2018 Q1 Form 10-Q Financial Statement

#000162828018005573 Filed on May 02, 2018

View on sec.gov

Income Statement

Concept 2018 Q1 2017 Q1
Revenue $437.0M $437.5M
YoY Change -0.13% 0.07%
Cost Of Revenue $392.4M $387.1M
YoY Change 1.39% 4.99%
Gross Profit $44.52M $50.47M
YoY Change -11.78% -26.39%
Gross Profit Margin 10.19% 11.53%
Selling, General & Admin $32.98M $29.96M
YoY Change 10.1% -2.73%
% of Gross Profit 74.08% 59.36%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $25.17M $27.56M
YoY Change -8.67% 30.29%
% of Gross Profit 56.53% 54.61%
Operating Expenses $32.98M $29.96M
YoY Change 10.1% -2.73%
Operating Profit $11.54M $20.51M
YoY Change -43.74% -45.69%
Interest Expense -$8.020M -$8.043M
YoY Change -0.29% 5.23%
% of Operating Profit -69.5% -39.22%
Other Income/Expense, Net -$1.300M $0.00
YoY Change
Pretax Income $2.240M $12.52M
YoY Change -82.1% -58.45%
Income Tax -$360.0K $5.000M
% Of Pretax Income -16.07% 39.95%
Net Earnings $2.600M $7.515M
YoY Change -65.4% -59.26%
Net Earnings / Revenue 0.6% 1.72%
Basic Earnings Per Share $0.16 $0.46
Diluted Earnings Per Share $0.16 $0.45
COMMON SHARES
Basic Shares Outstanding 16.48M shares 16.48M shares
Diluted Shares Outstanding 16.58M shares 16.64M shares

Balance Sheet

Concept 2018 Q1 2017 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $12.10M $16.00M
YoY Change -24.38% 627.27%
Cash & Equivalents $12.06M $16.00M
Short-Term Investments
Other Short-Term Assets $8.740M $10.78M
YoY Change -18.89% 14.93%
Inventory $259.4M $240.7M
Prepaid Expenses
Receivables $137.6M $142.0M
Other Receivables $18.80M $4.100M
Total Short-Term Assets $436.7M $413.6M
YoY Change 5.59% 5.27%
LONG-TERM ASSETS
Property, Plant & Equipment $1.078B $959.5M
YoY Change 12.31% 9.9%
Goodwill $244.2M $244.3M
YoY Change -0.05% 16.83%
Intangibles $30.59M $38.59M
YoY Change -20.72% 105.76%
Long-Term Investments
YoY Change
Other Assets $22.84M $8.994M
YoY Change 153.94% 107.76%
Total Long-Term Assets $1.375B $1.251B
YoY Change 9.9% 13.11%
TOTAL ASSETS
Total Short-Term Assets $436.7M $413.6M
Total Long-Term Assets $1.375B $1.251B
Total Assets $1.812B $1.665B
YoY Change 8.83% 11.05%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $180.4M $133.5M
YoY Change 35.13% 20.05%
Accrued Expenses $61.60M $61.70M
YoY Change -0.16% -18.6%
Deferred Revenue
YoY Change
Short-Term Debt $168.5M $130.0M
YoY Change 29.62% 2066.67%
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $425.5M $340.4M
YoY Change 24.99% 64.93%
LONG-TERM LIABILITIES
Long-Term Debt $570.7M $569.9M
YoY Change 0.13% 0.13%
Other Long-Term Liabilities $42.19M $40.32M
YoY Change 4.63% -7.9%
Total Long-Term Liabilities $612.9M $610.3M
YoY Change 0.43% -0.44%
TOTAL LIABILITIES
Total Short-Term Liabilities $425.5M $340.4M
Total Long-Term Liabilities $612.9M $610.3M
Total Liabilities $1.231B $1.191B
YoY Change 3.34% 45.4%
SHAREHOLDERS EQUITY
Retained Earnings $633.7M $577.4M
YoY Change 9.76% 7.17%
Common Stock $2.000K $2.000K
YoY Change 0.0% 0.0%
Preferred Stock
YoY Change
Treasury Stock (at cost) $400.2M
YoY Change 11.9%
Treasury Stock Shares 7.821M shares
Shareholders Equity $580.7M $473.6M
YoY Change
Total Liabilities & Shareholders Equity $1.812B $1.665B
YoY Change 8.83% 11.05%

Cashflow Statement

Concept 2018 Q1 2017 Q1
OPERATING ACTIVITIES
Net Income $2.600M $7.515M
YoY Change -65.4% -59.26%
Depreciation, Depletion And Amortization $25.17M $27.56M
YoY Change -8.67% 30.29%
Cash From Operating Activities $30.86M $45.54M
YoY Change -32.23% -7.11%
INVESTING ACTIVITIES
Capital Expenditures $48.43M $42.25M
YoY Change 14.64% 36.48%
Acquisitions
YoY Change
Other Investing Activities -$768.0K -$368.0K
YoY Change 108.7% -222.67%
Cash From Investing Activities -$47.66M -$41.88M
YoY Change 13.81% 36.39%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $0.00 $4.875M
YoY Change -100.0% -82.38%
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities $13.14M -$10.67M
YoY Change -223.16% -50.85%
NET CHANGE
Cash From Operating Activities $30.86M $45.54M
Cash From Investing Activities -$47.66M -$41.88M
Cash From Financing Activities $13.14M -$10.67M
Net Change In Cash -$3.667M -$7.006M
YoY Change -47.66% 107.16%
FREE CASH FLOW
Cash From Operating Activities $30.86M $45.54M
Capital Expenditures $48.43M $42.25M
Free Cash Flow -$17.57M $3.291M
YoY Change -633.88% -81.78%

Facts In Submission

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OtherAccruedLiabilitiesCurrent
10348000 USD
CY2017Q4 us-gaap Other Assets Current
OtherAssetsCurrent
8661000 USD
CY2018Q1 us-gaap Other Assets Current
OtherAssetsCurrent
8740000 USD
CY2017Q4 us-gaap Other Assets Noncurrent
OtherAssetsNoncurrent
21778000 USD
CY2018Q1 us-gaap Other Assets Noncurrent
OtherAssetsNoncurrent
22839000 USD
CY2017Q1 us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Net Of Tax
OtherComprehensiveIncomeLossAmortizationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetPriorServiceCostCreditNetOfTax
-230000 USD
CY2017 us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Net Of Tax
OtherComprehensiveIncomeLossAmortizationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetPriorServiceCostCreditNetOfTax
-230000 USD
CY2018Q1 us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Net Of Tax
OtherComprehensiveIncomeLossAmortizationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetPriorServiceCostCreditNetOfTax
-309000 USD
CY2017Q1 us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Tax
OtherComprehensiveIncomeLossAmortizationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetPriorServiceCostCreditTax
151000 USD
CY2018Q1 us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Tax
OtherComprehensiveIncomeLossAmortizationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetPriorServiceCostCreditTax
110000 USD
CY2017Q1 us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
401000 USD
CY2018Q1 us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
1419000 USD
CY2017Q1 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Net Of Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetGainLossNetOfTax
-631000 USD
CY2018Q1 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Net Of Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetGainLossNetOfTax
-1728000 USD
CY2017Q1 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetGainLossTax
414000 USD
CY2018Q1 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetGainLossTax
617000 USD
CY2017Q1 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansTax
300000 USD
CY2018Q1 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansTax
500000 USD
CY2017Q4 us-gaap Other Inventory Supplies
OtherInventorySupplies
85987000 USD
CY2018Q1 us-gaap Other Inventory Supplies
OtherInventorySupplies
86714000 USD
CY2017Q4 us-gaap Other Liabilities Noncurrent
OtherLiabilitiesNoncurrent
43275000 USD
CY2018Q1 us-gaap Payments For Proceeds From Other Investing Activities
PaymentsForProceedsFromOtherInvestingActivities
-768000 USD
CY2017Q1 us-gaap Payments For Repurchase Of Common Stock
PaymentsForRepurchaseOfCommonStock
4875000 USD
CY2018Q1 us-gaap Payments For Repurchase Of Common Stock
PaymentsForRepurchaseOfCommonStock
0 USD
CY2018Q1 us-gaap Payments Related To Tax Withholding For Share Based Compensation
PaymentsRelatedToTaxWithholdingForShareBasedCompensation
220000 USD
CY2017Q1 us-gaap Payments To Acquire Property Plant And Equipment
PaymentsToAcquirePropertyPlantAndEquipment
42247000 USD
CY2018Q1 us-gaap Payments To Acquire Property Plant And Equipment
PaymentsToAcquirePropertyPlantAndEquipment
48430000 USD
CY2018Q1 us-gaap Other Liabilities Noncurrent
OtherLiabilitiesNoncurrent
42189000 USD
CY2017Q1 us-gaap Other Operating Activities Cash Flow Statement
OtherOperatingActivitiesCashFlowStatement
1699000 USD
CY2018Q1 us-gaap Other Operating Activities Cash Flow Statement
OtherOperatingActivitiesCashFlowStatement
-810000 USD
CY2017Q4 us-gaap Other Sundry Liabilities Noncurrent
OtherSundryLiabilitiesNoncurrent
6216000 USD
CY2018Q1 us-gaap Other Sundry Liabilities Noncurrent
OtherSundryLiabilitiesNoncurrent
5770000 USD
CY2017Q1 us-gaap Payments For Proceeds From Investments
PaymentsForProceedsFromInvestments
0 USD
CY2018Q1 us-gaap Payments For Proceeds From Investments
PaymentsForProceedsFromInvestments
0 USD
CY2017Q1 us-gaap Payments For Proceeds From Other Investing Activities
PaymentsForProceedsFromOtherInvestingActivities
-368000 USD
CY2017Q4 us-gaap Pension And Other Postretirement And Postemployment Benefit Plans Liabilities Current
PensionAndOtherPostretirementAndPostemploymentBenefitPlansLiabilitiesCurrent
7631000 USD
CY2018Q1 us-gaap Pension And Other Postretirement And Postemployment Benefit Plans Liabilities Current
PensionAndOtherPostretirementAndPostemploymentBenefitPlansLiabilitiesCurrent
7631000 USD
CY2017Q4 us-gaap Pension And Other Postretirement And Postemployment Benefit Plans Liabilities Noncurrent
PensionAndOtherPostretirementAndPostemploymentBenefitPlansLiabilitiesNoncurrent
72469000 USD
CY2018Q1 us-gaap Pension And Other Postretirement And Postemployment Benefit Plans Liabilities Noncurrent
PensionAndOtherPostretirementAndPostemploymentBenefitPlansLiabilitiesNoncurrent
70934000 USD
CY2017Q1 us-gaap Pension And Other Postretirement Benefit Expense
PensionAndOtherPostretirementBenefitExpense
-788000 USD
CY2018Q1 us-gaap Pension And Other Postretirement Benefit Expense
PensionAndOtherPostretirementBenefitExpense
312000 USD
CY2017Q4 us-gaap Preferred Stock Par Or Stated Value Per Share
PreferredStockParOrStatedValuePerShare
0.0001000000
CY2018Q1 us-gaap Preferred Stock Par Or Stated Value Per Share
PreferredStockParOrStatedValuePerShare
0.0001000000
CY2017Q4 us-gaap Preferred Stock Shares Authorized
PreferredStockSharesAuthorized
5000000 shares
CY2018Q1 us-gaap Preferred Stock Shares Authorized
PreferredStockSharesAuthorized
5000000 shares
CY2017Q4 us-gaap Preferred Stock Shares Issued
PreferredStockSharesIssued
0.00000 shares
CY2018Q1 us-gaap Preferred Stock Shares Issued
PreferredStockSharesIssued
0.00000 shares
CY2017Q4 us-gaap Preferred Stock Value
PreferredStockValue
0 USD
CY2018Q1 us-gaap Preferred Stock Value
PreferredStockValue
0 USD
CY2017Q1 us-gaap Proceeds From Income Tax Refunds
ProceedsFromIncomeTaxRefunds
5551000 USD
CY2018Q1 us-gaap Proceeds From Income Tax Refunds
ProceedsFromIncomeTaxRefunds
1873000 USD
CY2017Q1 us-gaap Proceeds From Lines Of Credit
ProceedsFromLinesOfCredit
91000000 USD
CY2018Q1 us-gaap Proceeds From Lines Of Credit
ProceedsFromLinesOfCredit
87325000 USD
CY2017Q1 us-gaap Proceeds From Payments For Other Financing Activities
ProceedsFromPaymentsForOtherFinancingActivities
-790000 USD
CY2018Q1 us-gaap Proceeds From Payments For Other Financing Activities
ProceedsFromPaymentsForOtherFinancingActivities
-365000 USD
CY2017Q4 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
1050982000 USD
CY2018Q1 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
1077643000 USD
CY2017Q4 us-gaap Receivables Net Current
ReceivablesNetCurrent
142065000 USD
CY2018Q1 us-gaap Receivables Net Current
ReceivablesNetCurrent
137622000 USD
CY2017Q1 us-gaap Repayments Of Lines Of Credit
RepaymentsOfLinesOfCredit
96000000 USD
CY2018Q1 us-gaap Repayments Of Lines Of Credit
RepaymentsOfLinesOfCredit
73825000 USD
CY2017Q4 us-gaap Retained Earnings Accumulated Deficit
RetainedEarningsAccumulatedDeficit
618254000 USD
CY2018Q1 us-gaap Retained Earnings Accumulated Deficit
RetainedEarningsAccumulatedDeficit
633706000 USD
CY2017Q1 us-gaap Sales Revenue Net
SalesRevenueNet
437525000 USD
CY2018Q1 us-gaap Sales Revenue Net
SalesRevenueNet
436952000 USD
CY2017Q1 us-gaap Selling General And Administrative Expense
SellingGeneralAndAdministrativeExpense
29955000 USD
CY2018Q1 us-gaap Selling General And Administrative Expense
SellingGeneralAndAdministrativeExpense
32980000 USD
CY2018Q1 us-gaap Severance Costs1
SeveranceCosts1
5100000 USD
CY2017Q1 us-gaap Share Based Compensation
ShareBasedCompensation
17000 USD
CY2018Q1 us-gaap Share Based Compensation
ShareBasedCompensation
781000 USD
CY2018Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Exercisable Weighted Average Exercise Price
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisableWeightedAverageExercisePrice
63.19
CY2018Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Expirations In Period
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExpirationsInPeriod
912 shares
CY2018Q1 us-gaap Share Based Compensation Arrangements By Share Based Payment Award Options Expirations In Period Weighted Average Exercise Price
ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsExpirationsInPeriodWeightedAverageExercisePrice
66.97
CY2018Q1 us-gaap Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range Number Of Exercisable Options
ShareBasedCompensationSharesAuthorizedUnderStockOptionPlansExercisePriceRangeNumberOfExercisableOptions
303840 shares
CY2018Q1 us-gaap Stock Repurchase Program Remaining Authorized Repurchase Amount1
StockRepurchaseProgramRemainingAuthorizedRepurchaseAmount1
29800000 USD
CY2017Q4 us-gaap Stockholders Equity
StockholdersEquity
575434000 USD
CY2018Q1 us-gaap Stockholders Equity
StockholdersEquity
580720000 USD
CY2017Q1 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
16642375.000 shares
CY2018Q1 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
16577411.000 shares
CY2017Q1 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
16484069.000 shares
CY2018Q1 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
16476011.000 shares
CY2018Q1 us-gaap Revenue Recognition Sales Of Goods
RevenueRecognitionSalesOfGoods
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:13px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">REVENUE RECOGNITION</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We enter into contracts that can include various combinations of tissue and paperboard products, which are generally capable of being distinct and accounted for as separate performance obligations. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Revenue is recognized at a point in time upon transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. Transfer of control typically occurs when the title and risk of loss passes to the customer. Shipping terms generally indicate when title and the risk of loss have passed. Revenue is recognized at shipment for sales when shipping terms are free on board, or FOB, shipping point. For sales where shipping terms are FOB destination, revenue is recognized when the goods are received by the customer. Revenue from both domestic and foreign sales of our products can involve shipping terms of either FOB shipping point or FOB destination or other shipping terms, depending upon the sales agreement with the customer. We have elected to treat shipping and handling costs for FOB shipping point contracts as a fulfillment cost, not as a separate performance obligation. No revenue is recognized over time. We typically expense incremental direct costs of obtaining a contract (sales commissions) when incurred because the amortization period is generally </font><font style="font-family:inherit;font-size:10pt;">12</font><font style="font-family:inherit;font-size:10pt;"> months or less. We have also elected to use the practical expedient to not disclose unsatisfied or partially satisfied performance obligations as we have no unsatisfied contracts where the remaining portions are expected to be satisfied in a period greater than one year.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We provide for trade promotions, customer cash discounts, customer returns and other deductions as reductions to net sales, which are accounted for as variable consideration when estimating the amount of revenue to recognize</font><font style="font-family:inherit;font-size:10pt;color:#0000ff;">.</font><font style="font-family:inherit;font-size:10pt;"> Returns and credits are estimated at contract inception and updated at the end of each reporting period as additional information becomes available. Revenue net of returns and credits is only recognized to the extent that it is probable that a significant reversal of any incremental revenue will not occur. Significant judgment is required to determine the most probable amount of variable consideration to apply as a reduction to net sales. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Payment terms and conditions vary by contract type. Terms generally include a requirement of payment within </font><font style="font-family:inherit;font-size:10pt;">30</font><font style="font-family:inherit;font-size:10pt;"> days, and do not include a significant financing component. </font></div><div style="line-height:120%;padding-top:8px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Trade accounts receivable are stated at the amount we expect to collect. Trade accounts receivable do not bear interest. The allowance for doubtful accounts is our best estimate of the losses we expect will result from the inability of our customers to make required payments. We generally determine the allowance based on a combination of actual historical write-off experience and an analysis of specific customer accounts. As of </font><font style="font-family:inherit;font-size:10pt;">March&#160;31, 2018</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">December&#160;31, 2017</font><font style="font-family:inherit;font-size:10pt;">, we had allowances for doubtful accounts of $</font><font style="font-family:inherit;font-size:10pt;">1.3 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$1.4 million</font><font style="font-family:inherit;font-size:10pt;">, respectively.</font></div><div style="line-height:120%;padding-top:8px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Refer to Note 15, "Segment Information," for further information, including the disaggregation of revenue by segment, primary geographical market, and major product type.</font></div></div>
CY2018Q1 us-gaap Use Of Estimates
UseOfEstimates
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:9px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">SIGNIFICANT ESTIMATES</font></div><div style="line-height:120%;padding-top:6px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net sales and expenses during the reporting periods. Significant areas that may require the use of estimates and measurement of uncertainty include determination of net realizable value for deferred tax assets, uncertain tax positions, assessment of impairment of long-lived assets, variable consideration or reductions to revenue, revenue recognition estimates related to allocating the transaction price to various performance obligations, goodwill and intangibles, assessment of environmental matters, equity-based compensation and pension and postretirement obligation assumptions. Actual results could differ from those estimates and assumptions.</font></div></div>

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