v2.3.0.11
Document and Entity Information (USD $)
6 Months Ended
Oct. 01, 2011
Nov. 04, 2011
Sep. 30, 2011
Document and Entity Information      
Entity Registrant Name BLACK BOX Corporation    
Entity Central Index Key 0000849547    
Document Type 10-Q    
Document Period End Date Oct. 01, 2011
Amendment Flag false    
Document Fiscal Year Focus 2012    
Document Fiscal Period Focus Q2    
Current Fiscal Year End Date --03-31    
Entity Current Reporting Status Yes    
Entity Well Known Seasoned Issuer No    
Entity Voluntary Filers No    
Entity Filer Category Accelerated Filer    
Entity Common Stock, Shares Outstanding   17,680,326  
Entity Public Float     $ 375,118,048
v2.3.0.11
Consolidated Balance Sheets (USD $)
In Thousands
Oct. 01, 2011
Mar. 31, 2011
Assets    
Cash and cash equivalents $ 27,856 $ 31,212 [1]
Accounts receivable, net of allowance for doubtful accounts of $6,424 and $7,121 172,425 156,682 [1]
Inventories, net 62,953 52,014 [1]
Costs/estimated earnings in excess of billings on uncompleted contracts 108,717 103,853 [1]
Other assets 27,710 27,483 [1]
Total current assets 399,661 371,244 [1]
Property, plant and equipment, net 24,825 23,427 [1]
Goodwill 658,321 650,024 [1]
Intangibles, net 119,684 120,133 [1]
Other assets 5,623 7,155 [1]
Total assets 1,208,114 1,171,983 [1]
Liabilities    
Accounts payable 88,565 71,463 [1]
Accrued compensation and benefits 27,895 35,329 [1]
Deferred revenue 33,721 36,043 [1]
Billings in excess of costs/estimated earnings on uncompleted contracts 18,116 17,462 [1]
Income taxes 14,724 11,957 [1]
Other liabilities 35,594 34,395 [1]
Total current liabilities 218,615 206,649 [1]
Long-term debt 194,381 181,127 [1]
Other liabilities 19,384 17,948 [1]
Total liabilities 432,380 405,724 [1]
Stockholders' Equity    
Preferred stock authorized 5,000, par value $1.00, none issued 0 0 [1]
Common stock authorized 100,000, par value $.001, 17,680 and 17,918 shares outstanding, 25,730 and 25,561 shares issued 26 26 [1]
Additional paid-in capital 474,897 470,367 [1]
Retained earnings 621,890 599,923 [1]
Accumulated other comprehensive income 12,314 19,523 [1]
Treasury stock, at cost 8,050 and 7,643 shares (333,393) (323,580) [1]
Total stockholders’ equity 775,734 766,259 [1]
Total liabilities and stockholders’ equity $ 1,208,114 $ 1,171,983 [1]
[1] Derived from audited financial statements
v2.3.0.11
Consolidated Balance Sheets (Parenthetical) (USD $)
In Thousands, except Per Share data
Oct. 01, 2011
Mar. 31, 2011
Assets    
Allowance for doubtful accounts $ 6,424 $ 7,121 [1]
Stockholders' Equity    
Preferred stock, par value $ 1.00 $ 1.00 [1]
Preferred stock, shares authorized 5,000 5,000 [1]
Preferred stock, shares issued 0 0 [1]
Preferred stock, shares outstanding 0 0 [1]
Common stock, par value $ 0.001 $ 0.001 [1]
Common stock, shares authorized 100,000 100,000 [1]
Common stock, shares issued 25,730 25,561 [1]
Common stock, shares outstanding 17,680 17,918 [1]
Treasury stock, shares 8,050 7,643 [1]
[1] Derived from audited financial statements
v2.3.0.11
Consolidated Statements of Income (USD $)
In Thousands, except Per Share data
3 Months Ended 6 Months Ended
Oct. 01, 2011
Oct. 02, 2010
Oct. 01, 2011
Oct. 02, 2010
Revenues        
Products $ 50,329 $ 46,415 $ 98,048 $ 92,464
On-Site services 236,842 226,509 457,549 444,056
Total 287,171 272,924 555,597 536,520
Cost of sales        
Products 27,660 [1] 25,018 [1] 53,927 [1] 49,836 [1]
On-Site services 170,645 [1] 157,786 [1] 326,223 [1] 306,950 [1]
Total 198,305 [1] 182,804 [1] 380,150 [1] 356,786 [1]
Gross profit 88,866 90,120 175,447 179,734
Selling, general & administrative expenses 63,256 63,534 129,900 127,154
Intangibles amortization 3,176 3,058 6,235 6,160
Operating income 22,434 23,528 39,312 46,420
Interest expense (income), net 769 1,742 1,834 3,432
Other expenses (income), net 273 (66) 565 (65)
Income before provision for income taxes 21,392 21,852 36,913 43,053
Provision for income taxes 6,548 8,302 12,446 16,359
Net income $ 14,844 $ 13,550 $ 24,467 $ 26,694
Earnings per common share        
Basic $ 0.83 $ 0.77 $ 1.37 $ 1.52
Diluted $ 0.83 $ 0.77 $ 1.36 $ 1.51
Weighted-average common shares outstanding        
Basic 17,858 17,607 17,917 17,574
Diluted 17,865 17,694 17,968 17,646
Dividends per share $ 0.07 $ 0.06 $ 0.14 $ 0.12
[1] Exclusive of depreciation and intangibles amortization
v2.3.0.11
Consolidated Statements of Cash Flows (USD $)
In Thousands
6 Months Ended
Oct. 01, 2011
Oct. 02, 2010
Operating Activities    
Net income $ 24,467 $ 26,694
Adjustments to reconcile net income to net cash provided by (used for) operating activities    
Intangibles amortization and depreciation 9,034 9,296
Loss (gain) on sale of property (142) (17)
Deferred taxes (550) 1,273
Stock compensation expense 5,418 5,506
Change in fair value of interest-rate swaps (1,516) (846)
Changes in operating assets and liabilities (net of acquisitions)    
Accounts receivable, net (13,373) (14,103)
Inventories, net (11,286) (1,757)
Costs/estimated earnings in excess of billings on uncompleted contracts (4,613) (17,085)
All other assets 362 (4,167)
Billings in excess of costs/estimated earnings on uncompleted contracts 559 5,078
All other liabilities 4,896 (1,733)
Net cash provided by (used for) operating activities 13,256 8,139
Investing Activities    
Capital expenditures (4,034) (1,885)
Capital disposals 144 45
Acquisition of businesses (payments)/recoveries (13,188) 0
Prior merger-related (payments)/recoveries (336) (1,683)
Net cash provided by (used for) investing activities (17,414) (3,523)
Financing Activities    
Proceeds from borrowings 121,074 103,930
Repayment of borrowings (107,978) (107,887)
Deferred financing costs 0 0
Purchase of treasury stock (9,813) (482)
Proceeds from the exercise of stock options 0 280
Payment of dividends (2,337) (2,109)
Net cash provided by (used for) financing activities 946 (6,268)
Foreign currency exchange impact on cash (144) 987
Increase / (decrease) in cash and cash equivalents (3,356) (665)
Cash and cash equivalents at beginning of period 31,212 [1] 20,885
Cash and cash equivalents at end of period 27,856 20,220
Supplemental Cash Flow    
Cash paid for interest 3,966 4,346
Cash paid for income taxes 10,308 9,917
Non-cash financing activities    
Dividends payable 1,238 1,057
Capital leases $ 23 $ 121
[1] Derived from audited financial statements
v2.3.0.11
Business and Basis of Presentation
6 Months Ended
Oct. 01, 2011
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Business and Basis of Presentation
Business and Basis of Presentation

Business
Black Box Corporation ("Black Box" or the "Company") is a leading communications system integrator dedicated to designing, sourcing, implementing and maintaining today's complex communications solutions. The Company's primary service offering is voice communications solutions ("Voice Communications"); the Company also offers premise cabling and other data-related services ("Data Infrastructure") and technology product solutions (“Technology Products”). The Company provides 24/7/365 technical support for all its solutions, which encompass all major voice and data product manufacturers as well as an extensive range of technology products that it sells through its catalog and Internet Web site and its Voice Communications and Data Infrastructure (collectively referred to as "On-Site services") offices. As of October 1, 2011, the Company had more than 3,000 professional technical experts in 198 offices serving more than 175,000 clients in 141 countries throughout the world. Founded in 1976, Black Box, a Delaware corporation, operates subsidiaries on five continents and is headquartered near Pittsburgh in Lawrence, Pennsylvania.

Basis of Presentation
The accompanying unaudited interim consolidated financial statements of Black Box have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The Company believes that these consolidated financial statements reflect all normal, recurring adjustments needed to present fairly the Company’s results for the interim periods presented. The results as of and for interim periods may not be indicative of the results of operations for any other interim period or for the full year. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s most recent Annual Report on Form 10-K as filed with the Securities and Exchange Commission ("SEC") for the fiscal year ended March 31, 2011 (the "Form 10-K").

The Company’s fiscal year ends on March 31. The fiscal quarters consist of 13 weeks and end on the Saturday generally nearest each calendar quarter end, adjusted to provide relatively equivalent business days for each fiscal quarter. The actual ending dates for the periods presented in these Notes to the Consolidated Financial Statements as of September 30, 2011 and 2010 were October 1, 2011 and October 2, 2010. References herein to "Fiscal Year" or "Fiscal" mean the Company’s fiscal year ended March 31 for the year referenced. All references to dollar amounts herein are presented in thousands, except per share amounts, unless otherwise noted.

The consolidated financial statements include the accounts of the parent company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Certain items in the consolidated financial statements of prior years have been reclassified to conform to the current year's presentation.

The preparation of financial statements in conformity with GAAP requires Company management ("Management") to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates in these financial statements include project progress towards completion to estimated budget, allowances for doubtful accounts receivable, sales returns, net realizable value of inventories, loss contingencies, warranty reserves, intangible assets and goodwill. Actual results could differ from those estimates. Management believes the estimates made are reasonable.
v2.3.0.11
Significant Accounting Policies / Recent Accounting Pronouncements
6 Months Ended
Oct. 01, 2011
Significant Accounting Policies and Recent Accounting Pronouncements [Abstract]  
Significant Accounting Policies
Significant Accounting Policies / Recent Accounting Pronouncements

Significant Accounting Policies
The significant accounting policies used in the preparation of the Company’s consolidated financial statements are disclosed in Note 2 of the Notes to the Consolidated Financial Statements within the Form 10-K. No additional significant accounting policies have been adopted during Fiscal 2012.

Recent Accounting Pronouncements
There have been no accounting pronouncements adopted during Fiscal 2012 that had a material impact on the Company's consolidated financial statements. There have been no new accounting pronouncements issued but not yet adopted that are expected to have a material impact on the Company's consolidated financial statements.
v2.3.0.11
Inventories
6 Months Ended
Oct. 01, 2011
Inventory Disclosure [Abstract]  
Inventories
Inventories

The Company’s Inventories consist of the following:
 
September 30, 2011

March 31, 2011

Raw materials
$
1,389

$
1,294

Finished goods
81,011

70,579

Inventory, gross
82,400

71,873

Excess and obsolete inventory reserves
(19,447
)
(19,859
)
Inventory, net
$
62,953

$
52,014


v2.3.0.11
Goodwill
6 Months Ended
Oct. 01, 2011
Goodwill [Abstract]  
Goodwill
Goodwill

The following table summarizes changes to Goodwill at the Company’s reportable segments for the periods presented:
 
North America

Europe

All Other

Total

Balance at March 31, 2011
$
574,964

$
72,752

$
2,308

$
650,024

Currency translation
(54
)
(3,400
)
(167
)
(3,621
)
Current period acquisitions (see Note 9)
8,021



8,021

Prior period acquisitions (see Note 9)
3,897



3,897

Balance at September 30, 2011
$
586,828

$
69,352

$
2,141

$
658,321


At and since October 2, 2010 (the date of the Company's annual goodwill impairment assessment in Fiscal 2011), the Company's stock market capitalization has been lower than its net book value. However, each of the Company's reporting segments continues to operate profitably and generate significant cash flow from operations, and the Company expects that each will continue to do so throughout the remainder of Fiscal 2012 and beyond. In addition, the Company believes that a reasonable potential buyer would offer a control premium for the business that would adequately cover the difference between the recent stock trading prices and the net book value.

v2.3.0.11
Intangible Assets
6 Months Ended
Oct. 01, 2011
Intangible Assets, Net (Excluding Goodwill) [Abstract]  
Intangible Assets
Intangible Assets

The following table summarizes the gross carrying amount, accumulated amortization and net carrying amount by intangible asset class for the periods presented:
 
September 30, 2011
March 31, 2011
 
Gross Carrying Amount

Accum. Amort.

Net Carrying Amount

Gross Carrying Amount

Accum. Amort.

Net Carrying Amount

Definite-lived
 
 
 
 
 
 
Non-compete agreements
$
11,801

$
9,625

$
2,176

$
10,660

$
9,332

$
1,328

Customer relationships
130,890

41,121

89,769

126,367

35,301

91,066

Acquired backlog
17,349

17,349


17,349

17,349


Total
$
160,040

$
68,095

$
91,945

$
154,376

$
61,982

$
92,394

Indefinite-lived
 
 
 
 
 
 
Trademarks
35,992

8,253

27,739

35,992

8,253

27,739

Total
$
196,032

$
76,348

$
119,684

$
190,368

$
70,235

$
120,133


The Company’s indefinite-lived intangible assets consist solely of the Company’s trademark portfolio. The Company’s definite-lived intangible assets are comprised of employee non-compete agreements, customer relationships and backlog obtained through business acquisitions.

The following table summarizes the changes to the net carrying amounts of intangible assets for the periods presented:
 
Trademarks

Non-Competes and Backlog

Customer Relationships

Total

Balance at March 31, 2011
$
27,739

$
1,328

$
91,066

$
120,133

Amortization expense

(415
)
(5,820
)
(6,235
)
Currency translation

(3
)

(3
)
Current period acquisitions (see Note 9)

1,266

4,523

5,789

Balance at September 30, 2011
$
27,739

$
2,176

$
89,769

$
119,684


Intangibles amortization was $3,176 and $3,058 for the three (3) months ended September 30, 2011 and 2010, respectively, and $6,235 and $6,160 for the six (6) months ended September 30, 2011 and 2010, respectively. The Company acquired definite-lived intangibles from the completion of several acquisitions during Fiscal 2011 and 2010.

The following table details the estimated intangibles amortization expense for the remainder of Fiscal 2012, each of the succeeding four (4) fiscal years and the periods thereafter. These estimates are based on the carrying amounts of intangible assets as of September 30, 2011 that are provisional measurements of fair value and are subject to change pending the outcome of purchase accounting related to certain acquisitions:
Fiscal
 
2012
$
6,447

2013
11,966

2014
10,782

2015
9,646

2016
9,375

Thereafter
43,729

Total
$
91,945

v2.3.0.11
Indebtedness
6 Months Ended
Oct. 01, 2011
Debt Disclosure [Abstract]  
Indebtedness
Indebtedness

The Company’s Long-term debt consists of the following:
 
September 30, 2011

March 31, 2011

Revolving credit agreement
$
194,140

$
180,646

Other
837

1,213

Total debt
$
194,977

$
181,859

Less: current portion (included in Other liabilities)
(596
)
(732
)
Long-term debt
$
194,381

$
181,127


Revolving Credit Agreement
On January 30, 2008, the Company entered into a Third Amended and Restated Credit Agreement dated as of January 30, 2008 with Citizens Bank of Pennsylvania, as agent, and a group of lenders and, on October 8, 2010, the Company entered into the First Amendment to Credit Agreement primarily to permit the Company to make certain joint venture investments (as amended, the "Credit Agreement"). The Credit Agreement expires on January 30, 2013. Borrowings under the Credit Agreement are permitted up to a maximum amount of $350,000, which includes up to $20,000 of swing-line loans and $25,000 of letters of credit. The Credit Agreement may be increased by the Company up to an additional $100,000 with the approval of the lenders and may be unilaterally and permanently reduced by the Company to not less than the then outstanding amount of all borrowings. Interest on outstanding indebtedness under the Credit Agreement accrues, at the Company’s option, at a rate based on either: (a) the greater of (i) the prime rate per annum of the agent then in effect and (ii) 0.50% plus the rate per annum announced by the Federal Reserve Bank of New York as being the weighted-average of the rates on overnight Federal funds transactions arranged by Federal funds brokers on the previous trading day or (b) a rate per annum equal to the LIBOR rate plus 0.50% to 1.125% (determined by a leverage ratio based on the Company’s consolidated Earnings Before Interest Taxes Depreciation and Amortization ("EBITDA")). The Credit Agreement requires the Company to maintain compliance with certain non-financial and financial covenants such as leverage and fixed-charge coverage ratios. As of September 30, 2011, the Company was in compliance with all financial covenants under the Credit Agreement.
The maximum amount of debt outstanding under the Credit Agreement, the weighted-average balance outstanding under the Credit Agreement and the weighted-average interest rate on all outstanding debt for the three (3) months ended September 30, 2011 was $216,180, $203,889 and 1.0%, respectively, compared to $237,255, $225,510 and 1.3%, respectively, for the three (3) months ended September 30, 2010. The maximum amount of debt outstanding under the Credit Agreement, the weighted-average balance outstanding under the Credit Agreement and the weighted-average interest rate on all outstanding debt for the six (6) months ended September 30, 2011 was $216,180, $191,726 and 1.1%, respectively, compared to $237,255, $222,595 and 1.3%, respectively, for the six (6) months ended September 30, 2010.

Other
Other debt is comprised of capital lease obligations primarily for equipment and other third-party, non-employee loans.

Unused available borrowings
As of September 30, 2011, the Company had $4,050 outstanding in letters of credit and $151,810 in unused commitments under the Credit Agreement.

v2.3.0.11
Derivative Instruments and Hedging Activities
6 Months Ended
Oct. 01, 2011
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments and Hedging Activities
Derivative Instruments and Hedging Activities

The Company is exposed to certain market risks, including the effect of changes in foreign currency exchange rates and interest rates. The Company uses derivative instruments to manage financial exposures that occur in the normal course of business. It does not hold or issue derivatives for speculative trading purposes. The Company is exposed to non-performance risk from the counterparties in its derivative instruments. This risk would be limited to any unrealized gains on current positions. To help mitigate this risk, the Company transacts only with counterparties that are rated as investment grade or higher and all counterparties are monitored on a continuous basis. The fair value of the Company’s derivatives reflects this credit risk.

Foreign currency contracts
The Company enters into foreign currency contracts to hedge exposure to variability in expected fluctuations in foreign currencies. Foreign currency assets and liabilities are translated into U.S. dollars at the rate of exchange existing at the period-end date. Adjustments resulting from these translations are recorded in Accumulated Other Comprehensive Income ("AOCI") within the Company’s Consolidated Balance Sheets and will be included in income upon sale or liquidation of the foreign investment. As of September 30, 2011, the Company had open contracts in Australian and Canadian dollars, Danish krone, Euros, Mexican pesos, Norwegian kroner, British pounds sterling, Swedish krona, Swiss francs and Japanese yen which have been designated as cash flow hedges. These contracts had a notional amount of $55,416 and will expire within twelve (12) months. There was no hedge ineffectiveness during Fiscal 2012 or Fiscal 2011.

Interest-rate Swaps
On May 24, 2006, the Company entered into a five-year floating-to-fixed interest-rate swap, with an effective date of July 26, 2006, that is based on a 3-month LIBOR rate versus a 5.44% fixed rate and has a notional value of $100,000 (which reduced to $50,000 as of July 26, 2009 and terminated on July 26, 2011). On June 15, 2009, the Company entered into a three-year floating-to-fixed interest-rate swap, with an effective date of July 27, 2009, that is based on a 3-month LIBOR rate versus a 2.28% fixed rate and has a notional value of $100,000 (which reduced to $50,000 on July 27, 2011). On May 19, 2011, the Company entered into a one-year floating-to-fixed interest-rate swap, with an effective date of July 26, 2011, that is based on a 3-month LIBOR rate versus a 0.58% fixed rate and has a notional value of $75,000. Each interest-rate swap discussed above does not qualify for hedge accounting and is, together with the other interest-rate swaps discussed above, collectively hereinafter referred to as the "interest-rate swaps."

The following tables detail the effect of derivative instruments on the Company’s Consolidated Balance Sheets and Consolidated Statements of Income for the periods presented:
 
 
Asset Derivatives
Liability Derivatives
 
Classification
September 30,
2011

March 31,
2011

September 30,
2011

March 31,
2011

Derivatives designated as hedging instruments
 

 

 

 

Foreign currency contracts
Other liabilities (current)
$

$

$
1,808

$
278

Foreign currency contracts
Other assets (current)
$
427

$
1,919

$

$

Derivatives not designated as hedging instruments
 

 

 

 

Interest-rate swaps
Other liabilities (current)
$

$

$
788

$
2,303

 
 
Three (3) months ended
Six (6) months ended
 
 
September 30
September 30
 
Classification
2011

2010

2011

2010

Derivatives designated as hedging instruments
 
 

 

 
 
Gain (loss) recognized in Comprehensive income on (effective portion) – net of taxes
Other comprehensive income
$
332

$
(107
)
$
173

$
(452
)
(Gain) loss reclassified from AOCI into income (effective portion) – net of taxes
Selling, general &
administrative expenses
$
25

$
190

$
212

$
318

Derivatives not designated as hedging instruments
 
 
 




Gain (loss) recognized in income
Interest expense (income), net
$
604

$
314

$
1,516

$
846

v2.3.0.11
Fair Value Disclosures
6 Months Ended
Oct. 01, 2011
Fair Value Disclosures [Abstract]  
Fair Value Disclosures
Fair Value Disclosures

Recurring fair value measurements
The following table presents information about the Company’s assets and liabilities measured at fair value on a recurring basis as of September 30, 2011, and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value:
 
Assets at Fair Value as of
 
September 30, 2011
 
Level 1

Level 2

Level 3

Total

Foreign currency contracts
$

$
427

$

$
427

 
Liabilities at Fair Value as of
 
September 30, 2011
 
Level 1

Level 2

Level 3

Total

Foreign currency contracts
$

$
1,808

$

$
1,808

Interest-rate swaps

788


788

Total
$

$
2,596

$

$
2,596


Non-recurring fair value measurements
The Company's assets and liabilities that are measured at fair value on a non-recurring basis include non-financial assets and liabilities initially measured at fair value in a business combination. As disclosed in Note 9, the Company completed an acquisition during the six (6) months ended September 30, 2011 which included operating assets, liabilities and certain intangible assets. The Company utilized level 2 and level 3 inputs to measure the fair value of these items.
v2.3.0.11
Acquisitions
6 Months Ended
Oct. 01, 2011
Business Combinations [Abstract]  
Acquisitions
Acquisitions

Fiscal 2012
During the second quarter of Fiscal 2012, the Company acquired PS Technologies, LLC ("PS Tech"), a privately-held company headquartered in Dayton, OH. PS Tech is the first Black Box acquisition in the rapidly-growing enterprise video communications market and services clients in the healthcare and government verticals.

The acquisition of PS Tech did not have a material impact on the Company’s consolidated financial statements.

Fiscal 2011
During the third quarter of Fiscal 2011, the Company acquired LOGOS Communications Systems, Inc. ("Logos"), a privately-held company headquartered in Westlake, OH. Logos has an active client base which includes commercial, education and various local government agency accounts.

Also during the third quarter of Fiscal 2011, the Company acquired a non-controlling interest in Genesis Networks Integration Services, LLC, a new joint venture company which was formed in conjunction with Genesis Networks Enterprises, LLC ("Genesis"). This new joint venture company, based on Genesis’ existing Networks Integration Services Division, strengthens and enhances Genesis’ ability to deliver and support voice and data communications solutions to its enterprise clients.

The acquisition of Logos and the non-controlling interest in Genesis Networks Integration Services, LLC did not have a material impact on the Company’s consolidated financial statements.

The fair values of assets acquired and liabilities assumed for PS Tech and Logos are provisional and are based on the information that was available as of the acquisition date to estimate the fair value of assets acquired and liabilities assumed. The Company believes that the information available provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed but additional information not yet available is necessary to finalize those fair values. Thus, the provisional measurements of fair value are subject to change. The Company expects to finalize the valuation and complete the purchase price allocation as soon as practicable but no later than one-year from the acquisition date.

The results of operations of PS Tech and Logos are included within the Company’s Consolidated Statements of Income beginning on the acquisition date.
v2.3.0.11
Income Taxes
6 Months Ended
Oct. 01, 2011
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes

The Company recorded income tax expense of $6,548, an effective tax rate of 30.6%, and $8,302, an effective tax rate of 38.0%, for the three (3) months ended September 30, 2011 and 2010, respectively, and $12,446, an effective tax rate of 33.7%, and $16,359, an effective tax rate of 38.0%, for the six (6) months ended September 30, 2011 and 2010, respectively. The effective rate for the six (6) months ended September 30, 2011 of 33.7% differs from the federal statutory rate primarily due to a $1,579 reduction in the Company's provision for income taxes related to an agreement with the Internal Revenue Service ("IRS") in the second quarter of Fiscal 2012 to conclude the previously-disclosed IRS audit for Fiscal 2007 through Fiscal 2010 and foreign earnings taxed at a lower statutory rate partially offset by state income taxes and the write-off of certain deferred tax assets related to equity awards.

The Company provides for income taxes at the end of each interim period based on the estimated effective tax rate adjusted for certain discreet items (see above for the $1,579 income tax provision reduction during the second quarter of Fiscal 2012 related to a previously-disclosed IRS audit) for the full fiscal year. Cumulative adjustments to the Company's estimate are recorded in the interim period in which a change in the estimated annual effective rate is determined.

Fiscal 2007 through Fiscal 2010 remain open to examination by state and foreign taxing jurisdictions.
v2.3.0.11
Stock-based Compensation
6 Months Ended
Oct. 01, 2011
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-based Compensation
Stock-based Compensation

In August 2008, the Company’s stockholders approved the 2008 Long-Term Incentive Plan (the "Incentive Plan") which replaces the 1992 Stock Option Plan, as amended, and the 1992 Director Stock Option Plan, as amended. As of September 30, 2011, the Incentive Plan is authorized to issue stock options, restricted stock units and performance shares, among other types of awards, for up to 2,810,872 shares of common stock, par value $.001 per share (the "common stock").

The Company recognized stock-based compensation expense of $2,046 and $2,504 for the three (3) months ended September 30, 2011 and 2010, respectively, $5,418 and $5,506 for the six (6) months ended September 30, 2011 and 2010, respectively. The Company recognized total income tax benefit for stock-based compensation arrangements of $751 and $916 for the three (3) months ended September 30, 2011 and 2010, respectively, and $1,988 and $2,014 for the six (6) months ended September 30, 2011 and 2010, respectively. Stock-based compensation expense is recorded in Selling, general & administrative expense within the Company’s Consolidated Statements of Income.

Stock options
Stock option awards are granted with an exercise price equal to the closing market price of the common stock on the date of grant; such stock options generally become exercisable in equal amounts over a three-year period and have a contractual life of ten (10) years from the grant date. The fair value of stock options is estimated on the grant date using the Black-Scholes option pricing model which includes the following weighted-average assumptions.
 
Six (6) months ended
 
September 30
 
2011

2010

Expected life (in years)
4.8

4.9

Risk free interest rate
1.7
%
2.3
%
Annual forfeiture rate
2.1
%
2.1
%
Volatility
45.3
%
41.4
%
Dividend yield
0.7
%
0.8
%

The following table summarizes the Company’s stock option activity for the period presented and as of September 30, 2011:
 
Shares (in 000’s)

Weighted-Average Exercise Price

Weighted-Average Remaining Contractual Life (Years)

Intrinsic Value (000’s)

Outstanding at March 31, 2011
2,901

$
35.65

 
 
Granted
180

32.39

 
 
Exercised


 
 
Forfeited or expired
(224
)
41.80

 
 
Outstanding at September 30, 2011
2,857

$
34.96

5.2

$

Exercisable at September 30, 2011
2,463

$
35.37

4.6

$


The weighted-average grant-date fair value of options granted during the six (6) months ended September 30, 2011 and 2010 was $12.42 and $11.69, respectively. The total intrinsic value of options exercised during the six (6) months ended September 30, 2011 and 2010 was $0 and $32, respectively. The aggregate intrinsic value in the preceding table is based on the closing stock price of the common stock on September 30, 2011 of $21.35.

The following table summarizes certain information regarding the Company’s non-vested stock options for the period presented:
 
Shares (in 000’s)

Weighted-Average Grant-Date Fair Value

Non-vested at March 31, 2011
690

$
10.32

Granted
180

12.42

Forfeited


Vested
(476
)
9.61

Non-vested at September 30, 2011
394

$
12.14


As of September 30, 2011, there was $3,718 of total unrecognized pre-tax stock-based compensation expense related to non-vested stock options which is expected to be recognized over a weighted-average period of 1.9 years.

Restricted stock units
Restricted stock unit awards are subject to a service condition and generally vest in equal amounts over a three-year period from the grant date. The fair value of restricted stock units is determined based on the number of restricted stock units granted and the closing market price of the common stock on the date of grant.

The following table summarizes the Company’s restricted stock unit activity for the period presented:
 
Shares (in 000’s)

Weighted-Average Grant-Date Fair Value

Outstanding at March 31, 2011
248

$
29.97

Granted
163

32.39

Vested
(118
)
30.19

Forfeited
(6
)
31.09

Outstanding at September 30, 2011
287

$
31.23


The total fair value of shares that vested during the six (6) months ended September 30, 2011 and 2010 was $3,553 and $1,985, respectively.

As of September 30, 2011, there was $6,953 of total unrecognized pre-tax stock-based compensation expense related to non-vested restricted stock units which is expected to be recognized over a weighted-average period of 2.0 years.

Performance share awards
Performance share awards are subject to certain performance goals including the Company’s Relative Total Shareholder Return ("TSR") Ranking and cumulative Adjusted EBITDA over a three (3) year period. The Company’s Relative TSR Ranking metric is based on the three (3) year cumulative return to shareholders from the change in stock price and dividends paid between the starting and ending dates. The fair value of performance share awards (subject to cumulative Adjusted EBITDA) is determined based on the number of performance shares granted and the closing market price of the common stock on the date of grant. The fair value of performance share awards (subject to the Company’s Relative TSR Ranking) is estimated on the grant date using the Monte-Carlo simulation which includes the following weighted-average assumptions.
 
Six (6) months ended
 
September 30
 
2011

2010

Expected Volatility
50.8
%
52.3
%
Risk free interest rate
0.9
%
1.4
%
Dividend yield
0.7
%
0.8
%

The following table summarizes the Company’s performance share award activity for the period presented:
 
Shares (in 000’s)

Weighted-Average Grant-Date Fair Value

Outstanding at March 31, 2011
179

$
33.13

Granted
110

34.15

Vested
(52
)
30.87

Forfeited
(50
)
35.23

Outstanding at September 30, 2011
187

$
33.77


The total fair value of shares that vested during the six (6) months ended September 30, 2011 and 2010 was $1,679 and $0, respectively.

As of September 30, 2011, there was $4,284 of total unrecognized pre-tax stock-based compensation expense related to non-vested performance share awards which is expected to be recognized over a weighted-average period of 2.3 years.
v2.3.0.11
Earnings Per Share
6 Months Ended
Oct. 01, 2011
Earnings Per Share [Abstract]  
Earnings Per Share
Earnings Per Share

The following table details the computation of basic and diluted earnings per common share from continuing operations for the periods presented (share numbers in thousands):
 
Three (3) months ended
Six (6) months ended
 
September 30
September 30
 
2011

2010

2011

2010

Net income
$
14,844

$
13,550

$
24,467

$
26,694

Weighted-average common shares outstanding (basic)
17,858

17,607

17,917

17,574

Effect of dilutive securities from equity awards
7

87

51

72

Weighted-average common shares outstanding (diluted)
17,865

17,694

17,968

17,646

Basic earnings per common share
$
0.83

$
0.77

$
1.37

$
1.52

Dilutive earnings per common share
$
0.83

$
0.77

$
1.36

$
1.51

 
 
 
 
 

The Weighted-average common shares outstanding (diluted) computation is not impacted during any period where the exercise price of a stock option is greater than the average market price. There were 3,426,856 and 2,677,536 non-dilutive equity awards outstanding for the three (3) months ended September 30, 2011 and 2010, respectively, and 2,613,124 and 2,525,053 non-dilutive equity awards outstanding for the six (6) months ended September 30, 2011 and 2010, respectively, that are not included in the corresponding period Weighted-average common shares outstanding (diluted) computation.
v2.3.0.11
Comprehensive Income and AOCI
6 Months Ended
Oct. 01, 2011
Comprehensive Income and AOCI [Abstract]  
Comprehensive Income and AOCI
Comprehensive income and AOCI

The following table details the computation of comprehensive income for the periods presented:
 
Three (3) months ended
Six (6) months ended
 
September 30
September 30
 
2011

2010

2011

2010

Net income
$
14,844

$
13,550

$
24,467

$
26,694

Foreign currency translation adjustment
(10,842
)
12,282

(7,723
)
5,936

Derivative instruments (net of tax)
 
 
 
 
Net change in fair value of cash flow hedging instruments (net of tax)
332

(107
)
173

(452
)
Amounts reclassified into results of operations
25

190

212

318

Pension (net of tax)
 
 


Unrealized gain (loss)
3

8

7

13

Amounts reclassified into results of operations
62

35

122

70

Other comprehensive income (loss)
$
(10,420
)
$
12,408

$
(7,209
)
$
5,885

Comprehensive income (loss)
$
4,424

$
25,958

$
17,258

$
32,579

 
 
 
 
 

The components of AOCI consisted of the following for the periods presented:
 
September 30, 2011

March 31, 2011

Foreign currency translation adjustment
$
16,191

$
23,914

Unrealized gains (losses) on derivatives designated and qualified as cash flow hedges
221

(164
)
Unrecognized gain (losses) on defined benefit pension
(4,098
)
(4,227
)
Accumulated other comprehensive income
$
12,314

$
19,523


v2.3.0.11
Segment Reporting
6 Months Ended
Oct. 01, 2011
Segment Reporting [Abstract]  
Segment Reporting
Segment Reporting

Management reviews financial information for the consolidated Company accompanied by disaggregated information on revenues, operating income and assets by geographic region for the purpose of making operational decisions and assessing financial performance. Additionally, Management is presented with and reviews revenues and gross profit by service type. The accounting policies of the individual operating segments are the same as those of the Company.

The following table presents financial information about the Company’s reportable segments by geographic region for the periods presented:
 
Three (3) months ended
Six (6) months ended
 
September 30
September 30
 
2011

2010

2011

2010

North America
 
 
 
 
Revenues
$
251,457

$
240,540

$
484,794

$
471,024

Operating income
18,316

20,684

32,302

39,851

Depreciation
1,253

1,420

2,541

2,890

Intangibles amortization
3,163

3,045

6,212

6,138

Assets (as of September 30)
1,118,907

1,054,646

1,118,907

1,054,646

Europe
 
 
 
 
Revenues
$
26,483

$
22,798

$
52,837

$
47,740

Operating income
2,839

1,153

5,117

3,489

Depreciation
89

93

189

171

Intangibles amortization
11

11

20

19

Assets (as of September 30)
122,723

129,308

122,723

129,308

All Other
 
 
 
 
Revenues
$
9,231

$
9,586

$
17,966

$
17,756

Operating income
1,279

1,691

1,893

3,080

Depreciation
37

39

69

75

Intangibles amortization
2

2

3

3

Assets (as of September 30)
26,911

26,224

26,911

26,224


The sum of the segment revenues, operating income, depreciation and intangibles amortization equals the consolidated revenues, operating income, depreciation and intangibles amortization. The following table reconciles segment assets to total consolidated assets as of September 30, 2011 and 2010:
 
September 30
 
2011

2010

Segment assets for North America, Europe and All Other
$
1,268,541

$
1,210,178

Corporate eliminations
(60,427
)
(52,374
)
Total consolidated assets
$
1,208,114

$
1,157,804


The following table presents financial information about the Company by service type for the periods presented:
 
Three (3) months ended
Six (6) months ended
 
September 30
September 30
 
2011

2010

2011

2010

Data Infrastructure
 
 
 
 
Revenues
$
66,291

$
53,989

$
128,672

$
107,946

Gross profit
15,912

14,076

31,560

28,426

Voice Communications
 
 
 
 
Revenues
$
170,551

$
172,520

$
328,877

$
336,110

Gross profit
50,285

54,647

99,766

108,680

Technology Products
 
 
 
 
Revenues
$
50,329

$
46,415

$
98,048

$
92,464

Gross profit
22,669

21,397

44,121

42,628


The sum of service type revenues and gross profit equals consolidated revenues and gross profit.

v2.3.0.11
Commitments and Contingencies
6 Months Ended
Oct. 01, 2011
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies
Commitments and Contingencies

The Company is involved in, or has pending, various legal proceedings, claims, suits and complaints arising out of the normal course of business. Based on the facts currently available to the Company, Management believes these matters are adequately provided for, covered by insurance, without merit or not probable that an unfavorable outcome will result.

There has been no other significant or unusual activity during Fiscal 2012.