Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 30, 2017 | Jul. 26, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | NUTRACEUTICAL INTERNATIONAL CORP | |
Entity Central Index Key | 1,050,007 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 9,246,999 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2017 | Sep. 30, 2016 | [1] |
Current assets: | |||
Cash | $ 4,183 | $ 6,803 | |
Accounts receivable, net | 20,993 | 17,680 | |
Inventories | 68,558 | 63,923 | |
Prepaid expenses and other current assets | 6,085 | 4,217 | |
Deferred income taxes | 1,250 | 1,243 | |
Total current assets | 101,069 | 93,866 | |
Property, plant and equipment, net | 82,184 | 83,048 | |
Goodwill | 38,582 | 30,925 | |
Intangible assets, net | 28,262 | 22,277 | |
Deferred income taxes | 5,037 | 4,310 | |
Other non-current assets | 1,324 | 1,429 | |
Total assets | 256,458 | 235,855 | |
Current liabilities: | |||
Accounts payable | 16,372 | 12,696 | |
Accrued expenses | 6,599 | 7,469 | |
Total current liabilities | 22,971 | 20,165 | |
Long-term debt | 50,500 | 43,500 | |
Other non-current liabilities | 750 | 200 | |
Total liabilities | 74,221 | 63,865 | |
Stockholders' equity: | |||
Common stock | 93 | 92 | |
Additional paid-in capital | 2,146 | 52 | |
Retained earnings | 180,485 | 172,276 | |
Accumulated other comprehensive loss | (487) | (430) | |
Total stockholders' equity | 182,237 | 171,990 | |
Total liabilities and stockholders' equity | $ 256,458 | $ 235,855 | |
[1] | The condensed consolidated balance sheet as of September 30, 2016 has been prepared using information from the audited financial statements at that date. |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Statement [Abstract] | ||||
Net sales | $ 64,993 | $ 60,836 | $ 182,827 | $ 176,287 |
Cost of sales | 31,600 | 29,416 | 89,419 | 86,430 |
Gross profit | 33,393 | 31,420 | 93,408 | 89,857 |
Operating expenses | ||||
Selling, general and administrative | 25,261 | 21,895 | 69,317 | 64,016 |
Business Acquisition, Transaction Costs | 2,556 | 0 | 2,766 | 0 |
Amortization of intangible assets | 1,357 | 988 | 3,183 | 2,968 |
Income from operations | 4,219 | 8,537 | 18,142 | 22,873 |
Interest and other expense, net | 380 | 326 | 1,022 | 922 |
Income before provision for income taxes | 3,839 | 8,211 | 17,120 | 21,951 |
Provision for income taxes | 1,982 | 2,182 | 6,600 | 7,063 |
Net income | 1,857 | 6,029 | 10,520 | 14,888 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustment, net of tax | 82 | (118) | (57) | (135) |
Comprehensive income | $ 1,939 | $ 5,911 | $ 10,463 | $ 14,753 |
Net income per common share | ||||
Basic (in dollars per share) | $ 0.20 | $ 0.65 | $ 1.14 | $ 1.59 |
Diluted (in dollars per share) | $ 0.20 | $ 0.65 | $ 1.14 | $ 1.59 |
Weighted average common shares outstanding | ||||
Basic (in shares) | 9,246,902 | 9,310,097 | 9,235,063 | 9,390,765 |
Dilutive effect of equity awards (in shares) | 10,648 | 0 | 3,549 | 0 |
Diluted (in shares) | 9,257,550 | 9,310,097 | 9,238,612 | 9,390,765 |
Cash dividend declared per common share (in dollars per share) | $ 0 | $ 0 | $ 0.25 | $ 0 |
CONDENSED CONSOLIDATED STATEME4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | ||
Cash flows from operating activities: | |||
Net income | $ 10,520 | $ 14,888 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 10,905 | 10,599 | |
Amortization of deferred financing fees | 94 | 94 | |
Losses on disposals of property, plant and equipment | 10 | 9 | |
Stock-based compensation | 669 | 0 | |
Bad debt | 45 | 45 | |
Inventory obsolescence | 1,544 | 1,722 | |
Deferred income taxes | (734) | 108 | |
Changes in assets and liabilities, net of effects of acquisitions: | |||
Accounts receivable, net | (3,440) | (2,484) | |
Inventories | (3,759) | (3,405) | |
Prepaid expenses and other current assets | (1,232) | 1,196 | |
Other non-current assets | (58) | (91) | |
Accounts payable | 3,283 | (277) | |
Accrued expenses | (713) | 1,037 | |
Other non-current liabilities | (260) | 18 | |
Net cash provided by operating activities | 16,874 | 23,459 | |
Cash flows from investing activities: | |||
Purchases of property, plant and equipment | (6,475) | (6,394) | |
Acquisitions of businesses | (17,730) | (26,235) | |
Net cash used in investing activities | (24,205) | (32,629) | |
Cash flows from financing activities: | |||
Proceeds from debt | 20,500 | 27,000 | |
Payments on debt | (13,500) | (12,500) | |
Proceeds from issuances of common stock | 56 | 60 | |
Purchases of common stock for treasury | 0 | (6,428) | |
Dividends paid on common stock | (2,311) | 0 | |
Net cash provided by financing activities | 4,745 | 8,132 | |
Effect of exchange rate changes on cash | (34) | (4) | |
Net decrease in cash | (2,620) | (1,042) | |
Cash at beginning of period | 6,803 | [1] | 4,615 |
Cash at end of period | $ 4,183 | $ 3,573 | |
[1] | The condensed consolidated balance sheet as of September 30, 2016 has been prepared using information from the audited financial statements at that date. |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - 9 months ended Jun. 30, 2017 - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | |
Balance (in shares) at Sep. 30, 2016 | 9,203,790 | |||||
Balance at Sep. 30, 2016 | $ 171,990 | [1] | $ 92 | $ 52 | $ 172,276 | $ (430) |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 10,520 | 10,520 | ||||
Foreign currency translation adjustment, net of tax | (57) | (57) | ||||
Other comprehensive loss | (57) | |||||
Issuances of common stock (in shares) | 1,760 | |||||
Issuances of common stock | 56 | |||||
Equity compensation payments (in shares) | 41,449 | |||||
Equity compensation payments | 1,430 | $ 1 | 1,429 | |||
Stock-based compensation | 669 | 669 | ||||
Stock-based compensation expense | 669 | |||||
Other | (60) | (60) | ||||
Dividends paid on common stock | (2,311) | (2,311) | ||||
Balance (in shares) at Jun. 30, 2017 | 9,246,999 | |||||
Balance at Jun. 30, 2017 | $ 182,237 | $ 93 | $ 2,146 | $ 180,485 | $ (487) | |
[1] | The condensed consolidated balance sheet as of September 30, 2016 has been prepared using information from the audited financial statements at that date. |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | BASIS OF PRESENTATION Nutraceutical International Corporation and its subsidiaries (the "Company") is an integrated manufacturer, marketer, distributor and retailer of branded nutritional supplements and other natural products sold primarily to and through domestic health and natural food stores. Internationally, the Company markets and distributes branded nutritional supplements and other natural products to and through health and natural product distributors and retailers. The Company's core business strategy is to acquire, integrate and operate businesses in the natural products industry that manufacture, market and distribute branded nutritional supplements. The Company believes that the consolidation and integration of these acquired businesses provide ongoing financial synergies through increased scale and market penetration, as well as strengthened customer relationships. The Company manufactures and sells nutritional supplements and other natural products under numerous brands, including Solaray ®, KAL ®, Dynamic Health ®, Nature's Life ®, LifeTime ®, Natural Balance ® , NaturalCare ®, Health from the Sun ®, Zhou Nutrition ®, Pioneer ®, Nutra BioGenesis ®, Life-flo ®, Organix South ®, Heritage Store ® and Monarch Nutraceuticals ®. The Company owns neighborhood natural food markets, which operate under the trade names The Real Food Company™ , Thom's Natural Foods™ , Cornucopia Community Market™ and Granola's ®. The Company also owns health food stores, which operate under the trade name Fresh Vitamins ®. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all necessary adjustments, consisting of normal recurring adjustments, to state fairly the consolidated financial position of the Company as of June 30, 2017 , the results of its operations for the three and nine months ended June 30, 2017 and 2016 and its cash flows for the nine months ended June 30, 2017 and 2016 , in conformity with accounting principles generally accepted in the United States of America ("US GAAP") for interim financial information applied on a consistent basis. Results for the three and nine months ended June 30, 2017 are not necessarily indicative of the results to be expected for the full fiscal year. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with US GAAP have been omitted. Accordingly, these financial statements should be read in conjunction with the Company's Form 10-K for the fiscal year ended September 30, 2016 , which was filed with the Securities and Exchange Commission on November 17, 2016. Use of Estimates The preparation of these financial statements in conformity with US GAAP required management to make estimates and assumptions that affected the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of net sales and expenses during the reported periods. Significant estimates included values and lives assigned to acquired intangible assets, reserves for customer returns and allowances, uncollectible accounts receivable, valuation adjustments for slow-moving, obsolete and/or damaged inventory, valuation and recoverability of long-lived assets and valuation of performance-based equity awards. Actual results may differ from these estimates. New Accounting Standards In January 2017, the Financial Accounting Standards Board ("FASB") issued authoritative guidance, which is included in Accounting Standards Codification ("ASC") 805, " Business Combinations. " This guidance clarifies the definition of a business, which assists a company with evaluating whether a transaction should be accounted for as an acquisition (or disposal) of an asset or a business. This guidance is effective for the Company as of October 1, 2018. The Company is currently evaluating the impact this standard may have on its consolidated financial statements. In January 2017, the FASB issued authoritative guidance, which is included in ASC 350, " Intangibles--Goodwill and Other ." This guidance simplifies the test for goodwill impairment by eliminating Step 2 from the test. This guidance is effective for the Company as of October 1, 2020. The Company is currently evaluating the impact this standard may have on its consolidated financial statements. In March 2016, the FASB issued authoritative guidance, which is included in ASC 718, " Compensation--Stock Compensation ." This guidance simplifies the accounting for share-based payments, including the income tax consequences. This guidance is effective for the Company as of October 1, 2017. The Company is currently evaluating the impact this standard may have on its consolidated financial statements. In February 2016, the FASB issued authoritative guidance, which is included in ASC 842, " Leases ." This guidance requires lessees to recognize most leases on the balance sheet by recording a right-of-use asset and a lease liability. This guidance is effective for the Company as of October 1, 2019. The Company is currently evaluating the impact this standard may have on its consolidated financial statements. In November 2015, the FASB issued authoritative guidance, which is included in ASC 740, " Income Taxes ." This guidance simplifies the presentation of deferred income taxes and requires that deferred tax assets and liabilities be classified as noncurrent in the classified statement of financial position. This guidance is effective for the Company as of October 1, 2017 and is not expected to have a material impact on its consolidated financial statements as the guidance only changes the classification of deferred income taxes. In July 2015, the FASB issued authoritative guidance, which is included in ASC 330, " Inventory ." This guidance simplifies the accounting for measuring inventory at the lower of cost and net realizable value and is effective for the Company as of October 1, 2017. The Company does not expect this guidance to have a material impact on its consolidated financial statements. In May 2014, the FASB issued authoritative guidance, which is included in ASC 606, " Revenue from Contracts with Customers ." This guidance provides a single, comprehensive revenue recognition model for all contracts with customers and requires that a company recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In July 2015, the FASB delayed the effective date of this guidance by one year. As a result, this guidance is effective for the Company as of October 1, 2018 and shall be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. The Company is currently evaluating the impact this standard may have on its consolidated financial statements. The Company periodically reviews new accounting standards that are issued. Although some of these accounting standards may be applicable to the Company, the Company has not identified any other new standards that it believes merit further discussion, and the Company expects that none would have a significant impact on its consolidated financial statements. |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 9 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
Accounts Receivable | ACCOUNTS RECEIVABLE Accounts receivable, net of allowances for sales returns and doubtful accounts, consisted of the following: June 30, September 30, Accounts receivable $ 22,040 $ 18,732 Less allowances (1,047 ) (1,052 ) $ 20,993 $ 17,680 |
INVENTORIES
INVENTORIES | 9 Months Ended |
Jun. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | INVENTORIES Inventories were comprised of the following: June 30, September 30, Raw materials $ 30,501 $ 25,792 Work-in-process 15,200 11,711 Finished goods 22,857 26,420 $ 68,558 $ 63,923 |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
Acquisitions | ACQUISITIONS During the nine months ended June 30, 2017, the Company made one acquisition of a business. On April 6, 2017, the Company acquired certain operating assets associated with the Zhou Nutrition brand from Branson Books, LLC for $19,730 , of which $17,730 was paid in cash at the closing date with the remaining $2,000 to be paid in cash over a two -year period from the closing date. During the nine months ended June 30, 2016 , the Company made two acquisitions of businesses. On October 6, 2015, the Company acquired certain operating assets of Dynamic Health Laboratories, Inc. ("Dynamic Health"). On February 18, 2016, the Company acquired certain operating assets of Aubrey Organics, Inc. ("Aubrey Organics"). The aggregate purchase price of these acquisitions was $26,235 in cash. These acquisitions are in keeping with the Company's business strategy of consolidating the fragmented industry in which it competes. These acquisitions were accounted for using the acquisition method of accounting. Accordingly, the purchase price was assigned to the assets acquired based on their fair values at their respective dates of acquisition. The excess of purchase price over the fair values of the assets acquired was classified as goodwill. The goodwill relates to expected synergies from these acquisitions. The following reflects the preliminary allocation of the purchase price for the fiscal 2017 acquisition and the final allocation of the aggregate purchase prices for the fiscal 2016 acquisitions to the assets acquired: Fiscal 2017 Acquisition Fiscal 2016 Acquisitions Aggregate assets acquired: Current assets $ 2,973 $ 4,576 Property, plant and equipment — 6,648 Goodwill 7,657 6,541 Intangible assets 9,100 8,470 $ 19,730 $ 26,235 The fiscal 2017 and fiscal 2016 acquired intangible assets totaling $9,100 and $8,470 , respectively, related to trademarks, tradenames, customer relationships and a non-compete agreement and are being amortized over periods of four to fifteen years for financial statement purposes. The fiscal 2017 and fiscal 2016 acquired intangible assets are expected to be deductible for tax purposes over fifteen years. Goodwill of $7,657 for fiscal 2017 and $6,541 for fiscal 2016 is not subject to amortization for financial statement purposes and is expected to be deductible for tax purposes over fifteen years. The Condensed Consolidated Statements of Comprehensive Income and the Condensed Consolidated Statements of Cash Flows presented herein include the activities of these acquired businesses from their respective dates of acquisition. The expected long-term sales and expense synergies of acquired businesses generally are not realized immediately following acquisition, as certain transition and integration matters must be completed. Since the date of acquisition (April 6, 2017), net sales of $7,306 and gross profit of $4,297 for Zhou Nutrition were included in the Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended June 30, 2017. The Company tracks selling, general and administrative expenses on a consolidated basis, not on a brand-by-brand basis. As a result, the disclosure of any results after gross profit is impracticable. The following table provides unaudited pro forma information for the three and nine months ended June 30, 2017 and 2016, as if the acquisition of Zhou Nutrition had been completed on October 1, 2015. The information has been provided for illustrative purposes only and is not necessarily indicative of the actual results that would have been achieved by the Company for the periods presented or that will be achieved in the future. The pro forma information has been adjusted to give effect to items directly attributable to the Zhou Nutrition acquisition. These adjustments include cost of goods sold associated with the write up of inventory to fair value, commission expense associated with growth incentives, amortization expense associated with acquired intangible assets, interest expense associated with borrowings on the Company's revolving credit facility to fund the acquisition and any consequential tax effects. Three Months Ended Nine Months Ended 2017 2016 2017 2016 Net sales $ 65,420 $ 62,673 $ 194,169 $ 180,985 Net income 2,733 4,850 12,143 13,561 This information has not been adjusted to reflect any changes in the operations of the business subsequent to acquisition. Changes in the operations of the acquired business may include, but are not limited to, discontinuation of certain products, integration of systems and personnel, changes in manufacturing processes and potential cost synergies. Due to these changes, future results could be materially different than the pro forma information provided. Pro forma information was not provided for Dynamic Health for the three and nine months ended June 30, 2016 since the acquisition was completed near the beginning of these periods and the pro forma results are not materially different than actual results. Pro forma information related to the Aubrey Organics acquisition was not material. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 9 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | GOODWILL AND INTANGIBLE ASSETS The change in the carrying amount of goodwill from September 30, 2016 to June 30, 2017 was as follows: Goodwill Accumulated Impairment Net Balance as of September 30, 2016 $ 71,319 $ (40,394 ) $ 30,925 Goodwill attributable to fiscal 2017 acquisition 7,657 — 7,657 Balance as of June 30, 2017 $ 78,976 $ (40,394 ) $ 38,582 The carrying amounts of intangible assets at June 30, 2017 and September 30, 2016 were as follows: June 30, 2017 September 30, 2016 Weighted- Average Amortization Period (Years) Gross Carrying Amount (1) Accumulated Amortization (1) Net Carrying Amount Gross Carrying Amount (1) Accumulated Amortization (1) Net Carrying Amount Intangible assets subject to amortization: Trademarks/tradenames $ 15,590 $ (4,134 ) $ 11,456 $ 13,904 $ (3,137 ) $ 10,767 10 Customer relationships/non-compete agreements/licenses 31,118 (14,312 ) 16,806 23,867 (12,357 ) 11,510 7 Developed software and technology 772 (772 ) — 772 (772 ) — 5 $ 47,480 $ (19,218 ) $ 28,262 $ 38,543 $ (16,266 ) $ 22,277 ______________________ (1) Amounts include the impact of foreign currency translation adjustments. Estimated future amortization expense related to the June 30, 2017 net carrying amount of $28,262 for intangible assets subject to amortization is as follows: Year Ending September 30, Estimated Amortization Expense 2017(1) $ 1,346 2018 5,268 2019 4,840 2020 4,752 2021 4,265 Thereafter 7,791 $ 28,262 _________________________ (1) Estimated amortization expense for the year ending September 30, 2017 includes only amortization to be recorded after June 30, 2017 . General and economic conditions may impact retail and consumer demand, as well as the market price of the Company's common stock, and could negatively impact the Company's future operating performance, cash flow and/or stock price and could result in goodwill and/or intangible asset impairment charges being recorded in future periods. Also, the Company periodically reviews its brands to achieve marketing, sales and operational synergies. These reviews could result in brands being consolidated or discontinued and could result in intangible asset impairment charges being recorded in future periods. Goodwill and/or intangible asset impairment charges could materially impact the Company's consolidated financial statements. The valuation of goodwill and intangible assets is subject to a high degree of judgment, uncertainty and complexity. |
DEBT
DEBT | 9 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Debt | DEBT Debt was comprised of the following: June 30, September 30, Long-term debt—revolving credit facility $ 50,500 $ 43,500 The carrying value of the Company's debt approximates fair value at June 30, 2017 and September 30, 2016 . Estimated fair values for debt have been determined based on borrowing rates currently available to the Company for bank loans with similar terms and maturities and are classified as Level 2 (significant observable inputs other than quoted prices) in the FASB's fair value hierarchy. On November 4, 2014, the Company amended its revolving credit facility (the "Credit Agreement"). The Credit Agreement extends the term of the credit facility to November 2019, increases the available credit borrowings to $100,000 with no automatic reductions and provides an accordion feature that can increase the available credit borrowings to $130,000 , subject to approval by the lenders and compliance with certain covenants and conditions. The lenders under the Credit Agreement continue to be Rabobank International and Wells Fargo. To date, the Company has not experienced any difficulties in accessing the available funds under the Credit Agreement. Deferred financing fees of $420 related to the Credit Agreement are being amortized over the term of the Credit Agreement. At June 30, 2017 , the Company had outstanding revolving credit borrowings of $50,500 under the Credit Agreement. Borrowings under the Credit Agreement are collateralized by substantially all assets of the Company. At the Company's election, borrowings bear interest at the applicable Eurodollar Rate plus a variable margin or at a Base Rate plus a variable margin. Base Rate is the higher of: (i) the Prime Lending Rate , (ii) the Federal Funds Rate plus 0.5% or (iii) the one-month Eurodollar Rate multiplied by the Statutory Reserve Rate plus 1.0% (capitalized terms are defined in the Credit Agreement, a copy of which was filed with the Securities and Exchange Commission on November 5, 2014). At June 30, 2017 , the applicable weighted-average interest rate for outstanding borrowings was 2.42% . The Company is also required to pay a variable quarterly fee on the unused balance under the Credit Agreement. At June 30, 2017 , the applicable rate was 0.25% . Accrued interest on Eurodollar Rate borrowings is payable based on elected intervals of one , two or three months. Accrued interest on Base Rate borrowings is payable quarterly. The Credit Agreement matures on November 4, 2019, and the Company is required to repay all principal and interest outstanding under the Credit Agreement on such date. The Credit Agreement contains restrictive covenants, including limitations on incurring other indebtedness and requirements that the Company maintain certain financial ratios. As of June 30, 2017 , the Company was in compliance with the restrictive covenants. Upon the occurrence of a default, the lender has various remedies or rights, which may include proceeding against the collateral or requiring the Company to repay all amounts outstanding under the Credit Agreement. |
SHARE PURCHASES
SHARE PURCHASES | 9 Months Ended |
Jun. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
Share Purchases | SHARE PURCHASES During the three and nine months ended June 30, 2017, the Company did not purchase or retire any shares of common stock. During the three and nine months ended June 30, 2016 , the Company purchased 119,521 and 265,461 shares of common stock for an aggregate price of $2,862 and $6,428 , respectively. All of these shares of common stock held in treasury were retired prior to June 30, 2016 except for 6,211 shares, which were subsequently retired in September 2016. As of June 30, 2017 , the Company was permitted to purchase up to 1,171,170 additional shares under its approved purchase plan, with no expiration date or restrictions. The Company accounts for treasury shares using the cost method. DIVIDENDS On December 1, 2016, the Company's Board of Directors declared a quarterly cash dividend of $0.13 per share on all shares of common stock. This quarterly cash dividend totaled $1,155 and was paid on January 5, 2017 to stockholders of record on December 20, 2016. On March 3, 2017, the Company's Board of Directors declared a quarterly cash dividend of $0.13 per share on all shares of common stock. This quarterly cash dividend totaled $1,156 and was paid on April 5, 2017 to stockholders of record on March 20, 2017. |
EQUITY AWARDS
EQUITY AWARDS | 9 Months Ended |
Jun. 30, 2017 | |
Equity [Abstract] | |
Equity Awards | EQUITY AWARDS On January 28, 2013, stockholders approved the Nutraceutical International Corporation 2013 Long-Term Equity Incentive Plan (the "2013 Plan") and the reservation of 800,000 shares of the Company's common stock for issuance under the 2013 Plan. Equity awards available under the 2013 Plan include stock awards, performance-based awards, stock options and stock appreciation rights. In conjunction with the Company's fiscal 2016 and fiscal 2015 incentive compensation (bonus) payments, 41,449 and 22,664 shares of the Company's common stock were issued, respectively. These non-cash stock awards were granted on December 14, 2016 and December 11, 2015 at an aggregate fair value of $1,430 and $556 , respectively, with fair value being determined by the closing price of the Company's common stock on the grant date. These stock awards were registered, unrestricted and fully vested on the grant date. On December 14, 2016, the Company’s Compensation Committee approved the grant of performance-based stock units (“PSUs”) to certain executives of the Company under the 2013 Plan. The PSUs are a new element of the Company’s executive compensation program. Generally, the PSUs vest at the end of a three -year performance period ending on September 30, 2019. Vesting is based on the achievement of two pre-set financial criteria during the performance period. The first criteria is the three -year moving average growth in net sales and the second criteria is the three -year average Adjusted EBITDA margin (prior to incentive compensation). Each of these criteria receives consideration in determining the actual number of PSUs that ultimately vest. The initial target number of PSUs is 100,000 . The actual number of PSUs that are ultimately eligible to vest can range from 0% to 210% of the initial target depending on results during the performance period. Each PSU that vests after the performance period will be exchanged for one share of common stock. The Company recognizes stock-based compensation expense for the probable number of PSUs estimated to vest at the end of the performance period. The fair value of each PSU is $34.50 , with fair value being determined by the closing price of the Company’s common stock on the grant date. For the three and nine months ended June 30, 2017, compensation expense related to these PSUs of $309 and $669 , respectively, was included in selling, general and administrative expenses. As of June 30, 2017 , 579,272 shares of the Company's common stock were available for issuance under the 2013 Plan, assuming that the target number of 100,000 PSUs ultimately vest. For the three months ended June 30, 2017, no PSUs were excluded from the computation of diluted earnings per share. For the nine months ended June 30, 2017, PSUs totaling 29,675 were excluded from the computation of diluted earnings per share because the PSUs were anti-dilutive. |
DIVIDEND
DIVIDEND | 9 Months Ended |
Jun. 30, 2017 | |
Dividends [Abstract] | |
Dividend | SHARE PURCHASES During the three and nine months ended June 30, 2017, the Company did not purchase or retire any shares of common stock. During the three and nine months ended June 30, 2016 , the Company purchased 119,521 and 265,461 shares of common stock for an aggregate price of $2,862 and $6,428 , respectively. All of these shares of common stock held in treasury were retired prior to June 30, 2016 except for 6,211 shares, which were subsequently retired in September 2016. As of June 30, 2017 , the Company was permitted to purchase up to 1,171,170 additional shares under its approved purchase plan, with no expiration date or restrictions. The Company accounts for treasury shares using the cost method. DIVIDENDS On December 1, 2016, the Company's Board of Directors declared a quarterly cash dividend of $0.13 per share on all shares of common stock. This quarterly cash dividend totaled $1,155 and was paid on January 5, 2017 to stockholders of record on December 20, 2016. On March 3, 2017, the Company's Board of Directors declared a quarterly cash dividend of $0.13 per share on all shares of common stock. This quarterly cash dividend totaled $1,156 and was paid on April 5, 2017 to stockholders of record on March 20, 2017. |
SEGMENTS
SEGMENTS | 9 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Segments | SEGMENTS Segment identification and selection is consistent with the management structure used by the Company's chief operating decision maker to evaluate performance and make decisions regarding resource allocation, as well as the materiality of financial results consistent with that structure. Based on the Company's management structure and method of internal reporting, the Company has one operating segment. The Company's chief operating decision maker does not review operating results on a disaggregated basis; rather, the chief operating decision maker reviews operating results on a consolidated basis. Net sales attributed to customers in the United States and foreign countries for the three and nine months ended June 30, 2017 and 2016 were as follows: Three Months Ended Nine Months Ended 2017 2016 2017 2016 United States $ 56,590 $ 51,454 $ 158,648 $ 153,854 Foreign countries 8,403 9,382 24,179 22,433 $ 64,993 $ 60,836 $ 182,827 $ 176,287 Certain net sales attributed to customers in the United States are sold to customers who in turn may sell such products to customers in foreign countries, while certain net sales attributed to customers in foreign countries are sold to customers who in turn may sell such products to customers in the United States. The Company's net sales by product group for the three and nine months ended June 30, 2017 and 2016 were as follows: Three Months Ended Nine Months Ended 2017 2016 2017 2016 Branded nutritional supplements and other natural products $ 60,146 $ 55,342 $ 167,774 $ 159,520 Other (1) 4,847 5,494 15,053 16,767 $ 64,993 $ 60,836 $ 182,827 $ 176,287 ____________________ (1) Net sales for any other product or group of similar products are less than 10% of consolidated net sales. |
MERGER AGREEMENT
MERGER AGREEMENT | 9 Months Ended |
Jun. 30, 2017 | |
Merger [Abstract] | |
MERGER AGREEMENT | MERGER AGREEMENT On May 21, 2017, the Company, Nutrition Parent, LLC ("Parent") and Nutrition Sub, Inc. ("Merger Sub"), affiliates of HGGC, LLC (“HGGC”), a leading middle-market private equity firm, entered into a definitive agreement under which the Company will be acquired by affiliates of HGGC in a transaction valued at approximately $446 million , including debt to be refinanced. Under the terms of the agreement, Company stockholders will receive $41.80 in cash (without interest) for each outstanding share of Company common stock they own. The transaction is expected to close in the second half of 2017. Transaction costs related to the merger agreement of $2,556 , or $0.28 per diluted share, and $2,766 , or $0.30 per diluted share, were included in the Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended June 30, 2017, respectively. These transaction costs generally are not deductible for tax purposes, which resulted in higher effective tax rates of 51.6% and 38.6% for the three and nine months ended June 30, 2017, respectively. On July 21, 2017, a putative class action complaint challenging the merger was filed on behalf of Nutraceutical stockholders in the U.S. District Court for the District of Utah. The case is captioned Robert Berg v. Nutraceutical International Corporation, et al. , Case No. 2:17-cv-00830-DS (D. Utah 2017). The complaint asserts claims under Section 14(a) of the Exchange Act, and Rule 14a-9 promulgated thereunder, as well as claims under Section 20(a) of the Exchange Act against the Company, the members of its Board, HGGC, Parent and Merger Sub. The plaintiff alleges that Amendment No. 1 to the Company's preliminary proxy statement filed on July 12, 2017 omitted certain information with respect to the merger and seeks to enjoin the merger, rescission or an award of rescissory damages in the event the merger is consummated, and an award of the plaintiff's attorneys' fees and costs of the litigation. The defendants deny all of the allegations made by the plaintiff and believe the disclosures in the proxy statement and all amendments are adequate under the law, and intend to defend vigorously against all claims asserted. |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 9 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all necessary adjustments, consisting of normal recurring adjustments, to state fairly the consolidated financial position of the Company as of June 30, 2017 , the results of its operations for the three and nine months ended June 30, 2017 and 2016 and its cash flows for the nine months ended June 30, 2017 and 2016 , in conformity with accounting principles generally accepted in the United States of America ("US GAAP") for interim financial information applied on a consistent basis. Results for the three and nine months ended June 30, 2017 are not necessarily indicative of the results to be expected for the full fiscal year. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with US GAAP have been omitted. Accordingly, these financial statements should be read in conjunction with the Company's Form 10-K for the fiscal year ended September 30, 2016 , which was filed with the Securities and Exchange Commission on November 17, 2016. |
Use of Estimates | Use of Estimates The preparation of these financial statements in conformity with US GAAP required management to make estimates and assumptions that affected the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of net sales and expenses during the reported periods. Significant estimates included values and lives assigned to acquired intangible assets, reserves for customer returns and allowances, uncollectible accounts receivable, valuation adjustments for slow-moving, obsolete and/or damaged inventory, valuation and recoverability of long-lived assets and valuation of performance-based equity awards. Actual results may differ from these estimates. |
New Accounting Standards | New Accounting Standards In January 2017, the Financial Accounting Standards Board ("FASB") issued authoritative guidance, which is included in Accounting Standards Codification ("ASC") 805, " Business Combinations. " This guidance clarifies the definition of a business, which assists a company with evaluating whether a transaction should be accounted for as an acquisition (or disposal) of an asset or a business. This guidance is effective for the Company as of October 1, 2018. The Company is currently evaluating the impact this standard may have on its consolidated financial statements. In January 2017, the FASB issued authoritative guidance, which is included in ASC 350, " Intangibles--Goodwill and Other ." This guidance simplifies the test for goodwill impairment by eliminating Step 2 from the test. This guidance is effective for the Company as of October 1, 2020. The Company is currently evaluating the impact this standard may have on its consolidated financial statements. In March 2016, the FASB issued authoritative guidance, which is included in ASC 718, " Compensation--Stock Compensation ." This guidance simplifies the accounting for share-based payments, including the income tax consequences. This guidance is effective for the Company as of October 1, 2017. The Company is currently evaluating the impact this standard may have on its consolidated financial statements. In February 2016, the FASB issued authoritative guidance, which is included in ASC 842, " Leases ." This guidance requires lessees to recognize most leases on the balance sheet by recording a right-of-use asset and a lease liability. This guidance is effective for the Company as of October 1, 2019. The Company is currently evaluating the impact this standard may have on its consolidated financial statements. In November 2015, the FASB issued authoritative guidance, which is included in ASC 740, " Income Taxes ." This guidance simplifies the presentation of deferred income taxes and requires that deferred tax assets and liabilities be classified as noncurrent in the classified statement of financial position. This guidance is effective for the Company as of October 1, 2017 and is not expected to have a material impact on its consolidated financial statements as the guidance only changes the classification of deferred income taxes. In July 2015, the FASB issued authoritative guidance, which is included in ASC 330, " Inventory ." This guidance simplifies the accounting for measuring inventory at the lower of cost and net realizable value and is effective for the Company as of October 1, 2017. The Company does not expect this guidance to have a material impact on its consolidated financial statements. In May 2014, the FASB issued authoritative guidance, which is included in ASC 606, " Revenue from Contracts with Customers ." This guidance provides a single, comprehensive revenue recognition model for all contracts with customers and requires that a company recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In July 2015, the FASB delayed the effective date of this guidance by one year. As a result, this guidance is effective for the Company as of October 1, 2018 and shall be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. The Company is currently evaluating the impact this standard may have on its consolidated financial statements. The Company periodically reviews new accounting standards that are issued. Although some of these accounting standards may be applicable to the Company, the Company has not identified any other new standards that it believes merit further discussion, and the Company expects that none would have a significant impact on its consolidated financial statements. |
ACCOUNTS RECEIVABLE (Tables)
ACCOUNTS RECEIVABLE (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
Schedule of accounts receivable, net of allowances for sales returns and doubtful accounts | Accounts receivable, net of allowances for sales returns and doubtful accounts, consisted of the following: June 30, September 30, Accounts receivable $ 22,040 $ 18,732 Less allowances (1,047 ) (1,052 ) $ 20,993 $ 17,680 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | Inventories were comprised of the following: June 30, September 30, Raw materials $ 30,501 $ 25,792 Work-in-process 15,200 11,711 Finished goods 22,857 26,420 $ 68,558 $ 63,923 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
Schedule of purchase price allocation | The following reflects the preliminary allocation of the purchase price for the fiscal 2017 acquisition and the final allocation of the aggregate purchase prices for the fiscal 2016 acquisitions to the assets acquired: Fiscal 2017 Acquisition Fiscal 2016 Acquisitions Aggregate assets acquired: Current assets $ 2,973 $ 4,576 Property, plant and equipment — 6,648 Goodwill 7,657 6,541 Intangible assets 9,100 8,470 $ 19,730 $ 26,235 |
Business Acquisition, Pro Forma Information | Three Months Ended Nine Months Ended 2017 2016 2017 2016 Net sales $ 65,420 $ 62,673 $ 194,169 $ 180,985 Net income 2,733 4,850 12,143 13,561 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Goodwill [Line Items] | |
Schedule of Goodwill [Table Text Block] | The change in the carrying amount of goodwill from September 30, 2016 to June 30, 2017 was as follows: Goodwill Accumulated Impairment Net Balance as of September 30, 2016 $ 71,319 $ (40,394 ) $ 30,925 Goodwill attributable to fiscal 2017 acquisition 7,657 — 7,657 Balance as of June 30, 2017 $ 78,976 $ (40,394 ) $ 38,582 |
Schedule of carrying amounts of intangible assets | The carrying amounts of intangible assets at June 30, 2017 and September 30, 2016 were as follows: June 30, 2017 September 30, 2016 Weighted- Average Amortization Period (Years) Gross Carrying Amount (1) Accumulated Amortization (1) Net Carrying Amount Gross Carrying Amount (1) Accumulated Amortization (1) Net Carrying Amount Intangible assets subject to amortization: Trademarks/tradenames $ 15,590 $ (4,134 ) $ 11,456 $ 13,904 $ (3,137 ) $ 10,767 10 Customer relationships/non-compete agreements/licenses 31,118 (14,312 ) 16,806 23,867 (12,357 ) 11,510 7 Developed software and technology 772 (772 ) — 772 (772 ) — 5 $ 47,480 $ (19,218 ) $ 28,262 $ 38,543 $ (16,266 ) $ 22,277 ______________________ (1) Amounts include the impact of foreign currency translation adjustments. |
Schedule of estimated amortization expense related to intangible assets subject to amortization | Estimated future amortization expense related to the June 30, 2017 net carrying amount of $28,262 for intangible assets subject to amortization is as follows: Year Ending September 30, Estimated Amortization Expense 2017(1) $ 1,346 2018 5,268 2019 4,840 2020 4,752 2021 4,265 Thereafter 7,791 $ 28,262 _________________________ (1) Estimated amortization expense for the year ending September 30, 2017 includes only amortization to be recorded after June 30, 2017 . |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of debt | Debt was comprised of the following: June 30, September 30, Long-term debt—revolving credit facility $ 50,500 $ 43,500 |
SEGMENTS (Tables)
SEGMENTS (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of net sales attributed to customers in the United States and foreign countries | Net sales attributed to customers in the United States and foreign countries for the three and nine months ended June 30, 2017 and 2016 were as follows: Three Months Ended Nine Months Ended 2017 2016 2017 2016 United States $ 56,590 $ 51,454 $ 158,648 $ 153,854 Foreign countries 8,403 9,382 24,179 22,433 $ 64,993 $ 60,836 $ 182,827 $ 176,287 |
Schedule of net sales by product group | The Company's net sales by product group for the three and nine months ended June 30, 2017 and 2016 were as follows: Three Months Ended Nine Months Ended 2017 2016 2017 2016 Branded nutritional supplements and other natural products $ 60,146 $ 55,342 $ 167,774 $ 159,520 Other (1) 4,847 5,494 15,053 16,767 $ 64,993 $ 60,836 $ 182,827 $ 176,287 ____________________ (1) Net sales for any other product or group of similar products are less than 10% of consolidated net sales. |
ACCOUNTS RECEIVABLE (Details)
ACCOUNTS RECEIVABLE (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Sep. 30, 2016 | |
Receivables [Abstract] | |||
Accounts receivable | $ 22,040 | $ 18,732 | |
Less allowances | (1,047) | (1,052) | |
Accounts receivable, net | $ 20,993 | $ 17,680 | [1] |
[1] | The condensed consolidated balance sheet as of September 30, 2016 has been prepared using information from the audited financial statements at that date. |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Sep. 30, 2016 | |
Inventory Disclosure [Abstract] | |||
Raw materials | $ 30,501 | $ 25,792 | |
Work-in-process | 15,200 | 11,711 | |
Finished goods | 22,857 | 26,420 | |
Inventories | $ 68,558 | $ 63,923 | [1] |
[1] | The condensed consolidated balance sheet as of September 30, 2016 has been prepared using information from the audited financial statements at that date. |
ACQUISITIONS (Details)
ACQUISITIONS (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Jun. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)acquisition | Jun. 30, 2016USD ($)acquisition | Sep. 30, 2016USD ($) | ||
ACQUISITIONS | |||||||
Number of business acquisitions | acquisition | 1 | 2 | |||||
Deferred payments to acquire businesses | $ 2,000 | $ 2,000 | $ 2,000 | ||||
Deferred payments, period | 2 years | ||||||
Aggregate assets acquired: | |||||||
Goodwill | 38,582 | 38,582 | $ 38,582 | $ 30,925 | [1] | ||
2017 Acquisition | |||||||
ACQUISITIONS | |||||||
Aggregate purchase price in cash | 17,730 | ||||||
Aggregate assets acquired: | |||||||
Current assets | 2,973 | 2,973 | 2,973 | ||||
Property, plant and equipment | 0 | 0 | 0 | ||||
Goodwill | 7,657 | 7,657 | 7,657 | ||||
Intangible assets | 9,100 | 9,100 | 9,100 | ||||
Aggregate purchase price | 19,730 | 19,730 | 19,730 | ||||
Acquisitions | |||||||
ACQUISITIONS | |||||||
Aggregate purchase price in cash | 26,235 | ||||||
Aggregate assets acquired: | |||||||
Current assets | 4,576 | ||||||
Property, plant and equipment | 6,648 | ||||||
Goodwill | 6,541 | ||||||
Intangible assets | 8,470 | ||||||
Aggregate purchase price | $ 26,235 | ||||||
Expected period for deduction of acquired intangible assets for tax purposes | 15 years | ||||||
Business acquisition goodwill amount | 7,657 | 7,657 | 7,657 | $ 6,541 | |||
Expected period for deduction of acquired goodwill for tax purposes (years) | 15 years | ||||||
Zhou Nutrition | |||||||
Aggregate assets acquired: | |||||||
Net sales | 65,420 | $ 62,673 | 194,169 | $ 180,985 | |||
Net income | $ 2,733 | $ 4,850 | $ 12,143 | $ 13,561 | |||
Revenue of acquiree since acquisition date | 7,306 | ||||||
Gross profit of acquiree since acquisition date | $ 4,297 | ||||||
Minimum | Acquisitions | |||||||
Aggregate assets acquired: | |||||||
Amortization period | 4 years | ||||||
Maximum | Acquisitions | |||||||
Aggregate assets acquired: | |||||||
Amortization period | 15 years | ||||||
[1] | The condensed consolidated balance sheet as of September 30, 2016 has been prepared using information from the audited financial statements at that date. |
GOODWILL AND INTANGIBLE ASSET27
GOODWILL AND INTANGIBLE ASSETS (Schedule of Goodwill) (Details) $ in Thousands | 9 Months Ended | |
Jun. 30, 2017USD ($) | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 71,319 | |
Accumulated Impairment, beginning balance | (40,394) | |
Goodwill, net | 30,925 | [1] |
Goodwill attributable to fiscal 2017 acquisitions | 7,657 | |
Goodwill, ending balance | 78,976 | |
Accumulated Impairment, ending balance | (40,394) | |
Goodwill, net | $ 38,582 | |
[1] | The condensed consolidated balance sheet as of September 30, 2016 has been prepared using information from the audited financial statements at that date. |
GOODWILL AND INTANGIBLE ASSET28
GOODWILL AND INTANGIBLE ASSETS (Carrying Amounts of Intangible Assets) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2017 | Sep. 30, 2016 | |
Intangible assets subject to amortization: | ||
Gross Carrying Amount | $ 47,480 | $ 38,543 |
Accumulated Amortization | (19,218) | (16,266) |
Net Carrying Amount | 28,262 | 22,277 |
Trademarks/tradenames | ||
Intangible assets subject to amortization: | ||
Gross Carrying Amount | 15,590 | 13,904 |
Accumulated Amortization | (4,134) | (3,137) |
Net Carrying Amount | $ 11,456 | 10,767 |
Weighted- Average Amortization Period (Years) | 10 years | |
Customer relationships/non-compete agreements/licenses | ||
Intangible assets subject to amortization: | ||
Gross Carrying Amount | $ 31,118 | 23,867 |
Accumulated Amortization | (14,312) | (12,357) |
Net Carrying Amount | $ 16,806 | 11,510 |
Weighted- Average Amortization Period (Years) | 7 years | |
Developed software and technology | ||
Intangible assets subject to amortization: | ||
Gross Carrying Amount | $ 772 | 772 |
Accumulated Amortization | (772) | (772) |
Net Carrying Amount | $ 0 | $ 0 |
Weighted- Average Amortization Period (Years) | 5 years |
GOODWILL AND INTANGIBLE ASSET29
GOODWILL AND INTANGIBLE ASSETS (Schedule of Estimated Future Amortization Expense) (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Sep. 30, 2016 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2,017 | $ 1,346 | |
2,018 | 5,268 | |
2,019 | 4,840 | |
2,020 | 4,752 | |
2,021 | 4,265 | |
Thereafter | 7,791 | |
Net Carrying Amount | $ 28,262 | $ 22,277 |
DEBT (Details)
DEBT (Details) - USD ($) | 9 Months Ended | |||
Jun. 30, 2017 | Sep. 30, 2016 | [1] | Nov. 04, 2014 | |
Debt Instruments [Line Items] | ||||
Long-term debt—revolving credit facility | $ 50,500,000 | $ 43,500,000 | ||
Statutory Reserve Rate | ||||
Debt Instruments [Line Items] | ||||
Reference rate | one-month Eurodollar Rate | |||
Margin over reference rate | 1.00% | |||
Restated Credit Agreement | ||||
Debt Instruments [Line Items] | ||||
Available credit borrowings | $ 100,000,000 | |||
Deferred financing cost | 420,000 | |||
Outstanding revolving credit borrowings | $ 50,500,000 | |||
Weighted-average interest rate | 2.42% | |||
Quarterly fee on the unused balance | 0.25% | |||
Restated Credit Agreement | Eurodollar Rate | ||||
Debt Instruments [Line Items] | ||||
Reference rate | Eurodollar Rate | |||
Interval for payment of accrued interest under option one | 1 month | |||
Interval for payment of accrued interest under option two | 2 months | |||
Interval for payment of accrued interest under option three | 3 months | |||
Restated Credit Agreement | Prime Lending Rate | ||||
Debt Instruments [Line Items] | ||||
Reference rate | Prime Lending Rate | |||
Restated Credit Agreement | Federal Funds Rate | ||||
Debt Instruments [Line Items] | ||||
Reference rate | Federal Funds Rate | |||
Margin over reference rate | 0.50% | |||
Credit Agreement, accordion feature | ||||
Debt Instruments [Line Items] | ||||
Available credit borrowings | $ 130,000,000 | |||
[1] | The condensed consolidated balance sheet as of September 30, 2016 has been prepared using information from the audited financial statements at that date. |
SHARE PURCHASES (Details)
SHARE PURCHASES (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2016 | Jun. 30, 2017 | Mar. 31, 2016 | |
Share purchases | ||||
Remaining number of shares authorized for repurchase | 6,211 | |||
Additional number of shares authorized to be repurchased (in shares) | 1,171,170 | |||
Common Stock | ||||
Share purchases | ||||
Shares of common stock purchased (in shares) | 119,521 | 265,461 | ||
Aggregate price at which shares of common stock purchased | $ 2,862 | $ 6,428 |
EQUITY AWARDS (Details)
EQUITY AWARDS (Details) $ / shares in Units, $ in Thousands | Dec. 14, 2016USD ($)criteriashares | Dec. 11, 2015USD ($) | Jun. 30, 2017USD ($)$ / sharesshares | Jun. 30, 2017USD ($)$ / sharesshares | Sep. 30, 2016shares | Sep. 30, 2015shares | Jan. 28, 2013shares |
2013 Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares of common stock reserved for issuance (in shares) | 800,000 | ||||||
Equity compensation payments (in shares) | 41,449 | 22,664 | |||||
Equity compensation payments | $ | $ 1,430 | $ 556 | |||||
Shares of common stock available for issuance (in shares) | 579,272 | 579,272 | |||||
PSUs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 3 years | ||||||
Number of criteria for PSUs | criteria | 2 | ||||||
Moving average growth in net sales period | 3 years | ||||||
Average adjusted EBITDA margin period | 3 years | ||||||
Target number of shares (in units) | 100,000 | ||||||
Number of common shares issued for PSUs vested after performance period | 1 | ||||||
Fair value at grant date (dollars per share) | $ / shares | $ 34.50 | $ 34.50 | |||||
Anti-dilutive stock options (in shares) | 0 | 29,675 | |||||
Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Eligible vesting range | 0.00% | ||||||
Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Eligible vesting range | 210.00% | ||||||
Selling, General and Administrative Expenses | PSUs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Compensation expense | $ | $ 309 | $ 669 |
DIVIDEND (Details)
DIVIDEND (Details) - USD ($) $ / shares in Units, $ in Thousands | Apr. 05, 2017 | Mar. 03, 2017 | Jan. 05, 2017 | Dec. 01, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 |
Dividends Payable [Line Items] | ||||||||
Dividends declared (dollars per share) | $ 0 | $ 0 | $ 0.25 | $ 0 | ||||
Dividends paid in cash | $ 2,311 | $ 0 | ||||||
Dividend Declared | ||||||||
Dividends Payable [Line Items] | ||||||||
Dividends declared (dollars per share) | $ 0.13 | $ 0.13 | ||||||
Dividend Paid | ||||||||
Dividends Payable [Line Items] | ||||||||
Dividends paid in cash | $ 1,156 | $ 1,155 |
SEGMENTS (Details)
SEGMENTS (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)segment | Jun. 30, 2016USD ($) | |
Segment Reporting [Abstract] | ||||
Number of operating segments | segment | 1 | |||
SEGMENTS | ||||
Net sales | $ 64,993 | $ 60,836 | $ 182,827 | $ 176,287 |
Branded nutritional supplements and other natural products | ||||
SEGMENTS | ||||
Net sales | 60,146 | 55,342 | 167,774 | 159,520 |
Other | ||||
SEGMENTS | ||||
Net sales | 4,847 | 5,494 | 15,053 | 16,767 |
United States | ||||
SEGMENTS | ||||
Net sales | 56,590 | 51,454 | 158,648 | 153,854 |
Foreign countries | ||||
SEGMENTS | ||||
Net sales | $ 8,403 | $ 9,382 | $ 24,179 | $ 22,433 |
MERGER AGREEMENT (Details)
MERGER AGREEMENT (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2017 | May 21, 2017 | |
Merger [Abstract] | |||
Merger transaction value | $ 446,000 | ||
Sale of stock (USD per share) | $ 41.80 | ||
Merger related costs | $ 2,556 | $ 2,766 | |
Merger cost (USD per share) | $ 0.28 | $ 0.30 | |
Effective Income Tax Rate Reconciliation, Percent | 51.60% | 38.60% |