10-Q

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q 

☑ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For Quarterly Period Ended September 30, 2018

Commission File Number 001-33994

INTERFACE, INC.

(Exact name of registrant as specified in its charter)

GEORGIA	58-1451243
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

1280 WEST PEACHTREE STREET, ATLANTA, GEORGIA 30309

(Address of principal executive offices and zip code)

(770) 437-6800

(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 ☑    No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Date File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑   No ☐

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

Large accelerated filer ☑ Accelerated filer ☐ Non-accelerated filer ☐   Emerging Growth Company ☐ Smaller reporting company ☐ 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐    No ☑

Shares outstanding of each of the registrant’s classes of common stock at November 1, 2018:

Class	Number of Shares
Common Stock, $.10 par value per share	59,520,468

INTERFACE, INC.

INDEX

			PAGE
PART I.	FINANCIAL INFORMATION
	Item 1.	Financial Statements	3
		Consolidated Condensed Balance Sheets – September 30, 2018 and December 31, 2017	3
		Consolidated Condensed Statements of Operations – Three Months and Nine Months Ended September 30, 2018 and October 1, 2017	4
		Consolidated Statements of Comprehensive Income – Three Months and Nine Months Ended September 30, 2018 and October 1, 2017	5
		Consolidated Condensed Statements of Cash Flows – Nine Months Ended September 30, 2018 and October 1, 2017	6
		Notes to Consolidated Condensed Financial Statements	7
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
	Item 3.	Quantitative and Qualitative Disclosures about Market Risk	23
	Item 4.	Controls and Procedures	24
PART II.	OTHER INFORMATION
	Item 1.	Legal Proceedings	25
	Item 1A.	Risk Factors	25
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
	Item 3.	Defaults Upon Senior Securities	25
	Item 4.	Mine Safety Disclosures	25
	Item 5.	Other Information	25
	Item 6.	Exhibits	26

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

INTERFACE, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED BALANCE SHEETS

(IN THOUSANDS)

	SEPTEMBER 30, 2018			DECEMBER 31, 2017
	(UNAUDITED)
ASSETS
Current Assets:
Cash and cash equivalents	$	107,331		$	87,037
Accounts receivable, net		177,766			142,808
Inventories, net		278,815			177,935
Prepaid expenses and other current assets		36,314			23,087
Total current assets		600,226			430,867
Property and equipment, net		292,606			212,645
Deferred tax asset		23,324			18,003
Goodwill and intangible assets, net		353,810			68,754
Other assets		72,994			70,331
Total assets	$	1,342,960		$	800,600
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	69,353		$	50,672
Accrued expenses		137,862			110,974
Current portion of long-term debt		31,315			15,000
Total current liabilities		238,530			176,646
Long-term debt		617,565			214,928
Deferred income taxes		27,475			6,935
Other		106,410			72,000
Total liabilities		989,980			470,509
Commitments and Contingencies
Shareholders’ equity
Preferred stock		0			0
Common stock		5,951			5,981
Additional paid-in capital		265,300			271,271
Retained Earnings		219,689			187,432
Accumulated other comprehensive loss – foreign currency translation		(85,922	)		(78,943	)
Accumulated other comprehensive income – cash flow hedges		3,469			904
Accumulated other comprehensive loss – pension liability		(55,507	)		(56,554	)
Total shareholders’ equity		352,980			330,091
Total liabilities and shareholders’ equity	$	1,342,960		$	800,600

See accompanying notes to consolidated condensed financial statements.

-3-

INTERFACE, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

(UNAUDITED)

(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)

	THREE MONTHS ENDED				NINE MONTHS ENDED
	SEPTEMBER 30, 2018		OCTOBER 1, 2017		SEPTEMBER 30, 2018		OCTOBER 1, 2017
NET SALES	$	318,325	$	257,431	$	842,514	$	730,233
Cost of Sales		218,380		158,887		539,839		445,990
GROSS PROFIT ON SALES		99,945		98,544		302,675		284,243
Selling, General and Administrative Expenses		84,160		67,233		230,199		196,333
Restructuring and Asset Impairment Charges		0		0		0		7,299
OPERATING INCOME		15,785		31,311		72,476		80,611
Interest Expense		4,852		1,851		9,207		5,150
Other Expense		1,570		1,051		5,350		3,143
INCOME BEFORE INCOME TAX EXPENSE		9,363		28,409		57,919		72,318
Income Tax Expense		1,191		8,970		14,061		23,394
NET INCOME	$	8,172	$	19,439	$	43,858	$	48,924
Earnings Per Share – Basic	$	0.14	$	0.32	$	0.74	$	0.78
Earnings Per Share – Diluted	$	0.14	$	0.32	$	0.74	$	0.78
Common Shares Outstanding – Basic		59,496		61,018		59,553		62,630
Common Shares Outstanding – Diluted		59,536		61,060		59,594		62,672

See accompanying notes to consolidated condensed financial statements.

-4-

INTERFACE, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

(IN THOUSANDS)

	THREE MONTHS ENDED						NINE MONTHS ENDED
	SEPTEMBER 30, 2018			OCTOBER 1, 2017			SEPTEMBER 30, 2018			OCTOBER 1, 2017
Net Income	$	8,172		$	19,439		$	43,858		$	48,924
Other Comprehensive Income / (Loss), Foreign Currency Translation Adjustment		4,964			9,848			(6,979	)		30,678
Other Comprehensive Income, Cash Flow Hedges		286			0			2,565			0
Other Comprehensive Income / (Loss), Pension Liability Adjustment		(196	)		(1,994	)		1,047			(4,974	)
Comprehensive Income	$	13,226		$	27,293		$	40,491		$	74,628

See accompanying notes to consolidated condensed financial statements.

-5-

INTERFACE, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(IN THOUSANDS)

	NINE MONTHS ENDED
	SEPTEMBER 30, 2018			OCTOBER 1, 2017
OPERATING ACTIVITIES:
Net Income	$	43,858		$	48,924
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		27,067			22,203
Stock compensation amortization expense		9,181			4,479
Deferred income taxes and other		(10,705	)		5,926
Amortization of acquired intangible assets		2,414			0
Amortization of acquired inventory step-up		17,849			0
Working capital changes:
Accounts receivable		(5,540	)		(1,397	)
Inventories		(27,037	)		(22,377	)
Prepaid expenses and current assets		(9,398	)		(653	)
Accounts payable and accrued expenses		10,987			10,804
CASH PROVIDED BY OPERATING ACTIVITIES:		58,676			67,909
INVESTING ACTIVITIES:
Capital expenditures		(28,853	)		(22,809	)
Cash paid for business, net of cash acquired		(400,697	)		0
Other		531			(421	)
CASH USED IN INVESTING ACTIVITIES:		(429,019	)		(23,230	)
FINANCING ACTIVITIES:
Repayments of long-term debt		(51,403	)		(62,085	)
Borrowing of long-term debt		479,837			20,000
Tax withholding payments for share-based compensation		(1,056	)		(1,477	)
Proceeds from issuance of common stock		207			0
Debt Issuance Costs		(8,757	)		(1,418	)
Dividends paid		(11,602	)		(11,571	)
Repurchase of common stock		(14,485	)		(81,061	)
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES:		392,741			(137,612	)
Net cash provided by / (used) in operating, investing and financing activities		22,398			(92,933	)
Effect of exchange rate changes on cash		(2,104	)		5,369
CASH AND CASH EQUIVALENTS:
Net change during the period		20,294			(87,564	)
Balance at beginning of period		87,037			165,672
Balance at end of period	$	107,331		$	78,108

See accompanying notes to consolidated condensed financial statements.

-6-

INTERFACE, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

NOTE 1 – CONDENSED FOOTNOTES

As contemplated by the Securities and Exchange Commission (the “Commission”) instructions to Form 10-Q, the following footnotes have been condensed and, therefore, do not contain all disclosures required in connection with annual financial statements. Reference should be made to the Company’s year-end consolidated financial statements and notes thereto contained in its Annual Report on Form 10-K for the fiscal year ended December 31, 2017, as filed with the Commission.

The financial information included in this report has been prepared by the Company, without audit. In the opinion of management, the financial information included in this report contains all adjustments (all of which are normal and recurring) necessary for a fair presentation of the results for the interim periods. Nevertheless, the results shown for interim periods are not necessarily indicative of results to be expected for the full year. The December 31, 2017, consolidated condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States.

Certain prior period amounts have been reclassified to conform to the current period presentation. There was no change to consolidated assets, liabilities, cash flows or net income as a result of these reclassifications.

NOTE 2 – REVENUE RECOGNITION

Effective January 1, 2018, the Company adopted a new accounting standard with regard to revenue from customers. The Company elected the modified retrospective approach for adoption of this new standard, as is allowed by the standard. The Company did not have any significant impact from this standard as of the date of the adoption.

Revenue Recognized from Contracts with Customers

100% of the Company’s revenue is due to contracts with its customers. These contracts typically take the form of invoices for purchase of materials from the Company. The performance obligation is the delivery of these materials to customer control. Nearly 97% of the Company’s current revenue is produced from the sale of carpet, resilient flooring and related products (TacTiles installation materials, etc.) and the revenue from sales of these products is recognized upon shipment, or in certain cases upon delivery to the customer.  The transaction price for these sales is readily identifiable.

The remaining revenue generated by the Company is for contracts to sell and install carpet and related products at customer locations. For projects underway, the Company recognized installation revenue over time as the customer simultaneously received and consumed the benefit of the services. The installation of the carpet and related products is a separate performance obligation from the sale of carpet. The majority of these projects are completed within 5 days of the start of installation. The transaction price for these sale and installation contracts is readily determinable between flooring material and installation services and is specifically identified in the contract with the customer.

The Company has utilized the portfolio approach to its contracts with customers, as its contracts with customers have similar characteristics and it is reasonable to expect that the effects from applying this approach are not materially different from applying the accounting standard to individual contracts.

The Company does not have any other significant revenue streams outside of these sales of flooring material, and the sale and installation of flooring material, as described above.

Impairment Losses

The Company does not recognize any impairment losses related to its revenue contracts due primarily to the short-term and straightforward nature of these contracts.

-7-

Disaggregation of Revenue

For the first nine months ended September 30, 2018, revenue from the Company’s customers is broken down by geography as follows:

Geography	Percentage of Net Sales
Americas		58.7%
Europe		26.2%
Asia-Pacific		15.1%

Revenue from sales of carpet, modular resilient flooring, rubber flooring, and other flooring-related material was approximately 97% of total revenue for the nine months ended September 30, 2018. The remaining 3% of revenue was generated from the installation of carpet and other flooring-related material.

Performance Obligations

As noted above, the Company primarily generates revenue through the sale of flooring material to end users either upon shipment or upon arrival of the product at its destination. In these instances, there typically is no other obligation to the customers other than the delivery of flooring material with the exception of warranty. The Company does offer a warranty to its customers which guarantees certain on-floor performance characteristics and warrants against manufacturing defects. The warranty is not a service warranty, and there is no ability to separate the warranty obligation from the sale of the carpet or purchase them separately. The Company’s incidence of warranty claims is extremely low, with approximately 0.2% of revenue in claims on an annual basis for the last three fiscal years. Given the nature of the warranty as well as the financial impact, the Company has determined that there is no need to identify this warranty as a separate performance obligation and the Company will continue to account for warranty on an accrual basis.

For the Company’s installation business, the sales of carpet and other flooring materials and installation services are separate deliverables which under the revenue recognition requirements should be characterized as separate performance obligations. The Company historically has not separated these obligations and has accounted for these installation projects on a completed contract basis. The nature of the installation projects is such that the vast majority – an amount in excess of 90% of these installation projects – are completed in less than 5 days. The Company’s largest installation customers are retail and corporate customers, and these are on a project-by-project basis and are short term installations. The impact of bifurcating the carpet sale from the installation sale is not considered to be material to the total Company. The Company has, however, evaluated these projects at the end of the reporting period and recorded revenue in accordance with the accounting standards for projects which were underway as of the end of the third quarter of 2018.   

Costs to Obtain Contracts

The Company pays sales commissions to many of its sales personnel based upon their selling activity. These are direct costs associated with obtaining the contracts. Under the accounting standard, these costs should be expensed as the revenue is earned. As these commissions become payable upon shipment (or in certain cases delivery) of product, the commission is earned as the revenue is recognized. Due to this fact pattern, there is no change to the Company’s accounting for these selling commissions. There are no other material costs the Company incurs as part of obtaining the sales contract.

NOTE 3– INVENTORIES

Inventories are summarized as follows:

	September 30, 2018		December 31, 2017
	(In thousands)
Finished Goods	$	197,869	$	115,512
Work in Process		15,838		13,022
Raw Materials		65,108		49,401
Total Inventory	$	278,815	$	177,935

-8-

NOTE 4 – EARNINGS PER SHARE

The Company computes basic earnings per share (“EPS”) by dividing net income by the weighted average common shares outstanding, including participating securities outstanding, during the period as discussed below.  Diluted EPS reflects the potential dilution beyond shares for basic EPS that could occur if securities or other contracts to issue common stock were exercised, converted into common stock or resulted in the issuance of common stock that would have shared in the Company’s earnings.

The Company includes all unvested stock awards which contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid, in the number of shares outstanding in our basic and diluted EPS calculations when the inclusion of these shares would be dilutive. Unvested share-based awards of restricted stock are paid dividends equally with all other shares of common stock. As a result, the Company includes all outstanding restricted stock awards in the calculation of basic and diluted EPS. Distributed earnings include common stock dividends and dividends earned on unvested share-based payment awards. Undistributed earnings represent earnings that were available for distribution but were not distributed. The following tables show distributed and undistributed earnings:

	Three Months Ended				Nine Months Ended
	September 30, 2018		October 1, 2017		September 30, 2018		October 1, 2017
Earnings Per Share:
Basic Earnings Per Share:
Distributed Earnings	$	0.07	$	0.07	$	0.20	$	0.19
Undistributed Earnings		0.07		0.25		0.54		0.59
Total	$	0.14	$	0.32	$	0.74	$	0.78
Diluted Earnings Per Share:
Distributed Earnings	$	0.07	$	0.07	$	0.20	$	0.19
Undistributed Earnings		0.07		0.25		0.54		0.59
Total	$	0.14	$	0.32	$	0.74	$	0.78
Basic earnings per share	$	0.14	$	0.32	$	0.74	$	0.78
Diluted earnings per share	$	0.14	$	0.32	$	0.74	$	0.78

The following tables present net income that was attributable to participating securities:

	Three Months Ended				Nine Months Ended
	September 30, 2018		October 1, 2017		September 30, 2018		October 1 2017
			(In millions)
Net Income Attributable to Participating Securities	$	0.1	$	0.1	$	0.4	$	0.4

The weighted average shares outstanding for basic and diluted EPS were as follows:

	Three Months Ended				Nine Months Ended
	September 30, 2018		October 1, 2017		September 30, 2018		October 1, 2017
			(In thousands)
Weighted Average Shares Outstanding		58,917		60,555		58,974		62,167
Participating Securities		579		463		579		463
Shares for Basic Earnings Per Share		59,496		61,018		59,553		62,630
Dilutive Effect of Stock Options		40		42		41		42
Shares for Diluted Earnings Per Share		59,536		61,060		59,594		62,672

For all periods presented, there were no options or participating securities excluded from the computation of diluted EPS.

-9-

NOTE 5 – LONG-TERM DEBT

Syndicated Credit Facility

On August 7, 2018, the Company amended and restated its syndicated credit facility (the “Facility”) in connection with the nora Holding GmbH (“nora”) acquisition. The purpose of the amended and restated Facility was to fund the nora purchase price and related fees and expenses of the acquisition, and to increase the credit available to the Company and its subsidiaries following the closing of the nora acquisition in view of the larger enterprise. At September 30, 2018, the amended and restated Facility provided to the Company and certain of its subsidiaries a multicurrency revolving loan and U.S. denominated and multicurrency term loans. Interest on base rate loans was charged at varying rates computed by applying a margin depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter. Interest on LIBOR-based loans and fees for letters of credit were charged at varying rates computed by applying a margin over the applicable LIBOR rate, depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter. In addition, the Company paid a commitment fee per annum (depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter) on the unused portion of the Facility.

In connection with the amended and restated Facility as discussed above, the Company recorded $8.8 million of debt issuance costs associated with the new term loans that are reflected as a reduction of long-term debt in accordance with applicable accounting standards.  As these fees are expensed over the life of the outstanding borrowing the debt balance will increase by the same amount as the fees that are expensed.

As of September 30, 2018, the Company had outstanding $625.2 million of term loan borrowing and $32.1 million of revolving loan borrowings under the Facility, and had $3.6 million in letters of credit outstanding under the Facility. As of September 30, 2018, the weighted average interest rate on borrowings outstanding under the Facility was 3.70%.

Under the amended and restated Facility, the Company is required to make quarterly amortization payments of the term loan borrowings, which commence in the fourth quarter of 2018. The amortization payments are due on the last day of the calendar quarter. There was no required quarterly amortization payment for the third quarter of 2018.

The Company is currently in compliance with all covenants under the Facility and anticipates that it will remain in compliance with the covenants for the foreseeable future.

Other Lines of Credit

Subsidiaries of the Company have an aggregate of the equivalent of $9.6 million of other lines of credit available at interest rates ranging from 2.5% to 6.5%. As of September 30, 2018, there were no borrowings outstanding under these lines of credit. 

NOTE 6 – DERIVATIVE INSTUMENTS

 Interest Rate Risk Management

In the third quarter of 2017, the Company entered into an interest rate swap transaction to fix the variable interest rate on a portion of its term loan borrowing in order to manage a portion of its exposure to interest rate fluctuations. The Company’s objective and strategy with respect to this interest rate swap is to protect the Company against adverse fluctuations in interest rates by reducing its exposure to variability to cash flows relating to interest payments on a portion of its outstanding debt. The Company is meeting its objective by hedging the risk of changes in its cash flows (interest payments) attributable to changes in LIBOR, the designated benchmark interest rate being hedged (the “hedged risk”), on an amount of the Company’s debt principal equal to the outstanding swap notional amount.

Cash Flow Interest Rate Swap

The Company’s interest rate swap is designated and qualifies as a cash flow hedge of forecasted interest payments. The Company reports the effective portion of the fair value gain or loss on the swap as a component of other comprehensive income (or other comprehensive loss). Gains or losses (if any) on any ineffective portion of derivative instruments in cash flow hedging relationships are recorded in the period in which they occur as a component of other expense (or other income) in the Consolidated Condensed Statement of Operations and as a component of operating activities in the Consolidated Condensed Statement of Cash Flows.  The aggregate notional amount of the swap as of September 30, 2018 was $100 million.

-10-

Forward Contracts

The recently acquired nora operations are party to currency forward contracts designed to hedge the cash flow risk of intercompany sales from the manufacturing facility in Europe to the Americas.  The Company’s objective and strategy with respect to these currency forward contracts is to protect the Company against adverse fluctuations in currency rates by reducing its exposure to variability in cash flows related to receipt of payment on intercompany sales.  The Company is meeting its objective by hedging the risk of changes in its cash flows (intercompany payments for inventory) attributable to changes in the U.S. dollar/Euro exchange rate (the “hedged risk”). Changes in fair value attributable to components other than exchange rates will be excluded from the assessment of effectiveness and amortized to earnings on a straight-line basis.  Changes in fair value related to the effective portion of these contracts will be reflected as a component of other comprehensive income (or other comprehensive loss). A portion of these forward contracts expire each month, with the final contract expiring in September of 2019.  These contracts cover approximately 70% of the expected intercompany sales activity between the nora European manufacturing facility and the U.S. subsidiary and at this time the Company believes these are probable transactions given historical performance as well as budget projections.  The current notional value of these forward currency contracts and the future intercompany sales these instruments hedge is approximately $52 million.

The table below sets forth the fair value of derivative instruments as of September 30, 2018 (in thousands):

	Asset Derivatives as of			Liability Derivatives as of
	September 30, 2018			September 30, 2018
	Balance Sheet			Balance Sheet
	Location	Fair Value		Location	Fair Value
Derivative instruments designated as hedging instruments:
Foreign currency contracts	Other current assets	$	1,757	Other current liabilities		--
Interest rate swap contract	Other current assets		3,636	Other current liabilities		--
		$	5,393			--

The table below sets forth the fair value of derivative instruments as of December 31, 2017 (in thousands):

	Asset Derivatives as of			Liability Derivatives as of
	December 31, 2017			December 31, 2017
	Balance Sheet			Balance Sheet
	Location	Fair Value		Location	Fair Value
Derivative instruments designated as hedging instruments:
Interest rate swap contract	Other current assets	$	904	Other current liabilities		--

There was no significant impact to earnings from the changes in fair value of derivatives designated as cash flow hedges or from amounts excluded from the assessment of hedge effectiveness during the three and nine months ended September 30, 2018.  There was no significant impact from the reclassification of hedged items from accumulated other comprehensive income during the three and nine months ended September 30, 2018. The amount of hedged items expected to be reclassified from accumulated other comprehensive income in the next 12 months is not significant.

The following tables summarize the pre-tax impact that changes in the fair value of derivatives designated as cash flow hedges and included in the assessment of hedge effectiveness had on accumulated other comprehensive income during the three and nine months ended September 30, 2018 (in thousands):

	Gain (Loss) Recognized in Accumulated
Three months ended September 30, 2018	Other Comprehensive Income
Foreign currency contracts	$	(167	)
Interest rate swap contract	$	453

	Gain (Loss) Recognized in Accumulated
Nine months ended September 30, 2018	Other Comprehensive Income
Foreign currency contracts	$	(167	)
Interest rate swap contract	$	2,732

-11-

NOTE 7 – STOCK-BASED COMPENSATION

Stock Option Awards

In accordance with accounting standards, the Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. That cost will be recognized over the period in which the employee is required to provide the services – the requisite service period (usually the vesting period) – in exchange for the award.

All outstanding stock options vested prior to the end of 2013, and therefore there was no stock option compensation expense in the first nine months of 2018 or 2017.

As of September 30, 2018, there were 62,500 stock options outstanding and exercisable, at an average exercise price of $7.88 per share. There were no stock options granted in 2018 or 2017. There were 20,000 stock options exercised in the first nine months of 2018 and no forfeitures during those nine months. There were no exercises or forfeitures of stock options in the first nine months of 2017. The aggregate intrinsic value of the outstanding and exercisable stock options was $1.0 million as of September 30, 2018.

Restricted Stock Awards

During the nine months ended September 30, 2018 and October 1, 2017, the Company awarded restricted stock to certain employees. Awards of restricted stock (or a portion thereof) vest with respect to each recipient over a one to three-year period from the date of grant, provided the individual remains in the employment or service of the Company as of the vesting date. Additionally, certain awards (or a portion thereof) could vest earlier in the event of a change in control of the Company, or upon involuntary termination without cause.

Compensation expense related to restricted stock grants was $2.9 million and $2.0 million for the nine months ended September 30, 2018 and October 1, 2017, respectively. Accounting standards allow that the Company estimate forfeitures for restricted stock and reduce compensation expense accordingly. The Company has reduced its expense by the assumed forfeiture rate and will evaluate experience against this forfeiture rate going forward.

The following table summarizes restricted stock outstanding as of September 30, 2018, as well as activity during the nine months then ended:

	Restricted Shares		Weighted Average Grant Date Fair Value
Outstanding at December 31, 2017		463,000	$	17.79
Granted		194,000		25.57
Vested		67,000		17.56
Forfeited or canceled		11,000		18.06
Outstanding at September 30, 2018		579,000	$	25.16

As of September 30, 2018, the unrecognized total compensation cost related to unvested restricted stock was $5.6 million. That cost is expected to be recognized by the end of 2021.

Performance Share Awards

During the nine months ended September 30, 2018 and October 1, 2017, the Company issued awards of performance shares to certain employees. These awards vest based on the achievement of certain performance-based goals over a performance period of one to three years, subject to the employee’s continued employment through the last date of the performance period, and will be settled in shares of our common stock or in cash at the Company’s election. The number of shares that may be issued in settlement of the performance shares to the award recipients may be greater (up to 200%) or lesser than the nominal award amount depending on actual performance achieved as compared to the performance targets set forth in the awards.

-12-

The following table summarizes the performance shares outstanding as of September 30, 2018, as well as the activity during the nine months then ended:

	Performance Shares		Weighted Average Grant Date Fair Value
Outstanding at December 31, 2017		669,500	$	17.51
Granted		261,000		25.69
Vested		119,000		17.78
Forfeited or canceled		20,000		18.05
Outstanding at September 30, 2018		791,500	$	20.15

Compensation expense related to performance shares was $6.3 million and $2.4 million for the nine months ended September 30, 2018, and October 1, 2017, respectively. Unrecognized compensation expense related to these performance shares was approximately $5.9 million as of September 30, 2018. That cost is expected to be recognized by the end of 2021.

The tax benefits recognized with regard to restricted stock and performance shares were approximately $1.8 million for the nine months ended September 30, 2018.

NOTE 8 – EMPLOYEE BENEFIT PLANS

The following tables provide the components of net periodic benefit cost for the three-month and nine-month periods ended September 30, 2018, and October 1, 2017, respectively:

	Three Months Ended						Nine Months Ended
Defined Benefit Retirement Plan (Europe)	September 30, 2018			October 1, 2017			September 30, 2018			October 1, 2017
	(In thousands)						(In thousands)
Service cost	$	178		$	423		$	547		$	1,204
Interest cost		1,270			1,426			3,941			4,138
Expected return on assets		(1,503	)		(1,697	)		(4,667	)		(4,920	)
Amortization of prior service costs		(11	)		9			4			26
Recognized net actuarial (gains) / losses		270			318			839			930
Net periodic benefit cost	$	204		$	479		$	664		$	1,378

	Three Months Ended				Nine Months Ended
Salary Continuation Plan (SCP)	September 30, 2018		October 1, 2017		September 30, 2018		October 1, 2017
	(In thousands)				(In thousands)
Service cost	$	0	$	0	$	0	$	0
Interest cost		271		314		812		942
Amortization of prior service cost		0		0		0		0
Amortization of (gain) / loss		116		91		348		273
Net periodic benefit cost	$	387	$	405	$	1,160	$	1,215

	Three Months Ended		Nine Months Ended
Nora Defined Benefit Plan	September 30, 2018		September 30, 2018
	(In thousands)		(In thousands)
Service cost	$	134	$	134
Interest cost		99		99
Net periodic benefit cost	$	233	$	233

-13-

NOTE 9 – ACQUISITION OF NORA

    On June 14, 2018, the Company entered into a share purchase and transfer agreement to acquire the issued and outstanding shares of nora, nora’s outstanding third-party debt, and receivables related to nora’s shareholder loans. Nora is the holding company for a Germany-based manufacturer and multinational marketer of resilient floor coverings, including rubber flooring. In connection with the signing of the nora share purchase and transfer agreement, the Company entered into a derivative instrument to address the foreign currency risk associated with a portion of the nora purchase price. This option instrument did not qualify for hedge accounting, and the mark-to-market expense of $2.8 million to record the instrument at fair value at the end of the second quarter of 2018 was recorded in other expense in our consolidated condensed statement of operations during the second quarter. The option instrument had a notional value of €315 million (or approximately $364 million as of the end of the second quarter of 2018) and an initial maturity of 120 days. Upon completion of the nora acquisition as discussed below, the option instrument was terminated and the Company recognized a loss of approximately $1.4 million upon termination, which was recorded in other expense in our Consolidated Condensed Statement of Operations during the third quarter of 2018.

   On August 7, 2018, the Company completed the acquisition of nora for a purchase price of €385.1 million, or $447.2 million at the exchange rate as of the transaction date, including acquired cash of €40.0 million ($46.5 million) for a net purchase price of €345.1 million ($400.7 million).

Nora is an industry leader in the rubber flooring market, and this acquisition is expected to advance the Company’s growth strategy in growing market segments, particularly in the healthcare, life sciences and education market segments.  Similar to Interface, nora operates on an international footprint and the Company expects the acquisition will also allow for geographic sales synergies as well. 

 The transaction will be accounted for as a business combination using the acquisition method of accounting, which requires, among other things, that assets acquired and liabilities assumed be recorded at their fair market values as of the acquisition date. The results of operations for this acquisition have been consolidated with those of the Company from the acquisition date forward.  Tangible assets and liabilities of nora systems GmbH were valued as of the acquisition date using a market analysis, and intangible assets were valued using a discounted cash flow analysis.

       The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date. The amounts represent a provisional measurement of the fair values, and is therefore subject to change:

	As of August 7th, 2018
	(In thousands)
Cash	$	46,495
Accounts receivables		30,996
Inventories		93,352
Other assets and prepaids		5,616
Property plant and equipment		79,538
Intangible assets		103,338
Total identifiable assets acquired		359,335
Current liabilities		(27,285	)
Deferred taxes		(29,277	)
Other long-term liabilities		(38,929	)
Total liabilities assumed		(95,491	)
Net identifiable assets acquired		263,844
Goodwill		183,348
Net assets acquired / cash paid	$	447,192

        Acquired intangibles assets of $103.3 million include $60.8 million of trademarks and tradenames that are not subject to amortization and will instead be subject to annual impairment testing, or more frequent testing should there be a significant change in business conditions. The remaining intangible assets include developed technology of $39.1 million that will be amortized on a straight-line basis over the estimated useful life of 7 years and backlog of $3.4 million that will be amortized on a straight-line basis over the estimated useful life of six months. The inventory amount above includes a step-up of inventory to fair value of approximately $26.6 million which will be recognized in earnings over the expected turns of the inventory. This step-up of inventory to fair value will be fully amortized by the end of 2018.

-14-

       As of September 30, 2018, the balances, net of accumulated amortization where applicable, of the acquired intangible assets from the nora acquisition were (in thousands):

Developed technology	$	38,048
Trademarks and tradenames		59,880
Backlog		2,252
Goodwill		183,348

       As of September 30, 2018, the recognized goodwill of $183.3 million and acquired intangible assets, net of amortization of $100.2 million, were assigned pro-rata to the Company’s three operating segments. None of the goodwill is expected to be deductible for income tax purposes.

The fair value of acquired accounts receivable was $30.1 million with the gross value being $31.9 million. The Company expects $1.8 million to be uncollectible.

       The Company recognized $8.2 million of transaction costs related to the nora acquisition for the nine months ended September 30, 2018. Approximately $4.0 million of these expenses are included in selling, general and administrative expenses in the consolidated condensed statement of operations and $4.2 million are included in other expenses related to the derivative instrument the Company used to address the foreign currency risk associated with a portion of the nora purchase price. The Company also recognized $8.8 million of debt issuance costs in connection with the amended and restated credit facility, which were recorded as a reduction of long-term debt in the consolidated condensed balance sheet.

     The amounts of revenue and net loss of nora included in the Company’s consolidated condensed statements of operations from the acquisition date to September 30, 2018 are as follows (in thousands):

Revenue	$	41,159
Net loss		(12,455	)

       The following represents the pro forma consolidated condensed statement of operations as if nora had been included in the consolidated results of the Company as of January 1, 2017. These are estimated for pro forma purposes only and do not necessarily reflect the results had nora been included as of the beginning of 2018 and 2017.

	Pro Forma Consolidated Statement of Operations
	(In thousands)
	Nine months ended		Nine months ended
	September 30, 2018		October 1, 2017
Revenue	$	1,001,919	$	929,521
Net income		74,390		38,793

       Pro forma net income for the nine months ended September 30, 2018, excludes any transaction related costs as these are non-recurring costs for the combined Company.

NOTE 10 – SEGMENT INFORMATION

Based on applicable accounting standards, the Company has determined that it has three operating segments – namely, the Americas, Europe and Asia-Pacific geographic regions. Pursuant to accounting standards, the Company has aggregated the three operating segments into one reporting segment because they have similar economic characteristics, and the operating segments are similar in all of the following areas: (a) the nature of the products and services; (b) the nature of the production processes; (c) the type or class of customer for their products and services; (d) the methods used to distribute their products or provide their services; and (e) the nature of the regulatory environment. Nora results are included in the 2018 figures as of the date of acquisition through the end of the third quarter of 2018, and are included in our operating segments based on the geographic split of the operations.

-15-

While the Company operates as one reporting segment for the reasons discussed, included below is selected information on our operating segments.

	AMERICAS		EUROPE		ASIA- PACIFIC		TOTAL
	(in thousands)
Three Months Ended September 30, 2018:
Net Sales	$	182,660	$	88,223	$	47,442	$	318,325
Depreciation and amortization		3,373		3,181		2,144		8,698
Total assets		472,473		587,228		201,611		1,261,312
Three Months Ended October 1, 2017:
Net Sales	$	148,082	$	66,677	$	42,672	$	257,431
Depreciation and amortization		3,386		1,646		2,211		7,243
Nine Months Ended September 30, 2018:
Net Sales	$	494,265	$	220,645	$	127,604	$	842,514
Depreciation and amortization		10,464		7,483		6,564		24,511
Nine Months Ended October 1, 2017:
Net Sales	$	433,461	$	180,506	$	116,266	$	730,233
Depreciation and amortization		10,064		4,257		6,458		20,779

A reconciliation of the Company’s total operating segment depreciation and amortization, and assets, to the corresponding consolidated amounts follows:

	Three Months Ended
DEPRECIATION AND AMORTIZATION	September 30, 2018		October 1, 2017
	(In thousands)
Total segment depreciation and amortization	$	8,698	$	7,243
Corporate depreciation and amortization, and other		1,179		539
Reported depreciation and amortization	$	9,877	$	7,782

	Nine Months Ended
DEPRECIATION AND AMORTIZATION	September 30, 2018		October1, 2017
	(In thousands)
Total segment depreciation and amortization	$	24,511	$	20,779
Corporate depreciation and amortization, and other		2,556		1,424
Reported depreciation and amortization	$	27,067	$	22,203

-16-

ASSETS	September 30, 2018
	(In thousands)
Total segment assets	$	1,261,312
Corporate assets and eliminations		81,648
Reported total assets	$	1,342,960

NOTE 11 – SUPPLEMENTAL CASH FLOW INFORMATION

Cash payments for interest amounted to $7.4 million and $4.6 million for the nine months ended September 30, 2018 and October 1, 2017, respectively. Income tax payments amounted to $21.2 million and $14.8 million for the nine months ended September 30, 2018 and October 1, 2017, respectively.

NOTE 12 – RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In February 2016, the Financial Accounting Standards Board (“FASB”) issued a new accounting standard regarding leases. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact of our pending adoption of the new standard on our consolidated financial statements, but the standard will result in the Company recording both assets and liabilities for leases currently classified as operating leases.

In January 2017, the FASB issued a new accounting standard that provides for the elimination of Step 2 from the goodwill impairment test. Under the new guidance, impairment charges are recognized to the extent the carrying amount of a reporting unit exceeds its fair value with certain limitations. The new guidance is effective for any annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company does not anticipate that the adoption of the new guidance will have a material effect on its consolidated financial statements.

In August 2017, the FASB issued a new accounting standard to improve the accounting for hedging activities. This standard will eliminate the requirement to separately measure and report hedge ineffectiveness and requires companies to recognize all elements of hedge accounting that impact earnings in the same line item in the statement of income where the hedged item is reported. The amendments ease the requirements for effectiveness testing and permit an entity to perform qualitative hedge effectiveness assessments. The new guidance is effective for interim and annual periods beginning after December 15, 2018. Early adoption is permitted. The Company has elected to early adopt this standard in the third quarter of 2018 and there was no material effect on its consolidated financial statements.

In February 2018, the FASB issued a new accounting standard to address a narrow-scope financial reporting issue that arose as a consequence of the U.S. Tax Cuts and Jobs Act. Existing guidance requires that deferred tax liabilities and assets be adjusted for a change in tax laws or rates with the effect included in income from continuing operations in the reporting period that includes the enactment date. That guidance is applicable even in situations in which the related income tax effects of items in accumulated other comprehensive income were originally recognized in other comprehensive income (rather than in net income), such as amounts related to benefit plans and hedging activity. As a result, the tax effects of items within accumulated other comprehensive income do not reflect the appropriate tax rate (the difference is referred to as stranded tax effects). The new guidance allows for a reclassification of these amounts to retained earnings, thereby eliminating these stranded tax effects. The new guidance is effective for interim and annual periods beginning after December 15, 2018. The Company is currently evaluating the impact of adoption of this standard on its consolidated financial statements.

In June 2018, the FASB issued a new accounting standard to address non-employee share-based payments. This standard will require that the accounting treatment for non-employee share-based payments for goods or services be consistent with current GAAP for employee share-based payments, including measurement of awards at grant-date fair value and the application of probability to evaluate performance conditions. This standard will also eliminate the current GAAP requirement to reassess the classification of non-employee share-based payments awards upon vesting. The new guidance is effective for interim and annual periods beginning after December 15, 2018. Early adoption is permitted. The Company is currently evaluating the impact of adoption of this standard, but does not anticipate that the adoption will have a material effect on its consolidated financial statements.

-17-

In August 2018, the FASB issued a new accounting standard that modifies disclosure requirements related to fair value measurements. This standard eliminates the current requirement to disclose the amount or reason for transfers between level 1 and level 2 of the fair value hierarchy and the requirement to disclose the valuation methodology for level 3 fair value measurements. The standard includes additional disclosure requirements for level 3 fair value measurements, including the requirement to disclose the changes in unrealized gains and losses in other comprehensive income during the period and permits the disclosure of other relevant quantitative information for certain unobservable inputs. The new guidance is effective for interim and annual periods beginning after December 15, 2019. Early adoption is permitted. The Company does not anticipate that the adoption of the new standard will have a material effect on its consolidated financial statements.

In August 2018, the FASB issued a new accounting standard that changes the disclosure requirements for defined benefit retirement plans. This standard eliminates the current requirement to disclose amounts in accumulated other comprehensive income that are expected to be recognized in net periodic benefit expense in the next fiscal year. The standard requires additional disclosures for an entity to explain the reasons for significant gains and losses related to changes in the benefit obligation for the period and clarifies current guidance for disclosures where projected benefit obligations or accumulated benefit obligations exceed the fair value of plan assets. The new guidance is effective for annual periods ending after December 15, 2020. Early adoption is permitted. The Company does not anticipate that the adoption of the new standard will have a material effect on its consolidated financial statements.

In August 2018, the FASB issued a new accounting standard to align the requirements for capitalizing implementation costs incurred in a hosting arrangement service contract with the guidance to capitalize implementation costs of internal use software. This standard requires that the costs for implementation activities during the application development phase be capitalized in a hosting arrangement service contract, and costs during the preliminary and post implementation phase are expensed. The new guidance is effective for interim and annual periods beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact of adoption of this standard, but does not anticipate that the adoption will have a material effect on its consolidated financial statements.

NOTE 13– INCOME TAXES

On December 22, 2017, the U.S. Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Company is continuing to evaluate the Tax Act and its requirements, as well as its application to our business and its impact on our effective tax rate.

The Company is applying the guidance to address the accounting for income taxes under accounting standards in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Act.  Accounting standards provide a reasonable “measurement period” not to exceed twelve months from the date of enactment to complete the accounting of these provisional estimates.  As disclosed in the Company’s Annual report on Form 10-K for the fiscal year ended December 31, 2017, two material provisional estimates that impacted the Company were the U.S. statutory rate reduction and the one-time transition tax. These amounts were considered provisional because they used reasonable estimates for taxes with respect to which tax returns had not been filed and because estimated amounts may be impacted by future regulatory and accounting guidance if and when issued. 

For the nine months ended September 30, 2018, there were no significant changes to the Company’s provisional estimates of the income tax effects reflected in 2017 for the changes in tax law and tax rate from the enactment of the Tax Act. The impact of tax law changes on the Company’s financial statements could differ from its reasonable estimates due to further analysis of the new law, regulatory guidance, technical corrections, legislation, or guidance under U.S. generally accepted accounting principles. If significant changes occur, the Company will provide updated information in connection with future regulatory filings or the Company will adjust these provisional amounts as further information becomes available and as we refine our calculations.

During the nine months ended September 30, 2018, the Company’s effective tax rate was favorably impacted by the reduction in the U.S. statutory tax rate due to the enactment of the Tax Act. This favorable impact was partially offset by certain base broadening provisions of the Tax Act. For the nine months ended September 30, 2018, our effective tax rate was 24%, as compared to 32% for the first nine month of 2017.

-18-

Accounting standards require that all tax positions be analyzed using a two-step approach. The first step requires an entity to determine if a tax position is more-likely-than-not to be sustained upon examination. In the second step, the tax benefit is measured as the largest amount of benefit, determined on a cumulative probability basis, that is more-likely-than-not to be realized upon ultimate settlement. In the first nine months of 2018, the Company decreased its liability for unrecognized tax benefits by $1.0 million. As of September 30, 2018, the Company had accrued approximately $28.2 million for unrecognized tax benefits. In accordance with applicable accounting standards, the Company’s deferred tax asset as of September 30, 2018 reflects a reduction for $3.3 million of these unrecognized tax benefits.

NOTE 14 – ITEMS RECLASSIFIED FROM OTHER COMPREHENSIVE INCOME

During the first nine months of 2018, the Company did not reclassify any significant amounts out of accumulated other comprehensive income. The reclassifications that occurred in that period were primarily comprised of $1.2 million related to the Company’s defined benefit retirement plan and salary continuation plan. These reclassifications were included in the other expense line item of the Company’s consolidated condensed statement of operations.

NOTE 15– REPURCHASE OF COMMON STOCK

In 2017, the Company adopted a new share repurchase program in which the Company is authorized to repurchase up to $100 million of its outstanding shares of common stock. The program has no specific expiration date.

During the first nine months of 2018, the Company repurchased and retired 615,000 shares of common stock at a weighted average price of $23.54 per share pursuant to this share repurchase program.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Our discussions below in this Item 2 are based upon the more detailed discussions about our business, operations and financial condition included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, under Item 7 of that Form 10-K. Our discussions here focus on our results during the quarter and nine months ended, or as of, September 30, 2018, and the comparable periods of 2017 for comparison purposes, and, to the extent applicable, any material changes from the information discussed in that Form 10-K or other important intervening developments or information since that time. These discussions should be read in conjunction with that Form 10-K for more detailed and background information.

Forward-Looking Statements

This report contains statements which may constitute “forward-looking statements” within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Important factors currently known to management that could cause actual results to differ materially from those in forward-looking statements include risks and uncertainties associated with economic conditions in the commercial interiors industry as well as the risks and uncertainties discussed under the heading “Risk Factors” included in Item 1A of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017, as updated by the additional risk factor included in Item 1A of Part II of the Quarterly Report on Form 10-Q for the quarter ended July 1, 2018, which discussions are hereby incorporated by reference. The Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.

Acquisition of Nora Systems

On June 14, 2018, we entered into a Share Purchase and Transfer Agreement (the “Purchase Agreement”) to acquire all of the shares of nora Holding GmbH (“nora”), nora’s outstanding third-party debt, and receivables related to nora’s shareholder loans, based on an enterprise value of €385 million (or approximately $447 million). On August 7, 2018, we completed the acquisition of nora for a purchase price of €385.1 million, or $447.2 million, at the exchange rate as of the transaction date, including acquired cash of €40.0 million ($46.5 million) for a net purchase price of €345.1 million ($400.7 million). Nora is the holding company for a Germany-based manufacturer and multinational marketer of resilient floor coverings, including rubber flooring.

-19-

The sellers have made certain fundamental warranties regarding the ownership of the shares and shareholder receivables and similar matters as set forth in the Purchase Agreement. In addition, the Purchase Agreement contains customary warranties regarding the business of nora and its subsidiaries, including warranties regarding their financial statements, operations, employment matters, employee benefits, pension matters, compliance with laws, taxes, real property, intellectual property, IT systems, insurance, litigation and other customary warranties.

We have also obtained a policy for warranty and indemnity insurance, which provides coverage for certain breaches of warranties of the sellers contained in the Purchase Agreement, subject to certain deductibles, exclusions, policy limits and certain other terms and conditions. Pursuant to the Purchase Agreement, we can make certain claims against the sellers for breaches of warranties contained therein, to the extent not insured by the warranty and indemnity insurance, subject to certain thresholds, caps and other limitations set forth therein.

General

During the quarter ended September 30, 2018, net sales were $318.3 million, compared with net sales of $257.4 million in the third quarter last year.  During the first nine months of fiscal year 2018, net sales were $842.5 million, compared with net sales of $730.2 million in the first nine months of last year. The 2018 periods were both positively impacted by growth in carpet tile and LVT plus the inclusion of revenue from the nora acquisition, which generated net sales of $41.2 million from August 7 through the end of the third quarter of 2018, which was the period that nora was included in Interface’s results. Fluctuations in currency exchange rates had a negative impact of approximately $2.9 million for the third quarter of 2018 and a positive impact of $12.1 million for the nine-month period of 2018 compared to the three-month and nine-month periods of 2017. The three-month period impact was primarily a result of the weakening of the Australian dollar and the Euro against the U.S. dollar. The nine-month period impact was primarily a result of a strengthening of the Euro and British Pound against the U.S. dollar.

During the third quarter of 2018, net income was $8.2 million, or $0.14 per diluted share, compared with $19.4 million, or $0.32 per diluted share, in the third quarter last year. During the nine months ended September 30, 2018, we had net income of $43.9 million, or $0.74 per diluted share, compared with net income of $48.9 million, or $0.78 per diluted share, in the first nine months of 2017. The 2018 periods included the results of the acquired nora business from August 7 through the end of the third quarter of 2018. These results included amortization related to the fair value of inventory acquired of $17.8 million, and amortization of acquired intangible assets of $2.4 million. Also included in our results for the three and nine months ended September 30, 2018 were $2.4 million and $8.2 million, respectively, of pre-tax transaction related expenses. These costs were incurred in the second and third quarters of 2018. Our 2018 net income was positively impacted by the reduction in the U.S. statutory tax rate due to the U.S. Tax Cuts and Jobs Act enacted in the fourth quarter of 2017. As a continuation of the plans announced in the fourth quarter of 2016, the first nine months of 2017 included $7.3 million of restructuring and asset impairment charges, primarily related to closing the majority of our FLOR specialty retail stores.

Results of Operations

The following table presents, as a percentage of net sales, certain items included in our Consolidated Condensed Statements of Operations for the three-month and nine-month periods ended September 30, 2018, and October 1, 2017, respectively:

	Three Months Ended						Nine Months Ended
	September 30, 2018			October 1, 2017			September 30, 2018			October 1, 2017
Net sales		100.0	%		100.0	%		100.0	%		100.0	%
Cost of sales		68.6			61.7			64.1			61.1
Gross profit on sales		31.4			38.3			35.9			38.9
Selling, general and administrative expenses		26.4			26.1			27.3			26.9
Restructuring and asset impairment charges		0.0			0.0			0.0			1.0
Operating income		5.0			12.2			8.6			11.0
Interest/Other expenses		2.0			1.1			1.7			1.1
Income before tax expense		2.9			11.0			6.9			9.9
Income tax expense		0.4			3.5			1.7			3.2
Net income		2.6			7.6			5.2			6.7

-20-

Net Sales

Below we provide information regarding net sales and analyze those results for the three-month and nine-month periods ended September 30, 2018 and October 1, 2017, respectively.

	Three Months Ended				Percentage
	September 30, 2018		October 1, 2017		Change
	(In thousands)
Net Sales	$	318,325	$	257,431		23.7	%

	Nine Months Ended				Percentage
	September 30, 2018		October 1, 2017		Change
	(In thousands)
Net Sales	$	842,514	$	730,233		15.4	%

For the quarter ended September 30, 2018, net sales increased $60.9 million (23.7%) versus the comparable period in 2017. As discussed above, the 2018 period included revenue of $41.2 million from the nora acquisition that was not present in 2017. Currency fluctuations had an approximately $2.9 million (1.1%) negative impact on third quarter 2018 sales compared to the third quarter of 2017. This currency impact was most pronounced in our Asia-Pacific operations, due to the weakening of the Australian dollar and Euro against the U.S. dollar. On a geographic basis, including the impact of the nora acquisition, sales in the Americas increased 23%, Europe increased 32% (34% in local currency) and Asia-Pacific increased 11%. The increase in the Americas was attributable to sales of our carpet tile and luxury vinyl tile (“LVT”) as well as the impact of the nora acquisition. The Americas sales increase was most pronounced in the corporate office, retail and residential segments, as well as continued growth in the hospitality segment for the period. The increase in the retail segment was due to increased sales in our InterfaceServices business, which provides flooring installation as well as product sales. Growth in Europe was impacted by the nora acquisition and the continued introduction of our LVT product offering as well as increases in our core modular carpet business offset by the weakening of the Euro. On a segment basis, the Europe sales increase was most significant in the hospitality, healthcare, and residential segments. The sales increase in Asia-Pacific was primarily due to the impact of the nora acquisition, partially offset by the weakening of the Australian dollar and lower sales in China and Australia. The sales increase in Asia-Pacific was primarily within the corporate office segment.

For the nine months ended September 30, 2018, net sales increased $112.3 million (15.4%) versus the comparable period in 2017. As discussed above, the 2018 period included revenue of $41.2 million from the nora acquisition that was not present in 2017. Currency fluctuations had an approximately $12.1 million (1.7%) positive impact on sales in the first nine months of 2018 compared to the first nine months of 2017. This currency impact was most pronounced in our European operations, due to the strengthening of the Euro and British Pound against the U.S. dollar. On a geographic basis, including the impact of the nora acquisition, sales for the nine-month period increased across all geographies with Americas increasing 14%, Europe increasing 22% (15% in local currency) and Asia-Pacific increasing 10%. The Americas sales were negatively impacted by a decline in our FLOR residential business, which closed its specialty retail stores in the first quarter of 2017, offset by increases in sales of our LVT product that was launched in the first quarter of 2017. On a segment basis, the nine-month period sales increase in the Americas was most significant in the corporate office, retail and residential segments. The nine-month period sales increase in Europe was most significant in the corporate office, hospitality and healthcare segments. As in the three-month period ended September 30, 2018 discussed above, the Asia-Pacific nine-month sales increase was primarily in the corporate office segment.

Cost and Expenses

The following tables present our overall cost of sales and selling, general and administrative expenses for the three-month and nine-month periods ended September 30, 2018, and October 1, 2017, respectively:

	Three Months Ended				Percentage
Cost and Expenses	September 30, 2018		October 1, 2017		Change
	(In thousands)
Cost of sales	$	218,380	$	158,887		37.4	%
Selling, general and administrative expenses		84,160		67,233		25.2	%
Total	$	302,540	$	226,120		33.8	%

-21-

	Nine Months Ended				Percentage
Cost and Expenses	September 30, 2018		October 1, 2017		Change
	(In thousands)
Cost of sales	$	539,839	$	445,990		21.0	%
Selling, general and administrative expenses		230,199		196,333		17.2	%
Total	$	770,038	$	642,323		19.9	%

For the quarter ended September 30, 2018, cost of sales increased $59.5 million (37.4%) compared to the third quarter of 2017. Included in third quarter 2018 cost of sales is $44.9 million for nora, which includes amortization related to acquired inventory and intangible assets of $20.3 million. Currency fluctuations had an approximately $1.8 million (1.1%) positive impact on the year-over-year comparison. In absolute dollars, the increase in cost of sales was largely attributable to the increase in sales for the third quarter of 2018, as described above and the impact of purchase price accounting amortization reflected in costs of sales related to the nora acquisition. The increase in cost of sales was higher on a percentage basis, however, than the increase in net sales as a result of delayed productivity initiatives due to increased sales and production volumes, as well as a change in the sales mix for the period weighted more heavily toward the InterfaceServices business. These service sales typically generate a lower gross margin compared to the rest of our operations. As a percentage of sales, our cost of sales increased to 68.6% for the third quarter of 2018 versus 61.7% for the third quarter of 2017. This increase was due to the factors discussed above.

For the nine months ended September 30, 2018, cost of sales increased $93.8 million (21.0%) versus the comparable period in 2017. Included in the first nine months of 2018 cost of sales is $44.9 million for nora, which includes amortization related to acquired inventory and intangible assets of $20.3 million. Currency fluctuations had an approximately $7.1 million (1.7%) negative impact on the year-over-year comparison. The increase for the 2018 nine-month period was due to the same factors for the third quarter discussed above. As a percentage of sales, our cost of sales increased to 64.1% for the 2018 nine-month period versus 61.1% for the comparable 2017 period. This increase as a percentage of sales was a result of the factors discussed above in the three months ended September 30, 2018 comparison, as well as the exit of the FLOR specialty retail stores in the first quarter of 2017.

For the quarter ended September 30, 2018, selling, general and administrative (“SG&A”) expenses increased $16.9 million (25.2%) versus the comparable period in 2017. SG&A expense for the acquired nora business was $11.3 million from August 7 through the end of the third quarter of 2018. Fluctuations in currency rates had a $0.6 million (0.8%) positive impact on the SG&A expense comparison. The increase in SG&A expense was due to transaction costs in connection with the nora acquisition of $1.0 million, higher share-based incentive compensation of $1.0 million due to performance achievement versus plan, higher selling expenses of $6.4 million related to the acquired nora business, higher selling expenses of $2.4 million due to higher sales volume, and higher administrative expenses of $4.9 million due to the nora acquisition. As a percentage of sales, SG&A expenses increased to 26.4% for the third quarter of 2018 compared to 26.1% for the third quarter of 2017.

For the nine months ended September 30, 2018, SG&A expenses increased $33.9 million (17.2%) versus the comparable period in 2017. SG&A expense for the acquired nora business was $11.3 million from August 7 through the end of the third quarter of 2018. Fluctuations in currency rates had a $3.0 million (1.6%) negative impact on the year-over-year SG&A expense comparison. The increase in SG&A expense was due to transaction costs in connection with the nora acquisition of $4.0 million, higher share-based incentive compensation of $4.7 million, higher selling expenses of $6.0 million in our commercial business due to higher sales volume as well as planned enhancements in our selling system, higher selling expense of $6.4 million due to the acquired nora business, and higher administrative expenses of $10.5 million primarily due to the acquired nora business as noted above. These increases were offset by lower marketing expenses due to the centralization of the global marketing function and lower selling costs of $1.2 million due to the exit of the FLOR specialty retail stores as of the end of the first quarter of 2017. As a percentage of sales, SG&A expenses increased to 27.3% for the nine months ended September 30, 2018, compared to 26.9% for the same period in 2017.

Interest Expense

For the three-month period ended September 30, 2018, interest expense increased $3.0 million to $4.9 million, from $1.9 million in the third quarter of 2017. For the nine-month period ended September 30, 2018, interest expense increased $4.0 million to $9.2 million, from $5.2 million in the comparable period last year. The increase is primarily due to the additional debt incurred to complete the nora acquisition, coupled with higher average interest rates on our borrowings in the first nine months of 2018 as compared to 2017.

-22-

Liquidity and Capital Resources

General

At September 30, 2018, we had $107.3 million in cash.  At that date, we had $625.2 million in term loan borrowings, $32.1 million of revolving loan borrowings and $3.6 million in letters of credit outstanding under the Syndicated Credit Facility.  As of September 30, 2018, we had $264.3 million of additional borrowing capacity under our Syndicated Credit Facility.  In addition, we had $9.6 million of additional borrowing capacity available under our other credit facilities in place at other non-U.S. subsidiaries.

On August 7, 2018, our Syndicated Credit Facility was amended and restated in connection with the acquisition of nora. Please see Note 5 and Note 9 in Item 1 for additional information.

Analysis of Cash Flows

As of September 30, 2018, we had $107.3 million in cash, an increase of $20.3 million during the first nine months of the year. The most significant factors in the increase were cash outflows for financing activities, including (1) $51.4 million of cash used to pay down our revolving debt (2) $11.6 million of dividends paid on our common stock, and (3) $14.5 million used to repurchase and retire 615,000 shares of our outstanding common stock. These financing outflows were offset by borrowings of $479.8 million under our amended and restated Syndicated Credit Facility primarily to fund the nora acquisition. Cash outflows for investing activities included (1) $400.7 million of cash used to acquire the nora business and (2) $28.9 million of cash for capital expenditures during the nine-months ended September 2018. Cash flow from operations in the first nine months of 2018 provided $58.7 million, with net income of $43.9 million offset by working capital uses of cash of (1) $5.5 million for increases in receivables, (2) $27.0 million for increases in inventories, and (3) $9.4 million for increases in prepaid expenses and other current assets. These working capital uses of cash were partially offset by an increase in accounts payable and accrued expenses of $11.0 million.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The discussion below in this Item 3 is based upon the more detailed discussions of our market risk and related matters included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, under Item 7A of that Form 10-K. The discussion here focuses on the period ended September 30, 2018, and any material changes from (or other important intervening developments since the time of) the information discussed in that Form 10-K. This discussion should be read in conjunction with that Form 10-K for more detailed and background information.

At September 30, 2018, we recognized a $7.0 million decrease in our foreign currency translation adjustment account compared to December 31, 2017, primarily because of the weakening of the Euro and British Pound against the U.S. dollar as of the end of the third quarter of 2018 compared to the end of 2017.

Sensitivity Analysis. For purposes of specific risk analysis, we use sensitivity analysis to measure the impact that market risk may have on the fair values of our market sensitive instruments. To perform sensitivity analysis, we assess the risk of loss in fair values associated with the impact of hypothetical changes in interest rates and foreign currency exchange rates on market sensitive instruments.

Because the debt outstanding under our Syndicated Credit Facility has variable interest rates based on an underlying prime lending rate or LIBOR rate, we do not believe changes in interest rates would have any significant impact on the fair value of that debt instrument. Changes in the underlying prime lending rate or LIBOR rate would, however, impact the amount of our interest expense. At our current amount of debt outstanding, a 1% increase in the underlying prime rate or LIBOR rate would increase our annual interest expense by approximately $6.5 million. A 1% decrease in the underlying prime rate or LIBOR rate would decrease our annual interest expense by approximately $6.5 million.

As of September 30, 2018, a 10% decrease or increase in the levels of foreign currency exchange rates against the U.S. dollar, with all other variables held constant, would result in a decrease in the fair value of our financial instruments of $13.5 million or an increase in the fair value of our financial instruments of $16.6 million, respectively. As the impact of offsetting changes in the fair market value of our net foreign investments is not included in the sensitivity model, these results are not indicative of our actual exposure to foreign currency exchange risk.

-23-

As of September 30, 2018, a 10% decrease or increase in the fair market value of the Company’s cash flow interest rate swap would lead to a decrease or increase in the recorded asset value of $0.2 million.

ITEM 4. CONTROLS AND PROCEDURES

As of the end of the period covered by this Quarterly Report on Form 10-Q, an evaluation was performed under the supervision and with the participation of our management, including our President and Chief Executive Officer and our Vice President and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Act”), pursuant to Rule 13a-15(b) under the Act. Based on that evaluation, our President and Chief Executive Officer and our Vice President and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this Quarterly Report.

There were no changes in our internal control over financial reporting that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

-24-

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are subject to various legal proceedings in the ordinary course of business, none of which is required to be disclosed under this Item 1.

ITEM 1A. RISK FACTORS

In addition to the other information set forth in this report, you should carefully consider the risk factors disclosed in Item 1A, “Risk Factors,” of our annual report on Form 10-K for the year ended December 31, 2017, as supplemented in our quarterly report on Form 10-Q for the quarter ended July 1, 2018.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table contains information with respect to purchases made by or on behalf of the Company, or any “affiliated purchaser” (as defined in Rule 10b-18(a)(3) under the Securities Exchange Act of 1934), of our common stock during the quarter ended September 30, 2018:

Period(1)	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2)		Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs(2)
July 2-31, 2018		0	$	0		0	$	25,109,272
August 1-31, 2018		0		0		0		25,109,272
September 1-30, 2018(2)		529		23.65		0		25,109,272
Total		529	$	23.65		0	$	25,109,272

⁽¹⁾ The monthly periods identified above correspond to the Company’s fiscal third quarter of 2018, which commenced July 2, 2018 and ended September 30, 2018.

⁽²⁾ Includes shares acquired by the Company from an employee to satisfy income tax withholding obligations in connection with the vesting of previous equity awards.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable

ITEM 5. OTHER INFORMATION

None

-25-

ITEM 6. EXHIBITS

The following exhibits are filed with this report:

EXHIBIT NUMBER		DESCRIPTION OF EXHIBIT
	31.1	Section 302 Certification of Chief Executive Officer.
	31.2	Section 302 Certification of Chief Financial Officer.
	32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. § 1350.
	32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. § 1350.
	101.INS	XBRL Instance Document.
	101.SCH	XBRL Taxonomy Extension Schema Document.
	101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.
	101.LAB	XBRL Taxonomy Extension Label Linkbase Document.
	101.PRE	XBRL Taxonomy Presentation Linkbase Document.
	101.DEF	XBRL Taxonomy Definition Linkbase Document.

-26-

SIGNATURE

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.

	INTERFACE, INC.
Date: November 9, 2018	By:	/s/ Bruce A. Hausmann
		Bruce A. Hausmann
		Vice President
		(Principal Financial Officer)

-27-

EXHIBITS INCLUDED HEREWITH

EXHIBIT NUMBER		DESCRIPTION OF EXHIBIT
	31.1	Section 302 Certification of Chief Executive Officer.
	31.2	Section 302 Certification of Chief Financial Officer.
	32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. § 1350.
	32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. § 1350.
	101.INS	XBRL Instance Document.
	101.SCH	XBRL Taxonomy Extension Schema Document.
	101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.
	101.LAB	XBRL Taxonomy Extension Label Linkbase Document.
	101.PRE	XBRL Taxonomy Presentation Linkbase Document.
	101.DEF	XBRL Taxonomy Definition Linkbase Document.

 -28-

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Jay D. Gould, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Interface, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of 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 9, 2018
	/s/ Jay D. Gould
	Jay D. Gould
	Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Bruce A. Hausmann, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Interface, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of 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 9, 2018
	/s/ Bruce A. Hausmann
	Bruce A. Hausmann
	Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

I, Jay D. Gould, Chief Executive Officer of Interface, Inc. (the “Company”), certify, pursuant to 18 U.S.C. § 1350 as adopted by § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Quarterly Report on Form 10-Q of the Company for the quarterly period ended September 30, 2018 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

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

Date: November 9, 2018
	/s/ Jay D. Gould
	Jay D. Gould
	Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

I, Bruce A. Hausmann, Chief Financial Officer of Interface, Inc. (the “Company”), certify, pursuant to 18 U.S.C. § 1350 as adopted by § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Quarterly Report on Form 10-Q of the Company for the quarterly period ended September 30, 2018 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

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

Date: November 9, 2018
	/s/ Bruce A. Hausmann
	Bruce A. Hausmann
	Chief Financial Officer

XML

Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Nov. 01, 2018
Document Information [Line Items]
Entity Registrant Name	INTERFACE INC
Entity Central Index Key	0000715787
Trading Symbol	tile
Current Fiscal Year End Date	--12-30
Entity Filer Category	Large Accelerated Filer
Entity Current Reporting Status	Yes
Entity Emerging Growth Company	false
Entity Small Business	false
Entity Common Stock, Shares Outstanding (in shares)		59,520,468
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q3
Amendment Flag	false

XML

Consolidated Condensed Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
ASSETS
Cash and cash equivalents	$ 107,331	$ 87,037
Accounts receivable, net	177,766	142,808
Inventories, net	278,815	177,935
Prepaid expenses and other current assets	36,314	23,087
Total current assets	600,226	430,867
Property and equipment, net	292,606	212,645
Deferred tax asset	23,324	18,003
Goodwill and intangible assets, net	353,810	68,754
Other assets	72,994	70,331
Total assets	1,342,960	800,600
Current liabilities:
Accounts payable	69,353	50,672
Accrued expenses	137,862	110,974
Current portion of long-term debt	31,315	15,000
Total current liabilities	238,530	176,646
Long-term debt	617,565	214,928
Deferred income taxes	27,475	6,935
Other	106,410	72,000
Total liabilities	989,980	470,509
Commitments and Contingencies
Shareholders’ equity
Preferred stock	0	0
Common stock	5,951	5,981
Additional paid-in capital	265,300	271,271
Retained Earnings	219,689	187,432
Accumulated other comprehensive loss – foreign currency translation	(85,922)	(78,943)
Accumulated other comprehensive income – cash flow hedges	3,469	904
Accumulated other comprehensive loss – pension liability	(55,507)	(56,554)
Total shareholders’ equity	352,980	330,091
Total liabilities and shareholders’ equity	$ 1,342,960	$ 800,600

XML

Consolidated Condensed Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Oct. 01, 2017	Sep. 30, 2018	Oct. 01, 2017
NET SALES	$ 318,325	$ 257,431	$ 842,514	$ 730,233
Cost of Sales	218,380	158,887	539,839	445,990
GROSS PROFIT ON SALES	99,945	98,544	302,675	284,243
Selling, General and Administrative Expenses	84,160	67,233	230,199	196,333
Restructuring and Asset Impairment Charges	0	0	0	7,299
OPERATING INCOME	15,785	31,311	72,476	80,611
Interest Expense	4,852	1,851	9,207	5,150
Other Expense	1,570	1,051	5,350	3,143
INCOME BEFORE INCOME TAX EXPENSE	9,363	28,409	57,919	72,318
Income Tax Expense	1,191	8,970	14,061	23,394
NET INCOME	$ 8,172	$ 19,439	$ 43,858	$ 48,924
Earnings Per Share – Basic (in dollars per share)	$ 0.14	$ 0.32	$ 0.74	$ 0.78
Earnings Per Share – Diluted (in dollars per share)	$ 0.14	$ 0.32	$ 0.74	$ 0.78
Common Shares Outstanding – Basic (in shares)	59,496	61,018	59,553	62,630
Common Shares Outstanding – Diluted (in shares)	59,536	61,060	59,594	62,672

XML

Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Net Income	$ 8,172	$ 19,439	$ 43,858	$ 48,924
Other Comprehensive Income / (Loss), Foreign Currency Translation Adjustment	4,964	9,848	(6,979)	30,678
Other Comprehensive Income, Cash Flow Hedges	286	0	2,565	0
Other Comprehensive Income / (Loss), Pension Liability Adjustment	(196)	(1,994)	1,047	(4,974)
Comprehensive Income	$ 13,226	$ 27,293	$ 40,491	$ 74,628

XML

Consolidated Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
OPERATING ACTIVITIES:
Net Income	$ 43,858	$ 48,924
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization	27,067	22,203
Stock compensation amortization expense	9,181	4,479
Deferred income taxes and other	(10,705)	5,926
Amortization of acquired intangible assets	2,414	0
Amortization of acquired inventory step-up	17,849	0
Working capital changes:
Accounts receivable	(5,540)	(1,397)
Inventories	(27,037)	(22,377)
Prepaid expenses and current assets	(9,398)	(653)
Accounts payable and accrued expenses	10,987	10,804
CASH PROVIDED BY OPERATING ACTIVITIES:	58,676	67,909
INVESTING ACTIVITIES:
Capital expenditures	(28,853)	(22,809)
Cash paid for business, net of cash acquired	(400,697)	0
Other	531	(421)
CASH USED IN INVESTING ACTIVITIES:	(429,019)	(23,230)
FINANCING ACTIVITIES:
Repayments of long-term debt	(51,403)	(62,085)
Borrowing of long-term debt	479,837	20,000
Tax withholding payments for share-based compensation	(1,056)	(1,477)
Proceeds from issuance of common stock	207	0
Debt Issuance Costs	(8,757)	(1,418)
Dividends paid	(11,602)	(11,571)
Repurchase of common stock	(14,485)	(81,061)
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES:	392,741	(137,612)
Net cash provided by / (used) in operating, investing and financing activities	22,398	(92,933)
Effect of exchange rate changes on cash	(2,104)	5,369
CASH AND CASH EQUIVALENTS:
Net change during the period	20,294	(87,564)
Balance at beginning of period	87,037	165,672
Balance at end of period	$ 107,331	$ 78,108

XML

Note 1 - Condensed Footnotes

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

NOTE

1

– CONDENSED FOOTNOTES

As contemplated by the Securities and Exchange Commission (the “Commission”) instructions to Form

10

-Q, the following footnotes have been condensed and, therefore, do

not

contain all disclosures required in connection with annual financial statements. Reference should be made to the Company’s year-end consolidated financial statements and notes thereto contained in its Annual Report on Form

10

-K for the fiscal year ended

December 31, 2017,

as filed with the Commission.

The financial information included in this report has been prepared by the Company, without audit. In the opinion of management, the financial information included in this report contains all adjustments (all of which are normal and recurring) necessary for a fair presentation of the results for the interim periods. Nevertheless, the results shown for interim periods are

not

necessarily indicative of results to be expected for the full year. The

December 31, 2017,

consolidated condensed balance sheet data was derived from audited financial statements, but does

not

include all disclosures required by accounting principles generally accepted in the United States.

Certain prior period amounts have been reclassified to conform to the current period presentation. There was

no

change to consolidated assets, liabilities, cash flows or net income as a result of these reclassifications.

XML

Note 2 - Revenue Recognition

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Revenue from Contract with Customer [Text Block]

NOTE

2

– REVENUE RECOGNITION

Effective

January 1, 2018,

the Company adopted a new accounting standard with regard to revenue from customers. The Company elected the modified retrospective approach for adoption of this new standard, as is allowed by the standard. The Company did

not

have any significant impact from this standard as of the date of the adoption.

Revenue Recognized from Contracts with Customers

100%

of the Company’s revenue is due to contracts with its customers. These contracts typically take the form of invoices for purchase of materials from the Company. The performance obligation is the delivery of these materials to customer control. Nearly

97%

of the Company’s current revenue is produced from the sale of carpet, resilient flooring and related products (TacTiles installation materials, etc.) and the revenue from sales of these products is recognized upon shipment, or in certain cases upon delivery to the customer.  The transaction price for these sales is readily identifiable.

The remaining revenue generated by the Company is for contracts to sell and install carpet and related products at customer locations. For projects underway, the Company recognized installation revenue over time as the customer simultaneously received and consumed the benefit of the services. The installation of the carpet and related products is a separate performance obligation from the sale of carpet. The majority of these projects are completed within

5

days of the start of installation. The transaction price for these sale and installation contracts is readily determinable between flooring material and installation services and is specifically identified in the contract with the customer.

The Company has utilized the portfolio approach to its contracts with customers, as its contracts with customers have similar characteristics and it is reasonable to expect that the effects from applying this approach are

not

materially different from applying the accounting standard to individual contracts.

The Company does

not

have any other significant revenue streams outside of these sales of flooring material, and the sale and installation of flooring material, as described above.

Impairment Losses

The Company does

not

recognize any impairment losses related to its revenue contracts due primarily to the short-term and straightforward nature of these contracts.

Disaggregation of Revenue

For the

first

nine

months ended

September 30, 2018,

revenue from the Company’s customers is broken down by geography as follows:

Geography	Percentage of Net Sales
Americas		58.7%
Europe		26.2%
Asia-Pacific		15.1%

Revenue from sales of carpet, modular resilient flooring, rubber flooring, and other flooring-related material was approximately

97%

of total revenue for the

nine

months ended

September 30, 2018.

The remaining

3%

of revenue was generated from the installation of carpet and other flooring-related material.

Performance Obligations

As noted above, the Company primarily generates revenue through the sale of flooring material to end users either upon shipment or upon arrival of the product at its destination. In these instances, there typically is

no

other obligation to the customers other than the delivery of flooring material with the exception of warranty. The Company does offer a warranty to its customers which guarantees certain on-floor performance characteristics and warrants against manufacturing defects. The warranty is

not

a service warranty, and there is

no

ability to separate the warranty obligation from the sale of the carpet or purchase them separately. The Company’s incidence of warranty claims is extremely low, with approximately

0.2%

of revenue in claims on an annual basis for the last

three

fiscal years. Given the nature of the warranty as well as the financial impact, the Company has determined that there is

no

need to identify this warranty as a separate performance obligation and the Company will continue to account for warranty on an accrual basis.

For the Company’s installation business, the sales of carpet and other flooring materials and installation services are separate deliverables which under the revenue recognition requirements should be characterized as separate performance obligations. The Company historically has

not

separated these obligations and has accounted for these installation projects on a completed contract basis. The nature of the installation projects is such that the vast majority – an amount in excess of

90%

of these installation projects – are completed in less than

5

days. The Company’s largest installation customers are retail and corporate customers, and these are on a project-by-project basis and are short term installations. The impact of bifurcating the carpet sale from the installation sale is

not

considered to be material to the total Company. The Company has, however, evaluated these projects at the end of the reporting period and recorded revenue in accordance with the accounting standards for projects which were underway as of the end of the

third

quarter of

2018.

   

Costs to Obtain Contracts

The Company pays sales commissions to many of its sales personnel based upon their selling activity. These are direct costs associated with obtaining the contracts. Under the accounting standard, these costs should be expensed as the revenue is earned. As these commissions become payable upon shipment (or in certain cases delivery) of product, the commission is earned as the revenue is recognized. Due to this fact pattern, there is

no

change to the Company’s accounting for these selling commissions. There are

no

other material costs the Company incurs as part of obtaining the sales contract.

XML

Note 3 - Inventories

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Inventory Disclosure [Text Block]

NOTE

3–

INVENTORIES

Inventories are summarized as follows:

	September 30 , 201 8		December 31 , 201 7
	(In thousands)
Finished Goods	$	197,869	$	115,512
Work in Process		15,838		13,022
Raw Materials		65,108		49,401
Total Inventory	$	278,815	$	177,935

XML

Note 4 - Earnings Per Share

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Earnings Per Share [Text Block]

NOTE

4

– EARNINGS PER SHARE

The Company computes basic earnings per share (“EPS”) by dividing net income by the weighted average common shares outstanding, including participating securities outstanding, during the period as discussed below.  Diluted EPS reflects the potential dilution beyond shares for basic EPS that could occur if securities or other contracts to issue common stock were exercised, converted into common stock or resulted in the issuance of common stock that would have shared in the Company’s earnings.

The Company includes all unvested stock awards which contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid, in the number of shares outstanding in our basic and diluted EPS calculations when the inclusion of these shares would be dilutive. Unvested share-based awards of restricted stock are paid dividends equally with all other shares of common stock. As a result, the Company includes all outstanding restricted stock awards in the calculation of basic and diluted EPS. Distributed earnings include common stock dividends and dividends earned on unvested share-based payment awards. Undistributed earnings represent earnings that were available for distribution but were

not

distributed. The following tables show distributed and undistributed earnings:

	Three Months Ended				Nine Months Ended
	September 30 , 201 8		October 1 , 201 7		September 30 , 201 8		October 1 , 201 7
Earnings Per Share :
Basic Earnings Per Share:
Distributed Earnings	$	0.07	$	0.07	$	0.20	$	0.19
Undistributed Earnings		0.07		0.25		0.54		0.59
Total	$	0.14	$	0.32	$	0.74	$	0.78
Diluted Earnings Per Share:
Distributed Earnings	$	0.07	$	0.07	$	0.20	$	0.19
Undistributed Earnings		0.07		0.25		0.54		0.59
Total	$	0.14	$	0.32	$	0.74	$	0.78
Basic earnings per share	$	0.14	$	0.32	$	0.74	$	0.78
Diluted earnings per share	$	0.14	$	0.32	$	0.74	$	0.78

The following tables present net income that was attributable to participating securities:

	Three Months Ended				Nine Months Ended
	September 30 , 201 8		October 1 , 201 7		September 30 , 201 8		October 1 201 7
			( I n millions)
Net Income Attributable to Participating Securities	$	0.1	$	0.1	$	0.4	$	0.4

The weighted average shares outstanding for basic and diluted EPS were as follows:

	Three Months Ended				Nine Months Ended
	September 30 , 201 8		October 1 , 201 7		September 30 , 201 8		October 1 , 201 7
			( I n thousands)
Weighted Average Shares Outstanding		58,917		60,555		58,974		62,167
Participating Securities		579		463		579		463
Shares for Basic Earnings Per Share		59,496		61,018		59,553		62,630
Dilutive Effect of Stock Options		40		42		41		42
Shares for Diluted Earnings Per Share		59,536		61,060		59,594		62,672

For all periods presented, there were

no

options or participating securities excluded from the computation of diluted EPS.

XML

Note 5 - Long-term Debt

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Debt Disclosure [Text Block]

NOTE

5

– LONG-TERM DEBT

Syndicated Credit Facility

On

August 7, 2018,

the Company amended and restated its syndicated credit facility (the “Facility”) in connection with the nora Holding GmbH (“nora”) acquisition. The purpose of the amended and restated Facility was to fund the nora purchase price and related fees and expenses of the acquisition, and to increase the credit available to the Company and its subsidiaries following the closing of the nora acquisition in view of the larger enterprise. At

September 30, 2018,

the amended and restated Facility provided to the Company and certain of its subsidiaries a multicurrency revolving loan and U.S. denominated and multicurrency term loans. Interest on base rate loans was charged at varying rates computed by applying a margin depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter. Interest on LIBOR-based loans and fees for letters of credit were charged at varying rates computed by applying a margin over the applicable LIBOR rate, depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter. In addition, the Company paid a commitment fee per annum (depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter) on the unused portion of the Facility.

In connection with the amended and restated Facility as discussed above, the Company recorded

$8.8

million of debt issuance costs associated with the new term loans that are reflected as a reduction of long-term debt in accordance with applicable accounting standards.  As these fees are expensed over the life of the outstanding borrowing the debt balance will increase by the same amount as the fees that are expensed.

As of

September 30, 2018,

the Company had outstanding

$625.2

million of term loan borrowing and

$32.1

million of revolving loan borrowings under the Facility, and had

$3.6

million in letters of credit outstanding under the Facility. As of

September 30, 2018,

the weighted average interest rate on borrowings outstanding under the Facility was

3.70%.

Under the amended and restated Facility, the Company is required to make quarterly amortization payments of the term loan borrowings, which commence in the

fourth

quarter of

2018.

The amortization payments are due on the last day of the calendar quarter. There was

no

required quarterly amortization payment for the

third

quarter of

2018.

The Company is currently in compliance with all covenants under the Facility and anticipates that it will remain in compliance with the covenants for the foreseeable future.

Other Lines of Credit

Subsidiaries of the Company have an aggregate of the equivalent of

$9.6

million of other lines of credit available at interest rates ranging from

2.5%

to

6.5%.

As of

September 30, 2018,

there were

no

borrowings outstanding under these lines of credit. 

XML

Note 6 - Derivative Instruments

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Derivative Instruments and Hedging Activities Disclosure [Text Block]

NOTE

6

– DERIVATIVE INSTUMENTS

Interest Rate Risk Management

In the

third

quarter of

2017,

the Company entered into an interest rate swap transaction to fix the variable interest rate on a portion of its term loan borrowing in order to manage a portion of its exposure to interest rate fluctuations. The Company’s objective and strategy with respect to this interest rate swap is to protect the Company against adverse fluctuations in interest rates by reducing its exposure to variability to cash flows relating to interest payments on a portion of its outstanding debt. The Company is meeting its objective by hedging the risk of changes in its cash flows (interest payments) attributable to changes in LIBOR, the designated benchmark interest rate being hedged (the “hedged risk”), on an amount of the Company’s debt principal equal to the outstanding swap notional amount.

Cash Flow Interest Rate Swap

The Company’s interest rate swap is designated and qualifies as a cash flow hedge of forecasted interest payments. The Company reports the effective portion of the fair value gain or loss on the swap as a component of other comprehensive income (or other comprehensive loss). Gains or losses (if any) on any ineffective portion of derivative instruments in cash flow hedging relationships are recorded in the period in which they occur as a component of other expense (or other income) in the Consolidated Condensed Statement of Operations and as a component of operating activities in the Consolidated Condensed Statement of Cash Flows.  The aggregate notional amount of the swap as of

September 30, 2018

was

$100

million.

Forward Contracts

The recently acquired nora operations are party to currency forward contracts designed to hedge the cash flow risk of intercompany sales from the manufacturing facility in Europe to the Americas.  The Company’s objective and strategy with respect to these currency forward contracts is to protect the Company against adverse fluctuations in currency rates by reducing its exposure to variability in cash flows related to receipt of payment on intercompany sales.  The Company is meeting its objective by hedging the risk of changes in its cash flows (intercompany payments for inventory) attributable to changes in the U.S. dollar/Euro exchange rate (the “hedged risk”). Changes in fair value attributable to components other than exchange rates will be excluded from the assessment of effectiveness and amortized to earnings on a straight-line basis.  Changes in fair value related to the effective portion of these contracts will be reflected as a component of other comprehensive income (or other comprehensive loss). A portion of these forward contracts expire each month, with the final contract expiring in

September

of

2019.

  These contracts cover approximately

70%

of the expected intercompany sales activity between the nora European manufacturing facility and the U.S. subsidiary and at this time the Company believes these are probable transactions given historical performance as well as budget projections.  The current notional value of these forward currency contracts and the future intercompany sales these instruments hedge is approximately

$52

million.

The table below sets forth the fair value of derivative instruments as of

September 30, 2018 (

in thousands):

	Asset Derivatives as of			Liability Derivatives as of
	September 30, 2018			September 30, 2018
	Balance Sheet			Balance Sheet
	Location	Fair Value		Location	Fair Value
Derivative instruments designated as hedging instruments:
Foreign currency contracts	Other current assets	$	1,757	Other current liabilities		--
Interest rate swap contract	Other current assets		3,636	Other current liabilities		--
		$	5,393			--

The table below sets forth the fair value of derivative instruments as of

December 31, 2017 (

in thousands):

	Asset Derivatives as of			Liability Derivatives as of
	December 31, 2017			December 31, 2017
	Balance Sheet			Balance Sheet
	Location	Fair Value		Location	Fair Value
Derivative instruments designated as hedging instruments:
Interest rate swap contract	Other current assets	$	904	Other current liabilities		--

There was

no

significant impact to earnings from the changes in fair value of derivatives designated as cash flow hedges or from amounts excluded from the assessment of hedge effectiveness during the

three

and

nine

months ended

September 30, 2018. 

There was

no

significant impact from the reclassification of hedged items from accumulated other comprehensive income during the

three

and

nine

months ended

September 30, 2018.

The amount of hedged items expected to be reclassified from accumulated other comprehensive income in the next

12

months is

not

significant.

The following tables summarize the pre-tax impact that changes in the fair value of derivatives designated as cash flow hedges and included in the assessment of hedge effectiveness had on accumulated other comprehensive income during the

three

and

nine

months ended

September 30, 2018 (

in thousands):

	Gain (Loss) Recognized in Accumulated
Three months ended September 30, 2018	Other Comprehensive Income
Foreign currency contracts	$	(167	)
Interest rate swap contract	$	453

	Gain (Loss) Recognized in Accumulated
Nine months ended September 30, 2018	Other Comprehensive Income
Foreign currency contracts	$	(167	)
Interest rate swap contract	$	2,732

XML

Note 7 - Stock-based Compensation

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

NOTE

7

– STOCK-BASED COMPENSATION

Stock Option Awards

In accordance with accounting standards, the Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. That cost will be recognized over the period in which the employee is required to provide the services – the requisite service period (usually the vesting period) – in exchange for the award.

All outstanding stock options vested prior to the end of

2013,

and therefore there was

no

stock option compensation expense in the

first

nine

months of

2018

or

2017.

As of

September 30, 2018,

there were

62,500

stock options outstanding and exercisable, at an average exercise price of

$7.88

per share. There were

no

stock options granted in

2018

or

2017.

There were

20,000

stock options exercised in the

first

nine

months of

2018

and

no

forfeitures during those

nine

months. There were

no

exercises or forfeitures of stock options in the

first

nine

months of

2017.

The aggregate intrinsic value of the outstanding and exercisable stock options was

$1.0

million as of

September 30, 2018.

Restricted Stock Awards

During the

nine

months ended

September 30, 2018

and

October 1, 2017,

the Company awarded restricted stock to certain employees. Awards of restricted stock (or a portion thereof) vest with respect to each recipient over a

one

to

three

-year period from the date of grant, provided the individual remains in the employment or service of the Company as of the vesting date. Additionally, certain awards (or a portion thereof) could vest earlier in the event of a change in control of the Company, or upon involuntary termination without cause.

Compensation expense related to restricted stock grants was

$2.9

million and

$2.0

million for the

nine

months ended

September 30, 2018

and

October 1, 2017,

respectively. Accounting standards allow that the Company estimate forfeitures for restricted stock and reduce compensation expense accordingly. The Company has reduced its expense by the assumed forfeiture rate and will evaluate experience against this forfeiture rate going forward.

The following table summarizes restricted stock outstanding as of

September 30, 2018,

as well as activity during the

nine

months then ended:

	Restricted Shares		Weighted Average Grant Date Fair Value
Outstanding at December 31, 2017		463,000	$	17.79
Granted		194,000		25.57
Vested		67,000		17.56
Forfeited or canceled		11,000		18.06
Outstanding at September 30, 2018		579,000	$	25.16

As of

September 30, 2018,

the unrecognized total compensation cost related to unvested restricted stock was

$5.6

million. That cost is expected to be recognized by the end of

2021.

Performance Share Awards

During the

nine

months ended

September 30, 2018

and

October 1, 2017,

the Company issued awards of performance shares to certain employees. These awards vest based on the achievement of certain performance-based goals over a performance period of

one

to

three

years, subject to the employee’s continued employment through the last date of the performance period, and will be settled in shares of our common stock or in cash at the Company’s election. The number of shares that

may

be issued in settlement of the performance shares to the award recipients

may

be greater (up to

200%

) or lesser than the nominal award amount depending on actual performance achieved as compared to the performance targets set forth in the awards.

The following table summarizes the performance shares outstanding as of

September 30, 2018,

as well as the activity during the

nine

months then ended:

	Performance Shares		Weighted Average Grant Date Fair Value
Outstanding at December 31, 2017		669,500	$	17.51
Granted		261,000		25.69
Vested		119,000		17.78
Forfeited or canceled		20,000		18.05
Outstanding at September 30, 2018		791,500	$	20.15

Compensation expense related to performance shares was

$6.3

million and

$2.4

million for the

nine

months ended

September 30, 2018,

and

October 1, 2017,

respectively. Unrecognized compensation expense related to these performance shares was approximately

$5.9

million as of

September 30, 2018.

That cost is expected to be recognized by the end of

2021.

The tax benefits recognized with regard to restricted stock and performance shares were approximately

$1.8

million for the

nine

months ended

September 30, 2018.

XML

Note 8 - Employee Benefit Plans

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Pension and Other Postretirement Benefits Disclosure [Text Block]

NOTE

8

– EMPLOYEE BENEFIT PLANS

The following tables provide the components of net periodic benefit cost for the

three

-month and

nine

-month periods ended

September 30, 2018,

and

October 1, 2017,

respectively:

	Three Months Ended						Nine Months Ended
Defined Benefit Retirement Plan (Europe)	September 30 , 201 8			October 1 , 201 7			September 30 , 201 8			October 1 , 201 7
	(In thousands)						(In thousands)
Service cost	$	178		$	423		$	547		$	1,204
Interest cost		1,270			1,426			3,941			4,138
Expected return on assets		(1,503	)		(1,697	)		(4,667	)		(4,920	)
Amortization of prior service costs		(11	)		9			4			26
Recognized net actuarial (gains) / losses		270			318			839			930
Net periodic benefit cost	$	204		$	479		$	664		$	1,378

	Three Months Ended				Nine Months Ended
Salary Continuation Plan (SCP)	September 30 , 201 8		October 1 , 201 7		September 30 , 201 8		October 1 , 201 7
	(In thousands)				(In thousands)
Service cost	$	0	$	0	$	0	$	0
Interest cost		271		314		812		942
Amortization of prior service cost		0		0		0		0
Amortization of (gain) / loss		116		91		348		273
Net periodic benefit cost	$	387	$	405	$	1,160	$	1,215

	T h ree Months Ended		Nine Months Ended
Nora D efined B enefit P lan	September 30, 2018		September 30, 2018
	(In thousands)		( In thousands)
Service cost	$	134	$	134
Interest cost		99		99
Net periodic benefit cost	$	233	$	233

XML

Note 9 - Acquisition of Nora

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Business Combination Disclosure [Text Block]

NOTE

9

– ACQUISITION OF NORA

    On

June 14, 2018,

the Company entered into a share purchase and transfer agreement to acquire the issued and outstanding shares of nora, nora’s outstanding

third

-party debt, and receivables related to nora’s shareholder loans. Nora is the holding company for a Germany-based manufacturer and multinational marketer of resilient floor coverings, including rubber flooring. In connection with the signing of the nora share purchase and transfer agreement, the Company entered into a derivative instrument to address the foreign currency risk associated with a portion of the nora purchase price. This option instrument did

not

qualify for hedge accounting, and the mark-to-market expense of

$2.8

million to record the instrument at fair value at the end of the

second

quarter of

2018

was recorded in other expense in our consolidated condensed statement of operations during the

second

quarter. The option instrument had a notional value of

€315

million (or approximately

$364

million as of the end of the

second

quarter of

2018

) and an initial maturity of

120

days. Upon completion of the nora acquisition as discussed below, the option instrument was terminated and the Company recognized a loss of approximately

$1.4

million upon termination, which was recorded in other expense in our Consolidated Condensed Statement of Operations during the

third

quarter of

2018.

   On

August 7, 2018,

the Company completed the acquisition of nora for a purchase price of

€385.1

million, or

$447.2

million at the exchange rate as of the transaction date, including acquired cash of

€40.0

million (

$46.5

million) for a net purchase price of

€345.1

million (

$400.7

million).

Nora is an industry leader in the rubber flooring market, and this acquisition is expected to advance the Company’s growth strategy in growing market segments, particularly in the healthcare, life sciences and education market segments.  Similar to Interface, nora operates on an international footprint and the Company expects the acquisition will also allow for geographic sales synergies as well. 

 The transaction will be accounted for as a business combination using the acquisition method of accounting, which requires, among other things, that assets acquired and liabilities assumed be recorded at their fair market values as of the acquisition date. The results of operations for this acquisition have been consolidated with those of the Company from the acquisition date forward.  Tangible assets and liabilities of nora systems GmbH were valued as of the acquisition date using a market analysis, and intangible assets were valued using a discounted cash flow analysis.

       The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date. The amounts represent a provisional measurement of the fair values, and is therefore subject to change:

	As of August 7 th , 2018
	(In thousands)
Cash	$	46,495
Accounts receivables		30,996
Inventories		93,352
Other assets and prepaids		5,616
Property plant and equipment		79,538
Intangible assets		103,338
Total identifiable assets acquired		359,335
Current liabilities		(27,285	)
Deferred taxes		(29,277	)
Other long-term liabilities		(38,929	)
Total liabilities assumed		(95,491	)
Net identifiable assets acquired		263,844
Goodwill		183,348
Net assets acquired / cash paid	$	447,192

        Acquired intangibles assets of

$103.3

million include

$60.8

million of trademarks and tradenames that are

not

subject to amortization and will instead be subject to annual impairment testing, or more frequent testing should there be a significant change in business conditions. The remaining intangible assets include developed technology of

$39.1

million that will be amortized on a straight-line basis over the estimated useful life of

7

years and backlog of

$3.4

million that will be amortized on a straight-line basis over the estimated useful life of

six

months. The inventory amount above includes a step-up of inventory to fair value of approximately

$26.6

million which will be recognized in earnings over the expected turns of the inventory. This step-up of inventory to fair value will be fully amortized by the end of

2018.

       As of

September 30, 2018,

the balances, net of accumulated amortization where applicable, of the acquired intangible assets from the nora acquisition were (in thousands):

Developed technology	$	38,048
Trademarks and tradenames		59,880
Backlog		2,252
Goodwill		183,348

       As of

September 30, 2018,

the recognized goodwill of

$183.3

million and acquired intangible assets, net of amortization of

$100.2

million, were assigned pro-rata to the Company’s

three

operating segments.

None

of the goodwill is expected to be deductible for income tax purposes.

The fair value of acquired accounts receivable was

$30.1

million with the gross value being

$31.9

million. The Company expects

$1.8

million to be uncollectible.

       The Company recognized

$8.2

million of transaction costs related to the nora acquisition for the

nine

months ended

September 30, 2018.

Approximately

$4.0

million of these expenses are included in selling, general and administrative expenses in the consolidated condensed statement of operations and

$4.2

million are included in other expenses related to the derivative instrument the Company used to address the foreign currency risk associated with a portion of the nora purchase price. The Company also recognized

$8.8

million of debt issuance costs in connection with the amended and restated credit facility, which were recorded as a reduction of long-term debt in the consolidated condensed balance sheet.

     The amounts of revenue and net loss of nora included in the Company’s consolidated condensed statements of operations from the acquisition date to

September 30, 2018

are as follows (in thousands):

Revenue	$	41,159
Net loss		(12,455	)

       The following represents the pro forma consolidated condensed statement of operations as if nora had been included in the consolidated results of the Company as of

January 1, 2017.

These are estimated for pro forma purposes only and do

not

necessarily reflect the results had nora been included as of the beginning of

2018

and

2017.

	Pro Forma Consolidated Statement of Operations
	(In thousands)
	Nine months ended		Nine months ended
	September 30, 2018		October 1, 2017
Revenue	$	1,001,919	$	929,521
Net income		74,390		38,793

       Pro forma net income for the

nine

months ended

September 30, 2018,

excludes any transaction related costs as these are non-recurring costs for the combined Company.

XML

Note 10 - Segment Information

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Concentration Risk Disclosure [Text Block]

NOTE

10

– SEGMENT INFORMATION

Based on applicable accounting standards, the Company has determined that it has

three

operating segments – namely, the Americas, Europe and Asia-Pacific geographic regions. Pursuant to accounting standards, the Company has aggregated the

three

operating segments into

one

reporting segment because they have similar economic characteristics, and the operating segments are similar in all of the following areas: (a) the nature of the products and services; (b) the nature of the production processes; (c) the type or class of customer for their products and services; (d) the methods used to distribute their products or provide their services; and (e) the nature of the regulatory environment. Nora results are included in the

2018

figures as of the date of acquisition through the end of the

third

quarter of

2018,

and are included in our operating segments based on the geographic split of the operations.

While the Company operates as

one

reporting segment for the reasons discussed, included below is selected information on our operating segments.

	AMERICAS		EUROPE		ASIA- PACIFIC		TOTAL
	(in thousands)
Three Months Ended September 30, 2018:
Net Sales	$	182,660	$	88,223	$	47,442	$	318,325
Depreciation and amortization		3,373		3,181		2,144		8,698
Total assets		472,473		587,228		201,611		1,261,312
Three Months Ended October 1 , 201 7 :
Net Sales	$	148,082	$	66,677	$	42,672	$	257,431
Depreciation and amortization		3,386		1,646		2,211		7,243
Nine Months Ended September 30 , 201 8 :
Net Sales	$	494,265	$	220,645	$	127,604	$	842,514
Depreciation and amortization		10,464		7,483		6,564		24,511
Nine Months Ended October 1 , 201 7 :
Net Sales	$	433,461	$	180,506	$	116,266	$	730,233
Depreciation and amortization		10,064		4,257		6,458		20,779

A reconciliation of the Company’s total operating segment depreciation and amortization, and assets, to the corresponding consolidated amounts follows:

	Three Months Ended
DEPRECIATION AND AMORTIZATION	September 30 , 201 8		October 1 , 201 7
	(In thousands)
Total segment depreciation and amortization	$	8,698	$	7,243
Corporate depreciation and amortization, and other		1,179		539
Reported depreciation and amortization	$	9,877	$	7,782

	Nine Months Ended
DEPRECIATION AND AMORTIZATION	September 30 , 201 8		October1 , 201 7
	(In thousands)
Total segment depreciation and amortization	$	24,511	$	20,779
Corporate depreciation and amortization, and other		2,556		1,424
Reported depreciation and amortization	$	27,067	$	22,203

ASSETS	September 30 , 201 8
	(In thousands)
Total segment assets	$	1,261,312
Corporate assets and eliminations		81,648
Reported total assets	$	1,342,960

XML

Note 11 - Supplemental Cash Flow Information

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Cash Flow, Supplemental Disclosures [Text Block]

NOTE

11

– SUPPLEMENTAL CASH FLOW INFORMATION

Cash payments for interest amounted to

$7.4

million and

$4.6

million for the

nine

months ended

September 30, 2018

and

October 1, 2017,

respectively. Income tax payments amounted to

$21.2

million and

$14.8

million for the

nine

months ended

September 30, 2018

and

October 1, 2017,

respectively.

XML

Note 12 - Recently Issued Accounting Pronouncements

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

New Accounting Pronouncements and Changes in Accounting Principles [Text Block]

NOTE

12

– RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In

February 2016,

the Financial Accounting Standards Board (“FASB”) issued a new accounting standard regarding leases. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than

12

months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after

December 15, 2018,

including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact of our pending adoption of the new standard on our consolidated financial statements, but the standard will result in the Company recording both assets and liabilities for leases currently classified as operating leases.

In

January 2017,

the FASB issued a new accounting standard that provides for the elimination of Step

2

from the goodwill impairment test. Under the new guidance, impairment charges are recognized to the extent the carrying amount of a reporting unit exceeds its fair value with certain limitations. The new guidance is effective for any annual or any interim goodwill impairment tests in fiscal years beginning after

December 15, 2019.

Early adoption is permitted. The Company does

not

anticipate that the adoption of the new guidance will have a material effect on its consolidated financial statements.

In

August 2017,

the FASB issued a new accounting standard to improve the accounting for hedging activities. This standard will eliminate the requirement to separately measure and report hedge ineffectiveness and requires companies to recognize all elements of hedge accounting that impact earnings in the same line item in the statement of income where the hedged item is reported. The amendments ease the requirements for effectiveness testing and permit an entity to perform qualitative hedge effectiveness assessments. The new guidance is effective for interim and annual periods beginning after

December 15, 2018.

Early adoption is permitted. The Company has elected to early adopt this standard in the

third

quarter of

2018

and there was

no

material effect on its consolidated financial statements.

In

February 2018,

the FASB issued a new accounting standard to address a narrow-scope financial reporting issue that arose as a consequence of the U.S. Tax Cuts and Jobs Act. Existing guidance requires that deferred tax liabilities and assets be adjusted for a change in tax laws or rates with the effect included in income from continuing operations in the reporting period that includes the enactment date. That guidance is applicable even in situations in which the related income tax effects of items in accumulated other comprehensive income were originally recognized in other comprehensive income (rather than in net income), such as amounts related to benefit plans and hedging activity. As a result, the tax effects of items within accumulated other comprehensive income do

not

reflect the appropriate tax rate (the difference is referred to as stranded tax effects). The new guidance allows for a reclassification of these amounts to retained earnings, thereby eliminating these stranded tax effects. The new guidance is effective for interim and annual periods beginning after

December 15, 2018.

The Company is currently evaluating the impact of adoption of this standard on its consolidated financial statements.

In

June 2018,

the FASB issued a new accounting standard to address non-employee share-based payments. This standard will require that the accounting treatment for non-employee share-based payments for goods or services be consistent with current GAAP for employee share-based payments, including measurement of awards at grant-date fair value and the application of probability to evaluate performance conditions. This standard will also eliminate the current GAAP requirement to reassess the classification of non-employee share-based payments awards upon vesting. The new guidance is effective for interim and annual periods beginning after

December 15, 2018.

Early adoption is permitted. The Company is currently evaluating the impact of adoption of this standard, but does

not

anticipate that the adoption will have a material effect on its consolidated financial statements.

In

August 2018,

the FASB issued a new accounting standard that modifies disclosure requirements related to fair value measurements. This standard eliminates the current requirement to disclose the amount or reason for transfers between level

1

and level

2

of the fair value hierarchy and the requirement to disclose the valuation methodology for level

3

fair value measurements. The standard includes additional disclosure requirements for level

3

fair value measurements, including the requirement to disclose the changes in unrealized gains and losses in other comprehensive income during the period and permits the disclosure of other relevant quantitative information for certain unobservable inputs. The new guidance is effective for interim and annual periods beginning after

December 15, 2019.

Early adoption is permitted. The Company does

not

anticipate that the adoption of the new standard will have a material effect on its consolidated financial statements.

In

August 2018,

the FASB issued a new accounting standard that changes the disclosure requirements for defined benefit retirement plans. This standard eliminates the current requirement to disclose amounts in accumulated other comprehensive income that are expected to be recognized in net periodic benefit expense in the next fiscal year. The standard requires additional disclosures for an entity to explain the reasons for significant gains and losses related to changes in the benefit obligation for the period and clarifies current guidance for disclosures where projected benefit obligations or accumulated benefit obligations exceed the fair value of plan assets. The new guidance is effective for annual periods ending after

December 15, 2020.

Early adoption is permitted. The Company does

not

anticipate that the adoption of the new standard will have a material effect on its consolidated financial statements.

In

August 2018,

the FASB issued a new accounting standard to align the requirements for capitalizing implementation costs incurred in a hosting arrangement service contract with the guidance to capitalize implementation costs of internal use software. This standard requires that the costs for implementation activities during the application development phase be capitalized in a hosting arrangement service contract, and costs during the preliminary and post implementation phase are expensed. The new guidance is effective for interim and annual periods beginning after

December 15, 2019.

Early adoption is permitted. The Company is currently evaluating the impact of adoption of this standard, but does

not

anticipate that the adoption will have a material effect on its consolidated financial statements.

XML

Note 13 - Income Taxes

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Income Tax Disclosure [Text Block]

NOTE

13–

INCOMETAXES

On

December 22, 2017,

the U.S. Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Company is continuing to evaluate the Tax Act and its requirements, as well as its application to our business and its impact on our effective tax rate.

The Company is applying the guidance to address the accounting for income taxes under accounting standards in situations when a registrant does

not

have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Act.  Accounting standards provide a reasonable “measurement period”

not

to exceed

twelve

months from the date of enactment to complete the accounting of these provisional estimates.  As disclosed in the Company’s Annual report on Form

10

-K for the fiscal year ended

December 31, 2017, 

two

material provisional estimates that impacted the Company were the U.S. statutory rate reduction and the

one

-time transition tax. These amounts were considered provisional because they used reasonable estimates for taxes with respect to which tax returns had

not

been filed and because estimated amounts

may

be impacted by future regulatory and accounting guidance if and when issued. 

For the

nine

months ended

September 30, 2018,

there were

no

significant changes to the Company’s provisional estimates of the income tax effects reflected in

2017

for the changes in tax law and tax rate from the enactment of the Tax Act. The impact of tax law changes on the Company’s financial statements could differ from its reasonable estimates due to further analysis of the new law, regulatory guidance, technical corrections, legislation, or guidance under U.S. generally accepted accounting principles. If significant changes occur, the Company will provide updated information in connection with future regulatory filings or the Company will adjust these provisional amounts as further information becomes available and as we refine our calculations.

During the

nine

months ended

September 30, 2018,

the Company’s effective tax rate was favorably impacted by the reduction in the U.S. statutory tax rate due to the enactment of the Tax Act. This favorable impact was partially offset by certain base broadening provisions of the Tax Act. For the

nine

months ended

September 30, 2018,

our effective tax rate was

24%,

as compared to

32%

for the

first

nine

month of

2017.

Accounting standards require that all tax positions be analyzed using a

two

-step approach. The

first

step requires an entity to determine if a tax position is more-likely-than-

not

to be sustained upon examination. In the

second

step, the tax benefit is measured as the largest amount of benefit, determined on a cumulative probability basis, that is more-likely-than-

not

to be realized upon ultimate settlement. In the

first

nine

months of

2018,

the Company decreased its liability for unrecognized tax benefits by

$1.0

million. As of

September 30, 2018,

the Company had accrued approximately

$28.2

million for unrecognized tax benefits. In accordance with applicable accounting standards, the Company’s deferred tax asset as of

September 30, 2018

reflects a reduction for

$3.3

million of these unrecognized tax benefits.

XML

Note 14 - Items Reclassified From Other Comprehensive Income

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Reclassifications [Text Block]

NOTE

14

– ITEMS RECLASSIFIED FROM OTHER COMPREHENSIVE INCOME

During the

first

nine

months of

2018,

the Company did

not

reclassify any significant amounts out of accumulated other comprehensive income. The reclassifications that occurred in that period were primarily comprised of

$1.2

million related to the Company’s defined benefit retirement plan and salary continuation plan. These reclassifications were included in the other expense line item of the Company’s consolidated condensed statement of operations.

XML

Note 15 - Repurchase of Common Stock

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

NOTE

15–

REPURCHASE OF COMMON STOCK

In

2017,

the Company adopted a new share repurchase program in which the Company is authorized to repurchase up to

$100

million of its outstanding shares of common stock. The program has

no

specific expiration date.

During the

first

nine

months of

2018,

the Company repurchased and retired

615,000

shares of common stock at a weighted average price of

$23.54

per share pursuant to this share repurchase program.

XML

Note 2 - Revenue Recognition (Tables)

9 Months Ended

Sep. 30, 2018

Notes Tables

Disaggregation of Revenue [Table Text Block]

Geography	Percentage of Net Sales
Americas		58.7%
Europe		26.2%
Asia-Pacific		15.1%

XML

Note 3 - Inventories (Tables)

9 Months Ended

Sep. 30, 2018

Notes Tables

Schedule of Inventory, Current [Table Text Block]

	September 30 , 201 8		December 31 , 201 7
	(In thousands)
Finished Goods	$	197,869	$	115,512
Work in Process		15,838		13,022
Raw Materials		65,108		49,401
Total Inventory	$	278,815	$	177,935

XML

Note 4 - Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2018

Notes Tables

Distributed And Undistributed Earnings [Table Text Block]

	Three Months Ended				Nine Months Ended
	September 30 , 201 8		October 1 , 201 7		September 30 , 201 8		October 1 , 201 7
Earnings Per Share :
Basic Earnings Per Share:
Distributed Earnings	$	0.07	$	0.07	$	0.20	$	0.19
Undistributed Earnings		0.07		0.25		0.54		0.59
Total	$	0.14	$	0.32	$	0.74	$	0.78
Diluted Earnings Per Share:
Distributed Earnings	$	0.07	$	0.07	$	0.20	$	0.19
Undistributed Earnings		0.07		0.25		0.54		0.59
Total	$	0.14	$	0.32	$	0.74	$	0.78
Basic earnings per share	$	0.14	$	0.32	$	0.74	$	0.78
Diluted earnings per share	$	0.14	$	0.32	$	0.74	$	0.78

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	Three Months Ended				Nine Months Ended
	September 30 , 201 8		October 1 , 201 7		September 30 , 201 8		October 1 201 7
			( I n millions)
Net Income Attributable to Participating Securities	$	0.1	$	0.1	$	0.4	$	0.4

	Three Months Ended				Nine Months Ended
	September 30 , 201 8		October 1 , 201 7		September 30 , 201 8		October 1 , 201 7
			( I n thousands)
Weighted Average Shares Outstanding		58,917		60,555		58,974		62,167
Participating Securities		579		463		579		463
Shares for Basic Earnings Per Share		59,496		61,018		59,553		62,630
Dilutive Effect of Stock Options		40		42		41		42
Shares for Diluted Earnings Per Share		59,536		61,060		59,594		62,672

XML

Note 6 - Derivative Instruments (Tables)

9 Months Ended

Sep. 30, 2018

Notes Tables

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block]

	Asset Derivatives as of			Liability Derivatives as of
	September 30, 2018			September 30, 2018
	Balance Sheet			Balance Sheet
	Location	Fair Value		Location	Fair Value
Derivative instruments designated as hedging instruments:
Foreign currency contracts	Other current assets	$	1,757	Other current liabilities		--
Interest rate swap contract	Other current assets		3,636	Other current liabilities		--
		$	5,393			--

	Asset Derivatives as of			Liability Derivatives as of
	December 31, 2017			December 31, 2017
	Balance Sheet			Balance Sheet
	Location	Fair Value		Location	Fair Value
Derivative instruments designated as hedging instruments:
Interest rate swap contract	Other current assets	$	904	Other current liabilities		--

Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) [Table Text Block]

	Gain (Loss) Recognized in Accumulated
Three months ended September 30, 2018	Other Comprehensive Income
Foreign currency contracts	$	(167	)
Interest rate swap contract	$	453

	Gain (Loss) Recognized in Accumulated
Nine months ended September 30, 2018	Other Comprehensive Income
Foreign currency contracts	$	(167	)
Interest rate swap contract	$	2,732

XML

Note 7 - Stock-based Compensation (Tables)

9 Months Ended

Sep. 30, 2018

Notes Tables

Schedule of Share-based Compensation, Restricted Stock Units Award Activity [Table Text Block]

	Restricted Shares		Weighted Average Grant Date Fair Value
Outstanding at December 31, 2017		463,000	$	17.79
Granted		194,000		25.57
Vested		67,000		17.56
Forfeited or canceled		11,000		18.06
Outstanding at September 30, 2018		579,000	$	25.16

Schedule of Nonvested Performance-based Units Activity [Table Text Block]

	Performance Shares		Weighted Average Grant Date Fair Value
Outstanding at December 31, 2017		669,500	$	17.51
Granted		261,000		25.69
Vested		119,000		17.78
Forfeited or canceled		20,000		18.05
Outstanding at September 30, 2018		791,500	$	20.15

XML

Note 8 - Employee Benefit Plans (Tables)

9 Months Ended

Sep. 30, 2018

Notes Tables

Schedule of Net Benefit Costs [Table Text Block]

	Three Months Ended						Nine Months Ended
Defined Benefit Retirement Plan (Europe)	September 30 , 201 8			October 1 , 201 7			September 30 , 201 8			October 1 , 201 7
	(In thousands)						(In thousands)
Service cost	$	178		$	423		$	547		$	1,204
Interest cost		1,270			1,426			3,941			4,138
Expected return on assets		(1,503	)		(1,697	)		(4,667	)		(4,920	)
Amortization of prior service costs		(11	)		9			4			26
Recognized net actuarial (gains) / losses		270			318			839			930
Net periodic benefit cost	$	204		$	479		$	664		$	1,378

	Three Months Ended				Nine Months Ended
Salary Continuation Plan (SCP)	September 30 , 201 8		October 1 , 201 7		September 30 , 201 8		October 1 , 201 7
	(In thousands)				(In thousands)
Service cost	$	0	$	0	$	0	$	0
Interest cost		271		314		812		942
Amortization of prior service cost		0		0		0		0
Amortization of (gain) / loss		116		91		348		273
Net periodic benefit cost	$	387	$	405	$	1,160	$	1,215

	T h ree Months Ended		Nine Months Ended
Nora D efined B enefit P lan	September 30, 2018		September 30, 2018
	(In thousands)		( In thousands)
Service cost	$	134	$	134
Interest cost		99		99
Net periodic benefit cost	$	233	$	233

XML

Note 9 - Acquisition of Nora (Tables)

9 Months Ended

Sep. 30, 2018

Notes Tables

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

	As of August 7 th , 2018
	(In thousands)
Cash	$	46,495
Accounts receivables		30,996
Inventories		93,352
Other assets and prepaids		5,616
Property plant and equipment		79,538
Intangible assets		103,338
Total identifiable assets acquired		359,335
Current liabilities		(27,285	)
Deferred taxes		(29,277	)
Other long-term liabilities		(38,929	)
Total liabilities assumed		(95,491	)
Net identifiable assets acquired		263,844
Goodwill		183,348
Net assets acquired / cash paid	$	447,192

Schedule of Acquired Finite-Lived Intangible Assets by Major Class [Table Text Block]

Developed technology	$	38,048
Trademarks and tradenames		59,880
Backlog		2,252
Goodwill		183,348

Business Acquisition, Actual Revenue and Net Loss Included in Operations [Table Text Block]

Revenue	$	41,159
Net loss		(12,455	)

Business Acquisition, Pro Forma Information [Table Text Block]

	Pro Forma Consolidated Statement of Operations
	(In thousands)
	Nine months ended		Nine months ended
	September 30, 2018		October 1, 2017
Revenue	$	1,001,919	$	929,521
Net income		74,390		38,793

XML

Note 10 - Segment Information (Tables)

9 Months Ended

Sep. 30, 2018

Notes Tables

Schedule of Segment Reporting Information, by Segment [Table Text Block]

	AMERICAS		EUROPE		ASIA- PACIFIC		TOTAL
	(in thousands)
Three Months Ended September 30, 2018:
Net Sales	$	182,660	$	88,223	$	47,442	$	318,325
Depreciation and amortization		3,373		3,181		2,144		8,698
Total assets		472,473		587,228		201,611		1,261,312
Three Months Ended October 1 , 201 7 :
Net Sales	$	148,082	$	66,677	$	42,672	$	257,431
Depreciation and amortization		3,386		1,646		2,211		7,243
Nine Months Ended September 30 , 201 8 :
Net Sales	$	494,265	$	220,645	$	127,604	$	842,514
Depreciation and amortization		10,464		7,483		6,564		24,511
Nine Months Ended October 1 , 201 7 :
Net Sales	$	433,461	$	180,506	$	116,266	$	730,233
Depreciation and amortization		10,064		4,257		6,458		20,779

Reconciliation of Depreciation, Amortization, and Assets from Segments to Consolidated [Table Text Block]

	Three Months Ended
DEPRECIATION AND AMORTIZATION	September 30 , 201 8		October 1 , 201 7
	(In thousands)
Total segment depreciation and amortization	$	8,698	$	7,243
Corporate depreciation and amortization, and other		1,179		539
Reported depreciation and amortization	$	9,877	$	7,782

	Nine Months Ended
DEPRECIATION AND AMORTIZATION	September 30 , 201 8		October1 , 201 7
	(In thousands)
Total segment depreciation and amortization	$	24,511	$	20,779
Corporate depreciation and amortization, and other		2,556		1,424
Reported depreciation and amortization	$	27,067	$	22,203

Reconciliation of Assets from Segment to Consolidated [Table Text Block]

ASSETS	September 30 , 201 8
	(In thousands)
Total segment assets	$	1,261,312
Corporate assets and eliminations		81,648
Reported total assets	$	1,342,960

XML

Note 2 - Revenue Recognition (Details Textual)	9 Months Ended
	Sep. 30, 2018
Percent of Revenue Due to Contracts With Customers	100.00%
Percent of Warranty Claims to Revenue	0.20%
Carpet, Modular Resilient Flooring, and Related Products [Member]
Percent of Revenue Due to Contracts With Customers	97.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	5 days
Percent of Revenue Due to Sales To Customers	97.00%
Installation of Carpet and Other Flooring Related Material [Member]
Percent of Revenue Due to Sales To Customers	3.00%

XML

Note 2 - Revenue Recognition - Disaggregation of Revenue (Details)	9 Months Ended
	Sep. 30, 2018
Americas [Member]
Percentage of net sales	58.70%
Europe [Member]
Percentage of net sales	26.20%
Asia Pacific [Member]
Percentage of net sales	15.10%

XML

Note 3 - Inventories - Summary of Inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Finished Goods	$ 197,869	$ 115,512
Work in Process	15,838	13,022
Raw Materials	65,108	49,401
Total Inventory	$ 278,815	$ 177,935

XML

Note 4 - Earnings Per Share (Details Textual) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Oct. 01, 2017	Sep. 30, 2018	Oct. 01, 2017
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	0	0	0	0

XML

Note 4 - Earnings Per Share - Distributed and Undistributed Earnings (Details) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Oct. 01, 2017	Sep. 30, 2018	Oct. 01, 2017
Basic Earnings Per Share:
Distributed Earnings (in dollars per share)	$ 0.07	$ 0.07	$ 0.20	$ 0.19
Undistributed Earnings (in dollars per share)	0.07	0.25	0.54	0.59
Total (in dollars per share)	0.14	0.32	0.74	0.78
Diluted Earnings Per Share:
Distributed Earnings (in dollars per share)	0.07	0.07	0.20	0.19
Undistributed Earnings (in dollars per share)	0.07	0.25	0.54	0.59
Total (in dollars per share)	0.14	0.32	0.74	0.78
Basic earnings per share (in dollars per share)	0.14	0.32	0.74	0.78
Diluted earnings per share (in dollars per share)	$ 0.14	$ 0.32	$ 0.74	$ 0.78

XML

Note 4 - Earnings Per Share - Calculation of Income (Loss) Per Shares (Details) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended				9 Months Ended
	Sep. 30, 2018	Sep. 30, 2018	Oct. 01, 2017	Sep. 30, 2017	Sep. 30, 2018	Oct. 01, 2017	Sep. 30, 2017
Net Income	$ 8,172	$ 8,172	$ 19,439	$ 19,439	$ 43,858	$ 48,924	$ 48,924
Shares for Basic Earnings Per Share (in shares)	59,496		61,018		59,553	62,630
Dilutive Effect of Stock Options (in shares)	40		42		41	42
Shares for Diluted Earnings Per Share (in shares)	59,536		61,060		59,594	62,672
Participating Securities [Member]
Net Income	$ 100		$ 100		$ 400	$ 400
Weighted Average Shares Outstanding (in shares)	58,917		60,555		58,974	62,167
Participating Securities (in shares)	579		463		579	463

XML

Note 5 - Long-term Debt (Details Textual) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Payments of Debt Issuance Costs	$ 8,757	$ 1,418
Other Line Of Credit [Member]
Long-term Line of Credit, Total	0
Line of Credit Facility, Maximum Borrowing Capacity	$ 9,600
Other Line Of Credit [Member] | Minimum [Member]
Line of Credit Facility, Interest Rate During Period	2.50%
Other Line Of Credit [Member] | Maximum [Member]
Line of Credit Facility, Interest Rate During Period	6.50%
Syndicated Facility Agreement [Member]
Letters of Credit Outstanding, Amount	$ 3,600
Long-term Debt, Weighted Average Interest Rate, at Point in Time	3.70%
Syndicated Facility Agreement [Member] | Revolving Credit Facility [Member]
Long-term Line of Credit, Total	$ 32,100
Syndicated Facility Agreement [Member] | Term Loan [Member]
Payments of Debt Issuance Costs	8,800
Long-term Debt, Total	$ 625,200

XML

Note 6 - Derivative Instruments (Details Textual) $ in Millions	Sep. 30, 2018 USD ($)
Interest Rate Swap [Member]
Derivative, Notional Amount	$ 100
Foreign Exchange Forward [Member]
Derivative, Notional Amount	$ 52
Derivative, Percentage of Expected Inter-company Sales Between European and US Subsidiary	70.00%

XML

Note 6 - Derivative Instruments - Fair Value of Derivative Instruments (Details) - Designated as Hedging Instrument [Member] - Cash Flow Hedging [Member] - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Derivative Asset, Fair Value	$ 5,393
Derivative Liability, Fair Value
Foreign Exchange Forward [Member] | Other Current Assets [Member]
Derivative Asset, Fair Value	1,757
Foreign Exchange Forward [Member] | Other Current Liabilities [Member]
Derivative Liability, Fair Value
Interest Rate Swap [Member] | Other Current Assets [Member]
Derivative Asset, Fair Value	3,636	$ 904
Interest Rate Swap [Member] | Other Current Liabilities [Member]
Derivative Liability, Fair Value

XML

Note 6 - Derivative Instruments - Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) (Details) - Cash Flow Hedging [Member] - Designated as Hedging Instrument [Member] - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2018
Foreign Exchange Forward [Member]
Derivative, Pre-tax gain (loss) recognized in OCI	$ (167)	$ (167)
Interest Rate Swap [Member]
Derivative, Pre-tax gain (loss) recognized in OCI	$ 453	$ 2,732

XML

Note 7 - Stock-based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2018	Oct. 01, 2017
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance	62,500
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Ending Balance	$ 7.88
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross	0	0
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period	20,000	0
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Total	0
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Intrinsic Value	$ 1,000
Employee Stock Option [Member]
Allocated Share-based Compensation Expense, Total	0	$ 0
Restricted Stock [Member]
Allocated Share-based Compensation Expense, Total	2,900	2,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options	$ 5,600
Restricted Stock [Member] | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	1 year
Restricted Stock [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	3 years
Performance Shares [Member]
Allocated Share-based Compensation Expense, Total	$ 6,300	$ 2,400
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options	$ 5,900
Share-Based Compensation Arrangement By Share-Based Payment Award, Equity Instruments Other Than Options, Shares Issued During Exercise of Instrument, Upper Limit, Percentage	200.00%
Performance Shares [Member] | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	1 year
Performance Shares [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	3 years
Restricted and Performance Shares [Member]
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense	$ 1,800

XML

Note 7 - Stock-based Compensation - Restricted Stock Outstanding (Details) - Restricted Stock [Member]	9 Months Ended
	Sep. 30, 2018 $ / shares shares
Outstanding at December 31, 2017 (in shares) | shares	463,000
Outstanding at December 31, 2017 (in dollars per share) | $ / shares	$ 17.79
Granted (in shares) | shares	194,000
Granted (in dollars per share) | $ / shares	$ 25.57
Vested (in shares) | shares	67,000
Vested (in dollars per share) | $ / shares	$ 17.56
Forfeited or canceled (in shares) | shares	11,000
Forfeited or canceled (in dollars per share) | $ / shares	$ 18.06
Outstanding at September 30, 2018 (in shares) | shares	579,000
Outstanding at September 30, 2018 (in dollars per share) | $ / shares	$ 25.16

XML

Note 7 - Stock-based Compensation - Performance Shares Outstanding (Details) - Performance Shares [Member]	9 Months Ended
	Sep. 30, 2018 $ / shares shares
Outstanding at December 31, 2017 (in shares) | shares	669,500
Outstanding at December 31, 2017 (in dollars per share) | $ / shares	$ 17.51
Granted (in shares) | shares	261,000
Granted (in dollars per share) | $ / shares	$ 25.69
Vested (in shares) | shares	119,000
Vested (in dollars per share) | $ / shares	$ 17.78
Forfeited or canceled (in shares) | shares	20,000
Forfeited or canceled (in dollars per share) | $ / shares	$ 18.05
Outstanding at September 30, 2018 (in shares) | shares	791,500
Outstanding at September 30, 2018 (in dollars per share) | $ / shares	$ 20.15

XML

Note 8 - Employee Benefit Plans - Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Oct. 01, 2017	Sep. 30, 2018	Oct. 01, 2017
Nora Defined Benefit Plan [Member]
Service cost	$ 134		$ 134
Interest cost	99		99
Net periodic benefit cost	233		233
Service cost	134		134
Interest cost	99		99
Foreign Plan [Member]
Service cost	178	$ 423	547	$ 1,204
Interest cost	1,270	1,426	3,941	4,138
Expected return on assets	(1,503)	(1,697)	(4,667)	(4,920)
Amortization of prior service costs	(11)	9	4	26
Recognized net actuarial (gains) / losses	270	318	839	930
Net periodic benefit cost	204	479	664	1,378
Service cost	178	423	547	1,204
Interest cost	1,270	1,426	3,941	4,138
UNITED STATES | Salary Continuation Plan [Member]
Service cost	0	0	0	0
Interest cost	271	314	812	942
Amortization of prior service costs	0	0	0	0
Net periodic benefit cost	387	405	1,160	1,215
Amortization of (gain) / loss	116	91	348	273
Service cost	0	0	0	0
Interest cost	$ 271	$ 314	$ 812	$ 942

XML

Note 9 - Acquisition of Nora (Details Textual) $ in Thousands, € in Millions			3 Months Ended	9 Months Ended
	Aug. 07, 2018 USD ($)	Aug. 07, 2018 EUR (€)	Sep. 30, 2018 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2017 USD ($)	Sep. 30, 2018 EUR (€)
Payments to Acquire Businesses, Net of Cash Acquired, Total				$ 400,697	$ 0
Number of Operating Segments				3
Payments of Debt Issuance Costs				$ 8,757	$ 1,418
Syndicated Facility Agreement [Member] | Term Loan [Member]
Payments of Debt Issuance Costs				8,800
Nora [Member]
Business Combination, Consideration Transferred, Total	$ 447,200	€ 385.1
Cash Acquired from Acquisition	46,500	40.0
Payments to Acquire Businesses, Net of Cash Acquired, Total	400,700	€ 345.1
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill, Total	103,338
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Step-up of Inventory	26,600
Goodwill, Ending Balance	183,348		$ 183,348	183,348
Finite-Lived Intangible Assets, Net, Ending Balance			100,200	100,200
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables	30,996
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Gross Receivables	31,900
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables Uncollectible	1,800
Business Combination, Acquisition Related Costs				8,200
Nora [Member] | Developed Technology Rights [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill, Total	$ 39,100
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life	7 years	7 years
Finite-Lived Intangible Assets, Net, Ending Balance			38,048	38,048
Nora [Member] | Order or Production Backlog [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill, Total	$ 3,400
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life	180 days	180 days
Finite-Lived Intangible Assets, Net, Ending Balance			2,252	2,252
Nora [Member] | Trademarks and Trade Names [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill, Total	$ 60,800
Nora [Member] | Other Expense [Member]
Loss Recognized Upon Termination of Option Instrument			1,400
Business Combination, Acquisition Related Costs				4,200
Nora [Member] | Selling, General and Administrative Expenses [Member]
Business Combination, Acquisition Related Costs				4,000
Nora [Member] | Foreign Exchange Option [Member]
Derivative, Notional Amount			$ 364,000	$ 364,000		€ 315.0
Derivative, Term of Contract			120 days
Nora [Member] | Foreign Exchange Option [Member] | Other Expense [Member]
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net, Total			$ 2,800

XML

Note 9 - Acquisition of Nora - Schedule of Assets Acquired and Liabilities Assumed (Details) - Nora [Member] - USD ($) $ in Thousands	Sep. 30, 2018	Aug. 07, 2018
Cash		$ 46,495
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables		30,996
Inventories		93,352
Other assets and prepaids		5,616
Property plant and equipment		79,538
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill, Total		103,338
Total identifiable assets acquired		359,335
Current liabilities		(27,285)
Deferred taxes		(29,277)
Other long-term liabilities		(38,929)
Total liabilities assumed		(95,491)
Net identifiable assets acquired		263,844
Goodwill, Ending Balance	$ 183,348	183,348
Net assets acquired / cash paid		$ 447,192

XML

Note 9 - Acquisition of Nora - Acquired Intangible Assets (Details) - Nora [Member] - USD ($) $ in Thousands	Sep. 30, 2018	Aug. 07, 2018
Finite lived intangible assets	$ 100,200
Goodwill	183,348	$ 183,348
Developed Technology Rights [Member]
Finite lived intangible assets	38,048
Trademarks and Trade Names [Member]
Finite lived intangible assets	59,880
Order or Production Backlog [Member]
Finite lived intangible assets	$ 2,252

XML

Note 9 - Acquisition of Nora - Revenue and Net Loss Included in Operations (Details) - Nora [Member] $ in Thousands	2 Months Ended
	Sep. 30, 2018 USD ($)
Revenue	$ 41,159
Net loss	$ (12,455)

XML

Note 9 - Acquisition of Nora - Pro Forma Information (Details) - Nora [Member] - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Oct. 01, 2017
Revenue	$ 1,001,919	$ 929,521
Net income	$ 74,390	$ 38,793

XML

Note 10 - Segment Information (Details Textual)	9 Months Ended
	Sep. 30, 2018
Number of Operating Segments	3
Number of Reportable Segments	1

XML

Note 10 - Segment Information - Operating Segments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Oct. 01, 2017	Sep. 30, 2018	Oct. 01, 2017	Sep. 30, 2017	Dec. 31, 2017
NET SALES	$ 318,325	$ 257,431	$ 842,514	$ 730,233
Depreciation and amortization	9,877	7,782	27,067	22,203	$ 22,203
Assets	1,342,960		1,342,960			$ 800,600
Operating Segments [Member]
NET SALES	318,325	257,431	842,514	730,233
Depreciation and amortization	8,698	7,243	24,511	20,779
Assets	1,261,312		1,261,312
Americas [Member] | Operating Segments [Member]
NET SALES	182,660	148,082	494,265	433,461
Depreciation and amortization	3,373	3,386	10,464	10,064
Assets	472,473		472,473
Europe [Member] | Operating Segments [Member]
NET SALES	88,223	66,677	220,645	180,506
Depreciation and amortization	3,181	1,646	7,483	4,257
Assets	587,228		587,228
Asia Pacific [Member] | Operating Segments [Member]
NET SALES	47,442	42,672	127,604	116,266
Depreciation and amortization	2,144	$ 2,211	6,564	$ 6,458
Assets	$ 201,611		$ 201,611

XML

Note 10 - Segment Information - Operating Segments Depreciation, Amortization, and Assets (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Oct. 01, 2017	Sep. 30, 2018	Oct. 01, 2017	Sep. 30, 2017
Depreciation and amortization	$ 9,877	$ 7,782	$ 27,067	$ 22,203	$ 22,203
Operating Segments [Member]
Depreciation and amortization	8,698	7,243	24,511	20,779
Corporate, Non-Segment [Member]
Depreciation and amortization	$ 1,179	$ 539	$ 2,556	$ 1,424

XML

Note 10 - Segment Information - Reconciliation of Segment Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Assets	$ 1,342,960	$ 800,600
Operating Segments [Member]
Assets	1,261,312
Corporate, Non-Segment [Member]
Assets	$ 81,648

XML

Note 11 - Supplemental Cash Flow Information (Details Textual) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2018	Oct. 01, 2017
Interest Paid, Excluding Capitalized Interest, Operating Activities	$ 7.4	$ 4.6
Income Taxes Paid	$ 21.2	$ 14.8

XML

Note 13 - Income Taxes (Details Textual) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2018	Oct. 01, 2017
Effective Income Tax Rate Reconciliation, Percent, Total	24.00%	32.00%
Unrecognized Tax Benefits, Period Increase (Decrease), Total	$ (1.0)
Unrecognized Tax Benefits, Ending Balance	28.2
Increase (Decrease) in Deferred Tax Assets	$ (3.3)

XML

Note 14 - Items Reclassified From Other Comprehensive Income (Details Textual) $ in Millions	9 Months Ended
	Sep. 30, 2018 USD ($)
Other Expense [Member]
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, after Tax, Total	$ 1.2

XML

Note 15 - Repurchase of Common Stock (Details Textual) - Common Stock [Member] - USD ($) $ / shares in Units, $ in Billions	9 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Stock Repurchase Program, Authorized Amount		$ 0.1
Stock Repurchased and Retired During Period, Shares	615,000
Treasury Stock Acquired, Average Cost Per Share	$ 23.54