Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 30, 2019 | Jul. 31, 2019 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ALJJ | |
Entity Registrant Name | ALJ REGIONAL HOLDINGS INC | |
Entity Central Index Key | 0001438731 | |
Current Fiscal Year End Date | --09-30 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Shell Company | false | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity File Number | 001-37689 | |
Entity Tax Identification Number | 134082185 | |
Entity Address, Address Line One | 244 Madison Avenue | |
Entity Address, Address Line Two | PMB #358 | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10016 | |
City Area Code | 888 | |
Local Phone Number | 486-7775 | |
Entity Common Stock, Shares Outstanding | 41,921,299 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 2,971 | $ 2,000 |
Accounts receivable, net of allowance for doubtful accounts of $132 ($208 at September 30, 2018) | 43,727 | 46,383 |
Inventories, net | 7,488 | 7,656 |
Prepaid expenses and other current assets | 5,684 | 5,504 |
Assets held for sale | 222 | |
Total current assets | 59,870 | 61,765 |
Property and equipment, net | 72,604 | 60,162 |
Goodwill | 56,372 | 56,372 |
Intangible assets, net | 38,530 | 42,400 |
Collateral deposits, less current portion | 695 | 695 |
Deferred tax asset, net | 4,013 | 7,639 |
Other assets | 1,652 | 2,435 |
Total assets | 233,736 | 231,468 |
Current liabilities: | ||
Accounts payable | 12,306 | 12,692 |
Accrued expenses | 15,612 | 14,371 |
Income taxes payable | 370 | 204 |
Deferred revenue and customer deposits | 2,716 | 3,179 |
Current portion of term loans, net of deferred loan costs | 9,091 | 8,595 |
Current portion of capital lease obligations | 2,472 | 2,909 |
Current portion of workers’ compensation reserve | 923 | 1,000 |
Other current liabilities | 69 | 1,003 |
Total current liabilities | 43,559 | 43,953 |
Line of credit, net of deferred loan costs | 13,163 | 8,594 |
Term loans, less current portion, net of deferred loan costs | 75,904 | 74,795 |
Deferred revenue, less current portion | 2,228 | 1,374 |
Workers’ compensation reserve, less current portion | 1,290 | 1,508 |
Capital lease obligations, less current portion | 2,908 | 4,427 |
Other non-current liabilities | 9,125 | 5,289 |
Total liabilities | 148,177 | 139,940 |
Commitments and contingencies (Note 8) | ||
Stockholders’ equity: | ||
Common stock, $0.01 par value; authorized – 100,000 shares; 38,026 and 38,111 shares issued and outstanding at June 30, 2019 and September 30, 2018, respectively | 380 | 381 |
Additional paid-in capital | 279,680 | 279,575 |
Accumulated deficit | (194,501) | (188,428) |
Total stockholders’ equity | 85,559 | 91,528 |
Total liabilities and stockholders’ equity | $ 233,736 | $ 231,468 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 132 | $ 208 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 38,026,000 | 38,111,000 |
Common stock, shares outstanding | 38,026,000 | 38,111,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Statement [Abstract] | ||||
Net revenue | $ 84,225 | $ 89,660 | $ 266,005 | $ 279,719 |
Costs and expenses: | ||||
Cost of revenue | 67,030 | 67,778 | 207,596 | 216,927 |
Selling, general and administrative expense | 18,037 | 21,058 | 52,510 | 59,418 |
Disposal of assets and other gain | 2 | 59 | (221) | (173) |
Total operating expenses | 85,069 | 88,895 | 259,885 | 276,172 |
Operating (loss) income | (844) | 765 | 6,120 | 3,547 |
Other expense: | ||||
Interest expense, net | (2,701) | (2,526) | (8,041) | (7,979) |
Total other expense | (2,701) | (2,526) | (8,041) | (7,979) |
Loss before income taxes | (3,545) | (1,761) | (1,921) | (4,432) |
Provision for income taxes | (3,662) | (1,135) | (4,152) | (4,122) |
Net loss | $ (7,207) | $ (2,896) | $ (6,073) | $ (8,554) |
Loss per share of common stock–basic and diluted | $ (0.19) | $ (0.08) | $ (0.16) | $ (0.23) |
Weighted average shares of common stock outstanding– basic and diluted | 38,026 | 37,921 | 38,034 | 37,801 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Operating activities | ||
Net loss | $ (6,073) | $ (8,554) |
Adjustments to reconcile net loss to cash provided by operating activities: | ||
Depreciation and amortization - cost of revenue | 3,493 | 4,168 |
Depreciation and amortization - selling, general and administrative expense | 11,388 | 10,233 |
Stock-based compensation expense | 556 | 812 |
Provision for bad debts and obsolete inventory | 68 | 232 |
Deferred income taxes | 3,626 | 3,883 |
Litigation loss | 2,910 | |
Disposal of assets and other gain | (221) | (173) |
Amortization of deferred loan costs | 555 | 978 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | 2,685 | 3,936 |
Inventories, net | 71 | 2,612 |
Prepaid expenses, collateral deposits, and other current assets | (180) | 474 |
Other assets | 783 | 1,393 |
Accounts payable | (386) | (619) |
Accrued expenses | 1,539 | (205) |
Income tax payable | 166 | (195) |
Deferred revenue and customer deposits | 391 | (3,291) |
Other current liabilities | (11) | (137) |
Other liabilities | (954) | (535) |
Cash provided by operating activities | 17,496 | 17,922 |
Investing activities | ||
Acquisitions, net of cash acquired | (1,000) | (9,000) |
Proceeds from sales of assets | 317 | 408 |
Capital expenditures | (15,096) | (3,100) |
Cash used for investing activities | (15,779) | (11,692) |
Financing activities | ||
Net proceeds (payments) on line of credit | 4,588 | (2,500) |
Payments on term loans | (7,477) | (11,152) |
Proceeds from term loan | 5,000 | 7,500 |
Proceeds from issuance of common stock | 1,500 | |
Proceeds from stock option exercise | 278 | |
Debt and common stock issuance costs | (552) | (482) |
Payments on capital leases | (2,305) | (2,025) |
Cash used for financing activities | (746) | (6,881) |
Change in cash and cash equivalents | 971 | (651) |
Cash and cash equivalents at beginning of period | 2,000 | 5,630 |
Cash and cash equivalents at end of period | 2,971 | 4,979 |
Cash paid during the period for: | ||
Taxes | 841 | 883 |
Interest | 7,399 | 6,894 |
Non-cash investing and financing activities: | ||
Capital equipment purchases financed with capital leases | 349 | $ 2,914 |
Capital equipment purchases financed with term loan | 4,060 | |
Construction in process funded by landlord tenant improvement allowance | $ 4,572 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] |
Balance, beginning of period at Sep. 30, 2017 | $ 371 | $ 276,478 | $ (181,096) | |
Common stock issued, net of issuance costs | 8 | 2,050 | ||
Stock-based compensation expense - options | 500 | |||
Net loss | $ (8,554) | (8,554) | ||
Balance, end of period at Jun. 30, 2018 | 89,757 | 379 | 279,028 | (189,650) |
Balance, beginning of period at Mar. 31, 2018 | 379 | 278,881 | (186,754) | |
Common stock issued, net of issuance costs | 5 | |||
Stock-based compensation expense - options | 142 | |||
Net loss | (2,896) | (2,896) | ||
Balance, end of period at Jun. 30, 2018 | 89,757 | 379 | 279,028 | (189,650) |
Balance, beginning of period at Sep. 30, 2018 | 91,528 | 381 | 279,575 | (188,428) |
Stock-based compensation expense - options | 252 | |||
Common stock retired | (1) | (147) | ||
Net loss | (6,073) | (6,073) | ||
Balance, end of period at Jun. 30, 2019 | 85,559 | 380 | 279,680 | (194,501) |
Balance, beginning of period at Mar. 31, 2019 | 380 | 279,596 | (187,294) | |
Stock-based compensation expense - options | 84 | |||
Net loss | (7,207) | (7,207) | ||
Balance, end of period at Jun. 30, 2019 | $ 85,559 | $ 380 | $ 279,680 | $ (194,501) |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended |
Jun. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization and Basis of Presentation | ALJ REGIONAL HOLDINGS, INC. AND SUBSIDIARIES Organization ALJ Regional Holdings, Inc. (including subsidiaries, referred to collectively in this Report as “ALJ,” the “Company” or “we”) is a holding company. ALJ’s primary assets as of June 30, 2019 were all of the outstanding capital stock of the following companies: • Faneuil, Inc. (including its subsidiaries, “Faneuil”). • Floors-N-More, LLC, dba, Carpets N’ More (“Carpets”). • Phoenix Color Corp. (including its subsidiaries, “Phoenix”). ALJ has organized its business and corporate structure along the following business segments: Faneuil, Carpets, and Phoenix. ALJ is reported as corporate overhead. Basis of Presentation The interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP, for interim financial information and with the instructions to the Securities and Exchange Commission, or SEC, Form 10-Q and Article 10 of SEC Regulation S-X. They do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. Therefore, these financial statements should be read in conjunction with ALJ’s audited financial statements and notes thereto for the years ended September 30, 2018 and 2017 contained in its Annual Report on Form 10-K, filed with the SEC on December 17, 2018. The Company has made estimates and judgments affecting the amounts reported in its condensed consolidated financial statements and the accompanying notes. Significant estimates and assumptions by management are used for, but are not limited to, revenue recognition, including estimated customer lives, determining the fair value of assets and liabilities, including intangible assets acquired and allocation of acquisition purchase prices, estimated useful lives, recoverability of long-lived and intangible assets, the recoverability of goodwill, the realizability of deferred tax assets, stock-based compensation, the likelihood of material loss as a result of loss contingencies, the allowance for doubtful accounts and inventory reserves, and calculation of insurance reserves. Actual results may differ materially from estimates. The interim financial information is unaudited but reflects all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly ALJ’s results of operations and financial position for the interim period. The results of operations for the three and nine months ended June 30, 2019, are not necessarily indicative of the results expected for future quarters or the full year. For a complete summary of ALJ’s significant accounting policies, please refer to Note 2, “Summary of Significant Accounting Policies,” included with ALJ’s audited financial statements and notes thereto for the years ended September 30, 2018 and 2017 contained in its Annual Report on Form 10-K, filed with the SEC on December 17, 2018. There were no material changes to ALJ’s significant accounting policies during the nine months ended June 30, 2019. |
Recent Accounting Standards
Recent Accounting Standards | 9 Months Ended |
Jun. 30, 2019 | |
Accounting Changes And Error Corrections [Abstract] | |
Recent Accounting Standards | 2. RECENT ACCOUNTING STANDARDS Accounting Standards Not Yet Adopted In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, “ Revenue from Contracts with Customers Principal versus Agent Considerations (Reporting Revenue Gross versus Net), Identifying Performance Obligations and Licensing, Narrow-Scope Improvements and Practical Expedients,” 2017-10, “ Service Concession Arrangements (Topic 853): Determining the Customer of the Operation Services.” ASU 2014-09 will be effective for ALJ on October 1, 2019. ASU 2014-09 allows for two methods of adoption: (a) “full retrospective” adoption, meaning the standard is applied to all periods presented, or (b) “modified retrospective” adoption, meaning the cumulative effect of applying ASU 2014-09 is recognized as an adjustment to the opening retained earnings balance in the year of adoption. ALJ has not yet determined which method it will adopt. As the new standard will supersede substantially all existing revenue guidance, it could impact the timing of ALJ’s revenue and cost of revenue recognition across all business segments. In July 2017, ALJ formed a revenue recognition project team (“Revenue Team”), which included an outside revenue recognition consultant. The Revenue Team completed a revenue recognition adoption roadmap that includes three phases: – Phase I – Phase II – Phase III Because of the nature of the work that remains, ALJ is unable to reasonably estimate the impact of adoption on its consolidated financial statements. However, ALJ anticipates the adoption of ASU 2014-09 will expand its revenue-related disclosures. In February 2016, the FASB issued ASU 2016-02, “ Leases ASU 2016-02 requires lessees to recognize a right-of-use asset and corresponding lease liability for all leases with terms of more than 12 months. Recognition, measurement, and presentation of expenses will depend on classification as either a finance or operating lease. ASU 2016-02 also requires certain quantitative and qualitative disclosures. The provisions of ASU 2016-02 should be applied on a modified retrospective basis. ASU 2016-02 will be effective for ALJ on October 1, 2020. The adoption of ASU 2016-02 will result in a material increase to the Company’s consolidated balance sheets for lease liabilities and right-of-use assets. The Company is currently evaluating the other effects the adoption of ASU 2016-02 will have on its consolidated financial statements and related disclosures. In June 2018, the FASB issued ASU 2018-07, “ Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting This amendment expands the scope of the FASB’s Topic 718, Compensation—Stock Compensation (which currently only includes share-based payments to employees) to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. ALJ does not anticipate the adoption of ASU 2018-07 to significantly impact its consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, “ Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, |
Acquisitions
Acquisitions | 9 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Acquisitions | 3. ACQUISITIONS Printing Components Business On October 2, 2017 (the “Printing Components Business Purchase Date”), Phoenix acquired certain assets and assumed certain liabilities from LSC Communications, Inc. (“LSC”) and Moore-Langen Printing Company, Inc. related to its printing and manufacturing services division in Terre Haute, Indiana. Such assets and liabilities are referred to hereinafter as the “Printing Components Business.” Total purchase price was $10.0 million in cash, subject to customary net working capital adjustments, of which $1.0 million was withheld from the consideration paid at closing and paid in October 2018. The Printing Components Business leverages Phoenix’s existing capabilities and core competencies, strengthens its position in the education markets, and expands revenue into new markets. As part of the Printing Components Business acquisition, Phoenix and LSC entered into a supply agreement (as amended from time to time, the “Supply Agreement”). Pursuant to the Supply Agreement, LSC agreed to purchase from Phoenix its print requirements to continue servicing certain of its customers, buy minimum amounts of certain components from Phoenix, and provide Phoenix with a right of last refusal to supply certain non-component work. Phoenix and ALJ financed the acquisition by borrowing $7.5 million under a term loan with Cerberus, selling an aggregate of $1.5 million of ALJ common stock in a private offering to two investors who are unaffiliated with ALJ, and using $1.0 million cash from the exercise of stock options by Jess Ravich, Executive Chairman of ALJ. ALJ amended its financing agreement with Cerberus to facilitate the term loan. See Note 7. The following schedule reflects the estimated fair value of assets acquired and liabilities assumed on the Printing Components Business Purchase Date and the purchase price details: (in thousands) Purchase Price Balance Sheet Caption Allocation Total current assets $ 1,767 Fixed assets 2,273 Identified intangible asset - supply agreement 4,700 Goodwill 1,408 Total assets 10,148 Total current liabilities (148 ) Purchase price $ 10,000 Break Out of Components of Purchase Price Consideration Term loan (note 7) $ 7,500 Common stock issued (note 9) 1,500 Cash received from exercise of stock option 1,000 Purchase price $ 10,000 The Company accounted for the Printing Components Business acquisition using the purchase method of accounting. Accordingly, the assets and liabilities were recorded at their fair values at the date of acquisition. The excess of the purchase price over the fair value of the tangible and intangible assets acquired and the liabilities assumed was recorded as goodwill. There were no adjustments to the purchase price allocations during the measurement period, which expired one year from the acquisition date. The Printing Components Business recorded $3.2 million and $10.2 million of net revenue during the three and nine months ended June 30, 2019, respectively, and $3.1 million and $11.2 million during the three and nine months ended June 30, 2018, respectively. Because the Printing Components Business was closely aligned with Phoenix’s existing business, including the overlap of customers, its operations were immediately integrated into Phoenix’s operations, and financial metrics other than net revenue were not separately tracked, and therefore, not disclosed. During the three and nine months ended June 30, 2018, the Company incurred $0 and $0.1 million of acquisition-related expenses in connection with the Printing Components Business acquisition, which were expensed to selling, general and administrative expense. |
Concentration Risks
Concentration Risks | 9 Months Ended |
Jun. 30, 2019 | |
Risks And Uncertainties [Abstract] | |
Concentration Risks | 4. CONCENTRATION RISKS Cash The Company maintains its cash balances in accounts, which, at times, may exceed federally insured limits. The Company has not experienced any loss in such accounts and believes there is little exposure to any significant credit risk. Major Customers and Accounts Receivable ALJ did not have any customer with net revenue in excess of 10% of consolidated net revenue. Each of ALJ’s segments had customers that represent more than 10% of their respective net revenue, as described below. Faneuil Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Customer A 14.6 % 16.4 % 14.0 % 15.1 % Customer B 11.3 11.8 10.6 10.5 Customer C ** ** 11.8 11.8 ** Less than 10% of Faneuil net revenue. Trade receivables from these customers totaled $5.9 million on June 30, 2019. As of June 30, 2019, all Faneuil accounts receivable were unsecured. The risk with respect to accounts receivable is mitigated by credit evaluations performed on customers and the short duration of payment terms extended to customers. Carpets Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Customer A 33.6 % 19.9 % 28.9 % 20.5 % Customer B 24.5 27.9 28.4 28.3 Customer C 21.7 19.3 21.3 21.8 Trade receivables from these customers totaled $2.3 million on June 30, 2019. As of June 30, 2019, all Carpets accounts receivable were unsecured. The risk with respect to accounts receivable is mitigated by credit evaluations performed on customers and the short duration of payment terms extended to customers. Phoenix Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Customer A 22.1 % 16.8 % 20.1 % 17.1 % Customer B 17.2 16.7 19.8 18.0 Customer C 13.4 11.4 11.4 ** Customer D 13.0 10.9 12.1 10.4 ** Less than 10% of Phoenix net revenue. Trade receivables from these customers totaled $6.4 million on June 30, 2019. As of June 30, 2019, all Phoenix accounts receivable were unsecured. The risk with respect to accounts receivable is mitigated by credit evaluations performed on customers and the short duration of payment terms extended to customers. Supplier Risk ALJ did not have any suppliers that represented more than 10% of consolidated inventory purchases. However, two of ALJ’s segments had suppliers that represented more than 10% of their respective inventory purchases, as described below. Carpets Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Supplier A 20.9 % ** 17.5 % ** Supplier B 16.7 21.9 20.7 19.2 Supplier C 11.9 22.2 14.6 22.7 Supplier D ** 14.4 ** 13.9 ** Less than 10% of Carpets inventory purchases. If these suppliers were unable to provide materials on a timely basis, Carpets management believes alternative suppliers could provide the required materials with minimal disruption to the business. Phoenix If this supplier was unable to provide materials on a timely basis, Phoenix management believes alternative suppliers could provide the required supplies with minimal disruption to the business. |
Composition of Certain Financia
Composition of Certain Financial Statement Captions | 9 Months Ended |
Jun. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Composition of Certain Financial Statement Captions | 5. COMPOSITION OF CERTAIN FINANCIAL STATEMENT CAPTIONS Accounts Receivable, Net The following table summarizes accounts receivable at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Accounts receivable $ 42,199 $ 42,815 Unbilled receivables 1,660 3,776 Accounts receivable 43,859 46,591 Less: allowance for doubtful accounts (132 ) (208 ) Accounts receivable, net $ 43,727 $ 46,383 Inventories, Net The following table summarizes inventories at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Raw materials $ 4,008 $ 4,017 Semi-finished goods/work in process 2,401 2,298 Finished goods 1,402 1,566 Inventories 7,811 7,881 Less: allowance for obsolete inventory (323 ) (225 ) Inventories, net $ 7,488 $ 7,656 Property and Equipment The following table summarizes property and equipment at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Leasehold improvements $ 31,371 $ 9,334 Machinery and equipment 29,918 24,900 Building and improvements 17,035 16,459 Software 16,039 15,749 Computer and office equipment 12,700 11,319 Land 9,267 9,267 Furniture and fixtures 7,302 3,834 Construction and equipment in process 1,249 10,627 Vehicles 375 342 Property and equipment 125,256 101,831 Less: accumulated depreciation and amortization (52,652 ) (41,669 ) Property and equipment, net $ 72,604 $ 60,162 Property and equipment depreciation and amortization expense, including amounts related to capitalized leased assets, Goodwill The following table summarizes goodwill by reportable segment at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Faneuil $ 21,276 $ 21,276 Carpets 2,555 2,555 Phoenix 32,541 32,541 Goodwill $ 56,372 $ 56,372 Intangible Assets The following table summarizes identified intangible assets at the end of each reporting period: June 30, 2019 September 30, 2018 (in thousands) Gross Accumulated Amortization Net Gross Accumulated Amortization Net Customer relationships $ 34,400 $ (12,491 ) $ 21,909 $ 34,400 $ (10,329 ) $ 24,071 Trade names 10,760 (1,896 ) 8,864 10,760 (1,573 ) 9,187 Supply agreements/contract backlog 10,358 (2,898 ) 7,460 10,358 (1,836 ) 8,522 Internal software 580 (551 ) 29 580 (479 ) 101 Non-compete agreements 520 (252 ) 268 2,330 (1,811 ) 519 Totals $ 56,618 $ (18,088 ) $ 38,530 $ 58,428 $ (16,028 ) $ 42,400 Intangible asset amortization expense was $1.3 million and $1.4 million for the three months ended June 30, 2019 and 2018, respectively, and $3.9 million and $4.1 million for the nine months ended June 30, 2019 and 2018, respectively. The following table presents expected future amortization expense for the remainder (in thousands) Estimated Future Amortization Remainder of Fiscal 2019 $ 1,230 Fiscal 2020 4,800 Fiscal 2021 4,485 Fiscal 2022 4,067 Fiscal 2023 4,067 Thereafter 19,881 Total $ 38,530 Debt The following table summarizes ALJ’s line of credit, term loan, and equipment financing at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Line of credit: Line of credit $ 13,327 $ 8,739 Less: deferred loan costs (164 ) (145 ) Line of credit, net of deferred loan costs $ 13,163 $ 8,594 Current portion of term loans: Current portion of term loan $ 8,200 $ 9,470 Current portion of equipment financing 1,319 — Less: deferred loan costs (428 ) (875 ) Current portion of term loans, net of deferred loan costs $ 9,091 $ 8,595 Term loans, less current portion: Term loans, less current portion $ 74,933 $ 75,504 Equipment financing, less current portion 2,105 — Less: deferred loan costs (1,134 ) (709 ) Term loans, less current portion, net of deferred loan costs $ 75,904 $ 74,795 Accrued Expenses The following table summarizes accrued expenses at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Accrued compensation and related taxes $ 7,138 $ 7,275 Professional fees and other 2,642 1,123 Call center buildout 2,099 2,700 Rebates payable 1,485 1,491 Interest payable 763 676 Medical and benefit-related payables 730 609 Accrued board of director fees 521 130 Deferred rent 120 174 Sales tax payable 114 193 Total accrued expenses $ 15,612 $ 14,371 Workers’ Compensation Reserve Faneuil Carpets Phoenix. |
Loss Per Share
Loss Per Share | 9 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Loss Per Share | 6. LOSS PER SHARE The following table summarizes basic and diluted loss per share of common stock for each period presented: Three Months Ended June 30, Nine Months Ended June 30, ( in thousands, except per share amounts 2019 2018 2019 2018 Net loss $ (7,207 ) $ (2,896 ) $ (6,073 ) $ (8,554 ) Weighted average shares of common stock outstanding - basic and diluted 38,026 37,921 38,034 37,801 Loss per share of common stock–basic and diluted $ (0.19 ) $ (0.08 ) $ (0.16 ) $ (0.23 ) ALJ computed basic loss per share of common stock using net loss divided by the weighted average number of shares of common stock outstanding during the period. ALJ computed diluted loss per share of common stock using net loss divided by the weighted average number of shares of common stock outstanding plus potentially dilutive shares of common stock outstanding during the period. Potentially dilutive shares issuable upon exercise of options to purchase common stock were determined by applying the treasury stock method to the assumed exercise of outstanding stock options. Stock options to purchase less than 1.7 million and 1.6 million shares of common stock were not considered in calculating ALJ’s diluted loss per common share for the three and nine months ended June 30, 2019, and the three and nine months ended June 30, 2018, respectively, as their effect would be anti-dilutive. |
Debt
Debt | 9 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt | 7. DEBT Term Loan and Line of Credit In August 2015, ALJ entered into a financing agreement (“Financing Agreement”) with Cerberus Business Finance, LLC (“Cerberus”), to borrow $105.0 million in a term loan (“Cerberus Term Loan”) and have available up to $30.0 million in a revolving loan (“Cerberus/PNC Revolver,” and together with the Cerberus Term Loan, the “Cerberus Debt”). ALJ has subsequently entered into four amendments to the Financing Agreement. Fourth Amendment to Financing Agreement On November 28, 2018, ALJ entered into the Fourth Amendment (the “Fourth Amendment”) to the Financing Agreement. The Fourth Amendment added a $5.0 million term loan, reduced the maximum availability of the Cerberus/PNC Revolver by $5.0 million to $25.0 million from $30.0 million, extended the maturity date to December 1, 2023 (“Amended Maturity Date”), and effective December 31, 2018, reduced quarterly term loan amortization payments from $2.3 million to $2.1 million. The Fourth Amendment amends certain terms and covenants to support the continued growth of the Company and the associated cash required to build out three new customer call centers to position Faneuil for anticipated increased contract awards, as summarized below: • an easing of the fixed charge coverage ratio financial covenant from 1.25:1.00 to (a) 1.05:1.00 for each quarter beginning with the quarter ended December 31, 2018 through the quarter ending September 30, 2020 and (b) 1.10:1.00 for the quarter beginning with the quarter ending December 31, 2020 and for each quarter thereafter; and • a stepdown in the leverage ratio financial covenant from (a) 3.50:1.00 for each quarter beginning with the quarter ended December 31, 2018 through the quarter ending September 30, 2020, to (b) 3.25:1.00 for each quarter beginning with the quarter ending December 31, 2020 through the quarter ending September 30, 2021, (c) 3.00:1.00 for each quarter beginning with the quarter ending December 31, 2021 through the quarter ending September 30, 2022 and (d) 2.75:1.00 for each quarter beginning with the quarter ending December 31, 2022 and for each quarter thereafter. In addition, the Fourth Amendment requires the Company, under certain circumstances, to secure not less than $5.0 million of equity or subordinated debt financing, which will be used to pay down the Cerberus Term Loan (the “Alternative Financing Requirement”). See Backstop Letter Agreement The Financing Agreement and amendments thereto are summarized below ( in thousands Description Use of Proceeds Origination Date Interest Rate * Quarterly Payments Balance at June 30, 2019 Term Loan: Financing Agreement Phoenix acquisition August 2015 9.00% to 9.28% $ 1,610 $ 65,283 First Amendment Color Optics acquisition July 2016 9.00% to 9.28% 175 7,111 Third Amendment Printing Components Business acquisition October 2017 9.00% to 9.28% 151 6,102 Fourth Amendment Working capital November 2018 9.00% to 9.28% 114 4,637 Totals $ 2,050 $ 83,133 Line of Credit: Cerberus/PNC Revolver (includes Second Amendment) Working capital August 2015 11.00% to 11.25% $ — $ 13,327 * Range of annual interest rates accrued during the nine months ended June 30, 2019. Interest payments are due in arrears on the first day of each month. Quarterly principal payments are due on the last day of each fiscal quarter. Annual principal payments equal to 75% of ALJ’s excess cash flow (“ECF”), as defined in the Financing Agreement, are due upon delivery of the annual audited financial statements. During December 2018 and December 2017, ALJ made ECF payments of $0.3 million and $4.1 million, respectively. During the nine months ended June 30, 2019, ALJ made mandatory payments of $0.4 million as a result of receiving proceeds from sales of assets. A final balloon payment is due on the Amended Maturity Date. There is a prepayment penalty equal to 3%, 2%, and 1% if the Cerberus Term Loan is repaid within the first, second, and third year anniversary of the Fourth Amendment. ALJ may make payments of up to $7.0 million against the loan with no penalty. The Cerberus Debt is secured by substantially all the Company’s assets and imposes certain limitations on the Company, including its ability to incur debt, grant liens, initiate certain investments, declare dividends and dispose of assets. The Cerberus Debt also requires ALJ to comply with certain debt covenants. As of June 30, 2019, ALJ was in compliance with all debt covenants and had unused borrowing capacity of $8.5 million. Backstop Letter Agreement On November 28, 2018, in connection with the Fourth Amendment, the Company entered into a Backstop Letter Agreement with Jess Ravich, the Company’s Executive Chairman. Pursuant to the Backstop Letter Agreement, Mr. Ravich will provide a “backstop” that would enable the Company to satisfy the Alternative Financing Requirement by agreeing, if the Company is unable to locate alternative financing on terms, conditions and timing reasonably acceptable to it, and if required by the Collateral Agent. In consideration of Mr. Ravich entering into such backstop arrangement, the Company’s Audit Committee and independent directors reviewed, approved and agreed to a backstop fee package, pursuant to which the Company would (i) pay to Mr. Ravich’s trust a one-time backstop fee of $0.1 million, and (ii) if the purchase of such subordinated debt is required by the Collateral Agent and the Company has failed to secure a financing alternative more advantageous to the Company, issue to Mr. Ravich’s trust a five-year warrant (the “Warrant”) to purchase 1.5 million shares of ALJ common stock at an exercise price equal to the average closing price of the Company’s common stock as reported on The Nasdaq Stock Market for the 30 trading days preceding the warrant issuance date. In February 2019, the Company determined that the possibility of the conditions set forth in the Backstop Letter Agreement requiring the issuance of the Warrant by the Company to Mr. Ravich’s trust were remote. Initially, ALJ recorded the backstop fee and other fees incurred in connection with the Backstop Letter Agreement, which totaled approximately $0.1 million, as a current asset. ALJ expensed the associated fees, which totaled approximately $0.1 million, to selling, general and administrative expense during the nine months ended June 30, 2019 as the likelihood that ALJ would be required to issue the Warrant was deemed remote. Loan Amendment Fees ALJ accounted for the Fourth Amendment as a debt modification pursuant to ASC 470, Debt During the nine months ended June 30, 2018, in connection with the Third Amendment to the Financing Agreement, ALJ paid legal and other fees totaling $0.3 million, which were added to deferred loan costs and are being amortized to interest expense through the Amended Maturity Date. Contingent Loan Costs Pursuant to the Second Amendment to the Financing Agreement, ALJ is required to pay a fee (a “Contingent Payment”) in each of three consecutive annual periods which began on May 27, 2018, if at any time during each annual period there are any amounts outstanding on the Cerberus/PNC Revolver. Such Contingent Payments become due and payable on the first day within each annual period there is an outstanding balance on the Cerberus/PNC Revolver. During May 2018, ALJ paid the first Contingent Payment, which was added to deferred loan costs and was amortized to interest expense through April 30, 2019. During May 2019, ALJ paid the second Contingent Payment, which was added to deferred loan costs and is being amortized to interest expense through April 30, 2020. In July 2019, ALJ entered into the Fifth Amendment to the Financing Agreement. See Note 13. Equipment Financing In December 2018, Phoenix purchased a Heidelberg Press for $4.1 million pursuant to an equipment financing agreement (the “Equipment Financing”). The Equipment Financing term is 36 months, requires monthly principal and interest payments, accrues interest at 4.94% per year, and is secured by the Heidelberg Press. Estimated Future Minimum Principal Payments Estimated future minimum principal payments for the Cerberus Debt and Equipment Financing are as follows ( in thousands Year Ending June 30, Equipment Financing Cerberus Debt Total 2020 $ 1,319 $ 8,200 $ 9,519 2021 1,386 8,200 9,586 2022 719 8,200 8,919 2023 — 8,200 8,200 2024* — 63,660 63,660 Total $ 3,424 $ 96,460 $ 99,884 * The majority of this amount is the final balloon payment due on the Amended Maturity Date. Capital Lease Obligations Faneuil and Phoenix lease equipment under non-cancelable capital leases. As of June 30, 2019, future minimum payments under non-cancelable capital leases with initial or remaining terms of one year or more are as follows ( in thousands Year Ending June 30, Estimated Future Payments 2020 $ 2,650 2021 1,610 2022 647 2023 535 2024 301 Total minimum required payments 5,743 Less: current portion of capital lease obligations (2,472 ) Less: imputed interest (363 ) Capital lease obligations, less current portion $ 2,908 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Jun. 30, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 8. COMMITMENTS AND CONTINGENCIES Operating Leases The Company leases real estate, equipment, and vehicles under non-cancellable operating leases. As of June 30, 2019, future minimum rental commitments and sublease income under non-cancellable leases were as follows ( in thousands Year Ending June 30, Future Minimum Lease Payments Lease Income Net 2020 $ 6,689 $ (499 ) $ 6,190 2021 5,658 — 5,658 2022 4,648 — 4,648 2023 4,375 — 4,375 2024 4,406 — 4,406 Thereafter 19,644 — 19,644 Total $ 45,420 $ (499 ) $ 44,921 Employment Agreements ALJ maintains employment agreements with certain key executive officers that provide for a base salary and an annual bonus, with annual bonus amounts to be determined by the Board of Directors. The agreements also provide for termination payments, which includes base salary, performance bonus, medical premiums, stock options, non-competition provisions, and other terms and conditions of employment. As of June 30, 2019, termination payments related to base salary and medical premiums totaled $1.2 million. In July 2019, ALJ entered into a new employment agreement. See Note 13. Surety Bonds As part of Faneuil’s normal course of operations, certain customers require surety bonds guaranteeing the performance of a contract. As of June 30, 2019, the face value of such surety bonds, which represents the maximum cash payments that Faneuil’s surety would be obligated to pay under certain circumstances of non-performance, was $25.8 million. To date, Faneuil has not made any non-performance payments to any of its sureties. Letters of Credit The Company had letters of credit totaling $3.6 million outstanding as of June 30, 2019. Litigation, Claims, and Assessments Faneuil, Inc. v. 3M Company On September 22, 2016, Faneuil filed a complaint against 3M Company (“3M”) in the Circuit Court for the City of Richmond, Virginia (the “Richmond Circuit Court”). The dispute arose out of a subcontract entered into between 3M and Faneuil in relation to a toll road project in Portsmouth, Virginia. In its complaint, Faneuil sought recovery of $5.1 million based on three causes of action: breach of contract, breach of the implied covenant of good faith and fair dealing, and unjust enrichment. On October 14, 2016, 3M filed its answer and counterclaim against Faneuil. In its counterclaim, 3M sought recovery in excess of $10.0 million based on three claims: breach of contract/indemnification, breach of the implied covenant of good faith and fair dealing, and unjust enrichment. 3M’s counterclaim alleged it incurred approximately $3.2 million in damages payable to ERC as a result of Faneuil’s conduct and sought indemnification of an additional $10.0 million in damages incurred as a result of continued performance under its contract with ERC. The matter was tried in a bench trial from April 30, 2018 through May 2, 2018. On May 15, 2018, the Richmond Circuit Court issued its opinion, which dismissed both Faneuil’s complaint and 3M’s counterclaim with prejudice. No monetary damages were awarded to either Faneuil or 3M. As a result of the Richmond Circuit Court’s opinion, ALJ recorded a non-cash litigation loss of $2.9 million (the outstanding unreserved receivable from 3M), which was included with selling, general and administrative expense during the year ended September 30, 2018. Faneuil has filed an appeal of the Richmond Circuit Court’s judgment. The parties have fully briefed the merits of Faneuil’s appeal and are waiting for the court to set the date for oral argument at this time. Marshall v. Faneuil, Inc. On July 31, 2017, plaintiff Donna Marshall (“Marshall”), filed a proposed class action lawsuit in the Superior Court of the State of California for the County of Sacramento against Faneuil and ALJ. Marshall, a previously terminated Faneuil employee, alleges various California state law employment-related claims against Faneuil. Faneuil has answered the complaint and removed the matter to the United States District Court for the Eastern District of California; however, Marshall filed a motion to remand the case back to state court, which has been granted. In connection with the above, an amended complaint was filed by certain plaintiffs to add a claim for penalties under the California Private Attorneys General Act. The case is in early discovery at this time. Faneuil believes this action is without merit and intends to defend it vigorously. McNeil, et al. v. Faneuil, Inc. Tammy McNeil, a former Faneuil call center employee, filed a Fair Labor Standards Act collective action case against Faneuil in federal court in Newport News, Virginia in 2015. The class action asserted various timekeeping and overtime violations, which Faneuil denied. On June 6, 2017, the case was settled by the parties as part of a court-ordered mediation, for $0.3 million in damages, plus plaintiff’s attorney fees. Because the parties could not agree on the dollar amount of plaintiff’s attorney fees, both parties agreed to allow the court to determine the amount. The court awarded $0.7 million in attorney’s fees and overruled Faneuil’s objections to the recommendation of the magistrate judge relating to that amount. Neither party appealed the decision. All amounts were paid during ALJ’s fiscal year ended September 30, 2018. Other Litigation The Company has including the matters described above) usiness, consolidated financial position, results of operations or cash flows. Environmental Matters The operations of Phoenix are subject to various laws and related regulations governing environmental matters. Under such laws, an owner or lessee of real estate may be liable for the costs of removal or remediation of certain hazardous or toxic substances located on or in, or emanating from, such property, as well as investigation of property damage. Phoenix incurs ongoing expenses associated with the performance of appropriate monitoring and remediation at certain of its locations. |
Equity
Equity | 9 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Equity | 9. EQUITY Common Stock Activity during the Nine Months ended June 30, 2019 ALJ’s common stock activity for the nine months ended June 30, 2019 consisted of the following: • Retired 84,000 shares of common stock, which were received by ALJ as part of a settlement agreement related to Faneuil’s acquisition of certain customer management outsourcing business assets and liabilities (the “CMO Business”) in May 2017. In connection with the settlement, ALJ recognized a $0.1 million gain during the nine months ended June 30, 2019, which was included with disposal of assets and other gain on the statement of operations. In July 2019, ALJ issued additional shares of common stock. See Note 13. Common Stock Activity during the Nine Months ended June 30, 2018 ALJ’s common stock activity for the nine months ended June 30, 2018 consisted of the following: • Sold 477,706 shares of common stock, at $3.14 per share, to two unaffiliated shareholders in connection with financing the Printing Components Business acquisition. See Note 3. • Issued 102,102 shares of common stock to members of ALJ’s Board of Directors as compensation. See “ Common Stock Awards • Issued 300,000 shares of common stock upon exercise of options at a weighted-average exercise price of $0.93 per share. Equity Incentive Plans ALJ’s equity incentive plans are broad-based, long-term programs intended to attract and retain talented employees and align stockholder and employee interests. Stock-Based Compensation. The following table sets forth the total stock-based compensation expense included in selling, general and administrative expense on the statement of operations: Three Months Ended June 30, Nine Months Ended June 30, (in thousands) 2019 2018 2019 2018 Stock options $ 84 $ 142 $ 252 $ 500 Common stock awards 101 107 304 312 Total stock-based compensation expense $ 185 $ 249 $ 556 $ 812 At June 30, 2019, ALJ had approximately $0.4 million of total unrecognized compensation cost related to unvested stock options. This cost is expected to be recognized over a weighted-average period of approximately 1.3 years. Stock Option Awards The “intrinsic value” of options is the excess of the value of ALJ stock over the exercise price of such options. The total intrinsic value of options outstanding (of which all are vested) was less than $0.1 million at June 30, 2019. Common Stock Awards director compensation package that includes an annual common stock award. In connection with such awards, ALJ recorded stock-based compensation expense of |
Income Taxes
Income Taxes | 9 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 10. INCOME TAX ALJ recorded a non-cash deferred income tax expense of $3.6 million during the three and nine months ended June 30, 2019, the majority of which was to increase its deferred tax asset valuation allowance as a result of reduced taxable income projections. The remaining provision for income taxes during the three and nine months ended June 30, 2019, and the three months ended June 30, 2018 was a result of generating state taxable income. ALJ’s provision for income taxes for the nine months ended June 30, 2018 was impacted by the United States Tax Reform as discussed below. United States Tax Reform On December 22, 2017, the President of the United States signed and enacted into law H.R. 1 (the “Tax Reform Law”). The Tax Reform Law, effective for tax years beginning on or after January 1, 2018, resulted in significant changes to existing United States tax law, including various provisions that will impact ALJ. Below is a summary of the provisions of the Tax Reform Law that management believes will be most impactful to ALJ. Federal Corporate Tax Rate Reduction. Interest Expense Limitation. Bonus Depreciation Alternative Minimum Tax Pursuant to ASC Topic 740-10, “ Income Taxes |
Related-Party Transactions
Related-Party Transactions | 9 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | 11. RELATED-PARTY TRANSACTIONS Harland Clarke Holdings Corp. (“Harland Clarke”), a stockholder who owns ALJ shares in excess of five percent, had a contract with Faneuil to provide call center services for Harland Clarke’s banking-related products. The contract completed in March 2019. Faneuil recognized revenue from Harland Clarke totaling $0 and $0.1 million for the three and nine months ended June 30, 2019, and $0.1 million and $0.2 million for the three and nine months ended June 30, 2018, respectively. The associated cost of revenue was $0 and $0.1 million for the three and nine months ended June 30, 2019, and $0.1 million and $0.3 million for the three and nine months ended June 30, 2018, respectively. All revenue from Harland Clarke contained similar terms and conditions as those found in other transactions of this nature entered into by Faneuil. Total accounts receivable from Harland Clarke was $0 and $0.1 million at June 30, 2019 and September 30, 2018, respectively. |
Reportable Segments and Geograp
Reportable Segments and Geographic Information | 9 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Reportable Segments and Geographic Information | 12. REPORTABLE SEGMENTS AND GEOGRAPHIC INFORMATION Reportable Segments As discussed in Note 1, ALJ has organized its business along three reportable segments (Faneuil, Carpets, and Phoenix), together with a corporate group for certain support services. ALJ’s operating segments are aligned on the basis of products, services, and industry. The Chief Operating Decision Maker (“CODM”) is ALJ’s Executive Chairman. The CODM manages the business, allocates resources to, and assesses the performance of each operating segment using information about its net revenue and segment adjusted EBITDA. ALJ defines segment adjusted EBITDA as segment net income (loss) before depreciation and amortization, interest expense, litigation loss, restructuring expenses, lease payments in anticipation of facility shutdown, loan amendment fees, stock-based compensation, acquisition-related expenses, disposal of fixed assets and other gain, provision for income taxes, and other non-recurring items. Such amounts are detailed in our segment reconciliation below. The accounting policies for segment reporting are the same as for ALJ as a whole. The following tables present ALJ’s segment information for the three and nine months ended June 30, 2019 and 2018: Three Months Ended June 30, 2019 ( in thousands Faneuil Carpets Phoenix ALJ Total Net revenue $ 44,773 $ 12,763 $ 26,689 $ — $ 84,225 Segment adjusted EBITDA $ 518 $ 478 $ 4,881 $ (712 ) $ 5,165 Depreciation and amortization (5,598 ) Interest expense (2,701 ) Lease payments in anticipation of facility shutdown (73 ) Stock-based compensation (185 ) Restructuring expenses (66 ) Acquisition-related expenses (85 ) Disposal of assets and other gain (2 ) Provision for income taxes (3,662 ) Net loss $ (7,207 ) Nine Months Ended June 30, 2019 ( in thousands Faneuil Carpets Phoenix ALJ Total Net revenue $ 146,565 $ 37,213 $ 82,227 $ — $ 266,005 Segment adjusted EBITDA $ 8,257 $ 910 $ 15,437 $ (2,092 ) $ 22,512 Depreciation and amortization (14,881 ) Interest expense (8,041 ) Lease payments in anticipation of facility shutdown (517 ) Stock-based compensation (556 ) Loan amendment fees (337 ) Restructuring expenses (225 ) Acquisition-related expenses (97 ) Disposal of assets and other gain 221 Provision for income taxes (4,152 ) Net loss $ (6,073 ) Three Months Ended June 30, 2018 (in thousands) Faneuil Carpets Phoenix ALJ Total Net revenue $ 43,893 $ 18,013 $ 27,754 $ — $ 89,660 Segment adjusted EBITDA $ 3,604 $ 582 $ 6,021 $ (621 ) $ 9,586 Depreciation and amortization (4,718 ) Interest expense (2,526 ) Litigation loss (2,910 ) Restructuring expenses (779 ) Stock-based compensation (249 ) Acquisition-related expenses (106 ) Disposal of assets and other gain (59 ) Provision for income taxes (1,135 ) Net loss $ (2,896 ) Nine Months Ended June 30, 2018 ( in thousands Faneuil Carpets Phoenix ALJ Total Net revenue $ 143,320 $ 53,354 $ 83,045 $ — $ 279,719 Segment adjusted EBITDA $ 10,229 $ (384 ) $ 15,640 $ (1,717 ) $ 23,768 Depreciation and amortization (14,401 ) Interest expense (7,979 ) Litigation loss (2,910 ) Restructuring expenses (2,042 ) Stock-based compensation (812 ) Acquisition-related expenses (229 ) Disposal of assets and other gain 173 Provision for income taxes (4,122 ) Net loss $ (8,554 ) Geographic Information Substantially all of the Company’s assets were located in the United States. Substantially all of the Company’s revenue was earned in the United States. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | 13. SUBSEQUENT EVENTS RDI Acquisition On July 31, 2019, ALJ acquired Realtime Digital Innovations, LLC (the “RDI Acquisition”), an exclusive partner of Faneuil for the past 18 months providing workflow automation and business intelligence services. The RDI Acquisition is expected to provide Faneuil with a sustainable competitive advantage in the business process outsourcing space by allowing it to, among other things, (i) automate process workflows and business intelligence, (ii) generate labor efficiencies for existing programs, (iii) expand potential new client target entry points, (iv) improve overall customer experience, and (v) increase margin profiles through shorter sales cycles and software license sales. The aggregate cash consideration for the RDI Acquisition paid at closing was $2.5 million, with earn-outs up to $7.5 million to be paid upon the achievement of certain financial metrics over a three-year period, subject to a guaranteed payout of $2.5 million. Faneuil plans to consolidate the RDI business under Faneuil’s corporate umbrella. Fifth Amendment to Financing Agreement On July 31, 2019, ALJ entered into the Fifth Amendment (the “Fifth Amendment”) to the Financing Agreement to support the continued growth of the Company and the associated increase in cash capital expenditures for Faneuil’s buildout of three new customer call centers, which will support anticipated growth. The Fifth Amendment included, among other amendments, the following: • The creation of a $7.5 million seasonal revolver facility; • An increase from $15.0 million to $18.5 million of capital expenditures basket allocated for the buildout of Faneuil’s three new customer call centers; • An increase in the leverage ratio threshold from 3.50:1.00 to 3.75:1.00 for the fiscal quarters ended September 30, 2019 and December 31, 2019; and • Updates to certain definitions, representations and warranties to allow for the RDI Acquisition. Common Stock Activity Subsequent to June 30, 2019 ALJ sold 3.9 million shares of common stock at $1.80 per share in connection with financing the RDI acquisition discussed above for total cash proceeds of $7.0 million. Of the common shares sold, 2.2 million shares were to unaffiliated investors, 1.6 million shares were to ALJ’s Chief Executive Officer, and 0.1 million were to Faneuil’s President and Chief Executive Officer. Each investor received 33% warrant coverage with a two-year term to purchase ALJ common stock at $1.80 per share. Entry into Executive Employment Agreement with Jess Ravich On July 29, 2019, the Company entered into an Employment Agreement (the “Employment Agreement”) with Jess Ravich. Prior to entering into the Employment Agreement, Mr. Ravich served as the Company’s Executive Chairman. Pursuant to the Employment Agreement, Mr. Ravich will assume full-time responsibilities as the Company’s Chief Executive Officer until September 30, 2020 (the “Initial Term”), subject to subsequent automatic two-year renewals. Mr. Ravich will continue to serve as the Company’s Chairman of the Board. |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Policies) | 9 Months Ended |
Jun. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization | Organization ALJ Regional Holdings, Inc. (including subsidiaries, referred to collectively in this Report as “ALJ,” the “Company” or “we”) is a holding company. ALJ’s primary assets as of June 30, 2019 were all of the outstanding capital stock of the following companies: • Faneuil, Inc. (including its subsidiaries, “Faneuil”). • Floors-N-More, LLC, dba, Carpets N’ More (“Carpets”). • Phoenix Color Corp. (including its subsidiaries, “Phoenix”). ALJ has organized its business and corporate structure along the following business segments: Faneuil, Carpets, and Phoenix. ALJ is reported as corporate overhead. |
Basis of Presentation | Basis of Presentation The interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP, for interim financial information and with the instructions to the Securities and Exchange Commission, or SEC, Form 10-Q and Article 10 of SEC Regulation S-X. They do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. Therefore, these financial statements should be read in conjunction with ALJ’s audited financial statements and notes thereto for the years ended September 30, 2018 and 2017 contained in its Annual Report on Form 10-K, filed with the SEC on December 17, 2018. The Company has made estimates and judgments affecting the amounts reported in its condensed consolidated financial statements and the accompanying notes. Significant estimates and assumptions by management are used for, but are not limited to, revenue recognition, including estimated customer lives, determining the fair value of assets and liabilities, including intangible assets acquired and allocation of acquisition purchase prices, estimated useful lives, recoverability of long-lived and intangible assets, the recoverability of goodwill, the realizability of deferred tax assets, stock-based compensation, the likelihood of material loss as a result of loss contingencies, the allowance for doubtful accounts and inventory reserves, and calculation of insurance reserves. Actual results may differ materially from estimates. The interim financial information is unaudited but reflects all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly ALJ’s results of operations and financial position for the interim period. The results of operations for the three and nine months ended June 30, 2019, are not necessarily indicative of the results expected for future quarters or the full year. For a complete summary of ALJ’s significant accounting policies, please refer to Note 2, “Summary of Significant Accounting Policies,” included with ALJ’s audited financial statements and notes thereto for the years ended September 30, 2018 and 2017 contained in its Annual Report on Form 10-K, filed with the SEC on December 17, 2018. There were no material changes to ALJ’s significant accounting policies during the nine months ended June 30, 2019. |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Printing Components Business Acquisition [Member] | |
Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed on Business Purchase Date and Purchase Price Details | The following schedule reflects the estimated fair value of assets acquired and liabilities assumed on the Printing Components Business Purchase Date and the purchase price details: (in thousands) Purchase Price Balance Sheet Caption Allocation Total current assets $ 1,767 Fixed assets 2,273 Identified intangible asset - supply agreement 4,700 Goodwill 1,408 Total assets 10,148 Total current liabilities (148 ) Purchase price $ 10,000 Break Out of Components of Purchase Price Consideration Term loan (note 7) $ 7,500 Common stock issued (note 9) 1,500 Cash received from exercise of stock option 1,000 Purchase price $ 10,000 |
Concentration Risks (Tables)
Concentration Risks (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Sales Revenue, Segment [Member] | Faneuil [Member] | |
Schedule of Concentration Percentage of Different Customers | Faneuil Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Customer A 14.6 % 16.4 % 14.0 % 15.1 % Customer B 11.3 11.8 10.6 10.5 Customer C ** ** 11.8 11.8 ** Less than 10% of Faneuil net revenue. |
Sales Revenue, Segment [Member] | Carpets [Member] | |
Schedule of Concentration Percentage of Different Customers | Carpets Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Customer A 33.6 % 19.9 % 28.9 % 20.5 % Customer B 24.5 27.9 28.4 28.3 Customer C 21.7 19.3 21.3 21.8 |
Sales Revenue, Segment [Member] | Phoenix [Member] | |
Schedule of Concentration Percentage of Different Customers | Phoenix Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Customer A 22.1 % 16.8 % 20.1 % 17.1 % Customer B 17.2 16.7 19.8 18.0 Customer C 13.4 11.4 11.4 ** Customer D 13.0 10.9 12.1 10.4 ** Less than 10% of Phoenix net revenue. |
Inventory Purchases [Member] | Carpets [Member] | |
Schedule of Concentration Percentage of Different Customers | Carpets Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Supplier A 20.9 % ** 17.5 % ** Supplier B 16.7 21.9 20.7 19.2 Supplier C 11.9 22.2 14.6 22.7 Supplier D ** 14.4 ** 13.9 ** Less than 10% of Carpets inventory purchases. |
Composition of Certain Financ_2
Composition of Certain Financial Statement Captions (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Summary of Accounts Receivable | The following table summarizes accounts receivable at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Accounts receivable $ 42,199 $ 42,815 Unbilled receivables 1,660 3,776 Accounts receivable 43,859 46,591 Less: allowance for doubtful accounts (132 ) (208 ) Accounts receivable, net $ 43,727 $ 46,383 |
Summary of Inventories | The following table summarizes inventories at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Raw materials $ 4,008 $ 4,017 Semi-finished goods/work in process 2,401 2,298 Finished goods 1,402 1,566 Inventories 7,811 7,881 Less: allowance for obsolete inventory (323 ) (225 ) Inventories, net $ 7,488 $ 7,656 |
Summary of Property and Equipment | The following table summarizes property and equipment at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Leasehold improvements $ 31,371 $ 9,334 Machinery and equipment 29,918 24,900 Building and improvements 17,035 16,459 Software 16,039 15,749 Computer and office equipment 12,700 11,319 Land 9,267 9,267 Furniture and fixtures 7,302 3,834 Construction and equipment in process 1,249 10,627 Vehicles 375 342 Property and equipment 125,256 101,831 Less: accumulated depreciation and amortization (52,652 ) (41,669 ) Property and equipment, net $ 72,604 $ 60,162 |
Summary of Goodwill | The following table summarizes goodwill by reportable segment at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Faneuil $ 21,276 $ 21,276 Carpets 2,555 2,555 Phoenix 32,541 32,541 Goodwill $ 56,372 $ 56,372 |
Summary of Intangible Assets | The following table summarizes identified intangible assets at the end of each reporting period: June 30, 2019 September 30, 2018 (in thousands) Gross Accumulated Amortization Net Gross Accumulated Amortization Net Customer relationships $ 34,400 $ (12,491 ) $ 21,909 $ 34,400 $ (10,329 ) $ 24,071 Trade names 10,760 (1,896 ) 8,864 10,760 (1,573 ) 9,187 Supply agreements/contract backlog 10,358 (2,898 ) 7,460 10,358 (1,836 ) 8,522 Internal software 580 (551 ) 29 580 (479 ) 101 Non-compete agreements 520 (252 ) 268 2,330 (1,811 ) 519 Totals $ 56,618 $ (18,088 ) $ 38,530 $ 58,428 $ (16,028 ) $ 42,400 |
Summary of Expected Future Amortization Expense | The following table presents expected future amortization expense for the remainder (in thousands) Estimated Future Amortization Remainder of Fiscal 2019 $ 1,230 Fiscal 2020 4,800 Fiscal 2021 4,485 Fiscal 2022 4,067 Fiscal 2023 4,067 Thereafter 19,881 Total $ 38,530 |
Summary of Line of Credit, Term Loan and Equipment Financing | The following table summarizes ALJ’s line of credit, term loan, and equipment financing at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Line of credit: Line of credit $ 13,327 $ 8,739 Less: deferred loan costs (164 ) (145 ) Line of credit, net of deferred loan costs $ 13,163 $ 8,594 Current portion of term loans: Current portion of term loan $ 8,200 $ 9,470 Current portion of equipment financing 1,319 — Less: deferred loan costs (428 ) (875 ) Current portion of term loans, net of deferred loan costs $ 9,091 $ 8,595 Term loans, less current portion: Term loans, less current portion $ 74,933 $ 75,504 Equipment financing, less current portion 2,105 — Less: deferred loan costs (1,134 ) (709 ) Term loans, less current portion, net of deferred loan costs $ 75,904 $ 74,795 |
Summary of Accrued Expenses | The following table summarizes accrued expenses at the end of each reporting period: June 30, September 30, (in thousands) 2019 2018 Accrued compensation and related taxes $ 7,138 $ 7,275 Professional fees and other 2,642 1,123 Call center buildout 2,099 2,700 Rebates payable 1,485 1,491 Interest payable 763 676 Medical and benefit-related payables 730 609 Accrued board of director fees 521 130 Deferred rent 120 174 Sales tax payable 114 193 Total accrued expenses $ 15,612 $ 14,371 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Summary of Basic and Diluted Loss Per Share of Common Stock | The following table summarizes basic and diluted loss per share of common stock for each period presented: Three Months Ended June 30, Nine Months Ended June 30, ( in thousands, except per share amounts 2019 2018 2019 2018 Net loss $ (7,207 ) $ (2,896 ) $ (6,073 ) $ (8,554 ) Weighted average shares of common stock outstanding - basic and diluted 38,026 37,921 38,034 37,801 Loss per share of common stock–basic and diluted $ (0.19 ) $ (0.08 ) $ (0.16 ) $ (0.23 ) |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Summary of Financing Agreement and Amendments | The Financing Agreement and amendments thereto are summarized below ( in thousands Description Use of Proceeds Origination Date Interest Rate * Quarterly Payments Balance at June 30, 2019 Term Loan: Financing Agreement Phoenix acquisition August 2015 9.00% to 9.28% $ 1,610 $ 65,283 First Amendment Color Optics acquisition July 2016 9.00% to 9.28% 175 7,111 Third Amendment Printing Components Business acquisition October 2017 9.00% to 9.28% 151 6,102 Fourth Amendment Working capital November 2018 9.00% to 9.28% 114 4,637 Totals $ 2,050 $ 83,133 Line of Credit: Cerberus/PNC Revolver (includes Second Amendment) Working capital August 2015 11.00% to 11.25% $ — $ 13,327 * Range of annual interest rates accrued during the nine months ended June 30, 2019. |
Schedule of Estimated Future Minimum Principal Payments for Cerberus Debt and Equipment Financing | Estimated Future Minimum Principal Payments Estimated future minimum principal payments for the Cerberus Debt and Equipment Financing are as follows ( in thousands Year Ending June 30, Equipment Financing Cerberus Debt Total 2020 $ 1,319 $ 8,200 $ 9,519 2021 1,386 8,200 9,586 2022 719 8,200 8,919 2023 — 8,200 8,200 2024* — 63,660 63,660 Total $ 3,424 $ 96,460 $ 99,884 * The majority of this amount is the final balloon payment due on the Amended Maturity Date. |
Schedule of Future Minimum Lease Payments under Non-Cancelable Capital Leases | As of June 30, 2019, future minimum payments under non-cancelable capital leases with initial or remaining terms of one year or more are as follows ( in thousands Year Ending June 30, Estimated Future Payments 2020 $ 2,650 2021 1,610 2022 647 2023 535 2024 301 Total minimum required payments 5,743 Less: current portion of capital lease obligations (2,472 ) Less: imputed interest (363 ) Capital lease obligations, less current portion $ 2,908 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Commitments and Sublease Income under Non-cancellable Leases | As of June 30, 2019, future minimum rental commitments and sublease income under non-cancellable leases were as follows ( in thousands Year Ending June 30, Future Minimum Lease Payments Lease Income Net 2020 $ 6,689 $ (499 ) $ 6,190 2021 5,658 — 5,658 2022 4,648 — 4,648 2023 4,375 — 4,375 2024 4,406 — 4,406 Thereafter 19,644 — 19,644 Total $ 45,420 $ (499 ) $ 44,921 |
Equity (Tables)
Equity (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Summary of Total Stock-Based Compensation Expense Included in Selling General and Administrative Expense on Statements of Operations | The following table sets forth the total stock-based compensation expense included in selling, general and administrative expense on the statement of operations: Three Months Ended June 30, Nine Months Ended June 30, (in thousands) 2019 2018 2019 2018 Stock options $ 84 $ 142 $ 252 $ 500 Common stock awards 101 107 304 312 Total stock-based compensation expense $ 185 $ 249 $ 556 $ 812 |
Reportable Segments and Geogr_2
Reportable Segments and Geographic Information (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Summary of Segment Information | The following tables present ALJ’s segment information for the three and nine months ended June 30, 2019 and 2018: Three Months Ended June 30, 2019 ( in thousands Faneuil Carpets Phoenix ALJ Total Net revenue $ 44,773 $ 12,763 $ 26,689 $ — $ 84,225 Segment adjusted EBITDA $ 518 $ 478 $ 4,881 $ (712 ) $ 5,165 Depreciation and amortization (5,598 ) Interest expense (2,701 ) Lease payments in anticipation of facility shutdown (73 ) Stock-based compensation (185 ) Restructuring expenses (66 ) Acquisition-related expenses (85 ) Disposal of assets and other gain (2 ) Provision for income taxes (3,662 ) Net loss $ (7,207 ) Nine Months Ended June 30, 2019 ( in thousands Faneuil Carpets Phoenix ALJ Total Net revenue $ 146,565 $ 37,213 $ 82,227 $ — $ 266,005 Segment adjusted EBITDA $ 8,257 $ 910 $ 15,437 $ (2,092 ) $ 22,512 Depreciation and amortization (14,881 ) Interest expense (8,041 ) Lease payments in anticipation of facility shutdown (517 ) Stock-based compensation (556 ) Loan amendment fees (337 ) Restructuring expenses (225 ) Acquisition-related expenses (97 ) Disposal of assets and other gain 221 Provision for income taxes (4,152 ) Net loss $ (6,073 ) Three Months Ended June 30, 2018 (in thousands) Faneuil Carpets Phoenix ALJ Total Net revenue $ 43,893 $ 18,013 $ 27,754 $ — $ 89,660 Segment adjusted EBITDA $ 3,604 $ 582 $ 6,021 $ (621 ) $ 9,586 Depreciation and amortization (4,718 ) Interest expense (2,526 ) Litigation loss (2,910 ) Restructuring expenses (779 ) Stock-based compensation (249 ) Acquisition-related expenses (106 ) Disposal of assets and other gain (59 ) Provision for income taxes (1,135 ) Net loss $ (2,896 ) Nine Months Ended June 30, 2018 ( in thousands Faneuil Carpets Phoenix ALJ Total Net revenue $ 143,320 $ 53,354 $ 83,045 $ — $ 279,719 Segment adjusted EBITDA $ 10,229 $ (384 ) $ 15,640 $ (1,717 ) $ 23,768 Depreciation and amortization (14,401 ) Interest expense (7,979 ) Litigation loss (2,910 ) Restructuring expenses (2,042 ) Stock-based compensation (812 ) Acquisition-related expenses (229 ) Disposal of assets and other gain 173 Provision for income taxes (4,122 ) Net loss $ (8,554 ) |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) $ in Thousands | Oct. 02, 2017USD ($)Investor | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) |
Business Acquisition [Line Items] | |||||
Payments to acquisition of business assets and liabilities | $ 1,000 | $ 9,000 | |||
Proceeds from stock option exercise | 278 | ||||
Net revenue | $ 84,225 | $ 89,660 | 266,005 | 279,719 | |
Purchase-related legal and accounting fees | 85 | 106 | 97 | 229 | |
LSC and Moore-Langen [Member] | Phoenix [Member] | |||||
Business Acquisition [Line Items] | |||||
Payments to acquisition of business assets and liabilities | $ 10,000 | ||||
Printing Components Business Acquisition [Member] | |||||
Business Acquisition [Line Items] | |||||
Maximum measurement period for estimates of assets acquired and liabilities assumed | 1 year | ||||
Net revenue | $ 3,200 | 3,100 | $ 10,200 | 11,200 | |
Printing Components Business Acquisition [Member] | Selling, General and Administrative Expense [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase-related legal and accounting fees | $ 0 | $ 100 | |||
Printing Components Business Acquisition [Member] | Executive Chairman [Member] | |||||
Business Acquisition [Line Items] | |||||
Proceeds from stock option exercise | $ 1,000 | ||||
Printing Components Business Acquisition [Member] | Common Stock [Member] | Private Offering [Member] | |||||
Business Acquisition [Line Items] | |||||
Business acquisition common stock sold, value | $ 1,500 | ||||
Business acquisition common stock sold to number of investors | Investor | 2 | ||||
Printing Components Business Acquisition [Member] | Cerberus Term Loan [Member] | |||||
Business Acquisition [Line Items] | |||||
Proceeds from debt | $ 7,500 | ||||
Printing Components Business Acquisition [Member] | Phoenix [Member] | |||||
Business Acquisition [Line Items] | |||||
Business acquisition amount withheld from consideration paid | $ 1,000 | ||||
Business acquisition withheld amount payable date | Oct. 31, 2018 |
Acquisitions - Summary of Estim
Acquisitions - Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed on Business Purchase Date and Purchase Price Details (Detail) - USD ($) $ in Thousands | Oct. 02, 2017 | Jun. 30, 2019 | Sep. 30, 2018 |
Identified intangible assets: | |||
Goodwill | $ 56,372 | $ 56,372 | |
Printing Components Business Acquisition [Member] | |||
Balance Sheet Caption | |||
Total current assets | $ 1,767 | ||
Fixed assets | 2,273 | ||
Identified intangible assets: | |||
Goodwill | 1,408 | ||
Total assets | 10,148 | ||
Total current liabilities | (148) | ||
Purchase price | 10,000 | ||
Break Out of Components of Purchase Price Consideration | |||
Term loan (note 7) | 7,500 | ||
Common stock issued (note 9) | 1,500 | ||
Cash received from exercise of stock option | 1,000 | ||
Purchase price | 10,000 | ||
Printing Components Business Acquisition [Member] | Supply Agreements/Contract Backlog [Member] | |||
Identified intangible assets: | |||
Identified intangible assets | $ 4,700 |
Concentration Risks - Additiona
Concentration Risks - Additional Information (Detail) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019USD ($) | Jun. 30, 2018 | Jun. 30, 2019USD ($)CustomerSegment | Jun. 30, 2018 | |
Faneuil [Member] | ||||
Concentration Risk [Line Items] | ||||
Accounts receivable | $ 5.9 | $ 5.9 | ||
Carpets [Member] | ||||
Concentration Risk [Line Items] | ||||
Accounts receivable | 2.3 | 2.3 | ||
Phoenix [Member] | ||||
Concentration Risk [Line Items] | ||||
Accounts receivable | $ 6.4 | $ 6.4 | ||
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | ||||
Concentration Risk [Line Items] | ||||
Number of customers that represent more than 10% of consolidated net revenue | Customer | 0 | |||
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Minimum [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 10.00% | |||
Supplier Concentration Risk [Member] | ||||
Concentration Risk [Line Items] | ||||
Number of segments representing more than 10% supplier contribution | Segment | 2 | |||
Supplier Concentration Risk [Member] | Sales Revenue, Net [Member] | Maximum [Member] | Carpets [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 10.00% | |||
Supplier Concentration Risk [Member] | Inventory Purchases [Member] | Phoenix [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 19.60% | 22.90% | 23.80% | 27.50% |
Supplier Concentration Risk [Member] | Inventory Purchases [Member] | Minimum [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 10.00% |
Concentration Risks - Major Cus
Concentration Risks - Major Customers and Accounts Receivable - Schedule of Concentration Percentage of Different Customers (Detail) - Sales Revenue, Segment [Member] - Customer Concentration Risk [Member] | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Customer A [Member] | Faneuil [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 14.60% | 16.40% | 14.00% | 15.10% |
Customer A [Member] | Carpets [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 33.60% | 19.90% | 28.90% | 20.50% |
Customer A [Member] | Phoenix [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 22.10% | 16.80% | 20.10% | 17.10% |
Customer B [Member] | Faneuil [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 11.30% | 11.80% | 10.60% | 10.50% |
Customer B [Member] | Carpets [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 24.50% | 27.90% | 28.40% | 28.30% |
Customer B [Member] | Phoenix [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 17.20% | 16.70% | 19.80% | 18.00% |
Customer C [Member] | Faneuil [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 11.80% | 11.80% | ||
Customer C [Member] | Carpets [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 21.70% | 19.30% | 21.30% | 21.80% |
Customer C [Member] | Phoenix [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 13.40% | 11.40% | 11.40% | |
Customer D [Member] | Phoenix [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 13.00% | 10.90% | 12.10% | 10.40% |
Concentration Risks - Major C_2
Concentration Risks - Major Customers and Accounts Receivable - Schedule of Concentration Percentage of Different Customers (Parenthetical) (Detail) - Maximum [Member] - Sales Revenue, Segment [Member] - Customer Concentration Risk [Member] | 9 Months Ended |
Jun. 30, 2019 | |
Faneuil [Member] | |
Concentration Risk [Line Items] | |
Concentration risk, percentage | 10.00% |
Phoenix [Member] | |
Concentration Risk [Line Items] | |
Concentration risk, percentage | 10.00% |
Concentration Risks - Supplier
Concentration Risks - Supplier Risk - Schedule of Concentration Percentage of Different Customers (Detail) - Supplier Concentration Risk [Member] - Inventory Purchases [Member] - Carpets [Member] | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Supplier A [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 20.90% | 17.50% | ||
Supplier B [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 16.70% | 21.90% | 20.70% | 19.20% |
Supplier C [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 11.90% | 22.20% | 14.60% | 22.70% |
Supplier D [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 14.40% | 13.90% |
Concentration Risks - Supplie_2
Concentration Risks - Supplier Risk - Schedule of Concentration Percentage of Different Customers (Parenthetical) (Detail) | 9 Months Ended |
Jun. 30, 2019 | |
Maximum [Member] | Sales Revenue, Net [Member] | Supplier Concentration Risk [Member] | Carpets [Member] | |
Concentration Risk [Line Items] | |
Concentration risk, percentage | 10.00% |
Composition of Certain Financ_3
Composition of Certain Financial Statement Captions - Summary of Accounts Receivable (Detail) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Accounts Receivable Net Current [Abstract] | ||
Accounts receivable | $ 42,199 | $ 42,815 |
Unbilled receivables | 1,660 | 3,776 |
Accounts receivable | 43,859 | 46,591 |
Less: allowance for doubtful accounts | (132) | (208) |
Accounts receivable, net | $ 43,727 | $ 46,383 |
Composition of Certain Financ_4
Composition of Certain Financial Statement Captions - Summary of Inventories (Detail) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 4,008 | $ 4,017 |
Semi-finished goods/work in process | 2,401 | 2,298 |
Finished goods | 1,402 | 1,566 |
Inventories | 7,811 | 7,881 |
Less: allowance for obsolete inventory | (323) | (225) |
Inventories, net | $ 7,488 | $ 7,656 |
Composition of Certain Financ_5
Composition of Certain Financial Statement Captions - Summary of Property and Equipment (Detail) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 125,256 | $ 101,831 |
Less: accumulated depreciation and amortization | (52,652) | (41,669) |
Property and equipment, net | 72,604 | 60,162 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 29,918 | 24,900 |
Building and Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 17,035 | 16,459 |
Construction and Equipment In Process [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,249 | 10,627 |
Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 16,039 | 15,749 |
Computer and Office Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 12,700 | 11,319 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 31,371 | 9,334 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 9,267 | 9,267 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 7,302 | 3,834 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 375 | $ 342 |
Composition of Certain Financ_6
Composition of Certain Financial Statement Captions - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Oct. 01, 2018 | |
Condensed Financial Statements, Captions [Line Items] | |||||
Depreciation and amortization expense including capital leased assets | $ 4,400,000 | $ 3,300,000 | $ 11,000,000 | $ 10,300,000 | |
Intangible asset amortization expense | 1,300,000 | $ 1,400,000 | 3,900,000 | $ 4,100,000 | |
Faneuil [Member] | Workers' Compensation Claims [Member] | Maximum [Member] | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Self-insured amount | 500,000 | 500,000 | |||
Faneuil [Member] | Health Insurance Claims [Member] | Maximum [Member] | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Self-insured amount | $ 150,000 | $ 150,000 | |||
Carpets [Member] | Workers' Compensation Claims [Member] | Maximum [Member] | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Self-insured amount | $ 200,000 |
Composition of Certain Financ_7
Composition of Certain Financial Statement Captions - Summary of Goodwill (Detail) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Goodwill [Line Items] | ||
Goodwill | $ 56,372 | $ 56,372 |
Faneuil [Member] | ||
Goodwill [Line Items] | ||
Goodwill | 21,276 | 21,276 |
Carpets [Member] | ||
Goodwill [Line Items] | ||
Goodwill | 2,555 | 2,555 |
Phoenix [Member] | ||
Goodwill [Line Items] | ||
Goodwill | $ 32,541 | $ 32,541 |
Composition of Certain Financ_8
Composition of Certain Financial Statement Captions - Summary of Intangible Assets (Detail) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 56,618 | $ 58,428 |
Accumulated Amortization | (18,088) | (16,028) |
Net | 38,530 | 42,400 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | 34,400 | 34,400 |
Accumulated Amortization | (12,491) | (10,329) |
Net | 21,909 | 24,071 |
Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | 10,760 | 10,760 |
Accumulated Amortization | (1,896) | (1,573) |
Net | 8,864 | 9,187 |
Supply Agreements/Contract Backlog [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | 10,358 | 10,358 |
Accumulated Amortization | (2,898) | (1,836) |
Net | 7,460 | 8,522 |
Internal Software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | 580 | 580 |
Accumulated Amortization | (551) | (479) |
Net | 29 | 101 |
Non-compete Agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | 520 | 2,330 |
Accumulated Amortization | (252) | (1,811) |
Net | $ 268 | $ 519 |
Composition of Certain Financ_9
Composition of Certain Financial Statement Captions - Summary of Expected Future Amortization Expense (Detail) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Finite Lived Intangible Assets Future Amortization Expense [Abstract] | ||
Remainder of Fiscal 2019 | $ 1,230 | |
Fiscal 2020 | 4,800 | |
Fiscal 2021 | 4,485 | |
Fiscal 2022 | 4,067 | |
Fiscal 2023 | 4,067 | |
Thereafter | 19,881 | |
Net | $ 38,530 | $ 42,400 |
Composition of Certain Finan_10
Composition of Certain Financial Statement Captions - Summary of Line of Credit, Term Loan and Equipment Financing (Detail) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Line of credit: | ||
Line of credit | $ 13,327 | $ 8,739 |
Less: deferred loan costs | (164) | (145) |
Line of credit, net of deferred loan costs | 13,163 | 8,594 |
Current portion of term loans: | ||
Current portion of term loan | 8,200 | 9,470 |
Current portion of equipment financing | 1,319 | |
Less: deferred loan costs | (428) | (875) |
Current portion of term loans, net of deferred loan costs | 9,091 | 8,595 |
Term loans, less current portion: | ||
Term loans, less current portion | 74,933 | 75,504 |
Equipment financing, less current portion | 2,105 | |
Less: deferred loan costs | (1,134) | (709) |
Term loans, less current portion, net of deferred loan costs | $ 75,904 | $ 74,795 |
Composition of Certain Finan_11
Composition of Certain Financial Statement Captions - Summary of Accrued Expenses (Detail) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Accrued Liabilities Current [Abstract] | ||
Accrued compensation and related taxes | $ 7,138 | $ 7,275 |
Professional fees and other | 2,642 | 1,123 |
Call center buildout | 2,099 | 2,700 |
Rebates payable | 1,485 | 1,491 |
Interest payable | 763 | 676 |
Medical and benefit-related payables | 730 | 609 |
Accrued board of director fees | 521 | 130 |
Deferred rent | 120 | 174 |
Sales tax payable | 114 | 193 |
Total accrued expenses | $ 15,612 | $ 14,371 |
Loss Per Share - Summary of Bas
Loss Per Share - Summary of Basic and Diluted Loss Per Share of Common Stock (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Earnings Per Share [Abstract] | ||||
Net loss | $ (7,207) | $ (2,896) | $ (6,073) | $ (8,554) |
Weighted average shares of common stock outstanding– basic and diluted | 38,026 | 37,921 | 38,034 | 37,801 |
Loss per share of common stock–basic and diluted | $ (0.19) | $ (0.08) | $ (0.16) | $ (0.23) |
Loss Per Share - Additional Inf
Loss Per Share - Additional Information (Detail) - Stock Options to Purchase Common Stock [Member] - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Stock options to purchase shares of common stock excluded from computation of diluted earnings (loss) per share | 1.6 | 1.6 | ||
Maximum [Member] | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Stock options to purchase shares of common stock excluded from computation of diluted earnings (loss) per share | 1.7 | 1.7 |
Debt - Additional Information (
Debt - Additional Information (Detail) | Dec. 31, 2018USD ($) | Nov. 28, 2018USD ($)CustomerTradingDayshares | Dec. 31, 2018USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2018USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2017USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Aug. 31, 2015USD ($) |
Debt Instrument [Line Items] | ||||||||||
Selling, general and administrative expense | $ 18,037,000 | $ 21,058,000 | $ 52,510,000 | $ 59,418,000 | ||||||
Debt instrument, description | Pursuant to the Second Amendment to the Financing Agreement, ALJ is required to pay a fee (a “Contingent Payment”) in each of three consecutive annual periods which began on May 27, 2018, if at any time during each annual period there are any amounts outstanding on the Cerberus/PNC Revolver. Such Contingent Payments become due and payable on the first day within each annual period there is an outstanding balance on the Cerberus/PNC Revolver. | |||||||||
Equipment Financing [Member] | Phoenix [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Agreement term | 36 months | |||||||||
Frequency of periodic payment | monthly | |||||||||
Interest rate fixed percentage | 4.94% | 4.94% | 4.94% | |||||||
Equipment Financing [Member] | Phoenix [Member] | Heidelberg Press [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Payments to acquire equipment | $ 4,100,000 | |||||||||
Cerberus Term Loan [Member] | Term Loan [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument face amount | $ 105,000,000 | |||||||||
Annual principal payments as percentage of excess cash flow | 75.00% | |||||||||
Excess cash flow payment | $ 300,000 | $ 4,100,000 | ||||||||
Maximum payments against loan with no penalty | $ 7,000,000 | |||||||||
Mandatory payment | 400,000 | |||||||||
Payment of debt instrument legal and other fees | 600,000 | 300,000 | ||||||||
Deferred loan costs | 400,000 | $ 300,000 | 400,000 | $ 300,000 | ||||||
Selling, general and administrative expense | $ 200,000 | |||||||||
Cerberus Term Loan [Member] | Term Loan [Member] | Term Loan Repayment First Year Anniversary [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Prepayment penalty percentage | 3.00% | |||||||||
Cerberus Term Loan [Member] | Term Loan [Member] | Term Loan Repayment Second Year Anniversary [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Prepayment penalty percentage | 2.00% | |||||||||
Cerberus Term Loan [Member] | Term Loan [Member] | Term Loan Repayment Third Year Anniversary [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Prepayment penalty percentage | 1.00% | |||||||||
Fourth Amendment [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum amount of Equity or subordinated debt financing | $ 5,000,000 | |||||||||
Fourth Amendment [Member] | Financing Agreement [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Term loan repayment | $ 2,100,000 | $ 2,300,000 | ||||||||
Number of new customer call centers | Customer | 3 | |||||||||
Debt instrument, covenant description | an easing of the fixed charge coverage ratio financial covenant from 1.25:1.00 to (a) 1.05:1.00 for each quarter beginning with the quarter ended December 31, 2018 through the quarter ending September 30, 2020 and (b) 1.10:1.00 for the quarter beginning with the quarter ending December 31, 2020 and for each quarter thereafter; anda stepdown in the leverage ratio financial covenant from (a) 3.50:1.00 for each quarter beginning with the quarter ended December 31, 2018 through the quarter ending September 30, 2020, to (b) 3.25:1.00 for each quarter beginning with the quarter ending December 31, 2020 through the quarter ending September 30, 2021, (c) 3.00:1.00 for each quarter beginning with the quarter ending December 31, 2021 through the quarter ending September 30, 2022 and (d) 2.75:1.00 for each quarter beginning with the quarter ending December 31, 2022 and for each quarter thereafter. | |||||||||
Fixed charge coverage ratio | 1.25 | |||||||||
Fixed charge coverage ratio, December 31, 2018 through September 30, 2020 | 1.05 | |||||||||
Fixed charge coverage ratio, thereafter | 1.10 | |||||||||
Leverage ratio, December 31, 2018 through September 30, 2020 | 3.50 | |||||||||
Leverage ratio, December 31, 2020 through September 30, 2021 | 3.25 | |||||||||
Leverage ratio, December 31, 2011 through September 30, 2022 | 3 | |||||||||
Leverage ratio, December 31, 2022 and thereafter | 2.75 | |||||||||
Fourth Amendment [Member] | Term Loan [Member] | Financing Agreement [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Proceeds from debt | $ 5,000,000 | |||||||||
Cerberus Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Unused borrowing capacity | 8,500,000 | $ 8,500,000 | ||||||||
Revolving Credit Facility [Member] | Cerberus/PNC Revolver [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Line of credit facility maximum borrowing capacity | $ 30,000,000 | |||||||||
Cerberus/PNC Revolver [Member] | Fourth Amendment [Member] | Financing Agreement [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Line of credit facility maximum borrowing capacity | 30,000,000 | |||||||||
Proceeds from debt | 5,000,000 | |||||||||
Line of credit facility remaining borrowing capacity | $ 25,000,000 | |||||||||
Debt instrument maturity date | Dec. 1, 2023 | |||||||||
Backstop Letter Agreement [Member] | Fourth Amendment [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
One time backstop fee | $ 100,000 | |||||||||
Warrants expiration period | 5 years | |||||||||
Warrant to purchase common stock | shares | 1,500,000 | |||||||||
Debt instrument, convertible threshold trading days | TradingDay | 30 | |||||||||
Backstop fee and other fees | $ 100,000 | 100,000 | ||||||||
Backstop Letter Agreement [Member] | Fourth Amendment [Member] | Selling, General and Administrative Expense [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Backstop fee and other fees | $ 100,000 |
Debt - Summary of Financing Agr
Debt - Summary of Financing Agreement and Amendments (Detail) $ in Thousands | 9 Months Ended |
Jun. 30, 2019USD ($) | |
Line of Credit [Member] | Cerberus/PNC Revolver [Member] | |
Debt Instrument [Line Items] | |
Use of Proceeds | Working capital |
Origination Date | 2015-08 |
Balance | $ 13,327 |
Minimum [Member] | Line of Credit [Member] | Cerberus/PNC Revolver [Member] | |
Debt Instrument [Line Items] | |
Interest Rate | 11.00% |
Maximum [Member] | Line of Credit [Member] | Cerberus/PNC Revolver [Member] | |
Debt Instrument [Line Items] | |
Interest Rate | 11.25% |
Term Loan [Member] | |
Debt Instrument [Line Items] | |
Quarterly Payments | $ 2,050 |
Balance | $ 83,133 |
Term Loan [Member] | Financing Agreement [Member] | Phoenix Acquisition [Member] | |
Debt Instrument [Line Items] | |
Origination Date | 2015-08 |
Quarterly Payments | $ 1,610 |
Balance | $ 65,283 |
Term Loan [Member] | Financing Agreement [Member] | Minimum [Member] | Phoenix Acquisition [Member] | |
Debt Instrument [Line Items] | |
Interest Rate | 9.00% |
Term Loan [Member] | Financing Agreement [Member] | Maximum [Member] | Phoenix Acquisition [Member] | |
Debt Instrument [Line Items] | |
Interest Rate | 9.28% |
Term Loan [Member] | First Amendment [Member] | Color Optics Acquisition [Member] | |
Debt Instrument [Line Items] | |
Origination Date | 2016-07 |
Quarterly Payments | $ 175 |
Balance | $ 7,111 |
Term Loan [Member] | First Amendment [Member] | Minimum [Member] | Color Optics Acquisition [Member] | |
Debt Instrument [Line Items] | |
Interest Rate | 9.00% |
Term Loan [Member] | First Amendment [Member] | Maximum [Member] | Color Optics Acquisition [Member] | |
Debt Instrument [Line Items] | |
Interest Rate | 9.28% |
Term Loan [Member] | Third Amendment [Member] | Printing Components Business Acquisition [Member] | |
Debt Instrument [Line Items] | |
Origination Date | 2017-10 |
Quarterly Payments | $ 151 |
Balance | $ 6,102 |
Term Loan [Member] | Third Amendment [Member] | Minimum [Member] | Printing Components Business Acquisition [Member] | |
Debt Instrument [Line Items] | |
Interest Rate | 9.00% |
Term Loan [Member] | Third Amendment [Member] | Maximum [Member] | Printing Components Business Acquisition [Member] | |
Debt Instrument [Line Items] | |
Interest Rate | 9.28% |
Term Loan [Member] | Fourth Amendment [Member] | |
Debt Instrument [Line Items] | |
Use of Proceeds | Working capital |
Origination Date | 2018-11 |
Quarterly Payments | $ 114 |
Balance | $ 4,637 |
Term Loan [Member] | Fourth Amendment [Member] | Minimum [Member] | |
Debt Instrument [Line Items] | |
Interest Rate | 9.00% |
Term Loan [Member] | Fourth Amendment [Member] | Maximum [Member] | |
Debt Instrument [Line Items] | |
Interest Rate | 9.28% |
Debt - Schedule of Estimated Fu
Debt - Schedule of Estimated Future Minimum Principal Payments for Cerberus Debt and Equipment Financing (Detail) $ in Thousands | Jun. 30, 2019USD ($) |
Debt Instrument [Line Items] | |
2020 | $ 9,519 |
2021 | 9,586 |
2022 | 8,919 |
2023 | 8,200 |
2024* | 63,660 |
Total estimated future minimum payments | 99,884 |
Cerberus Debt [Member] | |
Debt Instrument [Line Items] | |
2020 | 8,200 |
2021 | 8,200 |
2022 | 8,200 |
2023 | 8,200 |
2024* | 63,660 |
Total estimated future minimum payments | 96,460 |
Equipment Financing [Member] | |
Debt Instrument [Line Items] | |
2020 | 1,319 |
2021 | 1,386 |
2022 | 719 |
Total estimated future minimum payments | $ 3,424 |
Debt - Schedule of Future Minim
Debt - Schedule of Future Minimum Lease Payments under Non-Cancelable Capital Leases (Detail) - USD ($) | Jun. 30, 2019 | Sep. 30, 2018 |
Capital Leases Future Minimum Payments Due Rolling Maturity [Abstract] | ||
2020 | $ 2,650,000 | |
2021 | 1,610,000 | |
2022 | 647,000 | |
2023 | 535,000 | |
2024 | 301,000 | |
Total minimum required payments | 5,743,000 | |
Less: current portion of capital lease obligations | (2,472,000) | $ (2,909,000) |
Less: imputed interest | (363,000) | |
Capital lease obligations, less current portion | $ 2,908,000 | $ 4,427,000 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Future Minimum Rental Commitments under Non-cancellable Leases (Detail) $ in Thousands | Jun. 30, 2019USD ($) |
Operating Leases Future Minimum Payments Due Rolling Maturity [Abstract] | |
2020 | $ 6,689 |
2021 | 5,658 |
2022 | 4,648 |
2023 | 4,375 |
2024 | 4,406 |
Thereafter | 19,644 |
Total future minimum lease payments | 45,420 |
Lease income, 2020 | (499) |
Lease income | (499) |
Operating leases net, 2020 | 6,190 |
Operating leases net, 2021 | 5,658 |
Operating leases net, 2022 | 4,648 |
Operating leases net, 2023 | 4,375 |
Operating leases net, 2024 | 4,406 |
Operating leases net, Thereafter | 19,644 |
Operating leases net, | $ 44,921 |
Commitments and Contingencies_2
Commitments and Contingencies - Additional Information (Detail) - USD ($) | May 15, 2018 | Jun. 06, 2017 | Oct. 14, 2016 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 22, 2016 |
Loss Contingencies [Line Items] | |||||||
Non-cash litigation loss | $ (2,910,000) | $ (2,910,000) | |||||
Selling, General and Administrative Expense [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Non-cash litigation loss | $ (2,900,000) | ||||||
Faneuil [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Recovery value on subcontract | $ 5,100,000 | ||||||
Recovery of subcontract description basis | Breach of contract, breach of the implied covenant of good faith and fair dealing, and unjust enrichment. | ||||||
Litigation settlement, amount of damages awarded | 0 | $ 300,000 | |||||
Litigation settlement, amount awarded for plaintiff's attorney fees | $ 700,000 | ||||||
3M Company [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Recovery value on subcontract | $ 10,000,000 | ||||||
Recovery of subcontract description basis | Breach of contract/indemnification, breach of the implied covenant of good faith and fair dealing, and unjust enrichment. | ||||||
Damages payable | 3,200,000 | ||||||
Additional damages incurred | $ 10,000,000 | ||||||
Litigation settlement, amount of damages awarded | $ 0 | ||||||
Letters of Credit [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Line of credit amount outstanding | $ 3,600,000 | ||||||
Surety Bonds [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Estimated maximum guarantee cash payments | 25,800,000 | ||||||
Employment Agreements [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Total termination payments related to base salary and medical premiums | $ 1,200,000 |
Equity - Additional Information
Equity - Additional Information (Detail) | Oct. 02, 2017Stockholder$ / sharesshares | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)shares | Jun. 30, 2018USD ($)$ / sharesshares |
Class Of Stock [Line Items] | |||||
Disposal of assets and other (gain) loss, net | $ (2,000) | $ (59,000) | $ 221,000 | $ 173,000 | |
Total unrecognized compensation cost related to unvested stock options | 400,000 | $ 400,000 | |||
Weighted-average recognition period of unrecognized compensation cost related to unvested stock options | 1 year 3 months 18 days | ||||
Stock option awards, granted | shares | 0 | 10,000 | |||
Weighted average expected option life | 6 years | ||||
Weighted average expected volatility rate | 48.40% | ||||
Expected dividend yield | 0.00% | ||||
Weighted average risk free interest rate | 2.10% | ||||
Total intrinsic value of options vested outstanding | 100,000 | $ 100,000 | |||
Stock-based compensation expense | 185,000 | 249,000 | 556,000 | $ 812,000 | |
Common Stock Awards [Member] | |||||
Class Of Stock [Line Items] | |||||
Stock-based compensation expense | $ 101,000 | $ 107,000 | $ 304,000 | 312,000 | |
Maximum [Member] | |||||
Class Of Stock [Line Items] | |||||
Total estimated fair value of stock options, granted | $ 100,000 | ||||
Common Stock [Member] | |||||
Class Of Stock [Line Items] | |||||
Shares issued upon exercise of employee stock options | shares | 300,000 | ||||
Weighted-average exercise price of employee stock options | $ / shares | $ 0.93 | ||||
Common Stock [Member] | Board of Directors [Member] | |||||
Class Of Stock [Line Items] | |||||
Stock issued as compensation | shares | 102,102 | ||||
Faneuil [Member] | |||||
Class Of Stock [Line Items] | |||||
Number of common stock retired | shares | 84,000 | ||||
Disposal of assets and other (gain) loss, net | $ 100,000 | ||||
Printing Components Business Acquisition [Member] | Common Stock [Member] | |||||
Class Of Stock [Line Items] | |||||
Business acquisition common stock issued, shares | shares | 477,706 | ||||
Business acquisition common stock issued, per shares | $ / shares | $ 3.14 | ||||
Business acquisition common stock sold to number of shareholders | Stockholder | 2 |
Equity - Summary of Total Stock
Equity - Summary of Total Stock-Based Compensation Expense Included in Selling General and Administrative Expenses on Statements of Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expense | $ 185 | $ 249 | $ 556 | $ 812 |
Stock Options [Member] | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expense | 84 | 142 | 252 | 500 |
Common Stock Awards [Member] | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expense | $ 101 | $ 107 | $ 304 | $ 312 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | Sep. 27, 2017 | Dec. 31, 2023 | Jun. 30, 2019 | Dec. 31, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 |
Income Taxes Disclosure [Line Items] | |||||||
Non-cash deferred income tax expense | $ 3,600 | $ 3,626 | $ 3,883 | ||||
Federal statutory income tax rate | 35.00% | 21.00% | 28.10% | ||||
Income tax rate reconciliation deductions interest expense | 30.00% | ||||||
Percentage of bonus depreciation for eligible property placed in service allowed for immediate deduction | 100.00% | ||||||
Property eligibility for bonus depreciation with longer production period | Jan. 1, 2023 | ||||||
Change in tax rate income tax expense benefit | $ 4,100 | ||||||
Scenario Forecast [Member] | |||||||
Income Taxes Disclosure [Line Items] | |||||||
Percentage of eligible property placed in service allowed for immediate deduction | 100.00% |
Related-Party Transactions - Ad
Related-Party Transactions - Additional Information (Detail) - Harland Clarke Holdings Corp. ("Harland Clarke") [Member] - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Related Party Transaction [Line Items] | |||||
Revenue recognized | $ 0 | $ 100,000 | $ 100,000 | $ 200,000 | |
Cost of revenue | $ 0 | $ 100,000 | $ 100,000 | $ 300,000 | |
Minimum [Member] | |||||
Related Party Transaction [Line Items] | |||||
Ownership percentage | 5.00% | 5.00% | |||
Maximum [Member] | |||||
Related Party Transaction [Line Items] | |||||
Accounts receivable | $ 0 | $ 0 | $ 100,000 |
Reportable Segments and Geogr_3
Reportable Segments and Geographic Information - Additional Information (Detail) | 9 Months Ended |
Jun. 30, 2019Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Reportable Segments and Geogr_4
Reportable Segments and Geographic Information - Summary of Segment Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Segment Reporting Information [Line Items] | ||||
Net revenue | $ 84,225 | $ 89,660 | $ 266,005 | $ 279,719 |
Segment adjusted EBITDA | 5,165 | 9,586 | 22,512 | 23,768 |
Depreciation and amortization | (5,598) | (4,718) | (14,881) | (14,401) |
Interest expense | (2,701) | (2,526) | (8,041) | (7,979) |
Litigation loss | (2,910) | (2,910) | ||
Lease payments in anticipation of facility shutdown | (73) | (517) | ||
Stock-based compensation | (185) | (249) | (556) | (812) |
Loan amendment fees | (337) | |||
Restructuring expenses | (66) | (779) | (225) | (2,042) |
Acquisition-related expenses | (85) | (106) | (97) | (229) |
Disposal of assets and other (gain) loss, net | (2) | (59) | 221 | 173 |
Provision for income taxes | (3,662) | (1,135) | (4,152) | (4,122) |
Net loss | (7,207) | (2,896) | (6,073) | (8,554) |
Operating Segments [Member] | Faneuil [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net revenue | 44,773 | 43,893 | 146,565 | 143,320 |
Segment adjusted EBITDA | 518 | 3,604 | 8,257 | 10,229 |
Operating Segments [Member] | Carpets [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net revenue | 12,763 | 18,013 | 37,213 | 53,354 |
Segment adjusted EBITDA | 478 | 582 | 910 | (384) |
Operating Segments [Member] | Phoenix [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net revenue | 26,689 | 27,754 | 82,227 | 83,045 |
Segment adjusted EBITDA | 4,881 | 6,021 | 15,437 | 15,640 |
ALJ [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Segment adjusted EBITDA | $ (712) | $ (621) | $ (2,092) | $ (1,717) |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) $ / shares in Units, $ in Thousands, shares in Millions | Jul. 31, 2019USD ($)Customer$ / sharesshares | Jul. 29, 2019USD ($) | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) |
Subsequent Event [Line Items] | ||||||
Capital expenditures | $ 15,096 | $ 3,100 | ||||
Proceeds from issuance of common stock | $ 1,500 | |||||
Financing Agreement [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Capital expenditures | $ 15,000 | |||||
Leverage ratio | 3.50 | |||||
Financing Agreement [Member] | Fifth Amendment [Member] | Scenario Forecast [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Leverage ratio | 3.75 | 3.75 | ||||
Subsequent Event [Member] | Financing Agreement [Member] | Fifth Amendment [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Number of new customer call centers | Customer | 3 | |||||
Capital expenditures | $ 18,500 | |||||
Subsequent Event [Member] | Financing Agreement [Member] | Seasonal Revolver Facility [Member] | Fifth Amendment [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Revolver facility | $ 7,500 | |||||
Subsequent Event [Member] | Employment Agreement [Member] | Chief Executive Officer [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Automatic renewal of employment term | 2 years | |||||
Base salary | $ 200 | |||||
Realtime Digital Innovations LLC [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Date of acquisition | Jul. 31, 2019 | |||||
Service before business acquisition | 18 months | |||||
Realtime Digital Innovations LLC [Member] | Subsequent Event [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Cash | $ 2,500 | |||||
Earn-out consideration | $ 7,500 | |||||
Earn-out consideration payment period | 3 years | |||||
Guaranteed payout consideration | $ 2,500 | |||||
Warrant coverage percentage | 33.00% | |||||
Warrant coverage term | 2 years | |||||
Realtime Digital Innovations LLC [Member] | Subsequent Event [Member] | Common Stock [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Business acquisition common stock issued, shares | shares | 3.9 | |||||
Business acquisition common stock issued, per shares | $ / shares | $ 1.80 | |||||
Proceeds from issuance of common stock | $ 7,000 | |||||
Realtime Digital Innovations LLC [Member] | Subsequent Event [Member] | Unaffiliated Investors [Member] | Common Stock [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Business acquisition common stock issued, shares | shares | 2.2 | |||||
Realtime Digital Innovations LLC [Member] | Subsequent Event [Member] | Chief Executive Officer [Member] | Common Stock [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Business acquisition common stock issued, shares | shares | 1.6 | |||||
Realtime Digital Innovations LLC [Member] | Subsequent Event [Member] | President And Chief Executive Officer [Member] | Common Stock [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Business acquisition common stock issued, shares | shares | 0.1 |