Notes to Consolidated Financial Statements (Unaudited)
June 30
, 201
7
(Dollars in T
housands)
(1)
Basis of Presentation and Consolidation
As used herein, the terms “Company,” “Landauer,” “we,” “us,” and “our” refer collectively to Landauer, Inc. and its subsidiaries through which
its
various businesses are conducted.
The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the instructions to Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.
The consolidated financial statements include the accounts of the Company, its subsidiaries and variable interest entities in which the Company has a controlling financial interest. All intercompany balances and transactions have been eliminated in consolidation. Entities in which the Company does not have a controlling financial interest, but is considered to have significant influence, are accounted for on the equity method.
The preparation of the interim consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
We believe that we have included all normal recurring adjustments necessary for a fair presentation of the results for the interim period. Operating results for the
three and
nine
months
ended
June 30
, 201
7
are not necessarily indicative of the results that may be expected for the fiscal year ending September 30, 201
7
.
These
consolidated
financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 201
6
(the “Form 10-K”) and other financial information filed with the Securities and Exchange Commission (the “SEC”). The September 30, 201
6
balance sheet data was derived from audited financial statements but does not include all disclosures required by U.S. GAAP.
The accounting policies followed by the Company are set forth in the Form 10-K, and there have been no changes to the accounting policies for the
nine
-
month period ended
June 30
, 201
7
.
(2)
Recent Accounting Pronouncements
Accounting Standards Adopted
In June 2014, the
Financial Accounting Standards Board (“
FASB
”)
issued new guidance on accounting for share-based payments requiring a specific performance target to be achieved in order for employees to become eligible to vest in the awards when that performance target may be achieved after the requisite service period for the award. This update further clarifies that compensation cost should 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 for which the requisite service has already been rendered. The Company adopted the updated standard in the first quarter of fiscal 2017 with no significant impact on its financial statements.
In April 2015, the FASB issued new guidance on a customer’s accounting for fees paid in a cloud computing arrangement (
“
CCA
”
). Under the new standard, customers will apply the same criteria as vendors to determine whether a CCA contains a software license or is solely a service contract. The Company adopted the updated standard prospectively in the first quarter of fiscal 2017 with no significant impact on its financial statements.
Accounting Standards Not Yet Adopted
In May 2014, the
FASB
issued new guidance for recognizing revenue from contracts with customers, which provides a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will supersede most current revenue recognition guidance. In
July
2015, the FASB
deferred
the effective date of the new revenue standard
by one year
. Public companies would
now
be required to adopt the new guidance for fiscal years
,
and interim periods within those
fiscal
years
,
beginning after December 15, 2017
.
The FASB decided to allow earlier
adoption
of the new revenue standard, but not earlier than the original effective date
.
This guidance is effective for the Company in the first quarter of fiscal 2019.
The Company is currently evaluating the impact that adoption of this guidance will have on its
results of operations, financial position
and
liquidity
.
To date, the Company has formed a committee to evaluate the impact and
is
in the initial stages of evaluation.
In July 2015, the FASB issued new guidance on simplifying the measurement of inventory. This update requires a company to measure inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. This guidance is effective for the Company in the first quarter of fiscal 2018 and should be applied prospectively with early adoption permitted. The Company is currently evaluating the impact this guidance will have on its results of operations, financial position and liquidity.
In November 2015, the FASB issued new guidance on the presentation of deferred income taxes. This update requires a company to present deferred tax liabilities and assets as noncurrent in a classified statement of financial position rather than the current requirement to separate deferred income tax liabilities and assets into current and noncurrent amounts. This guidance is effective for the Company in the first quarter of fiscal 2018, with early adoption permitted. The Company does not expect the adoption of this guidance will have a material impact on its results of operations, financial position and liquidity.
In February 2016, the FASB issued
new
guidance on the accounting treatment for leases. This guidance will require all leases with durations greater than twelve months to be recognized on the balance sheet of the lessee. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Classification will be based on criteria that are largely similar to those applied in current lease accounting, but without explicit bright lines. This guidance is effective for the Company in the first quarter of fiscal 2020, although early adoption is permitted. The Company is currently evaluating the impact that adoption of this guidance will have on its results of operations, financial position and liquidity.
In March 2016, the FASB issued new guidance to improve the accounting for share-based payments. This standard makes several modifications to Topic 718 related to the accounting for forfeitures, employer tax withholding on share-based compensation and the financial statement presentation of excess tax benefits or deficiencies. The guidance also clarifies the statement of cash flows presentation for certain components of share-based awards. The standard is effective for the Company in the first quarter of fiscal 2018, although early adoption is permitted. The Company is currently evaluating the impact that adoption of this guidance will have on its results of operations, financial position and liquidity.
In June 2016, the FASB issued new guidance to introduce a new model for recognizing credit losses on financial
instruments based on an estimate of current expected credit losses. The update replaces the incurred loss impairment
methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a
broader range of reasonable and supportable information to inform credit loss estimates. The update is effective for the
Company in the first quarter of fiscal 2020, although early adoption is permitted. The Company is currently evaluating
the effect that this update will have on its financial statements and related disclosures.
In August 2016, the FASB issued
an
Accounting Standards Update (“
ASU
”)
to provide cash flow statement guidance for certain cash receipts and payments
,
including (a) debt prepayment or extinguishment costs; (b) contingent consideration payments made after a business combination; (c) insurance settlement proceeds; (d) distributions from equity method investees; (e) beneficial interests in securitization transactions and (f) application of the predominance principle for cash receipts and payments with aspects of more than one class of cash flows.
The update is effective for the Company i
n
the first quarter of fiscal
2018. The Company is currently evaluating the effect that this update will have on its financial statements and related
disclosures.
In November 2016, the FASB issued
amendments to current gu
idance related to the
classification and
presentation of
changes in
restricted cash in the Statement of Cash Flows.
The update is effective for the Company in the first quarter of fiscal 2019, and early adoption is permitted. The Company is currently evaluating the impact that this update will have on its financial statements and related disclosures.
No other new accounting pronouncement issued or effective during the fiscal year had, or is expected to have, a material impact on the Consolidated Financial Statements.
(3)
Fair Value Measurements
The Company
estimate
s
the
fair value
of
assets and liabilities
in accordance with
the framework established
by
the
authoritative guidance for fair value measurements
.
The framework is based on the inputs used in valuation, gives the highest priority to quoted prices in active markets and requires that observable inputs be used in
the valuations when available.
The disclosure of fair value estimates in the fair value accounting guidance hierarchy is based on whether the significant inputs int
o the valuation are observable.
In determining the level of the hierarchy in which the estimate is disclosed, the highest priority is given to unadjusted quoted prices in active markets and the lowest priority to unobservable inputs that reflect the Company’s
significant market assumptions.
The level in the fair value hierarchy within which the fair value measurement is reported is based on the lowest level input that is significant to t
he measurement in its entirety.
The three levels of the hierarchy are as follows:
|
·
|
|
Level 1
– Unadjusted
quoted prices in active markets for identical assets
or
liabilities
t
hat the Company has the ability to access
as of the reporting date
.
|
|
·
|
|
Level 2
– I
nputs other than quoted prices
included within Level 1 that are directly
observable for the asset or liability
or indirectly observable through corroboration with observable market data.
|
|
·
|
|
Level 3
– Unobservable
inputs
for the asset or liability used to measure fair value that
reflect
the Company’s
own assumptions
about the assumptions
market participants would use in pricing the asset or liability.
|
Financial assets measured at fair value on a recurring basis are summarized below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurements at June 30, 2017
|
(Dollars in Thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
Asset Category
|
|
|
|
|
|
|
|
|
Cash equivalents
|
$
|
554
|
|
$
|
-
|
|
$
|
-
|
Mutual funds
|
|
4,397
|
|
|
-
|
|
|
-
|
Total financial assets at fair value
|
$
|
4,951
|
|
$
|
-
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurements at September 30, 2016
|
(Dollars in Thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
Asset Category
|
|
|
|
|
|
|
|
|
Cash equivalents
|
$
|
453
|
|
$
|
-
|
|
$
|
-
|
Mutual funds
|
|
3,687
|
|
|
-
|
|
|
-
|
Total financial assets at fair value
|
$
|
4,140
|
|
$
|
-
|
|
$
|
-
|
Following is a description of each category in the fair value hierarchy and the financial assets and liabilities of the Company that were included in each category at
June 30
, 201
7
and September 30, 201
6
, measured on a recurring basis.
The Level 1 financial assets were comprised of investments in trading securities, which are reported in other long-term assets. The investments are held in a Rabbi trust for benefits under the Company’s deferred compensation plan. Under the plan, participants designate investment options to serve as the basis for measurement of the notional value of their accounts. The investments include a money market fund and mutual funds that are publicly traded. The fair values of the shares or underlying securities of these funds are based on quoted market prices.
The Company’s long
-
term debt is classified as Level 2. The carrying amount of the Company’s long-term debt
is the
approximated fair value
,
as the stated interest rates were variable in rela
tion to prevailing market rates
.
(4)
Income per Common Share
Basic net
income
per share was computed by dividing net
income
available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. Diluted net
income
per share was computed by dividing net
income
available to common stockholders for the period by the weighted average number of shares of common stock that would have been outstanding assuming dilution from stock-based compensation awards during the period.
The following table sets forth the computation of net income per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Nine Months Ended
June 30,
|
(Dollars in Thousands, Except per Share)
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Basic Net Income per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributed to Landauer, Inc.
|
|
$
|
6,400
|
|
$
|
7,265
|
|
$
|
15,976
|
|
$
|
15,187
|
Less: Income allocated to unvested restricted stock
|
|
|
15
|
|
|
20
|
|
|
53
|
|
|
59
|
Net income available to common stockholders
|
|
$
|
6,385
|
|
$
|
7,245
|
|
$
|
15,923
|
|
$
|
15,128
|
Basic weighted average shares outstanding
|
|
|
9,585
|
|
|
9,531
|
|
|
9,562
|
|
|
9,523
|
Net income per share - Basic
|
|
$
|
0.67
|
|
$
|
0.76
|
|
$
|
1.67
|
|
$
|
1.59
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted Net Income per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributed to Landauer, Inc.
|
|
$
|
6,400
|
|
$
|
7,265
|
|
$
|
15,976
|
|
$
|
15,187
|
Less: Income allocated to unvested restricted stock
|
|
|
15
|
|
|
20
|
|
|
53
|
|
|
59
|
Net income available to common stockholders
|
|
$
|
6,385
|
|
$
|
7,245
|
|
$
|
15,923
|
|
$
|
15,128
|
Basic weighted average shares outstanding
|
|
|
9,585
|
|
|
9,531
|
|
|
9,562
|
|
|
9,523
|
Effect of dilutive securities
|
|
|
21
|
|
|
33
|
|
|
33
|
|
|
32
|
Diluted weighted averages shares outstanding
|
|
|
9,606
|
|
|
9,564
|
|
|
9,595
|
|
|
9,555
|
Net income per share - Diluted
|
|
$
|
0.66
|
|
$
|
0.76
|
|
$
|
1.66
|
|
$
|
1.58
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends paid per share
|
|
$
|
0.275
|
|
$
|
0.275
|
|
$
|
0.83
|
|
$
|
0.83
|
On
May 2
, 201
7
, the Company declared a regular quarterly cash dividend in the amount of
$0.275
per share. The dividends were paid on
July 6
, 201
7
to shareholders of record as of
June
1
6
, 201
7
.
(5)
Employee Benefit Plans
The components of net periodic benefit cost for pension and other benefits were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension Benefits
|
Three Months Ended
June 30,
|
|
Nine Months Ended
June 30,
|
(Dollars in Thousands)
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Interest cost
|
$
|
352
|
|
$
|
392
|
|
$
|
1,057
|
|
$
|
1,177
|
Expected return on plan assets
|
|
(388)
|
|
|
(373)
|
|
|
(1,163)
|
|
|
(1,120)
|
Amortization of net loss
|
|
190
|
|
|
141
|
|
|
570
|
|
|
422
|
Net periodic benefit cost
|
$
|
154
|
|
$
|
160
|
|
$
|
464
|
|
$
|
479
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Benefits
|
Three Months Ended
June 30,
|
|
Nine Months Ended
June 30,
|
(Dollars in Thousands)
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Service cost
|
$
|
16
|
|
$
|
15
|
|
$
|
48
|
|
$
|
45
|
Interest cost
|
|
9
|
|
|
10
|
|
|
26
|
|
|
29
|
Amortization of net gain
|
|
-
|
|
|
(3)
|
|
|
-
|
|
|
(11)
|
Net periodic benefit cost
|
$
|
25
|
|
$
|
22
|
|
$
|
74
|
|
$
|
63
|
The Company, under the IRS minimum funding standards, has
no
required contributions to make to its defined benefit pension plan during fiscal 201
7
.
The Company
sponsors a
401(k)
r
etirement
s
avings
p
lan
covering substantially all
of the
U.S. full-time
employees
in the Company’s Radiation Measurement segment
as well as substantially all of the
employees in the
Company’s Medical Physics
segment, and prior to its divestiture, the Medical Products segment
. The Company also maintains
a supplemental defined contribution plan for certain executives, which
allows participating executives to make voluntary deferrals and
provides for employer contributions at the discretion of the Company.
Amounts expensed for Company contributions under these plans during the
three
months ended
June 30
, 201
7
and 201
6
were
$
483
and
$
494
, respectively.
Amounts expensed for Company contributions under these plans during the
nine
months ended
June 30
, 201
7
and 201
6
were
$
1
,514
and
$
1,412
, respectively.
(6)
Goodwill and Intangible Assets
Changes in the carrying amount of goodwill
,
by reportable segment
,
for the
nine
months ended
June 30
,
201
7
were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in Thousands)
|
|
Radiation Measurement
|
|
Medical
Physics
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of September 30, 2016
|
|
$
|
11,196
|
|
$
|
22,611
|
|
|
$
|
33,807
|
Currency translation adjustment
|
|
|
109
|
|
|
-
|
|
|
|
109
|
Balance as of June 30, 2017
|
|
$
|
11,305
|
|
$
|
22,611
|
|
|
$
|
33,916
|
The Company
ha
d
no
accumulated impairment losses as of
June 30
, 201
7
and Septem
ber
30,
2016
.
Intangible assets consisted of the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2017
|
(Dollars in Thousands)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying Amount
|
Customer lists
|
|
$
|
17,108
|
|
$
|
11,237
|
|
$
|
5,871
|
Trademarks and tradenames
|
|
|
133
|
|
|
-
|
|
|
133
|
Licenses and patents
|
|
|
3,508
|
|
|
910
|
|
|
2,598
|
Other intangibles
|
|
|
557
|
|
|
557
|
|
|
-
|
Intangible assets
|
|
$
|
21,306
|
|
$
|
12,704
|
|
$
|
8,602
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2016
|
(Dollars in Thousands)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying Amount
|
Customer lists
|
|
$
|
16,982
|
|
$
|
10,436
|
|
$
|
6,546
|
Trademarks and tradenames
|
|
|
133
|
|
|
-
|
|
|
133
|
Licenses and patents
|
|
|
3,397
|
|
|
779
|
|
|
2,618
|
Other intangibles
|
|
|
557
|
|
|
557
|
|
|
-
|
Intangible assets
|
|
$
|
21,069
|
|
$
|
11,772
|
|
$
|
9,297
|
Identifiable intangible assets with finite lives are amortized over their estimated useful lives. Intangible asset amortization expense was
$
388
and $
1,159
for the three
and
nine
months ended
June 30
, 201
7, respectively,
and
was
$
453
and
$
1,576
for the three and
nine
months ended
June 30
,
201
6
, respectively
.
(7)
Accumulated Other Comprehensive Loss
Accumulated elements of other comprehensive loss, net of tax, are included in the stockholders’ equity section of the condensed consolidated balance sheets. Changes in each component for the
nine
months ended
June 30
, 2017
and 201
6
are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in Thousands)
|
Foreign Currency Translation Adjustments
|
|
Unrealized Gains and Losses on Available-for-Sale Securities
|
|
Pension and Postretirement Plans
|
|
Comprehensive (Loss) Income
|
Balance at September 30, 2016
|
$
|
(4,696)
|
|
$
|
-
|
|
$
|
(10,570)
|
|
$
|
(15,266)
|
Other comprehensive loss before reclassifications
|
|
(871)
|
|
|
-
|
|
|
-
|
|
|
(871)
|
Amounts reclassified from accumulated other comprehensive income
|
|
-
|
|
|
-
|
|
|
357
|
|
|
357
|
Net current period other comprehensive (loss) income
|
|
(871)
|
|
|
-
|
|
|
357
|
|
|
(514)
|
Balance at June 30, 2017
|
$
|
(5,567)
|
|
$
|
-
|
|
$
|
(10,213)
|
|
$
|
(15,780)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in Thousands)
|
Foreign Currency Translation Adjustments
|
|
Unrealized Gains and Losses on Available-for-Sale Securities
|
|
Pension and Postretirement Plans
|
|
Comprehensive (Loss) Income
|
Balance at September 30, 2015
|
$
|
(5,468)
|
|
$
|
259
|
|
$
|
(8,532)
|
|
$
|
(13,741)
|
Other comprehensive income before reclassifications
|
|
1,456
|
|
|
147
|
|
|
-
|
|
|
1,603
|
Amounts reclassified from accumulated other comprehensive (loss) income
|
|
-
|
|
|
(334)
|
|
|
257
|
|
|
(77)
|
Net current period other comprehensive (loss) income
|
|
1,456
|
|
|
(187)
|
|
|
257
|
|
|
1,526
|
Balance at June 30, 2016
|
$
|
(4,012)
|
|
$
|
72
|
|
$
|
(8,275)
|
|
$
|
(12,215)
|
The tables below present the impact on net income of significant amounts reclassified out of each component of accumulated other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension and Postretirement Plans
(1)
|
Three Months Ended
June 30,
|
|
Nine Months Ended
June 30,
|
(Dollars in Thousands)
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Amortization of net loss
|
$
|
190
|
|
$
|
137
|
|
$
|
570
|
|
$
|
410
|
Total before tax
|
|
190
|
|
|
137
|
|
|
570
|
|
|
410
|
Provision for income taxes
|
|
71
|
|
|
52
|
|
|
213
|
|
|
153
|
Total net of tax
|
$
|
119
|
|
$
|
85
|
|
$
|
357
|
|
$
|
257
|
(1)
These accumulated other comprehensive loss components are included in the computation of net periodic benefit costs (refer to Note 5 of the Notes to Consolidated Financial Statements for additional details regarding employee benefit plans).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized Gains and Losses on Available-for-Sale Securities
|
Three Months Ended
June 30,
|
|
Nine Months Ended
June 30,
|
(Dollars in Thousands)
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Realized gains on available-for-sale securities into earnings
(1)
|
$
|
-
|
|
$
|
(288)
|
|
$
|
-
|
|
$
|
(393)
|
Total before tax
|
|
-
|
|
|
(288)
|
|
|
-
|
|
|
(393)
|
Provision for income taxes
(2)
|
|
-
|
|
|
(43)
|
|
|
-
|
|
|
(59)
|
Total net of tax
|
$
|
-
|
|
$
|
(245)
|
|
$
|
-
|
|
$
|
(334)
|
(1)
This amount is reported in Interest
E
xpense, net on the Consolidated Statements of Operations
(2)
This amount is reported in Income
T
ax
E
xpense
(Benefit)
on the Consolidated Statements of Operations
(8)
Income Taxes
The effective tax rates for the three months ended
June
3
0
, 2017 and 2016 were
27.5
%
and
31.3
%
, respectively. The
de
crease in the effective tax rate was primarily due to
the mix of taxable earnings between jurisdictions with differing tax rates and the release of uncertain tax positions relative to pretax earnings.
The effective tax rates for the
nine
months ended
June 30
, 2017 and 2016 were
3
2
.5%
and
31
.
2
%
, respectively. The increase in the effective tax rate was primarily due to the mix of earnings between jurisdictions with differing tax rates and tax law changes that impacted
the timing of recognition of certain credits in
the prior year. The Company believes it is reasonably possible that
$
135
of unrecognized tax benefits will be realized in fiscal year 201
8
.
(9)
Segment Information
In fiscal year 2017, t
he Company is organized into
two
reportable business segments:
Radiation Measurement
and
Medical Physics
.
As disclosed in
the Form 10-K for the fiscal period ended September 30, 2016
, the
Medical Products
business
was divested in May 2016
; accordingly, there were
no
reportable
revenues and operating income for the three
and
nine
month period
s
ended
June 30
, 201
7
for
th
at
reportable segment.
These segments reflect the manner in which the Company’s businesses are currently managed and represent an aggregation of services
and products
based on type of customer
and
how the business
es are
marketed.
For more information regarding the
nature of
the
Company’s
services and products
, see
N
ote 1
6
of
the N
otes to
C
onsolidated
F
inancial
S
tatements in the
Form 10-K
.
The following tables summarize financial information for each reportable segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Nine Months Ended
June 30,
|
(Dollars in Thousands)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Revenues by segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
Radiation Measurement
|
|
$
|
29,594
|
|
$
|
27,492
|
|
$
|
85,918
|
|
$
|
77,716
|
Medical Physics
|
|
|
10,294
|
|
|
9,562
|
|
|
30,664
|
|
|
28,948
|
Medical Products
|
|
|
-
|
|
|
800
|
|
|
-
|
|
|
5,802
|
Consolidated revenues
|
|
$
|
39,888
|
|
$
|
37,854
|
|
$
|
116,582
|
|
$
|
112,466
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Nine Months Ended
June 30,
|
(Dollars in Thousands)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Operating income (loss) by segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
Radiation Measurement
|
|
$
|
12,138
|
|
$
|
10,294
|
|
$
|
34,779
|
|
$
|
29,161
|
Medical Physics
|
|
|
789
|
|
|
756
|
|
|
2,140
|
|
|
2,452
|
Medical Products
|
|
|
-
|
|
|
141
|
|
|
-
|
|
|
1,063
|
Corporate
|
|
|
(4,344)
|
|
|
(3,478)
|
|
|
(13,085)
|
|
|
(11,494)
|
Consolidated operating income
|
|
$
|
8,583
|
|
$
|
7,713
|
|
$
|
23,834
|
|
$
|
21,182
|
|
|
|
|
|
|
|
(Dollars in Thousands)
|
|
June 30,
2017
|
|
September 30,
2016
|
Segment assets:
|
|
|
|
|
|
|
Radiation Measurement
|
|
$
|
165,720
|
|
$
|
160,560
|
Medical Physics
|
|
|
48,081
|
|
|
43,174
|
Eliminations
|
|
|
(15,635)
|
|
|
(12,918)
|
Consolidated assets
|
|
$
|
198,166
|
|
$
|
190,816
|
(10)
Related Party Transactions
The Company has a minority interest in Yamasato, Fujiwara, Higa & Associates, Inc. doing business as Aquila. The Company provides dosimetry parts to Aqu
ila for its military contract
.
The Company also has a
50%
equity interest in
Nagase-Landauer, Ltd. (“Nagase”), a radiation measurement company in Japan.
The sales to and purchases from Aquila were as follows
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Nine Months Ended
June 30,
|
(Dollars in Thousands)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Sales to Aquila
|
|
$
|
3,347
|
|
$
|
2,653
|
|
$
|
8,848
|
|
$
|
3,067
|
Purchases from Aquila
|
|
|
128
|
|
|
201
|
|
|
232
|
|
|
405
|
Balance sheet items
associated with Aquila
were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in Thousands)
|
|
June 30,
2017
|
|
September 30,
2016
|
Amounts in accounts receivable
|
|
$
|
3,439
|
|
$
|
1,910
|
Amounts in accounts payable
|
|
|
193
|
|
|
320
|
The sales to and purchases from Nagase were as
follows
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Nine Months Ended
June 30,
|
(Dollars in Thousands)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Sales to Nagase
|
|
$
|
961
|
|
$
|
1,180
|
|
$
|
3,204
|
|
$
|
3,474
|
Purchases from Nagase
|
|
|
58
|
|
|
123
|
|
|
687
|
|
|
817
|
Balance sheet items
associated with Nagase
were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in Thousands)
|
|
June 30,
2017
|
|
September 30,
2016
|
Amounts in accounts receivable
|
|
$
|
117
|
|
$
|
288
|
Amounts in accounts payable
|
|
|
5
|
|
|
23
|
(1
1
)
Subsequent Event
On July 13, 2017, the Company entered into a Second Amended and Restated Credit Agreement (the “Amended Credit Agreement”)
that amends and restates in its entirety the Amended and Restated Credit Agreement dated as of August 2, 2013, as amended by the First Amendment to Amended and Restated Credit Agreement dated as of June 30, 2014 (the “Existing Credit Agreement”).
The Amended Credit Agreement replaced the Existing Credit Agreement that contained substantially similar terms but decreased the revolving loan facility amount from
$175
.0
million to
$125
.0
million and extended the maturity date from
August 2, 2018
to
July 13, 2022
. The Amended Credit Agreement also added Landauer Europe as a borrower entity.
Similar to the Existing Credit Agreement, the Amended Credit Agreement contains customary representations and covenants, including financial covenants that the Company will maintain a fixed charge coverage ratio and leverage ratio within certain levels as defined in the Amended Credit Agreement.