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Business Segment Information
9 Months Ended
Sep. 30, 2011
Business Segment Information [Abstract] 
Business Segment Information

Note 2 – Business segment information:

 

     Three months ended
September 30,		     Nine months ended
September 30,		  
     2010     2011     2010     2011  
     (In thousands)  

Net sales:

         

Security Products

    $ 17,723      $ 18,077      $ 51,740      $ 54,261   

Furniture Components

      16,119        15,588        44,504        44,630   

Marine Components

      1,898        2,071        6,680        6,864   
  

 

 

    

 

 

    

 

 

    

 

 

  

Total net sales

    $ 35,740      $ 35,736      $ 102,924      $ 105,755   
  

 

 

    

 

 

    

 

 

    

 

 

  

Operating income:

         

Security Products

    $ 3,680      $ 3,550      $ 10,261      $ 10,911   

Furniture Components *

      1,630        711        2,715        8,351   

Marine Components

      (393 )      (252 )      (840 )      (664 ) 

Corporate operating expense **

      (1,778 )      (2,530 )      (4,323 )      (5,221 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total operating income

      3,139        1,479        7,813        13,377   

Other non-operating income, net

      119        127        221        385   

Interest expense

      (263 )      (218 )      (683 )      (617 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Income before income taxes

    $ 2,995      $ 1,388      $ 7,351      $ 13,145   
  

 

 

    

 

 

    

 

 

    

 

 

  

Intersegment sales are not material.

 

*   Furniture Components operating income includes the following:

 

  •  

a patent litigation settlement gain of $7.5 million in the first quarter of 2011 discussed in Note 9;

 

  •  

facility consolidation costs of approximately $175,000 and $2.0 million for the third quarter and first nine months of 2011, respectively, as discussed in Note 7; and

 

  •  

patent litigation expenses of $158,000 and $2.1 million in the third quarter and first nine months of 2010 compared to nil and $227,000 in the same comparative periods for 2011.

 

**   Corporate operating expenses include a write-down on assets held for sale of approximately $500,000 in the third quarter and first nine months of 2010 compared to a $1.1 million write-down on assets held for sale in the same comparative periods for 2011. See Note 7.

On July 29, 2011, we completed the acquisition of 100% of the stock of a Canadian ergonomic component products company for initial cash consideration of the equivalent of approximately $4.9 million, net of approximately $3,000 of cash acquired, with potential additional cash consideration ranging from nil to approximately $1.5 million payable in the first quarter of 2013, contingent upon the acquired business achieving certain acquired product line sales targets during 2012. The estimated fair value of the contingent consideration recognized at the date of acquisition was $761,000. The acquisition is intended to expand our Furniture Components ergonomics product line. We have included the results of operations and cash flows of the acquired business in our Condensed Consolidated Financial Statements subsequent to the acquisition date. The purchase price has been preliminarily allocated among net assets acquired (pending completion of the final valuation), consisting of (i) net working capital (receivable, inventory and payables) of $950,000, (ii) identifiable intangibles other than goodwill of $2.0 million, (iii) goodwill of $3.0 million and (iv) deferred income tax liabilities of $450,000. The tangible and intangible net assets acquired (other than goodwill) were valued based upon a preliminary estimate of the fair value of such net assets, with the remainder of the purchase price allocated to goodwill. The business had net sales of $4.2 million in 2010 and the pro-forma effect to us, assuming this acquisition had been completed as of January 1, 2011, is not material.