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Share Name | Share Symbol | Market | Type |
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Systemax Inc | NYSE:SYX | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 35.16 | 0 | 01:00:00 |
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☒
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ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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11-3262067
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Title of each class
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Name of each exchange on which registered
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Common Stock, par value $ .01 per share
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New York Stock Exchange
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Large Accelerated Filer ☐
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Accelerated Filer ☒
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Non-Accelerated Filer ☐
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Smaller reporting company ☐
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Emerging growth company ☐
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Part I
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Part II
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Part III
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Part IV
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Item 15.
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•
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risks involved with e-commerce, including possible loss of business and customer dissatisfaction if outages or other computer-related problems should preclude customer access to our products and services
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•
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our information systems and other technology platforms supporting our sales, procurement and other operations are critical to our operations and disruptions or delays have occurred and could occur in the future, and if not timely addressed would have a material adverse effect on us
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•
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a data security breach due to our e-commerce, data storage or other information systems being hacked by those seeking to steal Company information, vendor, employee or customer information, or due to employee error, resulting in disruption to our operations, litigation and/or loss of reputation
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•
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general economic conditions will continue to impact our business
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•
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technological change has had and can continue to have a material effect on our product mix and results of operations
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•
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sales tax laws or government enforcement priorities may be changed which could result in e-commerce and direct mail retailers having to collect sales taxes in states where the current laws and interpretations do not require us to do so
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•
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our international operations are subject to risks such as fluctuations in currency rates, foreign regulatory requirements and political uncertainty
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•
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managing various inventory risks, such as being unable to profitably resell excess or obsolete inventory and/or the loss of product return rights and price protection from our vendors
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•
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meeting credit card industry compliance standards in order to maintain our ability to accept credit cards
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•
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timely availability of existing and new products
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•
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risks associated with delivery of merchandise to customers by utilizing common carrier delivery services
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•
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borrowing costs or availability, including our ability to maintain satisfactory credit agreements and to renew credit facilities
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•
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pending or threatened litigation and investigations
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•
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the availability of key personnel
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•
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the continuation of key vendor relationships and the availability of credit insurance to key vendors
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North America
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Europe
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www.globalindustrial.com
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www.inmac-wstore.com
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www.globalindustrial.ca
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www.misco.fr
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www.nexelwire.com
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www.chdistgov.com
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www.industrialsupplies.com
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North
America
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Europe and Asia
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Total
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2017
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Net sales
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$
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791.8
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$
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473.6
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$
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1,265.4
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Operating income
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$
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46.8
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$
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24.5
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$
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71.3
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Identifiable assets
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$
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362.4
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$
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189.0
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$
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551.4
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2016
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Net sales
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$
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719.2
|
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$
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451.1
|
|
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$
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1,170.3
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Operating income
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$
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13.4
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$
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14.3
|
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$
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27.7
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Identifiable assets
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$
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290.5
|
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$
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275.6
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$
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566.1
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2015
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Net sales
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$
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801.8
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$
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441.7
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|
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$
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1,243.5
|
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Operating income (loss)
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$
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(16.5
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)
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$
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13.0
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$
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(3.5
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)
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Identifiable assets
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$
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470.3
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|
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$
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239.8
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$
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710.1
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•
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Corporate Ethics Policy for officers, directors and employees
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•
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Charter for the Audit Committee of the Board of Directors
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•
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Charter for the Compensation Committee of the Board of Directors
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•
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Charter for the Nominating/Corporate Governance Committee of the Board of Directors
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•
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Corporate Governance Guidelines and Principles
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•
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General economic conditions, such as decreased consumer confidence and spending could result in our failure to achieve our historical sales growth rates and profit levels.
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•
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The markets for our products and services are extremely competitive and if we are unable to successfully respond to our competitors’ strategies our sales and gross margins will be adversely affected.
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•
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Sales tax laws may be interpreted in a manner that could result in ecommerce and direct mail retailers to being held to have been required to collect sales taxes in states where we believe the then current laws did not require us to do so. This could result in us having substantial tax liabilities for past sales.
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•
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Events such as acts of war or terrorism, natural disasters, data security breaches, changes in law, or large losses could adversely affect our insurance coverage and insurance expense, resulting in an adverse effect on our profitability and financial condition.
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•
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Adverse weather events or natural disasters could negatively affect or disrupt our operations. We may be affected by global climate changes or by legal, regulatory or market responses to such potential change.
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•
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Environmental Matters
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•
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We rely to a great extent on our information and telecommunications systems, and significant system failures or outages, or our failure to properly evaluate, upgrade or replace our systems, or the failure of our security/safety measures to protect our systems and websites, could have an adverse effect on our results of operations.
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•
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We have exited our SARL Businesses in 2017 and NATG business in 2015 and could incur costs in excess of our estimated exit expenses.
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We rely on third party suppliers for most of our products and services. The loss or interruption of these relationships could impact our sales volumes, the levels of inventory we must carry, and/or result in sales delays and/or higher inventory costs from new suppliers.
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•
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Goodwill and intangible assets may become impaired resulting in a charge to earnings.
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•
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Our substantial international operations are subject to risks such as fluctuations in currency rates (which can adversely impact foreign revenues and profits when translated to US Dollars), foreign regulatory requirements, political uncertainty and the management of our growing international operations.
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•
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We are exposed to various inventory risks, such as being unable to profitably resell excess or obsolete inventory and/or the loss of product return rights and price protection from our vendors; such events could lower our gross margins or result in inventory write-downs that would reduce reported future earnings.
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•
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Our ETG employees are represented by unions or workers’ councils or are employed subject to local laws that are less favorable to employers than the laws of the U.S.
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•
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We may be unable to reduce prices in reaction to competitive pressures, or implement cost reductions or new product line expansion to address gross profit and operating margin pressures; failure to mitigate these pressures could adversely affect our operating results and financial condition.
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•
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Sales to individual customers expose us to credit card fraud, which impacts our operations. If we fail to adequately protect ourselves from credit card fraud, our operations could be adversely impacted.
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Our business is dependent on certain key personnel.
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•
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We are subject to litigation risk due to the nature of our business, which may have a material adverse effect on our results of operations and business.
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•
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Our profitability can be adversely affected by changes in our income tax exposure due to changes in tax rates or laws, changes in our effective tax rate due to changes in the mix of earnings among different countries, restrictions on utilization of tax benefits and changes in valuation of our deferred tax assets and liabilities.
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•
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Changes in accounting standards or practices, as well as new accounting pronouncements or interpretations, may require us to account for and report our financial results in a different manner in the future, which may be less favorable than the manner used historically.
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•
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Concentration of Ownership and Control Limits Stockholders Ability to Influence Corporate Actions
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•
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Risk of Thin Trading and Volatility of our Common Stock Could Impact Stockholder Value
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High
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Low
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2017
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First Quarter
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$
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11.35
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$
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7.20
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Second Quarter
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20.44
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|
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11.66
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Third Quarter
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28.25
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18.07
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Fourth Quarter
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34.31
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27.12
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2016
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First Quarter
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$
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9.55
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|
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$
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7.46
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Second Quarter
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9.35
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|
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7.89
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Third Quarter
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9.06
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7.65
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Fourth Quarter
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9.29
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7.36
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Years Ended December 31,
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(In millions, except per share data)
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2017
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2016
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2015
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2014
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2013
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Statement of Operations Data:
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Net sales
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$
|
1,265.4
|
|
|
$
|
1,170.3
|
|
|
$
|
1,243.5
|
|
|
$
|
1,364.7
|
|
|
$
|
1,291.0
|
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Gross profit
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$
|
351.4
|
|
|
$
|
307.9
|
|
|
$
|
310.5
|
|
|
$
|
315.7
|
|
|
$
|
291.2
|
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Operating income (loss) from continuing operations
|
$
|
71.3
|
|
|
$
|
27.7
|
|
|
$
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(3.5
|
)
|
|
$
|
6.8
|
|
|
$
|
(6.6
|
)
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Net income (loss) from continuing operations
|
$
|
76.1
|
|
|
$
|
16.9
|
|
|
$
|
(24.0
|
)
|
|
$
|
(8.9
|
)
|
|
$
|
(36.6
|
)
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Per Share Amounts
:
|
|
|
|
|
|
|
|
|
|
|
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||||||||
Net income (loss) from continuing operations — diluted
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$
|
2.02
|
|
|
$
|
0.45
|
|
|
$
|
(0.65
|
)
|
|
$
|
(0.24
|
)
|
|
$
|
(0.99
|
)
|
Weighted average common shares — diluted
|
37.6
|
|
|
37.2
|
|
|
37.1
|
|
|
37.1
|
|
|
37.0
|
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|||||
Cash dividends declared per common share
|
$
|
1.85
|
|
|
$
|
0.10
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Balance Sheet Data:
|
|
|
|
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|
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Working capital
|
$
|
178.3
|
|
|
$
|
186.2
|
|
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$
|
214.2
|
|
|
$
|
310.6
|
|
|
$
|
345.8
|
|
Total assets
|
$
|
551.4
|
|
|
$
|
566.1
|
|
|
$
|
710.1
|
|
|
$
|
896.9
|
|
|
$
|
942.2
|
|
Shareholders’ equity
|
$
|
211.8
|
|
|
$
|
214.4
|
|
|
$
|
253.9
|
|
|
$
|
359.6
|
|
|
$
|
406.2
|
|
Accounting policy
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Assumptions and uncertainties
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Quantification and analysis of effect on actual results if estimates differ materially
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Revenue Recognition.
We recognize product sales when persuasive evidence of an order arrangement exists, delivery has occurred, the sales price is fixed or determinable and collectability is reasonably assured. Generally, these criteria are met at the time of receipt by customers when title and risk of loss both are transferred, except in our IPG segment where title and risk pass at time of shipment. Sales are presented net of returns and allowances, rebates and sales incentives. Reserves for estimated returns and allowances are provided when sales are recorded, based on historical experience and current trends.
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Our revenue recognition policy contains assumptions and judgments made by management related to the timing and amounts of future sales returns. Sales returns are estimated based upon historical experience and current known trends.
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We have not made any material changes to our sales return reserve policy in the past four years and we do not anticipate making any material changes to this policy in the future. However if our estimates are materially different than our actual experience we could have a material gain or loss adjustment.
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Allowance for Doubtful Accounts Receivable
. We record an allowance for doubtful accounts to reflect our estimate of the collectability of our trade accounts receivable. While bad debt allowances have been within expectations and the provisions established, there can be no guarantee that we will continue to experience the same allowance rate we have in the past.
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Our allowance for doubtful accounts policy contains assumptions and judgments made by management related to collectability of aged accounts receivable and chargebacks from credit card sales. We evaluate the collectability of accounts receivable based on a combination of factors, including an analysis of the age of customer accounts and our historical experience with accounts receivable write-offs. The analysis also includes the financial condition of a specific customer or industry, and general economic conditions. In circumstances where we are aware of customer credit card charge-backs or a specific customer’s inability to meet its financial obligations, a specific reserve for bad debts applicable to amounts due to reduce the net recognized receivable to the amount management reasonably believes will be collected is recorded. In those situations with ongoing discussions, the amount of bad debt recognized is based on the status of the discussions.
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We have not made any material changes to our allowance for doubtful accounts receivable reserve policy in the past four years and we do not anticipate making any material changes to this policy in the future. However if our estimates are materially different than our actual experience we could have a material gain or loss adjustment.
A change of 10% in our allowance for doubtful accounts reserve at December 31, 2017 would impact net income by approximately $0.2 million.
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Inventory valuation
. We value our inventories at the lower of cost or net realizable value; cost being determined on the first-in, first-out method except in France where an average cost is used. Excess and obsolete or unmarketable merchandise are written down based on historical experience, assumptions about future product demand and market conditions. If market conditions are less favorable than projected or if technological developments result in accelerated obsolescence, additional write-downs may be required. While obsolescence and resultant markdowns have been within expectations, there can be no guarantee that we will continue to experience the same level of markdowns we have in the past.
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Our inventory reserve policy contains assumptions and judgments made by management related to inventory aging, obsolescence, credits that we may obtain for returned merchandise, shrink and consumer demand.
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We have not made any material changes to our inventory reserve policy in the past four years and we do not anticipate making any material changes to this policy in the future. However if our estimates are materially different than our actual experience we could have a material loss adjustment.
A change of 10% in our inventory reserves at December 31, 2017 would impact net income by approximately $0.2 million.
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Goodwill and Intangible Assets.
We apply the provisions of relevant accounting guidance in our valuation of goodwill, trademarks, domain names, client lists and other intangible assets. Relevant accounting guidance requires that goodwill and indefinite lived intangibles be reviewed at least annually for impairment or more frequently if indicators of impairment exist. The amount of an impairment loss would be recognized as the excess of the asset’s carrying value over its fair value.
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Our impairment testing involves judgments and uncertainties, quantitative and qualitative, related to the use of discounted cash flow models and forecasts of future results, both of which involve significant judgment and may not be reliable. Significant management judgment is necessary to evaluate the operating environment and economic conditions that exist to develop a forecast for a reporting unit. Assumptions related to the discounted cash flow models we use include the inputs used to determine the Company’s weighted average cost of capital including a market risk premium, the beta of a reporting unit, reporting unit specific risk premiums and terminal growth values. Critical assumptions related to the forecast inputs used in our discounted cash flow models include projected sales growth, gross margin percentages, new business opportunities, working capital requirements, capital expenditures and growth in selling, general and administrative expense. We also use our Company's market capitalization and comparable company market data to validate our reporting unit valuations.
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We have not made any material changes to our goodwill policy in the past four years and we do not anticipate making any material changes to this policy in the future.
In the fourth quarter of 2016, the Company conducted an evaluation of certain intangible assets of its Mexico operation in its IPG segment and concluded that they were impaired and a charge of $0.1 million, pre-tax was recorded. In our discontinued ETG segment, impairment charges of $0.3 million were recorded in the fourth quarter of 2016, related to impairment of intangible assets in the United Kingdom.
We have approximately, in aggregate, $14.5 million in goodwill and intangible assets at December 31, 2017. We do not believe it is reasonably likely that the estimates or assumptions used to determine whether any of our remaining goodwill or intangible assets are impaired will change materially in the future. However if the inputs used in our discounted cash flow models or our forecasts are materially different than actual experience we could incur impairment charges that are material.
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Long-lived Assets.
Management exercises judgment in evaluating our long-lived assets for impairment and in their depreciation and amortization methods and lives including evaluating undiscounted cash flows.
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The impairment analysis for long lived assets requires management to make judgments about useful lives and to estimate fair values of long lived assets. It may also require us to estimate future cash flows of related assets using discounted cash flow model. Our estimates of future cash flows involve assumptions concerning future operating performance and economic conditions. While we believe that our estimates of future cash flows are reasonable, different assumptions regarding such cash flows could materially affect our evaluations.
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We have not made any material changes to our long lived assets policy in the past four years and we do not anticipate making any material changes to this policy in the future.
In the fourth quarter of 2016, the Company, after conducting an evaluation of the long-lived assets in its United Kingdom operations, recorded an impairment charge of $1.7 million within ETG discontinued operations segment.
We do not believe it is reasonably likely that the estimates and assumptions used to determine long lived asset impairment will vary materially in the future. However if our estimates are materially different than our actual experience we could have a material gain or loss adjustment.
A change of 10% in the carrying value of our long lived assets would impact net income by approximately $1.5 million.
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Vendor Accruals.
Our contractual agreements with certain suppliers provide us with funding or allowances for costs such as price protection, markdowns and advertising as well as funds or allowances for purchasing volumes.
Generally, allowances received as a reimbursement of identifiable costs are recorded as an expense reduction when the cost is incurred. Sales related allowances are generally determined by our level of purchases of product and are deferred and recorded as a reduction of inventory carrying value and are ultimately included as a reduction of cost of goods when inventory is sold.
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Management makes assumptions and exercises judgment in estimating period end funding and allowances earned under our various agreements. Estimates are developed based on the terms of our vendor agreements and using existing expenditures for which funding is available, determining products whose market price would indicate coverage for markdown or price protection is available and estimating the level of our performance under agreements that provide funds or allowances for purchasing volumes. Estimates of funding or allowances for purchasing volume will include projections of annual purchases which are developed using current actual purchase data and historical purchase trends. Accruals in interim periods could be materially different if actual purchase volumes differ from projections.
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We have not made any material changes to our vendor accrual policy in the past four years nor do we anticipate making any material changes to this policy in the future.
If actual results are different from the projections used we could have a material gain or loss adjustment.
A change of 10% in our vendor accruals at December 31, 2017 would impact net income by approximately $0.4 million.
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Income Taxes.
We are subject to taxation from federal, state and foreign jurisdictions and the determination of our tax provision is complex and requires significant management judgment.
We conduct operations in numerous U.S. states and foreign locations. Our effective tax rate depends upon the geographic distribution of our pre-tax income or losses among locations with varying tax rates and rules. As the geographic mix of our pre-tax results among various tax jurisdictions changes, the effective tax rate may vary from period to period. We are also subject to periodic examination from domestic and foreign tax authorities regarding the amount of taxes due. These examinations include questions regarding the timing and amount of deductions and the allocation of income among various tax jurisdictions. We establish as needed, and periodically reevaluate, an estimated income tax reserve on our consolidated balance sheet to provide for the possibility of adverse outcomes in income tax proceedings. While management believes that we have identified all reasonably identifiable exposures and whether or not a reserve is appropriate, it is possible that additional exposures exist and/or that exposures may be settled at amounts different than the amounts reserved.
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The determination of deferred tax assets and liabilities and any valuation allowances that might be necessary requires management to make significant judgments concerning the ability to realize net deferred tax assets. The realization of our net deferred tax assets is significantly dependent upon the generation of future taxable income. In estimating future taxable income there are judgments and uncertainties related to the development of forecasts of future results that may not be reliable. Significant management judgment is also necessary to evaluate the operating environment and economic conditions that exist to develop a forecast for a reporting unit. Where management has determined that it is more likely than not that some portion or the entire deferred tax asset will not be realized, we have provided a valuation allowance. If the realization of those deferred tax assets in the future is considered more likely than not, an adjustment to the deferred tax assets would increase net income in the period such determination is made.
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|
We have not made any material changes to our income tax policy in the past four years and we do not anticipate making any material changes to this policy in the near future.
We do not believe it is reasonably likely that the estimates or assumptions used to determine our deferred tax assets and liabilities and related valuation allowances will change materially in the future. However if our estimates are materially different than our actual experience we could have a material gain or loss adjustment.
In 2017 the Company recorded approximately $10.8 million in tax expense related to the revaluation of deferred tax assets as a result of tax law changes in the U.S. and France. The Company also recorded approximately $5.2 million in tax expense, also related to tax reform in the U.S., for taxes on undistributed earnings of its foreign subsidiaries. This tax was also offset by the utilization of net operating losses (see Note 8 to the Consolidated Financial Statements.
|
Special charges.
We have recorded reorganization, restructuring and other charges in the past and could in the future commence further reorganization, restructuring and other activities which result in recognition in charges to income.
|
|
The recording of reorganization, restructuring and other charges may involve assumptions and judgments about future costs and timing for amounts related to personnel terminations, stay bonuses, lease termination costs, lease sublet revenues, outplacement services, contract termination costs, asset impairments and other exit costs. Management may estimate these costs using existing contractual and other data or may rely on third party expert data.
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|
When we incur a liability related to these actions, we estimate and record all appropriate expenses. We do not believe it is reasonably likely that the estimates or assumptions used to determine our reorganization, restructuring and other charges will change materially in the future. However if our estimates are materially different than our actual experience we could have a material gain or loss adjustment.
The Company recorded special charges of $0.3 million, $3.9 million and $26.9 million in continuing operations related to reorganization, restructuring and asset impairment and other charges for the years ended 2017, 2016 and 2015, respectively.
|
•
|
IPG sales increased 10.6% to $791.8 million and operating profit increased 102.9% to $69.6 million. On a constant currency basis, average daily sales increased 11.0%.
|
•
|
ETG sales increased 5.0% to $473.6 million and operating profit increased 69.0% to $24.5 million. On a constant currency basis, average daily sales increased 3.8%.
|
•
|
Consolidated operating income grew 157.4% to $71.3 million compared to $27.7 million in the prior year.
|
|
Year Ended
December 31, |
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Industrial Products
|
$
|
791.8
|
|
|
$
|
715.6
|
|
|
$
|
698.6
|
|
Technology Products - Europe
|
473.6
|
|
|
451.1
|
|
|
441.7
|
|
|||
NATG - continuing operations
|
—
|
|
|
—
|
|
|
97.8
|
|
|||
Corporate and Other
|
—
|
|
|
3.6
|
|
|
5.4
|
|
|||
GAAP Net Sales
|
1,265.4
|
|
|
1,170.3
|
|
|
1,243.5
|
|
|||
|
|
|
|
|
|
|
|
||||
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
||||
Technology Products - Europe:
|
|
|
|
|
|
|
|
||||
Reverse results of Germany included in GAAP Net Sales
|
—
|
|
|
(33.9
|
)
|
|
(59.1
|
)
|
|||
Total Non-GAAP Adjustments: Technology Products Europe
|
—
|
|
|
(33.9
|
)
|
|
(59.1
|
)
|
|||
|
|
|
|
|
|
|
|
||||
Technology Products - NA:
|
|
|
|
|
|
||||||
Reverse results of Germany included in GAAP Net Sales
|
—
|
|
|
—
|
|
|
(97.8
|
)
|
|||
Total Non-GAAP Adjustments: Technology Products NA
|
—
|
|
|
—
|
|
|
(97.8
|
)
|
|||
|
|
|
|
|
|
||||||
Corporate and Other:
|
|
|
|
|
|
|
|
||||
Reverse results of Afligo included in GAAP Net Sales
|
—
|
|
|
(3.6
|
)
|
|
(5.4
|
)
|
|||
Total Non-GAAP Adjustments: Corporate and Other
|
—
|
|
|
(3.6
|
)
|
|
(5.4
|
)
|
|||
|
|
|
|
|
|
|
|
||||
Industrial Products
|
791.8
|
|
|
715.6
|
|
|
698.6
|
|
|||
Technology Products-Europe
|
473.6
|
|
|
417.2
|
|
|
382.6
|
|
|||
NATG - continuing operations
|
—
|
|
|
—
|
|
|
—
|
|
|||
Corporate and Other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Non-GAAP Net Sales
|
$
|
1,265.4
|
|
|
$
|
1,132.8
|
|
|
$
|
1,081.2
|
|
|
|
Year Ended
December 31, |
||||||||||
|
|
2017
|
|
2016
|
|
2015
|
||||||
Industrial Products
|
|
$
|
273.2
|
|
|
$
|
233.3
|
|
|
$
|
228.7
|
|
Technology Products - Europe
|
|
78.2
|
|
|
73.0
|
|
|
67.4
|
|
|||
Technology Products - NA
|
|
—
|
|
|
—
|
|
|
10.5
|
|
|||
Corporate and Other
|
|
—
|
|
|
1.6
|
|
|
3.9
|
|
|||
GAAP Gross Profit
|
|
351.4
|
|
|
307.9
|
|
|
310.5
|
|
|||
|
|
|
|
|
|
|
|
|
||||
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
||||
Technology Products - Europe:
|
|
|
|
|
|
|
|
|
||||
Reverse results of Germany included in GAAP Gross Profit
|
|
—
|
|
|
(3.3
|
)
|
|
(5.0
|
)
|
|||
Total Non-GAAP Adjustments: Technology Products Europe
|
|
—
|
|
|
(3.3
|
)
|
|
(5.0
|
)
|
|||
|
|
|
|
|
|
|
|
|
||||
Technology Products - NA:
|
|
|
|
|
|
|
||||||
Reverse results of NATG included in GAAP Gross Profit
|
|
—
|
|
|
—
|
|
|
(10.5
|
)
|
|||
Total Non-GAAP Adjustments: Technology Products NA
|
|
—
|
|
|
—
|
|
|
(10.5
|
)
|
|||
|
|
|
|
|
|
|
||||||
Corporate and Other:
|
|
|
|
|
|
|
|
|
||||
Reverse results of Afligo included in GAAP Gross Profit
|
|
—
|
|
|
(1.6
|
)
|
|
(3.9
|
)
|
|||
Total Non-GAAP Adjustments: Corporate and Other
|
|
—
|
|
|
(1.6
|
)
|
|
(3.9
|
)
|
|||
|
|
|
|
|
|
|
|
|
||||
Industrial Products
|
|
273.2
|
|
|
233.3
|
|
|
228.7
|
|
|||
Technology Products- Europe
|
|
78.2
|
|
|
69.7
|
|
|
62.4
|
|
|||
Technology Products - NA
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Corporate and Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Non-GAAP Gross Profit
|
|
$
|
351.4
|
|
|
$
|
303.0
|
|
|
$
|
291.1
|
|
|
Year Ended December 31,
|
||||||||||
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Industrial Products
|
$
|
69.6
|
|
|
$
|
34.3
|
|
|
$
|
43.7
|
|
Technology Products - Europe
|
24.5
|
|
|
14.5
|
|
|
13.0
|
|
|||
Technology Products - NA
|
(0.6
|
)
|
|
(2.8
|
)
|
|
(38.2
|
)
|
|||
Corporate and Other
|
(22.2
|
)
|
|
(18.3
|
)
|
|
(22.0
|
)
|
|||
GAAP operating income (loss)
|
71.3
|
|
|
27.7
|
|
|
(3.5
|
)
|
|||
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|||
Industrial Products:
|
|
|
|
|
|
|
|
|
|||
Integration costs
|
—
|
|
|
—
|
|
|
1.0
|
|
|||
Intangible asset amortization
|
1.0
|
|
|
0.5
|
|
|
0.3
|
|
|||
Stock-based and other special compensation
|
0.3
|
|
|
0.4
|
|
|
(1.0
|
)
|
|||
Total Non-GAAP Adjustments – Industrial Products
|
1.3
|
|
|
0.9
|
|
|
0.3
|
|
|||
|
|
|
|
|
|
||||||
Technology Products - Europe:
|
|
|
|
|
|
|
|
|
|||
Reverse results of Germany operations
|
0.5
|
|
|
4.7
|
|
|
3.0
|
|
|||
Intangible asset amortization
|
0.1
|
|
|
0.4
|
|
|
—
|
|
|||
Total Non-GAAP Adjustments: Technology Products Europe
|
0.6
|
|
|
5.1
|
|
|
3.0
|
|
|||
|
|
|
|
|
|
||||||
Technology Products - NA:
|
|
|
|
|
|
|
|
|
|||
Reverse results of NATG included in GAAP continuing operations
|
0.6
|
|
|
2.8
|
|
|
38.2
|
|
|||
Total Non-GAAP Adjustments: Technology Products NA
|
0.6
|
|
|
2.8
|
|
|
38.2
|
|
|||
|
|
|
|
|
|
||||||
Corporate and Other:
|
|
|
|
|
|
|
|
|
|||
Gain on sale of Afligo
|
—
|
|
|
(3.9
|
)
|
|
—
|
|
|||
Reverse results of Afligo included in GAAP continuing operations
|
—
|
|
|
2.2
|
|
|
0.1
|
|
|||
Stock based compensation
|
1.3
|
|
|
1.1
|
|
|
0.6
|
|
|||
Total Non-GAAP Adjustments: Corporate and Other
|
1.3
|
|
|
(0.6
|
)
|
|
0.7
|
|
|||
|
|
|
|
|
|
||||||
Industrial Products
|
70.9
|
|
|
35.2
|
|
|
44.0
|
|
|||
Technology Products - Europe
|
25.1
|
|
|
19.6
|
|
|
16.0
|
|
|||
Technology Products - NA
|
—
|
|
|
—
|
|
|
—
|
|
|||
Corporate and Other
|
(20.9
|
)
|
|
(18.9
|
)
|
|
(21.3
|
)
|
|||
Non-GAAP operating income
|
$
|
75.1
|
|
|
$
|
35.9
|
|
|
$
|
38.7
|
|
|
December 31,
|
|
|
||||||||
|
2017
|
|
2016
|
|
$ Change
|
||||||
Cash
|
$
|
184.5
|
|
|
$
|
149.7
|
|
|
$
|
34.8
|
|
Accounts receivable, net
|
$
|
174.3
|
|
|
$
|
148.6
|
|
|
$
|
25.7
|
|
Inventories
|
$
|
131.5
|
|
|
$
|
116.7
|
|
|
$
|
14.8
|
|
Prepaid expenses and other current assets
|
$
|
3.8
|
|
|
$
|
3.9
|
|
|
$
|
(0.1
|
)
|
Accounts payable
|
$
|
196.1
|
|
|
$
|
181.3
|
|
|
$
|
14.8
|
|
Dividend payable
|
$
|
55.7
|
|
|
$
|
—
|
|
|
$
|
55.7
|
|
Accrued expenses and other current liabilities
|
$
|
64.0
|
|
|
$
|
49.2
|
|
|
$
|
14.8
|
|
Working capital
|
$
|
178.3
|
|
|
$
|
186.2
|
|
|
$
|
(7.9
|
)
|
|
Total
|
|
Less than
1 year
|
|
1-3 years
|
|
3-5 years
|
|
More than
5 years
|
||||||
Contractual Obligations:
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
||||||
Capital lease obligations
|
$
|
0.2
|
|
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Non-cancelable operating leases, net of subleases
|
120.3
|
|
|
18.4
|
|
|
38.1
|
|
|
27.5
|
|
|
36.3
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Purchase & other obligations
|
23.6
|
|
|
4.4
|
|
|
10.1
|
|
|
9.1
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total contractual obligations
|
$
|
144.1
|
|
|
22.9
|
|
|
48.3
|
|
|
36.6
|
|
|
36.3
|
|
(a) 1.
|
|
Consolidated Financial Statements of Systemax Inc.
|
Reference
|
|
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
2
|
|
Financial Statement Schedule:
|
|
|
|
|
|
||
|
|
The following financial statement schedule is filed as part of this report and should be read together with our consolidated financial statements:
|
|
|
|
|
|
||
|
|
Schedule II — Valuation and Qualifying Accounts
|
60
|
|
|
|
|
||
|
|
Schedules not included with this additional financial data have been omitted because they are not applicable or the required information is shown in the consolidated financial statements or notes thereto.
|
|
3
|
|
Exhibits.
|
|
|
|
|
|
|
|
|
|
Exhibit
No.
|
|
Description
|
|
|
|
|
|
|
|
3.1
|
|
Certificate of Incorporation of the Company (incorporated by reference to the Company's registration statement on Form S-1) (Registration No. 33-92052).
|
|
|
|
Certificate of Amendment of Certificate of Incorporation of the Company (incorporated by reference to the Company’s report on Form 8-K dated May 18, 1999).
|
|
|
|
|
Amended and Restated By-laws of the Company (effective as of December 29, 2007, incorporated by reference to the Company’s annual report on Form 10-K for the year ended December 31, 2007).
|
|
|
|
|
Amendment to the Bylaws of the Company (incorporated by reference to the Company’s report on Form 8-K dated March 3, 2008).
|
|
|
|
4.1
|
|
Stockholders Agreement (incorporated by reference to the Company’s quarterly report on Form 10-Q for the quarterly period ended September 30, 1995).
|
|
|
|
Form of 1999 Long-Term Stock Incentive Plan as amended (incorporated by reference to the Company’s report on Form 8-K dated May 20, 2003).
|
|
|
|
|
Form of 2006 Stock Incentive Plan for Non-Employee Directors (incorporated by reference to the Company’s annual report on Form 10-K for the year ended December 31, 2006).
|
|
|
|
10.3
|
|
Build-to-Suit Lease Agreement dated April 1995 among SYX Distribution Inc. (tenant), American National Bank and Trust Company of Chicago (trustee for the original landlord) and Walsh, Higgins & Company (contractor) (Naperville, IL Facility)(“Naperville Lease”) (incorporated by reference to the Company’s registration statement on Form S-1) (Registration No. 33-92052).
|
|
|
|
First Amendment, dated as of February 1, 2006, to the Naperville Lease between SYX Distribution Inc. (tenant) and Ambassador Drive LLC (landlord) (incorporated by reference to the Company’s annual report on Form 10-K for the year ended December 31, 2005).
|
|
|
|
|
Lease Agreement, dated December 8, 2005, between Global Equipment Company Inc. (tenant) and Hamilton Business Center, LLC (landlord) (Buford, Georgia facility) (the “Buford Lease”) (incorporated by reference to the Company’s annual report on Form 10-K for the year ended December 31, 2005).
|
|
|
|
|
First Amendment, dated June 12, 2006, to the Buford Lease, between Global Equipment Company Inc. (tenant) and Hamilton Business Center, LLC (landlord) (Buford, Georgia distribution center) (incorporated by reference to the Company’s annual report on Form 10-K for the year ended December 31, 2005).
|
|
|
|
|
Employment Agreement, dated as of January 17, 2007, between the Company and Lawrence P. Reinhold (incorporated by reference to the Company’s annual report on Form 10-K for the year ended December 31, 2006).
|
|
|
|
|
Amendment No. 1, dated December 30, 2009, to the Employment Agreement between the Company and Lawrence P. Reinhold (incorporated by reference to the Company’s report on Form 8-K dated December 30, 2009).
|
|
|
|
|
Lease Agreement, dated April 16, 2010, between Jefferson Project I LLC (landlord) and SYX Distribution Inc. (tenant) (Jefferson, GA facility) (the “Jefferson Lease”) (incorporated by reference to the Company’s quarterly report on Form 10-Q for the quarterly period ended March 31, 2012).
|
|
|
|
First Amendment, dated August 24, 2010, to the Jefferson Lease, between Jefferson Project I LLC (landlord) and SYX Distribution Inc. (tenant) (Jefferson, GA facility) (incorporated by reference to the Company’s quarterly report on Form 10-Q for the quarterly period ended March 31, 2012).
|
||
|
|
Lease Agreement, dated February 27, 2012, between PR I Washington Township NJ, LLC (landlord) and Global Equipment Company Inc. (tenant) (Robbinsville, NJ facility) (incorporated by reference to the Company’s quarterly report on Form 10-Q for the quarterly period ended March 31, 2012).
|
||
|
|
Form of 2010 Long Term Incentive Plan (incorporated by reference to the Company’s Definitive Proxy Statement filed April 29, 2010).
|
||
|
|
Employment Agreement, dated April 12, 2012, between the Company and Eric Lerner (incorporated by reference to the Company’s quarterly report on Form 10-Q for the quarterly period ended March 31, 2012).
|
||
|
|
Lease Agreement, dated December 10, 2014, between Prologis, L.P. (landlord) and Global Industrial Distribution Inc. (tenant) (Las Vegas, NV distribution center) (incorporated by reference to the Company’s annual report on Form 10-K for the year ended December 31, 2014).
|
|
|
Amendment to the Term of the 2010 Long Term Incentive Plan (incorporated by reference to the Company’s Supplemental Proxy Material filed May 18, 2015).
|
||
|
|
Third Amended and Restated Credit Agreement dated as of October 28, 2016, by and among Systemax Inc. and certain affiliates thereof and JPMorgan Chase Bank, N.A., as Administrative Agent, Sole Bookrunner and Sole Lead Arranger, and the lenders from time to time party thereto (incorporated by reference to the Company’s report on Form 8-K dated November 3, 2016).
|
||
|
|
Third Amended and Restated Pledge and Security Agreement dated as of October 28, 2016, by and among Systemax Inc. and certain affiliates thereof and JPMorgan Chase Bank, N.A., in its capacity as administrative agent for the lenders party to the Third Amended and Restated Credit Agreement (incorporated by reference to the Company’s report on Form 8-K dated November 3, 2016).
|
||
|
|
Amended and Restated Lease dated December 14, 2016, by and between Global Equipment Company Inc. (tenant) and Addwin Realty Associates, LLC (landlord) (Port Washington, NY facility) (incorporated by reference to the Company’s report on Form 8-K dated December 16, 2016).
|
||
|
|
Corporate Ethics Policy for Officers, Directors and Employees (revised as of February 2018) filed herewith).
|
||
|
|
Subsidiaries of the Registrant (filed herewith).
|
||
|
|
Consent of Independent Registered Public Accounting Firm (filed herewith).
|
||
|
|
Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
|
||
|
|
Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
|
||
|
|
Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
|
||
|
|
Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
|
||
|
101.INS
|
|
XBRL Instance Document
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
SYSTEMAX INC.
|
|
|
|
By: /s/ LAWRENCE REINHOLD
|
|
|
|
Lawrence Reinhold
|
|
President and Chief Executive Officer
|
|
|
|
Date: March 15, 2018
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ RICHARD LEEDS
|
|
Executive Chairman and Director
|
|
March 15, 2018
|
Richard Leeds
|
|
|
|
|
|
|
|
|
|
/s/ BRUCE LEEDS
|
|
Vice Chairman and Director
|
|
March 15, 2018
|
Bruce Leeds
|
|
|
|
|
|
|
|
|
|
/s/ ROBERT LEEDS
|
|
Vice Chairman and Director
|
|
March 15, 2018
|
Robert Leeds
|
|
|
|
|
|
|
|
|
|
/s/ LAWRENCE REINHOLD
|
|
President and Chief Executive Officer
|
|
March 15, 2018
|
Lawrence Reinhold
|
|
and Director
|
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/ THOMAS CLARK
|
|
Vice President and Chief Financial Officer
|
|
March 15, 2018
|
Thomas Clark
|
|
(Principal Financial Officer)
|
|
|
|
|
|
|
|
/s/ THOMAS AXMACHER
|
|
Vice President and Controller
|
|
March 15, 2018
|
Thomas Axmacher
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
|
|
/s/ ROBERT ROSENTHAL
|
|
Director
|
|
March 15, 2018
|
Robert Rosenthal
|
|
|
|
|
|
|
|
|
|
/s/ BARRY LITWIN
|
|
Director
|
|
March 15, 2018
|
Barry Litwin
|
|
|
|
|
|
|
|
|
|
/s/ CHAD LINDBLOOM
|
|
Director
|
|
March 15, 2018
|
Chad Lindbloom
|
|
|
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
ASSETS:
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash
|
$
|
184.5
|
|
|
$
|
149.7
|
|
Accounts receivable, net of allowances of $9.9 and $17.2
|
174.3
|
|
|
148.6
|
|
||
Inventories
|
131.5
|
|
|
116.7
|
|
||
Prepaid expenses and other current assets
|
3.8
|
|
|
3.9
|
|
||
Current assets of discontinued operations
|
—
|
|
|
92.3
|
|
||
Total current assets
|
494.1
|
|
|
511.2
|
|
||
|
|
|
|
||||
Property, plant and equipment, net
|
15.1
|
|
|
16.4
|
|
||
Deferred income taxes
|
26.2
|
|
|
4.2
|
|
||
Goodwill and intangibles
|
14.5
|
|
|
15.7
|
|
||
Other assets
|
1.5
|
|
|
1.5
|
|
||
Long term assets of discontinued operations
|
—
|
|
|
17.1
|
|
||
Total assets
|
$
|
551.4
|
|
|
$
|
566.1
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY:
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
196.1
|
|
|
$
|
181.3
|
|
Dividend payable
|
55.7
|
|
|
—
|
|
||
Accrued expenses and other current liabilities
|
64.0
|
|
|
49.2
|
|
||
Current liabilities of discontinued operations
|
—
|
|
|
94.5
|
|
||
Total current liabilities
|
315.8
|
|
|
325.0
|
|
||
|
|
|
|
||||
Deferred income tax liability
|
0.1
|
|
|
0.3
|
|
||
Other liabilities
|
23.7
|
|
|
24.3
|
|
||
Long term liabilities of discontinued operations
|
—
|
|
|
2.1
|
|
||
Total liabilities
|
339.6
|
|
|
351.7
|
|
||
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
|
|
||
|
|
|
|
|
|
||
Shareholders’ equity:
|
|
|
|
|
|
||
Preferred stock, par value $.01 per share, authorized 25 million shares; issued none
|
|
|
|
|
|
||
Common stock, par value $.01 per share, authorized 150 million shares; issued 38,861,992 and 38,861,992 shares; outstanding 37,093,774 and 36,924,293 shares
|
0.4
|
|
|
0.4
|
|
||
Additional paid-in capital
|
186.5
|
|
|
185.5
|
|
||
Treasury stock at cost —1,768,218 and 1,937,699 shares
|
(21.8
|
)
|
|
(23.9
|
)
|
||
Retained earnings
|
44.8
|
|
|
73.1
|
|
||
Accumulated other comprehensive income (loss)
|
1.9
|
|
|
(20.7
|
)
|
||
Total shareholders’ equity
|
211.8
|
|
|
214.4
|
|
||
|
|
|
|
||||
Total liabilities and shareholders’ equity
|
$
|
551.4
|
|
|
$
|
566.1
|
|
|
Year Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Net sales
|
$
|
1,265.4
|
|
|
1,170.3
|
|
|
$
|
1,243.5
|
|
|
Cost of sales
|
914.0
|
|
|
862.4
|
|
|
933.0
|
|
|||
Gross profit
|
351.4
|
|
|
307.9
|
|
|
310.5
|
|
|||
Selling, distribution and administrative expenses
|
279.8
|
|
|
276.3
|
|
|
287.1
|
|
|||
Special charges, net
|
0.3
|
|
|
3.9
|
|
|
26.9
|
|
|||
Operating income (loss) from continuing operations
|
71.3
|
|
|
27.7
|
|
|
(3.5
|
)
|
|||
Foreign currency exchange loss
|
—
|
|
|
1.3
|
|
|
7.5
|
|
|||
Interest and other expense, net
|
0.5
|
|
|
0.3
|
|
|
0.7
|
|
|||
Income (loss) from continuing operations before income taxes
|
70.8
|
|
|
26.1
|
|
|
(11.7
|
)
|
|||
(Benefit) provision for income taxes
|
(5.3
|
)
|
|
9.2
|
|
|
12.3
|
|
|||
Net income (loss) from continuing operations
|
76.1
|
|
|
16.9
|
|
|
(24.0
|
)
|
|||
Loss from discontinued operations, net of tax
|
(35.7
|
)
|
|
(49.5
|
)
|
|
(75.8
|
)
|
|||
Net income (loss)
|
$
|
40.4
|
|
|
$
|
(32.6
|
)
|
|
$
|
(99.8
|
)
|
Basic and diluted EPS:
|
|
|
|
|
|
|
|
|
|||
Net income (loss) per share from continuing operations-basic
|
$
|
2.06
|
|
|
$
|
0.45
|
|
|
$
|
(0.65
|
)
|
Net income (loss) per share from continuing operations-diluted
|
$
|
2.02
|
|
|
$
|
0.45
|
|
|
$
|
(0.65
|
)
|
Net loss per share from discontinued operations-basic and diluted
|
$
|
(0.96
|
)
|
|
$
|
(1.33
|
)
|
|
$
|
(2.04
|
)
|
Net income per share-basic
|
$
|
1.09
|
|
|
$
|
(0.88
|
)
|
|
$
|
2.69
|
|
Net income per share-diluted
|
$
|
1.07
|
|
|
$
|
(0.88
|
)
|
|
$
|
2.69
|
|
Weighted average common and common equivalent shares:
|
|
|
|
|
|
|
|
|
|||
Basic
|
37.0
|
|
|
37.2
|
|
|
37.1
|
|
|||
Diluted
|
37.6
|
|
|
37.2
|
|
|
37.1
|
|
|||
Dividends declared
|
1.85
|
|
|
0.10
|
|
|
—
|
|
|
Year Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Net income (loss)
|
$
|
40.4
|
|
|
$
|
(32.6
|
)
|
|
$
|
(99.8
|
)
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
|||
Foreign currency translation income (loss)
|
8.2
|
|
|
(4.9
|
)
|
|
(6.9
|
)
|
|||
Total comprehensive income (loss)
|
$
|
48.6
|
|
|
$
|
(37.5
|
)
|
|
$
|
(106.7
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
||||||
Net income (loss) from continuing operations
|
$
|
76.1
|
|
|
$
|
16.9
|
|
|
$
|
(24.0
|
)
|
Adjustments to reconcile income (loss) from continuing operations to net cash provided by (used in) operating activities:
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
5.1
|
|
|
5.3
|
|
|
5.9
|
|
|||
Asset impairment and other non-cash benefit
|
—
|
|
|
(0.2
|
)
|
|
1.0
|
|
|||
(Benefit) provision for deferred income taxes
|
(17.8
|
)
|
|
4.1
|
|
|
4.3
|
|
|||
Provision for returns and doubtful accounts
|
1.3
|
|
|
3.6
|
|
|
6.7
|
|
|||
Compensation expense related to equity compensation plans
|
1.6
|
|
|
1.7
|
|
|
0.9
|
|
|||
(Gain) loss on dispositions and abandonment
|
(0.1
|
)
|
|
(4.3
|
)
|
|
(0.1
|
)
|
|||
|
|
|
|
|
|
||||||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|||
Accounts receivable
|
(13.7
|
)
|
|
24.2
|
|
|
39.0
|
|
|||
Inventories
|
(9.6
|
)
|
|
6.6
|
|
|
139.8
|
|
|||
Prepaid expenses and other current assets
|
1.5
|
|
|
5.5
|
|
|
1.5
|
|
|||
Income taxes payable (receivable)
|
6.3
|
|
|
(0.2
|
)
|
|
0.8
|
|
|||
Accounts payable
|
2.9
|
|
|
(73.2
|
)
|
|
(43.1
|
)
|
|||
Accrued expenses and other current liabilities
|
4.3
|
|
|
(13.6
|
)
|
|
(4.0
|
)
|
|||
Net cash provided by (used in) operating activities from continuing operations
|
57.9
|
|
|
(23.6
|
)
|
|
128.7
|
|
|||
Net cash used in operating activities from discontinued operations
|
(12.3
|
)
|
|
(33.8
|
)
|
|
(42.2
|
)
|
|||
Net cash provided by (used in) operating activities
|
45.6
|
|
|
(57.4
|
)
|
|
86.5
|
|
|||
|
|
|
|
|
|
||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|||
Purchases of property, plant and equipment
|
(2.8
|
)
|
|
(2.4
|
)
|
|
(10.0
|
)
|
|||
Proceeds from disposals of property, plant and equipment
|
0.1
|
|
|
0.5
|
|
|
1.4
|
|
|||
Acquisition of Plant Equipment Group
|
—
|
|
|
—
|
|
|
(24.8
|
)
|
|||
Net cash used in investing activities from continuing operations
|
(2.7
|
)
|
|
(1.9
|
)
|
|
(33.4
|
)
|
|||
Net cash used in investing activities from discontinued operations
|
(0.1
|
)
|
|
(0.8
|
)
|
|
(1.3
|
)
|
|||
Net cash used in investing activities
|
(2.8
|
)
|
|
(2.7
|
)
|
|
(34.7
|
)
|
|||
|
|
|
|
|
|
||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|||
Repayments of capital lease obligations
|
(0.1
|
)
|
|
(0.3
|
)
|
|
(2.7
|
)
|
|||
Dividends paid
|
(13.0
|
)
|
|
(3.7
|
)
|
|
—
|
|
|||
Proceeds from issuance of common stock
|
2.4
|
|
|
—
|
|
|
—
|
|
|||
Payment of payroll taxes on stock-based compensation through shares withheld
|
(0.8
|
)
|
|
—
|
|
|
—
|
|
|||
Repurchase of treasury stock
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|||
Net cash used in financing activities from continuing operations
|
(11.5
|
)
|
|
(4.0
|
)
|
|
(2.9
|
)
|
|||
Net cash used in financing activities from discontinued operations
|
—
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|||
Net cash used in financing activities
|
(11.5
|
)
|
|
(4.1
|
)
|
|
(3.0
|
)
|
|||
|
|
|
|
|
|
||||||
EFFECTS OF EXCHANGE RATES ON CASH
|
3.5
|
|
|
(1.2
|
)
|
|
1.3
|
|
|||
|
|
|
|
|
|
||||||
NET INCREASE (DECREASE) IN CASH
|
34.8
|
|
|
(65.4
|
)
|
|
50.1
|
|
|||
CASH – BEGINNING OF YEAR
|
149.7
|
|
|
215.1
|
|
|
165.0
|
|
|||
|
|
|
|
|
|
||||||
CASH – END OF YEAR
|
$
|
184.5
|
|
|
$
|
149.7
|
|
|
$
|
215.1
|
|
Supplemental disclosures:
|
|
|
|
|
|
|
|
|
Interest paid
|
$
|
0.4
|
|
|
$
|
0.7
|
|
|
$
|
0.7
|
|
Income taxes paid
|
$
|
5.8
|
|
|
$
|
5.8
|
|
|
$
|
4.1
|
|
Supplemental disclosures of non-cash investing and financing activities:
|
|
|
|
|
|
|
|
|
|||
Acquisitions of equipment through capital leases
|
$
|
0.3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
|
Number
of Shares
Outstanding
|
|
Amount
|
|
Additional
Paid-in
Capital
|
|
Treasury
Stock,
At Cost
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Total Equity
|
|||||||||||||
Balances, December 31, 2014
|
36,808
|
|
|
$
|
0.4
|
|
|
$
|
184.3
|
|
|
$
|
(25.4
|
)
|
|
$
|
209.2
|
|
|
$
|
(8.9
|
)
|
|
$
|
359.6
|
|
Stock-based compensation expense
|
|
|
|
|
|
|
1.2
|
|
|
|
|
|
|
|
|
|
|
|
1.2
|
|
||||||
Issuance of restricted stock
|
86
|
|
|
|
|
|
(1.1
|
)
|
|
1.1
|
|
|
|
|
|
|
|
|
—
|
|
||||||
Exercise of stock options
|
4
|
|
|
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
—
|
|
||||||
Surrender of fully vested options
|
(25
|
)
|
|
|
|
|
|
|
(0.2
|
)
|
|
|
|
|
|
|
|
(0.2
|
)
|
|||||||
Change in cumulative translation adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6.9
|
)
|
|
(6.9
|
)
|
||||||
Net loss
|
|
|
|
|
|
|
|
|
|
|
|
|
(99.8
|
)
|
|
|
|
|
(99.8
|
)
|
||||||
Balances, December 31, 2015
|
36,873
|
|
|
$
|
0.4
|
|
|
$
|
184.4
|
|
|
$
|
(24.5
|
)
|
|
$
|
109.4
|
|
|
$
|
(15.8
|
)
|
|
253.9
|
|
|
Stock-based compensation expense
|
|
|
|
|
|
|
1.7
|
|
|
|
|
|
|
|
|
|
|
|
1.7
|
|
||||||
Issuance of restricted stock
|
51
|
|
|
|
|
|
(0.6
|
)
|
|
0.6
|
|
|
|
|
|
|
|
|
—
|
|
||||||
Dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
(3.7
|
)
|
|
|
|
|
(3.7
|
)
|
||||||
Change in cumulative translation adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4.9
|
)
|
|
(4.9
|
)
|
||||||
Net loss
|
|
|
|
|
|
|
|
|
|
|
|
|
(32.6
|
)
|
|
|
|
|
(32.6
|
)
|
||||||
Balances, December 31, 2016
|
36,924
|
|
|
$
|
0.4
|
|
|
$
|
185.5
|
|
|
$
|
(23.9
|
)
|
|
$
|
73.1
|
|
|
$
|
(20.7
|
)
|
|
$
|
214.4
|
|
Stock-based compensation expense
|
|
|
|
|
|
|
1.6
|
|
|
|
|
|
|
|
|
|
|
|
1.6
|
|
||||||
Issuance of restricted stock
|
68
|
|
|
|
|
|
(0.8
|
)
|
|
0.8
|
|
|
|
|
|
|
|
|
—
|
|
||||||
Stock withheld for employee taxes
|
(48
|
)
|
|
|
|
|
(0.3
|
)
|
|
(0.5
|
)
|
|
|
|
|
|
|
|
(0.8
|
)
|
||||||
Cancellation of restricted shares
|
(8
|
)
|
|
|
|
|
—
|
|
|
(0.1
|
)
|
|
|
|
|
|
|
|
(0.1
|
)
|
||||||
Proceeds from issuance of common stock
|
158
|
|
|
|
|
|
0.5
|
|
|
1.9
|
|
|
|
|
|
|
|
|
2.4
|
|
||||||
Dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
(68.7
|
)
|
|
|
|
|
(68.7
|
)
|
||||||
Discontinued European entities cumulative translation adjustment
|
|
|
|
|
|
|
|
|
|
|
14.4
|
|
|
14.4
|
|
|||||||||||
Change in cumulative translation adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8.2
|
|
|
8.2
|
|
||||||
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
40.4
|
|
|
|
|
|
40.4
|
|
||||||
Balances, December 31, 2017
|
37,094
|
|
|
$
|
0.4
|
|
|
$
|
186.5
|
|
|
$
|
(21.8
|
)
|
|
$
|
44.8
|
|
|
$
|
1.9
|
|
|
$
|
211.8
|
|
|
Year Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Net sales
|
$
|
117.0
|
|
|
$
|
521.6
|
|
|
$
|
1,664.6
|
|
Cost of sales
|
102.9
|
|
|
461.6
|
|
|
1,516.8
|
|
|||
Gross profit
|
14.1
|
|
|
60.0
|
|
|
147.8
|
|
|||
Selling, distribution and administrative expenses
|
22.1
|
|
|
96.9
|
|
|
221.0
|
|
|||
Special charges, net
|
30.6
|
|
|
11.5
|
|
|
2.6
|
|
|||
Operating loss from discontinued operations
|
(38.6
|
)
|
|
(48.4
|
)
|
|
(75.8
|
)
|
|||
Foreign currency exchange loss
|
0.8
|
|
|
—
|
|
|
1.8
|
|
|||
Interest and other expense (income), net
|
—
|
|
|
0.3
|
|
|
0.3
|
|
|||
Loss of discontinued operations before income taxes
|
(39.4
|
)
|
|
(48.7
|
)
|
|
(77.9
|
)
|
|||
Provision (benefit) for income tax
|
(3.7
|
)
|
|
0.8
|
|
|
(2.1
|
)
|
|||
Net loss from discontinued operations
|
$
|
(35.7
|
)
|
|
$
|
(49.5
|
)
|
|
$
|
(75.8
|
)
|
Net loss per share - basic and diluted
|
$
|
(0.96
|
)
|
|
$
|
(1.33
|
)
|
|
$
|
(2.04
|
)
|
|
ETG - Severance and other costs
|
|
ETG – Lease
liabilities and
other costs
|
|
NATG – Workforce
reductions
|
|
NATG – Lease
liabilities and
other exit costs
|
|
Total
|
||||||||||
Balance January 1, 2017
|
$
|
—
|
|
|
$
|
1.2
|
|
|
$
|
—
|
|
|
$
|
19.3
|
|
|
$
|
20.5
|
|
Charged to expense
|
0.3
|
|
|
—
|
|
|
—
|
|
|
6.5
|
|
|
6.8
|
|
|||||
Paid or otherwise settled
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
(6.8
|
)
|
|
(7.1
|
)
|
|||||
Balance December 31, 2017
|
$
|
—
|
|
|
$
|
1.2
|
|
|
$
|
—
|
|
|
$
|
19.0
|
|
|
$
|
20.2
|
|
|
ETG -
Workforce
Reductions and
Personnel Costs
|
|
ETG – Lease
liabilities and other costs |
|
NATG-
Workforce
Reductions
|
|
NATG – Lease
liabilities and other exit costs |
|
Total
|
||||||||||
Balance, January 1, 2016
|
$
|
0.3
|
|
|
$
|
—
|
|
|
$
|
2.7
|
|
|
$
|
16.3
|
|
|
$
|
19.3
|
|
Charged to expense
|
—
|
|
|
1.9
|
|
|
0.2
|
|
|
16.9
|
|
|
19.0
|
|
|||||
Paid or otherwise settled
|
(0.3
|
)
|
|
(0.7
|
)
|
|
(2.9
|
)
|
|
(13.9
|
)
|
|
(17.8
|
)
|
|||||
Balance, December 31, 2016
|
$
|
—
|
|
|
$
|
1.2
|
|
|
$
|
—
|
|
|
$
|
19.3
|
|
|
$
|
20.5
|
|
|
December 31,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
Balance, January 1
|
$
|
7.6
|
|
|
$
|
9.2
|
|
Impairment
|
—
|
|
|
(0.4
|
)
|
||
Reclassified to discontinued operations due to sale
|
—
|
|
|
(1.2
|
)
|
||
Balance, December 31
|
$
|
7.6
|
|
|
$
|
7.6
|
|
|
December 31,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
Balance, January 1
|
$
|
0.7
|
|
|
$
|
0.7
|
|
France trademark
|
1.8
|
|
|
—
|
|
||
Balance, December 31
|
$
|
2.5
|
|
|
$
|
0.7
|
|
|
|
|
|
|
December 31, 2017
|
||||||||||||||
|
Amortization
Period (Years) |
|
Gross Carrying
Amount |
|
Accumulated
Amortization |
|
Net Book Value
|
|
Weighted avg
useful life |
||||||
Client lists
|
5-10 yrs
|
|
$
|
2.3
|
|
|
$
|
0.9
|
|
|
$
|
1.4
|
|
|
7.0
|
Leases
|
3-6 yrs
|
|
0.8
|
|
|
0.4
|
|
|
0.4
|
|
|
3.1
|
|||
Domain name
|
5 yrs
|
|
3.4
|
|
|
0.8
|
|
|
2.6
|
|
|
3.8
|
|||
Total
|
|
|
$
|
6.5
|
|
|
$
|
2.1
|
|
|
$
|
4.4
|
|
|
4.8
|
|
December 31, 2016
|
||||||||||||||
|
Amortization
Period (Years) |
|
Gross Carrying
Amount |
|
Accumulated
Amortization |
|
Net Book Value
|
|
Weighted avg
useful life |
||||||
Client lists
|
5-10 yrs
|
|
$
|
2.3
|
|
|
$
|
0.6
|
|
|
$
|
1.7
|
|
|
8.0
|
Leases
|
3-6 yrs
|
|
0.8
|
|
|
0.3
|
|
|
0.5
|
|
|
4.1
|
|||
Domain name
|
5 yrs
|
|
3.4
|
|
|
0.2
|
|
|
3.2
|
|
|
4.8
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
Total
|
|
|
$
|
6.5
|
|
|
$
|
1.1
|
|
|
$
|
5.4
|
|
|
5.7
|
2018
|
$
|
1.0
|
|
2019
|
1.0
|
|
|
2020
|
1.1
|
|
|
2021
|
0.7
|
|
|
2022 and after
|
$
|
0.6
|
|
Total
|
$
|
4.4
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Land improvements
|
$
|
0.8
|
|
|
$
|
0.8
|
|
Furniture and fixtures, office, computer and other equipment and software
|
48.8
|
|
|
47.1
|
|
||
Leasehold improvements
|
16.8
|
|
|
14.6
|
|
||
|
66.4
|
|
|
62.5
|
|
||
Less accumulated depreciation and amortization
|
51.3
|
|
|
46.1
|
|
||
Property, plant and equipment, net
|
$
|
15.1
|
|
|
$
|
16.4
|
|
|
2017
|
|
2016
|
||||
Office, computer and other equipment
|
$
|
6.0
|
|
|
$
|
5.7
|
|
Less: Accumulated amortization
|
5.6
|
|
|
5.4
|
|
||
|
$
|
0.4
|
|
|
$
|
0.3
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Payroll and employee benefits
|
$
|
23.1
|
|
|
$
|
18.6
|
|
Advertising
|
6.5
|
|
|
6.3
|
|
||
Sales and VAT tax payable
|
4.7
|
|
|
3.4
|
|
||
Freight
|
4.0
|
|
|
3.2
|
|
||
Reorganization costs
|
8.1
|
|
|
7.6
|
|
||
Income taxes payable
|
7.6
|
|
|
0.6
|
|
||
Other
|
10.0
|
|
|
9.5
|
|
||
|
$
|
64.0
|
|
|
$
|
49.2
|
|
|
2017
|
|
2016
|
|
2015
|
|||
Expected annual dividend yield
|
2.4
|
%
|
|
—
|
%
|
|
—
|
%
|
Risk-free interest rate
|
2.26
|
%
|
|
1.64
|
%
|
|
1.73
|
%
|
Expected volatility
|
48.9
|
%
|
|
44.4
|
%
|
|
40.2
|
%
|
Expected life in years
|
4.00
|
|
|
7.10
|
|
|
6.30
|
|
|
Weighted Average
|
||||||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||||||||||||||
|
Shares
|
|
Weighted
Avg. Exercise Price |
|
Shares
|
|
Weighted
Avg. Exercise Price |
|
Shares
|
|
Weighted
Avg. Exercise Price |
||||||||||||
Outstanding at beginning of year
|
1,410,250
|
|
|
$
|
12.57
|
|
|
954,625
|
|
|
$
|
15.98
|
|
|
1,127,250
|
|
|
$
|
16.12
|
|
|||
Granted
|
10,000
|
|
|
$
|
24.36
|
|
|
670,000
|
|
|
$
|
8.43
|
|
|
25,000
|
|
|
$
|
10.62
|
|
|||
Exercised
|
(138,450
|
)
|
|
$
|
13.49
|
|
|
—
|
|
|
$
|
—
|
|
|
(4,000
|
)
|
|
$
|
6.30
|
|
|||
Cancelled or expired
|
(280,500
|
)
|
|
$
|
16.04
|
|
|
(214,375
|
)
|
|
$
|
14.86
|
|
|
(193,625
|
)
|
|
$
|
16.29
|
|
|||
Outstanding at end of year
|
1,001,300
|
|
|
$
|
11.58
|
|
|
1,410,250
|
|
|
$
|
12.57
|
|
|
954,625
|
|
|
$
|
15.98
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Options exercisable at year end
|
588,802
|
|
|
|
|
|
750,250
|
|
|
|
|
|
832,125
|
|
|
|
|
||||||
Weighted average fair value per option granted during the year
|
$
|
10.69
|
|
|
|
|
|
$
|
3.94
|
|
|
|
|
|
$
|
4.44
|
|
|
|
|
Range of Exercise Prices
|
|
Number
Exercisable
|
|
Weighted
Average
Exercise
Price
|
|
Weighted Average
Remaining
Contractual Life
|
|
Aggregate
Intrinsic
Value (in
millions)
|
|||||||||||
$
|
5.00
|
|
to
|
$
|
10.00
|
|
|
505,738
|
|
|
$
|
8.53
|
|
|
8.34
|
|
$
|
12.5
|
|
$
|
10.01
|
|
to
|
$
|
15.00
|
|
|
306,375
|
|
|
$
|
13.00
|
|
|
2.63
|
|
6.2
|
|
|
$
|
15.01
|
|
to
|
$
|
20.00
|
|
|
156,600
|
|
|
$
|
18.32
|
|
|
4.47
|
|
2.3
|
|
|
$
|
20.01
|
|
to
|
$
|
24.36
|
|
|
10,000
|
|
|
$
|
24.36
|
|
|
9.61
|
|
0.1
|
|
|
$
|
5.00
|
|
to
|
$
|
24.36
|
|
|
978,713
|
|
|
$
|
11.66
|
|
|
5.94
|
|
$
|
21.1
|
|
|
Shares
|
|
Weighted
Average Grant-
Date Fair Value
|
|||
Unvested at January 1, 2017
|
660,000
|
|
|
$
|
4.02
|
|
Granted
|
10,000
|
|
|
$
|
10.69
|
|
Vested
|
(176,252
|
)
|
|
$
|
4.84
|
|
Forfeited
|
(81,250
|
)
|
|
$
|
3.21
|
|
Unvested at December 31, 2017
|
412,498
|
|
|
$
|
4.93
|
|
|
Year Ended December 31,
|
|||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
Income tax at Federal statutory rate
|
$
|
24.8
|
|
|
35.0
|
%
|
|
$
|
9.1
|
|
|
35.0
|
%
|
|
$
|
(4.1
|
)
|
|
35.0
|
%
|
Foreign taxes at rates different from the U.S. rate
|
1.1
|
|
|
1.6
|
%
|
|
0.8
|
|
|
3.1
|
%
|
|
1.4
|
|
|
(12.0
|
)%
|
|||
State and local income taxes, net of federal tax benefit
|
5.0
|
|
|
7.1
|
%
|
|
(0.7
|
)
|
|
(2.7
|
)%
|
|
(1.4
|
)
|
|
12.0
|
%
|
|||
Impact of state rate changes
|
0.3
|
|
|
0.5
|
%
|
|
1.4
|
|
|
5.3
|
%
|
|
0.7
|
|
|
(6.0
|
)%
|
|||
Changes in valuation allowances
|
(21.7
|
)
|
|
(30.7
|
)%
|
|
(1.2
|
)
|
|
(4.6
|
)%
|
|
15.9
|
|
|
(135.8
|
)%
|
|||
Reversal of valuation allowances
|
(29.4
|
)
|
|
(41.5
|
)%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
2017 TCJA, net deferred tax remeasurment and repatriation tax impacts
|
15.7
|
|
|
22.1
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Non-deductible items
|
(0.4
|
)
|
|
(0.6
|
)%
|
|
(0.3
|
)
|
|
(1.2
|
)%
|
|
—
|
|
|
—
|
%
|
|||
Other items, net
|
(0.7
|
)
|
|
(1.0
|
)%
|
|
0.1
|
|
|
0.4
|
%
|
|
(0.2
|
)
|
|
1.7
|
%
|
|||
Income tax
|
$
|
(5.3
|
)
|
|
(7.5
|
)%
|
|
$
|
9.2
|
|
|
35.3
|
%
|
|
$
|
12.3
|
|
|
(105.1
|
)%
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Assets:
|
|
|
|
||||
Accrued expenses and other liabilities
|
$
|
5.9
|
|
|
$
|
12.1
|
|
Inventory
|
1.1
|
|
|
1.5
|
|
||
Depreciation
|
1.4
|
|
|
0.6
|
|
||
Intangible & other
|
8.1
|
|
|
13.2
|
|
||
Net operating loss and credit carryforwards
|
28.6
|
|
|
46.5
|
|
||
Valuation allowances
|
(18.9
|
)
|
|
(69.7
|
)
|
||
Total non-current deferred tax assets
|
26.2
|
|
|
4.2
|
|
||
Liabilities:
|
|
|
|
|
|
||
Non-current:
|
|
|
|
|
|
||
Other
|
$
|
0.1
|
|
|
$
|
0.3
|
|
Total non-current liabilities
|
$
|
0.1
|
|
|
$
|
0.3
|
|
|
Capital
Leases
|
|
Operating
Leases
|
|
Total
|
||||||
2018
|
$
|
0.1
|
|
|
$
|
20.9
|
|
|
$
|
21.0
|
|
2019
|
0.1
|
|
|
15.5
|
|
|
15.6
|
|
|||
2020
|
—
|
|
|
14.2
|
|
|
14.2
|
|
|||
2021
|
—
|
|
|
10.9
|
|
|
10.9
|
|
|||
2022
|
—
|
|
|
9.6
|
|
|
9.6
|
|
|||
2023-2027
|
—
|
|
|
38.3
|
|
|
38.3
|
|
|||
2028-2032
|
—
|
|
|
17.2
|
|
|
17.2
|
|
|||
Thereafter
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total minimum lease payments
|
0.2
|
|
|
126.6
|
|
|
126.8
|
|
|||
Less: sublease rental income
|
—
|
|
|
6.3
|
|
|
6.3
|
|
|||
Lease obligation net of subleases
|
0.2
|
|
|
$
|
120.3
|
|
|
$
|
120.5
|
|
|
Less: amount representing interest
|
—
|
|
|
|
|
|
|
|
|||
Present value of minimum capital lease payments (including current portion of $0.2M)
|
$
|
0.2
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Net Sales:
|
|
|
|
|
|
||||||
IPG
|
$
|
791.8
|
|
|
$
|
715.6
|
|
|
$
|
698.6
|
|
ETG
|
473.6
|
|
|
451.1
|
|
|
441.7
|
|
|||
NATG
|
—
|
|
|
—
|
|
|
97.8
|
|
|||
Corporate and other
|
—
|
|
|
3.6
|
|
|
5.4
|
|
|||
Consolidated
|
$
|
1,265.4
|
|
|
$
|
1,170.3
|
|
|
$
|
1,243.5
|
|
Depreciation and Amortization Expense:
|
|
|
|
|
|
|
|
|
|||
IPG
|
$
|
3.9
|
|
|
$
|
3.6
|
|
|
$
|
3.8
|
|
ETG
|
0.5
|
|
|
0.8
|
|
|
0.5
|
|
|||
NATG
|
—
|
|
|
—
|
|
|
0.6
|
|
|||
Corporate and other
|
0.7
|
|
|
0.9
|
|
|
1.0
|
|
|||
Consolidated
|
$
|
5.1
|
|
|
$
|
5.3
|
|
|
$
|
5.9
|
|
|
|
|
|
|
|
||||||
Operating Income (Loss):
|
|
|
|
|
|
|
|
|
|||
IPG
|
$
|
69.6
|
|
|
$
|
34.3
|
|
|
$
|
43.7
|
|
ETG
|
24.5
|
|
|
14.5
|
|
|
13.0
|
|
|||
NATG
|
(0.6
|
)
|
|
(2.8
|
)
|
|
(38.2
|
)
|
|||
Corporate and other expenses
|
(22.2
|
)
|
|
(18.3
|
)
|
|
(22.0
|
)
|
|||
Consolidated
|
$
|
71.3
|
|
|
$
|
27.7
|
|
|
$
|
(3.5
|
)
|
|
|
|
|
|
|
||||||
Total Assets
|
|
|
|
|
|
|
|
|
|||
IPG
|
$
|
220.4
|
|
|
$
|
201.5
|
|
|
$
|
203.8
|
|
ETG
|
188.0
|
|
|
165.2
|
|
|
140.5
|
|
|||
ETG - discontinued
|
—
|
|
|
109.4
|
|
|
166.4
|
|
|||
NATG
|
13.6
|
|
|
6.9
|
|
|
151.6
|
|
|||
Corporate and other
|
129.4
|
|
|
83.1
|
|
|
47.8
|
|
|||
Consolidated
|
$
|
551.4
|
|
|
$
|
566.1
|
|
|
$
|
710.1
|
|
|
Year Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Net Sales:
|
|
|
|
|
|
||||||
United States
|
$
|
759.4
|
|
|
$
|
692.3
|
|
|
$
|
676.8
|
|
France
|
473.6
|
|
|
417.2
|
|
|
382.6
|
|
|||
Other Europe
|
—
|
|
|
33.9
|
|
|
59.1
|
|
|||
Other North America
|
32.4
|
|
|
26.9
|
|
|
125.0
|
|
|||
Consolidated
|
$
|
1,265.4
|
|
|
$
|
1,170.3
|
|
|
$
|
1,243.5
|
|
|
|
|
|
|
|
||||||
Long-lived Assets:
|
|
|
|
|
|
|
|
|
|||
United States
|
$
|
13.9
|
|
|
$
|
15.4
|
|
|
$
|
18.1
|
|
France
|
1.2
|
|
|
1.0
|
|
|
1.1
|
|
|||
Other Europe and Asia
|
—
|
|
|
—
|
|
|
0.1
|
|
|||
Consolidated
|
$
|
15.1
|
|
|
$
|
16.4
|
|
|
$
|
19.3
|
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
2017
|
|
|
|
|
|
|
|
||||||||
Net sales
|
$
|
302.5
|
|
|
$
|
313.0
|
|
|
$
|
319.3
|
|
|
$
|
330.6
|
|
Gross profit
|
$
|
81.8
|
|
|
$
|
91.5
|
|
|
$
|
89.6
|
|
|
$
|
88.5
|
|
Net income from continuing operations
|
$
|
10.3
|
|
|
$
|
19.3
|
|
|
$
|
14.1
|
|
|
$
|
32.4
|
|
Net income per common share from continuing operations:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
$
|
0.29
|
|
|
$
|
0.52
|
|
|
$
|
0.38
|
|
|
$
|
0.87
|
|
Diluted
|
$
|
0.28
|
|
|
$
|
0.52
|
|
|
$
|
0.37
|
|
|
$
|
0.85
|
|
|
|
|
|
|
|
|
|
||||||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net sales
|
$
|
286.8
|
|
|
$
|
297.7
|
|
|
$
|
290.2
|
|
|
$
|
295.6
|
|
Gross profit
|
$
|
75.9
|
|
|
$
|
78.0
|
|
|
$
|
75.7
|
|
|
$
|
78.3
|
|
Net income from continuing operations
|
$
|
1.5
|
|
|
$
|
2.3
|
|
|
$
|
1.6
|
|
|
$
|
11.5
|
|
Net income per common share from continuing operations:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
$
|
0.04
|
|
|
$
|
0.06
|
|
|
$
|
0.04
|
|
|
$
|
0.31
|
|
Diluted
|
$
|
0.04
|
|
|
$
|
0.06
|
|
|
$
|
0.04
|
|
|
$
|
0.31
|
|
Description
|
|
Balance at
Beginning of
Period
|
|
Charged to
Expenses
|
|
Write-offs
|
|
Other
|
|
Balance at
End of Period
|
|
||||||||||
Allowance for doubtful accounts
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
2017
|
|
$
|
10.0
|
|
|
$
|
1.3
|
|
|
$
|
(9.2
|
)
|
|
$
|
—
|
|
|
$
|
2.1
|
|
(1)
|
2016
|
|
$
|
7.2
|
|
|
$
|
3.6
|
|
|
$
|
(0.8
|
)
|
|
$
|
—
|
|
|
$
|
10.0
|
|
(2)
|
2015
|
|
$
|
3.7
|
|
|
$
|
6.7
|
|
|
$
|
(3.4
|
)
|
|
$
|
0.2
|
|
|
$
|
7.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for sales returns
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
2017
|
|
$
|
1.6
|
|
|
$
|
1.8
|
|
|
$
|
—
|
|
|
$
|
(1.6
|
)
|
(3)
|
$
|
1.8
|
|
|
2016
|
|
$
|
3.5
|
|
|
$
|
1.6
|
|
|
$
|
—
|
|
|
$
|
(3.5
|
)
|
(3)
|
$
|
1.6
|
|
|
2015
|
|
$
|
7.8
|
|
|
$
|
3.5
|
|
|
$
|
—
|
|
|
$
|
(7.8
|
)
|
(3)
|
$
|
3.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for inventory returns
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
2017
|
|
$
|
(0.8
|
)
|
|
$
|
(0.9
|
)
|
|
$
|
—
|
|
|
$
|
0.8
|
|
(3)
|
$
|
(0.9
|
)
|
|
2016
|
|
$
|
(2.7
|
)
|
|
$
|
(0.8
|
)
|
|
$
|
—
|
|
|
$
|
2.7
|
|
(3)
|
$
|
(0.8
|
)
|
|
2015
|
|
$
|
(6.4
|
)
|
|
$
|
(2.7
|
)
|
|
$
|
—
|
|
|
$
|
6.4
|
|
(3)
|
$
|
(2.7
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for deferred tax assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
2017
|
|
$
|
69.7
|
|
|
$
|
(28.6
|
)
|
|
$
|
(3.0
|
)
|
|
$
|
(19.2
|
)
|
|
$
|
18.9
|
|
|
2016
|
|
$
|
64.0
|
|
|
$
|
6.0
|
|
|
$
|
(1.9
|
)
|
|
$
|
1.6
|
|
|
$
|
69.7
|
|
|
2015
|
|
$
|
35.8
|
|
|
$
|
28.6
|
|
|
$
|
—
|
|
|
$
|
(0.4
|
)
|
|
$
|
64.0
|
|
|
|
|
(1)
|
Excludes approximately
$0.4 million
of reserves related to non-trade receivables.
|
(2)
|
Excludes approximately
$5.6 million
of reserves related to notes receivable and tax refund receivables.
|
(3)
|
Amounts represent gross revenue and cost reversals to the estimated sales returns and allowances accounts.
|
1 Year Systemax Chart |
1 Month Systemax Chart |
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