Joint Venture

9 Months Ended

Jun. 30, 2021

Equity Method Investments And Joint Ventures [Abstract]

Joint Venture

Note 6.  Joint venture

In fiscal year 2016, Woodward and General Electric Company (“GE”), acting through its GE Aviation business unit, consummated the formation of a strategic joint venture between Woodward and GE (the “JV”) to develop, manufacture and support fuel systems for specified existing and all future GE commercial aircraft engines that produce thrust in excess of fifty thousand pounds.

Unamortized deferred revenue from material rights in connection with the JV formation included:

	June 30, 2021		September 30, 2020
Accrued liabilities	$	4,595	$	4,066
Other liabilities		235,463		234,240

Amortization of the deferred revenue (material right) recognized as an increase to sales was $971 for the three-months and $3,142 for the nine-months ended June 30, 2021, and $802 for the three-months and $4,331 for the nine-months ended June 30, 2020.  

As part of the JV formation, GE pays contingent consideration to Woodward consisting of fifteen annual payments of $4,894 per year, which began in the second quarter of fiscal year 2017, subject to certain claw-back conditions.  Woodward received its annual payments of $4,894 during the three-months ended March 31, 2021 and 2020, which were recorded as deferred income and included in “Net cash provided by operating activities” on the Condensed Consolidated Statements of Cash Flows.

Other income related to Woodward’s equity interest in the earnings of the JV was as follows:

	Three-Months Ended June 30,			Nine-Months Ended June 30,
	2021	2020		2021	2020
Other income	2,688	$	931	8,853	$	8,824

Cash distributions to Woodward from the JV, recognized in “Net cash provided by operating activities” on the Condensed Consolidated Statements of Cash Flows, were as follows:

	Three-Months Ended June 30,			Nine-Months Ended June 30,
	2021	2020		2021	2020
Cash distributions	3,000	$	4,000	10,000	$	7,000

Net sales to the JV were as follows:  

	Three-Months Ended June 30,			Nine-Months Ended June 30,
	2021	2020		2021	2020
Net sales1	8,441	$	7,026	26,825	$	38,511

(1) Net sales included a reduction of $3,944 for the three-months and $14,998 for the nine-months ended June 30, 2021 related to royalties owed to the JV by Woodward on sales by Woodward directly to third party aftermarket customers, compared to a reduction to sales of $2,292 for the three-months and $19,305 for the nine-months ended June 30, 2020.

The Condensed Consolidated Balance Sheets include “Accounts receivable” related to amounts the JV owed Woodward, “Accounts payable” related to amounts Woodward owed the JV, and “Other assets” related to Woodward’s net investment in the JV, as follows:

	June 30, 2021	September 30, 2020
Accounts receivable	3,235	$	3,062
Accounts payable	1,692		1,502
Other assets	7,975		9,123