☒ | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
☐ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
PENNSYLVANIA
|
25‑0644320
|
|
(State or other jurisdiction of
|
(I.R.S. Employer
|
|
Incorporation or organization)
|
Identification No.)
|
TWO NORTHSHORE CENTER, PITTSBURGH, PA
|
15212‑5851
|
|
(Address of principal executive offices)
|
(Zip Code)
|
|
Registrant's telephone number, including area code
|
(412) 442‑8200
|
Yes ☒
|
No ☐
|
Yes ☒
|
No ☐
|
Large accelerated filer ☒
|
Accelerated filer ☐
|
Non-accelerated filer ☐
|
Smaller reporting company ☐
|
Yes ☐
|
No ☒
|
March 31, 2016
|
September 30, 2015
|
|||||||||||||||
ASSETS
|
||||||||||||||||
Current assets:
|
||||||||||||||||
Cash and cash equivalents
|
$
|
59,332
|
$
|
72,196
|
||||||||||||
Accounts receivable, net
|
273,785
|
283,963
|
||||||||||||||
Inventories
|
169,304
|
171,423
|
||||||||||||||
Other current assets
|
76,194
|
77,319
|
||||||||||||||
Total current assets
|
578,615
|
604,901
|
||||||||||||||
Investments
|
26,139
|
25,517
|
||||||||||||||
Property, plant and equipment: Cost
|
$
|
522,207
|
$
|
501,595
|
||||||||||||
Less accumulated depreciation
|
(292,805
|
)
|
(274,187
|
)
|
||||||||||||
229,402
|
227,408
|
|||||||||||||||
Deferred income taxes
|
20,105
|
20,691
|
||||||||||||||
Other assets
|
17,080
|
13,773
|
||||||||||||||
Goodwill
|
865,618
|
855,728
|
||||||||||||||
Other intangible assets, net
|
406,942
|
415,000
|
||||||||||||||
Total assets
|
$
|
2,143,901
|
$
|
2,163,018
|
||||||||||||
LIABILITIES
|
||||||||||||||||
Current liabilities:
|
||||||||||||||||
Long-term debt, current maturities
|
$
|
12,857
|
$
|
11,737
|
||||||||||||
Trade accounts payable
|
59,998
|
68,896
|
||||||||||||||
Accrued compensation
|
56,258
|
63,931
|
||||||||||||||
Accrued income taxes
|
9,214
|
11,448
|
||||||||||||||
Other current liabilities
|
91,725
|
92,731
|
||||||||||||||
Total current liabilities
|
230,052
|
248,743
|
||||||||||||||
Long-term debt
|
875,316
|
891,217
|
||||||||||||||
Accrued pension
|
98,939
|
95,753
|
||||||||||||||
Postretirement benefits
|
19,435
|
19,415
|
||||||||||||||
Deferred income taxes
|
144,305
|
144,705
|
||||||||||||||
Other liabilities
|
31,700
|
29,139
|
||||||||||||||
Total liabilities
|
1,399,747
|
1,428,972
|
||||||||||||||
SHAREHOLDERS' EQUITY
|
||||||||||||||||
Shareholders' equity-Matthews:
|
||||||||||||||||
Common stock
|
$
|
36,334
|
$
|
36,334
|
||||||||||||
Additional paid-in capital
|
110,750
|
115,890
|
||||||||||||||
Retained earnings
|
853,280
|
843,955
|
||||||||||||||
Accumulated other comprehensive loss
|
(144,080
|
)
|
(150,326
|
)
|
||||||||||||
Treasury stock, at cost
|
(113,666
|
)
|
(115,033
|
)
|
||||||||||||
Total shareholders' equity-Matthews
|
742,618
|
730,820
|
||||||||||||||
Noncontrolling interests
|
1,536
|
3,226
|
||||||||||||||
Total shareholders' equity
|
744,154
|
734,046
|
||||||||||||||
Total liabilities and shareholders' equity
|
$
|
2,143,901
|
$
|
2,163,018
|
|
|
|||||||||||||||
Three Months Ended March 31,
|
Six Months Ended March 31,
|
|||||||||||||||
2016
|
2015
|
2016
|
2015
|
|||||||||||||
Sales
|
$
|
367,176
|
$
|
349,394
|
$
|
721,408
|
$
|
692,978
|
||||||||
Cost of sales
|
(229,416
|
)
|
(221,699
|
)
|
(457,081
|
)
|
(440,613
|
)
|
||||||||
Gross profit
|
137,760
|
127,695
|
264,327
|
252,365
|
||||||||||||
Selling and administrative expenses
|
(111,325
|
)
|
(108,420
|
)
|
(225,854
|
)
|
(207,505
|
)
|
||||||||
Operating profit
|
26,435
|
19,275
|
38,473
|
44,860
|
||||||||||||
Investment income
|
235
|
702
|
936
|
973
|
||||||||||||
Interest expense
|
(6,049
|
)
|
(4,934
|
)
|
(11,889
|
)
|
(10,267
|
)
|
||||||||
Other income (deductions), net
|
(192
|
)
|
(2,121
|
)
|
(1,066
|
)
|
(3,425
|
)
|
||||||||
Income before income taxes
|
20,429
|
12,922
|
26,454
|
32,141
|
||||||||||||
Income taxes
|
(6,163
|
)
|
(4,095
|
)
|
(7,685
|
)
|
(9,069
|
)
|
||||||||
Net income
|
14,266
|
8,827
|
18,769
|
23,072
|
||||||||||||
Net loss attributable to noncontrolling interests
|
91
|
148
|
202
|
263
|
||||||||||||
Net income attributable to Matthews shareholders
|
$
|
14,357
|
$
|
8,975
|
$
|
18,971
|
$
|
23,335
|
||||||||
Earnings per share attributable to Matthews shareholders:
|
||||||||||||||||
Basic
|
$
|
0.44
|
$
|
0.27
|
$
|
0.58
|
$
|
0.71
|
||||||||
Diluted
|
$
|
0.43
|
$
|
0.27
|
$
|
0.57
|
$
|
0.70
|
Three Months Ended March 31,
|
||||||||||||||||||||||||
Matthews
|
Noncontrolling Interest
|
Total
|
||||||||||||||||||||||
2016
|
2015
|
2016
|
2015
|
2016
|
2015
|
|||||||||||||||||||
Net income (loss):
|
$
|
14,357
|
$
|
8,975
|
$
|
(91
|
)
|
$
|
(148
|
)
|
$
|
14,266
|
$
|
8,827
|
||||||||||
Other comprehensive income (loss) ("OCI"), net of tax:
|
||||||||||||||||||||||||
Foreign currency translation adjustment
|
15,412
|
(41,648
|
)
|
(1
|
)
|
(61
|
)
|
15,411
|
(41,709
|
)
|
||||||||||||||
Pension plans and other postretirement
benefits
|
1,058
|
965
|
-
|
-
|
1,058
|
965
|
||||||||||||||||||
Unrecognized loss on derivatives:
|
||||||||||||||||||||||||
Net change from periodic revaluation
|
(3,294
|
)
|
(1,744
|
)
|
-
|
-
|
(3,294
|
)
|
(1,744
|
)
|
||||||||||||||
Net amount reclassified to earnings
|
455
|
608
|
-
|
-
|
455
|
608
|
||||||||||||||||||
Net change in unrecognized loss on
|
||||||||||||||||||||||||
derivatives
|
(2,839
|
)
|
(1,136
|
)
|
-
|
-
|
(2,839
|
)
|
(1,136
|
)
|
||||||||||||||
Other comprehensive income (loss), net of tax
|
13,631
|
(41,819
|
)
|
(1
|
)
|
(61
|
)
|
13,630
|
(41,880
|
)
|
||||||||||||||
Comprehensive income (loss)
|
$
|
27,988
|
$
|
(32,844
|
)
|
$
|
(92
|
)
|
$
|
(209
|
)
|
$
|
27,896
|
$
|
(33,053
|
)
|
Six Months Ended March 31,
|
||||||||||||||||||||||||
Matthews
|
Noncontrolling Interest
|
Total
|
||||||||||||||||||||||
2016
|
2015
|
2016
|
2015
|
2016
|
2015
|
|||||||||||||||||||
Net income (loss):
|
$
|
18,971
|
$
|
23,335
|
$
|
(202
|
)
|
$
|
(263
|
)
|
$
|
18,769
|
$
|
23,072
|
||||||||||
OCI, net of tax:
|
||||||||||||||||||||||||
Foreign currency translation adjustment
|
5,343
|
(67,930
|
)
|
(54
|
)
|
(71
|
)
|
5,289
|
(68,001
|
)
|
||||||||||||||
Pension plans and other postretirement
benefits
|
2,160
|
1,890
|
-
|
-
|
2,160
|
1,890
|
||||||||||||||||||
Unrecognized loss on derivatives:
|
||||||||||||||||||||||||
Net change from periodic revaluation
|
(2,218
|
)
|
(3,212
|
)
|
-
|
-
|
(2,218
|
)
|
(3,212
|
)
|
||||||||||||||
Net amount reclassified to earnings
|
961
|
1,265
|
-
|
-
|
961
|
1,265
|
||||||||||||||||||
Net change in unrecognized loss on
|
||||||||||||||||||||||||
derivatives
|
(1,257
|
)
|
(1,947
|
)
|
-
|
-
|
(1,257
|
)
|
(1,947
|
)
|
||||||||||||||
Other comprehensive income (loss), net of tax
|
6,246
|
(67,987
|
)
|
(54
|
)
|
(71
|
)
|
6,192
|
(68,058
|
)
|
||||||||||||||
Comprehensive income (loss)
|
$
|
25,217
|
$
|
(44,652
|
)
|
$
|
(256
|
)
|
$
|
(334
|
)
|
$
|
24,961
|
$
|
(44,986
|
)
|
Shareholders' Equity
|
||||||||||||||||||||||||||||
Accumulated
|
||||||||||||||||||||||||||||
Additional
|
Other
|
Non-
|
||||||||||||||||||||||||||
Common
|
Paid-in
|
Retained
|
Comprehensive
|
Treasury
|
controlling
|
|||||||||||||||||||||||
Stock
|
Capital
|
Earnings
|
Income (Loss)
|
Stock
|
interests
|
Total
|
||||||||||||||||||||||
Balance,
September 30, 2015
|
$
|
36,334
|
$
|
115,890
|
$
|
843,955
|
$
|
(150,326
|
)
|
$
|
(115,033
|
)
|
$
|
3,226
|
$
|
734,046
|
||||||||||||
Net income (loss)
|
-
|
-
|
18,971
|
-
|
-
|
(202
|
)
|
18,769
|
||||||||||||||||||||
Minimum pension liability
|
-
|
-
|
-
|
2,160
|
-
|
-
|
2,160
|
|||||||||||||||||||||
Translation adjustment
|
-
|
-
|
-
|
5,343
|
-
|
(54
|
)
|
5,289
|
||||||||||||||||||||
Fair value of derivatives
|
-
|
-
|
-
|
(1,257
|
)
|
-
|
-
|
(1,257
|
)
|
|||||||||||||||||||
Total comprehensive income
|
24,961
|
|||||||||||||||||||||||||||
Stock-based compensation
|
-
|
5,267
|
-
|
-
|
-
|
5,267
|
||||||||||||||||||||||
Purchase of 151,259 shares of treasury stock
|
-
|
-
|
-
|
-
|
(8,209
|
)
|
-
|
(8,209
|
)
|
|||||||||||||||||||
Issuance of 287,681 shares of treasury stock
|
-
|
(7,862
|
)
|
-
|
-
|
9,758
|
-
|
1,896
|
||||||||||||||||||||
Cancellations of 3,957 shares of treasury stock
|
-
|
182
|
-
|
-
|
(182
|
)
|
-
|
-
|
||||||||||||||||||||
Dividends, $.30 per share
|
-
|
-
|
(9,646
|
)
|
-
|
-
|
-
|
(9,646
|
)
|
|||||||||||||||||||
Acquisition of
noncontrolling interest
|
-
|
(2,727
|
)
|
-
|
-
|
-
|
(1,434
|
)
|
(4,161
|
)
|
||||||||||||||||||
Balance, March 31, 2016
|
$
|
36,334
|
$
|
110,750
|
$
|
853,280
|
$
|
(144,080
|
)
|
$
|
(113,666
|
)
|
$
|
1,536
|
$
|
744,154
|
Shareholders' Equity
|
||||||||||||||||||||||||||||
Accumulated
|
||||||||||||||||||||||||||||
Additional
|
Other
|
Non-
|
||||||||||||||||||||||||||
Common
|
Paid-in
|
Retained
|
Comprehensive
|
Treasury
|
controlling
|
|||||||||||||||||||||||
Stock
|
Capital
|
Earnings
|
Income (Loss)
|
Stock
|
interests
|
Total
|
||||||||||||||||||||||
Balance,
September 30, 2014
|
$
|
36,334
|
$
|
113,225
|
$
|
798,353
|
$
|
(66,817
|
)
|
$
|
(109,950
|
)
|
$
|
4,061
|
$
|
775,206
|
||||||||||||
Net income (loss)
|
-
|
-
|
23,335
|
-
|
-
|
(263
|
)
|
23,072
|
||||||||||||||||||||
Minimum pension liability
|
-
|
-
|
-
|
1,890
|
-
|
-
|
1,890
|
|||||||||||||||||||||
Translation adjustment
|
-
|
-
|
-
|
(67,930
|
)
|
-
|
(71
|
)
|
(68,001
|
)
|
||||||||||||||||||
Fair value of derivatives
|
-
|
-
|
-
|
(1,947
|
)
|
-
|
-
|
(1,947
|
)
|
|||||||||||||||||||
Total comprehensive income
|
(44,986
|
)
|
||||||||||||||||||||||||||
Stock-based compensation
|
-
|
4,564
|
-
|
-
|
-
|
-
|
4,564
|
|||||||||||||||||||||
Purchase of 212,626 shares of treasury stock
|
-
|
-
|
-
|
-
|
(9,890
|
)
|
-
|
(9,890
|
)
|
|||||||||||||||||||
Issuance of 328,927 shares of treasury stock
|
-
|
(6,934
|
)
|
-
|
-
|
10,574
|
-
|
3,640
|
||||||||||||||||||||
Cancellations of 32,739 shares of treasury stock
|
-
|
1,201
|
-
|
-
|
(1,201
|
)
|
-
|
-
|
||||||||||||||||||||
Dividends, $.26 per share
|
-
|
-
|
(8,610
|
)
|
-
|
-
|
-
|
(8,610
|
)
|
|||||||||||||||||||
Distributions to
noncontrolling interests
|
-
|
-
|
-
|
-
|
-
|
(95
|
)
|
(95
|
)
|
|||||||||||||||||||
Balance, March 31, 2015
|
$
|
36,334
|
$
|
112,056
|
$
|
813,078
|
$
|
(134,804
|
)
|
$
|
(110,467
|
)
|
$
|
3,632
|
$
|
719,829
|
Six Months Ended
|
||||||||
March 31,
|
||||||||
2016
|
2015
|
|||||||
Cash flows from operating activities:
|
||||||||
Net income
|
$
|
18,769
|
$
|
23,072
|
||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
32,158
|
31,888
|
||||||
Stock-based compensation expense
|
5,267
|
4,564
|
||||||
Change in deferred taxes
|
107
|
(10,962
|
)
|
|||||
Gain on sale of assets
|
(347
|
)
|
(65
|
)
|
||||
Unrealized gain on investments
|
(557
|
)
|
(500
|
)
|
||||
Trade name write-offs
|
-
|
4,842
|
||||||
Changes in working capital items
|
(6,635
|
)
|
9,615
|
|||||
(Increase) Decrease in other assets
|
(3,181
|
)
|
345
|
|||||
Decrease in other liabilities
|
(267
|
)
|
(4,607
|
)
|
||||
Increase in pension and postretirement benefits
|
6,751
|
3,273
|
||||||
Other, net
|
(174
|
)
|
(9,101
|
)
|
||||
Net cash provided by operating activities
|
51,891
|
52,364
|
||||||
Cash flows from investing activities:
|
||||||||
Capital expenditures
|
(23,946
|
)
|
(19,598
|
)
|
||||
Acquisitions, net of cash acquired
|
(6,081
|
)
|
-
|
|||||
Proceeds from sale of assets
|
1,121
|
690
|
||||||
Proceeds from sale of subsidiary
|
-
|
10,418
|
||||||
Restricted cash
|
-
|
(12,925
|
)
|
|||||
Net cash used in investing activities
|
(28,906
|
)
|
(21,415
|
)
|
||||
Cash flows from financing activities:
|
||||||||
Proceeds from long-term debt
|
22,055
|
27,388
|
||||||
Payments on long-term debt
|
(37,960
|
)
|
(52,815
|
)
|
||||
Proceeds from the exercise of stock options
|
1,798
|
3,778
|
||||||
Purchases of treasury stock
|
(8,209
|
)
|
(9,890
|
)
|
||||
Dividends
|
(9,646
|
)
|
(8,610
|
)
|
||||
Transaction with noncontrolling interests
|
(4,161
|
)
|
(95
|
)
|
||||
Net cash used in financing activities
|
(36,123
|
)
|
(40,244
|
)
|
||||
Effect of exchange rate changes on cash
|
274
|
(4,986
|
)
|
|||||
Net change in cash and cash equivalents
|
$
|
(12,864
|
)
|
$
|
(14,281
|
)
|
||
Three months ended March 31, 2015
|
Six months ended March 31, 2015
|
|||||||||||||||||||||||
Previously Reported
|
Adjustment
|
As Adjusted
|
Previously Reported
|
Adjustment
|
As Adjusted
|
|||||||||||||||||||
Consolidated Statements of Income
|
||||||||||||||||||||||||
Other income (deductions), net
|
$
|
(1,238
|
)
|
$
|
(883
|
)
|
$
|
(2,121
|
)
|
$
|
(1,673
|
)
|
$
|
(1,752
|
)
|
$
|
(3,425
|
)
|
||||||
Income before income taxes
|
13,805
|
(883
|
)
|
12,922
|
33,893
|
(1,752
|
)
|
32,141
|
||||||||||||||||
Income taxes
|
(4,377
|
)
|
282
|
(4,095
|
)
|
(9,629
|
)
|
560
|
(9,069
|
)
|
||||||||||||||
Net income
|
9,428
|
(601
|
)
|
8,827
|
24,264
|
(1,192
|
)
|
23,072
|
||||||||||||||||
Net income attributable to Matthews shareholders
|
9,576
|
(601
|
)
|
8,975
|
24,527
|
(1,192
|
)
|
23,335
|
||||||||||||||||
Comprehensive loss
|
(32,452
|
)
|
(601
|
)
|
(33,053
|
)
|
(43,794
|
)
|
(1,192
|
)
|
(44,986
|
)
|
||||||||||||
Earnings per share attributable to Matthews shareholders:
|
||||||||||||||||||||||||
Basic
|
0.29
|
(0.02
|
)
|
0.27
|
0.74
|
(0.03
|
)
|
0.71
|
||||||||||||||||
Diluted
|
0.29
|
(0.02
|
)
|
0.27
|
0.74
|
(0.04
|
)
|
0.70
|
Six months ended March 31, 2015
|
||||||||||||
Previously Reported
|
Adjustment
|
As Adjusted
|
||||||||||
Consolidated Statement of Cash Flows
|
||||||||||||
Net income
|
$
|
24,264
|
$
|
(1,192
|
)
|
23,072
|
||||||
Changes in working capital items
|
10,175
|
(560
|
)
|
9,615
|
||||||||
Net cash provided by operating activities
|
54,116
|
(1,752
|
)
|
52,364
|
||||||||
Net change in cash and cash equivalents
|
(12,529
|
)
|
(1,752
|
)
|
(14,281
|
)
|
March 31, 2016
|
September 30, 2015
|
|||||||||||||||||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||||||||||||||
Assets:
|
||||||||||||||||||||||||||||||||
Derivatives (1)
|
$
|
-
|
$
|
152
|
$
|
-
|
$
|
152
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||||||||||
Trading
securities |
19,001
|
-
|
-
|
19,001
|
18,444
|
-
|
-
|
18,444
|
||||||||||||||||||||||||
Total assets at
fair value |
$
|
19,001
|
$
|
152
|
$
|
-
|
$
|
19,153
|
$
|
18,444
|
$
|
-
|
$
|
-
|
$
|
18,444
|
||||||||||||||||
Liabilities:
|
||||||||||||||||||||||||||||||||
Derivatives (1)
|
$
|
-
|
$
|
5,898
|
$
|
-
|
$
|
5,898
|
$
|
-
|
$
|
3,686
|
$
|
-
|
$
|
3,686
|
||||||||||||||||
Total liabilities
at fair value |
$
|
-
|
$
|
5,898
|
$
|
-
|
$
|
5,898
|
$
|
-
|
$
|
3,686
|
$
|
-
|
$
|
3,686
|
||||||||||||||||
(1) Interest rate swaps are valued based on observable market swap rates and are classified within Level 2 of the fair value hierarchy.
|
March 31, 2016
|
September 30, 2015
|
|||||||
Raw Materials
|
$
|
48,599
|
$
|
48,636
|
||||
Work in process
|
37,330
|
32,567
|
||||||
Finished goods
|
83,375
|
90,220
|
||||||
$
|
169,304
|
$
|
171,423
|
Effective Date
|
Amount
|
Fixed Interest Rate
|
Interest Rate Spread at March 31, 2016
|
Maturity Date
|
||||||||||
June 2012
|
$
|
40,000
|
1.88%
|
|
1.75%
|
|
June 2022
|
|||||||
August 2012
|
35,000
|
1.74%
|
|
1.75%
|
|
June 2022
|
||||||||
September 2012
|
25,000
|
1.24%
|
|
1.75%
|
|
March 2017
|
||||||||
May 2014
|
25,000
|
1.35%
|
|
1.75%
|
|
May 2018
|
||||||||
November 2014
|
25,000
|
1.26%
|
|
1.75%
|
|
June 2018
|
||||||||
March 2015
|
25,000
|
1.49%
|
|
1.75%
|
|
March 2019
|
||||||||
September 2015
|
25,000
|
1.39%
|
|
1.75%
|
|
September 2020
|
||||||||
November 2015
|
25,000
|
1.32%
|
|
1.75%
|
|
November 2020
|
||||||||
December 2015
|
25,000
|
1.59%
|
|
1.75%
|
|
December 2020
|
||||||||
February 2016
|
25,000
|
0.99%
|
|
1.75%
|
|
February 2020
|
||||||||
February 2016
|
25,000
|
1.03%
|
|
1.75%
|
|
February 2022
|
Derivatives
|
March 31, 2016
|
September 30, 2015
|
||||||
Current assets:
|
||||||||
Other current assets
|
$
|
26
|
$
|
-
|
||||
Long-term assets:
|
||||||||
Other assets
|
126
|
-
|
||||||
Current liabilities:
|
||||||||
Other current liabilities
|
(1,465
|
)
|
(1,165
|
)
|
||||
Long-term liabilities:
|
||||||||
Other liabilities
|
(4,433
|
)
|
(2,521
|
)
|
||||
Total derivatives
|
$
|
(5,746
|
)
|
$
|
(3,686
|
)
|
||
|
|||||||||||||||||
Derivatives in Cash Flow Hedging Relationships
|
Location of Loss Recognized in Income on Derivative
|
Amount of
|
Amount of
|
||||||||||||||
Loss Recognized
|
Loss Recognized
|
||||||||||||||||
in Income
|
in Income
|
||||||||||||||||
on Derivatives
|
on Derivatives
|
||||||||||||||||
Three Months ended
March 31,
|
Six Months ended
March 31,
|
||||||||||||||||
2016
|
2015
|
2016
|
2015
|
||||||||||||||
Interest rate swaps
|
Interest expense
|
$
|
(746
|
)
|
$
|
(996
|
)
|
$
|
(1,576
|
)
|
$
|
(2,073
|
)
|
||||
Amount of Loss | ||||||||||||||||||
|
Reclassified from
|
|||||||||||||||||
Amount of
|
|
AOCI into
|
||||||||||||||||
|
Loss Recognized in
|
Location of Gain or (Loss) Reclassified From AOCI into Income (Effective Portion*)
|
Income
|
|||||||||||||||
Derivatives in Cash Flow Hedging Relationships
|
AOCI on Derivatives
|
(Effective Portion*)
|
||||||||||||||||
March 31, 2016
|
March 31, 2015
|
March 31, 2016
|
March 31, 2015
|
|||||||||||||||
Interest rate swaps
|
$
|
(2,218
|
)
|
$
|
(3,212
|
)
|
Interest expense
|
$
|
(961
|
)
|
$
|
(1,265
|
)
|
|||||
*There is no ineffective portion or amount excluded from effectiveness testing.
|
Weighted-
|
||||||||
average
|
||||||||
grant-date
|
||||||||
Shares
|
fair value
|
|||||||
Non-vested at September 30, 2015
|
570,567
|
$
|
33.66
|
|||||
Granted
|
224,125
|
51.91
|
||||||
Vested
|
(260,947
|
)
|
30.17
|
|||||
Expired or forfeited
|
(3,385
|
)
|
39.55
|
|||||
Non-vested at March 31, 2016
|
530,360
|
$
|
45.21
|
Weighted-
|
||||||||||||||||
Weighted-
|
average
|
Aggregate
|
||||||||||||||
average
|
remaining
|
intrinsic
|
||||||||||||||
Shares
|
exercise price
|
contractual term
|
value
|
|||||||||||||
Outstanding, September 30, 2015
|
337,938
|
$
|
39.19
|
|||||||||||||
Exercised
|
(47,834
|
)
|
37.59
|
|||||||||||||
Expired or forfeited
|
(98,745
|
)
|
37.33
|
|||||||||||||
Outstanding, March 31, 2016
|
191,359
|
40.56
|
0.6
|
$
|
2,089
|
|||||||||||
Exercisable, March 31, 2016
|
114,193
|
$
|
40.56
|
0.6
|
$
|
1,246
|
Weighted-average
|
||||||||
grant-date
|
||||||||
Non-vested shares
|
Shares
|
fair value
|
||||||
Non-vested at September 30, 2015
|
166,406
|
$
|
12.43
|
|||||
Expired or forfeited
|
(89,240
|
)
|
12.56
|
|||||
Non-vested at March 31, 2016
|
77,166
|
$
|
12.29
|
Six Months Ended March 31,
|
||||||||
2016
|
2015
|
|||||||
Expected volatility
|
20.7
|
%
|
22.2
|
%
|
||||
Dividend yield
|
1.0
|
%
|
1.0
|
%
|
||||
Average risk-free interest rate
|
1.7
|
%
|
1.7
|
%
|
||||
Average expected term (years)
|
2.1
|
1.8
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
March 31,
|
March 31,
|
|||||||||||||||
2016
|
2015
|
2016
|
2015
|
|||||||||||||
Net income attributable to Matthews shareholders
|
$
|
14,357
|
$
|
8,975
|
$
|
18,971
|
$
|
23,335
|
||||||||
Less: dividends and undistributed earnings
allocated to participating securities |
-
|
1
|
-
|
5
|
||||||||||||
Net income available to Matthews shareholders
|
$
|
14,357
|
$
|
8,974
|
$
|
18,971
|
$
|
23,330
|
||||||||
Weighted-average shares outstanding (in thousands):
|
||||||||||||||||
Basic shares
|
33,005
|
32,970
|
32,970
|
32,940
|
||||||||||||
Effect of dilutive securities
|
197
|
212
|
250
|
244
|
||||||||||||
Diluted shares
|
33,202
|
33,182
|
33,220
|
33,184
|
||||||||||||
Three months ended March 31,
|
||||||||||||||||
Pension
|
Other Postretirement
|
|||||||||||||||
2016
|
2015
|
2016
|
2015
|
|||||||||||||
Service cost
|
$
|
1,813
|
$
|
1,655
|
$
|
101
|
$
|
114
|
||||||||
Interest cost
|
2,406
|
2,145
|
211
|
221
|
||||||||||||
Expected return on plan assets
|
(2,407
|
)
|
(2,470
|
)
|
-
|
-
|
||||||||||
Amortization:
|
||||||||||||||||
Prior service cost
|
(46
|
)
|
(45
|
)
|
(49
|
)
|
(49
|
)
|
||||||||
Net actuarial loss
|
1,866
|
1,564
|
-
|
-
|
||||||||||||
Net benefit cost
|
$
|
3,632
|
$
|
2,849
|
$
|
263
|
$
|
286
|
Six months ended March 31,
|
||||||||||||||||
Pension
|
Other Postretirement
|
|||||||||||||||
2016
|
2015
|
2016
|
2015
|
|||||||||||||
Service cost
|
$
|
3,626
|
$
|
3,310
|
$
|
202
|
$
|
228
|
||||||||
Interest cost
|
4,812
|
4,290
|
422
|
442
|
||||||||||||
Expected return on plan assets
|
(4,814
|
)
|
(4,940
|
)
|
-
|
-
|
||||||||||
Amortization:
|
||||||||||||||||
Prior service cost
|
(92
|
)
|
(90
|
)
|
(98
|
)
|
(98
|
)
|
||||||||
Net actuarial loss
|
3,732
|
3,128
|
-
|
-
|
||||||||||||
Net benefit cost
|
$
|
7,264
|
$
|
5,698
|
$
|
526
|
$
|
572
|
Contributions
|
Pension
|
Other Postretirement
|
||||||
Contributions during the six months ended March 31, 2016:
|
||||||||
Supplemental retirement plan
|
$
|
362
|
$
|
-
|
||||
Other postretirement plan
|
-
|
672
|
||||||
Additional contributions expected in fiscal 2016:
|
||||||||
Supplemental retirement plan
|
$
|
387
|
$
|
-
|
||||
Other postretirement plan
|
-
|
336
|
Post-retirement benefit plans
|
Currency translation adjustment
|
Derivatives
|
Total
|
|||||||||||||||
Attributable to Matthews:
|
||||||||||||||||||
Balance, December 31, 2015
|
$
|
(42,372
|
)
|
$
|
(114,673
|
)
|
$
|
(666
|
)
|
$
|
(157,711
|
)
|
||||||
OCI before reclassification
|
-
|
15,412
|
(3,294
|
)
|
12,117
|
|||||||||||||
Amounts reclassified from AOCI
|
(a)
|
1,058
|
-
|
(b)
|
455
|
1,514
|
||||||||||||
Net current-period OCI
|
1,058
|
15,412
|
(2,839
|
)
|
13,631
|
|||||||||||||
Balance, March 31, 2016
|
$
|
(41,314
|
)
|
$
|
(99,261
|
)
|
$
|
(3,505
|
)
|
$
|
(144,080
|
)
|
||||||
Attributable to noncontrolling interest:
|
||||||||||||||||||
Balance, December 31, 2015
|
-
|
$
|
313
|
-
|
$
|
313
|
||||||||||||
OCI before reclassification
|
-
|
(1
|
)
|
-
|
(1
|
)
|
||||||||||||
Net current-period OCI
|
-
|
(1
|
)
|
-
|
(1
|
)
|
||||||||||||
Balance, March 31, 2016
|
-
|
$
|
312
|
-
|
$
|
312
|
Post-retirement benefit plans
|
Currency translation adjustment
|
Derivatives
|
Total
|
|||||||||||||||
Attributable to Matthews:
|
||||||||||||||||||
Balance, December 31, 2014
|
$
|
(38,726
|
)
|
$
|
(53,649
|
)
|
$
|
(610
|
)
|
$
|
(92,985
|
)
|
||||||
OCI before reclassification
|
-
|
(41,648
|
)
|
(1,744
|
)
|
(43,392
|
)
|
|||||||||||
Amounts reclassified from AOCI
|
(a)
|
965
|
-
|
(b)
|
608
|
1,573
|
||||||||||||
Net current-period OCI
|
965
|
(41,648
|
)
|
(1,136
|
)
|
(41,819
|
)
|
|||||||||||
Balance, March 31, 2015
|
$
|
(37,761
|
)
|
$
|
(95,297
|
)
|
$
|
(1,746
|
)
|
$
|
(134,804
|
)
|
||||||
Attributable to noncontrolling interest:
|
||||||||||||||||||
Balance, December 31, 2014
|
-
|
$
|
506
|
-
|
$
|
506
|
||||||||||||
OCI before reclassification
|
-
|
(61
|
)
|
-
|
(61
|
)
|
||||||||||||
Net current-period OCI
|
-
|
(61
|
)
|
-
|
(61
|
)
|
||||||||||||
Balance, March 31, 2015
|
-
|
$
|
445
|
-
|
$
|
445
|
(a) | Amounts were included in net periodic benefit cost for pension and other postretirement benefit plans (see Note 8). |
(b) | Amounts were included in interest expense in the periods the hedged item affected earnings (see Note 5). |
Post-retirement benefit plans
|
Currency translation adjustment
|
Derivatives
|
Total
|
|||||||||||||||
Attributable to Matthews:
|
||||||||||||||||||
Balance, September 30, 2014
|
$
|
(43,474
|
)
|
$
|
(104,604
|
)
|
$
|
(2,248
|
$
|
(150,326
|
)
|
|||||||
OCI before reclassification
|
-
|
5,343
|
(2,218
|
)
|
3,124
|
|||||||||||||
Amounts reclassified from AOCI
|
(a)
|
2,160
|
-
|
(b)
|
961
|
3,122
|
||||||||||||
Net current-period OCI
|
2,160
|
5,343
|
(1,257
|
)
|
6,246
|
|||||||||||||
Balance, March 31, 2015
|
$
|
(41,314
|
)
|
$
|
(99,261
|
)
|
$
|
(3,505
|
)
|
$
|
(144,080
|
)
|
||||||
Attributable to noncontrolling interest:
|
||||||||||||||||||
Balance, September 30, 2014
|
-
|
$
|
366
|
-
|
$
|
366
|
||||||||||||
OCI before reclassification
|
-
|
(54
|
)
|
-
|
(54
|
)
|
||||||||||||
Net current-period OCI
|
-
|
(54
|
)
|
-
|
(54
|
)
|
||||||||||||
Balance, March 31, 2015
|
-
|
$
|
312
|
-
|
$
|
312
|
Post-retirement benefit plans
|
Currency translation adjustment
|
Derivatives
|
Total
|
|||||||||||||||
Attributable to Matthews:
|
||||||||||||||||||
Balance, September 30, 2014
|
$
|
(39,651
|
)
|
$
|
(27,367
|
)
|
$
|
201
|
$
|
(66,817
|
)
|
|||||||
OCI before reclassification
|
-
|
(67,930
|
)
|
(3,212
|
)
|
(71,142
|
)
|
|||||||||||
Amounts reclassified from AOCI
|
(a)
|
1,890
|
-
|
(b)
|
1,265
|
3,155
|
||||||||||||
Net current-period OCI
|
1,890
|
(67,930
|
)
|
(1,947
|
)
|
(67,987
|
)
|
|||||||||||
Balance, March 31, 2015
|
$
|
(37,761
|
)
|
$
|
(95,297
|
)
|
$
|
(1,746
|
)
|
$
|
(134,804
|
)
|
||||||
Attributable to noncontrolling interest:
|
||||||||||||||||||
Balance, September 30, 2014
|
-
|
$
|
516
|
-
|
$
|
516
|
||||||||||||
OCI before reclassification
|
-
|
(71
|
)
|
-
|
(71
|
)
|
||||||||||||
Net current-period OCI
|
-
|
(71
|
)
|
-
|
(71
|
)
|
||||||||||||
Balance, March 31, 2015
|
-
|
$
|
445
|
-
|
$
|
445
|
(a) | Amounts were included in net periodic benefit cost for pension and other postretirement benefit plans (see Note 8). |
(b) | Amounts were included in interest expense in the periods the hedged item affected earnings (see Note 5). |
Amount reclassified from AOCI
|
||||||||||
Details about AOCI Components
|
Three months ended
March 31, 2016
|
Six months ended
March 31, 2016
|
Affected line item in the Statement of income
|
|||||||
Postretirement benefit plans
|
||||||||||
Prior service (cost) credit
|
$
|
95
|
(a)
|
$
|
190
|
|||||
Actuarial losses
|
(1,866
|
)
|
(a)
|
(3,732
|
)
|
|||||
(1,771
|
)
|
(b)
|
(3,542
|
)
|
Total before tax
|
|||||
(713
|
)
|
(1,382
|
)
|
Tax provision (benefit)
|
||||||
$
|
(1,058
|
)
|
$
|
(2,160
|
)
|
Net of tax
|
||||
Derivatives
|
||||||||||
Interest rate swap contracts
|
$
|
(746
|
)
|
$
|
(1,576
|
)
|
Interest expense
|
|||
(746
|
)
|
(b)
|
(1,576
|
)
|
Total before tax
|
|||||
(291
|
)
|
(615
|
)
|
Tax provision (benefit)
|
||||||
$
|
(455
|
)
|
$
|
(961
|
)
|
Net of tax
|
Amount reclassified from AOCI
|
||||||||||
Details about AOCI Components
|
Three months ended
March 31, 2015
|
Six months ended
March 31, 2015
|
Affected line item in the Statement of income
|
|||||||
Postretirement benefit plans
|
||||||||||
Prior service (cost) credit
|
$
|
94
|
(a)
|
$
|
188
|
|||||
Actuarial losses
|
(1,564
|
)
|
(a)
|
(3,128
|
)
|
|||||
(1,470
|
)
|
(b)
|
(2,940
|
)
|
Total before tax
|
|||||
(505
|
)
|
(1,050
|
)
|
Tax provision (benefit)
|
||||||
$
|
(965
|
)
|
$
|
(1,890
|
)
|
Net of tax
|
||||