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Segments | 12 Months Ended
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Sep. 30, 2017
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] |
Segments | Segments Aircraft Controls. We design, manufacture and integrate primary and secondary flight controls for military and commercial aircraft and provide aftermarket support. Our systems are used on both development and production programs in large commercial transports, supersonic fighters, multi-role military aircraft, business jets and rotorcraft. We also supply ground-based navigation aids. We are currently working on the KC-46 military air refueling tanker on the military side, and the Airbus A350XWB, COMAC C919 and the Embraer E-Jet E2 family on the commercial side. Typically development programs require concentrated periods of research and development by our engineering teams, while production programs are generally long-term manufacturing efforts that extend for as long as the aircraft builder receives new orders. In the past few years, a number of significant programs have begun to transition from the development phase to initial low-rate production, including the Lockheed Martin F-35 Joint Strike Fighter on the military side and the Boeing 787 on the commercial side. In terms of mature production programs, our large military programs include the F/A-18E/F Super Hornet, the V-22 Osprey tiltrotor and the Black Hawk UH-60/Seahawk SH-60 helicopter, while our large commercial production programs include the full line of Boeing 7-series aircraft, Airbus A330 and A380 and a variety of business jets. Aftermarket sales, which represented 27%, 29% and 30% of 2017, 2016 and 2015 sales, respectively, for this segment consist of the maintenance, repair, overhaul and parts supply for both military and commercial aircraft. Further, we sell spare parts and line replaceable units to both military and commercial customers that they store throughout the world in order to minimize down time. Space and Defense Controls. We provide controls for satellites, space vehicles, launch vehicles, armored combat vehicles, tactical and strategic missiles, security and surveillance and other defense applications. We design, manufacture and integrate commercial and military satellite positioning controls. Propulsion components and systems accelerate the spacecraft for orbit-insertion, station keeping, and attitude control. Mission specific actuation mechanisms control solar array panels and antennas. We also design, manufacture and integrate steering and propulsion controls for space launch vehicles, such as the Atlas, Delta and Ariane platforms. Additionally, we design and manufacture spaceflight electronics and software. We are also developing new control products and systems for a variety of programs related to manned spaceflight including: NASA's new Space Launch System, Multi-Purpose Crew Vehicle and Soft Capture System. In addition, we design controls for gun aiming, stabilization and automatic ammunition loading for armored combat vehicles for a variety of domestic and international customers. We also design controls for steering tactical and strategic missiles including: Lockheed Martin's Hellfire®, the U.S. National Missile Defense Agency's Ballistic Missile Defense initiatives and Raytheon's TOW and Trident missiles. We also design, build and integrate weapons stores management systems for light attack aerial reconnaissance, ground and sea platforms, as well as build high power, quiet controls for naval surface ships and submarines such as the US Virginia Class. Our sensor and surveillance products are used in both military and commercial applications such as electrical grid and other critical infrastructure protection applications. Industrial Systems. Our Industrial Systems segment serves a global customer base across a variety of markets. We design, manufacture and integrate systems for industrial automation customers for applications in injection and blow molding machinery, metal forming presses and heavy industry in steel and aluminum production. Our systems allow for precise controls of critical parameters in the industrial manufacturing processes, using both hydraulic and electric technology. Other industrial automation applications we serve include material handling and paper mills. In the energy market, we supply solutions for power generation applications which allow for precise control and greater safety of fuel metering and guide vane positioning on steam and gas turbines. We also design and manufacture high reliability systems and components for applications in oil and gas exploration and production, including downhole drilling, topside and subsea environments, as well as electric pitch controls and blade monitoring systems for wind turbines. We supply electromechanical motion simulation bases for the flight simulation and training applications, as well as medical training simulators. We also supply custom test systems and controls for automotive, structural and fatigue testing. Components. Our Components segment serves many of the same markets as our other segments. Our Components segment’s largest product categories include slip rings and fiber optic rotary joints, motors, and infusion and enteral pumps and associated sets. Slip rings and fiber optic rotary joints use sliding contacts and optical technology to allow unimpeded rotation while delivering power and data through a rotating interface. They come in a range of sizes that allow them to be used in many applications, including diagnostic imaging CT scan medical equipment, blade de-icing and data transfer for rotorcraft, remotely operated vehicles and floating platforms for offshore oil exploration, surveillance cameras, forward-looking infrared camera installations and radar pedestals, satellites, missiles and wind turbines. Our motors are used in an equally broad range of solutions, many of which are the same as for slip rings. We design and manufacture a series of fractional horsepower brushless motors that provide extremely low acoustic noise and reliable long life operation, with the largest program being sleep apnea equipment. Industrial customers use our motors for material handling and electric pumps. Military programs use our motors for gimbals, missiles and radar pedestals. Infusion therapy products include infusion pumps and associated administration sets. They offer IV, intra-arterial, subcutaneous or epidural flow of fluids and precise medicine delivery and can be applied to many applications, including hydration, nutrition, patient-controlled analgesia, local anesthesia, chemotherapy and antibiotics. Enteral clinical nutrition products include a complete line of portable and stationary pumps along with disposable sets. They are designed for ease of use and mobility. Medical customers use our enteral feeding products in the delivery of enteral nutrition for patients in their own homes, hospitals and long-term care facilities. Our Components’ segment's other product lines include ultrasonic and optical sensors and surgical hand pieces used in medical applications, electromechanical actuators for military, aerospace and commercial applications, fiber optic modems that provide electrical-to-optical conversion of communication and data signals, avionic instrumentation, subsea navigation and control systems, acoustic sensors and sonars for energy and marine applications including remotely-operated underwater vehicles and optical switches and resolvers. Segment information and reconciliations to consolidated amounts are as follows:
|  | 2017 |  | 2016 |  | 2015
Net sales: |  |  |  |  |  |
Aircraft Controls |  | $ | 1,124,885 |  |  | $ | 1,063,718 |  |  | $ | 1,086,547 |
Space and Defense Controls |  | 394,264 |  |  | 366,091 |  |  | 381,444 |
Industrial Systems |  | 477,325 |  |  | 514,984 |  |  | 521,505 |
Components |  | 501,050 |  |  | 467,144 |  |  | 536,036 |
Net sales |  | $ | 2,497,524 |  |  | $ | 2,411,937 |  |  | $ | 2,525,532 |
Operating profit: |  |  |  |  |  |
Aircraft Controls |  | $ | 114,016 |  |  | $ | 98,509 |  |  | $ | 100,006 |
Space and Defense Controls |  | 37,591 |  |  | 41,419 |  |  | 33,236 |
Industrial Systems |  | 46,091 |  |  | 48,542 |  |  | 45,021 |
Components |  | 52,454 |  |  | 49,772 |  |  | 67,250 |
Total operating profit |  | 250,152 |  |  | 238,242 |  |  | 245,513 |
Deductions from operating profit: |  |  |  |  |  |
Interest expense |  | 34,551 |  |  | 34,605 |  |  | 28,967 |
Equity-based compensation expense |  | 4,582 |  |  | 3,271 |  |  | 5,074 |
Corporate and other expenses, net |  | 29,308 |  |  | 27,506 |  |  | 27,638 |
Earnings before income taxes |  | $ | 181,711 |  |  | $ | 172,860 |  |  | $ | 183,834 |
Depreciation and amortization: |  |  |  |  |  |
Aircraft Controls |  | $ | 41,977 |  |  | $ | 46,541 |  |  | $ | 51,385 |
Space and Defense Controls |  | 15,554 |  |  | 16,033 |  |  | 14,054 |
Industrial Systems |  | 17,440 |  |  | 20,487 |  |  | 20,731 |
Components |  | 14,085 |  |  | 14,422 |  |  | 16,576 |
Corporate |  | 1,111 |  |  | 1,249 |  |  | 863 |
Total depreciation and amortization |  | $ | 90,167 |  |  | $ | 98,732 |  |  | $ | 103,609 |
Identifiable assets: |  |  |  |  |  |
Aircraft Controls |  | $ | 1,120,099 |  |  | $ | 1,114,672 |  |  | $ | 1,177,587 |
Space and Defense Controls |  | 423,497 |  |  | 434,620 |  |  | 426,441 |
Industrial Systems |  | 586,278 |  |  | 577,015 |  |  | 590,258 |
Components |  | 690,307 |  |  | 636,731 |  |  | 579,898 |
Corporate |  | 270,411 |  |  | 241,936 |  |  | 262,389 |
Total assets |  | $ | 3,090,592 |  |  | $ | 3,004,974 |  |  | $ | 3,036,573 |
Operating profit is net sales less cost of sales and other operating expenses, excluding interest expense, equity-based compensation expense and other corporate expenses. Cost of sales and other operating expenses are directly identifiable to the respective segment or allocated on the basis of sales, manpower or profit.
|  | 2017 |  | 2016 |  | 2015
Capital expenditures: |  |  |  |  |  |
Aircraft Controls |  | $ | 36,216 |  |  | $ | 28,437 |  |  | $ | 47,389 |
Space and Defense Controls |  | 11,451 |  |  | 7,498 |  |  | 9,022 |
Industrial Systems |  | 13,823 |  |  | 15,276 |  |  | 15,371 |
Components |  | 13,852 |  |  | 15,576 |  |  | 8,371 |
Corporate |  | 456 |  |  | 421 |  |  | 540 |
Total capital expenditures |  | $ | 75,798 |  |  | $ | 67,208 |  |  | $ | 80,693 |
Effective October 1, 2017, we changed our segment reporting structure to three reporting segments. Our former Components segment has been separated and merged into Space and Defense Controls and Industrial Systems. Sales, based on the customer’s location, and property, plant and equipment by geographic area are as follows:
|  | 2017 |  | 2016 |  | 2015
Net sales: |  |  |  |  |  |
United States |  | $ | 1,438,428 |  |  | $ | 1,353,398 |  |  | $ | 1,413,877 |
Germany |  | 195,328 |  |  | 173,182 |  |  | 199,351 |
Japan |  | 152,148 |  |  | 164,702 |  |  | 156,999 |
France |  | 145,627 |  |  | 120,907 |  |  | 84,733 |
Other |  | 565,993 |  |  | 599,748 |  |  | 670,572 |
Net sales |  | $ | 2,497,524 |  |  | $ | 2,411,937 |  |  | $ | 2,525,532 |
Property, plant and equipment, net: |  |  |  |  |  |
United States |  | $ | 303,925 |  |  | $ | 302,446 |  |  | $ | 307,874 |
Philippines |  | 64,260 |  |  | 65,000 |  |  | 68,101 |
United Kingdom |  | 64,065 |  |  | 64,280 |  |  | 77,949 |
Other |  | 90,741 |  |  | 90,643 |  |  | 82,832 |
Property, plant and equipment, net |  | $ | 522,991 |  |  | $ | 522,369 |  |  | $ | 536,756 |
Sales to Boeing were $321,110, $346,596 and $399,082, or 13%, 14% and 16% of sales, in 2017, 2016 and 2015, respectively, including sales to Boeing Commercial Airplanes of $252,977, $251,288 and $240,984 in 2017, 2016 and 2015, respectively. Sales arising from U.S. Government prime or sub-contracts, including military sales to Boeing, were $775,271, $726,562 and $780,259 in 2017, 2016 and 2015, respectively. Sales to Boeing and the U.S. Government and its prime- or sub-contractors are made primarily from our Aircraft Controls and Space and Defense Controls segments.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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