|
|
Title of class:
|
|
Name of each exchange
on which registered:
|
Common Stock
|
|
New York Stock Exchange
|
Common Share Purchase Rights
|
|
New York Stock Exchange
|
Large accelerated filer
|
ý
|
|
Accelerated filer
|
¨
|
Non-accelerated filer
|
¨
|
|
Smaller reporting company
|
¨
|
•
|
the continued shift in the Company’s business from lower cost, manually read meters toward more expensive, value-added automatic meter reading (AMR) systems, advanced metering infrastructure (AMI) systems and advanced metering analytics (AMA) systems that offer more comprehensive solutions to customers’ metering needs;
|
•
|
the success or failure of newer Company products;
|
•
|
changes in competitive pricing and bids in both the domestic and foreign marketplaces, and particularly in continued intense price competition on government bid contracts for lower cost, manually read meters;
|
•
|
the actions (or lack thereof) of the Company’s competitors;
|
•
|
changes in the Company’s relationships with its alliance partners, primarily its alliance partners that provide radio solutions, and particularly those that sell products that do or may compete with the Company’s products;
|
•
|
changes in the general health of the United States and foreign economies, including to some extent such things as the length and severity of global economic downturns, international or civil conflicts that affect international trade, the ability of municipal water utility customers to authorize and finance purchases of the Company’s products, the Company’s ability to obtain financing, housing starts in the United States, and overall industrial activity;
|
•
|
unusual weather, weather patterns or other natural phenomena, including related economic and other ancillary effects of any such events;
|
•
|
economic policy changes, including but not limited to, trade policy and corporate taxation;
|
•
|
the timing and impact of government funding programs that stimulate national and global economies, as well as the impact of government budget cuts or partial shutdowns of governmental operations;
|
•
|
changes in the cost and/or availability of needed raw materials and parts, such as volatility in the cost of brass castings as a result of fluctuations in commodity prices, particularly for copper and scrap metal at the supplier level, foreign-sourced electronic components as a result of currency exchange fluctuations and/or lead times, and plastic resin as a result of changes in petroleum and natural gas prices;
|
•
|
the Company’s expanded role as a prime contractor for providing complete technology systems to governmental entities, which brings with it added risks, including but not limited to, the Company’s responsibility for subcontractor performance, additional costs and expenses if the Company and its subcontractors fail to meet the timetable agreed to with the governmental entity, and the Company’s expanded warranty and performance obligations;
|
•
|
the Company’s ability to successfully integrate acquired businesses or products;
|
•
|
changes in foreign economic conditions, particularly currency fluctuations in the United States dollar, the Euro and the Mexican peso;
|
•
|
the inability to develop technologically advanced products;
|
•
|
the failure of the Company’s products to operate as intended;
|
•
|
the inability to protect the Company’s proprietary rights to its products;
|
•
|
disruptions and other damages to information technology and other networks and operations due to breaches in data security or any other cybersecurity attack;
|
•
|
transportation delays or interruptions;
|
•
|
violations or alleged violations of the U.S. Foreign Corrupt Practices Act (FCPA) or other anti-corruption laws and the Foreign Account Tax Compliance provisions of the Hiring Incentives to Restore Employment Act (referred to as FATCA);
|
•
|
the loss of certain single-source suppliers; and
|
•
|
changes in laws and regulations, particularly laws dealing with the content or handling of materials used in the Company's products.
|
Name
|
Position
|
Age at
2/28/2017
|
Richard A. Meeusen
|
Chairman, President and Chief Executive Officer
|
62
|
Richard E. Johnson
|
Senior Vice President — Finance, Chief Financial Officer and Treasurer
|
62
|
Fred J. Begale
|
Vice President — Engineering
|
52
|
William R. A. Bergum
|
Vice President — General Counsel and Secretary
|
52
|
Gregory M. Gomez
|
Vice President — Flow Instrumentation
|
52
|
Horst E. Gras
|
Vice President — International Operations
|
61
|
Trina L. Jashinsky
|
Vice President — Human Resources
|
54
|
Raymond G. Serdynski
|
Vice President — Manufacturing
|
60
|
Beverly L. P. Smiley
|
Vice President — Controller
|
67
|
Kimberly K. Stoll
|
Vice President — Sales and Marketing
|
50
|
|
|
|
|
Approximate area
|
|
||
Location
|
|
Principal use
|
|
(square feet)
|
|
||
Scottsdale, Arizona, USA
|
|
Manufacturing and offices
|
|
32,000
|
|
(1
|
)
|
Los Gatos, California, USA
|
|
Software development and offices
|
|
3,600
|
|
(2
|
)
|
Centennial, Colorado, USA
|
|
Distribution and offices
|
|
12,000
|
|
|
|
Tulsa, Oklahoma, USA
|
|
Manufacturing and offices
|
|
59,500
|
|
|
|
Milwaukee, Wisconsin, USA
|
|
Manufacturing and offices
|
|
324,200
|
|
|
|
Racine, Wisconsin, USA
|
|
Manufacturing and offices
|
|
134,300
|
|
(3
|
)
|
Brno, Czech Republic
|
|
Manufacturing and offices
|
|
27,800
|
|
|
|
Neuffen, Germany
|
|
Manufacturing and offices
|
|
24,700
|
|
|
|
Nogales, Mexico
|
|
Manufacturing and offices
|
|
181,300
|
|
|
|
Bern, Switzerland
|
|
Manufacturing and offices
|
|
1,100
|
|
(4
|
)
|
December 31
|
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
Badger Meter, Inc.
|
Return %
|
|
64.04%
|
16.66%
|
10.49%
|
—%
|
27.71%
|
|
Cumulative $
|
$100.00
|
$164.04
|
$191.38
|
$211.46
|
$211.53
|
$270.15
|
Russell 2000 Index
|
Return %
|
|
16.35%
|
38.82%
|
4.89%
|
(4.41)%
|
21.31%
|
|
Cumulative $
|
$100.00
|
$116.35
|
$161.52
|
$169.42
|
$161.95
|
$196.45
|
Peer Group
|
Return %
|
|
29.11%
|
40.14%
|
0.51%
|
(9.99)%
|
37.54%
|
|
Cumulative $
|
$100.00
|
$129.11
|
$180.94
|
$181.88
|
$163.71
|
$225.16
|
|
Years ended December 31,
|
|
||||||||
(In thousands except per share data)
|
2016
|
2015
|
2014
|
2013
|
2012
|
2011
|
2010
|
2009
|
2008
|
2007
|
Operating results
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
$393,761
|
377,698
|
364,768
|
334,122
|
319,660
|
262,915
|
276,634
|
250,337
|
279,552
|
234,816
|
Research and development
|
$10,597
|
10,645
|
9,496
|
10,504
|
9,567
|
8,086
|
7,164
|
6,910
|
7,136
|
5,714
|
Earnings from continuing operations before income taxes
|
$49,844
|
41,152
|
44,912
|
38,009
|
43,471
|
27,349
|
44,438
|
42,333
|
39,555
|
29,325
|
Earnings from continuing operations
|
$32,295
|
25,938
|
29,678
|
24,617
|
28,032
|
19,161
|
28,662
|
26,780
|
25,084
|
18,386
|
Earnings (loss) from discontinued
operations (1)
|
$ n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
7,390
|
n/a
|
(1,929)
|
Net earnings
|
$32,295
|
25,938
|
29,678
|
24,617
|
28,032
|
19,161
|
28,662
|
34,170
|
25,084
|
16,457
|
Earnings from continuing operations to sales
|
8.2%
|
6.9%
|
8.1%
|
7.4%
|
8.8%
|
7.3%
|
10.4%
|
10.7%
|
9.0%
|
7.8%
|
Per Common share (2)
|
|
|
|
|
|
|
|
|
|
|
Basic earnings from continuing operations
|
$1.12
|
0.90
|
1.04
|
0.86
|
0.98
|
0.64
|
0.96
|
0.91
|
0.86
|
0.65
|
Basic earnings (loss) from discontinued operations
|
$ n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
0.25
|
n/a
|
(0.07)
|
Total basic earnings
|
$1.12
|
0.90
|
1.04
|
0.86
|
0.98
|
0.64
|
0.96
|
1.16
|
0.86
|
0.58
|
Diluted earnings from continuing operations
|
$1.11
|
0.90
|
1.03
|
0.85
|
0.98
|
0.64
|
0.96
|
0.90
|
0.85
|
0.63
|
Diluted earnings (loss) from discontinued operations
|
$ n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
0.25
|
n/a
|
(0.07)
|
Total diluted earnings
|
$1.11
|
0.90
|
1.03
|
0.85
|
0.98
|
0.64
|
0.96
|
1.14
|
0.85
|
0.57
|
Cash dividends declared: Common Stock
|
$0.43
|
0.39
|
0.37
|
0.35
|
0.33
|
0.30
|
0.26
|
0.23
|
0.20
|
0.17
|
Price range - high
|
$39.36
|
32.94
|
30.46
|
28.18
|
24.30
|
22.74
|
22.75
|
22.45
|
31.37
|
23.22
|
Price range - low
|
$26.40
|
25.82
|
23.24
|
20.94
|
14.65
|
13.43
|
16.29
|
11.25
|
8.79
|
11.50
|
Closing price
|
$36.95
|
29.30
|
29.68
|
27.25
|
23.71
|
14.72
|
22.11
|
19.91
|
14.51
|
22.48
|
Book value *
|
$8.80
|
8.00
|
7.41
|
6.82
|
5.98
|
5.93
|
5.60
|
4.82
|
3.75
|
3.17
|
Shares outstanding at year-end (2)
|
|
|
|
|
|
|
|
|
|
|
Common Stock
|
29,119
|
29,050
|
28,922
|
28,824
|
28,628
|
30,246
|
30,096
|
29,946
|
29,616
|
29,038
|
Financial position
|
|
|
|
|
|
|
|
|
|
|
Working capital *
|
$75,174
|
44,784
|
34,030
|
29,122
|
27,294
|
78,782
|
64,658
|
60,419
|
35,740
|
38,725
|
Current ratio *
|
2.0 to 1
|
1.4 to 1
|
1.3 to 1
|
1.3 to 1
|
1.3 to 1
|
4.5 to 1
|
3.0 to 1
|
3.3 to 1
|
1.7 to 1
|
1.9 to 1
|
Net cash provided by operations
|
$56,185
|
35,831
|
35,735
|
34,818
|
34,802
|
31,317
|
18,396
|
36,588
|
26,143
|
27,934
|
Capital expenditures
|
$10,596
|
19,766
|
12,332
|
14,311
|
8,202
|
5,336
|
9,238
|
7,750
|
13,237
|
15,971
|
Total assets
|
$349,699
|
355,480
|
341,158
|
316,058
|
290,453
|
218,910
|
215,864
|
191,016
|
195,358
|
150,301
|
Short-term and current portion of long-term debt
|
$37,950
|
71,360
|
75,927
|
70,045
|
66,730
|
1,790
|
12,878
|
8,003
|
19,670
|
13,582
|
Long-term debt
|
$ n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
5,504
|
3,129
|
Shareholders' equity (3)
|
$256,209
|
232,275
|
214,331
|
196,563
|
171,247
|
179,281
|
168,383
|
144,461
|
111,023
|
91,969
|
Debt as a percent of total debt and equity *
|
12.9%
|
23.5%
|
26.2%
|
26.3%
|
28.0%
|
1.0%
|
7.1%
|
5.2%
|
18.5%
|
15.4%
|
Return on shareholders' equity *
|
12.6%
|
11.2%
|
13.8%
|
12.5%
|
16.4%
|
10.7%
|
17.0%
|
18.5%
|
22.6%
|
20.0%
|
Price/earnings ratio *
|
33.3
|
32.6
|
28.8
|
32.1
|
24.3
|
23.2
|
23.2
|
22.2
|
17.2
|
35.7
|
|
Payments due by period
|
||||||||||||||||||
|
Total
|
|
Less than
1 year
|
|
1-3 years
|
|
3-5 years
|
|
Beyond
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Short-term debt
|
$
|
37,950
|
|
|
$
|
37,950
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Operating leases
|
13,049
|
|
|
2,437
|
|
|
3,953
|
|
|
2,793
|
|
|
3,866
|
|
|||||
Total contractual obligations
|
$
|
50,999
|
|
|
$
|
40,387
|
|
|
$
|
3,953
|
|
|
$
|
2,793
|
|
|
$
|
3,866
|
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Assets
|
(Dollars in thousands)
|
||||||
Current assets:
|
|
|
|
||||
Cash
|
$
|
7,338
|
|
|
$
|
8,163
|
|
Receivables
|
59,818
|
|
|
56,643
|
|
||
Inventories:
|
|
|
|
||||
Finished goods
|
18,087
|
|
|
28,548
|
|
||
Work in process
|
17,157
|
|
|
13,184
|
|
||
Raw materials
|
42,457
|
|
|
36,864
|
|
||
Total inventories
|
77,701
|
|
|
78,596
|
|
||
Prepaid expenses and other current assets
|
6,155
|
|
|
5,926
|
|
||
Total current assets
|
151,012
|
|
|
149,328
|
|
||
Property, plant and equipment, at cost:
|
|
|
|
||||
Land and improvements
|
9,068
|
|
|
9,033
|
|
||
Buildings and improvements
|
65,230
|
|
|
59,839
|
|
||
Machinery and equipment
|
126,680
|
|
|
125,197
|
|
||
|
200,978
|
|
|
194,069
|
|
||
Less accumulated depreciation
|
(110,784
|
)
|
|
(103,149
|
)
|
||
Net property, plant and equipment
|
90,194
|
|
|
90,920
|
|
||
Intangible assets, at cost less accumulated amortization
|
51,872
|
|
|
57,348
|
|
||
Other assets
|
6,607
|
|
|
8,485
|
|
||
Deferred income taxes
|
700
|
|
|
1,421
|
|
||
Goodwill
|
49,314
|
|
|
47,978
|
|
||
Total assets
|
$
|
349,699
|
|
|
$
|
355,480
|
|
Liabilities and Shareholders’ Equity
|
|||||||
Current liabilities:
|
|
|
|
||||
Short-term debt
|
$
|
37,950
|
|
|
$
|
71,360
|
|
Payables
|
18,350
|
|
|
19,155
|
|
||
Accrued compensation and employee benefits
|
13,861
|
|
|
9,663
|
|
||
Warranty and after-sale costs
|
2,779
|
|
|
3,133
|
|
||
Income and other taxes
|
2,898
|
|
|
1,233
|
|
||
Total current liabilities
|
75,838
|
|
|
104,544
|
|
||
Other long-term liabilities
|
4,019
|
|
|
4,809
|
|
||
Deferred income taxes
|
1,901
|
|
|
774
|
|
||
Accrued non-pension postretirement benefits
|
5,753
|
|
|
5,709
|
|
||
Other accrued employee benefits
|
5,979
|
|
|
7,369
|
|
||
Commitments and contingencies (Note 6)
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
||||
Common Stock, $1 par; authorized 40,000,000 shares; issued 37,121,618 shares in 2016 and 41,102,538 shares in 2015
|
37,122
|
|
|
41,103
|
|
||
Capital in excess of par value
|
28,022
|
|
|
31,626
|
|
||
Reinvested earnings
|
223,876
|
|
|
204,044
|
|
||
Accumulated other comprehensive loss
|
(11,635
|
)
|
|
(12,780
|
)
|
||
Less: Employee benefit stock
|
(614
|
)
|
|
(768
|
)
|
||
Treasury stock, at cost; 8,003,086 shares in 2016 and 12,052,894 shares in 2015
|
(20,562
|
)
|
|
(30,950
|
)
|
||
Total shareholders’ equity
|
256,209
|
|
|
232,275
|
|
||
Total liabilities and shareholders’ equity
|
$
|
349,699
|
|
|
$
|
355,480
|
|
|
Years ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
|
(In thousands except per share amounts)
|
||||||||||
Net sales
|
$
|
393,761
|
|
|
$
|
377,698
|
|
|
$
|
364,768
|
|
Cost of sales
|
243,185
|
|
|
241,922
|
|
|
233,626
|
|
|||
Gross margin
|
150,576
|
|
|
135,776
|
|
|
131,142
|
|
|||
Selling, engineering and administration
|
99,811
|
|
|
93,407
|
|
|
85,095
|
|
|||
Operating earnings
|
50,765
|
|
|
42,369
|
|
|
46,047
|
|
|||
Interest expense, net
|
921
|
|
|
1,217
|
|
|
1,135
|
|
|||
Earnings before income taxes
|
49,844
|
|
|
41,152
|
|
|
44,912
|
|
|||
Provision for income taxes
|
17,549
|
|
|
15,214
|
|
|
15,234
|
|
|||
Net earnings
|
$
|
32,295
|
|
|
$
|
25,938
|
|
|
$
|
29,678
|
|
|
|
|
|
|
|
||||||
Earnings per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
1.12
|
|
|
$
|
0.90
|
|
|
$
|
1.04
|
|
|
|
|
|
|
|
||||||
Diluted
|
$
|
1.11
|
|
|
$
|
0.90
|
|
|
$
|
1.03
|
|
|
|
|
|
|
|
||||||
Shares used in computation of earnings per share:
|
|
|
|
|
|
||||||
Basic
|
28,887
|
|
|
28,759
|
|
|
28,613
|
|
|||
Impact of dilutive securities
|
163
|
|
|
135
|
|
|
144
|
|
|||
Diluted
|
29,050
|
|
|
28,894
|
|
|
28,757
|
|
|
Years ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
|
(Dollars in thousands)
|
||||||||||
Net earnings
|
$
|
32,295
|
|
|
$
|
25,938
|
|
|
$
|
29,678
|
|
Other comprehensive income :
|
|
|
|
|
|
||||||
Foreign currency translation adjustment
|
(328
|
)
|
|
(847
|
)
|
|
(1,721
|
)
|
|||
Pension and postretirement benefits, net of tax
|
1,473
|
|
|
(77
|
)
|
|
(2,611
|
)
|
|||
Comprehensive income
|
$
|
33,440
|
|
|
$
|
25,014
|
|
|
$
|
25,346
|
|
|
Years ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
|
(Dollars in thousands)
|
||||||||||
Operating activities:
|
|
|
|
|
|
||||||
Net earnings
|
$
|
32,295
|
|
|
$
|
25,938
|
|
|
$
|
29,678
|
|
Adjustments to reconcile net earnings to net cash provided by operations:
|
|
|
|
|
|
||||||
Depreciation
|
10,715
|
|
|
9,993
|
|
|
8,891
|
|
|||
Amortization
|
11,727
|
|
|
10,606
|
|
|
6,773
|
|
|||
Deferred income taxes
|
710
|
|
|
(3,023
|
)
|
|
(1,334
|
)
|
|||
Contributions to pension plan
|
(1,000
|
)
|
|
—
|
|
|
—
|
|
|||
Noncurrent employee benefits
|
660
|
|
|
1,261
|
|
|
4,417
|
|
|||
Stock-based compensation expense
|
1,537
|
|
|
1,541
|
|
|
1,449
|
|
|||
Changes in:
|
|
|
|
|
|
||||||
Receivables
|
(3,561
|
)
|
|
(5,511
|
)
|
|
(997
|
)
|
|||
Inventories
|
955
|
|
|
(7,116
|
)
|
|
(6,943
|
)
|
|||
Prepaid expenses and other current assets
|
(961
|
)
|
|
(1,632
|
)
|
|
(2,060
|
)
|
|||
Liabilities other than debt
|
3,108
|
|
|
3,774
|
|
|
(4,139
|
)
|
|||
Total adjustments
|
23,890
|
|
|
9,893
|
|
|
6,057
|
|
|||
Net cash provided by operations
|
56,185
|
|
|
35,831
|
|
|
35,735
|
|
|||
Investing activities:
|
|
|
|
|
|
||||||
Property, plant and equipment additions
|
(10,596
|
)
|
|
(19,766
|
)
|
|
(12,332
|
)
|
|||
Acquisitions, net of cash acquired
|
(1,800
|
)
|
|
(1,907
|
)
|
|
(20,829
|
)
|
|||
Net cash used for investing activities
|
(12,396
|
)
|
|
(21,673
|
)
|
|
(33,161
|
)
|
|||
Financing activities:
|
|
|
|
|
|
||||||
Net (decrease) increase in short-term debt
|
(33,096
|
)
|
|
(3,960
|
)
|
|
6,653
|
|
|||
Dividends paid
|
(12,461
|
)
|
|
(11,261
|
)
|
|
(10,633
|
)
|
|||
Proceeds from exercise of stock options
|
568
|
|
|
1,641
|
|
|
730
|
|
|||
Tax benefit on stock options
|
—
|
|
|
141
|
|
|
38
|
|
|||
Issuance of treasury stock
|
518
|
|
|
470
|
|
|
469
|
|
|||
Net cash used for financing activities
|
(44,471
|
)
|
|
(12,969
|
)
|
|
(2,743
|
)
|
|||
Effect of foreign exchange rates on cash
|
(143
|
)
|
|
318
|
|
|
(438
|
)
|
|||
(Decrease) Increase in cash
|
(825
|
)
|
|
1,507
|
|
|
(607
|
)
|
|||
Cash — beginning of year
|
8,163
|
|
|
6,656
|
|
|
7,263
|
|
|||
Cash — end of year
|
$
|
7,338
|
|
|
$
|
8,163
|
|
|
$
|
6,656
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
||||||
Cash paid during the year for:
|
|
|
|
|
|
||||||
Income taxes
|
$
|
19,723
|
|
|
$
|
18,167
|
|
|
$
|
17,218
|
|
Interest
|
$
|
952
|
|
|
$
|
1,246
|
|
|
$
|
1,144
|
|
Non cash transaction:
|
|
|
|
|
|
||||||
Settlement of National Meter and Automation, Inc. payables prior to the acquisition
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,623
|
|
Settlement of United Utilities, Inc. payables prior to the acquisition
|
$
|
—
|
|
|
$
|
2,866
|
|
|
$
|
—
|
|
|
Years ended December 31,
|
||||||||||||||||||||||||||
|
Common
Stock at $1
par value*
|
|
Capital in
excess of
par value
|
|
Reinvested
earnings
|
|
Accumulated
other
comprehensive
income
(loss)
|
|
Employee
benefit
stock
|
|
Treasury
stock
|
|
Total
|
||||||||||||||
|
(In thousands except per share amounts)
|
||||||||||||||||||||||||||
Balance, December 31, 2013
|
$
|
41,008
|
|
|
$
|
25,123
|
|
|
$
|
170,318
|
|
|
$
|
(7,524
|
)
|
|
$
|
(1,075
|
)
|
|
$
|
(31,287
|
)
|
|
$
|
196,563
|
|
Net earnings
|
—
|
|
|
—
|
|
|
29,678
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
29,678
|
|
|||||||
Pension and postretirement benefits (net of $(1,381) tax effect)
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,611
|
)
|
|
—
|
|
|
—
|
|
|
(2,611
|
)
|
|||||||
Foreign currency translation
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,721
|
)
|
|
—
|
|
|
—
|
|
|
(1,721
|
)
|
|||||||
Cash dividends of $0.37 per share
|
—
|
|
|
—
|
|
|
(10,631
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,631
|
)
|
|||||||
Stock options exercised
|
38
|
|
|
692
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
730
|
|
|||||||
Tax benefit on stock options and dividends
|
—
|
|
|
38
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38
|
|
|||||||
ESSOP transactions
|
—
|
|
|
214
|
|
|
—
|
|
|
—
|
|
|
153
|
|
|
—
|
|
|
367
|
|
|||||||
Stock-based compensation
|
—
|
|
|
1,449
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,449
|
|
|||||||
Issuance of treasury stock (60 shares)
|
—
|
|
|
314
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
155
|
|
|
469
|
|
|||||||
Balance, December 31, 2014
|
41,046
|
|
|
27,830
|
|
|
189,365
|
|
|
(11,856
|
)
|
|
(922
|
)
|
|
(31,132
|
)
|
|
214,331
|
|
|||||||
Net earnings
|
—
|
|
|
—
|
|
|
25,938
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25,938
|
|
|||||||
Pension and postretirement benefits (net of $(122) tax effect)
|
—
|
|
|
—
|
|
|
—
|
|
|
(77
|
)
|
|
—
|
|
|
—
|
|
|
(77
|
)
|
|||||||
Foreign currency translation
|
—
|
|
|
—
|
|
|
—
|
|
|
(847
|
)
|
|
—
|
|
|
—
|
|
|
(847
|
)
|
|||||||
Cash dividends of $0.39 per share
|
—
|
|
|
—
|
|
|
(11,259
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,259
|
)
|
|||||||
Stock options exercised
|
57
|
|
|
1,517
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67
|
|
|
1,641
|
|
|||||||
Tax benefit on stock options and dividends
|
—
|
|
|
141
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
141
|
|
|||||||
ESSOP transactions
|
—
|
|
|
242
|
|
|
—
|
|
|
—
|
|
|
154
|
|
|
—
|
|
|
396
|
|
|||||||
Stock-based compensation
|
—
|
|
|
1,541
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,541
|
|
|||||||
Issuance of treasury stock (70 shares)
|
—
|
|
|
355
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
115
|
|
|
470
|
|
|||||||
Balance, December 31, 2015
|
41,103
|
|
|
31,626
|
|
|
204,044
|
|
|
(12,780
|
)
|
|
(768
|
)
|
|
(30,950
|
)
|
|
232,275
|
|
|||||||
Net earnings
|
—
|
|
|
—
|
|
|
32,295
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32,295
|
|
|||||||
Pension and postretirement benefits (net of $1,019 tax effect)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,473
|
|
|
—
|
|
|
—
|
|
|
1,473
|
|
|||||||
Foreign currency translation
|
—
|
|
|
—
|
|
|
—
|
|
|
(328
|
)
|
|
—
|
|
|
—
|
|
|
(328
|
)
|
|||||||
Cash dividends of $0.43 per share
|
—
|
|
|
—
|
|
|
(12,463
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,463
|
)
|
|||||||
Stock options exercised
|
19
|
|
|
528
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|
569
|
|
|||||||
Tax deficiency on stock options and dividends
|
—
|
|
|
(110
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(110
|
)
|
|||||||
ESSOP transactions
|
—
|
|
|
289
|
|
|
—
|
|
|
—
|
|
|
154
|
|
|
—
|
|
|
443
|
|
|||||||
Stock-based compensation
|
—
|
|
|
1,537
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,537
|
|
|||||||
Retirement of treasury stock
|
(4,000
|
)
|
|
(6,260
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,260
|
|
|
—
|
|
|||||||
Issuance of treasury stock (41 shares)
|
—
|
|
|
412
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
106
|
|
|
518
|
|
|||||||
Balance, December 31, 2016
|
$
|
37,122
|
|
|
$
|
28,022
|
|
|
$
|
223,876
|
|
|
$
|
(11,635
|
)
|
|
$
|
(614
|
)
|
|
$
|
(20,562
|
)
|
|
$
|
256,209
|
|
*
|
Each common share of stock equals
$1
par value; therefore, the number of common shares is the same as the dollar value.
|
|
Balance at
beginning
of year
|
|
Provision
and reserve
adjustments
|
|
Write-offs
less
recoveries
|
|
Balance
at end
of year
|
||||||||
|
(In thousands)
|
||||||||||||||
2016
|
$
|
477
|
|
|
$
|
2
|
|
|
$
|
(54
|
)
|
|
$
|
425
|
|
2015
|
$
|
811
|
|
|
$
|
(152
|
)
|
|
$
|
(182
|
)
|
|
$
|
477
|
|
2014
|
$
|
531
|
|
|
$
|
305
|
|
|
$
|
(25
|
)
|
|
$
|
811
|
|
|
Balance at
beginning
of year
|
|
Net additions
charged to
earnings
|
|
Disposals
|
|
Balance
at end
of year
|
||||||||
|
(In thousands)
|
||||||||||||||
2016
|
$
|
3,836
|
|
|
$
|
1,017
|
|
|
$
|
(1,214
|
)
|
|
$
|
3,639
|
|
2015
|
$
|
3,314
|
|
|
$
|
2,530
|
|
|
$
|
(2,008
|
)
|
|
$
|
3,836
|
|
2014
|
$
|
4,236
|
|
|
$
|
974
|
|
|
$
|
(1,896
|
)
|
|
$
|
3,314
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||
|
Gross carrying
amount
|
|
Accumulated
amortization
|
|
Gross carrying
amount
|
|
Accumulated
amortization
|
||||||||
|
(In thousands)
|
||||||||||||||
Technologies
|
$
|
47,657
|
|
|
$
|
18,970
|
|
|
$
|
47,157
|
|
|
$
|
16,104
|
|
Non-compete agreements
|
2,112
|
|
|
1,670
|
|
|
2,062
|
|
|
1,455
|
|
||||
Licenses
|
650
|
|
|
458
|
|
|
650
|
|
|
441
|
|
||||
Customer lists
|
4,923
|
|
|
1,698
|
|
|
4,923
|
|
|
1,327
|
|
||||
Customer relationships
|
20,790
|
|
|
7,416
|
|
|
20,690
|
|
|
5,494
|
|
||||
Trade names
|
9,475
|
|
|
3,523
|
|
|
9,475
|
|
|
2,788
|
|
||||
Total intangibles
|
$
|
85,607
|
|
|
$
|
33,735
|
|
|
$
|
84,957
|
|
|
$
|
27,609
|
|
|
Balance at
beginning
of year
|
|
Net additions
charged to
earnings
|
|
Adjustments to pre-existing warranties
|
|
Costs
incurred
|
|
Balance
at end
of year
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
2016
|
$
|
3,133
|
|
|
$
|
3,559
|
|
|
$
|
(554
|
)
|
|
$
|
(3,359
|
)
|
|
$
|
2,779
|
|
2015
|
$
|
1,739
|
|
|
$
|
1,559
|
|
|
$
|
1,278
|
|
|
$
|
(1,443
|
)
|
|
$
|
3,133
|
|
2014
|
$
|
882
|
|
|
$
|
2,255
|
|
|
$
|
257
|
|
|
$
|
(1,655
|
)
|
|
$
|
1,739
|
|
|
Pension and postretirement benefits
|
|
Foreign currency
|
|
Total
|
||||||
|
|
|
(In thousands)
|
|
|
||||||
Balance at beginning of period
|
$
|
(11,968
|
)
|
|
$
|
(812
|
)
|
|
$
|
(12,780
|
)
|
Other comprehensive income before reclassifications
|
—
|
|
|
(328
|
)
|
|
(328
|
)
|
|||
Amounts reclassified from accumulated other comprehensive loss, net of tax of $(1.0) million
|
1,473
|
|
|
—
|
|
|
1,473
|
|
|||
Net current period other comprehensive loss (income), net
|
1,473
|
|
|
(328
|
)
|
|
1,145
|
|
|||
Accumulated other comprehensive loss
|
$
|
(10,495
|
)
|
|
$
|
(1,140
|
)
|
|
$
|
(11,635
|
)
|
|
Amount reclassified from accumulated other comprehensive loss
|
||
|
(In thousands)
|
||
Amortization of employee benefit plan items:
|
|
||
Prior service cost (1)
|
$
|
(25
|
)
|
Settlement expense (1)
|
1,510
|
|
|
Actuarial loss (1)
|
1,007
|
|
|
Total before tax
|
2,492
|
|
|
Income tax benefit
|
(1,019
|
)
|
|
Amount reclassified out of accumulated other comprehensive loss
|
$
|
1,473
|
|
(1)
|
These accumulated other comprehensive loss components are included in the computation of benefit plan costs in Note 7 “Employee Benefit Plans.”
|
|
Pension and postretirement benefits
|
|
Foreign currency
|
|
Total
|
||||||
|
(In thousands)
|
||||||||||
Balance at beginning of period
|
$
|
(11,891
|
)
|
|
$
|
35
|
|
|
$
|
(11,856
|
)
|
Other comprehensive income before reclassifications
|
(1,317
|
)
|
|
(847
|
)
|
|
(2,164
|
)
|
|||
Amounts reclassified from accumulated other comprehensive loss, net of tax of $(0.7) million
|
1,240
|
|
|
—
|
|
|
1,240
|
|
|||
Net current period other comprehensive income, net
|
(77
|
)
|
|
(847
|
)
|
|
(924
|
)
|
|||
Accumulated other comprehensive loss
|
$
|
(11,968
|
)
|
|
$
|
(812
|
)
|
|
$
|
(12,780
|
)
|
|
Amount reclassified from accumulated other comprehensive loss
|
||
|
(In thousands)
|
||
Amortization of employee benefit plan items:
|
|
||
Prior service cost (1)
|
$
|
53
|
|
Settlement expense (1)
|
762
|
|
|
Actuarial loss (1)
|
1,153
|
|
|
Total before tax
|
1,968
|
|
|
Income tax benefit
|
(728
|
)
|
|
Amount reclassified out of accumulated other comprehensive loss
|
$
|
1,240
|
|
(1)
|
These accumulated other comprehensive loss components are included in the computation of benefit plan costs in Note 7 “Employee Benefit Plans.”
|
|
2016
|
|
2015
|
||||
|
(In thousands)
|
||||||
Notes payable to banks
|
$
|
8,200
|
|
|
$
|
5,860
|
|
Commercial paper
|
29,750
|
|
|
65,500
|
|
||
Total short-term debt
|
$
|
37,950
|
|
|
$
|
71,360
|
|
|
Number of shares
|
|
Weighted-average
exercise price
|
|||
Options outstanding - December 31, 2013
|
404,756
|
|
|
$
|
19.64
|
|
Options granted
|
47,916
|
|
|
$
|
27.18
|
|
Options exercised
|
(46,032
|
)
|
|
$
|
16.29
|
|
Options forfeited
|
—
|
|
|
n/a
|
|
|
Options outstanding - December 31, 2014
|
406,640
|
|
|
$
|
20.90
|
|
Options granted
|
49,510
|
|
|
$
|
28.33
|
|
Options exercised
|
(86,538
|
)
|
|
$
|
18.98
|
|
Options forfeited
|
—
|
|
|
n/a
|
|
|
Options outstanding - December 31, 2015
|
369,612
|
|
|
$
|
22.35
|
|
Options granted
|
42,302
|
|
|
$
|
33.98
|
|
Options exercised
|
(27,656
|
)
|
|
$
|
20.59
|
|
Options forfeited
|
—
|
|
|
n/a
|
|
|
Options outstanding - December 31, 2016
|
384,258
|
|
|
$
|
23.75
|
|
Price range $18.08 — $18.30
|
|
|
|
|||
(weighted-average contractual life of 5.0 years)
|
106,660
|
|
|
$
|
18.15
|
|
Price range $18.30 — $19.35
|
|
|
|
|||
(weighted-average contractual life of 4.1 years)
|
119,516
|
|
|
$
|
21.48
|
|
Price range $19.35 — $33.75
|
|
|
|
|||
(weighted-average contractual life of 7.2 years)
|
158,082
|
|
|
$
|
29.25
|
|
Options outstanding - December 31, 2016
|
384,258
|
|
|
|
||
Exercisable options —
|
|
|
|
|||
December 31, 2014
|
222,032
|
|
|
$
|
19.84
|
|
December 31, 2015
|
210,940
|
|
|
$
|
20.48
|
|
December 31, 2016
|
242,522
|
|
|
$
|
21.01
|
|
|
2016
|
|
2015
|
||
Per share fair value of options granted during the period
|
$13.58
|
|
$11.54
|
||
Risk-free interest rate
|
1.42
|
%
|
|
1.74
|
%
|
Dividend yield
|
1.16
|
%
|
|
1.32
|
%
|
Volatility factor
|
48.3
|
%
|
|
49.5
|
%
|
Weighted-average expected life in years
|
5.3
|
|
|
5.3
|
|
|
2016
|
|
2015
|
||||
|
(In thousands)
|
||||||
Exercised
|
$
|
379
|
|
|
$
|
1,058
|
|
Outstanding
|
$
|
4,288
|
|
|
$
|
2,569
|
|
Exercisable
|
$
|
3,370
|
|
|
$
|
1,859
|
|
|
Total leases
|
||
|
(In thousands)
|
||
2017
|
$
|
2,437
|
|
2018
|
2,245
|
|
|
2019
|
1,708
|
|
|
2020
|
1,434
|
|
|
2021
|
1,359
|
|
|
Thereafter
|
3,866
|
|
|
Total lease obligations
|
$
|
13,049
|
|
|
Pension
plans
|
|
Other
postretirement
benefits
|
||||
|
(In thousands)
|
||||||
Prior service cost
|
$
|
—
|
|
|
$
|
(23
|
)
|
Net actuarial loss
|
$
|
10,398
|
|
|
$
|
(339
|
)
|
|
Pension
plans
|
|
Other
postretirement
benefits
|
||||
|
(In thousands)
|
||||||
Prior service credit
|
$
|
—
|
|
|
$
|
(16
|
)
|
Net actuarial loss
|
$
|
350
|
|
|
$
|
—
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(In thousands)
|
||||||||||
Service cost — benefits earned during the year
|
$
|
3
|
|
|
$
|
4
|
|
|
$
|
4
|
|
Interest cost on projected benefit obligations
|
1,711
|
|
|
1,769
|
|
|
1,888
|
|
|||
Expected return on plan assets
|
(2,199
|
)
|
|
(2,151
|
)
|
|
(2,806
|
)
|
|||
Amortization of net loss
|
575
|
|
|
656
|
|
|
606
|
|
|||
Settlement expense
|
1,510
|
|
|
762
|
|
|
858
|
|
|||
Net periodic pension cost
|
$
|
1,600
|
|
|
$
|
1,040
|
|
|
$
|
550
|
|
|
2016
|
|
2015
|
|
2014
|
|||
Discount rate
|
4.14
|
%
|
|
3.81
|
%
|
|
4.47
|
%
|
Expected long-term return on plan assets
|
5.25
|
%
|
|
5.00
|
%
|
|
6.50
|
%
|
Rate of compensation increase
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
2016
|
|
2015
|
||||
|
(In thousands)
|
||||||
Change in benefit obligation:
|
|
|
|
||||
Benefit obligation at beginning of plan year
|
$
|
45,471
|
|
|
$
|
48,200
|
|
Service cost
|
3
|
|
|
4
|
|
||
Interest cost
|
1,711
|
|
|
1,769
|
|
||
Actuarial loss/(gain)
|
537
|
|
|
(906
|
)
|
||
Benefits paid
|
(5,692
|
)
|
|
(3,596
|
)
|
||
Projected benefit obligation at measurement date
|
$
|
42,030
|
|
|
$
|
45,471
|
|
|
|
|
|
||||
Change in plan assets:
|
|
|
|
||||
Fair value of plan assets at beginning of plan year
|
$
|
43,603
|
|
|
$
|
48,656
|
|
Actual return on plan assets
|
3,150
|
|
|
(1,457
|
)
|
||
Company contribution
|
1,000
|
|
|
—
|
|
||
Benefits paid
|
(5,692
|
)
|
|
(3,596
|
)
|
||
Fair value of plan assets at measurement date
|
$
|
42,061
|
|
|
$
|
43,603
|
|
|
|
|
|
||||
Funded status of the plan:
|
|
|
|
||||
Benefit plan assets in excess of benefit obligation
|
31
|
|
|
—
|
|
||
Benefit obligation in excess of plan assets
|
—
|
|
|
(1,868
|
)
|
||
Prepaid pension asset (accrued pension liability)
|
$
|
31
|
|
|
$
|
(1,868
|
)
|
|
2016
|
|
2015
|
||
Discount rate
|
3.94
|
%
|
|
4.14
|
%
|
|
2016
|
||||||||||||||
|
Market
value
|
|
Quoted
prices in active
markets for
identical assets
(Level 1)
|
|
Significant
observable
inputs
(Level 2)
|
|
Significant
unobservable
inputs
(Level 3)
|
||||||||
|
(In thousands)
|
||||||||||||||
Equity securities (a)
|
$
|
4,045
|
|
|
$
|
—
|
|
|
$
|
4,045
|
|
|
$
|
—
|
|
Fixed income funds (b)
|
37,527
|
|
|
—
|
|
|
37,527
|
|
|
—
|
|
||||
Cash/cash equivalents (c)
|
489
|
|
|
489
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
42,061
|
|
|
$
|
489
|
|
|
$
|
41,572
|
|
|
$
|
—
|
|
|
2015
|
||||||||||||||
|
Market
value
|
|
Quoted
prices in active
markets for
identical assets
(Level 1)
|
|
Significant
observable
inputs
(Level 2)
|
|
Significant
unobservable
inputs
(Level 3)
|
||||||||
|
(In thousands)
|
||||||||||||||
Equity securities (a)
|
$
|
5,614
|
|
|
$
|
—
|
|
|
$
|
5,614
|
|
|
$
|
—
|
|
Fixed income funds (b)
|
36,954
|
|
|
—
|
|
|
36,954
|
|
|
—
|
|
||||
Cash/cash equivalents (c)
|
1,035
|
|
|
1,035
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
43,603
|
|
|
$
|
1,035
|
|
|
$
|
42,568
|
|
|
$
|
—
|
|
(a)
|
The Equity funds in aggregate are well diversified by market capitalization, investment style and geography. The funds seek to provide investment results approximating the aggregate price and dividend performance of securities included in the S&P 500 Index, Russell 2000 Index and MSCI All Country World ex-US Index.
|
(b)
|
The Fixed Income funds consist of bonds. In aggregate, the funds seek to provide investment results approximating the return of the Plan’s obligations. The funds consist of long credit bonds, intermediate credit bonds, short duration government credit bonds and bank loans.
|
(c)
|
This category comprises the cash held to pay beneficiaries. The fair value of cash equals its book value.
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(In thousands)
|
||||||||||
Service cost, benefits attributed for service of active employees for the period
|
$
|
137
|
|
|
$
|
147
|
|
|
$
|
130
|
|
Interest cost on the accumulated postretirement benefit obligation
|
257
|
|
|
251
|
|
|
269
|
|
|||
Amortization of prior service (credit) cost
|
(25
|
)
|
|
53
|
|
|
161
|
|
|||
Net periodic postretirement benefit cost
|
$
|
369
|
|
|
$
|
451
|
|
|
$
|
560
|
|
|
2016
|
|
2015
|
||||
|
(In thousands)
|
||||||
Benefit obligation at beginning of year
|
$
|
6,100
|
|
|
$
|
6,767
|
|
Service cost
|
137
|
|
|
147
|
|
||
Interest cost
|
257
|
|
|
251
|
|
||
Actuarial gain
|
(249
|
)
|
|
(812
|
)
|
||
Plan participants' contributions
|
604
|
|
|
628
|
|
||
Benefits paid
|
(718
|
)
|
|
(881
|
)
|
||
Benefit obligation and funded status at end of year
|
$
|
6,131
|
|
|
$
|
6,100
|
|
|
2016
|
|
2015
|
||||
|
(In thousands)
|
||||||
Accrued compensation and employee benefits
|
$
|
378
|
|
|
$
|
391
|
|
Accrued non-pension postretirement benefits
|
5,753
|
|
|
5,709
|
|
||
Amounts recognized at December 31
|
$
|
6,131
|
|
|
$
|
6,100
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(In thousands)
|
||||||||||
Domestic
|
$
|
47,407
|
|
|
$
|
39,447
|
|
|
$
|
41,022
|
|
Foreign
|
2,437
|
|
|
1,705
|
|
|
3,890
|
|
|||
Total
|
$
|
49,844
|
|
|
$
|
41,152
|
|
|
$
|
44,912
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(In thousands)
|
||||||||||
Current:
|
|
||||||||||
Federal
|
$
|
14,435
|
|
|
$
|
15,324
|
|
|
$
|
14,362
|
|
State
|
1,275
|
|
|
2,227
|
|
|
1,086
|
|
|||
Foreign
|
1,129
|
|
|
686
|
|
|
1,120
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
922
|
|
|
(2,568
|
)
|
|
(1,323
|
)
|
|||
State
|
151
|
|
|
(353
|
)
|
|
208
|
|
|||
Foreign
|
(363
|
)
|
|
(102
|
)
|
|
(219
|
)
|
|||
Total
|
$
|
17,549
|
|
|
$
|
15,214
|
|
|
$
|
15,234
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(In thousands)
|
||||||||||
Provision at statutory rate
|
$
|
17,445
|
|
|
$
|
14,403
|
|
|
$
|
15,720
|
|
State income taxes, net of federal tax benefit
|
923
|
|
|
1,242
|
|
|
841
|
|
|||
Foreign - tax rate differential and other
|
(87
|
)
|
|
(13
|
)
|
|
(454
|
)
|
|||
Domestic production activities deduction
|
(560
|
)
|
|
(521
|
)
|
|
(675
|
)
|
|||
Other
|
(172
|
)
|
|
103
|
|
|
(198
|
)
|
|||
Actual provision
|
$
|
17,549
|
|
|
$
|
15,214
|
|
|
$
|
15,234
|
|
|
2016
|
|
2015
|
||||
|
(In thousands)
|
||||||
Deferred tax assets:
|
|
|
|
||||
Reserve for receivables and inventories
|
$
|
2,931
|
|
|
$
|
2,979
|
|
Accrued compensation
|
1,131
|
|
|
1,180
|
|
||
Payables
|
1,107
|
|
|
1,237
|
|
||
Non-pension postretirement benefits
|
2,344
|
|
|
2,337
|
|
||
Net operating loss and credit carryforwards
|
968
|
|
|
1,193
|
|
||
Accrued pension benefits
|
413
|
|
|
1,398
|
|
||
Accrued employee benefits
|
4,103
|
|
|
3,969
|
|
||
Other
|
487
|
|
|
856
|
|
||
Total deferred tax assets
|
13,484
|
|
|
15,149
|
|
||
|
|
|
|
||||
Deferred tax liabilities:
|
|
|
|
||||
Depreciation
|
5,126
|
|
|
4,652
|
|
||
Amortization
|
8,992
|
|
|
9,850
|
|
||
Prepaids
|
567
|
|
|
—
|
|
||
Total deferred tax liabilities
|
14,685
|
|
|
14,502
|
|
||
Net deferred tax (liabilities) assets
|
$
|
(1,201
|
)
|
|
$
|
647
|
|
|
2016
|
|
2015
|
||||
|
(In thousands)
|
||||||
Balance at beginning of year
|
$
|
533
|
|
|
$
|
846
|
|
Increases in unrecognized tax benefits as a result of positions taken during the prior period
|
88
|
|
|
22
|
|
||
Increases in unrecognized tax benefits as a result of positions taken during the current period
|
247
|
|
|
166
|
|
||
Decreases in unrecognized tax benefits relating to settlements with taxing authorities
|
—
|
|
|
(347
|
)
|
||
Reductions to unrecognized tax benefits as a result of a lapse of the applicable statute of limitations
|
(54
|
)
|
|
(154
|
)
|
||
Balance at end of year
|
$
|
814
|
|
|
$
|
533
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(In thousands)
|
||||||||||
Revenues:
|
|
|
|
|
|
||||||
United States
|
$
|
347,853
|
|
|
$
|
322,535
|
|
|
$
|
309,651
|
|
Foreign:
|
|
|
|
|
|
||||||
Asia
|
6,539
|
|
|
8,299
|
|
|
10,647
|
|
|||
Canada
|
12,587
|
|
|
9,095
|
|
|
12,092
|
|
|||
Europe
|
15,299
|
|
|
17,036
|
|
|
19,448
|
|
|||
Mexico
|
3,460
|
|
|
8,889
|
|
|
3,941
|
|
|||
Middle East
|
5,520
|
|
|
9,672
|
|
|
6,221
|
|
|||
Other
|
2,503
|
|
|
2,172
|
|
|
2,768
|
|
|||
Total
|
$
|
393,761
|
|
|
$
|
377,698
|
|
|
$
|
364,768
|
|
|
Quarter ended
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
|
(In thousands except per share data)
|
||||||||||||||
2016
|
|
|
|
|
|
|
|
||||||||
Net sales
|
$
|
100,570
|
|
|
$
|
103,820
|
|
|
$
|
96,273
|
|
|
$
|
93,098
|
|
Gross margin
|
$
|
39,011
|
|
|
$
|
39,396
|
|
|
$
|
38,647
|
|
|
$
|
33,522
|
|
Net earnings
|
$
|
7,990
|
|
|
$
|
9,400
|
|
|
$
|
8,792
|
|
|
$
|
6,113
|
|
Earnings per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.28
|
|
|
$
|
0.33
|
|
|
$
|
0.30
|
|
|
$
|
0.21
|
|
Diluted
|
$
|
0.28
|
|
|
$
|
0.32
|
|
|
$
|
0.30
|
|
|
$
|
0.21
|
|
Dividends declared
|
$
|
0.10
|
|
|
$
|
0.10
|
|
|
$
|
0.115
|
|
|
$
|
0.115
|
|
Stock price:
|
|
|
|
|
|
|
|
||||||||
High
|
$
|
34.74
|
|
|
$
|
39.36
|
|
|
$
|
37.80
|
|
|
$
|
39.15
|
|
Low
|
$
|
26.40
|
|
|
$
|
31.72
|
|
|
$
|
31.90
|
|
|
$
|
29.30
|
|
Quarter-end close
|
$
|
33.26
|
|
|
$
|
36.52
|
|
|
$
|
33.51
|
|
|
$
|
36.95
|
|
|
|
|
|
|
|
|
|
||||||||
2015
|
|
|
|
|
|
|
|
||||||||
Net sales
|
$
|
83,644
|
|
|
$
|
98,896
|
|
|
$
|
99,388
|
|
|
$
|
95,770
|
|
Gross margin
|
$
|
30,075
|
|
|
$
|
35,143
|
|
|
$
|
36,101
|
|
|
$
|
34,457
|
|
Net earnings
|
$
|
4,227
|
|
|
$
|
7,901
|
|
|
$
|
8,327
|
|
|
$
|
5,483
|
|
Earnings per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.15
|
|
|
$
|
0.27
|
|
|
$
|
0.29
|
|
|
$
|
0.19
|
|
Diluted
|
$
|
0.15
|
|
|
$
|
0.27
|
|
|
$
|
0.29
|
|
|
$
|
0.19
|
|
Dividends declared
|
$
|
0.095
|
|
|
$
|
0.095
|
|
|
$
|
0.10
|
|
|
$
|
0.10
|
|
Stock price:
|
|
|
|
|
|
|
|
||||||||
High
|
$
|
30.68
|
|
|
$
|
32.94
|
|
|
$
|
32.21
|
|
|
$
|
31.00
|
|
Low
|
$
|
27.36
|
|
|
$
|
29.33
|
|
|
$
|
25.82
|
|
|
$
|
27.64
|
|
Quarter-end close
|
$
|
29.97
|
|
|
$
|
31.75
|
|
|
$
|
29.03
|
|
|
$
|
29.30
|
|
1.
|
Financial Statements. See the financial statements included in Part II, Item 8 “Financial Statements and Supplementary Data” in this 2016 Annual Report on Form 10-K, under the headings “Consolidated Balance Sheets,” “Consolidated Statements of Operations,” “Consolidated Statements of Comprehensive Income,” “Consolidated Statements of Cash Flows” and “Consolidated Statements of Shareholders' Equity.”
|
2.
|
Financial Statement Schedules. Financial statement schedules are omitted because the information required in these schedules is included in the Notes to Consolidated Financial Statements.
|
3.
|
Exhibits. See the Exhibit Index included in this 2016 Annual Report on Form 10-K that is incorporated herein by reference.
|
BADGER METER, INC.
|
||
|
|
|
By:
|
|
/s/ Richard A. Meeusen
|
|
|
Richard A. Meeusen
|
|
|
Chairman, President and Chief Executive Officer
|
Name
|
|
Title
|
|
|
|
/s/ Richard A. Meeusen
|
|
Chairman, President and
Chief Executive Officer and
Director (Principal executive officer)
|
Richard A. Meeusen
|
|
|
|
|
|
/s/ Richard E. Johnson
|
|
Senior Vice President — Finance,
Chief Financial Officer and Treasurer
(Principal financial officer)
|
Richard E. Johnson
|
|
|
|
|
|
/s/ Beverly L. P. Smiley
|
|
Vice President — Controller
(Principal accounting officer)
|
Beverly L. P. Smiley
|
|
|
|
|
|
/s/ Todd A. Adams
|
|
Director
|
Todd A. Adams
|
|
|
|
|
|
/s/ Ronald H. Dix
|
|
Director
|
Ronald H. Dix
|
|
|
|
|
|
/s/ Thomas J. Fischer
|
|
Director
|
Thomas J. Fischer
|
|
|
|
|
|
/s/ Gale E. Klappa
|
|
Director
|
Gale E. Klappa
|
|
|
|
|
|
/s/ Gail A. Lione
|
|
Director
|
Gail A. Lione
|
|
|
|
|
|
/s/ Andrew J. Policano
|
|
Director
|
Andrew J. Policano
|
|
|
|
|
|
/s/ Steven J. Smith
|
|
Director
|
Steven J. Smith
|
|
|
|
|
|
/s/ James F. Stern
|
|
Director
|
James F. Stern
|
|
|
|
|
|
/s/ Glen E. Tellock
|
|
Director
|
Glen E. Tellock
|
|
|
|
|
|
/s/ Todd J. Teske
|
|
Director
|
Todd J. Teske
|
|
EXHIBIT NO.
|
|
EXHIBIT DESCRIPTION
|
|
|
|
(3)
|
|
Restated Articles of Incorporation (as in effect as of August 8, 2008).
|
|
|
|
|
|
[Incorporated by reference to Exhibit (3.2) to Badger Meter, Inc.’s Quarterly Report on Form 10-Q for the period ended September 30, 2008 (Commission File No. 001-06706)].
|
|
|
|
(3.1)
|
|
Restated By-Laws (as amended and restated as of February 10, 2017).
|
|
|
|
(4)
|
|
Rights Agreement, dated February 15, 2008, between Badger Meter, Inc. and American Stock Transfer & Trust Company.
|
|
|
|
|
|
[Incorporated by reference to Exhibit (4.1) to Badger Meter, Inc.’s Current Report on Form 8-K, dated February 22, 2008 (Commission File No. 001-06706)].
|
|
|
|
(4.1)
|
|
Loan Agreement dated May 23, 2012 between Badger Meter, Inc. and BMO Harris Bank relating to Badger Meter, Inc.'s revolving credit agreement.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (4.1) to Badger Meter, Inc.'s Quarterly Report on Form 10-Q for the period ended June 30, 2012 (Commission File No. 001-06706)].
|
|
|
|
(4.2)
|
|
First Amendment to Credit Agreement dated May 21, 2013, related to the Loan Agreement dated May 23, 2012 between Badger Meter, Inc. and BMO Harris Bank NA for Badger Meter, Inc.'s credit agreement.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (4.1) to Badger Meter, Inc.'s Quarterly Report on Form 10-Q for the period ended June 30, 2013 (Commission File No. 001-06706)].
|
|
|
|
(4.3)
|
|
Second Amendment to Credit Agreement dated May 21, 2014, related to the Loan Agreement dated May 23, 2012 between Badger Meter, Inc. and BMO Harris Bank NA for Badger Meter, Inc.'s credit agreement.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (4.1) to Badger Meter, Inc.'s Quarterly Report on Form 10-Q for the period ended June 30, 2014 (Commission File No. 001-06706)].
|
|
|
|
(4.4)
|
|
Third Amendment to Credit Agreement dated September 30, 2016, related to the Loan Agreement dated May 23, 2012 between Badger Meter, Inc. and BMO Harris Bank NA for Badger Meter, Inc.'s credit agreement.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (4.1) to Badger Meter, Inc.'s Quarterly Report on Form 10-Q for the period ended September 30, 2016 (Commission File No. 001-06706)].
|
|
|
|
(4.5)
|
|
Certificate of Adjustment
|
|
|
|
|
|
[Incorporated by reference from Exhibit (4.1) to Badger Meter, Inc.’s Current Report on Form 8-K filed on September 21, 2016 (Commission File No. 001-06706).]Registration No. 33-62241)].
|
|
|
|
(10.0)*
|
|
Badger Meter, Inc. Employee Savings and Stock Ownership Plan.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (4.1) to Badger Meter, Inc.’s Form S-8 Registration Statement (Registration No. 33-62241)].
|
|
|
|
(10.3)*
|
|
Badger Meter, Inc. 2003 Stock Option Plan.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (4.1) to Badger Meter, Inc.’s Form S-8 Registration Statement (Registration No. 333-107850)].
|
|
|
|
(10.4)*
|
|
Form of the Key Executive Employment and Severance Agreements between Badger Meter, Inc. and the applicable executive officers.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (10.12) to Badger Meter, Inc.’s Annual Report on Form 10-K for the period ended December 31, 2008 (Commission File No. 001-06706)].
|
|
|
|
(10.5)*
|
|
Amended and Restated Badger Meter, Inc. Executive Supplemental Plan.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (10.13) to Badger Meter, Inc.’s Annual Report on Form 10-K for the period ended December 31, 2008 (Commission File No. 001-06706)].
|
EXHIBIT NO.
|
|
EXHIBIT DESCRIPTION
|
|
|
|
(10.6)*
|
|
Amended and Restated Badger Meter, Inc. Deferred Compensation Plan.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (10.14) to Badger Meter, Inc.’s Annual Report on Form 10-K for the period ended December 31, 2008 (Commission File No. 001-06706)].
|
|
|
|
(10.7)*
|
|
Amended and Restated Deferred Compensation Plan for Certain Directors.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (10.15) to Badger Meter, Inc.’s Annual Report on Form 10-K for the period ended December 31, 2008 (Commission File No. 001-06706)].
|
|
|
|
(10.8)*
|
|
Amended and Restated Executive Supplemental Plan II.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (10.16) to Badger Meter, Inc.’s Annual Report on Form 10-K for the period ended December 31, 2008 (Commission File No. 001-06706)].
|
|
|
|
(10.9)*
|
|
Badger Meter, Inc. 2011 Omnibus Incentive Plan.
|
|
|
|
|
|
[Incorporated by reference from Exhibit (4.1) to Badger Meter, Inc.’s Form S-8 Registration Statement (Registration No. 333-173966)].
|
|
|
|
(10.10)*
|
|
Form of Nonqualified Stock Option Agreement under Badger Meter, Inc. 2011 Omnibus Incentive Plan.
|
|
|
|
|
|
[Incorporated by reference from Badger Meter, Inc.’s Form 8-K dated April 29, 2011 (Commission No. 001-06760)].
|
|
|
|
(10.11)*
|
|
Form of Restricted Stock Award Agreement under Badger Meter, Inc. 2011 Omnibus Incentive Plan.
|
|
|
|
|
|
[Incorporated by reference from Badger Meter, Inc.’s Form 8-K dated April 29, 2011 (Commission No. 001-06760)].
|
|
|
|
(21)
|
|
Subsidiaries of the Registrant.
|
|
|
|
(23)
|
|
Consent of Ernst & Young LLP.
|
|
|
|
(31.1)
|
|
Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
(31.2)
|
|
Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
(32)
|
|
Certification of Periodic Financial Report by the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
(99)
|
|
Definitive Proxy Statement for the Annual Meeting of Shareholders to be held April 28, 2017. To be filed with the Securities and Exchange Commission under Regulation 14A within 120 days after the end of the Registrant’s fiscal year. With the exception of the information incorporated by reference into Items 10, 11, 12, 13 and 14 of this Annual Report on Form 10-K, the definitive Proxy Statement is not deemed filed as part of this report.
|
|
|
|
(101)
|
|
The following materials from the Company's Annual Report on Form 10-K for the year ended December 31, 2016 formatted in Extensible Business Reporting Language (XBRL): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Cash Flows, (v) the Consolidated Statements of Shareholders' Equity, (vi) Notes to Consolidated Financial Statements, tagged as blocks of text and (vii) document and entity information.
|
*
|
A management contract or compensatory plan or arrangement.
|
Name
|
Percentage of Ownership
|
|
State or country in which originated
|
|
|
|
|
Badger Meter de las Americas, SA de CV
|
100%
|
|
Mexico
|
|
|
|
|
Badger Meter Canada, Inc.
|
100%
|
|
Canada
|
|
|
|
|
Badger Meter Czech Republic, s.r.o.
|
100%
|
|
Czech Republic
|
(a subsidiary of Badger Meter International, Inc.)
|
|
|
|
|
|
|
|
Badger Meter Europe, GmbH
|
100%
|
|
Federal Republic of Germany
|
|
|
|
|
Badger Meter International, Inc.
|
100%
|
|
United States of America (Wisconsin)
|
(an international holding company of Badger Meter, Inc.)
|
|
|
|
|
|
|
|
Badger Meter de Mexico, SA de CV
|
100%
|
|
Mexico
|
|
|
|
|
Badger Meter Slovakia, s.r.o.
|
100%
|
|
Slovakia
|
(a subsidiary of Badger Meter Europe, GmbH)
|
|
|
|
|
|
|
|
Badger Meter Swiss, AG
|
100%
|
|
Switzerland
|
(formerly Remag AG) (a subsidiary of Badger Meter International, Inc.)
|
|
|
|
|
|
|
|
National Meter and Automation, Inc. *
|
100%
|
|
United States of America (Colorado)
|
(1)
|
Registration Statement (Form S-8 No. 33-62241) pertaining to the Badger Meter, Inc. Employee Savings and Stock Plan;
|
(2)
|
Registration Statement (Form S-8 No. 333-107850) pertaining to the Badger Meter, Inc 2003 Stock Option Plan;
|
(3)
|
Registration Statement (Form S-8 No. 333-173966) pertaining to the Badger Meter, Inc. 2011 Omnibus Incentive Plan; and
|
(4)
|
Registration Statement (Form S-3 No. 333-202493) pertaining to the Badger Meter, Inc. Dividend Reinvestment and Stock Purchase Plan.
|
|
|
|
/s/ Ernst & Young LLP
|
|
Milwaukee, Wisconsin
|
|
|
|
|
February 28, 2017
|
|
|
|
|
1.
|
I have reviewed this Annual Report on Form 10-K of Badger Meter, 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 the circumstances under which such 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(s) 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 have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) 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):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 28, 2017
|
By
|
|
/s/ Richard A. Meeusen
|
|
|
|
Richard A. Meeusen
|
|
|
|
Chairman, President and Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K of Badger Meter, 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 the circumstances under which such 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(s) 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 have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) 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):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: February 28, 2017
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By
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/s/ Richard E. Johnson
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Richard E. Johnson
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Senior Vice President - Finance,
Chief Financial Officer and Treasurer
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Dated: February 28, 2017
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By
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/s/ Richard A. Meeusen
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Richard A. Meeusen
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Chairman, President and Chief Executive Officer
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By
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/s/ Richard E. Johnson
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Richard E. Johnson
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Senior Vice President - Finance,
Chief Financial Officer and Treasurer
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