XML 19 R8.htm IDEA: XBRL DOCUMENT
v3.20.2

Reportable Segments | 6 Months Ended
--- | ---
Jun. 30, 2020
Segment Reporting [Abstract] |
Reportable Segments | Reportable Segments In accordance with applicable disclosure guidance for enterprise segments and related information, the internal organization that is used by management for making operating decisions and assessing performance is used as the basis for our reportable segments. The Machine Clothing (“MC”) segment supplies permeable and impermeable belts used in the manufacture of paper, paperboard, tissue and towel, nonwovens, fiber cement and several other industrial applications. We sell our MC products directly to customer end-users in countries across the globe. Our products, manufacturing processes, and distribution channels for MC are substantially the same in each region of the world in which we operate. We design, manufacture, and market paper machine clothing (used in the manufacturing of paper, paperboard, tissue and towel) for each section of the paper machine and for every grade of paper. Paper machine clothing products are customized, consumable products of technologically sophisticated design that utilize polymeric materials in a complex structure. The Albany Engineered Composites (“AEC”) segment, including Albany Safran Composites, LLC (“ASC”), in which our customer SAFRAN Group (“Safran”) owns a 10 percent noncontrolling interest, provides highly engineered, advanced composite structures to customers in the commercial and defense aerospace industries. AEC’s largest program relates to CFM International’s LEAP engine. Under this program, AEC through ASC, is the exclusive supplier of advanced composite fan blades and cases under a long-term supply contract. The manufacturing spaces used for the production of parts under the long-term supply agreement are owned by Safran, and leased to the Company at either a market rent or a minimal cost. All lease expense is reimbursable by Safran to the Company due to the cost-plus nature of the supply agreement. In the fourth quarter of 2019, Safran leased manufacturing space from AEC for the GE9X program. Rent paid by Safran under this lease amounted to $0.5 million for the first six months of 2020. AEC net sales to Safran, substantially all of which were through ASC, were $57.0 million and $116.3 million in the first six months of 2020 and 2019, respectively. The total of Accounts receivable, Contract assets and Noncurrent receivables due from Safran amounted to $105.4 million and $114.5 million as of June 30, 2020 and December 31, 2019, respectively. Other significant programs by AEC include the F-35, Boeing 787, Sikorsky CH-53K and JASSM, as well as the fan case for the GE9X engine. In 2019, approximately 25 percent of AEC sales were related to U.S. government contracts or programs. The following tables show data by reportable segment, reconciled to consolidated totals included in the financial statements:
| Three months ended June 30, |  | Six months ended June 30, |
(in thousands) | 2020 | 2019 | 2020 | 2019
Net sales |  |  |  |
Machine Clothing | $ | 153,433 |  | $ | 155,016 |  | $ | 290,035 |  | $ | 299,349 |
Albany Engineered Composites | 72,557 |  | 118,933 |  | 171,719 |  | 225,972 |
Consolidated total | $ | 225,990 |  | $ | 273,949 |  | $ | 461,754 |  | $ | 525,321 |
Operating income/(loss) |  |  |  |
Machine Clothing | $ | 56,543 |  | $ | 49,538 |  | $ | 103,718 |  | $ | 93,781 |
Albany Engineered Composites | 8,299 |  | 17,732 |  | 15,922 |  | 27,254 |
Corporate expenses | (12,115) |  | (13,045) |  | (27,319) |  | (26,717) |
Operating income | $ | 52,727 |  | $ | 54,225 |  | $ | 92,321 |  | $ | 94,318 |
Reconciling items: |  |  |  |
Interest income | (348) |  | (587) |  | (795) |  | (1,186) |
Interest expense | 4,171 |  | 5,218 |  | 8,595 |  | 10,234 |
Other expense/(income), net | 1,091 |  | 930 |  | 16,660 |  | (278) |
Income before income taxes | $ | 47,813 |  | $ | 48,664 |  | $ | 67,861 |  | $ | 85,548 |
There were no material changes in the total assets of the reportable segments in the first six months of 2020. The table below presents restructuring costs by reportable segment (also see Note 5):
| Three months ended June 30, |  | Six months ended June 30, |
(in thousands) | 2020 | 2019 | 2020 | 2019
Machine Clothing | $ | 388 |  | $ | 935 |  | $ | 1,030 |  | $ | 1,336 |
Albany Engineered Composites | 2,248 |  | (32) |  | 2,248 |  | 51 |
Corporate expenses | 201 |  | (4) |  | 201 |  | (4) |
Total | $ | 2,837 |  | $ | 899 |  | $ | 3,479 |  | $ | 1,383 |
Products and services provided under long-term contracts represent a significant portion of sales in the Albany Engineered Composites segment and we account for these contracts using the percentage of completion (actual cost to estimated cost) method. That method requires significant judgment and estimation, which could be considerably different if the underlying circumstances were to change. When adjustments in estimated contract revenues or costs are required, any changes from prior estimates are included in earnings in the period the change occurs. In 2020, net adjustments to the estimated profitability of long-term contracts increased gross profit by $7.4 million and $6.4 million for the three and six month periods,respectively, ended June 30, 2020. In 2019, net adjustments to the estimated profitability of long-term contracts increased gross profit by $5.0 million and $5.6 million for the three and six month periods, respectively, ended June 30, 2019. We disaggregate revenue earned from contracts with customers for each of our business segments and product groups based on the timing of revenue recognition, and groupings used for internal review purposes. The following table disaggregates revenue for each product group by timing of revenue recognition:
| Three months ended June 30, 2020 |  |
(in thousands) | Point in Time Revenue Recognition | Over Time Revenue Recognition | Total
Machine Clothing | $ | 152,585 |  | $ | 848 |  | $ | 153,433 |
Albany Engineered Composites |  |  |
ASC | — |  | 17,576 |  | 17,576 |
Other AEC | 4,143 |  | 50,838 |  | 54,981 |
Total Albany Engineered Composites | 4,143 |  | 68,414 |  | 72,557 |
Total revenue | $ | 156,728 |  | $ | 69,262 |  | $ | 225,990 |
| Six months ended June 30, 2020 |  |
(in thousands) | Point in Time Revenue Recognition | Over Time Revenue Recognition | Total
Machine Clothing | $ | 288,339 |  | $ | 1,696 |  | $ | 290,035 |
Albany Engineered Composites |  |  |
ASC | — |  | 55,470 |  | 55,470 |
Other AEC | 10,463 |  | 105,786 |  | 116,249 |
Total Albany Engineered Composites | 10,463 |  | 161,256 |  | 171,719 |
Total revenue | $ | 298,802 |  | $ | 162,952 |  | $ | 461,754 |
| Three months ended June 30, 2019 |  |
(in thousands) | Point in Time Revenue Recognition | Over Time Revenue Recognition | Total
Machine Clothing | $ | 154,216 |  | $ | 800 |  | $ | 155,016 |
Albany Engineered Composites |  |  |
ASC | — |  | 58,694 |  | 58,694 |
Other AEC | 9,897 |  | 50,342 |  | 60,239 |
Total Albany Engineered Composites | 9,897 |  | 109,036 |  | 118,933 |
Total revenue | $ | 164,113 |  | $ | 109,836 |  | $ | 273,949 |
| Six months ended June 30, 2019 |  |
(in thousands) | Point in Time Revenue Recognition | Over Time Revenue Recognition | Total
Machine Clothing | $ | 297,749 |  | $ | 1,600 |  | $ | 299,349 |
Albany Engineered Composites |  |  |
ASC | — |  | 114,137 |  | 114,137 |
Other AEC | 16,142 |  | 95,693 |  | 111,835 |
Total Albany Engineered Composites | 16,142 |  | 209,830 |  | 225,972 |
Total revenue | $ | 313,891 |  | $ | 211,430 |  | $ | 525,321 |
The following table disaggregates MC segment revenue by significant product groupings (paper machine clothing (PMC) and engineered fabrics), and, for PMC, the geographical region to which the paper machine clothing was sold:
| Three months ended June 30, |  | Six months ended June 30, |
(in thousands) | 2020 | 2019 | 2020 | 2019
Americas PMC | $ | 81,225 |  | $ | 81,583 |  | $ | 154,902 |  | $ | 156,923 |
Eurasia PMC | 54,166 |  | 54,081 |  | 99,297 |  | 105,519 |
Engineered Fabrics | 18,042 |  | 19,352 |  | 35,836 |  | 36,907 |
Total Machine Clothing Net sales | $ | 153,433 |  | $ | 155,016 |  | $ | 290,035 |  | $ | 299,349 |
In accordance with ASC 606, we do not disclose the value of unsatisfied performance obligations for contracts with an original expected duration of one year or less. Contracts in the MC segment are generally for periods of less than a year. Most contracts in the AEC segment are short duration firm-fixed-price orders representing performance obligations with an original maturity of less than one year. Remaining performance obligations on contracts that had an original duration of greater than one year totaled $85 million and $112 million as of June 30, 2020 and 2019, respectively, and related primarily to firm contracts in the AEC segment. Of the remaining performance obligations as of June 30, 2020, we expect to recognize as revenue approximately $52 million during 2020 and the remainder during 2021.

X
- References No definition available. + Details
Name: | us-gaap_SegmentReportingAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration