10-Q 1 acw15-210q2.htm FORM 10-Q (SECOND QUARTER)  
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC  20549

FORM 10-Q

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

For the quarterly period ended June 30, 2015.

OR
 
Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
For the transition period from __________ to ___________.

Commission file number 001-32483


ACCURIDE CORPORATION
(Exact Name of Registrant as Specified in Its Charter)

Delaware
 
61-1109077
(State or Other Jurisdiction of Incorporation or Organization)
 
(I.R.S. Employer Identification No.)
 
 
 
7140 Office Circle, Evansville, IN
 
47715
(Address of Principal Executive Offices)
 
(Zip Code)
 
Registrant's Telephone Number, Including Area Code: (812) 962-5000
 
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 Data 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, or a smaller reporting company. See definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
 
Large Accelerated Filer
Accelerated Filer
Non-Accelerated Filer 
Smaller Reporting Company
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No
 
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.  Yes  No
 
As of July 23, 2015, 47,950,118 shares of Accuride Corporation common stock, par value $.01 per share, were outstanding.


ACCURIDE CORPORATION

Table of Contents

Page
 
 
 
 
 
 
 

Part I.  FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements (Unaudited)

ACCURIDE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In thousands, except for share and per share data)
 
June 30, 2015
   
December 31, 2014
 
ASSETS
 
   
 
CURRENT ASSETS:
 
   
 
Cash and cash equivalents
 
$
30,847
   
$
29,773
 
Customer receivables, net of allowance for doubtful accounts of $437 and $327 in 2015 and 2014, respectively
   
71,263
     
56,271
 
Other receivables
   
6,428
     
7,299
 
Inventories
   
40,724
     
43,065
 
Deferred income taxes
   
2,687
     
2,687
 
Prepaid expenses and other current assets
   
10,899
     
10,785
 
Total current assets
   
162,848
     
149,880
 
PROPERTY, PLANT AND EQUIPMENT, net
   
206,174
     
212,183
 
OTHER ASSETS:
               
Goodwill
   
100,697
     
100,697
 
Other intangible assets, net
   
113,884
     
117,963
 
Deferred financing costs, net of accumulated amortization of $5,791 and $5,077 in 2015 and 2014, respectively
   
4,313
     
5,012
 
Deferred income taxes
   
2,797
     
1,289
 
Pension asset
   
11,048
     
9,518
 
Other
   
1,939
     
1,880
 
TOTAL
 
$
603,700
   
$
598,422
 
LIABILITIES AND STOCKHOLDERS' EQUITY
               
CURRENT LIABILITIES:
               
Accounts payable
 
$
65,573
   
$
56,452
 
Accrued payroll and compensation
   
8,375
     
10,620
 
Accrued interest payable
   
12,462
     
12,428
 
Accrued workers compensation
   
2,961
     
3,137
 
Accrued and other liabilities
   
14,374
     
14,434
 
Total current liabilities
   
103,745
     
97,071
 
LONG-TERM DEBT
   
316,760
     
323,234
 
DEFERRED INCOME TAXES
   
16,704
     
14,837
 
NON-CURRENT INCOME TAXES PAYABLE
   
6,534
     
6,534
 
OTHER POSTRETIREMENT BENEFIT PLAN LIABILITY
   
63,092
     
82,157
 
PENSION BENEFIT PLAN LIABILITY
   
30,321
     
32,348
 
OTHER LIABILITIES
   
10,112
     
11,438
 
COMMITMENTS AND CONTINGENCIES (Note 6)
   
     
 
STOCKHOLDERS' EQUITY:
               
Preferred Stock, $0.01 par value; 10,000,000 shares authorized
   
     
 
Common Stock, $0.01 par value; 80,000,000 shares authorized, 47,950,118 and 47,718,818 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively, and additional paid-in-capital
   
443,669
     
442,631
 
Accumulated other comprehensive loss
   
(30,798
)
   
(49,638
)
Accumulated deficiency
   
(356,439
)
   
(362,190
)
Total stockholders' equity
   
56,432
     
30,803
 
TOTAL
 
$
603,700
   
$
598,422
 

See notes to unaudited condensed consolidated financial statements.
ACCURIDE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (UNAUDITED)

 
 
Three Months Ended June 30,
   
Six Months Ended June 30,
 
(In thousands except per share data)
 
2015
   
2014
   
2015
   
2014
 
 
 
   
   
   
 
NET SALES
 
$
185,380
   
$
181,575
   
$
369,039
   
$
348,359
 
COST OF GOODS SOLD
   
159,474
     
159,153
     
322,202
     
308,914
 
GROSS PROFIT
   
25,906
     
22,422
     
46,837
     
39,445
 
OPERATING EXPENSES:
                               
Selling, general and administrative
   
11,722
     
10,118
     
23,325
     
20,572
 
INCOME FROM OPERATIONS
   
14,184
     
12,304
     
23,512
     
18,873
 
OTHER INCOME (EXPENSE):
                               
Interest expense, net
   
(8,354
)
   
(8,487
)
   
(16,704
)
   
(16,907
)
Other loss, net
   
(84
)
   
(169
)
   
(1,256
)
   
(699
)
INCOME BEFORE INCOME TAXES FROM CONTINUING OPERATIONS
   
5,746
     
3,648
     
5,552
     
1,267
 
INCOME TAX (BENEFIT) EXPENSE
   
(378
)
   
(1,461
)
   
8
     
(557
)
INCOME FROM CONTINUING OPERATIONS
   
6,124
     
5,109
     
5,544
     
1,824
 
DISCONTINUED OPERATIONS, NET OF TAX
   
215
     
186
     
207
     
(102
)
NET INCOME
 
$
6,339
   
$
5,295
   
$
5,751
   
$
1,722
 
OTHER COMPREHENSIVE INCOME, NET OF TAX:
                               
Defined benefit plans
   
17,566
     
140
     
18,840
     
473
 
COMPREHENSIVE INCOME
 
$
23,905
   
$
5,435
   
$
24,591
   
$
2,195
 
Weighted average common shares outstanding—basic
   
47,991
     
47,737
     
47,907
     
47,667
 
Basic income per share-continuing operations
   
0.13
     
0.11
     
0.12
     
0.04
 
Basic income per share-discontinued operations
   
     
     
     
 
Basic income per share
 
$
0.13
   
$
0.11
   
$
0.12
   
$
0.04
 
Weighted average common shares outstanding—diluted
   
49,286
     
49,003
     
48,554
     
48,299
 
Diluted income per share-continuing operations
   
0.13
     
0.11
     
0.12
     
0.04
 
Diluted income per share-discontinued operations
   
     
     
     
 
Diluted income per share
 
$
0.13
   
$
0.11
   
$
0.12
   
$
0.04
 

See notes to unaudited condensed consolidated financial statements.

ACCURIDE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED)

(In thousands)
 
Common
Stock and
Additional
Paid-in-
Capital
   
Accumulated
Other
Comprehensive
Income (Loss)
   
Accumulated
Deficiency
   
Total
Stockholders'
Equity
 
                 
BALANCE April 1, 2014
 
$
440,725
   
$
(18,379
)
 
$
(363,456
)
 
$
58,890
 
Net income
   
     
     
5,295
     
5,295
 
Share-based compensation expense
   
710
     
     
     
710
 
Tax impact of forfeited vested shares
   
(51
)
   
     
     
(51
)
Other comprehensive income, net of tax
   
     
140
     
     
140
 
BALANCE—June 30, 2014
 
$
441,384
   
$
(18,239
)
 
$
(358,161
)
 
$
64,984
 
 
                               
BALANCE—April 1, 2015
 
$
442,931
   
$
(48,364
)
 
$
(362,778
)
 
$
31,789
 
Net income
   
     
     
6,339
     
6,339
 
Share-based compensation expense
   
786
     
     
     
786
 
Tax impact of forfeited vested shares
   
(48
)
   
     
     
(48
)
Other comprehensive income, net of tax
   
     
17,566
     
     
17,566
 
BALANCE—June 30, 2015
 
$
443,669
   
$
(30,798
)
 
$
(356,439
)
 
$
56,432
 

(In thousands)
 
Common
Stock and
Additional
Paid-in-
Capital
   
Accumulated
Other
Comprehensive
Income (Loss)
   
Accumulated
Deficiency
   
Total
Stockholders'
Equity
 
 
 
   
   
   
 
BALANCE— January 1, 2014
 
$
440,479
   
$
(18,712
)
 
$
(359,883
)
 
$
61,884
 
Net income
   
     
     
1,722
     
1,722
 
Share-based compensation expense
   
1,209
     
     
     
1,209
 
Tax impact of forfeited vested shares
   
(304
)
   
     
     
(304
)
Other comprehensive income, net of tax
   
     
473
     
     
473
 
BALANCE—June 30, 2014
 
$
441,384
   
$
(18,239
)
 
$
(358,161
)
 
$
64,984
 
 
                               
BALANCE—January 1, 2015
 
$
442,631
   
$
(49,638
)
 
$
(362,190
)
 
$
30,803
 
Net income
   
     
     
5,751
     
5,751
 
Share-based compensation expense
   
1,449
     
     
     
1,449
 
Tax impact of forfeited vested shares
   
(411
)
   
     
     
(411
)
Other comprehensive income, net of tax
   
     
18,840
     
     
18,840
 
BALANCE—June 30, 2015
 
$
443,669
   
$
(30,798
)
 
$
(356,439
)
 
$
56,432
 

See notes to unaudited condensed consolidated financial statements.

ACCURIDE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
 
 
 
Six Months Ended June 30,
 
(In thousands)
 
2015
   
2014
 
 
 
   
 
CASH FLOWS FROM OPERATING ACTIVITIES:
 
   
 
Net income
 
$
5,751
   
$
1,722
 
Adjustments to reconcile net income to net cash provided by operating activities:
               
Depreciation of property, plant and equipment
   
16,930
     
16,443
 
Amortization – deferred financing costs and debt discount
   
1,239
     
1,239
 
Amortization – other intangible assets
   
4,079
     
4,059
 
Loss on disposal of assets
   
98
     
406
 
Provision for deferred income taxes
   
(463
)
   
(15
)
Non-cash share-based compensation
   
1,449
     
1,209
 
Changes in certain assets and liabilities:
               
Receivables
   
(14,121
)
   
(21,651
)
Inventories
   
2,341
     
(6,887
)
Prepaid expenses and other assets
   
(1,642
)
   
(4,389
)
Accounts payable
   
7,346
     
16,098
 
Accrued and other liabilities
   
(4,387
)
   
(3,974
)
Net cash provided by operating activities
   
18,620
     
4,260
 
CASH FLOWS FROM INVESTING ACTIVITIES:
               
Purchases of property, plant and equipment
   
(9,244
)
   
(14,748
)
Proceeds from sale of property, plant, and equipment
   
     
1,235
 
Purchase of intangible asset
   
     
(671
)
Net cash used in investing activities
   
(9,244
)
   
(14,184
)
CASH FLOWS FROM FINANCING ACTIVITIES:
               
Proceeds from revolver
   
16,000
     
10,000
 
Payments on revolver
   
(23,000
)
   
 
Principal payments on capital leases
   
(1,288
)
   
(1,599
)
Other
   
(14
)
   
 
Net cash (used in) provided by financing activities
   
(8,302
)
   
8,401
 
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
   
1,074
     
(1,523
)
CASH AND CASH EQUIVALENTS—Beginning of period
   
29,773
     
33,426
 
CASH AND CASH EQUIVALENTS—End of period
 
$
30,847
   
$
31,903
 
 
               
Supplemental cash flow information:
               
Cash paid for interest
 
$
15,394
   
$
15,683
 
Cash paid for income taxes
 
$
1,629
   
$
1,137
 
Non-cash transactions:
               
Purchases of property, plant and equipment in accounts payable
 
$
4,168
   
$
3,388
 
 
See notes to unaudited condensed consolidated financial statements.

ACCURIDE CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(AMOUNTS IN THOUSANDS, UNLESS OTHERWISE NOTED, EXCEPT SHARE AND PER SHARE DATA)

Note 1 - Summary of Significant Accounting Policies

Basis of Presentation – The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"), except that the unaudited condensed consolidated financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.  However, in the opinion of Accuride Corporation ("Accuride" or the "Company"), all adjustments (consisting primarily of normal recurring accruals) considered necessary to present fairly the condensed consolidated financial statements have been included.  Certain operating results from prior periods have been reclassified to discontinued operations to conform to the current year presentation.

The results of operations for the three and six months ended June 30, 2015 are not necessarily indicative of the results to be expected for the year ending December 31, 2015.  The unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements and notes thereto disclosed in Accuride's Annual Report on Form 10-K for the year ended December 31, 2014.

Management's Estimates and Assumptions – The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Earnings Per Common Share – Basic and diluted earnings per common share were computed as follows:

 
 
Three Months Ended June 30,
   
Six Months Ended June 30,
 
(In thousands except per share data)
 
2015
   
2014
   
2015
   
2014
 
Numerator:
 
   
   
   
 
Net income from continuing operations
 
$
6,124
   
$
5,109
   
$
5,544
   
$
1,824
 
Net income (loss) from discontinued operations
   
215
     
186
     
207
     
(102
)
Net income
 
$
6,339
   
$
5,295
   
$
5,751
   
$
1,722
 
Denominator:
                               
Weighted average shares outstanding – Basic
   
47,991
     
47,737
     
47,907
     
47,667
 
Weighted average shares outstanding – Diluted
   
49,286
     
49,003
     
48,554
     
48,299
 
 
                               
Basic income per common share
                               
From continuing operations
 
$
0.13
   
$
0.11
   
$
0.12
   
$
0.04
 
From discontinued operations
   
     
     
     
 
Basic income per common share
 
$
0.13
   
$
0.11
   
$
0.12
   
$
0.04
 
 
                               
Diluted income per common share
                               
From continuing operations
 
$
0.13
   
$
0.11
   
$
0.12
   
$
0.04
 
From discontinued operations
   
     
     
     
 
Diluted income per common share
 
$
0.13
   
$
0.11
   
$
0.12
   
$
0.04
 

As of June 30, 2015, there were options exercisable for 144,095 shares that were not included in the computation of diluted earnings per share because the effect would be anti-dilutive.  As of June 30, 2014, there were options exercisable for 149,094 shares that were not included in the computation of diluted earnings per share because the effect would be anti-dilutive.


Share-Based Compensation  Compensation expense for share-based compensation programs recognized as a component of operating expenses was $0.8 million and $0.7 million for the three months ended June 30, 2015 and June 30, 2014, respectively. Compensation expense for share-based compensation programs recognized as a component of operating expenses was $1.4 million and $1.2 million for the six months ended June 30, 2015 and June 30, 2014, respectively.
 
As of June 30, 2015, there was approximately $5.0 million of unrecognized pre-tax compensation expense related to share-based awards not yet vested that will be recognized over a weighted-average period of 1.8 years.

Income Tax – Under Interim Financial Reporting, we compute on a quarterly basis an estimated annual effective tax rate considering ordinary income and related income tax (benefit) expense. Ordinary income refers to income (loss) before income tax expense excluding significant, unusual, or infrequently occurring items. The tax effect of an unusual or infrequently occurring item is recorded in the interim period in which it occurs. Other items included in income tax expense in the periods in which they occur include the cumulative effect of changes in tax laws or rates, foreign exchange gains and losses, adjustments to uncertain tax positions, and adjustments to our valuation allowance due to changes in judgment in the realizability of federal and state deferred tax assets in future years.
 
We have assessed the need to maintain a valuation allowance for deferred tax assets based on an assessment of whether it is more likely than not that deferred tax benefits will be realized through the generation of future taxable income. Appropriate consideration is given to all available evidence, both positive and negative, in assessing the need for a valuation allowance. Due to our recent history of U.S. operating and taxable losses, the inconsistency of income, and the uncertainty of our financial outlook, we continue to maintain a full valuation allowance against our domestic deferred tax assets. Deferred tax assets in our foreign jurisdictions are more likely than not to be recognized, therefore, no valuation allowance has been recorded for these assets.


Recent Accounting Pronouncements – On May 28, 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue From Contracts With Customers.  The amendments in this update create Topic 606, Revenue from Contracts with Customers, and supersede the revenue recognition requirements in Topic 605. The objective of the amendment is to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. GAAP and International Financial Reporting Standards ("IFRS"). The amendment is effective for annual reporting periods beginning after December 15, 2016, and interim periods therein. Early adoption is not permitted. The Company is evaluating the effect, if any, on its financial statements.

 On June 19, 2014, the FASB issued ASU 2014-12, Compensation-Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide that a Performance Target Could Be Achieved after the Requisite Service Period.  This update is intended to resolve the diverse accounting treatment of those awards in practice. The amendment is effective for annual and interim periods within those annual periods beginning after December 15, 2015. Early adoption is permitted. The Company is evaluating the effect, if any, on its financial statements.

On August 27, 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements-Going Concern. The amendments in this update provide guidance in U.S. GAAP about management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. In doing so, the amendments should reduce diversity in the timing and content of footnote disclosures. The amendments in this Update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company is evaluating the effect, if any, on its financial statements.

On January 9, 2015 , the FASB issued ASU 2015-01, Income Statement-Extraordinary and Unusual Items (Topic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items.  The update eliminates from GAAP the concept of extraordinary items. The amendment is effective for fiscal years beginning after December 15, 2015. Early adoption is permitted. The Company is evaluating the effect, if any, on its financial statements.

On February 18, 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis.  This update is intended to change the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The amendment is effective for annual and interim periods within those annual periods beginning after December 15, 2015. Early adoption is permitted. The Company is evaluating the effect, if any, on its financial statements.

On April 15, 2015, the FASB issued ASU 2015-05, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer's Accounting for Fees Paid in a Cloud Computing Arrangement.  The amendments in this update provide guidance to customers about whether a cloud computing arrangement includes a software license. The amendment is effective for annual and interim periods within those annual periods beginning after December 15, 2015. Early adoption is permitted. The Company is evaluating the effect, if any, on its financial statements.

On April 7, 2015, the FASB issued ASU 2015-03, Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. FASB is issuing this update as part of its initiative to reduce complexity in accounting standards (the Simplification Initiative).
To simplify presentation of debt issuance costs, the amendments in this update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this update. The amendments in this update are effective for annual and interim periods within those annual periods beginning after December 15, 2015. Early adoption is permitted. The Company is evaluating the effect, if any, on its financial statements.

 
Note 2 – Discontinued Operations

The Company has recognized certain operating results related to its Imperial Group business in Discontinued Operations.

The following table presents sales and income attributable to Discontinued Operations.

 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
(In thousands)
2015
 
2014
 
2015
 
2014
 
 
 
 
 
 
Net sales
 
$
   
$
   
$
   
$
 
 
                               
Loss from operations
   
(11
)
   
(10
)
   
(21
)
   
(21
)
Other income (expense)
   
226
     
196
     
228
     
(81
)
Discontinued Operations
 
$
215
   
$
186
   
$
207
   
$
(102
)

Note 3 - Inventories

Inventories at June 30, 2015 and December 31, 2014, on a first-in, first-out ("FIFO") basis, were as follows:

(In thousands)
 
June 30, 2015
   
December 31, 2014
 
Raw materials
 
$
7,844
   
$
8,244
 
Work in process
   
12,198
     
14,073
 
Finished manufactured goods
   
20,682
     
20,748
 
Total inventories
 
$
40,724
   
$
43,065
 

Note 4 - Goodwill and Other Intangible Assets

The following represents the carrying amount of goodwill, on a reportable segment basis:

(In thousands)
 
Wheels
   
Brillion Iron
Works
   
Total
 
Balance as of December 31, 2014
 
$
96,283
   
$
4,414
   
$
100,697
 
Balance as of June 30, 2015
 
$
96,283
   
$
4,414
   
$
100,697
 

The changes in the carrying amount of other intangible assets for the period December 31, 2014 to June 30, 2015, by reportable segment, are as follows:

(In thousands)
 
Wheels
   
Brillion Iron
Works
   
Total
 
Balance as of December 31, 2014
 
$
115,465
   
$
2,498
   
$
117,963
 
Amortization
   
(3,995
)
   
(84
)
   
(4,079
)
Balance as of June 30, 2015
 
$
111,470
   
$
2,414
   
$
113,884
 

The changes in the carrying amount of other intangible assets for the period December 31, 2013 to June 30, 2014, by reportable segment, are as follows:

(In thousands)
 
Wheels
   
Brillion Iron Works
   
Total
 
Balance as of December 31, 2013
 
$
122,764
   
$
2,666
   
$
125,430
 
Additions
   
671
     
     
671
 
Amortization
   
(3,975
)
   
(84
)
   
(4,059
)
Balance as of June 30, 2014
 
$
119,460
   
$
2,582
   
$
122,042
 


The summary of goodwill and other intangible assets is as follows:

 
 
   
As of June 30, 2015
   
As of December 31, 2014
 
(In thousands)
 
Weighted
Average
Useful
Lives
   
Gross Amount
   
Accumulated
Amortization
   
Carrying
Amount
   
Gross Amount
   
Accumulated
Amortization
   
Carrying
Amount
 
Goodwill
   
   
$
100,697
   
$
   
$
100,697
   
$
100,697
   
$
   
$
100,697
 
Other intangible assets:
                                                       
Trade names
   
   
$
25,200
   
$
   
$
25,200
   
$
25,200
   
$
   
$
25,200
 
Technology
   
10.6
     
39,169
     
24,671
     
14,498
     
39,169
     
23,158
     
16,011
 
Customer relationships
   
16.8
     
127,304
     
53,118
     
74,186
     
127,304
     
50,552
     
76,752
 
Other intangible assets
         
$
191,673
   
$
77,789
   
$
113,884
   
$
191,673
   
$
73,710
   
$
117,963
 

We estimate that our annual amortization expense for our other intangible assets for 2015 through 2019 will be approximately $8.2 million.

Note 5 - Pension and Other Postretirement Benefit Plans

Components of net periodic benefit cost for the three and six months ended June 30:

 
For the Three Months ended June 30,
 
For the Six Months ended June 30,
 
Pension Benefits
 
Other Benefits
 
Pension Benefits
 
Other Benefits
(In thousands)
2015
 
2014
 
2015
 
2014
 
2015
 
2014
 
2015
 
2014
Service cost-benefits earned during the period
$
179
 
$
270
 
$
101
 
$
87
 
$
356
 
$
534
 
$
204
 
$
172
Interest cost on projected benefit obligation
 
2,370
 
 
2,697
 
 
754
 
 
883
 
 
4,724
 
 
5,351
 
 
1,614
 
 
1,759
Expected return on plan assets
 
(2,785)
 
 
(3,213)
 
 
 
 
 
 
(5,557)
 
 
(6,368)
 
 
 
 
Amortization of prior service (credit) cost
 
11
 
 
11
 
 
(93)
 
 
(9)
 
 
22
 
 
22
 
 
(102)
 
 
(18)
Amortization of loss
 
320
 
 
51
 
 
94
 
 
80
 
 
631
 
 
101
 
 
195
 
 
157
Total benefit cost charged (credited) to income
$
95
 
$
(184)
 
$
856
 
$
1,041
 
$
176
 
$
(360)
 
$
1,911
 
$
2,070

As of June 30, 2015, $3.2 million has been contributed in 2015 to our sponsored pension plans.  We presently anticipate contributing an additional $4.5 million to fund our pension plans during 2015 for a total of $7.7 million.  

Certain of our post-retirement benefit programs were re-measured as of May 31, 2015 to reflect post-65 health benefits transitioning from a self-insured plan to a Medicare Advantage Plan. The transition to the Medicare Advantage plan will provide comparable benefits while taking advantage of certain government subsidies which help manage the continually rising costs of medical and prescription drug coverage.  The re-measurement resulted in a liability reduction of $17.9 million and corresponding gain in Accumulated Other Comprehensive Income.  This re-measurement takes into account the impact of the anticipated future program cost savings and current interest rate environments.

Note 6 – Commitments and Contingencies

We are from time to time involved in various legal proceedings of a character normally incidental to our business. We do not believe that the outcome of these proceedings will have a material adverse effect on our consolidated financial condition or results of our operations and cash flows.

In addition to environmental laws that regulate our ongoing operations, we are also subject to environmental remediation liability. Under the federal Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA") and analogous state laws, we may be subject to joint and several liability without regard to fault or the legality of the original conduct as a result of the release or threatened release of hazardous materials into the environment regardless of when the release occurred. We are currently involved in several matters relating to the investigation and/or remediation of locations where we have arranged for the disposal of foundry wastes. Such matters include situations in which we have been named or are believed to be potentially responsible parties in connection with the contamination of these offsite disposal locations. Additionally, environmental remediation may be required to address soil and groundwater contamination identified at certain of our facilities.

As of June 30, 2015, we had an environmental reserve of approximately $1.5 million, related primarily to our foundry operations. This reserve is based on management's review of potential liabilities as well as cost estimates related thereto. Any expenditure required for us to comply with applicable environmental laws and/or pay for any remediation efforts will not be reduced or otherwise affected by the existence of the environmental reserve. Our environmental reserve may not be adequate to cover our future costs related to the sites associated with the environmental reserve, and any additional costs may have a material adverse effect on our business, results of operations or financial condition. The discovery of additional environmental issues, the modification of existing laws or regulations or the promulgation of new ones, more vigorous enforcement by regulators, the imposition of joint and several liability under CERCLA or analogous state laws, or other unanticipated events could also result in a material adverse effect on our consolidated financial statements.


The Iron and Steel Foundry National Emission Standard for Hazardous Air Pollutants ("NESHAP") was developed pursuant to Section 112(d) of the Clean Air Act and requires major sources of hazardous air pollutants to achieve compliance with emission limits representative of maximum achievable control technology. Based on currently available information, we do not anticipate material costs regarding ongoing compliance with the NESHAP; however if we are found to be out of compliance with NESHAP, we could incur a liability that could have a material adverse effect on our consolidated financial statements.

Management does not believe that the outcome of any currently pending environmental proceeding will have a material adverse effect on our consolidated financial statements.

As of June 30, 2015, we had approximately 2,186 employees, of which 496 were salaried employees with the remainder paid hourly. Unions represent approximately 1,438 of our employees, which is approximately 66 percent of our total employees. Each of our unionized facilities has a separate contract with the union that represents the workers employed at such facility. The union contracts expire at various times over the next few years with the exception of our union contract that covers the hourly employees at our Monterrey, Mexico, facility, which expires on an annual basis in January unless otherwise renewed. The 2015 negotiations in Monterrey were completed prior to the expiration of our union contract. In 2014, we successfully negotiated new bargaining agreements for our Erie, Pennsylvania and Rockford, Illinois facilities, which will expire on September 3, 2018 and March 25, 2019, respectively. The previous contract at our London, Ontario facility expired on March 12, 2015, but our previously negotiated successor agreement  became effective on March 13, 2015 and runs through March 12, 2018. No other collective bargaining agreements expire in 2015.

Note 7 – Financial Instruments

We have determined the estimated fair value amounts of financial instruments using available market information and other appropriate valuation methodologies. However, considerable judgment is required in interpreting market data to develop the estimates of fair value.  A fair value hierarchy accounting standard exists for those instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and our own assumptions (unobservable inputs).  Determining which category an asset or liability falls within the hierarchy requires significant judgment.  We evaluate our hierarchy disclosures each quarter.

The hierarchy consists of three levels:

Level 1 Quoted market prices in active markets for identical assets or liabilities;
Level 2 Inputs other than Level 1 inputs that are either directly or indirectly observable; and
Level 3 Unobservable inputs developed using estimates and assumptions developed by us, which reflect those that a market participant would use.

The carrying amounts of cash and cash equivalents, customer receivables, and accounts payable approximate fair value because of the relatively short maturity of these instruments.  The fair value of our 9.5% senior secured notes based on market quotes, which we determined to be Level 1 inputs, at June 30, 2015 was approximately $319.2 million compared to the carrying amount of $306.8 million.  The fair value of our 9.5% senior secured notes based on market quotes, which we determined to be Level 1 inputs, at December 31, 2014 was approximately $319.2 million compared to the carrying amount of $306.2 million.  The Company believes the fair value of our variable interest rate Asset Based Loan ("ABL") facility at June 30, 2015 and December 31, 2014 equals the carrying value of $10.0 million and $17.0 million, respectively.  As of June 30, 2015 and December 31, 2014 we had no other financial instruments.


Note 8 – Segment Reporting

Based on our continual monitoring of the long-term economic characteristics, products and production processes, class of customer, and distribution methods of our operating segments, we have identified each of our operating segments below as reportable segments.  We believe this segmentation is appropriate based upon operating decisions and performance assessments by our President and Chief Executive Officer.  The accounting policies of the reportable segments are the same as described in Note 1, Summary of Significant Accounting Policies of our Annual Report on Form 10-K for the year ended December 31, 2014.

 
 
Three Months Ended June 30,
   
Six Months Ended June 30,
 
(In thousands)
 
2015
   
2014
   
2014
   
2014
 
Net sales:
 
   
   
   
 
Wheels
 
$
114,356
   
$
101,155
   
$
222,692
   
$
193,373
 
Gunite
   
47,006
     
48,304
     
84,746
     
92,277
 
Brillion Iron Works
   
24,018
     
32,116
     
61,601
     
62,709
 
Consolidated total
 
$
185,380
   
$
181,575
   
$
369,039
   
$
348,359
 
 
                               
Operating income (loss):
                               
Wheels
 
$
17,405
   
$
11,857
   
$
30,657
   
$
21,599
 
Gunite
   
7,338
     
7,243
     
10,079
     
10,521
 
Brillion Iron Works
   
(1,470
)
   
489
     
726
     
1,764
 
Corporate / Other
   
(9,089
)
   
(7,285
)
   
(17,950
)
   
(15,011
)
Consolidated total
 
$
14,184
   
$
12,304
   
$
23,512
   
$
18,873
 

Excluded from net sales above, are inter-segment sales from Brillion Iron Works to Gunite, as shown in the table below:

 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
(In thousands)
2015
 
2014
 
2015
 
2014
 
Inter-segment sales
 
$
1,733
   
$
3,929
   
$
3,908
   
$
7,770
 


 
As of
 
(In thousands)
June 30, 2015
 
December 31, 2014
 
Total assets:
 
 
Wheels
 
$
447,532
   
$
441,835
 
Gunite
   
62,553
     
59,600
 
Brillion Iron Works
   
52,155
     
55,226
 
Corporate / Other
   
41,460
     
41,761
 
Consolidated total
 
$
603,700
   
$
598,422
 

Note 9 - Debt

As of June 30, 2015, total debt was $316.8 million consisting of $306.8 million of our outstanding 9.5% senior secured notes, net of discount, and a $10.0 million draw on our ABL facility.  As of December 31, 2014, total debt was $323.2 million consisting of $306.2 million of our outstanding 9.5% senior secured notes, net of discount, and a $17.0 million draw on our ABL facility.
 
Our credit documents (the ABL Facility and the indenture governing the senior secured notes) contain operating covenants that limit the discretion of management with respect to certain business matters.  These covenants place significant restrictions on, among other things, the ability to incur additional debt, to pay dividends, to create liens, to make certain payments and investments and to sell or otherwise dispose of assets and merge or consolidate with other entities.  In addition, the ABL Facility contains a fixed charge coverage ratio covenant which will be applicable if the availability under the ABL Facility is less than 10.0% of the amount of the ABL Facility.  If applicable, that covenant requires us to maintain a minimum ratio of adjusted EBITDA less capital expenditures made during such period (other than capital expenditures financed with the net cash proceeds of asset sales, recovery events, incurrence of indebtedness and the sale or issuance of equity interests) to fixed charges of 1.00 to 1.00.  We are not currently in a compliance period, and we do not expect to be in a compliance period during the next twelve months.  However, we continue to operate in a challenging commercial environment and our ability to maintain liquidity and comply with our debt covenants may be affected by changes in economic or other conditions that are beyond our control and which are difficult to predict.

The ABL Facility provides for loans and letters of credit in an amount up to the aggregate availability under the facility, subject to meeting certain borrowing base conditions, with sub-limits of up to $10.0 million for swingline loans and $20.0 million for letters of credit.  Borrowings under the ABL Facility bear interest through maturity at a variable rate based upon, at our option, either LIBOR or the base rate (which is the greatest of one-half of 1.00% in excess of the federal funds rate, 1.00% in excess of the one-month LIBOR rate and the Agent's prime rate), plus, in each case, an applicable margin.  The applicable margin for loans under the first-in last-out term facility that are (i) LIBOR loans ranges, based on the our average excess availability, from 2.75% to 3.25% per annum and (ii) base rate loans ranges, based on our average excess availability, from 1.00% to 1.50%.  The applicable margin for other advances under the ABL Facility that are (i) LIBOR loans ranges, based on our average excess availability, from 1.75% to 2.25% and (ii) base rate loans ranges, based on our average excess availability, from 0.00% to 0.50%.

We must also pay an unused line fee equal to 0.25% per annum to the lenders under the ABL Facility if utilization under the facility is greater than or equal to 50.0% of the total available commitments under the facility, or an unused line fee equal to 0.375% per annum if utilization under the facility is less than 50.0% of the total available commitments under the facility. Customary letter of credit fees are also payable, as applicable.


Note 10 – Guarantor and Non-guarantor Financial Statements

Our senior secured notes are, jointly and severally, fully and unconditionally guaranteed, on a senior basis, by all of our existing and future 100% owned domestic subsidiaries ("Guarantor Subsidiaries"). The non-guarantor subsidiaries are our foreign subsidiaries and discontinued operations.  The following condensed financial information illustrates the composition of the combined Guarantor Subsidiaries:

CONDENSED CONSOLIDATING BALANCE SHEETS

 
 
June 30, 2015
 
(In thousands)
 
Parent
   
Guarantor Subsidiaries
   
Non-guarantor Subsidiaries
   
Eliminations
   
Total
 
ASSETS
 
   
   
   
   
 
Cash and cash equivalents
 
$
21,713
   
$
   
$
9,134
   
$
   
$
30,847
 
Customer and other receivables, net
   
51,354
     
20,783
     
5,554
     
     
77,691
 
Intercompany receivable
   
     
32,364
     
86,585
     
(118,949
)
   
 
Inventories
   
20,373
     
17,397
     
3,362
     
(408
)
   
40,724
 
Other current assets
   
6,774
     
2,037
     
4,775
     
     
13,586
 
Total current assets
   
100,214
     
72,581
     
109,410
     
(119,357
)
   
162,848
 
Property, plant and equipment, net
   
78,031
     
97,703
     
30,440
     
     
206,174
 
Goodwill
   
96,283
     
4,414
     
     
     
100,697
 
Other intangible assets, net
   
111,470
     
2,414
     
     
     
113,884
 
Investments in and advances to subsidiaries and affiliates
   
165,788
     
     
     
(165,788
)
   
 
Deferred income taxes
   
     
35,640
     
4,819
     
(37,662
)
   
2,797
 
Other non-current assets
   
5,907
     
345
     
11,048
     
     
17,300
 
TOTAL
 
$
557,693
   
$
213,097
   
$
155,717
   
$
(322,807
)
 
$
603,700
 
LIABILITIES AND STOCKHOLDERS' EQUITY
                                       
Accounts payable
 
$
17,395
   
$
36,894
   
$
11,284
   
$
   
$
65,573
 
Intercompany payable
   
87,645
     
     
31,712
     
(119,357
)
   
 
Accrued payroll and compensation
   
1,278
     
6,011
     
1,086
     
     
8,375
 
Accrued interest payable
   
12,462
     
     
     
     
12,462
 
Accrued and other liabilities
   
4,309
     
9,956
     
3,070
     
     
17,335
 
Total current liabilities
   
123,089
     
52,861
     
47,152
     
(119,357
)
   
103,745
 
Long term debt
   
316,760
     
     
     
     
316,760
 
Deferred and non-current income taxes
   
47,326
     
10,615
     
2,959
     
(37,662
)
   
23,238
 
Other non-current liabilities
   
14,086
     
71,875
     
17,564
     
     
103,525
 
Stockholders' equity
   
56,432
     
77,746
     
88,042
     
(165,788
)
   
56,432
 
TOTAL
 
$
557,693
   
$
213,097
   
$
155,717
   
$
(322,807
)
 
$
603,700
 

 
 
December 31, 2014
 
(In thousands)
 
Parent
   
Guarantor Subsidiaries
   
Non-guarantor Subsidiaries
   
Eliminations
   
Total
 
ASSETS
 
   
   
   
   
 
Cash and cash equivalents
 
$
22,710
   
$
   
$
7,063
   
$
   
$
29,773
 
Customer and other receivables, net
   
35,630
     
20,994
     
6,543
     
403
     
63,570
 
Intercompany receivables
   
191,272
     
5,086
     
53,055
     
(249,413
)
   
 
Inventories
   
18,693
     
21,352
     
3,423
     
(403
)
   
43,065
 
Other current assets
   
4,970
     
3,386
     
5,116
     
     
13,472
 
Total current assets
   
273,275
     
50,818
     
75,200
     
(249,413
)
   
149,880
 
Property, plant and equipment, net
   
78,603
     
101,648
     
31,932
     
     
212,183
 
Goodwill
   
96,283
     
4,414
     
     
     
100,697
 
Other intangible assets, net
   
115,465
     
2,498
     
     
     
117,963
 
Investments in and advances to subsidiaries and affiliates
   
128,372
     
     
     
(128,372
)
   
 
Other non-current assets
   
3,118
     
3,774
     
10,807
     
     
17,699
 
TOTAL
 
$
695,116
   
$
163,152
   
$
117,939
   
$
(377,785
)
 
$
598,422
 
LIABILITIES AND STOCKHOLDERS' EQUITY
                                       
Accounts payable
 
$
15,209
   
$
31,931
   
$
9,312
   
$
   
$
$56,452
 
Intercompany payable
   
249,407
     
     
6
     
(249,413
)
   
 
Accrued payroll and compensation
   
4,002
     
5,458
     
1,160
     
     
10,620
 
Accrued interest payable
   
12,428
     
     
     
     
12,428
 
Accrued and other liabilities
   
4,183
     
10,060
     
3,328
     
     
17,571
 
Total current liabilities
   
285,229
     
47,449
     
13,806
     
(249,413
)
   
97,071
 
Long term debt
   
323,234
     
     
     
     
323,234
 
Deferred and non-current income taxes
   
41,775
     
(20,736
)
   
332
     
     
21,371
 
Other non-current liabilities
   
14,075
     
93,245
     
18,623
     
     
125,943
 
Stockholders' equity
   
30,803
     
43,194
     
85,178
     
(128,372
)
   
30,803
 
TOTAL
 
$
695,116
   
$
163,152
   
$
117,939
   
$
(377,785
)
 
$
598,422
 

 
 
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

 
 
Three Months Ended June 30, 2015
 
(In thousands)
 
Parent
   
Guarantor
Subsidiaries
   
Non-guarantor
Subsidiaries
   
Eliminations
   
Total
 
Net sales
 
$
135,630
   
$
78,921
   
$
32,116
   
$
(61,287
)
 
$
185,380
 
Cost of goods sold
   
123,642
     
67,974
     
28,737
     
(60,879
)
   
159,474
 
Gross profit
   
11,988
     
10,947
     
3,379
     
(408
)
   
25,906
 
Operating expenses
   
11,434
     
250
     
38
     
     
11,722
 
Income (loss) from operations
   
554
     
10,697
     
3,341
     
(408
)
   
14,184
 
Other income (expense):
                                       
Interest income (expense), net
   
(8,754
)
   
(51
)
   
451
     
     
(8,354
)
Equity in earnings of subsidiaries
   
14,299
     
     
     
(14,299
)
   
 
Other income (expense), net
   
290
     
     
(374
)
   
     
(84
)
Income (loss) before income taxes from continuing operations
   
6,389
     
10,646
     
3,418
     
(14,707
)
   
5,746
 
Income tax (benefit) provision
   
50
     
(490
)
   
62
     
     
(378
)
Income (loss) from continuing operations
   
6,339
     
11,136
     
3,356
     
(14,707
)
   
6,124
 
Discontinued operations, net of tax
   
     
     
215
     
     
215
 
Net income (loss)
 
$
6,339
   
$
11,136
   
$
3,571
   
$
(14,707
)
 
$
6,339
 
 
                                       
Comprehensive income (loss)
 
$
23,905
   
$
28,034
   
$
3,727
   
$
(31,761
)
 
$
23,905
 
 
 
 
Three Months Ended June 30, 2014
 
(In thousands)
 
Parent
   
Guarantor
Subsidiaries
   
Non-guarantor
Subsidiaries
   
Eliminations
   
Total
 
Net sales
 
$
123,044
   
$
76,532
   
$
33,669
   
$
(51,670
)
 
$
181,575
 
Cost of goods sold
   
108,284
     
69,982
     
32,065
     
(51,178
)
   
159,153
 
Gross profit
   
14,760
     
6,550
     
1,604
     
(492
)
   
22,422
 
Operating expenses
   
9,843
     
222
     
53
     
     
10,118
 
Income (loss) from operations
   
4,917
     
6,328
     
1,551
     
(492
)
   
12,304
 
Other income (expense):
                                       
Interest income (expense), net
   
(8,766
)
   
(59
)
   
338
     
     
(8,487
)
Equity in earnings of subsidiaries
   
8,388
     
     
     
(8,388
)
   
 
Other income (expense), net
   
(800
)
   
63
     
568
     
     
(169
)
Income (loss) before income taxes from continuing operations
   
3,739
     
6,332
     
2,457
     
(8,880
)
   
3,648
 
Income tax (benefit) provision
   
(1,556
)
   
     
95
     
     
(1,461
)
Income (loss) from continuing operations
   
5,295
     
6,332
     
2,362
     
(8,880
)
   
5,109
 
Discontinued operations, net of tax
   
     
     
186
     
     
186
 
Net income (loss)
 
$
5,295
   
$
6,332
   
$
2,548
   
$
(8,880
)
 
$
5,295
 
 
                                       
Comprehensive income (loss)
 
$
5,435
   
$
6,322
   
$
2,687
   
$
(9,009
)
 
$
5,435
 


 
 
Six Months Ended June 30, 2015
 
(In thousands)
 
Parent
   
Guarantor
Subsidiaries
   
Non-guarantor
Subsidiaries
   
Eliminations
   
Total
 
Net sales
 
$
255,129
   
$
168,164
   
$
63,886
   
$
(118,140
)
 
$
369,039
 
Cost of goods sold
   
230,878
     
149,991
     
58,764
     
(117,431
)
   
322,202
 
Gross profit
   
24,251
     
18,173
     
5,122
     
(709
)
   
46,837
 
Operating expenses
   
22,737
     
504
     
84
     
     
23,325
 
Income (loss) from operations
   
1,514
     
17,669
     
5,038
     
(709
)
   
23,512
 
Other income (expense):
                                       
Interest income (expense), net
   
(17,442
)
   
(105
)
   
843
     
     
(16,704
)
Equity in earnings of subsidiaries
   
21,912
     
     
     
(21,912
)
   
 
Other income (expense), net
   
(279
)
   
     
(977
)
   
     
(1,256
)
Income (loss) before income taxes from continuing operations
   
5,705
     
17,564
     
4,904
     
(22,621
)
   
5,552
 
Income tax (benefit) provision
   
(46
)
   
(347
)
   
401
     
     
8
 
Income (loss) from continuing operations
   
5,751
     
17,911
     
4,503
     
(22,621
)
   
5,544
 
Discontinued operations, net of tax
   
     
     
207
     
     
207
 
Net income (loss)
 
$
5,751
   
$
17,911
   
$
4,710
   
$
(22,621
)
 
$
5,751
 
 
                                       
Comprehensive income (loss)
 
$
24,591
   
$
34,899
   
$
6,028
   
$
(40,927
)
 
$
24,591
 
 
 
 
Six Months Ended June 30, 2014
 
(In thousands)
 
Parent
   
Guarantor
Subsidiaries
   
Non-guarantor
Subsidiaries
   
Eliminations
   
Total
 
Net sales
 
$
231,575
   
$
150,834
   
$
66,323
   
$
(100,373
)
 
$
348,359
 
Cost of goods sold
   
207,166
     
139,686
     
61,504
     
(99,442
)
   
308,914
 
Gross profit
   
24,409
     
11,148
     
4,819
     
(931
)
   
39,445
 
Operating expenses
   
19,965
     
502
     
105
     
     
20,572
 
Income (loss) from operations
   
4,444
     
10,646
     
4,714
     
(931
)
   
18,873
 
Other income (expense):
                                       
Interest income (expense), net
   
(17,423
)
   
(120
)
   
636
     
     
(16,907
)
Equity in earnings of subsidiaries
   
14,061
     
     
     
(14,061
)
   
 
Other income (expense), net
   
(877
)
   
126
     
52
     
     
(699
)
Income (loss) before income taxes from continuing operations
   
205
     
10,652
     
5,402
     
(14,992
)
   
1,267
 
Income tax (benefit) provision
   
(1,517
)
   
143
     
817
     
     
(557
)
Income (loss) from continuing operations
   
1,722
     
10,509
     
4,585
     
(14,992
)
   
1,824
 
Discontinued operations, net of tax
   
     
     
(102
)
   
     
(102
)
Net income (loss)
 
$
1,722
   
$
10,509
   
$
4,483
   
$
(14,992
)
 
$
1,722
 
 
                                       
Comprehensive income (loss)
 
$
2,195
   
$
10,486
   
$
4,957
   
$
(15,443
)
 
$
2,195
 


CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

 
 
Six Months Ended June 30, 2015
 
(In thousands)
 
Parent
Company
   
Guarantor
Subsidiaries
   
Non-guarantor
Subsidiaries
   
Eliminations
   
Total
 
CASH FLOWS FROM OPERATING ACTIVITIES:
 
   
   
   
   
 
Net income (loss)
 
$
5,751
   
$
17,911
   
$
4,710
   
$
(22,621
)
 
$
5,751
 
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
                                       
Depreciation
   
5,558
     
9,418
     
1,954
     
     
16,930
 
Amortization – deferred financing costs
   
1,239
     
     
     
     
1,239
 
Amortization – other intangible assets
   
3,995
     
84
     
     
     
4,079
 
Loss on disposal of assets
   
123
     
37
     
(62
)
   
     
98
 
Deferred income taxes
   
27
     
(490
)
   
     
     
(463
)
Non-cash stock-based compensation
   
1,449
     
     
     
     
1,449
 
Equity in earnings of subsidiaries and affiliates
   
(21,912
)
   
     
     
21,912
     
 
Change in other operating items
   
18,869
     
(29,152
)
   
(889
)
   
709
     
(10,463
)
Net cash provided by (used in) operating activities
   
15,099
     
(2,192
)
   
5,713
     
     
18,620
 
 
                                       
CASH FLOWS FROM INVESTING ACTIVITIES:
                                       
Purchases of property, plant, and equipment
   
(4,776
)
   
(3,990
)