New York State
|
16-0757636
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
East Aurora, New York
|
14052-0018
|
(Address of principal executive offices)
|
(Zip Code)
|
(716) 652-2000
|
|
(Telephone number including area code)
|
|
||||||
|
|
|
|
|
||
|
|
PAGE
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
(dollars in thousands, except share and per share data)
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Net sales
|
|
$
|
692,018
|
|
|
$
|
626,183
|
|
|
$
|
2,008,602
|
|
|
$
|
1,848,256
|
|
Cost of sales
|
|
492,234
|
|
|
443,769
|
|
|
1,424,731
|
|
|
1,308,256
|
|
||||
Inventory write-down - restructuring
|
|
2,398
|
|
|
—
|
|
|
9,727
|
|
|
—
|
|
||||
Gross profit
|
|
197,386
|
|
|
182,414
|
|
|
574,144
|
|
|
540,000
|
|
||||
Research and development
|
|
31,040
|
|
|
36,314
|
|
|
97,545
|
|
|
107,828
|
|
||||
Selling, general and administrative
|
|
103,053
|
|
|
89,144
|
|
|
299,002
|
|
|
261,271
|
|
||||
Interest
|
|
8,850
|
|
|
8,654
|
|
|
26,585
|
|
|
25,789
|
|
||||
Restructuring
|
|
(1,549
|
)
|
|
—
|
|
|
22,509
|
|
|
—
|
|
||||
Other
|
|
1,037
|
|
|
29
|
|
|
45
|
|
|
12,148
|
|
||||
Earnings before income taxes
|
|
54,955
|
|
|
48,273
|
|
|
128,458
|
|
|
132,964
|
|
||||
Income taxes
|
|
14,205
|
|
|
8,185
|
|
|
72,444
|
|
|
31,156
|
|
||||
Net earnings attributable to Moog and noncontrolling interest
|
|
40,750
|
|
|
40,088
|
|
|
56,014
|
|
|
101,808
|
|
||||
Net earnings (loss) attributable to noncontrolling interest
|
|
67
|
|
|
—
|
|
|
67
|
|
|
(870
|
)
|
||||
Net earnings attributable to Moog
|
|
$
|
40,683
|
|
|
$
|
40,088
|
|
|
$
|
55,947
|
|
|
$
|
102,678
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net earnings per share attributable to Moog
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
1.14
|
|
|
$
|
1.12
|
|
|
$
|
1.56
|
|
|
$
|
2.86
|
|
Diluted
|
|
$
|
1.13
|
|
|
$
|
1.11
|
|
|
$
|
1.55
|
|
|
$
|
2.83
|
|
|
|
|
|
|
|
|
|
|
||||||||
Dividends declared per share
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.25
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Average common shares outstanding
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
35,762,918
|
|
|
35,847,842
|
|
|
35,768,471
|
|
|
35,868,315
|
|
||||
Diluted
|
|
36,143,367
|
|
|
36,212,779
|
|
|
36,174,759
|
|
|
36,240,794
|
|
||||
See accompanying Notes to Consolidated Condensed Financial Statements.
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
(dollars in thousands)
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Net earnings attributable to Moog and noncontrolling interest
|
|
$
|
40,750
|
|
|
$
|
40,088
|
|
|
$
|
56,014
|
|
|
$
|
101,808
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustment
|
|
(40,788
|
)
|
|
32,805
|
|
|
(10,127
|
)
|
|
3,991
|
|
||||
Retirement liability adjustment
|
|
7,080
|
|
|
3,566
|
|
|
16,018
|
|
|
17,609
|
|
||||
Change in accumulated income (loss) on derivatives
|
|
(747
|
)
|
|
1,013
|
|
|
(92
|
)
|
|
2,833
|
|
||||
Other comprehensive income (loss), net of tax
|
|
(34,455
|
)
|
|
37,384
|
|
|
5,799
|
|
|
24,433
|
|
||||
Tax Cuts and Jobs Act, reclassification from AOCIL to retained earnings
|
|
—
|
|
|
—
|
|
|
(47,077
|
)
|
|
—
|
|
||||
Comprehensive income (loss)
|
|
6,295
|
|
|
77,472
|
|
|
14,736
|
|
|
126,241
|
|
||||
Comprehensive income (loss) attributable to noncontrolling interest
|
|
41
|
|
|
—
|
|
|
41
|
|
|
(870
|
)
|
||||
Comprehensive income (loss) attributable to Moog
|
|
$
|
6,254
|
|
|
$
|
77,472
|
|
|
$
|
14,695
|
|
|
$
|
127,111
|
|
See accompanying Notes to Consolidated Condensed Financial Statements.
|
(dollars in thousands)
|
|
June 30,
2018 |
|
September 30,
2017 |
||||
ASSETS
|
|
|
|
|
||||
Current assets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
157,269
|
|
|
$
|
368,073
|
|
Receivables
|
|
757,455
|
|
|
727,740
|
|
||
Inventories
|
|
514,578
|
|
|
489,127
|
|
||
Prepaid expenses and other current assets
|
|
50,215
|
|
|
41,499
|
|
||
Total current assets
|
|
1,479,517
|
|
|
1,626,439
|
|
||
Property, plant and equipment, net of accumulated depreciation of $818,644 and $771,160, respectively
|
|
546,598
|
|
|
522,991
|
|
||
Goodwill
|
|
790,826
|
|
|
774,268
|
|
||
Intangible assets, net
|
|
112,838
|
|
|
108,818
|
|
||
Deferred income taxes
|
|
13,214
|
|
|
26,558
|
|
||
Other assets
|
|
35,860
|
|
|
31,518
|
|
||
Total assets
|
|
$
|
2,978,853
|
|
|
$
|
3,090,592
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
||||
Current liabilities
|
|
|
|
|
||||
Short-term borrowings
|
|
$
|
1,416
|
|
|
$
|
89
|
|
Current installments of long-term debt
|
|
393
|
|
|
295
|
|
||
Accounts payable
|
|
190,092
|
|
|
170,878
|
|
||
Accrued compensation
|
|
144,712
|
|
|
148,406
|
|
||
Customer advances
|
|
163,318
|
|
|
159,274
|
|
||
Contract loss reserves
|
|
41,143
|
|
|
43,214
|
|
||
Other accrued liabilities
|
|
113,956
|
|
|
107,278
|
|
||
Total current liabilities
|
|
655,030
|
|
|
629,434
|
|
||
Long-term debt, excluding current installments
|
|
858,425
|
|
|
956,653
|
|
||
Long-term pension and retirement obligations
|
|
118,862
|
|
|
271,272
|
|
||
Deferred income taxes
|
|
47,722
|
|
|
13,320
|
|
||
Other long-term liabilities
|
|
36,021
|
|
|
5,609
|
|
||
Total liabilities
|
|
1,716,060
|
|
|
1,876,288
|
|
||
Commitments and contingencies (Note 18)
|
|
—
|
|
|
—
|
|
||
Shareholders’ equity
|
|
|
|
|
||||
Common stock - Class A
|
|
43,780
|
|
|
43,704
|
|
||
Common stock - Class B
|
|
7,500
|
|
|
7,576
|
|
||
Additional paid-in capital
|
|
486,510
|
|
|
492,246
|
|
||
Retained earnings
|
|
1,941,902
|
|
|
1,847,819
|
|
||
Treasury shares
|
|
(739,042
|
)
|
|
(739,157
|
)
|
||
Stock Employee Compensation Trust
|
|
(89,904
|
)
|
|
(89,919
|
)
|
||
Supplemental Retirement Plan Trust
|
|
(11,736
|
)
|
|
(12,474
|
)
|
||
Accumulated other comprehensive loss
|
|
(376,743
|
)
|
|
(335,491
|
)
|
||
Total Moog shareholders’ equity
|
|
1,262,267
|
|
|
1,214,304
|
|
||
Noncontrolling interest
|
|
526
|
|
|
—
|
|
||
Total shareholders’ equity
|
|
1,262,793
|
|
|
1,214,304
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
2,978,853
|
|
|
$
|
3,090,592
|
|
See accompanying Notes to Consolidated Condensed Financial Statements.
|
|
|
|
|
|
|
|
|
Number of Shares
|
||||||
(dollars in thousands, except share data)
|
|
Amount
|
|
Class A Common Stock
|
|
Class B Common Stock
|
||||
COMMON STOCK
|
|
|
|
|
|
|
||||
Beginning of period
|
|
$
|
51,280
|
|
|
43,704,286
|
|
|
7,575,427
|
|
Conversion of Class B to Class A
|
|
—
|
|
|
75,951
|
|
|
(75,951
|
)
|
|
End of period
|
|
51,280
|
|
|
43,780,237
|
|
|
7,499,476
|
|
|
ADDITIONAL PAID-IN CAPITAL
|
|
|
|
|
|
|
||||
Beginning of period
|
|
492,246
|
|
|
|
|
|
|||
Issuance of treasury shares
|
|
(2,874
|
)
|
|
|
|
|
|||
Equity-based compensation expense
|
|
4,394
|
|
|
|
|
|
|||
Adjustment to market - SECT, SERP and other
|
|
(7,256
|
)
|
|
|
|
|
|||
End of period
|
|
486,510
|
|
|
|
|
|
|||
RETAINED EARNINGS
|
|
|
|
|
|
|
||||
Beginning of period
|
|
1,847,819
|
|
|
|
|
|
|||
Net earnings attributable to Moog
|
|
55,947
|
|
|
|
|
|
|||
Dividends
|
|
(8,941
|
)
|
|
|
|
|
|||
Tax Cuts and Jobs Act, reclassification from AOCIL to retained earnings
|
|
47,077
|
|
|
|
|
|
|||
End of period
|
|
1,941,902
|
|
|
|
|
|
|||
TREASURY SHARES AT COST
|
|
|
|
|
|
|
||||
Beginning of period
|
|
(739,157
|
)
|
|
(10,933,003
|
)
|
|
(3,333,927
|
)
|
|
Class A and B shares issued related to equity compensation
|
|
5,325
|
|
|
83,193
|
|
|
28,460
|
|
|
Class A and B shares purchased
|
|
(5,210
|
)
|
|
(38,590
|
)
|
|
(22,469
|
)
|
|
End of period
|
|
(739,042
|
)
|
|
(10,888,400
|
)
|
|
(3,327,936
|
)
|
|
STOCK EMPLOYEE COMPENSATION TRUST (SECT)
|
|
|
|
|
|
|
||||
Beginning of period
|
|
(89,919
|
)
|
|
(425,148
|
)
|
|
(654,753
|
)
|
|
Issuance of shares
|
|
1,941
|
|
|
—
|
|
|
21,871
|
|
|
Purchase of shares
|
|
(8,444
|
)
|
|
—
|
|
|
(97,855
|
)
|
|
Adjustment to market
|
|
6,518
|
|
|
—
|
|
|
—
|
|
|
End of period
|
|
(89,904
|
)
|
|
(425,148
|
)
|
|
(730,737
|
)
|
|
SUPPLEMENTAL RETIREMENT PLAN (SERP) TRUST
|
|
|
|
|
|
|
||||
Beginning of period
|
|
(12,474
|
)
|
|
|
|
(150,000
|
)
|
||
Adjustment to market
|
|
738
|
|
|
|
|
—
|
|
||
End of period
|
|
(11,736
|
)
|
|
|
|
(150,000
|
)
|
||
ACCUMULATED OTHER COMPREHENSIVE LOSS
|
|
|
|
|
|
|
||||
Beginning of period
|
|
(335,491
|
)
|
|
|
|
|
|||
Other comprehensive income (loss)
|
|
5,825
|
|
|
|
|
|
|||
Tax Cuts and Jobs Act, reclassification from AOCIL to retained earnings
|
|
(47,077
|
)
|
|
|
|
|
|||
End of period
|
|
(376,743
|
)
|
|
|
|
|
|||
TOTAL MOOG SHAREHOLDERS’ EQUITY
|
|
1,262,267
|
|
|
32,466,689
|
|
|
3,290,803
|
|
|
NONCONTROLLING INTEREST
|
|
|
|
|
|
|
||||
Beginning of period
|
|
—
|
|
|
|
|
|
|||
Acquisition of noncontrolling interest
|
|
485
|
|
|
|
|
|
|||
Net earnings attributable to noncontrolling interest
|
|
67
|
|
|
|
|
|
|||
Foreign currency translation adjustment
|
|
(26
|
)
|
|
|
|
|
|||
End of period
|
|
526
|
|
|
|
|
|
|||
TOTAL SHAREHOLDERS’ EQUITY
|
|
$
|
1,262,793
|
|
|
|
|
|
|
||||||||
|
|
Nine Months Ended
|
||||||
(dollars in thousands)
|
|
June 30,
2018 |
|
July 1,
2017 |
||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
||||
Net earnings attributable to Moog and noncontrolling interest
|
|
$
|
56,014
|
|
|
$
|
101,808
|
|
Adjustments to reconcile net earnings to net cash provided (used) by operating activities:
|
|
|
|
|
||||
Depreciation
|
|
54,693
|
|
|
53,027
|
|
||
Amortization
|
|
13,628
|
|
|
14,078
|
|
||
Deferred income taxes
|
|
35,549
|
|
|
2,968
|
|
||
Equity-based compensation expense
|
|
4,394
|
|
|
4,151
|
|
||
Impairment of long-lived assets and inventory write-down associated with restructuring
|
|
24,246
|
|
|
—
|
|
||
Other
|
|
4,743
|
|
|
15,493
|
|
||
Changes in assets and liabilities providing (using) cash:
|
|
|
|
|
||||
Receivables
|
|
(27,597
|
)
|
|
176
|
|
||
Inventories
|
|
(27,840
|
)
|
|
3,786
|
|
||
Accounts payable
|
|
12,778
|
|
|
11,312
|
|
||
Customer advances
|
|
(165
|
)
|
|
(3,097
|
)
|
||
Accrued expenses
|
|
11,709
|
|
|
(180
|
)
|
||
Accrued income taxes
|
|
(1,817
|
)
|
|
(2,767
|
)
|
||
Net pension and post retirement liabilities
|
|
(130,135
|
)
|
|
(25,982
|
)
|
||
Other assets and liabilities
|
|
16,150
|
|
|
(5,449
|
)
|
||
Net cash provided by operating activities
|
|
46,350
|
|
|
169,324
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
||||
Acquisitions of businesses, net of cash acquired
|
|
(47,947
|
)
|
|
(40,545
|
)
|
||
Purchase of property, plant and equipment
|
|
(70,759
|
)
|
|
(45,349
|
)
|
||
Other investing transactions
|
|
(3,609
|
)
|
|
3,031
|
|
||
Net cash (used) by investing activities
|
|
(122,315
|
)
|
|
(82,863
|
)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
||||
Net short-term borrowings (repayments)
|
|
1,357
|
|
|
(1,280
|
)
|
||
Proceeds from revolving lines of credit
|
|
301,500
|
|
|
185,045
|
|
||
Payments on revolving lines of credit
|
|
(411,610
|
)
|
|
(235,045
|
)
|
||
Proceeds from long-term debt
|
|
11,216
|
|
|
—
|
|
||
Payments on long-term debt
|
|
(21,849
|
)
|
|
(133
|
)
|
||
Payment of dividends
|
|
(8,941
|
)
|
|
—
|
|
||
Proceeds from sale of treasury stock
|
|
2,451
|
|
|
2,135
|
|
||
Purchase of outstanding shares for treasury
|
|
(5,210
|
)
|
|
(5,714
|
)
|
||
Proceeds from sale of stock held by SECT
|
|
1,941
|
|
|
867
|
|
||
Purchase of stock held by SECT
|
|
(8,444
|
)
|
|
(12,162
|
)
|
||
Other financing transactions
|
|
484
|
|
|
(1,656
|
)
|
||
Net cash (used) by financing activities
|
|
(137,105
|
)
|
|
(67,943
|
)
|
||
Effect of exchange rate changes on cash
|
|
2,266
|
|
|
895
|
|
||
Increase (decrease) in cash and cash equivalents
|
|
(210,804
|
)
|
|
19,413
|
|
||
Cash and cash equivalents at beginning of period
|
|
368,073
|
|
|
325,128
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
157,269
|
|
|
$
|
344,541
|
|
See accompanying Notes to Consolidated Condensed Financial Statements.
|
Standard
|
|
Description
|
|
Financial Statement Effect or Other Significant Matters
|
ASU no. 2018-02
Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income
|
|
The standard amends existing guidance and allows a reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded deferred tax effects resulting from the Tax Cuts and Jobs Act. The standard requires certain disclosures about stranded deferred tax effects. The provisions of the standard are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted.
|
|
We adopted this standard recording the related stranded deferred tax effects in the period of adoption, resulting in $47,077 being reclassified from accumulated other comprehensive income (loss) to retained earnings as of March 31, 2018.
|
Date early adopted:
Q2 2018
|
|
|
|
|
|
Standard
|
|
Description
|
|
Financial Statement Effect or Other Significant Matters
|
ASU no. 2017-12
Targeted Improvements to Accounting for Hedging Activities
|
|
The standard expands the hedging strategies eligible for hedge accounting, while simplifying presentation and disclosure by eliminating separate measurement and reporting of hedge ineffectiveness. The provisions of the standard are effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption is permitted.
|
|
We are currently evaluating the effect on our financial statements and related disclosures.
|
Planned date of adoption:
Q1 2020
|
|
|
June 30,
2018 |
|
September 30,
2017 |
||||
Accounts receivable
|
|
$
|
293,967
|
|
|
$
|
286,773
|
|
Long-term contract receivables:
|
|
|
|
|
||||
Amounts billed
|
|
138,862
|
|
|
148,087
|
|
||
Unbilled recoverable costs and accrued profits
|
|
297,527
|
|
|
282,154
|
|
||
Total long-term contract receivables
|
|
436,389
|
|
|
430,241
|
|
||
Other
|
|
31,987
|
|
|
15,077
|
|
||
Total receivables
|
|
762,343
|
|
|
732,091
|
|
||
Less allowance for doubtful accounts
|
|
(4,888
|
)
|
|
(4,351
|
)
|
||
Receivables
|
|
$
|
757,455
|
|
|
$
|
727,740
|
|
|
|
June 30,
2018 |
|
September 30,
2017 |
||||
Raw materials and purchased parts
|
|
$
|
187,483
|
|
|
$
|
189,517
|
|
Work in progress
|
|
251,865
|
|
|
229,202
|
|
||
Finished goods
|
|
75,230
|
|
|
70,408
|
|
||
Inventories
|
|
$
|
514,578
|
|
|
$
|
489,127
|
|
|
Aircraft
Controls |
Space and
Defense Controls |
Industrial
Systems |
Total
|
||||||||
Balance at September 30, 2017
|
$
|
181,375
|
|
$
|
259,951
|
|
$
|
332,942
|
|
$
|
774,268
|
|
Acquisitions
|
—
|
|
3,769
|
|
17,541
|
|
21,310
|
|
||||
Foreign currency translation
|
(780
|
)
|
(96
|
)
|
(3,876
|
)
|
(4,752
|
)
|
||||
Balance at June 30, 2018
|
$
|
180,595
|
|
$
|
263,624
|
|
$
|
346,607
|
|
$
|
790,826
|
|
|
|
|
|
June 30, 2018
|
|
September 30, 2017
|
||||||||||||
|
|
Weighted-
Average Life (years) |
|
Gross Carrying
Amount |
|
Accumulated
Amortization |
|
Gross Carrying
Amount |
|
Accumulated
Amortization |
||||||||
Customer-related
|
|
11
|
|
$
|
148,558
|
|
|
$
|
(97,083
|
)
|
|
$
|
175,872
|
|
|
$
|
(128,019
|
)
|
Technology-related
|
|
10
|
|
72,722
|
|
|
(50,766
|
)
|
|
71,924
|
|
|
(55,069
|
)
|
||||
Program-related
|
|
19
|
|
65,676
|
|
|
(33,168
|
)
|
|
66,458
|
|
|
(30,675
|
)
|
||||
Marketing-related
|
|
8
|
|
24,945
|
|
|
(18,842
|
)
|
|
26,552
|
|
|
(19,251
|
)
|
||||
Other
|
|
10
|
|
4,333
|
|
|
(3,537
|
)
|
|
4,379
|
|
|
(3,353
|
)
|
||||
Intangible assets
|
|
12
|
|
$
|
316,234
|
|
|
$
|
(203,396
|
)
|
|
$
|
345,185
|
|
|
$
|
(236,367
|
)
|
|
|
June 30,
2018 |
|
September 30,
2017 |
||||
U.S. revolving credit facility
|
|
$
|
430,000
|
|
|
$
|
540,110
|
|
Senior notes
|
|
300,000
|
|
|
300,000
|
|
||
Securitization program
|
|
130,000
|
|
|
120,000
|
|
||
Obligations under capital leases
|
|
962
|
|
|
306
|
|
||
Senior debt
|
|
860,962
|
|
|
960,416
|
|
||
Less deferred debt issuance cost
|
|
(2,144
|
)
|
|
(3,468
|
)
|
||
Less current installments
|
|
(393
|
)
|
|
(295
|
)
|
||
Long-term debt
|
|
$
|
858,425
|
|
|
$
|
956,653
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Warranty accrual at beginning of period
|
|
$
|
28,255
|
|
|
$
|
23,272
|
|
|
$
|
25,848
|
|
|
$
|
21,363
|
|
Additions from acquisitions
|
|
—
|
|
|
433
|
|
|
—
|
|
|
433
|
|
||||
Warranties issued during current period
|
|
3,451
|
|
|
4,030
|
|
|
11,488
|
|
|
12,185
|
|
||||
Adjustments to pre-existing warranties
|
|
(80
|
)
|
|
(124
|
)
|
|
(325
|
)
|
|
(495
|
)
|
||||
Reductions for settling warranties
|
|
(3,219
|
)
|
|
(4,046
|
)
|
|
(9,141
|
)
|
|
(9,509
|
)
|
||||
Foreign currency translation
|
|
(701
|
)
|
|
420
|
|
|
(164
|
)
|
|
8
|
|
||||
Warranty accrual at end of period
|
|
$
|
27,706
|
|
|
$
|
23,985
|
|
|
$
|
27,706
|
|
|
$
|
23,985
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||||
Net gain (loss)
|
|
$
|
(1,028
|
)
|
|
$
|
(1,440
|
)
|
|
$
|
(4,037
|
)
|
|
$
|
(539
|
)
|
|
|
Classification
|
|
June 30,
2018 |
|
September 30,
2017 |
||||
Foreign currency contracts
|
|
Other current assets
|
|
$
|
831
|
|
|
$
|
646
|
|
Foreign currency contracts
|
|
Other assets
|
|
28
|
|
|
50
|
|
||
Interest rate swaps
|
|
Other current assets
|
|
1,543
|
|
|
552
|
|
||
Interest rate swaps
|
|
Other assets
|
|
439
|
|
|
314
|
|
||
|
|
Total assets
|
|
$
|
2,841
|
|
|
$
|
1,562
|
|
Foreign currency contracts
|
|
Other accrued liabilities
|
|
$
|
2,471
|
|
|
$
|
1,817
|
|
Foreign currency contracts
|
|
Other long-term liabilities
|
|
508
|
|
|
244
|
|
||
Interest rate swaps
|
|
Other accrued liabilities
|
|
—
|
|
|
10
|
|
||
Interest rate swaps
|
|
Other long-term liabilities
|
|
—
|
|
|
15
|
|
||
Net investment hedge
|
|
Other accrued liabilities
|
|
5
|
|
|
—
|
|
||
|
|
Total liabilities
|
|
$
|
2,984
|
|
|
$
|
2,086
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
U.S. Plans
|
|
|
|
|
|
|
|
|
||||||||
Service cost
|
|
$
|
5,634
|
|
|
$
|
6,044
|
|
|
$
|
16,901
|
|
|
$
|
18,087
|
|
Interest cost
|
|
8,073
|
|
|
7,659
|
|
|
24,219
|
|
|
22,930
|
|
||||
Expected return on plan assets
|
|
(13,575
|
)
|
|
(13,627
|
)
|
|
(40,726
|
)
|
|
(40,882
|
)
|
||||
Amortization of prior service cost (credit)
|
|
46
|
|
|
46
|
|
|
140
|
|
|
140
|
|
||||
Amortization of actuarial loss
|
|
6,903
|
|
|
8,465
|
|
|
20,707
|
|
|
25,303
|
|
||||
Pension expense for U.S. defined benefit plans
|
|
$
|
7,081
|
|
|
$
|
8,587
|
|
|
$
|
21,241
|
|
|
$
|
25,578
|
|
Non-U.S. Plans
|
|
|
|
|
|
|
|
|
||||||||
Service cost
|
|
$
|
1,486
|
|
|
$
|
1,499
|
|
|
$
|
4,475
|
|
|
$
|
4,545
|
|
Interest cost
|
|
1,066
|
|
|
794
|
|
|
3,213
|
|
|
2,291
|
|
||||
Expected return on plan assets
|
|
(1,260
|
)
|
|
(1,180
|
)
|
|
(3,793
|
)
|
|
(3,433
|
)
|
||||
Amortization of prior service cost (credit)
|
|
(15
|
)
|
|
(26
|
)
|
|
(44
|
)
|
|
(80
|
)
|
||||
Amortization of actuarial loss
|
|
630
|
|
|
1,145
|
|
|
1,902
|
|
|
3,374
|
|
||||
Curtailment gain
|
|
—
|
|
|
(150
|
)
|
|
—
|
|
|
(150
|
)
|
||||
Pension expense for non-U.S. defined benefit plans
|
|
$
|
1,907
|
|
|
$
|
2,082
|
|
|
$
|
5,753
|
|
|
$
|
6,547
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
U.S. defined contribution plans
|
|
$
|
4,374
|
|
|
$
|
3,926
|
|
|
$
|
12,482
|
|
|
$
|
11,182
|
|
Non-U.S. defined contribution plans
|
|
1,460
|
|
|
1,534
|
|
|
4,719
|
|
|
4,366
|
|
||||
Total pension expense for defined contribution plans
|
|
$
|
5,834
|
|
|
$
|
5,460
|
|
|
$
|
17,201
|
|
|
$
|
15,548
|
|
|
Aircraft Controls
|
Industrial Systems
|
Corporate
|
Total
|
||||||||
Balance at September 30, 2017
|
$
|
130
|
|
$
|
—
|
|
$
|
1,038
|
|
$
|
1,168
|
|
Charged to expense - 2018 plan
|
—
|
|
32,236
|
|
—
|
|
32,236
|
|
||||
Non-cash charges - 2018 plan
|
—
|
|
(24,246
|
)
|
—
|
|
(24,246
|
)
|
||||
Cash payments - 2018 plan
|
—
|
|
(354
|
)
|
—
|
|
(354
|
)
|
||||
Cash payments - 2016 plan
|
(130
|
)
|
—
|
|
(446
|
)
|
(576
|
)
|
||||
Foreign currency translation
|
—
|
|
(206
|
)
|
—
|
|
(206
|
)
|
||||
Balance at June 30, 2018
|
$
|
—
|
|
$
|
7,430
|
|
$
|
592
|
|
$
|
8,022
|
|
|
|
Accumulated foreign currency translation
(1)
|
|
Accumulated retirement liability
|
|
Accumulated gain (loss) on derivatives
|
|
Total
|
||||||||
AOCIL at September 30, 2017
|
|
$
|
(83,166
|
)
|
|
$
|
(251,865
|
)
|
|
$
|
(460
|
)
|
|
$
|
(335,491
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
(10,101
|
)
|
|
330
|
|
|
(640
|
)
|
|
(10,411
|
)
|
||||
Amounts reclassified from AOCIL
|
|
—
|
|
|
15,688
|
|
|
548
|
|
|
16,236
|
|
||||
Other comprehensive income (loss)
|
|
(10,101
|
)
|
|
16,018
|
|
|
(92
|
)
|
|
5,825
|
|
||||
Tax Cuts and Jobs Act, reclassification from AOCIL to retained earnings
(2)
|
|
—
|
|
|
(47,209
|
)
|
|
132
|
|
|
(47,077
|
)
|
||||
AOCIL at June 30, 2018
|
|
$
|
(93,267
|
)
|
|
$
|
(283,056
|
)
|
|
$
|
(420
|
)
|
|
$
|
(376,743
|
)
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
Statement of earnings classification
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Retirement liability:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Prior service cost (credit)
|
|
|
|
$
|
(86
|
)
|
|
$
|
22
|
|
|
$
|
(257
|
)
|
|
$
|
61
|
|
Actuarial losses
|
|
|
|
7,405
|
|
|
9,488
|
|
|
22,224
|
|
|
28,311
|
|
||||
Reclassification from AOCIL into earnings
(1)
|
|
7,319
|
|
|
9,360
|
|
|
21,967
|
|
|
28,222
|
|
||||||
Tax effect
|
|
|
|
(1,791
|
)
|
|
(3,450
|
)
|
|
(6,279
|
)
|
|
(10,301
|
)
|
||||
Net reclassification from AOCIL into earnings
|
|
$
|
5,528
|
|
|
$
|
5,910
|
|
|
$
|
15,688
|
|
|
$
|
17,921
|
|
||
Derivatives:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
|
|
Sales
|
|
$
|
(122
|
)
|
|
$
|
801
|
|
|
$
|
(378
|
)
|
|
$
|
3,255
|
|
Foreign currency contracts
|
|
Cost of sales
|
|
428
|
|
|
582
|
|
|
1,626
|
|
|
1,713
|
|
||||
Interest rate swaps
|
|
Interest
|
|
(259
|
)
|
|
20
|
|
|
(375
|
)
|
|
198
|
|
||||
Reclassification from AOCIL into earnings
|
|
47
|
|
|
1,403
|
|
|
873
|
|
|
5,166
|
|
||||||
Tax effect
|
|
|
|
(18
|
)
|
|
(384
|
)
|
|
(325
|
)
|
|
(1,357
|
)
|
||||
Net reclassification from AOCIL into earnings
|
|
$
|
29
|
|
|
$
|
1,019
|
|
|
$
|
548
|
|
|
$
|
3,809
|
|
|
|
Net deferral in AOCIL - effective portion
|
||||||||||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Foreign currency contracts
|
|
$
|
(1,246
|
)
|
|
$
|
68
|
|
|
$
|
(2,073
|
)
|
|
$
|
(2,041
|
)
|
Interest rate swaps
|
|
223
|
|
|
(151
|
)
|
|
1,470
|
|
|
612
|
|
||||
Net gain (loss)
|
|
(1,023
|
)
|
|
(83
|
)
|
|
(603
|
)
|
|
(1,429
|
)
|
||||
Tax effect
|
|
247
|
|
|
77
|
|
|
(37
|
)
|
|
453
|
|
||||
Net deferral in AOCIL of derivatives
|
|
$
|
(776
|
)
|
|
$
|
(6
|
)
|
|
$
|
(640
|
)
|
|
$
|
(976
|
)
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||
Basic weighted-average shares outstanding
|
|
35,762,918
|
|
|
35,847,842
|
|
|
35,768,471
|
|
|
35,868,315
|
|
Dilutive effect of equity-based awards
|
|
380,449
|
|
|
364,937
|
|
|
406,288
|
|
|
372,479
|
|
Diluted weighted-average shares outstanding
|
|
36,143,367
|
|
|
36,212,779
|
|
|
36,174,759
|
|
|
36,240,794
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Net sales:
|
|
|
|
|
|
|
|
|
||||||||
Aircraft Controls
|
|
$
|
299,605
|
|
|
$
|
282,555
|
|
|
$
|
889,578
|
|
|
$
|
840,666
|
|
Space and Defense Controls
|
|
149,815
|
|
|
128,049
|
|
|
426,735
|
|
|
389,473
|
|
||||
Industrial Systems
|
|
242,598
|
|
|
215,579
|
|
|
692,289
|
|
|
618,117
|
|
||||
Net sales
|
|
$
|
692,018
|
|
|
$
|
626,183
|
|
|
$
|
2,008,602
|
|
|
$
|
1,848,256
|
|
Operating profit:
|
|
|
|
|
|
|
|
|
||||||||
Aircraft Controls
|
|
$
|
33,342
|
|
|
$
|
29,080
|
|
|
$
|
97,590
|
|
|
$
|
83,372
|
|
Space and Defense Controls
|
|
16,513
|
|
|
12,789
|
|
|
49,643
|
|
|
33,258
|
|
||||
Industrial Systems
|
|
24,283
|
|
|
21,726
|
|
|
37,479
|
|
|
64,154
|
|
||||
Total operating profit
|
|
74,138
|
|
|
63,595
|
|
|
184,712
|
|
|
180,784
|
|
||||
Deductions from operating profit:
|
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
|
8,850
|
|
|
8,654
|
|
|
26,585
|
|
|
25,789
|
|
||||
Equity-based compensation expense
|
|
894
|
|
|
997
|
|
|
4,394
|
|
|
4,151
|
|
||||
Corporate and other expenses, net
|
|
9,439
|
|
|
5,671
|
|
|
25,275
|
|
|
17,880
|
|
||||
Earnings before income taxes
|
|
$
|
54,955
|
|
|
$
|
48,273
|
|
|
$
|
128,458
|
|
|
$
|
132,964
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||
Net sales:
|
|
|
|
|
||||
Space and Defense Controls
|
|
$
|
33,531
|
|
|
$
|
96,177
|
|
Industrial Systems
|
|
93,089
|
|
|
267,797
|
|
||
Total
|
|
$
|
126,620
|
|
|
$
|
363,974
|
|
Operating profit:
|
|
|
|
|
||||
Space and Defense Controls
|
|
$
|
2,784
|
|
|
$
|
5,669
|
|
Industrial Systems
|
|
9,255
|
|
|
28,664
|
|
||
Total
|
|
$
|
12,039
|
|
|
$
|
34,333
|
|
•
|
Defense market - primary and secondary flight controls for military aircraft, stabilization and automatic ammunition loading controls for armored combat vehicles, tactical and strategic missile steering controls and gun aiming controls.
|
•
|
Commercial aircraft market - primary and secondary flight controls for commercial aircraft.
|
•
|
Commercial space market - satellite positioning controls and thrust vector controls for space launch vehicles.
|
•
|
Industrial automation market - injection molding, metal forming, heavy industry, material and automotive testing and pilot training simulators.
|
•
|
Energy market - power generation, oil and gas exploration and wind energy.
|
•
|
Medical market - enteral clinical nutrition and infusion therapy pumps, ultrasonic sensors and surgical handpieces and CT scanners.
|
•
|
a strong leadership team that has positioned the company for growth,
|
•
|
utilizing our global capabilities and strong engineering heritage to innovate,
|
•
|
maintaining our technological excellence by solving our customers’ most demanding technical problems in applications "When Performance Really Matters
®
,"
|
•
|
continuing to invest in talent development to strengthen employee performance, and
|
•
|
maximizing customer value by implementing lean enterprise principles.
|
CONSOLIDATED RESULTS OF OPERATIONS
|
|
|
|
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||
(dollars and shares in millions, except per share data)
|
June 30, 2018
|
July 1, 2017
|
$ Variance
|
% Variance
|
|
June 30, 2018
|
July 1, 2017
|
$ Variance
|
% Variance
|
||||||||||||||
Net sales
|
$
|
692
|
|
$
|
626
|
|
$
|
66
|
|
11
|
%
|
|
$
|
2,009
|
|
$
|
1,848
|
|
$
|
160
|
|
9
|
%
|
Gross margin
|
28.5
|
%
|
29.1
|
%
|
|
|
|
28.6
|
%
|
29.2
|
%
|
|
|
||||||||||
Research and development expenses
|
$
|
31
|
|
$
|
36
|
|
$
|
(5
|
)
|
(15
|
%)
|
|
$
|
98
|
|
$
|
108
|
|
$
|
(10
|
)
|
(10
|
%)
|
Selling, general and administrative expenses as a percentage of sales
|
14.9
|
%
|
14.2
|
%
|
|
|
|
14.9
|
%
|
14.1
|
%
|
|
|
||||||||||
Interest expense
|
$
|
9
|
|
$
|
9
|
|
$
|
—
|
|
2
|
%
|
|
$
|
27
|
|
$
|
26
|
|
$
|
1
|
|
3
|
%
|
Restructuring expense
|
$
|
(2
|
)
|
$
|
—
|
|
$
|
(2
|
)
|
n/a
|
|
|
$
|
23
|
|
$
|
—
|
|
$
|
23
|
|
n/a
|
|
Other
|
$
|
1
|
|
$
|
—
|
|
$
|
1
|
|
n/a
|
|
|
$
|
—
|
|
$
|
12
|
|
$
|
(12
|
)
|
(100
|
%)
|
Effective tax rate
|
25.8
|
%
|
17.0
|
%
|
|
|
|
56.4
|
%
|
23.4
|
%
|
|
|
||||||||||
Net earnings attributable to Moog
|
$
|
41
|
|
$
|
40
|
|
$
|
1
|
|
1
|
%
|
|
$
|
56
|
|
$
|
103
|
|
$
|
(47
|
)
|
(46
|
%)
|
Diluted earnings per share attributable to Moog
|
$
|
1.13
|
|
$
|
1.11
|
|
$
|
0.02
|
|
2
|
%
|
|
$
|
1.55
|
|
$
|
2.83
|
|
$
|
(1.28
|
)
|
(45
|
%)
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||
(dollars in millions)
|
June 30, 2018
|
July 1, 2017
|
$ Variance
|
% Variance
|
|
June 30, 2018
|
July 1, 2017
|
$ Variance
|
% Variance
|
||||||||||||||
Net sales - military aircraft
|
$
|
144
|
|
$
|
130
|
|
$
|
14
|
|
11
|
%
|
|
$
|
424
|
|
$
|
394
|
|
$
|
30
|
|
8
|
%
|
Net sales - commercial aircraft
|
156
|
|
153
|
|
3
|
|
2
|
%
|
|
466
|
|
447
|
|
19
|
|
4
|
%
|
||||||
|
$
|
300
|
|
$
|
283
|
|
$
|
17
|
|
6
|
%
|
|
$
|
890
|
|
$
|
841
|
|
$
|
49
|
|
6
|
%
|
Operating profit
|
$
|
33
|
|
$
|
29
|
|
$
|
4
|
|
15
|
%
|
|
$
|
98
|
|
$
|
83
|
|
$
|
14
|
|
17
|
%
|
Operating margin
|
11.1
|
%
|
10.3
|
%
|
|
|
|
11.0
|
%
|
9.9
|
%
|
|
|
||||||||||
Backlog
|
|
|
|
|
|
$
|
726
|
|
$
|
543
|
|
$
|
183
|
|
34
|
%
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||
(dollars in millions)
|
June 30, 2018
|
July 1, 2017
|
$ Variance
|
% Variance
|
|
June 30, 2018
|
July 1, 2017
|
$ Variance
|
% Variance
|
||||||||||||||
Net sales
|
$
|
150
|
|
$
|
128
|
|
$
|
22
|
|
17
|
%
|
|
$
|
427
|
|
$
|
389
|
|
$
|
37
|
|
10
|
%
|
Operating profit
|
$
|
17
|
|
$
|
13
|
|
$
|
4
|
|
29
|
%
|
|
$
|
50
|
|
$
|
33
|
|
$
|
16
|
|
49
|
%
|
Operating margin
|
11.0
|
%
|
10.0
|
%
|
|
|
|
11.6
|
%
|
8.5
|
%
|
|
|
||||||||||
Backlog
|
|
|
|
|
|
$
|
453
|
|
$
|
386
|
|
$
|
67
|
|
17
|
%
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||
(dollars in millions)
|
June 30, 2018
|
July 1, 2017
|
$ Variance
|
% Variance
|
|
June 30, 2018
|
July 1, 2017
|
$ Variance
|
% Variance
|
||||||||||||||
Net sales
|
$
|
243
|
|
$
|
216
|
|
$
|
27
|
|
13
|
%
|
|
$
|
692
|
|
$
|
618
|
|
$
|
74
|
|
12
|
%
|
Operating profit (loss)
|
$
|
24
|
|
$
|
22
|
|
$
|
3
|
|
12
|
%
|
|
$
|
37
|
|
$
|
64
|
|
$
|
(27
|
)
|
(42
|
%)
|
Operating margin
|
10.0
|
%
|
10.1
|
%
|
|
|
|
5.4
|
%
|
10.4
|
%
|
|
|
||||||||||
Backlog
|
|
|
|
|
|
$
|
296
|
|
$
|
245
|
|
$
|
51
|
|
21
|
%
|
CONSOLIDATED AND SEGMENT OUTLOOK
|
|
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
|
|
|
|
2018 vs. 2017
|
|||||||||
(dollars in millions)
|
2018
|
|
2017
|
|
$ Variance
|
|
% Variance
|
|||||||
Net sales:
|
|
|
|
|
|
|
|
|||||||
Aircraft Controls
|
$
|
1,195
|
|
|
$
|
1,125
|
|
|
$
|
70
|
|
|
6
|
%
|
Space and Defense Controls
|
577
|
|
|
529
|
|
|
48
|
|
|
9
|
%
|
|||
Industrial Systems
|
934
|
|
|
843
|
|
|
91
|
|
|
11
|
%
|
|||
|
$
|
2,707
|
|
|
$
|
2,498
|
|
|
$
|
209
|
|
|
8
|
%
|
Operating profit:
|
|
|
|
|
|
|
|
|||||||
Aircraft Controls
|
$
|
130
|
|
|
$
|
114
|
|
|
$
|
16
|
|
|
14
|
%
|
Space and Defense Controls
|
68
|
|
|
49
|
|
|
19
|
|
|
40
|
%
|
|||
Industrial Systems
|
63
|
|
|
88
|
|
|
(25
|
)
|
|
(28
|
%)
|
|||
|
$
|
260
|
|
|
$
|
250
|
|
|
$
|
10
|
|
|
4
|
%
|
Operating margin:
|
|
|
|
|
|
|
|
|||||||
Aircraft Controls
|
10.8
|
%
|
|
10.1
|
%
|
|
|
|
|
|||||
Space and Defense Controls
|
11.8
|
%
|
|
9.2
|
%
|
|
|
|
|
|||||
Industrial Systems
|
6.7
|
%
|
|
10.4
|
%
|
|
|
|
|
|||||
|
9.6
|
%
|
|
10.0
|
%
|
|
|
|
|
|
Nine Months Ended
|
||||||||||
(dollars in millions)
|
June 30,
2018 |
July 1,
2017 |
$ Variance
|
% Variance
|
|||||||
Net cash provided (used) by:
|
|
|
|
|
|||||||
Operating activities
|
$
|
46
|
|
$
|
169
|
|
$
|
(123
|
)
|
(73
|
%)
|
Investing activities
|
(122
|
)
|
(83
|
)
|
(39
|
)
|
48
|
%
|
|||
Financing activities
|
(137
|
)
|
(68
|
)
|
(69
|
)
|
102
|
%
|
•
|
the markets we serve are cyclical and sensitive to domestic and foreign economic conditions and events, which may cause our operating results to fluctuate;
|
•
|
we operate in highly competitive markets with competitors who may have greater resources than we possess;
|
•
|
we depend heavily on government contracts that may not be fully funded or may be terminated, and the failure to receive funding or the termination of one or more of these contracts could reduce our sales and increase our costs;
|
•
|
we make estimates in accounting for long-term contracts, and changes in these estimates may have significant impacts on our earnings;
|
•
|
we enter into fixed-price contracts, which could subject us to losses if we have cost overruns;
|
•
|
we may not realize the full amounts reflected in our backlog as revenue, which could adversely affect our future revenue and growth prospects;
|
•
|
if our subcontractors or suppliers fail to perform their contractual obligations, our prime contract performance and our ability to obtain future business could be materially and adversely impacted;
|
•
|
contracting on government programs is subject to significant regulation, including rules related to bidding, billing and accounting kickbacks and false claims, and any non-compliance could subject us to fines and penalties or possible debarment;
|
•
|
the loss of The Boeing Company as a customer or a significant reduction in sales to The Boeing Company could adversely impact our operating results;
|
•
|
our new product research and development efforts may not be successful which could reduce our sales and earnings;
|
•
|
our inability to adequately enforce and protect our intellectual property or defend against assertions of infringement could prevent or restrict our ability to compete;
|
•
|
our business operations may be adversely affected by information systems interruptions, intrusions or new software implementations;
|
•
|
our indebtedness and restrictive covenants under our credit facilities could limit our operational and financial flexibility;
|
•
|
significant changes in discount rates, rates of return on pension assets, mortality tables and other factors could adversely affect our earnings and equity and increase our pension funding requirements;
|
•
|
a write-off of all or part of our goodwill or other intangible assets could adversely affect our operating results and net worth;
|
•
|
our sales and earnings may be affected if we cannot identify, acquire or integrate strategic acquisitions, or if we engage in divesting activities;
|
•
|
our operations in foreign countries expose us to political and currency risks and adverse changes in local legal and regulatory environments;
|
•
|
unforeseen exposure to additional income tax liabilities may affect our operating results;
|
•
|
government regulations could limit our ability to sell our products outside the United States and otherwise adversely affect our business;
|
•
|
governmental regulations and customer demands related to conflict minerals may adversely impact our operating results;
|
•
|
the failure or misuse of our products may damage our reputation, necessitate a product recall or result in claims against us that exceed our insurance coverage, thereby requiring us to pay significant damages;
|
•
|
future terror attacks, war, natural disasters or other catastrophic events beyond our control could negatively impact our business;
|
•
|
our operations are subject to environmental laws, and complying with those laws may cause us to incur significant costs; and
|
•
|
we are involved in various legal proceedings, the outcome of which may be unfavorable to us.
|
(a)
|
Disclosure Controls and Procedures. We carried out an evaluation, under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Exchange Act Rules 13a-15(e) and 15d-15(e). Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that these disclosure controls and procedures are effective as of the end of the period covered by this report, to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.
|
(b)
|
Changes in Internal Control over Financial Reporting. There have been no changes during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
|
(c)
|
The following table summarizes our purchases of our common stock for the quarter ended
June 30, 2018
.
|
Period
|
|
(a) Total
Number of Shares Purchased (1)(2) |
|
(b) Average
Price Paid Per Share |
|
(c) Total number
of Shares Purchased as Part of Publicly Announced Plans or Programs (3) |
|
(d) Maximum
Number (or Approx. Dollar Value) of Shares that May Yet Be Purchased Under Plans or Programs (3) |
|||||
April 1, 2018 - April 30, 2018
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
3,349,719
|
|
May 1, 2018 - May 31, 2018
|
|
1,110
|
|
|
82.93
|
|
|
—
|
|
|
3,349,719
|
|
|
June 1, 2018 - June 30, 2018
|
|
6,774
|
|
|
78.24
|
|
|
—
|
|
|
3,349,719
|
|
|
Total
|
|
7,884
|
|
|
$
|
78.90
|
|
|
—
|
|
|
3,349,719
|
|
(1)
|
Reflects purchases by the Moog Inc. Stock Employee Compensation Trust Agreement ("SECT") of shares of Class B common stock from the Moog Inc. Retirement Savings Plan ("RSP") at average prices as follows: 6,774 shares at $78.24 per share during June.
|
(2)
|
In connection with the exercise of equity-based compensation awards, we accept delivery of shares to pay for the exercise price and withhold shares for tax withholding obligations. In May, we accepted delivery of 1,110 shares at $82.93 per share, in connection with the exercise of equity-based awards.
|
(3)
|
The Board of Directors has authorized a share repurchase program. This program has been amended from time to time to authorize additional repurchases up to an aggregate 13 million common shares. The program permits the purchase of shares of Class A or Class B common stock in open market or privately negotiated transactions at the discretion of management.
|
(a)
|
Exhibits
|
||
|
Restated By-laws of Moog Inc., as amended, effective May 8, 2018.
|
||
|
Amendment No. 1 to Moog Inc. Stock Employee Compensation Trust, effective May 8, 2018.
|
||
|
First Amendment to the Moog Inc. Defined Contribution Supplemental Executive Retirement Plan, effective July 26, 2018.
|
||
|
First Amendment to the Moog Inc. Management Short Term Incentive Plan, effective July 26, 2018.
|
||
|
Certification of Chief Executive Officer pursuant to Exchange Act Rule 13a-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
||
|
Certification of Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
||
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
||
|
101
|
Interactive Date files (submitted electronically herewith)
|
(101.INS)
|
XBRL Instance Document
|
|
|
(101.SCH)
|
XBRL Taxonomy Extension Schema Document
|
|
|
(101.CAL)
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
(101.DEF)
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
(101.LAB)
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
(101.PRE)
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
Moog Inc.
|
|
|
|
|
|
|
|
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
Date:
|
July 27, 2018
|
|
By
|
/s/ John R. Scannell
|
|
|
|
|
|
John R. Scannell
|
|
|
|
|
|
Chairman Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
|
|
Date:
|
July 27, 2018
|
|
By
|
/s/ Donald R. Fishback
|
|
|
|
|
|
Donald R. Fishback
|
|
|
|
|
|
Vice President
Chief Financial Officer
(Principal Financial Officer)
|
|
|
|
|
|
|
|
Date:
|
July 27, 2018
|
|
By
|
/s/ Jennifer Walter
|
|
|
|
|
|
Jennifer Walter
|
|
|
|
|
|
Vice President - Finance
Controller (Principal Accounting Officer)
|
|
|
|
|
|
|
|
(a)
|
the submission to shareholders of any action as to which shareholders’ authorization is required by law;
|
(b)
|
the filling of vacancies in the Board of Directors or on any committee;
|
(c)
|
the fixing of compensation of any director for serving on the Board or on any committee;
|
(d)
|
the amendment or repeal of these By-Laws, or the adoption of new By-Laws;
|
(e)
|
the amendment or repeal of any resolution of the Board which by its terms shall not be so amendable or repealable.
|
2.
|
The Plan is amended to add a new Section 1.2(z), as follows:
|
•
|
2018 Supplemental Bonus
. With respect to the Plan Year beginning October 1, 2017, each eligible employee will be eligible to receive a “2018 Supplemental Bonus” in addition to any Bonus the eligible employee is otherwise eligible to receive for the Plan Year. The decision to pay and the amount of any 2018 Supplemental Bonus, if any, will be in the sole discretion of the Committee.
|
•
|
2019 Bonus
. For the Plan Year beginning September 30, 2018, the Bonus an eligible employee will be eligible to receive for such Plan Year will equal the difference between (i) the Bonus the eligible employee would otherwise be entitled to receive for the Plan Year without regard to this provision, less (ii) the amount of any 2018 Supplemental Bonus paid to such eligible employee. In no event will the Bonus for the Plan Year beginning on September 30, 2018 be less than zero.
|
1.
|
I have reviewed this
quarterly report
on
Form 10-Q
of Moog 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 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 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 registrant’s board of directors (or persons performing 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.
|
1.
|
I have reviewed this
quarterly report
on
Form 10-Q
of Moog 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 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 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 registrant’s board of directors (or persons performing 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.
|