COVER PAGE
COVER PAGE - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Mar. 11, 2024 | Jun. 30, 2023 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-38880 | ||
Entity Registrant Name | Whole Earth Brands, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 38-4101973 | ||
Entity Address, Address Line One | 125 S. Wacker Drive | ||
Entity Address, Address Line Two | Suite 1250 | ||
Entity Address, City or Town | Chicago | ||
Entity Address, State or Province | IL | ||
Entity Address, Postal Zip Code | 60606 | ||
City Area Code | 312 | ||
Local Phone Number | 840-6000 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 128,804,442 | ||
Entity Common Stock, Shares Outstanding | 42,858,649 | ||
Documents Incorporated by Reference | Certain information contained in the registrant’s definitive proxy statement relating to its annual meeting of stockholders to be held in 2024, or in an amendment to this Annual Report on Form 10-K, to be filed with the Securities and Exchange Commission (the “SEC”) within 120 days after the end of the fiscal year to which this Annual Report on Form 10-K relates, is incorporated herein by reference where indicated. Except with respect to information specifically incorporated by reference in this Annual Report on Form 10-K, such proxy statement or amendment is not deemed to be filed as part hereof. | ||
Entity Central Index Key | 0001753706 | ||
Amendment Flag | false | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2023 | ||
Document Financial Statement Error Correction [Flag] | false | ||
Common Stock | |||
Document Information [Line Items] | |||
Title of 12(b) Security | Common stock, par value $0.0001 per share | ||
Trading Symbol | FREE | ||
Security Exchange Name | NASDAQ | ||
Warrant | |||
Document Information [Line Items] | |||
Title of 12(b) Security | Warrants to purchase one-half of one share of common stock | ||
Trading Symbol | FREEW | ||
Security Exchange Name | NASDAQ |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Auditor Information [Abstract] | |
Auditor Firm ID | 42 |
Auditor Name | Ernst & Young LLP |
Auditor Location | New York, NY |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current Assets | ||
Cash and cash equivalents | $ 30,513 | $ 28,676 |
Accounts receivable (net of allowances of $1,460 and $1,614, respectively) | 74,012 | 66,653 |
Inventories | 209,271 | 218,975 |
Prepaid expenses and other current assets | 6,429 | 10,530 |
Total current assets | 320,225 | 324,834 |
Property, Plant and Equipment, net | 54,937 | 58,092 |
Other Assets | ||
Operating lease right-of-use assets | 19,223 | 18,238 |
Goodwill | 193,610 | 193,139 |
Other intangible assets, net | 229,936 | 245,376 |
Deferred tax assets, net | 500 | 539 |
Other assets | 7,266 | 8,785 |
Total Assets | 825,697 | 849,003 |
Current Liabilities | ||
Accounts payable | 55,662 | 47,002 |
Accrued expenses and other current liabilities | 32,173 | 27,488 |
Current portion of operating lease liabilities | 7,370 | 8,804 |
Current portion of long-term debt | 3,750 | 3,750 |
Total current liabilities | 98,955 | 87,044 |
Non-Current Liabilities | ||
Long-term debt | 417,929 | 432,172 |
Deferred tax liabilities, net | 31,579 | 32,585 |
Operating lease liabilities, less current portion | 14,336 | 12,664 |
Other liabilities | 11,208 | 9,987 |
Total Liabilities | 574,007 | 574,452 |
Commitments and Contingencies (Note 10) | 0 | 0 |
Stockholders’ Equity | ||
Preferred shares, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding | 0 | 0 |
Common stock, $0.0001 par value; 220,000,000 shares authorized; 42,853,468 and 41,994,355 shares issued and outstanding at December 31, 2023 and December 31, 2022, respectively | 4 | 4 |
Additional paid-in capital | 365,721 | 360,777 |
Accumulated deficit | (123,284) | (85,188) |
Accumulated other comprehensive income (loss) | 9,249 | (1,042) |
Total stockholders’ equity | 251,690 | 274,551 |
Total Liabilities and Stockholders’ Equity | $ 825,697 | $ 849,003 |
Consolidated and Combined Balan
Consolidated and Combined Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowances | $ 1,460 | $ 1,614 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 220,000,000 | 220,000,000 |
Common stock, shares issued (in shares) | 42,853,468 | 41,994,355 |
Common stock, shares outstanding (in shares) | 42,853,468 | 41,994,355 |
Consolidated and Combined State
Consolidated and Combined Statements of Operations - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | |||||
Product revenues, net | $ 550,913 | $ 538,272 | $ 493,973 | ||
Cost of goods sold | 407,236 | 398,060 | 335,218 | ||
Gross profit | 143,677 | 140,212 | 158,755 | ||
Selling, general and administrative expenses | 102,354 | 99,735 | 113,141 | ||
Amortization of intangible assets | 18,698 | 18,623 | 18,295 | ||
Goodwill impairment charges | 7,230 | 46,500 | 0 | ||
Restructuring and other expenses | 0 | 0 | 4,503 | ||
Operating income (loss) | 15,395 | (24,646) | 22,816 | ||
Interest expense, net | (43,974) | (30,600) | (24,589) | ||
Loss on extinguishment and debt transaction costs | 0 | 0 | (5,513) | ||
Other (expense) income, net | (3,188) | 2,283 | 225 | ||
Loss before income taxes | (31,767) | (52,963) | (7,061) | ||
Provision (benefit) for income taxes | 6,329 | 5,789 | (7,144) | ||
Net (loss) income | $ (38,096) | $ (58,752) | $ 83 | ||
Net (loss) earnings per share: | |||||
Basic (in dollars per share) | $ (0.90) | $ (1.42) | $ 0 | ||
Diluted (in dollars per share) | $ (0.90) | $ (1.42) | $ 0 | ||
Revenue from Contract with Customer, Product and Service [Extensible List] | Product [Member] | Product [Member] | Product [Member] | Product [Member] |
Consolidated and Combined Sta_2
Consolidated and Combined Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | |||
Net (loss) income | $ (38,096) | $ (58,752) | $ 83 |
Other comprehensive income (loss), net of tax: | |||
Net change in pension benefit obligations recognized, net of taxes of $(164), $640, and $26, respectively | (748) | 2,740 | 98 |
Unrealized gains and losses on cash flow hedges, net of taxes of $(9), $0, and $0, respectively | (28) | 0 | 0 |
Gains and losses on cash flow hedges reclassified to net income, net of taxes of $(252), $0, and $0, respectively | (720) | 0 | 0 |
Foreign currency translation adjustments | 11,787 | (13,469) | 984 |
Total other comprehensive income (loss), net of tax | 10,291 | (10,729) | 1,082 |
Comprehensive (loss) income | $ (27,805) | $ (69,481) | $ 1,165 |
Consolidated and Combined Sta_3
Consolidated and Combined Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | |||
Net change in pension benefit obligations recognized, tax | $ (164) | $ 640 | $ 26 |
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification, Tax | (9) | 0 | 0 |
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, Tax | $ (252) | $ 0 | $ 0 |
Consolidated and Combined Sta_4
Consolidated and Combined Statements of Equity - USD ($) $ in Thousands | Total | Restatement adjustment | Common Stock | Additional Paid-in Capital | Additional Paid-in Capital Restatement adjustment | Accumulated Deficit | Accumulated Deficit Restatement adjustment | Accumulated Other Comprehensive Income |
Beginning balance at Dec. 31, 2020 | $ 308,846 | $ 4 | $ 325,679 | $ (25,442) | $ 8,605 | |||
Beginning balance (in shares) at Dec. 31, 2020 | 38,426,669 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Transfer of Private Warrants to Public Warrants | 6,057 | 6,057 | ||||||
Net (loss) income | 83 | 83 | ||||||
Other comprehensive income (loss), net of tax | 1,082 | 1,082 | ||||||
Warrant exercises | $ 1 | 1 | ||||||
Warrant exercises (in shares) | 100 | |||||||
Stock-based compensation | $ 7,854 | 7,854 | ||||||
Net share settlements of stock-based compensation (in shares) | 444,877 | |||||||
Net share settlements of stock-based awards | (1,913) | (1,913) | ||||||
Ending balance (in shares) at Dec. 31, 2021 | 38,871,646 | |||||||
Ending balance at Dec. 31, 2021 | 313,871 | $ (8,139) | $ 4 | 330,616 | $ (7,062) | (26,436) | $ (1,077) | 9,687 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Transfer of Private Warrants to Public Warrants | 605 | 605 | ||||||
Net (loss) income | (58,752) | (58,752) | ||||||
Other comprehensive income (loss), net of tax | (10,729) | (10,729) | ||||||
Stock-based compensation | 4,636 | 4,636 | ||||||
Net share settlements of stock-based compensation (in shares) | 259,372 | |||||||
Net share settlements of stock-based awards | (418) | (418) | ||||||
Stock Issued During Period, Shares, Net Share Settlements Under Bonus Plan | 203,763 | |||||||
Stock Issued During Period, Shares, Acquisitions | 2,659,574 | |||||||
Stock Issued During Period, Value, Acquisitions | 23,936 | 23,936 | ||||||
Stock Issued During Period, Value, Net Share Settlements Under Bonus Plan | 1,402 | 1,402 | ||||||
Ending balance (in shares) at Dec. 31, 2022 | 41,994,355 | |||||||
Ending balance at Dec. 31, 2022 | 274,551 | $ 4 | 360,777 | (85,188) | (1,042) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Transfer of Private Warrants to Public Warrants | 133 | 133 | ||||||
Net (loss) income | (38,096) | (38,096) | ||||||
Other comprehensive income (loss), net of tax | 10,291 | 10,291 | ||||||
Stock-based compensation | 6,264 | 6,264 | ||||||
Net share settlements of stock-based awards | (1,468) | (1,468) | ||||||
Stock Issued During Period, Shares, Net Share Settlements Under Bonus Plan | 854,759 | |||||||
Net share settlements of liability-based awards | 15 | 15 | ||||||
Net share settlements of liability-based awards (in shares) | 4,354 | |||||||
Ending balance (in shares) at Dec. 31, 2023 | 42,853,468 | |||||||
Ending balance at Dec. 31, 2023 | $ 251,690 | $ 4 | $ 365,721 | $ (123,284) | $ 9,249 |
Consolidated and Combined Sta_5
Consolidated and Combined Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating activities | |||
Net (loss) income | $ (38,096) | $ (58,752) | $ 83 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||
Stock-based compensation | 7,029 | 4,933 | 8,715 |
Depreciation | 6,638 | 6,001 | 4,727 |
Amortization of intangible assets | 18,698 | 18,623 | 18,295 |
Deferred income taxes | (1,054) | (456) | (12,300) |
Goodwill impairment charges | 7,230 | 46,500 | 0 |
Amortization of inventory fair value adjustments | 0 | (2,537) | (3,396) |
Non-cash loss on extinguishment of debt | 0 | 0 | 4,435 |
Amortization of debt issuance costs and original issue discount | 2,252 | 1,982 | 1,783 |
Change in fair value of warrant liabilities | (78) | (1,232) | (29) |
Changes in current assets and liabilities: | |||
Accounts receivable | (5,455) | 1,222 | 964 |
Inventories | 10,282 | (7,684) | (22,957) |
Prepaid expenses and other current assets | 1,572 | 201 | (1,030) |
Accounts payable, accrued liabilities and income taxes | 14,266 | (11,574) | 12,050 |
Other, net | 2,034 | (3,037) | (1,858) |
Net cash provided by (used in) operating activities | 25,318 | (5,810) | 9,482 |
Investing activities | |||
Capital expenditures | (5,661) | (8,887) | (12,198) |
Acquisitions, net of cash acquired | 0 | 0 | (190,231) |
Proceeds from sale of fixed assets | 18 | 468 | 4,516 |
Net cash used in investing activities | (5,643) | (8,419) | (197,913) |
Financing activities | |||
Proceeds from revolving credit facility | 0 | 54,000 | 25,000 |
Repayments of revolving credit facility | (12,000) | (3,000) | (47,855) |
Long-term borrowings | 0 | 0 | 375,000 |
Repayments of long-term borrowings | (3,750) | (3,750) | (139,314) |
Debt issuance costs | (461) | (719) | (11,589) |
Payment of contingent consideration | 0 | (29,108) | 0 |
Proceeds from sale of common stock and warrants | 0 | 0 | 1 |
Tax withholdings related to net share settlements of stock-based awards | (1,468) | (898) | (1,913) |
Net cash (used in) provided by financing activities | (17,679) | 16,525 | 199,330 |
Effect of exchange rate changes on cash and cash equivalents | (159) | (1,916) | 499 |
Net change in cash and cash equivalents | 1,837 | 380 | 11,398 |
Cash and cash equivalents, beginning of period | 28,676 | 28,296 | 16,898 |
Cash and cash equivalents, end of period | 30,513 | 28,676 | 28,296 |
Supplemental disclosure of cash flow information | |||
Interest paid | 41,770 | 28,386 | 21,203 |
Taxes paid, net of refunds | 4,815 | 9,113 | 4,523 |
Supplemental disclosure of non-cash investing | |||
Non-cash capital expenditures | $ 0 | $ 0 | $ 3,796 |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | NOTE 1: BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Whole Earth Brands, Inc. and its consolidated subsidiaries (“Whole Earth Brands” or the “Company”) is a global industry-leading platform, focused on the “better for you” consumer packaged goods (“CPG”) and ingredients space. The Company has a global platform of branded products and ingredients, focused on the consumer transition towards natural alternatives and clean label products. On June 24, 2020, Act II Global Acquisition Corp., a Cayman Islands exempted company (“Act II”), domesticated into a Delaware corporation (the “Domestication”), and on June 25, 2020 (the “Closing”), consummated the indirect acquisition (the “Business Combination”) of (i) all of the issued and outstanding equity interests of Merisant Company (“Merisant”), Merisant Luxembourg Sarl (“Merisant Luxembourg”), Mafco Worldwide LLC (“Mafco Worldwide”), Mafco Shanghai LLC (“Mafco Shanghai”), EVD Holdings LLC (“EVD Holdings”), and Mafco Deutschland GmbH (together with Merisant, Merisant Luxembourg, Mafco Worldwide, Mafco Shanghai, and EVD Holdings, and their respective direct and indirect subsidiaries, “Merisant and Mafco Worldwide”), and (ii) certain assets and liabilities of Merisant and Mafco Worldwide included in the Transferred Assets and Liabilities (as defined in the Purchase Agreement (as hereafter defined)), from Flavors Holdings Inc. (“Flavors Holdings”), MW Holdings I LLC (“MW Holdings I”), MW Holdings III LLC (“MW Holdings III”), and Mafco Foreign Holdings, Inc. (“Mafco Foreign Holdings,” and together with Flavors Holdings, MW Holdings I, and MW Holdings III, the “Sellers”), pursuant to that certain Purchase Agreement (the “Purchase Agreement”) entered into by and among Act II and the Sellers dated as of December 19, 2019, as amended. In connection with the Domestication, Act II changed its name to “Whole Earth Brands, Inc.” Upon the completion of the Domestication, each of Act II’s then-issued and outstanding ordinary shares converted, on a one-for-one basis, into shares of common stock of Whole Earth Brands. Additionally, immediately after the Business Combination, the Company issued an aggregate of 7,500,000 shares of Whole Earth Brands common stock and 5,263,500 private placement warrants exercisable for 2,631,750 shares of Whole Earth Brands common stock to certain investors. On the date of Closing, the Company’s common stock and warrants began trading on The Nasdaq Stock Market under the symbols “FREE” and “FREEW,” respectively. Principles of Consolidation —The consolidated financial statements include the accounts of Whole Earth Brands, Inc., and its indirect and wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates —The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from these estimates. Reclassifications —Certain previously reported amounts have been reclassified to conform to the current presentation. Cash and Cash Equivalent s—The Company considers all cash on hand, money market funds, and other highly liquid debt instruments with a maturity, when purchased, of three months or less to be cash and cash equivalents. Accounts Receivable and Allowance for Credit Losses —Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for credit losses is the Company’s best estimate of the amount of probable losses in its existing accounts receivable based on historical and expected losses and current economic conditions. Account balances are charged against the allowance when the Company believes it is probable the receivable will not be recovered. The Company does not have any off-balance sheet credit exposure related to its customers. Recoveries of accounts receivable previously offset against the allowance are recorded in the consolidated statements of operations when received. A summary of the activity with respect to the accounts receivable allowances is as follows (in thousands): Accounts receivable allowance balance at December 31, 2020 $ 955 2021 additions charged to revenues, costs and expenses 1,783 2021 deductions and other (1,453) Accounts receivable allowance balance at December 31, 2021 $ 1,285 2022 additions charged to revenues, costs and expenses 2,711 2022 deductions and other (2,382) Accounts receivable allowance balance at December 31, 2022 $ 1,614 2023 additions charged to revenues, costs and expenses 2,671 2023 deductions and other (2,825) Accounts receivable allowance balance at December 31, 2023 $ 1,460 Inventories —Inventories are stated at the lower of cost or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal, and transportation. The cost of inventory is determined by the first in, first out or average cost methods. Property, Plant and Equipment —Property, plant and equipment are recorded at cost. Additions, improvements, and replacements that extend asset life are capitalized. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful lives of the Company’s property, plant and equipment in service currently ranges as follows: 3 to 40 years for buildings and 1 to 20 years for all other equipment. When property and equipment are disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gains or losses are included in income from operations. Ordinary repairs and maintenance costs are charged to operating expense as incurred. Deferred Software Costs —Deferred implementation costs for hosted cloud computing service arrangements are stated at historical cost and amortized on a straight-line basis over the term of the hosting arrangement that the implementation costs relate to. Deferred implementation costs are included in other assets and amortized to selling, general and administrative expenses (“SG&A”). The corresponding cash flows related to deferred software costs will be reported within operating activities consistent with the treatment for payments associated with the service component of the hosting arrangement. The Company reviews the deferred implementation costs for impairment when it believes the deferred costs may no longer be recoverable. As of both December 31, 2023 and 2022, deferred software costs associated with cloud computing arrangements were $2.1 million. Costs of $0.8 million were amortized during 2023. No costs were amortized during 2022 or 2021. Leases —The Company accounts for leases pursuant to Accounting Standards Codification (“ASC”) Topic 842, “Leases.” Under ASC Topic 842, a right-of-use asset and a lease liability is recorded for all leases with a term greater than 12 months. Lease right-of-use assets and lease liabilities are initially recognized based on the present value of the future minimum lease payments over the lease term at commencement date calculated using our incremental borrowing rate applicable to the lease asset, unless the implicit rate is readily determinable. The Company’s leases include manufacturing facilities, office space, warehouses, material handling equipment, vehicles and office equipment. All of our leases are classified as operating leases. Goodwill and Other Indefinite-Lived Intangible Assets —Goodwill and other indefinite-lived intangible assets are summarized in Note 6. The Company reviews goodwill and other indefinite-lived intangible assets for impairment annually, or more frequently if events or changes in circumstances indicate that an asset may be impaired, in accordance with ASC Topic 350, “Intangibles—Goodwill and Other.” Under ASC Topic 350, the impairment review of goodwill and other intangible assets not subject to amortization must be based on estimated fair values. The Company’s annual impairment review measurement date is in the fourth quarter of each year. In performing the annual assessment, the Company has the option of performing a qualitative assessment to determine if it is more likely than not that a reporting unit has been impaired. As part of the qualitative assessment for the reporting units, the Company evaluates the factors that are specific to the reporting units as well as industry and macroeconomic factors (including changes in interest and discount rates). The reporting unit specific factors may include cost factors, a comparison of current year results to prior year, current year budget and future projected financial performance. The Company also considers the change in the overall enterprise value of the Company compared to the prior year. If the Company determines that it is more likely than not that a reporting unit is impaired or if the Company elects not to perform the optional qualitative assessment, a quantitative assessment is performed utilizing both the income and market approaches to estimate the fair value of its reporting units. The income approach involves discounting future estimated cash flows. The discount rate used is the value-weighted average of the reporting unit’s estimated cost of equity and debt derived using both known and estimated customary market metrics adjusted for company specific risks. The Company performs sensitivity tests with respect to growth rates and discount rates used in the income approach. In applying the market approach, valuation multiples are derived from historical and projected operating data of selected guideline companies; evaluated and adjusted, if necessary, based on the strengths and weaknesses of the reporting unit relative to the selected guideline companies; and applied to the appropriate historical and/or projected operating data to arrive at an indication of fair value. The Company typically weights the results of the income and market approaches equally. If the reporting unit’s carrying value exceeds its estimated fair value, then an impairment is recorded for the difference, limited to the total amount of goodwill allocated to the reporting unit. The Company typically evaluates impairment of indefinite-lived intangible assets, which relates to our product formulations, by first performing a qualitative assessment. If the Company elects to bypass the qualitative assessment or determines that it is more likely than not that the fair value of the product formulations is less than its carrying value, a quantitative assessment is then performed using the relief from royalty method under the income approach to estimate the fair value. Some of the more significant assumptions inherent in estimating the fair value include the estimated future annual sales, royalty rates (as a percentage of sales that would hypothetically be charged by a licensor of the brand to an unrelated licensee), income tax considerations and a discount rate that reflects the level of risk. Impairment Review of Long-Lived Assets —In accordance with ASC Topic 360, “Property, Plant and Equipment,” the Company evaluates the carrying value of long-lived assets to be held and used whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset or asset group may be impaired. When such events occur, the Company compares the sum of the future undiscounted cash flows expected to be generated from the asset or asset group over its remaining depreciable life to the carrying value. If this comparison indicates that there is an impairment, the carrying amount of the long-lived asset would then be reduced to the estimated fair value, which generally approximates discounted cash flows. The Company also evaluates the amortization periods of assets to determine whether events or circumstances warrant revised estimates of useful lives. The Company’s applicable long-lived assets include its property, plant and equipment, operating lease right-of-use assets and definite-lived intangible assets. Derivative Instruments —The Company’s earnings and cash flows are subject to fluctuations due to changes in interest rates. The Company uses derivative financial instruments, including interest rate swaps, to manage interest rate exposures and hedge the variability of interest payments on future debt obligations. The Company does not use derivative financial instruments for trading or speculative purposes. The Company formally documents all relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking hedge transactions. This process includes linking the derivatives designated as cash flow hedges to specific forecasted transactions or variability of cash flows. The Company also formally assesses, both at the inception of a hedge transaction and on an ongoing basis, whether the designated derivatives that are used in hedging transactions are highly effective in offsetting changes in the cash flow of the hedged items as well as monitors the credit worthiness of the counterparties to ensure no issues exist which would affect the value of the derivatives. When a derivative is determined not to be highly effective as a hedge or the underlying hedged transaction is no longer probable, the Company discontinues hedge accounting prospectively and reclassifies any hedge related gains or losses previously recorded in other comprehensive income (loss) to other (expense) income within the statement of operations. To the extent the hedge is effective, the Company records derivative financial instruments at fair value in its consolidated balance sheet and changes in the fair value are recorded in accumulated other comprehensive income (loss) and reclassified to earnings when the hedged item affects earnings. Cash flows from derivative instruments are classified in the consolidated statements of cash flows based on the nature of the derivative contract. Additional information pertaining to the Company’s derivative instruments is provided in Note 9. Income Taxes —The provision for income taxes is determined using the asset and liability method in accordance with ASC Topic 740, “Accounting for Income Taxes.” The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized. The Company made a policy election to treat the income tax due on United States (“U.S.”) inclusion of the global intangible low taxed income (“GILTI”) provisions as a period expense when incurred. Uncertainty in Income Taxes —The Company accounts for uncertain tax positions in accordance with the authoritative guidance issued under ASC Topic 740, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. The Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. The Company provides loss contingencies for federal, state and international tax matters relating to potential tax examination issues, planning initiatives and compliance responsibilities. The development of these reserves requires judgements about tax issues, potential outcomes and timing, which if different, may materially impact the Company’s financial condition and results of operations. The Company classifies interest and penalties associated with income taxes as a component of provision (benefit) for income taxes in the consolidated statements of operations. Pension Plans —The Company has defined benefit pension plans and defined contribution 401(k) plans, which cover certain current and former employees of the Company who meet eligibility requirements. Benefits for the defined benefit pension plans are based on years of service and, in some cases, the employee’s compensation. Participation was frozen to all employees hired on or after August 1, 2017. The Company’s policy is to contribute annually the amount required pursuant to the Employee Retirement Income Security Act. The Company froze the qualified pension plan for all participants on December 31, 2019 and froze the non-qualified pension plans on December 31, 2022. The Company terminated the qualified pension plan in 2022 and settled the pension obligations through lump sum payments in 2021 and the purchase of non-participating annuity contracts in 2022 to settle the remaining liabilities of the plan. Certain subsidiaries of the Company outside the U.S. have retirement plans that provide certain payments upon retirement. The Company recognizes in its balance sheet the funded status of its defined benefit pension plans, measured as the difference between the fair value of the plan assets and the benefit obligation and recognizes changes in the funded status of the defined benefit pension plans as accumulated other comprehensive loss, net of tax, within accumulated other comprehensive income (loss) to the extent such changes are not recognized in earnings as components of periodic net benefit cost (see Note 12). These amounts are subsequently amortized within other (expense) income in future periods using the corridor approach. The corridor is 10% of the greater of the market-related value of the plan’s assets or projected benefit obligation. Any actuarial gains and losses in excess of the corridor are then amortized over an appropriate term. Research and Development Costs —The Company expenses costs as incurred for product research and development within SG&A. Research and development expenses were approximately $3.8 million for 2023, $3.9 million for 2022, and $3.4 million for 2021. Stock-Based Compensation —In accordance with ASC Topic 718, “Compensation—Stock Compensation,” the Company recognizes stock-based compensation cost in its consolidated statements of operations. Stock-based compensation cost is measured at the grant date for equity-classified awards and at the end of each reporting period for liability-classified awards based on the estimated fair value of the awards. The Company recognizes stock-based compensation expense on a straight-line basis over the requisite service period. Additional information pertaining to the Company’s stock-based compensation is provided in Note 13. Revenue Recognition —In accordance with ASC Topic 606, “Revenue from Contracts with Customers,” the Company recognizes revenue when control of the promised goods or services is transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Revenues are primarily derived from customer orders for the purchase of products and are generally recognized when the product is shipped or delivered depending on the arrangement with the customer. The Company made an accounting policy election to exclude from the measurement of the transaction price sales taxes and all other items of a similar nature, and also elected to account for shipping and handling activities as a fulfillment of the promise to transfer the goods. Accordingly, shipping and handling costs are included in cost of sales. Branded CPG may offer promotional activities (e.g. coupons, trade discounts and other promotional activities) to its customers. These variable consideration amounts are estimated for each customer based on specific arrangements/agreements, an analysis of historical volume, and/or current activity with that customer. Reassessment of variable consideration estimates is done at each reporting date throughout the contract period until the uncertainty is resolved (e.g. promotional campaign is closed and settled with customer). Historically, the Company has encountered limited instances whereby customers rejected products as a result of orders being materially inaccurate and/or products being defective. The Company tracks the reason codes for those customer returns. Based on that, the materiality of such returns is assessed. A return reserve is calculated (based on historical data as described above) every month to record an adjustment to net sales; these adjustments have not been significant. The following table presents the Company’s revenues disaggregated by product categories (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Sweeteners and adjacencies $ 426,287 $ 422,638 $ 389,174 Licorice products 124,626 115,634 104,799 Total product revenues, net $ 550,913 $ 538,272 $ 493,973 The following table presents revenues disaggregated by business and geographic region (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Branded CPG: North America $ 305,849 $ 299,871 $ 266,661 Europe 70,405 67,962 76,392 India, Middle East and Africa 13,854 17,828 13,363 Asia-Pacific 21,436 22,371 20,787 Latin America 14,743 14,606 11,971 Flavors & Ingredients 124,626 115,634 104,799 Total product revenues, net $ 550,913 $ 538,272 $ 493,973 The Company records an allowance for credit losses as an estimate of the inability of its customers to make their required payments. The determination of the allowance requires the Company to make assumptions about the future ability to collect amounts owed from customers. Marketing, Advertising, Consumer Incentives and Trade Promotions —The Company promotes its products with marketing activities, including advertising, consumer incentives and trade promotions. On an annual basis, advertising costs are expensed as incurred or in the year in which the related advertisement initially appears. Marketing and advertising expense was $12.0 million in 2023, $11.8 million in 2022, $17.0 million in 2021. Consumer incentive and trade promotion activities are deducted from revenue based on amounts estimated as being or becoming due to customers and consumers at the end of a period, based principally on the Company’s historical utilization and redemption rates. These deductions are estimated and recorded upon sale of product by the Company and revised as necessary at each period end. Fair Value Measurements —The Company measures fair value using a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Major Customers and Credit Concentration —The Company sells products to customers in the U.S. and internationally. The Company performs ongoing credit evaluations of customers, and generally does not require collateral on trade accounts receivable. Allowances are maintained for potential credit losses and such losses have been within management’s expectations. Foreign Currency Translation —The Company has determined that the functional currency for each combined subsidiary is its local currency, except for certain entities whose functional currency is the U.S. dollar. Assets and liabilities of entities outside the U.S. are translated into U.S. dollars at the exchange rates in effect at the end of each period and income statement accounts are translated at each period’s average exchange rate. Translation adjustments arising from the use of differing exchange rates from period to period are included as a component of accumulated other comprehensive income (loss) on the balance sheet, except for any entities which may operate in highly inflationary economies. Gains and losses resulting from transactions in other than functional currencies are reflected in operating results, except for transactions of a long-term nature. Remeasurements of European entities whose functional currency is the U.S. dollar as well as translation adjustments for entities operating in highly inflationary economies and impacts of foreign currency transactions are recognized currently in other income (expense), net in the accompanying consolidated statements of operations. The Company had foreign exchange losses, net of $3.3 million in 2023, foreign exchange gains, net of $0.1 million in 2022, and foreign exchange losses of $0.2 million in 2021. Beginning January 1, 2019, the Company was required to apply highly-inflationary accounting to its Argentinian subsidiary. This accounting treatment requires a change in the subsidiary’s functional currency from the local currency (Argentinian Peso) to the parent’s reporting currency (USD). This highly-inflationary classification results from the fact that the cumulative inflation rate for the preceding 3 year period exceeded 100 percent as of June 30, 2018. Accordingly, effective January 1, 2019, all Argentinian Peso denominated monetary assets and liabilities are considered foreign currency denominated assets and liabilities and are revalued to USD (the functional currency) with remeasurement adjustments in the period recorded in the statement of operations. The USD will be the functional currency until the economic environment in Argentina ceases to be considered highly-inflationary. The Company recorded $1.8 million of expense related to remeasurement adjustments for Argentina in the consolidated statements of operations for the year ended December 31, 2023, $1.2 million of expense for the year ended December 31, 2022 and $0.3 million of expense for the year ended December 31, 2021. Restructuring and other expenses —In previous years the Company adopted restructuring plans to streamline processes and realize cost savings by consolidating facilities and eliminating various positions in operations and general and administrative areas. In connection with the restructuring plans, the Company recognized restructuring and other expenses of $4.5 million during the year ended December 31, 2021. This included facility exit and other related costs of $3.9 million and employee termination benefits of $0.6 million in 2021. The Company had no accrued severance expense related to the restructuring plans as of both December 31, 2023 and December 31, 2022. Termination benefits are payable when an employee is involuntarily terminated, or whenever an employee accepts voluntary termination in exchange for termination benefits. One-time involuntary termination benefits are recognized as a liability when the termination plan meets certain criteria and has been communicated to employees. If employees are required to render future service in order to receive these one-time termination benefits, the liability is recognized ratably over the future service period. Warrant Liabilities —The Company accounts for the Private Warrants in accordance with ASC Topic 815, “Derivatives and Hedging.” Under the guidance contained in ASC Topic 815-40, the Private Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Private Warrants as liabilities at their fair value and adjusts the warrants to fair value at each reporting period. The liability is subject to re-measurement at each balance sheet date, and any change in fair value is recognized in the Company’s statement of operations. Based on the views expressed in the SEC’s Staff Statement of April 12, 2021 in which the SEC staff clarified its interpretations of certain generally accepted accounting principles related to certain terms common in warrants issued by Special Purpose Acquisition Companies (“SPACs”), the Company determined that the Private Warrants should be treated as derivative liabilities rather than as components of equity, as previously presented as of December 31, 2020. Accordingly, the Company recorded out of period adjustments at January 1, 2021 to reclassify warrant liabilities of $8.1 million and transaction costs incurred by Act II of $1.1 million related to the issuance of the Private Warrants. Additionally, during the first quarter of 2021, the Company recognized the cumulative effect of the error on prior periods by recording a $1.2 million gain in the Statement of Operations to reflect the cumulative decrease in the fair value of the Private Warrants from the date of issuance through December 31, 2020. The Company concluded that this misstatement was not material to the previously filed financial statements. Accounting Standards Adopted in the Current Year —The Company qualifies as an emerging growth company (an “EGC”) and as such, has elected the extended transition period for complying with certain new or revised accounting pronouncements. During the extended transition period, the Company is not subject to certain new or revised accounting standards applicable to public companies. The accounting pronouncements pending adoption below reflect effective dates for the Company as an EGC with the extended transition period. In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments - Credit Losses (Topic 326).” The standard requires entities to estimate losses on financial assets measured at amortized cost, including trade receivables, debt securities and loans, using an expected credit loss model. The expected credit loss model should consider reasonable and supportable forecasts in addition to the previously considered past events and current conditions. This guidance also includes enhanced requirements for disclosures related to credit loss estimates. Entities must apply the standard provision as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The Company adopted this standard on January 1, 2023. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures and a cumulative-effect adjustment was not deemed necessary. Accounting Standards Not Yet Adopted —In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”. The standard expands segment disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. The standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company is currently evaluating the impact of adopting ASU 2023-07 on its consolidated financial statement disclosures. |
BUSINESS COMBINATION
BUSINESS COMBINATION | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
BUSINESS COMBINATION | NOTE 2: ACQUISITIONS On December 17, 2020, the Company entered into a stock purchase agreement (the “Wholesome Purchase Agreement”) with WSO Investments, Inc. (“WSO Investments” and together with its subsidiaries “Wholesome” and affiliates). WSO Investments is the direct parent of its wholly-owned subsidiary Wholesome Sweeteners, Incorporated, which was formed to import, market, distribute, and sell organic sugars, unrefined specialty sugars, and related products. Wholesome is included within the Company’s Branded CPG reportable segment. Wholesome’s results are included in the Company’s consolidated statement of operations from the date of acquisition. On February 5, 2021, pursuant to the terms of the Wholesome Purchase Agreement, the Company purchased and acquired all of the issued and outstanding shares of capital stock for an initial cash purchase price of $180 million plus up to an additional $55 million (the “Earn-Out Amount”) upon the satisfaction of certain post-closing financial metrics. Subject to the terms and conditions of the Wholesome Purchase Agreement payment of the Earn-Out Amount, in whole or in part, was subject to Wholesome achieving certain EBITDA thresholds at or above approximately $30 million during the period beginning August 29, 2020, and ending December 31, 2021 (the “Earn-Out Period”). A portion of the Earn-Out Amount (up to $27.5 million) could be paid, at the Company’s election, in freely tradeable, registered shares of Company common stock calculated using the 20-day volume weighted average trading price per share as of the date of determination. Calculation of the achievement of the Earn-Out Amount is subject to certain adjustments more thoroughly described in the Wholesome Purchase Agreement. In connection with the acquisition of Wholesome, the Company incurred transaction-related costs of $0.2 million and $4.7 million in the years ended December 31, 2022 and 2021, respectively. Following the completion of the Earn-Out Period, the Company determined, in accordance with the terms of the Purchase Agreement, that the sellers were entitled to receive the Earn-Out Amount in full. The Company elected to satisfy part of the Earn-Out Amount in common stock and on February 23, 2022, issued 2,659,574 shares of the Company’s common stock. The remaining $30 million portion of the $55 million Earn-Out Amount was paid in cash which was funded from available capacity under the Company’s revolving credit facility. The settlement of the earn-out resulted in a non-cash gain of $1.1 million that was recorded in the first quarter of 2022 which represents the difference in value of the common stock issued using the 20-day volume weighted average trading price per share as compared to the trading price on the date of issuance. The following summarizes the purchase consideration (in thousands): Base cash consideration $ 180,000 Closing adjustment 13,863 Fair value of Earn-Out Amount 52,395 Total Purchase Price $ 246,258 The Company recorded the fair value of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed as follows (in thousands): Cash and cash equivalents $ 2,664 Accounts receivable 15,868 Inventories 76,879 Prepaid expenses and other current assets 1,322 Property, plant and equipment, net 3,134 Operating lease right-of-use assets 7,585 Intangible assets 104,500 Other assets 1,189 Total assets acquired 213,141 Accounts payable 5,251 Accrued expenses and other current liabilities 10,576 Current portion of operating lease liabilities 1,435 Operating lease liabilities, less current portion 6,150 Deferred tax liabilities, net 24,234 Total liabilities assumed 47,646 Net assets acquired 165,495 Goodwill 80,763 Total Purchase Price $ 246,258 The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Identifiable intangible assets Fair Value (in thousands) Useful Life (in years) Customer relationships $ 55,700 10 Tradenames 48,800 25 $ 104,500 Goodwill represents the excess of the purchase price over the estimated fair value assigned to tangible and identifiable intangible assets acquired and liabilities assumed and represents the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition, including assembled workforce and expected future market opportunities. Of the purchase price allocated to goodwill, a total of $4.7 million will be deductible for income tax purposes pursuant to IRC Section 197 over a 9-year period. The Company’s allocation of purchase price was based upon valuations performed to determine the fair value of the net assets as of the acquisition date and is subject to adjustments for up to one year after the closing date of the acquisition to reflect final valuations. The allocation of purchase price was finalized in the first quarter of 2022. In 2021, the Company recorded measurement period adjustments to its initial allocation of purchase price as a result of ongoing valuation procedures on assets and liabilities assumed, including (i) an increase in purchase price of $3.6 million due to the finalization of the closing adjustment; (ii) a decrease to inventory of $1.8 million; (iii) an increase in prepaid expenses and other current assets of $0.5 million; (iv) an increase in property, plant and equipment of $0.4 million; (v) a decrease to intangible assets of $1.9 million; (vi) a decrease to other assets of $0.1 million; (vii) a decrease to accrued expenses and other current liabilities of $2.7 million; (viii) a decrease to deferred tax liabilities, net of $2.8 million; and (ix) an increase to goodwill of $1.0 million due to the incremental measurement period adjustments discussed in items (i) through (viii). The impact of measurement period adjustments to the results of operations was immaterial. The results of the Company’s operations for the year ended December 31, 2021 includes the results of Wholesome since February 5, 2021. Product revenues, net and operating income of Wholesome included in the Company’s consolidated statement of operations for the year ended December 31, 2021 were $179.6 million and $20.6 million, respectively. Pro Forma Financial Information — The following unaudited pro forma financial information summarizes the results of operations for the Company as though the Business Combination and the acquisition of Swerve, L.L.C. (“Swerve LLC”), and Swerve IP, L.L.C. (“Swerve IP” and together with Swerve LLC, “Swerve”) on November 10, 2020 had occurred on January 1, 2019 and the Wholesome acquisition had occurred on January 1, 2020 (in thousands): Pro Forma Statements of Operations Year Ended December 31, 2021 Revenue $ 514,353 Net income $ 14,082 The unaudited pro forma financial information does not assume any impacts from revenue, cost or other operating synergies that could be generated as a result of the acquisitions. The unaudited pro forma financial information is for informational purposes only and is not indicative of the results of operations that would have been achieved had the Business Combination and Swerve acquisitions been consummated on January 1, 2019 and the Wholesome acquisition been consummated on January 1, 2020. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
LEASES | NOTE 3: LEASES The Company’s lease portfolio includes factory buildings, office space, warehouses, material handling equipment, vehicles and office equipment. The Company subleases some of its unused office space to third parties. All leases are classified as operating leases. Certain leases include one or more options to renew, with renewal terms that can extend the lease term from one Lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over the expected lease term. The interest rate implicit in lease contracts is typically not readily determinable. As such, the Company utilizes the appropriate incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term at an amount equal to the lease payments in a similar economic environment. The Company’s lease agreements do not contain any residual value guarantees. Some leases include variable payments that are based on the usage and occupancy of the leased asset. The Company has elected not to record leases with an initial term of twelve months or less on the balance sheet. For real estate and vehicle leases, the Company elected the practical expedient to not separate lease from non-lease components within the contract. Electing this practical expedient means the Company accounts for each lease component and the related non-lease component together as a single component. For equipment leases, the Company has not elected this practical expedient and separates the non-lease components from the lease component. The right-of-use asset is subsequently measured throughout the lease term at the carrying amount of the lease liability. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The components of lease expense were as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Operating lease expense $ 9,221 $ 8,370 $ 5,658 Variable lease expense 1,645 1,634 1,022 Short-term lease expense 1,717 711 988 Sublease income (403) (326) (508) Total $ 12,180 $ 10,389 $ 7,160 The following table presents the future maturities of the Company’s lease obligations as of December 31, 2023 (in thousands): 2024 $ 8,215 2025 5,456 2026 3,192 2027 2,802 2028 2,380 Thereafter 2,778 Total lease payments 24,823 Less: imputed interest (3,117) Total operating lease liabilities $ 21,706 The weighted-average remaining lease term was 4.2 years and the weighted-average discount rate was 5.99% as of December 31, 2023. The weighted-average remaining lease term was 3.0 years and the weighted-average discount rate was 4.19% as of December 31, 2022. Cash paid for amounts included in the measurement of the lease liability was $10.2 million, $8.9 million and $5.7 million for the years ended December 31, 2023, 2022 and 2021, respectively. Right-of -use assets obtained in exchange for lease liabilities was $10.2 million, $0.7 million and $12.9 million for the years ended December 31, 2023, 2022 and 2021, respectively. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2023 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 4: INVENTORIES Inventories consisted of the following (in thousands): December 31, 2023 December 31, 2022 Raw materials and supplies $ 125,421 $ 129,131 Work in process 1,505 1,835 Finished goods 82,345 88,009 Total inventories $ 209,271 $ 218,975 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | NOTE 5: PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following (in thousands): December 31, 2023 December 31, 2022 Machinery, equipment and other $ 42,276 $ 39,695 Buildings and improvements 22,431 21,565 64,707 61,260 Accumulated depreciation (16,169) (11,410) 48,538 49,850 Land 5,930 5,951 Construction in progress 469 2,291 Property, plant and equipment, net $ 54,937 $ 58,092 |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 6: GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill and other intangible assets consisted of the following (in thousands): December 31, 2023 December 31, 2022 Gross Accumulated Amortization Net Gross Accumulated Amortization Net Other intangible assets subject to amortization Customer relationships (useful life of 5 to 10 years) $ 105,616 $ (38,074) $ 67,542 $ 105,298 $ (26,137) $ 79,161 Tradenames (useful life of 25 years) 174,495 (22,801) 151,694 171,013 (15,498) 155,515 Total $ 280,111 $ (60,875) $ 219,236 $ 276,311 $ (41,635) $ 234,676 Other intangible assets not subject to amortization Product formulations 10,700 10,700 Total other intangible assets, net 229,936 245,376 Goodwill 193,610 193,139 Total goodwill and other intangible assets $ 423,546 $ 438,515 The Company amortizes its intangible assets subject to amortization on a straight-line basis over their respective useful lives. The remaining intangible assets subject to amortization as of December 31, 2023 have a weighted-average remaining useful life of approximately 17.0 years, including weighted-average remaining useful lives of approximately 6.3 years for customer relationships and approximately 21.8 years for tradenames. Amortization expense for intangible assets was $18.7 million, $18.6 million and $18.3 million for the years ended December 31, 2023, 2022, and 2021 respectively. Amortization expense relating to amortizable intangible assets as of December 31, 2023 for the next five years is expected to be as follows (in thousands): 2024 $ 18,704 2025 18,460 2026 18,229 2027 17,015 2028 15,024 The changes in the carrying amounts of goodwill during the years ended December 31, 2023 and December 31, 2022 were as follows (in thousands): Branded CPG Flavors & Ingredients Total Balance at December 31, 2021 $ 238,857 $ 3,804 $ 242,661 Currency translation adjustment (2,870) (152) (3,022) Gross balance at December 31, 2022 $ 235,987 $ 3,652 $ 239,639 Accumulated impairment loss at December 31, 2022 (46,500) — (46,500) Balance at December 31, 2022 $ 189,487 $ 3,652 $ 193,139 Impairment (7,230) — (7,230) Currency translation adjustment 7,695 6 7,701 Balance at December 31, 2023 $ 189,952 $ 3,658 $ 193,610 Impairment of Goodwill and Other Indefinite-Lived Intangible Assets —As disclosed in Note 1, the Company reviews goodwill and other indefinite-lived intangible assets for impairment annually, or more frequently if events or changes in circumstances indicate that an asset may be impaired, in accordance with ASC Topic 350. The Company performs its annual impairment procedures for all of its reporting units and indefinite-lived intangible assets during the fourth quarter of each year. In 2023 and 2022, the Company performed a quantitative impairment test and estimated the fair values of the reporting units utilizing both the income and market approach to determine the fair values of the Company’s reporting units. As a result of the 2023 impairment test, the Company determined that the carrying value of the IMEA reporting unit within the Branded CPG segment exceeded fair value and as a result, the Company recognized a non-cash impairment charge of $7.2 million in the fourth quarter of 2023. The impairment was primarily due to current macroeconomic conditions, including rising interest rates and higher supply chain costs and other inflationary pressures, which contributed to lower earnings forecasts for the reporting unit. The income approach incorporated estimated future cash flows and a terminal value discounted to present value using an appropriate risk-adjusted discount rate. The estimated future cash flows reflected management’s best estimate of economic and market conditions over the projected period including forecasted revenue, gross margins, tax rates, capital expenditures, depreciation and amortization, changes in working capital requirements and terminal growth rates. The market approach estimated the fair value of the IMEA reporting unit using Company specific and guideline company valuation metrics and was equally weighted with the income approach to determine the fair value of the IMEA reporting unit. After the impairment, the goodwill carrying amount of the IMEA reporting unit was $0 million. As a result of the 2022 impairment test, the Company determined that the carrying values of the North America and LATAM reporting units within the Branded CPG segment exceeded their respective fair values and as a result, the Company recognized a non-cash impairment charge of $46.5 million in the fourth quarter of 2022, which included $42.5 million related to the North America reporting unit and $4.0 million related to the LATAM reporting unit. The impairment was primarily due to current macroeconomic conditions, including rising interest rates and continued currency devaluation in LATAM, and higher supply chain costs and other inflationary pressures which contributed to lower earnings forecasts for our North America and LATAM reporting units. The income approach incorporated estimated future cash flows and a terminal value discounted to present value using an appropriate risk-adjusted discount rate. The estimated future cash flows reflected management’s best estimate of economic and market conditions over the projected period including forecasted revenue, gross margins, tax rates, capital expenditures, depreciation and amortization, changes in working capital requirements and terminal growth rates. The market approach estimated the fair value of the North America reporting unit using Company specific and guideline company valuation metrics and was equally weighted with the income approach to determine the fair value of the North America reporting unit. The Company used the income approach to determine the fair value of the LATAM reporting unit. After the impairments, the goodwill carrying amount of the North America and LATAM reporting units was approximately $80.5 million and $0 million, respectively. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 7: DEBT Debt consisted of the following (in thousands): December 31, 2023 December 31, 2022 Term loan, due 2028 $ 364,688 $ 368,438 Revolving credit facility, due 2026 64,000 76,000 Less: current portion (3,750) (3,750) Less: unamortized discount and debt issuance costs (7,009) (8,516) Total long-term debt $ 417,929 $ 432,172 Maturities —The Company’s debt and other obligations outstanding as of December 31, 2023 mature as shown below (in thousands): 2024 $ 3,750 2025 3,750 2026 67,750 2027 3,750 2028 349,688 Thereafter — Total debt 428,688 Unamortized discounts (7,009) Total debt, net of unamortized discounts $ 421,679 Loan Agreement —At December 31, 2023, the Company’s senior secured loan agreement consisted of a senior secured term loan facility (the “Term Loan Facility”) of $375 million and a revolving credit facility of up to $125 million (the “Revolving Facility,” and together with the Term Loan Facility, the “Credit Facilities”). As of December 31, 2023 and December 31, 2022, term loan borrowings were $357.7 million and $359.9 million, respectively, net of unamortized discount and debt issuance costs of $7.0 million and $8.5 million, respectively. There were $64.0 million and $76.0 million of borrowings under the revolving credit facility as of December 31, 2023 and December 31, 2022, respectively. Additionally, as of December 31, 2023 and December 31, 2022, the Company’s unamortized debt issuance costs related to the revolving credit facility were $1.7 million and $2.0 million, respectively, which are included in other assets in the consolidated balance sheet. As of December 31, 2023 and December 31, 2022, there were $3.3 million and $2.1 million, respectively, of outstanding letters of credit that reduced the Company’s availability under the revolving credit facility. In connection with the closing of the Wholesome Transaction, on February 5, 2021, further discussed in Note 2, the Company and certain of its subsidiaries entered into an amendment and restatement agreement (the “Amended and Restated Agreement”) with Toronto Dominion (Texas) LLC, which amended and restated its existing senior secured loan agreement dated as of June 25, 2020 (as amended on September 4, 2020, the “Existing Credit Agreement,” and as further amended by the Amendment Agreement, the “Amended and Restated Credit Agreement”), by and among Toronto Dominion (Texas), LLC, as administrative agent, certain lenders signatory thereto and certain other parties. As of the date of the Amended and Restated Credit Agreement, the aggregate unamortized debt issuance costs totaled $6.2 million, of which $4.4 million was expensed as a loss on extinguishment of debt in the first quarter of 2021. Additionally, in connection with the Amended and Restated Credit Agreement, the Company paid fees to certain lenders of $3.8 million, which was considered a debt discount, all of which was deferred, and incurred transaction costs of $8.9 million, of which $7.8 million was deferred and $1.1 million was expensed as part of loss on extinguishment and debt transaction costs in the first quarter of 2021. As further described in Note 2, following the completion of the Wholesome Earn-Out Period, the Company determined, in accordance with the terms of the Purchase Agreement, that the sellers were entitled to receive the Earn-Out Amount in full. The Company elected to satisfy part of the Earn-Out Amount in common stock and on February 23, 2022, issued 2,659,574 shares of the Company’s common stock. The remaining $30 million portion of the $55 million Earn-Out Amount was paid in cash which was funded from available capacity under the Company’s revolving credit facility. On June 15, 2022, the Company and certain of its subsidiaries entered into a first amendment (the “Amendment”) to the Amended and Restated Agreement dated as of February 5, 2021. The Amendment increased the aggregate principal amount of the Revolving Credit Facility from $75 million to $125 million (the “Amended Revolving Credit Facility”) and transitioned from LIBOR to Secured Overnight Financing Rate (“SOFR”) as the benchmark for purposes of calculating interest for all loans outstanding under the Amended and Restated Credit Agreement. At the election of the Company, loans outstanding under the Amended and Restated Credit Agreement will accrue interest at a rate per annum equal to (i) term SOFR plus 0.10%, 0.15%, or 0.25% in case of, respectively, a one-month, three-month, or six-month interest period (“Adjusted Term SOFR”), or (ii) the greater of the prime rate, the federal funds effective rate plus 0.50%, and one-month Adjusted Term SOFR plus 1.00%, in each case plus the applicable margin which is equal to (i) with respect to the Amended Revolving Credit Facility and letters of credit, (A) 2.75%, in the case of base rate advances, and (B) 3.75% in the case of SOFR advances, and (ii) with respect to the Term Loan Facility, (A) 3.50%, in the case of base rate advances, and (B) 4.50% in the case of SOFR advances, with a SOFR floor of 1.00%. In connection with the Amendment, the Company paid fees and incurred transactions costs of $0.7 million, all of which was deferred. The transition to SOFR did not materially impact the interest rates applied to the Company’s borrowings. No other material changes were made to the terms of the Company’s Amended and Restated Agreement as a result of the Amendment. On April 24, 2023, the Company and certain of its subsidiaries entered into a second amendment (the “Second Amendment”) to the Amended and Restated Loan Agreement. The Second Amendment changed the maximum consolidated total leverage ratio covenant as follows: (i) the consolidated total leverage ratio temporarily increased by 0.25 turns for the first quarter of 2023, 0.5 turns on a quarterly basis through the fourth quarter of 2023, and 0.25 turns in the first quarter of 2024; and (ii) beginning in the second quarter of 2024, the consolidated total leverage ratio will return to a level not to exceed 5.5x. No other material changes were made in terms of the Company’s Amended and Restated Agreement as a result of the Second Amendment. On October 5, 2023, the Company and certain of its subsidiaries entered into a third amendment (the “Third Amendment”) to the Amended and Restated Loan Agreement. The Third Amendment revised a clause in the definition of consolidated EBITDA used for determining compliance with financial covenants effective beginning with the second quarter of 2023 through the first quarter of 2024. The amendment did not impact the calculation of consolidated EBITDA previously determined for the second quarter of 2023. The obligations under the Credit Facilities are guaranteed by certain direct or indirect wholly-owned domestic subsidiaries of the Company, other than certain excluded subsidiaries, including, but not limited to, immaterial subsidiaries and foreign subsidiaries. The Credit Facilities are secured by substantially all of the personal property of the Company and the guarantor subsidiaries (in each case, subject to certain exclusions and qualifications). The Credit Facilities require the Company to make certain mandatory prepayments, with (i) 100% of net cash proceeds of all non-ordinary course asset sales or other dispositions of property in excess of $5 million in any fiscal year, subject to the ability to reinvest such proceeds and certain other exceptions, (ii) 100% of the net cash proceeds of any debt incurrence, other than debt permitted under the definitive agreements (but excluding debt incurred to refinance the Credit Facilities) and (iii) 50% of “Excess Cash Flow,” as defined in the Amended and Restated Credit Agreement, with a reduction to 25% if the total net leverage ratio for the fiscal year is less than or equal to 3.50 to 1.00 but greater than 3.00 to 1.00, and a reduction to 0% if the total net leverage ratio for the fiscal year is less than or equal to 3.00 to 1.00. The Company also is required to make quarterly amortization payments equal to 0.25% per annum of the original principal amount of the Term Loan Facility (subject to reductions by optional and mandatory prepayments of the loans). |
WARRANTS
WARRANTS | 12 Months Ended |
Dec. 31, 2023 | |
Other Liabilities [Abstract] | |
WARRANTS | NOTE 8: WARRANTS As of the date of the Business Combination, the Company had approximately 20,263,500 warrants outstanding, consisting of (i) 15,000,000 public warrants originally sold as part of the units issued in Act II’s initial public offering (the “Public Warrants”) and (ii) 5,263,500 Private Warrants that were sold by Act II to the PIPE Investors in conjunction with the Business Combination (collectively with the Public Warrants, the “Warrants”). Each warrant is exercisable for one-half of one share of the Company’s common stock at a price of $11.50 per whole share, subject to adjustment. Warrants may only be exercised for a whole number of shares as no fractional shares will be issued. As of December 31, 2023 and December 31, 2022, the Company had 20,193,120 and 19,491,320 Public Warrants outstanding, respectively, and 70,180 and 771,980 Private Warrants outstanding, respectively. The exercise price and number of ordinary shares issuable upon exercise of the Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. If the number of shares of common stock purchasable upon the exercise of the Warrants is adjusted, the Warrant price shall be adjusted proportionally. In no event will the Company be required to net cash settle the Warrants. Additionally, the Warrants became exercisable as of July 27, 2020 and expire five years from the date of the Business Combination or earlier upon redemption or liquidation. There were no Warrants exercised for shares of the Company’s common stock in the years ended December 31, 2023 and 2022. Public Warrants —The Public Warrants are subject to redemption by the Company: • in whole and not in part; • at a price of $0.01 per public warrant; • upon not less than 30 days’ prior written notice of redemption to each warrant holder; and • if, and only if, the reported last sale price of the ordinary shares for any 20 trading days within a 30-day trading period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders equals or exceeds $18 per share (as adjusted). The Company may not redeem the warrants as described above unless a registration statement under the Securities Act covering the issuance of the ordinary shares issuable upon exercise of the warrants is then effective and a current prospectus relating to those ordinary shares is available throughout the 30-day redemption period. If any such registration statement does not remain effective after closing of the Business Combination, the Company has the right to redeem the warrants on a “cashless” exercise basis. The public warrant holders only have the right to exercise their warrants pursuant to a “cashless” exercise if the Company does not maintain an effective registration statement. Private Warrants —The Private Warrants are identical to the Public Warrants, except that so long as they are held by the PIPE Investors or any permitted transferees, as applicable, the Private Warrants: (i) may be exercised for cash or on a cashless basis, (ii) were not allowed to be transferred, assigned or sold until thirty (30) days after the closing of the Business Combination, and (iii) shall not be redeemable by the Company. Upon the transfer of a Private Warrant to a party other than a PIPE Investor or a permitted transferee, the Private Warrants become Public Warrants and the fair market value of the Private Warrants at the date of transfer is reclassified to equity. See Note 1 for additional discussion. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | NOTE 9: FAIR VALUE MEASUREMENTS The Company measures and records in its consolidated financial statements certain assets and liabilities at fair value. ASC Topic 820 “Fair Value Measurement and Disclosures,” establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). This hierarchy consists of the following three levels: • Level 1 – Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market. • Level 2 – Assets and liabilities whose values are based on inputs other than those included in Level 1, including quoted market prices in markets that are not active; quoted prices of assets or liabilities with similar attributes in active markets; or valuation models whose inputs are observable or unobservable but corroborated by market data. • Level 3 – Assets and liabilities whose values are based on valuation models or pricing techniques that utilize unobservable inputs that are significant to the overall fair value measurement. Certain assets are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). Current Assets and Other Financial Assets and Liabilities— Cash and cash equivalents, trade accounts receivable and trade accounts payable are measured at carrying value, which approximates fair value because of the short-term maturities of these instruments. Certain of the Company’s cash equivalents are held in money market funds and are valued using Net Asset Value. Investment in Securities —The Company has assets in an investment fund that holds surplus funds from its terminated qualified pension plan that will be used to fund future contributions to the defined contribution plan at Flavors & Ingredients and is presented in other assets in the consolidated balance sheet. The investment is classified as available-for-sale and carried at fair market value. At December 31, 2023, both the estimated fair value and cost basis of the investment fund was $2.2 million. At December 31, 2022, both the estimated fair value and cost basis of the investment fund was $0.1 million. The estimated fair value of the investment fund utilized Level 2 inputs. Debt— The Company measures its term loan and revolving facilities at original carrying value, net of unamortized deferred financing costs and fees. At December 31, 2023, the estimated fair value of the term loan was $317.3 million as compared to a carrying value of $357.7 million. At December 31, 2022, the estimated fair value of the term loan was $338.0 million compared to a carrying value of $359.9 million. The estimated fair value of the outstanding principal balance of the term loan utilized Level 2 inputs as it is based on quoted market prices for identical or similar instruments. The fair value of the revolving facility at both December 31, 2023 and 2022 approximated carrying value. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 10: COMMITMENTS AND CONTINGENCIES The Company is subject to various claims, pending and possible legal actions for product liability and other damages, and other matters arising out of the conduct of the business. The Company believes, based on current knowledge and consultation with counsel, that the outcome of such claims and actions will not have a material adverse effect on the Company’s consolidated financial position or results of operations. As of December 31, 2023, the Company had obligations to purchase approximately $80.5 million and $3.8 million of raw material during 2024 and 2025, respectively. In addition, the Company had commitments under purchase obligations related to market data research and technology services totaling approximately $3.7 million, of which $2.5 million was short-term and $1.2 million was long-term. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 11: INCOME TAXES The Company’s provision for income taxes consists of U.S. federal, state and local, and foreign taxes. The Company has significant operations in various locations outside the U.S. The annual effective tax rate is a composite rate reflecting the earnings in the various locations at their applicable statutory tax rates. On October 8, 2021 the Organization for Economic Co-operation and Development “OECD”) released a statement on the OECD/G20 Inclusive Framework on Base Erosion and Profit Sharing, which agreed to a two-pillar solution to address tax challenges of the digital economy. On December 20, 2021, the OECD released Pillar Two model rules defining a 15 percent global minimum tax rate for large multinational corporations with consolidated revenue above €750 million. The OECD continues to release additional guidance and countries are implementing legislation with widespread adoption of the Pillar Two Framework expected by calendar year 2024. The Company continues to evaluate the Pillar Two Framework and its potential impact on future periods, however based on the current proposed revenue thresholds, the Company does not expect to be subject to tax changes associated with Pillar Two. Components of the income tax provision (benefit) were as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Current: Federal $ 1,912 $ (364) $ 916 State and local 725 419 283 Foreign 4,746 6,190 3,957 7,383 6,245 5,156 Deferred: Federal (1,082) (2,944) (6,498) State and local (70) (581) (2,801) Foreign 98 3,069 (3,001) (1,054) (456) (12,300) Total provision (benefit) for income taxes $ 6,329 $ 5,789 $ (7,144) The following is a reconciliation of income tax provision (benefit) computed at the U.S. federal statutory rate to income tax provision (benefit) in the consolidated statements of operations (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 (Loss) income before income taxes: Domestic $ (43,041) $ (86,952) $ (36,205) Foreign 11,274 33,989 29,144 Total (loss) income before income taxes $ (31,767) $ (52,963) $ (7,061) Federal income tax rate 21.0% 21.0% 21.0% Federal income taxes $ (6,671) $ (11,122) $ (1,483) State and local taxes (1,449) (1,666) (3,572) Foreign rate differential (325) (545) (1,431) Change in tax rates (5) 295 225 Change in uncertain tax positions 9 6 (1,005) Change in valuation allowance 12,480 4,588 2,657 Goodwill impairment 1,531 9,765 — U.S. effects of international operations 3,263 5,603 3,041 Tax credits (3,667) (3,250) (2,763) Section 162(m) limitation 475 87 206 Transaction costs — 31 385 Stock-based compensation 929 422 502 Switzerland tax ruling — — (4,057) Foreign withholding taxes 128 1,043 350 Other (369) 532 (199) Total provision (benefit) for income taxes $ 6,329 $ 5,789 $ (7,144) Effective tax rate (19.9)% (10.9)% 101.2% Significant components of the Company’s net deferred tax assets and liabilities were as follows (in thousands): December 31, 2023 December 31, 2022 Deferred tax assets: Accounts receivable $ 354 $ 441 Accrued expenses 5,442 4,938 Inventory 3,450 4,112 Deferred rent 24 — Other assets 1,690 1,184 Pension asset 2,466 2,320 Hedging 275 — Capitalized research and development expense 979 445 Lease accounting 5,695 5,458 U.S. and foreign net operating losses 19,568 19,150 Deferred interest expense 21,280 11,241 Tax credits 1,028 887 Total deferred tax assets 62,251 50,176 Less valuation allowance (27,747) (16,592) Net deferred tax assets $ 34,504 $ 33,584 Deferred tax liabilities: Property, plant and equipment (6,714) (6,270) Operating lease right-of-use asset (4,971) (4,621) Intangible assets (43,477) (45,964) Deferred rent — (63) Unremitted earnings (2,447) (2,295) Other liabilities (7,974) (6,417) Total deferred tax liabilities (65,583) (65,630) Net deferred tax liability $ (31,079) $ (32,046) In assessing the recoverability of its deferred tax assets within the jurisdiction from which they arise, management considers whether it is more likely than not (more than 50%) that some portion or all of the deferred tax assets will be realized. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income prior to the expiration of any net operating loss and tax credit carry forwards. The Company evaluates all positive and negative evidence when determining the amount of the net deferred tax assets that are more likely than not to be realized. This evidence includes, but is not limited to, prior earnings history, reversal of taxable temporary differences, tax planning strategies and projected future taxable income. Significant weight is given to positive and negative evidence that is objectively verifiable. Based on the weight of available evidence, including the scheduling of existing taxable temporary differences into future taxable income, the Company determined that as of December 31, 2023 its deferred tax assets were realizable on a more-likely-than not basis with the exception of certain U.S. federal and state interest carryforward deductions of $12.8 million for which the tax deduction is generally restricted to 30% of future tax adjusted earnings before interest and taxes (“EBIT”), foreign tax credits of $1.0 million, certain state net operating loss carry forwards of $10.4 million predominately related to Illinois, and $3.5 million of foreign net operating loss carry forwards in India, Luxembourg, Mexico, China and Argentina. The Company’s valuation allowance during 2023 increased by approximately $11.2 million, of which $12.5 million was charged to income tax expense in 2023 (as shown in the rate reconciliation table above), partially offset by foreign exchange translation adjustments. The Company received a beneficial Switzerland tax ruling in 2021 permitting a step up in the tax basis of intangible assets. The Company will be able to amortize the intangible assets over a 10-year period for Swiss tax purposes, resulting in future cash tax savings. The Company recognized a discrete tax benefit of $4.1 million in 2021 related to this change. As of December 31, 2023, the Company had net operating loss carry forwards and tax credits which will expire if not utilized, including: $123.7 million in Illinois state net operating losses expiring between 2029 and 2043, $1.0 million of U.S. federal foreign tax credits expiring in 2030 through 2033, $86.8 million of federal deferred interest carryforward under IRC Section 163(j) that can be carried forward indefinitely but is limited to 30% tax adjusted EBIT, $1.2 million of net operating losses in Mexico substantially expiring in 2023 and through 2032, $9.8 million of net operating losses in Luxembourg substantially expiring in 2035 and through 2040, $1.1 million of net operating losses in India expiring in 2024 through 2028, $0.4 million of net operating losses in China expiring in 2023 through 2026 and $1.6 million of net operating losses in Argentina expiring in 2027 through 2028. As of December 31, 2023 and 2022, the Company had accrued future income taxes and withholding taxes for future remittances to its Switzerland and Hong Kong affiliates of $2.4 million and $2.3 million, based on foreign earnings of $57.1 million and $56.1 million, respectively. As of both December 31, 2023 and 2022, the Company had a liability for unrecognized tax positions of $0.1 million. As of December 31, 2023, the entire amount if recognized, would reduce the Company’s effective tax rate. The Company records both accrued interest and penalties related to income tax matters in the provision for income taxes in the accompanying consolidated statements of operations. The Company’s accrued interest and penalties related to uncertain tax positions is not material. The Company does not expect its unrecognized tax benefits will significantly increase or decrease in the next 12 months. The Company is subject to taxation in the U.S. and various state and foreign jurisdictions. The Company’s U.S. federal and state income tax periods are generally open to examination for the tax years 2019 through 2023. The Company’s French, Argentina, Luxembourg and Swiss tax years 2018 through 2023 also remain open for examination. In addition, open tax years related to the Company’s other foreign jurisdictions remain subject to examination but are not considered material. |
PENSION AND OTHER RETIREMENTS B
PENSION AND OTHER RETIREMENTS BENEFITS | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
PENSION AND OTHER RETIREMENTS BENEFITS | NOTE 12: PENSION AND OTHER RETIREMENT BENEFITS Certain current and former employees of the Company are covered under a funded qualified defined benefit retirement plan at Flavors & Ingredients which was frozen on December 31, 2019. Plan provisions covering certain of the Company’s salaried employees generally provide pension benefits based on years of service and compensation. Plan provisions covering certain of the Company’s union members generally provide stated benefits for each year of credited service. In addition, the Company has unfunded non-qualified plans also at Flavors & Ingredients covering certain salaried employees with additional retirement benefits in excess of qualified plan limits imposed by federal tax law, which were frozen by the Company on December 31, 2022. The Company uses December 31 as a measurement date for the plans. The Company’s funding policy was to contribute annually the statutory required amount as actuarially determined. In February 2021, the Compensation Committee approved the termination of the Company’s qualified defined benefit retirement plan. During the fourth quarter of 2021, the Company offered the option of receiving a lump sum payment to certain participants with vested benefits in lieu of receiving monthly annuity payments. Approximately 125 participants elected to receive the settlement, and lump sum payments of approximately $16.8 million were paid from plan assets to these participants in December 2021. The benefit obligation settled approximated payments to plan participants and a pre-tax settlement gain of $0.5 million was recorded in the fourth quarter of 2021. During 2022, the Company purchased non-participating annuity contracts to settle the remaining liabilities of the plan for approximately $9.3 million which was fully funded by plan assets. The annuity contracts purchased along with the plan termination activities resulted in a settlement gain of $1.2 million for the year ended December 31, 2022. During the first quarter of 2023, the Company transferred the remaining surplus of the plan of approximately $2.5 million to a suspense account held within a trust for the Flavors & Ingredients defined contribution plan. The surplus consists of an investment fund measured at fair value which is being used, as prescribed in the applicable regulations, to fund current and future contributions to the defined contribution plan. See Note 9 for additional information. The following table reconciles the funded status of the Company’s defined benefit pension plans Year Ended December 31, 2023 December 31, 2022 Accumulated benefit obligations $ 7,941 $ 7,706 Changes in projected benefit obligations: Projected benefit obligations at beginning of year $ 7,706 $ 20,314 Service cost — 41 Interest cost 377 326 Actuarial loss (gain) 208 (3,084) Benefits paid (350) (9,891) Projected benefit obligations at end of year 7,941 7,706 Change in plans’ assets: Fair value of plans’ assets at beginning of year 2,522 12,902 Actual returns on plans’ assets 10 (349) Employer contributions 350 360 Benefits paid (419) (9,891) Transfers related to plan termination (2,463) (500) Fair value of plans’ assets at end of year — 2,522 Net pension liability $ (7,941) $ (5,184) The projected benefit obligation at December 31, 2023 and December 31, 2022 included $7.9 million and $7.7 million, respectively, related to the Company’s unfunded non-qualified plans. Amounts recognized in the Company’s consolidated balance sheets consisted of (in thousands): Year Ended December 31, 2023 December 31, 2022 Other assets $ — $ 2,522 Accrued expenses and other current liabilities (355) (355) Other liabilities (7,586) (7,351) Net amount recognized $ (7,941) $ (5,184) Amounts recognized in accumulated other comprehensive income (loss), net of tax, which have not yet been recognized as a component of net periodic pension expense for the Company’s defined benefit pension plans, are as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Net actuarial gain $ (1,323) $ (1,523) $ (207) $ (1,323) $ (1,523) $ (207) The components of the changes in unrecognized amounts included in pension obligation, net in other comprehensive income (loss) for the Company’s defined benefit pension plans were as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Net actuarial loss (gain) $ 152 $ (1,316) $ 527 Amortization of actuarial gain (loss) 48 — (36) Total loss (gain) recognized in other comprehensive income (loss) $ 200 $ (1,316) $ 491 The components of net periodic benefit cost (credit) for the Company’s defined benefit pension plans were as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Service cost $ — $ 41 $ 63 Interest cost 377 326 1,047 Expected return on plan assets — 144 (1,310) Amortization of net actuarial (gain) loss (63) — 36 Settlement loss (income) 59 (1,178) (644) Net periodic benefit cost (credit) $ 373 $ (667) $ (808) Net periodic benefit cost (credit) is reflected in the Company’s consolidated financial statements as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Selling, general and administrative expense $ — $ 41 $ 63 Other expense (income), net 373 (708) (871) Net periodic benefit cost (credit) $ 373 $ (667) $ (808) Assumptions —The following assumptions were used to determine the net periodic benefit cost during 2022 for the Company’s funded defined benefit pension plan: Year Ended December 31, 2022 Weighted-average assumptions used to determine net periodic benefit cost: Discount rate 2.38 % Expected long-term rate of return on plan assets 1.70 % The following assumptions were used to determine the benefit obligation at year end and net periodic benefit cost during the year for the Company’s unfunded supplemental defined benefit pension plan: Year Ended December 31, 2023 December 31, 2022 Weighted-average assumptions used to determine benefit obligation at year end: Discount rate 4.81 % 5.01 % Weighted-average assumptions used to determine net periodic benefit cost: Discount rate 5.01 % 2.78 % Rate of compensation increase — % 3.50 % The Company bases the discount rate assumption on current investment yields of high quality fixed income investments during the retirement benefits maturity period. The rate of increase in future compensation assumptions reflects the Company’s long-term actual experience and future and near-term outlook. The Company considered a number of factors to determine its expected rates of return on the assets in its plan, including, without limitation, historical performance of the plan assets, investment style, asset allocations and other third-party studies and surveys. The Company considered the plan portfolio’s asset allocation over a variety of time periods and compared them with third-party studies and reviewed performance of the capital markets in recent years and other factors and advice from various third parties, such as the pension plan’s advisors, investment managers and actuaries. While the Company considered recent performance and the historical performance of its plan assets, the Company’s assumptions are based primarily on its estimates of long-term, prospective rates of return. Differences between actual and expected asset returns are recognized in the net periodic benefit cost over the remaining service period of the active participating employees. Plan Assets —The investment committee for the Company’s plan adopted investment policies with the objective of meeting and exceeding over time, the expected long-term rate of return on plan assets assumptions, weighted against a reasonable risk level and considering the appropriate liquidity levels. In connection with this objective, the plan’s assets were mainly invested in mutual funds, common and collective funds, corporate bonds, government bonds, private equity funds, as well as a real estate fund, in order to achieve the Company’s goals to enhance the expected returns of its investments together with their liquidity and protect the plan’s funded status. As a result of the planned termination of the qualified pension plan, certain of the plan’s assets were liquidated during the fourth quarter of 2021 and used to satisfy lump sum benefit payments as further described above, and any remaining plan assets were liquidated during 2022. Therefore, at December 31, 2022 the remaining plan assets were invested in cash and cash equivalents. As discussed above, during the first quarter of 2023, the Company transferred the remaining surplus of the plan to a suspense account held within a trust for the Flavors & Ingredients defined contribution plan. The following tables set forth, by category, the Company’s pension plan assets as of December 31, 2022, using the fair value hierarchy established under ASC Topic 820 and as described in Note 9 (in thousands): Pension Plan Assets as of December 31, 2022 Level 1 Level 2 Level 3 Total Pension plan assets measured at fair value: Cash and cash equivalents $ 2,522 $ — $ — $ 2,522 Total pension plan assets measured at fair value $ 2,522 $ — $ — $ 2,522 Cash and cash equivalents are stated at cost, which approximates fair market value. There were no transfers between levels within the three-tier fair value hierarchy in 2022. Contributions —The Company does not expect to make further contributions to its funded defined benefit pension plan due to its termination. Expected Future Benefit Payments —The projected benefit payments for the unfunded non-qualified 2024 $ 355 2025 425 2026 592 2027 588 2028 583 2029-2033 3,177 The Company also participates in certain state-sponsored defined benefit plans covering certain non-U.S. employees with total net liabilities of $2.6 million and $1.9 million as of December 31, 2023 and December 31, 2022, respectively. The primary state-sponsored plan relates to Merisant employees in Switzerland and France, which had pension benefit obligations of $5.3 million and plan assets of $2.7 million as of December 31, 2023 and a pension benefit obligation of $5.5 million and plan assets of $3.6 million as of December 31, 2022. Net periodic pension cost for 2023, 2022, and 2021 was $0.1 million, $0.4 million, and $0.4 million, respectively. Defined Contribution Pension Plans —The Company has defined contribution 401(k) plans covering certain eligible domestic employees, as defined by the plans. The plans provide for certain employer matching contributions. The Company recorded compensation expense related to its defined contribution plans of $1.2 million for both 2023 and 2022, and $1.0 million for 2021. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 13: STOCK-BASED COMPENSATION On June 24, 2020, the Whole Earth Brands, Inc. 2020 Long-Term Incentive Plan (the “Plan”) was approved for the purpose of promoting the long-term financial interests and growth of the Company and its subsidiaries by attracting and retaining management and other personnel and key service providers. On June 8, 2023, the Company’s stockholders’ approved the Amended and Restated Whole Earth Brands, Inc. 2020 Long-Term Incentive Plan (the “Amended 2020 Plan”), which increased the number of shares authorized under the Amended 2020 Plan by 4,000,000 shares. Subsequent to the amendment and restatement, an aggregate of 13,300,000 shares of common stock are authorized for issuance under the Amended 2020 Plan. The Plan provides for the granting of stock options (“SOs”), stock appreciation rights (“SARs”), restricted stock awards (“RSAs”), restricted stock units (“RSUs”), performance shares, performance share units (“PSUs”) and other stock-based awards to officers, employees and non-employee directors of, and certain other service providers to, the Company and its subsidiaries. These awards are settled in shares of the Company’s stock and therefore classified as equity awards. The RSUs and RSAs are accounted for as equity awards and have a grant-date fair value equal to the fair market value of the underlying stock on the grant date. RSUs granted generally vest ratably on the anniversary of the grant date over a period of one PSU awards generally cliff vest subsequent to the completion of the cumulative three-year performance period, depending on the period specified in each respective PSU agreement. The number of PSUs that ultimately vest depends on the Company’s performance relative to a specified cumulative financial targets established for each grant and are expected to be settled in stock. Stock-based compensation expense for the years ended December 31, 2023, 2022 and 2021 was $7.0 million, $4.9 million, and $8.7 million, respectively. Stock-based compensation expense for the year ended December 31, 2021 included $0.9 million of expense related to 2021 management bonuses that were settled in stock during the second quarter of 2022. The tax benefit recognized related to stock-based compensation was $0.9 million, $0.4 million and $0.5 million for the years ended December 31, 2023, 2022 and 2021, respectively. A summary of activity and weighted average fair values related to the RSUs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2022 1,538,759 $ 6.65 0.71 Granted 3,023,061 2.55 Vested (1,224,235) 6.25 Forfeited (1,220,914) 2.97 Outstanding and nonvested at December 31, 2023 2,116,671 $ 3.19 1.12 The weighted average grant date fair value per share of RSUs granted during the year was $2.55 in 2023, $5.42 in 2022 and $13.48 in 2021. The aggregate fair value of RSUs upon vesting during the years ended December 31, 2023, 2022 and 2021 was $4.2 million, $1.5 million and $7.2 million, respectively. A summary of activity and weighted average fair values related to the RSAs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2022 131,470 $ 8.75 1.19 Granted 141,280 4.07 Vested (58,194) 11.00 Outstanding and nonvested at December 31, 2023 214,556 $ 5.06 1.16 The weighted average grant date fair value per share of RSAs granted during the year was $4.07 in 2023, $6.96 in 2022, and $11.77 in 2021. The aggregate fair value of RSAs upon vesting during the years ended December 31, 2023 and 2022 was $0.2 million and $0.5 million, respectively. No RSAs vested during the year ended December 31, 2021. A summary of activity and weighted average fair values related to the PSUs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2022 631,377 $ 8.49 1.88 Granted 1,934,388 2.20 Forfeited (1,035,405) 3.06 Outstanding and nonvested at December 31, 2023 1,530,360 $ 4.21 1.81 The weighted average grant date fair value per share of PSUs granted during the year was $2.20 in 2023, $7.19 in 2022 and $13.65 in 2021. As of December 31, 2023, the Company had not yet recognized compensation cost on nonvested awards as follows (in thousands): Unrecognized Weighted Avg. Nonvested awards $ 7,243 1.39 The nonvested awards excludes unvested PSUs that are deemed not probable of vesting constituting $4.4 million of unrecognized compensation expense at December 31, 2023. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | NOTE 14: EARNINGS PER SHARE Basic earnings (loss) per common share (“EPS”) is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Warrants issued are not considered outstanding at the date of issuance. RSUs and RSAs also are not considered outstanding until they have vested. Contingently issuable shares associated with outstanding PSUs that have cliff vesting based on achievement of a performance condition were not included in the earnings per share calculations for the periods presented as the applicable vesting conditions had not been satisfied. Diluted EPS is calculated by dividing net income (loss) by the weighted average shares outstanding assuming dilution. Dilutive common shares outstanding is computed using the treasury stock method and reflects the additional shares that would be outstanding if dilutive warrants were exercised and restricted stock units and restricted stock awards were settled for common shares during the period. For warrants that are liability-classified, during the periods when the impact would be dilutive, the Company assumes share settlement of the instruments as of the beginning of the reporting period and adjusts the numerator to remove the change in the fair value of warrant liability and adjusts the denominator to include the dilutive shares using the treasury stock method. The computation of basic and diluted EPS for the years ended December 31, 2023, 2022 and 2021 is shown below (in thousands, except for share and per share data): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 EPS numerator: Net (loss) income attributable to common shareholders $ (38,096) $ (58,752) $ 83 Less: Change in fair value of warrant liabilities — — (29) Numerator - diluted $ (38,096) $ (58,752) $ 54 EPS denominator: Weighted average shares outstanding - basic 42,483,083 41,481,079 38,505,458 Effect of dilutive securities — — 1,370,929 Weighted average shares outstanding - diluted 42,483,083 41,481,079 39,876,387 Net earnings (loss) per share: Basic $ (0.90) $ (1.42) $ 0.00 Diluted $ (0.90) $ (1.42) $ 0.00 For the year ended December 31, 2023, 20,263,300 warrants, 2,116,671 RSUs, and 214,556 RSAs were excluded from the diluted EPS calculation because they were determined to be anti-dilutive. For the year ended December 31, 2022, 20,263,300 warrants, 1,538,759 RSUs, and 131,470 RSAs were excluded from the diluted EPS calculation because they were determined to be anti-dilutive. Additionally, at December 31, 2023, 2022 and 2021, 1,530,360, 631,377 and 282,141 PSUs, respectively, were excluded from the diluted EPS calculation because they are subject to performance conditions that were not satisfied. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 12 Months Ended |
Dec. 31, 2023 | |
AOCI Attributable to Parent [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | NOTE 15: ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following table summarizes accumulated other comprehensive income (loss) (“AOCI”), net of taxes, by component (in thousands): Net Currency Cash Flow Hedges Funded Status of Benefit Plans Total Balance at December 31, 2021 $ 8,758 $ — $ 929 $ 9,687 Other comprehensive (loss) income before reclassifications (13,469) — 2,926 (10,543) Amounts reclassified from AOCI — — (186) (186) Balance at December 31, 2022 $ (4,711) $ — $ 3,669 $ (1,042) Other comprehensive income (loss), before reclassifications 11,787 (28) (544) 11,215 Amounts reclassified from AOCI — (720) (204) (924) Balance at December 31, 2023 $ 7,076 $ (748) $ 2,921 $ 9,249 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 16: RELATED PARTY TRANSACTIONS In July 2020, the Company entered into an agreement with Watermill Institutional Trading LLC, a registered broker-dealer (“Watermill”), to act as one of the Company’s financial advisors for a 12-month period commencing July 22, 2020 for total consideration of $0.9 million, of which $0.5 million was expensed during the year ended December 31, 2021. Additionally, under the terms of the agreement, the Company incurred additional expense of $2.0 million during the year ended December 31, 2021 related to services provided by Watermill in connection with the acquisition of Wholesome. A former director of Act II is a registered representative of Watermill and provided services directly to the Company under the agreement. In December 2019, Wholesome entered into a partnership agreement with Sucro Can International, LLC (“Sucro”) to form WS Services, LLC (“WS Services”), in which Wholesome received a 50% interest and accounted for the partnership as an equity method investment. During the years ended December 31, 2023 and 2022, Wholesome expensed $0.7 million and $0.9 million, respectively, related to costs incurred by WS Services for Wholesome’s use of warehouse space for storage of raw materials and has a liability to WS Services for $0.1 million at both December 31, 2023 and 2022. On December 31, 2023, Wholesome sold its 50% partnership interest to Sucro and exited the partnership in exchange for a $0.2 million promissory note, plus accrued interest, due on March 30, 2024 and recorded a loss on the sale of the equity method investment of $0.5 million, which is included in other (expense) income, net in the consolidated statement of operations. Wholesome’s investment in the partnership, which was classified as other assets in the consolidated balance sheets, was $0.7 million as of December 31, 2022. |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
BUSINESS SEGMENTS | NOTE 17: BUSINESS SEGMENTS The Company has two reportable segments: Branded CPG and Flavors & Ingredients. In addition, the Company’s corporate office functions are reported and included under Corporate. Corporate is not a reportable or operating segment but is included for reconciliation purposes and includes the costs for the corporate office administrative activities as well as transaction-related and other costs. Certain prior year amounts have been reclassified to conform to the current presentation. The Company does not present assets by reportable segments as they are not reviewed by the Chief Operating Decision Maker for purposes of assessing segment performance and allocating resources. The following table presents selected financial information relating to the Company’s business segments (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Product revenues, net Branded CPG $ 426,287 $ 422,638 $ 389,174 Flavors & Ingredients 124,626 115,634 104,799 Total product revenues, net $ 550,913 $ 538,272 $ 493,973 Operating income (loss) Branded CPG $ 8,167 $ (30,182) $ 34,918 Flavors & Ingredients 35,681 32,505 21,860 43,848 2,323 56,778 Corporate (28,453) (26,969) (33,962) Total operating income (loss) $ 15,395 $ (24,646) $ 22,816 The following table presents geographic information based upon revenues of the Company’s major geographic markets (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 North America $ 366,207 $ 357,175 $ 318,958 Europe 95,095 92,272 96,013 India, Middle East and Africa 16,201 19,940 14,801 Asia-Pacific 57,731 53,300 51,598 Latin America 15,679 15,585 12,603 Total product revenues, net $ 550,913 $ 538,272 $ 493,973 The Company has a large and diverse customer base, which includes numerous customers located in foreign countries. Branded CPG’s combined sales to a single customer accounted for 13.8%, 14.1% and 10.6% of total sales in 2023, 2022 and 2021, respectively. With the exception of the United States, no one country represented more than 10% of the Company’s net sales. The Company has an exclusive supply contract to purchase the output of licorice extract and certain licorice derivatives from a manufacturer with facilities in Central Asia. For the year ended December 31, 2023, the Company’s purchases from this supplier totaled approximately $13.0 million, representing 32.1% of the Company’s licorice raw material purchases for the year. Long-lived assets are as follows (in thousands): December 31, 2023 December 31, 2022 Long-Lived Assets* United States $ 20,990 $ 24,516 China 14,421 14,805 Czech Republic 6,355 6,451 France 12,079 10,960 Other Foreign Countries 1,092 1,360 Total $ 54,937 $ 58,092 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 18: SUBSEQUENT EVENTS On February 12, 2024, the Company entered into an Agreement of Merger (the “ Merger Agreement ”) with Ozark Holdings, LLC, a Delaware limited liability company (“ Parent ”) and Sweet Oak Merger Sub, LLC, a Delaware limited liability company and a wholly-owned subsidiary of Parent (“ Merger Sub ”). Upon the terms and subject to the conditions set forth in the Merger Agreement, upon the closing of the transaction, Merger Sub is expected to merge with and into the Company (the “ Merger ”), with the Company surviving the Merger as a wholly-owned subsidiary of Parent. The transaction is expected to close in the second calendar quarter of 2024, subject to the satisfaction of closing conditions contained in the Merger Agreement, including approval of the Merger by (a) the holders of a majority in voting power of the Company’s outstanding common stock, voting as a single class, and (b) the holders of sixty-six and two-thirds percent of the outstanding common stock not owned by Parent or any Parent Affiliated Persons (as defined in the Merger Agreement ). Upon completion of the transaction, the Company’s common stock will no longer be publicly listed and the Company will become a privately-held company. Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger (the “ Effective Time ”): • each share of the Company’s common stock issued and outstanding immediately prior to the Effective Time (other than (i) shares of common stock owned by the Company, its wholly owned subsidiaries, Parent or any of Parent’s affiliates and (ii) dissenting shares of common stock ) will be converted into the right to receive cash consideration equal to $4.875 per share of common stock (the “ Per Share Merger Consideration ”); • each warrant to purchase shares of common stock outstanding immediately prior to the Effective Time shall, without any action on the part of the holder thereof, cease to represent a warrant to purchase shares of common stock and instead represent a right by the holder upon any subsequent exercise of such warrant to receive the Per Share Merger Consideration, provided that if the holder of such warrant properly exercises such warrant within 30 days following the public disclosure of the consummation of the Merger in a current report on Form 8-K, the exercise price of such warrant will be reduced by an amount equal to the difference (but in no event less than zero) of (i) the exercise price of such warrant in effect prior to such reduction minus (ii) (A) the Per Share Merger Consideration minus (B) the Black-Scholes value of such warrant; • each award of restricted common stock will become immediately fully vested and treated as a share of common stock issued and outstanding immediately prior to the Effective Time; • each restricted stock unit award with respect to shares of common stock will become fully vested and, after giving effect to such vesting, automatically be cancelled and converted into the right to receive an amount in cash (less any applicable tax withholding) equal to (A) the total number of shares of common stock underlying such award, multiplied by (B) the Per Share Merger Consideration; and • each performance-based restricted stock unit award with respect to shares of common stock will become fully vested based on target level achievement of all performance targets (without application of any modifier) and, after giving effect to such vesting, automatically be cancelled and converted into the right to receive an amount in cash (less any applicable tax withholding) equal to (Y) the total number of shares of common stock underlying such award, multiplied by (Z) the Per Share Merger Consideration. The Merger Agreement contains customary representations, warranties and covenants of the Company, Parent and Merger Sub, including, among others, covenants by the Company (i) to conduct its business in the ordinary course during the period between the execution of the Merger Agreement and consummation of the Merger and (ii) not to engage in certain expressly enumerated transactions during such period. Under the terms of the Merger Agreement, the Company is subject to a customary “no-shop” provision that restricts the Company and its representatives from soliciting a Takeover Proposal (as defined in the Merger Agreement) from third parties or providing information to or participating in any discussions or negotiations with third parties regarding any Takeover Proposal. However, prior to the receipt of the requisite approval of the holders of common stock, the “no-shop” provision permits the Company, under certain circumstances and in compliance with certain obligations set forth in the Merger Agreement, to provide non-public information and engage in discussions and negotiations with respect to an unsolicited Takeover Proposal that would reasonably be expected to lead to a Superior Proposal (as defined in the Merger Agreement). The Merger Agreement also contains certain termination rights for the Company and Parent, with a termination fee of $20 million payable by the Company to Parent under certain circumstances and a termination fee of $40 million payable by Parent to the Company under certain circumstances. In addition, the Company or Parent may terminate the Merger Agreement if the Merger is not consummated by August 12, 2024. The Merger Agreement, the Merger and the transactions contemplated thereby were (i) unanimously recommended by a special committee of the board of directors of the Company (the “Board”), consisting solely of disinterested members of the Board, on February 12, 2024 and (ii) unanimously approved by the disinterested members of the Board on February 12, 2024. The foregoing descriptions of the Merger, the Merger Agreement, and the transactions contemplated thereby are not complete and are qualified in their entirety by the full text of the Merger Agreement, which is attached as an exhibit to this Annual Report on Form 10-K, and described in more detail in Item 1.01 of the Company’s Form 8-K filed with the SEC on February 13, 2024. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||
Net (loss) income | $ (38,096) | $ (58,752) | $ 83 |
Insider Trading Arrangements
Insider Trading Arrangements | 12 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
BASIS OF PRESENTATION AND SIG_2
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation —The consolidated financial statements include the accounts of Whole Earth Brands, Inc., and its indirect and wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates —The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from these estimates. |
Reclassifications | Reclassifications —Certain previously reported amounts have been reclassified to conform to the current presentation. |
Cash and Cash Equivalents | Cash and Cash Equivalent s—The Company considers all cash on hand, money market funds, and other highly liquid debt instruments with a maturity, when purchased, of three months or less to be cash and cash equivalents. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Credit Losses —Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for credit losses is the Company’s best estimate of the amount of probable losses in its existing accounts receivable based on historical and expected losses and current economic conditions. Account balances are charged against the allowance when the Company believes it is probable the receivable will not be recovered. The Company does not have any off-balance sheet credit exposure related to its customers. Recoveries of accounts receivable previously offset against the allowance are recorded in the consolidated statements of operations when received. A summary of the activity with respect to the accounts receivable allowances is as follows (in thousands): Accounts receivable allowance balance at December 31, 2020 $ 955 2021 additions charged to revenues, costs and expenses 1,783 2021 deductions and other (1,453) Accounts receivable allowance balance at December 31, 2021 $ 1,285 2022 additions charged to revenues, costs and expenses 2,711 2022 deductions and other (2,382) Accounts receivable allowance balance at December 31, 2022 $ 1,614 2023 additions charged to revenues, costs and expenses 2,671 2023 deductions and other (2,825) Accounts receivable allowance balance at December 31, 2023 $ 1,460 |
Inventories | Inventories —Inventories are stated at the lower of cost or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal, and transportation. The cost of inventory is determined by the first in, first out or average cost methods. |
Property, Plant and Equipment | Property, Plant and Equipment —Property, plant and equipment are recorded at cost. Additions, improvements, and replacements that extend asset life are capitalized. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful lives of the Company’s property, plant and equipment in service currently ranges as follows: 3 to 40 years for buildings and 1 to 20 years for all other equipment. When property and equipment are disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gains or losses are included in income from operations. Ordinary repairs and maintenance costs are charged to operating expense as incurred. |
Deferred Software Costs | Deferred Software Costs —Deferred implementation costs for hosted cloud computing service arrangements are stated at historical cost and amortized on a straight-line basis over the term of the hosting arrangement that the implementation costs relate to. Deferred implementation costs are included in other assets and amortized to selling, general and administrative expenses (“SG&A”). The corresponding cash flows related to deferred software costs will be reported within operating activities consistent with the treatment for payments associated with the service component of the hosting arrangement. The Company reviews the deferred implementation costs for impairment when it believes the deferred costs may no longer be recoverable. As of both December 31, 2023 and 2022, deferred software costs associated with cloud computing arrangements were $2.1 million. Costs of $0.8 million were amortized during 2023. No costs were amortized during 2022 or 2021. |
Leases | Leases —The Company accounts for leases pursuant to Accounting Standards Codification (“ASC”) Topic 842, “Leases.” Under ASC Topic 842, a right-of-use asset and a lease liability is recorded for all leases with a term greater than 12 months. Lease right-of-use assets and lease liabilities are initially recognized based on the present value of the future minimum lease payments over the lease term at commencement date calculated using our incremental borrowing rate applicable to the lease asset, unless the implicit rate is readily determinable. The Company’s leases include manufacturing facilities, office space, warehouses, material handling equipment, vehicles and office equipment. All of our leases are classified as operating leases. |
Goodwill and Other Indefinite-Lived Intangible Assets | Goodwill and Other Indefinite-Lived Intangible Assets —Goodwill and other indefinite-lived intangible assets are summarized in Note 6. The Company reviews goodwill and other indefinite-lived intangible assets for impairment annually, or more frequently if events or changes in circumstances indicate that an asset may be impaired, in accordance with ASC Topic 350, “Intangibles—Goodwill and Other.” Under ASC Topic 350, the impairment review of goodwill and other intangible assets not subject to amortization must be based on estimated fair values. The Company’s annual impairment review measurement date is in the fourth quarter of each year. In performing the annual assessment, the Company has the option of performing a qualitative assessment to determine if it is more likely than not that a reporting unit has been impaired. As part of the qualitative assessment for the reporting units, the Company evaluates the factors that are specific to the reporting units as well as industry and macroeconomic factors (including changes in interest and discount rates). The reporting unit specific factors may include cost factors, a comparison of current year results to prior year, current year budget and future projected financial performance. The Company also considers the change in the overall enterprise value of the Company compared to the prior year. If the Company determines that it is more likely than not that a reporting unit is impaired or if the Company elects not to perform the optional qualitative assessment, a quantitative assessment is performed utilizing both the income and market approaches to estimate the fair value of its reporting units. The income approach involves discounting future estimated cash flows. The discount rate used is the value-weighted average of the reporting unit’s estimated cost of equity and debt derived using both known and estimated customary market metrics adjusted for company specific risks. The Company performs sensitivity tests with respect to growth rates and discount rates used in the income approach. In applying the market approach, valuation multiples are derived from historical and projected operating data of selected guideline companies; evaluated and adjusted, if necessary, based on the strengths and weaknesses of the reporting unit relative to the selected guideline companies; and applied to the appropriate historical and/or projected operating data to arrive at an indication of fair value. The Company typically weights the results of the income and market approaches equally. If the reporting unit’s carrying value exceeds its estimated fair value, then an impairment is recorded for the difference, limited to the total amount of goodwill allocated to the reporting unit. The Company typically evaluates impairment of indefinite-lived intangible assets, which relates to our product formulations, by first performing a qualitative assessment. If the Company elects to bypass the qualitative assessment or determines that it is more likely than not that the fair value of the product formulations is less than its carrying value, a quantitative assessment is then performed using the relief from royalty method under the income approach to estimate the fair value. Some of the more significant assumptions inherent in estimating the fair value include the estimated future annual sales, royalty rates (as a percentage of sales that would hypothetically be charged by a licensor of the brand to an unrelated licensee), income tax considerations and a discount rate that reflects the level of risk. |
Impairment Review of Long-Lived Assets | Impairment Review of Long-Lived Assets —In accordance with ASC Topic 360, “Property, Plant and Equipment,” the Company evaluates the carrying value of long-lived assets to be held and used whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset or asset group may be impaired. When such events occur, the Company compares the sum of the future undiscounted cash flows expected to be generated from the asset or asset group over its remaining depreciable life to the carrying value. If this comparison indicates that there is an impairment, the carrying amount of the long-lived asset would then be reduced to the estimated fair value, which generally approximates discounted cash flows. The Company also evaluates the amortization periods of assets to determine whether events or circumstances warrant revised estimates of useful lives. The Company’s applicable long-lived assets include its property, plant and equipment, operating lease right-of-use assets and definite-lived intangible assets. |
Income Taxes | Income Taxes —The provision for income taxes is determined using the asset and liability method in accordance with ASC Topic 740, “Accounting for Income Taxes.” The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized. The Company made a policy election to treat the income tax due on United States (“U.S.”) inclusion of the global intangible low taxed income (“GILTI”) provisions as a period expense when incurred. Uncertainty in Income Taxes —The Company accounts for uncertain tax positions in accordance with the authoritative guidance issued under ASC Topic 740, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. The Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. The Company provides loss contingencies for federal, state and international tax matters relating to potential tax examination issues, planning initiatives and compliance responsibilities. The development of these reserves requires judgements about tax issues, potential outcomes and timing, which if different, may materially impact the Company’s financial condition and results of operations. The Company classifies interest and penalties associated with income taxes as a component of provision (benefit) for income taxes in the consolidated statements of operations. |
Pension Plans | Pension Plans |
Research and Development Costs | Research and Development Costs |
Stock-Based Compensation | Stock-Based Compensation |
Revenue Recognition | Revenue Recognition —In accordance with ASC Topic 606, “Revenue from Contracts with Customers,” the Company recognizes revenue when control of the promised goods or services is transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Revenues are primarily derived from customer orders for the purchase of products and are generally recognized when the product is shipped or delivered depending on the arrangement with the customer. The Company made an accounting policy election to exclude from the measurement of the transaction price sales taxes and all other items of a similar nature, and also elected to account for shipping and handling activities as a fulfillment of the promise to transfer the goods. Accordingly, shipping and handling costs are included in cost of sales. Branded CPG may offer promotional activities (e.g. coupons, trade discounts and other promotional activities) to its customers. These variable consideration amounts are estimated for each customer based on specific arrangements/agreements, an analysis of historical volume, and/or current activity with that customer. Reassessment of variable consideration estimates is done at each reporting date throughout the contract period until the uncertainty is resolved (e.g. promotional campaign is closed and settled with customer). Historically, the Company has encountered limited instances whereby customers rejected products as a result of orders being materially inaccurate and/or products being defective. The Company tracks the reason codes for those customer returns. Based on that, the materiality of such returns is assessed. A return reserve is calculated (based on historical data as described above) every month to record an adjustment to net sales; these adjustments have not been significant. The following table presents the Company’s revenues disaggregated by product categories (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Sweeteners and adjacencies $ 426,287 $ 422,638 $ 389,174 Licorice products 124,626 115,634 104,799 Total product revenues, net $ 550,913 $ 538,272 $ 493,973 The following table presents revenues disaggregated by business and geographic region (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Branded CPG: North America $ 305,849 $ 299,871 $ 266,661 Europe 70,405 67,962 76,392 India, Middle East and Africa 13,854 17,828 13,363 Asia-Pacific 21,436 22,371 20,787 Latin America 14,743 14,606 11,971 Flavors & Ingredients 124,626 115,634 104,799 Total product revenues, net $ 550,913 $ 538,272 $ 493,973 The Company records an allowance for credit losses as an estimate of the inability of its customers to make their required payments. The determination of the allowance requires the Company to make assumptions about the future ability to collect amounts owed from customers. |
Marketing and Advertising Costs | Marketing, Advertising, Consumer Incentives and Trade Promotions —The Company promotes its products with marketing activities, including advertising, consumer incentives and trade promotions. On an annual basis, advertising costs are expensed as incurred or in the year in which the related advertisement initially appears. Marketing and advertising expense was $12.0 million in 2023, $11.8 million in 2022, $17.0 million in 2021. Consumer incentive and trade promotion activities are deducted from revenue based on amounts estimated as being or becoming due to customers and consumers at the end of a period, based principally on the Company’s historical utilization and redemption rates. These deductions are estimated and recorded upon sale of product by the Company and revised as necessary at each period end. |
Fair Value of Financial Instruments | Fair Value Measurements —The Company measures fair value using a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The Company measures and records in its consolidated financial statements certain assets and liabilities at fair value. ASC Topic 820 “Fair Value Measurement and Disclosures,” establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). This hierarchy consists of the following three levels: • Level 1 – Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market. • Level 2 – Assets and liabilities whose values are based on inputs other than those included in Level 1, including quoted market prices in markets that are not active; quoted prices of assets or liabilities with similar attributes in active markets; or valuation models whose inputs are observable or unobservable but corroborated by market data. • Level 3 – Assets and liabilities whose values are based on valuation models or pricing techniques that utilize unobservable inputs that are significant to the overall fair value measurement. Certain assets are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). Current Assets and Other Financial Assets and Liabilities— Cash and cash equivalents, trade accounts receivable and trade accounts payable are measured at carrying value, which approximates fair value because of the short-term maturities of these instruments. Certain of the Company’s cash equivalents are held in money market funds and are valued using Net Asset Value. Investment in Securities —The Company has assets in an investment fund that holds surplus funds from its terminated qualified pension plan that will be used to fund future contributions to the defined contribution plan at Flavors & Ingredients and is presented in other assets in the consolidated balance sheet. The investment is classified as available-for-sale and carried at fair market value. At December 31, 2023, both the estimated fair value and cost basis of the investment fund was $2.2 million. At December 31, 2022, both the estimated fair value and cost basis of the investment fund was $0.1 million. The estimated fair value of the investment fund utilized Level 2 inputs. Debt— The Company measures its term loan and revolving facilities at original carrying value, net of unamortized deferred financing costs and fees. At December 31, 2023, the estimated fair value of the term loan was $317.3 million as compared to a carrying value of $357.7 million. At December 31, 2022, the estimated fair value of the term loan was $338.0 million compared to a carrying value of $359.9 million. The estimated fair value of the outstanding principal balance of the term loan utilized Level 2 inputs as it is based on quoted market prices for identical or similar instruments. The fair value of the revolving facility at both December 31, 2023 and 2022 approximated carrying value. On June 9, 2023, the Company entered into an interest rate swap with a notional value of $183.3 million that matures on February 5, 2026 to exchange variable for fixed rate interest payments related to the Term Loan Facility. The effective date of the interest rate swap was June 30, 2023. The interest rate swap is designated as a cash flow hedge and is considered highly effective. As a result, no ineffectiveness has been recognized in the consolidated statement of operations during the year ended December 31, 2023. As of December 31, 2023, the fair value of the interest rate swap was recorded in accrued expenses and other current liabilities in the consolidated balance sheet in the amount of approximately $1.0 million with the unrealized loss recognized in other comprehensive income (loss). The change in fair value will subsequently be reclassified from other comprehensive income (loss) to interest expense, net in the periods when the hedge transaction affects earnings. Realized gains, net of tax of $0.7 million were reclassified to net income during the year ended December 31, 2023. As of December 31, 2023, the Company expects approximately $0.8 million of unrealized gain to be reclassified from other comprehensive income (loss) to interest expense, net over the next twelve months. The interest rate swap fair value is considered Level 2 within the fair value hierarchy as it includes quoted market prices for similar instruments as well as interest rates and yield curves that are observable in the market. |
Major Customers and Credit Concentration | Major Customers and Credit Concentration —The Company sells products to customers in the U.S. and internationally. The Company performs ongoing credit evaluations of customers, and generally does not require collateral on trade accounts receivable. Allowances are maintained for potential credit losses and such losses have been within management’s expectations. |
Foreign Currency Translation | Foreign Currency Translation —The Company has determined that the functional currency for each combined subsidiary is its local currency, except for certain entities whose functional currency is the U.S. dollar. Assets and liabilities of entities outside the U.S. are translated into U.S. dollars at the exchange rates in effect at the end of each period and income statement accounts are translated at each period’s average exchange rate. Translation adjustments arising from the use of differing exchange rates from period to period are included as a component of accumulated other comprehensive income (loss) on the balance sheet, except for any entities which may operate in highly inflationary economies. Gains and losses resulting from transactions in other than functional currencies are reflected in operating results, except for transactions of a long-term nature. Remeasurements of European entities whose functional currency is the U.S. dollar as well as translation adjustments for entities operating in highly inflationary economies and impacts of foreign currency transactions are recognized currently in other income (expense), net in the accompanying consolidated statements of operations. The Company had foreign exchange losses, net of $3.3 million in 2023, foreign exchange gains, net of $0.1 million in 2022, and foreign exchange losses of $0.2 million in 2021. Beginning January 1, 2019, the Company was required to apply highly-inflationary accounting to its Argentinian subsidiary. This accounting treatment requires a change in the subsidiary’s functional currency from the local currency (Argentinian Peso) to the parent’s reporting currency (USD). This highly-inflationary classification results from the fact that the cumulative inflation rate for the preceding 3 year period exceeded 100 percent as of June 30, 2018. Accordingly, effective January 1, 2019, all Argentinian Peso denominated monetary assets and liabilities are considered foreign currency denominated assets and liabilities and are revalued to USD (the functional currency) with remeasurement adjustments in the period recorded in the statement of operations. The USD will be the functional currency until the economic environment in Argentina ceases to be considered highly-inflationary. The Company recorded $1.8 million of expense related to remeasurement adjustments for Argentina in the consolidated statements of operations for the year ended December 31, 2023, $1.2 million of expense for the year ended December 31, 2022 and $0.3 million of expense for the year ended December 31, 2021. |
Restructuring and Employee Termination Benefits | Restructuring and other expenses —In previous years the Company adopted restructuring plans to streamline processes and realize cost savings by consolidating facilities and eliminating various positions in operations and general and administrative areas. In connection with the restructuring plans, the Company recognized restructuring and other expenses of $4.5 million during the year ended December 31, 2021. This included facility exit and other related costs of $3.9 million and employee termination benefits of $0.6 million in 2021. The Company had no accrued severance expense related to the restructuring plans as of both December 31, 2023 and December 31, 2022. Termination benefits are payable when an employee is involuntarily terminated, or whenever an employee accepts voluntary termination in exchange for termination benefits. One-time involuntary termination benefits are recognized as a liability when the termination plan meets certain criteria and has been communicated to employees. If employees are required to render future service in order to receive these one-time termination benefits, the liability is recognized ratably over the future service period. |
Warrant Liabilities | Warrant Liabilities —The Company accounts for the Private Warrants in accordance with ASC Topic 815, “Derivatives and Hedging.” Under the guidance contained in ASC Topic 815-40, the Private Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Private Warrants as liabilities at their fair value and adjusts the warrants to fair value at each reporting period. The liability is subject to re-measurement at each balance sheet date, and any change in fair value is recognized in the Company’s statement of operations. |
Accounting Standards Adopted in the Current Year and Accounting Standards Not Yet Adopted | Accounting Standards Adopted in the Current Year —The Company qualifies as an emerging growth company (an “EGC”) and as such, has elected the extended transition period for complying with certain new or revised accounting pronouncements. During the extended transition period, the Company is not subject to certain new or revised accounting standards applicable to public companies. The accounting pronouncements pending adoption below reflect effective dates for the Company as an EGC with the extended transition period. In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments - Credit Losses (Topic 326).” The standard requires entities to estimate losses on financial assets measured at amortized cost, including trade receivables, debt securities and loans, using an expected credit loss model. The expected credit loss model should consider reasonable and supportable forecasts in addition to the previously considered past events and current conditions. This guidance also includes enhanced requirements for disclosures related to credit loss estimates. Entities must apply the standard provision as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The Company adopted this standard on January 1, 2023. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures and a cumulative-effect adjustment was not deemed necessary. Accounting Standards Not Yet Adopted —In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”. The standard expands segment disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. The standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company is currently evaluating the impact of adopting ASU 2023-07 on its consolidated financial statement disclosures. |
Earnings Per Share | Basic earnings (loss) per common share (“EPS”) is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Warrants issued are not considered outstanding at the date of issuance. RSUs and RSAs also are not considered outstanding until they have vested. Contingently issuable shares associated with outstanding PSUs that have cliff vesting based on achievement of a performance condition were not included in the earnings per share calculations for the periods presented as the applicable vesting conditions had not been satisfied. Diluted EPS is calculated by dividing net income (loss) by the weighted average shares outstanding assuming dilution. Dilutive common shares outstanding is computed using the treasury stock method and reflects the additional shares that would be outstanding if dilutive warrants were exercised and restricted stock units and restricted stock awards were settled for common shares during the period. For warrants that are liability-classified, during the periods when the impact would be dilutive, the Company assumes share settlement of the instruments as of the beginning of the reporting period and adjusts the numerator to remove the change in the fair value of warrant liability and adjusts the denominator to include the dilutive shares using the treasury stock method. |
Derivatives Financial Instruments | Derivative Instruments —The Company’s earnings and cash flows are subject to fluctuations due to changes in interest rates. The Company uses derivative financial instruments, including interest rate swaps, to manage interest rate exposures and hedge the variability of interest payments on future debt obligations. The Company does not use derivative financial instruments for trading or speculative purposes. The Company formally documents all relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking hedge transactions. This process includes linking the derivatives designated as cash flow hedges to specific forecasted transactions or variability of cash flows. The Company also formally assesses, both at the inception of a hedge transaction and on an ongoing basis, whether the designated derivatives that are used in hedging transactions are highly effective in offsetting changes in the cash flow of the hedged items as well as monitors the credit worthiness of the counterparties to ensure no issues exist which would affect the value of the derivatives. When a derivative is determined not to be highly effective as a hedge or the underlying hedged transaction is no longer probable, the Company discontinues hedge accounting prospectively and reclassifies any hedge related gains or losses previously recorded in other comprehensive income (loss) to other (expense) income within the statement of operations. |
BASIS OF PRESENTATION AND SIG_3
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Disaggregation of Revenue | The following table presents the Company’s revenues disaggregated by product categories (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Sweeteners and adjacencies $ 426,287 $ 422,638 $ 389,174 Licorice products 124,626 115,634 104,799 Total product revenues, net $ 550,913 $ 538,272 $ 493,973 The following table presents revenues disaggregated by business and geographic region (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Branded CPG: North America $ 305,849 $ 299,871 $ 266,661 Europe 70,405 67,962 76,392 India, Middle East and Africa 13,854 17,828 13,363 Asia-Pacific 21,436 22,371 20,787 Latin America 14,743 14,606 11,971 Flavors & Ingredients 124,626 115,634 104,799 Total product revenues, net $ 550,913 $ 538,272 $ 493,973 |
Accounts Receivable, Allowance for Credit Loss | A summary of the activity with respect to the accounts receivable allowances is as follows (in thousands): Accounts receivable allowance balance at December 31, 2020 $ 955 2021 additions charged to revenues, costs and expenses 1,783 2021 deductions and other (1,453) Accounts receivable allowance balance at December 31, 2021 $ 1,285 2022 additions charged to revenues, costs and expenses 2,711 2022 deductions and other (2,382) Accounts receivable allowance balance at December 31, 2022 $ 1,614 2023 additions charged to revenues, costs and expenses 2,671 2023 deductions and other (2,825) Accounts receivable allowance balance at December 31, 2023 $ 1,460 |
BUSINESS COMBINATION (Tables)
BUSINESS COMBINATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Summary of Purchase Consideration | The following summarizes the purchase consideration (in thousands): Base cash consideration $ 180,000 Closing adjustment 13,863 Fair value of Earn-Out Amount 52,395 Total Purchase Price $ 246,258 |
Summary of Allocation of the Purchase Price to Tangible and Identifiable Intangible Assets Acquired and Liabilities Assumed | The Company recorded the fair value of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed as follows (in thousands): Cash and cash equivalents $ 2,664 Accounts receivable 15,868 Inventories 76,879 Prepaid expenses and other current assets 1,322 Property, plant and equipment, net 3,134 Operating lease right-of-use assets 7,585 Intangible assets 104,500 Other assets 1,189 Total assets acquired 213,141 Accounts payable 5,251 Accrued expenses and other current liabilities 10,576 Current portion of operating lease liabilities 1,435 Operating lease liabilities, less current portion 6,150 Deferred tax liabilities, net 24,234 Total liabilities assumed 47,646 Net assets acquired 165,495 Goodwill 80,763 Total Purchase Price $ 246,258 |
Summary of Values Allocated to Identifiable Intangible Assets and Their Estimated Useful Lives | The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Identifiable intangible assets Fair Value (in thousands) Useful Life (in years) Customer relationships $ 55,700 10 Tradenames 48,800 25 $ 104,500 |
Summary of Pro Forma Financial Information | The following unaudited pro forma financial information summarizes the results of operations for the Company as though the Business Combination and the acquisition of Swerve, L.L.C. (“Swerve LLC”), and Swerve IP, L.L.C. (“Swerve IP” and together with Swerve LLC, “Swerve”) on November 10, 2020 had occurred on January 1, 2019 and the Wholesome acquisition had occurred on January 1, 2020 (in thousands): Pro Forma Statements of Operations Year Ended December 31, 2021 Revenue $ 514,353 Net income $ 14,082 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Components of Lease Expense | The components of lease expense were as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Operating lease expense $ 9,221 $ 8,370 $ 5,658 Variable lease expense 1,645 1,634 1,022 Short-term lease expense 1,717 711 988 Sublease income (403) (326) (508) Total $ 12,180 $ 10,389 $ 7,160 |
Schedule of Future Maturities of the Company's Lease Obligations | The following table presents the future maturities of the Company’s lease obligations as of December 31, 2023 (in thousands): 2024 $ 8,215 2025 5,456 2026 3,192 2027 2,802 2028 2,380 Thereafter 2,778 Total lease payments 24,823 Less: imputed interest (3,117) Total operating lease liabilities $ 21,706 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | Inventories consisted of the following (in thousands): December 31, 2023 December 31, 2022 Raw materials and supplies $ 125,421 $ 129,131 Work in process 1,505 1,835 Finished goods 82,345 88,009 Total inventories $ 209,271 $ 218,975 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, plant and equipment consisted of the following (in thousands): December 31, 2023 December 31, 2022 Machinery, equipment and other $ 42,276 $ 39,695 Buildings and improvements 22,431 21,565 64,707 61,260 Accumulated depreciation (16,169) (11,410) 48,538 49,850 Land 5,930 5,951 Construction in progress 469 2,291 Property, plant and equipment, net $ 54,937 $ 58,092 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Components of Goodwill and Other Intangible Assets | Goodwill and other intangible assets consisted of the following (in thousands): December 31, 2023 December 31, 2022 Gross Accumulated Amortization Net Gross Accumulated Amortization Net Other intangible assets subject to amortization Customer relationships (useful life of 5 to 10 years) $ 105,616 $ (38,074) $ 67,542 $ 105,298 $ (26,137) $ 79,161 Tradenames (useful life of 25 years) 174,495 (22,801) 151,694 171,013 (15,498) 155,515 Total $ 280,111 $ (60,875) $ 219,236 $ 276,311 $ (41,635) $ 234,676 Other intangible assets not subject to amortization Product formulations 10,700 10,700 Total other intangible assets, net 229,936 245,376 Goodwill 193,610 193,139 Total goodwill and other intangible assets $ 423,546 $ 438,515 |
Schedule of Amortization Expense | Amortization expense relating to amortizable intangible assets as of December 31, 2023 for the next five years is expected to be as follows (in thousands): 2024 $ 18,704 2025 18,460 2026 18,229 2027 17,015 2028 15,024 |
Schedule of Changes in Carrying Amounts of Goodwill | The changes in the carrying amounts of goodwill during the years ended December 31, 2023 and December 31, 2022 were as follows (in thousands): Branded CPG Flavors & Ingredients Total Balance at December 31, 2021 $ 238,857 $ 3,804 $ 242,661 Currency translation adjustment (2,870) (152) (3,022) Gross balance at December 31, 2022 $ 235,987 $ 3,652 $ 239,639 Accumulated impairment loss at December 31, 2022 (46,500) — (46,500) Balance at December 31, 2022 $ 189,487 $ 3,652 $ 193,139 Impairment (7,230) — (7,230) Currency translation adjustment 7,695 6 7,701 Balance at December 31, 2023 $ 189,952 $ 3,658 $ 193,610 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Components of Debt | Debt consisted of the following (in thousands): December 31, 2023 December 31, 2022 Term loan, due 2028 $ 364,688 $ 368,438 Revolving credit facility, due 2026 64,000 76,000 Less: current portion (3,750) (3,750) Less: unamortized discount and debt issuance costs (7,009) (8,516) Total long-term debt $ 417,929 $ 432,172 |
Summary of Principal Maturities of Long-Term Debt | The Company’s debt and other obligations outstanding as of December 31, 2023 mature as shown below (in thousands): 2024 $ 3,750 2025 3,750 2026 67,750 2027 3,750 2028 349,688 Thereafter — Total debt 428,688 Unamortized discounts (7,009) Total debt, net of unamortized discounts $ 421,679 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Components of Income Tax (Benefit) Provision | Components of the income tax provision (benefit) were as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Current: Federal $ 1,912 $ (364) $ 916 State and local 725 419 283 Foreign 4,746 6,190 3,957 7,383 6,245 5,156 Deferred: Federal (1,082) (2,944) (6,498) State and local (70) (581) (2,801) Foreign 98 3,069 (3,001) (1,054) (456) (12,300) Total provision (benefit) for income taxes $ 6,329 $ 5,789 $ (7,144) |
Schedule of Effective Income Tax Rate Reconciliation | The following is a reconciliation of income tax provision (benefit) computed at the U.S. federal statutory rate to income tax provision (benefit) in the consolidated statements of operations (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 (Loss) income before income taxes: Domestic $ (43,041) $ (86,952) $ (36,205) Foreign 11,274 33,989 29,144 Total (loss) income before income taxes $ (31,767) $ (52,963) $ (7,061) Federal income tax rate 21.0% 21.0% 21.0% Federal income taxes $ (6,671) $ (11,122) $ (1,483) State and local taxes (1,449) (1,666) (3,572) Foreign rate differential (325) (545) (1,431) Change in tax rates (5) 295 225 Change in uncertain tax positions 9 6 (1,005) Change in valuation allowance 12,480 4,588 2,657 Goodwill impairment 1,531 9,765 — U.S. effects of international operations 3,263 5,603 3,041 Tax credits (3,667) (3,250) (2,763) Section 162(m) limitation 475 87 206 Transaction costs — 31 385 Stock-based compensation 929 422 502 Switzerland tax ruling — — (4,057) Foreign withholding taxes 128 1,043 350 Other (369) 532 (199) Total provision (benefit) for income taxes $ 6,329 $ 5,789 $ (7,144) Effective tax rate (19.9)% (10.9)% 101.2% |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s net deferred tax assets and liabilities were as follows (in thousands): December 31, 2023 December 31, 2022 Deferred tax assets: Accounts receivable $ 354 $ 441 Accrued expenses 5,442 4,938 Inventory 3,450 4,112 Deferred rent 24 — Other assets 1,690 1,184 Pension asset 2,466 2,320 Hedging 275 — Capitalized research and development expense 979 445 Lease accounting 5,695 5,458 U.S. and foreign net operating losses 19,568 19,150 Deferred interest expense 21,280 11,241 Tax credits 1,028 887 Total deferred tax assets 62,251 50,176 Less valuation allowance (27,747) (16,592) Net deferred tax assets $ 34,504 $ 33,584 Deferred tax liabilities: Property, plant and equipment (6,714) (6,270) Operating lease right-of-use asset (4,971) (4,621) Intangible assets (43,477) (45,964) Deferred rent — (63) Unremitted earnings (2,447) (2,295) Other liabilities (7,974) (6,417) Total deferred tax liabilities (65,583) (65,630) Net deferred tax liability $ (31,079) $ (32,046) |
PENSION AND OTHER RETIREMENTS_2
PENSION AND OTHER RETIREMENTS BENEFITS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
Funded Status of Company's Defined Benefit Pension Plans | The following table reconciles the funded status of the Company’s defined benefit pension plans Year Ended December 31, 2023 December 31, 2022 Accumulated benefit obligations $ 7,941 $ 7,706 Changes in projected benefit obligations: Projected benefit obligations at beginning of year $ 7,706 $ 20,314 Service cost — 41 Interest cost 377 326 Actuarial loss (gain) 208 (3,084) Benefits paid (350) (9,891) Projected benefit obligations at end of year 7,941 7,706 Change in plans’ assets: Fair value of plans’ assets at beginning of year 2,522 12,902 Actual returns on plans’ assets 10 (349) Employer contributions 350 360 Benefits paid (419) (9,891) Transfers related to plan termination (2,463) (500) Fair value of plans’ assets at end of year — 2,522 Net pension liability $ (7,941) $ (5,184) |
Schedule of Amounts Recognized in Balance Sheet | Amounts recognized in the Company’s consolidated balance sheets consisted of (in thousands): Year Ended December 31, 2023 December 31, 2022 Other assets $ — $ 2,522 Accrued expenses and other current liabilities (355) (355) Other liabilities (7,586) (7,351) Net amount recognized $ (7,941) $ (5,184) |
Schedule of Net Periodic Benefit Cost Not yet Recognized | Amounts recognized in accumulated other comprehensive income (loss), net of tax, which have not yet been recognized as a component of net periodic pension expense for the Company’s defined benefit pension plans, are as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Net actuarial gain $ (1,323) $ (1,523) $ (207) $ (1,323) $ (1,523) $ (207) |
Schedule of Amounts Recognized in Other Comprehensive Income (Loss) | The components of the changes in unrecognized amounts included in pension obligation, net in other comprehensive income (loss) for the Company’s defined benefit pension plans were as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Net actuarial loss (gain) $ 152 $ (1,316) $ 527 Amortization of actuarial gain (loss) 48 — (36) Total loss (gain) recognized in other comprehensive income (loss) $ 200 $ (1,316) $ 491 |
Components of Net Periodic Benefit (Credit) Expense | The components of net periodic benefit cost (credit) for the Company’s defined benefit pension plans were as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Service cost $ — $ 41 $ 63 Interest cost 377 326 1,047 Expected return on plan assets — 144 (1,310) Amortization of net actuarial (gain) loss (63) — 36 Settlement loss (income) 59 (1,178) (644) Net periodic benefit cost (credit) $ 373 $ (667) $ (808) Net periodic benefit cost (credit) is reflected in the Company’s consolidated financial statements as follows (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Selling, general and administrative expense $ — $ 41 $ 63 Other expense (income), net 373 (708) (871) Net periodic benefit cost (credit) $ 373 $ (667) $ (808) |
Schedule of Assumptions for Benefit Obligations | The following assumptions were used to determine the net periodic benefit cost during 2022 for the Company’s funded defined benefit pension plan: Year Ended December 31, 2022 Weighted-average assumptions used to determine net periodic benefit cost: Discount rate 2.38 % Expected long-term rate of return on plan assets 1.70 % The following assumptions were used to determine the benefit obligation at year end and net periodic benefit cost during the year for the Company’s unfunded supplemental defined benefit pension plan: Year Ended December 31, 2023 December 31, 2022 Weighted-average assumptions used to determine benefit obligation at year end: Discount rate 4.81 % 5.01 % Weighted-average assumptions used to determine net periodic benefit cost: Discount rate 5.01 % 2.78 % Rate of compensation increase — % 3.50 % |
Schedule of Target Allocation and Fair Value of Plan Assets | The following tables set forth, by category, the Company’s pension plan assets as of December 31, 2022, using the fair value hierarchy established under ASC Topic 820 and as described in Note 9 (in thousands): Pension Plan Assets as of December 31, 2022 Level 1 Level 2 Level 3 Total Pension plan assets measured at fair value: Cash and cash equivalents $ 2,522 $ — $ — $ 2,522 Total pension plan assets measured at fair value $ 2,522 $ — $ — $ 2,522 |
Schedule of Projected Benefit Payments | The projected benefit payments for the unfunded non-qualified 2024 $ 355 2025 425 2026 592 2027 588 2028 583 2029-2033 3,177 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Activity Related to RSUs and RSAs | A summary of activity and weighted average fair values related to the RSUs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2022 1,538,759 $ 6.65 0.71 Granted 3,023,061 2.55 Vested (1,224,235) 6.25 Forfeited (1,220,914) 2.97 Outstanding and nonvested at December 31, 2023 2,116,671 $ 3.19 1.12 A summary of activity and weighted average fair values related to the RSAs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2022 131,470 $ 8.75 1.19 Granted 141,280 4.07 Vested (58,194) 11.00 Outstanding and nonvested at December 31, 2023 214,556 $ 5.06 1.16 The weighted average grant date fair value per share of RSAs granted during the year was $4.07 in 2023, $6.96 in 2022, and $11.77 in 2021. The aggregate fair value of RSAs upon vesting during the years ended December 31, 2023 and 2022 was $0.2 million and $0.5 million, respectively. No RSAs vested during the year ended December 31, 2021. A summary of activity and weighted average fair values related to the PSUs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2022 631,377 $ 8.49 1.88 Granted 1,934,388 2.20 Forfeited (1,035,405) 3.06 Outstanding and nonvested at December 31, 2023 1,530,360 $ 4.21 1.81 |
Schedule of Unrecognized Compensation Cost on Nonvested Awards | As of December 31, 2023, the Company had not yet recognized compensation cost on nonvested awards as follows (in thousands): Unrecognized Weighted Avg. Nonvested awards $ 7,243 1.39 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted (Loss) Earnings Per Common Share | The computation of basic and diluted EPS for the years ended December 31, 2023, 2022 and 2021 is shown below (in thousands, except for share and per share data): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 EPS numerator: Net (loss) income attributable to common shareholders $ (38,096) $ (58,752) $ 83 Less: Change in fair value of warrant liabilities — — (29) Numerator - diluted $ (38,096) $ (58,752) $ 54 EPS denominator: Weighted average shares outstanding - basic 42,483,083 41,481,079 38,505,458 Effect of dilutive securities — — 1,370,929 Weighted average shares outstanding - diluted 42,483,083 41,481,079 39,876,387 Net earnings (loss) per share: Basic $ (0.90) $ (1.42) $ 0.00 Diluted $ (0.90) $ (1.42) $ 0.00 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
AOCI Attributable to Parent [Abstract] | |
Summary of Change in the Components of Accumulated Other Comprehensive Loss, Net of Tax | The following table summarizes accumulated other comprehensive income (loss) (“AOCI”), net of taxes, by component (in thousands): Net Currency Cash Flow Hedges Funded Status of Benefit Plans Total Balance at December 31, 2021 $ 8,758 $ — $ 929 $ 9,687 Other comprehensive (loss) income before reclassifications (13,469) — 2,926 (10,543) Amounts reclassified from AOCI — — (186) (186) Balance at December 31, 2022 $ (4,711) $ — $ 3,669 $ (1,042) Other comprehensive income (loss), before reclassifications 11,787 (28) (544) 11,215 Amounts reclassified from AOCI — (720) (204) (924) Balance at December 31, 2023 $ 7,076 $ (748) $ 2,921 $ 9,249 |
BUSINESS SEGMENTS (Tables)
BUSINESS SEGMENTS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Selected Financial Information Relating to the Business' Reportable Segments | The following table presents selected financial information relating to the Company’s business segments (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 Product revenues, net Branded CPG $ 426,287 $ 422,638 $ 389,174 Flavors & Ingredients 124,626 115,634 104,799 Total product revenues, net $ 550,913 $ 538,272 $ 493,973 Operating income (loss) Branded CPG $ 8,167 $ (30,182) $ 34,918 Flavors & Ingredients 35,681 32,505 21,860 43,848 2,323 56,778 Corporate (28,453) (26,969) (33,962) Total operating income (loss) $ 15,395 $ (24,646) $ 22,816 |
Summary of Revenues Disaggregated by Geographic Operating Segments | The following table presents geographic information based upon revenues of the Company’s major geographic markets (in thousands): Year Ended December 31, 2023 December 31, 2022 December 31, 2021 North America $ 366,207 $ 357,175 $ 318,958 Europe 95,095 92,272 96,013 India, Middle East and Africa 16,201 19,940 14,801 Asia-Pacific 57,731 53,300 51,598 Latin America 15,679 15,585 12,603 Total product revenues, net $ 550,913 $ 538,272 $ 493,973 |
Summary of Long-Lived Assets Disaggregated by Geographic Operating Segments | Long-lived assets are as follows (in thousands): December 31, 2023 December 31, 2022 Long-Lived Assets* United States $ 20,990 $ 24,516 China 14,421 14,805 Czech Republic 6,355 6,451 France 12,079 10,960 Other Foreign Countries 1,092 1,360 Total $ 54,937 $ 58,092 |
BASIS OF PRESENTATION AND SIG_4
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Jun. 25, 2020 | Mar. 31, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Private placement warrants issued (in shares) | 5,263,500 | ||||
Shares called upon by private placement warrants (in shares) | 2,631,750 | 0 | |||
Deferred software costs | $ 2,100,000 | ||||
Amortization of deferred software costs | 800,000 | $ 0 | $ 0 | ||
Research and development expenses | 3,800,000 | 3,900,000 | 3,400,000 | ||
Advertising expense | 12,000,000 | 11,800,000 | 17,000,000 | ||
Total foreign exchange gains (losses), tax | (3,300,000) | 100,000 | (200,000) | ||
Expense related to remeasurement adjustments | 1,800,000 | 1,200,000 | 300,000 | ||
Restructuring and other non-recurring expenses | 0 | 0 | 4,503,000 | ||
Change in fair value of warrant liabilities | $ (78,000) | (1,232,000) | (29,000) | ||
Private Placement | Level 3 | Warrants and Rights Outstanding | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Warrant liabilities | 8,100,000 | ||||
Minimum | Buildings | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Property, plant and equipment, useful life | 3 years | ||||
Minimum | Property, Plant and Equipment, Other Types | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Property, plant and equipment, useful life | 1 year | ||||
Maximum | Buildings | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Property, plant and equipment, useful life | 40 years | ||||
Maximum | Property, Plant and Equipment, Other Types | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Property, plant and equipment, useful life | 20 years | ||||
Facility Closing | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Restructuring and other non-recurring expenses | 3,900,000 | ||||
Employee Severance | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Restructuring and other non-recurring expenses | $ 600,000 | ||||
Accrued severance expense | $ 0 | $ 0 | |||
Common Stock | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Conversion basis for conversion of the then-issued and outstanding ordinary shares of predecessor into successor shares (in shares) | 1 | ||||
Shares issued (in shares) | 7,500,000 | ||||
Restatement adjustment | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Change in fair value of warrant liabilities | $ 1,200,000 | ||||
Restatement adjustment | Merisant and Mafco Worldwide | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Transaction costs | $ 1,100,000 |
BASIS OF PRESENTATION AND SIG_5
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Accounts Receivable Allowances (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Accounting Policies [Abstract] | ||||
Accounts receivable, allowance balance | $ 1,460 | $ 1,614 | $ 1,285 | $ 955 |
Additions charged to revenues, costs, and expenses | 2,671 | 2,711 | 1,783 | |
Deductions and other | $ (2,825) | $ (2,382) | $ (1,453) |
BASIS OF PRESENTATION AND SIG_6
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | $ 550,913 | $ 538,272 | $ 493,973 |
Flavors & Ingredients | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 124,626 | 115,634 | 104,799 |
North America | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 366,207 | 357,175 | 318,958 |
North America | Branded CPG | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 305,849 | 299,871 | 266,661 |
Europe | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 95,095 | 92,272 | 96,013 |
Europe | Branded CPG | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 70,405 | 67,962 | 76,392 |
India, Middle East and Africa | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 16,201 | 19,940 | 14,801 |
India, Middle East and Africa | Branded CPG | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 13,854 | 17,828 | 13,363 |
Asia-Pacific | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 57,731 | 53,300 | 51,598 |
Asia-Pacific | Branded CPG | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 21,436 | 22,371 | 20,787 |
Latin America | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 15,679 | 15,585 | 12,603 |
Latin America | Branded CPG | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 14,743 | 14,606 | 11,971 |
Sweeteners and adjacencies | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | 426,287 | 422,638 | 389,174 |
Licorice products | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Product revenues, net | $ 124,626 | $ 115,634 | $ 104,799 |
BUSINESS COMBINATION - Purchase
BUSINESS COMBINATION - Purchase Consideration (Details) - USD ($) $ in Thousands | 11 Months Ended | 12 Months Ended | |||
Feb. 05, 2021 | Dec. 31, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | |||||
Payments to Acquire Businesses, Gross | $ 0 | $ 0 | $ 190,231 | ||
Wholesome | |||||
Business Acquisition [Line Items] | |||||
Payments to Acquire Businesses, Gross | $ 180,000 | ||||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustment, Consideration Transferred | 13,863 | $ 3,600 | |||
Fair value of Earn-Out Amount | 52,395 | ||||
Business Combination, Consideration Transferred, Total | $ 246,258 |
BUSINESS COMBINATION - Allocati
BUSINESS COMBINATION - Allocation of the Purchase Price to Tangible and Identifiable Intangible Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Feb. 05, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 193,610 | $ 193,139 | $ 242,661 | |
Wholesome | ||||
Business Acquisition [Line Items] | ||||
Cash and cash equivalents | $ 2,664 | |||
Accounts receivable | 15,868 | |||
Inventories | 76,879 | |||
Prepaid expenses and other current assets | 1,322 | |||
Property, plant and equipment, net | 3,134 | |||
Operating lease right-of-use assets | 7,585 | |||
Intangible assets | 104,500 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets | 1,189 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets, Total | 213,141 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable | 5,251 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accrued Liabilities And Other Current Liabilities | 10,576 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Operating Lease Liabilities | 1,435 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Operating Lease Liabilities Net Of Current Portion | 6,150 | |||
Deferred tax liabilities, net | 24,234 | |||
Total liabilities assumed | 47,646 | |||
Net assets acquired | 165,495 | |||
Goodwill | 80,763 | |||
Business Combination, Consideration Transferred, Total | $ 246,258 |
BUSINESS COMBINATION - Values A
BUSINESS COMBINATION - Values Allocated to Identifiable Intangible Assets and Their Estimated Useful Lives (Details) - Wholesome $ in Thousands | Feb. 05, 2021 USD ($) |
Business Acquisition [Line Items] | |
Intangible assets | $ 104,500 |
Customer relationships | |
Business Acquisition [Line Items] | |
Intangible assets | $ 55,700 |
Useful life (in Years) | 10 years |
Tradenames | |
Business Acquisition [Line Items] | |
Intangible assets | $ 48,800 |
Useful life (in Years) | 25 years |
BUSINESS COMBINATION - Narrativ
BUSINESS COMBINATION - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 11 Months Ended | 12 Months Ended | |||||
Feb. 23, 2022 | Feb. 05, 2021 | Mar. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | |
Business Acquisition [Line Items] | ||||||||
Payments to Acquire Businesses, Gross | $ 0 | $ 0 | $ 190,231 | |||||
Payments of contingent consideration | $ 0 | 29,108 | 0 | |||||
Merisant and Mafco Worldwide | Restatement adjustment | ||||||||
Business Acquisition [Line Items] | ||||||||
Transaction costs | $ 1,100 | |||||||
Wholesome | ||||||||
Business Acquisition [Line Items] | ||||||||
Goodwill deductible for income tax purposes | $ 4,700 | |||||||
Goodwill deductible for income tax purposes, period (in years) | 9 years | |||||||
Closing adjustment period | 1 year | |||||||
Increase (decrease) in deferred tax liabilities | $ (2,800) | |||||||
Increase (decrease) in goodwill | 1,000 | |||||||
Transaction costs | 4,700 | $ 200 | 4,700 | |||||
Payments to Acquire Businesses, Gross | $ 180,000 | |||||||
Fair value of Earn-Out Amount | 52,395 | |||||||
Business Combination, Contingent Consideration, Liability, Current | 55,000 | |||||||
EBITDA Threshold | 30,000 | |||||||
Earn-out amounts payable in common stock | $ 27,500 | |||||||
Weighted average trading price period | 20 days | |||||||
Shares issued (in shares) | 2,659,574 | |||||||
Payments of contingent consideration | $ 30,000 | |||||||
Gain on settlement of contingent consideration liability | $ 1,100 | |||||||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustment, Consideration Transferred | $ 13,863 | 3,600 | ||||||
Increase (decrease) in inventory | (1,800) | |||||||
Increase (decrease) in prepaid expenses and other current assets | 500 | |||||||
Increase (decrease) in property, plant and equipment | 400 | |||||||
Increase (decrease) in intangible assets | (1,900) | |||||||
Increase (decrease) in other assets | (100) | |||||||
Increase (decrease) in accrued expenses and other current liabilities | $ (2,700) | |||||||
Product revenue, net | 179,600 | |||||||
Operating income | $ 20,600 |
BUSINESS COMBINATION - Pro Form
BUSINESS COMBINATION - Pro Forma Financial Information (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2021 USD ($) | |
Business Combination and Asset Acquisition [Abstract] | |
Revenue | $ 514,353 |
Net loss | $ 14,082 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Feb. 05, 2021 | |
Lessee, Lease, Description [Line Items] | ||||
Weighted-average remaining lease term (in years) | 4 years 2 months 12 days | 3 years | ||
Weighted-average discount rate (as a percent) | 5.99% | 4.19% | ||
Operating lease payments | $ 10,200 | $ 8,900 | $ 5,700 | |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | $ 10,200 | $ 700 | $ 12,900 | |
Wholesome | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease right-of-use assets | $ 7,585 | |||
Minimum | ||||
Lessee, Lease, Description [Line Items] | ||||
Extended lease term (in years) | 1 year | |||
Maximum | ||||
Lessee, Lease, Description [Line Items] | ||||
Extended lease term (in years) | 5 years |
LEASES - Components of Lease Ex
LEASES - Components of Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | |||
Operating lease expense | $ 9,221 | $ 8,370 | $ 5,658 |
Variable lease expense | 1,645 | 1,634 | 1,022 |
Short-term lease expense | 1,717 | 711 | 988 |
Sublease income | (403) | (326) | (508) |
Total | $ 12,180 | $ 10,389 | $ 7,160 |
LEASES - Future Maturities of t
LEASES - Future Maturities of the Company's Lease Obligations (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Leases [Abstract] | |
2024 | $ 8,215 |
2025 | 5,456 |
2026 | 3,192 |
2027 | 2,802 |
2028 | 2,380 |
Thereafter | 2,778 |
Total lease payments | 24,823 |
Less: imputed interest | (3,117) |
Total operating lease liabilities | $ 21,706 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials and supplies | $ 125,421 | $ 129,131 |
Work in process | 1,505 | 1,835 |
Finished goods | 82,345 | 88,009 |
Total inventories | $ 209,271 | $ 218,975 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Accumulated depreciation | $ (16,169) | $ (11,410) |
Property, Plant and Equipment, net | 54,937 | 58,092 |
Depreciable property, plant and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 64,707 | 61,260 |
Property, Plant and Equipment, net | 48,538 | 49,850 |
Machinery, equipment and other | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 42,276 | 39,695 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 22,431 | 21,565 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 5,930 | 5,951 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 469 | $ 2,291 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Components of Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Other intangible assets subject to amortization | |||
Other intangible assets subject to amortization, Gross | $ 280,111 | $ 276,311 | |
Other intangible assets subject to amortization, Accumulated Amortization | (60,875) | (41,635) | |
Other intangible assets subject to amortization, Net | 219,236 | 234,676 | |
Other intangible assets not subject to amortization | |||
Total other intangible assets, net | 229,936 | 245,376 | |
Goodwill | 193,610 | 193,139 | $ 242,661 |
Total goodwill and other intangible assets | 423,546 | 438,515 | |
Product Formulations [Member] | |||
Other intangible assets not subject to amortization | |||
Other intangible assets not subject to amortization, Net | 10,700 | 10,700 | |
Customer relationships | |||
Other intangible assets subject to amortization | |||
Other intangible assets subject to amortization, Gross | 105,616 | 105,298 | |
Other intangible assets subject to amortization, Accumulated Amortization | (38,074) | (26,137) | |
Other intangible assets subject to amortization, Net | $ 67,542 | 79,161 | |
Customer relationships | Minimum | |||
Other intangible assets not subject to amortization | |||
Other intangible assets subject to amortization, useful life (in years) | 5 years | ||
Customer relationships | Maximum | |||
Other intangible assets not subject to amortization | |||
Other intangible assets subject to amortization, useful life (in years) | 10 years | ||
Tradenames | |||
Other intangible assets subject to amortization | |||
Other intangible assets subject to amortization, Gross | $ 174,495 | 171,013 | |
Other intangible assets subject to amortization, Accumulated Amortization | (22,801) | (15,498) | |
Other intangible assets subject to amortization, Net | $ 151,694 | $ 155,515 | |
Other intangible assets not subject to amortization | |||
Other intangible assets subject to amortization, useful life (in years) | 25 years |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill [Line Items] | ||||
Amortization of intangible assets | $ 18,698 | $ 18,623 | $ 18,295 | |
Goodwill impairment charge | $ 46,500 | 7,230 | 46,500 | |
Goodwill | 193,139 | $ 193,610 | 193,139 | $ 242,661 |
Weighted Average | ||||
Goodwill [Line Items] | ||||
Other intangible assets subject to amortization, useful life (in years) | 17 years | |||
Customer relationships | Weighted Average | ||||
Goodwill [Line Items] | ||||
Other intangible assets subject to amortization, useful life (in years) | 6 years 3 months 18 days | |||
Tradenames | ||||
Goodwill [Line Items] | ||||
Other intangible assets subject to amortization, useful life (in years) | 25 years | |||
Tradenames | Weighted Average | ||||
Goodwill [Line Items] | ||||
Other intangible assets subject to amortization, useful life (in years) | 21 years 9 months 18 days | |||
North America | ||||
Goodwill [Line Items] | ||||
Goodwill impairment charge | 42,500 | |||
Goodwill | 80,500 | 80,500 | ||
LATAM | ||||
Goodwill [Line Items] | ||||
Goodwill impairment charge | 4,000 | |||
Goodwill | $ 0 | $ 0 | ||
IMEA | ||||
Goodwill [Line Items] | ||||
Goodwill impairment charge | $ 7,200 | |||
Goodwill | $ 0 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Amortization Expense (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2024 | $ 18,704 |
2025 | 18,460 |
2026 | 18,229 |
2027 | 17,015 |
2028 | $ 15,024 |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLE ASSETS - Changes in Carrying Amounts of Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Goodwill [Roll Forward] | |||
Beginning balance | $ 193,139 | $ 242,661 | |
Currency translation adjustment | 7,701 | (3,022) | |
Goodwill, gross | $ 239,639 | 239,639 | |
Impairment | (46,500) | (7,230) | (46,500) |
Ending balance | 193,139 | 193,610 | 193,139 |
IMEA | |||
Goodwill [Roll Forward] | |||
Impairment | (7,200) | ||
Ending balance | 0 | ||
Branded CPG | |||
Goodwill [Roll Forward] | |||
Beginning balance | 189,487 | 238,857 | |
Currency translation adjustment | 7,695 | (2,870) | |
Goodwill, gross | 235,987 | 235,987 | |
Impairment | (7,230) | (46,500) | |
Ending balance | 189,487 | 189,952 | 189,487 |
Flavors & Ingredients | |||
Goodwill [Roll Forward] | |||
Beginning balance | 3,652 | 3,804 | |
Currency translation adjustment | 6 | (152) | |
Goodwill, gross | 3,652 | 3,652 | |
Impairment | 0 | 0 | |
Ending balance | $ 3,652 | $ 3,658 | $ 3,652 |
DEBT - Components of Debt (Deta
DEBT - Components of Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 428,688 | |
Less: current portion | (3,750) | $ (3,750) |
Less: unamortized discount and debt issuance costs | (7,009) | (8,516) |
Long-term debt | 417,929 | 432,172 |
Secured Debt | Senior Secured First Lien Term Loan Facility | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 364,688 | 368,438 |
Revolving Credit Facility | First Lien Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 64,000 | $ 76,000 |
DEBT - Principal Maturities of
DEBT - Principal Maturities of Long-Term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
2024 | $ 3,750 | |
2025 | 3,750 | |
2026 | 67,750 | |
2027 | 3,750 | |
2028 | 349,688 | |
Thereafter | 0 | |
Total debt | 428,688 | |
Unamortized discounts | (7,009) | $ (8,516) |
Total debt, net of unamortized discounts | $ 421,679 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Jun. 15, 2022 USD ($) | Feb. 05, 2021 USD ($) | Feb. 04, 2021 USD ($) | Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Apr. 01, 2024 | |
Debt Instrument [Line Items] | ||||||||||
Long-term debt, carrying value | $ 421,679,000 | $ 421,679,000 | ||||||||
Gain (loss) on extinguishment of debt | 0 | $ 0 | $ (5,513,000) | |||||||
Credit Facilities | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt issuance costs | $ 7,800,000 | $ 6,200,000 | ||||||||
Gain (loss) on extinguishment of debt | (1,100,000) | $ (4,400,000) | ||||||||
Payments of fees to lenders | 3,800,000 | |||||||||
Transaction costs | $ 8,900,000 | |||||||||
Credit Facilities | Debt Redemption, Term 1 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, redemption price (as a percent) | 100% | |||||||||
Dispositions of property, minimum amount | $ 5,000,000 | |||||||||
Credit Facilities | Debt Redemption, Term 2 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, redemption price (as a percent) | 100% | |||||||||
Credit Facilities | Debt Redemption, Term 3 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Excess Cash Flow (as a percent) | 50% | |||||||||
Credit Facilities | Debt Redemption, Term 3 | Debt Instrument, Agreement Requirements, Requirement One | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Excess Cash Flow upon satisfaction of agreement requirements (as a percent) | 25% | |||||||||
Maximum net leverage ratio | 3.50 | |||||||||
Minimum net leverage ratio | 3 | |||||||||
Quarterly amortization payments (as a percent) | 0.25% | |||||||||
Credit Facilities | Debt Redemption, Term 3 | Debt Instrument, Agreement Requirements, Requirement Two | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Excess Cash Flow upon satisfaction of agreement requirements (as a percent) | 0% | |||||||||
Maximum net leverage ratio | 3 | |||||||||
Amended Revolving Credit Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Payments of fees to lenders | $ 700,000 | |||||||||
Revolving Credit Facility | First Lien Revolving Credit Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Outstanding letter of credit | 3,300,000 | 3,300,000 | 2,100,000 | |||||||
Borrowings | 64,000,000 | 64,000,000 | 76,000,000 | |||||||
Revolving Credit Facility | Amended Revolving Credit Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 125,000,000 | $ 75,000,000 | ||||||||
Secured Debt | Senior Secured First Lien Term Loan Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Long-term debt, carrying value | 357,700,000 | 357,700,000 | 359,900,000 | |||||||
Debt issuance costs | 7,000,000 | 7,000,000 | 8,500,000 | |||||||
Secured Debt | Term Loan Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Face amount | 375,000,000 | 375,000,000 | ||||||||
Revolving Credit Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Issuance costs capitalized | $ 1,700,000 | $ 1,700,000 | $ 2,000,000 | |||||||
Base Rate | Revolving Credit Facility | Amended Revolving Credit Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 2.75% | |||||||||
Base Rate | Secured Debt | Senior Secured First Lien Term Loan Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 3.50% | |||||||||
Fed Funds Effective Rate Overnight Index Swap Rate | Credit Facilities | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 0.50% | |||||||||
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Credit Facilities | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 1% | |||||||||
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Revolving Credit Facility | Amended Revolving Credit Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 3.75% | |||||||||
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Secured Debt | Senior Secured First Lien Term Loan Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 4.50% | |||||||||
One Month SOFR | Credit Facilities | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 0.10% | |||||||||
Three Month SOFR | Credit Facilities | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 0.15% | |||||||||
Six Month SOFR | Credit Facilities | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 0.25% | |||||||||
Total Leverage Ratio | Revolving Credit Facility | Second Amendment | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Increase (Decrease) in Total Leverage Ratio | 0.0025 | 0.005 | ||||||||
Total Leverage Ratio | Revolving Credit Facility | Second Amendment | Subsequent Event | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Increase (Decrease) in Total Leverage Ratio | 0.0025 | |||||||||
Debt Instrument, Covenant, Leverage Ratio, Maximum | 0.055 |
WARRANTS (Details)
WARRANTS (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Jun. 25, 2020 | |
Class of Warrant or Right [Line Items] | |||
Warrants outstanding (in shares) | 20,263,500 | ||
Exercise price of warrants or rights (in dollars per share) | $ 11.50 | ||
Expiration of warrants (in years) | 5 years | ||
Warrants exercised (in shares) | 0 | 0 | |
Shares called upon exercise of warrants (in shares) | 0 | 2,631,750 | |
Common Class A | |||
Class of Warrant or Right [Line Items] | |||
Number of securities called by each warrant or right (in shares) | 0.50 | ||
Public Warrants | |||
Class of Warrant or Right [Line Items] | |||
Warrants outstanding (in shares) | 20,193,120 | 19,491,320 | 15,000,000 |
Redemption price (in dollars per share) | $ 0.01 | ||
Minimum prior written notice of redemption period | 30 days | ||
Trading days within trading day period | 20 days | ||
Trading day period | 30 days | ||
Last sale price of ordinary shares (in dollars per share) | $ 18 | ||
Private Placement | |||
Class of Warrant or Right [Line Items] | |||
Warrants outstanding (in shares) | 70,180 | 771,980 | 5,263,500 |
Period after closing of transaction | 30 days |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Jun. 09, 2023 | Dec. 31, 2022 | |
Class of Warrant or Right [Line Items] | |||
Long-term debt, carrying value | $ 421,679 | ||
Other Comprehensive Income (Loss), Realized Gains (Losses) Recognized in Interest Expense | 700 | ||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 800 | ||
Interest Rate Swap | |||
Class of Warrant or Right [Line Items] | |||
Derivative, Fair Value, Net | (1,000) | ||
Derivative, Notional Amount | $ 183,300 | ||
Investment Fund | |||
Class of Warrant or Right [Line Items] | |||
Debt Securities, Available-for-Sale | 2,200 | $ 100 | |
Debt Securities, Available-for-Sale, Cost Basis | 2,200 | 100 | |
Secured Debt | Senior Secured First Lien Term Loan Facility | |||
Class of Warrant or Right [Line Items] | |||
Long-term debt, fair value | 317,300 | 338,000 | |
Long-term debt, carrying value | $ 357,700 | $ 359,900 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | Dec. 31, 2023 USD ($) |
Raw Materials | |
Long-term Purchase Commitment [Line Items] | |
Obligations to purchase raw material in 2023 | $ 80.5 |
Obligations to purchase raw material in 2024 | 3.8 |
Market Data Research, Technology Services and Capital Projects | |
Long-term Purchase Commitment [Line Items] | |
Obligations to market data research and technology | 3.7 |
Obligations to market data research and technology, current | 2.5 |
Obligations to market data research and technology, noncurrent | $ 1.2 |
INCOME TAXES - Components of In
INCOME TAXES - Components of Income Tax (Benefit) Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Current: | |||
Federal | $ 1,912 | $ (364) | $ 916 |
State and local | 725 | 419 | 283 |
Foreign | 4,746 | 6,190 | 3,957 |
Total current expense (benefit) | 7,383 | 6,245 | 5,156 |
Deferred: | |||
Federal | (1,082) | (2,944) | (6,498) |
State and local | (70) | (581) | (2,801) |
Foreign | 98 | 3,069 | (3,001) |
Total deferred (benefit) expense | (1,054) | (456) | (12,300) |
Total provision (benefit) for income taxes | $ 6,329 | $ 5,789 | $ (7,144) |
INCOME TAXES - Effective Income
INCOME TAXES - Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
(Loss) income before income taxes: | |||
Domestic | $ (43,041) | $ (86,952) | $ (36,205) |
Foreign | 11,274 | 33,989 | 29,144 |
Loss before income taxes | $ (31,767) | $ (52,963) | $ (7,061) |
Federal income tax rate (as a percent) | 21% | 21% | 21% |
Federal income taxes | $ (6,671) | $ (11,122) | $ (1,483) |
State and local taxes | (1,449) | (1,666) | (3,572) |
Foreign rate differential | (325) | (545) | (1,431) |
Change in tax rates | (5) | 295 | 225 |
Change in uncertain tax positions | 9 | 6 | (1,005) |
Change in valuation allowance | 12,480 | 4,588 | 2,657 |
Goodwill impairment | 1,531 | 9,765 | 0 |
U.S. effects of international operations | 3,263 | 5,603 | 3,041 |
Tax credits | (3,667) | (3,250) | (2,763) |
Section 162(m) limitation | 475 | 87 | 206 |
Transaction costs | 0 | 31 | 385 |
Stock-based compensation | 929 | 422 | 502 |
Switzerland tax ruling | 0 | 0 | (4,057) |
Foreign withholding taxes | 128 | 1,043 | 350 |
Other | (369) | 532 | (199) |
Total provision (benefit) for income taxes | $ 6,329 | $ 5,789 | $ (7,144) |
Effective tax rate (as a percent) | (19.90%) | (10.90%) | 101.20% |
INCOME TAXES - Deferred Tax Ass
INCOME TAXES - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets: | ||
Accounts receivable | $ 354 | $ 441 |
Accrued expenses | 5,442 | 4,938 |
Inventory | 3,450 | 4,112 |
Deferred rent | 24 | 0 |
Other assets | 1,690 | 1,184 |
Pension asset | 2,466 | 2,320 |
Hedging | 275 | 0 |
Capitalized research and development expense | 979 | 445 |
Lease accounting | 5,695 | 5,458 |
U.S. and foreign net operating losses | 19,568 | 19,150 |
Deferred interest expense | 21,280 | 11,241 |
Tax credits | 1,028 | 887 |
Total deferred tax assets | 62,251 | 50,176 |
Less valuation allowance | (27,747) | (16,592) |
Net deferred tax assets | 34,504 | 33,584 |
Deferred tax liabilities: | ||
Property, plant and equipment | (6,714) | (6,270) |
Operating lease right-of-use asset | (4,971) | (4,621) |
Intangible assets | (43,477) | (45,964) |
Deferred rent | 0 | (63) |
Unremitted earnings | (2,447) | (2,295) |
Other liabilities | (7,974) | (6,417) |
Total deferred tax liabilities | (65,583) | (65,630) |
Net deferred tax liability | $ (31,079) | $ (32,046) |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Examination [Line Items] | |||
Interest deductions | $ 12,800 | ||
Foreign tax credits | 1,000 | ||
State net operating loss carry forwards | 10,400 | ||
Foreign net operating loss carry forwards | 3,500 | ||
Increase in valuation allowance | 11,200 | ||
Change in valuation allowance | 12,480 | $ 4,588 | $ 2,657 |
Switzerland tax ruling | 0 | 0 | (4,057) |
Accrued income taxes | 2,400 | 2,300 | |
Revenue | 550,913 | 538,272 | $ 493,973 |
Uncertain tax position liability | 100 | 100 | |
Non-US | |||
Income Tax Examination [Line Items] | |||
Revenue | 57,100 | $ 56,100 | |
State and Local Jurisdiction | |||
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | 123,700 | ||
Domestic Tax Authority | |||
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | 1,000 | ||
Federal, IRC | |||
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | 86,800 | ||
Mexican Tax Authority | |||
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | 1,200 | ||
Luxembourg Inland Revenue | |||
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | 9,800 | ||
Ministry of Finance, India | |||
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | 1,100 | ||
State Administration of Taxation, China | |||
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | 400 | ||
ARGENTINA | |||
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | $ 1,600 |
PENSION AND OTHER RETIREMENTS_3
PENSION AND OTHER RETIREMENTS BENEFITS - Narrative (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Feb. 11, 2022 USD ($) | Mar. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) participant | Dec. 31, 2020 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Defined Benefit Plan Disclosure | |||||||
Number of participants receiving settlement | participant | 125 | ||||||
Lump sum payments | $ 9,300 | $ 16,800 | |||||
Pre-tax settlement gain | $ 1,200 | 500 | |||||
Pension benefit obligation | 7,706 | $ 7,941 | $ 7,706 | $ 20,314 | |||
Net pension asset (liability) | (5,184) | (7,941) | (5,184) | ||||
Total pension plan assets measured at fair value | $ 2,500 | 2,522 | 0 | 2,522 | 12,902 | ||
Net periodic benefit cost | $ (808) | 373 | (667) | (808) | |||
Defined contribution plan, cost | 1,200 | 1,200 | 1,000 | ||||
Nonqualified Plan | |||||||
Defined Benefit Plan Disclosure | |||||||
Pension benefit obligation | 7,700 | 7,900 | 7,700 | ||||
Foreign Plan | |||||||
Defined Benefit Plan Disclosure | |||||||
Pension benefit obligation | 5,500 | 5,300 | 5,500 | ||||
Net pension asset (liability) | (1,900) | (2,600) | (1,900) | ||||
Total pension plan assets measured at fair value | $ 3,600 | 2,700 | 3,600 | ||||
Net periodic benefit cost | $ 100 | $ 400 | $ 400 |
PENSION AND OTHER RETIREMENTS_4
PENSION AND OTHER RETIREMENTS BENEFITS - Funded Status of Company's Defined Benefit Pension Plans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |||
Accumulated benefit obligations | $ 7,941 | $ 7,706 | |
Changes in projected benefit obligations: | |||
Projected benefit obligations at beginning of year | 7,706 | 20,314 | |
Service cost | 0 | 41 | $ 63 |
Interest cost | 377 | 326 | 1,047 |
Actuarial loss (gain) | 208 | (3,084) | |
Benefits paid | (350) | (9,891) | |
Projected benefit obligations at end of year | 7,941 | 7,706 | 20,314 |
Change in plans’ assets: | |||
Fair value of plans’ assets at beginning of year | 2,522 | 12,902 | |
Actual returns on plans’ assets | 10 | (349) | |
Employer contributions | 350 | 360 | |
Benefits paid | (419) | (9,891) | |
Transfers related to plan termination | (2,463) | (500) | |
Fair value of plans’ assets at end of year | 0 | 2,522 | $ 12,902 |
Net pension liability | $ (7,941) | $ (5,184) | |
Defined Benefit Plan, Type [Extensible List] | Pension Plan [Member] |
PENSION AND OTHER RETIREMENTS_5
PENSION AND OTHER RETIREMENTS BENEFITS - Schedule of Amounts Recognized in Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Retirement Benefits [Abstract] | ||
Other assets | $ 0 | $ 2,522 |
Accrued expenses and other current liabilities | (355) | (355) |
Other liabilities | (7,586) | (7,351) |
Net amount recognized | $ (7,941) | $ (5,184) |
PENSION AND OTHER RETIREMENTS_6
PENSION AND OTHER RETIREMENTS BENEFITS - Net Periodic Cost Not yet Recognized (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |||
Net actuarial gain | $ (1,323) | $ (1,523) | $ (207) |
Net amount recorded in AOCI | (1,323) | (1,523) | (207) |
Net actuarial loss (gain) | 152 | (1,316) | 527 |
Amortization of actuarial gain (loss) | 48 | 0 | (36) |
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, before Tax | $ 200 | $ (1,316) | $ 491 |
PENSION AND OTHER RETIREMENTS_7
PENSION AND OTHER RETIREMENTS BENEFITS - Amounts Recognized in Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |||
Net actuarial loss (gain) | $ 152 | $ (1,316) | $ 527 |
Amortization of actuarial gain (loss) | 48 | 0 | (36) |
Total loss (gain) recognized in other comprehensive income (loss) | 200 | (1,316) | 491 |
Net actuarial gain | (1,323) | (1,523) | (207) |
Defined Benefit Plan, Accumulated Other Comprehensive (Income) Loss, before Tax | $ (1,323) | $ (1,523) | $ (207) |
PENSION AND OTHER RETIREMENTS_8
PENSION AND OTHER RETIREMENTS BENEFITS - Components of Net Periodic Benefit (Credit) Expense (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |||||
Service cost | $ 0 | $ 41 | $ 63 | ||
Interest cost | 377 | 326 | 1,047 | ||
Expected return on plan assets | 0 | 144 | (1,310) | ||
Amortization of net actuarial (gain) loss | (63) | 0 | 36 | ||
Settlement loss (income) | 59 | (1,178) | (644) | ||
Net periodic benefit cost (credit) | $ (808) | $ 373 | $ (667) | $ (808) | |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) Excluding Service Cost, Statement of Income or Comprehensive Income [Extensible Enumeration] | Other (expense) income, net | Other (expense) income, net | Other (expense) income, net | Other (expense) income, net | |
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Amortization of Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other (expense) income, net | Other (expense) income, net | Other (expense) income, net | Other (expense) income, net |
PENSION AND OTHER RETIREMENTS_9
PENSION AND OTHER RETIREMENTS BENEFITS - Net Periodic Benefit Costs Reflected in the Company's Financial Statements (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Defined Benefit Plan Disclosure | ||||
Net periodic benefit cost (credit) | $ (808) | $ 373 | $ (667) | $ (808) |
Selling, general and administrative expense | ||||
Defined Benefit Plan Disclosure | ||||
Net periodic benefit cost (credit) | 63 | 0 | 41 | |
Other expense (income), net | ||||
Defined Benefit Plan Disclosure | ||||
Net periodic benefit cost (credit) | $ (871) | $ 373 | $ (708) |
PENSION AND OTHER RETIREMENT_10
PENSION AND OTHER RETIREMENTS BENEFITS - Assumptions for Benefit Obligations (Details) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Defined Benefit Plan, Funded Plan | ||
Weighted-average assumptions used to determine net periodic benefit cost: | ||
Discount rate | 2.38% | |
Expected long-term rate of return on plan assets | 1.70% | |
Defined Benefit Plan, Unfunded Plan | ||
Weighted-average assumptions used to determine benefit obligation at year end: | ||
Discount rate | 4.81% | 5.01% |
Weighted-average assumptions used to determine net periodic benefit cost: | ||
Discount rate | 5.01% | 2.78% |
Rate of compensation increase | 0% | 3.50% |
PENSION AND OTHER RETIREMENT_11
PENSION AND OTHER RETIREMENTS BENEFITS - Fair Value of Plan Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | $ 0 | $ 2,500 | $ 2,522 | $ 12,902 |
Level 1, 2 and 3 | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 2,522 | |||
Level 1, 2 and 3 | Defined Benefit Plan, Cash and Cash Equivalents [Member] | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 2,522 | |||
Level 1 | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 2,522 | |||
Level 1 | Defined Benefit Plan, Cash and Cash Equivalents [Member] | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 2,522 | |||
Level 2 | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | |||
Level 2 | Defined Benefit Plan, Cash and Cash Equivalents [Member] | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | |||
Level 3 | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | |||
Level 3 | Defined Benefit Plan, Cash and Cash Equivalents [Member] | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | $ 0 |
PENSION AND OTHER RETIREMENT_12
PENSION AND OTHER RETIREMENTS BENEFITS - Projected Benefit Payments (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Defined Benefit Plan Disclosure | |
Defined Benefit Plan, Tax Status [Extensible Enumeration] | Nonqualified Plan |
2024 | $ 355 |
2025 | 425 |
2026 | 592 |
2027 | 588 |
2028 | 583 |
2029-2033 | $ 3,177 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) - USD ($) | 7 Months Ended | 12 Months Ended | |||
Jun. 08, 2023 | Dec. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock compensation expense | $ 7,000,000 | $ 4,900,000 | $ 8,700,000 | ||
Tax benefit recognized related to stock-based compensation | 900,000 | $ 400,000 | $ 500,000 | ||
Unrecognized Compensation Cost | $ 7,243,000 | $ 7,243,000 | |||
Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted (in dollars per share) | $ 2.55 | $ 5.42 | $ 13.48 | ||
Aggregate fair value of awards vested | $ 4,200,000 | $ 1,500,000 | |||
Vested during period (in shares) | 1,224,235 | 7,200,000 | |||
Restricted Stock Units (RSUs) | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 1 year | ||||
Restricted Stock Units (RSUs) | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 3 years | ||||
Restricted Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 24 months | ||||
Granted (in dollars per share) | $ 4.07 | $ 6.96 | $ 11.77 | ||
Aggregate fair value of awards vested | $ 200,000 | $ 500,000 | $ 0 | ||
Vested during period (in shares) | 58,194 | ||||
Performance Shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 3 years | ||||
Granted (in dollars per share) | $ 2.20 | $ 7.19 | $ 13.65 | ||
Unrecognized Compensation Cost | $ 4,400,000 | $ 4,400,000 | |||
Management Bonuses | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock compensation expense | $ 900,000 | ||||
2020 Long-Term Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of common shares authorized (in shares) | 4,000,000 | 13,300,000 |
STOCK-BASED COMPENSATION - Acti
STOCK-BASED COMPENSATION - Activity Related to RSUs and RSAs (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Restricted Stock Units (RSUs) | |||
Shares | |||
Beginning balance, outstanding (in shares) | 1,538,759 | ||
Granted (in shares) | 3,023,061 | ||
Vested (in shares) | (1,224,235) | (7,200,000) | |
Forfeited (in shares) | (1,220,914) | ||
Ending balance, outstanding and nonvested (in shares) | 2,116,671 | 1,538,759 | |
Weighted Average Grant Date Fair Value (per share) | |||
Beginning balance, outstanding (in dollars per share) | $ 6.65 | ||
Granted (in dollars per share) | 2.55 | $ 5.42 | $ 13.48 |
Vested (in dollars per share) | 6.25 | ||
Forfeited (in dollars per share) | 2.97 | ||
Ending balance, outstanding and nonvested (in dollars per share) | $ 3.19 | $ 6.65 | |
Weighted Average Remaining Contractual Term (in years) | |||
Beginning balance (in years) | 1 year 1 month 13 days | 8 months 15 days | |
Ending balance (in years) | 1 year 1 month 13 days | 8 months 15 days | |
Restricted Stock | |||
Shares | |||
Beginning balance, outstanding (in shares) | 131,470 | ||
Granted (in shares) | 141,280 | ||
Vested (in shares) | (58,194) | ||
Ending balance, outstanding and nonvested (in shares) | 214,556 | 131,470 | |
Weighted Average Grant Date Fair Value (per share) | |||
Beginning balance, outstanding (in dollars per share) | $ 8.75 | ||
Granted (in dollars per share) | 4.07 | $ 6.96 | 11.77 |
Vested (in dollars per share) | 11 | ||
Ending balance, outstanding and nonvested (in dollars per share) | $ 5.06 | $ 8.75 | |
Weighted Average Remaining Contractual Term (in years) | |||
Beginning balance (in years) | 1 year 1 month 28 days | 1 year 2 months 8 days | |
Ending balance (in years) | 1 year 1 month 28 days | 1 year 2 months 8 days | |
Performance Shares | |||
Shares | |||
Beginning balance, outstanding (in shares) | 631,377 | ||
Granted (in shares) | 1,934,388 | ||
Forfeited (in shares) | (1,035,405) | ||
Ending balance, outstanding and nonvested (in shares) | 1,530,360 | 631,377 | |
Weighted Average Grant Date Fair Value (per share) | |||
Beginning balance, outstanding (in dollars per share) | $ 8.49 | ||
Granted (in dollars per share) | 2.20 | $ 7.19 | $ 13.65 |
Forfeited (in dollars per share) | 3.06 | ||
Ending balance, outstanding and nonvested (in dollars per share) | $ 4.21 | $ 8.49 | |
Weighted Average Remaining Contractual Term (in years) | |||
Beginning balance (in years) | 1 year 9 months 21 days | 1 year 10 months 17 days | |
Ending balance (in years) | 1 year 9 months 21 days | 1 year 10 months 17 days |
STOCK-BASED COMPENSATION - Unre
STOCK-BASED COMPENSATION - Unrecognized Compensation Cost on Nonvested Awards (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Share-Based Payment Arrangement [Abstract] | |
Unrecognized Compensation Cost | $ 7,243 |
Weighted Avg. Remaining Recognition Period (in years) | 1 year 4 months 20 days |
EARNINGS PER SHARE - Computatio
EARNINGS PER SHARE - Computation of Basic and Diluted (Loss) Earnings Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
EPS numerator: | |||
Net (loss) income attributable to common shareholders | $ (38,096) | $ (58,752) | $ 83 |
Less: Change in fair value of warrant liabilities | 0 | 0 | (29) |
Numerator - diluted | $ (38,096) | $ (58,752) | $ 54 |
EPS denominator: | |||
Weighted average shares outstanding - basic (in shares) | 42,483,083 | 41,481,079 | 38,505,458 |
Effect of dilutive securities (in shares) | 0 | 0 | 1,370,929 |
Weighted average shares outstanding - diluted (in shares) | 42,483,083 | 41,481,079 | 39,876,387 |
Net earnings (loss) per share: | |||
Basic (in dollars per share) | $ (0.90) | $ (1.42) | $ 0 |
Diluted (in dollars per share) | $ (0.90) | $ (1.42) | $ 0 |
EARNINGS PER SHARE - Narrative
EARNINGS PER SHARE - Narrative (Details) - shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Warrant | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 20,263,300 | 20,263,300 | |
Restricted Stock Units (RSUs) | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 2,116,671 | 1,538,759 | |
Restricted Stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 214,556 | 131,470 | |
Performance Stock Units (PSUs) | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 1,530,360 | 631,377 | 282,141 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - Change in the Components of Accumulated Other Comprehensive Loss, Net of Tax (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
AOCI Attributable to Parent, Net of Tax | ||
Beginning balance | $ 274,551 | $ 313,871 |
Other comprehensive income (loss) before reclassifications | 11,215 | (10,543) |
Amounts reclassified from AOCI | (924) | (186) |
Ending balance | 251,690 | 274,551 |
Total Accumulated Other Comprehensive Income (Loss) | ||
AOCI Attributable to Parent, Net of Tax | ||
Beginning balance | (1,042) | 9,687 |
Ending balance | 9,249 | (1,042) |
Net Currency Translation Gains (Losses) | ||
AOCI Attributable to Parent, Net of Tax | ||
Beginning balance | (4,711) | 8,758 |
Other comprehensive income (loss) before reclassifications | 11,787 | (13,469) |
Amounts reclassified from AOCI | 0 | 0 |
Ending balance | 7,076 | (4,711) |
Funded Status of Benefit Plans | ||
AOCI Attributable to Parent, Net of Tax | ||
Beginning balance | 3,669 | 929 |
Other comprehensive income (loss) before reclassifications | (544) | 2,926 |
Amounts reclassified from AOCI | (204) | (186) |
Ending balance | 2,921 | 3,669 |
Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent | ||
AOCI Attributable to Parent, Net of Tax | ||
Beginning balance | 0 | 0 |
Amounts reclassified from AOCI | (720) | 0 |
Ending balance | (748) | 0 |
Other Comprehensive Income (Loss), before Reclassifications, before Tax | $ (28) | $ 0 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Jul. 31, 2020 | |
Related Party Transaction [Line Items] | |||||
Long-term debt, carrying value | $ 421,679 | $ 421,679 | |||
Watermill | |||||
Related Party Transaction [Line Items] | |||||
Costs and Expenses | $ 500 | ||||
Accounts Payable | $ 900 | ||||
Watermill | Wholesome | |||||
Related Party Transaction [Line Items] | |||||
Costs and Expenses | $ 2,000 | ||||
Limited Liability Company | WS Services | |||||
Related Party Transaction [Line Items] | |||||
Interest in partnership (as a percent) | 50% | 50% | |||
Gain (loss) on sale of investments | $ (500) | ||||
Limited Liability Company | WS Services | Promissory Note | |||||
Related Party Transaction [Line Items] | |||||
Long-term debt, carrying value | 200 | $ 200 | |||
Limited Liability Company | WS Services | Other assets | |||||
Related Party Transaction [Line Items] | |||||
Equity method investments | $ 700 | 700 | $ 700 | ||
Related Party | |||||
Related Party Transaction [Line Items] | |||||
Costs and Expenses | $ 700 | 900 | |||
Accounts Payable | $ 100 |
BUSINESS SEGMENTS - Narrative (
BUSINESS SEGMENTS - Narrative (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 USD ($) segment | Dec. 31, 2022 | Dec. 31, 2021 | |
Concentration Risk [Line Items] | |||
Number of reportable segments | segment | 2 | ||
One Customer | Revenue from Contract with Customer Benchmark | Customer Concentration Risk | Branded CPG | |||
Concentration Risk [Line Items] | |||
Concentration risk (as a percent) | 13.80% | 14.10% | 10.60% |
Uzbekistan Manufacturer | Cost of Goods and Service, Product and Service Benchmark | Supplier Concentration Risk | |||
Concentration Risk [Line Items] | |||
Purchases | $ | $ 13 | ||
Concentration risk (as a percent) | 32.10% |
BUSINESS SEGMENTS - Selected Fi
BUSINESS SEGMENTS - Selected Financial Information Relating to the Business' Reportable Segments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||
Product revenues, net | $ 550,913 | $ 538,272 | $ 493,973 |
Operating income (loss) | 15,395 | (24,646) | 22,816 |
Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Product revenues, net | 550,913 | 538,272 | 493,973 |
Operating income (loss) | 43,848 | 2,323 | 56,778 |
Corporate, Non-Segment | |||
Segment Reporting Information [Line Items] | |||
Operating income (loss) | (28,453) | (26,969) | (33,962) |
Branded CPG | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Product revenues, net | 426,287 | 422,638 | 389,174 |
Operating income (loss) | 8,167 | (30,182) | 34,918 |
Flavors & Ingredients | |||
Segment Reporting Information [Line Items] | |||
Product revenues, net | 124,626 | 115,634 | 104,799 |
Flavors & Ingredients | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Product revenues, net | 124,626 | 115,634 | 104,799 |
Operating income (loss) | $ 35,681 | $ 32,505 | $ 21,860 |
BUSINESS SEGMENTS - Revenues Di
BUSINESS SEGMENTS - Revenues Disaggregated by Geographic Operating Segments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||
Product revenues, net | $ 550,913 | $ 538,272 | $ 493,973 |
North America | |||
Segment Reporting Information [Line Items] | |||
Product revenues, net | 366,207 | 357,175 | 318,958 |
Europe | |||
Segment Reporting Information [Line Items] | |||
Product revenues, net | 95,095 | 92,272 | 96,013 |
India, Middle East and Africa | |||
Segment Reporting Information [Line Items] | |||
Product revenues, net | 16,201 | 19,940 | 14,801 |
Asia-Pacific | |||
Segment Reporting Information [Line Items] | |||
Product revenues, net | 57,731 | 53,300 | 51,598 |
Latin America | |||
Segment Reporting Information [Line Items] | |||
Product revenues, net | $ 15,679 | $ 15,585 | $ 12,603 |
BUSINESS SEGMENTS - Long-Lived
BUSINESS SEGMENTS - Long-Lived Assets Disaggregated by Geographic Operating Segments (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | $ 54,937 | $ 58,092 |
United States | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 20,990 | 24,516 |
China | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 14,421 | 14,805 |
Czech Republic | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 6,355 | 6,451 |
France | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 12,079 | 10,960 |
Other Foreign Countries | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | $ 1,092 | $ 1,360 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - Subsequent Event - Sweet Oak Merger Sub, LLC $ / shares in Units, $ in Millions | Feb. 12, 2024 USD ($) $ / shares |
Subsequent Event [Line Items] | |
Merger agreement, common stockholders approval, percentage | 0.6666 |
Business acquisition, share price (in usd per share) | $ / shares | $ 4.875 |
Merger agreement, warrants exercisable, threshold | 30 days |
Merger agreement, contract termination fee | $ 20 |
Ozark Holdings, LLC | |
Subsequent Event [Line Items] | |
Merger agreement, contract termination fee | $ 40 |