Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Nov. 30, 2020 | Jan. 04, 2021 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Amendment Flag | false | |
Document Period End Date | Nov. 30, 2020 | |
Entity File Number | 000-06936 | |
Entity Registrant Name | WD-40 COMPANY | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 95-1797918 | |
Entity Address, Address Line One | 9715 Businesspark Avenue | |
Entity Address, City or Town | San Diego | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92131 | |
City Area Code | 619 | |
Local Phone Number | 275-1400 | |
Title of 12(b) Security | Common stock, par value $0.001 per share | |
Trading Symbol | WDFC | |
Security Exchange Name | NASDAQ | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0000105132 | |
Current Fiscal Year End Date | --08-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 13,688,203 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 65,844 | $ 56,462 |
Trade accounts receivable, less allowance for doubtful accounts of $490 and $362 at November 30, 2020 and August 31, 2020, respectively | 91,061 | 80,672 |
Inventories | 41,772 | 41,264 |
Other current assets | 8,098 | 6,756 |
Total current assets | 206,775 | 185,154 |
Property and equipment, net | 62,607 | 60,759 |
Goodwill | 95,721 | 95,731 |
Other intangible assets, net | 8,268 | 8,633 |
Operating lease right-of-use assets | 8,815 | 8,168 |
Deferred tax assets, net | 472 | 464 |
Other assets | 3,740 | 3,728 |
Total assets | 386,398 | 362,637 |
Current liabilities: | ||
Accounts payable | 24,749 | 21,676 |
Accrued liabilities | 22,989 | 21,660 |
Accrued payroll and related expenses | 15,426 | 14,767 |
Short-term borrowings | 800 | 800 |
Income taxes payable | 2,890 | 1,213 |
Total current liabilities | 66,854 | 60,116 |
Long-term borrowings | 114,712 | 113,098 |
Deferred tax liabilities, net | 11,557 | 11,291 |
Long-term operating lease liabilities | 7,141 | 6,520 |
Other long-term liabilities | 11,634 | 11,299 |
Total liabilities | 211,898 | 202,324 |
Commitments and Contingencies (Note 12) | ||
Shareholders' equity: | ||
Common stock - authorized 36,000,000 shares, $0.001 par value; 19,836,102 and 19,812,685 shares issued at November 30, 2020 and August 31, 2020, respectively; and 13,688,203 and 13,664,786 shares outstanding at November 30, 2020 and August 31, 2020, respectively | 20 | 20 |
Additional paid-in capital | 157,025 | 157,850 |
Retained earnings | 413,155 | 398,731 |
Accumulated other comprehensive loss | (27,620) | (28,208) |
Common stock held in treasury, at cost - 6,147,899 and 6,147,899 shares at November 30, 2020 and August 31, 2020, respectively | (368,080) | (368,080) |
Total shareholders' equity | 174,500 | 160,313 |
Total liabilities and shareholders' equity | $ 386,398 | $ 362,637 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Condensed Consolidated Balance Sheets [Abstract] | ||
Trade accounts receivable, less allowance for doubtful accounts | $ 490 | $ 362 |
Common stock, shares authorized | 36,000,000 | 36,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares issued | 19,836,102 | 19,812,685 |
Common stock, shares outstanding | 13,688,203 | 13,664,786 |
Treasury stock, shares | 6,147,899 | 6,147,899 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Condensed Consolidated Statements Of Operations [Abstract] | ||
Net sales | $ 124,559 | $ 98,556 |
Cost of products sold | 54,313 | 45,013 |
Gross profit | 70,246 | 53,543 |
Operating expenses: | ||
Selling, general and administrative | 35,977 | 32,599 |
Advertising and sales promotion | 5,519 | 5,590 |
Amortization of definite-lived intangible assets | 358 | 650 |
Total operating expenses | 41,854 | 38,839 |
Income from operations | 28,392 | 14,704 |
Other income (expense): | ||
Interest income | 19 | 25 |
Interest expense | (570) | (442) |
Other income (expense), net | 179 | 5 |
Income before income taxes | 28,020 | 14,292 |
Provision for income taxes | 4,397 | 2,098 |
Net income | $ 23,623 | $ 12,194 |
Earnings per common share: | ||
Basic | $ 1.72 | $ 0.88 |
Diluted | $ 1.72 | $ 0.88 |
Shares used in per share calculations: | ||
Basic | 13,675 | 13,714 |
Diluted | 13,706 | 13,746 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Condensed Consolidated Statements Of Comprehensive Income [Abstract] | ||
Net income | $ 23,623 | $ 12,194 |
Other comprehensive income (loss): | ||
Foreign currency translation adjustment | 588 | 2,112 |
Total comprehensive income | $ 24,211 | $ 14,306 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Treasury Stock [Member] | Total |
Beginning balance at Aug. 31, 2019 | $ 20 | $ 155,132 | $ 374,060 | $ (32,482) | $ (351,255) | $ 145,475 |
Beginning balance, shares at Aug. 31, 2019 | 19,773,977 | 6,055,316 | ||||
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes | (2,640) | (2,640) | ||||
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes, shares | 22,342 | |||||
Stock-based compensation | 2,214 | 2,214 | ||||
Cash dividends | (8,406) | (8,406) | ||||
Acquisition of treasury stock | $ (4,957) | (4,957) | ||||
Acquisition of treasury stock, shares | 26,800 | |||||
Foreign currency translation adjustment | 2,112 | 2,112 | ||||
Net income | 12,194 | 12,194 | ||||
Ending balance at Nov. 30, 2019 | $ 20 | 154,706 | 377,848 | (30,370) | $ (356,212) | 145,992 |
Ending balance, shares at Nov. 30, 2019 | 19,796,319 | 6,082,116 | ||||
Beginning balance at Aug. 31, 2020 | $ 20 | 157,850 | 398,731 | (28,208) | $ (368,080) | $ 160,313 |
Beginning balance, shares at Aug. 31, 2020 | 19,812,685 | 6,147,899 | 13,664,786 | |||
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes | (3,490) | $ (3,490) | ||||
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes, shares | 23,417 | |||||
Stock-based compensation | 2,665 | 2,665 | ||||
Cash dividends | (9,199) | (9,199) | ||||
Foreign currency translation adjustment | 588 | 588 | ||||
Net income | 23,623 | 23,623 | ||||
Ending balance at Nov. 30, 2020 | $ 20 | $ 157,025 | $ 413,155 | $ (27,620) | $ (368,080) | $ 174,500 |
Ending balance, shares at Nov. 30, 2020 | 19,836,102 | 6,147,899 | 13,688,203 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Condensed Consolidated Statements Of Shareholders' Equity [Abstract] | ||
Cash dividends, per share | $ 0.67 | $ 0.61 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Operating activities: | ||
Net income | $ 23,623 | $ 12,194 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 1,700 | 1,957 |
Net gains on sales and disposals of property and equipment | (55) | (64) |
Deferred income taxes | 236 | 57 |
Stock-based compensation | 2,665 | 2,214 |
Unrealized foreign currency exchange losses | 52 | 394 |
Provision for bad debts | 124 | 6 |
Changes in assets and liabilities: | ||
Trade accounts receivable | (9,936) | 3,630 |
Inventories | (345) | (2,358) |
Other assets | (1,304) | 462 |
Operating lease assets and liabilities, net | 6 | 195 |
Accounts payable and accrued liabilities | 4,590 | (332) |
Accrued payroll and related expenses | 624 | (2,234) |
Other long-term liabilities and income taxes payable | 1,941 | (915) |
Net cash provided by operating activities | 23,921 | 15,206 |
Investing activities: | ||
Purchases of property and equipment | (3,812) | (5,965) |
Proceeds from sales of property and equipment | 142 | 195 |
Net cash used in investing activities | (3,670) | (5,770) |
Financing activities: | ||
Treasury stock purchases | (4,957) | |
Dividends paid | (9,199) | (8,406) |
Proceeds from issuance of long-term senior notes | 52,000 | |
Repayments of long-term senior notes | (400) | (400) |
Net (repayments) proceeds of revolving credit facility | (50,000) | 7,883 |
Shares withheld to cover taxes upon conversions of equity awards | (3,490) | (2,640) |
Net cash used in financing activities | (11,089) | (8,520) |
Effect of exchange rate changes on cash and cash equivalents | 220 | 531 |
Net increase in cash and cash equivalents | 9,382 | 1,447 |
Cash and cash equivalents at beginning of period | 56,462 | 27,233 |
Cash and cash equivalents at end of period | 65,844 | 28,680 |
Supplemental disclosure of noncash investing activities: | ||
Accrued capital expenditures | $ 1,274 | $ 1,206 |
The Company
The Company | 3 Months Ended |
Nov. 30, 2020 | |
The Company [Abstract] | |
The Company | Note 1. The Company WD-40 Company (“the Company”), based in San Diego, California, is a global marketing organization dedicated to creating positive lasting memories by developing and selling products that solve problems in workshops, factories and homes around the world. The Company markets a wide range of maintenance products and homecare and cleaning products under the following well-known brands: WD-40®, 3-IN-ONE®, GT85®, X-14®, 2000 Flushes®, Carpet Fresh®, no vac®, Spot Shot®, 1001®, Lava® and Solvol®. Currently included in the WD-40 brand are the WD-40 Multi-Use Product and the WD-40 Specialist® and WD-40 BIKE® product lines . The Company’s products are sold in various locations around the world. Maintenance products are sold worldwide in markets throughout North, Central and South America, Asia, Australia, Europe, the Middle East and Africa. Homecare and cleaning products are sold primarily in North America, the United Kingdom (“U.K.”) and Australia. The Company’s products are sold primarily through warehouse club stores, hardware stores, automotive parts outlets, industrial distributors and suppliers, mass retail and home center stores, value retailers, grocery stores, online retailers, farm supply, sport retailers, and independent bike dealers |
Basis Of Presentation And Summa
Basis Of Presentation And Summary Of Significant Accounting Policies | 3 Months Ended |
Nov. 30, 2020 | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract] | |
Basis Of Presentation And Summary Of Significant Accounting Policies | Note 2. Basis of Presentation and Summary of Significant Accounting Policies Basis of Consolidation The condensed consolidated financial statements included herein have been prepared by the Company, without audit, according to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. The August 31, 2020 year-end condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by U.S. GAAP. In the opinion of management, the unaudited financial information for the interim periods shown reflects all adjustments necessary for a fair statement thereof and such adjustments are of a normal recurring nature. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended August 31 , 2020, which was filed with the SEC on October 21, 2020. The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Operating results for interim periods are not necessarily indicative of operating results for an entire fiscal year. COVID-19 Considerations The COVID-19 pandemic has adversely impacted global economic conditions and has contributed to significant volatility in financial markets beginning in early calendar year 2020, as described in the “ Significant Developments ” section included in Part I – Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. Although the Company’s current estimates contemplate current conditions, the inputs into certain of the Company’s significant and critical accounting estimates include judgments and assumptions about the economic implications of the COVID-19 pandemic and how management expects them to change in the future, as appropriate. It is reasonably possible that actual results experienced may differ materially from the Company’s estimates in future periods, which could materially affect our results of operations and financial condition. Foreign Currency Forward Contracts In the normal course of business, the Company employs established policies and procedures to manage its exposure to fluctuations in foreign currency exchange rates. The Company utilizes foreign currency forward contracts to limit its exposure to net asset balances held in non-functional currencies, primarily at its U.K. subsidiary. The Company regularly monitors its foreign currency exchange rate exposures to ensure the overall effectiveness of its foreign currency hedge positions. While the Company engages in foreign currency hedging activity to reduce its risk, for accounting purposes, none of its foreign currency forward contracts are designated as hedges . Foreign currency forward contracts are carried at fair value, with net realized and unrealized gains and losses recognized currently in other income (expense) in the Company’s consolidated statements of operations. Cash flows from settlements of foreign currency forward contracts are included in operating activities in the consolidated statements of cash flows. Foreign currency forward contracts in an asset position at the end of the reporting period are included in other current assets, while foreign currency forward contracts in a liability position at the end of the reporting period are included in accrued liabilities in the Company’s consolidated balance sheets . At November 30, 2020, the Company had a notional amount of $ 13.7 million outstanding in foreign currency forward contracts, which will mature on January 28, 2021 . Unrealized net gains and losses related to foreign currency forward contracts were no t significant at November 30, 2020 and August 31, 2020 . Realized net gains and losses related to foreign currency forward contracts were no t significant for both the three months ended November 30, 2020 and 2019. Realized net gains and losses related to foreign currency forward contracts were no t significant for both the three months ended November 30, 2020 and 2019. Both unrealized and realized net gains and losses are recorded in other income (expense), net on the Company’s condensed consolidated statements of operations. Fair Value of Financial Instruments Accounting Standards Codification (“ASC”) 820, “ Fair Value Measurements and Disclosures” , defines fair value as the exchange price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company categorizes its financial assets and liabilities measured at fair value into a hierarchy that categorizes fair value measurements into the following three levels based on the types of inputs used in measuring their fair value: Level 1: Observable inputs such as quoted market prices in active markets for identical assets or liabilities; Level 2: Observable market-based inputs or observable inputs that are corroborated by market data; and Level 3: Unobservable inputs reflecting the Company’s own assumptions. Under fair value accounting, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. As of November 30, 2020, the Company had no assets or liabilities that are measured at fair value in the financial statements on a recurring basis, with the exception of the foreign currency forward contracts, which are classified as Level 2 within the fair value hierarchy. The carrying values of cash equivalents and short-term borrowings are recorded at cost, which approximates their fair values, primarily due to their short-term nature. In addition, the carrying value of borrowings held under the Company’s revolving credit facility approximates fair value, based on Level 2 inputs, due to the variable nature of underlying interest rates, which generally reflect market conditions. The Company’s fixed rate long-term borrowings consist of senior notes and are recorded at carrying value. The Company estimates that the fair value of its senior notes, based on Level 2 inputs, was approximately $ 70.2 million as of November 30, 2020, which was determined based on a discounted cash flow analysis using current market interest rates for instruments with similar terms, compared to their carrying value of $ 69.6 million . During the three months ended November 30, 2020, the Company did no t record any significant nonrecurring fair value measurements for assets or liabilities in periods subsequent to their initial recognition Recently Issued Accounting Standards In December 2019, the FASB issued ASU No. 2019-12, “ Simplifying the Accounting for Income Taxes ” under ASC 740, which simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application. This guidance is effective for fiscal years beginning after December 15, 2021, including interim periods within that fiscal year. Early adoption is permitted. The Company is in the process of evaluating the impacts of this guidance on its consolidated financial statements and related disclosures . |
Inventories
Inventories | 3 Months Ended |
Nov. 30, 2020 | |
Inventories [Abstract] | |
Inventories | Note 3. Inventories Inventories consist primarily of raw materials and components, finished goods, and product held at third-party contract manufacturers. Inventories are stated at the lower of cost or market and cost is determined based on a first-in, first-out method or, for a portion of raw materials inventory, the average cost method. Inventories consisted of the following (in thousands): November 30, August 31, 2020 2020 Product held at third-party contract manufacturers $ 5,824 $ 4,393 Raw materials and components 5,044 5,034 Work-in-process 449 385 Finished goods 30,455 31,452 Total $ 41,772 $ 41,264 |
Property And Equipment
Property And Equipment | 3 Months Ended |
Nov. 30, 2020 | |
Property And Equipment [Abstract] | |
Property And Equipment | Note 4. Property and Equipment Property and equipment, net, consisted of the following (in thousands): November 30, August 31, 2020 2020 Machinery, equipment and vehicles $ 20,452 $ 20,434 Buildings and improvements 28,334 28,271 Computer and office equipment 5,529 5,420 Software 10,101 9,959 Furniture and fixtures 2,643 2,641 Capital in progress 24,597 21,939 Land 4,371 4,374 Subtotal 96,027 93,038 Less: accumulated depreciation and amortization ( 33,420 ) ( 32,279 ) Total $ 62,607 $ 60,759 |
Goodwill And Other Intangible A
Goodwill And Other Intangible Assets | 3 Months Ended |
Nov. 30, 2020 | |
Goodwill And Other Intangible Assets [Abstract] | |
Goodwill And Other Intangible Assets | Note 5. Goodwill and Other Intangible Assets Goodwill The following table summarizes the changes in the carrying amounts of goodwill by segment (in thousands): Americas EMEA Asia-Pacific Total Balance as of August 31, 2020 $ 85,461 $ 9,060 $ 1,210 $ 95,731 Translation adjustments - ( 9 ) ( 1 ) ( 10 ) Balance as of November 30, 2020 $ 85,461 $ 9,051 $ 1,209 $ 95,721 There were no indicators of impairment identified as a result of the Company’s review of events and circumstances related to its goodwill subsequent to December 1, 2019, the date of its most recent annual goodwill impairment test, which was conducted during the second quarter of fiscal year 2020. Based on the results of the annual goodwill impairment test, the estimated fair value of each of the Company’s reporting units exceeded their respective carrying values so significantly that an impairment charge to the Company’s goodwill balances is remote, even in the event that the impacts of the novel coronavirus (“COVID-19”) pandemic significantly lower results in future periods. To date, there have been no impairment losses identified and recorded related to the Company’s goodwill. Definite-lived Intangible Assets The Company’s definite-lived intangible assets, which include the Spot Shot, Carpet Fresh, 1001, EZ REACH and GT85 trade names, are included in other intangible assets, net in the Company’s condensed consolidated balance sheets. The following table summarizes the definite-lived intangible assets and the related accumulated amortization (in thousands): November 30, August 31, 2020 2020 Gross carrying amount $ 36,340 $ 36,363 Accumulated amortization ( 28,072 ) ( 27,730 ) Net carrying amount $ 8,268 $ 8,633 There has been no impairment charge for the three months ended November 30, 2020 and there were no indicators of impairment identified as a result of the Company’s review of events and circumstances related to its existing definite-lived intangible assets. The Company’s review of events and circumstances included consideration of the ongoing COVID-19 pandemic. Changes in the carrying amounts of definite-lived intangible assets by segment for the three months ended November 30, 2020 are summarized below (in thousands): Americas EMEA Asia-Pacific Total Balance as of August 31, 2020 $ 6,553 $ 2,080 $ - $ 8,633 Amortization expense ( 264 ) ( 94 ) - ( 358 ) Translation adjustments - ( 7 ) - ( 7 ) Balance as of November 30, 2020 $ 6,289 $ 1,979 $ - $ 8,268 The estimated amortization expense for the Company’s definite-lived intangible assets in future fiscal years is as follows (in thousands): Trade Names Customer-Based Remainder of fiscal year 2021 $ 953 $ 128 Fiscal year 2022 1,271 170 Fiscal year 2023 1,024 - Fiscal year 2024 1,019 - Fiscal year 2025 941 - Thereafter 2,762 - Total $ 7,970 $ 298 Included in the total estimated future amortization expense is the amortization expense for the 1001 trade name and the GT85 intangible assets, which are based on current foreign currency exchange rates, and as a result amounts in future periods may differ from those presented due to fluctuations in those rates. |
Leases
Leases | 3 Months Ended |
Nov. 30, 2020 | |
Leases [Abstract] | |
Leases | Note 6. Leases The Company leases real estate for its regional sales offices, a research and development facility, and offices located at its international subsidiaries and branch locations. In addition, the Company leases an automobile fleet in the United States. The Company has also identified warehouse leases within certain third-party distribution center service contracts. All other leases are insignificant to the Company’s consolidated financial statements. To determine if a contract contains a lease, the Company assesses its contracts and determines if there is an identified asset for which the Company has obtained the right to control, as defined in ASC 842. The Company records right-of-use assets and lease liabilities on its consolidated balance sheets for leases with an expected term greater than one year. The lease term includes the committed lease term, also taking into account early termination and renewal options that management is reasonably certain to exercise. For leases that do not have a readily determinable implicit rate, the Company uses its estimated secured incremental borrowing rate based on the information available at the lease commencement date to determine the present value of lease payments. The Company’s estimated secured incremental borrowing rate is determined using a portfolio approach based on the rate of interest the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term. The Company uses the unsecured borrowing rate and risk-adjusts that rate to approximate a collateralized rate in the currency of the lease. As of November 30, 2020, finance leases were not significant and all leases recorded on the Company’s consolidated balances sheets were operating leases. Residual value guarantees, restrictions, covenants, sublease income, net gains or losses from sale and leaseback transactions, and transactions with related parties associated with leases are also not significant. The Company has made the accounting policy election to use certain ongoing practical expedients made available by ASC 842 to: (i) not separate lease components from nonlease components for real estate – office buildings, machinery and equipment, lab equipment, office equipment, furniture and fixtures, and IT equipment; and (ii) exclude leases with an initial term of 12 months or less (“short-term” leases) from the consolidated balance sheets and will recognize related lease payments in the consolidated statements of operations on a straight-line basis over the lease term. However, the Company had no significant short-term leases as of November 30, 2020. The Company obtained additional right-of-use assets of $ 1.0 million in exchange for lease obligations during the three months ended November 30, 2020. The Company recorded $ 0.5 million in lease expense during both the three months ended November 30, 2020 and 2019. This lease expense was included in selling, general and administrative expenses. An insignificant amount of lease expense was classified within cost of products sold for both the three months ended November 30, 2020 and 2019. During both the three months ended November 30, 2020 and 2019, the Company paid cash of $ 0.5 million related to lease liabilities. Variable lease expense under the Company’s lease agreements were no t significant for both the three months ended both November 30, 2020 and 2019. As of November 30, 2020, the weighted-average remaining lease term was 6.5 years and the weighted-average discount rate was 3.0 % for the Company’s operating leases. There were no leases that had not yet commenced as of November 30, 2020 that will create additional significant rights and obligations for the Company. Right-of-use assets and lease liabilities consisted of the following (in thousands): November 30, August 31, 2020 2020 Assets: Operating lease right-of-use assets $ 8,815 $ 8,168 Liabilities: Current operating lease liabilities (1) 1,890 1,840 Long-term operating lease liabilities 7,141 6,520 Total operating lease liabilities $ 9,031 $ 8,360 (1) Current operating lease liabilities are classified in accrued liabilities on the Company’s condensed consolidated balance sheet. The Company’s maturities of its operating lease liabilities, including early termination and renewal options that management is reasonably certain to exercise, are as follows (in thousands): Operating Leases Remainder of fiscal year 2021 $ 1,611 Fiscal year 2022 1,969 Fiscal year 2023 1,622 Fiscal year 2024 1,471 Fiscal year 2025 937 Thereafter 2,464 Total undiscounted future cash flows $ 10,074 Less: Interest ( 1,043 ) Present value of lease liabilities $ 9,031 |
Accrued And Other Liabilities
Accrued And Other Liabilities | 3 Months Ended |
Nov. 30, 2020 | |
Accrued And Other Liabilities [Abstract] | |
Accrued And Other Liabilities | Note 7. Accrued and Other Liabilities Accrued liabilities consisted of the following (in thousands): November 30, August 31, 2020 2020 Accrued advertising and sales promotion expenses $ 10,812 $ 10,787 Accrued professional services fees 2,140 1,761 Accrued sales taxes and other taxes 1,902 1,751 Short-term operating lease liability 1,890 1,840 Other 6,245 5,521 Total $ 22,989 $ 21,660 Accrued payroll and related expenses consisted of the following (in thousands): November 30, August 31, 2020 2020 Accrued incentive compensation $ 4,020 $ 5,702 Accrued payroll 4,447 4,396 Accrued profit sharing 3,655 2,726 Accrued payroll taxes 2,631 1,446 Other 673 497 Total $ 15,426 $ 14,767 |
Debt
Debt | 3 Months Ended |
Nov. 30, 2020 | |
Debt [Abstract] | |
Debt | Note 8. Debt As of November 30, 2020, the Company held borrowings under two separate agreements as detailed below. Note Purchase and Private Shelf Agreement The Company holds borrowings under its Note Purchase and Private Shelf Agreement (the “Note Agreement”) by and among the Company, PGIM, Inc. (“Prudential”), and certain affiliates and managed accounts of Prudential (the “Note Purchasers”). The note agreement has been amended three times, most recently on September 30, 2020 (the “Third Amendment”). The Third Amendment permitted the Company to enter into the first amendment of its existing amended and restated revolving credit agreement with Bank of America and also included certain conforming amendments to the credit agreement, including the revision of financial and restrictive covenants. Credit Agreement The Company’s Amended and Restated Credit Agreement (the “Credit Agreement”) with Bank of America consists of a revolving commitment for borrowing by the Company up to $ 150.0 million with a sublimit of $ 100.0 million for WD-40 Company Limited, a wholly owned operating subsidiary of the Company for Europe, the Middle East, Africa and India. On September 30, 2020, the Company entered into a First Amendment to Credit Agreement (the “First Amendment to Credit Agreement”) with Bank of America. In addition to other non-material and technical amendments to the Credit Agreement, the First Amendment to Credit Agreement extended the maturity date from March 16, 2025 to September 30, 2025 , revised certain financial and restrictive covenants, increased the limitation amounts on other unsecured Indebtedness and Investments and adjusted the interest rates on subsequent borrowings under the Credit Agreement using a three-tier pricing approach tied to the Company’s Consolidated Leverage Ratio. Capitalized terms not otherwise defined in this report have the meaning given to such terms in the Credit Agreement. Short-term and long-term borrowings under the Company’s Credit Agreement and Note Agreement consisted of the following (in thousands): Maturities November 30, August 31, Issuance (calendar year) 2020 2020 Credit Agreement - revolving credit facility (1)(3) Various 9/30/2025 $ 45,912 $ 95,898 Note Agreement Series A Notes - 3.39 % fixed rate (2) 11/15/2017 2021 - 2032 17,600 18,000 Series B Notes - 2.50 % fixed rate (3) 9/30/2020 11/15/2027 26,000 - Series C Notes - 2.69 % fixed rate (3) 9/30/2020 11/15/2030 26,000 - Total borrowings 115,512 113,898 Short-term portion of borrowings ( 800 ) ( 800 ) Total long-term borrowings $ 114,712 $ 113,098 (1) The Company has the ability to refinance any draw under the line of credit with successive short-term borrowings through the maturity date. Outstanding draws for which management has both the ability and intent to refinance with successive short-term borrowings for a period of at least twelve months are classified as long-term. As of November 30, 2020, the entire balance on this facility is classified as long-term and only contains amounts denominated in Euros and Pound Sterling. Euro and Pound Sterling denominated draws will fluctuate in U.S. Dollars from period to period due to changes in foreign currency exchange rates. (2) Principal payments are required semi-annually in May and November of each year in equal installments of $ 0.4 million through May 15, 2032 . The remaining outstanding principal in the amount of $ 8.4 million will become due on November 15, 2032 . (3) On September 30, 2020, the Company refinanced $ 50.0 million of existing draws under its Credit Agreement in the United States through the issuance of two new $ 26.0 million notes (“Series B Notes” and “Series C Notes”, respectively) under its Note Agreement. Interest on these new notes is payable semi-annually in May and November of each year with no principle due until the maturity date. The first interest payment on both the Series B and Series C Notes is due in May 2021 . Both the Note Agreement and the Credit Agreement contain representations, warranties, events of default and remedies, as well as affirmative, negative and other financial covenants customary for these types of agreements. These covenants include, among other things, certain limitations on the ability of the Company and its subsidiaries to incur indebtedness, create liens, dispose of assets, make investments, declare, make or incur obligations to make certain restricted payments, including the payment of dividends and payments for the repurchase of the Company’s capital stock and enter into certain merger or consolidation transactions. The Credit Agreement includes, among other limitations on indebtedness, a $ 125.0 million limit on other unsecured indebtedness. Each agreement also includes a most favored lender provision which requires that any time any other lender has the benefit of one or more financial or operational covenants that is different than, or similar to, but more restrictive than those contained in its own agreement, those covenants shall be immediately and automatically incorporated by reference to the other lender’s agreement. Both the Note Agreement and the Credit Agreement require the Company to adhere to the same financial covenants. For the financial covenants, the definition of consolidated EBITDA includes the add back of non-cash stock-based compensation to consolidated net income when arriving at consolidated EBITDA. The terms of the financial covenants are as follows: The consolidated leverage ratio cannot be greater than three and a half to one. The consolidated leverage ratio means, as of any date of determination, the ratio of (a) consolidated funded indebtedness as of such date to (b) consolidated EBITDA for the most recently completed four fiscal quarters. The consolidated interest coverage ratio cannot be less than three to one. The consolidated interest coverage ratio means, as of any date of determination, the ratio of (a) consolidated EBITDA for the most recently completed four fiscal quarters to (b) consolidated interest charges for the most recently completed four fiscal quarters As of November 30, 2020, the Company was in compliance with all debt covenants under both the Note Agreement and the Credit Agreement. |
Share Repurchase Plan
Share Repurchase Plan | 3 Months Ended |
Nov. 30, 2020 | |
Share Repurchase Plan [Abstract] | |
Share Repurchase Plan | Note 9. Share Repurchase Plan On April 8, 2020, the Company elected to suspend repurchases under its previously approved share buy-back plan, which subsequently expired on August 31, 2020. The Company made this election in order to preserve cash while it continues to monitor the long-term impacts of the COVID-19 pandemic. Management does not expect to seek Board approval for a new share buy-back plan until it starts to see a reduced level of uncertainty regarding the pandemic’s impact on the economy and the Company’s business. Therefore, no repurchase transactions were made during the first quarter of fiscal year 2021. |
Earnings Per Common Share
Earnings Per Common Share | 3 Months Ended |
Nov. 30, 2020 | |
Earnings Per Common Share [Abstract] | |
Earnings Per Common Share | Note 10. Earnings per Common Share The table below reconciles net income to net income available to common shareholders (in thousands): Three Months Ended November 30, 2020 2019 Net income $ 23,623 $ 12,194 Less: Net income allocated to participating securities ( 110 ) ( 67 ) Net income available to common shareholders $ 23,513 $ 12,127 The table below summarizes the weighted-average number of common shares outstanding included in the calculation of basic and diluted EPS (in thousands): Three Months Ended November 30, 2020 2019 Weighted-average common shares outstanding, basic 13,675 13,714 Weighted-average dilutive securities 31 32 Weighted-average common shares outstanding, diluted 13,706 13,746 For the three months ended November 30, 2020, there were no anti-dilutive stock-based equity awards outstanding. For the three months ended November 30, 2019, weighted-average stock-based equity awards outstanding that are non-participating securities in the amount of 5,729 were excluded from the calculation of diluted EPS under the treasury stock method as they were anti-dilutive. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Nov. 30, 2020 | |
Revenue Recognition [Abstract] | |
Revenue Recognition | Note 11. Revenue Recognition The following paragraphs detail the Company’s revenue recognition policies and provide additional information used in its determination of net sales and contract balances under ASC 606. Revenue Recognition The Company generates revenue from sales of its products to customers in its Americas, EMEA and Asia-Pacific segments. Product sales for the Company include maintenance products and homecare and cleaning products. The Company recognizes revenue related to the sale of these products when it satisfies a performance obligation in an amount reflecting the consideration to which it expects to be entitled. Sales are recorded net of allowances for damaged goods and other sales returns, sales incentives, trade promotions and cash discounts. The Company applies a five-step approach in determining the amount and timing of revenue to be recognized which includes the following: (1) identifying the contract with a customer, (2) identifying the performance obligations in the contract, (3) determining the transaction price, (4) allocating the transaction price to the performance obligations in the contract and (5) recognizing revenue when the performance obligation is satisfied. Contracts with customers are renewable periodically and contain terms and conditions with respect to payment, delivery, sales incentives, warranty and supply, but do not require mandatory purchase commitments. In the absence of a specific sales agreement with a customer, the Company’s standard terms and conditions at the time of acceptance of purchase orders apply to the sales transaction. The Company’s standard terms and conditions are either included in a standalone document or on the Company’s price lists or both, and these standard terms and conditions are provided to the customer prior to the sales transaction. The Company considers the customer purchase orders, governed by specific sales agreements or the Company’s standard terms and conditions, to be the contract with the customer. The Company considers each transaction to sell products as separate and distinct, with no additional promises made, and as a result, all of the Company's sales are single performance obligation arrangements for which the transaction price is equivalent to the stated price of the product, net of any variable consideration for items such as sales returns, discounts, rebates and other sales incentives. The Company recognizes sales at a point in time upon transferring control of its product to the customer. This typically occurs when products are shipped or delivered, depending on when risks of loss and title have passed to the customer per the terms of the contract. Taxes imposed by governmental authorities on the Company's revenue, such as sales taxes and value added taxes, are excluded from net sales. Sales commissions are paid to certain third parties based upon specific sales levels achieved during a defined time period. Since the Company’s contracts related to these sales commissions do not exceed one year, the Company has elected as a practical expedient to expense these payments as incurred. The Company also elected the practical expedient related to shipping and handling fees which allows the Company to account for freight costs as fulfillment activities instead of assessing such activities as performance obligations. The Company’s freight costs are sometimes paid by the customer, while other times, the freight costs are included in the sales price. The Company does not account for freight costs as a separate performance obligation, but rather as an activity performed to transfer the products to its customers. Variable Consideration - Sales Incentives In determining the transaction price, the Company evaluates whether the price is subject to refund or adjustment related to variable consideration to determine the net consideration to which the Company expects to be entitled. The Company records estimates of variable consideration, which primarily includes rebates/other discounts (cooperative marketing programs, volume-based discounts, shelf price reductions and allowances for shelf space, charges from customers for services they provided to us related to the sale and penalties/fines charged to us by customers associated with failing to adhere to contractual obligations), coupon offers, cash discount allowances, and sales returns, as a reduction of sales in its consolidated statements of operations. These estimates are based on the expected value method considering all reasonably available information, including current and past trade promotion spending patterns, status of trade promotion activities, the interpretation of historical spending trends by customer and category, customer agreements and/or currently known factors that arise in the normal course of business. The Company reviews its assumptions and adjusts these estimates accordingly on a quarterly basis. Rebates/Other Discounts — The Company offers various on-going trade promotion programs with customers and provides other discounts to customers that require management to estimate and accrue for the expected costs of such programs or discounts. These programs include cooperative marketing, volume-based discounts, shelf price reductions, consideration and allowances given to retailers for shelf space and/or favorable display positions in their stores and other promotional activities. Other discounts include items such as charges from customers for services they provide related to the sale of WD-40 Company products and penalties/fees associated with WD-40 Company failing to adhere to contractual obligations (e.g., errors on purchase orders, errors on shipment, late deliveries, etc.). Costs related to rebates, cooperative advertising and other promotional activities and other discounts are recorded as a reduction to sales upon delivery of the Company ’ s products to its customers. The Company had a $ 7.9 million and $ 7.5 million balance in rebate/other discount liabilities as of November 30 and August 31, 2020, respectively, which are included in accrued liabilities on the Company ’ s condensed consolidated balance sheets. The Company recorded approximately $ 5.3 million and $ 5.0 million in rebates/other discounts as a reduction to sales during the three months ended November 30, 2020 and 2019, respectively. Coupons — Coupon costs are based upon historical redemption rates and are recorded as a reduction to sales as incurred, which is when the coupons are circulated. Coupon redemption liabilities, which are included in accrued liabilities on the Company ’ s condensed consolidated balance sheets, were not significant at November 30, 2020 and August 31, 2020. Coupons recorded as a reduction to sales during the three months ended November 30, 2020 and 2019 were also not significant. Cash discounts — The Company offers certain of its customers a cash discount program to incentivize them to pay the invoice earlier than the normal payment date on the invoice. Although payment terms vary, most customers typically pay within 30 to 90 days of invoicing. The Company had a $ 0.4 million and $ 0.5 million balance in the allowance for cash discounts at November 30, 2020 and August 31, 2020, respectively. The Company recorded approximately $ 1.2 million and $ 1.0 million in cash discounts as a reduction to sales during the three months ended November 30, 2020 and 2019, respectively. Sales returns — The Company recognizes revenue net of allowances for estimated returns, which is based on historical return rates, with a corresponding reduction to cost of products sold. Although the Company typically does not have definitive sales return provisions included in the contract terms with its customers, when such provisions have been included, they have not been significant. The Company presents its provision for sales returns on a gross basis as a liability. The Company ’ s refund liability for sales returns is included in accrued liabilities and represents the amount expected to be owed to the customers for product returns. The Company’s refund liability for sales returns was not significant at both November 30, 2020 and August 31, 2019. The Company also records an asset for the value of inventory that represents the right to recover products from customers associated with sales returns. The value of this inventory is recorded to other current assets and the balance in this account associated with product returns was not significant at November 30, 2020 and August 31, 2020. Disaggregation of Revenue The Company's revenue is presented on a disaggregated basis in Note 14 – Business Segments and Foreign Operations included in this report. The Company discloses certain information about its business segments, which are determined consistent with the way the Company’s Chief Operating Decision Maker organizes and evaluates financial information internally for making operating decisions and assessing performance. The Chief Operating Decision Maker assesses and measures revenue based on geographic area and product groups. Contract Balances Contract liabilities consist of deferred revenue related to undelivered products. Deferred revenue is recorded when payments have been received from customers for undelivered products. Revenue is subsequently recognized when revenue recognition criteria are met, generally when control of the product transfers to the customer. The Company had contract liabilities of $ 2.3 million and $ 1.4 million as of November 30, 2020 and August 31, 2020, respectively. These contract liabilities are recorded in accrued liabilities on the Company ’ s condensed consolidated balance sheets. The Company did no t have any contract assets as of November 30, 2020 and August 31, 2020. |
Commitments And Contingencies
Commitments And Contingencies | 3 Months Ended |
Nov. 30, 2020 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | Note 12. Commitments and Contingencies Purchase Commitments The Company has ongoing relationships with various suppliers (contract manufacturers) that manufacture the Company’s products and third-party distribution centers that warehouse and ship the Company’s products to customers. The contract manufacturers maintain title and control of certain raw materials and components, materials utilized in finished products, and of the finished products themselves until shipment to the Company’s customers or third-party distribution centers in accordance with agreed upon shipment terms. Although the Company has definitive minimum purchase obligations included in the contract terms with certain of its contract manufacturers, when such obligations have been included, they have either been immaterial or the minimum amounts have been such that they are well below the volume of goods that the Company has historically purchased. In the ordinary course of business, supply needs are communicated by the Company to its contract manufacturers based on orders and short-term projections, ranging from two months to six months . The Company is committed to purchase the products produced by the contract manufacturers based on the projections provided . Upon the termination of contracts with contract manufacturers, the Company obtains certain inventory control rights and is obligated to work with the contract manufacturer to sell through all product held by or manufactured by the contract manufacturer on behalf of the Company during the termination notification period. If any inventory remains at the contract manufacturer at the termination date, the Company is obligated to purchase such inventory which may include raw materials, components and finished goods. The amounts for inventory purchased under termination commitments have been immaterial . In addition to the commitments to purchase products from contract manufacturers described above, the Company may also enter into commitments with other manufacturers to purchase finished goods and components to support innovation and renovation initiatives and/or supply chain initiatives. As of November 30, 2020, no such commitments were outstanding. Litigation From time to time, the Company is subject to various claims, law suits, investigations and proceedings arising in the ordinary course of business , including but not limited to, product liability litigation and other claims and proceedings with respect to intellectual property, breach of contract, labor and employment, tax and other matters . As of November 30, 2020, there were no unasserted claims or pending proceedings for claims against the Company that the Company believes will result in a probable loss for the Company and, as to claims that the Company believes may result in a reasonably possible loss, the Company believes that no reasonably possible outcome of any such claim will have a materially adverse impact on the Company’s financial condition , results of operations or cash flows. For further information on the risks the Company faces from existing and future claims, suits, investigations and proceedings, see the Company’s risk factors disclosed in Part I―Item 1A, “Risk Factors,” in its Annual Report on Form 10-K for the fiscal year ended August 31, 2020, which was filed with the SEC on October 21, 2020. Indemnifications As permitted under Delaware law, the Company has agreements whereby it indemnifies senior officers and directors for certain events or occurrences while the officer or director is, or was, serving at the Company’s request in such capacity. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company maintains Director and Officer insurance coverage that mitigates the Company’s exposure with respect to such obligations. As a result of the Company’s insurance coverage, management believes that the estimated fair value of these indemnification agreements is minimal . Thus, no liabilities have been recorded for these agreements as of November 30, 2020 . From time to time, the Company enters into indemnification agreements with certain contractual parties in the ordinary course of business, including agreements with lenders, lessors, contract manufacturers, marketing distributors, customers and certain vendors. All such indemnification agreements are entered into in the context of the particular agreements and are provided in an attempt to properly allocate risk of loss in connection with the consummation of the underlying contractual arrangements. Although the maximum amount of future payments that the Company could be required to make under these indemnification agreements is unlimited, management believes that the Company maintains adequate levels of insurance coverage to protect the Company with respect to most potential claims arising from such agreements and that such agreements do not otherwise have value separate and apart from the liabilities incurred in the ordinary course of the Company’s business. Thus, no liabilities have been recorded with respect to such indemnification agreements as of November 30, 2020 . |
Income Taxes
Income Taxes | 3 Months Ended |
Nov. 30, 2020 | |
Income Taxes [Abstract] | |
Income Taxes | Note 13. Income Taxes The Company uses an estimated annual effective tax rate, which is based on expected annual income, statutory tax rates and tax planning opportunities available in the various jurisdictions in which the Company operates, to determine its quarterly provision for income taxes. Certain significant or unusual items are separately recognized in the quarter in which they occur and can be a source of variability in the effective tax rates from quarter to quarter. The provision for income taxes was 15.7 % and 14.7 % of income before income taxes for the three months ended November 30, 2020 and 2019, respectively. Discrete benefits, primarily those related to excess tax benefits from settlements of stock-based equity awards, reduced the effective income tax rate to a level significantly below the anticipated annual effective tax rate for each period. Although these discrete benefits increased from period to period, they decreased as a percentage of pre-tax income due to significantly higher pre-tax income during the first quarter of fiscal year 2021 which resulted in a higher effective income tax rate from period to period. The Company is subject to taxation in the U.S. and in various state and foreign jurisdictions. The Company is currently under examination by various state taxing authorities. Due to expired statutes, the Company’s federal income tax returns for years prior to fiscal year 2017 are not subject to examination by the U.S. Internal Revenue Service. Generally, for the majority of state and foreign jurisdictions where the Company does business, periods prior to fiscal year 2017 are no longer subject to examination . The Company is currently under audit in various state and foreign jurisdictions for fiscal years 2017 through 2019. Estimated unrecognized tax benefits related to income tax positions may be affected by the resolution of tax examinations or expiring statutes of limitation within the next twelve months were not significant. Audit outcomes and the timing of settlements are subject to significant uncertainty . |
Business Segments And Foreign O
Business Segments And Foreign Operations | 3 Months Ended |
Nov. 30, 2020 | |
Business Segments And Foreign Operations [Abstract] | |
Business Segments And Foreign Operations | Note 14. Business Segments and Foreign Operations The Company evaluates the performance of its segments and allocates resources to them based on sales and operating income. The Company is organized on the basis of geographical area into the following three segments: the Americas; EMEA; and Asia-Pacific. Segment data does not include inter-segment revenues. Unallocated corporate expenses are general corporate overhead expenses not directly attributable to the business segments and are reported separate from the Company’s identified segments. The corporate overhead costs include expenses for the Company’s accounting and finance, information technology, human resources, research and development, quality control and executive management functions, as well as all direct costs associated with public company compliance matters including legal, audit and other professional services costs. Summary information about reportable segments is as follows (in thousands): Unallocated For the Three Months Ended Americas EMEA Asia-Pacific Corporate (1) Total November 30, 2020: Net sales $ 54,188 $ 54,749 $ 15,622 $ - $ 124,559 Income from operations $ 14,626 $ 17,743 $ 5,060 $ ( 9,037 ) $ 28,392 Depreciation and amortization expense $ 791 $ 756 $ 75 $ 78 $ 1,700 Interest income $ 1 $ 1 $ 17 $ - $ 19 Interest expense $ 455 $ 114 $ 1 $ - $ 570 November 30, 2019: Net sales $ 46,736 $ 39,245 $ 12,575 $ - $ 98,556 Income from operations $ 10,580 $ 8,592 $ 3,202 $ ( 7,670 ) $ 14,704 Depreciation and amortization expense $ 1,172 $ 634 $ 74 $ 77 $ 1,957 Interest income $ 4 $ 1 $ 20 $ - $ 25 Interest expense $ 342 $ 99 $ 1 $ - $ 442 (1) Unallocated corporate expenses are general corporate overhead expenses not directly attributable to any one of the business segments. These expenses are reported separate from the Company’s identified segments and are included in Selling, General and Administrative expenses on the Company’s condensed consolidated statements of operations. The Company’s Chief Operating Decision Maker does not review assets by segment as part of the financial information provided, and therefore, no asset information is provided in the above table. Net sales by product group are as follows (in thousands): Three Months Ended November 30, 2020 2019 Maintenance products $ 114,343 $ 89,670 Homecare and cleaning products 10,216 8,886 Total $ 124,559 $ 98,556 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Nov. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 15. Subsequent Events On December 7, 2020 , the Company’s Board of Directors declared a cash dividend of $ 0.67 per share payable on January 29, 2021 to shareholders of record on January 15, 2021 . |
Basis Of Presentation And Sum_2
Basis Of Presentation And Summary Of Significant Accounting Policies (Policy) | 3 Months Ended |
Nov. 30, 2020 | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract] | |
Basis Of Consolidation | Basis of Consolidation The condensed consolidated financial statements included herein have been prepared by the Company, without audit, according to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. The August 31, 2020 year-end condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by U.S. GAAP. In the opinion of management, the unaudited financial information for the interim periods shown reflects all adjustments necessary for a fair statement thereof and such adjustments are of a normal recurring nature. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended August 31 , 2020, which was filed with the SEC on October 21, 2020. The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Use Of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Operating results for interim periods are not necessarily indicative of operating results for an entire fiscal year. |
COVID-19 Considerations | COVID-19 Considerations The COVID-19 pandemic has adversely impacted global economic conditions and has contributed to significant volatility in financial markets beginning in early calendar year 2020, as described in the “ Significant Developments ” section included in Part I – Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. Although the Company’s current estimates contemplate current conditions, the inputs into certain of the Company’s significant and critical accounting estimates include judgments and assumptions about the economic implications of the COVID-19 pandemic and how management expects them to change in the future, as appropriate. It is reasonably possible that actual results experienced may differ materially from the Company’s estimates in future periods, which could materially affect our results of operations and financial condition. |
Foreign Currency Forward Contracts | Foreign Currency Forward Contracts In the normal course of business, the Company employs established policies and procedures to manage its exposure to fluctuations in foreign currency exchange rates. The Company utilizes foreign currency forward contracts to limit its exposure to net asset balances held in non-functional currencies, primarily at its U.K. subsidiary. The Company regularly monitors its foreign currency exchange rate exposures to ensure the overall effectiveness of its foreign currency hedge positions. While the Company engages in foreign currency hedging activity to reduce its risk, for accounting purposes, none of its foreign currency forward contracts are designated as hedges . Foreign currency forward contracts are carried at fair value, with net realized and unrealized gains and losses recognized currently in other income (expense) in the Company’s consolidated statements of operations. Cash flows from settlements of foreign currency forward contracts are included in operating activities in the consolidated statements of cash flows. Foreign currency forward contracts in an asset position at the end of the reporting period are included in other current assets, while foreign currency forward contracts in a liability position at the end of the reporting period are included in accrued liabilities in the Company’s consolidated balance sheets . At November 30, 2020, the Company had a notional amount of $ 13.7 million outstanding in foreign currency forward contracts, which will mature on January 28, 2021 . Unrealized net gains and losses related to foreign currency forward contracts were no t significant at November 30, 2020 and August 31, 2020 . Realized net gains and losses related to foreign currency forward contracts were no t significant for both the three months ended November 30, 2020 and 2019. Realized net gains and losses related to foreign currency forward contracts were no t significant for both the three months ended November 30, 2020 and 2019. Both unrealized and realized net gains and losses are recorded in other income (expense), net on the Company’s condensed consolidated statements of operations. |
Fair Value Of Financial Instruments | Fair Value of Financial Instruments Accounting Standards Codification (“ASC”) 820, “ Fair Value Measurements and Disclosures” , defines fair value as the exchange price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company categorizes its financial assets and liabilities measured at fair value into a hierarchy that categorizes fair value measurements into the following three levels based on the types of inputs used in measuring their fair value: Level 1: Observable inputs such as quoted market prices in active markets for identical assets or liabilities; Level 2: Observable market-based inputs or observable inputs that are corroborated by market data; and Level 3: Unobservable inputs reflecting the Company’s own assumptions. Under fair value accounting, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. As of November 30, 2020, the Company had no assets or liabilities that are measured at fair value in the financial statements on a recurring basis, with the exception of the foreign currency forward contracts, which are classified as Level 2 within the fair value hierarchy. The carrying values of cash equivalents and short-term borrowings are recorded at cost, which approximates their fair values, primarily due to their short-term nature. In addition, the carrying value of borrowings held under the Company’s revolving credit facility approximates fair value, based on Level 2 inputs, due to the variable nature of underlying interest rates, which generally reflect market conditions. The Company’s fixed rate long-term borrowings consist of senior notes and are recorded at carrying value. The Company estimates that the fair value of its senior notes, based on Level 2 inputs, was approximately $ 70.2 million as of November 30, 2020, which was determined based on a discounted cash flow analysis using current market interest rates for instruments with similar terms, compared to their carrying value of $ 69.6 million . During the three months ended November 30, 2020, the Company did no t record any significant nonrecurring fair value measurements for assets or liabilities in periods subsequent to their initial recognition |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In December 2019, the FASB issued ASU No. 2019-12, “ Simplifying the Accounting for Income Taxes ” under ASC 740, which simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application. This guidance is effective for fiscal years beginning after December 15, 2021, including interim periods within that fiscal year. Early adoption is permitted. The Company is in the process of evaluating the impacts of this guidance on its consolidated financial statements and related disclosures . |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Inventories [Abstract] | |
Schedule Of Inventories | November 30, August 31, 2020 2020 Product held at third-party contract manufacturers $ 5,824 $ 4,393 Raw materials and components 5,044 5,034 Work-in-process 449 385 Finished goods 30,455 31,452 Total $ 41,772 $ 41,264 |
Property And Equipment (Tables)
Property And Equipment (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Property And Equipment [Abstract] | |
Schedule Of Property And Equipment, Net | November 30, August 31, 2020 2020 Machinery, equipment and vehicles $ 20,452 $ 20,434 Buildings and improvements 28,334 28,271 Computer and office equipment 5,529 5,420 Software 10,101 9,959 Furniture and fixtures 2,643 2,641 Capital in progress 24,597 21,939 Land 4,371 4,374 Subtotal 96,027 93,038 Less: accumulated depreciation and amortization ( 33,420 ) ( 32,279 ) Total $ 62,607 $ 60,759 |
Goodwill And Other Intangible_2
Goodwill And Other Intangible Assets (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Goodwill And Other Intangible Assets [Abstract] | |
Summary Of Changes In Carrying Amounts Of Goodwill | Americas EMEA Asia-Pacific Total Balance as of August 31, 2020 $ 85,461 $ 9,060 $ 1,210 $ 95,731 Translation adjustments - ( 9 ) ( 1 ) ( 10 ) Balance as of November 30, 2020 $ 85,461 $ 9,051 $ 1,209 $ 95,721 |
Summary Of Definite-Lived Intangible Assets | November 30, August 31, 2020 2020 Gross carrying amount $ 36,340 $ 36,363 Accumulated amortization ( 28,072 ) ( 27,730 ) Net carrying amount $ 8,268 $ 8,633 |
Summary Of Changes In Carrying Amounts Of Definite-Lived Intangible Assets By Segment | Americas EMEA Asia-Pacific Total Balance as of August 31, 2020 $ 6,553 $ 2,080 $ - $ 8,633 Amortization expense ( 264 ) ( 94 ) - ( 358 ) Translation adjustments - ( 7 ) - ( 7 ) Balance as of November 30, 2020 $ 6,289 $ 1,979 $ - $ 8,268 |
Schedule Of Future Estimated Amortization Expense | Trade Names Customer-Based Remainder of fiscal year 2021 $ 953 $ 128 Fiscal year 2022 1,271 170 Fiscal year 2023 1,024 - Fiscal year 2024 1,019 - Fiscal year 2025 941 - Thereafter 2,762 - Total $ 7,970 $ 298 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Leases [Abstract] | |
Right-Of-Use Assets And Lease Liabilities | November 30, August 31, 2020 2020 Assets: Operating lease right-of-use assets $ 8,815 $ 8,168 Liabilities: Current operating lease liabilities (1) 1,890 1,840 Long-term operating lease liabilities 7,141 6,520 Total operating lease liabilities $ 9,031 $ 8,360 (1) Current operating lease liabilities are classified in accrued liabilities on the Company’s condensed consolidated balance sheet. |
Future Minimum Rental Payments | Operating Leases Remainder of fiscal year 2021 $ 1,611 Fiscal year 2022 1,969 Fiscal year 2023 1,622 Fiscal year 2024 1,471 Fiscal year 2025 937 Thereafter 2,464 Total undiscounted future cash flows $ 10,074 Less: Interest ( 1,043 ) Present value of lease liabilities $ 9,031 |
Accrued And Other Liabilities (
Accrued And Other Liabilities (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Accrued And Other Liabilities [Abstract] | |
Schedule Of Accrued Liabilities | November 30, August 31, 2020 2020 Accrued advertising and sales promotion expenses $ 10,812 $ 10,787 Accrued professional services fees 2,140 1,761 Accrued sales taxes and other taxes 1,902 1,751 Short-term operating lease liability 1,890 1,840 Other 6,245 5,521 Total $ 22,989 $ 21,660 |
Schedule Of Accrued Payroll And Related Expenses | November 30, August 31, 2020 2020 Accrued incentive compensation $ 4,020 $ 5,702 Accrued payroll 4,447 4,396 Accrued profit sharing 3,655 2,726 Accrued payroll taxes 2,631 1,446 Other 673 497 Total $ 15,426 $ 14,767 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Debt [Abstract] | |
Schedule Of Short-term And Long-term Borrowings | Maturities November 30, August 31, Issuance (calendar year) 2020 2020 Credit Agreement - revolving credit facility (1)(3) Various 9/30/2025 $ 45,912 $ 95,898 Note Agreement Series A Notes - 3.39 % fixed rate (2) 11/15/2017 2021 - 2032 17,600 18,000 Series B Notes - 2.50 % fixed rate (3) 9/30/2020 11/15/2027 26,000 - Series C Notes - 2.69 % fixed rate (3) 9/30/2020 11/15/2030 26,000 - Total borrowings 115,512 113,898 Short-term portion of borrowings ( 800 ) ( 800 ) Total long-term borrowings $ 114,712 $ 113,098 (1) The Company has the ability to refinance any draw under the line of credit with successive short-term borrowings through the maturity date. Outstanding draws for which management has both the ability and intent to refinance with successive short-term borrowings for a period of at least twelve months are classified as long-term. As of November 30, 2020, the entire balance on this facility is classified as long-term and only contains amounts denominated in Euros and Pound Sterling. Euro and Pound Sterling denominated draws will fluctuate in U.S. Dollars from period to period due to changes in foreign currency exchange rates. (2) Principal payments are required semi-annually in May and November of each year in equal installments of $ 0.4 million through May 15, 2032 . The remaining outstanding principal in the amount of $ 8.4 million will become due on November 15, 2032 . (3) On September 30, 2020, the Company refinanced $ 50.0 million of existing draws under its Credit Agreement in the United States through the issuance of two new $ 26.0 million notes (“Series B Notes” and “Series C Notes”, respectively) under its Note Agreement. Interest on these new notes is payable semi-annually in May and November of each year with no principle due until the maturity date. The first interest payment on both the Series B and Series C Notes is due in May 2021 . |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Earnings Per Common Share [Abstract] | |
Schedule Of Reconciliation Of Net Income To Net Income Available To Common Shareholders | Three Months Ended November 30, 2020 2019 Net income $ 23,623 $ 12,194 Less: Net income allocated to participating securities ( 110 ) ( 67 ) Net income available to common shareholders $ 23,513 $ 12,127 |
Schedule Of Weighted Average Number Of Shares | Three Months Ended November 30, 2020 2019 Weighted-average common shares outstanding, basic 13,675 13,714 Weighted-average dilutive securities 31 32 Weighted-average common shares outstanding, diluted 13,706 13,746 |
Business Segments And Foreign_2
Business Segments And Foreign Operations (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Business Segments And Foreign Operations [Abstract] | |
Summarized Information By Reportable Segments | Unallocated For the Three Months Ended Americas EMEA Asia-Pacific Corporate (1) Total November 30, 2020: Net sales $ 54,188 $ 54,749 $ 15,622 $ - $ 124,559 Income from operations $ 14,626 $ 17,743 $ 5,060 $ ( 9,037 ) $ 28,392 Depreciation and amortization expense $ 791 $ 756 $ 75 $ 78 $ 1,700 Interest income $ 1 $ 1 $ 17 $ - $ 19 Interest expense $ 455 $ 114 $ 1 $ - $ 570 November 30, 2019: Net sales $ 46,736 $ 39,245 $ 12,575 $ - $ 98,556 Income from operations $ 10,580 $ 8,592 $ 3,202 $ ( 7,670 ) $ 14,704 Depreciation and amortization expense $ 1,172 $ 634 $ 74 $ 77 $ 1,957 Interest income $ 4 $ 1 $ 20 $ - $ 25 Interest expense $ 342 $ 99 $ 1 $ - $ 442 (1) Unallocated corporate expenses are general corporate overhead expenses not directly attributable to any one of the business segments. These expenses are reported separate from the Company’s identified segments and are included in Selling, General and Administrative expenses on the Company’s condensed consolidated statements of operations. |
Schedule Of Net Sales By Product Group | Three Months Ended November 30, 2020 2019 Maintenance products $ 114,343 $ 89,670 Homecare and cleaning products 10,216 8,886 Total $ 124,559 $ 98,556 |
Basis Of Presentation And Sum_3
Basis Of Presentation And Summary Of Significant Accounting Policies (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | Aug. 31, 2020 | |
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||
Unrealized foreign currency transactions | $ (52,000) | $ (394,000) | |
Carrying value of senior notes | 114,712,000 | $ 113,098,000 | |
Assets | 386,398,000 | 362,637,000 | |
Liabilities | 211,898,000 | 202,324,000 | |
Foreign Currency Forward Contracts [Member] | |||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||
Foreign currency forward contracts outstanding | $ 13,700,000 | ||
Foreign currency forward contracts, Maturity date | Jan. 28, 2021 | ||
Realized foreign currency transactions | $ 0 | $ 0 | |
Unrealized foreign currency transactions | 0 | $ 0 | |
Level 2 [Member] | Recurring [Member] | |||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||
Assets | 0 | ||
Liabilities | 0 | ||
Level 2 [Member] | Nonrecurring [Member] | |||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||
Liabilities | 0 | ||
Senior Notes [Member] | Level 2 [Member] | |||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||
Fair value of senior notes | 70,200,000 | ||
Carrying value of senior notes | $ 69,600,000 |
Inventories (Schedule Of Invent
Inventories (Schedule Of Inventories) (Details) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Inventories [Abstract] | ||
Product held at third-party contract manufacturers | $ 5,824 | $ 4,393 |
Raw materials and components | 5,044 | 5,034 |
Work-in-process | 449 | 385 |
Finished goods | 30,455 | 31,452 |
Total | $ 41,772 | $ 41,264 |
Property And Equipment (Schedul
Property And Equipment (Schedule Of Property And Equipment, Net) (Details) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Property Plant And Equipment [Line Items] | ||
Subtotal | $ 96,027 | $ 93,038 |
Less: accumulated depreciation and amortization | (33,420) | (32,279) |
Total | 62,607 | 60,759 |
Machinery, Equipment And Vehicles [Member] | ||
Property Plant And Equipment [Line Items] | ||
Subtotal | 20,452 | 20,434 |
Buildings And Improvements [Member] | ||
Property Plant And Equipment [Line Items] | ||
Subtotal | 28,334 | 28,271 |
Computer And Office Equipment [Member] | ||
Property Plant And Equipment [Line Items] | ||
Subtotal | 5,529 | 5,420 |
Software [Member] | ||
Property Plant And Equipment [Line Items] | ||
Subtotal | 10,101 | 9,959 |
Furniture And Fixtures [Member] | ||
Property Plant And Equipment [Line Items] | ||
Subtotal | 2,643 | 2,641 |
Capital In Progress [Member] | ||
Property Plant And Equipment [Line Items] | ||
Subtotal | 24,597 | 21,939 |
Land [Member] | ||
Property Plant And Equipment [Line Items] | ||
Subtotal | $ 4,371 | $ 4,374 |
Goodwill And Other Intangible_3
Goodwill And Other Intangible Assets (Narrative) (Details) | 3 Months Ended |
Nov. 30, 2020USD ($) | |
Goodwill And Other Intangible Assets [Abstract] | |
Impairment of goodwill | $ 0 |
Impairment charges | $ 0 |
Goodwill And Other Intangible_4
Goodwill And Other Intangible Assets (Summary Of Changes In Carrying Amounts Of Goodwill) (Details) $ in Thousands | 3 Months Ended |
Nov. 30, 2020USD ($) | |
Goodwill [Line Items] | |
Balance, beginning | $ 95,731 |
Translation adjustments | (10) |
Balance, ending | 95,721 |
Americas [Member] | |
Goodwill [Line Items] | |
Balance, beginning | 85,461 |
Balance, ending | 85,461 |
EMEA [Member] | |
Goodwill [Line Items] | |
Balance, beginning | 9,060 |
Translation adjustments | (9) |
Balance, ending | 9,051 |
Asia-Pacific [Member] | |
Goodwill [Line Items] | |
Balance, beginning | 1,210 |
Translation adjustments | (1) |
Balance, ending | $ 1,209 |
Goodwill And Other Intangible_5
Goodwill And Other Intangible Assets (Summary Of Definite-Lived Intangible Assets) (Details) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Goodwill And Other Intangible Assets [Abstract] | ||
Gross carrying amount | $ 36,340 | $ 36,363 |
Accumulated amortization | (28,072) | (27,730) |
Net carrying amount | $ 8,268 | $ 8,633 |
Goodwill And Other Intangible_6
Goodwill And Other Intangible Assets (Summary Of Changes In Carrying Amounts Of Definite-Lived Intangible Assets By Segment) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||
Beginning balance | $ 8,633 | |
Amortization expense | (358) | $ (650) |
Translation adjustments | (7) | |
Ending balance | 8,268 | |
Americas [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Beginning balance | 6,553 | |
Amortization expense | (264) | |
Translation adjustments | ||
Ending balance | 6,289 | |
EMEA [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Beginning balance | 2,080 | |
Amortization expense | (94) | |
Translation adjustments | (7) | |
Ending balance | 1,979 | |
Asia-Pacific [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Beginning balance | ||
Amortization expense | ||
Translation adjustments | ||
Ending balance |
Goodwill And Other Intangible_7
Goodwill And Other Intangible Assets (Schedule Of Future Estimated Amortization Expense) (Details) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Net carrying amount | $ 8,268 | $ 8,633 |
Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Remainder of fiscal year 2021 | 953 | |
Fiscal year 2022 | 1,271 | |
Fiscal year 2023 | 1,024 | |
Fiscal year 2024 | 1,019 | |
Fiscal year 2025 | 941 | |
Thereafter | 2,762 | |
Net carrying amount | 7,970 | |
Customer-Based [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Remainder of fiscal year 2021 | 128 | |
Fiscal year 2022 | 170 | |
Net carrying amount | $ 298 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) | 3 Months Ended | |
Nov. 30, 2020USD ($)item | Nov. 30, 2019USD ($) | |
Leases [Abstract] | ||
Short term lease | $ 0 | |
Lease expense | 500,000 | $ 500,000 |
Lease payments | 500,000 | 500,000 |
Variable lease | $ 0 | $ 0 |
Weighted-average lease term | 6 years 6 months | |
Weighted-average discount rate | 3.00% | |
Number of leases not yet commenced | item | 0 | |
Additional right-of-use assets | $ 1,000,000 |
Leases (Right-Of-Use Assets And
Leases (Right-Of-Use Assets And Lease Liabilities) (Details) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 | |
Leases [Abstract] | |||
Operating lease right-of-use assets | $ 8,815 | $ 8,168 | |
Current operating lease liabilities | [1] | 1,890 | 1,840 |
Long-term operating lease liabilities | 7,141 | 6,520 | |
Total operating lease liabilities | $ 9,031 | $ 8,360 | |
[1] | Current operating lease liabilities are classified in accrued liabilities on the Company’s condensed consolidated balance sheet. |
Leases (Future Minimum Rental P
Leases (Future Minimum Rental Payments) (Details) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Leases [Abstract] | ||
Remainder of fiscal year 2021 | $ 1,611 | |
Fiscal year 2022 | 1,969 | |
Fiscal year 2023 | 1,622 | |
Fiscal year 2024 | 1,471 | |
Fiscal year 2025 | 937 | |
Thereafter | 2,464 | |
Total undiscounted future cash flows | 10,074 | |
Less: Interest | (1,043) | |
Total operating lease liabilities | $ 9,031 | $ 8,360 |
Accrued And Other Liabilities_2
Accrued And Other Liabilities (Schedule Of Accrued Liabilities) (Details) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 | |
Accrued And Other Liabilities [Abstract] | |||
Accrued advertising and sales promotion expenses | $ 10,812 | $ 10,787 | |
Accrued professional services fees | 2,140 | 1,761 | |
Accrued sales taxes and other taxes | 1,902 | 1,751 | |
Short-term operating lease liability | [1] | 1,890 | 1,840 |
Other | 6,245 | 5,521 | |
Total | $ 22,989 | $ 21,660 | |
[1] | Current operating lease liabilities are classified in accrued liabilities on the Company’s condensed consolidated balance sheet. |
Accrued And Other Liabilities_3
Accrued And Other Liabilities (Schedule Of Accrued Payroll And Related Expenses) (Details) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Accrued And Other Liabilities [Abstract] | ||
Accrued incentive compensation | $ 4,020 | $ 5,702 |
Accrued payroll | 4,447 | 4,396 |
Accrued profit sharing | 3,655 | 2,726 |
Accrued payroll taxes | 2,631 | 1,446 |
Other | 673 | 497 |
Total | $ 15,426 | $ 14,767 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) $ in Millions | 1 Months Ended | 3 Months Ended | |
Aug. 31, 2020 | Nov. 30, 2020USD ($)agreement | Mar. 16, 2020USD ($) | |
Debt Instrument [Line Items] | |||
Number of agreements | agreement | 2 | ||
Seventh Amended Credit Facility [Member] | |||
Debt Instrument [Line Items] | |||
Revolving credit facility, amount | $ 150 | ||
Consolidated leverage ratio | 3.5 | ||
Consolidated interest coverage ratio | 3 | ||
Other Unsecured Debt [Member] | |||
Debt Instrument [Line Items] | |||
Revolving credit facility, amount | $ 125 | ||
First Amendment To Credit Agreement [Member] | |||
Debt Instrument [Line Items] | |||
Revolving credit facility, expiration date | Mar. 16, 2025 | Sep. 30, 2025 | |
Europe, The Middle East, Africa And India Subsidiary [Member] | Amended And Restated Credit Agreement [Member] | |||
Debt Instrument [Line Items] | |||
Revolving credit facility, amount | $ 100 |
Debt (Schedule Of Short-term An
Debt (Schedule Of Short-term And Long-term Borrowings) (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Nov. 30, 2020 | Sep. 30, 2020 | Aug. 31, 2020 | ||
Debt Instrument [Line Items] | ||||
Total Borrowings | $ 115,512 | $ 113,898 | ||
Short-term portion of borrowings | (800) | (800) | ||
Long-term borrowings | $ 114,712 | 113,098 | ||
Line of credit | $ 50,000 | |||
Series A Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Issuance | [1] | Nov. 15, 2017 | ||
Maturity date | May 15, 2032 | |||
Interest rate | 3.39% | |||
Total Borrowings | [1] | $ 17,600 | 18,000 | |
Principal payment frequency of periodic payment | semi-annually | |||
Periodic payment amount | $ 400 | |||
Series A Notes, Due November 15, 2032 [Member] | ||||
Debt Instrument [Line Items] | ||||
Maturity date | Nov. 15, 2032 | |||
Remaining principal payment | $ 8,400 | |||
Series B Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Issuance | [2] | Sep. 30, 2020 | ||
Maturity date | [2] | Nov. 15, 2027 | ||
Interest rate | 2.50% | |||
Total Borrowings | [2] | $ 26,000 | ||
Series C Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Issuance | [2] | Sep. 30, 2020 | ||
Maturity date | [2] | Nov. 15, 2030 | ||
Interest rate | 2.69% | |||
Total Borrowings | [2] | $ 26,000 | ||
Series B And C Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Total Borrowings | $ 26,000 | |||
Principal payment frequency of periodic payment | semi-annually | |||
Date of first interest payment | May 2021 | |||
Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Maturity date | [2],[3] | Sep. 30, 2025 | ||
Total Borrowings | [2],[3] | $ 45,912 | $ 95,898 | |
Minimum [Member] | Series A Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Maturity year | 2021 | |||
Maximum [Member] | Series A Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Maturity year | 2032 | |||
[1] | Principal payments are required semi-annually in May and November of each year in equal installments of $ 0.4 million through May 15, 2032 . The remaining outstanding principal in the amount of $ 8.4 million will become due on November 15, 2032 . | |||
[2] | On September 30, 2020, the Company refinanced $ 50.0 million of existing draws under its Credit Agreement in the United States through the issuance of two new $ 26.0 million notes (“Series B Notes” and “Series C Notes”, respectively) under its Note Agreement. Interest on these new notes is payable semi-annually in May and November of each year with no principle due until the maturity date. The first interest payment on both the Series B and Series C Notes is due in May 2021 . | |||
[3] | The Company has the ability to refinance any draw under the line of credit with successive short-term borrowings through the maturity date. Outstanding draws for which management has both the ability and intent to refinance with successive short-term borrowings for a period of at least twelve months are classified as long-term. As of November 30, 2020, the entire balance on this facility is classified as long-term and only contains amounts denominated in Euros and Pound Sterling. Euro and Pound Sterling denominated draws will fluctuate in U.S. Dollars from period to period due to changes in foreign currency exchange rates. |
Share Repurchase Plan (Narrativ
Share Repurchase Plan (Narrative) (Details) $ in Thousands | 3 Months Ended |
Nov. 30, 2019USD ($) | |
Share Repurchase Plan [Abstract] | |
Total cost of repurchased shares | $ 4,957 |
Earnings Per Common Share (Narr
Earnings Per Common Share (Narrative) (Details) - shares | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Earnings Per Common Share [Abstract] | ||
Anti-dilutive stock options outstanding | 0 | 5,729 |
Earnings Per Common Share (Sche
Earnings Per Common Share (Schedule Of Reconciliation Of Net Income To Net Income Available To Common Shareholders) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Earnings Per Common Share [Abstract] | ||
Net income | $ 23,623 | $ 12,194 |
Less: Net income allocated to participating securities | (110) | (67) |
Net income available to common shareholders | $ 23,513 | $ 12,127 |
Earnings Per Common Share (Sc_2
Earnings Per Common Share (Schedule Of Weighted Average Number Of Shares) (Details) - shares shares in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Earnings Per Common Share [Abstract] | ||
Weighted-average common shares outstanding, basic | 13,675 | 13,714 |
Weighted-average dilutive securities | 31 | 32 |
Weighted-average common shares outstanding, diluted | 13,706 | 13,746 |
Revenue Recognition (Narrative)
Revenue Recognition (Narrative) (Details) - USD ($) | 3 Months Ended | ||
Nov. 30, 2020 | Nov. 30, 2019 | Aug. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||
Accrued liabilities | $ 22,989,000 | $ 21,660,000 | |
Reduction to revenue | 124,559,000 | $ 98,556,000 | |
Accounting Standards Update 2014-09 [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Contract liabilities | 2,300,000 | 1,400,000 | |
Contract assets | 0 | 0 | |
Accounting Standards Update 2014-09 [Member] | Rebate [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Accrued liabilities | 7,900,000 | 7,500,000 | |
Reduction to revenue | (5,300,000) | (5,000,000) | |
Accounting Standards Update 2014-09 [Member] | Cash Discounts [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Reduction to revenue | (1,200,000) | $ (1,000,000) | |
Allowance for cash discount | $ 400,000 | $ 500,000 |
Commitments And Contingencies (
Commitments And Contingencies (Narrative) (Details) | 3 Months Ended |
Nov. 30, 2020USD ($)claim | |
Loss Contingencies [Line Items] | |
Number of pending claims | claim | 0 |
Purchase Commitment [Member] | |
Loss Contingencies [Line Items] | |
Commitment outstanding | $ 0 |
Indemnification Agreement 2 [Member] | |
Loss Contingencies [Line Items] | |
Liabilities related to indemnification agreement | 0 |
Senior Officers And Directors [Member] | Indemnification Agreement 1 [Member] | |
Loss Contingencies [Line Items] | |
Liabilities related to indemnification agreement | $ 0 |
Minimum [Member] | Purchase Commitment [Member] | |
Loss Contingencies [Line Items] | |
Purchase commitment period | 2 months |
Maximum [Member] | Purchase Commitment [Member] | |
Loss Contingencies [Line Items] | |
Purchase commitment period | 6 months |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Income Taxes [Abstract] | ||
Provision for income taxes | 15.70% | 14.70% |
Business Segments and Foreign_3
Business Segments and Foreign Operations (Summarized Information By Reportable Segments) (Details) $ in Thousands | 3 Months Ended | ||
Nov. 30, 2020USD ($)segment | Nov. 30, 2019USD ($) | ||
Segment Reporting Information [Line Items] | |||
Number of reportable segments | segment | 3 | ||
Net sales | $ 124,559 | $ 98,556 | |
Income from operations | 28,392 | 14,704 | |
Depreciation and amortization expense | 1,700 | 1,957 | |
Interest income | 19 | 25 | |
Interest expense | 570 | 442 | |
Unallocated Corporate [Member] | |||
Segment Reporting Information [Line Items] | |||
Income from operations | [1] | (9,037) | (7,670) |
Depreciation and amortization expense | [1] | 78 | 77 |
Americas Segment [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | 54,188 | 46,736 | |
Income from operations | 14,626 | 10,580 | |
Depreciation and amortization expense | 791 | 1,172 | |
Interest income | 1 | 4 | |
Interest expense | 455 | 342 | |
EMEA Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | 54,749 | 39,245 | |
Income from operations | 17,743 | 8,592 | |
Depreciation and amortization expense | 756 | 634 | |
Interest income | 1 | 1 | |
Interest expense | 114 | 99 | |
Asia-Pacific Segment [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | 15,622 | 12,575 | |
Income from operations | 5,060 | 3,202 | |
Depreciation and amortization expense | 75 | 74 | |
Interest income | 17 | 20 | |
Interest expense | $ 1 | $ 1 | |
[1] | Unallocated corporate expenses are general corporate overhead expenses not directly attributable to any one of the business segments. These expenses are reported separate from the Company’s identified segments and are included in Selling, General and Administrative expenses on the Company’s condensed consolidated statements of operations. |
Business Segments And Foreign_4
Business Segments And Foreign Operations (Schedule Of Net Sales By Product Group) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Revenue from External Customer [Line Items] | ||
Net sales | $ 124,559 | $ 98,556 |
Maintenance Products [Member] | ||
Revenue from External Customer [Line Items] | ||
Net sales | 114,343 | 89,670 |
Homecare And Cleaning Products [Member] | ||
Revenue from External Customer [Line Items] | ||
Net sales | $ 10,216 | $ 8,886 |
Subsequent Events (Narrative) (
Subsequent Events (Narrative) (Details) | Dec. 07, 2020$ / shares | Nov. 30, 2020 |
Subsequent Events [Line Items] | ||
Dividend payable, declared date | Dec. 7, 2020 | |
Dividends payable, date to be paid | Jan. 29, 2021 | |
Dividend payable, record date | Jan. 15, 2021 | |
Seventh Amended Credit Facility [Member] | ||
Subsequent Events [Line Items] | ||
Consolidated leverage ratio | 3.5 | |
Subsequent Events [Member] | ||
Subsequent Events [Line Items] | ||
Cash dividend declared | $ 0.67 |