Financial Performance - Net sales for the three months ended March 28, 2020, were $765.3 million, an increase of 6.5% compared to $718.8 million for the same period in 2019[10] - Gross profit for the six months ended March 28, 2020, was $419.3 million, up 5.6% from $396.9 million in the prior year[10] - Net earnings for the three months ended March 28, 2020, were $49.7 million, representing a 21.5% increase from $41.1 million in the same period last year[10] - Basic net earnings per share for the three months ended March 28, 2020, were $1.49, compared to $1.18 for the same period in 2019, reflecting a 26.3% increase[10] - Net earnings for the six months ended March 28, 2020, were $99,772,000, compared to $83,828,000 for the same period in 2019, representing a growth of approximately 19.0%[25] - Comprehensive income for the three months ended March 28, 2020, was $31.3 million, down from $48.1 million in the same period last year[13] - Operating profit for the three months ended March 28, 2020, was $84.1 million, compared to $77.9 million for the same period in 2019, reflecting an increase of 8.9%[108] - The total operating profit for the six months ended March 28, 2020, was $174.8 million, compared to $157.2 million for the same period in 2019, reflecting a growth of 11.2%[108] Assets and Liabilities - Total assets as of March 28, 2020, were $3.38 billion, an increase from $3.11 billion as of September 28, 2019[16] - Total liabilities increased to $2.14 billion as of March 28, 2020, compared to $1.79 billion as of September 28, 2019[16] - Cash, cash equivalents, and restricted cash at the end of the period were $119,265,000, up from $112,072,000 at the end of the same period in 2019, showing an increase of about 6.2%[25] - Total receivables increased to $1,007,730 as of March 28, 2020, from $957,287 in September 28, 2019[61] - Inventories increased to $589,493 as of March 28, 2020, compared to $534,974 in September 28, 2019[62] - Goodwill increased to $810,354 as of March 28, 2020, from $784,240 in September 28, 2019[72] - Long-term debt as of March 28, 2020, totaled $1,093,966, an increase of 31.3% from $832,984 as of September 28, 2019[76] Cash Flow and Investments - Net cash provided by operating activities for the six months ended March 28, 2020, was $80,704,000, down from $108,848,000 in the prior year, indicating a decrease of about 26.0%[25] - The company reported a net cash used by investing activities of $111,434,000 for the six months ended March 28, 2020, compared to $57,524,000 in the same period of 2019, reflecting an increase of approximately 93.5%[25] - The company issued treasury shares as compensation amounting to $9,063,000 for the six months ended March 28, 2020, compared to $11,795,000 in the prior year[26] - The company used $54 million for the acquisition of GAT and $53 million for capital expenditures in the first half of 2020[162] Dividends and Shareholder Equity - The company declared dividends of $0.25 per share for both the three months ended March 28, 2020, and March 30, 2019[10] - Total shareholders' equity as of March 28, 2020, was $1,245,678 million, reflecting no change from the previous reporting period[38] - Cash dividends declared and paid were $0.25 per share for both Class A and Class B common stock in the first and second quarters of 2020 and 2019[105] Research and Development - Research and development expenses for the three months ended March 28, 2020, were $26.7 million, a decrease of 14.3% from $31.3 million in the same period last year[10] - Research and development expenses decreased by 15% in Q2 2020 to $27 million, down from $31 million in Q2 2019[137] Market and Operational Insights - The defense market remains stable with military spending not significantly impacted by the COVID-19 pandemic, although future spending levels are uncertain[186] - The commercial aircraft market is experiencing a shift from wide-body to longer range narrow-body aircraft due to reduced air traffic and financial pressures on airlines caused by the COVID-19 pandemic[187] - The demand for maintenance services and spare parts is expected to decrease substantially in the short term due to dramatic reductions in flight hours and cash preservation measures by airlines[188] - The industrial automation market is constrained by unfavorable economic conditions, which have affected supply chains, productivity, and customer demand[191] - The medical market has seen an unprecedented demand for medical equipment, particularly ventilators, due to the COVID-19 pandemic, leading to increased orders for critical motion control components[194] Tax and Pension Expenses - The effective tax rate for the three months ended March 28, 2020, was 19.2%, lower than the previous year's rate of 23.8% due to tax reductions in foreign jurisdictions[97][98] - U.S. defined benefit pension plans expense for the three months ended March 28, 2020, was $8,749 million, a decrease from $9,926 million in the same period of 2019[95] - Non-U.S. defined benefit pension plans expense for the three months ended March 28, 2020, was $2,438 million, an increase from $1,680 million in the same period of 2019[95] Revenue Recognition - The over-time method of revenue recognition was predominantly used in Aircraft Controls and Space and Defense Controls, with 65% and 64% of revenue recognized over time for the three and six months ended March 28, 2020, respectively[49] - Revenue recognized at the point in time control was transferred to the customer was 35% and 36% for the three and six months ended March 28, 2020[54] - The company recognized lower revenues of $4,941 million and higher revenues of $9,678 million for adjustments made to performance obligations in the three and six months ended March 28, 2020, respectively[50] Future Outlook - The company is committed to maintaining adequate liquidity during the COVID-19 crisis, focusing on financial health and operational performance[124] - The company has established adequate reserves for environmental legal proceedings and does not expect these matters to materially affect financial conditions[111] - The company plans to adopt ASU no. 2018-15 for capitalizing implementation costs of cloud computing arrangements in Q1 2021[31]
Moog(MOG_A) - 2020 Q2 - Quarterly Report