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EX-32.2 - EX-32.2 - GENTHERM Incthrm-ex322_201409307.htm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

(Mark One)

x

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

For the quarterly period ended September 30, 2014

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: 0-21810

 

GENTHERM INCORPORATED

(Exact name of registrant as specified in its charter)

 

 

Michigan

 

95-4318554

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

21680 Haggerty Road, Ste. 101, Northville, MI

 

48167

(Address of principal executive offices)

 

(Zip Code)

Registrant’s telephone number, including area code: (248) 504-0500

 

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§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  x    No  ¨

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

 

Large accelerated filer

¨

  

Accelerated filer

x

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  x

At November 7, 2014, the registrant had 35,701,556 shares of Common Stock, no par value, issued and outstanding.

 

 

 

 

 


 

GENTHERM INCORPORATED

TABLE OF CONTENTS

 

Cover

 

Table of Contents

 

 

 

Part I. Financial Information

  

3

 

 

Item 1.

 

 

Financial Statements (Unaudited)

 

3

 

 

 

 

Consolidated Condensed Balance Sheets

 

3

 

 

 

 

Consolidated Condensed Statements of Income

 

4

 

 

 

 

Consolidated Condensed Statements of Comprehensive Income

 

5

 

 

 

 

Consolidated Condensed Statements of Cash Flows

 

6

 

 

 

 

Consolidated Condensed Statement of Changes in Shareholders’ Equity

 

7

 

 

 

 

Notes to Unaudited Consolidated Condensed Financial Statements

 

8

 

Item 2.

 

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

19

 

Item 3.

 

 

Quantitative and Qualitative Disclosures About Market Risk

 

23

 

Item 4.

 

 

Controls and Procedures

 

26

 

Part II. Other Information

  

27

 

 

Item 1.

 

Legal Proceedings

 

27

 

 

Item 1A.

 

Risk Factors

 

27

 

 

Item 6.

 

Exhibits

 

27

 

Signatures

  

28

 

 

2


 

PART I. FINANCIAL INFORMATION

 

ITEM 1.

FINANCIAL STATEMENTS

GENTHERM INCORPORATED

CONSOLIDATED CONDENSED BALANCE SHEETS

(In thousands, except share data)

 

 

September 30,
2014

 

 

December 31,
2013

 

 

(unaudited)

 

 

 

 

ASSETS

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

 

Cash and cash equivalents

$

65,169

 

 

$

54,885

 

Accounts receivable, less allowance of $2,369 and $1,807, respectively

 

147,061

 

 

 

118,283

 

Inventory:

 

 

 

 

 

 

 

Raw materials

 

46,168

 

 

 

33,783

 

Work in process

 

4,322

 

 

 

2,864

 

Finished goods

 

24,293

 

 

 

27,570

 

Inventory, net

 

74,783

 

 

 

64,217

 

Derivative financial instruments

 

145

 

 

 

67

 

Deferred income tax assets

 

10,149

 

 

 

10,616

 

Prepaid expenses and other assets

 

31,372

 

 

 

21,864

 

Total current assets

 

328,679

 

 

 

269,932

 

Property and equipment, net

 

88,760

 

 

 

79,234

 

Goodwill

 

30,264

 

 

 

25,809

 

Other intangible assets

 

77,277

 

 

 

83,431

 

Deferred financing costs

 

1,054

 

 

 

1,072

 

Deferred income tax assets

 

19,341

 

 

 

7,103

 

Derivative financial instruments

 

1,158

 

 

 

1,969

 

Other non-current assets

 

11,140

 

 

 

13,373

 

Total assets

$

557,673

 

 

$

481,923

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

 

Accounts payable

$

73,638

 

 

$

61,662

 

Accrued liabilities

 

69,288

 

 

 

66,783

 

Current maturities of long-term debt

 

4,816

 

 

 

21,439

 

Derivative financial instruments

 

2,944

 

 

 

2,552

 

Deferred income tax liabilities

 

669

 

 

 

710

 

Total current liabilities

 

151,355

 

 

 

153,146

 

Pension benefit obligation

 

6,926

 

 

 

6,868

 

Other liabilities

 

3,419

 

 

 

1,601

 

Long-term debt, less current maturities

 

89,976

 

 

 

60,881

 

Derivative financial instruments

 

6,531

 

 

 

9,358

 

Deferred income tax liabilities

 

19,348

 

 

 

17,975

 

Total liabilities

 

277,555

 

 

 

249,829

 

Shareholders’ equity:

 

 

 

 

 

 

 

Common Stock:

 

 

 

 

 

 

 

No par value; 55,000,000 shares authorized, 35,641,556 and 34,929,334 issued and outstanding at September 30, 2014 and December 31, 2013, respectively

 

242,549

 

 

 

232,067

 

Paid-in capital

 

(6,329

)

 

 

(9,582

)

Accumulated other comprehensive loss

 

(21,204

)

 

 

(5,203

)

Accumulated earnings

 

65,102

 

 

 

14,812

 

Total shareholders’ equity

 

280,118

 

 

 

232,094

 

Total liabilities and shareholders’ equity

$

557,673

 

 

$

481,923

 

See accompanying notes to the consolidated condensed financial statements.

 

 

 

3


 

GENTHERM INCORPORATED

CONSOLIDATED CONDENSED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

2014

 

 

2013

 

 

2014

 

 

2013

 

Product revenues

$

206,012

 

 

$

171,182

 

 

$

606,132

 

 

$

479,792

 

Cost of sales

 

144,427

 

 

 

125,265

 

 

 

426,765

 

 

 

354,672

 

Gross margin

 

61,585

 

 

 

45,917

 

 

 

179,367

 

 

 

125,120

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net research and development expenses

 

15,278

 

 

 

12,718

 

 

 

42,873

 

 

 

36,962

 

Acquisition transaction expenses

 

 

 

 

326

 

 

 

1,075

 

 

 

1,911

 

Selling, general and administrative

 

22,307

 

 

 

18,319

 

 

 

62,368

 

 

 

53,483

 

Total operating expenses

 

37,585

 

 

 

31,363

 

 

 

106,316

 

 

 

92,356

 

Operating income

 

24,000

 

 

 

14,554

 

 

 

73,051

 

 

 

32,764

 

Interest expense

 

(857

)

 

 

(1,062

)

 

 

(2,758

)

 

 

(2,916

)

Debt retirement expense

 

(730

)

 

 

 

 

 

(730

)

 

 

 

Revaluation of derivatives

 

294

 

 

 

217

 

 

 

(293

)

 

 

1,201

 

Foreign currency gain(loss)

 

938

 

 

 

(1,612

)

 

 

(905

)

 

 

(1,514

)

Gain realized from step acquisition of subsidiary

 

 

 

 

 

 

 

785

 

 

 

 

Income from equity investment

 

 

 

 

77

 

 

 

 

 

 

319

 

Other income

 

495

 

 

 

191

 

 

 

796

 

 

 

691

 

Earnings before income tax

 

24,140

 

 

 

12,365

 

 

 

69,946

 

 

 

30,545

 

Income tax expense

 

6,852

 

 

 

3,600

 

 

 

19,656

 

 

 

6,343

 

Net income

 

17,288

 

 

 

8,765

 

 

 

50,290

 

 

 

24,202

 

Income attributable to non-controlling interest

 

 

 

 

(63

)

 

 

 

 

 

(1,340

)

Net income attributable to Gentherm Incorporated

 

17,288

 

 

 

8,702

 

 

 

50,290

 

 

 

22,862

 

Convertible preferred stock dividends

 

 

 

 

(159

)

 

 

 

 

 

(1,622

)

Net income attributable to common shareholders

$

17,288

 

 

$

8,543

 

 

$

50,290

 

 

$

21,240

 

Basic earnings per share

$

0.49

 

 

$

0.25

 

 

$

1.42

 

 

$

0.64

 

Diluted earnings per share

$

0.48

 

 

$

0.24

 

 

$

1.40

 

 

$

0.63

 

Weighted average number of shares – basic

 

35,522

 

 

 

34,447

 

 

 

35,317

 

 

 

33,261

 

Weighted average number of shares – diluted

 

36,271

 

 

 

34,886

 

 

 

35,943

 

 

 

33,584

 

See accompanying notes to the consolidated condensed financial statements.

 

 

 

4


 

GENTHERM INCORPORATED

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2014

 

 

2013

 

 

2014

 

 

2013

 

Net income

 

$

17,288

 

 

$

8,765

 

 

$

50,290

 

 

$

24,202

 

Other comprehensive income (loss), gross of tax:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

 

(13,178

)

 

 

8,642

 

 

 

(16,533

)

 

 

1,848

 

Unrealized gain on derivative securities

 

 

(529

)

 

 

30

 

 

 

(330

)

 

 

105

 

Other comprehensive income (loss), gross of tax

 

$

(13,707

)

 

$

8,672

 

 

$

(16,863

)

 

$

1,953

 

Other comprehensive income (loss), related tax effect:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

 

8

 

 

 

(88

)

 

 

862

 

 

 

(197

)

Other comprehensive income (loss), related tax effect

 

$

8

 

 

$

(88

)

 

$

862

 

 

$

(197

)

Other comprehensive income (loss), net of tax

 

$

(13,699

)

 

$

8,584

 

 

$

(16,001

)

 

$

1,756

 

Comprehensive income

 

 

3,589

 

 

 

17,349

 

 

 

34,289

 

 

 

25,958

 

Less: comprehensive income (loss) attributable to the non-controlling interest

 

 

 

 

 

(104

)

 

 

 

 

 

1,173

 

Comprehensive income attributable to Gentherm Incorporated

 

$

3,589

 

 

$

17,453

 

 

$

34,289

 

 

$

24,785

 

See accompanying notes to the consolidated condensed financial statements.

 

 

5


 

GENTHERM INCORPORATED

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

 

Nine Months Ended September 30,

 

 

2014

 

  

2013

 

Operating Activities:

 

 

 

 

 

 

 

Net income

$

50,290

 

 

$

24,202

 

Adjustments to reconcile net income to cash provided by operating activities:

 

 

 

 

 

 

 

Depreciation and amortization

 

24,565

 

 

 

23,467

 

Deferred tax provision

 

(6,294

)

 

 

(2,455

)

Stock compensation

 

3,449

 

 

 

1,861

 

Defined benefit plan income

 

(33

)

 

 

(159

)

Provision of doubtful accounts

 

500

 

 

 

369

 

Gain on revaluation of financial derivatives

 

(1,264

)

 

 

(2,859

)

Gain on equity investment

 

 

 

 

(318

)

Loss on sale of property and equipment

 

202

 

 

 

48

 

Unrealized foreign currency gain

 

(467

)

 

 

 

Gain realized from step acquisition of  subsidiary

 

(785

)

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Accounts receivable

 

(25,190

)

 

 

(19,606

)

Inventory

 

(4,000

)

 

 

(8,824

)

Prepaid expenses and other assets

 

(8,240

)

 

 

(2,458

)

Accounts payable

 

8,039

 

 

 

11,250

 

Accrued liabilities

 

4,679

 

 

 

4,099

 

Net cash provided by operating activities

 

45,451

 

 

 

28,617

 

Investing Activities:

 

 

 

 

 

 

 

Purchase of non-controlling interest

 

 

 

 

(46,835

)

Acquisition and investment in subsidiary, net of cash acquired

 

(31,739

)

 

 

 

Proceeds from the sale of property and equipment

 

96

 

 

 

7

 

Purchase of property and equipment

 

(26,990

)

 

 

(30,016

)

Cash invested in corporate owned life insurance

 

 

 

 

(266

)

Net cash used in investing activities

 

(58,633

)

 

 

(77,110

)

Financing Activities:

 

 

 

 

 

 

 

Borrowing of debt

 

91,592

 

 

 

  48,923

 

Repayments of debt

 

(76,904

)

 

 

(18,966

)

Distribution paid to non-controlling interests

 

 

 

 

  (3

)

Excess tax benefit from equity awards

 

4,004

 

 

 

1,317

 

Cash paid to Series C Preferred Stock Holders

 

 

 

 

(9,142

)

Proceeds from the exercise of common stock options

 

6,282

 

 

 

2,901

 

Net cash provided by financing activities

 

24,974

 

 

 

25,030

 

Foreign currency effect

 

(1,508

)

 

 

1,314

 

Net increase (decrease) in cash and cash equivalents

 

10,284

 

 

 

(22,149

)

Cash and cash equivalents at beginning of period

 

54,885

 

 

 

58,152

 

Cash and cash equivalents at end of period

$

65,169

 

 

$

36,003

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

 

Cash paid for taxes

$

13,181

 

 

$

7,174

 

Cash paid for interest

$

1,990

 

 

$

2,249

 

Supplemental disclosure of non-cash transactions:

 

 

 

 

 

 

 

Common stock issued to Board of Directors and employees

$

2,026

 

 

$

1,028

 

Issuance of common stock to non-controlling interest

$

 

 

$

42,517

 

Issuance of common stock for Series C Preferred Stock conversion

$

 

 

$

15,108

 

See accompanying notes to the consolidated condensed financial statements.

 

 

6


 

GENTHERM INCORPORATED

CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

(In thousands)

(Unaudited)

 

 

Common Stock

 

 

Paid-in
Capital

 

 

Accumulated
Earnings

 

 

Accumulated
Other
Comprehensive
Loss

 

 

Total

 

 

Shares

 

 

Amount

 

 

 

 

 

 

 

 

 

Balance at December 31, 2013

 

34,929

 

 

$

232,067

 

 

$

(9,582

)

 

$

14,812

 

 

$

(5,203

)

 

$

232,094

 

Exercise of Common Stock options for cash

 

650    

 

 

 

8,456

 

 

 

(2,174

)

 

 

 

 

 

 

 

 

6,282

 

Tax benefit from exercises of Common Stock options

 

 

 

 

 

 

 

4,004

 

 

 

 

 

 

 

 

 

4,004

 

Stock option compensation

 

 

 

 

 

 

 

1,423

 

 

 

 

 

 

 

 

 

1,423

 

Common Stock issued to Board of Directors and employees

 

62

 

 

 

2,026

 

 

 

 

 

 

 

 

 

 

 

 

2,026

 

Interest rate hedge, net

 

 

 

 

 

 

 

 

 

 

 

 

 

81

 

 

 

81

 

Foreign currency hedge, net

 

 

 

 

 

 

 

 

 

 

 

 

 

(411

)

 

 

(411

)

Currency translation, net

 

 

 

 

 

 

 

 

 

 

 

 

 

(15,671

)

 

 

(15,671

)

Net income

 

 

 

 

 

 

 

 

 

 

50,290

 

 

 

 

 

 

50,290

 

Balance at September 30, 2014

 

35,641

 

 

$

242,549

 

 

$

(6,329

)

 

$

65,102

 

 

$

(21,204

)

 

$

280,118

 

See accompanying notes to the consolidated condensed financial statements.

 

 

7


GENTHERM INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(In thousands, except share and per share data)

 

 

Note 1 – The Company and Subsequent Events

Gentherm Incorporated is a global technology and industry leader in the design, development, and manufacturing of innovative thermal management technologies.  Unless the context otherwise requires, the terms “Gentherm”, “Company”, “we”, “us” and “our” used herein refer to Gentherm Incorporated and its consolidated subsidiaries. We operate in locations aligned with our major customers’ product strategies in order to provide locally enhanced design, integration and production capabilities and to identify future climatic comfort product opportunities in both automotive and other markets.  We concentrate our research on the development of new technologies that will enable new products, improve overall effectiveness of existing products and maximize customer satisfaction.  We also focus on developing new design applications from our existing technologies to create new products and market opportunities for thermal comfort solutions.

Buyout of Joint Venture Partner

On February 12, 2014 we acquired all of the previously unowned shares in our North American electronics manufacturing joint venture which had previously been accounted for under the equity method.  The purchase was accounted for using the acquisition method and resulted in a gain of $785.

Gentherm Global Power Technologies

On April 1, 2014, we acquired all of the stock of privately-held Global Thermoelectric Inc., now known as Gentherm Global Power Technologies (“GPT”), in an all-cash transaction.  GPT is the global market leader and developer of thermoelectric generators.  GPT’s world headquarters and manufacturing operations are located in Alberta, Canada. See Note 3, “Gentherm Global Power Technologies” for additional information regarding GPT.

Subsequent Events

We have evaluated subsequent events through the date that our consolidated financial statements are issued. No events have taken place that meet the definition of a subsequent event requiring adjustments to or disclosures in this filing.  

 

Note 2 – Basis of Presentation and New Accounting Pronouncements

The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in the audited annual consolidated financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations.  In the opinion of management, all adjustments, consisting of normal recurring items, considered necessary for a fair presentation of our results of operations, financial position and cash flows have been included. The balance sheet as of December 31, 2013 was derived from audited annual consolidated financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. Operating results for the three and nine month periods ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. These consolidated condensed financial statements should be read in conjunction with the financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2013.

Revenue from Contracts with Customers

In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, “Revenue from Contracts with Customers.” ASU 2014-09 was developed to enable financial statement users to better understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers.  The update’s core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects  to be entitled in exchange for those goods or services.  Companies are to use a five-step contract review model to ensure revenue gets recognized, measured and disclosed in accordance with this principle.  

ASU 2014-09 is effective for fiscal years and interim periods beginning after December 15, 2016.  The amendments in this update should be applied retrospectively either to each prior reporting period presented or to disclose the cumulative effect recognized at the date of initial application.  Gentherm is developing a plan to complete the five-step contract review process for all existing contracts with customers.  We are still in the process of determining the impact the implementation of ASU 2014-09 will have on the Company’s financial statements.  

8


GENTHERM INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(In thousands, except share and per share data)

 

Note 2 – Basis of Presentation and New Accounting Pronouncements – Continued

Share-Based Payments

In June 2014, the FASB issued ASU 2014-12, “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 provides guidance on the treatment of awards containing performance targets that affect vesting and that could be achieved after an employee’s requisite service period.  The update states that these types of performance targets should be treated as performance conditions and, therefore, not reflected in estimating the fair value of awards at the grant date.  Compensation cost shall be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service period has been rendered.  Should the probability of achievement occur before the end of the requisite service period, the remaining unrecognized compensation cost shall be recognized prospectively over the remaining requisite service period.  The total compensation cost reflects the number of awards expected to vest and shall be adjusted to reflect when those awards ultimately vest.  

ASU 2014-12 is effective for fiscal years and interim periods beginning after December 15, 2015.   Gentherm has not assigned specific performance targets to share-based awards that are currently outstanding and therefore it is unlikely this update will materially impact the Company’s financial statements.  

Note 3 – Gentherm Global Power Technologies

GPT develops, manufactures and sells thermoelectric and non-thermoelectric power generation systems and related products.  The principal application for these technologies include natural gas well and pipeline protection systems and remote power generation for instrumentation, automation and telecommunication systems.  

Results of operations for GPT are included in the Company’s consolidated condensed financial statements beginning April 1, 2014.  GPT contributed $8,532 and $16,706 in product revenues and $639 and $597 in operating income for the three and nine month periods ended September 30, 2014, respectively.  

Purchase Price Allocation

The purchase price of approximately $31,102, net of cash acquired of $3,061, has been allocated to the values of assets acquired and liabilities assumed as of April 1, 2014.  The allocation of the purchase price is preliminary.  The Company is in the process of obtaining additional information required to finalize the valuation.  An appraisal will be completed to assist management in determining the fair value of acquired assets and assumed liabilities, including identifiable intangible assets.  The final purchase price allocation may be materially different than the preliminary allocation recorded.  The purchase price allocation is expected to be finalized by December 31, 2014.  The preliminary allocation as of April 1, 2014 was as follows:

 

 

 

 

 

 

Accounts receivable

 

$

10,200

 

Inventory

 

 

6,487

 

Deferred income tax assets, net

 

 

3,499

 

Order backlog

 

 

815

 

Prepaid expenses and other assets

 

 

258

 

Property and equipment

 

 

716

 

Customer relationships

 

 

5,524

 

Technology

 

 

2,807

 

Trade name

 

 

725

 

Goodwill

 

 

6,601

 

Assumed liabilities

 

 

(6,530

)

 

 

 

 

 

Net assets acquired

 

 

31,102

 

Cash acquired

 

 

3,061

 

 

 

 

 

 

Purchase price

 

$

34,163

 

9


GENTHERM INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(In thousands, except share and per share data)

 

Note 3 – Gentherm Global Power Technologies – Continued

Supplemental Pro Forma Information

The unaudited pro forma combined historical results for the amounts of GPT’s revenue and earnings that would have been included in the Company’s consolidated condensed statements of income had the acquisition date been July 1, 2013 for the three months ended September 30, 2013 period, January 1, 2014 for the nine months ended September 30, 2014 period or January 1, 2013 for the nine months ended September 30, 2013 period are as follows:

 

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

2013

 

 

2014

 

 

2013

 

Product revenues

 

$

176,272

 

 

$

619,143

 

 

$

501,307

 

Net income

 

 

6,735

 

 

 

52,168

 

 

 

19,742

 

The pro forma information includes adjustments for the effect of the amortization of intangible assets recognized in the acquisition.  This pro forma information is not necessarily indicative of future operating results.  

Goodwill

We recorded goodwill of approximately $6,601 arising from the acquisition. It is estimated that none of the goodwill recognized will be deductible for income tax purposes.  

 

Intangible Assets

In conjunction with the acquisition, intangible assets of $9,871 were recorded. The Company’s estimate of the fair value of these assets at the time of the acquisition is preliminary and will be determined with the assistance of an independent third-party valuation firm. As part of the estimated valuation, an estimated useful life for the assets was determined.

Intangible assets, net consisted of the following (balances are lower as of September 30, 2014 than as of April 1, 2014, the acquisition date, due to fluctuations in foreign currency exchange rates totaling $120):

 

 

 

September 30, 2014

 

  

Gross Value

  

 

Accumulated
Amortization

 

  

Net Value

  

  

Useful Life

Customer relationships

 

$

5,457

 

 

$

(230

)

 

$

5,227

 

 

12 yrs

Order backlog

 

 

805

 

 

 

(805

)

 

 

 

 

0.5 yrs

Technology

 

 

2,773

 

 

 

(140

)

 

 

2,633

 

 

10 yrs

Trade name

 

 

716

 

 

 

(103

)

 

 

613

 

 

3.5 yrs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

9,751

 

 

$

(1,278

)

 

$

8,473

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization expense of $667 and $1,316 for the three and nine months ended September 30, 2014 respectively, was recorded as follows:

 

 

 

 

Three Months Ended
September 30, 2014

 

 

Nine Months Ended
September 30, 2014

 

Product revenues

 

$

(119

)

 

$

(235

)

Selling, general and administrative expense

 

 

548

 

 

 

1,081

 

10


GENTHERM INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(In thousands, except share and per share data)

 

Note 3 – Gentherm Global Power Technologies – Continued

Amortization expense for the prospective five years is estimated to be as follows:

 

October 1, 2014 through December 31, 2014

 

$

234

 

2015

 

 

937

 

2016

 

 

937

 

2017

 

 

885

 

2018

 

 

732

 

Property & Equipment

Property and equipment consist of the following:

 

Asset Category

 

Useful Life

 

Amount

 

Land

 

Indefinite

 

$

15

 

Buildings

 

20 yrs

 

 

81

 

Leasehold improvements

 

5-7 yrs

 

 

28

 

Machinery and equipment

 

2-5 yrs

 

 

423

 

Computer hardware and software

 

3-5 yrs

 

 

169

 

 

 

 

 

 

 

 

 

 

 

 

$

716

 

 

 

 

 

 

 

 

 

Note 4 Earnings per Share

Basic earnings per common share are computed by dividing net income by the weighted average number of shares of stock outstanding during the period. The Company’s diluted earnings per share give effect to all potential common shares outstanding during a period that do not have an anti-dilutive impact to the calculation. In computing the diluted earnings per share, the treasury stock method is used in determining the number of shares assumed to be purchased from the conversion of Common Stock equivalents.

The following summarizes the common shares included in the basic and diluted shares, as disclosed on the face of the consolidated condensed statements of income:

 

 

Three Months
Ended September 30,

 

 

Nine Months
Ended September 30,

 

 

2014

 

 

2013

 

 

2014

 

 

2013

 

Weighted average number of shares for calculation of basic EPS – Common Stock

 

35,522,407

 

 

 

34,447,098

 

 

 

35,317,359

 

 

 

33,261,115

 

Stock option under the 2006, 2011 and 2013 Equity Incentive Plans

 

748,873

 

 

 

439,364

 

 

 

625,452

 

 

 

323,111

 

Weighted average number of shares for calculation of diluted EPS

 

36,271,280

 

 

 

34,886,462

 

 

 

35,942,811

 

 

 

33,584,226

 

 

The accompanying table represents Common Stock issuable upon the exercise of certain stock options that have been excluded from the diluted earnings calculation because the effect of their inclusion would be anti-dilutive.

 

 

Three Months
Ended September 30,

 

 

Nine Months
Ended September 30,

 

 

2014

 

 

2013

 

 

2014

 

 

2013

 

Stock options outstanding under the 2006, 2011 and 2013 Equity Incentive Plans

 

 

 

 

500,000

 

 

 

 

 

 

508,000

 

 

 

 

 

 

500,000

 

 

 

 

 

 

508,000

 

 

11


GENTHERM INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(In thousands, except share and per share data)

 

Note 5 – Segment Reporting

As part of the initiative to integrate the operations of historical Gentherm and W.E.T. Automotive Systems AG, now known as Gentherm GmbH (“Gentherm GmbH”), changes were made during the first quarter of 2014 to Gentherm’s structure of internal organization.  Gentherm no longer treats the operations of historical Gentherm and Gentherm GmbH as separate segments. The integration initiative also changed the scope of research and development activities which changed our reporting of segment information.

As discussed in Note 3 – Gentherm Global Power Technologies, Gentherm acquired GPT on April 1, 2014.  The acquisition enhances key elements of the Company’s business strategy by expanding the breadth of products derived from core thermal technologies as well as the markets in which they are applied.   The chief operating decision maker analyzes the operational results of GPT separate from the automotive segment.  The Company evaluated the significance of the GPT acquisition and determined it did not meet the thresholds to be presented in a separate and distinct segment.  The operating results of GPT and the advanced research and product development division, formally known as the Advanced Technology segment, are presented together as a reporting segment for the Company due to the high concentration of thermoelectric technologies and power generating programs being researched by Gentherm and due to technical synergies that exist between GPT and the advanced research and product development division.  The changes to the internal organization structure are reflected in the financial information used by our chief operating decision maker to allocate Company resources and assess operating performance.

Corporate reconciling items include certain selling, general and administrative costs previously reflected in the Gentherm GmbH segment.  

Management evaluates the performance of the Company’s segments based primarily on operating income or loss.

The Company’s reportable segments are as follows:

Automotive  – the aggregated operating results from Gentherm’s three geographic operating segments: North America, Europe and Asia.  

Industrial – the combined operating results of GPT and Gentherm’s advanced research and development division.  Advanced research and development includes efforts focused on improving the efficiency of thermoelectric devices and advanced heating wire technology as well as other applications. The segment includes government sponsored research projects, including those sponsored by the U.S. Department of Energy, the German Ministry of Economics and Technology and the European Union.  

Reconciling Items – include corporate selling, general and administrative costs and acquisition transaction costs. For the three and nine month periods ended September 30, 2014 and 2013, Gentherm allocated certain computer technology costs across all three reporting segments that had previously been reported in Reconciling Items.  The total amount of computer technology costs allocated to the Automotive and Industrial segments and previously reported in Reconciling items was $2,800 and $2,600 for the six month periods ended June 30, 2014 and 2013, respectively.    

12


GENTHERM INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(In thousands, except share and per share data)

 

Note 5 – Segment Reporting – Continued

The following table presents segment information about the reported product revenues, depreciation and amortization and operating income (loss) of the Company for the three and nine month periods ended September 30, 2014 and 2013. Information presented for 2013 has been restated to conform with our new segment reporting structure, including the allocation of computer technology costs across all segments.  With the exception of goodwill, asset information by segment is not reported since the Company does not manage assets at a segment level at this time. As of September 30, 2014, goodwill assigned to our Automotive and Industrial segments were $23,663 and $6,601, respectively. Goodwill as of December 31, 2013 pertained entirely to our Automotive segment. 

 

Three Months Ended September 30,

  

Automotive

 

  

Industrial

 

  

Reconciling
Items

 

 

Consolidated
Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2014:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Product revenues

 

$

197,480

 

 

$

8,532

 

 

$

 

 

$

206,012

 

Depreciation and amortization

 

 

7,062

 

 

 

700

 

 

 

872

 

 

 

8,634

 

Operating income (loss)

 

 

29,534

 

 

 

(1,832

)

 

 

(3,702

)

 

 

24,000

 

2013:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Product revenues

 

$

171,182

 

 

$

 

 

$

 

 

$

171,182

 

Depreciation and amortization

 

 

6,477

 

 

 

118

 

 

 

1,142

 

 

 

7,737

 

Operating income (loss)

 

 

20,428

 

 

 

(150

)

 

 

(5,724

)

 

 

14,554

 

 

Nine Months Ended September 30,

  

Automotive

 

  

Industrial

 

  

Reconciling
Items

 

 

Consolidated
Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2014:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Product revenues

 

$

589,426

 

 

$

16,706

 

 

$

 

 

$

606,132

 

Depreciation and amortization

 

 

20,790

 

 

 

1,650

 

 

 

2,125

 

 

 

24,565

 

Operating income (loss)

 

 

105,550

 

 

 

(5,689

)

 

 

(26,810

)

 

 

73,051

 

2013:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Product revenues

 

$

479,792

 

 

$

 

 

$

 

 

$

479,792

 

Depreciation and amortization

 

 

21,231

 

 

 

343

 

 

 

1,893

 

 

 

23,467

 

Operating income (loss)

 

 

64,114

 

 

 

(4,781

)

 

 

(26,569

)

 

 

32,764

 

Total product revenues information by geographic area is as follows:

 

 

Three Months Ended September 30,

 

 

2014

 

 

2013

 

United States

$

96,680

 

 

 

47

%

 

$

76,543

 

 

 

45

%

Germany

 

22,529

 

 

 

11

%

 

 

20,847

 

 

 

12

%

South Korea

 

21,339

 

 

 

10

%

 

 

13,546

 

 

 

8

%

China

 

17,557

 

 

 

9

%

 

 

18,285

 

 

 

11

%

Japan

 

11,970

 

 

 

6

%

 

 

10,281

 

 

 

6

%

Czech Republic

 

6,457

 

 

 

3

%

 

 

4,114

 

 

 

2

%

United Kingdom

 

5,363

 

 

 

3

%

 

 

5,180

 

 

 

3

%

Mexico

 

4,991

 

 

 

2

%

 

 

4,230

 

 

 

2

%

Canada

 

4,811

 

 

 

2

%

 

 

3,432

 

 

 

2

%

Other

 

14,315

 

 

 

7

%

 

 

14,724

 

 

 

9

%

         Total Non U.S.

 

109,332

 

 

 

53

%

 

 

94,639

 

 

 

55

%

 

$

206,012

 

 

 

100

%

 

$

171,182

 

 

 

100

%

13


GENTHERM INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(In thousands, except share and per share data)

 

Note 5 – Segment Reporting – Continued

 

 

Nine Months Ended September 30,

 

 

2014

 

 

2013

 

United States

$

270,597

 

 

 

45

%

 

$

211,462

 

 

 

44

%

Germany

 

70,491

 

 

 

12

%

 

 

61,332

 

 

 

13

%

South Korea

 

67,293

 

 

 

11

%

 

 

39,069

 

 

 

8

%

China

 

50,850

 

 

 

8

%

 

 

47,972

 

 

 

10

%

Japan

 

34,291

 

 

 

6

%

 

 

28,591

 

 

 

6

%

Czech Republic

 

19,398

 

 

 

3

%

 

 

11,893

 

 

 

3

%

United Kingdom

 

18,162

 

 

 

3

%

 

 

13,319

 

 

 

3

%

Mexico

 

14,752

 

 

 

2

%

 

 

11,696

 

 

 

2

%

Canada

 

12,542

 

 

 

2

%

 

 

10,533

 

 

 

2

%

Other

 

47,756

 

 

 

8

%

 

 

43,925

 

 

 

9

%

         Total Non U.S.

 

335,535

 

 

 

55

%

 

 

268,330

 

 

 

56

%

 

$

606,132

 

 

 

100

%

 

$

479,792

 

 

 

100

%

 

Note 6 – Debt

 

Credit Agreement

On August 7, 2014, the Company, together with certain direct and indirect subsidiaries, entered into a new Credit Agreement (the “Credit Agreement”) with a syndicate of banks led by Bank of America.  

The Credit Agreement provides for a $50,000 secured term loan facility for Gentherm (the “US Term Loan”), a €20,000 secured term loan facility for Gentherm GmbH (the “Europe Term Loan”), and a $100,000 secured revolving credit facility (with specific borrowing limits for foreign subsidiaries party to such agreement). The Credit Agreement allows the Company to increase the revolving credit facility or incur additional secured term loans in an aggregate amount of $50,000.  

All obligations under the Credit Agreement (including all the obligations of any US or non-US loan party) are unconditionally guaranteed by Gentherm and specified US subsidiaries.  Additionally, such parties entered into a pledge and security agreement, granting security interest in substantially all of their personal property to secure their respective obligations under the Credit Agreement, including the stock and membership interests of specified subsidiaries (limited to 66% of the stock in the case of certain non-US subsidiaries).  Further, specified foreign subsidiaries guarantee all obligations of the non-US loan parties under the Credit Agreement.

The following amounts were borrowed under the credit agreement:

 

 

 

 

 

 

 

 

 

Borrowing proceeds on August 7, 2014

 

Currency
Borrowed

 

 

US
Dollars

 

US Term Loan

 

$

50,000

  

 

$

50,000

  

US Revolving Note

 

C$

15,000

 

 

 

13,695

 

Europe Term Loan

 

20,000

 

 

 

26,730

 

On August 7, 2014, all amounts owed under the existing US Term Note, US Revolving Note, Europe Term Note and W.E.T. Term Note (collectively, the “Old Credit Agreements”) were repaid without penalty. The Old Credit Agreements and related security and pledge agreements were terminated as of such date.  Unamortized capitalized financing costs totaling $730 related to the Old Credit Agreements were expensed to debt retirement expense in the three months ended September 30, 2014.

The Company incurred expenses associated with the Credit Agreement which have been recorded as deferred financing costs and will be amortized over the life of the Credit Agreement using the effective interest method.  The US Term Loan, Europe Term Loan and US Revolving Note mature on August 7, 2019.

14


GENTHERM INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(In thousands, except share and per share data)

 

Note 6 – Debt – Continued

Under the Credit Agreement, U.S. Dollar denominated loans bear interest at either a base rate (“Base Rate Loans”) or Eurocurrency rate (“Eurocurrency Rate Loans”), plus a margin (“Applicable Rate”).  Base Rate Loans are equal to the highest of the Federal Funds Rate (0.07% at September 30, 2014) plus 0.50%, Bank of America’s prime rate (3.25% as of September 30, 2014), or a one month Eurocurrency rate plus 1.00%.  Eurocurrency Rate Loans denominated in US Dollars or European Euros (“Euros”) are equal to the London Interbank Offered Rate and the Canadian Dealer Offered Rate for Canadian Dollar denominations.  All loans denominated in a currency other than the US Dollar, including the Europe Term Loan, must be Eurocurrency Rate Loans.  Interest is payable at least quarterly.

The Applicable Rate from the initial period of August 7, 2014 through the fiscal quarter ending December 31, 2014 is 1.75% per annum for Eurocurrency Rate Loans and 0.75% for Base Rate Loans.  After the initial period, the Applicable Rate will vary based on the Consolidated Leverage Ratio of the Company, as defined by the Credit Agreement. As long as the Company is not in default of the terms and conditions of the Credit Agreement, the lowest and highest possible Applicable Rate is 1.50% and 2.00%, respectively, for Eurocurrency Rate Loans and 0.50% and 1.00%, respectively, for Base Rate Loans.   

The Company must maintain certain financial ratios consisting of a minimum Consolidated Fixed Charge Coverage Ratio and a maximum Consolidated Leverage Ratio as defined by the Credit Agreement.  

 

DEG Loan

The Company has a fixed interest rate loan with the German Investment Corporation, a subsidiary of KfW banking group, a German government-owned development bank (“DEG Loan”). The DEG Loan is subject to semi-annual principal payments beginning March, 2015 and ending September, 2019. Under the terms of the DEG Loan, the Company must maintain a minimum Debt-to-Equity Ratio, Current Ratio and Debt Service Coverage Ratio based on the financial statements of Gentherm’s wholly owned subsidiary, Gentherm Automotive Systems (China) Limited, as defined by the DEG Loan agreement.

 

Capital Lease

The Company has a capital lease agreement for an enterprise resource planning system.  Under the terms of the lease, the Company must maintain certain financial covenants.  Ownership of the system will be transferred to the Company at the end of the agreement.  

The following table summarizes the Company’s debt at September 30, 2014 and at December 31, 2013.

 

 

September 30, 2014

 

  

December 31,
2013

 

 

Interest
Rate

 

 

Principal
Balance

 

  

Principal
Balance

 

Credit Agreement:

 

 

 

 

 

 

 

 

 

 

 

      US Term Loan

 

1.98

%

 

$

50,000

 

 

$

 

      Europe Term Loan

 

1.81

%

 

 

25,267

 

 

 

 

      US Revolving Note

 

3.00

%

 

 

13,419

 

 

 

 

Prior Credit Agreements:

 

 

 

 

 

 

 

 

 

 

 

      US Term Note

 

 

 

 

 

 

 

 

24,500

 

      Europe Term Note

 

 

 

 

 

 

 

 

38,899

 

      W.E.T. Term Note

 

 

 

 

 

 

 

 

10,920

 

DEG Loan

 

4.25

%

 

 

5,053

 

 

 

5,561

 

Capital leases

 

4.20

%

 

 

1,053

 

 

 

2,440

 

Total debt

 

 

 

 

 

94,792

 

 

 

82,320

 

Current portion

 

 

 

 

 

(4,816

)

 

 

(21,439

)

Long-term debt, less current maturities

 

 

 

 

$

89,976

 

 

$

60,881

 

 

15


GENTHERM INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(In thousands, except share and per share data)

 

Note 6 – Debt – Continued

 

The scheduled principal maturities of our debt as of September 30, 2014 is as follows:

 

Year

 

US
Term
Loan

 

 

Europe
Term Loan

 

 

U.S.
Revolving
Note

 

 

DEG Loan

 

 

Capital
Leases

 

 

Total

  

2014

 

$

625

 

 

$

316

 

 

$

 

 

$

 

 

$

395

 

 

$

1,336

 

2015

 

 

2,500

 

 

 

1,263

 

 

 

 

 

 

1,011

 

 

 

658

 

 

 

5,432

 

2016

 

 

2,812

 

 

 

1,421

 

 

 

 

 

 

1,011

 

 

 

 

 

 

5,244

 

2017

 

 

3,750

 

 

 

1,895

 

 

 

 

 

 

1,011

 

 

 

 

 

 

6,656

 

2018

 

 

4,063

 

 

 

2,053

 

 

 

 

 

 

1,011

 

 

 

 

 

 

7,127

 

2019

 

 

36,250

 

 

 

18,319

 

 

 

13,419

 

 

 

1,009

 

 

 

 

 

 

68,997

 

Total

 

$

50,000

 

 

$

25,267

 

 

$

13,419

 

 

$

5,053

 

 

$

1,053

 

 

$

94,792

 

Principal outstanding under the US Term Loan, the Europe Term Loan and the US Revolving Note will be due and payable in full on August 7, 2019.  As of September 30, 2014, we were in compliance with all terms as outlined in the Credit Agreement, the DEG Loan and the capital lease agreement.

Note 7 – Derivative Financial Instruments

We are exposed to market risk from changes in foreign currency exchange rates and short term interest rates. Market risks for changes in interest rates relate primarily to our debt obligations under our Bank of America credit facilities. Foreign currency exchange risks are attributable to sales to foreign customers and purchases from foreign suppliers not denominated in the location’s functional currency, foreign plant operations and intercompany indebtedness, and include exposures to the Euro, Mexican Peso, Canadian Dollar, Hungarian Forint, Ukraine Hryvnia, Japanese Yen, Chinese Renminbi and Korean Won.

The Company regularly enters into derivative contracts with the objective of managing its financial and operational exposure arising from these risks by offsetting gains and losses on the underlying exposures with gains and losses on the financial instruments used to hedge them. We do not enter into derivative financial instruments for speculative or trading purposes. Our hedging relationships are formally documented at the inception of the hedge, and hedges must be highly effective in offsetting changes to future cash flows on hedged transactions both at the inception of a hedge and on an ongoing basis to be designated for hedge accounting treatment. We record the ineffective portion of hedging instruments, if any, to foreign currency gain (loss) in the consolidated condensed statements of income. Though we continuously monitor the hedging program, derivative positions and hedging strategies, foreign currency forward exchange agreements have not always been designated as hedging instruments for accounting purposes.

The Company uses a market approach to value derivative instruments, analyzing observable benchmark rates at commonly quoted intervals for the instrument’s full term.   For information about notional values and expected maturities of derivative instruments, see Part I, Item 3 “Quantitative and Qualitative Disclosures About Market Risk” included in this Report.

16


GENTHERM INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(In thousands, except share and per share data)

 

Note 7 – Derivative Financial Instruments – Continued

Information related to the recurring fair value measurement of derivative instruments in our consolidated condensed balance sheet as of September 30, 2014 is as follows:

 

 

 

 

 

 

 

Asset Derivatives

 

 

Liability Derivatives

 

 

Net Asset/
(Liabilities)

 

 

 

Hedge 
Designation

 

Fair Value
Hierarchy

 

Balance Sheet
Location

 

 

Fair
Value

 

 

Balance Sheet
Location

 

Fair
Value

 

 

 

 

CRS

 

Not a hedge

 

Level 2

 

 

 

 

 

 

 

 

 

Current liabilities

 

$

2,532

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-current 
liabilities

 

 

6,531

 

 

 

 

 

Total CRS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

9,063

 

 

$

(9,063

)

Foreign currency derivatives

 

Cash flow hedge

 

Level 2

 

 

 

 

 

 

 

 

 

Current liabilities

 

$

412

 

 

$

(412

)

Foreign currency derivatives

 

Not a hedge

 

Level 2

 

 

Current assets

 

 

$

145

 

 

 

 

 

 

 

 

$

145

 

 

 

 

 

 

 

 

Non-current 
assets

 

 

 

1,158

 

 

 

 

 

 

 

 

$

1,158

 

Total foreign currency derivatives

 

 

 

 

 

 

 

 

 

$

1,303

 

 

 

 

$

412

 

 

$

891

 

Information relating to the effect of derivative instruments on our consolidated condensed statements of income is as follows:

 

 

 

Location

 

Three Months
Ended
September 30,
2014

 

 

Nine Months
Ended
September 30,
2014

 

 

Three Months
Ended
September 30,
2013

 

 

Nine Months
Ended
September 30,
2013

 

Foreign currency derivatives

 

Revaluation of derivatives

 

$

557

 

 

398

 

 

 

581

 

 

(694

)

 

 

Product revenues

 

 

(129

)

 

(129

)

 

 

 

 

 

 

 

Cost of sales

 

 

64

 

 

94

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

(73

)

 

(141

)

 

 

 

 

 

 

 

Other comprehensive income

 

 

(571

)

 

(411

)

 

 

 

 

 

 

 

Foreign currency gain (loss)

 

 

(606

)

 

(1,054

)

 

 

(426

)

 

(844

)

Total foreign currency derivatives

 

 

 

$

(758

)

 

(1,243

)

 

$

155

 

 

 

(1,538

 

)

CRS

 

Revaluation of derivatives

 

$

(263

)

 

(690

)

 

$

(372

)

 

1,887

 

Interest rate derivatives

 

Revaluation of derivatives

 

$

 

 

(1

)

 

$

8

 

 

8

 

 

 

Other comprehensive income

 

 

42

 

 

81

 

 

 

30

 

 

105