10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 26, 2015

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from          to          .

Commission File Number: 333-124824

RBC Bearings Incorporated
(Exact name of registrant as specified in its charter)

Delaware  (State or other jurisdiction of incorporation or organization)	95-4372080 (I.R.S. Employer Identification No.)
One Tribology Center Oxford, CT (Address of principal executive offices)	06478 (Zip Code)

(203) 267-7001
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one): 

Large accelerated filer þ            Accelerated filer o

Non-accelerated filer o (Do not check if a smaller reporting company)   Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

As of October 22, 2015, RBC Bearings Incorporated had 23,421,370 shares of Common Stock outstanding.

TABLE OF CONTENTS

Part I -	FINANCIAL INFORMATION	3
ITEM 1.	Financial Statements	3
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	33
ITEM 4.	Controls and Procedures	33
	Changes in Internal Control over Financial Reporting	33
Part II -	OTHER INFORMATION	34
ITEM 1.	Legal Proceedings	34
ITEM 1A.	Risk Factors	34
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	35
ITEM 3.	Defaults Upon Senior Securities	35
ITEM 4.	Mine Safety Disclosures	35
ITEM 5.	Other Information	35
ITEM 6.	Exhibits	36

2

Part I. FINANCIAL INFORMATION

Item 1. Financial Statements

RBC Bearings Incorporated

Consolidated Balance Sheets

(dollars in thousands, except share and per share data)

	September 26, 2015			March 28, 2015
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	44,077		$	125,455
Accounts receivable, net of allowance for doubtful accounts of $1,643 at September 26, 2015 and $860 at March 28, 2015		97,132			76,651
Inventory		262,883			206,158
Deferred income taxes		11,336			12,492
Prepaid expenses and other current assets		9,306			4,628
Total current assets		424,734			425,384
Property, plant and equipment, net		184,102			141,649
Goodwill		269,901			43,439
Intangible assets, net of accumulated amortization of $17,355 at September 26, 2015 and $13,185 at March 28, 2015		208,553			12,028
Other assets		9,169			9,573
Total assets	$	1,096,459		$	632,073
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	37,092		$	23,459
Accrued expenses and other current liabilities		30,311			17,326
Current portion of long-term debt		8,725			1,233
Total current liabilities		76,128			42,018
Deferred income taxes		22,355			10,126
Long-term debt, less current portion		393,573			7,965
Other non-current liabilities		28,728			22,531
Total liabilities		520,784			82,640
Stockholders' equity:
Preferred stock, $.01 par value; authorized shares: 10,000,000 at September 26, 2015 and March 28, 2015; none issued and outstanding		—			—
Common stock, $.01 par value; authorized shares: 60,000,000 at September 26, 2015 and March 28, 2015; issued and outstanding shares: 23,989,656 at September 26, 2015 and 23,833,185 at March 28, 2015		240			238
Additional paid-in capital		270,236			262,091
Accumulated other comprehensive loss		(9,900	)		(7,770	)
Retained earnings		342,099			314,176
Treasury stock, at cost, 559,856 shares at September 26, 2015 and 439,864 shares at March 28, 2015		(27,000	)		(19,302	)
Total stockholders' equity		575,675			549,433
Total liabilities and stockholders' equity	$	1,096,459		$	632,073

See accompanying notes.

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RBC Bearings Incorporated

Consolidated Statements of Operations

(dollars in thousands, except share and per share data)

(Unaudited)

	Three Months Ended						Six Months Ended
	September 26, 2015			September 27, 2014			September 26, 2015		September 27, 2014
Net sales	$	148,696		$	112,555		$	291,004	$	225,539
Cost of sales		96,578			72,804			186,122		141,967
Gross margin		52,118			39,751			104,882		83,572
Operating expenses:
Selling, general and administrative		24,944			18,517			48,669		37,513
Other, net		3,575			2,937			10,253		3,551
Total operating expenses		28,519			21,454			58,922		41,064
Operating income		23,599			18,297			45,960		42,508
Interest expense, net		2,273			308			3,984		532
Other non-operating (income) expense		(596	)		(235	)		10		(502	)
Income before income taxes		21,922			18,224			41,966		42,478
Provision for income taxes		7,403			4,976			14,043		13,210
Net income	$	14,519		$	13,248		$	27,923	$	29,268
Net income per common share:
Basic	$	0.63		$	0.57		$	1.20	$	1.27
Diluted	$	0.62		$	0.57		$	1.19	$	1.25
Weighted average common shares:
Basic		23,210,640			23,134,902			23,186,600		23,070,170
Diluted		23,495,285			23,424,421			23,516,537		23,394,439
Dividends per share	$	—		$	—		$	—	$	2.00

See accompanying notes.

4

RBC Bearings Incorporated

Consolidated Statements of Comprehensive Income

(dollars in thousands)

(Unaudited)

	Three Months Ended						Six Months Ended
	September 26, 2015			September 27, 2014			September 26, 2015			September 27, 2014
Net income	$	14,519		$	13,248		$	27,923		$	29,268
Pension and postretirement liability adjustments, net of taxes		(228	)		199			(455	)		398
Unrealized gain on investments, net of taxes		—			(345	)		—			(273	)
Foreign currency translation adjustments		(3,380	)		(5,152	)		(1,675	)		(5,971	)
Total comprehensive income	$	10,911		$	7,950		$	25,793		$	23,422

See accompanying notes.

5

RBC Bearings Incorporated

Consolidated Statements of Cash Flows

(dollars in thousands)

(Unaudited)

	Six Months Ended
	September 26, 2015			September 27, 2014
Cash flows from operating activities:
Net income	$	27,923		$	29,268
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		8,302			7,103
Excess tax benefits from stock-based compensation		(1,682	)		(2,778	)
Deferred income taxes		791			218
Amortization of intangible assets		4,170			964
Amortization of deferred financing costs		621			163
Consolidation and restructuring charges		—			5,026
Stock-based compensation		4,628			4,035
Other non-cash charges		232			500
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable		4,068			2,848
Inventory		(9,481	)		(6,291	)
Prepaid expenses and other current assets		(3,946	)		(2,669	)
Other non-current assets		(20	)		(670	)
Accounts payable		(1,206	)		(560	)
Accrued expenses and other current liabilities		769			7,451
Other non-current liabilities		5,091			120
Net cash provided by operating activities		40,260			44,728
Cash flows from investing activities:
Purchase of property, plant and equipment		(9,799	)		(11,458	)
Proceeds from sale of short-term investments		—			2,380
Proceeds from sale of assets		40			593
Business acquisition		(500,000	)		—
Net cash used in investing activities		(509,759	)		(8,485	)
Cash flows from financing activities:
Proceeds from revolving credit facility		225,000			—
Repayments of revolving credit facility		(20,000	)		—
Proceeds from term loans		200,000			—
Repayments of term loans		(5,245	)		(259	)
Finance fees paid in connection with credit facility		(7,122	)		—
Exercise of stock options		1,837			2,992
Excess tax benefits from stock-based compensation		1,682			2,778
Repurchase of common stock		(7,698	)		(4,721	)
Dividends paid to shareholders		—			(46,014	)
Other, net		—			(101	)
Net cash provided by (used in) financing activities		388,454			(45,325	)
Effect of exchange rate changes on cash		(333	)		(2,678	)
Cash and cash equivalents:
Decrease during the period		(81,378	)		(11,760	)
Cash, at beginning of period		125,455			121,207
Cash, at end of period	$	44,077		$	109,447

See accompanying notes.

6

RBC Bearings Incorporated

Notes to Unaudited Interim Consolidated Financial Statements

(dollars in thousands, except share and per share data)

The consolidated financial statements included herein have been prepared by RBC Bearings Incorporated, a Delaware corporation (collectively with its subsidiaries, the “Company”), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. The March 28, 2015 fiscal year end balance sheet data have been derived from the Company’s audited financial statements, but do not include all disclosures required by generally accepted accounting principles in the United States. The interim financial statements included with this report have been prepared on a consistent basis with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 28, 2015.

These statements reflect all adjustments, accruals and estimates consisting only of items of a normal recurring nature, which are, in the opinion of management, necessary for the fair presentation of the consolidated financial condition and consolidated results of operations for the interim periods presented. These financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Annual Report on Form 10-K.

The results of operations for the six month period ended September 26, 2015 are not necessarily indicative of the operating results for the entire fiscal year ending April 2, 2016. The three month periods ended September 26, 2015 and September 27, 2014 each include 13 weeks. The amounts shown are in thousands, unless otherwise indicated.

Adoption of Recent Accounting Pronouncements

In September 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-16, “Business Combinations (Topic 805), Simplifying the Accounting for Measurement-Period Adjustments.” This ASU allows an acquirer in a business combination to account for measurement-period adjustments during the period in which it determines the amount of the adjustment. An acquirer would also need to capture in the current period any effect on earnings it would have recorded in previous periods if the accounting had been completed at the acquisition date. This pronouncement is effective for fiscal and interim periods beginning after December 15, 2015. Early adoption is permitted. The Company has adopted this update effective with their interim period beginning March 29, 2015.

In April 2015, the FASB issued ASU No. 2015-04, “Compensation - Retirement Benefits: Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets.” This ASU permits an entity with a fiscal year-end that does not coincide with a month-end, to measure defined benefit plan assets and obligations using the month end that is closest to the entity’s fiscal year-end and apply that consistently from year to year. The practical expedient requires if a contribution or significant event occurs between the month-end date used to measure the defined benefit plan assets and an entity’s fiscal year end, the entity should adjust the measurement of the defined benefit plan assets and obligations to reflect the effects of those contributions and other significant events. This pronouncement is effective for fiscal and interim periods beginning after December 15, 2015. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-03, “Interest - Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs.” This ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. This pronouncement is effective for fiscal and interim periods beginning after December 15, 2015. Early adoption is allowed. Given the requirement for retrospective treatment, the Company adopted this pronouncement in the first quarter of fiscal 2016. Other than a different presentation within the balance sheet, the adoption of this ASU did not have a material impact on the Company’s financial statements.

7

In January 2015, the FASB issued ASU No. 2015-01, “Income Statement-Extraordinary and Unusual Items.” This update eliminates the concept of extraordinary items and removes the requirements to separately present extraordinary events. This ASU also requires additional disclosures for items that are both unusual in nature and infrequent in occurrence. This pronouncement is effective for fiscal years and interim periods beginning after December 15, 2015. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements-Going Concern.” This update requires management to evaluate whether there are conditions or events that raise substantial doubt about an entity’s ability to continue as a going concern, and requires related footnote disclosures. This pronouncement is effective for fiscal years and interim periods beginning after December 15, 2016. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” to clarify existing guidance on revenue recognition. This guidance includes the required steps to achieve the core principle that a company should recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. This pronouncement is effective for fiscal years and interim periods beginning after December 15, 2016 with no early adoption permitted. The Company has not determined the effect that the adoption of the pronouncement may have on its financial position and/or results of operations.

In April 2014, the FASB issued ASU No. 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.” This update requires additional disclosures about discontinued operations and amends the requirements for reporting discontinued operations. Under this ASU only disposals constituting a major financial or operational impact or that represent a strategic shift should be reported as discontinued operations. This update also requires new disclosures for individually material disposals that do not qualify as discontinued operations. This guidance was adopted by the Company at the beginning of the second quarter of fiscal 2015. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements.

1. Accumulated Other Comprehensive Income (Loss)

The components of comprehensive income (loss) that relate to the Company are net income, foreign currency translation adjustments and pension plan and postretirement benefits, all of which are presented in the consolidated statements of stockholders' equity and comprehensive income (loss).

The following summarizes the activity within each component of accumulated other comprehensive income (loss):

	Currency Translation			Pension and Postretirement Liability			Total
Balance at March 28, 2015	$	(93	)	$	(7,677	)	$	(7,770	)
Other comprehensive income (loss) before reclassifications (net of taxes)		(1,675	)		(373	)		(2,048	)
Amounts reclassified from accumulated other comprehensive income (loss)		—			(82	)		(82	)
Net current period other comprehensive income (loss)		(1,675	)		(455	)		(2,130	)
Balance at September 26, 2015	$	(1,768	)	$	(8,132	)	$	(9,900	)

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2. Net Income Per Common Share

Basic net income per common share is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding.

Diluted net income per common share is computed by dividing net income by the sum of the weighted-average number of common shares and dilutive common share equivalents then outstanding using the treasury stock method. Common share equivalents consist of the incremental common shares issuable upon the exercise of stock options.

The table below reflects the calculation of weighted-average shares outstanding for each period presented as well as the computation of basic and diluted net income per common share:

	Three Months Ended				Six Months Ended
	September 26, 2015		September 27, 2014		September 26, 2015		September 27, 2014
Net income	$	14,519	$	13,248	$	27,923	$	29,268
Denominator for basic net income per common share—weighted-average shares outstanding		23,210,640		23,134,902		23,186,600		23,070,170
Effect of dilution due to employee stock awards		284,645		289,519		329,937		324,269
Denominator for diluted net income per common share — weighted-average shares outstanding		23,495,285		23,424,421		23,516,537		23,394,439
Basic net income per common share	$	0.63	$	0.57	$	1.20	$	1.27
Diluted net income per common share	$	0.62	$	0.57	$	1.19	$	1.25

At September 26, 2015, 408,000 employee stock options and 73,850 restricted shares have been excluded from the calculation of diluted earnings per share. At September 27, 2014, 419,650 employee stock options and 800 restricted shares have been excluded from the calculation of diluted earnings per share. The inclusion of these employee stock options would be anti-dilutive.

3. Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.

Short-term investments, if any, are comprised of equity securities and are measured at fair value by using quoted prices in active markets and are classified as Level 1 of the valuation hierarchy.

4. Inventory

Inventories are stated at the lower of cost or market, using the first-in, first-out method, and are summarized below:

	September 26, 2015		March 28, 2015
Raw materials	$	29,361	$	18,424
Work in process		76,514		50,243
Finished goods		157,008		137,491
	$	262,883	$	206,158

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5. Goodwill and Intangible Assets

Goodwill

	Roller		Plain		Ball		Engineered Products			Total
March 28, 2015	$	16,007	$	20,641	$	5,623	$	1,168		$	43,439
Acquisitions		—		57,479		—		169,002			226,481
Other		—		—		—		(19	)		(19	)
September 26, 2015	$	16,007	$	78,120	$	5,623	$	170,151		$	269,901

Intangible Assets

		September 26, 2015				March 28, 2015
	Weighted Average Useful Lives	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Product approvals	24	$	54,285	$	3,349	$	4,068	$	2,372
Customer relationships and lists	24		110,696		6,348		9,017		4,349
Trade names	10		19,990		2,219		2,102		1,372
Distributor agreements	5		722		722		722		722
Patents and trademarks	15		7,881		3,345		7,670		3,039
Domain names	10		437		320		437		299
Other	5		1,197		1,052		1,197		1,032
			195,208		17,355		25,213		13,185
Non-amortizable repair station certifications	n/a		30,700		—		—		—
Total		$	225,908	$	17,355	$	25,213	$	13,185

Amortization expense for definite-lived intangible assets for the three and six month periods ended September 26, 2015 was $2,402 and $4,170, respectively. Amortization expense for definite-lived intangible assets for the three and six month periods ended September 27, 2014 was $467 and $964, respectively. Estimated amortization expense for the remaining six months of fiscal 2016, the five succeeding fiscal years and thereafter is as follows:

2016	$	4,814
2017		9,562
2018		9,439
2019		9,216
2020		9,108
2021		9,058
2022 and thereafter		126,656

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6. Debt

The balances payable under all borrowing facilities are as follows:

	September 26, 2015			March 28, 2015
Revolver and term loan facilities	$	400,000		$	—
Debt issuance costs		(6,529	)		—
Other		8,827			9,198
Total debt		402,298			9,198
Less: current portion		8,725			1,233
Long-term debt	$	393,573		$	7,965

New Credit Facility

In connection with the Sargent Aerospace & Defense (“Sargent”) acquisition on April 24, 2015, the Company entered into a new credit agreement (the “New Credit Agreement”) and related Guarantee, Pledge Agreement and Security Agreement with Wells Fargo Bank, National Association, as Administrative Agent, Collateral Agent, Swingline Lender and Letter of Credit Issuer and the other lenders party thereto and terminated the JP Morgan Credit Agreement. The New Credit Agreement provides RBCA, as Borrower, with (a) a $200,000 term loan facility (the “Term Loan”) and (b) a $350,000 revolving credit facility (the “Revolver” and together with the Term Loan, the “Facilities”).

Amounts outstanding under the Facilities generally bear interest at (a) a base rate determined by reference to the higher of (1) Wells Fargo’s prime lending rate, (2) the federal funds effective rate plus 1/2 of 1% and (3) the one-month LIBOR rate plus 1% or (b) LIBOR rate plus a specified margin, depending on the type of borrowing being made. The applicable margin is based on the Company's consolidated ratio of total net debt to consolidated EBITDA from time to time. Currently, the Company's margin is 0.5% for base rate loans and 1.5% for LIBOR rate loans. As of September 26, 2015, there was $205,000 outstanding under the Revolver and $195,000 outstanding under the Term Loan, offset by $6,529 in debt issuance costs (original amount was $7,122).

The New Credit Agreement requires the Company to comply with various covenants, including among other things, financial covenants to maintain the following: (1) a ratio of consolidated net debt to adjusted EBITDA, not to exceed 3.50 to 1; and (2) a consolidated interest coverage ratio not to exceed 2.75 to 1. The New Credit Agreement allows the Company to, among other things, make distributions to shareholders, repurchase its stock, incur other debt or liens, or acquire or dispose of assets provided that the Company complies with certain requirements and limitations of the agreement. As of September 26, 2015, the Company was in compliance with all such covenants.

The Company’s obligations under the New Credit Agreement are secured as well as providing for a pledge of substantially all of the Company’s and RBCA’s assets. The Company and certain of its subsidiaries have also entered into a Guarantee to guarantee RBCA’s obligations under the New Credit Agreement.

Approximately $3,290 of the Revolver is being utilized to provide letters of credit to secure RBCA’s obligations relating to certain insurance programs, and $225,000 was utilized to finance the acquisition of Sargent. As of September 26, 2015, RBCA paid down $20,000 of the Revolver and has the ability to borrow up to an additional $141,710 under the Revolver.

Prior Credit Facility

On November 30, 2010, the Company entered into a credit agreement (the “JP Morgan Credit Agreement”) and related security and guaranty agreements with certain banks, J.P. Morgan Chase Bank, N.A., as Administrative Agent, and J.P. Morgan Chase Bank, N.A. and KeyBank National Association as Co-Lead Arrangers and Joint Lead Book Runners. The JP Morgan Credit Agreement provides Roller Bearing Company of America, Inc. (“RBCA”), as borrower, with a $150,000 five-year senior secured revolving credit facility which can be increased by up to $100,000, in increments of $25,000, under certain circumstances and subject to certain conditions (including the receipt from one or more lenders of the additional commitment).

11

Amounts outstanding under the JP Morgan Credit Agreement generally bear interest at the prime rate or LIBOR plus a specified margin, depending on the type of borrowing being made. The applicable margin is based upon the Company’s consolidated ratio of net debt to adjusted EBITDA, measured at the end of each quarter. As of September 27, 2014, the Company’s margin is 0.5% for prime rate loans and 1.5% for LIBOR rate loans.

The JP Morgan Credit Agreement requires the Company to comply with various covenants, including among other things, financial covenants to maintain the following: (1) a ratio of consolidated net debt to adjusted EBITDA, not to exceed 3.25 to 1; and (2) a consolidated fixed charge coverage ratio not to exceed 1.5 to 1. The credit agreement allows the Company to, among other things, make distributions to shareholders, repurchase its stock, incur other debt or liens, or acquire or dispose of assets provided that the Company complies with certain requirements and limitations of the agreement. The JP Morgan Credit Agreement was terminated and replaced by the New Credit Agreement discussed above. $190 of debt issuance costs were written off on termination.

Other Notes Payable

On October 1, 2012, Schaublin purchased the land and building, which it occupied and had been leasing, for 14,067 CHF (approximately $14,910). Schaublin obtained a 20 year fixed rate mortgage of 9,300 CHF (approximately $9,857) at an interest rate of 2.9%. The balance of the purchase price of 4,767 CHF (approximately $5,053) was paid from cash on hand. The balance on this mortgage as of September 26, 2015 was 7,905 CHF, or $8,077.

7. Income Taxes

The Company files income tax returns in the U.S. federal jurisdiction, various states and foreign jurisdictions. With few exceptions, the Company is no longer subject to state or foreign income tax examinations by tax authorities for years ending before March 31, 2007. The Company is no longer subject to U.S. federal corporate income tax examination by the Internal Revenue Service for fiscal years ending before March 29, 2014. A U.S. federal corporate income tax examination by the Internal Revenue Service for the fiscal year ended March 30, 2013 was deemed effectively settled in the Company’s first quarter of fiscal 2016.

The effective income tax rates for the three month periods ended September 26, 2015 and September 27, 2014, were 33.8% and 27.3%. In addition to discrete items, the effective income tax rates for these periods are different from the U.S. statutory rates due to a special manufacturing deduction in the U.S. and foreign income taxed at lower rates which decrease the rate, and state income taxes which increases the rate.

The effective income tax rate for the three month period ended September 26, 2015 of 33.8% includes immaterial discrete items of $51. The effective income tax rate without discrete items for the three month period ended September 26, 2015 would have been 33.5%. The effective income tax rate for the three month period ended September 27, 2014 of 27.3% includes discrete items of $3,131 which are comprised substantially of items associated with the consolidation and restructuring of the Company’s U.K. manufacturing facility. The effective income tax rate without discrete items and without other associated consolidated and restructuring expenses pertaining to the Company’s UK manufacturing facility for the three month period ended September 27, 2014 would have been 32.9%. The Company believes it is reasonably possible that some of its unrecognized tax positions may be effectively settled within the next twelve months due to the closing of audits and the statute of limitations expiring in varying jurisdictions. The decrease, pertaining primarily to credits and state tax, is estimated to be approximately $449.

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8. Reportable Segments

The Company operates through operating segments for which separate financial information is available, and for which operating results are evaluated regularly by the Company's chief operating decision maker in determining resource allocation and assessing performance. Those operating segments with similar economic characteristics and that meet all other required criteria, including nature of the products and production processes, distribution patterns and classes of customers, are aggregated as reportable segments. With the acquisition and integration of Sargent into the Company’s operating and reportable segment structure, the Company has transitioned the Other segment to a new reportable segment titled Engineered Products. The Company has four reportable business segments; Plain Bearings, Roller Bearings, Ball Bearings and Engineered Products, which are described below.

Plain Bearings. Plain bearings are produced with either self-lubricating or metal-to-metal designs and consists of several sub-classes, including rod end bearings, spherical plain bearings and journal bearings. Unlike ball bearings, which are used in high-speed rotational applications, plain bearings are primarily used to rectify inevitable misalignments in various mechanical components. The bearings and rings businesses of Sargent are included here.

Roller Bearings. Roller bearings are anti-friction bearings that use rollers instead of balls. The Company manufactures four basic types of roller bearings: heavy duty needle roller bearings with inner rings, tapered roller bearings, track rollers and aircraft roller bearings.

Ball Bearings. The Company manufactures four basic types of ball bearings: high precision aerospace, airframe control, thin section and commercial ball bearings which are used in high-speed rotational applications.

Engineered Products. Engineered Products consists of highly engineered hydraulics, fasteners, collets and precision components used in aerospace, marine and industrial applications. The hydraulics, fasteners and precision components businesses of Sargent are included here.

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Segment performance is evaluated based on segment net sales and operating income. Items not allocated to segment operating income include corporate administrative expenses and certain other amounts.

	Three Months Ended						Six Months Ended
	September 26, 2015			September 27, 2014			September 26, 2015			September 27, 2014
Net External Sales
Plain	$	67,607		$	57,458		$	133,284		$	117,331
Roller		27,151			33,504			57,731			65,269
Ball		13,122			14,093			25,941			27,638
Engineered Products		40,816			7,500			74,048			15,301
	$	148,696		$	112,555		$	291,004		$	225,539
Gross Margin
Plain	$	26,763		$	20,817		$	52,711		$	43,284
Roller		11,355			10,799			24,250			23,590
Ball		5,292			5,360			10,475			10,787
Engineered Products		8,708			2,775			17,446			5,911
	$	52,118		$	39,751		$	104,882		$	83,572
Selling, General & Administrative Expenses
Plain	$	5,906		$	4,588		$	11,389		$	9,350
Roller		1,483			1,566			2,973			3,251
Ball		1,370			1,279			2,738			2,607
Engineered Products		4,176			881			8,122			1,861
Corporate		12,009			10,203			23,447			20,444
	$	24,944		$	18,517		$	48,669		$	37,513
Operating Income
Plain	$	20,784		$	15,950		$	41,089		$	33,503
Roller		9,724			6,497			21,064			17,449
Ball		3,775			3,914			7,447			7,867
Engineered Products		2,303			1,909			4,863			4,034
Corporate		(12,987	)		(9,973	)		(28,503	)		(20,345	)
	$	23,599		$	18,297		$	45,960		$	42,508
Geographic External Sales
Domestic	$	130,521		$	93,387		$	253,501		$	188,433
Foreign		18,175			19,168			37,503			37,106
	$	148,696		$	112,555		$	291,004		$	225,539
Intersegment Sales
Plain	$	977		$	1,041		$	2,116		$	2,020
Roller		5,182			5,056			10,695			10,039
Ball		486			706			1,047			1,258
Engineered Products		7,023			7,840			15,134			15,028
	$	13,668		$	14,643		$	28,992		$	28,345

All intersegment sales are eliminated in consolidation.

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9. Restructuring of Operations

In the second quarter of fiscal 2015, the Company consolidated the manufacturing capacity of its United Kingdom (U.K.) facility into its other manufacturing facilities in order to better align manufacturing abilities and product development. As a result the Company recorded a charge of $6,382 in the second quarter and $88 in the third quarter of fiscal 2015 associated with the consolidation of operations attributable to the Roller Bearings segment. The $6,382 charge includes $3,707 of inventory rationalization costs that were recorded in cost of sales in the income statement. All other costs were recorded under operating expenses in the other, net category of the income statement. The pre-tax charge of $6,382 was offset with an associated tax benefit of $3,131.

10. Acquisitions

On April 24, 2015, the Company acquired Sargent from Dover Corporation for $500,000 financed through a combination of cash on hand and senior debt. With headquarters in Tucson, Arizona, Sargent is a leader in precision-engineered products, solutions and repairs for aircraft airframes and engines, rotorcraft, submarines and land vehicles. Sargent manufactures, sells and services hydraulic valves and actuators, specialty bearings, specialty fasteners, seal rings & alignment joints and engineered components under leading brands including Kahr Bearing, Airtomic, Sonic Industries, Sargent Controls and Sargent Aerospace & Defense. The Company acquired Sargent because management believes it provides complementary products and channels, and expands and enhances the Company’s product portfolio and engineering technologies. The bearings and rings businesses are included in the Plain Bearings segment. The hydraulics, fasteners and precision components businesses are included in the Engineered Products segment.

The acquisition of Sargent was accounted for as a purchase in accordance with FASB Accounting Standards Codification (“ASC”) Topic 805, Business Combinations. Assets acquired and liabilities assumed were recorded at their fair values as of the acquisition date. The fair values of identifiable intangible assets, which were primarily customer relationships, product approvals, trade names, and patents and trademarks, were based on valuations using the income approach. The excess of the purchase price over the estimated fair values of tangible assets, identifiable intangible assets and assumed liabilities was recorded as goodwill. The goodwill is attributable to expected synergies and expected growth opportunities. The preliminary price allocation resulted in goodwill of $226,481. The Company estimates a majority of goodwill will be deductible for United States income tax purposes. The allocation of purchase price is preliminary as the Company has not completed its analysis estimating the fair value of inventory, property, plant, and equipment, intangible assets, income tax liabilities and certain contingent liabilities. The purchase price allocation was updated to reflect current estimated fair values at the acquisition date, with the excess of purchase price over the estimated fair value of the net assets acquired recorded as goodwill.

The preliminary purchase price allocation for Sargent was as follows:

	As of April 24, 2015
Current assets	$	3,086
Trade receivables		23,892
Inventories		47,709
Property, plant and equipment		41,538
Intangible assets		201,000
Goodwill		226,481
Total assets acquired		543,706
Accounts payable		14,900
Liabilities assumed		28,806
Net assets acquired	$	500,000

The valuation of the net assets acquired of $500,000 was classified as Level 3 in the valuation hierarchy. Level 3 inputs represent unobservable inputs for the asset or liability.

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The components of intangible assets included as part of the Sargent acquisition was as follows:

	Weighted Average Amortization Period (Years)	Gross Value
Amortizable intangible assets
Customer relationships	25	$	101,800
Product approvals	25		50,500
Trademarks and tradenames	10		18,000
			170,300
Non-amortizable intangible assets
Repair station certifications	-		30,700
Intangible assets		$	201,000

Included in the Company’s results of operations for the three and six months ended September 26, 2015 are revenues related to the Sargent acquisition of $45,507 and $79,509, respectively. Also, included for the three and six months ended September 26, 2015 is net income of $1,407 and $5,232, respectively. Acquisition-related expenses were recorded in Other, net in the Consolidated Statements of Operations for both the three and six months ended September 26, 2015 of $1,283 and $6,071, respectively.

The following supplemental pro forma financial information presents the financial results for the three and six months ended September 26, 2015 and September 27, 2014, as if the acquisition of Sargent had occurred at the beginning of fiscal year 2015. The pro forma financial information includes, where applicable, adjustments for: (i) the estimated amortization of acquired intangible assets, (ii) estimated additional interest expense on acquisition related borrowings, (iii) the income tax effect on the pro forma adjustments using an estimated effective tax rate. The pro forma financial information excludes, where applicable, adjustments for: (i) the estimated impact of inventory purchase accounting adjustments and (ii) the estimated closing costs on the acquisition. The pro forma financial information is presented for illustrative purposes only and is not necessarily indicative of the operating results that would have been achieved had the acquisition been completed as of the date indicated or the results that may be obtained in the future:

	Three Months Ended				Six Months Ended
	September 26, 2015		September 27, 2014		September 26, 2015		September 27, 2014
Pro forma net sales	$	148,696	$	162,145	$	299,378	$	325,355
Pro forma net income		18,058		14,170		34,723		30,856
Basic earnings per share as reported	$	0.63	$	0.57	$	1.20	$	1.27
Pro forma basic earnings per share		0.78		0.61		1.50		1.34
Diluted earnings per share as reported	$	0.62	$	0.57	$	1.19	$	1.25
Pro forma diluted earnings per share		0.77		0.60		1.48		1.32

On October 7, 2013, the Company acquired the net assets of Turbine Components Inc. (“TCI”) for approximately $3,925. Located in San Diego, California, TCI is an FAA certified aircraft gas turbine repair station and manufacturer of precision components for aerospace markets. TCI’s net sales for the prior calendar year were approximately $4,000. The purchase price allocation is as follows: accounts receivable ($585), inventory ($125), fixed assets ($1,231), goodwill ($2,821), intangible assets ($441), other non-current assets ($127), other current liabilities ($641) and noncurrent liabilities ($766). The purchase price allocation, which resulted in goodwill of $2,821, is deductible for tax purposes. TCI is included in the Plain Bearings segment. In connection with the acquisition the Company agreed to a contract for additional contingent consideration that is dependent on the outcome of future events. The contingent consideration is based on a market valuation formula and will be payable five years from the acquisition date. The current fair value of the contingent consideration is determined to be $469. Pro forma net sales and net income inclusive of TCI are not materially different from the amounts reported in the accompanying consolidated statements of operations.

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On August 16, 2013, the Company acquired Climax Metal Products Company (“CMP”) located in Mentor, Ohio for $13,646. The purchase price included $10,672 in cash and $2,974 of debt. CMP is a manufacturer of precision shaft collars, rigid couplings, keyless locking devices and bearings for the industrial markets. CMP’s net sales for the prior calendar year were approximately $14,100. The purchase price allocation is as follows: accounts receivable ($1,206), inventory ($4,509), other current assets ($73), fixed assets ($2,466), goodwill ($5,623), intangible assets ($3,904), other non-current assets ($10), other current liabilities ($2,171) and noncurrent liabilities ($1,974). The purchase price allocation, which resulted in goodwill of $5,623, is not deductible for tax purposes. CMP is included in the Ball Bearings segment. Pro forma net sales and net income inclusive of CMP are not materially different from the amounts reported in the accompanying consolidated statements of operations.

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Statement As To Forward-Looking Information

The information in this discussion contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 which are subject to the “safe harbor” created by those sections. All statements other than statements of historical facts, included in this quarterly report on Form 10-Q regarding our strategy, future operations, future financial position, future revenues, projected costs, prospects and plans and objectives of management are “forward-looking statements” as the term is defined in the Private Securities Litigation Reform Act of 1995.

The words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that we make. These forward-looking statements involve risks and uncertainties that could cause our actual results to differ materially from those in the forward-looking statements, including, without limitation: (a) the bearing industry is highly competitive, and this competition could reduce our profitability or limit our ability to grow; (b) the loss of a major customer could result in a material reduction in our revenues and profitability; (c) weakness in any of the industries in which our customers operate, as well as the cyclical nature of our customers’ businesses generally, could materially reduce our revenues and profitability; (d) future reductions or changes in U.S. government spending could negatively affect our business; (e) fluctuating or interruption to supply, and availability of raw materials, components and energy resources could materially increase our costs or reduce our revenues, cash flow from operations and profitability; (f) our products are subject to certain approvals, and the loss of such approvals could materially reduce our revenues and profitability; (g) restrictions in our indebtedness agreements could limit our growth and our ability to respond to changing conditions; (h) work stoppages and other labor problems could materially reduce our ability to operate our business; (i) our business is capital intensive and may consume cash in excess of cash flow from our operations; (j) unexpected equipment failures, catastrophic events or capacity constraints may increase our costs and reduce our sales due to production curtailments or shutdowns; (k) we may not be able to continue to make the acquisitions necessary for us to realize our growth strategy; (l) the costs and difficulties of integrating acquired businesses could impede our future growth; (m) we depend heavily on our senior management and other key personnel, the loss of whom could materially affect our financial performance and prospects; (n) our international operations are subject to risks inherent in such activities; (o) currency translation risks may have a material impact on our results of operations; (p) we may be required to make significant future contributions to our pension plan; (q) we may incur material losses for product liability and recall related claims; (r) environmental regulations impose substantial costs and limitations on our operations, and environmental compliance may be more costly than we expect; (s) our intellectual property and other proprietary rights are valuable, and any inability to protect them could adversely affect our business and results of operations; in addition, we may be subject to infringement claims by third parties; (t) cancellation of orders in our backlog of orders could negatively impact our revenues; (u) if we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud; (v) provisions in our charter documents may prevent or hinder efforts to acquire a controlling interest in us; (w) health care reform could adversely affect our operating results; and (x) we may not pay cash dividends in the foreseeable future. Additional information regarding these and other risks and uncertainties is contained in our periodic filings with the SEC, including, without limitation, the risks identified under the heading “Risk Factors” set forth in the Annual Report on Form 10-K for the year ended March 28, 2015. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make. We do not intend, and undertake no obligation, to update or alter any forward-looking statement. The following section is qualified in its entirety by the more detailed information, including our financial statements and the notes thereto, which appears elsewhere in this Quarterly Report.

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Overview

We are a well known international manufacturer and maker of highly engineered precision bearings and components. Our precision solutions are integral to the manufacture and operation of most machines and mechanical systems, reduce wear to moving parts, facilitate proper power transmission and reduce damage and energy loss caused by friction. While we manufacture products in all major categories, we focus primarily on the higher end of the bearing and engineered component markets where we believe our value added manufacturing and engineering capabilities enable us to differentiate ourselves from our competitors and enhance profitability. We believe our unique expertise has enabled us to garner leading positions in many of the product markets in which we primarily compete. With 37 facilities, of which 33 are manufacturing facilities in five countries, we have been able to significantly broaden our end markets, products, customer base and geographic reach. We currently operate under four reportable business segments: Plain Bearings; Roller Bearings; Ball Bearings; and Engineered Products. The following further describes these reportable segments:

Plain Bearings. Plain bearings are produced with either self-lubricating or metal-to-metal designs and consists of several sub-classes, including rod end bearings, spherical plain bearings and journal bearings. Unlike ball bearings, which are used in high-speed rotational applications, plain bearings are primarily used to rectify inevitable misalignments in various mechanical components.

Roller Bearings. Roller bearings are anti-friction bearings that use rollers instead of balls. We manufacture four basic types of roller bearings: heavy duty needle roller bearings with inner rings, tapered roller bearings, track rollers and aircraft roller bearings.

Ball Bearings. We manufacture four basic types of ball bearings: high precision aerospace, airframe control, thin section and commercial ball bearings which are used in high-speed rotational applications.

Engineered Products. Engineered Products consists of highly engineered hydraulics, fasteners, collets and precision components used in aerospace, marine and industrial applications.

Purchasers of bearings and engineered products include industrial equipment and machinery manufacturers, producers of commercial and military aerospace equipment such as missiles and radar systems, agricultural machinery manufacturers, construction, energy, mining, marine and specialized equipment manufacturers and automotive and commercial truck manufacturers. The markets for our products are cyclical, and we have endeavored to mitigate this cyclicality by entering into sole-source relationships and long-term purchase orders, through diversification across multiple market segments within the aerospace and defense and diversified industrial segments, by increasing sales to the aftermarket and by focusing on developing highly customized solutions.

Currently, our strategy is built around maintaining our role as a leading manufacturer of highly engineered bearings and components through the following efforts:

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· Developing innovative solutions. By leveraging our design and manufacturing expertise and our extensive customer relationships, we continue to develop new products for markets in which there are substantial growth opportunities.

· Expanding customer base and penetrating end markets. We continually seek opportunities to access new customers, geographic locations and platforms with existing products or profitable new product opportunities.

· Increasing aftermarket sales. We believe that increasing our aftermarket sales of replacement parts will further enhance the continuity and predictability of our revenues and enhance our profitability. Such sales included sales to third party distributors and sales to OEMs for replacement bearings and components. We will increase the percentage of our revenues derived from the replacement market by continuing to implement several initiatives.

· Pursuing selective acquisitions. The acquisition of businesses that complement or expand our operations has been and continues to be an important element of our business strategy. We believe that there will continue to be consolidation within the industry that may present us with acquisition opportunities.

The following items highlight the most recent significant events:

· In the first quarter of fiscal 2016, subsequent to the close of the fiscal 2015 year, we acquired Sargent for $500 million financed through a combination of cash on hand and senior debt. Headquartered in Tucson, Arizona, Sargent is a leader in precision-engineered products, solutions and repairs for aircraft airframes and engines, rotorcraft, submarines and land vehicles. Sargent manufactures, sells and services hydraulic valves and actuators, specialty bearings, specialty fasteners, seal rings & alignment joints and precision components under leading brands including Kahr Bearing, Airtomic, Sonic Industries, Sargent Controls and Sargent Aerospace & Defense. Annual sales are approximately $195 million and the company has over 750 employees in six facilities in three countries.

· In connection with the Sargent acquisition on April 24, 2015, we entered into the New Credit Agreement and related Guarantee, Pledge Agreement and Security Agreement with Wells Fargo Bank, National Association, as Administrative Agent, Collateral Agent, Swingline Lender and Letter of Credit Issuer and the other lenders party thereto. The New Credit Agreement provides RBCA, as Borrower, with (a) a $200 million Term Loan and (b) a $350 million Revolver and together with the Term Loan (the “Facilities”).

· In the second quarter of fiscal 2015, we reached a decision to consolidate the manufacturing capacity of the United Kingdom (U.K.) facility into our other manufacturing facilities. This decision was based on our intent to better align manufacturing abilities and product development.

· In the third quarter of fiscal 2014, we acquired the net assets of Turbine Components Inc. (“TCI”) for approximately $3,925. Located in San Diego, California, TCI is an FAA certified aircraft gas turbine repair station and manufacturer of precision components for aerospace markets.

Outlook

Our net sales for the three month period ended September 26, 2015 increased 32.1% compared to the same period last fiscal year. Our aerospace markets increased 59.6% and the diversified industrial market decreased 2.4%. Our backlog, as of September 26, 2015, was $347.8 million compared to $218.0 million as of September 27, 2014.

Management believes that operating cash flows and available credit under the credit facilities will provide adequate resources to fund internal and external growth initiatives for the foreseeable future. As of September 26, 2015, we had cash and cash equivalents of $44.1 million of which approximately $29.4 million was cash held by our foreign operations. We expect that our undistributed foreign earnings will be re-invested indefinitely for working capital, internal growth and acquisitions for and by our foreign entities.

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Results of Operations

	Three Months Ended
	September 26, 2015		September 27, 2014		$ Change			% Change
Organic net sales	$	103.2	$	112.6	$	(9.4	)		(8.3	)%
Sales by recent acquisitions		45.5		—		45.5
Total net sales	$	148.7	$	112.6	$	36.1			32.1	%
Net income	$	14.5	$	13.2	$	1.3			9.6	%
Net income per common share: diluted	$	0.62	$	0.57
Weighted average common shares: diluted		23,495,285		23,424,421

Net sales increased $36.1 million or 32.1% for the second quarter of fiscal 2016 over the same period last year. The increase in net sales was mainly the result of a 59.6% increase in aerospace and defense sales offset by a 2.4% decrease in industrial sales. The increase in aerospace and defense sales was mostly attributable to an increase in aerospace aftermarket of 28.0% and aerospace OEM of 66.8%. The decrease in industrial sales was mostly attributable to a decrease in industrial aftermarket of 13.4% offset by an increase in industrial OEM of 3.6%. Overall net sales for the quarter were negatively impacted by $0.9 million due to foreign exchange compared to the same period last year. Excluding the $45.5 million in sales associated with the Sargent acquisition and the foreign exchange impact, industrial sales decreased 12.7% and aerospace and defense sales decreased by 3.5%.

Net income for the second quarter of fiscal 2016 was $14.5 million compared to $13.2 million for the same period last year. Excluding the after tax impact of $0.7 million in costs associated with the acquisition, $2.8 million in inventory purchase accounting associated with the Sargent acquisition, $0.1 million of costs associated with integration and restructuring, $0.1 million of discrete tax expense offset by $0.4 million of favorable foreign exchange translation, net income would have been $17.8 million. Excluding the after tax impact of $3.3 million of costs associated with the consolidation and restructuring of facilities, net income for the second quarter of fiscal 2015 would have been $16.5 million.

	Six Months Ended
	September 26, 2015		September 27, 2014		$ Change			% Change
Organic net sales	$	211.5	$	225.5	$	(14.0	)		(6.2	)%
Sales by recent acquisitions		79.5		—		79.5
Total net sales	$	291.0	$	225.5	$	65.5			29.0	%
Net income	$	27.9	$	29.3	$	(1.4	)		(4.6	)%
Net income per common share: diluted	$	1.19	$	1.25
Weighted average common shares: diluted		23,516,537		23,394,439

Net sales increased $65.5 million or 29.0% for the six month period ended September 26, 2015 over the same period last year. The increase in net sales was mainly the result of a 51.0% increase in aerospace and defense sales and a 1.3% increase in industrial. The increase in aerospace and defense sales was mostly attributable to an increase in aerospace aftermarket of 25.1% and aerospace OEM of 57.0%. The increase in industrial sales was mostly attributable to an increase in industrial OEM of 8.1% offset by a decrease in industrial aftermarket of 10.7%. Overall net sales for the six months were negatively impacted by $1.8 million due to foreign exchange compared to the same period last year. Excluding the $79.5 million in sales associated with the Sargent acquisition and the foreign exchange impact, industrial sales decreased 7.5% and aerospace and defense sales decreased by 3.8%.

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Net income for the six months ended September 26, 2015 was $27.9 million compared to $29.3 million for the same period last year. Excluding the after tax impact of $3.5 million in costs associated with the acquisition, $4.4 million in inventory purchase accounting associated with the Sargent acquisition, $0.7 million of costs associated with integration and restructuring, and offset by $0.2 million of favorable foreign exchange translation, net income would have been $36.3 million. Excluding the after tax impact of $3.2 million of costs associated with the consolidation and restructuring of facilities, net income would have been $32.5 million for the six month period ended September 27, 2014.

Gross Margin

	Three Months Ended
	September 26, 2015			September 27, 2014			$ Change		% Change
Gross Margin	$	52.1		$	39.8		$	12.3		31.1	%
Gross Margin %		35.1	%		35.3	%

Gross margin increased $12.3 million or 31.1% in the second quarter of fiscal 2016 compared to the second quarter of fiscal 2015. Excluding the unfavorable impact of $4.3 million of inventory purchase accounting associated with the Sargent acquisition, gross margin would have been $56.4 million for the second quarter of fiscal 2016. Excluding the impact of the inventory rationalization associated with the consolidation and restructuring of the U.K. facility of $3.7 million, gross margin would have been $43.5 million for the second quarter of fiscal 2015.

	Six Months Ended
	September 26, 2015			September 27, 2014			$ Change		% Change
Gross Margin	$	104.9		$	83.6		$	21.3		25.5	%
Gross Margin %		36.0	%		37.1	%

Gross margin increased $21.3 million or 25.5% for the first six months of fiscal 2016 compared to the same period last year. Excluding the unfavorable impact of $6.6 million of inventory purchase accounting associated with the Sargent acquisition, gross margin would have been $111.5 million. Excluding the impact of the consolidation and restructuring of the U.K. facility of $3.7 million, gross margin would have been $87.3 million for the first six months of fiscal 2015.

Selling, General and Administrative

	Three Months Ended
	September 26, 2015			September 27, 2014			$ Change		% Change
SG&A	$	24.9		$	18.5		$	6.4		34.7	%
% of net sales		16.8	%		16.5	%

SG&A increased as a percentage of net sales to 16.8% in the second quarter of fiscal 2016 from 16.5% in the second quarter of fiscal 2015. SG&A expenses increased by $6.4 million to $24.9 million for the second quarter of fiscal 2016 compared to the same period last year. Excluding the impact of the Sargent acquisition of $4.6 million, the increase was primarily due to higher personnel expenses of $1.1 million, professional expenses of $0.3 million, increase in incentive stock compensation of $0.2 million and $0.2 million of other expenses.

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	Six Months Ended
	September 26, 2015			September 27, 2014			$ Change		% Change
SG&A	$	48.6		$	37.5		$	11.1		29.7	%
% of net sales		16.7	%		16.6	%

SG&A increased as a percentage of net sales to 16.7% for the first six months of fiscal 2016 from 16.6% for the same period last year. SG&A expenses increased by $11.1 million to $48.6 million for the first six months of fiscal 2016 compared to the same period last year. Excluding the impact of the Sargent acquisition of $8.3 million, the increase was primarily due to higher personnel expenses of $1.5 million, increase in incentive stock compensation of $0.6 million, professional expenses of $0.4 million and $0.3 million of other expenses.

Other, Net

	Three Months Ended
	September 26, 2015			September 27, 2014			$ Change		% Change
Other, net	$	3.6		$	2.9		$	0.7		21.7	%
% of net sales		2.4	%		2.6	%

Other operating expenses for the second quarter of fiscal 2016 totaled $3.6 million compared to $2.9 million for the same period last year. For the second quarter of fiscal 2016 other operating expenses were comprised mainly of $2.4 million in amortization of intangibles, $1.1 million of acquisition related costs, $0.2 million in integration and restructuring costs offset by $0.1 million of other income.

	Six Months Ended
	September 26,  2015			September 27,  2014			$  Change		%  Change
Other, net	$	10.3		$	3.6		$	6.7		188.7	%
% of net sales		3.5	%		1.6	%

Other operating expenses for the first six months of fiscal 2016 totaled $10.3 million compared to $3.6 million for the same period last year. For the first six months of fiscal 2016 other operating expenses were comprised mainly of $4.2 million in amortization of intangibles, $5.1 million of acquisition related costs, $1.0 million in integration and restructuring costs.

Interest Expense, Net

	Three Months Ended
	September 26,  2015			September 27,  2014			$  Change		%  Change
Interest expense, net	$	2.3		$	0.3		$	2.0		638.0	%
% of net sales		1.5	%		0.3	%

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Interest expense, net, generally consists of interest charged on our credit facilities and amortization of deferred financing fees, offset by interest income (see “Liquidity and Capital Resources – Liquidity”, below). Interest expense, net was $2.3 million for the second quarter of fiscal 2016 compared to $0.3 million for the same period last year. For the second quarter of fiscal 2016 interest expense, net consisted of interest expense of $1.9 million and deferred debt fees of $0.4 million.

	Six Months Ended
	September 26,  2015			September 27,  2014			$  Change		%  Change
Interest expense, net	$	4.0		$	0.5		$	3.5		648.9	%
% of net sales		1.4	%		0.2	%

Interest expense, net, generally consists of interest charged on our credit facilities and amortization of deferred financing fees, offset by interest income (see “Liquidity and Capital Resources – Liquidity”, below). Interest expense, net was $4.0 million for the first six months of fiscal 2016 compared to $0.5 million for the same period last year. For the first six months of fiscal 2016 interest expense, net consisted of interest expense of $3.4 million and deferred debt fees of $0.6 million.

Income Taxes

	Three Months Ended
	September 26,  2015			September 27,  2014
Income tax expense (benefit)	$	7.4		$	5.0
Effective tax rate with discrete items		33.8	%		27.3	%
Effective tax rate without discrete items		33.5	%		32.9	%

Income tax expense for the three month period ended September 26, 2015 was $7.4 million compared to $5.0 million for the three month period ended September 27, 2014. Our effective income tax rate for the three month period ended September 26, 2015 was 33.8% compared to 27.3% for the three month period ended September 27, 2014. The effective income tax rate for the three month period ended September 26, 2015 of 33.8% includes immaterial discrete expense of $0.1 million. The effective income tax rate without discrete items for the three month period ended September 26, 2015 would have been 33.5%. The effective income tax rate for the three month period ended September 27, 2014 of 27.3% includes discrete benefits of $3.1 million which are comprised substantially of items associated with the consolidation and restructuring of the Company’s U.K. manufacturing facility. The effective income tax rate without discrete items and without other associated consolidated and restructuring expenses pertaining to the Company’s U.K. manufacturing facility for the three month period ended September 27, 2014 would have been 32.9%.

	Six Months Ended
	September 26,  2015			September 27,  2014
Income tax expense (benefit)	$	14.0		$	13.2
Effective tax rate with discrete items		33.5	%		31.1	%
Effective tax rate without discrete items		33.6	%		33.4	%

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Income tax expense for the six month period ended September 26, 2015 was $14.0 million compared to $13.2 million for the six month period ended September 27, 2014. Our effective income tax rate for the six month period ended September 26, 2015 was 33.5% compared to 31.1% for the six month period ended September 27, 2014. The effective income tax rate for the six month period ended September 26, 2015 of 33.5% includes immaterial discrete benefit of $0.1 million. The effective income tax rate without discrete items for the six month period ended September 26, 2015 would have been 33.6%. The effective income tax rate for the six month period ended September 27, 2014 of 31.1% includes discrete benefits in the amount of $3.1 million which are substantially comprised of items associated with the consolidation and restructuring of the Company’s U.K. manufacturing facility. The effective income tax rate without these discrete items and without other associated consolidated and restructuring expenses pertaining to the Company’s U.K. manufacturing facility would have been 33.4%.

Segment Information

We have four reportable product segments: Plain Bearings, Roller Bearings, Ball Bearings and Engineered Products. In fiscal 2016 we integrated the Sargent businesses into our Plain Bearings and Engineered Products segments (see Notes 8 and 10 of Notes to Unaudited Interim Consolidated Financial Statements). We use gross margin as the primary measurement to assess the financial performance of each reportable segment. The presentation of segment net sales includes a reconciliation to adjust for the effects of any acquisitions made in fiscal 2016 and fiscal 2015.

Plain Bearing Segment:

	Three Months Ended
	September 26,  2015			September 27,  2014			$  Change			%  Change
Organic net sales	$	55.3		$	57.5		$	(2.2	)		(3.8	)%
Sales by recent acquisitions		12.3			—			12.3
Total net sales	$	67.6		$	57.5		$	10.1			17.7	%
Gross margin	$	26.8		$	20.8		$	6.0			28.6	%
Gross margin %		39.6	%		36.2	%
SG&A	$	5.9		$	4.6		$	1.3			28.7	%
% of segment net sales		8.7	%		8.0	%

Net sales increased $10.1 million or 17.7% for the three months ended September 26, 2015 compared to the same period last year. The 17.7% increase was primarily driven by a 29.6% increase in aerospace and defense sales and a 8.8% decrease in industrial sales. The 29.6% increase in aerospace and defense sales was primarily due to a 286.8% increase in defense and a 16.5% increase in commercial aerospace. Excluding the $12.3 million impact of acquisition volume from Sargent, the net sales decrease of $2.2 million for this segment was mostly attributable to the unfavorable impacts of decreased volume of $1.7 million and foreign exchange of $0.5 million.

Gross margin increased $6.0 million for the three months ended September 26, 2015 compared to the same period last year. Excluding the $5.8 million impact from the Sargent acquisition, the gross margin increase of $0.2 million was mostly attributable to the favorable impact of cost efficiencies of $1.0 million and offset by unfavorable product mix of $0.7 million and foreign exchange loss of $0.1 million.

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	Six Months Ended
	September 26,  2015			September 27,  2014			$  Change			%  Change
Organic net sales	$	112.7		$	117.3		$	(4.6	)		(3.9	)%
Sales by recent acquisitions		20.6			—			20.6
Total net sales	$	133.3		$	117.3		$	16.0			13.6	%
Gross margin	$	52.7		$	43.3		$	9.4			21.8	%
Gross margin %		39.5	%		36.9	%
SG&A	$	11.4		$	9.3		$	2.1			21.8	%
% of segment net sales		8.5	%		8.0	%

Net sales increased $16.0 million or 13.6% for the six months ended September 26, 2015 compared to the same period last year. The 13.6% increase was primarily driven by a 21.0% increase in aerospace and defense sales and a 3.0% decrease in industrial sales. The 21.0% increase in aerospace and defense sales was primarily due to a 169.0% increase in defense and a 12.2% increase in commercial aerospace. Excluding the $20.6 million impact of acquisition volume from Sargent, the net sales decrease of $4.6 million for this segment was mostly attributable to the unfavorable impacts of volume of $3.5 million and foreign exchange of $1.1 million.

Gross margin increased $9.4 million for the six months ended September 26, 2015 compared to the same period last year. Excluding the $9.6 million impact from the Sargent acquisition, the gross margin decrease of $0.2 million was mostly attributable to the unfavorable impacts of product mix of $1.9 million, foreign exchange of $0.1 million, offset by the favorable impact of increased volume of $1.4 million and cost efficiencies of $0.4 million.

Roller Bearing Segment:

	Three Months Ended
	September 26,  2015			September 27,  2014			$ Change			%  Change
Organic net sales	$	27.2		$	33.5		$	(6.3	)		(19.0	)%
Sales by recent acquisitions		—			—			—
Total net sales	$	27.2		$	33.5		$	(6.3	)		(19.0	)%
Gross margin	$	11.3		$	10.8		$	0.5			5.1	%
Gross margin %		41.8	%		32.2	%
SG&A	$	1.5		$	1.5			—			—
% of segment net sales		5.5	%		4.7	%

Net sales decreased $6.3 million or 19.0% over the second quarter of fiscal 2016. The decrease of 19.0% was primarily due to a 20.0% decrease in industrial sales and a 17.9% decrease in aerospace, mainly defense sales.

The Roller Bearings segment achieved a gross margin of $11.3 million in the three month period ended September 26, 2015 compared to $10.8 million in the comparable period in fiscal 2015. This increase was primarily due to the impact of cost efficiencies of $1.7 million offset by a volume decrease of $1.2 million.

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	Six Months Ended
	September 26,  2015			September 27,  2014			$  Change			%  Change
Organic net sales	$	57.7		$	65.3		$	(7.6	)		(11.5	)%
Sales by recent acquisitions		—			—			—
Total net sales	$	57.7		$	65.3		$	(7.6	)		(11.5	)%
Gross margin	$	24.3		$	23.6		$	0.7			2.8	%
Gross margin %		42.0	%		36.1	%
SG&A	$	3.0		$	3.3		$	(0.3	)		(8.6	)%
% of segment net sales		5.1	%		5.0	%

Net sales decreased $7.6 million or 11.5% over the first six months of fiscal 2016. The decrease of 11.5% was primarily due to an 11.7% decrease in industrial sales and a 11.4% decrease in aerospace and defense sales. The 11.4% decrease in aerospace and defense sales was due to a 8.6% decline in commercial aerospace and a 42.3% decrease in defense. This decrease was attributable to a volume decrease of $7.6 million.

The Roller Bearings segment achieved a gross margin of $24.3 million for the first six months of fiscal 2016 compared to $23.6 million for the comparable period in fiscal 2015. This increase of $0.7 million was primarily due to the unfavorable impacts of product mix of $1.0 million and decreased volume of $2.2 million offset by cost efficiencies of $3.9.

Ball Bearing Segment:

	Three Months Ended
	September 26,  2015			September 27,  2014			$  Change			%  Change
Organic net sales	$	13.1		$	14.1		$	(1.0	)		(6.9	)%
Sales by recent acquisitions		—			—			—
Total net sales	$	13.1		$	14.1		$	(1.0	)		(6.9	)%
Gross margin	$	5.3		$	5.4		$	(0.1	)		(1.3	)%
Gross margin %		40.3	%		38.0	%
SG&A	$	1.3		$	1.3			—			—
% of segment net sales		10.4	%		9.1	%

Net sales decreased $1.0 million or 6.9% for the second quarter of fiscal 2016 compared to the same period last year. The 6.9% decrease was primarily driven by a 4.8% decrease in industrial sales and a 10.5% decrease in aerospace and defense sales. The decrease in industrial sales was primarily due to a decline in oil and gas, and mining activity and the decrease in aerospace was mainly driven by defense.

Gross margin decreased $0.1 million or 1.3% for the second quarter of fiscal 2016 compared to the same period last year. The decrease was primarily due to the unfavorable impact of decreased volume of $0.7 million, offset by the favorable impact of product mix of $0.4 million and cost efficiencies of $0.2 million.

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	Six Months Ended
	September 26,  2015			September 27,  2014			$  Change			%  Change
Organic net sales	$	25.9		$	27.6		$	(1.7	)		(6.1	)%
Sales by recent acquisitions		—			—			—
Total net sales	$	25.9		$	27.6		$	(1.7	)		(6.1	)%
Gross margin	$	10.5		$	10.8		$	(0.3	)		(2.9	)%
Gross margin %		40.4	%		39.0	%
SG&A	$	2.7		$	2.6		$	0.1			5.0	%
% of segment net sales		10.6	%		9.4	%

Net sales decreased $1.7 million or 6.1% for the first six months of fiscal 2016 compared to the same period last year. The 6.1% decrease was primarily driven by a 6.0% decrease in industrial sales and a 6.4% decrease in aerospace and defense sales. The decrease in industrial sales was primarily due to a decline in oil and gas, and mining activity. The decrease in aerospace and defense of 6.4% was primarily impacted by a 7.4% decline in commercial aerospace and offset by a 28.1% increase in defense. These decreases were attributable to decreased volume of $1.7 million.

Gross margin decreased $0.3 million or 2.9% for the first six months of fiscal 2016 compared to the same period last year. The decrease was primarily due to the unfavorable impact of decreased volume of $1.1 million, offset by the favorable impact of product mix of $0.8 million.

Engineered Products Segment:

	Three Months Ended
	September 26,  2015			September 27,  2014			$  Change		%  Change
Organic net sales	$	7.6		$	7.5		$	0.1		1.3	%
Sales by recent acquisitions		33.2			—			33.2
Total net sales	$	40.8		$	7.5		$	33.3		444.2	%
Gross margin	$	8.7		$	2.8		$	5.9		213.8	%
Gross margin %		21.3	%		37.0	%
SG&A	$	4.2		$	0.9		$	3.3		374.0	%
% of segment net sales		10.2	%		11.7	%

Net sales increased $33.3 million or 444.2% for the second quarter of fiscal 2016 compared to the same period last year. The 444.2% increase was primarily driven by a 69.6% increase in industrial sales and a 1,985.8% increase in aerospace and defense sales. Excluding the impact of the Sargent Acquisition commercial aerospace increased 61.0% offset by a 1.1% decline in defense. Excluding the $33.2 million impact of acquisition volume from Sargent, net sales increased $0.1 million. This increase was primarily attributable to the unfavorable impacts of foreign exchange of $0.2 million offset by the favorable impact of volume of $0.3 million.

Gross margin increased $5.9 million or 213.8% for the second quarter of fiscal 2016 compared to the same period last year. Excluding the $6.6 million impact from the Sargent acquisition, the gross margin decrease of $0.7 million was mostly attributable to the unfavorable impacts of product mix of $0.3 million and foreign exchange of $0.1 million and other costs of $0.3 million.

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	Six Months Ended
	September 26,  2015			September 27,  2014			$  Change			%  Change
Organic net sales	$	15.2		$	15.3		$	(0.1	)		(1.3	)%
Sales by recent acquisitions		58.9			—			58.9
Total net sales	$	74.1		$	15.3		$	58.8			383.9	%
Gross margin	$	17.4		$	5.9		$	11.5			195.1	%
Gross margin %		23.6	%		38.6	%
SG&A	$	8.1		$	1.9		$	6.2			336.4	%
% of segment net sales		11.0	%		12.2	%

Net sales increased $58.8 million or 383.9% for the first six months of fiscal 2016 compared to the same period last year. The 383.9% increase was primarily driven by a 60.0% increase in industrial sales and a 1,678.2% increase in aerospace and defense sales. Excluding the impact of the Sargent acquisition commercial aerospace increased 27.3% and defense increased 2.9%. Excluding the $58.9 million impact of acquisition volume from Sargent, net sales decreased $0.1 million. This decrease was primarily attributable to the unfavorable impacts of foreign exchange of $0.2 million, offset by the favorable impact of volume of $0.1 million.

Gross margin increased $11.5 million or 195.1% for the first six months of fiscal 2016 compared to the same period last year. Excluding the $12.3 million impact from the Sargent acquisition, the gross margin decrease of $0.8 million was mostly attributable to the unfavorable impacts of product mix of $0.4 million and foreign exchange of $0.2 million and other costs of $0.3 million, offset by the favorable impact of volume of $0.1 million.

Corporate:

	Three Months Ended
	September 26,  2015			September 27,  2014			$  Change		%  Change
SG&A	$	12.0		$	10.2		$	1.8		17.7	%
% of total net sales		8.1	%		9.1	%

	Six Months Ended
	September 26,  2015			September 27,  2014			$  Change		%  Change
SG&A	$	23.4		$	20.4		$	3.0		14.7	%
% of total net sales		8.1	%		9.1	%

Corporate SG&A increased for both the second quarter and first six months of fiscal 2016 compared to the same periods last year. This was primarily due to unfavorable impacts in stock compensation and headcount – related expenses.

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Liquidity and Capital Resources

Our business is capital intensive. Our capital requirements include manufacturing equipment and materials. In addition, we have historically fueled our growth in part through acquisitions. We have historically met our working capital, capital expenditure requirements and acquisition funding needs through our net cash flows provided by operations, various debt arrangements and sale of equity to investors. We believe that operating cash flows and available credit under the credit facilities will provide adequate resources to fund internal and external growth initiatives for the foreseeable future.

Liquidity

New Credit Facility

In connection with the Sargent acquisition on April 24, 2015, the Company entered into the New Credit Agreement and related Guarantee, Pledge Agreement and Security Agreement with Wells Fargo Bank, National Association, as Administrative Agent, Collateral Agent, Swingline Lender and Letter of Credit Issuer and the other lenders party thereto and terminated the JP Morgan Credit Agreement. The Credit Agreement provides RBCA, as Borrower, with (a) a $200 million Term Loan and (b) a $350 million Revolver and together with the Term Loan (the “Facilities”).

Amounts outstanding under the Facilities generally bear interest at (a) a base rate determined by reference to the higher of (1) Wells Fargo’s prime lending rate, (2) the federal funds effective rate plus 1/2 of 1% and (3) the one-month LIBOR rate plus 1% or (b) LIBOR rate plus a specified margin, depending on the type of borrowing being made. The applicable margin is based on the Company's consolidated ratio of total net debt to consolidated EBITDA from time to time. Currently, our margin is 0.5% for base rate loans and 1.5% for LIBOR rate loans. As of September 26, 2015, there was $205.0 million outstanding under the Revolver and $195.0 million outstanding under the Term Loan, offset by $6.5 million in debt issuance costs (original amount was $7.1 million).

The New Credit Agreement requires us to comply with various covenants, including among other things, financial covenants to maintain the following: (1) a ratio of consolidated net debt to adjusted EBITDA, not to exceed 3.50 to 1; and (2) a consolidated interest coverage ratio not to exceed 2.75 to 1. The New Credit Agreement allows us to, among other things, make distributions to shareholders, repurchase our stock, incur other debt or liens, or acquire or dispose of assets provided that we comply with certain requirements and limitations of the agreement. As of September 26, 2015, we were in compliance with all such covenants.

Our obligations under the New Credit Agreement are secured as well as providing for a pledge of substantially all of our assets. We and certain of our subsidiaries have also entered into a Guarantee to guarantee our obligations under the New Credit Agreement.

Approximately $3.3 million of the Revolver is being utilized to provide letters of credit to secure RBCA’s obligations relating to certain insurance programs, and $225.0 million was utilized to finance the acquisition of Sargent. As of September 26, 2015, RBCA paid down $20.0 million of the Revolver and has the ability to borrow up to an additional $141.7 million under the Revolver.

Prior Credit Facility

On November 30, 2010, we entered into a credit agreement (the “JP Morgan Credit Agreement”) and related security and guaranty agreements with certain banks, J.P. Morgan Chase Bank, N.A., as Administrative Agent, and J.P. Morgan Chase Bank, N.A. and KeyBank National Association as Co-Lead Arrangers and Joint Lead Book Runners. The JP Morgan Credit Agreement provides Roller Bearing Company of America, Inc. (“RBCA”), as borrower, with a $150 million five-year senior secured revolving credit facility which can be increased by up to $100 million, in increments of $25 million, under certain circumstances and subject to certain conditions (including the receipt from one or more lenders of the additional commitment).

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Amounts outstanding under the JP Morgan Credit Agreement generally bear interest at the prime rate or LIBOR plus a specified margin, depending on the type of borrowing being made. The applicable margin is based upon our consolidated ratio of net debt to adjusted EBITDA, measured at the end of each quarter. As of September 27, 2014, our margin is 0.5% for prime rate loans and 1.5% for LIBOR rate loans.

The JP Morgan Credit Agreement requires us to comply with various covenants, including among other things, financial covenants to maintain the following: (1) a ratio of consolidated net debt to adjusted EBITDA, not to exceed 3.25 to 1; and (2) a consolidated fixed charge coverage ratio not to exceed 1.5 to 1. The credit agreement allows us to, among other things, make distributions to shareholders, repurchase our stock, incur other debt or liens, or acquire or dispose of assets provided that we comply with certain requirements and limitations of the agreement. The JP Morgan Credit Agreement was terminated and replaced by the New Credit Agreement discussed above.

Other Notes Payable

On October 1, 2012, Schaublin purchased the land and building, which it occupied and had been leasing, for 14.1 million CHF (approximately $14.9 million). Schaublin obtained a 20 year fixed rate mortgage of 9.3 million CHF (approximately $9.9 million) at an interest rate of 2.9%. The balance of the purchase price of 4.8 million CHF (approximately $5.1 million) was paid from cash on hand. The balance on this mortgage as of September 26, 2015 was 7.9 million CHF, or $8.1 million.

Our ability to meet future working capital, capital expenditures and debt service requirements will depend on our future financial performance, which will be affected by a range of economic, competitive and business factors, particularly interest rates, cyclical changes in our end markets and prices for steel and our ability to pass through price increases on a timely basis, many of which are outside of our control. In addition, future acquisitions could have a significant impact on our liquidity position and our need for additional funds.

From time to time we evaluate our existing facilities and operations and their strategic importance to us. If we determine that a given facility or operation does not have future strategic importance, we may sell, partially or completely, relocate production lines, consolidate or otherwise dispose of those operations. Although we believe our operations would not be materially impaired by such dispositions, relocations or consolidations, we could incur significant cash or non-cash charges in connection with them.

On May 16, 2014, our Board declared a special dividend to shareholders of $2.00 per common share or a total of approximately $46.0 million. The special dividend was paid on June 13, 2014, to shareholders of record on May 30, 2014. The ex-dividend date was May 28, 2014. The Board opted for a special dividend payment, rather than a regular recurring dividend to allow greater flexibility given our pipeline of attractive growth opportunities. The Board, will however, consider the use of additional special cash dividends in the future as circumstance warrant.

As of September 26, 2015, we had cash and cash equivalents of $44.1 million of which approximately $29.4 million was cash held by our foreign operations. We expect that our undistributed foreign earnings will be re-invested indefinitely for working capital, internal growth and acquisitions for and by our foreign entities.

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Cash Flows

Six Month Period Ended September 26, 2015 Compared to the Six Month Period Ended September 27, 2014

The following table summarizes our cash flow activities:

	FY16			FY15			$ Change
Net cash provided by (used in):
Operating activities	$	40.3		$	44.7		$	(4.4	)
Investing activities		(509.8	)		(8.5	)		(501.3	)
Financing activities		388.4			(45.3	)		433.7
Effect of exchange rate changes on cash		(0.3	)		(2.7	)		2.4
Decrease in cash and cash equivalents	$	(81.4	)	$	(11.8	)	$	(69.6	)

During fiscal 2016 we generated cash of $40.3 million from operating activities compared to generating cash of $44.7 million for fiscal 2015. The decrease of $4.4 million for fiscal 2016 was mainly a result of the addition of non-cash charges of $1.8 million offset by the unfavorable impacts of a net change in operating assets and liabilities of $4.9 million and a decrease in net income of $1.3 million. The favorable impact of the non-cash charges of $1.8 was primarily due increased amortization of intangibles of $3.2 million and impairment charges of $5.0 million in the second quarter of fiscal 2015 related to the consolidation of the U.K. facility. The unfavorable change in operating assets and liabilities was primarily the result of a increase in the amount of cash being used for working capital items.

The following chart summarizes the favorable (unfavorable) change in operating assets and liabilities of ($4.9) million for fiscal 2016 versus fiscal 2015 and $18.4 million for fiscal 2015 versus fiscal 2014.

	FY16			FY15
Cash provided by (used in):
Accounts receivable	$	1.2		$	5.0
Inventory		(3.2	)		6.6
Prepaid expenses and other current assets		(1.3	)		(1.2	)
Other non-current assets		0.7			0.7
Accounts payable		(0.6	)		0.5
Accrued expenses and other current liabilities		(6.7	)		7.1
Other non-current liabilities		5.0			(0.3	)
Total change in operating assets and liabilities:	$	(4.9	)	$	18.4

During fiscal 2016, we used $509.8 million for investing activities as compared to $8.5 for fiscal 2015. The increase of cash used in investing activities of $501.3 million is primarily attributable to the $500.0 million used to finance the acquisition of Sargent.

During fiscal 2016, we generated $388.4 million from financing activities compared to using $45.3 million for fiscal 2015. This increase in cash generated was primarily attributable to the $225.0 million revolving credit facility and $200.0 million proceeds from the term loan associated with the acquisition of Sargent in the first quarter of fiscal 2016.

Capital Expenditures

Our capital expenditures were $9.8 million for the six month period ended September 26, 2015. In addition, we expect to make additional capital expenditures of $10.0 to $12.0 million during fiscal 2016 in connection with our existing business. We expect to fund fiscal 2016 capital expenditures principally through existing cash, internally generated funds and debt. We may also make substantial additional capital expenditures in connection with acquisitions.

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Obligations and Commitments

The contractual obligations presented in the table below represent our estimates of future payments under fixed contractual obligations and commitments. Changes in our business needs, cancellation provisions and interest rates, as well as actions by third parties and other factors, may cause these estimates to change. Because these estimates are necessarily subjective, our actual payments in future periods are likely to vary from those presented in the table. The following table summarizes certain of our contractual obligations and principal and interest payments under our debt instruments and leases as of September 26, 2015:

	Payments Due By Period
Contractual Obligations(1)	Total		Less than 1 Year		1 to 3 Years		3 to 5 Years		More than 5 Years
	(in thousands)
Total debt	$	402,298	$	7,301	$	25,601	$	363,695	$	5,701
Operating leases		13,571		5,482		5,420		1,976		693
Interest on fixed rate debt		2,134		235		429		375		1,095
Interest on variable rate debt(2)		29,715		6,686		12,809		10,220		—
Pension and postretirement benefits		19,467		1,819		3,846		3,983		9,819
Total contractual cash obligations	$	467,185	$	21,523	$	48,105	$	380,249	$	17,308

(1) We cannot make a reasonably reliable estimate of when (or if) the unrecognized tax liability of $5.7 million, which includes interest and penalties, will be paid to the respective taxing authorities. These obligations are therefore excluded from the above table.

(2) These amounts represent expected cash payments of interest on our variable rate long-term debt under our Facilities at the prevailing interest rates at September 26, 2015.

Other Matters

Critical Accounting Estimates

Preparation of our financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. We believe the most complex and sensitive judgments, because of their significance to the Consolidated Financial Statements, result primarily from the need to make estimates about the effects of matters that are inherently uncertain. Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Notes to the Consolidated Financial Statements in our fiscal 2015 Annual Report, incorporated by reference in our fiscal 2015 Form 10-K, describe the significant accounting estimates and policies used in preparation of the Consolidated Financial Statements. Actual results in these areas could differ from management’s estimates. There have been no significant changes in our critical accounting estimates during the first six months of fiscal 2016.

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ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to market risks, which arise during the normal course of business from changes in interest rates and foreign currency exchange rates.

Interest Rates. We currently have variable rate debt outstanding under the credit agreement. We regularly evaluate the impact of interest rate changes on our net income and cash flow and take action to limit our exposure when appropriate.

Foreign Currency Exchange Rates. As a result of our operations in Europe, we are exposed to risk associated with fluctuating currency exchange rates between the U.S. dollar, the Euro, the Swiss Franc, the Polish Zloty and the Canadian Dollar. Our Swiss operations utilize the Swiss Franc as the functional currency, our French operations utilize the Euro as the functional currency, our Polish operations utilize the Polish Zloty as the functional currency and our Canadian operations utilize the Canadian Dollar as the functional currency. Foreign currency transaction gains and losses are included in earnings. Approximately 11% and 14% of our net sales were impacted by foreign currency fluctuations in the first six months of fiscal 2016 and fiscal 2015, respectively. We expect that this proportion is likely to increase as we seek to increase our penetration of foreign markets, particularly within the aerospace and defense markets. Foreign currency transaction exposure arises primarily from the transfer of foreign currency from one subsidiary to another within the group, and to foreign currency denominated trade receivables. Unrealized currency translation gains and losses are recognized upon translation of the foreign subsidiaries’ balance sheets to U.S. dollars. Because our financial statements are denominated in U.S. dollars, changes in currency exchange rates between the U.S. dollar and other currencies have had, and will continue to have, an impact on our earnings. We periodically enter into derivative financial instruments in the form of forward exchange contracts to reduce the effect of fluctuations in exchange rates on certain third-party sales transactions denominated in non-functional currencies. Based on the accounting guidance related to derivatives and hedging activities, we record derivative financial instruments at fair value. For derivative financial instruments designated and qualifying as cash flow hedges, the effective portion of the gain or loss on these hedges is reported as a component of accumulated other comprehensive income (“AOCI”), and is reclassified into earnings when the hedged transaction affects earnings. As of September 26, 2015, we had no derivatives.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

ITEM 4. Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)) as of September 26, 2015. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of September 26, 2015, our disclosure controls and procedures were (1) designed to ensure that information relating to our Company required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported to our Chief Executive Officer and Chief Financial Officer within the time periods specified in the rules and forms of the U.S. Securities and Exchange Commission, and (2) effective, in that they 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.

Changes in Internal Control over Financial Reporting

No change in our internal control over financial reporting occurred during the six month period ended September 26, 2015 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act).

33

PART II - OTHER INFORMATION

ITEM 1. Legal Proceedings

From time to time, we are involved in litigation and administrative proceedings which arise in the ordinary course of our business. We do not believe that any litigation or proceeding in which we are currently involved, either individually or in the aggregate, is likely to have a material adverse effect on our business, financial condition, operating results, cash flow or prospects.

Our wholly owned subsidiary, RBC Aircraft Products, Inc. is a plaintiff in a lawsuit against Precise Machining & Manufacturing LLC currently pending in the United States District Court, District of Connecticut’s Case Number 3:10 CV 878 (SRU). A jury award against Precise Machining & Manufacturing LLC and in favor of RBC Aircraft Products, Inc. in the amount of $2,986,089 was entered on April 9, 2013. Precise Machining & Manufacturing LLC subsequently filed a motion for judgment in its favor as a matter of law and a motion for a new trial. On May 5, 2014 the presiding judge surprisingly overturned the jury verdict and granted a motion for a new trial. RBC Aircraft Products, Inc. subsequently filed a motion for Certification of Judgment, which was unopposed by Precise Machining & Manufacturing LLC, which was granted on July 28, 2014 and allows RBC Aircraft Products, Inc. to immediately appeal the judges’ decision to overturn the jury verdict to the Second Circuit Court of Appeals. The overturning of a jury verdict is highly unusual and RBC Aircraft Products, Inc. believes there is no credible support for doing so in this matter and expects to be successful with its appeal.

We expect to prevail in this appeal above; however, as litigation is inherently unpredictable, there can be no assurance in this regard. Any monetary recovery from this lawsuit will be recognized only if and when it is received by the Company.

ITEM 1A. Risk Factors

There have been no material changes to our risk factors and uncertainties during the six month period ended September 26, 2015. For a discussion of the Risk Factors, refer to Part I, Item 2, “Cautionary Statement As To Forward-Looking Information,” contained in this report and Part I, Item 1A, “Risk Factors,” contained in the Company’s Annual Report on Form 10-K for the period ended March 28, 2015.

34

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

Unregistered Sales of Equity Securities

None.

Use of Proceeds

Not applicable.

Issuer Purchases of Equity Securities

On February 7, 2013, our board of directors authorized us to repurchase up to $50.0 million of our common stock, from time to time on the open market, in block trade transactions and through privately negotiated transactions in compliance with Securities and Exchange Commission Rule 10b-18 depending on market conditions, alternative uses of capital and other relevant factors. Purchases may be commenced, suspended, or discontinued at any time without prior notice.

Total share repurchases for the three months ended September 26, 2015 are as follows:

Period	Total  number of shares Purchased		Average price paid per share		Number of shares purchased  as part of the publicly announced program		Approximate dollar value of shares still available to be purchased under the program (000’s)
06/28/2015 – 07/25/2015		9,591	$	71.73		9,591	$	38,211
07/26/2015 – 08/22/2015		—		—		—		38,211
08/23/2015 – 09/26/2015		80,324		60.11		80,324	$	33,382
Total		89,915	$	61.35		89,915

ITEM 3. Defaults Upon Senior Securities

Not applicable.

ITEM 4. Mine Safety Disclosures

Not applicable.

ITEM 5. Other Information

Not applicable.

35

ITEM 6. Exhibits

Exhibit Number	Exhibit Description
31.01	Certification of Chief Executive Officer Pursuant to Securities Exchange Act Rule 13a-14(a).
31.02	Certification of Chief Financial Officer Pursuant to Securities Exchange Act Rule 13a-14(a).
32.01	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 and Securities Exchange Act Rule 13a-14(b).*
32.02	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 and Securities Exchange Act Rule 13a-14(b).*
101.INS	X BRL 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.

*           This certification accompanies this Quarterly Report on Form 10-Q, is not deemed filed with the SEC and is not to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of this Quarterly Report on Form 10-Q), irrespective of any general incorporation language contained in such filing.

36

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

RBC Bearings Incorporated
	(Registrant)
By:	/s/ Michael J. Hartnett
	Name:	Michael J. Hartnett
	Title:	Chief Executive Officer
	Date:	November 5, 2015
By:	/s/ Daniel A. Bergeron
	Name:	Daniel A. Bergeron
	Title:	Chief Financial Officer
	Date:	November 5, 2015

37

EXHIBIT INDEX

Exhibit Number	Exhibit Description
31.01	Certification of Chief Executive Officer Pursuant to Securities Exchange Act Rule 13a-14(a).
31.02	Certification of Chief Financial Officer Pursuant to Securities Exchange Act Rule 13a-14(a).
32.01	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 and Securities Exchange Act Rule 13a-14(b).*
32.02	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 and Securities Exchange Act Rule 13a-14(b).*
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.

*           This certification accompanies this Quarterly Report on Form 10-Q, is not deemed filed with the SEC and is not to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of this Quarterly Report on Form 10-Q), irrespective of any general incorporation language contained in such filing.

38

EX-31.01

Exhibit 31.01

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Michael J. Hartnett, certify that:

1. I have reviewed this quarterly report on Form 10-Q of RBC Bearings Incorporated;

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 any 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; and

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 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.

Date: November 5, 2015	By:	/s/ Michael J. Hartnett
		Michael J. Hartnett
		President and Chief Executive Officer

EX-31.02

Exhibit 31.02

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Daniel A. Bergeron, certify that:

1. I have reviewed this quarterly report on Form 10-Q of RBC Bearings Incorporated;

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 any 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; and

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 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.

Date: November 5, 2015	By:	/s/ Daniel A. Bergeron
		Daniel A. Bergeron
		Chief Financial Officer

EX-32.01

Exhibit 32.01

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO

18 U.S.C SECTION 1350

The undersigned, Michael J. Hartnett, the President and Chief Executive Officer of RBC Bearings Incorporated (the “Company”), pursuant to 18 U.S.C. §1350, hereby certifies that:

(i) the Quarterly Report on Form 10-Q for the period ended September 26, 2015 of the Company (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated:  November 5, 2015

/s/ Michael J. Hartnett

Michael J. Hartnett

President and Chief Executive Officer

EX-32.02

Exhibit 32.02

CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO
18 U.S.C. SECTION 1350

The undersigned, Daniel A. Bergeron, Chief Financial Officer, of RBC Bearings Incorporated (the “Company”), pursuant to 18 U.S.C. §1350, hereby certifies:

(i) the Quarterly Report on Form 10-Q for the period ended September 26, 2015 of the Company (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: November 5, 2015

/s/ Daniel A. Bergeron

Daniel A. Bergeron

Chief Financial Officer

XML

Acquisitions (Details) - USD ($) $ in Thousands	Sep. 26, 2015	Apr. 24, 2015	Mar. 28, 2015
Business Acquisition [Line Items]
Goodwill	$ 269,901		$ 43,439
Sargent [Member]
Business Acquisition [Line Items]
Current assets		$ 3,086
Trade receivables		23,892
Inventories		47,709
Property, plant and equipment		41,538
Intangible assets		201,000
Goodwill		226,481
Total assets acquired		543,706
Accounts payable		14,900
Liabilities assumed		28,806
Net assets acquired		$ 500,000

XML

Goodwill and Intangible Assets (Details Textual) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 26, 2015	Sep. 27, 2014	Sep. 26, 2015	Sep. 27, 2014
Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets	$ 2,402	$ 467	$ 4,170	$ 964

XML

Acquisitions (Tables)

6 Months Ended

Sep. 26, 2015

Business Combinations [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The preliminary purchase price allocation for Sargent was as follows:

	As of April 24, 2015
Current assets	$	3,086
Trade receivables		23,892
Inventories		47,709
Property, plant and equipment		41,538
Intangible assets		201,000
Goodwill		226,481
Total assets acquired		543,706
Accounts payable		14,900
Liabilities assumed		28,806
Net assets acquired	$	500,000

Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination

The components of intangible assets included as part of the Sargent acquisition was as follows:

	Weighted Average Amortization Period (Years)	Gross Value
Amortizable intangible assets
Customer relationships	25	$	101,800
Product approvals	25		50,500
Trademarks and tradenames	10		18,000
			170,300
Non-amortizable intangible assets
Repair station certifications	-		30,700
Intangible assets		$	201,000

Business Acquisition, Pro Forma Information

The pro forma financial information is presented for illustrative purposes only and is not necessarily indicative of the operating results that would have been achieved had the acquisition been completed as of the date indicated or the results that may be obtained in the future:

	Three Months Ended				Six Months Ended
	September 26, 2015		September 27, 2014		September 26, 2015		September 27, 2014
Pro forma net sales	$	148,696	$	162,145	$	299,378	$	325,355
Pro forma net income		18,058		14,170		34,723		30,856
Basic earnings per share as reported	$	0.63	$	0.57	$	1.20	$	1.27
Pro forma basic earnings per share		0.78		0.61		1.50		1.34
Diluted earnings per share as reported	$	0.62	$	0.57	$	1.19	$	1.25
Pro forma diluted earnings per share		0.77		0.60		1.48		1.32

XML

Acquisitions (Details Textual) - USD ($) $ in Thousands			3 Months Ended		6 Months Ended
	Oct. 07, 2013	Aug. 16, 2013	Sep. 26, 2015	Sep. 27, 2014	Sep. 26, 2015	Sep. 27, 2014	Apr. 24, 2015	Mar. 28, 2015
Business Acquisition [Line Items]
Revenue, Net, Total			$ 148,696	$ 112,555	$ 291,004	$ 225,539
Net income			14,519	$ 13,248	27,923	$ 29,268
Goodwill			269,901		269,901			$ 43,439
Climax Metal Products Company [Member]
Business Acquisition [Line Items]
Business acquisition purchases price allocation assets acquired		$ 13,646
Cash paid for purchase price		10,672
Business acquisition purchase price allocation notes payable and long term debts		2,974
Revenue, Net, Total		14,100
Business acquisition purchase price allocation current assets receivable		1,206
Business acquisition purchases price allocation current assets inventory		4,509
Business acquisitions purchases price allocation other assets		73
Business acquisition purchases price allocation noncurrent assets		2,466
Business acquisition purchases price allocation intangible assets other than goodwill		3,904
Business acquisition purchases price allocation other noncurrent assets		10
Business acquisition purchases price allocation current liabilities other liabilities		2,171
Business acquisition purchases price allocation noncurrent liabilities		1,974
Business Acquisition Purchases Price Allocation Goodwill After Tax		5,623
Goodwill		$ 5,623
Turbine Components Inc [Member]
Business Acquisition [Line Items]
Revenue, Net, Total	$ 4,000
Business acquisition purchase price allocation current assets receivable	585
Business acquisition purchases price allocation current assets inventory	125
Business acquisition purchases price allocation noncurrent assets	1,231
Business acquisition purchases price allocation intangible assets other than goodwill	441
Business acquisition purchases price allocation other noncurrent assets	127
Business acquisition purchases price allocation current liabilities other liabilities	641
Business acquisition purchases price allocation noncurrent liabilities	766
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets	3,925
Business Combination, Contingent Consideration, Liability	469
Business Acquisition Purchases Price Allocation Goodwill Before Tax	2,821
Goodwill	$ 2,821
Sargent [Member]
Business Acquisition [Line Items]
Revenue, Net, Total			45,507		79,509
Business acquisition purchase price allocation current assets receivable							$ 23,892
Business acquisition purchases price allocation current assets inventory							47,709
Business acquisition purchases price allocation intangible assets other than goodwill							201,000
Business acquisition purchases price allocation noncurrent liabilities							28,806
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets							543,706
Net income			1,407		5,232
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net							500,000
Acquisition Costs, Period Cost			$ 1,283		$ 6,071
Goodwill							226,481
Sargent [Member] | Fair Value, Inputs, Level 3 [Member]
Business Acquisition [Line Items]
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net							$ 500,000

XML

Reportable Segments (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 26, 2015	Sep. 27, 2014	Sep. 26, 2015	Sep. 27, 2014
Segment Reporting Information [Line Items]
Net External Sales	$ 148,696	$ 112,555	$ 291,004	$ 225,539
Gross Margin	52,118	39,751	104,882	83,572
Selling, General & Administrative Expenses	24,944	18,517	48,669	37,513
Operating Income	23,599	18,297	45,960	42,508
Geographic External Sales	148,696	112,555	291,004	225,539
Intersegment Sales	13,668	14,643	28,992	28,345
Plain [Member]
Segment Reporting Information [Line Items]
Net External Sales	67,607	57,458	133,284	117,331
Gross Margin	26,763	20,817	52,711	43,284
Selling, General & Administrative Expenses	5,906	4,588	11,389	9,350
Operating Income	20,784	15,950	41,089	33,503
Intersegment Sales	977	1,041	2,116	2,020
Roller [Member]
Segment Reporting Information [Line Items]
Net External Sales	27,151	33,504	57,731	65,269
Gross Margin	11,355	10,799	24,250	23,590
Selling, General & Administrative Expenses	1,483	1,566	2,973	3,251
Operating Income	9,724	6,497	21,064	17,449
Intersegment Sales	5,182	5,056	10,695	10,039
Ball [Member]
Segment Reporting Information [Line Items]
Net External Sales	13,122	14,093	25,941	27,638
Gross Margin	5,292	5,360	10,475	10,787
Selling, General & Administrative Expenses	1,370	1,279	2,738	2,607
Operating Income	3,775	3,914	7,447	7,867
Intersegment Sales	486	706	1,047	1,258
Engineered Products [Member]
Segment Reporting Information [Line Items]
Net External Sales	40,816	7,500	74,048	15,301
Gross Margin	8,708	2,775	17,446	5,911
Selling, General & Administrative Expenses	4,176	881	8,122	1,861
Operating Income	2,303	1,909	4,863	4,034
Intersegment Sales	7,023	7,840	15,134	15,028
Corporate [Member]
Segment Reporting Information [Line Items]
Selling, General & Administrative Expenses	12,009	10,203	23,447	20,444
Operating Income	(12,987)	(9,973)	(28,503)	(20,345)
Domestic [Member]
Segment Reporting Information [Line Items]
Geographic External Sales	130,521	93,387	253,501	188,433
Foreign [Member]
Segment Reporting Information [Line Items]
Geographic External Sales	$ 18,175	$ 19,168	$ 37,503	$ 37,106

XML

Net Income Per Common Share

6 Months Ended

Sep. 26, 2015

Earnings Per Share [Abstract]

Net Income Per Common Share

2. Net Income Per Common Share

Basic net income per common share is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding.

Diluted net income per common share is computed by dividing net income by the sum of the weighted-average number of common shares and dilutive common share equivalents then outstanding using the treasury stock method. Common share equivalents consist of the incremental common shares issuable upon the exercise of stock options.

The table below reflects the calculation of weighted-average shares outstanding for each period presented as well as the computation of basic and diluted net income per common share:

	Three Months Ended				Six Months Ended
	September 26,		September 27,		September 26,		September 27,
	2015		2014		2015		2014
Net income	$	14,519	$	13,248	$	27,923	$	29,268
Denominator for basic net income per common share—weighted-average shares outstanding		23,210,640		23,134,902		23,186,600		23,070,170
Effect of dilution due to employee stock awards		284,645		289,519		329,937		324,269
Denominator for diluted net income per common share — weighted-average shares outstanding		23,495,285		23,424,421		23,516,537		23,394,439
Basic net income per common share	$	0.63	$	0.57	$	1.20	$	1.27
Diluted net income per common share	$	0.62	$	0.57	$	1.19	$	1.25

At September 26, 2015, 408,000 employee stock options and 73,850 restricted shares have been excluded from the calculation of diluted earnings per share. At September 27, 2014, 419,650 employee stock options and 800 restricted shares have been excluded from the calculation of diluted earnings per share. The inclusion of these employee stock options would be anti-dilutive.

XML

Inventory (Details) - USD ($) $ in Thousands	Sep. 26, 2015	Mar. 28, 2015
Inventory [Line Items]
Raw materials	$ 29,361	$ 18,424
Work in process	76,514	50,243
Finished goods	157,008	137,491
Inventory, total	$ 262,883	$ 206,158

XML

Net Income Per Common Share (Details Textual) - shares	6 Months Ended
	Sep. 26, 2015	Sep. 27, 2014
Employee Stock Option [Member]
Net Income Loss Per Common Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	408,000	419,650
Restricted Stock [Member]
Net Income Loss Per Common Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	73,850	800

XML

Goodwill and Intangible Assets (Details) $ in Thousands	6 Months Ended
	Sep. 26, 2015 USD ($)
Goodwill [Line Items]
Goodwill Beginnning Balance	$ 43,439
Acquisitions	226,481
Other	(19)
Goodwill Ending Balance	269,901
Roller [Member]
Goodwill [Line Items]
Goodwill Beginnning Balance	16,007
Acquisitions	0
Other	0
Goodwill Ending Balance	16,007
Plain [Member]
Goodwill [Line Items]
Goodwill Beginnning Balance	20,641
Acquisitions	57,479
Other	0
Goodwill Ending Balance	78,120
Ball [Member]
Goodwill [Line Items]
Goodwill Beginnning Balance	5,623
Acquisitions	0
Other	0
Goodwill Ending Balance	5,623
Engineered Products [Member]
Goodwill [Line Items]
Goodwill Beginnning Balance	1,168
Acquisitions	169,002
Other	(19)
Goodwill Ending Balance	$ 170,151

XML

Goodwill and Intangible Assets (Details 1) - USD ($) $ in Thousands	6 Months Ended
	Sep. 26, 2015	Mar. 28, 2015
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 195,208	$ 25,213
Accumulated Amortization	17,355	13,185
Non-amortizable repair station certifications	30,700	0
Total	$ 225,908	25,213
Product approvals [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Lives	24 years
Gross Carrying Amount	$ 54,285	4,068
Accumulated Amortization	$ 3,349	2,372
Customer relationships and lists [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Lives	24 years
Gross Carrying Amount	$ 110,696	9,017
Accumulated Amortization	$ 6,348	4,349
Trade names [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Lives	10 years
Gross Carrying Amount	$ 19,990	2,102
Accumulated Amortization	$ 2,219	1,372
Distributor agreements [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Lives	5 years
Gross Carrying Amount	$ 722	722
Accumulated Amortization	$ 722	722
Patents and trademarks [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Lives	15 years
Gross Carrying Amount	$ 7,881	7,670
Accumulated Amortization	$ 3,345	3,039
Domain names [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Lives	10 years
Gross Carrying Amount	$ 437	437
Accumulated Amortization	$ 320	299
Other [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Lives	5 years
Gross Carrying Amount	$ 1,197	1,197
Accumulated Amortization	$ 1,052	$ 1,032

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Accumulated Other Comprehensive Income (Loss)

6 Months Ended

Sep. 26, 2015

Accumulated Other Comprehensive Income Loss [Abstract]

Accumulated Other Comprehensive Income (Loss)

1. Accumulated Other Comprehensive Income (Loss)

The components of comprehensive income (loss) that relate to the Company are net income, foreign currency translation adjustments and pension plan and postretirement benefits, all of which are presented in the consolidated statements of stockholders' equity and comprehensive income (loss).

The following summarizes the activity within each component of accumulated other comprehensive income (loss):

	Currency Translation		Pension and Postretirement Liability		Total
Balance at March 28, 2015	$	(93)	$	(7,677)	$	(7,770)
Other comprehensive income (loss) before reclassifications (net of taxes)		(1,675)		(373)		(2,048)
Amounts reclassified from accumulated other comprehensive income (loss)		—		(82)		(82)
Net current period other comprehensive income (loss)		(1,675)		(455)		(2,130)
Balance at September 26, 2015	$	(1,768)	$	(8,132)	$	(9,900)

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Goodwill and Intangible Assets (Details 2) $ in Thousands	Sep. 26, 2015 USD ($)
Finite-Lived Intangible Assets [Line Items]
2016	$ 4,814
2017	9,562
2018	9,439
2019	9,216
2020	9,108
2021	9,058
2022 and thereafter	$ 126,656

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Acquisitions (Details 1) - Sargent [Member] $ in Thousands	1 Months Ended
	Apr. 24, 2015 USD ($)
Amortizable intangible assets
Gross Value	$ 170,300
Weighted Average Amortization Period (Years)	0 years
Non-amortizable intangible assets
Repair station certifications	$ 30,700
Intangible assets	201,000
Product Approvals [Member]
Amortizable intangible assets
Gross Value	$ 50,500
Weighted Average Amortization Period (Years)	25 years
Trademarks and Trade Names [Member]
Amortizable intangible assets
Gross Value	$ 18,000
Weighted Average Amortization Period (Years)	10 years
Customer Relationships [Member]
Amortizable intangible assets
Gross Value	$ 101,800
Weighted Average Amortization Period (Years)	25 years

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Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 26, 2015	Mar. 28, 2015
Current assets:
Cash and cash equivalents	$ 44,077	$ 125,455
Accounts receivable, net of allowance for doubtful accounts of $1,643 at September 26, 2015 and $860 at March 28, 2015	97,132	76,651
Inventory	262,883	206,158
Deferred income taxes	11,336	12,492
Prepaid expenses and other current assets	9,306	4,628
Total current assets	424,734	425,384
Property, plant and equipment, net	184,102	141,649
Goodwill	269,901	43,439
Intangible assets, net of accumulated amortization of $17,355 at September 26, 2015 and $13,185 at March 28, 2015	208,553	12,028
Other assets	9,169	9,573
Total assets	1,096,459	632,073
Current liabilities:
Accounts payable	37,092	23,459
Accrued expenses and other current liabilities	30,311	17,326
Current portion of long-term debt	8,725	1,233
Total current liabilities	76,128	42,018
Deferred income taxes	22,355	10,126
Long-term debt, less current portion	393,573	7,965
Other non-current liabilities	28,728	22,531
Total liabilities	520,784	82,640
Stockholders’ equity:
Preferred stock, $.01 par value; authorized shares: 10,000,000 at September 26, 2015 and March 28, 2015; none issued and outstanding	0	0
Common stock, $.01 par value; authorized shares: 60,000,000 at September 26, 2015 and March 28, 2015; issued and outstanding shares: 23,989,656 at September 26, 2015 and 23,833,185 at March 28, 2015	240	238
Additional paid-in capital	270,236	262,091
Accumulated other comprehensive loss	(9,900)	(7,770)
Retained earnings	342,099	314,176
Treasury stock, at cost, 559,856 shares at September 26, 2015 and 439,864 shares at March 28, 2015	(27,000)	(19,302)
Total stockholders’ equity	575,675	549,433
Total liabilities and stockholders’ equity	$ 1,096,459	$ 632,073

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Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Sep. 26, 2015	Sep. 27, 2014
Cash flows from operating activities:
Net income	$ 27,923	$ 29,268
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	8,302	7,103
Excess tax benefits from stock-based compensation	(1,682)	(2,778)
Deferred income taxes	791	218
Amortization of intangible assets	4,170	964
Amortization of deferred financing costs	621	163
Consolidation and restructuring charges	0	5,026
Stock-based compensation	4,628	4,035
Other non-cash charges	232	500
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	4,068	2,848
Inventory	(9,481)	(6,291)
Prepaid expenses and other current assets	(3,946)	(2,669)
Other non-current assets	(20)	(670)
Accounts payable	(1,206)	(560)
Accrued expenses and other current liabilities	769	7,451
Other non-current liabilities	5,091	120
Net cash provided by operating activities	40,260	44,728
Cash flows from investing activities:
Purchase of property, plant and equipment	(9,799)	(11,458)
Proceeds from sale of short-term investments	0	2,380
Proceeds from sale of assets	40	593
Business acquisition	(500,000)	0
Net cash used in investing activities	(509,759)	(8,485)
Cash flows from financing activities:
Proceeds from revolving credit facility	225,000	0
Repayments of revolving credit facility	(20,000)	0
Proceeds from term loans	200,000	0
Repayments of term loans	(5,245)	(259)
Finance fees paid in connection with credit facility	(7,122)	0
Exercise of stock options	1,837	2,992
Excess tax benefits from stock-based compensation	1,682	2,778
Repurchase of common stock	(7,698)	(4,721)
Dividends paid to shareholders	0	(46,014)
Other, net	0	(101)
Net cash provided by (used in) financing activities	388,454	(45,325)
Effect of exchange rate changes on cash	(333)	(2,678)
Cash and cash equivalents:
Decrease during the period	(81,378)	(11,760)
Cash, at beginning of period	125,455	121,207
Cash, at end of period	$ 44,077	$ 109,447

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Debt (Details Textual) SFr in Thousands, $ in Thousands	1 Months Ended				6 Months Ended
	Apr. 24, 2015 USD ($)	Oct. 01, 2012 USD ($)	Oct. 01, 2012 CHF (SFr)	Nov. 30, 2010 USD ($)	Sep. 26, 2015 USD ($)	Sep. 27, 2014 USD ($)	Sep. 26, 2015 CHF (SFr)	Mar. 28, 2015 USD ($)	Oct. 01, 2012 CHF (SFr)
Schedule of Trading Securities and Other Trading Assets [Line Items]
Proceeds from Lines of Credit					$ 225,000	$ 0
Line of Credit Facility, Remaining Borrowing Capacity					141,710
Debt Instruments, Issuance Costs					6,529			$ 0
Repayments of Lines of Credit					20,000
Letter of Credit [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Long-term Line of Credit					3,290
Sargent Aerospace Defense Business [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Business Acquisition, Date of Acquisition Agreement	Apr. 24, 2015
Sargent Aerospace Defense Business [Member] | Debt [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Debt Instrument, Face Amount	$ 200,000
Sargent Aerospace Defense Business [Member] | Base Rate [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Debt Instrument, Basis Spread on Variable Rate	0.50%
Sargent Aerospace Defense Business [Member] | London Interbank Offered Rate (LIBOR) [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.50%
Debt Instrument, Description of Variable Rate Basis	higher of (1) Wells Fargos prime lending rate, (2) the federal funds effective rate plus 1/2 of 1% and (3) the one-month LIBOR rate plus 1% or (b) LIBOR rate plus a specified margin, depending on the type of borrowing being made.
Sargent Aerospace Defense Business [Member] | Revolving Credit Facility [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Proceeds from Lines of Credit					205,000
Debt Instrument, Face Amount	$ 350,000
Schaublin [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Mortgage loan interest rate		2.90%	2.90%
Cash paid for purchase price		$ 5,053	SFr 4,767
Mortgage loan fixed rate		9,857							SFr 9,300
Mortgage loan					8,077		SFr 7,905
Sargent [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Long-term Line of Credit					225,000
Land and Building [Member] | Schaublin [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Land and building leased		$ 14,910							SFr 14,067
Period for fixed rate on mortgage loan		20 years	20 years
JP Morgan Credit Agreement [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Write off of Deferred Debt Issuance Cost					190
New Credit Agreement [Member] | Sargent Aerospace Defense Business [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Debt Instruments, Issuance Costs					6,529
Debt Issuance Original Amount					$ 7,122
Five-Year Senior Secured Revolving Credit Facility [Member] | JP Morgan Credit Agreement [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Current borrowing capacity				$ 150,000
Proceeds from Lines of Credit				100,000
Borrowing capacity incremental value				$ 25,000
Prime Rate Loans [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Line of credit facility, interest rate						0.50%
LIBOR Rate Loans [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Line of credit facility, interest rate					1.50%		1.50%
Term Loan [Member] | Sargent Aerospace Defense Business [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Line of Credit, Current					$ 195,000
Maximum [Member] | JP Morgan Credit Agreement [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Consolidated net debt adjusted EBITDA ratio					3.25
Consolidated fixed charge coverage ratio					1.5
Maximum [Member] | New Credit Agreement [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Consolidated net debt adjusted EBITDA ratio					3.50
Consolidated Interest Coverage Ratio					2.75
Minimum [Member] | JP Morgan Credit Agreement [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Consolidated net debt adjusted EBITDA ratio					1
Consolidated fixed charge coverage ratio					1
Minimum [Member] | New Credit Agreement [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Consolidated net debt adjusted EBITDA ratio					1
Consolidated Interest Coverage Ratio					1

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Goodwill and Intangible Assets (Tables)

6 Months Ended

Sep. 26, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule Of Goodwill Balances, By Segment

Goodwill

	Roller		Plain		Ball		Engineered Products		Total
March 28, 2015	$	16,007	$	20,641	$	5,623	$	1,168	$	43,439
Acquisitions		—		57,479		—		169,002		226,481
Other		—		—		—		(19)		(19)
September 26, 2015	$	16,007	$	78,120	$	5,623	$	170,151	$	269,901

Schedule Of Intangible Assets

Intangible Assets

		September 26, 2015				March 28, 2015
	Weighted Average Useful Lives	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Product approvals	24	$	54,285	$	3,349	$	4,068	$	2,372
Customer relationships and lists	24		110,696		6,348		9,017		4,349
Trade names	10		19,990		2,219		2,102		1,372
Distributor agreements	5		722		722		722		722
Patents and trademarks	15		7,881		3,345		7,670		3,039
Domain names	10		437		320		437		299
Other	5		1,197		1,052		1,197		1,032
			195,208		17,355		25,213		13,185
Non-amortizable repair station certifications	n/a		30,700		—		—		—
Total		$	225,908	$	17,355	$	25,213	$	13,185

Schedule Of Estimated Amortization Expense

Estimated amortization expense for the remaining six months of fiscal 2016, the five succeeding fiscal years and thereafter is as follows:

2016	$	4,814
2017		9,562
2018		9,439
2019		9,216
2020		9,108
2021		9,058
2022 and thereafter		126,656

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Income Taxes (Details Textual) - USD ($) $ in Thousands	3 Months Ended
	Sep. 26, 2015	Sep. 27, 2014
Income Tax Contingency [Line Items]
Effective income tax rate	33.80%	27.30%
Estimated decrease in credits and state tax	$ 449
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Restructuring Charges, Amount		$ 3,131
Effective Income Tax Rate Reconciliation, Other Adjustments, Amount	$ 51
Without Discrete Item [Member]
Income Tax Contingency [Line Items]
Effective income tax rate	33.50%	32.90%

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Reportable Segments (Tables)

6 Months Ended

Sep. 26, 2015

Segment Reporting [Abstract]

Schedule Of Segment Information

Segment performance is evaluated based on segment net sales and operating income. Items not allocated to segment operating income include corporate administrative expenses and certain other amounts.

	Three Months Ended				Six Months Ended
	September 26,		September 27,		September 26,		September 27,
	2015		2014		2015		2014
Net External Sales
Plain	$	67,607	$	57,458	$	133,284	$	117,331
Roller		27,151		33,504		57,731		65,269
Ball		13,122		14,093		25,941		27,638
Engineered Products		40,816		7,500		74,048		15,301
	$	148,696	$	112,555	$	291,004	$	225,539
Gross Margin
Plain	$	26,763	$	20,817	$	52,711	$	43,284
Roller		11,355		10,799		24,250		23,590
Ball		5,292		5,360		10,475		10,787
Engineered Products		8,708		2,775		17,446		5,911
	$	52,118	$	39,751	$	104,882	$	83,572
Selling, General & Administrative Expenses
Plain	$	5,906	$	4,588	$	11,389	$	9,350
Roller		1,483		1,566		2,973		3,251
Ball		1,370		1,279		2,738		2,607
Engineered Products		4,176		881		8,122		1,861
Corporate		12,009		10,203		23,447		20,444
	$	24,944	$	18,517	$	48,669	$	37,513
Operating Income
Plain	$	20,784	$	15,950	$	41,089	$	33,503
Roller		9,724		6,497		21,064		17,449
Ball		3,775		3,914		7,447		7,867
Engineered Products		2,303		1,909		4,863		4,034
Corporate		(12,987)		(9,973)		(28,503)		(20,345)
	$	23,599	$	18,297	$	45,960	$	42,508
Geographic External Sales
Domestic	$	130,521	$	93,387	$	253,501	$	188,433
Foreign		18,175		19,168		37,503		37,106
	$	148,696	$	112,555	$	291,004	$	225,539
Intersegment Sales
Plain	$	977	$	1,041	$	2,116	$	2,020
Roller		5,182		5,056		10,695		10,039
Ball		486		706		1,047		1,258
Engineered Products		7,023		7,840		15,134		15,028
	$	13,668	$	14,643	$	28,992	$	28,345

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Organization and Business

6 Months Ended

Sep. 26, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Business

The consolidated financial statements included herein have been prepared by RBC Bearings Incorporated, a Delaware corporation (collectively with its subsidiaries, the “Company”), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. The March 28, 2015 fiscal year end balance sheet data have been derived from the Company’s audited financial statements, but do not include all disclosures required by generally accepted accounting principles in the United States. The interim financial statements included with this report have been prepared on a consistent basis with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 28, 2015.

These statements reflect all adjustments, accruals and estimates consisting only of items of a normal recurring nature, which are, in the opinion of management, necessary for the fair presentation of the consolidated financial condition and consolidated results of operations for the interim periods presented. These financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Annual Report on Form 10-K.

The results of operations for the six month period ended September 26, 2015 are not necessarily indicative of the operating results for the entire fiscal year ending April 2, 2016. The three month periods ended September 26, 2015 and September 27, 2014 each include 13 weeks. The amounts shown are in thousands, unless otherwise indicated.

Adoption of Recent Accounting Pronouncements

In September 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-16, “Business Combinations (Topic 805), Simplifying the Accounting for Measurement-Period Adjustments.” This ASU allows an acquirer in a business combination to account for measurement-period adjustments during the period in which it determines the amount of the adjustment. An acquirer would also need to capture in the current period any effect on earnings it would have recorded in previous periods if the accounting had been completed at the acquisition date. This pronouncement is effective for fiscal and interim periods beginning after December 15, 2015. Early adoption is permitted. The Company has adopted this update effective with their interim period beginning March 29, 2015.

In April 2015, the FASB issued ASU No. 2015-04, “Compensation - Retirement Benefits: Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets.” This ASU permits an entity with a fiscal year-end that does not coincide with a month-end, to measure defined benefit plan assets and obligations using the month end that is closest to the entity’s fiscal year-end and apply that consistently from year to year. The practical expedient requires if a contribution or significant event occurs between the month-end date used to measure the defined benefit plan assets and an entity’s fiscal year end, the entity should adjust the measurement of the defined benefit plan assets and obligations to reflect the effects of those contributions and other significant events. This pronouncement is effective for fiscal and interim periods beginning after December 15, 2015. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-03, “Interest - Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs.” This ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. This pronouncement is effective for fiscal and interim periods beginning after December 15, 2015. Early adoption is allowed. Given the requirement for retrospective treatment, the Company adopted this pronouncement in the first quarter of fiscal 2016. Other than a different presentation within the balance sheet, the adoption of this ASU did not have a material impact on the Company’s financial statements.

In January 2015, the FASB issued ASU No. 2015-01, “Income Statement-Extraordinary and Unusual Items.” This update eliminates the concept of extraordinary items and removes the requirements to separately present extraordinary events. This ASU also requires additional disclosures for items that are both unusual in nature and infrequent in occurrence. This pronouncement is effective for fiscal years and interim periods beginning after December 15, 2015. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements-Going Concern.” This update requires management to evaluate whether there are conditions or events that raise substantial doubt about an entity’s ability to continue as a going concern, and requires related footnote disclosures. This pronouncement is effective for fiscal years and interim periods beginning after December 15, 2016. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” to clarify existing guidance on revenue recognition. This guidance includes the required steps to achieve the core principle that a company should recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. This pronouncement is effective for fiscal years and interim periods beginning after December 15, 2016 with no early adoption permitted. The Company has not determined the effect that the adoption of the pronouncement may have on its financial position and/or results of operations.

In April 2014, the FASB issued ASU No. 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.” This update requires additional disclosures about discontinued operations and amends the requirements for reporting discontinued operations. Under this ASU only disposals constituting a major financial or operational impact or that represent a strategic shift should be reported as discontinued operations. This update also requires new disclosures for individually material disposals that do not qualify as discontinued operations. This guidance was adopted by the Company at the beginning of the second quarter of fiscal 2015. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements.

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Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 26, 2015	Mar. 28, 2015
Accounts receivable, allowance for doubtful accounts	$ 1,643	$ 860
Intangible assets, accumulated amortization	$ 17,355	$ 13,185
Preferred Stock
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, authorized shares	10,000,000	10,000,000
Preferred stock, issued shares	0	0
Preferred stock, outstanding shares	0	0
Common Stock
Common stock, par value	$ 0.01	$ 0.01
Common stock, authorized shares	60,000,000	60,000,000
Common stock, issued shares	23,989,656	23,833,185
Common stock, outstanding shares	23,989,656	23,833,185
Treasury Stock
Treasury stock, shares	559,856	439,864

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Acquisitions

6 Months Ended

Sep. 26, 2015

Business Combinations [Abstract]

Acquisitions

10. Acquisitions

On April 24, 2015, the Company acquired Sargent from Dover Corporation for $500,000 financed through a combination of cash on hand and senior debt. With headquarters in Tucson, Arizona, Sargent is a leader in precision-engineered products, solutions and repairs for aircraft airframes and engines, rotorcraft, submarines and land vehicles. Sargent manufactures, sells and services hydraulic valves and actuators, specialty bearings, specialty fasteners, seal rings & alignment joints and engineered components under leading brands including Kahr Bearing, Airtomic, Sonic Industries, Sargent Controls and Sargent Aerospace & Defense. The Company acquired Sargent because management believes it provides complementary products and channels, and expands and enhances the Company’s product portfolio and engineering technologies. The bearings and rings businesses are included in the Plain Bearings segment. The hydraulics, fasteners and precision components businesses are included in the Engineered Products segment.

 

The acquisition of Sargent was accounted for as a purchase in accordance with FASB Accounting Standards Codification (“ASC”) Topic 805, Business Combinations. Assets acquired and liabilities assumed were recorded at their fair values as of the acquisition date. The fair values of identifiable intangible assets, which were primarily customer relationships, product approvals, trade names, and patents and trademarks, were based on valuations using the income approach. The excess of the purchase price over the estimated fair values of tangible assets, identifiable intangible assets and assumed liabilities was recorded as goodwill. The goodwill is attributable to expected synergies and expected growth opportunities. The preliminary price allocation resulted in goodwill of $226,481. The Company estimates a majority of goodwill will be deductible for United States income tax purposes. The allocation of purchase price is preliminary as the Company has not completed its analysis estimating the fair value of inventory, property, plant, and equipment, intangible assets, income tax liabilities and certain contingent liabilities. The purchase price allocation was updated to reflect current estimated fair values at the acquisition date, with the excess of purchase price over the estimated fair value of the net assets acquired recorded as goodwill.

The preliminary purchase price allocation for Sargent was as follows:

	As of April 24, 2015
Current assets	$	3,086
Trade receivables		23,892
Inventories		47,709
Property, plant and equipment		41,538
Intangible assets		201,000
Goodwill		226,481
Total assets acquired		543,706
Accounts payable		14,900
Liabilities assumed		28,806
Net assets acquired	$	500,000

The valuation of the net assets acquired of $500,000 was classified as Level 3 in the valuation hierarchy. Level 3 inputs represent unobservable inputs for the asset or liability.

The components of intangible assets included as part of the Sargent acquisition was as follows:

	Weighted Average Amortization Period (Years)	Gross Value
Amortizable intangible assets
Customer relationships	25	$	101,800
Product approvals	25		50,500
Trademarks and tradenames	10		18,000
			170,300
Non-amortizable intangible assets
Repair station certifications	-		30,700
Intangible assets		$	201,000

Included in the Company’s results of operations for the three and six months ended September 26, 2015 are revenues related to the Sargent acquisition of $45,507 and $79,509, respectively. Also, included for the three and six months ended September 26, 2015 is net income of $1,407 and $5,232, respectively. Acquisition-related expenses were recorded in Other, net in the Consolidated Statements of Operations for both the three and six months ended September 26, 2015 of $1,283 and $6,071, respectively.

The following supplemental pro forma financial information presents the financial results for the three and six months ended September 26, 2015 and September 27, 2014, as if the acquisition of Sargent had occurred at the beginning of fiscal year 2015. The pro forma financial information includes, where applicable, adjustments for: (i) the estimated amortization of acquired intangible assets, (ii) estimated additional interest expense on acquisition related borrowings, (iii) the income tax effect on the pro forma adjustments using an estimated effective tax rate. The pro forma financial information excludes, where applicable, adjustments for: (i) the estimated impact of inventory purchase accounting adjustments and (ii) the estimated closing costs on the acquisition. The pro forma financial information is presented for illustrative purposes only and is not necessarily indicative of the operating results that would have been achieved had the acquisition been completed as of the date indicated or the results that may be obtained in the future:

	Three Months Ended				Six Months Ended
	September 26, 2015		September 27, 2014		September 26, 2015		September 27, 2014
Pro forma net sales	$	148,696	$	162,145	$	299,378	$	325,355
Pro forma net income		18,058		14,170		34,723		30,856
Basic earnings per share as reported	$	0.63	$	0.57	$	1.20	$	1.27
Pro forma basic earnings per share		0.78		0.61		1.50		1.34
Diluted earnings per share as reported	$	0.62	$	0.57	$	1.19	$	1.25
Pro forma diluted earnings per share		0.77		0.60		1.48		1.32

On October 7, 2013, the Company acquired the net assets of Turbine Components Inc. (“TCI”) for approximately $3,925. Located in San Diego, California, TCI is an FAA certified aircraft gas turbine repair station and manufacturer of precision components for aerospace markets. TCI’s net sales for the prior calendar year were approximately $4,000. The purchase price allocation is as follows: accounts receivable ($585), inventory ($125), fixed assets ($1,231), goodwill ($2,821), intangible assets ($441), other non-current assets ($127), other current liabilities ($641) and noncurrent liabilities ($766). The purchase price allocation, which resulted in goodwill of $2,821, is deductible for tax purposes. TCI is included in the Plain Bearings segment. In connection with the acquisition the Company agreed to a contract for additional contingent consideration that is dependent on the outcome of future events. The contingent consideration is based on a market valuation formula and will be payable five years from the acquisition date. The current fair value of the contingent consideration is determined to be $469. Pro forma net sales and net income inclusive of TCI are not materially different from the amounts reported in the accompanying consolidated statements of operations.

 

On August 16, 2013, the Company acquired Climax Metal Products Company (“CMP”) located in Mentor, Ohio for $13,646. The purchase price included $10,672 in cash and $2,974 of debt. CMP is a manufacturer of precision shaft collars, rigid couplings, keyless locking devices and bearings for the industrial markets. CMP’s net sales for the prior calendar year were approximately $14,100. The purchase price allocation is as follows: accounts receivable ($1,206), inventory ($4,509), other current assets ($73), fixed assets ($2,466), goodwill ($5,623), intangible assets ($3,904), other non-current assets ($10), other current liabilities ($2,171) and noncurrent liabilities ($1,974). The purchase price allocation, which resulted in goodwill of $5,623, is not deductible for tax purposes. CMP is included in the Ball Bearings segment. Pro forma net sales and net income inclusive of CMP are not materially different from the amounts reported in the accompanying consolidated statements of operations.

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Document And Entity Information - shares	6 Months Ended
	Sep. 26, 2015	Oct. 22, 2015
Document Information [Line Items]
Entity Registrant Name	RBC Bearings INC
Entity Central Index Key	0001324948
Current Fiscal Year End Date	--04-02
Entity Filer Category	Large Accelerated Filer
Trading Symbol	ROLL
Entity Common Stock, Shares Outstanding		23,421,370
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 26, 2015
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q2

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Organization and Business (Policies)

6 Months Ended

Sep. 26, 2015

Accounting Policies [Abstract]

Adoption of Recent Accounting Pronouncements

Adoption of Recent Accounting Pronouncements

In September 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-16, “Business Combinations (Topic 805), Simplifying the Accounting for Measurement-Period Adjustments.” This ASU allows an acquirer in a business combination to account for measurement-period adjustments during the period in which it determines the amount of the adjustment. An acquirer would also need to capture in the current period any effect on earnings it would have recorded in previous periods if the accounting had been completed at the acquisition date. This pronouncement is effective for fiscal and interim periods beginning after December 15, 2015. Early adoption is permitted. The Company has adopted this update effective with their interim period beginning March 29, 2015.

In April 2015, the FASB issued ASU No. 2015-04, “Compensation - Retirement Benefits: Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets.” This ASU permits an entity with a fiscal year-end that does not coincide with a month-end, to measure defined benefit plan assets and obligations using the month end that is closest to the entity’s fiscal year-end and apply that consistently from year to year. The practical expedient requires if a contribution or significant event occurs between the month-end date used to measure the defined benefit plan assets and an entity’s fiscal year end, the entity should adjust the measurement of the defined benefit plan assets and obligations to reflect the effects of those contributions and other significant events. This pronouncement is effective for fiscal and interim periods beginning after December 15, 2015. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-03, “Interest - Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs.” This ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. This pronouncement is effective for fiscal and interim periods beginning after December 15, 2015. Early adoption is allowed. Given the requirement for retrospective treatment, the Company adopted this pronouncement in the first quarter of fiscal 2016. Other than a different presentation within the balance sheet, the adoption of this ASU did not have a material impact on the Company’s financial statements.

In January 2015, the FASB issued ASU No. 2015-01, “Income Statement-Extraordinary and Unusual Items.” This update eliminates the concept of extraordinary items and removes the requirements to separately present extraordinary events. This ASU also requires additional disclosures for items that are both unusual in nature and infrequent in occurrence. This pronouncement is effective for fiscal years and interim periods beginning after December 15, 2015. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements-Going Concern.” This update requires management to evaluate whether there are conditions or events that raise substantial doubt about an entity’s ability to continue as a going concern, and requires related footnote disclosures. This pronouncement is effective for fiscal years and interim periods beginning after December 15, 2016. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements.

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” to clarify existing guidance on revenue recognition. This guidance includes the required steps to achieve the core principle that a company should recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. This pronouncement is effective for fiscal years and interim periods beginning after December 15, 2016 with no early adoption permitted. The Company has not determined the effect that the adoption of the pronouncement may have on its financial position and/or results of operations.

In April 2014, the FASB issued ASU No. 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.” This update requires additional disclosures about discontinued operations and amends the requirements for reporting discontinued operations. Under this ASU only disposals constituting a major financial or operational impact or that represent a strategic shift should be reported as discontinued operations. This update also requires new disclosures for individually material disposals that do not qualify as discontinued operations. This guidance was adopted by the Company at the beginning of the second quarter of fiscal 2015. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements.

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Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 26, 2015	Sep. 27, 2014	Sep. 26, 2015	Sep. 27, 2014
Net sales	$ 148,696	$ 112,555	$ 291,004	$ 225,539
Cost of sales	96,578	72,804	186,122	141,967
Gross margin	52,118	39,751	104,882	83,572
Operating expenses:
Selling, general and administrative	24,944	18,517	48,669	37,513
Other, net	3,575	2,937	10,253	3,551
Total operating expenses	28,519	21,454	58,922	41,064
Operating income	23,599	18,297	45,960	42,508
Interest expense, net	2,273	308	3,984	532
Other non-operating (income) expense	(596)	(235)	10	(502)
Income before income taxes	21,922	18,224	41,966	42,478
Provision for income taxes	7,403	4,976	14,043	13,210
Net income	$ 14,519	$ 13,248	$ 27,923	$ 29,268
Net income per common share:
Basic	$ 0.63	$ 0.57	$ 1.2	$ 1.27
Diluted	$ 0.62	$ 0.57	$ 1.19	$ 1.25
Weighted average common shares:
Basic	23,210,640	23,134,902	23,186,600	23,070,170
Diluted	23,495,285	23,424,421	23,516,537	23,394,439
Dividends per Share	$ 0	$ 0	$ 0	$ 2

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Goodwill and Intangible Assets

6 Months Ended

Sep. 26, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

5. Goodwill and Intangible Assets

Goodwill

	Roller		Plain		Ball		Engineered Products		Total
March 28, 2015	$	16,007	$	20,641	$	5,623	$	1,168	$	43,439
Acquisitions		—		57,479		—		169,002		226,481
Other		—		—		—		(19)		(19)
September 26, 2015	$	16,007	$	78,120	$	5,623	$	170,151	$	269,901

Intangible Assets

		September 26, 2015				March 28, 2015
	Weighted Average Useful Lives	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Product approvals	24	$	54,285	$	3,349	$	4,068	$	2,372
Customer relationships and lists	24		110,696		6,348		9,017		4,349
Trade names	10		19,990		2,219		2,102		1,372
Distributor agreements	5		722		722		722		722
Patents and trademarks	15		7,881		3,345		7,670		3,039
Domain names	10		437		320		437		299
Other	5		1,197		1,052		1,197		1,032
			195,208		17,355		25,213		13,185
Non-amortizable repair station certifications	n/a		30,700		—		—		—
Total		$	225,908	$	17,355	$	25,213	$	13,185

Amortization expense for definite-lived intangible assets for the three and six month periods ended September 26, 2015 was $2,402 and $4,170, respectively. Amortization expense for definite-lived intangible assets for the three and six month periods ended September 27, 2014 was $467 and $964, respectively. Estimated amortization expense for the remaining six months of fiscal 2016, the five succeeding fiscal years and thereafter is as follows:

2016	$	4,814
2017		9,562
2018		9,439
2019		9,216
2020		9,108
2021		9,058
2022 and thereafter		126,656

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Inventory

6 Months Ended

Sep. 26, 2015

Inventory, Net [Abstract]

Inventory

4. Inventory

Inventories are stated at the lower of cost or market, using the first-in, first-out method, and are summarized below:

	September 26, 2015		March 28, 2015
Raw materials	$	29,361	$	18,424
Work in process		76,514		50,243
Finished goods		157,008		137,491
	$	262,883	$	206,158

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Debt (Tables)

6 Months Ended

Sep. 26, 2015

Debt Instruments [Abstract]

Schedule Of Balances Payable Under Borrowing Facilities

The balances payable under all borrowing facilities are as follows:

	September 26,		March 28,
	2015		2015
Revolver and term loan facilities	$	400,000	$	—
Debt issuance costs		(6,529)		—
Other		8,827		9,198
Total debt		402,298		9,198
Less: current portion		8,725		1,233
Long-term debt	$	393,573	$	7,965

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Accumulated Other Comprehensive Income (Loss) (Tables)

6 Months Ended

Sep. 26, 2015

Accumulated Other Comprehensive Income Loss [Abstract]

Schedule Of Accumulated Other Comprehensive Income (Loss)

The following summarizes the activity within each component of accumulated other comprehensive income (loss):

	Currency Translation		Pension and Postretirement Liability		Total
Balance at March 28, 2015	$	(93)	$	(7,677)	$	(7,770)
Other comprehensive income (loss) before reclassifications (net of taxes)		(1,675)		(373)		(2,048)
Amounts reclassified from accumulated other comprehensive income (loss)		—		(82)		(82)
Net current period other comprehensive income (loss)		(1,675)		(455)		(2,130)
Balance at September 26, 2015	$	(1,768)	$	(8,132)	$	(9,900)

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Reportable Segments

6 Months Ended

Sep. 26, 2015

Segment Reporting [Abstract]

Reportable Segments

8. Reportable Segments

The Company operates through operating segments for which separate financial information is available, and for which operating results are evaluated regularly by the Company's chief operating decision maker in determining resource allocation and assessing performance. Those operating segments with similar economic characteristics and that meet all other required criteria, including nature of the products and production processes, distribution patterns and classes of customers, are aggregated as reportable segments. With the acquisition and integration of Sargent into the Company’s operating and reportable segment structure, the Company has transitioned the Other segment to a new reportable segment titled Engineered Products. The Company has four reportable business segments; Plain Bearings, Roller Bearings, Ball Bearings and Engineered Products, which are described below.

Plain Bearings. Plain bearings are produced with either self-lubricating or metal-to-metal designs and consists of several sub-classes, including rod end bearings, spherical plain bearings and journal bearings. Unlike ball bearings, which are used in high-speed rotational applications, plain bearings are primarily used to rectify inevitable misalignments in various mechanical components. The bearings and rings businesses of Sargent are included here.

Roller Bearings. Roller bearings are anti-friction bearings that use rollers instead of balls. The Company manufactures four basic types of roller bearings: heavy duty needle roller bearings with inner rings, tapered roller bearings, track rollers and aircraft roller bearings.

Ball Bearings. The Company manufactures four basic types of ball bearings: high precision aerospace, airframe control, thin section and commercial ball bearings which are used in high-speed rotational applications.

Engineered Products. Engineered Products consists of highly engineered hydraulics, fasteners, collets and precision components used in aerospace, marine and industrial applications. The hydraulics, fasteners and precision components businesses of Sargent are included here.

Segment performance is evaluated based on segment net sales and operating income. Items not allocated to segment operating income include corporate administrative expenses and certain other amounts.

	Three Months Ended				Six Months Ended
	September 26,		September 27,		September 26,		September 27,
	2015		2014		2015		2014
Net External Sales
Plain	$	67,607	$	57,458	$	133,284	$	117,331
Roller		27,151		33,504		57,731		65,269
Ball		13,122		14,093		25,941		27,638
Engineered Products		40,816		7,500		74,048		15,301
	$	148,696	$	112,555	$	291,004	$	225,539
Gross Margin
Plain	$	26,763	$	20,817	$	52,711	$	43,284
Roller		11,355		10,799		24,250		23,590
Ball		5,292		5,360		10,475		10,787
Engineered Products		8,708		2,775		17,446		5,911
	$	52,118	$	39,751	$	104,882	$	83,572
Selling, General & Administrative Expenses
Plain	$	5,906	$	4,588	$	11,389	$	9,350
Roller		1,483		1,566		2,973		3,251
Ball		1,370		1,279		2,738		2,607
Engineered Products		4,176		881		8,122		1,861
Corporate		12,009		10,203		23,447		20,444
	$	24,944	$	18,517	$	48,669	$	37,513
Operating Income
Plain	$	20,784	$	15,950	$	41,089	$	33,503
Roller		9,724		6,497		21,064		17,449
Ball		3,775		3,914		7,447		7,867
Engineered Products		2,303		1,909		4,863		4,034
Corporate		(12,987)		(9,973)		(28,503)		(20,345)
	$	23,599	$	18,297	$	45,960	$	42,508
Geographic External Sales
Domestic	$	130,521	$	93,387	$	253,501	$	188,433
Foreign		18,175		19,168		37,503		37,106
	$	148,696	$	112,555	$	291,004	$	225,539
Intersegment Sales
Plain	$	977	$	1,041	$	2,116	$	2,020
Roller		5,182		5,056		10,695		10,039
Ball		486		706		1,047		1,258
Engineered Products		7,023		7,840		15,134		15,028
	$	13,668	$	14,643	$	28,992	$	28,345

All intersegment sales are eliminated in consolidation.

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Debt

6 Months Ended

Sep. 26, 2015

Debt Instruments [Abstract]

Debt

6. Debt

The balances payable under all borrowing facilities are as follows:

	September 26,		March 28,
	2015		2015
Revolver and term loan facilities	$	400,000	$	—
Debt issuance costs		(6,529)		—
Other		8,827		9,198
Total debt		402,298		9,198
Less: current portion		8,725		1,233
Long-term debt	$	393,573	$	7,965

New Credit Facility

In connection with the Sargent Aerospace & Defense (“Sargent”) acquisition on April 24, 2015, the Company entered into a new credit agreement (the “New Credit Agreement”) and related Guarantee, Pledge Agreement and Security Agreement with Wells Fargo Bank, National Association, as Administrative Agent, Collateral Agent, Swingline Lender and Letter of Credit Issuer and the other lenders party thereto and terminated the JP Morgan Credit Agreement. The New Credit Agreement provides RBCA, as Borrower, with (a) a $200,000 term loan facility (the “Term Loan”) and (b) a $350,000 revolving credit facility (the “Revolver” and together with the Term Loan, the “Facilities”).

 

Amounts outstanding under the Facilities generally bear interest at (a) a base rate determined by reference to the higher of (1) Wells Fargo’s prime lending rate, (2) the federal funds effective rate plus 1/2 of 1% and (3) the one-month LIBOR rate plus 1% or (b) LIBOR rate plus a specified margin, depending on the type of borrowing being made. The applicable margin is based on the Company's consolidated ratio of total net debt to consolidated EBITDA from time to time. Currently, the Company's margin is 0.5% for base rate loans and 1.5% for LIBOR rate loans. As of September 26, 2015, there was $205,000 outstanding under the Revolver and $195,000 outstanding under the Term Loan, offset by $6,529 in debt issuance costs (original amount was $7,122).

 

The New Credit Agreement requires the Company to comply with various covenants, including among other things, financial covenants to maintain the following: (1) a ratio of consolidated net debt to adjusted EBITDA, not to exceed 3.50 to 1; and (2) a consolidated interest coverage ratio not to exceed 2.75 to 1. The New Credit Agreement allows the Company to, among other things, make distributions to shareholders, repurchase its stock, incur other debt or liens, or acquire or dispose of assets provided that the Company complies with certain requirements and limitations of the agreement. As of September 26, 2015, the Company was in compliance with all such covenants.

 

The Company’s obligations under the New Credit Agreement are secured as well as providing for a pledge of substantially all of the Company’s and RBCA’s assets. The Company and certain of its subsidiaries have also entered into a Guarantee to guarantee RBCA’s obligations under the New Credit Agreement.

Approximately $3,290 of the Revolver is being utilized to provide letters of credit to secure RBCA’s obligations relating to certain insurance programs, and $225,000 was utilized to finance the acquisition of Sargent. As of September 26, 2015, RBCA paid down $20,000 of the Revolver and has the ability to borrow up to an additional $141,710 under the Revolver.

 

Prior Credit Facility

On November 30, 2010, the Company entered into a credit agreement (the “JP Morgan Credit Agreement”) and related security and guaranty agreements with certain banks, J.P. Morgan Chase Bank, N.A., as Administrative Agent, and J.P. Morgan Chase Bank, N.A. and KeyBank National Association as Co-Lead Arrangers and Joint Lead Book Runners. The JP Morgan Credit Agreement provides Roller Bearing Company of America, Inc. (“RBCA”), as borrower, with a $150,000 five-year senior secured revolving credit facility which can be increased by up to $100,000, in increments of $25,000, under certain circumstances and subject to certain conditions (including the receipt from one or more lenders of the additional commitment).

 

Amounts outstanding under the JP Morgan Credit Agreement generally bear interest at the prime rate or LIBOR plus a specified margin, depending on the type of borrowing being made. The applicable margin is based upon the Company’s consolidated ratio of net debt to adjusted EBITDA, measured at the end of each quarter. As of September 27, 2014, the Company’s margin is 0.5% for prime rate loans and 1.5% for LIBOR rate loans.

The JP Morgan Credit Agreement requires the Company to comply with various covenants, including among other things, financial covenants to maintain the following: (1) a ratio of consolidated net debt to adjusted EBITDA, not to exceed 3.25 to 1; and (2) a consolidated fixed charge coverage ratio not to exceed 1.5 to 1. The credit agreement allows the Company to, among other things, make distributions to shareholders, repurchase its stock, incur other debt or liens, or acquire or dispose of assets provided that the Company complies with certain requirements and limitations of the agreement. The JP Morgan Credit Agreement was terminated and replaced by the New Credit Agreement discussed above. $190 of debt issuance costs were written off on termination.

 

Other Notes Payable

On October 1, 2012, Schaublin purchased the land and building, which it occupied and had been leasing, for 14,067 CHF (approximately $14,910). Schaublin obtained a 20 year fixed rate mortgage of 9,300 CHF (approximately $9,857) at an interest rate of 2.9%. The balance of the purchase price of 4,767 CHF (approximately $5,053) was paid from cash on hand. The balance on this mortgage as of September 26, 2015 was 7,905 CHF, or $8,077.

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Income Taxes

6 Months Ended

Sep. 26, 2015

Income Tax Disclosure [Abstract]

Income Taxes

7. Income Taxes

The Company files income tax returns in the U.S. federal jurisdiction, various states and foreign jurisdictions. With few exceptions, the Company is no longer subject to state or foreign income tax examinations by tax authorities for years ending before March 31, 2007. The Company is no longer subject to U.S. federal corporate income tax examination by the Internal Revenue Service for fiscal years ending before March 29, 2014. A U.S. federal corporate income tax examination by the Internal Revenue Service for the fiscal year ended March 30, 2013 was deemed effectively settled in the Company’s first quarter of fiscal 2016.

The effective income tax rates for the three month periods ended September 26, 2015 and September 27, 2014, were 33.8% and 27.3%. In addition to discrete items, the effective income tax rates for these periods are different from the U.S. statutory rates due to a special manufacturing deduction in the U.S. and foreign income taxed at lower rates which decrease the rate, and state income taxes which increases the rate.

The effective income tax rate for the three month period ended September 26, 2015 of 33.8% includes immaterial discrete items of $51. The effective income tax rate without discrete items for the three month period ended September 26, 2015 would have been 33.5%. The effective income tax rate for the three month period ended September 27, 2014 of 27.3% includes discrete items of $3,131 which are comprised substantially of items associated with the consolidation and restructuring of the Company’s U.K. manufacturing facility. The effective income tax rate without discrete items and without other associated consolidated and restructuring expenses pertaining to the Company’s UK manufacturing facility for the three month period ended September 27, 2014 would have been 32.9%. The Company believes it is reasonably possible that some of its unrecognized tax positions may be effectively settled within the next twelve months due to the closing of audits and the statute of limitations expiring in varying jurisdictions. The decrease, pertaining primarily to credits and state tax, is estimated to be approximately $449.

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Restructuring of Operations

6 Months Ended

Sep. 26, 2015

Restructuring and Related Activities [Abstract]

Restructuring of Operations

9. Restructuring of Operations

In the second quarter of fiscal 2015, the Company consolidated the manufacturing capacity of its United Kingdom (U.K.) facility into its other manufacturing facilities in order to better align manufacturing abilities and product development. As a result the Company recorded a charge of $6,382 in the second quarter and $88 in the third quarter of fiscal 2015 associated with the consolidation of operations attributable to the Roller Bearings segment. The $6,382 charge includes $3,707 of inventory rationalization costs that were recorded in cost of sales in the income statement. All other costs were recorded under operating expenses in the other, net category of the income statement. The pre-tax charge of $6,382 was offset with an associated tax benefit of $3,131.

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Debt (Details) - USD ($) $ in Thousands	Sep. 26, 2015	Mar. 28, 2015
Debt Instrument [Line Items]
Debt issuance costs	$ (6,529)	$ 0
Total debt	402,298	9,198
Less: current portion	8,725	1,233
Long-term debt	393,573	7,965
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Total debt	400,000	0
Other Loan [Member]
Debt Instrument [Line Items]
Total debt	$ 8,827	$ 9,198

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Inventory (Tables)

6 Months Ended

Sep. 26, 2015

Inventory, Net [Abstract]

Inventory

Inventories are stated at the lower of cost or market, using the first-in, first-out method, and are summarized below:

	September 26, 2015		March 28, 2015
Raw materials	$	29,361	$	18,424
Work in process		76,514		50,243
Finished goods		157,008		137,491
	$	262,883	$	206,158

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Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 26, 2015	Sep. 27, 2014	Sep. 26, 2015	Sep. 27, 2014
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance Beginning, Currency Translation			$ (93)
Other comprehensive income (loss) before reclassifications (net of taxes) Currency Translation			(1,675)
Amounts reclassified from accumulated other comprehensive income (loss) Currency Translation			0
Net current period other comprehensive income (loss) Currency Translation	$ (3,380)	$ (5,152)	(1,675)	$ (5,971)
Balance Ending,Currency Translation	(1,768)		(1,768)
Balance Beginning, Pension and Postretirement Liability			(7,677)
Other comprehensive income (loss) before reclassifications (net of taxes) Pension and Postretirement Liability			(373)
Amounts reclassified from accumulated other comprehensive income (loss) Pension and Postretirement Liability			(82)
Net current period other comprehensive income (loss) Pension and Postretirement Liability	(228)	$ 199	(455)	$ 398
Balance Ending, Pension and Postretirement Liability	(8,132)		(8,132)
Balance Beginning, Total			(7,770)
Other comprehensive income (loss) before reclassifications (net of taxes)			(2,048)
Amounts reclassified from accumulated other comprehensive income (loss)			(82)
Net current period other comprehensive income (loss)			(2,130)
Balance Ending, Total	$ (9,900)		$ (9,900)

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Acquisitions (Details 2) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 26, 2015	Sep. 27, 2014	Sep. 26, 2015	Sep. 27, 2014
Business Acquisition [Line Items]
Pro forma net sales	$ 148,696	$ 162,145	$ 299,378	$ 325,355
Pro forma net income	$ 18,058	$ 14,170	$ 34,723	$ 30,856
Basic earnings per share as reported	$ 0.63	$ 0.57	$ 1.2	$ 1.27
Pro forma basic earnings per share	0.78	0.61	1.5	1.34
Diluted earnings per share as reported	0.62	0.57	1.19	1.25
Pro forma diluted earnings per share	$ 0.77	$ 0.6	$ 1.48	$ 1.32

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Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 26, 2015	Sep. 27, 2014	Sep. 26, 2015	Sep. 27, 2014
Net income	$ 14,519	$ 13,248	$ 27,923	$ 29,268
Pension and postretirement liability adjustments, net of taxes	(228)	199	(455)	398
Unrealized gain on investments, net of taxes	0	(345)	0	(273)
Foreign currency translation adjustments	(3,380)	(5,152)	(1,675)	(5,971)
Total comprehensive income	$ 10,911	$ 7,950	$ 25,793	$ 23,422

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Cash and Cash Equivalents

6 Months Ended

Sep. 26, 2015

Cash and Cash Equivalents [Abstract]

Cash and Cash Equivalents

3. Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.

Short-term investments, if any, are comprised of equity securities and are measured at fair value by using quoted prices in active markets and are classified as Level 1 of the valuation hierarchy.

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Net Income Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 26, 2015	Sep. 27, 2014	Sep. 26, 2015	Sep. 27, 2014
Net Income Loss Per Common Share [Line Items]
Net income	$ 14,519	$ 13,248	$ 27,923	$ 29,268
Denominator:
Denominator for basic net income per common share—weighted-average shares outstanding	23,210,640	23,134,902	23,186,600	23,070,170
Effect of dilution due to employee stock awards	284,645	289,519	329,937	324,269
Denominator for diluted net income per common share — weighted-average shares outstanding	23,495,285	23,424,421	23,516,537	23,394,439
Basic net income per common share	$ 0.63	$ 0.57	$ 1.2	$ 1.27
Diluted net income per common share	$ 0.62	$ 0.57	$ 1.19	$ 1.25

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Restructuring of Operations (Details Textual) - USD ($) $ in Thousands	3 Months Ended
	Dec. 27, 2014	Sep. 27, 2014	Sep. 26, 2015	Mar. 28, 2015
Restructuring Cost and Reserve [Line Items]
Inventory			$ 262,883	$ 206,158
Roller Bearings
Restructuring Cost and Reserve [Line Items]
Restructuring Charges		$ 6,382
Inventory		3,707
Discrete tax benefit		3,131
Additional charges related to consolidation of operation	$ 88
Pre Tax Charges		$ 6,382

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Net Income Per Common Share (Tables)

6 Months Ended

Sep. 26, 2015

Earnings Per Share [Abstract]

Schedule Of Calculation Of Weighted-Average Shares Outstanding

The table below reflects the calculation of weighted-average shares outstanding for each period presented as well as the computation of basic and diluted net income per common share:

	Three Months Ended				Six Months Ended
	September 26,		September 27,		September 26,		September 27,
	2015		2014		2015		2014
Net income	$	14,519	$	13,248	$	27,923	$	29,268
Denominator for basic net income per common share—weighted-average shares outstanding		23,210,640		23,134,902		23,186,600		23,070,170
Effect of dilution due to employee stock awards		284,645		289,519		329,937		324,269
Denominator for diluted net income per common share — weighted-average shares outstanding		23,495,285		23,424,421		23,516,537		23,394,439
Basic net income per common share	$	0.63	$	0.57	$	1.20	$	1.27
Diluted net income per common share	$	0.62	$	0.57	$	1.19	$	1.25