x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
06-0247840
|
|
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
|
|
|
|
|||
123 Main Street, Bristol, Connecticut
|
|
06010
|
|
|
(Address of Principal Executive Offices)
|
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(Zip Code)
|
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Large accelerated filer
x
|
Accelerated filer
¨
|
Non-accelerated filer
¨
|
Smaller reporting company
¨
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Page
|
Part I.
|
FINANCIAL INFORMATION
|
|
|
|
|
Item 1.
|
||
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||
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||
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||
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||
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||
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||
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Item 2.
|
||
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Item 3.
|
||
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Item 4.
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||
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Part II.
|
OTHER INFORMATION
|
|
|
|
|
Item 1.
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 6.
|
||
|
|
|
|
||
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Net sales
|
$
|
322,074
|
|
|
$
|
267,394
|
|
|
$
|
634,173
|
|
|
$
|
530,940
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of sales
|
211,705
|
|
|
177,411
|
|
|
426,261
|
|
|
355,127
|
|
||||
Selling and administrative expenses
|
64,988
|
|
|
53,834
|
|
|
127,406
|
|
|
114,708
|
|
||||
|
276,693
|
|
|
231,245
|
|
|
553,667
|
|
|
469,835
|
|
||||
Operating income
|
45,381
|
|
|
36,149
|
|
|
80,506
|
|
|
61,105
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
2,804
|
|
|
3,241
|
|
|
6,123
|
|
|
7,598
|
|
||||
Other expense (income), net
|
792
|
|
|
495
|
|
|
1,027
|
|
|
1,462
|
|
||||
Income from continuing operations before income taxes
|
41,785
|
|
|
32,413
|
|
|
73,356
|
|
|
52,045
|
|
||||
Income taxes
|
11,557
|
|
|
23,218
|
|
|
20,375
|
|
|
27,417
|
|
||||
Income from continuing operations
|
30,228
|
|
|
9,195
|
|
|
52,981
|
|
|
24,628
|
|
||||
Income from discontinued operations, net of income taxes (Note 2)
|
—
|
|
|
200,132
|
|
|
—
|
|
|
198,171
|
|
||||
Net income
|
$
|
30,228
|
|
|
$
|
209,327
|
|
|
$
|
52,981
|
|
|
$
|
222,799
|
|
|
|
|
|
|
|
|
|
||||||||
Per common share:
|
|
|
|
|
|
|
|
||||||||
Basic:
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
$
|
0.55
|
|
|
$
|
0.18
|
|
|
$
|
0.97
|
|
|
$
|
0.46
|
|
Income from discontinued operations, net of income taxes
|
—
|
|
|
3.72
|
|
|
—
|
|
|
3.65
|
|
||||
Net income
|
$
|
0.55
|
|
|
$
|
3.90
|
|
|
$
|
0.97
|
|
|
$
|
4.11
|
|
Diluted:
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
$
|
0.54
|
|
|
$
|
0.17
|
|
|
$
|
0.95
|
|
|
$
|
0.45
|
|
Income from discontinued operations, net of income taxes
|
—
|
|
|
3.65
|
|
|
—
|
|
|
3.59
|
|
||||
Net income
|
$
|
0.54
|
|
|
$
|
3.82
|
|
|
$
|
0.95
|
|
|
$
|
4.04
|
|
Dividends
|
$
|
0.11
|
|
|
$
|
0.10
|
|
|
$
|
0.22
|
|
|
$
|
0.20
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
54,740,750
|
|
|
53,738,051
|
|
|
54,695,865
|
|
|
54,230,272
|
|
||||
Diluted
|
55,927,881
|
|
|
54,809,896
|
|
|
55,950,467
|
|
|
55,135,892
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Net income
|
$
|
30,228
|
|
|
$
|
209,327
|
|
|
$
|
52,981
|
|
|
$
|
222,799
|
|
Other comprehensive (loss) income, net of tax
|
|
|
|
|
|
|
|
||||||||
Unrealized (loss) gain on hedging activities, net of tax (1)
|
(502
|
)
|
|
(81
|
)
|
|
(529
|
)
|
|
346
|
|
||||
Foreign currency translation adjustments, net of tax (2)
|
(4,612
|
)
|
|
2,976
|
|
|
(10,560
|
)
|
|
(11,529
|
)
|
||||
Defined benefit pension and other postretirement benefits, net of tax (3)
|
1,489
|
|
|
15,529
|
|
|
(4,381
|
)
|
|
17,939
|
|
||||
Total other comprehensive (loss) income, net of tax
|
(3,625
|
)
|
|
18,424
|
|
|
(15,470
|
)
|
|
6,756
|
|
||||
Total comprehensive income
|
$
|
26,603
|
|
|
$
|
227,751
|
|
|
$
|
37,511
|
|
|
$
|
229,555
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
62,240
|
|
|
$
|
70,856
|
|
Accounts receivable, less allowances (2014 - $3,317; 2013 - $3,438)
|
298,020
|
|
|
258,664
|
|
||
Inventories
|
217,196
|
|
|
211,246
|
|
||
Deferred income taxes
|
16,013
|
|
|
18,226
|
|
||
Prepaid expenses and other current assets
|
19,950
|
|
|
18,204
|
|
||
Total current assets
|
613,419
|
|
|
577,196
|
|
||
|
|
|
|
||||
Deferred income taxes
|
32
|
|
|
2,314
|
|
||
|
|
|
|
||||
Property, plant and equipment
|
705,992
|
|
|
686,537
|
|
||
Less accumulated depreciation
|
(399,380
|
)
|
|
(383,979
|
)
|
||
|
306,612
|
|
|
302,558
|
|
||
|
|
|
|
||||
Goodwill
|
640,585
|
|
|
649,697
|
|
||
Other intangible assets, net
|
591,747
|
|
|
534,293
|
|
||
Other assets
|
62,229
|
|
|
57,615
|
|
||
Total assets
|
$
|
2,214,624
|
|
|
$
|
2,123,673
|
|
|
|
|
|
||||
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Notes and overdrafts payable
|
$
|
12,265
|
|
|
$
|
1,074
|
|
Accounts payable
|
101,380
|
|
|
88,721
|
|
||
Accrued liabilities
|
174,278
|
|
|
154,514
|
|
||
Long-term debt - current
|
56,706
|
|
|
56,009
|
|
||
Total current liabilities
|
344,629
|
|
|
300,318
|
|
||
|
|
|
|
||||
Long-term debt
|
501,945
|
|
|
490,341
|
|
||
Accrued retirement benefits
|
90,072
|
|
|
80,884
|
|
||
Deferred income taxes
|
88,996
|
|
|
94,506
|
|
||
Other liabilities
|
15,283
|
|
|
16,210
|
|
||
|
|
|
|
||||
Commitments and contingencies (Note 15)
|
|
|
|
||||
Stockholders' equity
|
|
|
|
||||
Common stock - par value $0.01 per share
Authorized: 150,000,000 shares
Issued: at par value (2014 - 60,893,489 shares; 2013 - 60,306,128 shares)
|
609
|
|
|
603
|
|
||
Additional paid-in capital
|
406,437
|
|
|
390,347
|
|
||
Treasury stock, at cost (2014 - 6,631,583 shares; 2013 - 6,389,267 shares)
|
(165,844
|
)
|
|
(156,649
|
)
|
||
Retained earnings
|
922,023
|
|
|
881,169
|
|
||
Accumulated other non-owner changes to equity
|
10,474
|
|
|
25,944
|
|
||
Total stockholders' equity
|
1,173,699
|
|
|
1,141,414
|
|
||
Total liabilities and stockholders' equity
|
$
|
2,214,624
|
|
|
$
|
2,123,673
|
|
|
Six months ended June 30,
|
||||||
|
2014
|
|
2013
|
||||
Operating activities:
|
|
|
|
||||
Net income
|
$
|
52,981
|
|
|
$
|
222,799
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
42,515
|
|
|
31,110
|
|
||
Amortization of convertible debt discount
|
731
|
|
|
1,173
|
|
||
Loss on disposition of property, plant and equipment
|
78
|
|
|
56
|
|
||
Stock compensation expense
|
4,108
|
|
|
14,348
|
|
||
Withholding taxes paid on stock issuances
|
(806
|
)
|
|
(753
|
)
|
||
Gain on the sale of businesses
|
—
|
|
|
(313,477
|
)
|
||
Changes in assets and liabilities, net of the effects of divestitures:
|
|
|
|
||||
Accounts receivable
|
(39,359
|
)
|
|
(17,951
|
)
|
||
Inventories
|
(6,409
|
)
|
|
(8,026
|
)
|
||
Prepaid expenses and other current assets
|
(3,204
|
)
|
|
250
|
|
||
Accounts payable
|
12,796
|
|
|
7,620
|
|
||
Accrued liabilities
|
2,934
|
|
|
132,508
|
|
||
Deferred income taxes
|
1,307
|
|
|
(10,066
|
)
|
||
Long-term retirement benefits
|
(4,326
|
)
|
|
(166
|
)
|
||
Other
|
1,567
|
|
|
6,061
|
|
||
Net cash provided by operating activities
|
64,913
|
|
|
65,486
|
|
||
|
|
|
|
||||
Investing activities:
|
|
|
|
||||
Proceeds from disposition of property, plant and equipment
|
474
|
|
|
160
|
|
||
(Payments for) proceeds from the sale of businesses
|
(1,181
|
)
|
|
541,032
|
|
||
Capital expenditures
|
(25,802
|
)
|
|
(20,419
|
)
|
||
Component Repair Program payments
|
(41,000
|
)
|
|
—
|
|
||
Other
|
(858
|
)
|
|
(1,748
|
)
|
||
Net cash (used) provided by investing activities
|
(68,367
|
)
|
|
519,025
|
|
||
|
|
|
|
||||
Financing activities:
|
|
|
|
||||
Net change in other borrowings
|
11,186
|
|
|
9,092
|
|
||
Payments on long-term debt
|
(78,467
|
)
|
|
(478,005
|
)
|
||
Proceeds from the issuance of long-term debt
|
90,383
|
|
|
65,500
|
|
||
Payment of assumed liability to Otto Männer Holding AG
|
(19,796
|
)
|
|
—
|
|
||
Proceeds from the issuance of common stock
|
9,395
|
|
|
3,763
|
|
||
Common stock repurchases
|
(8,389
|
)
|
|
(61,432
|
)
|
||
Dividends paid
|
(11,937
|
)
|
|
(10,720
|
)
|
||
Excess tax benefit on stock awards
|
2,671
|
|
|
632
|
|
||
Other
|
(137
|
)
|
|
(111
|
)
|
||
Net cash used by financing activities
|
(5,091
|
)
|
|
(471,281
|
)
|
||
|
|
|
|
||||
Effect of exchange rate changes on cash flows
|
(71
|
)
|
|
(2,188
|
)
|
||
(Decrease) increase in cash and cash equivalents
|
(8,616
|
)
|
|
111,042
|
|
||
Cash and cash equivalents at beginning of period
|
70,856
|
|
|
86,356
|
|
||
Cash and cash equivalents at end of period
|
$
|
62,240
|
|
|
$
|
197,398
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Net sales
|
$
|
—
|
|
|
$
|
17,352
|
|
|
$
|
—
|
|
|
$
|
93,173
|
|
Income before income taxes
|
—
|
|
|
6,735
|
|
|
—
|
|
|
4,957
|
|
||||
Income tax expense
|
—
|
|
|
1,041
|
|
|
—
|
|
|
1,224
|
|
||||
Income from operations of discontinued businesses, net of income taxes
|
—
|
|
|
5,694
|
|
|
—
|
|
|
3,733
|
|
||||
Gain on transaction
|
—
|
|
|
313,477
|
|
|
—
|
|
|
313,477
|
|
||||
Income tax expense on sale
|
—
|
|
|
(119,039
|
)
|
|
—
|
|
|
(119,039
|
)
|
||||
Gain on the sale of businesses
|
—
|
|
|
194,438
|
|
|
—
|
|
|
194,438
|
|
||||
Income from discontinued operations, net of income taxes
|
$
|
—
|
|
|
$
|
200,132
|
|
|
$
|
—
|
|
|
$
|
198,171
|
|
|
(Unaudited Pro Forma) Three months ended June 30, 2013
|
|
(Unaudited Pro Forma) Six months ended June 30, 2013
|
||||
Net sales
|
$
|
304,501
|
|
|
$
|
591,335
|
|
Income from continuing operations
|
14,269
|
|
|
32,198
|
|
||
Net income
|
214,401
|
|
|
230,369
|
|
||
|
|
|
|
||||
Per common share:
|
|
|
|
||||
Basic:
|
|
|
|
||||
Income from continuing operations
|
$
|
0.26
|
|
|
$
|
0.58
|
|
Net income
|
$
|
3.91
|
|
|
$
|
4.17
|
|
Diluted:
|
|
|
|
||||
Income from continuing operations
|
$
|
0.26
|
|
|
$
|
0.57
|
|
Net income
|
$
|
3.84
|
|
|
$
|
4.10
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||
Finished goods
|
$
|
86,035
|
|
|
$
|
85,033
|
|
Work-in-process
|
77,887
|
|
|
71,982
|
|
||
Raw material and supplies
|
53,274
|
|
|
54,231
|
|
||
|
$
|
217,196
|
|
|
$
|
211,246
|
|
|
Industrial
|
|
Aerospace
|
|
Total Company
|
||||||
January 1, 2014
|
$
|
618,911
|
|
|
$
|
30,786
|
|
|
$
|
649,697
|
|
Foreign currency translation
|
(9,112
|
)
|
|
—
|
|
|
(9,112
|
)
|
|||
June 30, 2014
|
$
|
609,799
|
|
|
$
|
30,786
|
|
|
$
|
640,585
|
|
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
|
Range of
Life -Years
|
|
Gross Amount
|
|
Accumulated Amortization
|
|
Gross Amount
|
|
Accumulated Amortization
|
||||||||
Amortized intangible assets:
|
|
|
|
|
|
|
|
|
|
||||||||
Revenue sharing programs (RSPs)
|
Up to 30
|
|
$
|
293,700
|
|
|
$
|
(68,839
|
)
|
|
$
|
293,700
|
|
|
$
|
(64,220
|
)
|
Component repair programs (CRPs)
|
Up to 18
|
|
106,639
|
|
|
(576
|
)
|
|
26,639
|
|
|
—
|
|
||||
Customer lists/relationships
|
10-18
|
|
183,406
|
|
|
(24,604
|
)
|
|
183,406
|
|
|
(18,293
|
)
|
||||
Patents and technology
|
7-14
|
|
62,972
|
|
|
(18,326
|
)
|
|
62,972
|
|
|
(14,210
|
)
|
||||
Trademarks/trade names
|
5-30
|
|
11,950
|
|
|
(8,108
|
)
|
|
11,950
|
|
|
(7,628
|
)
|
||||
Other
|
Up to 15
|
|
19,292
|
|
|
(13,412
|
)
|
|
19,292
|
|
|
(9,868
|
)
|
||||
|
|
|
677,959
|
|
|
(133,865
|
)
|
|
597,959
|
|
|
(114,219
|
)
|
||||
Unamortized intangible asset:
|
|
|
|
|
|
|
|
|
|
||||||||
Trade names
|
|
|
36,900
|
|
|
|
|
|
36,900
|
|
|
|
|
||||
Foreign currency translation
|
|
|
10,753
|
|
|
—
|
|
|
13,653
|
|
|
—
|
|
||||
Other intangible assets
|
|
|
$
|
725,612
|
|
|
$
|
(133,865
|
)
|
|
$
|
648,512
|
|
|
$
|
(114,219
|
)
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
|
|
Carrying
Amount
|
|
Fair
Value
|
|
Carrying
Amount
|
|
Fair
Value
|
||||||||
3.375% Convertible Notes
|
|
$
|
55,636
|
|
|
$
|
75,845
|
|
|
$
|
55,636
|
|
|
$
|
76,569
|
|
Unamortized debt discount – 3.375% Convertible Notes
|
|
—
|
|
|
—
|
|
|
(731
|
)
|
|
—
|
|
||||
Revolving credit agreement
|
|
498,842
|
|
|
508,354
|
|
|
487,920
|
|
|
482,431
|
|
||||
Borrowings under lines of credit and overdrafts
|
|
12,265
|
|
|
12,265
|
|
|
1,074
|
|
|
1,074
|
|
||||
Other foreign bank borrowings
|
|
135
|
|
|
136
|
|
|
405
|
|
|
410
|
|
||||
Capital leases
|
|
4,038
|
|
|
4,431
|
|
|
3,120
|
|
|
3,402
|
|
||||
|
|
570,916
|
|
|
601,031
|
|
|
547,424
|
|
|
563,886
|
|
||||
Less current maturities
|
|
(68,971
|
)
|
|
|
|
(57,083
|
)
|
|
|
||||||
Long-term debt
|
|
$
|
501,945
|
|
|
|
|
$
|
490,341
|
|
|
|
|
|
||
January 1, 2014
|
$
|
—
|
|
Employee severance costs
|
1,166
|
|
|
Payments
|
(681
|
)
|
|
June 30, 2014
|
$
|
485
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
|
Asset Derivatives
|
|
Liability Derivatives
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
||||||||
Interest rate contracts
|
$
|
—
|
|
|
$
|
(597
|
)
|
|
$
|
—
|
|
|
$
|
(370
|
)
|
Foreign exchange contracts
|
—
|
|
|
(816
|
)
|
|
—
|
|
|
(318
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
51
|
|
|
(607
|
)
|
|
543
|
|
|
(67
|
)
|
||||
Total derivatives
|
$
|
51
|
|
|
$
|
(2,020
|
)
|
|
$
|
543
|
|
|
$
|
(755
|
)
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Cash flow hedges:
|
|
|
|
|
|
|
|
||||||||
Interest rate contracts
|
$
|
(213
|
)
|
|
$
|
911
|
|
|
$
|
(142
|
)
|
|
$
|
1,067
|
|
Foreign exchange contracts
|
(289
|
)
|
|
(992
|
)
|
|
(387
|
)
|
|
(721
|
)
|
||||
|
$
|
(502
|
)
|
|
$
|
(81
|
)
|
|
$
|
(529
|
)
|
|
$
|
346
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Foreign exchange contracts
|
$
|
(241
|
)
|
|
$
|
425
|
|
|
$
|
(988
|
)
|
|
$
|
(3,481
|
)
|
Level 1
|
Unadjusted quoted prices in active markets for identical assets or liabilities
|
Level 2
|
Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability
|
Level 3
|
Unobservable inputs for the asset or liability
|
|
|
|
|
Fair Value Measurements Using
|
||||||||||||
Description
|
|
Total
|
|
Quoted Prices in Active Markets for
Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
June 30, 2014
|
|
|
|
|
|
|
|
|
||||||||
Asset derivatives
|
|
$
|
51
|
|
|
$
|
—
|
|
|
$
|
51
|
|
|
$
|
—
|
|
Liability derivatives
|
|
(2,020
|
)
|
|
—
|
|
|
(2,020
|
)
|
|
—
|
|
||||
Bank acceptances
|
|
5,859
|
|
|
—
|
|
|
5,859
|
|
|
—
|
|
||||
Rabbi trust assets
|
|
2,113
|
|
|
2,123
|
|
|
—
|
|
|
—
|
|
||||
|
|
$
|
6,003
|
|
|
$
|
2,123
|
|
|
$
|
3,890
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
||||||||
Asset derivatives
|
|
$
|
543
|
|
|
$
|
—
|
|
|
$
|
543
|
|
|
$
|
—
|
|
Liability derivatives
|
|
(755
|
)
|
|
—
|
|
|
(755
|
)
|
|
—
|
|
||||
Bank acceptances
|
|
6,461
|
|
|
—
|
|
|
6,461
|
|
|
—
|
|
||||
Rabbi trust assets
|
|
1,975
|
|
|
1,975
|
|
|
—
|
|
|
—
|
|
||||
|
|
$
|
8,224
|
|
|
$
|
1,975
|
|
|
$
|
6,249
|
|
|
$
|
—
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
Pensions
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Service cost
|
$
|
1,052
|
|
|
$
|
1,462
|
|
|
$
|
2,307
|
|
|
$
|
3,446
|
|
Interest cost
|
5,540
|
|
|
5,038
|
|
|
10,978
|
|
|
10,025
|
|
||||
Expected return on plan assets
|
(8,483
|
)
|
|
(8,318
|
)
|
|
(17,053
|
)
|
|
(16,594
|
)
|
||||
Amortization of prior service cost
|
157
|
|
|
179
|
|
|
334
|
|
|
382
|
|
||||
Amortization of actuarial losses
|
2,270
|
|
|
4,218
|
|
|
4,232
|
|
|
8,293
|
|
||||
Curtailment loss
|
—
|
|
|
—
|
|
|
219
|
|
|
199
|
|
||||
Settlement loss
|
582
|
|
|
637
|
|
|
582
|
|
|
637
|
|
||||
Special termination benefits
|
—
|
|
|
1,016
|
|
|
715
|
|
|
1,016
|
|
||||
Net periodic benefit cost
|
$
|
1,118
|
|
|
$
|
4,232
|
|
|
$
|
2,314
|
|
|
$
|
7,404
|
|
|
|
|
|
|
|
|
|
||||||||
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
Other Postretirement Benefits
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Service cost
|
$
|
29
|
|
|
$
|
41
|
|
|
$
|
81
|
|
|
$
|
118
|
|
Interest cost
|
540
|
|
|
492
|
|
|
1,099
|
|
|
1,035
|
|
||||
Amortization of prior service credit
|
(218
|
)
|
|
(165
|
)
|
|
(435
|
)
|
|
(560
|
)
|
||||
Amortization of actuarial losses
|
267
|
|
|
231
|
|
|
483
|
|
|
521
|
|
||||
Curtailment loss (gain)
|
—
|
|
|
(3,081
|
)
|
|
4
|
|
|
(3,081
|
)
|
||||
Net periodic benefit cost
|
$
|
618
|
|
|
$
|
(2,482
|
)
|
|
$
|
1,232
|
|
|
$
|
(1,967
|
)
|
|
Gains and Losses on Cash Flow Hedges
|
|
Pension and Other Postretirement Benefit Items
|
|
Foreign Currency Items
|
|
Total
|
||||||||
January 1, 2014
|
$
|
(519
|
)
|
|
$
|
(73,273
|
)
|
|
$
|
99,736
|
|
|
$
|
25,944
|
|
Other comprehensive loss before reclassifications to consolidated statements of income
|
(820
|
)
|
|
(8,133
|
)
|
|
(10,560
|
)
|
|
(19,513
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income
|
291
|
|
|
3,752
|
|
|
—
|
|
|
4,043
|
|
||||
Net current-period other comprehensive loss
|
(529
|
)
|
|
(4,381
|
)
|
|
(10,560
|
)
|
|
(15,470
|
)
|
||||
June 30, 2014
|
$
|
(1,048
|
)
|
|
$
|
(77,654
|
)
|
|
$
|
89,176
|
|
|
$
|
10,474
|
|
|
Gains and Losses on Cash Flow Hedges
|
|
Pension and Other Postretirement Benefit Items
|
|
Foreign Currency Items
|
|
Total
|
||||||||
January 1, 2013
|
$
|
(432
|
)
|
|
$
|
(146,441
|
)
|
|
$
|
80,121
|
|
|
$
|
(66,752
|
)
|
Other comprehensive income (loss) before reclassifications to consolidated statements of income
|
500
|
|
|
13,537
|
|
|
(15,672
|
)
|
|
(1,635
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income to the consolidated statements of income
|
(154
|
)
|
|
4,402
|
|
|
4,143
|
|
|
8,391
|
|
||||
Net current-period other comprehensive income (loss)
|
346
|
|
|
17,939
|
|
|
(11,529
|
)
|
|
6,756
|
|
||||
June 30, 2013
|
$
|
(86
|
)
|
|
$
|
(128,502
|
)
|
|
$
|
68,592
|
|
|
$
|
(59,996
|
)
|
Details about Accumulated Other Comprehensive Income Components
|
|
Amount Reclassified from Accumulated Other Comprehensive Income
|
Affected Line Item in the Consolidated Statements of Income
|
|||||||
|
|
Three months ended June 30, 2014
|
|
Three months ended June 30, 2013
|
|
|
||||
Gains and losses on cash flow hedges
|
|
|
|
|
|
|
||||
Interest rate contracts
|
|
$
|
(222
|
)
|
|
$
|
(212
|
)
|
|
Interest expense
|
Foreign exchange contracts
|
|
(42
|
)
|
|
243
|
|
|
Net sales
|
||
|
|
(264
|
)
|
|
31
|
|
|
Total before tax
|
||
|
|
92
|
|
|
26
|
|
|
Tax benefit
|
||
|
|
(172
|
)
|
|
57
|
|
|
Net of tax
|
||
|
|
|
|
|
|
|
||||
Pension and other postretirement benefit items
|
|
|
|
|
|
|
||||
Amortization of prior-service credits (costs), net
|
|
61
|
|
|
$
|
(14
|
)
|
|
(A)
|
|
Amortization of actuarial losses
|
|
(2,537
|
)
|
|
(4,449
|
)
|
|
(A)
|
||
Curtailment gain
|
|
—
|
|
|
3,081
|
|
|
(A)
|
||
Settlement loss
|
|
(582
|
)
|
|
(637
|
)
|
|
(A)
|
||
|
|
(3,058
|
)
|
|
(2,019
|
)
|
|
Total before tax
|
||
|
|
855
|
|
|
415
|
|
|
Tax benefit
|
||
|
|
(2,203
|
)
|
|
(1,604
|
)
|
|
Net of tax
|
||
|
|
|
|
|
|
|
||||
Foreign currency items
|
|
|
|
|
|
|
||||
Charge to cumulative translation adjustment (sale of BDNA)
|
|
$
|
—
|
|
|
$
|
(4,143
|
)
|
|
Income from discontinued operations
|
|
|
—
|
|
|
—
|
|
|
Tax benefit
|
||
|
|
—
|
|
|
(4,143
|
)
|
|
Net of tax
|
||
Total reclassifications in the period
|
|
$
|
(2,375
|
)
|
|
$
|
(5,690
|
)
|
|
|
Details about Accumulated Other Comprehensive Income Components
|
|
Amount Reclassified from Accumulated Other Comprehensive Income
|
Affected Line Item in the Consolidated Statements of Income
|
|||||||
|
|
Six months ended June 30, 2014
|
|
Six months ended June 30, 2013
|
|
|
||||
Gains and losses on cash flow hedges
|
|
|
|
|
|
|
||||
Interest rate contracts
|
|
$
|
(439
|
)
|
|
$
|
(411
|
)
|
|
Interest expense
|
Foreign exchange contracts
|
|
(20
|
)
|
|
527
|
|
|
Net sales
|
||
|
|
(459
|
)
|
|
116
|
|
|
Total before tax
|
||
|
|
168
|
|
|
38
|
|
|
Tax benefit
|
||
|
|
(291
|
)
|
|
154
|
|
|
Net of tax
|
||
|
|
|
|
|
|
|
||||
Pension and other postretirement benefit items
|
|
|
|
|
|
|
||||
Amortization of prior service credits, net
|
|
$
|
101
|
|
|
$
|
178
|
|
|
(A)
|
Amortization of actuarial losses
|
|
(4,715
|
)
|
|
(8,814
|
)
|
|
(A)
|
||
Curtailment (loss) gain (net)
|
|
(223
|
)
|
|
2,882
|
|
|
(A)
|
||
Settlement loss
|
|
(582
|
)
|
|
(637
|
)
|
|
(A)
|
||
|
|
(5,419
|
)
|
|
(6,391
|
)
|
|
Total before tax
|
||
|
|
1,667
|
|
|
1,989
|
|
|
Tax benefit
|
||
|
|
(3,752
|
)
|
|
(4,402
|
)
|
|
Net of tax
|
||
|
|
|
|
|
|
|
||||
Foreign currency items
|
|
|
|
|
|
|
||||
Charge to cumulative translation adjustment (sale of BDNA)
|
|
$
|
—
|
|
|
$
|
(4,143
|
)
|
|
Income from discontinued operations
|
|
|
—
|
|
|
—
|
|
|
Tax benefit
|
||
|
|
—
|
|
|
(4,143
|
)
|
|
Net of tax
|
||
Total reclassifications in the period
|
|
$
|
(4,043
|
)
|
|
$
|
(8,391
|
)
|
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Net sales
|
|
|
|
|
|
|
|
||||||||
Industrial
|
$
|
212,768
|
|
|
$
|
170,560
|
|
|
416,656
|
|
|
336,062
|
|
||
Aerospace
|
109,310
|
|
|
96,834
|
|
|
217,521
|
|
|
194,878
|
|
||||
Intersegment sales
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
||||
Total net sales
|
$
|
322,074
|
|
|
$
|
267,394
|
|
|
$
|
634,173
|
|
|
$
|
530,940
|
|
|
|
|
|
|
|
|
|
||||||||
Operating profit
|
|
|
|
|
|
|
|
||||||||
Industrial
|
$
|
28,765
|
|
|
$
|
20,923
|
|
|
48,140
|
|
|
35,532
|
|
||
Aerospace
|
16,616
|
|
|
15,226
|
|
|
32,366
|
|
|
25,573
|
|
||||
Total operating profit
|
45,381
|
|
|
36,149
|
|
|
80,506
|
|
|
61,105
|
|
||||
Interest expense
|
2,804
|
|
|
3,241
|
|
|
6,123
|
|
|
7,598
|
|
||||
Other expense (income), net
|
792
|
|
|
495
|
|
|
1,027
|
|
|
1,462
|
|
||||
Income from continuing operations before income taxes
|
$
|
41,785
|
|
|
$
|
32,413
|
|
|
$
|
73,356
|
|
|
$
|
52,045
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||
Assets
|
|
|
|
||||
Industrial
|
$
|
1,414,500
|
|
|
$
|
1,410,400
|
|
Aerospace
|
658,948
|
|
|
567,080
|
|
||
Other
(A)
|
141,176
|
|
|
146,193
|
|
||
Total assets
|
$
|
2,214,624
|
|
|
$
|
2,123,673
|
|
/s/ PricewaterhouseCoopers LLP
|
|
PricewaterhouseCoopers LLP
Hartford, Connecticut
|
|
July 28, 2014
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||||||||||||||||
(in millions)
|
2014
|
|
2013
|
|
Change
|
|
2014
|
|
2013
|
|
Change
|
||||||||||||||||||
Industrial
|
212.8
|
|
|
170.6
|
|
|
42.2
|
|
|
24.7
|
%
|
|
416.7
|
|
|
336.1
|
|
|
80.6
|
|
|
24.0
|
%
|
||||||
Aerospace
|
$
|
109.3
|
|
|
$
|
96.8
|
|
|
$
|
12.5
|
|
|
12.9
|
%
|
|
$
|
217.5
|
|
|
$
|
194.9
|
|
|
$
|
22.6
|
|
|
11.6
|
%
|
Intersegment sales
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
||||||
Total
|
$
|
322.1
|
|
|
$
|
267.4
|
|
|
$
|
54.7
|
|
|
20.4
|
%
|
|
$
|
634.2
|
|
|
$
|
530.9
|
|
|
$
|
103.2
|
|
|
19.4
|
%
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||||||||||||||||
(in millions)
|
2014
|
|
2013
|
|
Change
|
|
2014
|
|
2013
|
|
Change
|
||||||||||||||||||
Cost of sales
|
$
|
211.7
|
|
|
$
|
177.4
|
|
|
$
|
34.3
|
|
|
19.3
|
%
|
|
$
|
426.3
|
|
|
$
|
355.1
|
|
|
$
|
71.1
|
|
|
20.0
|
%
|
% sales
|
65.7
|
%
|
|
66.3
|
%
|
|
|
|
|
|
67.2
|
%
|
|
66.9
|
%
|
|
|
|
|
||||||||||
Gross profit
(1)
|
$
|
110.4
|
|
|
$
|
90.0
|
|
|
$
|
20.4
|
|
|
22.7
|
%
|
|
$
|
207.9
|
|
|
$
|
175.8
|
|
|
$
|
32.1
|
|
|
18.3
|
%
|
% sales
|
34.3
|
%
|
|
33.7
|
%
|
|
|
|
|
|
32.8
|
%
|
|
33.1
|
%
|
|
|
|
|
||||||||||
Selling and administrative expenses
|
$
|
65.0
|
|
|
$
|
53.8
|
|
|
$
|
11.2
|
|
|
20.7
|
%
|
|
$
|
127.4
|
|
|
$
|
114.7
|
|
|
$
|
12.7
|
|
|
11.1
|
%
|
% sales
|
20.2
|
%
|
|
20.1
|
%
|
|
|
|
|
|
20.1
|
%
|
|
21.6
|
%
|
|
|
|
|
||||||||||
Operating income
|
$
|
45.4
|
|
|
$
|
36.1
|
|
|
$
|
9.2
|
|
|
25.5
|
%
|
|
$
|
80.5
|
|
|
$
|
61.1
|
|
|
$
|
19.4
|
|
|
31.8
|
%
|
% sales
|
14.1
|
%
|
|
13.5
|
%
|
|
|
|
|
|
12.7
|
%
|
|
11.5
|
%
|
|
|
|
|
||||||||||
(1) Sales less cost of sales.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||||||||||||||||
(in millions, except per share)
|
2014
|
|
2013
|
|
Change
|
|
2014
|
|
2013
|
|
Change
|
||||||||||||||||||
Income from continuing operations
|
$
|
30.2
|
|
|
$
|
9.2
|
|
|
$
|
21.0
|
|
|
NM
|
|
|
$
|
53.0
|
|
|
$
|
24.6
|
|
|
$
|
28.4
|
|
|
NM
|
|
Income from discontinued operations, net of income taxes
|
—
|
|
|
200.1
|
|
|
(200.1
|
)
|
|
NM
|
|
|
—
|
|
|
198.2
|
|
|
$
|
(198.2
|
)
|
|
NM
|
|
|||||
Net income
|
$
|
30.2
|
|
|
$
|
209.3
|
|
|
$
|
(179.1
|
)
|
|
(85.6
|
)%
|
|
$
|
53.0
|
|
|
$
|
222.8
|
|
|
$
|
(169.8
|
)
|
|
(76.2
|
)%
|
Per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Income from continuing operations
|
$
|
0.55
|
|
|
$
|
0.18
|
|
|
$
|
0.37
|
|
|
NM
|
|
|
$
|
0.97
|
|
|
$
|
0.46
|
|
|
$
|
0.51
|
|
|
NM
|
|
Income from discontinued operations, net of income taxes
|
—
|
|
|
3.72
|
|
|
(3.72
|
)
|
|
NM
|
|
|
—
|
|
|
3.65
|
|
|
(3.65
|
)
|
|
NM
|
|
||||||
Net income
|
$
|
0.55
|
|
|
$
|
3.90
|
|
|
$
|
(3.35
|
)
|
|
(85.9
|
)%
|
|
$
|
0.97
|
|
|
$
|
4.11
|
|
|
$
|
(3.14
|
)
|
|
(76.4
|
)%
|
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Income from continuing operations
|
$
|
0.54
|
|
|
$
|
0.17
|
|
|
$
|
0.37
|
|
|
NM
|
|
|
$
|
0.95
|
|
|
$
|
0.45
|
|
|
$
|
0.5
|
|
|
NM
|
|
Income from discontinued operations, net of income taxes
|
—
|
|
|
3.65
|
|
|
(3.65
|
)
|
|
NM
|
|
|
—
|
|
|
3.59
|
|
|
(3.59
|
)
|
|
NM
|
|
||||||
Net income
|
$
|
0.54
|
|
|
$
|
3.82
|
|
|
$
|
(3.28
|
)
|
|
(85.9
|
)%
|
|
$
|
0.95
|
|
|
$
|
4.04
|
|
|
$
|
(3.09
|
)
|
|
(76.5
|
)%
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
54.7
|
|
|
53.7
|
|
|
1.0
|
|
|
1.9
|
%
|
|
54.7
|
|
|
54.2
|
|
|
0.5
|
|
|
0.9
|
%
|
||||||
Diluted
|
55.9
|
|
|
54.8
|
|
|
1.1
|
|
|
2.0
|
%
|
|
56.0
|
|
|
55.1
|
|
|
0.9
|
|
|
1.5
|
%
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||||||||||||||||
(in millions)
|
2014
|
|
2013
|
|
Change
|
|
2014
|
|
2013
|
|
Change
|
||||||||||||||||||
Sales
|
$
|
212.8
|
|
|
$
|
170.6
|
|
|
$
|
42.2
|
|
|
24.7
|
%
|
|
$
|
416.7
|
|
|
$
|
336.1
|
|
|
$
|
80.6
|
|
|
24.0
|
%
|
Operating profit
|
28.8
|
|
|
20.9
|
|
|
7.8
|
|
|
37.5
|
%
|
|
48.1
|
|
|
35.5
|
|
|
12.6
|
|
|
35.5
|
%
|
||||||
Operating margin
|
13.5
|
%
|
|
12.3
|
%
|
|
|
|
|
|
11.6
|
%
|
|
10.6
|
%
|
|
|
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||||||||||||||||
(in millions)
|
2014
|
|
2013
|
|
Change
|
|
2014
|
|
2013
|
|
Change
|
||||||||||||||||||
Sales
|
$
|
109.3
|
|
|
$
|
96.8
|
|
|
$
|
12.5
|
|
|
12.9
|
%
|
|
$
|
217.5
|
|
|
$
|
194.9
|
|
|
$
|
22.6
|
|
|
11.6
|
%
|
Operating profit
|
16.6
|
|
|
15.2
|
|
|
1.4
|
|
|
9.1
|
%
|
|
32.4
|
|
|
25.6
|
|
|
6.8
|
|
|
26.6
|
%
|
||||||
Operating margin
|
15.2
|
%
|
|
15.7
|
%
|
|
|
|
|
|
14.9
|
%
|
|
13.1
|
%
|
|
|
|
|
|
Six months ended June 30,
|
||||||||||
(in millions)
|
2014
|
|
2013
|
|
Change
|
||||||
Operating activities
|
$
|
64.9
|
|
|
$
|
65.5
|
|
|
$
|
(0.6
|
)
|
Investing activities
|
(68.4
|
)
|
|
519.0
|
|
|
(587.4
|
)
|
|||
Financing activities
|
(5.1
|
)
|
|
(471.3
|
)
|
|
466.2
|
|
|||
Exchange rate effect
|
(0.1
|
)
|
|
(2.2
|
)
|
|
2.1
|
|
|||
(Decrease)/increase in cash
|
$
|
(8.6
|
)
|
|
$
|
111.0
|
|
|
$
|
(119.7
|
)
|
|
Four fiscal quarters ended June 30, 2014
|
||
Net income
|
$
|
100.7
|
|
Add back:
|
|
||
Interest expense
|
11.6
|
|
|
Income taxes
|
28.2
|
|
|
Depreciation and amortization
|
76.5
|
|
|
Adjustment for non-cash stock based compensation
|
7.4
|
|
|
Amortization of Männer acquisition inventory step-up
|
7.2
|
|
|
Due diligence and transaction expenses
|
1.5
|
|
|
Adjustment for acquired businesses
|
12.4
|
|
|
Restructuring charges
|
3.4
|
|
|
Other adjustments
|
(0.9
|
)
|
|
Consolidated EBITDA, as defined
|
$
|
247.9
|
|
|
|
||
Consolidated Senior Debt, as defined, as of June 30, 2014
|
$
|
515.3
|
|
Ratio of Consolidated Senior Debt to Consolidated EBITDA
|
2.08
|
|
|
Maximum
|
3.50
|
|
|
Consolidated Total Debt, as defined, as of June 30, 2014
|
$
|
570.9
|
|
Ratio of Consolidated Total Debt to Consolidated EBITDA
|
2.30
|
|
|
Maximum
|
4.25
|
|
|
Consolidated Cash Interest Expense, as defined, as of June 30, 2014
|
$
|
10.7
|
|
Ratio of Consolidated EBITDA to Consolidated Cash Interest Expense
|
23.20
|
|
|
Minimum
|
4.25
|
|
|
Six months ended June 30,
|
||||||
|
2014
|
|
2013
|
||||
Net income
|
$
|
53.0
|
|
|
$
|
222.8
|
|
Add back:
|
|
|
|
||||
Interest expense
|
6.1
|
|
|
7.6
|
|
||
Income taxes
|
20.4
|
|
|
147.7
|
|
||
Depreciation and amortization
|
42.5
|
|
|
31.1
|
|
||
EBITDA
(1)
|
$
|
122.0
|
|
|
$
|
409.2
|
|
(1)
|
EBITDA of $409.2 million in 2013 includes a pre-tax gain of $313.5 million related to the sale of BDNA.
|
Period
|
|
(a)
Total Number of Shares (or Units) Purchased
|
|
(b)
Average Price Paid Per Share (or Unit)
|
|
(c)
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs
|
|
(d)
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
(1)
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
April 1-30, 2014
|
|
679
|
|
|
$
|
38.31
|
|
|
—
|
|
|
2,428,509
|
|
|
May 1-31, 2014
|
|
6,097
|
|
|
$
|
38.11
|
|
|
—
|
|
|
2,428,509
|
|
|
June 1-30, 2014
|
|
2,183
|
|
|
$
|
38.63
|
|
|
—
|
|
|
2,428,509
|
|
|
Total
|
|
8,959
|
|
(2)
|
$
|
38.25
|
|
|
—
|
|
|
|
|
(1)
|
The Program was publicly announced on October 20, 2011 (the "2011 Program") authorizing repurchase of up to 5.0 million shares of common stock. At December 31, 2012, 3.8 million shares of common stock had not been purchased under the 2011 Program. On February 21, 2013, the Board of Directors of the Company increased the number of shares authorized for repurchase under the 2011 Program by 1.2 million shares of common stock. The 2011 Program permits open market purchases, purchases under a Rule 10b5-1 trading plan and privately negotiated transactions.
|
(2)
|
All acquisitions of equity securities during the
second quarter of 2014
were the result of the operation of the terms of the Company's stockholder-approved equity compensation plans and the terms of the equity rights gran
ted pu
rsuant to
|
|
|
Barnes Group Inc.
|
|
|
(Registrant)
|
|
|
|
Date:
|
July 28, 2014
|
/s/ CHRISTOPHER J. STEPHENS, JR.
|
|
|
Christopher J. Stephens, Jr.
Senior Vice President, Finance
Chief Financial Officer
(Principal Financial Officer)
|
|
|
|
Date:
|
July 28, 2014
|
/s/ MARIAN ACKER
|
|
|
Marian Acker
Vice President, Controller
(Principal Accounting Officer)
|
Exhibit No.
|
|
Description
|
|
Reference
|
10.1
|
|
2014 Barnes Group Inc. Stock and Incentive Award Plan.
|
|
Incorporated by reference to Annex A to the Company’s definitive Proxy Statement filed with the Securities and Exchange Commission on March 25, 2014.
|
10.2
|
|
Form of Barnes Group Inc. Stock and Incentive Award Plan Restricted Stock Unit Summary of Grant and Restricted Stock Unit Agreement for Directors dated May 9, 2014 (for non-management directors).
|
|
Filed with this report.
|
10.3
|
|
Form of Barnes Group Inc. Stock and Incentive Award Plan Restricted Stock Unit Summary of Grant for Employees and Restricted Stock Unit Agreement dated May 9, 2014.
|
|
Filed with this report.
|
10.4
|
|
Form of Barnes Group Inc. Stock and Incentive Award Plan Stock Option Summary of Grant and Stock Option Agreement for Employees in Grade 21 and up dated May 9, 2014.
|
|
Filed with this report.
|
10.5
|
|
Form of Barnes Group Inc. Stock and Incentive Award Plan Performance Share Award Summary of Grant and Performance Share Award Agreement for Officers and Other Individuals as Designated by the Compensation and Management Development Committee dated July 21, 2014.
|
|
Filed with this report.
|
15
|
|
Letter regarding unaudited interim financial information.
|
|
Filed with this report.
|
31.1
|
|
Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Filed with this report.
|
31.2
|
|
Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Filed with this report.
|
32
|
|
Certification pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
Furnished with this report.
|
Exhibit 101.INS
|
|
XBRL Instance Document.
|
|
Filed with this report.
|
Exhibit 101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
Filed with this report.
|
Exhibit 101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
Filed with this report.
|
Exhibit 101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
Filed with this report.
|
Exhibit 101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
Filed with this report.
|
Exhibit 101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
Filed with this report.
|
Grantee:
|
[__________________________]
|
|
Grant Date:
|
FEBRUARY XX, 20XX
|
|
Number of Restricted Stock Units and Vesting Schedule:
|
[________] Restricted Stock Units. The Restricted Stock Units will vest 100% on the anniversary of the Grant Date, as follows:
|
|
|
No. of Restricted Stock Units
|
Vesting Date
|
|
|
FEBRUARY XX, 20XX
|
|
Except as provided otherwise in the Restricted Stock Unit Agreement, the Restricted Stock Units will vest in accordance with the foregoing vesting schedule if You remain in continued service with the Company through the applicable vesting date.
|
Grantee:
|
[__________________________]
|
||
|
|
||
Grant Date:
|
February XX, 20XX
|
||
|
|
||
Expiration Date:
|
[______] [__], [___]
|
||
|
|
||
Number of Shares and Vesting Schedule:
|
[________] Shares. The Shares will vest as to 1/3 on the 18-month, 30-month and 42-month anniversaries of the Grant Date, as follows:
|
||
|
|
|
|
|
No. of Shares
|
Vesting Date
|
|
|
|
August XX, 2015
|
|
|
August XX, 2016
|
||
|
August XX, 2017
|
||
|
|
|
|
|
Unless provided otherwise in the Stock Option Agreement, the Option will vest in accordance with the foregoing vesting schedule if You remain in continued employment with the Company through the applicable vesting date.
|
||
|
|
||
Purchase Price per Share:
|
$[______], which is 100% of the Fair Market Value of a Share on the Grant Date (the “Purchase Price”)
|
||
|
|
||
Type of Grant:
|
¨
Incentive Stock Option
¨
Non-Statutory Stock Option (also referred to as a Non- Qualified Stock Option)
|
||
|
|
Grantee:
|
[__________________________]
|
|
|
Grant Date:
|
February XX, 20XX
|
|
|
Target Award:
|
[______] Performance Shares
|
|
|
Performance Period:
|
The 3 year period beginning on January 1, 20XX and ending on December 31, 20XX
|
|
|
Performance Goals:
Vesting Schedule
|
The Performance Goals are based on the performance measures set forth on
Schedule A
.
The Performance Shares will be earned based on the performance level achieved with respect to the Performance Goals if, except as provided otherwise in the Performance Share Award Agreement, You continue employment with Company through the third anniversary of the Grant Date.
The number of Performance Shares set forth above is equal to the target number of shares of Common Stock that the Grantee will earn for 100% achievement of the Performance Goals (referred to as the “Target Award”). The actual number of shares of Common Stock that You will earn with respect to the Performance Shares may be greater or less than the Target Award, or even zero, and will be based on the performance level achieved by the Company with respect to the
|
|
Performance Goals, as set forth on
Schedule A
.
|
|
Performance level is measured based on the threshold, target and maximum performance levels set forth on
Schedule A
. Each performance level is calculated as a percentage of target level performance. Threshold performance level is 33% of target, target performance level is 100% of target, maximum performance level is 150% of target, maximum+ performance level is 200% of target and maximum++ performance level is 250% of target. If actual performance is between performance levels, the number of Performance Shares earned will be interpolated on a straight line basis for pro-rata achievement of the Performance Goals, rounded down to the nearest whole number. Failure to achieve the threshold performance level with respect to a Performance Goal will result in no Performance Shares being earned with respect to that Performance Goal.
|
Performance
Measure
|
Weight
|
Performance
Level
|
Performance Goals
|
Performance Shares Earned as a Percentage of Target
(% of Target)
*
|
3-Year TSR**
3-Year Diluted EPS Growth***
3-Year EBITDA Growth****
|
33.3334% each
|
Threshold
|
Achieve 33
rd
percentile ranking within the Russell 2000
|
33%
|
Target
|
Achieve 50
th
percentile ranking within the Russell 2000
|
100%
|
||
Maximum
|
Achieve 66
th
percentile ranking within the Russell 2000
|
150%
|
||
Maximum+
|
Achieve 75
th
percentile ranking within the Russell 2000
|
200%
|
||
Maximum++
|
Achieve 85
th
percentile ranking within the Russell 2000
|
250%
|
||
|
||||
* The actual number of Performance Shares that will be earned is based on the Company’s percentile ranking within the Russell 2000 Index at the end of the Performance Period. Actual performance level achievement between each performance level will be interpolated on a straight line basis rounded down to the nearest whole number; provided that if the actual performance level achieved does not meet threshold performance (i.e., less than 33%) for the applicable performance measure, then no Performance Shares will be earned for that performance measure pursuant to this Grant. Threshold level performance may be achieved for one performance measure and not another based on the Company’s actual performance during the Performance Period. The actual number of Performance Shares earned will be determined by the Committee based on the actual performance level achieved with respect to each of the applicable Performance Goals, factoring in the weighting for each performance measure. The maximum number of Performance Shares that may be earned pursuant to this Grant is capped at 250% of the Target Award.
** 3-Year TSR represents the comparison between the Opening Average Share Value and the Closing Average Share Value, plus cumulative dividends during the Performance Period. At the end of the Performance Period, the TSR for the Company and each company in the Russell 2000 Index will be calculated by dividing the Closing Average Share Value by the Opening Share Value. For purposes of this Grant, the term “Closing Average Share Value” means the average closing value of the common stock, for the 20 trading days ending on the last day of the Performance Period (i.e., the 20 trading days ending on December 31, 20XX) (the “20-day period”), which will be calculated as follows: (i) determine the closing price of the common stock on each trading date during the 20-day period, (ii) average the amounts so determined for the 20-day period; the term “Opening Average Share Value” means the average of the closing price of a share of common stock for the 20 trading days preceding the start of the Performance Period (i.e., January 1, 20XX).
*** 3-Year Diluted EPS Growth represents earnings per share including the impact of conversion of convertible preferred, convertible debentures, and options and warrants which have been identified as common stock equivalents and before extraordinary items. Growth will be computed as Diluted EPS in Year 3 divided by Diluted EPS in the year preceding this award (i.e. 20XX). The 3-Year Diluted EPS Growth calculation is subject to the adjustments as set forth below.
|
****3-Year EBITDA Growth represents Operating Income Before Depreciation and Amortization. EBITDA will be computed as EBITDA in Year 3 divided by EBITDA in the year preceding this award (i.e. 20XX). The 3-Year EBITDA Growth calculation is subject to the adjustments as set forth below.
3-Year Diluted EPS Growth and 3-Year EBITDA Growth may include or exclude (or be adjusted to include or exclude) extraordinary items, the impact of charges for restructurings or productivity initiatives, non-operating items, discontinued operations and other unusual and non-recurring items, the effects of currency fluctuations, the effects of financing activities (by way of example, without limitation, the effect on earnings per share of issuing convertible debt securities), the effects of acquisitions and acquisition expenses, the effects of divesture and divesture expenses, and the effects of tax or accounting changes. However, notwithstanding the preceding sentence, unless the Committee determines otherwise either at the time it establishes the Performance Goals for an award or prior to the payment of an award, if any of the items referenced in the preceding sentence occurs, then such item shall be automatically excluded or included in determining the extent to which the Performance Goal has been achieved, whichever will produce the higher award (subject to any exercise of “negative discretion” by the Committee).
|
/s/ PricewaterhouseCoopers LLP
|
|
PricewaterhouseCoopers LLP
Hartford, Connecticut
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q for the period ended
June 30, 2014
of Barnes Group 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.
|
|
/s/ PATRICK J. DEMPSEY
|
|
Patrick J. Dempsey
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q for the period ended
June 30, 2014
of Barnes Group 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.
|
|
/s/ CHRISTOPHER J. STEPHENS, JR.
|
|
Christopher J. Stephens, Jr.
|
|
Chief Financial Officer
|
/s/ PATRICK J. DEMPSEY
|
|
/s/ CHRISTOPHER J. STEPHENS, JR.
|
Patrick J. Dempsey
President and Chief Executive Officer
|
|
Christopher J. Stephens, Jr.
Chief Financial Officer
|
July 28, 2014
|
|
July 28, 2014
|