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REVENUES | 6 Months Ended
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Mar. 31, 2019
Revenue Recognition and Deferred Revenue [Abstract] |
REVENUES |
| 14. | REVENUES
Disaggregation of Revenues Our revenues by customer type, geographic location, and revenue recognition method for the three and six-month periods ended March 31, 2019 are presented in the table below as the Company deems it best depicts how the nature, amount, timing and uncertainty of net sales and cash flows are affected by economic factors. The table below also includes a reconciliation of the disaggregated revenue within our reportable segments.
Three Months Ended March 31, 2019 (In thousands) |  | Filtration |  |  | Test |  |  | USG |  |  | Technical Packaging |  |  | Total |
Customer type: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  | $ | 46,325 |  |  | $ | 37,451 |  |  | $ | 47,551 |  |  | $ | 22,630 |  |  | $ | 153,957 |
Government |  |  | 33,153 |  |  |  | 5,424 |  |  |  | 1,339 |  |  |  | 76 |  |  |  | 39,992 |
Total revenues |  | $ | 79,478 |  |  | $ | 42,875 |  |  | $ | 48,890 |  |  | $ | 22,706 |  |  | $ | 193,949 |
Geographic location: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
United States |  | $ | 66,068 |  |  | $ | 26,694 |  |  | $ | 33,798 |  |  | $ | 11,457 |  |  | $ | 138,017 |
International |  |  | 13,410 |  |  |  | 16,181 |  |  |  | 15,092 |  |  |  | 11,249 |  |  |  | 55,932 |
Total revenues |  | $ | 79,478 |  |  | $ | 42,875 |  |  | $ | 48,890 |  |  | $ | 22,706 |  |  | $ | 193,949 |
Revenue recognition method: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Point in time |  | $ | 42,400 |  |  | $ | 12,166 |  |  | $ | 36,874 |  |  | $ | - |  |  | $ | 91,440 |
Over time |  |  | 37,078 |  |  |  | 30,709 |  |  |  | 12,016 |  |  |  | 22,706 |  |  |  | 102,509 |
Total revenues |  | $ | 79,478 |  |  | $ | 42,875 |  |  | $ | 48,890 |  |  | $ | 22,706 |  |  | $ | 193,949 |
Six Months Ended March 31, 2019 (In thousands) |  | Filtration |  |  | Test |  |  | USG |  |  | Technical Packaging |  |  | Total |
Customer type: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  | $ | 83,546 |  |  | $ | 73,688 |  |  | $ | 102,206 |  |  | $ | 41,744 |  |  | $ | 301,184 |
Government |  |  | 62,156 |  |  |  | 10,473 |  |  |  | 2,539 |  |  |  | 194 |  |  |  | 75,362 |
Total revenues |  | $ | 145,702 |  |  | $ | 84,161 |  |  | $ | 104,745 |  |  | $ | 41,938 |  |  | $ | 376,546 |
Geographic location: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
United States |  | $ | 120,833 |  |  | $ | 55,148 |  |  | $ | 73,879 |  |  | $ | 21,306 |  |  | $ | 271,166 |
International |  |  | 24,869 |  |  |  | 29,013 |  |  |  | 30,866 |  |  |  | 20,632 |  |  |  | 105,380 |
Total revenues |  | $ | 145,702 |  |  | $ | 84,161 |  |  | $ | 104,745 |  |  | $ | 41,938 |  |  | $ | 376,546 |
Revenue recognition method: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Point in time |  | $ | 74,214 |  |  | $ | 22,608 |  |  | $ | 81,107 |  |  | $ | - |  |  | $ | 177,929 |
Over time |  |  | 71,488 |  |  |  | 61,553 |  |  |  | 23,638 |  |  |  | 41,938 |  |  |  | 198,617 |
Total revenues |  | $ | 145,702 |  |  | $ | 84,161 |  |  | $ | 104,745 |  |  | $ | 41,938 |  |  | $ | 376,546 |
Remaining Performance Obligations Our remaining performance obligations, which is the equivalent of our backlog, represent the expected transaction price allocated to our contracts that we expect to recognize as revenue in future periods when we perform under the contracts. These remaining obligations include amounts that have been formally appropriated under contracts with the U.S. Government, and exclude unexercised contract options and potential orders under ordering-type contracts such as Indefinite Delivery, Indefinite Quantity contracts. At March 31, 2019, we had $436.1 million in remaining performance obligations of which we expect to recognize revenues of 83% in the next twelve months. Contract assets and liabilities Assets and liabilities related to our contracts with customers are reported on a contract-by-contract basis at the end of each reporting period. At March 31, 2019, contract assets and liabilities totaled $100.5 million and $55.5 million, respectively. Upon adoption of ASC 606 on October 1, 2018, contract assets and liabilities related to our contracts with customers were $87 million and $51 million, respectively. During the first six months of 2019, we recognized approximately $30 million in revenues that were included in the contract liabilities balance at the adoption date. Reconciliation of ASC 606 to Prior Accounting Standards The amount by which each financial statement line item is affected in 2019 as a result of applying the new accounting standard as discussed in Note 2 is presented below:
|  | March 31, 2019 |
(In thousands) |  | As Reported |  |  | Effect of the adoption of ASC 606 |  |  | Under Prior Accounting |
Consolidated Balance Sheets |  |  |  |  |  |  |  |  |  |  |  |
Contract assets (1) |  | $ | 100,540 |  |  | $ | (39,565 | ) |  | $ | 60,975 |
Inventories |  |  | 124,493 |  |  |  | 34,692 |  |  |  | 159,185 |
Total current assets |  |  | 435,959 |  |  |  | (4,874 | ) |  |  | 431,085 |
Total assets |  |  | 1,293,963 |  |  |  | (4,874 | ) |  |  | 1,289,089 |
Contract liabilities (2) |  |  | 55,453 |  |  |  | 1,754 |  |  |  | 57,207 |
Total current liabilities |  |  | 201,945 |  |  |  | 1,754 |  |  |  | 203,699 |
Deferred tax liabilities |  |  | 62,938 |  |  |  | (1,122 | ) |  |  | 61,816 |
Total liabilities |  |  | 499,567 |  |  |  | 631 |  |  |  | 500,198 |
Retained earnings |  |  | 643,018 |  |  |  | (5,505 | ) |  |  | 637,513 |
Total shareholders’ equity |  |  | 794,396 |  |  |  | (5,505 | ) |  |  | 788,891 |
Total liabilities and shareholders’ equity |  | $ | 1,293,963 |  |  |  | (4,874 | ) |  |  | 1,289,089 |
| (1) | Previously “cost and estimated earnings on long-term contracts”
| (2) | Previously “advance payments on long-term contracts” and “current portion of deferred revenue”
|  | Three Months Ended March 31, 2019 |
(In thousands, except per share amounts) |  | As Reported |  |  | Effect of the adoption of ASC 606 |  |  | Under Prior Accounting |
Consolidated Statements of Operations |  |  |  |  |  |  |  |  |
Net sales |  | $ | 193,949 |  |  | $ | (2,879 | ) |  | $ | 191,070 |
Cost of sales |  |  | 121,946 |  |  |  | (3,719 | ) |  |  | 118,227 |
Total costs and expenses |  |  | 172,594 |  |  |  | (3,719 | ) |  |  | 168,875 |
Earnings before income tax |  |  | 21,355 |  |  |  | 839 |  |  |  | 22,194 |
Income tax expense (benefit) |  |  | 2,558 |  |  |  | 117 |  |  |  | 2,675 |
Net earnings |  |  | 18,797 |  |  |  | 723 |  |  |  | 19,520 |
Earnings per share: |  |  |  |  |  |  |  |  |  |  |  |
Basic: |  |  |  |  |  |  |  |  |  |  |  |
Net earnings |  | $ | 0.73 |  |  | $ | 0.02 |  |  | $ | 0.75 |
Diluted: |  |  |  |  |  |  |  |  |  |  |  |
Net earnings |  | $ | 0.72 |  |  | $ | 0.03 |  |  | $ | 0.75 |
Consolidated Statements of Comprehensive Income |  |  |  |  |  |  |  |  |  |  |  |
Net earnings |  | $ | 18,797 |  |  | $ | 723 |  |  | $ | 19,520 |
Comprehensive income |  |  | 19,600 |  |  |  | 723 |  |  |  | 20,323 |
|  | Six Months Ended March 31, 2019 |
(In thousands, except per share amounts) |  | As Reported |  |  | Effect of the adoption of ASC 606 |  |  | Under Prior Accounting |
Consolidated Statements of Operations |  |  |  |  |  |  |  |  |
Net sales |  | $ | 376,546 |  |  | $ | (5,779 | ) |  | $ | 370,767 |
Cost of sales |  |  | 240,854 |  |  |  | (6,981 | ) |  |  | 233,873 |
Total costs and expenses |  |  | 331,934 |  |  |  | (6,981 | ) |  |  | 324,953 |
Earnings before income tax |  |  | 44,612 |  |  |  | 1,201 |  |  |  | 45,813 |
Income tax expense (benefit) |  |  | 8,498 |  |  |  | 228 |  |  |  | 8,726 |
Net earnings |  |  | 36,114 |  |  |  | 973 |  |  |  | 37,087 |
Earnings per share: |  |  |  |  |  |  |  |  |  |  |  |
Basic: |  |  |  |  |  |  |  |  |  |  |  |
Net earnings |  | $ | 1.39 |  |  | $ | 0.04 |  |  | $ | 1.43 |
Diluted: |  |  |  |  |  |  |  |  |  |  |  |
Net earnings |  | $ | 1.38 |  |  | $ | 0.04 |  |  | $ | 1.42 |
Consolidated Statements of Comprehensive Income |  |  |  |  |  |  |  |  |  |  |  |
Net earnings |  | $ | 36,114 |  |  | $ | 973 |  |  | $ | 37,087 |
Comprehensive income |  |  | 32,363 |  |  |  | 973 |  |  |  | 33,336 |
Consolidated Statements of Cash flows |  |  |  |  |  |  |  |  |  |  |  |
Net earnings |  | $ | 36,114 |  |  | $ | 973 |  |  | $ | 37,087 |
Adjustments to reconcile net earnings to net cash provided by operating activities: |  |  |  |  |  |  |  |  |  |  |  |
Change in assets and liabilities |  | $ | (28,847 | ) |  |  | (973 | ) |  | $ | (29,820 | )
Net cash provided by operating activities |  |  | 16,992 |  |  |  | - |  |  |  | 16,992 |

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