Delaware
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90-1002689
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
|
|
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1151 Maplewood Drive
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Itasca, Illinois
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60143
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
þ
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Accelerated filer
o
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Non-accelerated filer
o
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(Do not check if a smaller reporting company)
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Smaller reporting company
o
|
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Emerging growth company
o
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Page
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Three Months Ended March 31,
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||||||
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2017
|
|
2016
|
||||
Revenues
|
$
|
193.7
|
|
|
$
|
185.3
|
|
Cost of goods sold
|
121.8
|
|
|
117.3
|
|
||
Restructuring charges - cost of goods sold
|
4.3
|
|
|
1.2
|
|
||
Gross profit
|
67.6
|
|
|
66.8
|
|
||
Research and development expenses
|
26.2
|
|
|
26.1
|
|
||
Selling and administrative expenses
|
38.1
|
|
|
43.1
|
|
||
Restructuring charges
|
0.7
|
|
|
3.5
|
|
||
Operating expenses
|
65.0
|
|
|
72.7
|
|
||
Operating earnings (loss)
|
2.6
|
|
|
(5.9
|
)
|
||
Interest expense, net
|
5.2
|
|
|
3.7
|
|
||
Other expense, net
|
2.3
|
|
|
0.5
|
|
||
Loss before income taxes and discontinued operations
|
(4.9
|
)
|
|
(10.1
|
)
|
||
(Benefit from) provision for income taxes
|
(0.2
|
)
|
|
2.4
|
|
||
Loss from continuing operations
|
(4.7
|
)
|
|
(12.5
|
)
|
||
Earnings (loss) from discontinued operations, net
|
1.5
|
|
|
(16.9
|
)
|
||
Net loss
|
$
|
(3.2
|
)
|
|
$
|
(29.4
|
)
|
|
|
|
|
||||
Loss per share from continuing operations:
|
|
|
|
||||
Basic
|
$
|
(0.05
|
)
|
|
$
|
(0.14
|
)
|
Diluted
|
$
|
(0.05
|
)
|
|
$
|
(0.14
|
)
|
|
|
|
|
||||
Earnings (loss) per share from discontinued operations:
|
|
|
|
||||
Basic
|
$
|
0.01
|
|
|
$
|
(0.19
|
)
|
Diluted
|
$
|
0.01
|
|
|
$
|
(0.19
|
)
|
|
|
|
|
||||
Net loss per share:
|
|
|
|
||||
Basic
|
$
|
(0.04
|
)
|
|
$
|
(0.33
|
)
|
Diluted
|
$
|
(0.04
|
)
|
|
$
|
(0.33
|
)
|
|
|
|
|
||||
Weighted average common shares outstanding:
|
|
|
|
||||
Basic
|
88,973,503
|
|
|
88,536,740
|
|
||
Diluted
|
88,973,503
|
|
|
88,536,740
|
|
|
Three Months Ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
Net loss
|
$
|
(3.2
|
)
|
|
$
|
(29.4
|
)
|
|
|
|
|
||||
Other comprehensive earnings (loss), net of tax
|
|
|
|
||||
Foreign currency translation
|
14.7
|
|
|
13.9
|
|
||
|
|
|
|
||||
Changes in fair value of cash flow hedges:
|
|
|
|
||||
Unrealized net gains arising during period
|
0.6
|
|
|
1.7
|
|
||
Net losses (gains) reclassified into earnings
|
1.4
|
|
|
(0.1
|
)
|
||
Total cash flow hedges
|
2.0
|
|
|
1.6
|
|
||
|
|
|
|
||||
Other comprehensive earnings, net of tax
|
16.7
|
|
|
15.5
|
|
||
|
|
|
|
||||
Comprehensive earnings (loss)
|
$
|
13.5
|
|
|
$
|
(13.9
|
)
|
|
March 31, 2017
|
|
December 31, 2016
|
||||
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
63.3
|
|
|
$
|
66.2
|
|
Receivables, net of allowances of $1.6 and $1.7
|
131.7
|
|
|
145.1
|
|
||
Inventories, net
|
117.5
|
|
|
108.2
|
|
||
Prepaid and other current assets
|
11.8
|
|
|
10.6
|
|
||
Total current assets
|
324.3
|
|
|
330.1
|
|
||
Property, plant and equipment, net
|
195.0
|
|
|
186.2
|
|
||
Goodwill
|
906.1
|
|
|
894.6
|
|
||
Intangible assets, net
|
77.7
|
|
|
77.4
|
|
||
Other assets and deferred charges
|
26.4
|
|
|
25.8
|
|
||
Assets of discontinued operations
|
0.8
|
|
|
0.9
|
|
||
Total assets
|
$
|
1,530.3
|
|
|
$
|
1,515.0
|
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
|
||
Current maturities of long-term debt
|
$
|
13.2
|
|
|
$
|
9.7
|
|
Accounts payable
|
72.4
|
|
|
71.8
|
|
||
Accrued compensation and employee benefits
|
24.0
|
|
|
34.7
|
|
||
Other accrued expenses
|
30.2
|
|
|
26.0
|
|
||
Federal and other taxes on income
|
7.8
|
|
|
6.8
|
|
||
Total current liabilities
|
147.6
|
|
|
149.0
|
|
||
Long-term debt
|
286.6
|
|
|
288.5
|
|
||
Deferred income taxes
|
20.3
|
|
|
21.7
|
|
||
Other liabilities
|
43.0
|
|
|
41.4
|
|
||
Liabilities of discontinued operations
|
5.4
|
|
|
6.0
|
|
||
Commitments and contingencies (Note 13)
|
|
|
|
|
|
||
Stockholders' equity:
|
|
|
|
||||
Preferred stock - $0.01 par value; 10,000,000 shares authorized; none issued
|
—
|
|
|
—
|
|
||
Common stock - $0.01 par value; 400,000,000 shares authorized; 89,233,039 and 88,737,284 shares issued at March 31, 2017 and December 31, 2016, respectively
|
0.9
|
|
|
0.9
|
|
||
Additional paid-in capital
|
1,505.3
|
|
|
1,499.8
|
|
||
Accumulated deficit
|
(363.4
|
)
|
|
(360.2
|
)
|
||
Accumulated other comprehensive loss
|
(115.4
|
)
|
|
(132.1
|
)
|
||
Total stockholders' equity
|
1,027.4
|
|
|
1,008.4
|
|
||
Total liabilities and stockholders' equity
|
$
|
1,530.3
|
|
|
$
|
1,515.0
|
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Loss
|
|
Total Stockholders' Equity
|
||||||||||
Balance at December 31, 2016
|
$
|
0.9
|
|
|
$
|
1,499.8
|
|
|
$
|
(360.2
|
)
|
|
$
|
(132.1
|
)
|
|
$
|
1,008.4
|
|
Net loss
|
—
|
|
|
—
|
|
|
(3.2
|
)
|
|
—
|
|
|
(3.2
|
)
|
|||||
Other comprehensive earnings, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
16.7
|
|
|
16.7
|
|
|||||
Stock-based compensation expense
|
—
|
|
|
6.1
|
|
|
—
|
|
|
—
|
|
|
6.1
|
|
|||||
Common stock issued for exercise of stock options
|
—
|
|
|
2.8
|
|
|
—
|
|
|
—
|
|
|
2.8
|
|
|||||
Tax on restricted stock unit vesting
|
—
|
|
|
(3.4
|
)
|
|
—
|
|
|
—
|
|
|
(3.4
|
)
|
|||||
Balance at March 31, 2017
|
$
|
0.9
|
|
|
$
|
1,505.3
|
|
|
$
|
(363.4
|
)
|
|
$
|
(115.4
|
)
|
|
$
|
1,027.4
|
|
|
Three Months Ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
Operating Activities
|
|
|
|
||||
Net loss
|
$
|
(3.2
|
)
|
|
$
|
(29.4
|
)
|
Adjustments to reconcile net loss to cash from operating activities:
|
|
|
|
||||
Depreciation and amortization
|
15.3
|
|
|
21.7
|
|
||
Stock-based compensation
|
6.1
|
|
|
5.4
|
|
||
Non-cash interest expense and amortization of debt issuance costs
|
1.7
|
|
|
0.2
|
|
||
Loss on disposal of fixed assets
|
0.1
|
|
|
0.7
|
|
||
Deferred income taxes
|
(2.1
|
)
|
|
0.3
|
|
||
Other, net
|
1.2
|
|
|
1.6
|
|
||
Cash effect of changes in assets and liabilities (excluding effects of foreign exchange):
|
|
|
|
||||
Receivables, net
|
14.9
|
|
|
50.1
|
|
||
Inventories, net
|
(8.1
|
)
|
|
(4.3
|
)
|
||
Prepaid and other current assets
|
(1.0
|
)
|
|
(3.5
|
)
|
||
Accounts payable
|
(2.8
|
)
|
|
(14.8
|
)
|
||
Accrued compensation and employee benefits
|
(11.2
|
)
|
|
(8.1
|
)
|
||
Other accrued expenses
|
5.8
|
|
|
1.0
|
|
||
Accrued and deferred taxes, net
|
1.0
|
|
|
(1.0
|
)
|
||
Other non-current assets and non-current liabilities
|
0.2
|
|
|
(0.1
|
)
|
||
Net cash provided by operating activities
|
17.9
|
|
|
19.8
|
|
||
|
|
|
|
||||
Investing Activities
|
|
|
|
|
|
||
Proceeds from the sale of property, plant and equipment
|
—
|
|
|
0.7
|
|
||
Additions to property, plant and equipment
|
(17.7
|
)
|
|
(9.8
|
)
|
||
Acquisition of business (net of cash acquired)
|
(2.5
|
)
|
|
—
|
|
||
Net cash used in investing activities
|
(20.2
|
)
|
|
(9.1
|
)
|
||
|
|
|
|
||||
Financing Activities
|
|
|
|
|
|
||
Payments under revolving credit facility
|
—
|
|
|
(20.0
|
)
|
||
Principal payments on term loan debt
|
—
|
|
|
(7.5
|
)
|
||
Debt issuance costs
|
—
|
|
|
(0.4
|
)
|
||
Net proceeds from exercise of stock-based awards
|
2.8
|
|
|
—
|
|
||
Payments of capital lease obligations
|
(0.4
|
)
|
|
(1.1
|
)
|
||
Payment of taxes related to net share settlement of equity awards
|
(3.4
|
)
|
|
(0.8
|
)
|
||
Net cash used in financing activities
|
(1.0
|
)
|
|
(29.8
|
)
|
||
|
|
|
|
||||
Effect of exchange rate changes on cash and cash equivalents
|
0.4
|
|
|
—
|
|
||
|
|
|
|
||||
Net decrease in cash and cash equivalents
|
(2.9
|
)
|
|
(19.1
|
)
|
||
Cash and cash equivalents at beginning of period
|
66.2
|
|
|
63.3
|
|
||
Cash and cash equivalents at end of period
|
$
|
63.3
|
|
|
$
|
44.2
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
•
|
Audio Segment
|
•
|
Precision Devices ("PD") Segment
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2017
|
|
2016
|
||||
Revenues
|
$
|
—
|
|
|
$
|
20.4
|
|
Cost of goods sold
|
—
|
|
|
28.6
|
|
||
Restructuring charges - cost of goods sold
|
—
|
|
|
2.1
|
|
||
Gross loss
|
—
|
|
|
(10.3
|
)
|
||
Research and development expenses
|
—
|
|
|
3.5
|
|
||
Selling and administrative expenses
|
(0.1
|
)
|
|
3.2
|
|
||
Restructuring charges
|
—
|
|
|
0.4
|
|
||
Operating (income) expenses
|
(0.1
|
)
|
|
7.1
|
|
||
|
|
|
|
||||
Earnings (loss) from discontinued operations before taxes
|
0.1
|
|
|
(17.4
|
)
|
||
Benefit from income taxes
|
(1.4
|
)
|
|
(0.5
|
)
|
||
Earnings (loss) from discontinued operations, net of tax
|
$
|
1.5
|
|
|
$
|
(16.9
|
)
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
(in millions)
|
March 31, 2017
|
|
December 31, 2016
|
||||
Assets of Discontinued Operations:
|
|
|
|
||||
Accounts receivable
|
$
|
0.6
|
|
|
$
|
0.6
|
|
Prepaid and other current assets
|
0.2
|
|
|
0.3
|
|
||
Total current assets
|
0.8
|
|
|
0.9
|
|
||
Total assets
(1)
|
$
|
0.8
|
|
|
$
|
0.9
|
|
|
|
|
|
||||
Liabilities of Discontinued Operations:
|
|
|
|
||||
Accounts payable
|
$
|
2.4
|
|
|
$
|
2.8
|
|
Other current liabilities
|
3.0
|
|
|
3.2
|
|
||
Total current liabilities
|
5.4
|
|
|
6.0
|
|
||
Total liabilities
(1)
|
$
|
5.4
|
|
|
$
|
6.0
|
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2017
|
|
2016
|
||||
Depreciation
|
$
|
—
|
|
|
$
|
2.7
|
|
Additions to property, plant and equipment
|
$
|
—
|
|
|
$
|
1.4
|
|
(in millions)
|
March 31, 2017
|
|
December 31, 2016
|
||||
Raw materials
|
$
|
64.2
|
|
|
$
|
64.1
|
|
Work in progress
|
20.0
|
|
|
18.0
|
|
||
Finished goods
|
68.1
|
|
|
60.9
|
|
||
Subtotal
|
152.3
|
|
|
143.0
|
|
||
Less reserves
|
(34.8
|
)
|
|
(34.8
|
)
|
||
Total
|
$
|
117.5
|
|
|
$
|
108.2
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
(in millions)
|
March 31, 2017
|
|
December 31, 2016
|
||||
Land
|
$
|
9.2
|
|
|
$
|
9.2
|
|
Buildings and improvements
|
116.3
|
|
|
112.3
|
|
||
Machinery, equipment and other
|
487.6
|
|
|
464.8
|
|
||
Subtotal
|
613.1
|
|
|
586.3
|
|
||
Less accumulated depreciation
|
(418.1
|
)
|
|
(400.1
|
)
|
||
Total
|
$
|
195.0
|
|
|
$
|
186.2
|
|
(in millions)
|
Audio
|
|
Precision Devices
|
|
Total
|
||||||
Balance at December 31, 2016
|
$
|
708.7
|
|
|
$
|
185.9
|
|
|
$
|
894.6
|
|
Foreign currency translation
|
11.6
|
|
|
(0.1
|
)
|
|
11.5
|
|
|||
Balance at March 31, 2017
|
$
|
720.3
|
|
|
$
|
185.8
|
|
|
$
|
906.1
|
|
|
March 31, 2017
|
|
December 31, 2016
|
||||||||||||
(in millions)
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
Amortized intangible assets:
|
|
|
|
|
|
|
|
||||||||
Trademarks
|
$
|
0.3
|
|
|
$
|
0.2
|
|
|
$
|
0.3
|
|
|
$
|
0.2
|
|
Patents
|
42.9
|
|
|
20.5
|
|
|
42.9
|
|
|
19.3
|
|
||||
Customer Relationships
|
159.5
|
|
|
153.4
|
|
|
156.2
|
|
|
152.8
|
|
||||
Unpatented Technologies
|
92.2
|
|
|
75.1
|
|
|
92.2
|
|
|
73.9
|
|
||||
Other
|
3.1
|
|
|
3.1
|
|
|
3.1
|
|
|
3.1
|
|
||||
Total
|
298.0
|
|
|
252.3
|
|
|
294.7
|
|
|
249.3
|
|
||||
Unamortized intangible assets:
|
|
|
|
|
|
|
|
||||||||
Trademarks
|
32.0
|
|
|
|
|
32.0
|
|
|
|
||||||
Total intangible assets, net
|
$
|
77.7
|
|
|
|
|
$
|
77.4
|
|
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2017
|
|
2016
|
||||
Audio
|
$
|
4.7
|
|
|
$
|
3.0
|
|
Precision Devices
|
0.2
|
|
|
1.3
|
|
||
Corporate
|
0.1
|
|
|
0.4
|
|
||
Total
|
$
|
5.0
|
|
|
$
|
4.7
|
|
(in millions)
|
Severance Pay and Benefits
|
|
Contract Termination and Other Costs
|
|
Total
|
||||||
Balance at December 31, 2016
|
$
|
3.4
|
|
|
$
|
0.4
|
|
|
$
|
3.8
|
|
Restructuring charges
|
5.0
|
|
|
—
|
|
|
5.0
|
|
|||
Payments
|
(1.1
|
)
|
|
—
|
|
|
(1.1
|
)
|
|||
Balance at March 31, 2017
|
$
|
7.3
|
|
|
$
|
0.4
|
|
|
$
|
7.7
|
|
(in millions)
|
March 31, 2017
|
|
December 31, 2016
|
||||
Other accrued expenses
|
$
|
7.5
|
|
|
$
|
3.6
|
|
Other liabilities
|
0.2
|
|
|
0.2
|
|
||
Total
|
$
|
7.7
|
|
|
$
|
3.8
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
Hedge Type
|
Balance Sheet Line Item
|
March 31, 2017
|
|
December 31, 2016
|
||||
Cash flow hedges
|
Other accrued expenses
|
$
|
1.6
|
|
|
$
|
3.6
|
|
Cash flow hedges
|
Other liabilities
|
0.1
|
|
|
0.2
|
|
||
Economic hedges
|
Other accrued expenses
|
0.1
|
|
|
—
|
|
(in millions)
|
|
Three Months Ended March 31,
|
||||||
Hedge Type
|
Income Statement Line
|
2017
|
|
2016
|
||||
Economic hedges
|
Other expense, net
|
$
|
(0.3
|
)
|
|
$
|
0.6
|
|
(in millions)
|
|
Three Months Ended March 31,
|
||||||
Hedge Type
|
Income Statement Line
|
2017
|
|
2016
|
||||
Cash flow hedges
|
Other expense, net
|
$
|
1.4
|
|
|
$
|
0.1
|
|
(in millions)
|
March 31, 2017
|
|
December 31, 2016
|
||||
3.25% Convertible Senior Notes
|
$
|
136.7
|
|
|
$
|
135.1
|
|
Term loan and revolving credit facility
|
163.1
|
|
|
163.1
|
|
||
Total
|
299.8
|
|
|
298.2
|
|
||
Less: current maturities
|
13.2
|
|
|
9.7
|
|
||
Total long-term debt
|
$
|
286.6
|
|
|
$
|
288.5
|
|
(in millions)
|
Q2 - Q4 2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
||||||||||
Debt principal payments
(1)
|
$
|
10.8
|
|
|
$
|
14.4
|
|
|
$
|
138.3
|
|
|
$
|
—
|
|
|
$
|
172.5
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
=
|
during any calendar quarter and only during such calendar quarters, if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day;
|
=
|
during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; or
|
=
|
upon the occurrence of specified corporate events.
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
(in millions)
|
March 31, 2017
|
|
December 31, 2016
|
||||
Liability component:
|
|
|
|
||||
Principal
|
$
|
172.5
|
|
|
$
|
172.5
|
|
Less: debt issuance costs, debt discount, net of amortization
|
(35.8
|
)
|
|
(37.4
|
)
|
||
Total
|
136.7
|
|
|
135.1
|
|
||
Less: current maturities
(1)
|
(0.9
|
)
|
|
(0.9
|
)
|
||
Long-term portion
|
$
|
137.6
|
|
|
$
|
136.0
|
|
|
|
|
|
||||
Equity component
(2)
|
$
|
29.9
|
|
|
$
|
29.9
|
|
|
Three Months Ended March 31,
|
||
(in millions)
|
2017
|
||
3.25% coupon
|
$
|
1.4
|
|
Amortization of debt issuance costs
|
0.2
|
|
|
Amortization of debt discount
|
1.4
|
|
|
Total
|
$
|
3.0
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
(in millions)
|
March 31, 2017
|
|
December 31, 2016
|
||||
Term loan due January 2019
|
$
|
118.5
|
|
|
$
|
118.5
|
|
$300.0 million revolving credit facility due January 2019
|
45.0
|
|
|
45.0
|
|
||
Less: debt issuance costs, net of amortization
|
(0.4
|
)
|
|
(0.4
|
)
|
||
Total
|
163.1
|
|
|
163.1
|
|
||
Less: current maturities
(1)
|
14.1
|
|
|
10.6
|
|
||
Long-term portion
|
$
|
149.0
|
|
|
$
|
152.5
|
|
|
Three Months Ended
|
|
Three Months Ended
|
||||||||||||||||||||
|
March 31, 2017
|
|
March 31, 2016
|
||||||||||||||||||||
(in millions)
|
Pre-tax
|
|
Tax
|
|
Net of tax
|
|
Pre-tax
|
|
Tax
|
|
Net of tax
|
||||||||||||
Foreign currency translation
|
$
|
14.7
|
|
|
$
|
—
|
|
|
$
|
14.7
|
|
|
$
|
13.9
|
|
|
$
|
—
|
|
|
$
|
13.9
|
|
Changes in fair value of cash flow hedges
|
2.2
|
|
|
(0.2
|
)
|
|
2.0
|
|
|
1.6
|
|
|
—
|
|
|
1.6
|
|
||||||
Other comprehensive earnings, net of tax
|
$
|
16.9
|
|
|
$
|
(0.2
|
)
|
|
$
|
16.7
|
|
|
$
|
15.5
|
|
|
$
|
—
|
|
|
$
|
15.5
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
(in millions)
|
|
Cash flow hedges
|
|
Cumulative foreign currency translation adjustments
|
|
Employee benefit plans
|
|
Total
|
||||||||
Balance at December 31, 2016
|
|
$
|
(3.2
|
)
|
|
$
|
(112.3
|
)
|
|
$
|
(16.6
|
)
|
|
$
|
(132.1
|
)
|
Other comprehensive earnings
|
|
2.0
|
|
|
14.7
|
|
|
—
|
|
|
16.7
|
|
||||
Balance at March 31, 2017
|
|
$
|
(1.2
|
)
|
|
$
|
(97.6
|
)
|
|
$
|
(16.6
|
)
|
|
$
|
(115.4
|
)
|
(in millions)
|
|
Cash flow hedges
|
|
Cumulative foreign currency translation adjustments
|
|
Employee benefit plans
|
|
Total
|
||||||||
Balance at December 31, 2015
|
|
$
|
(1.6
|
)
|
|
$
|
(113.1
|
)
|
|
$
|
(11.5
|
)
|
|
$
|
(126.2
|
)
|
Other comprehensive earnings
|
|
1.6
|
|
|
13.9
|
|
|
—
|
|
|
15.5
|
|
||||
Balance at March 31, 2016
|
|
$
|
—
|
|
|
$
|
(99.2
|
)
|
|
$
|
(11.5
|
)
|
|
$
|
(110.7
|
)
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
|
Three Months Ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
Risk-free interest rate
|
1.93%
|
|
1.04%
|
||||
Dividend yield
|
—%
|
|
—%
|
||||
Expected life (years)
|
4.5
|
|
4.5
|
||||
Volatility
|
38.8%
|
|
39.6%
|
||||
Fair value at date of grant
|
$6.61
|
to
|
$6.73
|
|
$3.76
|
|
SSARs
|
|
Stock Options
|
||||||||||||||||||||||
|
Number of Shares
|
|
Weighted-Average Exercise Price
|
|
Aggregate Intrinsic Value
|
|
Weighted-Average Remaining Contractual Term (Years)
|
|
Number of Shares
|
|
Weighted-Average Exercise Price
|
|
Aggregate Intrinsic Value
|
|
Weighted-Average Remaining Contractual Term (Years)
|
||||||||||
Outstanding at December 31, 2016
|
898,718
|
|
|
$
|
21.25
|
|
|
|
|
|
|
4,684,117
|
|
|
$
|
18.03
|
|
|
|
|
|
||||
Granted
|
—
|
|
|
—
|
|
|
|
|
|
|
756,496
|
|
|
19.25
|
|
|
|
|
|
||||||
Exercised
|
—
|
|
|
—
|
|
|
|
|
|
|
(194,513
|
)
|
|
14.30
|
|
|
|
|
|
||||||
Forfeited
|
—
|
|
|
—
|
|
|
|
|
|
|
(147,803
|
)
|
|
14.80
|
|
|
|
|
|
||||||
Expired
|
—
|
|
|
—
|
|
|
|
|
|
|
(18,421
|
)
|
|
22.47
|
|
|
|
|
|
||||||
Outstanding at March 31, 2017
|
898,718
|
|
|
$
|
21.25
|
|
|
$
|
0.8
|
|
|
4.7
|
|
5,079,876
|
|
|
$
|
18.42
|
|
|
$
|
14.7
|
|
|
5.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Exercisable at March 31, 2017
|
898,718
|
|
|
$
|
21.25
|
|
|
$
|
0.8
|
|
|
4.7
|
|
2,208,632
|
|
|
$
|
20.78
|
|
|
$
|
4.7
|
|
|
4.8
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
|
Share units
|
|
Weighted-average grant date fair value
|
|||
Unvested at December 31, 2016
|
2,074,998
|
|
|
$
|
14.94
|
|
Granted
|
1,110,441
|
|
|
19.27
|
|
|
Vested
|
(478,065
|
)
|
|
17.36
|
|
|
Forfeited
|
(108,007
|
)
|
|
14.51
|
|
|
Unvested at March 31, 2017
|
2,599,367
|
|
|
$
|
16.34
|
|
|
Share units
|
|
Weighted-average grant date fair value
|
|||
Unvested at December 31, 2016
|
—
|
|
|
$
|
—
|
|
Granted
|
171,830
|
|
|
15.40
|
|
|
Vested
|
—
|
|
|
—
|
|
|
Forfeited
|
—
|
|
|
—
|
|
|
Unvested at March 31, 2017
|
171,830
|
|
|
$
|
15.40
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
|
Three Months Ended March 31,
|
||||||
(in millions except share and per share amounts)
|
2017
|
|
2016
|
||||
Loss from continuing operations
|
$
|
(4.7
|
)
|
|
$
|
(12.5
|
)
|
Earnings (loss) from discontinued operations, net
|
$
|
1.5
|
|
|
$
|
(16.9
|
)
|
Net loss
|
$
|
(3.2
|
)
|
|
$
|
(29.4
|
)
|
|
|
|
|
||||
Basic (loss) earnings per common share:
|
|
|
|
||||
Loss from continuing operations
|
$
|
(0.05
|
)
|
|
$
|
(0.14
|
)
|
Earnings (loss) from discontinued operations, net
|
$
|
0.01
|
|
|
$
|
(0.19
|
)
|
Net loss
|
$
|
(0.04
|
)
|
|
$
|
(0.33
|
)
|
|
|
|
|
||||
Weighted average shares outstanding
|
88,973,503
|
|
|
88,536,740
|
|
||
|
|
|
|
||||
Diluted (loss) earnings per common share:
|
|
|
|
|
|
||
Loss from continuing operations
|
$
|
(0.05
|
)
|
|
$
|
(0.14
|
)
|
Earnings (loss) from discontinued operations, net
|
$
|
0.01
|
|
|
$
|
(0.19
|
)
|
Net loss
|
$
|
(0.04
|
)
|
|
$
|
(0.33
|
)
|
|
|
|
|
||||
Weighted-average shares outstanding
|
88,973,503
|
|
|
88,536,740
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
•
|
Audio Segment
|
•
|
Precision Devices ("PD") Segment
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2017
|
|
2016
|
||||
Revenue:
|
|
|
|
||||
Audio
|
$
|
144.2
|
|
|
$
|
137.9
|
|
Precision Devices
|
49.5
|
|
|
47.4
|
|
||
Total consolidated revenue
|
$
|
193.7
|
|
|
$
|
185.3
|
|
|
|
|
|
||||
Earnings (loss) from continuing operations before interest and income taxes:
|
|
|
|
|
|||
Audio
|
$
|
8.9
|
|
|
$
|
5.7
|
|
Precision Devices
|
5.5
|
|
|
1.3
|
|
||
Total segments
|
14.4
|
|
|
7.0
|
|
||
Corporate expense / other
|
14.1
|
|
|
13.4
|
|
||
Interest expense, net
|
5.2
|
|
|
3.7
|
|
||
Loss before income taxes and discontinued operations
|
(4.9
|
)
|
|
(10.1
|
)
|
||
(Benefit from) provision for income taxes
|
(0.2
|
)
|
|
2.4
|
|
||
Loss from continuing operations
|
$
|
(4.7
|
)
|
|
$
|
(12.5
|
)
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
|
(unaudited)
|
|
o
|
The rate of multi-microphone and smart microphone adoption and market adoption of our "intelligent audio" solutions across our mobile, ear and IoT markets;
|
o
|
the pace and success of achieving the cost savings from our announced restructurings and acquisitions;
|
o
|
our ability to slow and offset price erosion in certain of our microphone products;
|
o
|
delays in customer product introductions and other related customer challenges that may occur;
|
o
|
MEMS microphone demand from our largest customers, in particular, two large North American OEM customers, a Korean OEM customer and Chinese OEMs;
|
o
|
factory capacity utilization in our Audio segment;
|
o
|
the pace and success of achieving the cost savings from our announced restructurings, acquisitions and operating expense reduction efforts;
|
o
|
fluctuations in our stock's market price;
|
o
|
fluctuations in operating results and cash flows;
|
o
|
our ability to prevent or identify quality issues in our products or to promptly remedy any such issues that are identified;
|
o
|
timing of OEM product launches;
|
o
|
customer purchasing behavior in light of current and anticipated mobile phone launches;
|
o
|
downward pressure on the average selling prices for our products;
|
o
|
macroeconomic conditions, both in the United States and internationally;
|
o
|
foreign currency exchange rate fluctuations;
|
o
|
our ability to achieve continued reductions in our operating expenses and maintain and improve quality and delivery for our customers;
|
o
|
our ability to qualify our products and facilities with customers;
|
o
|
risks and costs inherent in litigation;
|
o
|
our ability to obtain, enforce, defend or monetize our intellectual property rights;
|
o
|
increases in the costs of critical raw materials and components;
|
o
|
availability of raw materials and components;
|
o
|
the success and rate of multi-microphone adoption and our “intelligent audio” solutions;
|
o
|
managing rapid declines in customer demand for certain of our products or solutions, delays in customer product introductions and other related customer challenges;
|
o
|
our ability to successfully consummate acquisitions and divestitures, and our ability to integrate acquisitions following consummation;
|
o
|
our obligations and risks under various transaction agreements that were executed as part of our spin-off from our former parent company;
|
o
|
managing new product ramps and introductions for our customers;
|
o
|
our dependence on a limited number of large customers;
|
o
|
our ability to maintain and expand our existing relationships with leading OEMs and to establish relationships with new OEMs in order to maintain and increase our revenue;
|
o
|
business and competitive factors generally affecting the advanced micro-acoustic solutions and specialty components industry, our customers and our business;
|
o
|
fluctuations in demand by our telecom and other customers and telecom end markets;
|
o
|
our ability to enter new end user product markets;
|
o
|
increasing competition and new entrants in the market for our products;
|
o
|
our ability to develop new or enhanced products or technologies in a timely manner that achieve market acceptance;
|
o
|
our reliance on third parties to manufacture, assemble and test our products and sub-components; and
|
o
|
changes in tax laws or the loss of our tax holidays.
|
•
|
Audio Segment
|
•
|
Precision Devices ("PD") Segment
|
|
|
Three Months Ended March 31,
|
||||||
(in millions, except per share amounts)
|
|
2017
|
|
2016
|
||||
Revenues
|
|
$
|
193.7
|
|
|
$
|
185.3
|
|
|
|
|
|
|
||||
Gross profit
|
|
$
|
67.6
|
|
|
$
|
66.8
|
|
Non-GAAP gross profit
|
|
$
|
73.7
|
|
|
$
|
69.8
|
|
|
|
|
|
|
||||
Earnings (loss) from continuing operations before interest and income taxes
|
|
$
|
0.3
|
|
|
$
|
(6.4
|
)
|
Adjusted earnings from continuing operations before interest and income taxes
|
|
$
|
15.8
|
|
|
$
|
10.7
|
|
|
|
|
|
|
||||
(Benefit from) provision for income taxes
|
|
$
|
(0.2
|
)
|
|
$
|
2.4
|
|
Non-GAAP provision for (benefit from) income taxes
|
|
$
|
1.0
|
|
|
$
|
(0.5
|
)
|
|
|
|
|
|
||||
Loss from continuing operations
|
|
$
|
(4.7
|
)
|
|
$
|
(12.5
|
)
|
Non-GAAP net earnings
|
|
$
|
11.0
|
|
|
$
|
7.5
|
|
|
|
|
|
|
||||
Loss per share from continuing operations - diluted
|
|
$
|
(0.05
|
)
|
|
$
|
(0.14
|
)
|
Non-GAAP diluted earnings per share
|
|
$
|
0.12
|
|
|
$
|
0.08
|
|
|
|
Three Months Ended March 31,
|
||||||
(in millions, except share and per share amounts)
|
|
2017
|
|
2016
|
||||
Gross profit
|
|
$
|
67.6
|
|
|
$
|
66.8
|
|
Stock-based compensation expense
|
|
0.4
|
|
|
0.5
|
|
||
Restructuring charges
|
|
4.3
|
|
|
1.2
|
|
||
Production transfer costs
(2)
|
|
1.4
|
|
|
1.3
|
|
||
Non-GAAP gross profit
|
|
$
|
73.7
|
|
|
$
|
69.8
|
|
|
|
|
|
|
||||
Loss from continuing operations
|
|
$
|
(4.7
|
)
|
|
$
|
(12.5
|
)
|
Interest expense, net
|
|
5.2
|
|
|
3.7
|
|
||
(Benefit from) provision for income taxes
|
|
(0.2
|
)
|
|
2.4
|
|
||
Earnings (loss) from continuing operations before interest and income taxes
|
|
0.3
|
|
|
(6.4
|
)
|
||
Stock-based compensation expense
|
|
6.1
|
|
|
5.4
|
|
||
Intangibles amortization expense
|
|
3.0
|
|
|
5.6
|
|
||
Fixed asset and related inventory charges
|
|
—
|
|
|
0.1
|
|
||
Restructuring charges
|
|
5.0
|
|
|
4.7
|
|
||
Production transfer costs
(2)
|
|
1.4
|
|
|
1.3
|
|
||
Adjusted earnings from continuing operations before interest and income taxes
|
|
$
|
15.8
|
|
|
$
|
10.7
|
|
|
|
|
|
|
||||
Interest expense, net
|
|
$
|
5.2
|
|
|
$
|
3.7
|
|
Interest expense, net non-GAAP reconciling adjustments
(3)
|
|
1.4
|
|
|
—
|
|
||
Non-GAAP interest expense
|
|
$
|
3.8
|
|
|
$
|
3.7
|
|
|
|
|
|
|
||||
(Benefit from) provision for income taxes
|
|
$
|
(0.2
|
)
|
|
$
|
2.4
|
|
Income tax effects of non-GAAP reconciling adjustments
|
|
1.2
|
|
|
(2.9
|
)
|
||
Non-GAAP provision for (benefits from) income taxes
|
|
$
|
1.0
|
|
|
$
|
(0.5
|
)
|
|
|
|
|
|
||||
Loss from continuing operations
|
|
$
|
(4.7
|
)
|
|
$
|
(12.5
|
)
|
Non-GAAP reconciling adjustments
(4)
|
|
15.5
|
|
|
17.1
|
|
||
Interest expense, net non-GAAP reconciling adjustments
(3)
|
|
1.4
|
|
|
—
|
|
||
Income tax effects of non-GAAP reconciling adjustments
|
|
1.2
|
|
|
(2.9
|
)
|
||
Non-GAAP net earnings
|
|
$
|
11.0
|
|
|
$
|
7.5
|
|
|
|
|
|
|
||||
Diluted loss per share from continuing operations
|
|
$
|
(0.05
|
)
|
|
$
|
(0.14
|
)
|
Earnings per share non-GAAP reconciling adjustment
|
|
0.17
|
|
|
0.22
|
|
||
Non-GAAP diluted earnings per share
|
|
$
|
0.12
|
|
|
$
|
0.08
|
|
|
|
|
|
|
||||
Diluted average shares outstanding
|
|
88,973,503
|
|
|
88,536,740
|
|
||
Non-GAAP adjustment
(5)
|
|
3,177,224
|
|
|
1,489,027
|
|
||
Non-GAAP diluted average shares outstanding
(5)
|
|
92,150,727
|
|
|
90,025,767
|
|
|
|
Three Months Ended March 31,
|
||||||||||
(in millions)
|
|
2017
|
|
Percent of Revenues
|
|
2016
|
|
Percent of Revenues
|
||||
Revenues
|
|
$
|
144.2
|
|
|
|
|
$
|
137.9
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating earnings
|
|
$
|
9.9
|
|
|
6.9%
|
|
$
|
5.6
|
|
|
4.1%
|
Other (income) expense, net
|
|
1.0
|
|
|
|
|
(0.1
|
)
|
|
|
||
Earnings from continuing operations before interest and income taxes ("EBIT")
|
|
$
|
8.9
|
|
|
6.2%
|
|
$
|
5.7
|
|
|
4.1%
|
Stock-based compensation expense
|
|
2.7
|
|
|
|
|
2.4
|
|
|
|
||
Intangibles amortization expense
|
|
2.5
|
|
|
|
|
5.2
|
|
|
|
||
Fixed asset and related inventory charges
|
|
—
|
|
|
|
|
0.1
|
|
|
|
||
Restructuring charges
|
|
4.7
|
|
|
|
|
3.0
|
|
|
|
||
Production transfer costs
(1)
|
|
1.1
|
|
|
|
|
0.7
|
|
|
|
||
Other loss
|
|
—
|
|
|
|
|
0.1
|
|
|
|
||
Adjusted earnings from continuing operations before interest and income taxes ("Adjusted EBIT")
|
|
$
|
19.9
|
|
|
13.8%
|
|
$
|
17.2
|
|
|
12.5%
|
|
|
|
|
|
|
|
|
|
||||
(1)
Production transfer costs represent duplicate costs incurred to migrate manufacturing to new or existing facilities in Asia. These amounts are included in earnings before interest, income taxes and discontinued operations for each period presented.
|
|
|
Three Months Ended March 31,
|
||||||||||
(in millions)
|
|
2017
|
|
Percent of Revenues
|
|
2016
|
|
Percent of Revenues
|
||||
Revenues
|
|
$
|
49.5
|
|
|
|
|
$
|
47.4
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating earnings
|
|
$
|
5.6
|
|
|
11.3%
|
|
$
|
1.1
|
|
|
2.3%
|
Other (income) expense, net
|
|
0.1
|
|
|
|
|
(0.2
|
)
|
|
|
||
Earnings before interest and income taxes ("EBIT)
|
|
$
|
5.5
|
|
|
11.1%
|
|
$
|
1.3
|
|
|
2.7%
|
Stock-based compensation expense
|
|
0.2
|
|
|
|
|
0.3
|
|
|
|
||
Intangibles amortization expense
|
|
0.5
|
|
|
|
|
0.4
|
|
|
|
||
Restructuring charges
|
|
0.2
|
|
|
|
|
1.3
|
|
|
|
||
Production transfer costs
(1)
|
|
0.3
|
|
|
|
|
0.6
|
|
|
|
||
Adjusted earnings before interest and income taxes ("Adjusted EBIT")
|
|
$
|
6.7
|
|
|
13.5%
|
|
$
|
3.9
|
|
|
8.2%
|
|
||||||||||||
(1)
Production transfer costs represent duplicate costs incurred to migrate manufacturing to new or existing facilities. These amounts are included in earnings before interest and income taxes for each period presented.
|
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
|
2017
|
|
2016
|
||||
Net cash flows provided by (used in):
|
|
|
|
|
||||
Operating activities
|
|
$
|
17.9
|
|
|
$
|
19.8
|
|
Investing activities
|
|
(20.2
|
)
|
|
(9.1
|
)
|
||
Financing activities
|
|
(1.0
|
)
|
|
(29.8
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
|
0.4
|
|
|
—
|
|
||
Net decrease in cash and cash equivalents
|
|
$
|
(2.9
|
)
|
|
$
|
(19.1
|
)
|
(in millions)
|
|
March 31, 2017
|
|
December 31, 2016
|
||||
3.25% Convertible Senior Notes
|
|
$
|
136.7
|
|
|
$
|
135.1
|
|
Term loan and revolving credit facility
|
|
163.1
|
|
|
163.1
|
|
||
Total
|
|
299.8
|
|
|
298.2
|
|
||
Less: current maturities
|
|
13.2
|
|
|
9.7
|
|
||
Total long-term debt
|
|
$
|
286.6
|
|
|
$
|
288.5
|
|
|
|
|
|
|
|
|
|
101
|
The following financial information from Knowles Corporation's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2017 formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Statements of Earnings (Unaudited) for the three months ended March 31, 2017 and 2016, (ii) Consolidated Statements of Comprehensive Earnings (Unaudited) for the three months ended March 31, 2017 and 2016, (iii) Consolidated Balance Sheets as of March 31, 2017 (Unaudited) and December 31, 2016, (iv) Consolidated Statement of Stockholders’ Equity (Unaudited) for the three months ended March 31, 2017, (v) Consolidated Statements of Cash Flows (Unaudited) for the three months ended March 31, 2017 and 2016, and (vi) the Notes to the Consolidated Financial Statements (Unaudited)
|
|
|
KNOWLES CORPORATION
|
|
|
|
Date:
|
April 28, 2017
|
/s/ John S. Anderson
|
|
|
John S. Anderson
|
|
|
Senior Vice President & Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
|
|
|
|
|
|
|
|
101
|
The following financial information from Knowles Corporation's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2017 formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Statements of Earnings (Unaudited) for the three months ended March 31, 2017 and 2016, (ii) Consolidated Statements of Comprehensive Earnings (Unaudited) for the three months ended March 31, 2017 and 2016, (iii) Consolidated Balance Sheets as of March 31, 2017 (Unaudited) and December 31, 2016, (iv) Consolidated Statement of Stockholders’ Equity (Unaudited) for the three months ended March 31, 2017, (v) Consolidated Statements of Cash Flows (Unaudited) for the three months ended March 31, 2017 and 2016, and (vi) the Notes to the Consolidated Financial Statements (Unaudited)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Knowles Corporation;
|
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 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/ JEFFREY S. NIEW
|
|
|
Name: Jeffrey S. Niew
|
|
|
Title: President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Knowles Corporation;
|
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 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/ JOHN S. ANDERSON
|
|
|
Name: John S. Anderson
|
|
|
Title: Senior Vice President & Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
|
|
/s/ JEFFREY S. NIEW
|
|
|
Name: Jeffrey S. Niew
|
|
|
Title: President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
|
|
Date: April 28, 2017
|
|
|
|
|
|
/s/ JOHN S. ANDERSON
|
|
|
Name: John S. Anderson
|
|
|
Title: Senior Vice President & Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
|
|
Date: April 28, 2017
|