
||||||||
State tax credits
|
$
|
902
|
$
|
954
|
||||
Unfunded pension liability
|
1,327
|
1,301
|
||||||
Reserves and accruals
|
4,349
|
2,095
|
||||||
Federal, state and foreign net operating loss
|
||||||||
and credit carryforwards
|
10,953
|
15,361
|
||||||
Depreciation
|
880
|
962
|
||||||
Amortization
|
814
|
995
|
||||||
Acquired deferred taxes
|
-
|
10,775
|
||||||
Other accruals
|
9,622
|
3,253
|
||||||
Total deferred tax assets
|
28,847
|
35,696
|
||||||
Deferred tax liabilities:
|
||||||||
Reserves and accruals
|
64
|
68
|
||||||
Depreciation
|
2,391
|
707
|
||||||
Amortization
|
23,772
|
21,062
|
||||||
Acquired deferred taxes
|
-
|
8,053
|
||||||
Other accruals
|
857
|
1,522
|
||||||
Total deferred tax liabilities
|
27,084
|
31,412
|
||||||
Valuation allowance
|
6,635
|
6,692
|
||||||
Net deferred tax assets/(liabilities)
|
$
|
(4,872
|
)
|
$
|
(2,408
|
)
|
10.
|
DEBT
|
2016(1)
|
$
|
24,772
|
||
2017
|
18,813
|
|||
2018
|
24,188
|
|||
2019
|
119,415
|
|||
Total long-term debt
|
187,188
|
|||
Less: Current maturities of long-term debt
|
(24,772
|
)
|
||
Noncurrent portion of long-term debt
|
$
|
162,416
|
|
Year Ended December 31,
|
|||||||
|
2015
|
2014
|
||||||
Sales commissions
|
$
|
2,824
|
$
|
3,017
|
||||
Subcontracting labor
|
1,942
|
2,217
|
||||||
Salaries, bonuses and related benefits
|
15,672
|
17,964
|
||||||
Warranty accrual
|
3,659
|
6,032
|
||||||
Other
|
14,226
|
13,358
|
||||||
|
$
|
38,323
|
$
|
42,588
|
|
Year Ended December 31,
|
|||||||
|
2015
|
2014
|
||||||
Balance, beginning of year
|
$
|
6,032
|
$
|
-
|
||||
Warranty accruals acquired in 2014 Acquisitions
|
-
|
4,397
|
||||||
Charges and costs accrued
|
2,892
|
3,834
|
||||||
Adjustments related to pre-existing warranties
|
||||||||
(including changes in estimates)
|
(1,208
|
)
|
(66
|
)
|
||||
Less: Repair costs incurred
|
(2,932
|
)
|
(2,061
|
)
|
||||
Less: Cash settlements
|
(1,000
|
)
|
-
|
|||||
Currency translation
|
(125
|
)
|
(72
|
)
|
||||
Balance, end of year
|
$
|
3,659
|
$
|
6,032
|
2015
|
2014
|
2013
|
||||||||||
Net Sales to External Customers:
|
||||||||||||
North America
|
$
|
304,328
|
$
|
217,258
|
$
|
116,548
|
||||||
Asia
|
188,146
|
201,338
|
193,647
|
|||||||||
Europe
|
74,606
|
68,480
|
38,994
|
|||||||||
$
|
567,080
|
$
|
487,076
|
$
|
349,189
|
|||||||
Net Sales:
|
||||||||||||
North America
|
$
|
329,304
|
$
|
248,007
|
$
|
128,472
|
||||||
Asia
|
295,751
|
275,765
|
225,151
|
|||||||||
Europe
|
148,735
|
114,748
|
40,742
|
|||||||||
Less intercompany
|
||||||||||||
net sales
|
(206,710
|
)
|
(151,444
|
)
|
(45,176
|
)
|
||||||
$
|
567,080
|
$
|
487,076
|
$
|
349,189
|
|||||||
Income (Loss) from Operations:
|
||||||||||||
North America
|
$
|
11,012
|
$
|
(4,531
|
)
|
$
|
(1,560
|
)
|
||||
Asia
|
8,175
|
13,090
|
15,356
|
|||||||||
Europe
|
9,413
|
4,913
|
1,251
|
|||||||||
$
|
28,600
|
$
|
13,472
|
$
|
15,047
|
|||||||
Total Assets:
|
||||||||||||
North America
|
$
|
247,436
|
$
|
314,565
|
$
|
117,261
|
||||||
Asia
|
231,063
|
251,240
|
148,780
|
|||||||||
Europe
|
108,512
|
69,616
|
42,100
|
|||||||||
$
|
587,011
|
$
|
635,421
|
$
|
308,141
|
|||||||
Capital Expenditures:
|
||||||||||||
North America
|
$
|
2,425
|
$
|
3,862
|
$
|
2,064
|
||||||
Asia
|
4,888
|
4,089
|
4,551
|
|||||||||
Europe
|
2,578
|
1,091
|
325
|
|||||||||
$
|
9,891
|
$
|
9,042
|
$
|
6,940
|
|||||||
Depreciation and Amortization Expense:
|
||||||||||||
North America
|
$
|
10,841
|
$
|
7,986
|
$
|
4,282
|
||||||
Asia
|
8,706
|
8,391
|
6,540
|
|||||||||
Europe
|
3,462
|
3,990
|
1,560
|
|||||||||
$
|
23,009
|
$
|
20,367
|
$
|
12,382
|
Year Ended
|
||||||||||||
December 31,
|
||||||||||||
2015
|
2014
|
2013
|
||||||||||
Net Sales to External Customers:
|
||||||||||||
North America:
|
||||||||||||
Power Solutions
|
$
|
131,215
|
$
|
73,530
|
$
|
-
|
||||||
Connectivity Solutions
|
57,903
|
28,242
|
-
|
|||||||||
Array (a)
|
4,729
|
6,842
|
2,074
|
|||||||||
193,847
|
108,614
|
2,074
|
||||||||||
Asia:
|
||||||||||||
Power Solutions
|
1,026
|
3,401
|
-
|
|||||||||
Connectivity Solutions
|
4,872
|
2,469
|
-
|
|||||||||
TRP
|
71,215
|
66,082
|
65,141
|
|||||||||
77,113
|
71,952
|
65,141
|
||||||||||
Europe:
|
||||||||||||
Power Solutions
|
28,685
|
23,882
|
-
|
|||||||||
Connectivity Solutions
|
6,634
|
2,812
|
-
|
|||||||||
TRP
|
2,700
|
2,498
|
1,407
|
|||||||||
38,019
|
29,192
|
1,407
|
||||||||||
Net sales from 2013-2014 acquisitions
|
308,979
|
209,758
|
68,622
|
|||||||||
Income (loss) from operations:
|
||||||||||||
North America:
|
||||||||||||
Power Solutions
|
2,320
|
(777
|
)
|
-
|
||||||||
Connectivity Solutions
|
2,803
|
(2,808
|
)
|
-
|
||||||||
Array (a)
|
(311
|
)
|
(801
|
)
|
(936
|
)
|
||||||
4,812
|
(4,386
|
)
|
(936
|
)
|
||||||||
Asia:
|
||||||||||||
Power Solutions
|
(2,074
|
)
|
(3,851
|
)
|
-
|
|||||||
Connectivity Solutions
|
(329
|
)
|
493
|
-
|
||||||||
TRP
|
9,269
|
13,152
|
9,007
|
|||||||||
6,866
|
9,794
|
9,007
|
||||||||||
Europe:
|
||||||||||||
Power Solutions
|
6,799
|
4,574
|
-
|
|||||||||
Connectivity Solutions
|
731
|
(168
|
)
|
-
|
||||||||
TRP
|
351
|
366
|
289
|
|||||||||
7,881
|
4,772
|
289
|
||||||||||
Total income (loss) from operations
|
||||||||||||
from 2013-2014 acquisitions
|
$
|
19,559
|
$
|
10,180
|
$
|
8,360
|
(a)
|
2015 net sales and loss from operations noted for Array reflect 2015 activity through September 30, 2015. Array was merged into the Company's Cinch Connector business during the fourth quarter of 2015.
|
|
2015
|
2014
|
2013
|
|||||||||
North America
|
$
|
1,452
|
$
|
1,539
|
$
|
963
|
||||||
Asia
|
352
|
-
|
249
|
|||||||||
Europe
|
310
|
293
|
175
|
|||||||||
|
$
|
2,114
|
$
|
1,832
|
$
|
1,387
|
|
2015
|
2014
|
2013
|
|||||||||
Net Sales by Geographic Location:
|
||||||||||||
|
||||||||||||
United States
|
$
|
304,328
|
$
|
217,258
|
$
|
116,548
|
||||||
Macao
|
182,248
|
195,469
|
193,647
|
|||||||||
United Kingdom
|
27,552
|
22,852
|
16,538
|
|||||||||
Germany
|
16,314
|
18,663
|
16,585
|
|||||||||
Switzerland
|
18,050
|
15,236
|
-
|
|||||||||
All other foreign countries
|
18,588
|
17,598
|
5,871
|
|||||||||
Consolidated net sales
|
$
|
567,080
|
$
|
487,076
|
$
|
349,189
|
||||||
|
||||||||||||
Net Sales by Major Product Line:
|
||||||||||||
|
||||||||||||
Power solutions and protection
|
$
|
214,766
|
$
|
159,867
|
$
|
67,370
|
||||||
Connectivity solutions
|
181,697
|
152,954
|
111,653
|
|||||||||
Magnetic solutions
|
170,617
|
174,255
|
170,166
|
|||||||||
Consolidated net sales
|
$
|
567,080
|
$
|
487,076
|
$
|
349,189
|
2015
|
2014
|
|||||||
Long-lived Assets by Geographic Location:
|
||||||||
United States
|
$
|
35,967
|
$
|
43,760
|
||||
People's Republic of China (PRC)
|
37,796
|
42,323
|
||||||
Slovakia
|
7,758
|
8,101
|
||||||
Switzerland
|
4,006
|
4,935
|
||||||
United Kingdom
|
2,016
|
2,537
|
||||||
All other foreign countries
|
1,232
|
1,305
|
||||||
Consolidated long-lived assets
|
$
|
88,775
|
$
|
102,961
|
2015
|
2014
|
2013
|
||||||||||
Service Cost
|
$
|
552
|
$
|
542
|
$
|
556
|
||||||
Interest Cost
|
567
|
541
|
448
|
|||||||||
Net amortization
|
366
|
182
|
307
|
|||||||||
Net periodic benefit cost
|
$
|
1,485
|
$
|
1,265
|
$
|
1,311
|
|
2015
|
2014
|
||||||
Fair value of plan assets, January 1
|
$
|
-
|
$
|
-
|
||||
Company contributions
|
85
|
16
|
||||||
Benefits paid
|
(85
|
)
|
(16
|
)
|
||||
Fair value of plan assets, December 31
|
$
|
-
|
$
|
-
|
||||
Benefit obligation, January 1
|
14,205
|
10,830
|
||||||
Service cost
|
552
|
542
|
||||||
Interest cost
|
567
|
541
|
||||||
Benefits paid
|
(85
|
)
|
(16
|
)
|
||||
Actuarial (gains) losses
|
337
|
2,308
|
||||||
Benefit obligation, December 31
|
$
|
15,576
|
$
|
14,205
|
||||
Underfunded status, December 31
|
$
|
(15,576
|
)
|
$
|
(14,205
|
)
|
Years Ending
|
||||
December 31,
|
||||
2016
|
$
|
129
|
||
2017
|
280
|
|||
2018
|
280
|
|||
2019
|
532
|
|||
2020
|
647
|
|||
2021 - 2025
|
4,662
|
2015
|
2014
|
|||||||
Prior service cost
|
$
|
866
|
$
|
1,048
|
||||
Net loss
|
3,465
|
3,302
|
||||||
$
|
4,331
|
$
|
4,350
|
|
2015
|
|
2014
|
|
2013
|
Net periodic benefit cost
|
|
|
|
|
|
Discount rate
|
4.00%
|
5.00%
|
4.00%
|
||
Rate of compensation increase
|
3.00%
|
3.00%
|
3.00%
|
||
Benefit obligation
|
|
|
|
|
|
Discount rate
|
4.25%
|
4.00%
|
5.00%
|
||
Rate of compensation increase
|
3.00%
|
|
3.00%
|
|
3.00%
|
|
Weighted Average
|
||||||||
Restricted Stock
|
Weighted Average
|
Remaining
|
|||||||
Awards
|
Shares
|
Award Price
|
Contractual Term
|
||||||
|
|
||||||||
Outstanding at January 1, 2015
|
643,275
|
$
|
21.52
|
3.8 years
|
|||||
Granted
|
84,000
|
23.05
|
|
||||||
Vested
|
(94,450
|
)
|
18.96
|
|
|||||
Forfeited
|
(68,800
|
)
|
22.99
|
|
|||||
Outstanding at December 31, 2015
|
564,025
|
$
|
22.00
|
3.2 years
|
Year Ending
|
||||
December 31,
|
||||
2016
|
$
|
7,924
|
||
2017
|
5,870
|
|||
2018
|
3,209
|
|||
2019
|
2,184
|
|||
2020
|
2,032
|
|||
Thereafter
|
2,211
|
|||
$
|
23,430
|
2015
|
2014
|
2013
|
||||||||||
Foreign currency translation adjustment
|
$
|
(19,305
|
)
|
$
|
(9,351
|
)
|
$
|
1,904
|
||||
Unrealized holding gain on available-for-sale
|
||||||||||||
securities, net of taxes of $265, $259 and $169 as of
|
||||||||||||
December 31, 2015, 2014 and 2013
|
434
|
429
|
282
|
|||||||||
Unfunded SERP liability, net of taxes of ($1,327), ($1,325)
|
||||||||||||
and ($693) as of December 31, 2015, 2014 and 2013
|
(3,005
|
)
|
(3,026
|
)
|
(1,541
|
)
|
||||||
Accumulated other comprehensive (loss) income
|
$
|
(21,876
|
)
|
$
|
(11,948
|
)
|
$
|
645
|
Unrealized Holding
|
|||||||||||||||||
Foreign Currency
|
Gains on
|
||||||||||||||||
Translation
|
Available-for-
|
Unfunded
|
|||||||||||||||
Adjustment
|
Sale Securities
|
SERP Liability
|
Total
|
||||||||||||||
Balance at January 1, 2014
|
1,904
|
282
|
(1,541
|
)
|
645
|
||||||||||||
Other comprehensive income (loss) before reclassifications
|
(11,255
|
)
|
147
|
(1,667
|
)
|
(12,775
|
)
|
||||||||||
Amounts reclassified from accumulated other
|
|||||||||||||||||
comprehensive income (loss)
|
-
|
-
|
182
|
(a)
|
182
|
||||||||||||
Net current period other comprehensive income (loss)
|
(11,255
|
)
|
147
|
(1,485
|
)
|
(12,593
|
)
|
||||||||||
Balance at December 31, 2014
|
$
|
(9,351
|
)
|
$
|
429
|
$
|
(3,026
|
)
|
$
|
(11,948
|
)
|
||||||
Other comprehensive income (loss) before reclassifications
|
(9,954
|
)
|
5
|
(233
|
)
|
(10,182
|
)
|
||||||||||
Amounts reclassified from accumulated other
|
|||||||||||||||||
comprehensive income (loss)
|
254
|
(a)
|
254
|
||||||||||||||
Net current period other comprehensive income (loss)
|
(9,954
|
)
|
5
|
21
|
(9,928
|
)
|
|||||||||||
Balance at December 31, 2015
|
$
|
(19,305
|
)
|
$
|
434
|
$
|
(3,005
|
)
|
$
|
(21,876
|
)
|
(a)
|
This reclassification relates to the amortization of prior service costs and gains/losses associated with the Company's SERP plan. This expense is allocated between cost of sales and selling, general and administrative expense based upon the employment classification of the plan participants.
|
|
2015
|
|||||||||||||||||
|
First
|
Second
|
Third
|
Fourth
|
||||||||||||||
|
Quarter(a)
|
Quarter
|
Quarter
|
Quarter
|
||||||||||||||
|
||||||||||||||||||
Net sales
|
$
|
142,015
|
$
|
145,658
|
$
|
144,161
|
$
|
135,246
|
||||||||||
|
||||||||||||||||||
Cost of sales
|
115,202
|
(a) |
117,098
|
116,749
|
109,203
|
|||||||||||||
|
||||||||||||||||||
Net earnings
|
5,320
|
(a) |
6,062
|
4,920
|
2,895
|
|||||||||||||
|
||||||||||||||||||
Net earnings per share:
|
||||||||||||||||||
Class A common share - basic and diluted
|
$
|
0.43
|
(a) |
$
|
0.49
|
$
|
0.39
|
$
|
0.23
|
|||||||||
Class B common share - basic and diluted
|
$
|
0.45
|
(a) |
$
|
0.52
|
$
|
0.42
|
$
|
0.25
|
|||||||||
|
||||||||||||||||||
|
||||||||||||||||||
|
||||||||||||||||||
2014 | ||||||||||||||||||
|
First
|
Second
|
Third
|
Fourth
|
||||||||||||||
|
Quarter
|
Quarter
|
Quarter
|
Quarter(b)
|
||||||||||||||
|
||||||||||||||||||
Net sales
|
$
|
82,646
|
$
|
99,439
|
$
|
156,341
|
$
|
148,650
|
||||||||||
|
||||||||||||||||||
Cost of sales
|
68,576
|
81,493
|
128,561
|
121,091
|
(b) | |||||||||||||
|
||||||||||||||||||
Net earnings
|
2,503
|
3,065
|
1,261
|
1,774
|
(b) | |||||||||||||
|
||||||||||||||||||
Earnings per share:
|
||||||||||||||||||
Class A common share - basic and diluted
|
$
|
0.20
|
$
|
0.25
|
$
|
0.10
|
$
|
0.14
|
(b) | |||||||||
Class B common share - basic and diluted
|
$
|
0.22
|
$
|
0.27
|
$
|
0.11
|
$
|
0.15
|
(b) |
(a)
|
Revised from 10-Q disclosures to reflect immaterial measurement period adjustments related to the 2014 Acquisitions. First quarter 10-Q reflected cost of sales of $114.9 million, net earnings of $5.6 million, earnings per Class A common share of $0.45 per share and earnings per Class B common share of $0.48 per share.
|
(b)
|
Revised from the disclosure in the Annual Report on Form 10-K for the year ended December 31, 2014 to reflect immaterial measurement period adjustments related to the 2014 Acquisitions. The 2014 10-K reflected, for the fourth quarter of 2014, cost of sales of $120.8 million, net earnings of $2.0 million, earnings per Class A common share of $0.16 per share and earnings per Class B common share of $0.17 per share.
|
BEL FUSE INC. AND SUBSIDIARIES
|
||||||||||||||||||||
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
|
||||||||||||||||||||
(Amounts in thousands)
|
||||||||||||||||||||
|
||||||||||||||||||||
Column A
|
Column B
|
Column C
|
Column D
|
Column E
|
||||||||||||||||
|
||||||||||||||||||||
|
Additions
|
|||||||||||||||||||
|
Balance at
|
(1)
|
|
(2)
|
|
Balance
|
||||||||||||||
|
beginning
|
Charged to costs
|
Charged to other
|
Deductions
|
at end
|
|||||||||||||||
Description
|
of period
|
and expenses
|
accounts (b)
|
(a)
|
of period
|
|||||||||||||||
Year ended December 31, 2015:
|
||||||||||||||||||||
Allowance for doubtful accounts
|
$
|
1,989
|
$
|
295
|
$
|
303
|
$
|
(840
|
)
|
$
|
1,747
|
|||||||||
Allowance for excess and obsolete inventory
|
$
|
6,809
|
$
|
2,186
|
$
|
(59
|
) |
$
|
(3,668
|
)
|
$
|
5,268
|
||||||||
Deferred tax assets - valuation allowances
|
$
|
6,692
|
$
|
456
|
$
|
-
|
$
|
(513
|
)
|
$
|
6,635
|
|||||||||
|
||||||||||||||||||||
Year ended December 31, 2014:
|
||||||||||||||||||||
Allowance for doubtful accounts
|
$
|
941
|
$
|
1,434
|
$
|
-
|
$
|
(386
|
)
|
$
|
1,989
|
|||||||||
Allowance for excess and obsolete inventory
|
$
|
3,941
|
$
|
4,438
|
$
|
(1
|
)
|
$
|
(1,569
|
)
|
$
|
6,809
|
||||||||
Deferred tax assets - valuation allowances
|
$
|
1,955
|
$
|
4,766
|
$
|
-
|
$
|
(29
|
)
|
$
|
6,692
|
|||||||||
|
||||||||||||||||||||
Year ended December 31, 2013:
|
||||||||||||||||||||
Allowance for doubtful accounts
|
$
|
743
|
$
|
325
|
$
|
50
|
$
|
(177
|
)
|
$
|
941
|
|||||||||
Allowance for excess and obsolete inventory
|
$
|
5,490
|
$
|
(85
|
)
|
$
|
7
|
$
|
(1,471
|
)
|
$
|
3,941
|
||||||||
Deferred tax assets - valuation allowances
|
$
|
1,874
|
$
|
308
|
$
|
-
|
$
|
(227
|
)
|
$
|
1,955
|
|||||||||
|
||||||||||||||||||||
(a) Write-offs
|
||||||||||||||||||||
|
||||||||||||||||||||
(b) Includes foreign currency translation adjustments
|
Plan Category
|
Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights
(a) |
Weighted Average Exercise Price of Outstanding Options, Warrants and Rights
(b) |
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))
(c) |
|||||||||
Equity compensation plans approved by security holders:
|
||||||||||||
2011 Equity Compensation Plan
|
-
|
$
|
-
|
750,600
|
||||||||
Equity compensation plans not approved by security holders
|
-
|
-
|
-
|
|||||||||
Totals
|
-
|
$
|
-
|
750,600
|
Exhibits, Financial Statement Schedules
(a) Documents filed as a part of this Annual Report on Form 10-K:
(1) Financial Statements
See Index to Consolidated Financial Statements and Schedule of this Form 10-K.
(2) Financial Statement Schedule
See Schedule II — Valuation and Qualifying Accounts — Years Ended December 31, 2015, 2014 and 2013 of this Annual Report on Form 10-K.
(3) Exhibits
|
|||
Exhibit No.:
|
|||
3.1
|
Restated Certificate of Incorporation, as amended, is incorporated by reference to (i) Restated Certificate of Incorporation filed as Exhibit 3.1 of the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1998 and (ii) Certificate of Amendment to the Company's Restated Certificate of Incorporation filed as Exhibit 3.1 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
|
||
3.2
|
By-laws, as amended and restated on May 13, 2014, are incorporated by reference to Exhibit 3.1 of the Company's Quarterly Report on Form 10-Q for the six months ended June 30, 2014.
|
||
10.1†
|
2002 Equity Compensation Program. Incorporated by reference to the Registrant's proxy statement for its 2002 annual meeting of shareholders.
|
||
10.2
|
Credit and Guaranty Agreement, dated as of February 12, 2007, by and among Bel Fuse Inc., as Borrower, the Subsidiary Guarantors party thereto and the Bank of America, N.A., as Lender. Filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 16, 2007 and incorporated herein by reference.
|
||
10.3†
|
Amended and Restated Bel Fuse Supplemental Executive Retirement Plan, dated as of April 17, 2007. Filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on April 23, 2007 and incorporated herein by reference.
|
||
10.4
|
Stock and Asset Purchase Agreement between Bel Fuse Inc. and Tyco Electronics Corporation, dated as of November 28, 2012. Filed as Exhibit 2.1 to the Company's Current Report on Form 8-K filed on December 4, 2012 and incorporated herein by reference.
|
||
10.5
|
First Amendment to Credit and Guaranty Agreement dated as of April 30, 2008, by and among Bel Fuse Inc., as Borrower, the Subsidiary Guarantors party thereto and the Bank of America, N.A., as Lender. Filed as Exhibit 10.6 to the Company's Annual Report on Form 10-K for the year ended December 31, 2009 and incorporated herein by reference.
|
||
10.6
|
Second Amendment to Credit and Guaranty Agreement dated as of June 30, 2009, by and among Bel Fuse Inc., as Borrower, the Subsidiary Guarantors party thereto and the Bank of America, N.A., as Lender. Filed as Exhibit 10.7 to the Company's Annual Report on Form 10-K for the year ended December 31, 2009 and incorporated herein by reference.
|
||
10.7
|
Third Amendment to Credit and Guaranty Agreement dated as of January 29, 2010, by and among Bel Fuse Inc., as Borrower, the Subsidiary Guarantors party thereto and the Bank of America, N.A., as Lender. Filed as Exhibit 10.9 to the Company's Annual Report on Form 10-K for the year ended December 31, 2009 and incorporated herein by reference.
|
||
10.8
|
Fourth Amendment to Credit and Guaranty Agreement dated as of September 27, 2010, by and among Bel Fuse Inc., as Borrower, the Subsidiary Guarantors party thereto and the Bank of America, N.A., as Lender. Filed as Exhibit 10.9 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011 and incorporated herein by reference.
|
10.9
|
Fifth Amendment to Credit and Guaranty Agreement dated as of February 16, 2011, by and among Bel Fuse Inc., as Borrower, the Subsidiary Guarantors party thereto and the Bank of America, N.A., as Lender. Filed as Exhibit 10.10 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011 and incorporated herein by reference.
|
||
10.10†
|
2011 Equity Compensation Program. Incorporated by reference to the Registrant's proxy statement for its 2011 annual meeting of shareholders.
|
||
10.11
|
Sixth Amendment to Credit and Guaranty Agreement dated as of November 8, 2013, by and among Bel Fuse Inc., as Borrower, the Subsidiary Guarantors party thereto and the Bank of America, N.A., as Lender. Filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the nine months ended September 30, 2013 and incorporated herein by reference.
|
||
10.12
|
Stock Purchase Agreement dated as of April 24, 2014, by and among Bel Fuse Inc., Power-One, Inc. and PWO Holdings B.V. Filed as Exhibit 2.1 to the Company's Quarterly Report on Form 10-Q for the three months ended March 31, 2014 and incorporated herein by reference.
|
||
10.13
|
Stock Purchase Agreement dated as of May 16, 2014, by and among Bel Fuse Inc. and Emerson Electric Co. Filed as Exhibit 2.1 to the Company's Current Report on Form 8-K filed on May 22, 2014 and incorporated herein by reference.
|
||
10.14
|
Credit and Security Agreement dated June 19, 2014, as amended and restated as of June 30, 2014, by and among Bel Fuse Inc., as Borrower, and KeyBank National Association, as Administrative Agent, Swing Line Lender and Issuing Lender, and the other lenders identified therein. Filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on July 7, 2014 and incorporated herein by reference.
|
||
11.1
|
A statement regarding the computation of earnings per share is omitted because such computation can be clearly determined from the material contained in this Annual Report on Form 10-K.
|
||
12.1*
|
Computation of Ratio of Earnings to Fixed Charges.
|
||
21.1*
|
Subsidiaries of the Registrant.
|
||
23.1*
|
Consent of Independent Registered Public Accounting Firm.
|
||
24.1*
|
Power of attorney (included on the signature page)
|
||
31.1*
|
Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
||
31.2*
|
Certification of the Vice President of Finance pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
||
32.1**
|
Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes - Oxley Act of 2002.
|
||
32.2**
|
Certification of the Vice-President of Finance pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
||
101.INS*
|
XBRL Instance Document
|
||
101.SCH*
|
XBRL Taxonomy Extension Schema Document
|
||
101.CAL*
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
||
101.DEF*
|
XBRL Taxonomy Extension Definition Linkbase Document
|
||
101.LAB*
|
XBRL Taxonomy Extension Label Linkbase Document
|
||
101.PRE*
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
By:
|
/s/ Daniel Bernstein
|
Daniel Bernstein
|
|
President and Chief Executive Officer
|
|
Dated: March 11, 2016
|
Signature
|
Title
|
Date
|
||
/s/ Daniel Bernstein
|
President, Chief Executive Officer
|
March 11, 2016
|
||
Daniel Bernstein
|
and Director
|
|||
/s/ Howard Bernstein
|
Director
|
March 11, 2016
|
||
Howard B. Bernstein
|
||||
/s/ Robert H. Simandl
|
Director
|
March 11, 2016
|
||
Robert H. Simandl
|
||||
/s/ Peter Gilbert
|
Director
|
March 11, 2016
|
||
Peter Gilbert
|
||||
/s/ John Tweedy
|
Director
|
March 11, 2016
|
||
John Tweedy
|
||||
/s/ John Johnson
|
Director
|
March 11, 2016
|
||
John Johnson
|
||||
/s/ Avi Eden
|
Director
|
March 11, 2016
|
||
Avi Eden
|
||||
/s/ Mark Segall
|
Director
|
March 11, 2016
|
||
Mark Segall
|
||||
/s/ Norman Yeung
|
Director
|
March 11, 2016
|
||
Norman Yeung
|
/s/ Eric Nowling
|
Director
|
March 11, 2016
|
||
Eric Nowling
|
||||
/s/ Colin Dunn
|
Vice President of Finance and Secretary
|
March 11, 2016
|
||
Colin Dunn
|
(Principal Financial Officer and Principal
|
|||
Accounting Officer)
|