[X] | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
[ ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Ohio | 95-2680965 |
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
One Invacare Way, P.O. Box 4028, Elyria, Ohio | 44036 |
(Address of principal executive offices) | (Zip Code) |
Item | Page | |
PART I: FINANCIAL INFORMATION | ||
1 | ||
2 | ||
3 | ||
4 | ||
PART II: OTHER INFORMATION | ||
1 | ||
1A. | ||
2 | ||
6 | ||
For the Three Months Ended | ||||||||
March 31, | ||||||||
2012 | 2011 | |||||||
(In thousands, except per share data) | ||||||||
Net sales | $ | 433,564 | $ | 428,498 | ||||
Cost of products sold | 313,995 | 305,492 | ||||||
Gross Profit | 119,569 | 123,006 | ||||||
Selling, general and administrative expenses | 107,499 | 105,777 | ||||||
Charges related to restructuring activities | 548 | — | ||||||
Loss on debt extinguishment including debt finance charges and associated fees | — | 4,881 | ||||||
Interest expense | 1,476 | 2,611 | ||||||
Interest income | (337 | ) | (267 | ) | ||||
Earnings before Income Taxes | 10,383 | 10,004 | ||||||
Income taxes | 2,150 | 2,550 | ||||||
Net Earnings | $ | 8,233 | $ | 7,454 | ||||
Net Earnings per Share—Basic | $ | 0.26 | $ | 0.23 | ||||
Weighted Average Shares Outstanding—Basic | 31,819 | 32,174 | ||||||
Net Earnings per Share—Assuming Dilution | $ | 0.26 | $ | 0.23 | ||||
Weighted Average Shares Outstanding—Assuming Dilution | 31,822 | 33,015 | ||||||
Net Earnings | $ | 8,233 | $ | 7,454 | ||||
Other comprehensive income: | ||||||||
Foreign currency translation adjustments | 334 | 35,433 | ||||||
Defined Benefit Plans: | ||||||||
Amortization of prior service costs and unrecognized gains (losses) | 228 | (25 | ) | |||||
Amounts arising during the year, primarily due to the addition of new participants | (35 | ) | (204 | ) | ||||
Deferred tax adjustment resulting from defined benefit plan activity | (11 | ) | 35 | |||||
Valuation reserve (reversal) associated with defined benefit plan activity | 11 | (17 | ) | |||||
Current period unrealized gain (loss) on cash flow hedges | 793 | (1,315 | ) | |||||
Deferred tax benefit (loss) related to unrealized gain (loss) on cash flow hedges | (134 | ) | 31 | |||||
Other Comprehensive Income | 1,186 | 33,938 | ||||||
Comprehensive Income | $ | 9,419 | $ | 41,392 |
March 31, 2012 | December 31, 2011 | ||||||
(In thousands) | |||||||
Assets | |||||||
Current Assets | |||||||
Cash and cash equivalents | $ | 32,668 | $ | 34,924 | |||
Trade receivables, net | 255,359 | 247,974 | |||||
Installment receivables, net | 4,542 | 6,671 | |||||
Inventories, net | 214,155 | 192,761 | |||||
Deferred income taxes | 1,038 | 1,620 | |||||
Other current assets | 46,096 | 44,820 | |||||
Total Current Assets | 553,858 | 528,770 | |||||
Other Assets | 42,834 | 42,647 | |||||
Other Intangibles | 80,577 | 83,320 | |||||
Property and Equipment, net | 128,185 | 129,712 | |||||
Goodwill | 495,095 | 496,605 | |||||
Total Assets | $ | 1,300,549 | $ | 1,281,054 | |||
Liabilities and Shareholders’ Equity | |||||||
Current Liabilities | |||||||
Accounts payable | $ | 160,974 | $ | 148,805 | |||
Accrued expenses | 124,991 | 132,595 | |||||
Accrued income taxes | 150 | 1,495 | |||||
Short-term debt and current maturities of long-term obligations | 7,371 | 5,044 | |||||
Total Current Liabilities | 293,486 | 287,939 | |||||
Long-Term Debt | 260,276 | 260,440 | |||||
Other Long-Term Obligations | 109,706 | 106,150 | |||||
Shareholders’ Equity | |||||||
Preferred Shares (Authorized 300 shares; none outstanding) | — | — | |||||
Common Shares (Authorized 100,000 shares; 33,836 and 33,835 issued in 2012 and 2011, respectively)—no par | 8,471 | 8,471 | |||||
Class B Common Shares (Authorized 12,000 shares; 1,086 and 1,086, issued and outstanding in 2012 and 2011, respectively)—no par | 272 | 272 | |||||
Additional paid-in-capital | 222,943 | 221,409 | |||||
Retained earnings | 372,136 | 364,300 | |||||
Accumulated other comprehensive earnings | 126,062 | 124,876 | |||||
Treasury shares | (92,803 | ) | (92,803 | ) | |||
Total Shareholders’ Equity | 637,081 | 626,525 | |||||
Total Liabilities and Shareholders’ Equity | $ | 1,300,549 | $ | 1,281,054 |
For the Three Months Ended | ||||||||
March 31, | ||||||||
2012 | 2011 | |||||||
Operating Activities | (In thousands) | |||||||
Net earnings | $ | 8,233 | $ | 7,454 | ||||
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 9,632 | 8,795 | ||||||
Provision for losses on trade and installment receivables | 1,440 | 3,392 | ||||||
Provision (Benefit) for deferred income taxes | 41 | (233 | ) | |||||
Provision for other deferred liabilities | 220 | 694 | ||||||
Provision for stock-based compensation | 1,534 | 1,412 | ||||||
Loss on disposals of property and equipment | 7 | 158 | ||||||
Loss on debt extinguishment including debt finance charges and associated fees | — | 4,881 | ||||||
Amortization of convertible debt discount | 141 | 593 | ||||||
Changes in operating assets and liabilities: | ||||||||
Trade receivables | (7,967 | ) | 1,412 | |||||
Installment sales contracts, net | 2,060 | (320 | ) | |||||
Inventories | (20,615 | ) | (4,660 | ) | ||||
Other current assets | 596 | (316 | ) | |||||
Accounts payable | 11,805 | (575 | ) | |||||
Accrued expenses | (9,394 | ) | (15,278 | ) | ||||
Other long-term liabilities | 1,442 | 1,534 | ||||||
Net Cash Provided (Used) by Operating Activities | (825 | ) | 8,943 | |||||
Investing Activities | ||||||||
Purchases of property and equipment | (4,681 | ) | (3,353 | ) | ||||
Proceeds from sale of property and equipment | 45 | 14 | ||||||
(Increase) Decrease in other long-term assets | (11 | ) | (206 | ) | ||||
Other | 20 | (161 | ) | |||||
Net Cash Used for Investing Activities | (4,627 | ) | (3,706 | ) | ||||
Financing Activities | ||||||||
Proceeds from revolving lines of credit and long-term borrowings | 75,508 | 112,292 | ||||||
Payments on revolving lines of credit and long-term borrowings | (72,480 | ) | (117,558 | ) | ||||
Proceeds from exercise of stock options | — | 2,068 | ||||||
Payment of financing costs | — | (4,507 | ) | |||||
Payment of dividends | (397 | ) | (401 | ) | ||||
Purchase of treasury stock | — | (14,644 | ) | |||||
Net Cash Provided (Used) by Financing Activities | 2,631 | (22,750 | ) | |||||
Effect of exchange rate changes on cash | 565 | 1,683 | ||||||
Increase (Decrease) in cash and cash equivalents | (2,256 | ) | (15,830 | ) | ||||
Cash and cash equivalents at beginning of year | 34,924 | 48,462 | ||||||
Cash and cash equivalents at end of year | $ | 32,668 | $ | 32,632 |
For the Three Months Ended | ||||||||
March 31, | ||||||||
2012 | 2011 | |||||||
Stock-based compensation expense recognized as part of selling, general and administrative expense | $ | 1,534 | $ | 1,412 |
March 31, 2012 | December 31, 2011 | ||||||||||||||||||||||
Current | Long- Term | Total | Current | Long- Term | Total | ||||||||||||||||||
Installment receivables | $ | 7,213 | $ | 2,211 | $ | 9,424 | $ | 8,990 | $ | 2,931 | $ | 11,921 | |||||||||||
Less: | |||||||||||||||||||||||
Unearned interest | (140 | ) | — | (140 | ) | (171 | ) | — | (171 | ) | |||||||||||||
7,073 | 2,211 | 9,284 | 8,819 | 2,931 | 11,750 | ||||||||||||||||||
Allowance for doubtful accounts | (2,531 | ) | (1,578 | ) | (4,109 | ) | (2,148 | ) | (2,125 | ) | (4,273 | ) | |||||||||||
$ | 4,542 | $ | 633 | $ | 5,175 | $ | 6,671 | $ | 806 | $ | 7,477 |
For the Three Months Ended | Year Ended | ||||||
March 31, 2012 | December 31, 2011 | ||||||
Balance as of beginning of period | $ | 4,273 | $ | 4,841 | |||
Current period provision | 355 | 1,215 | |||||
Direct write-offs charged against the allowance | (519 | ) | (1,783 | ) | |||
Balance as of end of period | $ | 4,109 | $ | 4,273 |
Total Installment Receivables | Unpaid Principal Balance | Related Allowance for Doubtful Accounts | Interest Income Recognized | ||||||||||||
U.S. | |||||||||||||||
Impaired Installment receivables with a related allowance recorded | $ | 5,499 | $ | 5,499 | $ | 3,804 | $ | — | |||||||
Canada | |||||||||||||||
Non-Impaired Installment receivables with no related allowance recorded | 3,620 | 3,480 | — | 27 | |||||||||||
Impaired Installment receivables with a related allowance recorded | 305 | 305 | 305 | — | |||||||||||
Total Canadian Installment Receivables | $ | 3,925 | $ | 3,785 | $ | 305 | $ | 27 | |||||||
Total | |||||||||||||||
Non-Impaired Installment receivables with no related allowance recorded | 3,620 | 3,480 | — | 27 | |||||||||||
Impaired Installment receivables with a related allowance recorded | 5,804 | 5,804 | 4,109 | — | |||||||||||
Total Installment Receivables | $ | 9,424 | $ | 9,284 | $ | 4,109 | $ | 27 |
Total Installment Receivables | Unpaid Principal Balance | Related Allowance for Doubtful Accounts | Interest Income Recognized | ||||||||||||
U.S. | |||||||||||||||
Impaired Installment receivables with a related allowance recorded | $ | 6,116 | $ | 6,116 | $ | 4,240 | $ | — | |||||||
Canada | |||||||||||||||
Non-Impaired Installment receivables with no related allowance recorded | 5,696 | 5,525 | — | 271 | |||||||||||
Impaired Installment receivables with a related allowance recorded | 109 | 109 | 33 | — | |||||||||||
Total Canadian Installment Receivables | $ | 5,805 | $ | 5,634 | $ | 33 | $ | 271 | |||||||
Total | |||||||||||||||
Non-Impaired Installment receivables with no related allowance recorded | 5,696 | 5,525 | — | 271 | |||||||||||
Impaired Installment receivables with a related allowance recorded | 6,225 | 6,225 | 4,273 | — | |||||||||||
Total Installment Receivables | $ | 11,921 | $ | 11,750 | $ | 4,273 | $ | 271 |
March 31, 2012 | December 31, 2011 | ||||||||||||||||||||||
Total | U.S. | Canada | Total | U.S. | Canada | ||||||||||||||||||
Current | $ | 3,431 | $ | — | $ | 3,431 | $ | 5,612 | $ | — | $ | 5,612 | |||||||||||
0-30 Days Past Due | 122 | — | 122 | 84 | — | 84 | |||||||||||||||||
31-60 Days Past Due | 44 | — | 44 | 42 | — | 42 | |||||||||||||||||
61-90 Days Past Due | 20 | — | 20 | 8 | — | 8 | |||||||||||||||||
90+ Days Past Due | 5,807 | 5,499 | 308 | 6,175 | 6,116 | 59 | |||||||||||||||||
$ | 9,424 | $ | 5,499 | $ | 3,925 | $ | 11,921 | $ | 6,116 | $ | 5,805 |
March 31, | December 31, | ||||||
2012 | 2011 | ||||||
Finished goods | $ | 124,143 | $ | 116,378 | |||
Raw materials | 75,725 | 63,244 | |||||
Work in process | 14,287 | 13,139 | |||||
$ | 214,155 | $ | 192,761 |
March 31, 2012 | December 31, 2011 | ||||||
Machinery and equipment | $ | 364,321 | $ | 360,215 | |||
Land, buildings and improvements | 95,933 | 95,737 | |||||
Furniture and fixtures | 14,247 | 14,034 | |||||
Leasehold improvements | 16,052 | 15,750 | |||||
490,553 | 485,736 | ||||||
Less allowance for depreciation | (362,368 | ) | (356,024 | ) | |||
$ | 128,185 | $ | 129,712 |
March 31, 2012 | December 31, 2011 | ||||||||||||||
Historical Cost | Accumulated Amortization | Historical Cost | Accumulated Amortization | ||||||||||||
Customer Lists | $ | 94,618 | $ | 52,958 | $ | 94,790 | $ | 50,832 | |||||||
Trademarks | 31,756 | — | 31,777 | — | |||||||||||
License agreements | 3,203 | 3,203 | 3,160 | 3,160 | |||||||||||
Developed Technology | 9,638 | 4,872 | 9,823 | 4,870 | |||||||||||
Patents | 6,380 | 5,394 | 6,358 | 5,266 | |||||||||||
Other | 7,562 | 6,153 | 7,510 | 5,970 | |||||||||||
$ | 153,157 | $ | 72,580 | $ | 153,418 | $ | 70,098 |
Balance as of January 1, 2012 | $ | 19,842 | |
Warranties provided during the period | 3,350 | ||
Settlements made during the period | (3,132 | ) | |
Changes in liability for pre-existing warranties during the period, including expirations | 885 | ||
Balance as of March 31, 2012 | $ | 20,945 |
March 31, 2012 | December 31, 2011 | ||||||
$400,000,000 senior secured revolving credit facility, due in October 2015 | $ | 249,438 | $ | 247,063 | |||
Convertible senior subordinated debentures at 4.125%, due in February 2027 | 9,938 | 9,797 | |||||
Other notes and lease obligations | 8,271 | 8,624 | |||||
267,647 | 265,484 | ||||||
Less current maturities of long-term debt | (7,371 | ) | (5,044 | ) | |||
$ | 260,276 | $ | 260,440 |
March 31, 2012 | December 31, 2011 | ||||||
Principal amount of liability component | $ | 13,850 | $ | 13,850 | |||
Unamortized discount | (3,912 | ) | (4,053 | ) | |||
Net carrying amount of liability component | $ | 9,938 | $ | 9,797 |
March 31, 2012 | Weighted Average Exercise Price | |||||
Options outstanding at January 1, 2012 | 4,455,365 | 28.99 | ||||
Granted | 11,542 | 17.54 | ||||
Exercised | — | 0.00 | ||||
Canceled | (80,162 | ) | 27.96 | |||
Options outstanding at March 31, 2012 | 4,386,745 | 28.99 | ||||
Options exercise price range at March 31, 2012 | 10.70 to | |||||
$ | 47.80 | |||||
Options exercisable at March 31, 2012 | 2,915,989 | |||||
Options available for grant at March 31, 2012* | 1,970,134 |
* | Options available for grant as of March 31, 2012 reduced by net restricted stock award activity of 585,007. |
Options Outstanding | Options Exercisable | ||||||||||||||
Exercise Prices | Number Outstanding At 3/31/12 | Weighted Average Remaining Contractual Life | Weighted Average Exercise Price | Number Exercisable At 3/31/12 | Weighted Average Exercise Price | ||||||||||
$ 10.70 – $15.00 | 15,153 | 3.8 years | $ | 12.10 | 10,153 | $ | 10.70 | ||||||||
$ 15.01 – $25.00 | 1,835,951 | 7.2 | 22.51 | 926,044 | 22.11 | ||||||||||
$ 25.01 – $35.00 | 1,207,050 | 6.7 | 26.24 | 651,201 | 26.83 | ||||||||||
$ 35.01 – $47.80 | 1,328,591 | 2.1 | 40.63 | 1,328,591 | 40.63 | ||||||||||
Total | 4,386,745 | 5.5 | $ | 28.99 | 2,915,989 | $ | 31.56 |
For the Three Months Ended | |||||||
(In thousands except per share data) | March 31, | ||||||
2012 | 2011 | ||||||
Basic | |||||||
Average common shares outstanding | 31,819 | 32,174 | |||||
Net earnings | $ | 8,233 | $ | 7,454 | |||
Net earnings per common share | $ | 0.26 | $ | 0.23 | |||
Diluted | |||||||
Average common shares outstanding | 31,819 | 32,174 | |||||
Shares related to convertible debt | — | 488 | |||||
Stock options and awards | 3 | 353 | |||||
Average common shares assuming dilution | 31,822 | 33,015 | |||||
Net earnings | $ | 8,233 | $ | 7,454 | |||
Net earnings per common share | $ | 0.26 | $ | 0.23 |
March 31, 2012 | December 31, 2011 | ||||||||||||||
Notional Amount | Unrealized Net Gain (Loss) | Notional Amount | Unrealized Net Gain (Loss) | ||||||||||||
USD / AUD | $ | 2,559 | $ | 26 | $ | 3,324 | $ | 104 | |||||||
USD / CAD | 21,482 | 125 | 8,424 | 29 | |||||||||||
USD / CNY | 6,870 | 3 | 8,130 | (16 | ) | ||||||||||
USD / EUR | 41,014 | 576 | 42,267 | 701 | |||||||||||
USD / GBP | 1,396 | (6 | ) | 1,806 | 19 | ||||||||||
USD / NZD | 6,192 | 204 | 8,256 | 86 | |||||||||||
USD / SEK | 9,974 | 149 | 4,520 | 19 | |||||||||||
USD / MXP | 9,298 | 776 | 14,029 | (146 | ) | ||||||||||
EUR / AUD | 866 | (27 | ) | 1,220 | (48 | ) | |||||||||
EUR / CAD | 1,896 | 9 | — | — | |||||||||||
EUR / CHF | 4,084 | 42 | 5,433 | (22 | ) | ||||||||||
EUR / GBP | 17,148 | (262 | ) | 17,201 | 9 | ||||||||||
EUR / SEK | 1,503 | (11 | ) | — | — | ||||||||||
EUR / NOK | 1,327 | (12 | ) | — | — | ||||||||||
EUR / NZD | 5,837 | 526 | 7,009 | 505 | |||||||||||
GBP / CHF | 731 | (11 | ) | 929 | (5 | ) | |||||||||
GBP / SEK | 3,166 | 64 | 1,690 | 12 | |||||||||||
CHF / SEK | 318 | (9 | ) | 271 | (2 | ) | |||||||||
NOK / CHF | 701 | (15 | ) | 436 | (1 | ) | |||||||||
$ | 136,362 | $ | 2,147 | $ | 124,945 | $ | 1,244 |
March 31, 2012 | March 31, 2011 | ||||||||||||||
Notional Amount | Gain (Loss) | Notional Amount | Gain (Loss) | ||||||||||||
CAD / USD | $ | 7,138 | $ | 77 | $ | 17,131 | $ | 404 | |||||||
CHF / USD | 3,315 | 63 | — | — | |||||||||||
DKK / USD | 8,137 | (73 | ) | — | — | ||||||||||
NOK / USD | — | — | 5,268 | 157 | |||||||||||
NZD / USD | 1,377 | 7 | — | — | |||||||||||
CHF / GBP | — | — | 7,107 | 256 | |||||||||||
SEK / CAD | 2,483 | (2 | ) | — | — | ||||||||||
AUD / NZD | 1,066 | 11 | — | — | |||||||||||
EUR / NZD | — | — | 145 | 6 | |||||||||||
$ | 23,516 | $ | 83 | $ | 29,651 | $ | 823 |
March 31, 2012 | December 31, 2011 | ||||||||||||||
Assets | Liabilities | Assets | Liabilities | ||||||||||||
Derivatives designated as hedging instruments under ASC 815 | |||||||||||||||
Foreign currency forward contracts | $ | 2,772 | $ | 625 | $ | 1,621 | $ | 377 | |||||||
Interest rate swap contracts | $ | — | $ | 480 | $ | 18 | $ | 388 | |||||||
Derivatives not designated as hedging instruments under ASC 815 | |||||||||||||||
Foreign currency forward contracts | 161 | 78 | 64 | 128 | |||||||||||
Total derivatives | $ | 2,933 | $ | 1,183 | $ | 1,703 | $ | 893 |
Derivatives in ASC 815 cash flow hedge relationships | Amount of Gain (Loss) Recognized in OCI on Derivatives (Effective Portion) | Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | Amount of Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) | ||||||||
Three months ended March 31, 2012 | |||||||||||
Foreign currency forward contracts | $ | 10 | $ | 779 | $ | — | |||||
Interest rate swap contracts | 110 | — | — | ||||||||
$ | 120 | $ | 779 | $ | — | ||||||
Three months ended March 31, 2011 | |||||||||||
Foreign currency forward contracts | $ | (1,249 | ) | $ | 62 | $ | 6 | ||||
Interest rate swap contracts | (129 | ) | — | — | |||||||
$ | (1,378 | ) | $ | 62 | $ | 6 | |||||
Derivatives not designated as hedging instruments under ASC 815 | Amount of Gain (Loss) Recognized in Income on Derivatives | ||||||||||
Three months ended March 31, 2012 | |||||||||||
Foreign currency forward contracts | $ | 83 | |||||||||
Three months ended March 31, 2011 | |||||||||||
Foreign currency forward contracts | $ | 817 |
Basis for Fair Value Measurements at Reporting Date | |||||||||||||
Quoted Prices in Active Markets for Identical Assets / (Liabilities) | Significant Other Observable Inputs | Significant Other Unobservable Inputs | |||||||||||
Total | Level I | Level II | Level III | ||||||||||
March 31, 2012: | |||||||||||||
Forward Exchange Contracts—net | $ | 2,230 | — | $ | 2,230 | — | |||||||
Interest Rate Swap Agreements—net | (480 | ) | (480 | ) | |||||||||
December 31, 2011: | |||||||||||||
Forward Exchange Contracts—net | $ | 1,180 | — | $ | 1,180 | — | |||||||
Interest Rate Swap Agreements—net | (370 | ) | (370 | ) |
March 31, 2012 | December 31, 2011 | ||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||
Cash and cash equivalents | $ | 32,668 | $ | 32,668 | $ | 34,924 | $ | 34,924 | |||||||
Other investments | 1,312 | 1,312 | 1,362 | 1,362 | |||||||||||
Installment receivables, net of reserves | 5,175 | 5,175 | 7,477 | 7,477 | |||||||||||
Long-term debt (including current maturities of long-term debt) | (267,647 | ) | (266,497 | ) | (265,484 | ) | (264,112 | ) | |||||||
Forward contracts in Other Current Assets | 2,933 | 2,933 | 1,685 | 1,685 | |||||||||||
Forward contracts in Accrued Expenses | (703 | ) | (703 | ) | (505 | ) | (505 | ) | |||||||
Interest Rate Swap Agreements in Other Current Assets | — | — | 18 | 18 | |||||||||||
Interest Rate Swap Agreements in Accrued Expenses | (480 | ) | (480 | ) | (388 | ) | (388 | ) |
For the Three Months Ended | |||||||
March 31, | |||||||
2012 | 2011 | ||||||
Revenues from external customers | |||||||
North America/HME | $ | 176,118 | $ | 181,831 | |||
Invacare Supply Group | 78,465 | 74,046 | |||||
Institutional Products Group | 36,138 | 31,423 | |||||
Europe | 125,303 | 121,387 | |||||
Asia/Pacific | 17,540 | 19,811 | |||||
Consolidated | $ | 433,564 | $ | 428,498 | |||
Intersegment revenues | |||||||
North America/HME | $ | 29,130 | $ | 20,810 | |||
Invacare Supply Group | 19 | 16 | |||||
Institutional Products Group | 1,824 | 2,193 | |||||
Europe | 1,978 | 1,846 | |||||
Asia/Pacific | 10,530 | 7,946 | |||||
Consolidated | $ | 43,481 | $ | 32,811 | |||
Restructuring charges before income taxes | |||||||
North America/HME | $ | 117 | $ | — | |||
Invacare Supply Group | (13 | ) | — | ||||
Institutional Products Group | 35 | — | |||||
Europe | 291 | — | |||||
Asia/Pacific | 118 | — | |||||
All Other (1) | — | — | |||||
Consolidated | $ | 548 | $ | — | |||
Earnings (loss) before income taxes | |||||||
North America/HME | $ | 7,556 | $ | 13,249 | |||
Invacare Supply Group | 1,250 | 1,195 | |||||
Institutional Products Group | 3,378 | 4,124 | |||||
Europe | 5,485 | 4,960 | |||||
Asia/Pacific | (1,061 | ) | 1,051 | ||||
All Other (1) | (6,225 | ) | (14,575 | ) | |||
Consolidated | $ | 10,383 | $ | 10,004 |
(1) | Consists of un-allocated corporate SG&A costs and intercompany profits, which do not meet the quantitative criteria for determining reportable segments. In addition, the “All Other” earnings (loss) before income taxes includes loss on debt extinguishment including debt finance charges, interest and fees. |
Severance | Product Line Discontinuance | Contract Terminations | Other | Total | |||||||||||||||
December 31, 2010 Balance | |||||||||||||||||||
Total | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||
Charges | |||||||||||||||||||
NA/HME | 4,756 | — | — | 4 | 4,760 | ||||||||||||||
IPG | 123 | — | — | — | 123 | ||||||||||||||
ISG | 335 | — | — | — | 335 | ||||||||||||||
Europe | 3,288 | 277 | 1,788 | 113 | 5,466 | ||||||||||||||
Asia/Pacific | 186 | — | — | — | 186 | ||||||||||||||
Total | 8,688 | 277 | 1,788 | 117 | 10,870 | ||||||||||||||
Payments | |||||||||||||||||||
NA/HME | (1,664 | ) | — | — | (4 | ) | (1,668 | ) | |||||||||||
IPG | (52 | ) | — | — | — | (52 | ) | ||||||||||||
ISG | (82 | ) | — | — | — | (82 | ) | ||||||||||||
Europe | (1,546 | ) | (277 | ) | (1,714 | ) | (113 | ) | (3,650 | ) | |||||||||
Asia/Pacific | (186 | ) | — | — | — | (186 | ) | ||||||||||||
Total | (3,530 | ) | (277 | ) | (1,714 | ) | (117 | ) | (5,638 | ) | |||||||||
December 31, 2011 Balance | |||||||||||||||||||
NA/HME | 3,092 | — | — | — | 3,092 | ||||||||||||||
IPG | 71 | — | — | — | 71 | ||||||||||||||
ISG | 253 | — | — | — | 253 | ||||||||||||||
Europe | 1,742 | — | 74 | — | 1,816 | ||||||||||||||
Asia/Pacific | — | — | — | — | — | ||||||||||||||
Total | $ | 5,158 | $ | — | $ | 74 | $ | — | $ | 5,232 | |||||||||
Charges | |||||||||||||||||||
NA/HME | 117 | — | — | — | 117 | ||||||||||||||
IPG | 35 | — | — | — | 35 | ||||||||||||||
ISG | (13 | ) | — | — | — | (13 | ) | ||||||||||||
Europe | 257 | — | 34 | — | 291 | ||||||||||||||
Asia/Pacific | 118 | — | — | — | 118 | ||||||||||||||
Total | 514 | — | 34 | — | 548 | ||||||||||||||
Payments | |||||||||||||||||||
NA/HME | (1,130 | ) | — | — | — | (1,130 | ) | ||||||||||||
IPG | (82 | ) | — | — | — | (82 | ) | ||||||||||||
ISG | (99 | ) | — | — | — | (99 | ) | ||||||||||||
Europe | (1,541 | ) | — | (56 | ) | — | (1,597 | ) | |||||||||||
Asia/Pacific | (118 | ) | — | — | — | (118 | ) | ||||||||||||
Total | (2,970 | ) | — | (56 | ) | — | (3,026 | ) | |||||||||||
March 31, 2012 Balance | |||||||||||||||||||
NA/HME | 2,079 | — | — | — | 2,079 | ||||||||||||||
IPG | 24 | — | — | — | 24 | ||||||||||||||
ISG | 141 | — | — | — | 141 | ||||||||||||||
Europe | 458 | — | 52 | — | 510 | ||||||||||||||
Asia/Pacific | — | — | — | — | — | ||||||||||||||
Total | $ | 2,702 | $ | — | $ | 52 | $ | — | $ | 2,754 |
The Company (Parent) | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Eliminations | Total | |||||||||||||||
(in thousands) | |||||||||||||||||||
Three month period ended March 31, 2012 | |||||||||||||||||||
Net sales | $ | 90,032 | $ | 203,117 | $ | 173,388 | $ | (32,973 | ) | $ | 433,564 | ||||||||
Cost of products sold | 67,952 | 159,397 | 119,415 | (32,769 | ) | 313,995 | |||||||||||||
Gross Profit | 22,080 | 43,720 | 53,973 | (204 | ) | 119,569 | |||||||||||||
Selling, general and administrative expenses | 32,769 | 29,669 | 45,061 | — | 107,499 | ||||||||||||||
Charge related to restructuring activities | 6 | 8 | 534 | — | 548 | ||||||||||||||
Income (loss) from equity investee | 18,246 | 1,044 | 199 | (19,489 | ) | — | |||||||||||||
Interest expense (income)—net | (870 | ) | 1,249 | 760 | — | 1,139 | |||||||||||||
Earnings (loss) before Income Taxes | 8,421 | 13,838 | 7,817 | (19,693 | ) | 10,383 | |||||||||||||
Income taxes | 188 | 87 | 1,875 | — | 2,150 | ||||||||||||||
Net Earnings (loss) | $ | 8,233 | $ | 13,751 | $ | 5,942 | $ | (19,693 | ) | $ | 8,233 | ||||||||
Other Comprehensive Income, Net of Tax | 1,186 | 1,845 | (150 | ) | (1,695 | ) | 1,186 | ||||||||||||
Comprehensive Income | $ | 9,419 | $ | 15,596 | $ | 5,792 | $ | (21,388 | ) | $ | 9,419 |
The Company (Parent) | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Eliminations | Total | |||||||||||||||
Three month period ended March 31, 2011 | (in thousands) | ||||||||||||||||||
Net sales | $ | 92,232 | $ | 189,627 | $ | 170,813 | $ | (24,174 | ) | $ | 428,498 | ||||||||
Cost of products sold | 66,338 | 149,050 | 114,362 | (24,258 | ) | 305,492 | |||||||||||||
Gross Profit | 25,894 | 40,577 | 56,451 | 84 | 123,006 | ||||||||||||||
Selling, general and administrative expenses | 32,700 | 14,193 | 45,510 | 13,374 | 105,777 | ||||||||||||||
Loss on debt extinguishment including debt finance charges and associated fees | 4,881 | — | — | — | 4,881 | ||||||||||||||
Income (loss) from equity investee | 20,824 | 4,335 | (21 | ) | (25,138 | ) | — | ||||||||||||
Interest expense—net | 1,063 | 377 | 904 | — | 2,344 | ||||||||||||||
Earnings (loss) before Income Taxes | 8,074 | 30,342 | 10,016 | (38,428 | ) | 10,004 | |||||||||||||
Income taxes | 620 | 100 | 1,830 | — | 2,550 | ||||||||||||||
Net Earnings (loss) | $ | 7,454 | $ | 30,242 | $ | 8,186 | $ | (38,428 | ) | $ | 7,454 | ||||||||
Other Comprehensive Income, Net of Tax | 33,938 | 2,386 | 32,453 | (34,839 | ) | 33,938 | |||||||||||||
Comprehensive Income | $ | 41,392 | $ | 32,628 | $ | 40,639 | $ | (73,267 | ) | $ | 41,392 |
The Company (Parent) | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Eliminations | Total | |||||||||||||||
(in thousands) | |||||||||||||||||||
March 31, 2012 | |||||||||||||||||||
Assets | |||||||||||||||||||
Current Assets | |||||||||||||||||||
Cash and cash equivalents | $ | 4,061 | $ | 2,463 | $ | 26,144 | $ | — | $ | 32,668 | |||||||||
Trade receivables, net | 81,068 | 80,116 | 94,175 | — | 255,359 | ||||||||||||||
Installment receivables, net | — | 1,146 | 3,396 | — | 4,542 | ||||||||||||||
Inventories, net | 40,103 | 57,070 | 118,944 | (1,962 | ) | 214,155 | |||||||||||||
Deferred income taxes | 422 | 45 | 571 | — | 1,038 | ||||||||||||||
Other current assets | 9,875 | 6,758 | 33,013 | (3,550 | ) | 46,096 | |||||||||||||
Total Current Assets | 135,529 | 147,598 | 276,243 | (5,512 | ) | 553,858 | |||||||||||||
Investment in subsidiaries | 1,581,133 | 527,199 | — | (2,108,332 | ) | — | |||||||||||||
Intercompany advances, net | 80,537 | 850,233 | 209,049 | (1,139,819 | ) | — | |||||||||||||
Other Assets | 41,167 | 549 | 1,118 | — | 42,834 | ||||||||||||||
Other Intangibles | 737 | 25,768 | 54,072 | — | 80,577 | ||||||||||||||
Property and Equipment, net | 44,034 | 18,905 | 65,246 | — | 128,185 | ||||||||||||||
Goodwill | — | 55,893 | 439,202 | — | 495,095 | ||||||||||||||
Total Assets | $ | 1,883,137 | $ | 1,626,145 | $ | 1,044,930 | $ | (3,253,663 | ) | $ | 1,300,549 | ||||||||
Liabilities and Shareholders’ Equity | |||||||||||||||||||
Current Liabilities | |||||||||||||||||||
Accounts payable | $ | 73,251 | $ | 18,476 | $ | 69,247 | $ | — | $ | 160,974 | |||||||||
Accrued expenses | 32,694 | 22,211 | 73,636 | (3,550 | ) | 124,991 | |||||||||||||
Accrued income taxes | 13 | — | 137 | — | 150 | ||||||||||||||
Short-term debt and current maturities of long-term obligations | 6,566 | — | 805 | — | 7,371 | ||||||||||||||
Total Current Liabilities | 112,524 | 40,687 | 143,825 | (3,550 | ) | 293,486 | |||||||||||||
Long-Term Debt | 252,967 | 207 | 7,102 | — | 260,276 | ||||||||||||||
Other Long-Term Obligations | 49,050 | 8,313 | 52,343 | — | 109,706 | ||||||||||||||
Intercompany advances, net | 831,515 | 214,195 | 94,111 | (1,139,821 | ) | — | |||||||||||||
Total Shareholders’ Equity | 637,081 | 1,362,743 | 747,549 | (2,110,292 | ) | 637,081 | |||||||||||||
Total Liabilities and Shareholders’ Equity | $ | 1,883,137 | $ | 1,626,145 | $ | 1,044,930 | $ | (3,253,663 | ) | $ | 1,300,549 |
The Company (Parent) | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Eliminations | Total | |||||||||||||||
(in thousands) | |||||||||||||||||||
December 31, 2011 | |||||||||||||||||||
Assets | |||||||||||||||||||
Current Assets | |||||||||||||||||||
Cash and cash equivalents | $ | 3,642 | $ | 2,104 | $ | 29,178 | $ | — | $ | 34,924 | |||||||||
Trade receivables, net | 83,522 | 74,161 | 90,291 | — | 247,974 | ||||||||||||||
Installment receivables, net | — | 1,180 | 5,491 | — | 6,671 | ||||||||||||||
Inventories, net | 45,937 | 49,336 | 99,006 | (1,518 | ) | 192,761 | |||||||||||||
Deferred income taxes | 422 | 45 | 1,153 | — | 1,620 | ||||||||||||||
Other current assets | 10,171 | 6,517 | 33,812 | (5,680 | ) | 44,820 | |||||||||||||
Total Current Assets | 143,694 | 133,343 | 258,931 | (7,198 | ) | 528,770 | |||||||||||||
Investment in subsidiaries | 1,560,693 | 524,800 | — | (2,085,493 | ) | — | |||||||||||||
Intercompany advances, net | 79,598 | 846,829 | 200,157 | (1,126,584 | ) | — | |||||||||||||
Other Assets | 40,813 | 698 | 1,136 | — | 42,647 | ||||||||||||||
Other Intangibles | 821 | 26,838 | 55,661 | — | 83,320 | ||||||||||||||
Property and Equipment, net | 45,459 | 17,770 | 66,483 | — | 129,712 | ||||||||||||||
Goodwill | — | 54,894 | 441,711 | — | 496,605 | ||||||||||||||
Total Assets | $ | 1,871,078 | $ | 1,605,172 | $ | 1,024,079 | $ | (3,219,275 | ) | $ | 1,281,054 | ||||||||
Liabilities and Shareholders’ Equity | |||||||||||||||||||
Current Liabilities | |||||||||||||||||||
Accounts payable | $ | 73,948 | $ | 18,078 | $ | 56,779 | $ | — | $ | 148,805 | |||||||||
Accrued expenses | 37,708 | 21,038 | 79,529 | (5,680 | ) | 132,595 | |||||||||||||
Accrued income taxes | 508 | — | 987 | — | 1,495 | ||||||||||||||
Short-term debt and current maturities of long-term obligations | 4,210 | 4 | 830 | — | 5,044 | ||||||||||||||
Total Current Liabilities | 116,374 | 39,120 | 138,125 | (5,680 | ) | 287,939 | |||||||||||||
Long-Term Debt | 252,855 | 227 | 7,358 | — | 260,440 | ||||||||||||||
Other Long-Term Obligations | 47,873 | 7,312 | 50,965 | — | 106,150 | ||||||||||||||
Intercompany advances, net | 827,451 | 210,005 | 89,128 | (1,126,584 | ) | — | |||||||||||||
Total Shareholders’ Equity | 626,525 | 1,348,508 | 738,503 | (2,087,011 | ) | 626,525 | |||||||||||||
Total Liabilities and Shareholders’ Equity | $ | 1,871,078 | $ | 1,605,172 | $ | 1,024,079 | $ | (3,219,275 | ) | $ | 1,281,054 |
The Company (Parent) | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Eliminations | Total | |||||||||||||||
(in thousands) | |||||||||||||||||||
Three month period ended March 31, 2012 | |||||||||||||||||||
Net Cash Provided (Used) by Operating Activities | $ | (483 | ) | $ | 1,074 | $ | (1,416 | ) | $ | — | $ | (825 | ) | ||||||
Investing Activities | |||||||||||||||||||
Purchases of property and equipment | (553 | ) | (2,546 | ) | (1,582 | ) | — | (4,681 | ) | ||||||||||
Proceeds from sale of property and equipment | 12 | 17 | 16 | — | 45 | ||||||||||||||
Other long-term assets | — | — | (11 | ) | — | (11 | ) | ||||||||||||
Other | 48 | — | (28 | ) | — | 20 | |||||||||||||
Net Cash Used for Investing Activities | (493 | ) | (2,529 | ) | (1,605 | ) | — | (4,627 | ) | ||||||||||
Financing Activities | |||||||||||||||||||
Proceeds from revolving lines of credit and long-term borrowings | 73,694 | 1,814 | — | — | 75,508 | ||||||||||||||
Payments on revolving lines of credit and long-term borrowings | (71,902 | ) | — | (578 | ) | — | (72,480 | ) | |||||||||||
Payment of dividends | (397 | ) | — | — | — | (397 | ) | ||||||||||||
Net Cash Provided (Used) by Financing Activities | 1,395 | 1,814 | (578 | ) | — | 2,631 | |||||||||||||
Effect of exchange rate changes on cash | — | — | 565 | — | 565 | ||||||||||||||
Increase (decrease) in cash and cash equivalents | 419 | 359 | (3,034 | ) | — | (2,256 | ) | ||||||||||||
Cash and cash equivalents at beginning of year | 3,642 | 2,104 | 29,178 | — | 34,924 | ||||||||||||||
Cash and cash equivalents at end of year | $ | 4,061 | $ | 2,463 | $ | 26,144 | $ | — | $ | 32,668 |
The Company (Parent) | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Eliminations | Total | |||||||||||||||
(in thousands) | |||||||||||||||||||
Three month period ended March 31, 2011 | |||||||||||||||||||
Net Cash Provided (Used) by Operating Activities | $ | 31,725 | $ | (342 | ) | $ | (9,066 | ) | $ | (13,374 | ) | $ | 8,943 | ||||||
Investing Activities | |||||||||||||||||||
Purchases of property and equipment | (817 | ) | (813 | ) | (1,723 | ) | — | (3,353 | ) | ||||||||||
Proceeds from sale of property and equipment | — | — | 14 | — | 14 | ||||||||||||||
Other long-term assets | (210 | ) | — | 4 | — | (206 | ) | ||||||||||||
Other | 32 | (4 | ) | (189 | ) | — | (161 | ) | |||||||||||
Net Cash Used for Investing Activities | (995 | ) | (817 | ) | (1,894 | ) | — | (3,706 | ) | ||||||||||
Financing Activities | |||||||||||||||||||
Proceeds from revolving lines of credit and long-term borrowings | 101,069 | — | 11,223 | — | 112,292 | ||||||||||||||
Payments on revolving lines of credit and long-term borrowings | (113,238 | ) | — | (4,320 | ) | — | (117,558 | ) | |||||||||||
Proceeds from exercise of stock options | 2,068 | — | — | — | 2,068 | ||||||||||||||
Payment of financing costs | (4,507 | ) | — | — | — | (4,507 | ) | ||||||||||||
Payment of dividends | (401 | ) | — | (13,374 | ) | 13,374 | (401 | ) | |||||||||||
Purchase of treasury stock | (14,644 | ) | — | — | — | (14,644 | ) | ||||||||||||
Net Cash Provided (Used) by Financing Activities | (29,653 | ) | — | (6,471 | ) | 13,374 | (22,750 | ) | |||||||||||
Effect of exchange rate changes on cash | — | — | 1,683 | — | 1,683 | ||||||||||||||
Increase (Decrease) in cash and cash equivalents | 1,077 | (1,159 | ) | (15,748 | ) | — | (15,830 | ) | |||||||||||
Cash and cash equivalents at beginning of year | 4,036 | 2,476 | 41,950 | — | 48,462 | ||||||||||||||
Cash and cash equivalents at end of year | $ | 5,113 | $ | 1,317 | $ | 26,202 | $ | — | $ | 32,632 |
Three Months Ended March 31, | |||||||
2012 | 2011 | ||||||
Net cash provided by operating activities | $ | (825 | ) | $ | 8,943 | ||
Plus: Net cash impact related to restructuring activities | 2,963 | — | |||||
Less: Purchases of property and equipment—net | (4,636 | ) | (3,339 | ) | |||
Free Cash Flow | $ | (2,498 | ) | $ | 5,604 |
Period | Total Number of Shares Purchased (1) | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs (2) | ||||||||||
1/1/2012 | - | 1/31/2012 | — | $ | — | — | 2,453,978 | |||||||
2/1/2012 | - | 2/29/2012 | — | — | — | 2,453,978 | ||||||||
3/1/2012 | - | 3/31/2012 | — | — | — | 2,453,978 | ||||||||
Total | — | $ | — | — | 2,453,978 |
(1) | No shares were repurchased between during the quarter and surrendered to the company by employees for minimum tax withholding purposes in conjunction with the vesting of restricted shares awarded to the employees under the company’s 2003 Performance Plan. |
(2) | In 2001, the Board of Directors authorized the company to purchase up to 2,000,000 Common Shares, excluding any shares acquired from employees or directors as a result of the exercise of options or vesting of restricted shares pursuant to the company’s performance plans. The Board of Directors reaffirmed its authorization of this repurchase program on November 5, 2010, and on August 17, 2011 authorized an additional 2,046,500 shares for repurchase under the plan. To date, the company has purchased 1,592,522 shares under this program, with authorization remaining to purchase 2,453,978 shares. The company purchased no shares pursuant to this Board authorized program during the first quarter of 2012. |
Exhibit No. | |
31.1 | Chief Executive Officer Rule 13a-14(a)/15d-14(a) Certification (filed herewith). |
31.2 | Chief Financial Officer Rule 13a-14(a)/15d-14(a) Certification (filed herewith). |
32.1 | Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith). |
32.2 | Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith). |
101.INS* | XBRL instance document |
101.SCH* | XBRL taxonomy extension schema |
101.CAL* | XBRL taxonomy extension calculation linkbase |
101.DEF* | XBRL taxonomy extension definition linkbase |
101.LAB* | XBRL taxonomy extension label linkbase |
101.PRE* | XBRL taxonomy extension presentation linkbase |
INVACARE CORPORATION | ||||
Date: | May 7, 2012 | By: | /s/ Robert K. Gudbranson | |
Name: Robert K. Gudbranson | ||||
Title: Chief Financial Officer | ||||
(As Principal Financial and Accounting Officer and on behalf of the registrant) |
1. | I have reviewed this quarterly report on Form 10-Q of Invacare Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
INVACARE CORPORATION | ||
/s/ GERALD B. BLOUCH | ||
Gerald B. Blouch Chief Executive Officer (Principal Executive Officer) | ||
Date: | May 7, 2012 |
1. | I have reviewed this quarterly report on Form 10-Q of Invacare Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
INVACARE CORPORATION | ||
/s/ ROBERT K. GUDBRANSON | ||
Robert K. Gudbranson Chief Financial Officer (Principal Financial Officer) | ||
Date: | May 7, 2012 |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the company. |
/s/ GERALD B. BLOUCH | ||
Gerald B. Blouch Chief Executive Officer | ||
Date: | May 7, 2012 |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the company. |
/s/ ROBERT K. GUDBRANSON | ||
Robert K. Gudbranson Chief Financial Officer | ||
Date: | May 7, 2012 |
Accounting Policies (Details) (USD $)
|
3 Months Ended | |
---|---|---|
Mar. 31, 2012
|
Mar. 31, 2011
|
|
Significant Accounting Policies [Line Items] | ||
Share-based Compensation | $ 1,534,000 | $ 1,412,000 |
Estimated Market for Medical Equipment and Supplies | $ 11,000,000,000 |
Long-Term Debt Convertible Debt (Details) (Convertible Subordinated Debt [Member], Convertible Senior Subordinated Debentures February 2027 [Member], USD $)
|
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2012
|
Dec. 31, 2011
|
Feb. 17, 2007
|
|
Convertible Subordinated Debt [Member] | Convertible Senior Subordinated Debentures February 2027 [Member]
|
|||
Debt Instrument [Line Items] | |||
Debt Instrument, Unamortized Discount | $ (3,912,000) | $ (4,053,000) | |
Principal Amount | $ 135,000,000 | ||
Interest Rate | 4.125% |
Other Intangibles Narrative (Details) (USD $)
|
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2012
|
Mar. 31, 2012
Trademarks [Member]
|
Dec. 31, 2011
Trademarks [Member]
|
|
Finite-Lived Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets | $ 31,756,000 | $ 31,777,000 | |
Finite-Lived Intangible Assets, Useful Life, Minimum | 3 | ||
Finite-Lived Intangible Assets, Useful Life, Maximum | 20 | ||
Finite Lived Intangible Assets, Useful Life Minimum for Majority of Assets | 10 | ||
Finite-Lived Intangible Assets, Average Useful Life | 13 | ||
Finite-Lived Intangible Assets, Amortization Expense | $ 2,569,000 |
Long-Term Debt Interest Rate Swaps (Details) (USD $)
|
Mar. 31, 2012
|
Dec. 31, 2011
|
---|---|---|
Derivative [Line Items] | ||
Long-term Debt, Weighted Average Interest Rate | 2.01% | 2.28% |
Interest Rate Derivative, September 2013, .0625% [Member] | Interest Rate Swap [Member]
|
||
Derivative [Line Items] | ||
Notional Amount of Interest Rate Derivatives | 18,000,000 | |
Derivative, Fixed Interest Rate on LIBOR Component | 0.625% | |
Derivative, Effective Aggregate Interest Rate | 2.375% | |
Interest Rate Derivative, September 2013, .46% [Member] | Interest Rate Swap [Member]
|
||
Derivative [Line Items] | ||
Notional Amount of Interest Rate Derivatives | 22,000,000 | |
Derivative, Fixed Interest Rate on LIBOR Component | 0.46% | |
Derivative, Effective Aggregate Interest Rate | 2.21% | |
Interest Rate Derivative, May 2013, 1.08% [Member] | Interest Rate Swap [Member]
|
||
Derivative [Line Items] | ||
Notional Amount of Interest Rate Derivatives | 20,000,000 | |
Derivative, Fixed Interest Rate on LIBOR Component | 1.08% | |
Derivative, Effective Aggregate Interest Rate | 2.83% | |
Interest Rate Derivative, May 2013, .73% [Member] | Interest Rate Swap [Member]
|
||
Derivative [Line Items] | ||
Notional Amount of Interest Rate Derivatives | 25,000,000 | |
Derivative, Fixed Interest Rate on LIBOR Component | 0.73% | |
Derivative, Effective Aggregate Interest Rate | 2.48% | |
Interest Rate Derivative, February 2013, 1.05% [Member] | Interest Rate Swap [Member]
|
||
Derivative [Line Items] | ||
Notional Amount of Interest Rate Derivatives | 15,000,000 | |
Derivative, Fixed Interest Rate on LIBOR Component | 1.05% | |
Derivative, Effective Aggregate Interest Rate | 2.80% |
Property And Equipment (Details) (USD $)
In Thousands, unless otherwise specified |
Mar. 31, 2012
|
Dec. 31, 2011
|
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 490,553 | $ 485,736 |
Less allowance for depreciation | (362,368) | (356,024) |
Property and Equipment, net | 128,185 | 129,712 |
Machinery and Equipment [Member]
|
||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 364,321 | 360,215 |
Land, Buildings and Improvements [Member]
|
||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 95,933 | 95,737 |
Furniture and Fixtures [Member]
|
||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 14,247 | 14,034 |
Leasehold Improvements [Member]
|
||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 16,052 | $ 15,750 |
Shareholders' Equity Transactions (Tables)
|
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2012
|
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | The following table summarizes information about stock option activity for the three months ended March 31, 2012:
|
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Schedule of Share-based Compensation, Stock Options Outstanding [Table Text Block] | The following table summarizes information about stock options outstanding at March 31, 2012:
|
Supplemental Guarantor Information Consolidating Condensed Statements of Operations (Details) (USD $)
|
3 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2012
|
Mar. 31, 2011
|
Mar. 31, 2012
The Company (Parent) [Member]
|
Mar. 31, 2011
The Company (Parent) [Member]
|
Mar. 31, 2012
Combined Guarantor Subsidiaries [Member]
|
Mar. 31, 2011
Combined Guarantor Subsidiaries [Member]
|
Mar. 31, 2012
Combined Non-Guarantor Subsidiaries [Member]
|
Mar. 31, 2011
Combined Non-Guarantor Subsidiaries [Member]
|
Mar. 31, 2012
Eliminations [Member]
|
Mar. 31, 2011
Eliminations [Member]
|
Mar. 31, 2012
Convertible Senior Subordinated Debentures February 2027 [Member]
Convertible Subordinated Debt [Member]
|
Feb. 17, 2007
Convertible Senior Subordinated Debentures February 2027 [Member]
Convertible Subordinated Debt [Member]
|
|
Condensed Financial Statements, Captions [Line Items] | ||||||||||||
Interest Rate | 4.125% | |||||||||||
Debt Instrument, Face Amount | $ 135,000,000 | |||||||||||
Net sales | 433,564,000 | 428,498,000 | 90,032,000 | 92,232,000 | 203,117,000 | 189,627,000 | 173,388,000 | 170,813,000 | (32,973,000) | (24,174,000) | ||
Cost of products sold | 313,995,000 | 305,492,000 | 67,952,000 | 66,338,000 | 159,397,000 | 149,050,000 | 119,415,000 | 114,362,000 | (32,769,000) | (24,258,000) | ||
Gross Profit | 119,569,000 | 123,006,000 | 22,080,000 | 25,894,000 | 43,720,000 | 40,577,000 | 53,973,000 | 56,451,000 | (204,000) | 84,000 | ||
Selling, general and administrative expense | 107,499,000 | 105,777,000 | 32,769,000 | 32,700,000 | 29,669,000 | 14,193,000 | 45,061,000 | 45,510,000 | 0 | 13,374,000 | ||
Loss on debt extinguishment including debt finance charges and associated fees | 0 | 4,881,000 | 4,881,000 | 0 | 0 | 0 | ||||||
Interest Expense, Net | 1,139,000 | 2,344,000 | (870,000) | 1,063,000 | 1,249,000 | 377,000 | 760,000 | 904,000 | 0 | 0 | ||
Income (loss) from equity investee | 0 | 0 | 18,246,000 | 20,824,000 | 1,044,000 | 4,335,000 | 199,000 | (21,000) | (19,489,000) | (25,138,000) | ||
Earnings (loss) before Income Taxes | 10,383,000 | 10,004,000 | 8,421,000 | 8,074,000 | 13,838,000 | 30,342,000 | 7,817,000 | 10,016,000 | (19,693,000) | (38,428,000) | ||
Income taxes (benefit) | 2,150,000 | 2,550,000 | 188,000 | 620,000 | 87,000 | 100,000 | 1,875,000 | 1,830,000 | 0 | 0 | ||
Net earnings (loss) | 8,233,000 | 7,454,000 | 8,233,000 | 7,454,000 | 13,751,000 | 30,242,000 | 5,942,000 | 8,186,000 | (19,693,000) | (38,428,000) | ||
Other Comprehensive Income (Loss), Net of Tax | 1,186,000 | 33,938,000 | 1,186,000 | 33,938,000 | 1,845,000 | 2,386,000 | (150,000) | 32,453,000 | (1,695,000) | (34,839,000) | ||
Comprehensive Income (Loss), Net of Tax, Attributable to Parent | 9,419,000 | 41,392,000 | 9,419,000 | 41,392,000 | 15,596,000 | 32,628,000 | 5,792,000 | 40,639,000 | (21,388,000) | (73,267,000) | ||
Restructuring Charges | $ 548,000 | $ 0 | $ 6,000 | $ 8,000 | $ 534,000 | $ 0 |
Other Long-Term Obligations (Details) (USD $)
In Thousands, unless otherwise specified |
Mar. 31, 2012
|
Dec. 31, 2011
|
---|---|---|
Other Liabilities, Noncurrent [Abstract] | ||
Total long-term obligations | $ 109,706 | $ 106,150 |
Charges Related To Restructuring Activities (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2012
|
Dec. 31, 2011
|
|
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | $ 5,232 | $ 0 |
Restructuring Charges including Inventory Markdowns | 548 | 10,870 |
Restructuring Reserve, Settled with Cash | (3,026) | (5,638) |
Restructuring Reserve, Ending Balance | 2,754 | 5,232 |
Severance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 5,158 | 0 |
Restructuring Charges including Inventory Markdowns | 514 | 8,688 |
Restructuring Reserve, Settled with Cash | (2,970) | (3,530) |
Restructuring Reserve, Ending Balance | 2,702 | 5,158 |
Product Line Discontinuance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | 0 |
Restructuring Charges including Inventory Markdowns | 0 | 277 |
Restructuring Reserve, Settled with Cash | 0 | (277) |
Restructuring Reserve, Ending Balance | 0 | 0 |
Contract Terminations [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 74 | 0 |
Restructuring Charges including Inventory Markdowns | 34 | 1,788 |
Restructuring Reserve, Settled with Cash | (56) | (1,714) |
Restructuring Reserve, Ending Balance | 52 | 74 |
Other [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | 0 |
Restructuring Charges including Inventory Markdowns | 0 | 117 |
Restructuring Reserve, Settled with Cash | 0 | (117) |
Restructuring Reserve, Ending Balance | 0 | 0 |
NA/HME [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 3,092 | |
Restructuring Charges including Inventory Markdowns | 117 | 4,760 |
Restructuring Reserve, Settled with Cash | (1,130) | (1,668) |
Restructuring Reserve, Ending Balance | 2,079 | 3,092 |
NA/HME [Member] | Severance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 3,092 | |
Restructuring Charges including Inventory Markdowns | 117 | 4,756 |
Restructuring Reserve, Settled with Cash | (1,130) | (1,664) |
Restructuring Reserve, Ending Balance | 2,079 | 3,092 |
NA/HME [Member] | Product Line Discontinuance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 0 |
Restructuring Reserve, Settled with Cash | 0 | 0 |
Restructuring Reserve, Ending Balance | 0 | 0 |
NA/HME [Member] | Contract Terminations [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 0 |
Restructuring Reserve, Settled with Cash | 0 | 0 |
Restructuring Reserve, Ending Balance | 0 | 0 |
NA/HME [Member] | Other [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 4 |
Restructuring Reserve, Settled with Cash | 0 | (4) |
Restructuring Reserve, Ending Balance | 0 | 0 |
IPG [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 71 | |
Restructuring Charges including Inventory Markdowns | 35 | 123 |
Restructuring Reserve, Settled with Cash | (82) | (52) |
Restructuring Reserve, Ending Balance | 24 | 71 |
IPG [Member] | Severance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 71 | |
Restructuring Charges including Inventory Markdowns | 35 | 123 |
Restructuring Reserve, Settled with Cash | (82) | (52) |
Restructuring Reserve, Ending Balance | 24 | 71 |
IPG [Member] | Product Line Discontinuance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 0 |
Restructuring Reserve, Settled with Cash | 0 | 0 |
Restructuring Reserve, Ending Balance | 0 | 0 |
IPG [Member] | Contract Terminations [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 0 |
Restructuring Reserve, Settled with Cash | 0 | 0 |
Restructuring Reserve, Ending Balance | 0 | 0 |
IPG [Member] | Other [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 0 |
Restructuring Reserve, Settled with Cash | 0 | 0 |
Restructuring Reserve, Ending Balance | 0 | 0 |
ISG [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 253 | |
Restructuring Charges including Inventory Markdowns | (13) | 335 |
Restructuring Reserve, Settled with Cash | (99) | (82) |
Restructuring Reserve, Ending Balance | 141 | 253 |
ISG [Member] | Severance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 253 | |
Restructuring Charges including Inventory Markdowns | (13) | 335 |
Restructuring Reserve, Settled with Cash | (99) | (82) |
Restructuring Reserve, Ending Balance | 141 | 253 |
ISG [Member] | Product Line Discontinuance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 0 |
Restructuring Reserve, Settled with Cash | 0 | 0 |
Restructuring Reserve, Ending Balance | 0 | 0 |
ISG [Member] | Contract Terminations [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 0 |
Restructuring Reserve, Settled with Cash | 0 | 0 |
Restructuring Reserve, Ending Balance | 0 | 0 |
ISG [Member] | Other [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 0 |
Restructuring Reserve, Settled with Cash | 0 | 0 |
Restructuring Reserve, Ending Balance | 0 | 0 |
Europe [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 1,816 | |
Restructuring Charges including Inventory Markdowns | 291 | 5,466 |
Restructuring Reserve, Settled with Cash | (1,597) | (3,650) |
Restructuring Reserve, Ending Balance | 510 | 1,816 |
Europe [Member] | Severance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 1,742 | |
Restructuring Charges including Inventory Markdowns | 257 | 3,288 |
Restructuring Reserve, Settled with Cash | (1,541) | (1,546) |
Restructuring Reserve, Ending Balance | 458 | 1,742 |
Europe [Member] | Product Line Discontinuance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 277 |
Restructuring Reserve, Settled with Cash | 0 | (277) |
Restructuring Reserve, Ending Balance | 0 | 0 |
Europe [Member] | Contract Terminations [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 74 | |
Restructuring Charges including Inventory Markdowns | 34 | 1,788 |
Restructuring Reserve, Settled with Cash | (56) | (1,714) |
Restructuring Reserve, Ending Balance | 52 | 74 |
Europe [Member] | Other [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 113 |
Restructuring Reserve, Settled with Cash | 0 | (113) |
Restructuring Reserve, Ending Balance | 0 | 0 |
Asia/Pacific [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 118 | 186 |
Restructuring Reserve, Settled with Cash | (118) | (186) |
Restructuring Reserve, Ending Balance | 0 | 0 |
Asia/Pacific [Member] | Severance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 118 | 186 |
Restructuring Reserve, Settled with Cash | (118) | (186) |
Restructuring Reserve, Ending Balance | 0 | 0 |
Asia/Pacific [Member] | Product Line Discontinuance [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 0 |
Restructuring Reserve, Settled with Cash | 0 | 0 |
Restructuring Reserve, Ending Balance | 0 | 0 |
Asia/Pacific [Member] | Contract Terminations [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 0 |
Restructuring Reserve, Settled with Cash | 0 | 0 |
Restructuring Reserve, Ending Balance | 0 | 0 |
Asia/Pacific [Member] | Other [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 0 | |
Restructuring Charges including Inventory Markdowns | 0 | 0 |
Restructuring Reserve, Settled with Cash | 0 | 0 |
Restructuring Reserve, Ending Balance | $ 0 | $ 0 |
Accounting Policies (Policies)
|
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2012
|
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Principles of Consolidation | Principles of Consolidation: The consolidated financial statements include the accounts of the company and its wholly owned subsidiaries and include all adjustments, which were of a normal recurring nature, necessary to present fairly the financial position of the company as of March 31, 2012, the results of its operations for the three months ended March 31, 2012 and changes in its cash flow for the three months ended March 31, 2012 and 2011, respectively. Certain foreign subsidiaries, represented by the European segment, are consolidated using a February 29 quarter end in order to meet filing deadlines. No material subsequent events have occurred related to the European segment, which would require disclosure or adjustment to the company's financial statements. All significant intercompany transactions are eliminated. The results of operations for the three months ended March 31, 2012 are not necessarily indicative of the results to be expected for the full year. |
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Use of Estimates | Use of Estimates: The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States, which require management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from these estimates. |
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Stock-Based Compensation | Stock-Based Compensation Plans: The company accounts for share-based compensation under the provisions of Compensation-Stock Compensation, ASC 718. The company has not made any modifications to the terms of any previously granted options and no significant changes have been made regarding the valuation methodologies used to determine the fair value of options granted and the company continues to use a Black-Scholes valuation model. The substantial majority of the options awarded have been granted at exercise prices equal to the market value of the underlying stock on the date of grant. Restricted stock awards granted without cost to the recipients are expensed on a straight-line basis over the vesting periods. The amounts of stock-based compensation expense recognized were as follows (in thousands):
The amounts above reflect compensation expense related to restricted stock awards and nonqualified stock options awarded under the 2003 Performance Plan (the “2003 Plan”). Stock-based compensation is not allocated to the business segments, but is reported as part of All Other as shown in the company's Business Segment Note to the Consolidated Financial Statements. |
Other Intangibles Finite-Lived Intangible Asset Future Amortization Expense (Details) (USD $)
|
3 Months Ended |
---|---|
Mar. 31, 2012
|
|
Finite-Lived Intangible Assets [Line Items] | |
Future Amortization Expense, Remainder of Fiscal Year | $ 9,985,000 |
Future Amortization Expense, Year One | 9,090,000 |
Future Amortization Expense, Year Two | 8,646,000 |
Future Amortization Expense, Year Three | 7,194,000 |
Future Amortization Expense, Year Four | 5,968,000 |
Future Amortization Expense, Year Five | $ 2,374,000 |
Receivables Rollforward of Allowance for Doubtful Accounts (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2012
|
Mar. 31, 2011
|
Mar. 31, 2012
Installment Receivables [Member]
|
Dec. 31, 2011
Installment Receivables [Member]
|
|
Allowance for Doubtful Accounts [Roll Forward] | ||||
Balance as of January 1 | $ 4,273 | $ 4,273 | $ 4,841 | |
Current period provision | 1,440 | 3,392 | 355 | 1,215 |
Direct write-offs charged against the allowance | (519) | (1,783) | ||
Balance as of December 31 | $ 4,109 | $ 4,109 | $ 4,273 |
Supplemental Guarantor Information Consolidating Condensed Statement of Cash Flows (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | |
---|---|---|
Mar. 31, 2012
|
Mar. 31, 2011
|
|
Condensed Financial Statements, Captions [Line Items] | ||
Net Cash Provided (Used) by Operating Activities | $ (825) | $ 8,943 |
Investing Activities | ||
Purchases of property and equipment | (4,681) | (3,353) |
Proceeds from sale of property and equipment | 45 | 14 |
Other long-term assets | (11) | (206) |
Other | 20 | (161) |
Net Cash Used for Investing Activities | (4,627) | (3,706) |
Financing Activities | ||
Proceeds from revolving lines of credit and long-term borrowings | 75,508 | 112,292 |
Payments on revolving lines of credit and long-term borrowings | (72,480) | (117,558) |
Proceeds from exercise of stock options | 0 | 2,068 |
Payment of financing costs | 0 | (4,507) |
Payment of dividends | (397) | (401) |
Purchase of treasury stock | 0 | (14,644) |
Net Cash Provided (Used) by Financing Activities | 2,631 | (22,750) |
Effect of exchange rate changes on cash | 565 | 1,683 |
Increase (decrease) in cash and cash equivalents | (2,256) | (15,830) |
Cash and cash equivalents at beginning of year | 34,924 | 48,462 |
Cash and cash equivalents at end of year | 32,668 | 32,632 |
The Company (Parent) [Member]
|
||
Condensed Financial Statements, Captions [Line Items] | ||
Net Cash Provided (Used) by Operating Activities | (483) | 31,725 |
Investing Activities | ||
Purchases of property and equipment | (553) | (817) |
Proceeds from sale of property and equipment | 12 | 0 |
Other long-term assets | 0 | (210) |
Other | 48 | 32 |
Net Cash Used for Investing Activities | (493) | (995) |
Financing Activities | ||
Proceeds from revolving lines of credit and long-term borrowings | 73,694 | 101,069 |
Payments on revolving lines of credit and long-term borrowings | (71,902) | (113,238) |
Proceeds from exercise of stock options | 2,068 | |
Payment of financing costs | (4,507) | |
Payment of dividends | (397) | (401) |
Purchase of treasury stock | (14,644) | |
Net Cash Provided (Used) by Financing Activities | 1,395 | (29,653) |
Effect of exchange rate changes on cash | 0 | 0 |
Increase (decrease) in cash and cash equivalents | 419 | 1,077 |
Cash and cash equivalents at beginning of year | 3,642 | 4,036 |
Cash and cash equivalents at end of year | 4,061 | 5,113 |
Combined Guarantor Subsidiaries [Member]
|
||
Condensed Financial Statements, Captions [Line Items] | ||
Net Cash Provided (Used) by Operating Activities | 1,074 | (342) |
Investing Activities | ||
Purchases of property and equipment | (2,546) | (813) |
Proceeds from sale of property and equipment | 17 | 0 |
Other long-term assets | 0 | 0 |
Other | 0 | (4) |
Net Cash Used for Investing Activities | (2,529) | (817) |
Financing Activities | ||
Proceeds from revolving lines of credit and long-term borrowings | 1,814 | 0 |
Payments on revolving lines of credit and long-term borrowings | 0 | 0 |
Proceeds from exercise of stock options | 0 | |
Payment of financing costs | 0 | |
Payment of dividends | 0 | 0 |
Purchase of treasury stock | 0 | |
Net Cash Provided (Used) by Financing Activities | 1,814 | 0 |
Effect of exchange rate changes on cash | 0 | 0 |
Increase (decrease) in cash and cash equivalents | 359 | (1,159) |
Cash and cash equivalents at beginning of year | 2,104 | 2,476 |
Cash and cash equivalents at end of year | 2,463 | 1,317 |
Combined Non-Guarantor Subsidiaries [Member]
|
||
Condensed Financial Statements, Captions [Line Items] | ||
Net Cash Provided (Used) by Operating Activities | (1,416) | (9,066) |
Investing Activities | ||
Purchases of property and equipment | (1,582) | (1,723) |
Proceeds from sale of property and equipment | 16 | 14 |
Other long-term assets | (11) | 4 |
Other | (28) | (189) |
Net Cash Used for Investing Activities | (1,605) | (1,894) |
Financing Activities | ||
Proceeds from revolving lines of credit and long-term borrowings | 0 | 11,223 |
Payments on revolving lines of credit and long-term borrowings | (578) | (4,320) |
Proceeds from exercise of stock options | 0 | |
Payment of financing costs | 0 | |
Payment of dividends | 0 | (13,374) |
Purchase of treasury stock | 0 | |
Net Cash Provided (Used) by Financing Activities | (578) | (6,471) |
Effect of exchange rate changes on cash | 565 | 1,683 |
Increase (decrease) in cash and cash equivalents | (3,034) | (15,748) |
Cash and cash equivalents at beginning of year | 29,178 | 41,950 |
Cash and cash equivalents at end of year | 26,144 | 26,202 |
Eliminations [Member]
|
||
Condensed Financial Statements, Captions [Line Items] | ||
Net Cash Provided (Used) by Operating Activities | 0 | (13,374) |
Investing Activities | ||
Purchases of property and equipment | 0 | 0 |
Proceeds from sale of property and equipment | 0 | 0 |
Other long-term assets | 0 | 0 |
Other | 0 | 0 |
Net Cash Used for Investing Activities | 0 | 0 |
Financing Activities | ||
Proceeds from revolving lines of credit and long-term borrowings | 0 | 0 |
Payments on revolving lines of credit and long-term borrowings | 0 | 0 |
Proceeds from exercise of stock options | 0 | |
Payment of financing costs | 0 | |
Payment of dividends | 0 | 13,374 |
Purchase of treasury stock | 0 | |
Net Cash Provided (Used) by Financing Activities | 0 | 13,374 |
Effect of exchange rate changes on cash | 0 | 0 |
Increase (decrease) in cash and cash equivalents | 0 | 0 |
Cash and cash equivalents at beginning of year | 0 | 0 |
Cash and cash equivalents at end of year | $ 0 | $ 0 |
Business Segments (Tables)
|
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Mar. 31, 2012
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Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment [Table Text Block] | The information by segment is as follows (in thousands):
________________________
|
Long-Term Debt (Details) (USD $)
In Thousands, unless otherwise specified |
Mar. 31, 2012
|
Dec. 31, 2011
|
---|---|---|
Debt Instrument [Line Items] | ||
Long-term Debt | $ 267,647 | $ 265,484 |
Long-term Debt, Current Maturities | (7,371) | 5,044 |
Long-term Debt, Excluding Current Maturities | 260,276 | 260,440 |
Line of Credit [Member] | Senior Secured Revolving Credit Facility October 2015 [Member]
|
||
Debt Instrument [Line Items] | ||
Long-term Debt | 249,438 | 247,063 |
Convertible Subordinated Debt [Member] | Convertible Senior Subordinated Debentures February 2027 [Member]
|
||
Debt Instrument [Line Items] | ||
Long-term Debt | 9,938 | 9,797 |
Notes Payable, Other Payables [Member] | Other Notes and Lease Obligations [Member]
|
||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 8,271 | $ 8,624 |
Derivatives Gain (Loss) in Statement of Finacial Position (Details) (USD $)
|
3 Months Ended | |
---|---|---|
Mar. 31, 2012
|
Mar. 31, 2011
|
|
Cash Flow Hedging [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in OCI on Derivatives (Effective Portion) | $ 120,000 | $ (1,378,000) |
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | 779,000 | 62,000 |
Amount of Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) | 0 | 6,000 |
Amount of Gain (Loss) Recognized in Income on Derivatives | (822,000) | 62,000 |
Sales [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative Instruments, Gain Recognized in Income | 258,000 | 213,000 |
Cost of Sales [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative Instruments, Gain Recognized in Income | 151,000 | |
Derivative Instruments, Loss Recognized in Income | (564,000) | |
Foreign Exchange Forward [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Income on Derivatives | 83,000 | 817,000 |
Foreign Exchange Forward [Member] | Cash Flow Hedging [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in OCI on Derivatives (Effective Portion) | 10,000 | (1,249,000) |
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | 779,000 | 62,000 |
Amount of Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) | 0 | 6,000 |
Foreign Exchange Forward [Member] | Selling General and Administrative Expense [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative Instruments, Gain Recognized in Income | 83,000 | 817,000 |
Interest Rate Swap [Member] | Cash Flow Hedging [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in OCI on Derivatives (Effective Portion) | 110,000 | (129,000) |
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | 0 | 0 |
Amount of Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) | 0 | 0 |
Interest Rate Swap [Member] | Interest Expense [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative Instruments, Loss Recognized in Income | $ (126,000) | $ (42,000) |
Income Taxes (Narrative) (Details)
|
3 Months Ended | |
---|---|---|
Mar. 31, 2012
|
Mar. 31, 2011
|
|
Note 11 - Income Taxes [Abstract] | ||
Effective Income Tax Rate, Continuing Operations | 20.70% | 25.50% |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate | 35.00% | 35.00% |
Acquisitions (Details) (USD $)
|
1 Months Ended | |
---|---|---|
Oct. 31, 2011
|
Sep. 30, 2011
Dynamic Medical Systems [Member]
|
|
Business Acquisition [Line Items] | ||
Cost of Acquired Entity | $ 41,465,000 | |
Contingent Consideration, Potential Cash Payment | 9,000,000 | |
Contingent Consideration Term | 24 months | |
Contingent Consideration, at Fair Value | 8,300,000 | |
Purchase Price Allocation, Assets Acquired | $ 965,000 |
Property And Equipment
|
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2012
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property And Equipment | Property and Equipment Property and equipment consist of the following (in thousands):
|
Net Earnings Per Common Share Computation of Basic and Diluted Net Earnings Per Common Share (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified |
3 Months Ended | |
---|---|---|
Mar. 31, 2012
|
Mar. 31, 2011
|
|
Basic | ||
Average common shares outstanding | 31,819 | 32,174 |
Net earnings (loss) | $ 8,233 | $ 7,454 |
Net earnings per common share | $ 0.26 | $ 0.23 |
Diluted | ||
Average common shares outstanding | 31,819 | 32,174 |
Shares related to convertible debt | 0 | 488 |
Stock options and awards | 3 | 353 |
Average common shares assuming dilution | 31,822 | 33,015 |
Net Earnings (loss) | $ 8,233 | $ 7,454 |
Net Earnings (loss) per Share - Assuming Dilution | $ 0.26 | $ 0.23 |