Document and Entity Information
Document and Entity Information Document - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 28, 2018 | Jun. 30, 2017 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | NAUTILUS, INC. | ||
Entity Central Index Key | 1,078,207 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 30,327,978 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 567,409,298 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 27,893 | $ 47,874 |
Available-for-sale securities | 57,303 | 31,743 |
Trade receivables, net of allowances of $119 and $170 | 42,685 | 45,458 |
Inventories | 53,354 | 47,030 |
Prepaids and other current assets | 7,240 | 8,020 |
Income taxes receivable | 17 | 3,231 |
Total current assets | 188,492 | 183,356 |
Property, plant and equipment, net | 15,827 | 17,468 |
Goodwill | 62,030 | 61,888 |
Other intangible assets, net | 57,743 | 69,800 |
Deferred income tax assets, non-current | 0 | 11 |
Other assets | 684 | 543 |
Total assets | 324,776 | 333,066 |
Liabilities and Shareholders' Equity | ||
Trade payables | 66,899 | 66,020 |
Accrued liabilities | 10,764 | 12,892 |
Warranty obligations, current portion | 3,718 | 3,500 |
Note payable, current portion, net of unamortized debt issuance costs of $7 and $7 | 15,993 | 15,993 |
Total current liabilities | 97,374 | 98,405 |
Warranty obligations, non-current | 2,399 | 3,950 |
Income taxes payable, non-current | 2,955 | 2,403 |
Deferred income tax liabilities, non-current | 8,558 | 16,991 |
Other long-term liabilities | 2,315 | 2,481 |
Note payable, non-current, net of unamortized debt issuance costs of $14 and $21 | 31,986 | 47,979 |
Total liabilities | 145,587 | 172,209 |
Commitments and contingencies (Note 21) | ||
Common stock - no par value, 75,000 shares authorized, 30,305 and 30,825 shares issued and outstanding | 0 | 578 |
Retained earnings | 179,448 | 161,496 |
Accumulated other comprehensive loss | (259) | (1,217) |
Total shareholders' equity | 179,189 | 160,857 |
Total liabilities and shareholders' equity | $ 324,776 | $ 333,066 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Condensed Consolidated Balance Sheet Parenthetical [Abstract] | ||
Allowance for Doubtful Accounts Receivable, Current | $ 119 | $ 170 |
Unamortized debt issuance costs | 7 | 7 |
Unamortized debt issuance costs, noncurrent | $ 14 | $ 21 |
Common stock, par value | $ 0 | $ 0 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 30,305,000 | 30,825,000 |
Common stock, shares outstanding | 30,305,000 | 30,825,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | |||
Net sales | $ 406,184 | $ 406,039 | $ 335,764 |
Cost of sales | 202,302 | 194,514 | 162,530 |
Gross profit | 203,882 | 211,525 | 173,234 |
Operating expenses: | |||
Selling and marketing | 116,222 | 115,437 | 101,618 |
General and administrative | 27,111 | 28,775 | 21,441 |
Research and development | 15,446 | 13,919 | 9,904 |
Asset impairment charge | 8,800 | 0 | 0 |
Total operating expenses | 167,579 | 158,131 | 132,963 |
Operating income | 36,303 | 53,394 | 40,271 |
Other income (expense): | |||
Interest income | 653 | 234 | 218 |
Interest expense | (1,552) | (1,928) | (22) |
Other, net | 301 | (119) | (445) |
Total other expense, net | (598) | (1,813) | (249) |
Income from continuing operations before income taxes | 35,705 | 51,581 | 40,022 |
Income tax expense | 8,080 | 16,480 | 13,219 |
Income from continuing operations | 27,625 | 35,101 | 26,803 |
Discontinued operations: | |||
Loss from discontinued operations before income taxes | (1,713) | (1,077) | (601) |
Income tax benefit of discontinued operations | (154) | (400) | |
Loss from discontinued operations | (1,358) | (923) | (201) |
Net income | $ 26,267 | $ 34,178 | $ 26,602 |
Basic net income per share | |||
Basic income per share from continuing operations (in dollars per share) | $ 0.90 | $ 1.13 | $ 0.86 |
Basic income (loss) per share from discontinued operations (in dollars per share) | (0.04) | (0.03) | (0.01) |
Basic net income per share (in dollars per share) | 0.86 | 1.10 | 0.85 |
Diluted net income per share | |||
Diluted income per share from continuing operations (in dollars per share) | 0.89 | 1.12 | 0.85 |
Diluted income (loss) per share from discontinued operations (in dollars per share) | (0.04) | (0.03) | (0.01) |
Diluted net income per share (in dollars per share) | $ 0.85 | $ 1.09 | $ 0.84 |
Shares used in per share calculations: | |||
Basic (in shares) | 30,671 | 31,032 | 31,288 |
Diluted (in shares) | 31,010 | 31,301 | 31,589 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 26,267 | $ 34,178 | $ 26,602 |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Unrealized gain (loss) on marketable securities, net of income tax expense (benefit) of $(27), $5, and $1 | (56) | 8 | 2 |
Gain (loss) on derivative securities, effective portion, net of income tax expense (benefit) of $171, $(14), and $0 | 240 | (24) | 0 |
Foreign currency translation adjustment, net of income tax expense (benefit) of $1, $(5), and $17 | 774 | 126 | (1,021) |
Other comprehensive income (loss) | 958 | 110 | (1,019) |
Comprehensive income | $ 27,225 | $ 34,288 | $ 25,583 |
Consolidated Statements of Com6
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Unrealized gain (loss) on marketable securities tax expense (benefit) | $ (27) | $ 5 | $ 1 |
Loss on derivative securities tax benefit (expense) | 171 | (14) | 0 |
Foreign currency translation tax expense (benefit) | $ 1 | $ (5) | $ 17 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) |
Beginning balance at Dec. 31, 2014 | $ 111,072 | $ 8,033 | $ 103,347 | $ (308) |
Balance, shares at Dec. 31, 2014 | 31,333 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 26,602 | 26,602 | ||
Unrealized loss on marketable securities, net of income tax benefit of $(27) | 2 | 2 | ||
Gain on derivative securities, effective portion, net of income tax expense of $171 | 0 | |||
Foreign currency translation adjustment, including income tax expense (benefit) | (1,021) | (1,021) | ||
Stock-based compensation expense | 1,484 | $ 1,484 | ||
Common stock issued under equity compensation plan, shares | 377 | |||
Common stock issued under equity compensation plan, net of shares withheld for tax payments | 275 | $ 275 | ||
Common stock issued under employee stock purchase plan, shares | 7 | |||
Common stock issued under employee stock purchase plan | 116 | $ 116 | ||
Tax benefit related to stock-based awards | 28 | $ 28 | ||
Repurchased shares, in shares | (712) | |||
Repurchased shares | (11,567) | $ (9,140) | (2,427) | |
Balance, shares at Dec. 31, 2015 | 31,005 | |||
Ending balance at Dec. 31, 2015 | 126,991 | $ 796 | 127,522 | (1,327) |
Beginning balance at Dec. 31, 2014 | 111,072 | $ 8,033 | 103,347 | (308) |
Balance, shares at Dec. 31, 2014 | 31,333 | |||
Balance, shares at Dec. 31, 2017 | 30,305 | |||
Ending balance at Dec. 31, 2017 | 179,189 | $ 0 | 179,448 | (259) |
Beginning balance at Dec. 31, 2015 | 126,991 | $ 796 | 127,522 | (1,327) |
Balance, shares at Dec. 31, 2015 | 31,005 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 34,178 | 34,178 | ||
Unrealized loss on marketable securities, net of income tax benefit of $(27) | 8 | 8 | ||
Gain on derivative securities, effective portion, net of income tax expense of $171 | (24) | (24) | ||
Foreign currency translation adjustment, including income tax expense (benefit) | 126 | 126 | ||
Stock-based compensation expense | 2,613 | $ 2,613 | ||
Common stock issued under equity compensation plan, shares | 116 | |||
Common stock issued under equity compensation plan, net of shares withheld for tax payments | 117 | $ 117 | ||
Common stock issued under employee stock purchase plan, shares | 24 | |||
Common stock issued under employee stock purchase plan | 381 | $ 381 | ||
Tax benefit related to stock-based awards | 1,857 | $ 1,857 | ||
Repurchased shares, in shares | (320) | |||
Repurchased shares | (5,390) | $ (5,186) | (204) | |
Balance, shares at Dec. 31, 2016 | 30,825 | |||
Ending balance at Dec. 31, 2016 | 160,857 | $ 578 | 161,496 | (1,217) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 26,267 | 26,267 | ||
Unrealized loss on marketable securities, net of income tax benefit of $(27) | (56) | (56) | ||
Gain on derivative securities, effective portion, net of income tax expense of $171 | 240 | |||
Foreign currency translation adjustment, including income tax expense (benefit) | 774 | 774 | ||
Stock-based compensation expense | 1,856 | $ 1,884 | (28) | |
Common stock issued under equity compensation plan, shares | 231 | |||
Common stock issued under equity compensation plan, net of shares withheld for tax payments | (181) | $ (181) | ||
Common stock issued under employee stock purchase plan, shares | 37 | |||
Common stock issued under employee stock purchase plan | 487 | $ 487 | ||
Repurchased shares, in shares | (788) | |||
Repurchased shares | (11,055) | $ (2,768) | (8,287) | |
Balance, shares at Dec. 31, 2017 | 30,305 | |||
Ending balance at Dec. 31, 2017 | $ 179,189 | $ 0 | $ 179,448 | $ (259) |
Consolidated Statements of Sto8
Consolidated Statements of Stockholders' Equity - Parenthetical - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Stockholders' Equity [Abstract] | |||
Unrealized gain (loss) on marketable securities tax expense (benefit) | $ (27) | $ 5 | $ 1 |
Loss on derivative securities tax benefit | (171) | 14 | 0 |
Foreign currency translation tax expense (benefit) | $ 1 | $ (5) | $ 17 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | |||
Income from continuing operations | $ 27,625 | $ 35,101 | $ 26,803 |
Loss from discontinued operations | (1,358) | (923) | (201) |
Net income | 26,267 | 34,178 | 26,602 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Asset impairment charge | 8,800 | 0 | 0 |
Depreciation and amortization | 8,643 | 7,874 | 3,412 |
Bad debt expense | 311 | 289 | 786 |
Inventory lower-of-cost-or-market/NRV adjustments | 1,067 | 245 | 1,583 |
Stock-based compensation expense | 1,856 | 2,613 | 1,484 |
Loss on asset disposals | 56 | 147 | 313 |
Deferred income taxes, net of valuation allowances | (8,556) | 9,510 | 11,669 |
Excess tax benefit related to stock-based awards | 0 | (1,857) | (28) |
Other | (117) | 5 | 0 |
Changes in operating assets and liabilities: | |||
Trade receivables | 2,516 | (694) | (6,812) |
Inventories | (7,526) | (3,110) | (7,147) |
Prepaids and other current assets | 1,080 | (1,415) | 1,365 |
Income taxes receivable | 3,214 | (2,792) | (389) |
Trade payables | 449 | 6,464 | 4,506 |
Accrued liabilities, including warranty obligations | (3,044) | (5,606) | 3,776 |
Net cash provided by operating activities | 35,016 | 45,851 | 41,120 |
Cash flows from investing activities: | |||
Acquisition of business, net of cash acquired | 0 | (3,468) | (114,062) |
Purchases of property, plant and equipment and intangible assets | (3,792) | (4,656) | (5,734) |
Purchases of available-for-sale-securities | (88,413) | (34,739) | (61,933) |
Proceeds from maturities of available-for-sale securities | 62,939 | 32,923 | 55,292 |
Proceeds from sales of available-for-sale securities | 0 | 71 | 3,602 |
Net cash used in investing activities | (29,266) | (9,869) | (122,835) |
Cash flows from financing activities: | |||
Proceeds from long-term debt | 0 | 0 | 80,000 |
Proceeds from employee stock purchases | 16,000 | 16,000 | 0 |
Proceeds from employee stock purchases | 487 | 381 | 116 |
Tax payments related to stock award issuances | 560 | 356 | 1,050 |
Excess tax benefit related to stock-based awards | (741) | (239) | (775) |
Excess tax benefit related to stock-based awards | 0 | 1,857 | 28 |
Payments for stock repurchases | (11,055) | (5,390) | (11,567) |
Net cash provided by (used in) financing activities | (26,749) | (19,035) | 68,852 |
Effect of exchange rate changes on cash and cash equivalents | 1,018 | 149 | (1,565) |
Increase (decrease) in cash and cash equivalents | (19,981) | 17,096 | (14,428) |
Beginning of year | 47,874 | 30,778 | 45,206 |
End of year | 27,893 | 47,874 | 30,778 |
Supplemental disclosure of cash flow information: | |||
Cash paid for income taxes, net | 11,630 | 11,511 | 1,308 |
Cash paid for interest | 1,545 | 1,920 | 22 |
Acquisition consideration owed but not yet paid | 0 | 0 | 2,813 |
Capital expenditures incurred but not yet paid | 404 | 210 | 1,000 |
Loan fees incurred but not yet paid | $ 0 | $ 0 | $ 36 |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | SIGNIFICANT ACCOUNTING POLICIES Organization and Business Nautilus, Inc. and subsidiaries (collectively, "Nautilus", the "Company", "we" or "us") was founded in 1986 and incorporated in the State of Washington in 1993. Our headquarters are located in Vancouver, Washington. We are committed to providing innovative, quality solutions to help people achieve their fitness goals through a fit and healthy lifestyle. Our principal business activities include designing, developing, sourcing and marketing high-quality cardio and strength fitness products and related accessories for consumer use, primarily in the U.S., Canada, and Europe. Our products are sold under some of the most-recognized brand names in the fitness industry: Nautilus ® , Bowflex ® , Octane Fitness ® , Schwinn ® and Universal ® . We market our products through two distinct distribution channels, Direct and Retail, which we consider to be separate business segments. Our Direct business offers products directly to consumers through television advertising, catalogs and the Internet. Our Retail business offers our products through a network of independent retail companies and specialty retailers with stores and websites located in the U.S. and internationally. We also derive a portion of our revenue from the licensing of our brands and intellectual property. Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and relate to Nautilus, Inc. and its subsidiaries, all of which are wholly-owned, directly or indirectly. Intercompany transactions and balances have been eliminated in consolidation. Discontinued Operations Results from discontinued operations relate to the disposal of our former Commercial business, which was completed in April 2011. We reached substantial completion of asset liquidation at December 31, 2012. Although there was no revenue related to our former Commercial business during 2015 through 2017 , we continue to have product liability and other legal expenses associated with product previously sold into the Commercial channel. Results of operations related to the Commercial business have been presented in the consolidated financial statements as discontinued operations for all periods presented. Critical Accounting 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 in the financial statements. Our critical accounting estimates relate to the following: • Sales discounts and allowances; • Goodwill and other long-term assets valuation; • Product warranty obligations; and • Unrecognized tax benefits. Actual results could differ from our estimates. Concentrations Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents held in bank accounts in excess of federally-insured limits and trade receivables. Trade receivables are generally unsecured and therefore collection is affected by the economic conditions in each of our principal markets. We rely on third-party contract manufacturers in Asia for substantially all of our products and for certain product engineering support. Business operations could be disrupted by natural disasters, difficulties in transporting products from non-U.S. suppliers, as well as political, social or economic instability in the countries where contract manufacturers or their vendors or customers conduct business. While any such contract manufacturing arrangement could be replaced over time, the temporary loss of the services of any primary contract manufacturer could delay product shipments and cause a significant disruption in our operations. We derive a significant portion of our net sales from a small number of our Retail customers. A loss of business from one or more of these large customers, if not replaced with new business, would negatively affect our operating results and cash flows. In each of 2017 , 2016 and 2015 , one customer accounted for more than 10% , but less than 15% , of our net sales. Cash and Cash Equivalents All highly liquid investments with original maturities of three months or less at purchase are considered to be cash equivalents. As of December 31, 2017 , and 2016 , cash equivalents consisted of money market funds and commercial paper, and totaled $12.9 million and $13.6 million , respectively. Available-For-Sale Securities We classify our marketable securities as available-for-sale and, accordingly, record them at fair value. Marketable securities with original maturities of greater than three months and remaining maturities of less than one year are classified as short-term investments. Investments with maturities beyond one year may be classified as short-term based on their highly liquid nature and because such marketable securities represent the investment of cash that is available for current operations. Unrealized holding gains and losses, which are immaterial, are excluded from earnings and are reported net of tax in other comprehensive income until realized. Dividend and interest income is recognized when earned. Realized gains and losses, which were not material in 2017 or 2016 , are included in earnings and are derived using the specific identification method for determining the cost of securities sold. We periodically evaluate whether declines in fair values of our investments below their cost are "other-than-temporary." This evaluation consists of qualitative and quantitative factors regarding the severity and duration of the unrealized loss, as well as our ability and intent to hold the investment until a forecasted recovery occurs. For additional information, refer to Note 4, Fair Value Measurements . Derivative Securities We record our derivative securities at fair value, and our portfolio currently consists of an interest rate swap contract and foreign currency forward contracts. The fair value of our interest rate swap agreement, which is classified as a cash flow hedge, represents the estimated receipts or payments that would be made to terminate the agreement. The amounts related to the cash flow hedge are recorded as deferred gains or losses in our consolidated balance sheets with the offset recorded in accumulated other comprehensive loss, net of tax. We enter into foreign exchange forward contracts to offset the earnings impacts of exchange rate fluctuations on certain monetary assets and liabilities. A hypothetical 10% increase in interest rates, or a 10% movement in the currencies underlying our foreign currency derivative positions, would not have material impacts on our results of operations, financial position or cash flows. Gains and losses on foreign currency forward contracts are recognized in the Other, net line of our consolidated statements of operations. We do not enter into derivative instruments for any purpose other than to manage our interest rate or foreign currency exposure. That is, we do not engage in interest rate or currency exchange rate speculation using derivative instruments. Trade Receivables Accounts receivable primarily consists of trade receivables due from our Retail segment customers. We determine an allowance for doubtful accounts based on historical customer experience and other currently available evidence. When a specific account is deemed uncollectible, the account is written off against the allowance. Inventories Inventories are stated at the lower of cost and net realizable value ("NRV"), with cost determined based on the first-in, first-out method. We establish inventory allowances for excess, slow-moving and obsolete inventory based on inventory levels, expected product life and forecasted sales. Inventories are written down to NRV based on historical demand, competitive factors, changes in technology and product lifecycles. Property, Plant and Equipment Property, plant and equipment is stated at cost, net of accumulated depreciation. Improvements or betterments which add new functionality or significantly extend the life of an asset are capitalized. Expenditures for maintenance and repairs are expensed as incurred. The cost of assets retired, or otherwise disposed of, and the related accumulated depreciation, are removed from the accounts at the time of disposal. Gains and losses resulting from asset sales and dispositions are recognized in the period in which assets are disposed. Depreciation is recognized, using the straight-line method, over the lesser of the estimated useful lives of the assets or, in the case of leasehold improvements, the lease term, including renewal periods if we expect to exercise our renewal options. Depreciation on automobiles, computer software and equipment, machinery and equipment, and furniture and fixtures is determined based on estimated useful lives, which generally range from three -to- seven years. Goodwill Goodwill consists of the excess of acquisition costs over the fair values of net assets acquired in business combinations. It is not amortized, but rather is tested at the reporting unit level at least annually for impairment or more frequently if triggering events or changes in circumstances indicate impairment. Initially, qualitative factors are considered to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. Some of these qualitative factors may include macroeconomic conditions, industry and market considerations, a change in financial performance, entity-specific events, a sustained decrease in share price, and consideration of the difference between the fair value and carrying amount of a reporting unit as determined in the most recent quantitative assessment. If, through this qualitative assessment, the conclusion is made that it is more likely than not that a reporting unit's fair value is less than its carrying amount, a quantitative impairment analysis is performed. A quantitative impairment analysis involves estimating the fair value of a reporting unit using widely-accepted valuation methodologies including the income and market approaches, which requires the use of estimates and assumptions. These estimates and assumptions include revenue growth rates, discounts rates, and determination of appropriate market comparables. If the fair value of the reporting unit is less than its carrying amount, an impairment loss is recognized in an amount equal to that excess, not to exceed the carrying amount of the goodwill. We performed assessments of goodwill in the fourth quarters of 2017 , 2016 and 2015 , and determined no impairments were indicated in those years. We evaluate goodwill at the reporting unit level. Our goodwill asset related to our Canadian subsidiary is attributable to our Direct reporting unit, and our goodwill related to the Octane acquisition is attributable to our Retail reporting unit. For further information regarding goodwill, see Note 9, Goodwill . Other Intangible Assets Indefinite-lived intangible assets consist of acquired trademarks, specifically trade names. Indefinite-lived intangible assets are stated at cost and are not amortized; instead, they are tested for impairment at least annually. We review our indefinite-lived trademarks for impairment in the fourth quarter of each year and when events or changes in circumstances indicate that the assets may be impaired. The fair value of trademarks is estimated using the relief-from-royalty method to estimate the value of the cost savings and a discounted cash flows method to estimate the value of future income. The sum of these two values for each trademark is the fair value of the trademark. If the carrying amount of trademarks exceeds the estimated fair value, we calculate impairment as the excess of carrying amount over the estimate of fair value. We tested our indefinite-lived trademarks for impairment in the fourth quarters of 2017 , 2016 and 2015 . During the fourth quarter of 2017 , we identified impairment indicators in our Octane Fitness brand name originally acquired through the Octane Fitness acquisition on December 31, 2015 . Ongoing weakness in the specialty retail channel, as a result of retailer consolidation, has had a negative impact on Octane branded sales and projected growth trends. We utilized the relief-from-royalty method to quantify the impairment, resulting in an $8.8 million non-cash impairment charge for 2017 . The impairment charge is recorded in operating expenses on the consolidated statements of operations. We determined no impairment was indicated in 2016 and 2015 for our indefinite-lived intangible assets. Definite-lived intangible assets, primarily acquired trade names, customer relationships, patents and patent rights, are stated at cost, net of accumulated amortization, and are evaluated for impairment as discussed below under Impairment of Long-Lived Assets . We recognize amortization expense for our definite-lived intangible assets on a straight-line basis over the estimated useful lives. For further information regarding other intangible assets, see Note 10, Other Intangible Assets . Impairment of Long-Lived Assets Long-lived assets, including property, plant and equipment and definite-lived intangible assets, are evaluated for impairment when events or circumstances indicate the carrying value may be impaired. When such an event or condition occurs, we estimate the future undiscounted cash flows to be derived from the use and eventual disposition of the asset to determine whether a potential impairment exists. If the carrying value exceeds estimated future undiscounted cash flows, we record impairment expense to reduce the carrying value of the asset to its estimated fair value. No impairment charges were recorded in 2017 , 2016 and 2015 . Share Repurchases Shares of our common stock may be repurchased from time to time as authorized by our Board of Directors. Repurchases may be made in open market transactions at prevailing prices, in privately negotiated transactions, or by other means in accordance with federal securities laws. Share repurchases are funded from existing cash balances, and repurchased shares are retired and returned to unissued authorized shares. These repurchases are accounted for as reductions to our common stock to the extent available with remaining amounts allocated against retained earnings. Revenue Recognition Direct and Retail product sales and shipping revenues are recorded when products are shipped and title passes to customers. In most instances, Retail sales to customers are made pursuant to a sales contract that provides for transfer of both title and risk of loss to the customer upon our delivery to the carrier. For Direct sales, revenue is generally recognized when products are shipped. Revenue is recognized net of applicable sales incentives, such as promotional discounts, rebates and return allowances. We estimate the revenue impact of incentive programs based on the planned duration of the program and historical experience. Many Direct business customers finance their purchases through a third-party credit provider, for which we pay a commission or financing fee to the credit provider. Revenue for such transactions is recognized based on the sales price charged to the customer and the related commission or financing fee is included in selling and marketing expense. Sales Discounts and Returns Allowance Product sales and shipping revenues are reported net of promotional discounts and return allowances. We estimate the revenue impact of retail sales incentive programs based on the planned duration of the program and historical experience. If the amount of sales incentives is reasonably estimable, the impact of such incentives is recorded at the later of the time the customer is notified of the sales incentive or the time of the sale. We estimate our liability for product returns based on historical experience and record the expected obligation as a reduction of revenue. If actual return costs differ from previous estimates, the amount of the liability and corresponding revenue are adjusted in the period in which such costs occur. Activity in our sales discounts and returns allowance was as follows (in thousands): 2017 2016 2015 Balance, January 1 $ 5,901 $ 5,677 $ 4,296 Charges to reserve 18,377 12,935 16,700 Reductions for sales discounts and returns (17,358 ) (12,711 ) (15,569 ) Business acquisition (Note 2) — — 250 Balance, December 31 $ 6,920 $ 5,901 $ 5,677 Taxes Collected from Customers and Remitted to Governmental Authorities Taxes collected from customers and remitted to governmental authorities are recorded on a net basis and excluded from net sales. Shipping and Handling Fees Shipping and handling fees billed to customers are recorded net of discounts and included in both net sales and cost of sales. Cost of Sales Cost of sales primarily consists of: inventory costs; royalties paid to third parties; employment and occupancy costs of warehouse and distribution facilities, including depreciation of improvements and equipment; transportation expenses; product warranty expenses; distribution information systems expenses; and allocated expenses for shared administrative functions. Product Warranty Obligations Our products carry defined warranties for defects in materials or workmanship which, according to their terms, generally obligate us to pay the costs of supplying and shipping replacement parts to customers and, in certain instances, pay for labor and other costs to service products. Outstanding product warranty periods range from thirty days to, in limited circumstances, the lifetime of certain product components. We record a liability at the time of sale for the estimated costs of fulfilling future warranty claims. If necessary, we adjust the liability for specific warranty-related matters when they become known and are reasonably estimable. Estimated warranty expense is included in cost of sales, based on historical warranty claim experience and available product quality data. Warranty expense is affected by the performance of new products, significant manufacturing or design defects not discovered until after the product is delivered to the customer, product failure rates, and higher or lower than expected repair costs. If warranty expense differs from previous estimates, or if circumstances change such that the assumptions inherent in previous estimates are no longer valid, the amount of product warranty obligations is adjusted accordingly. Litigation and Loss Contingencies From time to time, we may be involved in various claims, lawsuits and other proceedings. These legal and tax proceedings involve uncertainty as to the eventual outcomes and losses which may be realized when one or more future events occur or fail to occur. We record expenses for litigation and loss contingencies as a component of general and administrative expense when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. When a loss contingency is not both probable and estimable, we do not establish an accrued liability. However, if the loss (or an additional loss in excess of the accrual) is at least a reasonable possibility and material, then we disclose an estimate of the possible loss or range of loss, if such estimate can be made, or disclose that an estimate cannot be made. Advertising and Promotion We expense our advertising and promotion costs as incurred. Production costs of television advertising commercials are recorded in prepaids and other current assets until the initial broadcast, at which time such costs are expensed. Advertising and promotion costs are included in selling and marketing expenses and totaled $66.4 million , $60.7 million and $54.8 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Prepaid advertising and promotion costs were $1.5 million and $3.5 million as of December 31, 2017 and 2016 , respectively. Research and Development Internal research and development costs, which primarily consist of salaries and wages, employee benefits, expenditures for materials, and fees to use licensed technologies, are expensed as incurred. Third-party research and development costs for products under development or being researched, if any, are expensed as the contracted work is performed. In addition, we capitalize costs to develop software for internal use in accordance with accounting guidance. Income Taxes We account for income taxes based on the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates expected to be in effect when the temporary differences are expected to be included, as income or expense, in the applicable tax return. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the period of the enactment. Valuation allowances are provided against deferred income tax assets if we determine it is more likely than not that such assets will not be realized. Unrecognized Tax Benefits We recognize a tax benefit from an uncertain tax position when it is more likely than not that the position will be sustained based on the technical merits of the position upon examination, including resolutions of any related appeals or litigation. We recognize tax-related interest and penalties as a component of income tax expense. Foreign Currency Translation We translate the accounts of our non-U.S. subsidiaries into U.S. dollars as follows: revenues, expenses, gains and losses are translated at weighted-average exchange rates during the year; and assets and liabilities are translated at the exchange rate on the balance sheet date. Translation gains and losses are reported in our consolidated balance sheets as a component of accumulated other comprehensive income. Gains and losses arising from foreign currency transactions, including transactions between us and our non-U.S. subsidiaries, are recorded as a component of other income (expense) in our consolidated statements of operations. Fair Value of Financial Instruments The carrying values of cash and cash equivalents, trade receivables, prepaids and other current assets, trade payables and accrued liabilities approximate fair value due to their short maturities. For additional information on financial instruments recorded at fair value on a recurring basis as of December 31, 2017 and 2016 , refer to Note 4, Fair Value Measurements . Stock-Based Compensation We recognize stock-based compensation expense on a straight-line basis over the applicable vesting period, based on the grant-date fair value of the award. To the extent a stock-based award is subject to performance conditions, the amount of expense recorded in a given period, if any, reflects our assessment of the probability of achieving the performance targets. Fair value of stock options is estimated using the Black-Scholes-Merton option valuation model; fair value of performance share unit ("PSU") awards, restricted stock unit ("RSU") awards and restricted stock awards ("RSA") is based on the closing market price on the day preceding the grant. Prior to our adoption of Financial Accounting Standards Board's ("FASB") Accounting Standards Update ("ASU") 2016-09 in January 2017, we estimated future forfeitures, at the time of grant and in subsequent periods, based on historical turnover rates, previous forfeiture experience and changes in the business or key personnel that would suggest future forfeitures may differ from historical data. We recognized compensation expense for only those stock options and other stock-based awards that were expected to vest. We reevaluated estimated forfeitures monthly and, if applicable, recognized a cumulative effect adjustment in the period of the change if the revised estimate of the impact of forfeitures differed significantly from the previous estimate. With our adoption of ASU 2016-09, we changed our accounting treatment of forfeiture expense reversals from "at vest date" to "at forfeiture date." As a result, we no longer estimate future forfeitures prior to their actual occurrence. Shares to be issued upon the exercise of stock options or the vesting of stock awards will come from newly issued shares. Income Per Share Amounts Basic income per share amounts were computed using the weighted average number of common shares outstanding. Diluted income per share amounts were calculated using the number of basic weighted average shares outstanding increased by dilutive potential common shares related to stock-based awards, as determined by the treasury stock method. New Accounting Pronouncements Newly-Adopted Pronouncements ASU 2017-04 In January 2017, the FASB issued ASU 2017-04, "Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment." ASU 2017-04 simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. An entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, if applicable. The loss recognized should not exceed the total amount of goodwill allocated to the reporting unit. The same impairment test also applies to any reporting unit with a zero or negative carrying amount. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. ASU 2017-04 is effective for public companies' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2019, on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed after January 1, 2017. Our early adoption of ASU 2017-04 for our annual goodwill impairment testing as of October 1, 2017 did not have a material effect on our financial position, results of operations or cash flows. ASU 2016-09 In March 2016, the FASB issued ASU 2016-09, "Compensation - Stock Compensation (Topic 718) - Improvements to Employee Share-Based Payment Accounting." ASU 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted subject to certain requirements, and the method of application (i.e., retrospective, modified retrospective or prospective) depends on the transaction area that is being amended. Related to forfeitures, we changed our accounting treatment of forfeiture expense reversals from "at vest date" to "at forfeiture date." We applied the guidance on a modified retrospective basis, which resulted in a $28,308 cumulative effective adjustment and reduction to beginning retained earnings as of January 1, 2017 . In addition, related to excess tax benefits, we recognized all current period expense through the statement of operations and presented excess tax benefits as an operating cash flow, applied prospectively, with no adjustment to prior periods. The adoption of ASU 2016-09 in January 2017 did not have a material impact on our financial position, results of operations or cash flows. ASU 2015-11 In July 2015, the FASB issued ASU 2015-11, “Simplifying the Measurement of Inventory (Topic 330).” ASU 2015-11 simplifies the accounting for the valuation of all inventory not accounted for using the last-in, first-out (“LIFO”) method by prescribing inventory be valued at the lower of cost and net realizable value. ASU 2015-11 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2016 on a prospective basis. Early adoption is permitted. Our adoption of ASU 2015-11 in January 2017 did not have a material effect on our financial position, results of operations or cash flows. Issued Not Yet Adopted Pronouncements ASU 2017-12 In August 2017, the FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815) - Targeted Improvements to Accounting for Hedging Activities." ASU 2017-12 provides better alignment of an entity's risk management activities and financial reporting of hedges through changes to both the designation and measurement guidance for qualifying hedging relationships. In addition, the amendments in ASU 2017-12 also simplify the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements to increase the understandability of the results of an entity's intended hedging strategies. ASU 2017-12 is effective for public companies' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2018. Early application is permitted in any interim period after issuance of the new standard, with effect of adoption reflected as of the beginning of the fiscal year of adoption. For cash flow and net investment hedges existing as of the adoption date, an entity should apply a cumulative-effect adjustment related to eliminating the separate measurement of ineffectiveness to accumulated other comprehensive income and opening retaining earnings. Amended presentation and disclosure guidance is required only prospectively, and certain transition elections are available upon adoption. While we do not expect the adoption of ASU 2017-12 to have a material effect on our business, we are evaluating any potential impact that adoption of ASU 2017-12 may have on our financial position, results of operations or cash flows. ASU 2017-09 In May 2017, the FASB issued ASU 2017-09, "Compensation - Stock Compensation (Topic 718) - Scope in Modification Accounting." ASU 2017-09 provides clarity and reduces diversity in practice and cost and complexity when applying the guidance in Topic 718 to a change to the terms or conditions of a share-based payment award. An entity should account for the effects of a modification unless all of certain criteria are met. Those criteria relate to fair value, vesting conditions and classification of the modified award. If all three conditions are the same for the modified award as for the original award, then the entity should not account for the effects of the modification. ASU 2017-09 is effective for all entities for annual periods, including interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period, for public business entities for reporting periods for which financial statements have not yet been issued. We do not expect the adoption of ASU 2017-09 to have a material effect on our financial position, results of operations or cash flows. ASU 2016-15 In August 2016, the FASB issued ASU 2016-15, "Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments." The amendments in ASU 2016-15 are intended to add or clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows, with the intent of reducing diversity in practice for the eight (8) types of cash flows identified. ASU 2016-15 is effective for public companies' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted. Entities must apply the guidance retrospectively to all periods presented, but may apply it prospectively if retrospective application would be impracticable. We do not expect the adoption of ASU 2016-15 to have a material effect on our financial position, results of operations or cash flows. ASU 2016-13 In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments." The amendments in ASU 2016-13 replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires c |
Business Acquisition
Business Acquisition | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Business Acquisition | BUSINESS ACQUISITION On December 31, 2015 , we acquired all of the outstanding capital stock of OF Holdings, Inc., sole parent of Octane Fitness, LLC ("Octane") for an aggregate base purchase price of $115.0 million , plus net adjustments for working capital and cash acquired on the closing date. We funded the acquisition through an $80.0 million term loan and cash on hand. Based in Brooklyn Park, Minnesota, Octane is a leader in zero-impact training with a line of fitness equipment focused on Retail specialty and commercial channels. The acquisition of Octane strengthened and diversified our brand portfolio, broadened our distribution and deepened our talent pool. Octane's business is highly complementary to our existing business from both product and channel perspectives. Purchase Price Allocation Acquired assets and liabilities were recorded at estimated fair value as of the acquisition date, and subsequently adjusted and finalized during 2016 . The excess of the purchase price over the fair value of identifiable net assets resulted in the recognition of goodwill of $59.7 million, all of which was assigned to the Retail segment. The goodwill is not deductible for income tax purposes. The following table summarizes the fair values of the net assets acquired and liabilities assumed as of the acquisition date, including all measurement period adjustments (in thousands): Final valuation at December 31, 2016 Cash $ 7,759 Accounts receivable 12,476 Inventories 13,134 Prepaid expenses 885 Deferred tax assets 1,303 Property, plant and equipment 3,372 Intangible assets 63,100 Total assets acquired 102,029 Accounts payable 6,497 Accrued liabilities 2,968 Warranty obligations 5,550 Deferred tax liabilities, non-current 21,033 Other non-current liabilities 390 Total liabilities assumed 36,438 Net identifiable assets acquired 65,591 Goodwill 59,705 Net assets acquired $ 125,296 Summary of Unaudited Pro Forma Information The following table reflects the unaudited pro forma consolidated results of operations for the periods presented, as though the acquisition of Octane had occurred on January 1, 2014 (in thousands, except per share amounts): (unaudited) Year Ended December 31, 2016 2015 Net sales $ 406,039 $ 400,078 Net income 35,683 29,352 Net income per share: Basic $ 1.15 $ 0.94 Diluted 1.14 0.93 |
Discontinued Operation
Discontinued Operation | 12 Months Ended |
Dec. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operation | DISCONTINUED OPERATIONS Following is a summary of certain financial information regarding our discontinued operations (in thousands): Year Ended December 31, 2017 2016 2015 Loss from discontinued operations before income taxes $ (1,713 ) $ (1,077 ) $ (601 ) Income tax benefit (355 ) (154 ) (400 ) Total loss from discontinued operations $ (1,358 ) $ (923 ) $ (201 ) During 2017 , our litigation with Biosig Instruments, Inc. ("Biosig") was settled. The litigation began in 2004 and alleged patent infringement in connection with our incorporation of heart rate monitors into certain cardio products of our former Commercial business. We paid Biosig $1.2 million under the settlement, and the matter was dismissed with prejudice. The settlement was expensed in discontinued operations in 2017 |
Fair Value Measurements (Notes)
Fair Value Measurements (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Factors used in determining the fair value of financial assets and liabilities are summarized into three broad categories: • Level 1 - observable inputs such as quoted prices (unadjusted) in active liquid markets for identical securities as of the reporting date; • Level 2 - other significant directly or indirectly observable inputs, including quoted prices for similar securities, interest rates, prepayment speeds and credit risk; or observable market prices in markets with insufficient volume and/or infrequent transactions; and • Level 3 - significant inputs that are generally unobservable inputs for which there is little or no market data available, including our own assumptions in determining fair value. Assets and liabilities measured at fair value on a recurring basis were as follows (in thousands): December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Cash Equivalents Money market funds $ 10,946 $ — $ — $ 10,946 Commercial paper — 1,996 — 1,996 Total cash equivalents 10,946 1,996 — 12,942 Available-for-Sale Securities Certificates of deposit (1) — 19,875 — 19,875 Corporate bonds — 29,239 — 29,239 U.S. government bonds — 8,189 — 8,189 Total available-for-sale securities — 57,303 — 57,303 Derivatives Interest rate swap contract — 372 — 372 Foreign currency forward contracts — 390 — 390 Total derivatives — 762 — 762 Total assets measured at fair value $ 10,946 $ 60,061 $ — $ 71,007 December 31, 2016 Level 1 Level 2 Level 3 Total Assets: Cash Equivalents Money market funds $ 9,635 $ — $ — $ 9,635 Commercial paper — 3,999 — 3,999 Total cash equivalents 9,635 3,999 — 13,634 Available-for-Sale Securities Certificates of deposit (1) — 22,820 — 22,820 Corporate bonds — 6,922 — 6,922 U.S. government bonds — 2,001 — 2,001 Total available-for-sale securities — 31,743 — 31,743 Total assets measured at fair value $ 9,635 $ 35,742 $ — $ 45,377 Liabilities: Derivatives Interest rate swap contract $ — $ (38 ) $ — $ (38 ) Total liabilities measured at fair value $ — $ (38 ) $ — $ (38 ) (1) All certificates of deposit are within current FDIC insurance limits. For our assets measured at fair value on a recurring basis, we recognize transfers between levels at the actual date of the event or change in circumstance that caused the transfer. There were no transfers between levels during the years ended December 31, 2017 and 2016 . Additionally, we did not have any changes to our valuation techniques during the years ended December 31, 2017 and 2016 . We classify our marketable securities as available-for-sale and, accordingly, record them at fair value. Level 1 investment valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 investment valuations are obtained from inputs, other than quoted market prices in active markets for identical assets, that are directly or indirectly observable in the marketplace and quoted prices in markets with limited volume or infrequent transactions. The factors or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. Unrealized holding gains and losses are excluded from earnings and are reported net of tax in comprehensive income until realized. The fair values of our interest rate swap contract and our foreign currency forward contracts are calculated as the present value of estimated future cash flows using discount factors derived from relevant Level 2 market inputs, including forward curves and volatility levels. We recognize or disclose the fair value of certain assets, such as non-financial assets, primarily property, plant and equipment, goodwill, other intangible assets and certain other long-lived assets in connection with impairment evaluations. All of our nonrecurring valuations use significant unobservable inputs and therefore fall under Level 3 of the fair value hierarchy. Other than our annual goodwill and indefinite-lived trade names impairment assessments and valuations effective as of October 1, 2017 and 2016 , we did not perform any assessments or valuations on assets or liabilities that are valued at fair value on a nonrecurring basis. During the year ended December 31, 2017 , we recorded an impairment to our indefinite-lived Octane Fitness trade name in the amount of $8.8 million . For the year ended December 31, 2016 , we did not record any other-than-temporary impairments on our financial assets required to be measured at fair value on a nonrecurring basis. |
Derivatives
Derivatives | 12 Months Ended |
Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | DERIVATIVES From time to time, we enter into interest rate swaps to fix a portion of our interest expense, and foreign exchange forward contracts to offset the earnings impacts of exchange rate fluctuations on certain monetary assets and liabilities. We do not enter into derivative instruments for any purpose other than to manage interest rate or foreign currency exposure. That is, we do not engage in interest rate or currency exchange rate speculation using derivative instruments. As of December 31, 2017 , we had a $48.0 million interest rate swap outstanding with JPMorgan Chase Bank, N.A. This interest rate swap matures on December 31, 2020 and has a fixed rate of 1.42% per annum. The variable rate on the interest rate swap is the one-month LIBOR benchmark. At December 31, 2017 , the one-month LIBOR rate was 1.35% . We typically designate all interest rate swaps as cash flow hedges and, accordingly, record the change in fair value for the effective portion of these interest rate swaps in accumulated other comprehensive income rather than current period earnings until the underlying hedged transaction affects earnings. Gains and losses on the derivative representing hedge ineffectiveness are recognized in current earnings. For the years ended December 31, 2017 and 2016 , there was no ineffectiveness. As of December 31, 2017 , we expect to reclassify a gain of $0.1 million from accumulated other comprehensive loss to earnings within the next twelve months. We may hedge our net recognized foreign currency assets and liabilities with forward foreign exchange contracts to reduce the risk that our earnings and cash flows will be adversely affected by changes in foreign currency exchange rates. These derivative instruments hedge assets and liabilities that are denominated in foreign currencies and are carried at fair value with changes in the fair value recorded as other income. These derivative instruments do not subject us to material balance sheet risk due to exchange rate movements because gains and losses on these derivatives are intended to offset gains and losses on the assets and liabilities being hedged. As of December 31, 2017 , total outstanding contract notional amounts were $22.1 million . At December 31, 2017 , these outstanding balance sheet hedging derivatives had maturities of 90 days or less. The fair value of our derivative instruments was included in our consolidated balance sheets as follows (in thousands): Balance Sheet Classification As of December 31, 2017 2016 Derivative instruments designated as cash flow hedges: Interest rate swap contract Prepaids and other current assets $ 134 $ — Other assets 238 — Accrued liabilities — (38 ) $ 372 $ (38 ) Derivative instruments not designated as cash flow hedges: Foreign currency forward contracts Prepaids and other current assets $ 390 $ — $ 390 $ — The effect of derivative instruments on our consolidated statements of operations was as follows (in thousands): Statement of Operations Classification Year Ended December 31, 2017 2016 2015 Derivative instruments designated as cash flow hedges: Gain (loss) recognized in other comprehensive income before reclassifications --- $ 80 $ (450 ) $ — Loss reclassified from accumulated other comprehensive income to earnings for the effective portion Interest expense (207 ) (626 ) — Income tax benefit Income tax expense 47 200 — Derivative instruments not designated as cash flow hedges: Loss recognized in earnings Other, net $ (382 ) $ — $ — Income tax benefit Income tax expense 86 — — |
Trade Receivables
Trade Receivables | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Trade Receivables | TRADE RECEIVABLES Trade receivables, net, consisted of the following (in thousands): As of December 31, 2017 2016 Trade receivables $ 42,804 $ 45,628 Allowance for doubtful accounts (119 ) (170 ) $ 42,685 $ 45,458 Changes in our allowance for doubtful trade receivables were as follows (in thousands): 2017 2016 2015 Balance, January 1 $ 170 $ 918 $ 108 Charges to bad debt expense 311 289 786 Recoveries (write-offs), net (362 ) (1,037 ) 24 Balance, December 31 $ 119 $ 170 $ 918 |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | INVENTORIES Our inventories consisted of the following (in thousands): As of December 31, 2017 2016 Finished goods $ 48,771 $ 43,130 Parts and components 4,583 3,900 $ 53,354 $ 47,030 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following (in thousands): Estimated Useful Life (in years) As of December 31, 2017 2016 Automobiles 5 to 6 $ 23 $ 139 Leasehold improvements 4 to 20 3,542 3,388 Computer software and equipment 3 to 7 17,024 25,899 Machinery and equipment 3 to 5 15,178 13,085 Furniture and fixtures 5 to 20 2,295 2,238 Work in progress (1) N/A 1,052 768 Total cost 39,114 45,517 Accumulated depreciation (23,287 ) (28,049 ) $ 15,827 $ 17,468 (1) Work in progress primarily includes production tooling and equipment and information technology assets. Depreciation expense was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Depreciation expense $ 5,387 $ 4,320 $ 2,558 |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | GOODWILL The rollforward of goodwill was as follows (in thousands): Direct Retail Total Balance, January 1, 2015 $ 2,520 $ — $ 2,520 Currency exchange rate adjustment (407 ) — (407 ) Business acquisition (Note 2) — 58,357 58,357 Balance, December 31, 2015 2,113 58,357 60,470 Currency exchange rate adjustment 67 3 70 Measurement period adjustments (Note 2) — 1,348 1,348 Balance, December 31, 2016 2,180 59,708 61,888 Currency exchange rate adjustment 155 (13 ) 142 Balance, December 31, 2017 $ 2,335 $ 59,695 $ 62,030 We performed our annual goodwill impairment evaluations during the fourth quarters of 2017 , 2016 , and 2015 . Our 2017 and 2015 evaluations were performed using a qualitative assessment of each reporting unit and determined that it was not more-likely-than-not that the fair value of any reporting unit was less than its carrying amount. Our 2016 test was conducted using a quantitative valuation due to our acquisition of Octane on December 31, 2015 . We determined no impairments of goodwill were indicated in 2017 , 2016 and 2015 |
Other Intangible Assets
Other Intangible Assets | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other Intangible Assets | OTHER INTANGIBLE ASSETS Other intangible assets consisted of the following (in thousands): Estimated Useful Life (in years) As of December 31, 2017 2016 Indefinite-lived trademarks (1) N/A $ 23,252 $ 32,052 Definite-lived trademarks 10 to 15 2,600 2,600 Patents 8 to 24 15,187 31,487 Customer relationships 10 to 15 24,700 24,700 65,739 90,839 Accumulated amortization - definite-lived intangible assets (7,996 ) (21,039 ) $ 57,743 $ 69,800 (1) During the fourth quarter of 2017 , we identified impairment indicators in our Octane Fitness brand name originally acquired through the Octane Fitness acquisition on December 31, 2015 . Ongoing weakness in the specialty retail channel, as a result of retailer consolidation, has had a negative impact on Octane branded sales and projected growth trends. We utilized the relief-from-royalty method to quantify the impairment, resulting in an $8.8 million non-cash impairment charge for 2017 . Amortization expense was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Amortization expense $ 3,256 $ 3,554 $ 854 Future amortization of definite-lived intangible assets is as follows (in thousands): 2018 $ 3,164 2019 3,134 2020 3,108 2021 3,078 2022 3,078 Thereafter 18,929 $ 34,491 |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | ACCRUED LIABILITIES Accrued liabilities consisted of the following (in thousands): As of December 31, 2017 2016 Payroll and related liabilities $ 3,659 $ 4,579 Other 7,105 8,313 Total accrued liabilities $ 10,764 $ 12,892 |
Product Warranties
Product Warranties | 12 Months Ended |
Dec. 31, 2017 | |
Product Warranties Disclosures [Abstract] | |
Product Warranties | PRODUCT WARRANTIES Changes in our product warranty obligations were as follows (in thousands): 2017 2016 2015 Balance, January 1 $ 7,450 $ 8,545 $ 2,246 Accruals 3,008 2,480 2,302 Payments (4,341 ) (3,575 ) (1,553 ) Business acquisition (Note 2) — — 5,550 Balance, December 31 $ 6,117 $ 7,450 $ 8,545 |
Borrowings
Borrowings | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Borrowings | BORROWINGS Term Loan and Line of Credit On December 31, 2015 we entered into an amendment (the “Amendment”) to our existing Credit Agreement, dated December 5, 2014, with JPMorgan Chase Bank, N.A. (“Chase Bank”) that provided for an $80 million term loan to finance the acquisition described in Note 2, Business Acquisition , above (the “Term Loan”). The Term Loan and our existing $20 million revolving line of credit with Chase Bank are secured by substantially all of the assets of Nautilus. The Term Loan matures on December 31, 2020. The Amendment also extended the maturity date of our existing revolving line of credit to December 31, 2020. The Credit Agreement, as amended, contains customary covenants, including minimum fixed charge coverage ratio and funded debt to EBITDA ratio, and limitations on capital expenditures, mergers and acquisitions, indebtedness, liens, dispositions, dividends and investments. The Credit Agreement also contains customary events of default. Upon an event of default, the lender may terminate its credit line commitment, accelerate all outstanding obligations and exercise its remedies under the continuing security agreement. Borrowing availability under the Credit Agreement is subject to our compliance with certain financial and operating covenants at the time borrowings are requested. Letters of credit under the Credit Agreement are treated as a reduction of the available borrowing amount and are subject to covenant testing. The interest rate applicable to the Term Loan and to each advance under the revolving line of credit is based on either Chase Bank's floating prime rate or adjusted LIBOR, plus an applicable margin. As of December 31, 2017 , our borrowing rate for the Term Loan and line of credit advances was 2.35% . As of December 31, 2017 , we had outstanding borrowings of $48.0 million on our term loan and no letters of credit issued under the Credit Agreement. As of December 31, 2017 , we were in compliance with the financial covenants of the Credit Agreement, and $20.0 million was available for borrowing under the line of credit. Principal maturities of our Term Loan over the next five years are as follows (in thousands): 2018 $ 16,000 2019 16,000 2020 16,000 $ 48,000 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES Income Tax Expense Income from continuing operations before income taxes was as follows (in thousands): Year Ended December 31, 2017 2016 2015 U.S. $ 34,259 $ 50,651 $ 39,242 Non-U.S. 1,446 930 780 $ 35,705 $ 51,581 $ 40,022 Income tax expense (benefit) from continuing operations was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Current: U.S. federal $ 14,409 $ 6,765 $ 858 U.S. state 1,887 318 171 Non-U.S. 330 118 355 Total current 16,626 7,201 1,384 Deferred: U.S. federal (9,418 ) 8,130 11,324 U.S. state 819 1,037 573 Non-U.S. 53 112 (62 ) Total deferred (8,546 ) 9,279 11,835 $ 8,080 $ 16,480 $ 13,219 Following is a reconciliation of the U.S. statutory federal income tax rate with our effective income tax rate for continuing operations: Year Ended December 31, 2017 2016 2015 U.S. statutory income tax rate 35.0 % 35.0 % 35.0 % State tax, net of U.S. federal tax benefit 5.0 2.4 2.6 Non-U.S. income taxes (0.1 ) 0.3 (0.1 ) Nondeductible operating expenses 0.8 0.3 0.8 Research and development credit (1.5 ) (1.0 ) (0.6 ) Change in deferred tax measurement rate (1) (15.3 ) (0.1 ) — Change in uncertain tax positions 0.8 (5.1 ) 1.1 Excess tax benefits from stock plans (2.1 ) — — Change in valuation allowance 0.1 0.2 (5.8 ) Other (0.1 ) (0.1 ) — Effective income tax rate 22.6 % 31.9 % 33.0 % (1) Effective income tax rate for 2017 includes impacts related to the Tax Cuts and Jobs Act (the “TCJ Act”). Deferred Income Taxes Individually significant components of deferred income tax assets and liabilities were as follows (in thousands): As of December 31, 2017 2016 Deferred income tax assets: Accrued liabilities $ 3,000 $ 5,089 Allowance for doubtful accounts 12 40 Inventory valuation 254 199 Capitalized indirect inventory costs 383 497 Stock-based compensation expense 897 1,346 Deferred rent 588 865 Accrued royalty — 429 Net operating loss carryforward 1,715 2,377 Basis difference on long-lived assets 548 1,052 Credit carryforward 634 615 Other 179 140 Gross deferred income tax assets 8,210 12,649 Valuation allowance (914 ) (886 ) Deferred income tax assets, net of valuation allowance 7,296 11,763 Deferred income tax liabilities: Prepaid advertising (370 ) (1,302 ) Other prepaids (610 ) (744 ) Basis difference of long-lived assets (14,856 ) (26,215 ) Undistributed earnings of foreign subsidiaries — (457 ) Other (18 ) (25 ) Deferred income tax liabilities (15,854 ) (28,743 ) Net deferred income tax liabilities $ (8,558 ) $ (16,980 ) Our net deferred income tax assets (liabilities) were recorded on our consolidated balance sheets as follows (in thousands): As of December 31, 2017 2016 Deferred income tax assets, non-current — 11 Deferred income tax liabilities, non-current (8,558 ) (16,991 ) Net deferred income tax liabilities $ (8,558 ) $ (16,980 ) On December 22, 2017 , the TCJ Act was enacted into law. The TCJ Act provides for significant changes to the U.S. Internal Revenue Code of 1986 that impact corporate taxation requirements, such as the reduction of the federal tax rate for corporations from 35% to 21% , changes or limitations to certain tax deductions, implementing the territorial tax system and imposing a repatriation tax on deemed repatriated earnings of foreign subsidiaries. We made an effort to reasonably estimate the impact of the TCJ Act, however, due to the complexities and the timing of the enactment, our accounting under ASC 740 for certain income tax effects of the TCJ Act is provisional as of December 31, 2017 . We reported, as provisional amounts, the specific effect of those items for which the accounting is not complete but for which we determined a reasonable estimate. These provisional amounts are subject to adjustment during a “measurement period” until the accounting under ASC 740 is complete. Further, on December 22, 2017 , Staff Accounting Bulletin No. 118 ("SAB 118") was issued to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed in reasonable detail to complete the accounting for certain income tax effects of the TCJ Act. In accordance with SAB 118, we have calculated and recorded a $5.6 million income tax benefit in the fourth quarter of 2017 related to the remeasurement of certain deferred tax assets and liabilities. Additional work is necessary for a more detailed analysis of our deferred tax assets and liabilities. Any subsequent adjustment to these amounts will be recorded to current tax expense in the quarter of 2018 when the analysis is complete. We account for income taxes based on the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities. We have recorded a valuation allowance to reduce our deferred income tax assets to the amount we believe is more likely than not to be realized. Evaluating the need for, and amount of, a valuation allowance for deferred tax assets often requires significant judgment and extensive analysis of all available evidence on a jurisdiction-by-jurisdiction basis. Such judgments require us to interpret existing tax law and other published guidance as applied to our circumstances. As part of this assessment, we consider both positive and negative evidence. The weight given to the potential effect of positive and negative evidence must be commensurate with the extent to which the strength of the evidence can be objectively verified. As of December 31, 2017 , we had a valuation allowance against net deferred income tax assets of $0.9 million . Of the remaining valuation allowance, $0.7 million primarily relates to domestic state tax credit carryforwards as we currently do not anticipate generating income of appropriate character to utilize those credits. The remainder of $0.2 million relates to foreign net operating loss carryforwards. Should it be determined in the future that it is more likely than not that our domestic deferred income tax assets will be realized, an additional valuation allowance would be released during the period in which such an assessment is made. There have been no material changes to our foreign operations since December 31, 2016 , and, accordingly, we maintain our existing valuation allowance on foreign deferred income tax assets in such jurisdictions at December 31, 2017 . Income Tax Carryforwards As of December 31, 2017 , we had the following income tax carryforwards (in millions): Amount Expires in Net operating loss carryforwards U.S. state $ 32.0 2018 - 2035 China $ 0.8 2020 - 2022 Income tax credit carryforwards U.S. state $ 0.9 2018 - 2031 The timing and manner in which we are permitted to utilize our net operating loss carryforwards may be limited by Internal Revenue Code Section 382, Limitation on Net Operating Loss Carry-forwards and Certain Built-in-Losses Following Ownership Change . Unrecognized Tax Benefits Following is a reconciliation of gross unrecognized tax benefits from uncertain tax positions, excluding the impact of penalties and interest (in thousands): Year Ended December 31, 2017 2016 2015 Balance, January 1 $ 1,970 $ 2,519 $ 2,768 Additions for tax positions taken in prior years 38 21 1 Reductions for tax positions taken in prior years (5 ) (523 ) (426 ) Additions for tax positions related to the current year 211 83 43 Lapses of statutes of limitations (11 ) (130 ) — Other (9 ) — 133 Balance, December 31 $ 2,194 $ 1,970 $ 2,519 Of the $2.2 million of gross unrecognized tax benefits from uncertain tax positions outstanding as of December 31, 2017 , $2.0 million would affect our effective tax rate if recognized. We recorded tax-related interest and penalty expense (benefit) of $0.3 million , $(1.9) million and $0.5 million in 2017 , 2016 and 2015 , respectively. We had a cumulative liability for interest and penalties related to uncertain tax positions as of December 31, 2017 and 2016 of $1.0 million and $0.7 million , respectively. Our U.S. federal income tax returns for 2009 through 2017 are open to review by the U.S. Internal Revenue Service. Our state income tax returns for 2007 through 2017 are open to review, depending on the respective statute of limitation in each state. In addition, we file income tax returns in several non-U.S. jurisdictions with varying statutes of limitation. As of December 31, 2017 , we believe it is reasonably likely that, within the next 12 months, $0.8 million |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Accumulated other comprehensive income (loss), net of applicable taxes, reported on our consolidated balance sheets consists of unrealized holding gains and losses on available-for-sale securities, effective portions of gains and losses of derivative securities designated as cash flow hedges, and foreign currency translation adjustments. The following table sets forth the changes in accumulated other comprehensive income (loss), net of tax (in thousands) for the periods presented: Unrealized Gain (Loss) on Available-for-Sale Securities Gain (loss) on Derivative Securities Foreign Currency Translation Adjustments Accumulated Other Comprehensive Income (Loss) Balance, January 1, 2015 $ (18 ) $ — $ (290 ) $ (308 ) Current period other comprehensive income (loss) 2 — (1,021 ) (1,019 ) Balance, December 31, 2015 (16 ) — (1,311 ) (1,327 ) Current period other comprehensive income (loss) before reclassifications 8 (450 ) 126 (316 ) Reclassification of amounts to earnings — 426 — 426 Net other comprehensive income (loss) during period 8 (24 ) 126 110 Balance, December 31, 2016 (8 ) (24 ) (1,185 ) (1,217 ) Current period other comprehensive income (loss) before reclassifications (56 ) 80 774 798 Reclassification of amounts to earnings — 160 — 160 Net other comprehensive income (loss) during period (56 ) 240 774 958 Balance, December 31, 2017 $ (64 ) $ 216 $ (411 ) $ (259 ) |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Stock-Based Compensation | STOCK-BASED COMPENSATION 2015 Long-Term Incentive Plan On April 28, 2015, Nautilus shareholders approved our 2015 Long-Term Incentive Plan (the “2015 Plan”), which replaced our 2005 Long-Term Incentive Plan that expired in 2015. The 2015 Plan is administered by the Compensation Committee of the Board of Directors and authorizes us to grant various types of stock-based awards including: stock options, stock appreciation rights, RSAs, RSUs, and PSUs. Stock options granted under the 2015 Plan shall not have an exercise price less than the fair market value of our common stock on the date of the grant. The exercise price of a stock option or stock appreciation right may not be reduced without shareholder approval. Stock options generally vest over periods of three or four years of continuous service, commencing on the date of grant. Stock options granted under the 2015 Plan have a seven -year contractual term. Upon adoption, there were approximately 4.8 million shares available for issuance under the 2015 Plan. The number of shares available for issuance upon adoption of the 2015 Plan included new shares approved, plus any shares of common stock which were previously reserved for issuance under our preceding plan and were not subject to grant as of April 28, 2015, or as to which the stock-based compensation award is forfeited on or after April 28, 2015. The number of shares available for issuance is reduced by (i) two shares for each share delivered in settlement of any stock appreciation rights, RSA, RSU or PSU awards, and (ii) one share for each share delivered in settlement of a stock option award. In no event shall more than 1.0 million aggregate shares of common stock subject to stock options, stock appreciation rights, RSA, RSU or PSU awards be granted to any one participant in any one year under the 2015 Plan. At December 31, 2017 , we had 4.2 million shares available for future grant under our 2015 Plan, and a total of 4.9 million shares of our common stock are reserved for future issuance pursuant to awards currently outstanding under the 2015 Plan and our previous plan combined. Stock Option Activity Stock option activity was as follows (shares in thousands): Options Outstanding Weighted- Average Exercise Price Outstanding at December 31, 2016 433 $ 5.03 Forfeited, canceled or expired (1 ) 15.58 Exercised (135 ) 4.15 Outstanding at December 31, 2017 297 $ 5.37 Certain information regarding options outstanding at December 31, 2017 was as follows: Options Outstanding Options Exercisable Options Vested and Expected to Vest Number (in thousands) 297 291 297 Weighted-average exercise price $ 5.37 $ 5.19 $ 5.37 Aggregate intrinsic value (in thousands) $ 2,405 $ 2,401 $ 2,405 Weighted average remaining contractual term (in years) 2.1 2.0 2.1 RSA Activity Compensation expense for RSAs is recognized over the estimated vesting period. Following is a summary of RSA activity (shares in thousands): RSAs Outstanding Weighted- Average Grant Date Fair Value per Share Outstanding at December 31, 2016 44 $ 16.31 Granted 17 17.60 Vested (14 ) 17.91 Outstanding at December 31, 2017 47 $ 16.28 RSU Activity Compensation expense for RSUs is recognized over the estimated vesting period. Following is a summary of RSU activity (shares in thousands): RSUs Outstanding Weighted- Average Grant Date Fair Value per Share Outstanding at December 31, 2016 109 $ 18.17 Granted 108 16.94 Forfeited, canceled or expired (24 ) 17.78 Vested (2 ) 19.07 Outstanding at December 31, 2017 191 $ 17.64 PSU Activity Compensation expense for PSUs is recognized over the estimated requisite service period based on the number of PSUs ultimately expected to vest. In February 2014 , we granted PSU awards to certain of our executive officers covering a total of 82,494 shares of our common stock. The PSUs vested in 2017 based on achievement of goals established for operating income and revenue growth for the three-year performance period ended 2016 . These awards vested in full in 2017 at the 150% maximum achievement for a total of 123,739 shares. In April and September 2015, we granted PSU awards to certain of our executive officers and management team covering a total of 56,820 shares of our common stock. The PSUs vest based on achievement of goals established for certain operating income and return on asset criteria for a three-year performance period. The number of shares vesting under the PSU awards following conclusion of the performance period will be determined based on the level at which the financial goals are achieved. The number of shares vesting can range from 60% of the PSU awards if minimum thresholds are achieved to a maximum of 150% . These awards are expected to vest at approximately 115% achievement, net of any forfeitures. As of December 31, 2017 , approximately 44,900 PSU shares remained, net of actual forfeitures to date. In December 2015, we granted PSU awards to a certain executive officer and management team personnel covering a total of 117,230 shares of our common stock. The PSUs vest based on achievement of certain operating income and operating margin goals for a three-year performance period. The number of shares vesting under the PSU awards following conclusion of the performance period will be determined based on the level at which the financial goals are achieved. As of December 31, 2017 , approximately 13,600 PSU shares remained, net of actual forfeitures to date. These awards were authorized for replacement by our Board of Directors during 2017 and will be processed in 2018 . In February 2016, we granted PSU awards to certain of our executive officers and management team covering a total of 54,818 shares of our common stock. The PSUs vest based on achievement of goals established for growth in operating income as a percentage of net revenue and return on invested capital over a three-year performance period. The number of shares that ultimately vest following conclusion of the performance period will be determined based on the level at which the financial goals are achieved. The number of shares vesting can range from 60% of the PSU awards if minimum thresholds are achieved to a maximum of 150% . As of December 31, 2017 , approximately 48,600 PSU shares remained, net of actual forfeitures to date. In February 2017, we granted PSU awards to certain of our executive officers and management team covering a total of 72,017 shares of our common stock. The PSUs vest based on achievement of goals established for growth in operating income as a percentage of net revenue and return on invested capital over a three-year performance period. The number of shares that ultimately vest following conclusion of the performance period will be determined based on the level at which the financial goals are achieved. The number of shares vesting can range from 60% of the PSU awards if minimum thresholds are achieved to a maximum of 150% . As of December 31, 2017 , approximately 65,100 PSU shares remained, net of actual forfeitures to date. Following is a summary of PSU activity (shares in thousands): PSUs Outstanding Weighted- Average Grant Date Fair Value per Share Outstanding at December 31, 2016 264 $ 14.66 Granted and additional goal shares awarded 113 13.84 Forfeited, canceled or expired (81 ) 16.99 Vested (124 ) 8.23 Outstanding at December 31, 2017 172 $ 17.65 Stock-Based Compensation Stock-based compensation expense, primarily included in general and administrative expense, was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Stock options $ 84 $ 389 $ 327 RSAs 287 168 — RSUs 954 734 544 PSUs 408 1,211 575 ESPP 123 111 38 $ 1,856 $ 2,613 $ 1,484 Certain other information regarding our stock-based compensation was as follows (in thousands, except per share amounts): Year Ended December 31, 2017 2016 2015 Weighted average grant-date per share fair value of stock options granted $ — $ — $ 8.94 Total intrinsic value of stock options exercised 1,522 1,221 4,142 Fair value of RSUs vested 28 311 673 Fair value of PSUs vested 2,036 574 1,454 As of December 31, 2017 , unrecognized compensation expense for outstanding, but unvested stock-based awards was $2.6 million , which is expected to be recognized over a weighted average period of 0.4 to 1.3 years. Employee Stock Purchase Plan On April 28, 2015, our shareholders approved our Employee Stock Purchase Plan (the “ESPP”). The ESPP is administered by the Compensation Committee of the Board of Directors and provides eligible employees with an opportunity to purchase shares of our common stock at a discount using payroll deductions. The ESPP authorizes the issuance of up to 0.5 million shares of our common stock, subject to adjustment as provided in the ESPP for stock splits, stock dividends, recapitalizations and other similar events. Pursuant to the ESPP, and subject to certain limitations specified therein, eligible employees may elect to purchase shares of our common stock in one or more of a series of offerings conducted pursuant to the procedures set forth in the ESPP at a purchase price equal to 90% of the lower of the fair market value of the common stock on the first trading day of the offering period or on the last day of the offering period. Offering periods commence on May 15 and November 15 of each year and are six-months in duration, with the exception of the first offering period in 2015, which was a four-month offering. Purchases under the ESPP may be made exclusively through payroll deductions. Persons eligible to participate in the ESPP generally include employees who have been employed for at least 12 months prior to the applicable offering date and who, immediately upon purchasing shares under the ESPP, would own directly or indirectly, an aggregate of less than 5% of the total combined voting power or value of all outstanding shares of our common stock. ESPP activity was as follows (shares in thousands): Shares Available for Issuance Weighted- Weighted-Average Discount per Share Balance at December 31, 2016 469 Employee shares purchased (37 ) $ 13.20 $ 2.19 Balance at December 31, 2017 432 Assumptions used in calculating the fair value of stock option grants and employee stock purchases were as follows: Year Ended December 31, 2017 2016 2015 ESPP ESPP ESPP Options Dividend yield —% —% —% —% Risk-free interest rate 0.8% 0.4% 0.1% 1.6% Expected life (years) N/A N/A N/A 4.28 Expected volatility 44% 56% 43% 71% Dividend yield is based on our current expectation that no dividend payments will be made in future periods. Risk-free interest rate is the U.S. Treasury zero-coupon rate, as of the grant date, for issues having a term approximately equal to the expected life of the stock option. For the ESPP, it is the U.S. Treasury six-month constant maturities rate, as of the offering date. Expected life is the period of time over which stock options are expected to remain outstanding. We calculate expected term based on the average of the sum of the vesting periods and the full contractual term. Expected volatility |
Stock Repurchase Program Stock
Stock Repurchase Program Stock Repurchase Program | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Stock Repurchase Program | STOCK REPURCHASE PROGRAM On November 3, 2014 , our Board of Directors authorized a stock repurchase program that authorized us to repurchase up to $15.0 million of our outstanding common stock from time to time during the ensuing period of 24 months. As of November 2016 , the stock repurchases under this program were completed in full and the program expired. On May 4, 2016 , our Board of Directors authorized the repurchase of up to $10.0 million of our outstanding common stock from time to time through May 4, 2018 . During 2017 , repurchases under this program totaled $8.1 million . As of November 2017 , the stock repurchases under this program were completed in full and the program expired. On April 25, 2017 , our Board of Directors authorized a $15.0 million share repurchase program. Under this program, shares of common stock may be repurchased from time to time through April 25, 2019 . Repurchases may be made in open market transactions at prevailing market prices, in privately negotiated transactions, or by other means in accordance with federal securities laws. Share repurchases are funded with existing cash balances, and the repurchased shares are retired and returned to unissued authorized shares. As of December 31, 2017 , repurchases under this program totaled $3.0 million . As of December 31, 2017 , there was $12.0 million remaining available for share repurchases pursuant to the 2017 program. Repurchases for 2015 through 2017 for all programs were as follows: Year Ended Number of Shares Repurchased Amount Average Price per Share December 31, 2015 711,708 $11,567,527 $16.25 December 31, 2016 319,805 5,390,355 16.86 December 31, 2017 788,416 11,054,983 14.02 Totals to Date 1,819,929 $28,012,865 $15.39 |
Income Per Share
Income Per Share | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Income Per Share | INCOME PER SHARE The weighted average numbers of shares outstanding used to compute income per share amounts were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Shares used for basic per share calculations 30,671 31,032 31,288 Dilutive effect of outstanding options, RSUs, and PSUs 339 269 301 Shares used for diluted per share calculations 31,010 31,301 31,589 The weighted average numbers of shares outstanding listed in the table below were anti-dilutive and excluded from the computation of diluted income per share, primarily because the average market price did not exceed the exercise price. These shares may be dilutive potential common shares in the future (in thousands): As of December 31, 2017 2016 2015 Stock options 8 8 12 |
401(k) Savings Plan 401(k) Savi
401(k) Savings Plan 401(k) Savings Plan | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
401(k) Savings Plan | 401(k) SAVINGS PLAN We sponsor a 401(k) savings plan that allows eligible employees to contribute a certain percentage of their salary. Employees are automatically enrolled within the first month of employment and have the ability to opt out. As a safe harbor plan sponsor, we are subject to non-discretionary matching contributions. Currently, we match 100% of the employee's first 1% of eligible pay contributed plus 50% of eligible pay contributed on the next 5% , for a maximum employer matching of 3.5% . Employees vest in the employer matching portions at 25% after the first year of employment, and 100% after two years of employment. Our matching contributions for the savings plan were as follows (in thousands): Year ended December 31, 2017 2016 2015 401(k) matching contributions $ 1,056 $ 1,014 $ 746 |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT AND ENTERPRISE-WIDE INFORMATION In accordance with FASB ASC 280, Segment Reporting , we determined that we have two operating segments - Direct and Retail. There have been no changes in our operating segments during the year ended December 31, 2017 . We evaluate performance using several factors, of which the primary financial measures are net sales and reportable segment contribution. Contribution is the measure of profit or loss, defined as net sales less product costs and directly attributable expenses. Directly attributable expenses include selling and marketing expenses, general and administrative expenses, and research and development expenses that are directly related to segment operations. Segment assets are those directly assigned to an operating segment's operations, primarily accounts receivable, inventories, goodwill and other intangible assets. Unallocated assets primarily include cash and cash equivalents, available-for-sale securities, derivative securities, shared information technology infrastructure, distribution centers, corporate headquarters, prepaids and other current assets, deferred income tax assets and other assets. Capital expenditures directly attributable to the Direct and Retail segments were not significant in any period. Following is summary information by reportable segment (in thousands): Year Ended December 31, 2017 2016 2015 Net Sales: Direct $ 219,440 $ 225,057 $ 225,595 Retail 183,875 177,920 106,195 Unallocated royalty 2,869 3,062 3,974 Consolidated net sales $ 406,184 $ 406,039 $ 335,764 Contribution: Direct $ 34,900 $ 43,215 $ 39,940 Retail 27,495 29,451 12,850 Unallocated royalty 2,852 3,018 3,974 Consolidated contribution $ 65,247 $ 75,684 $ 56,764 Reconciliation of consolidated contribution to income from continuing operations: Consolidated contribution $ 65,247 $ 75,684 $ 56,764 Amounts not directly related to segments: Operating expenses (28,944 ) (22,290 ) (16,493 ) Other expense, net (598 ) (1,813 ) (249 ) Income tax expense 8,080 16,480 13,219 Income from continuing operations $ 27,625 $ 35,101 $ 26,803 Depreciation and amortization expense: Direct $ 1,666 $ 1,944 $ 868 Retail 4,606 4,775 757 Unallocated corporate 2,371 1,155 1,787 Total depreciation and amortization expense $ 8,643 $ 7,874 $ 3,412 As of December 31, Assets: 2017 2016 Direct $ 40,532 $ 37,388 Retail 192,064 206,580 Unallocated corporate 92,180 89,098 Total assets $ 324,776 $ 333,066 Net sales by geographic area were as follows: Year Ended December 31, 2017 2016 2015 U.S. $ 352,703 $ 353,893 $ 295,366 Canada 25,589 26,005 33,230 All other 27,892 26,141 7,168 $ 406,184 $ 406,039 $ 335,764 There are no material long-lived assets held outside of the U.S. In 2017 , 2016 and 2015 , Amazon.com accounted for 11.9% , 11.3% and 11.1% |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Operating Leases We lease property and equipment under non-cancellable operating leases which, in the aggregate, extend through 2025. Many of these leases contain renewal options and provide for rent escalations and payment of real estate taxes, maintenance, insurance and certain other operating expenses of the properties. Rent expense under all operating leases was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Rent expense $ 6,095 $ 6,561 $ 5,033 As of December 31, 2017 , future minimum lease payments under non-cancellable leases, reduced for sublease income, were as follows (in thousands): 2018 $ 5,016 2019 5,035 2020 4,983 2021 4,021 2022 2,703 Thereafter 4,353 $ 26,111 Guarantees, Commitments and Off-Balance Sheet Arrangements We have long lead times for inventory purchases and, therefore, must secure factory capacity from our vendors in advance. As of December 31, 2017 , we had approximately $19.0 million in non-cancelable market-based purchase obligations, primarily for inventory purchases expected to be received within the next twelve months. Purchase obligations can vary from quarter-to-quarter and versus the same period in prior years due to a number of factors, including the amount of products that are shipped directly to Retail customer warehouses versus through Nautilus warehouses. As of December 31, 2017 , we had no outstanding letters of credit with any of our vendors. In the ordinary course of business, we enter into agreements that require us to indemnify counterparties against third-party claims. These may include: agreements with vendors and suppliers, under which we may indemnify them against claims arising from use of their products or services; agreements with customers, under which we may indemnify them against claims arising from their use or sale of our products; real estate and equipment leases, under which we may indemnify lessors against third-party claims relating to the use of their property; agreements with licensees or licensors, under which we may indemnify the licensee or licensor against claims arising from their use of our intellectual property or our use of their intellectual property; and agreements with parties to debt arrangements, under which we may indemnify them against claims relating to their participation in the transactions. The nature and terms of these indemnification obligations vary from contract to contract, and generally a maximum obligation is not stated within the agreements. We hold insurance policies that mitigate potential losses arising from certain types of indemnification obligations. Management does not deem these obligations to be significant to our financial position, results of operations or cash flows and, therefore, no related liabilities were recorded as of December 31, 2017 . Legal Matters From time to time, in the ordinary course of business, we may be involved in various claims, lawsuits and other proceedings. These legal and tax proceedings involve uncertainty as to the eventual outcomes and losses which may be realized when one or more future events occur or fail to occur. Litigation and jury verdicts are, to some degree, inherently unpredictable, and although we have determined that a loss is not probable in connection with any current legal proceeding, it is reasonably possible that a loss may be incurred in connection with proceedings to which we are a party. Assessment of whether incurrence of a loss is probable, or a reasonable possibility, in connection with a particular proceeding, and estimation of the loss, or a range of loss, involves complex judgments and numerous uncertainties. Management is unable to estimate a range of reasonably possible losses related to litigation in which the damages sought are indeterminate, or the legal and factual basis for the relevant claims have not been developed with specificity. As such, zero liability is recorded as of December 31, 2017 . We regularly monitor our estimated exposure to these contingencies and, as additional information becomes known, may change our estimates accordingly. We evaluate, on a quarterly basis, developments in legal proceedings, investigations or claims that could affect the amount of any accrual, as well as any developments that would make a loss probable or reasonably possible, and whether the amount of a probable or reasonably possible loss is estimable. Among other factors, we evaluate the advice of internal and external counsel, the outcomes from similar litigation, current status of the lawsuits (including settlement initiatives), legislative developments and other factors. Due to the numerous variables associated with these judgments and assumptions, both the precision and reliability of the resulting estimates of the related loss contingencies are subject to substantial uncertainties. |
Supplementary Information - Qua
Supplementary Information - Quarterly Results of Operations (unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Supplementary Information - Quarterly Results of Operations Unaudited | SUPPLEMENTARY INFORMATION - QUARTERLY RESULTS OF OPERATIONS (unaudited) The following table summarizes our unaudited quarterly financial data for 2017 and 2016 (in thousands, except per share amounts): Quarter Ended March 31 June 30 September 30 December 31 Total 2017 Net sales $ 113,252 $ 77,029 $ 88,132 $ 127,771 $ 406,184 Gross profit 61,745 38,378 41,315 62,444 203,882 Operating income (1) 12,683 3,849 13,365 6,406 36,303 Income from continuing operations (2) 8,185 2,566 8,342 8,532 27,625 Loss from discontinued operations (3) (1,092 ) (77 ) (101 ) (88 ) (1,358 ) Net income 7,093 2,489 8,241 8,444 26,267 Net income per share: Basic $ 0.23 $ 0.08 $ 0.27 $ 0.28 $ 0.86 Diluted 0.23 0.08 0.27 0.27 0.85 2016 Net sales $ 120,928 $ 78,529 $ 80,818 $ 125,764 $ 406,039 Gross profit 66,344 41,862 39,217 64,102 211,525 Operating income 19,300 6,573 8,211 19,310 53,394 Income from continuing operations (4) 11,586 3,696 7,845 11,974 35,101 Loss from discontinued operations (142 ) (166 ) (251 ) (364 ) (923 ) Net income 11,444 3,530 7,594 11,610 34,178 Net income per share: Basic $ 0.37 $ 0.11 $ 0.24 $ 0.38 $ 1.10 Diluted 0.37 0.11 0.24 0.37 1.09 (1) Operating income for the quarter ended December 31, 2017 included an $8.8 million non-cash asset impairment charge related to the Octane Fitness brand name. (2) Income from continuing operations for the quarter ended December 31, 2017 included a non-recurring tax benefit of $5.6 million related to the change in U.S. tax law that resulted in the reassessment of certain deferred tax assets and liabilities. (3) Loss from discontinued operations for the quarter ended March 31, 2017 included a $1.2 million expense related to a lawsuit settlement with Biosig Instruments, Inc. (4) Income from continuing operations for the quarter ended September 30, 2016 included a non-recurring tax benefit of $2.7 million |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Event | SUBSEQUENT EVENT On February 21, 2018 , our Board of Directors authorized an additional $15.0 million share repurchase program. Under the new program, shares of our common stock may be repurchased from time to time through February 21, 2020 . Repurchases may be made in open market transactions at prevailing prices, in privately negotiated transactions, or by other means in accordance with federal securities laws. Share repurchases will be funded from existing cash balances, and repurchased shares will be retired and returned to unissued authorized shares. To date, we have not repurchased any shares under the new $15.0 million |
Significant Accounting Polici33
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of PresentationThe accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and relate to Nautilus, Inc. and its subsidiaries, all of which are wholly-owned, directly or indirectly. Intercompany transactions and balances have been eliminated in consolidation. |
Discontinued Operation | Discontinued Operations Results from discontinued operations relate to the disposal of our former Commercial business, which was completed in April 2011. We reached substantial completion of asset liquidation at December 31, 2012. Although there was no revenue related to our former Commercial business during 2015 through 2017 , we continue to have product liability and other legal expenses associated with product previously sold into the Commercial channel. |
Critical Accounting Estimates | Critical Accounting 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 in the financial statements. Our critical accounting estimates relate to the following: • Sales discounts and allowances; • Goodwill and other long-term assets valuation; • Product warranty obligations; and • Unrecognized tax benefits. Actual results could differ from our estimates. |
Concentrations | Concentrations Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents held in bank accounts in excess of federally-insured limits and trade receivables. Trade receivables are generally unsecured and therefore collection is affected by the economic conditions in each of our principal markets. We rely on third-party contract manufacturers in Asia for substantially all of our products and for certain product engineering support. Business operations could be disrupted by natural disasters, difficulties in transporting products from non-U.S. suppliers, as well as political, social or economic instability in the countries where contract manufacturers or their vendors or customers conduct business. While any such contract manufacturing arrangement could be replaced over time, the temporary loss of the services of any primary contract manufacturer could delay product shipments and cause a significant disruption in our operations. |
Cash and Cash Equivalents | Cash and Cash Equivalents All highly liquid investments with original maturities of three months or less at purchase are considered to be cash equivalents. |
Available-For-Sale Securities | Available-For-Sale Securities We classify our marketable securities as available-for-sale and, accordingly, record them at fair value. Marketable securities with original maturities of greater than three months and remaining maturities of less than one year are classified as short-term investments. Investments with maturities beyond one year may be classified as short-term based on their highly liquid nature and because such marketable securities represent the investment of cash that is available for current operations. Unrealized holding gains and losses, which are immaterial, are excluded from earnings and are reported net of tax in other comprehensive income until realized. Dividend and interest income is recognized when earned. Realized gains and losses, which were not material in 2017 or 2016 , are included in earnings and are derived using the specific identification method for determining the cost of securities sold. We periodically evaluate whether declines in fair values of our investments below their cost are "other-than-temporary." This evaluation consists of qualitative and quantitative factors regarding the severity and duration of the unrealized loss, as well as our ability and intent to hold the investment until a forecasted recovery occurs. For additional information, refer to Note 4, Fair Value Measurements |
Derivative Securities | Derivative Securities We record our derivative securities at fair value, and our portfolio currently consists of an interest rate swap contract and foreign currency forward contracts. The fair value of our interest rate swap agreement, which is classified as a cash flow hedge, represents the estimated receipts or payments that would be made to terminate the agreement. The amounts related to the cash flow hedge are recorded as deferred gains or losses in our consolidated balance sheets with the offset recorded in accumulated other comprehensive loss, net of tax. We enter into foreign exchange forward contracts to offset the earnings impacts of exchange rate fluctuations on certain monetary assets and liabilities. A hypothetical 10% increase in interest rates, or a 10% movement in the currencies underlying our foreign currency derivative positions, would not have material impacts on our results of operations, financial position or cash flows. Gains and losses on foreign currency forward contracts are recognized in the Other, net line of our consolidated statements of operations. |
Trade Receivables | Trade ReceivablesAccounts receivable primarily consists of trade receivables due from our Retail segment customers. We determine an allowance for doubtful accounts based on historical customer experience and other currently available evidence. When a specific account is deemed uncollectible, the account is written off against the allowance. |
Inventories | Inventories Inventories are stated at the lower of cost and net realizable value ("NRV"), with cost determined based on the first-in, first-out method. We establish inventory allowances for excess, slow-moving and obsolete inventory based on inventory levels, expected product life and forecasted sales. Inventories are written down to NRV based on historical demand, competitive factors, changes in technology and product lifecycles. |
Property, plant and equipment | Property, Plant and Equipment Property, plant and equipment is stated at cost, net of accumulated depreciation. Improvements or betterments which add new functionality or significantly extend the life of an asset are capitalized. Expenditures for maintenance and repairs are expensed as incurred. The cost of assets retired, or otherwise disposed of, and the related accumulated depreciation, are removed from the accounts at the time of disposal. Gains and losses resulting from asset sales and dispositions are recognized in the period in which assets are disposed. Depreciation is recognized, using the straight-line method, over the lesser of the estimated useful lives of the assets or, in the case of leasehold improvements, the lease term, including renewal periods if we expect to exercise our renewal options. Depreciation on automobiles, computer software and equipment, machinery and equipment, and furniture and fixtures is determined based on estimated useful lives, which generally range from three -to- seven years. |
Goodwill | Goodwill Goodwill consists of the excess of acquisition costs over the fair values of net assets acquired in business combinations. It is not amortized, but rather is tested at the reporting unit level at least annually for impairment or more frequently if triggering events or changes in circumstances indicate impairment. Initially, qualitative factors are considered to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. Some of these qualitative factors may include macroeconomic conditions, industry and market considerations, a change in financial performance, entity-specific events, a sustained decrease in share price, and consideration of the difference between the fair value and carrying amount of a reporting unit as determined in the most recent quantitative assessment. If, through this qualitative assessment, the conclusion is made that it is more likely than not that a reporting unit's fair value is less than its carrying amount, a quantitative impairment analysis is performed. A quantitative impairment analysis involves estimating the fair value of a reporting unit using widely-accepted valuation methodologies including the income and market approaches, which requires the use of estimates and assumptions. These estimates and assumptions include revenue growth rates, discounts rates, and determination of appropriate market comparables. If the fair value of the reporting unit is less than its carrying amount, an impairment loss is recognized in an amount equal to that excess, not to exceed the carrying amount of the goodwill. We performed assessments of goodwill in the fourth quarters of 2017 , 2016 and 2015 , and determined no impairments were indicated in those years. We evaluate goodwill at the reporting unit level. Our goodwill asset related to our Canadian subsidiary is attributable to our Direct reporting unit, and our goodwill related to the Octane acquisition is attributable to our Retail reporting unit. For further information regarding goodwill, see Note 9, Goodwill |
Other intangible assets | Other Intangible Assets Indefinite-lived intangible assets consist of acquired trademarks, specifically trade names. Indefinite-lived intangible assets are stated at cost and are not amortized; instead, they are tested for impairment at least annually. We review our indefinite-lived trademarks for impairment in the fourth quarter of each year and when events or changes in circumstances indicate that the assets may be impaired. The fair value of trademarks is estimated using the relief-from-royalty method to estimate the value of the cost savings and a discounted cash flows method to estimate the value of future income. The sum of these two values for each trademark is the fair value of the trademark. If the carrying amount of trademarks exceeds the estimated fair value, we calculate impairment as the excess of carrying amount over the estimate of fair value. We tested our indefinite-lived trademarks for impairment in the fourth quarters of 2017 , 2016 and 2015 . During the fourth quarter of 2017 , we identified impairment indicators in our Octane Fitness brand name originally acquired through the Octane Fitness acquisition on December 31, 2015 . Ongoing weakness in the specialty retail channel, as a result of retailer consolidation, has had a negative impact on Octane branded sales and projected growth trends. We utilized the relief-from-royalty method to quantify the impairment, resulting in an $8.8 million non-cash impairment charge for 2017 . The impairment charge is recorded in operating expenses on the consolidated statements of operations. We determined no impairment was indicated in 2016 and 2015 for our indefinite-lived intangible assets. Definite-lived intangible assets, primarily acquired trade names, customer relationships, patents and patent rights, are stated at cost, net of accumulated amortization, and are evaluated for impairment as discussed below under Impairment of Long-Lived Assets . We recognize amortization expense for our definite-lived intangible assets on a straight-line basis over the estimated useful lives. For further information regarding other intangible assets, see Note 10, Other Intangible Assets |
Impairment of long-lived assets | Impairment of Long-Lived Assets Long-lived assets, including property, plant and equipment and definite-lived intangible assets, are evaluated for impairment when events or circumstances indicate the carrying value may be impaired. When such an event or condition occurs, we estimate the future undiscounted cash flows to be derived from the use and eventual disposition of the asset to determine whether a potential impairment exists. If the carrying value exceeds estimated future undiscounted cash flows, we record impairment expense to reduce the carrying value of the asset to its estimated fair value. No impairment charges were recorded in 2017 , 2016 and 2015 |
Share Repurchases | Share Repurchases Shares of our common stock may be repurchased from time to time as authorized by our Board of Directors. Repurchases may be made in open market transactions at prevailing prices, in privately negotiated transactions, or by other means in accordance with federal securities laws. Share repurchases are funded from existing cash balances, and repurchased shares are retired and returned to unissued authorized shares. These repurchases are accounted for as reductions to our common stock to the extent available with remaining amounts allocated against retained earnings. |
Revenue recognition | Revenue Recognition Direct and Retail product sales and shipping revenues are recorded when products are shipped and title passes to customers. In most instances, Retail sales to customers are made pursuant to a sales contract that provides for transfer of both title and risk of loss to the customer upon our delivery to the carrier. For Direct sales, revenue is generally recognized when products are shipped. Revenue is recognized net of applicable sales incentives, such as promotional discounts, rebates and return allowances. We estimate the revenue impact of incentive programs based on the planned duration of the program and historical experience. |
Sales discounts and allowances | Sales Discounts and Returns Allowance Product sales and shipping revenues are reported net of promotional discounts and return allowances. We estimate the revenue impact of retail sales incentive programs based on the planned duration of the program and historical experience. If the amount of sales incentives is reasonably estimable, the impact of such incentives is recorded at the later of the time the customer is notified of the sales incentive or the time of the sale. We estimate our liability for product returns based on historical experience and record the expected obligation as a reduction of revenue. If actual return costs differ from previous estimates, the amount of the liability and corresponding revenue are adjusted in the period in which such costs occur. Activity in our sales discounts and returns allowance was as follows (in thousands): |
Taxes collected from customers and remitted to governmental authorities | Taxes Collected from Customers and Remitted to Governmental AuthoritiesTaxes collected from customers and remitted to governmental authorities are recorded on a net basis and excluded from net sales. |
Shipping and handling fees | Shipping and Handling Fees Shipping and handling fees billed to customers are recorded net of discounts and included in both net sales and cost of sales. |
Cost of sales | Cost of SalesCost of sales primarily consists of: inventory costs; royalties paid to third parties; employment and occupancy costs of warehouse and distribution facilities, including depreciation of improvements and equipment; transportation expenses; product warranty expenses; distribution information systems expenses; and allocated expenses for shared administrative functions. |
Product warranty obligations | Product Warranty Obligations Our products carry defined warranties for defects in materials or workmanship which, according to their terms, generally obligate us to pay the costs of supplying and shipping replacement parts to customers and, in certain instances, pay for labor and other costs to service products. Outstanding product warranty periods range from thirty days to, in limited circumstances, the lifetime of certain product components. We record a liability at the time of sale for the estimated costs of fulfilling future warranty claims. If necessary, we adjust the liability for specific warranty-related matters when they become known and are reasonably estimable. Estimated warranty expense is included in cost of sales, based on historical warranty claim experience and available product quality data. Warranty expense is affected by the performance of new products, significant manufacturing or design defects not discovered until after the product is delivered to the customer, product failure rates, and higher or lower than expected repair costs. If warranty expense differs from previous estimates, or if circumstances change such that the assumptions inherent in previous estimates are no longer valid, the amount of product warranty obligations is adjusted accordingly. |
Litigation and loss contingencies | Litigation and Loss Contingencies From time to time, we may be involved in various claims, lawsuits and other proceedings. These legal and tax proceedings involve uncertainty as to the eventual outcomes and losses which may be realized when one or more future events occur or fail to occur. We record expenses for litigation and loss contingencies as a component of general and administrative expense when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. When a loss contingency is not both probable and estimable, we do not establish an accrued liability. However, if the loss (or an additional loss in excess of the accrual) is at least a reasonable possibility and material, then we disclose an estimate of the possible loss or range of loss, if such estimate can be made, or disclose that an estimate cannot be made. |
Advertising and promotion | Advertising and Promotion |
Research and development | Research and Development Internal research and development costs, which primarily consist of salaries and wages, employee benefits, expenditures for materials, and fees to use licensed technologies, are expensed as incurred. Third-party research and development costs for products under development or being researched, if any, are expensed as the contracted work is performed. In addition, we capitalize costs to develop software for internal use in accordance with accounting guidance. |
Income taxes | Income Taxes We account for income taxes based on the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates expected to be in effect when the temporary differences are expected to be included, as income or expense, in the applicable tax return. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the period of the enactment. Valuation allowances are provided against deferred income tax assets if we determine it is more likely than not that such assets will not be realized. Unrecognized Tax Benefits |
Foreign currency translation | Foreign Currency Translation We translate the accounts of our non-U.S. subsidiaries into U.S. dollars as follows: revenues, expenses, gains and losses are translated at weighted-average exchange rates during the year; and assets and liabilities are translated at the exchange rate on the balance sheet date. Translation gains and losses are reported in our consolidated balance sheets as a component of accumulated other comprehensive income. Gains and losses arising from foreign currency transactions, including transactions between us and our non-U.S. subsidiaries, are recorded as a component of other income (expense) in our consolidated statements of operations. |
Fair value of financial instruments | Fair Value of Financial Instruments The carrying values of cash and cash equivalents, trade receivables, prepaids and other current assets, trade payables and accrued liabilities approximate fair value due to their short maturities. For additional information on financial instruments recorded at fair value on a recurring basis as of December 31, 2017 and 2016 , refer to Note 4, Fair Value Measurements |
Share-Based Compensation | Stock-Based Compensation We recognize stock-based compensation expense on a straight-line basis over the applicable vesting period, based on the grant-date fair value of the award. To the extent a stock-based award is subject to performance conditions, the amount of expense recorded in a given period, if any, reflects our assessment of the probability of achieving the performance targets. Fair value of stock options is estimated using the Black-Scholes-Merton option valuation model; fair value of performance share unit ("PSU") awards, restricted stock unit ("RSU") awards and restricted stock awards ("RSA") is based on the closing market price on the day preceding the grant. Prior to our adoption of Financial Accounting Standards Board's ("FASB") Accounting Standards Update ("ASU") 2016-09 in January 2017, we estimated future forfeitures, at the time of grant and in subsequent periods, based on historical turnover rates, previous forfeiture experience and changes in the business or key personnel that would suggest future forfeitures may differ from historical data. We recognized compensation expense for only those stock options and other stock-based awards that were expected to vest. We reevaluated estimated forfeitures monthly and, if applicable, recognized a cumulative effect adjustment in the period of the change if the revised estimate of the impact of forfeitures differed significantly from the previous estimate. With our adoption of ASU 2016-09, we changed our accounting treatment of forfeiture expense reversals from "at vest date" to "at forfeiture date." As a result, we no longer estimate future forfeitures prior to their actual occurrence. Shares to be issued upon the exercise of stock options or the vesting of stock awards will come from newly issued shares. |
Income Per Share Amounts | Income Per Share AmountsBasic income per share amounts were computed using the weighted average number of common shares outstanding. Diluted income per share amounts were calculated using the number of basic weighted average shares outstanding increased by dilutive potential common shares related to stock-based awards, as determined by the treasury stock method. |
New Accounting Pronouncements | New Accounting Pronouncements Newly-Adopted Pronouncements ASU 2017-04 In January 2017, the FASB issued ASU 2017-04, "Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment." ASU 2017-04 simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. An entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, if applicable. The loss recognized should not exceed the total amount of goodwill allocated to the reporting unit. The same impairment test also applies to any reporting unit with a zero or negative carrying amount. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. ASU 2017-04 is effective for public companies' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2019, on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed after January 1, 2017. Our early adoption of ASU 2017-04 for our annual goodwill impairment testing as of October 1, 2017 did not have a material effect on our financial position, results of operations or cash flows. ASU 2016-09 In March 2016, the FASB issued ASU 2016-09, "Compensation - Stock Compensation (Topic 718) - Improvements to Employee Share-Based Payment Accounting." ASU 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted subject to certain requirements, and the method of application (i.e., retrospective, modified retrospective or prospective) depends on the transaction area that is being amended. Related to forfeitures, we changed our accounting treatment of forfeiture expense reversals from "at vest date" to "at forfeiture date." We applied the guidance on a modified retrospective basis, which resulted in a $28,308 cumulative effective adjustment and reduction to beginning retained earnings as of January 1, 2017 . In addition, related to excess tax benefits, we recognized all current period expense through the statement of operations and presented excess tax benefits as an operating cash flow, applied prospectively, with no adjustment to prior periods. The adoption of ASU 2016-09 in January 2017 did not have a material impact on our financial position, results of operations or cash flows. ASU 2015-11 In July 2015, the FASB issued ASU 2015-11, “Simplifying the Measurement of Inventory (Topic 330).” ASU 2015-11 simplifies the accounting for the valuation of all inventory not accounted for using the last-in, first-out (“LIFO”) method by prescribing inventory be valued at the lower of cost and net realizable value. ASU 2015-11 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2016 on a prospective basis. Early adoption is permitted. Our adoption of ASU 2015-11 in January 2017 did not have a material effect on our financial position, results of operations or cash flows. Issued Not Yet Adopted Pronouncements ASU 2017-12 In August 2017, the FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815) - Targeted Improvements to Accounting for Hedging Activities." ASU 2017-12 provides better alignment of an entity's risk management activities and financial reporting of hedges through changes to both the designation and measurement guidance for qualifying hedging relationships. In addition, the amendments in ASU 2017-12 also simplify the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements to increase the understandability of the results of an entity's intended hedging strategies. ASU 2017-12 is effective for public companies' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2018. Early application is permitted in any interim period after issuance of the new standard, with effect of adoption reflected as of the beginning of the fiscal year of adoption. For cash flow and net investment hedges existing as of the adoption date, an entity should apply a cumulative-effect adjustment related to eliminating the separate measurement of ineffectiveness to accumulated other comprehensive income and opening retaining earnings. Amended presentation and disclosure guidance is required only prospectively, and certain transition elections are available upon adoption. While we do not expect the adoption of ASU 2017-12 to have a material effect on our business, we are evaluating any potential impact that adoption of ASU 2017-12 may have on our financial position, results of operations or cash flows. ASU 2017-09 In May 2017, the FASB issued ASU 2017-09, "Compensation - Stock Compensation (Topic 718) - Scope in Modification Accounting." ASU 2017-09 provides clarity and reduces diversity in practice and cost and complexity when applying the guidance in Topic 718 to a change to the terms or conditions of a share-based payment award. An entity should account for the effects of a modification unless all of certain criteria are met. Those criteria relate to fair value, vesting conditions and classification of the modified award. If all three conditions are the same for the modified award as for the original award, then the entity should not account for the effects of the modification. ASU 2017-09 is effective for all entities for annual periods, including interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period, for public business entities for reporting periods for which financial statements have not yet been issued. We do not expect the adoption of ASU 2017-09 to have a material effect on our financial position, results of operations or cash flows. ASU 2016-15 In August 2016, the FASB issued ASU 2016-15, "Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments." The amendments in ASU 2016-15 are intended to add or clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows, with the intent of reducing diversity in practice for the eight (8) types of cash flows identified. ASU 2016-15 is effective for public companies' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted. Entities must apply the guidance retrospectively to all periods presented, but may apply it prospectively if retrospective application would be impracticable. We do not expect the adoption of ASU 2016-15 to have a material effect on our financial position, results of operations or cash flows. ASU 2016-13 In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments." The amendments in ASU 2016-13 replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2019, using a modified-retrospective approach, with certain exceptions. Early adoption is permitted. While we do not expect the adoption of ASU 2016-13 to have a material effect on our business, we are evaluating any potential impact that adoption of ASU 2016-13 may have on our financial position, results of operations or cash flows. ASU 2016-02 In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)." ASU 2016-02 replaces the existing guidance in Accounting Standards Codification ("ASC") 840, Leases. The new standard would require companies and other organizations to include lease obligations on their balance sheets, including a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use ("ROU") asset and a corresponding lease liability. For finance leases the lessee would recognize interest expense and amortization of the ROU asset, and for operating leases the lessee would recognize a straight-line total lease expense. Lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. ASU 2016-02 is effective for public companies' annual periods, and interim periods within those fiscal years, beginning after December 15, 2018. We are currently assessing the impact that ASU 2016-02 will have on our consolidated financial statements, and expect that the primary impact upon adoption will be the recognition, on a discounted basis, of our minimum commitments under non-cancellable operating leases on our consolidated balance sheets resulting in the recording of right of use assets and lease liabilities. ASU 2014-09 In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers." ASU 2014-09 replaces most existing revenue recognition guidance, and requires companies to recognize revenue based upon the transfer of promised goods and/or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and/or services. In addition, the new guidance requires enhanced disclosures, including revenue recognition policies to identify performance obligations to customers and significant judgments in measurement and recognition. ASU 2014-09 is effective, as amended, for annual and interim periods beginning on or after December 15, 2017, applied retrospectively to each prior period presented or retrospectively with a cumulative effect adjustment recognized as of the adoption date. We are adopting the new standard on January 1, 2018 using the full retrospective method. We have identified and analyzed our principal revenue streams by channel, including potential impacts on the timing of recognition of variable consideration and consideration payable to a customer, primarily related to our sales discounts and allowances programs, and contract costs, mainly sales commissions, as well as presentation of our extended warranty and installation services revenue. We are also substantially complete with our review of significant contracts and our evaluation of the potential changes to our business processes, controls, systems and disclosures resulting from adoption of the new standard. We expect to finalize documentation of these assessments during the first quarter of 2018 |
Significant Accounting Polici34
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule of Sales Discounts and Returns Allowance | Activity in our sales discounts and returns allowance was as follows (in thousands): 2017 2016 2015 Balance, January 1 $ 5,901 $ 5,677 $ 4,296 Charges to reserve 18,377 12,935 16,700 Reductions for sales discounts and returns (17,358 ) (12,711 ) (15,569 ) Business acquisition (Note 2) — — 250 Balance, December 31 $ 6,920 $ 5,901 $ 5,677 |
Business Acquisition (Tables)
Business Acquisition (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the fair values of the net assets acquired and liabilities assumed as of the acquisition date, including all measurement period adjustments (in thousands): Final valuation at December 31, 2016 Cash $ 7,759 Accounts receivable 12,476 Inventories 13,134 Prepaid expenses 885 Deferred tax assets 1,303 Property, plant and equipment 3,372 Intangible assets 63,100 Total assets acquired 102,029 Accounts payable 6,497 Accrued liabilities 2,968 Warranty obligations 5,550 Deferred tax liabilities, non-current 21,033 Other non-current liabilities 390 Total liabilities assumed 36,438 Net identifiable assets acquired 65,591 Goodwill 59,705 Net assets acquired $ 125,296 |
Business Acquisition, Pro Forma Information | The following table reflects the unaudited pro forma consolidated results of operations for the periods presented, as though the acquisition of Octane had occurred on January 1, 2014 (in thousands, except per share amounts): (unaudited) Year Ended December 31, 2016 2015 Net sales $ 406,039 $ 400,078 Net income 35,683 29,352 Net income per share: Basic $ 1.15 $ 0.94 Diluted 1.14 0.93 |
Discontinued Operation (Tables)
Discontinued Operation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Operating Results of Company's Former Commercial Business | Following is a summary of certain financial information regarding our discontinued operations (in thousands): Year Ended December 31, 2017 2016 2015 Loss from discontinued operations before income taxes $ (1,713 ) $ (1,077 ) $ (601 ) Income tax benefit (355 ) (154 ) (400 ) Total loss from discontinued operations $ (1,358 ) $ (923 ) $ (201 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Assets Measured on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis were as follows (in thousands): December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Cash Equivalents Money market funds $ 10,946 $ — $ — $ 10,946 Commercial paper — 1,996 — 1,996 Total cash equivalents 10,946 1,996 — 12,942 Available-for-Sale Securities Certificates of deposit (1) — 19,875 — 19,875 Corporate bonds — 29,239 — 29,239 U.S. government bonds — 8,189 — 8,189 Total available-for-sale securities — 57,303 — 57,303 Derivatives Interest rate swap contract — 372 — 372 Foreign currency forward contracts — 390 — 390 Total derivatives — 762 — 762 Total assets measured at fair value $ 10,946 $ 60,061 $ — $ 71,007 December 31, 2016 Level 1 Level 2 Level 3 Total Assets: Cash Equivalents Money market funds $ 9,635 $ — $ — $ 9,635 Commercial paper — 3,999 — 3,999 Total cash equivalents 9,635 3,999 — 13,634 Available-for-Sale Securities Certificates of deposit (1) — 22,820 — 22,820 Corporate bonds — 6,922 — 6,922 U.S. government bonds — 2,001 — 2,001 Total available-for-sale securities — 31,743 — 31,743 Total assets measured at fair value $ 9,635 $ 35,742 $ — $ 45,377 Liabilities: Derivatives Interest rate swap contract $ — $ (38 ) $ — $ (38 ) Total liabilities measured at fair value $ — $ (38 ) $ — $ (38 ) (1) |
Derivatives (Tables)
Derivatives (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Liabilities at Fair Value | The fair value of our derivative instruments was included in our consolidated balance sheets as follows (in thousands): Balance Sheet Classification As of December 31, 2017 2016 Derivative instruments designated as cash flow hedges: Interest rate swap contract Prepaids and other current assets $ 134 $ — Other assets 238 — Accrued liabilities — (38 ) $ 372 $ (38 ) Derivative instruments not designated as cash flow hedges: Foreign currency forward contracts Prepaids and other current assets $ 390 $ — $ 390 $ — |
Derivative Instruments, Gain (Loss) | The effect of derivative instruments on our consolidated statements of operations was as follows (in thousands): Statement of Operations Classification Year Ended December 31, 2017 2016 2015 Derivative instruments designated as cash flow hedges: Gain (loss) recognized in other comprehensive income before reclassifications --- $ 80 $ (450 ) $ — Loss reclassified from accumulated other comprehensive income to earnings for the effective portion Interest expense (207 ) (626 ) — Income tax benefit Income tax expense 47 200 — Derivative instruments not designated as cash flow hedges: Loss recognized in earnings Other, net $ (382 ) $ — $ — Income tax benefit Income tax expense 86 — — |
Trade Receivables (Tables)
Trade Receivables (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Allowance for doubtful accounts | Trade receivables, net, consisted of the following (in thousands): As of December 31, 2017 2016 Trade receivables $ 42,804 $ 45,628 Allowance for doubtful accounts (119 ) (170 ) $ 42,685 $ 45,458 |
Schedule Of Changes In Allowance For Doubtful Accounts | Changes in our allowance for doubtful trade receivables were as follows (in thousands): 2017 2016 2015 Balance, January 1 $ 170 $ 918 $ 108 Charges to bad debt expense 311 289 786 Recoveries (write-offs), net (362 ) (1,037 ) 24 Balance, December 31 $ 119 $ 170 $ 918 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories, Net of Valuation Allowances | Our inventories consisted of the following (in thousands): As of December 31, 2017 2016 Finished goods $ 48,771 $ 43,130 Parts and components 4,583 3,900 $ 53,354 $ 47,030 |
Property, Plant, and Equipment
Property, Plant, and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment consisted of the following (in thousands): Estimated Useful Life (in years) As of December 31, 2017 2016 Automobiles 5 to 6 $ 23 $ 139 Leasehold improvements 4 to 20 3,542 3,388 Computer software and equipment 3 to 7 17,024 25,899 Machinery and equipment 3 to 5 15,178 13,085 Furniture and fixtures 5 to 20 2,295 2,238 Work in progress (1) N/A 1,052 768 Total cost 39,114 45,517 Accumulated depreciation (23,287 ) (28,049 ) $ 15,827 $ 17,468 (1) Work in progress primarily includes production tooling and equipment and information technology assets. Depreciation expense was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Depreciation expense $ 5,387 $ 4,320 $ 2,558 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill [Table Text Block] | The rollforward of goodwill was as follows (in thousands): Direct Retail Total Balance, January 1, 2015 $ 2,520 $ — $ 2,520 Currency exchange rate adjustment (407 ) — (407 ) Business acquisition (Note 2) — 58,357 58,357 Balance, December 31, 2015 2,113 58,357 60,470 Currency exchange rate adjustment 67 3 70 Measurement period adjustments (Note 2) — 1,348 1,348 Balance, December 31, 2016 2,180 59,708 61,888 Currency exchange rate adjustment 155 (13 ) 142 Balance, December 31, 2017 $ 2,335 $ 59,695 $ 62,030 |
Other Intangible Assets (Tables
Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other Intangible Assets | OTHER INTANGIBLE ASSETS Other intangible assets consisted of the following (in thousands): Estimated Useful Life (in years) As of December 31, 2017 2016 Indefinite-lived trademarks (1) N/A $ 23,252 $ 32,052 Definite-lived trademarks 10 to 15 2,600 2,600 Patents 8 to 24 15,187 31,487 Customer relationships 10 to 15 24,700 24,700 65,739 90,839 Accumulated amortization - definite-lived intangible assets (7,996 ) (21,039 ) $ 57,743 $ 69,800 (1) During the fourth quarter of 2017 , we identified impairment indicators in our Octane Fitness brand name originally acquired through the Octane Fitness acquisition on December 31, 2015 . Ongoing weakness in the specialty retail channel, as a result of retailer consolidation, has had a negative impact on Octane branded sales and projected growth trends. We utilized the relief-from-royalty method to quantify the impairment, resulting in an $8.8 million non-cash impairment charge for 2017 . Amortization expense was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Amortization expense $ 3,256 $ 3,554 $ 854 Future amortization of definite-lived intangible assets is as follows (in thousands): 2018 $ 3,164 2019 3,134 2020 3,108 2021 3,078 2022 3,078 Thereafter 18,929 $ 34,491 |
Schedule of Intangible Assets and Goodwill [Table Text Block] | Other intangible assets consisted of the following (in thousands): Estimated Useful Life (in years) As of December 31, 2017 2016 Indefinite-lived trademarks (1) N/A $ 23,252 $ 32,052 Definite-lived trademarks 10 to 15 2,600 2,600 Patents 8 to 24 15,187 31,487 Customer relationships 10 to 15 24,700 24,700 65,739 90,839 Accumulated amortization - definite-lived intangible assets (7,996 ) (21,039 ) $ 57,743 $ 69,800 |
Amortization expense | Amortization expense was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Amortization expense $ 3,256 $ 3,554 $ 854 |
Future amortization expense | Future amortization of definite-lived intangible assets is as follows (in thousands): 2018 $ 3,164 2019 3,134 2020 3,108 2021 3,078 2022 3,078 Thereafter 18,929 $ 34,491 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Liabilities [Abstract] | |
Schedule of Accrued Liabilities [Table Text Block] | Accrued liabilities consisted of the following (in thousands): As of December 31, 2017 2016 Payroll and related liabilities $ 3,659 $ 4,579 Other 7,105 8,313 Total accrued liabilities $ 10,764 $ 12,892 |
Product Warranties (Tables)
Product Warranties (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Product Warranties Disclosures [Abstract] | |
Schedule of Product Warranty Liability | Changes in our product warranty obligations were as follows (in thousands): 2017 2016 2015 Balance, January 1 $ 7,450 $ 8,545 $ 2,246 Accruals 3,008 2,480 2,302 Payments (4,341 ) (3,575 ) (1,553 ) Business acquisition (Note 2) — — 5,550 Balance, December 31 $ 6,117 $ 7,450 $ 8,545 |
Borrowings (Tables)
Borrowings (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Maturities of Long-term Debt | aturities of our Term Loan over the next five years are as follows (in thousands): 2018 $ 16,000 2019 16,000 2020 16,000 $ 48,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block] | Income from continuing operations before income taxes was as follows (in thousands): Year Ended December 31, 2017 2016 2015 U.S. $ 34,259 $ 50,651 $ 39,242 Non-U.S. 1,446 930 780 $ 35,705 $ 51,581 $ 40,022 |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | Income tax expense (benefit) from continuing operations was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Current: U.S. federal $ 14,409 $ 6,765 $ 858 U.S. state 1,887 318 171 Non-U.S. 330 118 355 Total current 16,626 7,201 1,384 Deferred: U.S. federal (9,418 ) 8,130 11,324 U.S. state 819 1,037 573 Non-U.S. 53 112 (62 ) Total deferred (8,546 ) 9,279 11,835 $ 8,080 $ 16,480 $ 13,219 |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | Individually significant components of deferred income tax assets and liabilities were as follows (in thousands): As of December 31, 2017 2016 Deferred income tax assets: Accrued liabilities $ 3,000 $ 5,089 Allowance for doubtful accounts 12 40 Inventory valuation 254 199 Capitalized indirect inventory costs 383 497 Stock-based compensation expense 897 1,346 Deferred rent 588 865 Accrued royalty — 429 Net operating loss carryforward 1,715 2,377 Basis difference on long-lived assets 548 1,052 Credit carryforward 634 615 Other 179 140 Gross deferred income tax assets 8,210 12,649 Valuation allowance (914 ) (886 ) Deferred income tax assets, net of valuation allowance 7,296 11,763 Deferred income tax liabilities: Prepaid advertising (370 ) (1,302 ) Other prepaids (610 ) (744 ) Basis difference of long-lived assets (14,856 ) (26,215 ) Undistributed earnings of foreign subsidiaries — (457 ) Other (18 ) (25 ) Deferred income tax liabilities (15,854 ) (28,743 ) Net deferred income tax liabilities $ (8,558 ) $ (16,980 ) Our net deferred income tax assets (liabilities) were recorded on our consolidated balance sheets as follows (in thousands): As of December 31, 2017 2016 Deferred income tax assets, non-current — 11 Deferred income tax liabilities, non-current (8,558 ) (16,991 ) Net deferred income tax liabilities $ (8,558 ) $ (16,980 ) |
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | Following is a reconciliation of the U.S. statutory federal income tax rate with our effective income tax rate for continuing operations: Year Ended December 31, 2017 2016 2015 U.S. statutory income tax rate 35.0 % 35.0 % 35.0 % State tax, net of U.S. federal tax benefit 5.0 2.4 2.6 Non-U.S. income taxes (0.1 ) 0.3 (0.1 ) Nondeductible operating expenses 0.8 0.3 0.8 Research and development credit (1.5 ) (1.0 ) (0.6 ) Change in deferred tax measurement rate (1) (15.3 ) (0.1 ) — Change in uncertain tax positions 0.8 (5.1 ) 1.1 Excess tax benefits from stock plans (2.1 ) — — Change in valuation allowance 0.1 0.2 (5.8 ) Other (0.1 ) (0.1 ) — Effective income tax rate 22.6 % 31.9 % 33.0 % (1) |
Summary of Income Tax Carryforwards [Table Text Block] | As of December 31, 2017 , we had the following income tax carryforwards (in millions): Amount Expires in Net operating loss carryforwards U.S. state $ 32.0 2018 - 2035 China $ 0.8 2020 - 2022 Income tax credit carryforwards U.S. state $ 0.9 2018 - 2031 |
Schedule of Reconciliatin of Gross Unrecognized Tax Benefits From Uncertain Tax Positions Roll Forward [Table Text Block] | Following is a reconciliation of gross unrecognized tax benefits from uncertain tax positions, excluding the impact of penalties and interest (in thousands): Year Ended December 31, 2017 2016 2015 Balance, January 1 $ 1,970 $ 2,519 $ 2,768 Additions for tax positions taken in prior years 38 21 1 Reductions for tax positions taken in prior years (5 ) (523 ) (426 ) Additions for tax positions related to the current year 211 83 43 Lapses of statutes of limitations (11 ) (130 ) — Other (9 ) — 133 Balance, December 31 $ 2,194 $ 1,970 $ 2,519 |
Accumulated Other Comprehensi48
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table sets forth the changes in accumulated other comprehensive income (loss), net of tax (in thousands) for the periods presented: Unrealized Gain (Loss) on Available-for-Sale Securities Gain (loss) on Derivative Securities Foreign Currency Translation Adjustments Accumulated Other Comprehensive Income (Loss) Balance, January 1, 2015 $ (18 ) $ — $ (290 ) $ (308 ) Current period other comprehensive income (loss) 2 — (1,021 ) (1,019 ) Balance, December 31, 2015 (16 ) — (1,311 ) (1,327 ) Current period other comprehensive income (loss) before reclassifications 8 (450 ) 126 (316 ) Reclassification of amounts to earnings — 426 — 426 Net other comprehensive income (loss) during period 8 (24 ) 126 110 Balance, December 31, 2016 (8 ) (24 ) (1,185 ) (1,217 ) Current period other comprehensive income (loss) before reclassifications (56 ) 80 774 798 Reclassification of amounts to earnings — 160 — 160 Net other comprehensive income (loss) during period (56 ) 240 774 958 Balance, December 31, 2017 $ (64 ) $ 216 $ (411 ) $ (259 ) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Stock option activity | Stock option activity was as follows (shares in thousands): Options Outstanding Weighted- Average Exercise Price Outstanding at December 31, 2016 433 $ 5.03 Forfeited, canceled or expired (1 ) 15.58 Exercised (135 ) 4.15 Outstanding at December 31, 2017 297 $ 5.37 |
Stock options outstanding | Certain information regarding options outstanding at December 31, 2017 was as follows: Options Outstanding Options Exercisable Options Vested and Expected to Vest Number (in thousands) 297 291 297 Weighted-average exercise price $ 5.37 $ 5.19 $ 5.37 Aggregate intrinsic value (in thousands) $ 2,405 $ 2,401 $ 2,405 Weighted average remaining contractual term (in years) 2.1 2.0 2.1 |
RSU activity | Compensation expense for RSAs is recognized over the estimated vesting period. Following is a summary of RSA activity (shares in thousands): RSAs Outstanding Weighted- Average Grant Date Fair Value per Share Outstanding at December 31, 2016 44 $ 16.31 Granted 17 17.60 Vested (14 ) 17.91 Outstanding at December 31, 2017 47 $ 16.28 RSUs Outstanding Weighted- Average Grant Date Fair Value per Share Outstanding at December 31, 2016 109 $ 18.17 Granted 108 16.94 Forfeited, canceled or expired (24 ) 17.78 Vested (2 ) 19.07 Outstanding at December 31, 2017 191 $ 17.64 |
PSU activity | Following is a summary of PSU activity (shares in thousands): PSUs Outstanding Weighted- Average Grant Date Fair Value per Share Outstanding at December 31, 2016 264 $ 14.66 Granted and additional goal shares awarded 113 13.84 Forfeited, canceled or expired (81 ) 16.99 Vested (124 ) 8.23 Outstanding at December 31, 2017 172 $ 17.65 |
Stock-based compensation | Stock-based compensation expense, primarily included in general and administrative expense, was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Stock options $ 84 $ 389 $ 327 RSAs 287 168 — RSUs 954 734 544 PSUs 408 1,211 575 ESPP 123 111 38 $ 1,856 $ 2,613 $ 1,484 |
Other information regarding stock-based compensation | Certain other information regarding our stock-based compensation was as follows (in thousands, except per share amounts): Year Ended December 31, 2017 2016 2015 Weighted average grant-date per share fair value of stock options granted $ — $ — $ 8.94 Total intrinsic value of stock options exercised 1,522 1,221 4,142 Fair value of RSUs vested 28 311 673 Fair value of PSUs vested 2,036 574 1,454 |
ESPP Activity | ESPP activity was as follows (shares in thousands): Shares Available for Issuance Weighted- Weighted-Average Discount per Share Balance at December 31, 2016 469 Employee shares purchased (37 ) $ 13.20 $ 2.19 Balance at December 31, 2017 432 |
Assumptions | Assumptions used in calculating the fair value of stock option grants and employee stock purchases were as follows: Year Ended December 31, 2017 2016 2015 ESPP ESPP ESPP Options Dividend yield —% —% —% —% Risk-free interest rate 0.8% 0.4% 0.1% 1.6% Expected life (years) N/A N/A N/A 4.28 Expected volatility 44% 56% 43% 71% |
Stock Repurchase Program Stoc50
Stock Repurchase Program Stock Repurchase Program (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Class of Treasury Stock | Repurchases for 2015 through 2017 for all programs were as follows: Year Ended Number of Shares Repurchased Amount Average Price per Share December 31, 2015 711,708 $11,567,527 $16.25 December 31, 2016 319,805 5,390,355 16.86 December 31, 2017 788,416 11,054,983 14.02 Totals to Date 1,819,929 $28,012,865 $15.39 |
Income Per Share (Tables)
Income Per Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Average Number of Shares Outstanding Used to Compute Income Per Share | The weighted average numbers of shares outstanding used to compute income per share amounts were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Shares used for basic per share calculations 30,671 31,032 31,288 Dilutive effect of outstanding options, RSUs, and PSUs 339 269 301 Shares used for diluted per share calculations 31,010 31,301 31,589 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The weighted average numbers of shares outstanding listed in the table below were anti-dilutive and excluded from the computation of diluted income per share, primarily because the average market price did not exceed the exercise price. These shares may be dilutive potential common shares in the future (in thousands): As of December 31, 2017 2016 2015 Stock options 8 8 12 |
401(k) Savings Plan (Tables)
401(k) Savings Plan (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Defined Contribution Plan, Schedule Of Matching Contributions | Our matching contributions for the savings plan were as follows (in thousands): Year ended December 31, 2017 2016 2015 401(k) matching contributions $ 1,056 $ 1,014 $ 746 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Summary Information by Reportable Segments | Following is summary information by reportable segment (in thousands): Year Ended December 31, 2017 2016 2015 Net Sales: Direct $ 219,440 $ 225,057 $ 225,595 Retail 183,875 177,920 106,195 Unallocated royalty 2,869 3,062 3,974 Consolidated net sales $ 406,184 $ 406,039 $ 335,764 Contribution: Direct $ 34,900 $ 43,215 $ 39,940 Retail 27,495 29,451 12,850 Unallocated royalty 2,852 3,018 3,974 Consolidated contribution $ 65,247 $ 75,684 $ 56,764 Reconciliation of consolidated contribution to income from continuing operations: Consolidated contribution $ 65,247 $ 75,684 $ 56,764 Amounts not directly related to segments: Operating expenses (28,944 ) (22,290 ) (16,493 ) Other expense, net (598 ) (1,813 ) (249 ) Income tax expense 8,080 16,480 13,219 Income from continuing operations $ 27,625 $ 35,101 $ 26,803 Depreciation and amortization expense: Direct $ 1,666 $ 1,944 $ 868 Retail 4,606 4,775 757 Unallocated corporate 2,371 1,155 1,787 Total depreciation and amortization expense $ 8,643 $ 7,874 $ 3,412 As of December 31, Assets: 2017 2016 Direct $ 40,532 $ 37,388 Retail 192,064 206,580 Unallocated corporate 92,180 89,098 Total assets $ 324,776 $ 333,066 |
Net Sales by Geographic Regions | Net sales by geographic area were as follows: Year Ended December 31, 2017 2016 2015 U.S. $ 352,703 $ 353,893 $ 295,366 Canada 25,589 26,005 33,230 All other 27,892 26,141 7,168 $ 406,184 $ 406,039 $ 335,764 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Rent Expense | Rent expense under all operating leases was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Rent expense $ 6,095 $ 6,561 $ 5,033 |
Schedule of Future Minimum Rental Payments for Operating Leases | As of December 31, 2017 , future minimum lease payments under non-cancellable leases, reduced for sublease income, were as follows (in thousands): 2018 $ 5,016 2019 5,035 2020 4,983 2021 4,021 2022 2,703 Thereafter 4,353 $ 26,111 |
Supplementary Information - Q55
Supplementary Information - Quarterly Results of Operations (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information [Table Text Block] | The following table summarizes our unaudited quarterly financial data for 2017 and 2016 (in thousands, except per share amounts): Quarter Ended March 31 June 30 September 30 December 31 Total 2017 Net sales $ 113,252 $ 77,029 $ 88,132 $ 127,771 $ 406,184 Gross profit 61,745 38,378 41,315 62,444 203,882 Operating income (1) 12,683 3,849 13,365 6,406 36,303 Income from continuing operations (2) 8,185 2,566 8,342 8,532 27,625 Loss from discontinued operations (3) (1,092 ) (77 ) (101 ) (88 ) (1,358 ) Net income 7,093 2,489 8,241 8,444 26,267 Net income per share: Basic $ 0.23 $ 0.08 $ 0.27 $ 0.28 $ 0.86 Diluted 0.23 0.08 0.27 0.27 0.85 2016 Net sales $ 120,928 $ 78,529 $ 80,818 $ 125,764 $ 406,039 Gross profit 66,344 41,862 39,217 64,102 211,525 Operating income 19,300 6,573 8,211 19,310 53,394 Income from continuing operations (4) 11,586 3,696 7,845 11,974 35,101 Loss from discontinued operations (142 ) (166 ) (251 ) (364 ) (923 ) Net income 11,444 3,530 7,594 11,610 34,178 Net income per share: Basic $ 0.37 $ 0.11 $ 0.24 $ 0.38 $ 1.10 Diluted 0.37 0.11 0.24 0.37 1.09 (1) Operating income for the quarter ended December 31, 2017 included an $8.8 million non-cash asset impairment charge related to the Octane Fitness brand name. (2) Income from continuing operations for the quarter ended December 31, 2017 included a non-recurring tax benefit of $5.6 million related to the change in U.S. tax law that resulted in the reassessment of certain deferred tax assets and liabilities. (3) Loss from discontinued operations for the quarter ended March 31, 2017 included a $1.2 million expense related to a lawsuit settlement with Biosig Instruments, Inc. (4) Income from continuing operations for the quarter ended September 30, 2016 included a non-recurring tax benefit of $2.7 million |
Significant Accounting Polici56
Significant Accounting Policies (Details) | Jan. 01, 2017USD ($) | Dec. 31, 2017USD ($)customer | Dec. 31, 2016USD ($)customer | Dec. 31, 2015USD ($)customer |
Significant Accounting Policies [Line Items] | ||||
Asset impairment charge | $ 8,800,000 | $ 0 | $ 0 | |
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Marketing and advertising expense | 66,400,000 | 60,700,000 | $ 54,800,000 | |
Prepaid advertising | $ 1,500,000 | $ 3,500,000 | ||
Minimum | ||||
Significant Accounting Policies [Line Items] | ||||
Product Warranty Period | 30 days | |||
Furniture, equipment and information systems [Member] | Minimum | ||||
Significant Accounting Policies [Line Items] | ||||
Estimated useful life (in years) | 3 years | |||
Furniture, equipment and information systems [Member] | Maximum | ||||
Significant Accounting Policies [Line Items] | ||||
Estimated useful life (in years) | 7 years | |||
Customer Concentration Risk | Consolidated Net Sales | ||||
Significant Accounting Policies [Line Items] | ||||
Number of major customers | customer | 1 | 1,000 | 1,000 | |
Customer Concentration Risk | Customer A [Member] | Consolidated Net Sales | Minimum | ||||
Significant Accounting Policies [Line Items] | ||||
Concentration risk, percentage | 10.00% | 10.00% | 10.00% | |
Customer Concentration Risk | Customer A [Member] | Consolidated Net Sales | Maximum | ||||
Significant Accounting Policies [Line Items] | ||||
Concentration risk, percentage | 15.00% | 15.00% | 15.00% | |
Sales Discounts and Returns Allowance | ||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Beginning Balance | $ 5,901,000 | $ 5,901,000 | $ 5,677,000 | $ 4,296,000 |
Charges to reserve | 18,377,000 | 12,935,000 | 16,700,000 | |
Reductions for sales discounts and returns | (17,358,000) | (12,711,000) | (15,569,000) | |
Business acquisition (Note 2) | 0 | 0 | 250,000 | |
Ending Balance | 6,920,000 | 5,901,000 | $ 5,677,000 | |
Fair Value, Measurements, Recurring | ||||
Significant Accounting Policies [Line Items] | ||||
Cash Equivalents | $ 12,942,000 | $ 13,634,000 | ||
Accounting Standards Update 2016-09 | ||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Cumulative effect on retained earnings | $ 28,308 |
Business Acquisition (Details)
Business Acquisition (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2014 |
Business Acquisition [Line Items] | ||||
Maximum revolving secured credit line | $ 20,000,000 | |||
Goodwill | $ 60,470,000 | 62,030,000 | $ 61,888,000 | $ 2,520,000 |
Octane Fitness | ||||
Business Acquisition [Line Items] | ||||
Purchase price | 115,000,000 | |||
Goodwill | 59,705,000 | |||
JPMorgan Chase Bank, N.A. | Term Loan | Line of Credit | ||||
Business Acquisition [Line Items] | ||||
Maximum revolving secured credit line | $ 80,000,000 | |||
JPMorgan Chase Bank, N.A. | Term Loan | Line of Credit | Octane Fitness | ||||
Business Acquisition [Line Items] | ||||
Maximum revolving secured credit line | $ 80,000,000 |
Business Acquisition - Assets A
Business Acquisition - Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 62,030 | $ 61,888 | $ 60,470 | $ 2,520 |
Octane Fitness | ||||
Business Acquisition [Line Items] | ||||
Cash | 7,759 | |||
Accounts receivable | 12,476 | |||
Inventories | 13,134 | |||
Prepaid expenses | 885 | |||
Deferred tax assets | 1,303 | |||
Property, plant and equipment | 3,372 | |||
Intangible assets | 63,100 | |||
Total assets acquired | 102,029 | |||
Accounts payable | 6,497 | |||
Accrued liabilities | 2,968 | |||
Warranty obligations | 5,550 | |||
Deferred tax liabilities, non-current | 21,033 | |||
Other non-current liabilities | 390 | |||
Total liabilities assumed | 36,438 | |||
Net identifiable assets acquired | 65,591 | |||
Goodwill | 59,705 | |||
Net assets acquired | $ 125,296 |
Business Acquisition - Pro Form
Business Acquisition - Pro Forma (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Business Combinations [Abstract] | ||
Net sales | $ 406,039 | $ 400,078 |
Net income | $ 35,683 | $ 29,352 |
Basic (in dollars per share) | $ 1.15 | $ 0.94 |
Diluted (in dollars per share) | $ 1.14 | $ 0.93 |
Discontinued Operation (Details
Discontinued Operation (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Loss from discontinued operations before income taxes | $ (1,713) | $ (1,077) | $ (601) | ||||||||
Income tax benefit | 154 | 400 | |||||||||
Loss from discontinued operations | $ (88) | $ (101) | $ (77) | $ (1,092) | $ (364) | $ (251) | $ (166) | $ (142) | (1,358) | (923) | (201) |
Payments for legal settlements | $ 1,200 | 1,200 | |||||||||
Commercial [Member] | |||||||||||
Loss from discontinued operations before income taxes | (1,713) | (1,077) | (601) | ||||||||
Income tax benefit | 355 | 154 | 400 | ||||||||
Loss from discontinued operations | $ (1,358) | $ (923) | $ (201) |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Asset impairment charge | $ 8,800 | $ 0 | $ 0 |
Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 12,942 | 13,634 | |
Available-for-Sale Securities | 57,303 | 31,743 | |
Derivative assets | 762 | ||
Total assets measured at fair value | 71,007 | 45,377 | |
Total liabilities measured at fair value | (38) | ||
Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 10,946 | 9,635 | |
Available-for-Sale Securities | 0 | 0 | |
Derivative assets | 0 | ||
Total assets measured at fair value | 10,946 | 9,635 | |
Total liabilities measured at fair value | 0 | ||
Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 1,996 | 3,999 | |
Available-for-Sale Securities | 57,303 | 31,743 | |
Derivative assets | 762 | ||
Total assets measured at fair value | 60,061 | 35,742 | |
Total liabilities measured at fair value | (38) | ||
Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | 0 | |
Available-for-Sale Securities | 0 | 0 | |
Derivative assets | 0 | ||
Total assets measured at fair value | 0 | 0 | |
Total liabilities measured at fair value | 0 | ||
Money market funds | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 10,946 | 9,635 | |
Money market funds | Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 10,946 | 9,635 | |
Money market funds | Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | 0 | |
Money market funds | Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | 0 | |
Certificates of deposit | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 19,875 | 22,820 | |
Certificates of deposit | Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 0 | 0 | |
Certificates of deposit | Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 19,875 | 22,820 | |
Certificates of deposit | Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 0 | 0 | |
Commercial paper | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 1,996 | 3,999 | |
Commercial paper | Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | 0 | |
Commercial paper | Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 1,996 | 3,999 | |
Commercial paper | Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | 0 | |
Corporate bonds | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 29,239 | 6,922 | |
Corporate bonds | Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 0 | 0 | |
Corporate bonds | Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 29,239 | 6,922 | |
Corporate bonds | Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 0 | 0 | |
U.S. government bonds | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 8,189 | 2,001 | |
U.S. government bonds | Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 0 | 0 | |
U.S. government bonds | Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 8,189 | 2,001 | |
U.S. government bonds | Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-Sale Securities | 0 | 0 | |
Interest rate swap contract | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 372 | ||
Derivative liabilities | (38) | ||
Interest rate swap contract | Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 0 | ||
Derivative liabilities | 0 | ||
Interest rate swap contract | Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 372 | ||
Derivative liabilities | (38) | ||
Interest rate swap contract | Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 0 | ||
Derivative liabilities | $ 0 | ||
Foreign currency forward contracts | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 390 | ||
Foreign currency forward contracts | Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 0 | ||
Foreign currency forward contracts | Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 390 | ||
Foreign currency forward contracts | Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | $ 0 |
Derivatives (Details)
Derivatives (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Interest rate swap contract | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 48,000 | |
Derivative, fixed interest rate | 1.42% | |
Interest rate swap contract | LIBOR | ||
Derivative [Line Items] | ||
Derivative, basis spread on variable rate | 1.35% | |
Foreign currency forward contracts | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 22,100 | |
Derivatives Designated as Hedging Instruments | Interest rate swap contract | ||
Derivative [Line Items] | ||
Fair value of liability derivatives | 372 | $ (38) |
Derivatives Designated as Hedging Instruments | Prepaids and other current assets | Interest rate swap contract | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross asset | 134 | 0 |
Derivatives Designated as Hedging Instruments | Accrued liabilities | Interest rate swap contract | ||
Derivative [Line Items] | ||
Fair value of liability derivatives | $ 0 | $ (38) |
Derivatives - Fair value of der
Derivatives - Fair value of derivative instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Interest rate swap contract | Derivatives Designated as Hedging Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | $ 372 | $ (38) |
Interest rate swap contract | Derivatives Designated as Hedging Instruments | Prepaids and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 134 | 0 |
Interest rate swap contract | Derivatives Designated as Hedging Instruments | Other assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 238 | 0 |
Interest rate swap contract | Derivatives Designated as Hedging Instruments | Accrued liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 0 | (38) |
Foreign currency forward contracts | Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 390 | 0 |
Foreign currency forward contracts | Not Designated as Hedging Instrument | Prepaids and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | $ 390 | $ 0 |
Derivatives - Effect On Condens
Derivatives - Effect On Condensed Consolidated Statements of Operations (Details) - Interest rate swap contract - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Derivatives Designated as Hedging Instruments | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Fair value of liability derivatives | $ 372 | $ (38) | |
Derivatives Designated as Hedging Instruments | Cash Flow Hedging | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (loss) recognized in other comprehensive income before reclassifications | 80 | (450) | $ 0 |
Derivatives Designated as Hedging Instruments | Cash Flow Hedging | Interest expense | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Loss reclassified from accumulated other comprehensive income to earnings for the effective portion | (207) | (626) | 0 |
Derivatives Designated as Hedging Instruments | Cash Flow Hedging | Income tax expense | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Income tax benefit | 47 | 200 | 0 |
Not Designated as Hedging Instrument | Cash Flow Hedging | Income tax expense | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Income tax benefit | 86 | 0 | 0 |
Not Designated as Hedging Instrument | Cash Flow Hedging | Other, net | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Loss recognized in earnings | (382) | 0 | $ 0 |
Accrued liabilities | Derivatives Designated as Hedging Instruments | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Fair value of liability derivatives | $ 0 | $ (38) |
Trade Receivables (Details)
Trade Receivables (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Receivables [Abstract] | |||
Trade receivables | $ 42,804 | $ 45,628 | |
Allowance for doubtful accounts | (119) | (170) | |
Total trade receivable | 42,685 | 45,458 | |
Allowance for Doubtful Accounts Receivable [Roll Forward] | |||
Balance, January 1 | 170 | 918 | $ 108 |
Charges to bad debt expense | 311 | 289 | 786 |
Recoveries (write-offs), net | (362) | (1,037) | 24 |
Balance, December 31 | $ 119 | $ 170 | $ 918 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 48,771 | $ 43,130 |
Parts and components | 4,583 | 3,900 |
Total inventories | $ 53,354 | $ 47,030 |
Property, Plant and Equipment (
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 39,114 | $ 45,517 | |
Accumulated depreciation | (23,287) | (28,049) | |
Total property, plant and equipment, net | 15,827 | 17,468 | |
Depreciation expense | 5,387 | 4,320 | $ 2,558 |
Automobiles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 23 | 139 | |
Automobiles [Member] | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 5 years | ||
Automobiles [Member] | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 6 years | ||
Leasehold improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 3,542 | 3,388 | |
Leasehold improvements [Member] | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 4 years | ||
Leasehold improvements [Member] | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 20 years | ||
Computer equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 17,024 | 25,899 | |
Computer equipment [Member] | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 3 years | ||
Computer equipment [Member] | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 7 years | ||
Machinery and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 15,178 | 13,085 | |
Machinery and equipment [Member] | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 3 years | ||
Machinery and equipment [Member] | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 5 years | ||
Furniture and fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 2,295 | 2,238 | |
Furniture and fixtures [Member] | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 5 years | ||
Furniture and fixtures [Member] | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 20 years | ||
Work in progress [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 1,052 | $ 768 |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill [Roll Forward] | |||
Balance | $ 61,888 | $ 60,470 | $ 2,520 |
Currency exchange rate adjustment | 142 | 70 | (407) |
Goodwill, Purchase Accounting Adjustments | 1,348 | ||
Measurement period adjustments (Note 2) | 58,357 | ||
Balance | 62,030 | 61,888 | 60,470 |
Direct | |||
Goodwill [Roll Forward] | |||
Balance | 2,180 | 2,113 | 2,520 |
Currency exchange rate adjustment | 155 | 67 | (407) |
Goodwill, Purchase Accounting Adjustments | 0 | ||
Measurement period adjustments (Note 2) | 0 | ||
Balance | 2,335 | 2,180 | 2,113 |
Retail | |||
Goodwill [Roll Forward] | |||
Balance | 59,708 | 58,357 | 0 |
Currency exchange rate adjustment | (13) | 3 | 0 |
Goodwill, Purchase Accounting Adjustments | 1,348 | ||
Measurement period adjustments (Note 2) | 58,357 | ||
Balance | $ 59,695 | $ 59,708 | $ 58,357 |
Other Intangible Assets (Detail
Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Indefinite life trademarks | $ 23,252 | $ 32,052 | |
Intangible Assets, Gross (Excluding Goodwill) | 65,739 | 90,839 | |
Accumulated amortization - patents | (7,996) | (21,039) | |
Total other intangible assets, net | 57,743 | 69,800 | |
Amortization expense for intangible assets | 3,256 | 3,554 | $ 854 |
2,018 | 3,164 | ||
2,019 | 3,134 | ||
2,020 | 3,108 | ||
2,021 | 3,078 | ||
2,022 | 3,078 | ||
Thereafter | 18,929 | ||
Finite-Lived Intangible Assets, Net | 34,491 | ||
Definite-lived trademarks | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets, gross | 2,600 | 2,600 | |
Patents | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets, gross | 15,187 | 31,487 | |
Customer relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets, gross | $ 24,700 | $ 24,700 | |
Minimum | Definite-lived trademarks | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible asset, useful life | 10 years | ||
Minimum | Patents | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible asset, useful life | 8 years | ||
Minimum | Customer relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible asset, useful life | 10 years | ||
Maximum | Definite-lived trademarks | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible asset, useful life | 15 years | ||
Maximum | Patents | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible asset, useful life | 24 years | ||
Maximum | Customer relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible asset, useful life | 15 years |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Accrued Liabilities [Abstract] | ||
Payroll and benefits | $ 3,659 | $ 4,579 |
Other | 7,105 | 8,313 |
Accrued liabilities | $ 10,764 | $ 12,892 |
Product Warranties (Details)
Product Warranties (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Movement in Product Warranty Liability [Roll Forward] | |||
Beginning Balance | $ 7,450 | $ 8,545 | $ 2,246 |
Accruals | 3,008 | 2,480 | 2,302 |
Payments | (4,341) | (3,575) | (1,553) |
Business acquisition (Note 2) | 0 | 0 | 5,550 |
Ending Balance | $ 6,117 | $ 7,450 | $ 8,545 |
Borrowings (Loan Agreement) (De
Borrowings (Loan Agreement) (Details) | Dec. 31, 2017USD ($) |
Line of Credit Facility [Line Items] | |
Maximum revolving secured credit line | $ 20,000,000 |
Borrowing rate under agreement, at period end | 2.35% |
Avaiable for borrowing under line of credit | $ 20,000,000 |
2,018 | 16,000,000 |
2,019 | 16,000,000 |
2,020 | 16,000,000 |
Long-term Debt | 48,000,000 |
Line of Credit | JPMorgan Chase Bank, N.A. | Term Loan | |
Line of Credit Facility [Line Items] | |
Maximum revolving secured credit line | 80,000,000 |
Amount outstanding | $ 48,000,000 |
Income Taxes - Income (Loss) Be
Income Taxes - Income (Loss) Before Tax (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
United States | $ 34,259 | $ 50,651 | $ 39,242 |
Non-U.S. | 1,446 | 930 | 780 |
Income from continuing operations before income taxes | $ 35,705 | $ 51,581 | $ 40,022 |
Income Taxes - Expense (Details
Income Taxes - Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||
U.S. federal | $ 14,409 | $ 6,765 | $ 858 |
U.S. state | 1,887 | 318 | 171 |
Non-U.S. | 330 | 118 | 355 |
Total current | 16,626 | 7,201 | 1,384 |
Deferred: | |||
U.S. federal | (9,418) | 8,130 | 11,324 |
U.S. state | 819 | 1,037 | 573 |
Non-U.S. | 53 | 112 | (62) |
Total deferred | (8,546) | 9,279 | 11,835 |
Total income tax expense (benefit) | $ 8,080 | $ 16,480 | $ 13,219 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Components of Deferred Tax Assets and Liabilities [Abstract] | ||
Accrued liabilities | $ 3,000 | $ 5,089 |
Allowance for doubtful accounts | 12 | 40 |
Inventory valuation | 254 | 199 |
Capitalized indirect inventory costs | 383 | 497 |
Stock-based compensation expense | 897 | 1,346 |
Deferred rent | 588 | 865 |
Accrued royalty | 0 | 429 |
Net operating loss carryforward | 1,715 | 2,377 |
Basis difference on long-lived assets | 548 | 1,052 |
Credit carryforward | 634 | 615 |
Other | 179 | 140 |
Total deferred income tax assets before valuation allowance | 8,210 | 12,649 |
Valuation allowance | (914) | (886) |
Total deferred income tax assets, net of valuation allowance | 7,296 | 11,763 |
Prepaid advertising | (370) | (1,302) |
Other prepaids | (610) | (744) |
Basis difference of long-lived assets | (14,856) | (26,215) |
Undistributed earnings of foreign subsidiaries | 0 | (457) |
Other | (18) | (25) |
Deferred income tax liabilities | (15,854) | (28,743) |
Net deferred income tax liabilities | (8,558) | $ (16,980) |
Domestic Tax Authority [Member] | Loss and Other Credit Carryforward [Member] | ||
Components of Deferred Tax Assets and Liabilities [Abstract] | ||
Valuation allowance | $ (700) |
Income Taxes - Deferred Tax Lia
Income Taxes - Deferred Tax Liability (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Net Deferred Income Tax Liability [Abstract] | ||
Deferred income tax assets, non-current | $ 0 | $ 11 |
Non-current deferred income tax liabilities | (8,558) | (16,991) |
Net deferred income tax liabilities | $ (8,558) | $ (16,980) |
Income Taxes - Reconciliation (
Income Taxes - Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Operating Loss Carryforwards [Line Items] | ||||
U.S. statutory income tax rate | 35.00% | 35.00% | 35.00% | |
State tax, net of U.S. federal tax benefit | 5.00% | 2.40% | 2.60% | |
Non-U.S. income taxes | (0.10%) | 0.30% | (0.10%) | |
Nondeductible incentive stock option expense | 0.80% | 0.30% | 0.80% | |
Research and development credit | (1.50%) | (1.00%) | (0.60%) | |
Change in deferred tax measurement rate | (15.30%) | (0.10%) | 0.00% | |
Change in uncertain tax positions | 0.80% | (5.10%) | 1.10% | |
Excess tax benefits from stock plans | (2.10%) | 0.00% | 0.00% | |
Valuation allowance | 0.10% | 0.20% | (5.80%) | |
Other | (0.10%) | (0.10%) | 0.00% | |
Effective income tax rate for continuing operations | 22.60% | 31.90% | 33.00% | |
Tax Cuts And Jobs Act Of 2017, incomplete accounting, change in tax rate, deferred tax asset, provisional income tax expense | $ 5,600 | |||
Valuation allowance | 914 | $ 914 | $ 886 | |
Loss and Other Credit Carryforward [Member] | Domestic Tax Authority [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Valuation allowance | 700 | 700 | ||
Loss and Other Credit Carryforward [Member] | Foreign Tax Authority [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Valuation allowance | $ 200 | $ 200 |
Income Taxes - Carryforwards (D
Income Taxes - Carryforwards (Details) $ in Millions | Dec. 31, 2017USD ($) |
State | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforwards | $ 32 |
Income tax credit carryforwards | 0.9 |
Switzerland | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforwards | $ 0.8 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||||
Unrecognized tax benefits, beginning of year | $ 1,970 | $ 2,519 | $ 2,768 | |
Additions for tax positions taken in prior years | $ 2,700 | 38 | 21 | 1 |
Reductions for tax positions taken in prior years | (5) | (523) | (426) | |
Additions for tax positions related to the current year | 211 | 83 | 43 | |
Other | (9) | 0 | 133 | |
Lapses of statutes of limitations | (11) | (130) | 0 | |
Unrecognized tax benefits, end of year | 2,194 | 1,970 | 2,519 | |
Unrecognized tax benefits that would impact effective tax rate, if recognized | 2,000 | |||
Unrecognized Tax Benefits, Income Tax Penalties and Interest Expense | 300 | (1,900) | $ 500 | |
Cumulative liability for interest and penalties related to uncertain tax positions | 1,000 | $ 700 | ||
Previously unrecognized tax benefit likely to be recognized within the next 12 months | $ 800 |
Accumulated Other Comprehensi80
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | $ 160,857 | $ 126,991 | $ 111,072 |
Other comprehensive income (loss) | 958 | 110 | (1,019) |
Ending balance | 179,189 | 160,857 | 126,991 |
Unrealized Gain (Loss) on Available-for-Sale Securities | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | (8) | (16) | (18) |
Current period other comprehensive income (loss) before reclassifications | (56) | 8 | 2 |
Reclassification of amounts to earnings | 0 | 0 | |
Other comprehensive income (loss) | (56) | 8 | |
Ending balance | (64) | (8) | (16) |
Gain (loss) on Derivative Securities | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | (24) | 0 | 0 |
Current period other comprehensive income (loss) before reclassifications | 80 | (450) | 0 |
Reclassification of amounts to earnings | 160 | 426 | |
Other comprehensive income (loss) | 240 | (24) | |
Ending balance | 216 | (24) | 0 |
Foreign Currency Translation Adjustments | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | (1,185) | (1,311) | (290) |
Current period other comprehensive income (loss) before reclassifications | 774 | 126 | (1,021) |
Reclassification of amounts to earnings | 0 | 0 | |
Other comprehensive income (loss) | 774 | 126 | |
Ending balance | (411) | (1,185) | (1,311) |
Accumulated Other Comprehensive Income (Loss) | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | (1,217) | (1,327) | (308) |
Current period other comprehensive income (loss) before reclassifications | 798 | (316) | (1,019) |
Reclassification of amounts to earnings | 160 | 426 | |
Other comprehensive income (loss) | 958 | 110 | |
Ending balance | $ (259) | $ (1,217) | $ (1,327) |
Stock-Based Compensation (Detai
Stock-Based Compensation (Detail) - shares | 12 Months Ended | |
Dec. 31, 2017 | Apr. 28, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock, shares reserved for future issuance | 4,900,000 | |
2015 Long-Term Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares authorized | 4,800,000 | |
Reduction in number of shares available for issuance due to settlement of stock appreciation rights and stock unit or performance unit award | 2 | |
Reduction in number of shares available for issuance due to settlement of stock option award | 1 | |
Shares available for issuance | 4,200,000 | |
Maximum aggregate shares of common stock subject to stock options, appreciation rights, restricted stock or performance stock unit awards | 1,000,000 | |
Stock options | 2015 Long-Term Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected life (years) | 7 years | |
Stock options | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 3 years | |
Stock options | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 4 years |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Options (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Stock Option Activity and Outstanding Options | |||
Options outstanding | 433 | ||
Forfeited, cancelled or expired | (1) | ||
Exercised | (135) | ||
Options outstanding | 297 | 433 | |
Stock Option Activity and Weighted-Average Exercise Price | |||
Beginning of period, Weighted Average Exercise Price (in dollars per share) | $ 5.03 | ||
Forfeited, canceled or expired, Weighted Average Exercise Price (in dollars per share) | 15.58 | ||
Exercises, Weighted Average Exercise Price (in dollars per share) | 4.15 | ||
End of period, Weighted Average Exercise Price (in dollars per share) | $ 5.37 | $ 5.03 | |
Options outstanding, Aggregate Intrinsic Value | $ 2,405 | ||
Options outstanding, Weighted-Average Remaining Contractual Life | 2 years 1 month 6 days | ||
Options exercisable, Number of Options Exercisable | 291 | ||
Options exercisable, Weighted-Average Exercise Price | $ 5.19 | ||
Options exercisable, aggregate intrinsic value | $ 2,401 | ||
Options exercisable, Weighted average remaining contractual term | 2 years | ||
Vested and expected to vest | 297 | ||
Vested and expected to vest, Weighted Average Exercise Price | $ 5.37 | ||
Vested and expected to vest, Aggregate Intrinsic Value | $ 2,405 | ||
Vested and expected to vest, remaining contractual term (in years) | 2 years 1 month 6 days | ||
General and administrative | $ 1,856 | $ 2,613 | $ 1,484 |
Weighted average grant-date fair value of stock options granted | $ 0 | $ 0 | $ 8.94 |
Stock options | |||
Stock Option Activity and Weighted-Average Exercise Price | |||
General and administrative | $ 84 | $ 389 | $ 327 |
Compensation expense for unvested stock options | $ 2,600 | ||
Minimum | Stock options | |||
Stock Option Activity and Weighted-Average Exercise Price | |||
Weighted average period for unvested stock options | 4 months 24 days | ||
Maximum | Stock options | |||
Stock Option Activity and Weighted-Average Exercise Price | |||
Weighted average period for unvested stock options | 1 year 3 months 18 days |
Stock-Based Compensation - St83
Stock-Based Compensation - Stock-based Compensation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
General and administrative | $ 1,856 | $ 2,613 | $ 1,484 |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
General and administrative | 84 | 389 | 327 |
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
General and administrative | 287 | 168 | 0 |
Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
General and administrative | 954 | 734 | 544 |
Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
General and administrative | 408 | 1,211 | 575 |
Employee Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
General and administrative | $ 123 | $ 111 | $ 38 |
Stock-Based Compensation- RSU a
Stock-Based Compensation- RSU and RSA Activity (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Restricted Stock Awards | |
Restricted Stock Units Activity and Outstanding | |
Outstanding, beginning of period | shares | 44 |
Granted | shares | 17 |
Vested (in shares) | shares | (14) |
Outstanding, end of period | shares | 47 |
Restricted Stock Units Activity and Weighted Average Grant Date Fair Value per Share | |
Beginning of period, Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | $ 16.31 |
Granted, Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | 17.60 |
Vested, Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | 17.91 |
End of period, Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | $ 16.28 |
Restricted Stock Units | |
Restricted Stock Units Activity and Outstanding | |
Outstanding, beginning of period | shares | 109 |
Granted | shares | 108 |
Forfeited | shares | (24) |
Vested (in shares) | shares | (2) |
Outstanding, end of period | shares | 191 |
Restricted Stock Units Activity and Weighted Average Grant Date Fair Value per Share | |
Beginning of period, Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | $ 18.17 |
Granted, Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | 16.94 |
Forfeited, Weighted Average Grante Date Fair Value (in dollars per share) | $ / shares | 17.78 |
Vested, Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | 19.07 |
End of period, Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | $ 17.64 |
Stock-Based Compensation - Perf
Stock-Based Compensation - Performance Stock Units (Details) - Performance Shares - $ / shares | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||
Feb. 28, 2017 | Feb. 29, 2016 | Dec. 31, 2015 | Feb. 28, 2014 | Sep. 30, 2015 | Dec. 31, 2017 | |
Performance Stock Units Activity and Outstanding | ||||||
Outstanding, beginning of period | 264,000 | |||||
Granted | 113,000 | |||||
Forfeited | (81,000) | |||||
Vested (in shares) | (124,000) | |||||
Outstanding, end of period | 172,000 | |||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Beginning of period, Weighted Average Grant Date Fair Value (in dollars per share) | $ 14.66 | |||||
Granted, Weighted Average Grant Date Fair Value (in dollars per share) | 13.84 | |||||
Forfeited, Weighted Average Grante Date Fair Value (in dollars per share) | 16.99 | |||||
Vested, Weighted Average Grant Date Fair Value (in dollars per share) | 8.23 | |||||
End of period, Weighted Average Grant Date Fair Value (in dollars per share) | $ 17.65 | |||||
February 2014 PSU Awards | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Outstanding | ||||||
Granted | 82,494 | |||||
Vested (in shares) | (123,739) | |||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting period | 3 years | |||||
February 2014 PSU Awards | Minimum | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting percentage | 60.00% | |||||
February 2014 PSU Awards | Maximum | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting percentage | 150.00% | |||||
April And September 2015 PSU Awards | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Outstanding | ||||||
Granted | 56,820 | |||||
Outstanding, end of period | 44,900 | |||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting period | 3 years | |||||
April And September 2015 PSU Awards | Minimum | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting percentage | 60.00% | |||||
April And September 2015 PSU Awards | Maximum | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting percentage | 150.00% | |||||
February 2016 PSU Awards | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Outstanding | ||||||
Granted | 54,818 | |||||
Outstanding, end of period | 48,600 | |||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting period | 3 years | |||||
February 2016 PSU Awards | Minimum | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting percentage | 60.00% | |||||
February 2016 PSU Awards | Maximum | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting percentage | 150.00% | |||||
December 2015 PSU Awards | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Outstanding | ||||||
Granted | 117,230 | |||||
Outstanding, end of period | 13,600 | |||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting period | 3 years | |||||
December 2015 PSU Awards | Minimum | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting percentage | 60.00% | |||||
December 2015 PSU Awards | Maximum | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting percentage | 150.00% | |||||
February 2017 PSU Awards | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Outstanding | ||||||
Granted | 72,017 | |||||
Outstanding, end of period | 65,100 | |||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting period | 3 years | |||||
February 2017 PSU Awards | Minimum | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting percentage | 60.00% | |||||
February 2017 PSU Awards | Maximum | Key Executive Employees Member | ||||||
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ||||||
Vesting percentage | 150.00% |
Stock-Based Compensation Stock
Stock-Based Compensation Stock Compensation, Other (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average grant-date fair value of stock options granted | $ 0 | $ 0 | $ 8.94 |
Total intrinsic value of stock options exercised | $ 1,522 | $ 1,221 | $ 4,142 |
Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Fair value of units vested | 28 | 311 | 673 |
Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Fair value of units vested | $ 2,036 | $ 574 | $ 1,454 |
Stock-Based Compensation Fair V
Stock-Based Compensation Fair Value Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Employee Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield | 0.00% | 0.00% | 0.00% |
Risk-free interest rate | 0.80% | 0.40% | 0.10% |
Expected volatility | 44.00% | 56.00% | 43.00% |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield | 0.00% | ||
Risk-free interest rate | 1.60% | ||
Expected life (years) | 4 years 3 months 10 days | ||
Expected volatility | 71.00% |
Stock-Based Compensation - Empl
Stock-Based Compensation - Employee Stock Purchase Plan (Details) - Employee Stock - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Apr. 28, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares available for issuance | 432 | 469 | |
Discount from market price, offering date | 90.00% | ||
Percentage of outstanding stock maximum | 5.00% | ||
Number of shares authorized | 500 | ||
Employee shares purchased (shares) | (37) | ||
Weighted- Average Purchase Price | $ 13.20 | ||
Weighted-Average Discount per Share | $ 2.19 |
Stock Repurchase Program (Detai
Stock Repurchase Program (Details) - USD ($) | Nov. 03, 2014 | Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | Apr. 25, 2017 | May 04, 2016 |
Class of Stock [Line Items] | ||||||||
Repurchased Amount | $ 11,055,000 | $ 5,390,000 | $ 11,567,000 | |||||
Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Number of Shares | 788,416 | 319,805 | 711,708 | 1,819,929 | ||||
Repurchased Amount | $ 11,054,983 | $ 5,390,355 | $ 11,567,527 | $ 28,012,865 | ||||
Average Price per Share | $ 14.02 | $ 16.86 | $ 16.25 | $ 15.39 | ||||
15 Million Authorization, Expiring November 3, 2016 | Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Stock repurchase program, authorized amount | $ 15,000,000 | |||||||
Stock Repurchase Program, Period in Force | 24 months | |||||||
10 Million Authorization Expansion, Expiring May 4, 2018 | Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Stock repurchase program, authorized amount | $ 10,000,000 | |||||||
Repurchased Amount | 8,100,000 | |||||||
15 Million Authorization, Expiring April 25, 2019 | Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Stock repurchase program, authorized amount | $ 15,000,000 | |||||||
Remaining authorized repurchase amount | $ 12,000,000 | 12,000,000 | $ 12,000,000 | |||||
Repurchased Amount | $ 3,000,000 |
Income Per Share (Details)
Income Per Share (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income per share: | |||
Basic weighted average shares outstanding | 30,671 | 31,032 | 31,288 |
Dilutive potential common shares | 339 | 269 | 301 |
Diluted weighted average shares outstanding | 31,010 | 31,301 | 31,589 |
Stock options | |||
Income per share: | |||
Anti-dilutive securities excluded from computation of diluted income per share | 8 | 8 | 12 |
401(k) Savings Plan (Details)
401(k) Savings Plan (Details) - Other Pension, Postretirement and Supplemental Plans [Member] - 401K Savings Plan - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Percent of employer's match of the employee's first 1% of eligible pay | 100.00% | ||
Percent of employee eligible pay (first 1%) | 1.00% | ||
Percent of employer's match of the employee's next 5% of eligible pay | 50.00% | ||
Percent of employee eligible pay (next 5%) | 5.00% | ||
Maximum employer matching, percent | 3.50% | ||
Annual vesting percentage | 25.00% | ||
Employer's match after two years (fully vested) | 100.00% | ||
Number of years until employer matches 100% | 2 years | ||
401(k) matching contributions | $ 1,056 | $ 1,014 | $ 746 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2017USD ($)segment | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Segment Reporting Information [Line Items] | |||||||||||
Number of operating segments | segment | 2 | ||||||||||
Net sales | $ 127,771 | $ 88,132 | $ 77,029 | $ 113,252 | $ 125,764 | $ 80,818 | $ 78,529 | $ 120,928 | $ 406,184 | $ 406,039 | $ 335,764 |
Consolidated contribution | 65,247 | 75,684 | 56,764 | ||||||||
Operating Expenses | 167,579 | 158,131 | 132,963 | ||||||||
Reconciliation of consolidated contribution to income (loss) from continuing operations: | |||||||||||
Income tax expense | (8,080) | (16,480) | (13,219) | ||||||||
Income from continuing operations | 8,532 | $ 8,342 | $ 2,566 | $ 8,185 | 11,974 | $ 7,845 | $ 3,696 | $ 11,586 | 27,625 | 35,101 | 26,803 |
Depreciation and amortization expense | 8,643 | 7,874 | 3,412 | ||||||||
Assets | 324,776 | 333,066 | 324,776 | 333,066 | |||||||
UNITED STATES | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 352,703 | 353,893 | 295,366 | ||||||||
CANADA | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 25,589 | 26,005 | 33,230 | ||||||||
All Other | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 27,892 | 26,141 | 7,168 | ||||||||
Direct | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 219,440 | 225,057 | 225,595 | ||||||||
Consolidated contribution | 34,900 | 43,215 | 39,940 | ||||||||
Reconciliation of consolidated contribution to income (loss) from continuing operations: | |||||||||||
Depreciation and amortization expense | 1,666 | 1,944 | 868 | ||||||||
Assets | 40,532 | 37,388 | 40,532 | 37,388 | |||||||
Retail | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 183,875 | 177,920 | 106,195 | ||||||||
Consolidated contribution | 27,495 | 29,451 | 12,850 | ||||||||
Reconciliation of consolidated contribution to income (loss) from continuing operations: | |||||||||||
Depreciation and amortization expense | 4,606 | 4,775 | 757 | ||||||||
Assets | 192,064 | 206,580 | 192,064 | 206,580 | |||||||
Unallocated royalty income [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 2,869 | 3,062 | 3,974 | ||||||||
Consolidated contribution | 2,852 | 3,018 | 3,974 | ||||||||
Unallocated corporate [Member] | |||||||||||
Reconciliation of consolidated contribution to income (loss) from continuing operations: | |||||||||||
Depreciation and amortization expense | 2,371 | 1,155 | 1,787 | ||||||||
Assets | $ 92,180 | $ 89,098 | 92,180 | 89,098 | |||||||
Less expenses not directly related to segments [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating Expenses | (28,944) | (22,290) | (16,493) | ||||||||
Reconciliation of consolidated contribution to income (loss) from continuing operations: | |||||||||||
Other income (expense), net | (598) | (1,813) | (249) | ||||||||
Income tax expense | $ (8,080) | $ (16,480) | $ (13,219) | ||||||||
Customer Concentration Risk | Sales Revenue, Net | Amazon.com | |||||||||||
Reconciliation of consolidated contribution to income (loss) from continuing operations: | |||||||||||
Net sales outside of the United States, percent of consolidated net sales | 11.90% | 11.30% | 11.10% |
Commitments and Contingencies93
Commitments and Contingencies (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Payments for legal settlements | $ 1.2 | $ 1.2 |
Non-cancelable market-based purchase obligation | $ 19 |
Commitments and Contingencies -
Commitments and Contingencies - Operating Lease (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Rent expense under all operating leases | $ 6,095 | $ 6,561 | $ 5,033 |
2,017 | 5,016 | ||
2,018 | 5,035 | ||
2,019 | 4,983 | ||
2,020 | 4,021 | ||
2,021 | 2,703 | ||
Thereafter | 4,353 | ||
Total minimum non-cancelable lease payments, net | $ 26,111 |
Supplementary Information - Q95
Supplementary Information - Quarterly Results of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net sales | $ 127,771 | $ 88,132 | $ 77,029 | $ 113,252 | $ 125,764 | $ 80,818 | $ 78,529 | $ 120,928 | $ 406,184 | $ 406,039 | $ 335,764 |
Gross profit | 62,444 | 41,315 | 38,378 | 61,745 | 64,102 | 39,217 | 41,862 | 66,344 | 203,882 | 211,525 | 173,234 |
Operating income (loss) | 6,406 | 13,365 | 3,849 | 12,683 | 19,310 | 8,211 | 6,573 | 19,300 | 36,303 | 53,394 | 40,271 |
Income from continuing operations | 8,532 | 8,342 | 2,566 | 8,185 | 11,974 | 7,845 | 3,696 | 11,586 | 27,625 | 35,101 | 26,803 |
Income (loss) from discontinued operation | (88) | (101) | (77) | (1,092) | (364) | (251) | (166) | (142) | (1,358) | (923) | (201) |
Net income | $ 8,444 | $ 8,241 | $ 2,489 | $ 7,093 | $ 11,610 | $ 7,594 | $ 3,530 | $ 11,444 | $ 26,267 | $ 34,178 | $ 26,602 |
Basic (in dollars per share) | $ 0.28 | $ 0.27 | $ 0.08 | $ 0.23 | $ 0.38 | $ 0.24 | $ 0.11 | $ 0.37 | $ 0.86 | $ 1.10 | $ 0.85 |
Diluted (in dollars per share) | $ 0.27 | $ 0.27 | $ 0.08 | $ 0.23 | $ 0.37 | $ 0.24 | $ 0.11 | $ 0.37 | $ 0.85 | $ 1.09 | $ 0.84 |
Asset impairment charge | $ 8,800 | $ 0 | $ 0 | ||||||||
Tax Cuts And Jobs Act Of 2017, incomplete accounting, change in tax rate, deferred tax asset, provisional income tax expense | $ 5,600 | ||||||||||
Payments for legal settlements | $ 1,200 | 1,200 | |||||||||
Additions for tax positions taken in prior years | $ 2,700 | $ 38 | $ 21 | $ 1 |
Subsequent Event (Details)
Subsequent Event (Details) $ in Millions | Feb. 21, 2018USD ($) |
February 2018, 15 Million Share Repurchase Program | Common Stock | Subsequent Event | |
Subsequent Event [Line Items] | |
Stock repurchase program, authorized amount | $ 15 |