2017 Q2 Form 10-Q Financial Statement

#000004288817000011 Filed on April 26, 2017

View on sec.gov

Income Statement

Concept 2017 Q2 2017 Q1 2016 Q1
Revenue $379.5M $340.6M $304.9M
YoY Change 9.01% 11.7% -0.5%
Cost Of Revenue $175.0M $154.7M $143.1M
YoY Change 7.36% 8.13% -0.84%
Gross Profit $204.5M $185.8M $161.8M
YoY Change 10.46% 14.86% -0.21%
Gross Profit Margin 53.89% 54.57% 53.06%
Selling, General & Admin $89.44M $84.15M $86.16M
YoY Change -1.92% -2.33% 5.58%
% of Gross Profit 43.73% 45.28% 53.25%
Research & Development $14.66M $14.26M $14.69M
YoY Change -6.05% -2.91% -3.95%
% of Gross Profit 7.17% 7.67% 9.08%
Depreciation & Amortization $11.30M $11.09M $12.01M
YoY Change -9.6% -7.63% 11.1%
% of Gross Profit 5.53% 5.97% 7.42%
Operating Expenses $104.1M $98.41M $100.8M
YoY Change -2.53% -2.42% 4.08%
Operating Profit $100.4M $87.44M $60.95M
YoY Change 28.17% 43.46% -6.56%
Interest Expense $4.154M $4.055M $4.493M
YoY Change -8.56% -9.75% -15.27%
% of Operating Profit 4.14% 4.64% 7.37%
Other Income/Expense, Net -$652.0K -$1.805M $1.146M
YoY Change 66.33% -257.5% -261.41%
Pretax Income $95.60M $81.58M $57.60M
YoY Change 30.24% 41.62% -35.09%
Income Tax $15.78M $20.84M $18.05M
% Of Pretax Income 16.5% 25.55% 31.34%
Net Earnings $79.83M $60.73M $39.55M
YoY Change 56.69% 53.55% -42.55%
Net Earnings / Revenue 21.04% 17.83% 12.97%
Basic Earnings Per Share $0.48 $0.36 $0.24
Diluted Earnings Per Share $0.46 $0.35 $0.23
COMMON SHARES
Basic Shares Outstanding 55.55M shares 56.00M shares 55.12M shares
Diluted Shares Outstanding 173.8M shares 173.1M shares 56.71M shares

Balance Sheet

Concept 2017 Q2 2017 Q1 2016 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $75.40M $76.60M $36.50M
YoY Change 71.75% 109.86% -91.88%
Cash & Equivalents $75.45M $76.57M $36.49M
Short-Term Investments
Other Short-Term Assets $22.92M $20.74M $20.99M
YoY Change -8.22% -1.21% 128.83%
Inventory $221.4M $214.9M $212.3M
Prepaid Expenses
Receivables $259.9M $244.4M $226.0M
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $579.7M $556.6M $495.8M
YoY Change 11.86% 12.26% -45.23%
LONG-TERM ASSETS
Property, Plant & Equipment $193.6M $191.9M $184.2M
YoY Change 2.08% 4.2% 9.57%
Goodwill $273.1M $269.3M $419.4M
YoY Change -34.38% -35.79% 6.61%
Intangibles $183.9M $182.8M $248.8M
YoY Change -23.51% -26.52% 2.54%
Long-Term Investments
YoY Change
Other Assets $25.94M $25.91M $24.00M
YoY Change 6.46% 7.96% -7.93%
Total Long-Term Assets $762.1M $757.2M $935.2M
YoY Change -18.29% -19.03% 8.42%
TOTAL ASSETS
Total Short-Term Assets $579.7M $556.6M $495.8M
Total Long-Term Assets $762.1M $757.2M $935.2M
Total Assets $1.342B $1.314B $1.431B
YoY Change -7.52% -8.19% -19.05%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $44.45M $43.91M $40.33M
YoY Change 11.03% 8.87% -12.19%
Accrued Expenses $62.50M $48.00M $48.60M
YoY Change 16.6% -1.23% 3.4%
Deferred Revenue
YoY Change
Short-Term Debt $11.10M $9.400M $14.50M
YoY Change -16.54% -35.17% -72.12%
Long-Term Debt Due $75.00M $75.00M
YoY Change
Total Short-Term Liabilities $264.1M $253.7M $161.8M
YoY Change 55.51% 56.84% -26.03%
LONG-TERM LIABILITIES
Long-Term Debt $236.0M $302.7M $457.7M
YoY Change -45.05% -33.87% -40.33%
Other Long-Term Liabilities $8.597M $8.697M $8.730M
YoY Change -1.52% -0.38% 36.94%
Total Long-Term Liabilities $244.6M $311.4M $466.4M
YoY Change -44.18% -33.24% -39.7%
TOTAL LIABILITIES
Total Short-Term Liabilities $264.1M $253.7M $161.8M
Total Long-Term Liabilities $244.6M $311.4M $466.4M
Total Liabilities $508.7M $565.1M $628.2M
YoY Change -16.34% -10.04% -36.68%
SHAREHOLDERS EQUITY
Retained Earnings $224.8M $165.0M $264.9M
YoY Change -24.43% -37.72% 1.07%
Common Stock $549.3M $536.7M $478.0M
YoY Change 11.85% 12.28% 4.58%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $651.6M $567.0M $636.9M
YoY Change
Total Liabilities & Shareholders Equity $1.342B $1.314B $1.431B
YoY Change -7.52% -8.19% -19.05%

Cashflow Statement

Concept 2017 Q2 2017 Q1 2016 Q1
OPERATING ACTIVITIES
Net Income $79.83M $60.73M $39.55M
YoY Change 56.69% 53.55% -42.55%
Depreciation, Depletion And Amortization $11.30M $11.09M $12.01M
YoY Change -9.6% -7.63% 11.1%
Cash From Operating Activities $85.50M $50.22M $28.88M
YoY Change 32.35% 73.92% -38.85%
INVESTING ACTIVITIES
Capital Expenditures -$8.400M $8.200M $13.12M
YoY Change -34.88% -37.5% 33.94%
Acquisitions $9.968M $48.88M
YoY Change -79.61% -73.28%
Other Investing Activities -$400.0K $62.00K -$320.0K
YoY Change -33.33% -119.38% 742.11%
Cash From Investing Activities -$8.800M -$17.59M -$60.81M
YoY Change -34.81% -71.07% -68.44%
FINANCING ACTIVITIES
Cash Dividend Paid $20.12M $18.33M
YoY Change 9.74% 3.4%
Common Stock Issuance & Retirement, Net $60.03M $27.94M
YoY Change 114.87% -18.28%
Debt Paid & Issued, Net $119.2M $233.7M
YoY Change -49.02% 2.94%
Cash From Financing Activities -79.50M -$7.920M $17.24M
YoY Change 83.6% -145.93% -88.35%
NET CHANGE
Cash From Operating Activities 85.50M $50.22M $28.88M
Cash From Investing Activities -8.800M -$17.59M -$60.81M
Cash From Financing Activities -79.50M -$7.920M $17.24M
Net Change In Cash -2.800M $24.71M -$14.69M
YoY Change -135.9% -268.28% -668.09%
FREE CASH FLOW
Cash From Operating Activities $85.50M $50.22M $28.88M
Capital Expenditures -$8.400M $8.200M $13.12M
Free Cash Flow $93.90M $42.02M $15.76M
YoY Change 21.16% 166.7% -57.9%

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CY2017Q1 us-gaap Noncurrent Assets
NoncurrentAssets
191948000 USD
CY2017Q1 us-gaap Number Of Reportable Segments
NumberOfReportableSegments
3 segment
CY2016Q1 us-gaap Operating Income Loss
OperatingIncomeLoss
60949000 USD
CY2017Q1 us-gaap Operating Income Loss
OperatingIncomeLoss
85821000 USD
CY2016Q4 us-gaap Other Accrued Liabilities Current
OtherAccruedLiabilitiesCurrent
22505000 USD
CY2017Q1 us-gaap Other Accrued Liabilities Current
OtherAccruedLiabilitiesCurrent
23397000 USD
CY2016Q4 us-gaap Other Assets Current
OtherAssetsCurrent
31023000 USD
CY2017Q1 us-gaap Other Assets Current
OtherAssetsCurrent
20739000 USD
CY2016Q4 us-gaap Other Assets Noncurrent
OtherAssetsNoncurrent
25313000 USD
CY2017Q1 us-gaap Other Assets Noncurrent
OtherAssetsNoncurrent
25905000 USD
CY2016Q1 us-gaap Other Comprehensive Income Loss Before Reclassifications Net Of Tax
OtherComprehensiveIncomeLossBeforeReclassificationsNetOfTax
-2402000 USD
CY2017Q1 us-gaap Other Comprehensive Income Loss Before Reclassifications Net Of Tax
OtherComprehensiveIncomeLossBeforeReclassificationsNetOfTax
6318000 USD
CY2016Q1 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
-2402000 USD
CY2017Q1 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
6318000 USD
CY2016Q1 us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
-1498000 USD
CY2017Q1 us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
7552000 USD
CY2016Q1 us-gaap Other Comprehensive Income Loss Pension And Other Postretirement Benefit Plans Adjustment Net Of Tax
OtherComprehensiveIncomeLossPensionAndOtherPostretirementBenefitPlansAdjustmentNetOfTax
-1473000 USD
CY2017Q1 us-gaap Other Comprehensive Income Loss Pension And Other Postretirement Benefit Plans Adjustment Net Of Tax
OtherComprehensiveIncomeLossPensionAndOtherPostretirementBenefitPlansAdjustmentNetOfTax
-2000000 USD
CY2016Q1 us-gaap Other Comprehensive Income Loss Pension And Other Postretirement Benefit Plans Tax
OtherComprehensiveIncomeLossPensionAndOtherPostretirementBenefitPlansTax
-569000 USD
CY2017Q1 us-gaap Other Comprehensive Income Loss Pension And Other Postretirement Benefit Plans Tax
OtherComprehensiveIncomeLossPensionAndOtherPostretirementBenefitPlansTax
-766000 USD
CY2016Q4 us-gaap Other Employee Related Liabilities Current
OtherEmployeeRelatedLiabilitiesCurrent
9328000 USD
CY2017Q1 us-gaap Other Employee Related Liabilities Current
OtherEmployeeRelatedLiabilitiesCurrent
1499000 USD
CY2016Q4 us-gaap Other Liabilities Current
OtherLiabilitiesCurrent
71887000 USD
CY2017Q1 us-gaap Other Liabilities Current
OtherLiabilitiesCurrent
78504000 USD
CY2016Q4 us-gaap Other Liabilities Noncurrent
OtherLiabilitiesNoncurrent
8697000 USD
CY2017Q1 us-gaap Other Liabilities Noncurrent
OtherLiabilitiesNoncurrent
8697000 USD
CY2016Q1 us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
1146000 USD
CY2017Q1 us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
-191000 USD
CY2016Q1 us-gaap Payments For Proceeds From Other Investing Activities
PaymentsForProceedsFromOtherInvestingActivities
-320000 USD
CY2017Q1 us-gaap Payments For Proceeds From Other Investing Activities
PaymentsForProceedsFromOtherInvestingActivities
62000 USD
CY2016Q1 us-gaap Payments For Repurchase Of Common Stock
PaymentsForRepurchaseOfCommonStock
48050000 USD
CY2017Q1 us-gaap Payments For Repurchase Of Common Stock
PaymentsForRepurchaseOfCommonStock
90160000 USD
CY2016Q1 us-gaap Payments Of Dividends
PaymentsOfDividends
18332000 USD
CY2017Q1 us-gaap Payments Of Dividends
PaymentsOfDividends
20118000 USD
CY2016Q1 us-gaap Payments To Acquire Businesses Net Of Cash Acquired
PaymentsToAcquireBusinessesNetOfCashAcquired
48881000 USD
CY2017Q1 us-gaap Payments To Acquire Businesses Net Of Cash Acquired
PaymentsToAcquireBusinessesNetOfCashAcquired
9968000 USD
CY2016Q1 us-gaap Payments To Acquire Property Plant And Equipment
PaymentsToAcquirePropertyPlantAndEquipment
13121000 USD
CY2017Q1 us-gaap Payments To Acquire Property Plant And Equipment
PaymentsToAcquirePropertyPlantAndEquipment
8200000 USD
CY2016Q4 us-gaap Pension And Other Postretirement Defined Benefit Plans Liabilities Noncurrent
PensionAndOtherPostretirementDefinedBenefitPlansLiabilitiesNoncurrent
159250000 USD
CY2017Q1 us-gaap Pension And Other Postretirement Defined Benefit Plans Liabilities Noncurrent
PensionAndOtherPostretirementDefinedBenefitPlansLiabilitiesNoncurrent
161562000 USD
CY2016Q1 us-gaap Proceeds From Issuance Of Common Stock
ProceedsFromIssuanceOfCommonStock
20111000 USD
CY2017Q1 us-gaap Proceeds From Issuance Of Common Stock
ProceedsFromIssuanceOfCommonStock
30127000 USD
CY2016Q1 us-gaap Proceeds From Issuance Of Long Term Debt
ProceedsFromIssuanceOfLongTermDebt
298709000 USD
CY2017Q1 us-gaap Proceeds From Issuance Of Long Term Debt
ProceedsFromIssuanceOfLongTermDebt
191120000 USD
CY2016Q1 us-gaap Proceeds From Repayments Of Lines Of Credit
ProceedsFromRepaymentsOfLinesOfCredit
-1461000 USD
CY2017Q1 us-gaap Proceeds From Repayments Of Lines Of Credit
ProceedsFromRepaymentsOfLinesOfCredit
261000 USD
CY2016Q4 us-gaap Product Warranty Accrual
ProductWarrantyAccrual
8934000 USD
CY2017Q1 us-gaap Product Warranty Accrual
ProductWarrantyAccrual
9303000 USD
CY2017Q1 us-gaap Product Warranty Accrual Payments
ProductWarrantyAccrualPayments
2194000 USD
CY2017Q1 us-gaap Share Based Compensation
ShareBasedCompensation
5477000 USD
CY2017Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Discount From Market Price Offering Date
ShareBasedCompensationArrangementByShareBasedPaymentAwardDiscountFromMarketPriceOfferingDate
0.15
CY2016Q4 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Exercisable Number
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisableNumber
3672000 shares
CY2017Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Exercisable Number
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisableNumber
3769000 shares
CY2016Q4 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Exercisable Weighted Average Exercise Price
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisableWeightedAverageExercisePrice
45.40
CY2017Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Exercisable Weighted Average Exercise Price
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisableWeightedAverageExercisePrice
48.24
CY2017Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Forfeitures And Expirations In Period
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeituresAndExpirationsInPeriod
11000 shares
CY2017Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Forfeitures And Expirations In Period Weighted Average Exercise Price
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeituresAndExpirationsInPeriodWeightedAverageExercisePrice
77.19
CY2017Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Grants In Period
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriod
539000 shares
CY2016Q4 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Number
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber
5535000 shares
CY2017Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Number
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber
5676000 shares
CY2016Q4 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Weighted Average Exercise Price
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice
55.26
CY2017Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Weighted Average Exercise Price
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice
59.09
CY2017Q1 us-gaap Product Warranty Expense
ProductWarrantyExpense
1855000 USD
CY2016Q4 us-gaap Property Plant And Equipment Gross
PropertyPlantAndEquipmentGross
489642000 USD
CY2017Q1 us-gaap Property Plant And Equipment Gross
PropertyPlantAndEquipmentGross
499014000 USD
CY2016Q4 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
189596000 USD
CY2017Q1 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
191948000 USD
CY2016Q4 us-gaap Receivables Net Current
ReceivablesNetCurrent
218365000 USD
CY2017Q1 us-gaap Receivables Net Current
ReceivablesNetCurrent
244395000 USD
CY2016Q1 us-gaap Reclassification From Accumulated Other Comprehensive Income Current Period Net Of Tax
ReclassificationFromAccumulatedOtherComprehensiveIncomeCurrentPeriodNetOfTax
-904000 USD
CY2017Q1 us-gaap Reclassification From Accumulated Other Comprehensive Income Current Period Net Of Tax
ReclassificationFromAccumulatedOtherComprehensiveIncomeCurrentPeriodNetOfTax
-1234000 USD
CY2016Q1 us-gaap Repayments Of Long Term Debt
RepaymentsOfLongTermDebt
233734000 USD
CY2017Q1 us-gaap Repayments Of Long Term Debt
RepaymentsOfLongTermDebt
119150000 USD
CY2016Q1 us-gaap Research And Development Expense
ResearchAndDevelopmentExpense
14686000 USD
CY2017Q1 us-gaap Research And Development Expense
ResearchAndDevelopmentExpense
14499000 USD
CY2016Q4 us-gaap Retained Earnings Accumulated Deficit
RetainedEarningsAccumulatedDeficit
206820000 USD
CY2017Q1 us-gaap Retained Earnings Accumulated Deficit
RetainedEarningsAccumulatedDeficit
164970000 USD
CY2016Q1 us-gaap Sales Revenue Net
SalesRevenueNet
304912000 USD
CY2017Q1 us-gaap Sales Revenue Net
SalesRevenueNet
340590000 USD
CY2016Q4 us-gaap Self Insurance Reserve Current
SelfInsuranceReserveCurrent
7105000 USD
CY2017Q1 us-gaap Self Insurance Reserve Current
SelfInsuranceReserveCurrent
7146000 USD
CY2016Q1 us-gaap Selling And Marketing Expense
SellingAndMarketingExpense
52701000 USD
CY2017Q1 us-gaap Selling And Marketing Expense
SellingAndMarketingExpense
54911000 USD
CY2016Q1 us-gaap Share Based Compensation
ShareBasedCompensation
6093000 USD
CY2017Q1 us-gaap Share Based Compensation Arrangements By Share Based Payment Award Options Exercises In Period Weighted Average Exercise Price
ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsExercisesInPeriodWeightedAverageExercisePrice
48.38
CY2017Q1 us-gaap Share Based Compensation Arrangements By Share Based Payment Award Options Grants In Period Weighted Average Exercise Price
ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageExercisePrice
91.02
CY2016Q4 us-gaap Short Term Bank Loans And Notes Payable
ShortTermBankLoansAndNotesPayable
8913000 USD
CY2017Q1 us-gaap Short Term Bank Loans And Notes Payable
ShortTermBankLoansAndNotesPayable
9380000 USD
CY2017Q1 us-gaap Stock Issued During Period Shares Stock Options Exercised
StockIssuedDuringPeriodSharesStockOptionsExercised
387000 shares
CY2016Q4 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
573820000 USD
CY2017Q1 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
567011000 USD
CY2016Q1 us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
1315000 shares
CY2017Q1 us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
1944000 shares
CY2016Q1 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
56709000 shares
CY2017Q1 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
57712000 shares
CY2016Q1 us-gaap Weighted Average Number Of Shares Issued Basic
WeightedAverageNumberOfSharesIssuedBasic
55394000 shares
CY2017Q1 us-gaap Weighted Average Number Of Shares Issued Basic
WeightedAverageNumberOfSharesIssuedBasic
55768000 shares
CY2017Q1 us-gaap Description Of New Accounting Pronouncements Not Yet Adopted
DescriptionOfNewAccountingPronouncementsNotYetAdopted
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">In May 2014, the Financial Accounting Standards Board (FASB) issued a final standard on revenue from contracts with customers. The new standard sets forth a single comprehensive model for recognizing and reporting revenue. The new standard is effective for the Company in its fiscal year 2018 and permits the use of either a retrospective or a modified retrospective transition method.</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">We have established an implementation team and engaged a third-party consultant to assist with our assessment of the impact of the new revenue guidance on our operations, consolidated financial statements and related disclosures. To date, this assessment has included (1) utilizing questionnaires to assist with the identification of our revenue streams, (2) performing sample contract analyses for each revenue stream identified, and (3) assessing the noted differences in recognition and measurement that may result from adopting this new standard. Based on the preliminary results of the evaluation, which is still in process, nothing has come to our attention that would indicate that adoption of the new standard will have a material impact on our consolidated financial statements. However, given our acquisition strategy, there may be additional revenue streams acquired prior to the adoption date. We currently believe the most significant potential changes relate to variable consideration and whether certain contracts' revenues will be recognized over time or at a point in time, although our technical analysis of these potential impacts is still on-going. We also anticipate changes to the consolidated balance sheet related to accounts receivable, contract assets, and contract liabilities.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">We are in the process of evaluating and designing the necessary changes to our business processes, systems and controls to support recognition and disclosure under the new standard. Further, we are continuing to assess what incremental disaggregated revenue disclosures will be required in our consolidated financial statements, and we continue to evaluate transition methods.</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">In March 2017, the FASB issued a final standard that changes the presentation of net periodic benefit cost related to defined benefit plans. The Company will adopt the standard when it becomes effective in fiscal 2018 and it will be applied retrospectively to all periods presented. Under the new standard, net periodic benefit costs are required to be disaggregated between service costs presented as operating expenses and other components of pension costs presented as non-operating expenses. The Company currently charges service costs to segment operations and includes other components of pension cost in unallocated corporate operating expenses. Under the new standard, unallocated corporate operating expenses will decrease, operating earnings will increase and other expense will increase by the amount of other (non-service) components of pension cost. There will be no impact on reported segment earnings, net earnings or earnings per share.</font></div></div>

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