Quarterly report pursuant to Section 13 or 15(d)

Segment Reporting

v3.7.0.1
Segment Reporting
 6 Months Ended
Jul. 01, 2017
Segment Reporting [Abstract]  
SEGMENT REPORTING

11.  SEGMENT REPORTING

For the six months ended July 2, 2016, the Company’s individual subsidiaries operated predominantly in a single industry as manufacturers and distributors of hydraulic components.  Given the similar nature of products offered for sale, the type of customers, the methods of distribution and how the Company was managed, the Company determined that it had only one operating and reporting segment for both internal and external reporting purposes.  With the acquisition of Enovation Controls on December 5, 2016, the Company re-evaluated the reportable operating segment presentation.  As of the date of the acquisition, the Company has two reportable segments: Hydraulics and Electronics. These segments are organized primarily based on the similar nature of products offered for sale, the types of customers served and the methods of distribution and are consistent with how the segments are managed, how resources are allocated and how information is used by the chief operating decision makers. As a result of the re-evaluation of reportable operating segments, financial information for HCT is presented in the Electronics segment as of the beginning of the 2016 fiscal year.

The Company evaluates performance and allocates resources based primarily on segment operating income. Certain costs were not allocated to the business segments as they are not used in evaluating the results of, or in allocating resources to, Sun’s segments. These costs are presented in the Corporate and other line item below. For the six months ended July 1, 2017, the unallocated costs included certain corporate costs not deemed to be allocable to all segments of $300 and acquisition-related costs including charges related to inventory step-up to fair value of $1,774 and amortization of acquisition-related intangible assets of $4,227. The accounting policies of Sun’s operating segments are the same as those used to prepare the accompanying consolidated financial statements.

The following table presents financial information by reportable segment:

 

 

 

Three months ended

 

 

Six months ended

 

 

 

July 1, 2017

 

 

July 2, 2016

 

 

July 1, 2017

 

 

July 2, 2016

 

Net sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

 

$

60,818

 

 

$

49,915

 

 

$

114,940

 

 

$

100,098

 

Electronics

 

 

28,517

 

 

 

894

 

 

 

55,748

 

 

 

1,739

 

 

 

$

89,335

 

 

$

50,809

 

 

$

170,688

 

 

$

101,837

 

Operating Income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

 

$

16,359

 

 

$

10,642

 

 

$

30,131

 

 

$

22,568

 

Electronics

 

 

6,419

 

 

 

(198

)

 

 

12,655

 

 

 

(238

)

Corporate and other

 

 

(2,077

)

 

 

—

 

 

 

(6,301

)

 

 

—

 

 

 

$

20,701

 

 

$

10,444

 

 

$

36,485

 

 

$

22,330

 

Depreciation and Amortization:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

 

$

2,241

 

 

$

2,386

 

 

$

4,529

 

 

$

4,780

 

Electronics

 

 

2,523

 

 

 

121

 

 

 

5,326

 

 

 

254

 

 

 

$

4,764

 

 

$

2,507

 

 

$

9,855

 

 

$

5,034

 

Capital Expenditures:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

 

$

1,465

 

 

$

1,493

 

 

$

2,076

 

 

$

2,435

 

Electronics

 

 

1,082

 

 

 

65

 

 

 

1,229

 

 

 

122

 

 

 

$

2,547

 

 

$

1,558

 

 

$

3,305

 

 

$

2,557

 

 

 

 

July 1, 2017

 

 

December 31, 2016

 

Total Assets:

 

 

 

 

 

 

 

 

Hydraulics

 

$

198,887

 

 

$

193,722

 

Electronics

 

 

270,406

 

 

 

251,055

 

Total

 

$

469,293

 

 

$

444,777

 

 

Geographic Region Information

Net sales are measured based on the geographic destination of sales. Tangible long-lived assets are shown based on the physical location of the assets and primarily include net property, plant and equipment:

 

 

 

Three months ended

 

 

Six months ended

 

 

 

July 1, 2017

 

 

July 2, 2016

 

 

July 1, 2017

 

 

July 2, 2016

 

Net sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Americas

 

$

52,705

 

 

$

23,402

 

 

$

99,993

 

 

$

48,117

 

Europe/Middle East/Africa

 

 

19,229

 

 

 

15,803

 

 

 

39,329

 

 

 

31,480

 

Asia/Pacific

 

 

17,401

 

 

 

11,604

 

 

 

31,366

 

 

 

22,240

 

Total

 

$

89,335

 

 

$

50,809

 

 

$

170,688

 

 

$

101,837

 

 

 

 

 

July 1, 2017

 

 

December 31, 2016

 

Tangible long-lived assets

 

 

 

 

 

 

 

 

Americas

 

$

69,007

 

 

$

71,802

 

Europe/Middle East/Africa

 

 

7,340

 

 

 

7,116

 

Asia/Pacific

 

 

1,903

 

 

 

1,597

 

Total

 

$

78,250

 

 

$

80,515