|Distribution||$ 1,067,839||$ 1,012,059||$ 930,131|
|Total||$ 1,681,806||$ 1,592,828||$ 1,477,534|
|$ change||$ 88,978||$ 115,294||$ 177,602|
|% change||5.6 %||7.8 %||13.7 %|
The following table details the components of the above changes as a percentage of consolidated net sales:
|Distribution||(1.1 )%||(0.1 )%||4.8 %|
|Aerospace||2.1 %||0.8 %||2.2 %|
|Total Organic Sales||1.0 %||0.7 %||7.0 %|
|Distribution||4.6 %||5.7 %||4.2 %|
|Aerospace||— %||1.4 %||2.5 %|
|Total Acquisition Sales||4.6 %||7.1 %||6.7 %|
|% change in net sales||5.6 %||7.8 %||13.7 %|
The increase in net sales from continuing operations for 2013 as compared to 2012 was attributable to an increase in organic sales at our Aerospace segment and the contribution of $72.6 million in sales from our Distribution segment acquisitions completed in 2013 and 2012, partially offset by lower organic sales at our Distribution segment. Foreign currency exchange rates had a $1.1 million favorable impact on sales from continuing operations during 2013.
The increase in net sales from continuing operations for 2012 as compared to 2011 was attributable to an increase in organic sales at our Aerospace segment and the contribution of $106.5 million in sales from the acquisitions completed in 2012 and 2011, partially offset by lower organic sales at our Distribution segment. Foreign currency exchange rates had a $4.2 million unfavorable impact on sales from continuing operations during 2012.
See Segment Results of Operations and Financial Condition below for further discussion of segment net sales.
|Gross profit||$ 466,624||$ 441,973||$ 412,572|
|% change||5.6 %||7.1 %||16.8 %|
|% of net sales||27.7 %||27.7 %||27.9 %|
Gross profit from continuing operations increased in 2013 primarily due to the increase in sales and profit for both military and commercial products/programs at our Aerospace segment and the contribution of $21.8 million of gross profit from our 2012 and 2013 acquisitions. Contributing to the Aerospace segment's improved gross profit were the incremental profit associated with higher sales of our bearing products and the gross profit associated with the initial recognition of revenue on the SH-2G(I) contract with New Zealand. These increases of $16.1 million, which were in addition to the acquisition related gross profit noted above, were partially offset by the decline in organic gross profit at the Distribution segment of approximately $14.2 million. The decline in the Distribution segment's organic gross profit was primarily due to decreases in the food and beverage manufacturing markets.
Gross profit from continuing operations increased in 2012 primarily due to the contribution of $22.3 million of gross profit from our 2012 acquisitions. The Distribution segment's organic gross profit slightly improved, despite the lower organic sales. This was primarily due to increases in primary metal and fabricated metal manufacturing, nonmetallic mineral manufacturing and merchant wholesalers and durable goods, offset by declines in the food and beverage manufacturing industries, and the mining industry. The Aerospace segment had a slight decrease in organic gross profit due to the absence of commercial sales of the JPF to foreign militaries, lower shipments under our Sikorsky BLACK HAWK helicopter cockpit program due to lower customer requirements, a lower volume of work on our unmanned K-MAX® aircraft system, lower sales volume for our legacy fuze programs and $3.3 million in net loss resulting from the resolution of a program related matter. These decreases of approximately $22.2 million were largely offset by higher sales of our bearing products and an increased volume of sales of the JPF to the USG.
|S,G&A||$ 363,945||$ 349,030||$ 324,722|
|% change||4.3 %||7.5 %||12.4 %|
|% of net sales||21.6 %||21.9 %||22.0 %|
S,G&A increased for the year-ended December 31, 2013, as compared to 2012. The following table details the components of this change:
|Distribution||(0.7 )%||0.8 %||2.6 %|
|Aerospace||0.4 %||(3.0 )%||4.5 %|
|Corporate||(0.4 )%||2.6 %||(0.1 )%|
|Total Organic S,G&A||(0.7 )%||0.4 %||7.0 %|
|Distribution||5.0 %||5.8 %||3.6 %|
|Aerospace||— %||1.3 %||1.8 %|
|Corporate||— %||— %||— %|
|Total Acquisition S,G&A||5.0 %||7.1 %||5.4 %|
|% change in S,G&A||4.3 %||7.5 %||12.4 %|
S,G&A expenses from continuing operations increased for 2013 as compared to 2012 primarily due to $17.3 million of expenses related to our 2013 and 2012 acquisitions and an increase in expenses at our Aerospace segment. The increase in expense at our Aerospace segment was primarily due to higher research and development costs of approximately $2.0 million. These increases were slightly offset by lower expense for the Distribution segment's organic business due to $3.2 million of savings realized from the restructuring completed in the first quarter of 2013. Corporate expenses remained relatively flat from 2012 to 2013. This was a result of lower expenses related to our defined benefit pension plan, offset by an increase in insurance costs and building renovation expenses.
S,G&A expenses from continuing operations increased for 2012 as compared to 2011 due to $23.3 million of expenses related to our 2012 and 2011 acquisitions, an increase in organic expense at our Distribution segment and higher corporate expenses. The increase in expense at our Distribution segment was attributable to an increase in employee related costs including group health insurance, and an increase in expense associated with the implementation of the new ERP system. Corporate expense increased $7.3 million for 2012 as compared to 2011, with increases in our incentive compensation expense due to an increase in the number of participants, higher acquisition related costs, and the absence of the nonrecurring benefit of $2.4 million associated with the death of a former executive received in 2011. Partially offsetting these increases was an organic decrease in expense at our Aerospace segment. The lower expense at our Aerospace segment was primarily due to the absence of a $4.75 million expense associated with the settlement of the FMU-143 matter in 2011.
|Goodwill impairment||$ 2,071||$ —||$ —|
During 2012, the Company's VT Composites reporting unit experienced delays on certain programs that were driven by changes in customers' requirements. The Company anticipated these changes in requirements would shift revenues and related cash flows into 2013 and future periods. The anticipated revenues did not materialize to the levels we had projected in 2013, and therefore the results of Step 1 of the impairment analysis resulted in a fair value for the reporting unit below its carrying value. Prior to proceeding to Step 2 of the impairment analysis, management assessed the tangible and intangible assets subject to amortization to determine if they were impaired and concluded they were not. Upon completion of the Step 2 impairment analysis, we recorded a non-cash non-tax deductible goodwill impairment charge of $2.1 million, or 11% of the reporting unit's total goodwill balance, to reduce the carrying value of goodwill to its implied fair value. This charge has been included in the operating results of the Company's Aerospace segment.