(Mark One)
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x
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Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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For the Quarterly Period Ended June 30, 2015
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or
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o
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Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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For the Transition Period from
to
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Delaware
(State or other jurisdiction of
incorporation or organization)
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47-3574483
(IRS Employer
Identification No.)
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Large accelerated filer
o
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Accelerated filer
o
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Non-accelerated filer
x
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Smaller reporting company
o
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(Do not check if a
smaller reporting company)
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June 30,
2015 |
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December 31,
2014 |
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Assets
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Current assets:
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Cash and cash equivalents
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$
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17,050
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$
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5,720
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Receivables, net of reserves of approximately $2.8 million and $3.2 million as of June 30, 2015 and December 31, 2014, respectively
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92,750
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63,840
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Inventories
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125,750
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123,530
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Deferred income taxes
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4,840
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4,840
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Prepaid expenses and other current assets
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6,520
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5,690
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Total current assets
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246,910
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203,620
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Property and equipment, net
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48,870
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55,180
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Goodwill
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5,630
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6,580
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Other intangibles, net
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61,400
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66,510
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Other assets
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12,890
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11,940
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Total assets
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$
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375,700
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$
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343,830
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Liabilities and Shareholders' Equity
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Current liabilities:
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Current maturities, long-term debt
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$
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17,940
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$
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460
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Accounts payable
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81,830
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81,980
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Accrued liabilities
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44,380
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37,940
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Total current liabilities
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144,150
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120,380
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Long-term debt
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192,430
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300
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Deferred income taxes
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9,220
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8,970
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Other long-term liabilities
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27,900
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25,990
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Total liabilities
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373,700
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155,640
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Commitments and contingent liabilities
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—
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—
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Preferred stock, $0.01 par: Authorized 100,000,000 shares;
Issued and outstanding: None |
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—
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—
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Common stock, $0.01 par: Authorized 400,000,000 shares;
Issued and outstanding: 18,062,027 shares at June 30, 2015 and no shares at December 31, 2014 |
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180
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—
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Parent company investment
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—
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180,800
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Accumulated deficit
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(6,530
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)
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—
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Accumulated other comprehensive income
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8,350
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7,390
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Total shareholders' equity
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2,000
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188,190
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Total liabilities and shareholders' equity
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$
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375,700
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$
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343,830
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Three months ended
June 30, |
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Six months ended
June 30, |
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2015
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2014
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2015
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2014
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Net sales
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$
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158,540
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$
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178,260
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$
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300,900
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$
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326,350
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Cost of sales
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(120,790
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(131,600
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(227,850
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(244,030
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)
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Gross profit
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37,750
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46,660
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73,050
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82,320
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Selling, general and administrative expenses
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(30,550
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(31,610
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(62,190
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(63,020
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Net loss on dispositions of property and equipment
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(1,840
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(60
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(1,790
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(70
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Operating profit
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5,360
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14,990
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9,070
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19,230
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Other expense, net:
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Interest expense
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(120
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(170
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(240
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(360
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Other expense, net
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(720
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(720
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(1,970
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(1,480
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Other expense, net
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(840
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(890
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(2,210
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(1,840
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Income before income tax expense
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4,520
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14,100
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6,860
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17,390
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Income tax expense
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(2,320
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(3,280
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(3,180
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(4,190
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Net income
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$
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2,200
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$
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10,820
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$
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3,680
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$
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13,200
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Net income per share:
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Basic
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$
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0.12
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$
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0.60
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$
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0.20
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$
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0.73
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Diluted
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$
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0.12
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$
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0.60
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$
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0.20
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$
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0.73
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Weighted average common shares outstanding:
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Basic
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18,062,027
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18,062,027
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18,062,027
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18,062,027
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Diluted
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18,134,475
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18,113,080
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18,134,475
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18,113,080
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Three months ended
June 30, |
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Six months ended
June 30, |
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2015
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2014
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2015
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2014
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Net income
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$
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2,200
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$
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10,820
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$
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3,680
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$
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13,200
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Other comprehensive income (net of tax):
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Foreign currency translation
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1,150
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1,110
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(4,090
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)
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2,950
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Derivative instruments (Note 8)
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(280
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)
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(60
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(180
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)
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270
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Total other comprehensive income
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870
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1,050
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(4,270
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)
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3,220
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Total comprehensive income
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$
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3,070
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$
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11,870
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$
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(590
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)
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$
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16,420
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Six months ended
June 30, |
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2015
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2014
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Cash Flows from Operating Activities:
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Net income
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$
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3,680
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$
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13,200
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Adjustments to reconcile net income to net cash used for operating activities:
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Loss on dispositions of property and equipment
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1,790
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70
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Depreciation
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5,080
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5,930
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Amortization of intangible assets
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3,720
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3,810
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Deferred income taxes
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980
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510
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Non-cash compensation expense
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1,270
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1,570
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Increase in receivables
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(31,110
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)
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(41,830
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)
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(Increase) decrease in inventories
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(4,140
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)
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11,610
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Increase in prepaid expenses and other assets
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(1,630
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)
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(110
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)
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Increase (decrease) in accounts payable and accrued liabilities
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12,800
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(13,430
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)
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Other, net
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670
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420
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Net cash used for operating activities
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(6,890
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)
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(18,250
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)
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Cash Flows from Investing Activities:
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Capital expenditures
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(4,140
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)
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(7,550
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)
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Net proceeds from disposition of property and equipment
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1,470
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|
200
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Net cash used for investing activities
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(2,670
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)
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(7,350
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)
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Cash Flows from Financing Activities:
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Proceeds from borrowings on credit facilities
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73,100
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89,730
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Repayments of borrowings on credit facilities
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(65,410
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)
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(86,610
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)
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Proceeds from Term B Loan, net of issuance costs
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192,970
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|
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—
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Proceeds from ABL Revolving Debt, net of issuance costs
|
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7,720
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—
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Net transfers from former parent
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27,630
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25,660
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Cash dividend paid to former parent
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(214,500
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)
|
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—
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Net cash provided by financing activities
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21,510
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28,780
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Effect of exchange rate changes on cash
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(620
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)
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300
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Cash and Cash Equivalents:
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Increase for the period
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11,330
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3,480
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At beginning of period
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5,720
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7,880
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At end of period
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$
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17,050
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$
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11,360
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Supplemental disclosure of cash flow information:
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Cash paid for interest
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$
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220
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$
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310
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Common
Stock
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Parent Company Investment
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Accumulated
Deficit
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Accumulated
Other
Comprehensive
Income
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Total
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Balances, December 31, 2014
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$
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—
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$
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180,800
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$
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—
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$
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7,390
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$
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188,190
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Net income
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—
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3,680
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—
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—
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3,680
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Other comprehensive income
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—
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—
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—
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(4,270
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)
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(4,270
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)
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Issuance of common stock
|
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180
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(180
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)
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—
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—
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—
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Net transfers from former parent
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—
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23,670
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—
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5,230
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28,900
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Cash dividend paid to former parent
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—
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(214,500
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)
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—
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—
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(214,500
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)
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Reclassification of net parent investment to accumulated deficit
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—
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6,530
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(6,530
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)
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—
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—
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Balances, June 30, 2015
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$
|
180
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|
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$
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—
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$
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(6,530
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)
|
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$
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8,350
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$
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2,000
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Cequent Americas
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Cequent APEA
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Total
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(dollars in thousands)
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Balance, December 31, 2014
|
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$
|
6,580
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$
|
—
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$
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6,580
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Foreign currency translation and other
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(950
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)
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—
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(950
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)
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Balance, June 30, 2015
|
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$
|
5,630
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$
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—
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$
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5,630
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As of June 30, 2015
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As of December 31, 2014
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Intangible Category by Useful Life
|
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Gross Carrying Amount
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Accumulated Amortization
|
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Gross Carrying Amount
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Accumulated Amortization
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(dollars in thousands)
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Finite-lived intangible assets:
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Customer relationships, 5 – 12 years
|
|
$
|
33,400
|
|
|
$
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(26,560
|
)
|
|
$
|
34,170
|
|
|
$
|
(26,190
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)
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Customer relationships, 15 – 25 years
|
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105,380
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|
|
(75,220
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)
|
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105,380
|
|
|
(72,250
|
)
|
||||
Total customer relationships
|
|
138,780
|
|
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(101,780
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)
|
|
139,550
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|
|
(98,440
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)
|
||||
Technology and other, 3 – 15 years
|
|
14,560
|
|
|
(14,030
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)
|
|
14,600
|
|
|
(13,910
|
)
|
||||
Total finite-lived intangible assets
|
|
153,340
|
|
|
(115,810
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)
|
|
154,150
|
|
|
(112,350
|
)
|
||||
Trademark/Trade names, indefinite-lived
|
|
23,870
|
|
|
—
|
|
|
24,710
|
|
|
—
|
|
||||
Total other intangible assets
|
|
$
|
177,210
|
|
|
$
|
(115,810
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)
|
|
$
|
178,860
|
|
|
$
|
(112,350
|
)
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
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(dollars in thousands)
|
||||||||||||||
Technology and other, included in cost of sales
|
|
$
|
60
|
|
|
$
|
40
|
|
|
$
|
120
|
|
|
$
|
130
|
|
Customer relationships, included in selling, general and administrative expenses
|
|
1,790
|
|
|
1,860
|
|
|
3,600
|
|
|
3,680
|
|
||||
Total amortization expense
|
|
$
|
1,850
|
|
|
$
|
1,900
|
|
|
$
|
3,720
|
|
|
$
|
3,810
|
|
|
|
June 30,
2015 |
|
December 31,
2014 |
||||
|
|
(dollars in thousands)
|
||||||
Finished goods
|
|
$
|
94,240
|
|
|
$
|
89,550
|
|
Work in process
|
|
5,710
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|
|
6,810
|
|
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Raw materials
|
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25,800
|
|
|
27,170
|
|
||
Total inventories
|
|
$
|
125,750
|
|
|
$
|
123,530
|
|
|
|
June 30,
2015 |
|
December 31,
2014 |
||||
|
|
(dollars in thousands)
|
||||||
Land and land improvements
|
|
$
|
110
|
|
|
$
|
290
|
|
Buildings
|
|
8,340
|
|
|
9,250
|
|
||
Machinery and equipment
|
|
99,410
|
|
|
118,460
|
|
||
|
|
107,860
|
|
|
128,000
|
|
||
Less: Accumulated depreciation
|
|
58,990
|
|
|
72,820
|
|
||
Property and equipment, net
|
|
$
|
48,870
|
|
|
$
|
55,180
|
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(dollars in thousands)
|
||||||||||||||
Depreciation expense, included in cost of sales
|
|
$
|
2,110
|
|
|
$
|
2,530
|
|
|
$
|
4,260
|
|
|
$
|
4,900
|
|
Depreciation expense, included in selling, general and administrative expense
|
|
430
|
|
|
530
|
|
|
820
|
|
|
1,030
|
|
||||
Total depreciation expense
|
|
$
|
2,540
|
|
|
$
|
3,060
|
|
|
$
|
5,080
|
|
|
$
|
5,930
|
|
|
|
June 30,
2015 |
|
December 31,
2014 |
||||
|
|
(dollars in thousands)
|
||||||
ABL Facility
|
|
$
|
9,290
|
|
|
$
|
—
|
|
Term B Loan
|
|
192,970
|
|
|
—
|
|
||
Bank facilities
|
|
7,710
|
|
|
140
|
|
||
Capital leases and other long-term debt
|
|
400
|
|
|
620
|
|
||
|
|
210,370
|
|
|
760
|
|
||
Less: Current maturities, long-term debt
|
|
17,940
|
|
|
460
|
|
||
Long-term debt
|
|
$
|
192,430
|
|
|
$
|
300
|
|
|
|
|
|
Asset / (Liability) Derivatives
|
||||||
|
|
Balance Sheet Caption
|
|
June 30,
2015 |
|
December 31,
2014 |
||||
|
|
|
|
(dollars in thousands)
|
||||||
Derivatives designated as hedging instruments
|
|
|
|
|
|
|
||||
Foreign currency forward contracts
|
|
Other assets
|
|
$
|
10
|
|
|
$
|
—
|
|
Foreign currency forward contracts
|
|
Accrued liabilities
|
|
(260
|
)
|
|
(150
|
)
|
||
Total derivatives designated as hedging instruments
|
|
|
|
(250
|
)
|
|
(150
|
)
|
||
Derivatives not designated as hedging instruments
|
|
|
|
|
|
|
||||
Foreign currency forward contracts
|
|
Accrued liabilities
|
|
(70
|
)
|
|
—
|
|
||
Total derivatives not designated as hedging instruments
|
|
|
|
(70
|
)
|
|
—
|
|
||
Total derivatives
|
|
|
|
$
|
(320
|
)
|
|
$
|
(150
|
)
|
|
Amount of Loss Recognized in
AOCI on Derivative (Effective Portion, net of tax) |
|
|
|
Amount of Income (Loss) Reclassified
from AOCI into Earnings |
||||||||||||||||||||
|
|
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
|||||||||||||||||||
|
As of
June 30, 2015
|
|
As of December 31, 2014
|
|
Location of Income (Loss) Reclassified from AOCI into Earnings (Effective Portion)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||||||
|
(dollars in thousands)
|
|
|
|
(dollars in thousands)
|
||||||||||||||||||||
Derivatives instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency forward contracts
|
$
|
(250
|
)
|
|
$
|
(70
|
)
|
|
Cost of sales
|
|
$
|
(260
|
)
|
|
$
|
170
|
|
|
$
|
(450
|
)
|
|
$
|
220
|
|
|
|
Frequency
|
|
Asset / (Liability)
|
|
Quoted Prices in Active Markets for Identical Assets
(Level 1) |
|
Significant Other Observable Inputs
(Level 2) |
|
Significant Unobservable Inputs
(Level 3) |
||||||||
|
|
|
|
(dollars in thousands)
|
||||||||||||||
June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency forward contracts
|
|
Recurring
|
|
$
|
(320
|
)
|
|
$
|
—
|
|
|
$
|
(320
|
)
|
|
$
|
—
|
|
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency forward contracts
|
|
Recurring
|
|
$
|
(150
|
)
|
|
$
|
—
|
|
|
$
|
(150
|
)
|
|
$
|
—
|
|
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(dollars in thousands)
|
||||||||||||||
Net Sales
|
|
|
|
|
|
|
|
|
||||||||
Cequent Americas
|
|
$
|
118,950
|
|
|
$
|
134,460
|
|
|
$
|
225,490
|
|
|
$
|
243,080
|
|
Cequent APEA
|
|
39,590
|
|
|
43,800
|
|
|
75,410
|
|
|
83,270
|
|
||||
Total
|
|
$
|
158,540
|
|
|
$
|
178,260
|
|
|
$
|
300,900
|
|
|
$
|
326,350
|
|
Operating Profit (Loss)
|
|
|
|
|
|
|
|
|
||||||||
Cequent Americas
|
|
$
|
7,780
|
|
|
$
|
16,790
|
|
|
$
|
13,700
|
|
|
$
|
22,550
|
|
Cequent APEA
|
|
1,670
|
|
|
2,170
|
|
|
3,920
|
|
|
4,630
|
|
||||
Corporate expenses
|
|
(4,090
|
)
|
|
(3,970
|
)
|
|
(8,550
|
)
|
|
(7,950
|
)
|
||||
Total
|
|
$
|
5,360
|
|
|
$
|
14,990
|
|
|
$
|
9,070
|
|
|
$
|
19,230
|
|
|
|
Number of Unvested Restricted Shares
|
|
Weighted Average Grant Date Fair Value
|
|
Average Remaining Contractual Life (Years)
|
|
Aggregate Intrinsic Value
|
|||||
Outstanding at June 30, 2015
|
|
229,046
|
|
|
$
|
16.05
|
|
|
1.2
|
|
$
|
3,550,213
|
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(dollars in thousands, except for per share amounts)
|
||||||||||||||
Numerator:
|
|
|
|
|
|
|
|
|
||||||||
Net income for basic and diluted earnings per share
|
|
$
|
2,200
|
|
|
$
|
10,820
|
|
|
$
|
3,680
|
|
|
$
|
13,200
|
|
Denominator:
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding, basic
|
|
18,062,027
|
|
|
18,062,027
|
|
|
18,062,027
|
|
|
18,062,027
|
|
||||
Dilutive effect of stock-based awards
|
|
72,448
|
|
|
51,053
|
|
|
72,448
|
|
|
51,053
|
|
||||
Weighted average shares outstanding, diluted
|
|
18,134,475
|
|
|
18,113,080
|
|
|
18,134,475
|
|
|
18,113,080
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share
|
|
$
|
0.12
|
|
|
$
|
0.60
|
|
|
$
|
0.20
|
|
|
$
|
0.73
|
|
Diluted earnings per share
|
|
$
|
0.12
|
|
|
$
|
0.60
|
|
|
$
|
0.20
|
|
|
$
|
0.73
|
|
|
|
Derivative Instruments
|
|
Foreign Currency Translation
|
|
Total
|
||||||
|
|
(dollars in thousands)
|
||||||||||
Balance, December 31, 2014
|
|
$
|
(70
|
)
|
|
$
|
7,460
|
|
|
$
|
7,390
|
|
Net transfer from former parent
|
|
—
|
|
|
5,230
|
|
|
5,230
|
|
|||
Net unrealized gains (losses) arising during the period
(a)
|
|
(610
|
)
|
|
(4,090
|
)
|
|
(4,700
|
)
|
|||
Less: Net realized (losses) reclassified to net income
(b)
|
|
(430
|
)
|
|
—
|
|
|
(430
|
)
|
|||
Net current-period change
|
|
(180
|
)
|
|
1,140
|
|
|
960
|
|
|||
Balance, June 30, 2015
|
|
$
|
(250
|
)
|
|
$
|
8,600
|
|
|
$
|
8,350
|
|
|
|
Derivative Instruments
|
|
Foreign Currency Translation
|
|
Total
|
||||||
|
|
(dollars in thousands)
|
||||||||||
Balance, December 31, 2013
|
|
$
|
—
|
|
|
$
|
14,700
|
|
|
$
|
14,700
|
|
Net unrealized gains arising during the period
(a)
|
|
490
|
|
|
2,950
|
|
|
3,440
|
|
|||
Less: Net realized gains reclassified to net income
(b)
|
|
220
|
|
|
—
|
|
|
220
|
|
|||
Net current-period change
|
|
270
|
|
|
2,950
|
|
|
3,220
|
|
|||
Balance, June 30, 2014
|
|
$
|
270
|
|
|
$
|
17,650
|
|
|
$
|
17,920
|
|
•
|
Closed and moved production from our former Goshen, Indiana manufacturing facility to a new lower-cost facility in Reynosa, Mexico in 2013, relocating approximately 420 positions;
|
•
|
Relocated the supply chain from the Midwestern United States to localized supply near Reynosa;
|
•
|
As a result of the Goshen manufacturing move, relocated the main U.S. distribution facility from Huntington, Indiana to Dallas, Texas;
|
•
|
Closed and consolidated two former facilities in Australia into one newer facility; and
|
•
|
Closed and consolidated two former facilities in Brazil into one facility.
|
|
|
Three months ended June 30,
|
||||||||||||
|
|
2015
|
|
As a Percentage
of Net Sales
|
|
2014
|
|
As a Percentage
of Net Sales
|
||||||
|
|
(dollars in thousands)
|
||||||||||||
Net Sales
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
118,950
|
|
|
75.0
|
%
|
|
$
|
134,460
|
|
|
75.4
|
%
|
Cequent APEA
|
|
39,590
|
|
|
25.0
|
%
|
|
43,800
|
|
|
24.6
|
%
|
||
Total
|
|
$
|
158,540
|
|
|
100.0
|
%
|
|
$
|
178,260
|
|
|
100.0
|
%
|
Gross Profit
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
31,250
|
|
|
26.3
|
%
|
|
$
|
38,480
|
|
|
28.6
|
%
|
Cequent APEA
|
|
6,500
|
|
|
16.4
|
%
|
|
8,180
|
|
|
18.7
|
%
|
||
Total
|
|
$
|
37,750
|
|
|
23.8
|
%
|
|
$
|
46,660
|
|
|
26.2
|
%
|
Selling, General and Administrative Expenses
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
21,680
|
|
|
18.2
|
%
|
|
$
|
21,640
|
|
|
16.1
|
%
|
Cequent APEA
|
|
4,780
|
|
|
12.1
|
%
|
|
6,000
|
|
|
13.7
|
%
|
||
Corporate expenses
|
|
4,090
|
|
|
N/A
|
|
|
3,970
|
|
|
N/A
|
|
||
Total
|
|
$
|
30,550
|
|
|
19.3
|
%
|
|
$
|
31,610
|
|
|
17.7
|
%
|
Net Loss on Disposition of Property and Equipment
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
(1,780
|
)
|
|
1.5
|
%
|
|
$
|
(60
|
)
|
|
—
|
%
|
Cequent APEA
|
|
(60
|
)
|
|
0.2
|
%
|
|
—
|
|
|
—
|
%
|
||
Total
|
|
$
|
(1,840
|
)
|
|
1.2
|
%
|
|
$
|
(60
|
)
|
|
—
|
%
|
Operating Profit (Loss)
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
7,780
|
|
|
6.5
|
%
|
|
$
|
16,790
|
|
|
12.5
|
%
|
Cequent APEA
|
|
1,670
|
|
|
4.2
|
%
|
|
2,170
|
|
|
5.0
|
%
|
||
Corporate expenses
|
|
(4,090
|
)
|
|
N/A
|
|
|
(3,970
|
)
|
|
N/A
|
|
||
Total
|
|
$
|
5,360
|
|
|
3.4
|
%
|
|
$
|
14,990
|
|
|
8.4
|
%
|
Depreciation and Amortization
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
2,720
|
|
|
2.3
|
%
|
|
$
|
3,000
|
|
|
2.2
|
%
|
Cequent APEA
|
|
1,650
|
|
|
4.2
|
%
|
|
1,960
|
|
|
4.5
|
%
|
||
Corporate expenses
|
|
20
|
|
|
N/A
|
|
|
—
|
|
|
N/A
|
|
||
Total
|
|
$
|
4,390
|
|
|
2.8
|
%
|
|
$
|
4,960
|
|
|
2.8
|
%
|
|
|
Six months ended June 30,
|
||||||||||||
|
|
2015
|
|
As a Percentage
of Net Sales |
|
2014
|
|
As a Percentage
of Net Sales |
||||||
|
|
(dollars in thousands)
|
||||||||||||
Net Sales
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
225,490
|
|
|
74.9
|
%
|
|
$
|
243,080
|
|
|
74.5
|
%
|
Cequent APEA
|
|
75,410
|
|
|
25.1
|
%
|
|
83,270
|
|
|
25.5
|
%
|
||
Total
|
|
$
|
300,900
|
|
|
100.0
|
%
|
|
$
|
326,350
|
|
|
100.0
|
%
|
Gross Profit
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
59,380
|
|
|
26.3
|
%
|
|
$
|
66,150
|
|
|
27.2
|
%
|
Cequent APEA
|
|
13,670
|
|
|
18.1
|
%
|
|
16,170
|
|
|
19.4
|
%
|
||
Total
|
|
$
|
73,050
|
|
|
24.3
|
%
|
|
$
|
82,320
|
|
|
25.2
|
%
|
Selling, General and Administrative Expenses
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
43,940
|
|
|
19.5
|
%
|
|
$
|
43,540
|
|
|
17.9
|
%
|
Cequent APEA
|
|
9,700
|
|
|
12.9
|
%
|
|
11,530
|
|
|
13.8
|
%
|
||
Corporate expenses
|
|
8,550
|
|
|
N/A
|
|
|
7,950
|
|
|
N/A
|
|
||
Total
|
|
$
|
62,190
|
|
|
20.7
|
%
|
|
$
|
63,020
|
|
|
19.3
|
%
|
Net Loss on Disposition of Property and Equipment
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
(1,730
|
)
|
|
0.8
|
%
|
|
$
|
(70
|
)
|
|
—
|
%
|
Cequent APEA
|
|
(60
|
)
|
|
0.1
|
%
|
|
—
|
|
|
—
|
%
|
||
Total
|
|
$
|
(1,790
|
)
|
|
0.6
|
%
|
|
$
|
(70
|
)
|
|
—
|
%
|
Operating Profit (Loss)
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
13,700
|
|
|
6.1
|
%
|
|
$
|
22,550
|
|
|
9.3
|
%
|
Cequent APEA
|
|
3,920
|
|
|
5.2
|
%
|
|
4,630
|
|
|
5.6
|
%
|
||
Corporate expenses
|
|
(8,550
|
)
|
|
N/A
|
|
|
(7,950
|
)
|
|
N/A
|
|
||
Total
|
|
$
|
9,070
|
|
|
3.0
|
%
|
|
$
|
19,230
|
|
|
5.9
|
%
|
Depreciation and Amortization
|
|
|
|
|
|
|
|
|
||||||
Cequent Americas
|
|
$
|
5,470
|
|
|
2.4
|
%
|
|
$
|
5,940
|
|
|
2.4
|
%
|
Cequent APEA
|
|
3,310
|
|
|
4.4
|
%
|
|
3,800
|
|
|
4.6
|
%
|
||
Corporate expenses
|
|
20
|
|
|
N/A
|
|
|
—
|
|
|
N/A
|
|
||
Total
|
|
$
|
8,800
|
|
|
2.9
|
%
|
|
$
|
9,740
|
|
|
3.0
|
%
|
▪
|
our spin-off from TriMas Corporation, or TriMas, on June 30, 2015, through the distribution of 100 percent of the outstanding common shares of Horizon;
|
▪
|
our new credit agreement, or Credit Agreement, which provides for a revolving credit facility, or ABL Facility, as well as a term loan facility under which the Company borrowed an aggregate of $200 million;
|
▪
|
the impact of foreign currency, as our reported result in U.S. dollars were negatively impacted as a result of the stronger U.S. dollar relative to foreign currencies, particularly in our Cequent APEA reportable segment; and
|
▪
|
market dynamics surrounding distribution customer consolidation and the discontinuance of certain promotional incentives.
|
•
|
For the
six months ended June 30, 2015
, we generated
$17.2 million
of cash, based on the reported net income of
$3.7 million
and after considering the effects of non-cash items related to losses on dispositions of property and equipment, depreciation, amortization, stock-based compensation, changes in deferred income taxes, and other, net. For the
six months ended June 30, 2014
, we generated
$25.5 million
in cash flows based on the reported net income of
$13.2 million
and after considering the effects of similar non-cash items.
|
•
|
Increases in accounts receivable resulted in a use of cash of approximately
$31.1 million
and
$41.8 million
for the
six months ended June 30, 2015
and
2014
, respectively. The increases in accounts receivable for the six months ended June 30, 2015 and 2014 is a result of higher sales activity in the second quarter compared to the fourth quarter. The decrease in cash used from accounts receivable for the six months ended June 30, 2015 is due to the timing of sales activity, as days sales outstanding remained relatively consistent at 53 days at June 30, 2015 compared to 55 days at June 30, 2014.
|
•
|
For the
six months ended June 30, 2015
, we used approximately
$4.1 million
for investment in our inventories. Inventory levels increased primarily to support our increased sales volumes as compared to year end. For the
six months ended June 30, 2014
, we reduced our investment in inventory, which resulted in a cash source of
$11.6 million
, primarily as a result of the reduction in inventory levels in our Cequent Americas reportable segment as the safety stock levels built in preparation for the move from our Goshen, Indiana manufacturing facility to lower cost country facilities were consumed and replenished at lower levels.
|
•
|
Accounts payable and accrued liabilities increased during the
six months ended June 30, 2015
, providing approximately
$12.8 million
of cash, compared to a decrease during the
six months ended June 30, 2014
which resulted in the use of approximately
$13.4 million
of cash. During the six months ended June 30, 2015 accrued liabilities increased primarily due to a $9.6 million payable to our former parent in accordance with a tax sharing agreement entered into as part of the spin-off transaction. The remaining change in cash provided by and used for accounts payable and accrued liabilities is primarily a result of the timing of payments made to suppliers and mix of vendors and related terms. Our days accounts payable on hand increased from approximately 53 days for the
six months ended June 30, 2014
to approximately 62 days for the
six months ended June 30, 2015
.
|
|
|
|
|
Less:
|
|
Add:
|
|
|
||||||||
|
|
Year Ended December 31, 2014
|
|
Six Months Ended June 30, 2014
|
|
Six Months Ended June 30, 2015
|
|
Twelve Months Ended June 30, 2015
|
||||||||
|
|
(dollars in thousands)
|
||||||||||||||
Net income
|
|
$
|
15,350
|
|
|
$
|
13,200
|
|
|
$
|
3,680
|
|
|
$
|
5,830
|
|
Bank stipulated adjustments:
|
|
|
|
|
|
|
|
|
||||||||
Interest expense, net
|
|
720
|
|
|
360
|
|
|
240
|
|
|
600
|
|
||||
Income tax expense
|
|
5,240
|
|
|
4,190
|
|
|
3,180
|
|
|
4,230
|
|
||||
Depreciation and amortization
|
|
18,930
|
|
|
9,740
|
|
|
8,800
|
|
|
17,990
|
|
||||
Non-cash compensation expense
(1)
|
|
2,660
|
|
|
1,570
|
|
|
1,270
|
|
|
2,360
|
|
||||
Other non-cash expenses or losses
|
|
15,260
|
|
|
8,620
|
|
|
10,930
|
|
|
17,570
|
|
||||
Non-recurring expenses or costs
(2)
|
|
4,440
|
|
|
2,440
|
|
|
3,530
|
|
|
5,530
|
|
||||
Acquisition integration costs
(3)
|
|
90
|
|
|
60
|
|
|
—
|
|
|
30
|
|
||||
Interest-equivalent costs associated with any Specified Vendor Receivables Financing
|
|
870
|
|
|
320
|
|
|
330
|
|
|
880
|
|
||||
Consolidated Bank EBITDA, as defined
|
|
$
|
63,560
|
|
|
$
|
40,500
|
|
|
$
|
31,960
|
|
|
$
|
55,020
|
|
|
|
June 30, 2015
|
|
||
|
|
(dollars in thousands)
|
|
||
Total Consolidated Indebtedness
|
|
$
|
210,370
|
|
|
Consolidated Bank EBITDA, as defined
|
|
55,020
|
|
|
|
Actual leverage ratio
|
|
3.82
|
|
x
|
|
Covenant requirement
|
|
5.25
|
|
x
|
(1)
|
Non-cash compensation expenses resulting from the grant of restricted shares of common stock and common stock options. Amounts allocated by former parent company.
|
(2)
|
Non-recurring costs and expenses relating to cost savings projects, including restructuring and severance expenses, not to exceed $5.0 million in any fiscal year and $15 million in aggregate, commencing on or after January 1, 2015.
|
(3)
|
Costs and expenses arising from the integration of any business acquired not to exceed $7.5 million in any fiscal year $20.0 million in the aggregate.
|
•
|
An emerging growth company is exempt from any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and financial statements, commonly known as an “auditor discussion and analysis.”
|
•
|
An emerging growth company is not required to hold a nonbinding advisory stockholder vote on executive compensation or any golden parachute payments not previously approved by stockholders.
|
•
|
An emerging growth company is not required to comply with the requirement of auditor attestation of management’s assessment of internal control over financial reporting, which is required for other public reporting companies by Section 404 of the Sarbanes-Oxley Act.
|
•
|
An emerging growth company is eligible for reduced disclosure obligations regarding executive compensation in its periodic and annual reports, including without limitation exemption from the requirement to provide a compensation discussion and analysis describing compensation practices and procedures.
|
•
|
A company that is an emerging growth company is eligible for reduced financial statement disclosure in registration statements, which must include two years of audited financial statements rather than the three years of audited financial statements that are required for other public reporting companies.
|
2.1(b)*
|
Separation and Distribution Agreement, dated as of June 30, 2015, by and between Horizon Global Corporation and TriMas Corporation.
|
3.1
|
Amended and Restated Certificate of Incorporation of Horizon Global Corporation.
|
3.2(a)
|
Amended and Restated By-laws of Horizon Global Corporation.
|
10.1(b)
|
Tax Sharing Agreement, dated as of June 30, 2015, by and between Horizon Global Corporation and TriMas Corporation.
|
10.2(b)
|
Employee Matters Agreement, dated as of June 30, 2015, by and between Horizon Global Corporation and TriMas Corporation.
|
10.3(b)
|
Transition Services Agreement, dated as of June 30, 2015, by and between Horizon Global Corporation and TriMas Corporation.
|
10.4(b)
|
Noncompetition and Nonsolicitation Agreement, dated as of June 30, 2015, by and between Horizon Global Corporation and TriMas Corporation.
|
10.5(b)
|
Loan Agreement, dated as of June 30, 2015, among the Company, Cequent Performance Products, Inc., Cequent Consumer Products, Inc., the lenders party thereto and Bank of America, N.A., as agent for the lenders.
|
10.6(b)
|
Term Credit Agreement, dated as of June 30, 2015, among the Company, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative and collateral agent.
|
10.7
|
Horizon Global Corporation Executive Retirement Plan effective as of July 1, 2015.
|
10.8(a)
|
Form of Indemnification Agreement.
|
10.9(a)
|
Horizon Global Corporation 2015 Equity and Incentive Compensation Plan.
|
31.1
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31.2
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32.1
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
32.2
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS
|
XBRL Instance Document.
|
101.SCH
|
XBRL Taxonomy Extension Schema Document.
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document.
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
(a)
|
|
Incorporated by reference to the Exhibits filed with our S-1/A Registration Statement filed on June 11, 2015 (Reg. No. 333-203138).
|
(b)
|
|
Incorporated by reference to the Exhibits filed with our Current Report on Form 8-K filed on July 6, 2015 (File No. 001-37427).
|
|
|
|
* Certain exhibits and schedules were omitted in the original filing and the Company agrees to furnish supplementally to the Securities and Exchange Commission a copy of any omitted exhibits and schedules upon request.
|
|
|
HORIZON GLOBAL CORPORATION (Registrant)
|
||
|
|
|
|
|
|
|
|
|
/s/ DAVID G. RICE
|
|
|
|
|
|
Date:
|
August 11, 2015
|
By:
|
|
David G. Rice
Chief Financial Officer
|
2.1(b)*
|
Separation and Distribution Agreement, dated as of June 30, 2015, by and between Horizon Global Corporation and TriMas Corporation.
|
3.1
|
Amended and Restated Certificate of Incorporation of Horizon Global Corporation.
|
3.2(a)
|
Amended and Restated By-laws of Horizon Global Corporation.
|
10.1(b)
|
Tax Sharing Agreement, dated as of June 30, 2015, by and between Horizon Global Corporation and TriMas Corporation.
|
10.2(b)
|
Employee Matters Agreement, dated as of June 30, 2015, by and between Horizon Global Corporation and TriMas Corporation.
|
10.3(b)
|
Transition Services Agreement, dated as of June 30, 2015, by and between Horizon Global Corporation and TriMas Corporation.
|
10.4(b)
|
Noncompetition and Nonsolicitation Agreement, dated as of June 30, 2015, by and between Horizon Global Corporation and TriMas Corporation.
|
10.5(b)
|
Loan Agreement, dated as of June 30, 2015, among the Company, Cequent Performance Products, Inc., Cequent Consumer Products, Inc., the lenders party thereto and Bank of America, N.A., as agent for the lenders.
|
10.6(b)
|
Term Credit Agreement, dated as of June 30, 2015, among the Company, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative and collateral agent.
|
10.7
|
Horizon Global Corporation Executive Retirement Plan effective as of July 1, 2015.
|
10.8(a)
|
Form of Indemnification Agreement.
|
10.9(a)
|
Horizon Global Corporation 2015 Equity and Incentive Compensation Plan.
|
31.1
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31.2
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32.1
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
32.2
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS
|
XBRL Instance Document.
|
101.SCH
|
XBRL Taxonomy Extension Schema Document.
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document.
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
(a)
|
|
Incorporated by reference to the Exhibits filed with our S-1/A Registration Statement filed on June 11, 2015 (Reg. No. 333-203138).
|
(b)
|
|
Incorporated by reference to the Exhibits filed with our Current Report on Form 8-K filed on July 6, 2015 (File No. 001-37427).
|
|
|
|
* Certain exhibits and schedules were omitted in the original filing and the Company agrees to furnish supplementally to the Securities and Exchange Commission a copy of any omitted exhibits and schedules upon request.
|
•
|
For purposes of the SERP benefit, the Deferral Contributions benefit, are executive officers of the Company; and
|
•
|
For purposes of the CLRP benefit, have been paid Base Annual Salary (as defined in Section 3.3(b)) in any calendar year that exceeds the annual compensation limit of Code Section 401(a)(17) under the Qualified Plan. Contributions under the CLRP shall be made on a quarterly basis and shall not commence in any calendar year until a participant’s Base Annual Salary has exceeded the Code Section 401(a)(17) cap for such calendar year.
|
Participant’s Age
(As of the contribution date)
|
Company Contribution
(% of Base Annual Salary) |
Less than 40
|
2%
|
40 – 49
|
4%
|
50 and above
|
6%
|
(i)
|
Base Annual Salary
. A participant may designate a percentage to be deducted from his Base Annual Salary. Such amount shall be withheld, in substantially equal installments, from each regularly scheduled payment of Base Annual
|
(ii)
|
Bonus
. A participant may designate a percentage amount to be deducted from his Bonus attributable to the calendar year.
|
(iii)
|
Maximum Deferral
. For any calendar year, the Plan Sponsor may permit a participant to defer, pursuant to an Election Form, one or more of the following forms of compensation up to the maximum percentages:
|
Deferral Category
|
Maximum Amount
|
Base Annual Salary
|
25%
|
Bonus
|
100%
|
(iv)
|
Definitions
.
|
(A)
|
“Base Annual Salary” means the base annual compensation payable to a participant by the Company for services rendered during a calendar year (i) excluding Bonus, cash or in-kind perquisites, or other additional incentives or awards payable to the participant, but (ii) before reduction for any Elective Deductions.
|
(B)
|
“Bonus” means the amounts earned by a participant for services rendered with respect to a calendar year under any bonus or incentive plan or arrangement sponsored by or participated in by the Company, before reduction for any Elective Deductions, but excluding cash or in-kind perquisites, stock-related awards and other non-monetary incentives.
|
(C)
|
“Elective Deductions” means those deductions from a participant’s Base Annual Salary or Bonus for amounts voluntarily deferred or contributed by the participant pursuant to any qualified or non-qualified deferred compensation plan, including, without limitation, amounts deferred pursuant to Code Section 125, 132(f)(4), 402(e)(3) and 402(h), provided, however, that all such amounts would have been payable to the participant in cash had there been no such deferral.
|
(D)
|
“Election Form” is defined and the rules pertaining thereto are described in Section 3.3(c) below.
|
(i)
|
Deferral Election Must be Made in Calendar Year Before Compensation is Earned
. In no event shall a participant be permitted to defer any compensation earned prior to the date such participant’s Election Form has been accepted by the Plan Sponsor. A participant must make an election prior to January 1 of the calendar year for which compensation is to be deferred; provided, however, that upon the initial adoption of the Plan, or upon an employee first becoming eligible to participate in the Plan, a covered employee will be permitted to complete an irrevocable Election Form within 30 days after the later of the effective date of the Plan or his or her eligibility date. A participant cannot change the amount or percentage of the Deferral Contribution or stop making Deferral Contributions at any time during the calendar year except as otherwise permitted by Code Section 409A. Notwithstanding anything in this Section 3 to the contrary, the Plan Administrator, in its sole discretion, may impose additional limitations on the percentage or dollar amount of any participant’s election to defer.
|
(ii)
|
Irrevocability of Deferral Election
. The provisions of the Election Form relating to a participant’s election to defer Base Annual Salary and Bonus is irrevocable for that calendar year. In addition, the participant’s selection of the time and manner of payment of his Deferral Contribution Account shall be irrevocable except as provided in Section 3.5.
|
(iii)
|
Continuation of 2015 Deferral Elections for Initial Participants
. An Initial Participant’s existing deferral election under the TriMas Plan shall be continued under the Plan, because such portion of the Plan is a spinoff and continuation of the TriMas Plan.
|
(iv)
|
The portion of a participant’s Account that was vested on December 31, 2004 shall be paid at the same time and in the same form as the participant’s benefit payments are made from the Qualified Plan; provided that a participant who is eligible for “retirement” under the Qualified Plan due to (a) attainment of age 65, or (b) attainment of age 55 with five years of service under the Qualified Plan, shall be eligible to receive his or her Plan benefit either in the form of installments under the Qualified Plan, or in a lump sum. A participant who terminates employment prior to “retirement” shall receive Plan benefits in the form of a lump sum. Provided, however, that the portion of a participant’s grandfathered Account attributable to contributions on behalf of service rendered by the participant after December 31, 2004, shall be covered under the provisions of Section 3.5(b) below.
|
(v)
|
Notwithstanding 3.5(a)(i), if, upon separation from service, the value of the participant’s Plan benefit when aggregated with the value of the participant’s benefit under any other non-elective account balance plan sponsored by the Company or its affiliates does not exceed the then annual limit set forth in Code Section 402(g)(1)(B) ($18,000 for 2015, as adjusted from time to time for subsequent years), the participant’s balances in all such non-elective account balance plans shall be terminated and liquidated in their entirety, in the form of a lump sum cash payment within 90 days following the participant’s separation from service.
|
(i)
|
For SERP and CLRP Benefits Prior to December 31, 2008
. On or before December 31, 2008, any participant whose retirement benefit hereunder was unvested on December 31, 2004, or has had contributions made to his or her Account on behalf of service rendered after December 31, 2004, shall elect the timing and form of payment for the unvested benefit and/or the portion of the Account attributable to service rendered after December 31, 2004. The participant may not elect a distribution commencement date that occurs in 2008 or is earlier than the employee’s separation from service, as defined under Code Section 409A. The available distribution forms include a lump sum payment or annual installment payments, not to exceed 10 years.
|
(ii)
|
For SERP and CLRP Benefits After December 31, 2008
. After December 31, 2008, an irrevocable initial deferral election for the time and form of payment for SERP and CLRP benefits must be submitted prior to the beginning of the calendar year in which the services are rendered that give rise to the deferred compensation. An exception shall apply when a participant first becomes eligible to participate in the Plan, in which case the submission of an irrevocable election shall not be required until 30 days after the date in which the employee is first eligible to participate (the “Delayed Initial Election Rule”). Notwithstanding the foregoing, if the participant is already eligible to participate in one or more excess benefit plans sponsored by the Company or its affiliates, the Delayed Initial Election Rule shall not apply under this Plan.
|
(iii)
|
Participant Deferral Contributions
. Effective for Deferral Contributions made after December 31, 2010, a participant who elects to make Deferral Contributions must complete an annual irrevocable election for the time and form of payment for distribution of Deferral Contributions (and accumulated earnings) pursuant to the rules described in Section 3.3. On each annual Election Form, participant may select a distribution date for the payment of Deferred Contributions made during the year (or subsequent years). Pursuant to a participant’s election, Deferral Contribution Accounts only (but not SERP and CLRP Accounts) may be distributed prior to the date a Participant incurs a separation from service.
|
(iv)
|
General Rules
. All elections shall be submitted to the Plan Administrator in writing and shall be irrevocable; provided, however, that the employee may change the timing and/or form of payment by submitting a revised election form to the Plan Administrator at least 12 months prior to the date on which the benefit had been scheduled to commence, as long as the revised election form is not effective until 12 months after it has been submitted and specifies
|
(v)
|
Cash-Out of Small Benefits
. Notwithstanding a participant’s election regarding the time and form of payment under the Plan, if, upon separation from service, the value of the participant’s benefit, when aggregated with the value of the participant’s benefit under any other non-elective account balance plan sponsored by the Company or its affiliates, does not exceed the then annual limit set forth in Code Section 402(g)(1)(B) ($18,000 for 2015, as adjusted from time to time for subsequent years), the participant’s balances in all such non-elective account balance plans shall be terminated and liquidated in their entirety, in the form of a lump sum cash payment within 90 days following the participant’s separation from service.
|
(vi)
|
Delayed Commencement Date
. Notwithstanding Section 3.5(b)(i) through 6, all or part of the Plan benefit of a participant who is a “specified employee” under Code Section 409A at the time of the employee’s separation from service, shall be delayed (if then required under Code Section 409A) until the first day of the seventh month following the employee’s separation from service, or the date of the employee’s death, if earlier, unless the employee has elected a payment date that commences on or after the first day of the seventh month following separation from service. Payments that are delayed shall be aggregated and paid in a lump sum on the first day of the seventh month following a participant’s separation from service.
|
(i)
|
CLRP contributions made for years 2003 through 2009 are 100% vested after five years of vesting service.
|
(ii)
|
CLRP contributions made for years commencing on or after January 1, 2010, are 100% vested after three years of vesting service.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Horizon Global 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(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
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5.
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The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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/s/ A. MARK ZEFFIRO
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A. Mark Zeffiro
Chief Executive Officer
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1.
|
I have reviewed this quarterly report on Form 10-Q of Horizon Global Corporation;
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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;
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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;
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4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
|
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/ DAVID G. RICE
|
|
David G. Rice
Chief Financial Officer
|
1.
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ A. MARK ZEFFIRO
|
|
A. Mark Zeffiro
Chief Executive Officer
|
1.
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ DAVID G. RICE
|
|
David G. Rice
Chief Financial Officer
|