Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 13, 2015 | Jun. 30, 2014 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | PHOTOMEDEX INC | ||
Entity Central Index Key | 711665 | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $144,427,978 | ||
Entity Common Stock, Shares Outstanding | 22,101,718 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $10,605 | $45,388 |
Short term bank deposit | 87 | 14,113 |
Accounts receivable, net of allowance for doubtful accounts of $13,559 and $10,734, respectively | 21,977 | 27,218 |
Inventories, net | 19,380 | 27,547 |
Deferred tax asset, net | 762 | 13,041 |
Prepaid expenses and other current assets | 8,347 | 12,597 |
Assets held for sale, net | 70,855 | 0 |
Total current assets | 132,013 | 139,904 |
Property and equipment, net | 13,802 | 10,489 |
Patents and licensed technologies, net | 8,811 | 10,832 |
Other intangible assets, net | 8,337 | 9,701 |
Goodwill, net | 24,048 | 24,930 |
Deferred tax asset, net | 567 | 24,039 |
Other assets, net | 185 | 213 |
Total assets | 187,763 | 220,108 |
Current liabilities: | ||
Current portion of notes payable | 704 | 838 |
Current portion of long term debt | 38,732 | 10,000 |
Accounts payable | 12,419 | 14,785 |
Accrued compensation and related expenses | 2,622 | 3,230 |
Other accrued liabilities | 13,022 | 22,032 |
Current portion of deferred revenues | 4,480 | 5,961 |
Liabilities held for sale | 34,497 | 0 |
Total current liabilities | 106,476 | 56,846 |
Long-term liabilities: | ||
Notes payable, net of current maturities | 25 | 82 |
Long term debt, net of current maturities | 37,768 | 0 |
Deferred revenues, net of current portion | 1,127 | 2,758 |
Other liabilities | 102 | 61 |
Total liabilities | 145,498 | 59,747 |
Commitment and contingencies (Note 11) | ||
Stockholders' equity: | ||
Preferred Stock, $.01 par value, 5,000,000 shares authorized; 0 shares issued and outstanding at December 31, 2014 and 2013 | 0 | 0 |
Common Stock, $.01 par value, 50,000,000 shares authorized; 20,376,245 and 18,903,245 shares issued and outstanding, respectively | 204 | 189 |
Additional paid-in capital | 110,391 | 104,954 |
Retained earnings (accumulated deficit) | -67,817 | 53,679 |
Accumulated other comprehensive (loss) income | -513 | 1,539 |
Total stockholders' equity | 42,265 | 160,361 |
Total liabilities and stockholders' equity | $187,763 | $220,108 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Current assets: | ||
Accounts receivable, allowance for doubtful accounts | $13,559 | $10,734 |
Stockholders' equity | ||
Preferred Stock, par value (in dollars per share) | $0.01 | $0.01 |
Preferred Stock, authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred Stock, issued (in shares) | 0 | 0 |
Preferred Stock, outstanding (in shares) | 0 | 0 |
Common Stock, par value (in dollars per share) | $0.01 | $0.01 |
Common Stock, authorized (in shares) | 50,000,000 | 50,000,000 |
Common Stock, issued (in shares) | 20,376,245 | 18,903,245 |
Common Stock, outstanding (in shares) | 20,376,245 | 21,043,947 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Revenues: | |||
Product sales | $140,670 | $209,175 | $212,210 |
Services | 22,871 | 15,489 | 8,441 |
Total revenues | 163,541 | 224,664 | 220,651 |
Cost of revenues: | |||
Product sales | 31,400 | 38,229 | 41,558 |
Services | 7,219 | 6,806 | 5,084 |
Total cost of revenues | 38,619 | 45,035 | 46,642 |
Gross profit | 124,922 | 179,629 | 174,009 |
Operating expenses: | |||
Engineering and product development | 3,086 | 3,306 | 2,914 |
Selling and marketing | 107,169 | 127,528 | 116,487 |
General and administrative | 35,711 | 26,750 | 27,330 |
Total operating expenses | 145,966 | 157,584 | 146,731 |
(Loss) income from continuing operations before interest and other financing income (expense), net | -21,044 | 22,045 | 27,278 |
Interest and other financing income (expense), net | -4,387 | 702 | -351 |
(Loss) income from continuing operations before income taxes | -25,431 | 22,747 | 26,927 |
Income tax expense | -36,312 | -4,370 | -4,438 |
(Loss) profit from continuing operations | -61,743 | 18,377 | 22,489 |
Discontinued operations: | |||
Loss from discontinued operations, net of taxes of $5,496 | -15,155 | 0 | 0 |
Estimated loss on sale from discontinued operations | -44,598 | 0 | 0 |
Net (loss) income | -121,496 | 18,377 | 22,489 |
Basic net (loss) income per share: | |||
Continuing operations (in dollars per share) | ($3.25) | $0.90 | $1.10 |
Discontinued operations (in dollars per share) | ($3.16) | $0 | $0 |
Basic (in dollars per share) | ($6.41) | $0.90 | $1.10 |
Diluted net (loss) income per share: | |||
Continuing operations (in dollars per share) | ($3.25) | $0.89 | $1.08 |
Discontinued operations (in dollars per share) | ($3.16) | $0 | $0 |
Diluted (in dollars per share) | ($6.41) | $0.89 | $1.08 |
Shares used in computing net income (loss) per share: | |||
Basic (in shares) | 18,940,355 | 20,454,970 | 20,355,520 |
Diluted (in shares) | 18,940,355 | 20,657,240 | 20,764,354 |
Other comprehensive (loss) income: | |||
Foreign currency translation adjustments | -2,052 | 678 | 859 |
Comprehensive (loss) income | ($123,548) | $19,055 | $23,348 |
CONSOLIDATED_STATEMENTS_OF_COM1
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (Parenthetical) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2014 |
Discontinued operations: | |
Loss from discontinued operations, tax | $5,496 |
CONSOLIDATED_STATEMENTS_OF_CHA
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (USD $) | Common Stock [Member] | Additional Paid-In Capital [Member] | Treasury Stock [Member] | Retained Earnings (Accumulated Deficit) [Member] | Accumulated Other Comprehensive (Loss) Income [Member] | Total |
In Thousands, except Share data, unless otherwise specified | ||||||
BALANCE at Dec. 31, 2011 | $188 | $97,972 | ($250) | $12,813 | $2 | $110,725 |
BALANCE (in shares) at Dec. 31, 2011 | 18,821,728 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of warrants | 0 | 98 | 0 | 0 | 0 | 98 |
Stock-based compensation - grants of common stock | 0 | 405 | 0 | 0 | 0 | 405 |
Stock-based compensation - grant of common stock (in shares) | 30,000 | |||||
Stock-based compensation related to stock options and restricted stock | 0 | 5,709 | 0 | 0 | 0 | 5,709 |
Stock options issued to consultants for services | 0 | 83 | 0 | 0 | 0 | 83 |
Issuance of common stock, net | 30 | 37,484 | 0 | 0 | 0 | 37,514 |
Issuance of common stock, net (in shares) | 3,023,432 | 3,023,432 | ||||
Repurchase and retirement of common stock | -9 | -10,747 | 0 | 0 | 0 | -10,756 |
Repurchase and retirement of common stock (in shares) | -842,961 | |||||
Exercise of stock options | 0 | 67 | 0 | 0 | 0 | 67 |
Exercise of stock options (in shares) | 10,048 | |||||
Warrants exercised | 1 | 133 | 0 | 0 | 0 | 134 |
Warrants exercised (in shares) | 17,756 | |||||
Retirement of treasury stock | 0 | -250 | 250 | 0 | 0 | 0 |
Retirement of treasury stock (in shares) | -16,056 | |||||
Other comprehensive income | 0 | 0 | 0 | 0 | 859 | 859 |
Net income (loss) | 0 | 0 | 0 | 22,489 | 0 | 22,489 |
BALANCE at Dec. 31, 2012 | 210 | 130,954 | 0 | 35,302 | 861 | 167,327 |
BALANCE (in shares) at Dec. 31, 2012 | 21,043,947 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock-based compensation related to stock options and restricted stock | 0 | 4,892 | 0 | 0 | 0 | 4,892 |
Stock options issued to consultants for services | 0 | 93 | 0 | 0 | 0 | 93 |
Repurchase and retirement of common stock | -21 | -31,008 | 0 | 0 | 0 | -31,029 |
Repurchase and retirement of common stock (in shares) | -2,144,452 | |||||
Exercise of stock options | 0 | 23 | 0 | 0 | 0 | 23 |
Exercise of stock options (in shares) | 3,750 | |||||
Other comprehensive income | 0 | 0 | 0 | 0 | 678 | 678 |
Net income (loss) | 0 | 0 | 0 | 18,377 | 0 | 18,377 |
BALANCE at Dec. 31, 2013 | 189 | 104,954 | 0 | 53,679 | 1,539 | 160,361 |
BALANCE (in shares) at Dec. 31, 2013 | 18,903,245 | 21,043,947 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of warrants | 0 | 81 | 0 | 0 | 0 | 81 |
Stock-based compensation related to stock options and restricted stock | 0 | 4,862 | 0 | 0 | 0 | 4,862 |
Stock options issued to consultants for services | 0 | 76 | 0 | 0 | 0 | 76 |
Stock options issued to consultants for services (in shares) | 1,663 | |||||
Issuance of common stock, net | 7 | 1,406 | 0 | 0 | 0 | 1,413 |
Issuance of common stock, net (in shares) | 645,000 | 645,000 | ||||
Restricted stock issued, net of payroll taxes paid | 8 | -988 | 0 | 0 | 0 | -980 |
Restricted stock issued, net of payroll taxes paid (in shares) | 826,337 | |||||
Other comprehensive income | 0 | 0 | 0 | 0 | -2,052 | -2,052 |
Net income (loss) | 0 | 0 | 0 | -121,496 | 0 | -121,496 |
BALANCE at Dec. 31, 2014 | $204 | $110,391 | $0 | ($67,817) | ($513) | $42,265 |
BALANCE (in shares) at Dec. 31, 2014 | 20,376,245 | 20,376,245 |
CONSOLIDATED_STATEMENTS_OF_CHA1
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) | 12 Months Ended |
Dec. 31, 2012 | |
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY [Abstract] | |
Purchase of Company stock (in shares) | 16,056 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Cash Flows From Operating Activities: | |||
Net (loss) income | ($121,496) | $18,377 | $22,489 |
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | |||
Depreciation and amortization | 6,912 | 6,119 | 5,611 |
Provision for doubtful accounts | 7,661 | 5,958 | 4,629 |
Deferred income taxes | 35,699 | 2,589 | -2,330 |
Stock-based compensation | 4,938 | 4,985 | 6,197 |
Amortization of bank debt issue costs and discount | 2,358 | 0 | 0 |
Loss on disposal of property and equipment | -10 | 0 | 0 |
Changes in operating assets and liabilities: | |||
Accounts receivable | -2,718 | -13,944 | -11,254 |
Inventories | 7,967 | -4,967 | -3,195 |
Prepaid expenses and other assets | 2,378 | 843 | -8,583 |
Accounts payable | -2,244 | 4,658 | 1,787 |
Accrued compensation and related expenses | -588 | 733 | -1,316 |
Other accrued liabilities (see Note 9) | -8,839 | -444 | 5,719 |
Other liabilities | 0 | 0 | -1 |
Deferred revenues | -3,083 | 130 | 5,243 |
Net cash (used in) provided by operating activities - continuing operations | -71,065 | 25,037 | 24,996 |
Net cash provided by operating activities - discontinued operations | 46,894 | 0 | 0 |
Net cash (used in) provided by operating activities | -24,171 | 25,037 | 24,996 |
Cash Flows From Investing Activities: | |||
Purchases of property and equipment | -251 | -943 | -573 |
Lasers placed into service | -6,746 | -5,476 | -3,221 |
Proceeds from (investments in) short-term deposit | 14,026 | 3,887 | -18,000 |
Proceeds on sale of property and equipment | 20 | 0 | 0 |
Acquisition, net of cash received | -77,510 | 84 | 0 |
Net cash used in investing activities - continuing operations | -70,461 | -2,448 | -21,794 |
Net cash used in investing activities - discontinued operations | -5,218 | 0 | 0 |
Net cash used in investing activities | -75,679 | -2,448 | -21,794 |
Cash Flows From Financing Activities: | |||
Repurchase of common stock | 0 | -31,029 | -10,756 |
Proceeds from issuance of common stock, net | 1,413 | 0 | 37,514 |
Issuance of warrants | 81 | 0 | 98 |
Issuance of restricted stock, net of taxes | -980 | 0 | 0 |
Proceeds from option exercises | 0 | 23 | 67 |
Proceeds from warrant exercises | 0 | 0 | 134 |
Proceeds from issuance of debt | 85,000 | 10,000 | 0 |
Repayment of debt | -18,500 | 0 | 0 |
Payments on notes payable | -838 | -623 | -465 |
Repayment of long-term debt | 0 | -43 | -2,000 |
Net cash provided by (used in) financing activities - continuing operations | 66,176 | -21,672 | 24,592 |
Net cash (used in) financing activities - discontinued operations | -523 | 0 | 0 |
Net cash (used in) provided by financing activities | 65,653 | -21,672 | 24,592 |
Effect of exchange rate changes on cash | -586 | 123 | 5 |
Net (decrease) increase in cash and cash equivalents | -34,783 | 1,040 | 27,799 |
Cash and cash equivalents, beginning of year | 45,388 | 44,348 | 16,549 |
Cash and cash equivalents, end of year | 10,605 | 45,388 | 44,348 |
Supplemental information: | |||
Cash paid for income taxes | 1,041 | 7,233 | 12,976 |
Cash paid for interest | $2,216 | $13 | $79 |
The_Company_and_Summary_of_Sig
The Company and Summary of Significant Accounting Policies | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
The Company and Summary of Significant Accounting Policies [Abstract] | |||||||||
The Company and Summary of Significant Accounting Policies | Note 1 | ||||||||
The Company and Summary of Significant Accounting Policies: | |||||||||
The Company: | |||||||||
Background | |||||||||
PhotoMedex, Inc. (and its subsidiaries) (the "Company") is a Global Skin Health company providing integrated disease management and aesthetic solutions to dermatologists, professional aestheticians and consumers. The Company provides proprietary products and services that address skin diseases and conditions including psoriasis, vitiligo, acne, actinic keratosis (a precursor to certain types of skin cancer), photo damage and unwanted hair. | |||||||||
On December 13, 2011, the Company closed the merger with Radiancy, Inc. Immediately following the reverse merger, the pre-reverse merger shareholders of PhotoMedex, Inc. ("Pre-merged PhotoMedex") collectively owned approximately 20% of the Company's outstanding common stock, and the former Radiancy, Inc. stockholders owned approximately 80% of the Company's outstanding common stock. | |||||||||
On March 3, 2014, PhotoMedex' wholly-owned subsidiary, Radiancy, Inc., formed a wholly-owned subsidiary in Hong Kong, Radiancy (HK) Limited, through which the Company has started to directly market certain products and services to patients and consumers in selected markets in that region. | |||||||||
On March 5, 2014, PhotoMedex formed a wholly-owned subsidiary in India, PhotoMedex India Private Limited, through which the Company is directly marketing certain products and services to patients and consumers in selected markets in that country. | |||||||||
On May 12, 2014, PhotoMedex completed the acquisition of 100% of the shares of LCA-Vision Inc. ("LCA-Vision" or "LCA"), which was a publicly–traded Delaware corporation. LCA is a provider of fixed-site laser vision corrections services at its LasikPlus® vision centers. Through this acquisition, the Company added an additional operating segment to its organization. The Company planned to begin to directly market certain of its existing products from these centers. The results of operations of LCA-Vision have been included from May 13, 2014 through December 31, 2014 in the Company's consolidated financial statements as a discontinued operation. (See Note 3, Acquisition of LCA-Vision Inc.). | |||||||||
On August 18, 2014, the Company formed a wholly-owned subsidiary in Korea, PhotoMedex Korea Limited, through which the Company plans to directly market certain products and services to patients and consumers in selected markets in that country. | |||||||||
On January 31, 2015, the Company sold 100% of the shares of LCA-Vision Inc. for $40 million in cash. Excluding working capital adjustments and professional fees, the Company realized net proceeds of approximately $36.5 million. The LCA-Vision assets and liabilities are considered to be held for sale as of December 31, 2014. For the statement of operations, the activity related to LCA is captured as discontinued operations. (See Note 2, Discontinued Operations.) | |||||||||
On May 12, 2014, the Company entered into an $85 million senior secured credit facilities ("the Facilities") with JP Morgan Chase ("Chase") which included a $10 million revolving credit facility and a $75 million four-year term loan. The facilities were utilized to refinance the existing term debt with Chase, fund the acquisition of LCA and for working capital and other general corporate purposes. | |||||||||
There are financial covenants including a maximum leverage covenant and a minimum fixed charge covenant, which the Company must maintain. These covenants will be determined quarterly based on a rolling past four quarters of financial data. As of June 30, 2014 the Company failed to meet the financial covenants and as of December 31, 2014, the Company continued to fail to meet these covenants and remains in default. | |||||||||
Effective February 28, 2015, the Company entered into a Second Amended and Restated Forbearance Agreement (the "Second Amended Forbearance Agreement") with the lenders (the "Lenders") that are parties to the Credit Agreement dated May 12, 2014, and with JP Morgan Chase, as Administrative Agent for the Lenders. | |||||||||
Pursuant to the terms of the Second Amended Forbearance Agreement, the Lenders have agreed to forbear from exercising their rights and remedies with respect to the Specified Events of Default from August 25, 2014 until April 1, 2016, or earlier if an event of default occurs (the "Forbearance Period"). Chase and the Lenders agreed that the Company shall not be obligated to pay the principal amounts set forth in the Credit Agreement for any date identified therein during the period beginning on February 28, 2015 and ending on the end of the Forbearance Period (the "Effective Period"), and that any failure to do so shall not constitute a default or event of default. Instead, the Lenders and the Company agreed that the Company would make prepayments against the Term Loan of $250,000 on the first business day of each month during the Forbearance Period, which will be applied in direct order of maturity. The Company also agreed that, on or before the fifth calendar day of each month, the Company would pay against the Term Loan $125,000 to the extent that the cash-on-hand exceeds $5 million, and 100% of the cash-on-hand in excess of $7 million, also to be applied to the Term Loan in inverse order of maturity. | |||||||||
Under the provisions of the Second Amended Forbearance Agreement, the Company will not have to comply with certain financial covenants contained in the Credit Agreement for the Forbearance Period, and that any failure to do so shall not constitute a default or event of default. However, the Company will have to meet certain minimum EBITDA targets (as defined in the forbearance agreement) for the quarters ending March 31, 2015, June 30, 2015, September 30, 2015 and December 31, 2015. | |||||||||
Pursuant to the Second Amended Forbearance Agreement, all loans under the Facilities shall, beginning November 1, 2014, bear interest at the CB Floating Rate (as defined in the Credit Agreement) plus 4.00%. Additionally, following the occurrence and continuance of any default or event of default (other than a Specified Event of Default), the Company's obligations under the Facilities shall, at the option of Chase and the Lenders, bear interest at the rate of 2.00% plus the rate otherwise in effect. | |||||||||
The Company and its subsidiaries have also agreed not to pay in cash any compensation to either the Company's Chief Executive Officer or President that is based on a percentage of sales or another metric other than those officer's base salary, perquisites and standard benefits provided to or on behalf of those executives under the terms of their employment agreements. Those payments may be accrued or deferred and paid in cash only after the repayment of the Facilities in full. | |||||||||
The Company has agreed to provide, on or before May 29, 2015, a strategic business plan for the overall direction of the Company's and its subsidiaries' businesses, including projected income statements, balance sheets, schedules of cash receipts and cash disbursements, payments and month-end balances, and detailed notes and assumptions, projected on a monthly basis through April 1, 2016. The Company has also agreed to provide quarterly updates to that plan by August 31, 2015, November 30, 2015 and February 29, 2016. | |||||||||
The Company continues to retain the services of both Getzler Henrich & Assoc. LLC, a third-party independent business advisor, as well as Canaccord Genuity, Inc., a banking and financial services company, and has also retained the services of Nomura Securities International, Inc., also a banking and financial services company. During the Forbearance Agreement and amendments, the Company and these advisors will continue to prepare and distribute offering memoranda and other marketing materials to prospective lenders with regard to a proposed credit facility for the Company, the proceeds of which would be in an amount sufficient to repay in full and in cash the Company's remaining obligations under the Facilities, and to explore other strategic alternatives. The closing of any such refinancing or alternative arrangement would occur no later than the end of the Forbearance Period. | |||||||||
The Company agreed to limit certain capital expenditures to $100,000 per quarter, except for those involving the Company's XTRAC® or VTRAC® medical devices, and will not make investments or acquire any other interests in affiliated companies except as agreed to by the Lenders. | |||||||||
As consideration for the Lender's entry into the Second Amended Forbearance Agreement, the Company has agreed to pay the Lenders certain forbearance fees (the "Forbearance Fees"), which are earned on the last business day of each of the specified months: for May and June 2015, $750,000 each month; for July through September 2015, $1,000,000 each month; for October through December 2015, $1,250,000 each month; and for January through March 2016, $1,500,000 each month. However, should the Company complete a capital transaction acceptable to the Lenders that reduces the then-outstanding principal balance of the Term Loan to less than $10 million and repays all Forbearance Fees accrued and unpaid to that date, the monthly Forbearance Fee for the remainder of the Forbearance Period shall be earned and accrued in an amount that is 50% of the amount specified for each of the remaining months. In addition, the $500,000 Forbearance Fee set forth in Section 4.10(b) of the Amended Forbearance Agreement remains due and payable to the Lenders on the earlier of the Expiration Date or the Termination Date of the Forbearance Period. | |||||||||
The Second Amended Forbearance Agreement is also subject to customary covenants, including limitations on the incurrence of or payments on indebtedness to other persons or entities and requirements that the Company provide periodic financial information and information regarding the status of outstanding litigation involving the Company and its subsidiaries to the Lenders. | |||||||||
Summary of Significant Accounting Policies: | |||||||||
Accounting Principles | |||||||||
The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP"). Certain reclassifications from the prior year presentation have been made to conform to the current year presentation. These reclassifications did not have material impact on the Company's equity, net assets, results of operations or cash flows. | |||||||||
Principles of Consolidation | |||||||||
The consolidated financial statements include the accounts of the Company and the wholly and majority owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. | |||||||||
Held for Sale Classification and Discontinued Operations | |||||||||
A disposal group is reported as held for sale when management has approved or received approval to sell and is committed to a formal plan, the disposal group is available for immediate sale, the business is being actively marketed, the sale is anticipated to occur during the next 12 months and certain other specified criteria are met. A disposal group classified as held for sale is recorded at the lower of its carrying amount or estimated fair value less cost to sell. If the carrying value of the business exceeds its estimated fair value less cost to sell, a loss is recognized. However, when disposal group meets the held for sale criteria, the Company, first evaluates whether the carrying amounts of the assets not covered by ASC 360-10 included in the disposal group (such as goodwill) are required to be adjusted in accordance with other applicable GAAP before measuring the disposal group at fair value less cost to sell. | |||||||||
Assets and liabilities related to a disposal group classified as held for sale are segregated in the consolidated balance sheet in the period in which the business is classified as held for sale. | |||||||||
Operations of a disposal group are reported as discontinued operations if the disposal group is classified as held for sale, the operations and cash flows of the business have been or will be eliminated from our ongoing operations as a result of a disposal transaction and we will not have any significant continuing involvement in the operations of the business after the disposal transaction. The results of discontinued operations are reported in discontinued operations in the consolidated statement of operations for current and prior periods commencing in the period in which the business meets the criteria of a discontinued operation, and include any gain or loss recognized on closing or adjustment of the carrying amount to fair value less cost to sell. Depreciation is not recorded on assets of a business while it is classified as held for sale. | |||||||||
At December 31, 2014, held for sale assets and liabilities consisted of LCA operating segment, and its results of operations are presented as discontinued operations in the consolidated statement of operations (see also Note 2 Discontinued Operations). | |||||||||
Use of Estimates | |||||||||
The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States ("US GAAP") requires management to make estimates and assumptions that affect amounts reported of assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from those estimates and be based on events different from those assumptions. As of December 31, 2014, the more significant estimates include (1) revenue recognition, including provision for sales return and valuation allowances of accounts receivable; (2) valuation allowance of deferred tax assets and uncertainty in tax positions; and (3) stock based compensation. | |||||||||
Functional Currency | |||||||||
The currency of the primary economic environment in which the operations of the Company, its U.S. subsidiaries and Radiancy Ltd., its subsidiary in Israel, are conducted is the US dollar ("$" or "dollars"). Thus, the functional currency of the Company and its subsidiaries (other than the foreign subsidiaries mentioned below) is the dollar (which is also the reporting currency of the Group). The operations of the other foreign subsidiaries are each conducted in the local currency of the subsidiary. These currencies include: Great Britain Pounds (GBP), Brazilian Real (BRL), Hong Kong Dollar (HKD), Columbian Peso (COP) and Indian Rupee (INR). Substantially all of the Group's revenues are derived in dollars or in other currencies linked to the dollar. Purchases of most materials and components are carried out in, or linked to the dollar. | |||||||||
Balances denominated in, or linked to, foreign currencies are stated on the basis of the exchange rates prevailing at the balance sheet date. For foreign currency transactions included in the statement of comprehensive income (loss), the exchange rates applicable to the relevant transaction dates are used. Transaction gains or losses arising from changes in the exchange rates used in the translation of such balances are carried to financing income or expenses. | |||||||||
Assets and liabilities of foreign subsidiaries, whose functional currency is the local currency, are translated from its respective functional currency to U.S. dollars at the balance sheet date exchange rates. Income and expense items are translated at the average rates of exchange prevailing during the year. Translation adjustments are reflected in the consolidated balance sheets as a component of accumulated other comprehensive income or loss. Deferred taxes are not provided on translation adjustments as the earnings of the subsidiaries are considered to be permanently reinvested. | |||||||||
Fair Value Measurements | |||||||||
The Company measures and discloses fair value in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification 820, Fair Value Measurements and Disclosures ("ASC Topic 820"). ASC Topic 820 defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions there exists a three-tier fair-value hierarchy, which prioritizes the inputs used in measuring fair value as follows: | |||||||||
• | Level 1 - unadjusted quoted prices are available in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date. | ||||||||
• | Level 2 – pricing inputs are other than quoted prices in active markets that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. | ||||||||
• | Level 3 – pricing inputs are unobservable for the non-financial asset or liability and only used when there is little, if any, market activity for the non-financial asset or liability at the measurement date. The inputs into the determination of fair value require significant management judgment or estimation. Fair value is determined using comparable market transactions and other valuation methodologies, adjusted as appropriate for liquidity, credit, market and/or other risk factors. | ||||||||
This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. | |||||||||
The fair value of cash and cash equivalents and short term bank deposits are based on its demand value, which is equal to its carrying value. The estimated fair values of notes payable, short-term and long-term debt which are based on borrowing rates that are available to the Company for loans with similar terms, collateral and maturity approximate the carrying values. Additionally, the carrying value of all other monetary assets (including long term receivables which bear interest) and liabilities (including the secured credit facilities) is estimated to be equal to their fair value due to the short-term nature of these instruments. | |||||||||
Derivative financial instruments are measured at fair value, on a recurring basis. The fair value of derivatives generally reflects the estimated amounts that the Group would receive or pay to terminate the contracts at the reporting dates, based on the prevailing currency prices and the relevant interest rates. Such measurement is classified within Level 2. | |||||||||
In addition to items that are measured at fair value on a recurring basis, there are also assets and liabilities that are measured at fair value on a nonrecurring basis. Assets and liabilities that are measured at fair value on a nonrecurring basis include certain long-lived assets including goodwill. As such, we have determined that each of these fair value measurements reside within Level 3 of the fair value hierarchy. | |||||||||
Cash and Cash Equivalents | |||||||||
The Company invests its excess cash in highly liquid short-term investments. The Company considers short-term investments that are purchased with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents consisted of cash and money market accounts at December 31, 2014 and 2013. | |||||||||
Short-term Deposits | |||||||||
Short-term deposits are deposits with original maturities of more than three months but less than one year. Short-term deposits are presented at their costs including accrued interest. | |||||||||
Accounts Receivable | |||||||||
The majority of the Company's accounts receivable (other than LCA) are due from consumers, distributors (domestic and international), physicians and other entities in the medical field. Accounts receivable are most often due within 30 to 90 days and are stated at amounts due from customers net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms are considered past due. The Company determines its allowance for doubtful accounts by considering a number of factors, including the length of time trade accounts receivable are past due, the Company's previous loss history, the customer's current ability to pay its obligation to the Company and available information about their credit risk, and the condition of the general economy and the industry as a whole. The Company writes off accounts receivable when they are considered uncollectible, and payments subsequently received on such receivables are credited to the allowance for doubtful accounts. The Company does not recognize interest accruing on accounts receivable past due. | |||||||||
Patient Receivables and Allowance for Doubtful Accounts | |||||||||
The Company, through its subsidiary LCA-Vision (which is presented as a discontinued operations), provides financing to some of its patients, including those who could not otherwise obtain third-party financing. The terms of the financing usually require the patient to pay an up-front fee which is intended to cover some or all of the variable costs, and then generally the remainder of the payments are automatically deducted from the patient's bank account over a period of 12 to 36 months. The Company has recorded an allowance for doubtful accounts as a best estimate of the amount of probable credit losses from the patient financing program. Each month, management reviews and adjusts the allowance based upon past experience with patient financing. | |||||||||
For patients that the Company internally finances, the Company charges interest at market rates. Finance and interest charges on patient receivables were $507 for the period ended December 31, 2014. | |||||||||
Inventories | |||||||||
Inventories are stated at the lower of cost or market. Cost is determined to be purchased cost for raw materials and the production cost (materials, labor and indirect manufacturing cost, including sub-contracted work components) for work-in-process and finished goods. For the Company's consumer and LHE products, cost is determined on the weighted-average method. For the pre-merged PhotoMedex's products, cost is determined on the first-in, first-out method. Throughout the laser manufacturing process, the related production costs are recorded within inventory. Work-in-process is immaterial, given the typically short manufacturing cycle, and therefore is disclosed in conjunction with raw materials. | |||||||||
The Company's equipment for the treatment of skin disorders (e.g. the XTRAC for psoriasis or vitiligo) will either (i) be placed in a physician's office and remain the property of the Company (at which date such equipment is transferred to property and equipment) or (ii) be sold to distributors or physicians directly. The cost to build a laser, whether for sale or for placement, is accumulated in inventory. | |||||||||
Reserves for slow moving and obsolete inventories are provided based on historical experience and product demand. Management evaluates the adequacy of these reserves periodically based on forecasted sales and market trend. | |||||||||
Property, Equipment and Depreciation | |||||||||
Property and equipment are recorded at cost, net of accumulated depreciation. Excimer lasers-in-service are depreciated on a straight-line basis over the estimated useful life of five years. For other property and equipment, depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, primarily three to seven years for computer hardware and software, furniture and fixtures, and machinery and equipment. Leasehold improvements are amortized over the lesser of the useful lives or lease terms. Expenditures for major renewals and betterments to property and equipment are capitalized, while expenditures for maintenance and repairs are charged as an expense as incurred. Upon retirement or disposition, the applicable property amounts are deducted from the accounts and any gain or loss is recorded in the consolidated statements of comprehensive (loss) income. Useful lives are determined based upon an estimate of either physical or economic obsolescence or both. | |||||||||
Management evaluates the realizability of property and equipment based on estimates of undiscounted future cash flows over the remaining useful life of the asset. If the amount of such estimated undiscounted future cash flows is less than the net book value of the asset, the asset is written down to fair value. As of December 31, 2014, no such write-down was required (see Impairment of Long-Lived Assetsand Intangibles). | |||||||||
Patent Costs and Licensed Technologies | |||||||||
Costs incurred to obtain or defend patents and licensed technologies are capitalized and amortized over the shorter of the remaining estimated useful lives or eight to 12 years. Core and product technology was also recorded in connection with the reverse acquisition on December 13, 2011 and is being amortized on a straight-line basis over ten years for core technology and five years for product technology. (See Note 6, Patent and Licensed Technologies). | |||||||||
Management evaluates the recoverability of intangible assets based on estimates of undiscounted future cash flows over the remaining useful life of the asset. If the amount of such estimated undiscounted future cash flows is less than the net book value of the asset, the asset is written down to fair value. As of December 31, 2014, no such write-down was required. (See Impairment of Long-Lived Assets and Intangibles). | |||||||||
Other Intangible Assets | |||||||||
Other intangible assets were recorded in connection with the reverse acquisition on December 13, 2011 and in connection with the acquisition of LCA. The assets which were determined to have definite useful lives are being amortized on a straight-line basis over ten years. Such assets primarily include customer relationships and trademarks. (See Note 7, Goodwill and Other Intangible Assets). | |||||||||
Management evaluates the recoverability of such other intangible assets based on estimates of undiscounted future cash flows over the remaining useful life of the asset. If the amount of such estimated undiscounted future cash flows is less than the net book value of the asset, the asset is written down to fair value. As of December 31, 2014 no such write-down was required. (See Impairment of Long-Lived Assets and Intangibles). | |||||||||
As of December 31, 2014, the indefinite life intangible is classified among the assets held for sale. | |||||||||
Accounting for the Impairment of Goodwill | |||||||||
The Company evaluates the carrying value of goodwill annually at the end of the calendar year and also between annual evaluations if events occur or circumstances change that would more likely than not reduce the fair value of the reporting unit to which goodwill was allocated to below its carrying amount. Such circumstances could include, but are not limited to: (1) a significant adverse change in legal factors or in business climate, (2) unanticipated competition, or (3) an adverse action or assessment by a regulator. Goodwill impairment testing involves a two-step process. Step 1 compares the fair value of the Group's reporting units to which goodwill was allocated to their carrying values. If the fair value of the reporting unit exceeds its carrying value, no further analysis is necessary. The reporting unit fair value is based upon consideration of various valuation methodologies, including guideline transaction multiples, multiples of current earnings, and projected future cash flows discounted at rates commensurate with the risk involved. If the carrying amount of the reporting unit exceeds its fair value, Step 2 must be completed to quantify the amount of impairment. Step 2 calculates the implied fair value of goodwill by deducting the fair value of all tangible and intangible assets, excluding goodwill, of the reporting unit, from the fair value of the reporting unit as determined in Step 1. The implied fair value of goodwill determined in this step is compared to the carrying value of goodwill. If the implied fair value of goodwill is less than the carrying value of goodwill, an impairment loss, equal to the difference, is recognized. See Note 2, regarding the impairment of goodwill which was allocated to LCA. | |||||||||
Accrued Enhancement Expense | |||||||||
The Company, through its subsidiary LCA-Vision (which is presented as a discontinued operations), includes participation in its LasikPlus Advantage Plan® (acuity program) in the base surgical price for substantially all of its patients. Under the acuity program, if determined to be medically appropriate, the Company provides post-surgical enhancements free of charge should the patient not achieve the desired visual correction during the initial procedure. Under this pricing structure, the Company accounts for the acuity program similar to a warranty obligation. Accordingly, the Company accrues the costs expected to be incurred to satisfy the obligation as a liability and cost of revenue at the point of sale given its ability to estimate reasonably such costs based on historical trends and the satisfaction of all other revenue recognition criteria. | |||||||||
This estimate is reviewed throughout the year with consideration to factors such as procedure cost and historical procedure volume when determining the appropriateness of the recorded balance. | |||||||||
Accrued Warranty Costs | |||||||||
The Company offers a standard warranty on product sales generally for a one to two-year period. In the case of domestic sales of XTRAC lasers, however, the Company has offered longer warranty periods, ranging from three to four years, in order to meet competition or meet customer demands. The Company provides for the expected cost of estimated future warranty claims on the date the product is sold. Total accrued warranty is included in other accrued liabilities on the balance sheet. The activity in the warranty accrual during the years ended December 31, 2014 and 2013 is summarized as follows: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Accrual at beginning of year | $ | 1,151 | $ | 1,440 | |||||
Additions charged to warranty expense | 808 | 1,206 | |||||||
Expiring warranties | (341 | ) | (410 | ) | |||||
Claims satisfied | (857 | ) | (1,085 | ) | |||||
Total | 761 | 1,151 | |||||||
Less: current portion | (665 | ) | (1,094 | ) | |||||
Long term accrued warranty | $ | 96 | $ | 57 | |||||
For extended warranty on the consumer products, see Revenue Recognition below. | |||||||||
Insurance Reserves | |||||||||
The Company, through its subsidiary LCA-Vision (which is presented as a discontinued operations), maintains a captive insurance company to provide professional liability insurance coverage for claims brought against the Company and its optometrists. In addition, the captive insurance company's charter allows it to provide professional liability insurance for the Company's ophthalmologists, none of whom are currently insured by the captive. The Company uses the captive insurance company for both primary insurance and excess liability coverage. A number of claims are now pending with the captive insurance company. Since the captive insurance company is wholly-owned enterprise, it is included in the Company's consolidated financial statements. As of December 31, 2014, the insurance reserves were $6,044, which represented an actuarially determined estimate of future costs associated with claims filed as well as claims incurred but not yet reported. The actuaries determine loss reserves by comparing the Company's historical claim experience to comparable insurance industry experience. | |||||||||
Revenue Recognition | |||||||||
The Company recognizes revenues from the product sales when the following four criteria have been met: (i) the product has been delivered and the Company has no significant remaining obligations; (ii) persuasive evidence of an arrangement exists; (iii) the price to the buyer is fixed or determinable; and (iv) collection is reasonably assured. Revenues from product sales are recorded net of provisions for estimated chargebacks, rebates, expected returns and cash discounts. | |||||||||
The Company ships most of its products FOB shipping point, although from time to time certain customers, for example governmental customers, will be granted FOB destination terms. Among the factors the Company takes into account when determining the proper time at which to recognize revenue are (i) when title to the goods transfers and (ii) when the risk of loss transfers. Shipments to distributors or physicians that do not fully satisfy the collection criteria are recognized when invoiced amounts are fully paid or fully assured and included in deferred revenues until that time. | |||||||||
For revenue arrangements with multiple deliverables within a single, contractually binding arrangements (usually sales of products with separately priced extended warranty), each element of the contract is accounted for as a separate unit of accounting when it provides the customer value on a stand-alone basis and there is objective evidence of the fair value of the related unit. | |||||||||
With respect to sales arrangements under which the buyer has a right to return the related product, revenue is recognized only if all the following conditions are met: the price is fixed or determinable at the date of sale; the buyer has paid, or is obligated to pay and the obligation is not contingent on resale of the product; the buyer's obligation would not be changed in the event of theft or physical destruction or damage of the product; the buyer has economic substance; the Company does not have significant obligations for future performance to directly bring about resale of the product by the buyer; and the amount of future returns can be reasonably estimated. | |||||||||
The Company provides a provision for product returns based on the experience with historical sales returns, in accordance with ASC Topic 605-15 with respect to sales of product when a right of return exists. Reported revenues are shown net of the returns provision. Such allowance for sales returns is included in Other Accrued Liabilities. (See Note 9). | |||||||||
Deferred revenue includes amounts received with respect to extended warranty maintenance, repairs and other billable services and amounts not yet recognized as revenues. Revenues with respect to such activities are deferred and recognized on a straight-line basis over the duration of the warranty period, the service period or when service is provided, as applicable to each service. | |||||||||
The Company has two distribution channels for its phototherapy treatment equipment. The Company either (i) sells its lasers through a distributor or directly to a physician or (ii) places its lasers in a physician's office (at no charge to the physician) and generally charges the physician a fee for an agreed upon number of treatments. In some cases, the Company and the customer stipulate to a quarterly or other periodic target of procedures to be performed, and accordingly revenue is recognized ratably over the period. | |||||||||
When the Company places a laser in a physician's office, it generally recognizes service revenue based on the number of patient treatments performed, or purchased under a periodic commitment, by the physician. Amounts collected with respect to treatments to be performed through laser-access codes that are sold to physicians free of a periodic commitment, but not yet used, are deferred and recognized as a liability until the physician performs the treatment. Unused treatments remain an obligation of the Company because the treatments can only be performed on Company-owned equipment. Once the treatments are performed, this obligation has been satisfied. | |||||||||
The Company defers substantially all revenue from sales of treatment codes ordered by and performed to its customers within the last two weeks of the period in determining the amount of treatments performed by its physician-customers. Management believes this approach closely approximates the actual amount of unused treatments that existed at the end of a period. | |||||||||
Shipping and Handling Costs | |||||||||
Shipping and handling fees billed to customers are reflected as revenues while the related shipping and handling costs are included in selling and marketing expense. To date, shipping and handling costs have not been material. | |||||||||
Product Development Costs | |||||||||
Costs of research, new product development and product redesign are charged to expense as incurred in engineering and product development. | |||||||||
Advertising Costs | |||||||||
Advertising costs are charged to expenses as incurred. | |||||||||
Advertising expenses amounted to approximately $62,197, $71,992 and $60,651 for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||||||
Derivatives | |||||||||
The Company applies the provisions of Accounting Standards Codification ("ASC") Topic 815, Derivatives and Hedging. In accordance with ASC Topic 815, all the derivative financial instruments are recognized as either financial assets or financial liabilities on the balance sheet at fair value. The accounting for changes in the fair value of a derivative financial instrument depends on whether it has been designated and qualifies as part of a hedging relationship and further, on the type of hedging relationship. For derivative financial instruments that are designated and qualify as hedging instruments, a company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, cash flow hedge or a hedge of a net investment in a foreign operation. | |||||||||
From time to time the Company carries out transactions involving foreign exchange derivative financial instruments (mainly forward exchange contracts) which are expected to be paid with respect to forecasted expenses of the Israeli subsidiary (Radiancy) denominated in Israeli local currency (NIS) which is different than its functional currency. | |||||||||
Such derivatives were not designated as hedging instruments, and accordingly they were recognized in the balance sheet at their fair value, with changes in the fair value carried to the Statement of Comprehensive (Loss) Income and included in interest and other financing income (expenses), net. | |||||||||
At December 31, 2014, the balance of such derivative instruments amounted to approximately $726 in liabilities and approximately $689 were recognized as financing loss in the Statement of Comprehensive (Loss) Income during the year ended that date. At December 31, 2013, the balance of such derivative instruments amounted to approximately $255 in assets and approximately $699 were recognized as financing income in the Statement of Comprehensive (Loss) Income during the year ended that date. | |||||||||
The notional amounts of foreign currency derivatives as of December 31, 2014 consist of forward transactions for the exchange of $11,000 into NIS and $6,725 as of December 31, 2013. | |||||||||
Income Taxes | |||||||||
The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured using enacted tax rates and laws that are expected to be in effect when the differences reverse. Any resulting net deferred tax assets are evaluated for recoverability and, accordingly, a valuation allowance is provided when it is more likely than not that all or some portion of the deferred tax asset will not be realized. | |||||||||
The Company may incur an additional tax liability in the event of an intercompany dividend distribution or a deemed dividend distribution under the U.S. income tax law and regulations. Prior to 2014, it was the Company's policy not to cause a distribution of dividends which would generate an additional tax liability to the Company. During 2014, the Company borrowed funds from its subsidiary in Israel. These borrowings resulted in a large deemed distribution taxable in the U.S. Furthermore, Management can no longer represent that the earnings of its non U.S. subsidiaries will remain permanently invested outside the U.S. Therefore, in 2014, the Company has provided deferred taxes on the undistributed earnings of its non U.S. subsidiaries. Taxes, which would apply in the event of disposal of investments in subsidiaries, have not been taken into account in computing the deferred taxes, as it is the Company's policy to hold these investments, not to dispose of them. | |||||||||
The Company accounts for uncertain tax positions in accordance with an amendment to ASC Topic 740-10, Income Taxes (Accounting for Uncertainty in Income Taxes), which clarified the accounting for uncertainty in tax positions. This amendment provides that the tax effects from an uncertain tax position can be recognized in the financial statements only if the position is "more-likely-than-not" to be sustained were it to be challenged by a taxing authority. The assessment of the tax position is based solely on the technical merits of the position, without regard the likelihood that the tax position may be challenged. If an uncertain tax position meets the "more-likely-than-not" threshold, the largest amount of tax benefit that is more than 50% likely to be recognized upon ultimate settlement with the taxing authority is recorded. | |||||||||
In the year ended December 31, 2014, the Company determined that the liability for unrecognized tax benefits could suitably be extinguished by application of net operating loss carryforwards and carrybacks, with any residual impact arising as a liability in 2014 that has been duly provided for. | |||||||||
Concentration of credit risks | |||||||||
Financial instruments which subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, derivative (assets), accounts receivable and short-term bank deposits. The carrying amounts of these instruments approximate fair value due to their short-term nature. The Company deposits cash and cash equivalents and short term deposits in major financial institutions in the US, UK, Brazil and in Israel. The Company performs periodic evaluations of the relative credit standing of these institutions. The Company is of the opinion that the credit risk in respect of these balances is immaterial. In addition, the Company performs an ongoing credit evaluation and establishes an allowance for doubtful accounts based upon factors surrounding the credit risk of customers (see also Accounts receivable above). | |||||||||
Most of the Company's sales are generated in North America and Asia Pacific, to a large number of customers. Management periodically evaluates the collectability of the trade receivables to determine the amounts that are doubtful of collection and determine a proper allowance for doubtful accounts. Accordingly, the Company's trade receivables do not represent a substantial concentration of credit risk. | |||||||||
Contingencies | |||||||||
The Company and its subsidiaries are involved in certain legal proceedings that arise from time to time in the ordinary course of its business. Except for income tax contingencies, the Company records accruals for contingencies to the extent that the management concludes that the occurrence is probable and that the related amounts of loss can be reasonably estimated. Legal expenses associated with the contingency are expensed as incurred. | |||||||||
Earnings (Loss) Per Share | |||||||||
The Company computes earnings (net loss) per share in accordance with ASC Topic. 260, Earnings per share. Basic earnings (loss) per share are computed by dividing net income by the weighted-average number of common shares outstanding during the period, net of the weighted average number of treasury shares. Diluted earnings (loss) per common share are computed similar to basic earnings per share, except that the denominator is increased to include the number of additional potential common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Potential common shares are excluded from the computation for a period in which a net loss is reported or if their effect is anti-dilutive. The Company's potential common shares consist of stock options, warrants and restricted stock awards issued under the Company's stock incentive plans and their potential dilutive effect is considered using the treasury method. | |||||||||
Basic and diluted earnings per common share were calculated using the following weighted average shares outstanding for the years ended December 31, 2014, 2013 and 2012: | |||||||||
December 31, | |||||||||
2014 | 2013 | 2012 | |||||||
Weighted average number of common and common equivalent shares outstanding: | |||||||||
Basic number of common shares outstanding | 18,940,355 | 20,454,970 | 20,355,520 | ||||||
Dilutive effect of stock options and warrants | - | 202,270 | 408,834 | ||||||
Diluted number of common and common stock equivalent shares outstanding | 18,940,355 | 20,657,240 | 20,764,354 | ||||||
Diluted earnings (loss) per share for each of the years ended December 31, 2014, 2013 and 2012 exclude the impact of common stock options, warrants and unvested restricted stock totaling 2,540,733, 2,172,745 and 1,920,442 shares, respectively, as the effect of their inclusion would be anti-dilutive. | |||||||||
Impairment of Long-Lived Assets and Intangibles | |||||||||
Long-lived assets, such as property and equipment, and definite-lived intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the fair value of the asset. If the carrying amount of an asset exceeds the fair value, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. As of December 31, 2014, (other than the measurement of LCA net assets based on it estimated fair value less cost to sell- see Note 2) no such impairment exists. Assets to be disposed of are separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated. The assets and liabilities of a disposed group classified as discontinued operations are presented separately in the appropriate asset and liability sections of the balance sheet. | |||||||||
Indefinite-life intangible assets are tested for impairment, on an annual basis or more often, when triggering events indicate that it is more likely than not that the asset is impaired, by comparing the fair value of the asset with its carrying amount. If the carrying amount of the intangible asset exceeds its fair value, an impairment loss is recognized in the amount of that excess. Subsequent reversal of a previously recognized impairment loss is prohibited. | |||||||||
Stock-Based Compensation | |||||||||
The Company accounts for stock-based compensation in accordance with ASC Topic 718, Compensation – Stock Compensation. Under the fair value recognition provision, of this statement, share-based compensation cost is measured at the grant date based on the fair value of the award that is ultimately expected to vest and is recognized as operating expense over the applicable vesting period of the stock award using the graded vesting method. | |||||||||
Treasury Stock and Repurchase of Common Stock | |||||||||
Shares held by the Company are presented as a reduction of equity, at their cost to the Company as treasury stock, until such shares are retired and removed from the accounts. | |||||||||
Adoption of New Accounting Standards | |||||||||
Effective January 1, 2014, the Company adopted Accounting Standard Update 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force) ("ASU 2013-11"). | |||||||||
The amendments in ASU 2013-11 state that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows: To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be presented net of deferred tax assets. | |||||||||
ASU 2013-11 applies to all entities that have unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. For public companies the amendments in this ASU became effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The amendments were applied prospectively to all unrecognized tax benefits that existed at the effective date. | |||||||||
The adoption of the standard did not have a material impact on the Company's consolidated results of operations and financial condition. | |||||||||
Effective January 1, 2014, the Company adopted Accounting Standards Update 2013-5, Foreign Currency Matters (Topic 830) Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity ("ASU 2013-5"). | |||||||||
ASU 2013-5 clarifies that, when a reporting entity (parent) ceases to have a controlling financial interest in a subsidiary or group of assets that is a business (other than a sale of in-substance real estate or conveyance of oil and gas mineral rights) within a foreign entity, the parent is required to apply the guidance in Subtopic 830-30 to release any related cumulative translation adjustment into net income. Accordingly, the cumulative translation adjustment should be released into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. ASU 2013-5 also clarifies that if the business combination achieved in stages relates to a previously held equity method investment (step-acquisition) that is a foreign entity, the amount of accumulated other comprehensive income that is reclassified and included in the calculation of gain or loss shall include any foreign currency translation adjustment related to that previously held investment. | |||||||||
For public companies, the amendments in this Update became effective prospectively for fiscal years (and interim reporting periods within those years) beginning after December 15, 2013. In accordance with the transition requirements, the amendments were applied prospectively to derecognition events occurring after the effective date. Prior periods are not required be adjusted. | |||||||||
The adoption of the standard did not have a material impact on the Company's consolidated results of operations and financial condition. | |||||||||
Recently Issued Accounting Standards | |||||||||
In April 2014, the FASB issued Accounting Standard Update 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity ("ASU 2014-08"). | |||||||||
The amendments in ASU 2014-08 change the criteria for reporting discontinued operations while enhancing disclosures in this area. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. Those strategic shifts should have a major effect on the organization's operations and financial results. In addition, the new guidance requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. | |||||||||
The amendments in ASU 2014-08 are effective in the first quarter of 2015 for public companies with calendar year ends. Early adoption is permitted. | |||||||||
The adoption of ASU 2014-08 is not expected to have a material impact on the Company's consolidated results of operations and financial condition. | |||||||||
In May 2014, The FASB issued Accounting Standard Update 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"). | |||||||||
ASU 2014-09 outlines a single comprehensive model to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASU 2014-09 also requires entities to disclose sufficient information, both quantitative and qualitative, to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. | |||||||||
An entity should apply the amendments in this ASU using one of the following two methods: 1. Retrospectively to each prior reporting period presented with a possibility to elect certain practical expedients, or, 2. Retrospectively with the cumulative effect of initially applying ASU 2014-09 recognized at the date of initial application. If an entity elects the latter transition method, it also should provide certain additional disclosures. | |||||||||
For a public entity, the amendments in ASU 2014-09 are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period (the first quarter of fiscal year 2017 for the Company). Early application is not permitted. The Company is in the process of assessing the impact, if any, of ASU 2014-09 on its consolidated financial statements. | |||||||||
In August 2014, the FASB issued Accounting Standards Update 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern ("ASU 2014-15"). ASU 2014-15 provide guidance on management's responsibility in evaluating whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable). ASU 2014-15 also provide guidance related to the required disclosures as a result of management evaluation. | |||||||||
The amendments in ASU 2014-15 are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. |
Discontinued_Operations
Discontinued Operations | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Discontinued Operations [Abstract] | |||||
Discontinued Operations | Note 2 | ||||
Discontinued Operations: | |||||
LCA is a provider of fixed-site laser vision corrections services at its LasikPlus® vision centers. The vision centers provide the staff, facilities, equipment and support services for performing laser vision correction that employs advanced laser technologies to help correct nearsightedness, farsightedness and astigmatism. The vision centers are supported by independent ophthalmologists and credentialed optometrists, as well as other healthcare professionals. Substantially all of LCA's revenues are derived from the delivery of laser vision correction procedures performed in the vision centers. After preliminary investigations and discussions, the Board of Directors of the Company, with the aid of its investment banker, had reached a formal decision during December 2014 to enter into, substantive, confidential discussions with potential third-party buyers and began to develop plans for implementing a disposal of the assets and operations of the business. The Company accordingly classified this former segment as held for sale in accordance and discontinued operations with ASC Topic 360. On February 2, 2015, the Company closed on sale transaction of 100% of the shares of LCA for $40 million in cash. Excluding estimated working capital adjustments and direct expenses (professional fees to third parties), PhotoMedex realized net proceeds of approximately $36.5 million which amount is considered as the fair value less cost to sell of LCA as of December 31, 2014. The sale was effective January 31, 2014. No income tax benefit was recognized by the Company from the loss on the sale of discontinued operations. | |||||
The accompanying consolidated financial statements reflect the operating results and balance sheet items of the discontinued operations separately from continuing operations. The Company recognized an estimated loss of $44,598 on the sale of the discontinued operations in the year ended December 31, 2014, which included a decrease in the implied fair value of goodwill, related to LCA, of $43,091. The remaining loss of $1,507 represents the difference between the adjusted net purchase price and the carrying value of the disposal group. The impairment amount is categorized as level 3 measurements. | |||||
Revenues from LCA, reported as discontinued operations, for the year ended December 31, 2014 was $47,198. Loss from LCA, reported as discontinued operations, for the year ended December 31, 2014 was $15,155, which includes tax expense of $5,496 and interest expense of $2,065 related to the portion of the credit facility that was required to be paid as a result of the sale. | |||||
The following is a summary of assets and liabilities held for sale in the consolidated balance sheet as of December 31, 2014: | |||||
31-Dec-14 | |||||
Assets: | |||||
Cash and cash equivalents | $ | 4,514 | |||
Accounts receivable | 2,759 | ||||
Inventories | 119 | ||||
Deferred tax assets | 1,930 | ||||
Other current assets | 2,492 | ||||
Property & Equipment, net | 14,519 | ||||
Goodwill, net | 6,491 | ||||
Other intangible assets, net | 38,331 | ||||
Other assets | 1,207 | ||||
Assets held for sale | 72,362 | ||||
Less: Impairment | (1,507 | ) | |||
Assets held for sale, net | $ | 70,855 | |||
Liabilities: | |||||
Accounts payable | $ | 5,518 | |||
Other accrued liabilities | 5,933 | ||||
Deferred revenues | 97 | ||||
Long term debt: | 1,080 | ||||
Other liabilities | 6,870 | ||||
Deferred tax liability | 14,999 | ||||
Liabilities held for sale | 34,497 | ||||
Total net assets of discontinued operations | $ | 36,358 |
Acquisition
Acquisition | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Acquisition [Abstract] | |||||
Acquisition | Note 3 | ||||
Acquisition: | |||||
Acquisition of LCA-Vision Inc.: | |||||
On May 12, 2014, PhotoMedex Inc., completed the acquisition of 100% of the shares of LCA-Vision, a previously publicly-traded Delaware corporation. | |||||
LCA is a provider of fixed-site laser vision corrections services at its LasikPlus® vision centers. The vision centers provide the staff, facilities, equipment and support services for performing laser vision correction that employs advanced laser technologies to help correct nearsightedness, farsightedness and astigmatism. The vision centers are supported by independent ophthalmologists and credentialed optometrists, as well as other healthcare professionals. Substantially all of LCA's revenues are derived from the delivery of laser vision correction procedures performed in the vision centers. | |||||
The purchase price of LCA-Vision was $106,552 in aggregate consideration, paid in cash (including the full use of the credit facility), consisting of: | |||||
Fair value LCA-Vision stock (A) | $ | 103,896 | |||
Fair value of LCA-Vision restricted stock units, including payroll taxes (B) | 2,656 | ||||
Total purchase price | $ | 106,552 | |||
A. | Based on 19,347,554 outstanding shares of LCA-Vision common stock at May 12, 2014. | ||||
B. | Based on 476,436 outstanding or deemed to be outstanding restricted stock units of LCA-Vision common stock at May 12, 2014. | ||||
The fair value of the assets acquired and liabilities assumed were based on management estimates and values derived from an outside independent appraisal. The Company expected that the allocation would be finalized within twelve months after the merger. However, LCA was sold in January 2015 and it is presented as a discontinued operations, see Note 2. Accordingly management has determined to retain the provisional amounts. Based on the purchase price allocation, the following table summarizes the provisional fair value amounts of the assets acquired and liabilities assumed at the date of acquisition: | |||||
Cash and cash equivalents | $ | 29,042 | |||
Current assets, excluding cash and cash equivalents | 6,114 | ||||
Deferred tax asset, current | 1,124 | ||||
Property, plant and equipment | 17,269 | ||||
Identifiable intangible assets | 39,050 | ||||
Other assets | 1,518 | ||||
Total assets acquired at fair value | 94,117 | ||||
Current liabilities | (19,009 | ) | |||
Long-term debt | (1,603 | ) | |||
Deferred tax liability, long-term | (9,138 | ) | |||
Other long-term liabilities | (7,397 | ) | |||
Total liabilities assumed | (37,147 | ) | |||
Net assets acquired | $ | 56,970 | |||
The purchase price exceeded the fair value of the net assets acquired by $49,582, which was recorded as goodwill. The goodwill was recognized at that time as a new reportable segment and allocated to the activities of LCA. | |||||
The summarized unaudited pro-forma results for the years ended December 31, 2014 and 2013 are not provided as required under ASC Topic 805 since LCA is presented as a discontinued operation for the periods presented. |
Inventories
Inventories | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Inventories [Abstract] | |||||||||
Inventories | Note 4 | ||||||||
Inventories: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Raw materials and work-in-process | $ | 7,483 | $ | 12,631 | |||||
Finished goods | 11,897 | 14,916 | |||||||
Total inventories | $ | 19,380 | $ | 27,547 | |||||
Work-in-process is immaterial given the typically short manufacturing cycle, and therefore is disclosed in conjunction with raw materials. |
Property_and_Equipment
Property and Equipment | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property and Equipment [Abstract] | |||||||||
Property and Equipment | Note 5 | ||||||||
Property and Equipment: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Lasers-in-service | $ | 18,974 | $ | 12,599 | |||||
Equipment, computer hardware and software | 4,870 | 4,730 | |||||||
Furniture and fixtures | 767 | 705 | |||||||
Leasehold improvements | 481 | 534 | |||||||
25,092 | 18,568 | ||||||||
Accumulated depreciation and amortization | (11,290 | ) | (8,079 | ) | |||||
Total property and equipment, net | $ | 13,802 | $ | 10,489 | |||||
Related depreciation and amortization expense was $3,657 in 2014, $2,875 in 2013 and $2,367 in 2012. |
Patents_and_Licensed_Technolog
Patents and Licensed Technologies, net | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Patents and Licensed Technologies, net [Abstract] | |||||||||
Patents and Licensed Technologies, net | Note 6 | ||||||||
Patents and Licensed Technologies, net: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Gross Amount beginning of period | $ | 15,648 | $ | 15,411 | |||||
Additions | 168 | 171 | |||||||
Translation differences | (190 | ) | 66 | ||||||
Gross Amount end of period | 15,626 | 15,648 | |||||||
Accumulated amortization | (6,815 | ) | (4,816 | ) | |||||
Net Book Value | $ | 8,811 | $ | 10,832 | |||||
Related amortization expense was $2,055, $2,043 and $2,049 for the years ended December 31, 2014, 2013 and 2012, respectively. An amount of $13,500, included in gross amount related to Patents represents product and core technologies recorded as part of the purchase price allocation done in connection with the reverse acquisition of the Pre-merged PhotoMedex. | |||||||||
Estimated amortization expense for amortizable patents and licensed technologies assets for the next five years is as follows: | |||||||||
2015 | $ | 2,056 | |||||||
2016 | 2,019 | ||||||||
2017 | 903 | ||||||||
2018 | 906 | ||||||||
2019 | 892 | ||||||||
Thereafter | 2,035 | ||||||||
Total | $ | 8,811 |
Goodwill_and_Other_Intangible_
Goodwill and Other Intangible Assets | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Goodwill and Other Intangible Assets [Abstract] | |||||||||||||||||||||||||
Goodwill and Other Intangible Assets | Note 7 | ||||||||||||||||||||||||
Goodwill and Other Intangible Assets: | |||||||||||||||||||||||||
As part of the purchase price allocation for the reverse acquisition, the Company recorded goodwill in the amount of $24,005 and definite-lived intangibles in the amount of $12,000. Goodwill reflects the value or premium of the acquisition price in excess of the fair values assigned to specific tangible and intangible assets. Goodwill has an indefinite useful life and therefore is not amortized as an expense, but is reviewed annually for impairment of its fair value to the Company. The purchase price intrinsically recognizes the benefits of the broadened depth of the management team and the addition of a sizeable direct sales force creating greater access to the physician community with branded products and technologies. Furthermore, the purchase price paid by Radiancy, Inc., a private company includes, among other things, other benefits such as the intrinsic value of being a Nasdaq-listed issuer post merger and now having access to capital markets and stockholder liquidity. | |||||||||||||||||||||||||
Balance at January 1, 2014 | $ | 24,930 | |||||||||||||||||||||||
Additions to goodwill | - | ||||||||||||||||||||||||
Translation differences | (882 | ) | |||||||||||||||||||||||
Balance at December 31, 2014 | $ | 24,048 | |||||||||||||||||||||||
The Company has no accumulated impairment losses of goodwill related to the continuing operations as of December 31, 2014. See Note 2 regarding impairment of goodwill allocated to the discontinued operations. | |||||||||||||||||||||||||
The goodwill was allocated among the reportable segments as of December 31, 2014 in accordance with the provisions of ASC Topic 350-20 Intangibles-Goodwill and consisted of the following: | |||||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||
Consumer segment | $ | 19,968 | |||||||||||||||||||||||
Physician Recurring segment | 4,080 | ||||||||||||||||||||||||
Total goodwill | $ | 24,048 | |||||||||||||||||||||||
Set forth below is a detailed listing of other definite-lived intangible assets: | |||||||||||||||||||||||||
31-Dec-14 | 31-Dec-13 | ||||||||||||||||||||||||
Trademarks | Customer Relationships | Total | Trademarks | Customer Relationships | Total | ||||||||||||||||||||
Gross Amount beginning of period | $ | 5,772 | $ | 6,417 | $ | 12,189 | $ | 5,744 | $ | 6,372 | $ | 12,116 | |||||||||||||
Translation differences | (80 | ) | (128 | ) | (208 | ) | 28 | 45 | 73 | ||||||||||||||||
Gross Amount end of period | 5,692 | 6,289 | 11,981 | 5,772 | 6,417 | 12,189 | |||||||||||||||||||
Accumulated amortization | (1,731 | ) | (1,913 | ) | (3,644 | ) | (1,178 | ) | (1,310 | ) | (2,488 | ) | |||||||||||||
Net Book Value | $ | 3,961 | $ | 4,376 | $ | 8,337 | $ | 4,594 | $ | 5,107 | $ | 9,701 | |||||||||||||
Related amortization expense was $1,200, $1,200 and $1,212 for the years ended December 31, 2014, 2013 and 2012. Customer Relationships embody the value to the Company of relationships that Pre-merged PhotoMedex had formed with its customers. Tradename includes the names and various other trademarks associated with Pre-merged PhotoMedex products (e.g. "XTRAC", "Neova" "Omnilux" and "Lumiere"). | |||||||||||||||||||||||||
Estimated amortization expense for the above amortizable intangible assets for the next five years is as follows: | |||||||||||||||||||||||||
2015 | $ | 1,200 | |||||||||||||||||||||||
2016 | 1,200 | ||||||||||||||||||||||||
2017 | 1,200 | ||||||||||||||||||||||||
2018 | 1,200 | ||||||||||||||||||||||||
2019 | 1,200 | ||||||||||||||||||||||||
Thereafter | 2,337 | ||||||||||||||||||||||||
Total | $ | 8,337 |
Accrued_Compensation_and_relat
Accrued Compensation and related expenses | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accrued Compensation and related expenses [Abstract] | |||||||||
Accrued Compensation and related expenses | Note 8 | ||||||||
Accrued Compensation and related expenses: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Accrued payroll and related taxes | $ | 513 | $ | 707 | |||||
Accrued vacation | 211 | 290 | |||||||
Accrued commissions and bonuses | 1,898 | 2,233 | |||||||
Total accrued compensation and related expense | $ | 2,622 | $ | 3,230 |
Other_Accrued_Liabilities
Other Accrued Liabilities | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Other Accrued Liabilities [Abstract] | |||||||||
Other Accrued Liabilities | Note 9 | ||||||||
Other Accrued Liabilities: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Accrued warranty, current, see Note 1 | $ | 665 | $ | 1,094 | |||||
Accrued taxes, including liability for unrecognized tax benefit, see Note 13 | 1,362 | 1,023 | |||||||
Accrued sales return (1) | 7,651 | 16,046 | |||||||
Other accrued liabilities | 3,344 | 3,869 | |||||||
Total other accrued liabilities | $ | 13,022 | $ | 22,032 | |||||
-1 | The activity in the sales returns liability account was as follows: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Balance at beginning of year | $ | 16,046 | $ | 11,901 | |||||
Additions that reduce net sales | 35,771 | 47,916 | |||||||
Actual returns | (44,166 | ) | (43,771 | ) | |||||
Balance at end of year | $ | 7,651 | $ | 16,046 |
Longterm_Debt
Long-term Debt | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Long-term Debt [Abstract] | |||||||||
Long-term Debt | Note 10 | ||||||||
Long-term Debt: | |||||||||
In the following table is a summary of the Company's long-term debt: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Senior-secured credit facilities | $ | 76,500 | $ | - | |||||
Term note | - | 10,000 | |||||||
Sub-total | 76,500 | 10,000 | |||||||
Less: current portion | 38,732 | 10,000 | |||||||
Long-term debt | $ | 37,768 | $ | - | |||||
Senior Secured Credit Facilities | |||||||||
On May 12, 2014, the Company entered into an $85 million senior secured credit facilities ("the Facilities") with JP Morgan Chase ("Chase") which included a $10 million revolving credit facility and a $75 million four-year term loan. The facilities were utilized to refinance the existing term debt with Chase, fund the acquisition of LCA and for working capital and other general corporate purposes. | |||||||||
Interest is determined at Eurodollar plus a margin between 3.25% and 4.50%. The margin is updated quarterly based on the then-current leverage ratio. The facilities are secured by a first priority security interest in and lien on all assets of the Company. All current and future subsidiaries are guarantors on the facilities. There are financial covenants including; a maximum leverage covenant and a minimum fixed charge covenant, which the Company must maintain. These covenants will be determined quarterly based on a rolling past four quarters of financial data. As of December 31, 2014, the Company continued to fail to meet both financial covenants and is in default of the credit facilities | |||||||||
On August 4, 2014, the Company received a notice of default and a reservation of rights from Chase and engaged a third-party independent advisor to assist the Company in negotiating a longer term solution to the defaults. The parties had entered into an initial Forbearance Agreement (the "Initial Forbearance Agreement") on August 25, 2014. On November 4, 2014, the Company entered into an Amended and Restated Forbearance Agreement (the "Amended Forbearance Agreement") with the lenders that are parties to the Credit Agreement and with Chase, as Administrative Agent for the Lenders. | |||||||||
Effective February 28, 2015, the Company entered into a Second Amended and Restated Forbearance Agreement (the "Second Amended Forbearance Agreement") with the lenders (the "Lenders") that are parties to the Credit Agreement dated May 12, 2014, and with JP Morgan Chase, as Administrative Agent for the Lenders. | |||||||||
Pursuant to the terms of the Second Amended Forbearance Agreement, the Lenders have agreed to forbear from exercising their rights and remedies with respect to the Specified Events of Default from August 25, 2014 until April 1, 2016, or earlier if an event of default occurs (the "Forbearance Period"). Chase and the Lenders agreed that the Company shall not be obligated to pay the principal amounts set forth in Section 2.08(b) of the Credit Agreement for any date identified therein during the period beginning on February 28, 2015 and ending on the end of the Forbearance Period (the "Effective Period"), and that any failure to do so shall not constitute a default or event of default. Instead, the Lenders and the Company agreed that the Company would make prepayments against the Term Loan of $250,000 on the first business day of each month during the Forbearance Period, which will be applied in direct order of maturity. The Company also agreed that, on or before the fifth calendar day of each month, the Company would pay against the Term Loan $125,000 to the extent that the cash-on-hand exceeds $5 million, and 100% of the cash-on-hand in excess of $7 million, also to be applied to the Term Loan in inverse order of maturity. | |||||||||
Under the provisions of the Second Amended Forbearance Agreement, the Company will not have to comply with certain financial covenants contained in Section 6.11 of the Credit Agreement for the Forbearance Period, and that any failure to do so shall not constitute a default or event of default. However, the Company will have to meet certain minimum EBITDA targets (as defined in the forbearance agreement) for the quarters ending March 31, 2015, June 30, 2015, September 30, 2015 and December 31, 2015. | |||||||||
Pursuant to the Second Amended Forbearance Agreement, all loans under the Facilities shall, beginning November 1, 2014, bear interest at the CB Floating Rate (as defined in the Credit Agreement) plus 4.00%. Additionally, following the occurrence and continuance of any default or event of default (other than a Specified Event of Default), the Company's obligations under the Facilities shall, at the option of Chase and the Lenders, bear interest at the rate of 2.00% plus the rate otherwise in effect. | |||||||||
The Company and its subsidiaries have also agreed not to pay in cash any compensation to the either the Company's Chief Executive Officer or President that is based on a percentage of sales or another metric other than those officer's base salary, perquisites and standard benefits provided to or on behalf of those executives under the terms of their employment agreements. Those payments may be accrued or deferred and paid in cash only after the repayment of the Facilities in full. | |||||||||
The Company has agreed to provide, on or before May 29, 2015, a strategic business plan for the overall direction of the Company's and its subsidiaries' businesses, including projected income statements, balance sheets, schedules of cash receipts and cash disbursements, payments and month-end balances, and detailed notes and assumptions, projected on a monthly basis through April 1, 2016. The Company has also agreed to provide quarterly updates to that plan by August 31, 2015, November 30, 2015 and February 29, 2016. | |||||||||
The Company continues to retain the services of both Getzler Henrich & Assoc. LLC, a third-party independent business advisor, as well as Canaccord Genuity, Inc., a banking and financial services company, and has also retained the services of Nomura Securities International, Inc., also a banking and financial services company. During the Forbearance Agreement, the Company and these advisors will continue to prepare and distribute offering memoranda and other marketing materials to prospective lenders with regard to a proposed credit facility for the Company, the proceeds of which would be in an amount sufficient to repay in full and in cash the Company's remaining obligations under the Facilities, and to explore other strategic alternatives. The closing of any such refinancing or alternative arrangement would occur no later than the end of the Forbearance Period. | |||||||||
The Company agreed to limit certain capital expenditures to $100,000 per quarter, except for those involving the Company's XTRAC® or VTRAC® medical devices, and will not make investments or acquire any other interests in affiliated companies except as agreed to by the Lenders. | |||||||||
As consideration for the Lender's entry into the Second Amended Forbearance Agreement, the Company has agreed to pay the Lenders certain forbearance fees (the "Forbearance Fees"), which are payable on the last business day of each of the specified months: for May and June 2015, $750,000 each month; for July through September 2015, $1,000,000 each month; for October through December 2015, $1,250,000 each month; and for January through March 2016, $1,500,000 each month. However, should the Company complete a capital transaction acceptable to the Lenders that reduces the then-outstanding principal balance of the Term Loan to less than $10 million and repays all Forbearance Fees accrued and unpaid to that date, the monthly Forbearance Fee for the remainder of the Forbearance Period shall be earned and accrued in an amount that is 50% of the amount specified for each of the remaining months. In addition, the $500,000 Forbearance Fee set forth in Section 4.10(b) of the Amended Forbearance Agreement remains due and payable to the Lenders on the earlier of the Expiration Date or the Termination Date of the Forbearance Period. All Forbearance Fees are considered earned and are included in the Obligations under the Credit Agreement. | |||||||||
The Second Amended Forbearance Agreement is also subject to customary covenants, including limitations on the incurrence of or payments on indebtedness to other persons or entities and requirements that the Company provide periodic financial information and information regarding the status of outstanding litigation involving the Company and its subsidiaries to the Lenders. | |||||||||
In addition, the unamortized related debt issue costs and debt discount of $2,358 have been expensed during the year ended December 31, 2014. | |||||||||
Term-Note Credit Facility | |||||||||
In December 2013, the Company, through its subsidiary, Radiancy, Inc., entered into a term-note facility with JP Morgan Chase ("Chase"). The facility had maximum principal amount of $15 million and was for a term of one year. As of December 31, 2013, the Company had total borrowings of $10 million under this facility. The stated interest rate for any draw under the credit facility was set as the greater of (i) prime rate, (ii) federal funds effective rate plus .5% or (iii) LIBOR plus 2.5%. Each draw has a repayment period of one year with principal due at maturity, although any draw may be paid early with penalty. This term-note was cancelled at the time the senior secured credit facilities were entered into. | |||||||||
The following table summarizes the future minimum payments that the Company expects to make for long-term debt: | |||||||||
2015 | $ | 38,732 | |||||||
2016 | 37,768 | ||||||||
$ | 76,500 |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Commitments and Contingencies [Abstract] | |||||
Commitments and Contingencies | Note 11 | ||||
Commitments and Contingencies: | |||||
Leases | |||||
The Company has entered into various non-cancelable operating lease agreements for real property and one minor operating lease for personal property. These arrangements expire at various dates through 2017. Rent expense was $4,708 (including $3,690 from LCA), $1,002 and $908 for the years ended December 31, 2014, 2013 and 2012, respectively. Not included in the table below is $17,916 related to LCA, which was sold as of January 31, 2015. The future annual minimum payments under these leases, relating to our continuing operations are as follows: | |||||
Year Ending December 31, | |||||
2015 | $ | 814 | |||
2016 | 472 | ||||
2017 | 176 | ||||
Thereafter | 366 | ||||
Total | $ | 1,828 | |||
Litigation | |||||
During the year ended December 31, 2013, Radiancy, Inc., a wholly-owned subsidiary of PhotoMedex, commenced legal action against Viatek Consumer Products Group, Inc., over Viatek's Pearl and Samba hair removal products which Radiancy believes infringe the intellectual property covering its no!no! hair removal devices. The first suit, which was filed in the United States Federal Court, Southern District of New York, includes claims against Viatek for patent infringement, trademark and trade dress infringement, and false and misleading advertising. A second suit against Viatek was filed in Canada, where the Pearl is offered on that country's The Shopping Channel, alleging trademark and trade dress infringement, and false and misleading advertising. Viatek's response contains a variety of counterclaims and affirmative defenses against both Radiancy and its parent company PhotoMedex, including, among other counts, claims regarding the invalidity of Radiancy's patents and antitrust allegations regarding Radiancy's conduct. | |||||
Radiancy, and PhotoMedex, had moved to dismiss PhotoMedex from the case, and to dismiss the counterclaims and affirmative defenses asserted by Viatek. On March 28, 2014, the Court granted the Company's motion and dismissed PhotoMedex from the lawsuit. The Court also dismissed certain counterclaims and affirmative defenses asserted by Viatek, including Viatek's counterclaims against Radiancy for antitrust, unfair competition, and tortious interference with business relationships and Viatek's affirmative defenses of unclean hands and inequitable conduct before the U.S. Patent and Trademark Office in procuring its patent. Radiancy also moved for sanctions against Viatek for failure to provide meaningful and timely responses to Radiancy's discovery requests; on April 1, 2014, the Court granted that motion. Viatek appealed both the sanctions ruling and the dismissal of Viatek's counterclaims and defenses from the case, as well as PhotoMedex's dismissal as a plaintiff; the Court has denied those appeals. The Court has appointed a Special Master to oversee discovery. A Markman hearing on the patents at issue was held on March 2, 2015. Viatek has requested an opportunity to supplement its patent invalidity contentions in the US case; Radiancy opposes that request. Radiancy has been granted permission by the US Court to supplement its earlier sanctions motion to include the legal fees and costs associated with preparing and prosecuting that motion. As of December 31, 2014, discovery and related court hearings continue in both the US and the Canadian cases. At this time, the amount of any loss, or range of loss, cannot be reasonably estimated as the case is still in the early stages of discovery to determine the validity of any claim or claims made by Viatek. Therefore, the Company has not recorded any reserve or contingent liability related to this particular legal matter. However, in the future, as the case progresses, the Company may be required to record a contingent liability or reserve for this matter. | |||||
On December 20, 2013, PhotoMedex, Inc. was served with a class action lawsuit filed in the United States District Court for the Eastern District of Pennsylvania against the Company and its two top executives, Dolev Rafaeli, Chief Executive Officer, and Dennis M. McGrath, President and Chief Financial Officer. The suit alleged various violations of the Federal securities laws between November 7, 2012 and November 14, 2013. A mediation on possible settlement of this action was held on November 10, 2014; the parties including the Company's insurance carrier have agreed on a possible settlement. The Company has paid its own legal fees up to the deductible cap on its insurance policy, and all amounts to be paid to plaintiffs and plaintiff's counsel will be paid by the carrier of the insurance policy. This settlement is subject to review and approval by the District Court, which has not yet rendered its opinion. | |||||
The Company was served on July 29, 2014 with an application to certify a class action, filed in Israel District Court for Tel Aviv against the Company and its two top executives, Dolev Rafaeli, Chief Executive Officer, and Dennis M. McGrath, President and Chief Financial Officer. The plaintiff's who initiated this complaint have agreed to be part of, and be bound by, the possible settlement reached in the United States District Court for the Eastern District of Pennsylvania against the Company and the same two top executives. | |||||
There were multiple class-action lawsuits filed in connection with PhotoMedex's proposed acquisition of LCA-Vision, Inc. All cases asserted claims against LCA-Vision, Inc., and a mix of other defendants, including LCA's chief executive officer and directors, PhotoMedex, and Gatorade Acquisition Corp., a wholly owned subsidiary of PhotoMedex. The complaints generally allege that the proposed acquisition undervalued LCA and deprived LCA's shareholders of the opportunity to participate in LCA's long-term financial prospects, that the "go shop" and "deal-protection" provisions of the Merger Agreement were designed to prevent LCA from soliciting or receiving competing offers, that LCA's Board breached its fiduciary duties and failed to maximize that company's stockholder value, and that LCA, PhotoMedex, and Gatorade aided and abetted the LCA defendants' alleged breaches of duty. The parties have reached a possible settlement in these suits, with the Company contributing less than $100,000 to the settlement, plus the payment of its legal fees, and the remainder of the settlement being covered by the insurance carriers. This settlement is subject to review and approval by the state court, which has not yet rendered its opinion. | |||||
On April 25, 2014, a class action lawsuit was filed in the United States District Court for the District of Columbia against the Company's subsidiary, Radiancy, Inc. and Dolev Rafaeli, Radiancy's President. The suit was filed by Jan Mouzon and twelve other customers residing in ten different states who purchased Radiancy's no!no! Hair products. It alleges various violations of state business and consumer protection codes including false and misleading advertising, unfair trade practices, and breach of express and implied warranties. The complaint seeks certification of the putative class, or, alternatively, certification as subclasses of plaintiffs residing in those specific states. The complaint also seeks an unspecified amount of monetary damages, pre-and post-judgment interest and attorneys' fees, expert witness fees and other costs. Dr. Rafaeli was served with the Complaint on May 5, 2014; to date, Radiancy, has not been served. The Company has filed a motion to dismiss this case; that motion is pending before the Court. A mediation was scheduled in this matter for November 24, 2014, but no settlement was reached. Radiancy and its officers intend to vigorously defend themselves against this lawsuit. At this time, the amount of any loss, or range of loss, cannot be reasonably estimated as the case has only been initiated and no discovery has been conducted to determine the validity of any claim or claims made by plaintiffs. Therefore, the Company has not recorded any reserve or contingent liability related to these particular legal matters. However, in the future, as the cases progress, the Company may be required to record a contingent liability or reserve for these matters. | |||||
On June 30, 2014, the Company's subsidiary, Radiancy, Inc., was served with a class action lawsuit filed in the Superior Court in the State of California, County of Kern. The suit was filed by April Cantley, who purchased Radiancy's no!no! Hair products. It alleges various violations of state business and consumer protection codes including false and misleading advertising, breach of express and implied warranties and breach of the California Legal Remedies Act. The complaint seeks certification of the class, which consists of customers in the State of California who purchased the no!no! Hair devices. The complaint also seeks an unspecified amount of monetary damages, pre-and post-judgment interest and attorneys' fees, expert witness fees and other costs. Radiancy has filed an Answer to this Complaint; the case is now in the discovery phase. Radiancy and its officers intend to vigorously defend themselves against this lawsuit. Discovery has now commenced in this action. At this time, the amount of any loss, or range of loss, cannot be reasonably estimated as the case has only been initiated and no discovery has been conducted to determine the validity of any claim or claims made by plaintiffs. Therefore, the Company has not recorded any reserve or contingent liability related to these particular legal matters. However, in the future, as the cases progress, the Company may be required to record a contingent liability or reserve for these matters. | |||||
From time to time in the ordinary course of our business, we and certain of our subsidiaries are involved in certain other legal actions and claims, including product liability, consumer, commercial, tax and governmental matters, and claims regarding false advertising and product efficacy against the no!no! Hair products which were already raised and reviewed in the Tria litigation. We believe, based on discussions with legal counsel, that these other litigations and claims will likely be resolved without a material effect on our consolidated financial position, results of operations or liquidity. However, litigation is inherently unpredictable, and excessive verdicts can result from litigation. Although we believe we have substantial defenses in these matters, we may, in the future, incur judgments or enter into settlements of claims that could have a material adverse effect on our results of operations in a particular period. | |||||
Employment Agreements | |||||
The Company has severance agreements with certain key executives and employees that create certain liabilities in the event of their termination of employment by the company without cause, or following a change in control of the Company. The aggregate commitment under these executive severance agreements, should all covered executives and employees be terminated other than for cause, was approximately $10,073 as of December 31, 2014, based on 2014 salary levels. Should all covered executives and certain key employees be terminated following a change in control of the Company, the aggregate commitment under these executive severance agreements at December 31, 2014 was approximately $9,820, based on 2014 salary levels. |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Stockholders' Equity [Abstract] | ||||||
Stockholders' Equity | Note 12 | |||||
Stockholders' Equity: | ||||||
Preferred Stock | ||||||
The Company has authorized preferred stock consisting of 5,000,000 shares with a $.01 par value, which shall be designated as blank check preferred. The Board of Directors may authorize the issuance from time to time of one or more classes of preferred stock with one or more series within any class thereof, with such voting powers, full or limited, or without voting powers and with such designations, preferences and relative, participating, optional or special rights and qualifications, limitations or restrictions thereon as shall be set forth in the resolution or resolutions adopted by the Board of Directors providing for the issuance of such preferred shares. At December 31, 2014 and 2013, no shares of preferred stock were issued or outstanding. | ||||||
Common Stock | ||||||
On December 12, 2014, the Company closed on a registered offering in which it sold an aggregate of 645,000 shares of its common stock at an offering price of $2.19 per share. The closing price of the Company's common stock was $1.37 on December 12, 2014. The sale resulted in net proceeds of approximately $1.4 million. | ||||||
On August 18, 2012, the Board of Directors approved a stock repurchase program up to a maximum of $25 million. In August 2013, the Board of Directors has authorized an additional $30 million share re-purchase program of its common shares in the open market over the next twelve months, at such times and prices as determined appropriate by the Company's management in collaboration with the Board of Directors. To date, the Company has repurchased 2,987,413 shares at an average price of $13.98 per share for a total of $41,757. | ||||||
On April 27, 2012, the Company closed on a two-tranche registered offering in which it sold an aggregate of 3,023,432 shares of its common stock at an offering price of $13.23 per share. The sale resulted in net proceeds of approximately $37.8 million. The net proceeds were used for general corporate purposes, including capital expenditures, continued product development, sales and marketing initiatives and working capital. | ||||||
Common Stock Options | ||||||
The Company has a Non-Employee Director Stock Option Plan. This plan has authorized 370,000 shares; of which 7,000 shares had been issued or were reserved for issuance as awards of shares of common stock, and 14,578 shares were reserved for outstanding stock options. The directors, who were elected to our Board in connection with the reverse merger, each received a one-time stock award of 5,000 shares of the Company's common stock in January 2012. | ||||||
In addition, the Company has a 2005 Equity Compensation Plan ("2005 Equity Plan"). The 2005 Equity Plan has authorized 6,000,000 shares, of which 1,576,095 shares had been issued or were reserved for issuance as awards of shares of common stock, and 1,144,976 shares were reserved for outstanding options. | ||||||
A summary of option transactions for all of the Company's stock options during the years ended December 31, 2014, 2013 and 2012 follows: | ||||||
Number of Stock Options | Weighted Average Exercise Price | |||||
Outstanding at December 31, 2011 | 180,718 | $19.54 | ||||
Granted | 739,000 | 15.87 | ||||
Exercised | -10,048 | 6.67 | ||||
Expired/cancelled | -11,129 | 20.25 | ||||
Outstanding at December 31, 2012 | 898,541 | 16.65 | ||||
Granted | 259,625 | 16.59 | ||||
Exercised | -3,750 | 6.24 | ||||
Expired/cancelled | -21,738 | 31.36 | ||||
Outstanding at December 31, 2013 | 1,132,678 | 16.51 | ||||
Granted | 181,500 | 14.1 | ||||
Exercised | - | - | ||||
Expired/cancelled | -154,624 | 15.73 | ||||
Outstanding at December 31, 2014 | 1,159,554 | $16.23 | ||||
Exercisable at December 31, 2014 | 510,954 | $16.47 | ||||
The outstanding and exercisable options at December 31, 2014, have a range of exercise prices and associated weighted remaining contractual life and weighted average exercise price, as follows: | ||||||
Weighted Average Remaining Contractual Life (years) | ||||||
Options Range of Exercise Prices | Outstanding Number of Shares | Weighted Average Exercise Price | Exercisable Number of Shares | Exercisable Weighted Avg. Exercise Price | ||
$0 - $7.50 | 21,584 | 4.58 | $ 6.12 | 21,584 | $ 6.11 | |
$7.51 - $15.00 | 699,622 | 7.85 | $ 14.11 | 255,022 | $ 13.93 | |
$15.01 - $22.50 | 427,900 | 7.32 | $ 19.02 | 223,900 | $ 18.13 | |
$22.51- up | 10,448 | 1.56 | $ 64.42 | 10,448 | $ 64.42 | |
Total | 1,159,554 | 7.54 | $ 16.23 | 510,954 | $ 16.47 | |
The outstanding options will expire, as follows: | ||||||
Year Ending | Number of Shares | Weighted Average Exercise Price | ||||
Exercise Price | ||||||
2015 | 2,499 | $102.90 | $102.90 | |||
2016 | 2,634 | $69.48 | $48.72 - $93.66 | |||
2017 | 3,146 | $46.85 | $46.62 - $47.88 | |||
2018 | 2,169 | $39.41 | $37.80 - $39.90 | |||
2019 and later | 1,149,106 | $15.79 | $5.70 - $20.00 | |||
1,159,554 | $16.23 | $5.70 - $102.90 | ||||
As the share price as of December 31, 2014 was $1.53, the aggregate intrinsic value for options outstanding and exercisable was immaterial. | ||||||
The Company uses the Black-Scholes option-pricing model to estimate fair value of grants of stock options with the following weighted average assumptions: | ||||||
Year Ended December 31, | ||||||
2014 | 2013 | 2012 | ||||
Risk-free interest rate | 2.17% | 1.30% | N/A | |||
Volatility | 78.41% | 85.25% | N/A | |||
Expected dividend yield | 0% | 0% | N/A | |||
Expected life | 5.5 years | 5.5 years | N/A | |||
Estimated forfeiture rate | 0% | 0% | N/A | |||
The Company calculates expected volatility for a share-based grant based on historic daily stock price observations of its common stock. For estimating the expected term of share-based grants made in the years ended December 31, 2014 and 2013, the Company has adopted the simplified method. The Company has used historical data to estimate expected employee behaviors related to option exercises and forfeitures and included these expected forfeitures as a part of the estimate of expense as of the grant date. | ||||||
With respect to grants of options, the risk-free rate of interest is based on the U.S. zero-coupon US Government bond rates appropriate for the expected term of the grant or award. | ||||||
On December 10, 2014, the Company issued 290,000 restricted stock units to a number of employees. The restricted shares have a purchase price of $0.01 per share and vest, and cease to be subject to the Company's right of repurchase, over a four-year period. The Company determined the fair value of the awards to be the fair value of the Company's common stock units on the date of issuance less the value paid for the award. The aggregate fair value of these restricted stock issued was $435. On November 7, 2014, the Company also issued 390,000 restricted stock units to two executive employees. The restricted shares have a purchase price of $0.01 per share and vest, and cease to be subject to the Company's right of repurchase, over a four-year period. The Company determined the fair value of the awards to be the quoted market value of the Company's common stock on the date of issuance less the value paid for the award. The aggregate fair value of these restricted stock issued was $1,217. | ||||||
On May 12, 2014, the Company granted 141,337 restricted stock units to three LCA employees as part of their respective employment agreements related to the acquisition. These restricted shares have a purchase price of $0.01 per share and vest, and cease to be subject to the Company's right of repurchase, over a three-year period. The Company determined the fair value of the awards to be the quoted market value of the Company's common stock on the date of issuance less the value paid for the award. The aggregate fair value of these restricted stock issued was $1,936. The Company also granted an aggregate of 109,000 options to purchase common stock to a number of employees with a strike price of $13.70, which was higher than the quoted market value of our stock at the date of grants. The options vest over four years and expire ten years from the date of grant. The aggregate fair value of these options granted was $975. | ||||||
On April 17, 2014, the Company issued 5,000 shares of common stock to a non-employee director for an aggregate fair value of $75. | ||||||
On February 27, 2014, the Company granted an aggregate of 71,500 options to purchase common stock to a number of employees and consultants with a strike price of $14.80, which was higher than the quoted market value of our stock at the date of grants. The options vest over five years and expire ten years from the date of grant. The aggregate fair value of the options granted was $718. | ||||||
On February 28, 2013, the Company granted an aggregate of 177,125 options to purchase common stock to a number of employees and consultants with a strike price of $15, which was higher than the quoted market value of our stock at the date of grants. The options vest over five years and expire ten years from the date of grant. Also on February 28, 2013, the Company granted an aggregate of 82,500 non-qualified options to purchase common stock to two executive employees with a strike price of $20, which was set to match the exercise price of the warrants issued in the reverse merger and was higher than the quoted market value of our stock at the date of grant. The aggregate fair value of the options granted was $2,590. The options vest over five years and expire ten years from the date of grant. | ||||||
On January 26, 2012, the Company issued 30,000 shares of common stock to the six non-employee directors with an aggregate fair value of $405. | ||||||
On March 18, 2012, the Company granted an aggregate of 509,000 options to purchase common stock to a number of employees and consultants with a strike price of $14, which was higher than the quoted market value of our stock at the date of grants. The options vest over five years and expire ten years from the date of grant. Also on March 18, 2012, the Company granted an aggregate of 230,000 non-qualified options to purchase common stock to two executive employees with a strike price of $20, which was set to match the exercise price of the warrants issued in the reverse merger and was higher than the quoted market value of our stock at the date of grant. The aggregate fair value of the options granted was $6,652. The options vest over five years and expire ten years from the date of grant. | ||||||
Total stock-based compensation expense was as $4,936, $4,985 and $6,197 for the years ended December 31, 2014, 2013 and 2012. | ||||||
At December 31, 2014, there was $7,644 of total unrecognized compensation cost related to non-vested stock awards that is expected to be recognized over a weighted-average period of 3.14 years. | ||||||
Common Stock Warrants | ||||||
As a result of the cash raise on December 12, 2014, the Company issued separately detachable warrants to the shareholders participating in the raise at 0.50 per share acquired. The warrants have the following principal terms: (i) a warrant exercise price of $2.25 per share of common stock, (ii) an exercise period of December 12, 2015 through December 12, 2017. The underlying warrants were registered via registration statement. | ||||||
Following the closing of the reverse merger, the Company had warrants outstanding, a majority of which were issued in conjunction with the reverse merger on December 13, 2011. As a result of the reverse merger, Pre-merged PhotoMedex shareholders were issued warrants at a ratio of 0.305836 per each outstanding share held or a total of 1,026,435 warrants. The warrants have the following principal terms: (i) a warrant exercise price of $20 per share of common stock, (ii) an exercise period of five years, and (iii) the right of the Company to notify the holders of the warrants of an earlier expiration of the warrants, at any time following such time as the Company's common stock will have had a closing trading price in excess of $30 per share for a period of 20 consecutive trading days, provided that such earlier expiration date shall not be earlier than that date which is 20 trading days following the delivery of such notification by the Company. | ||||||
A summary of warrant transactions for the years ended December 31, 2014, 2013 and 2012 follows: | ||||||
Weighted Average | ||||||
Exercise Price | ||||||
Number of Warrants | ||||||
Outstanding at January 1, 2012 | 1,067,240 | $19.98 | ||||
Issued | 25,000 | 20 | ||||
Exercised | -17,756 | 7.5 | ||||
Expired/cancelled | -11,216 | 47.04 | ||||
Outstanding at December 31, 2012 | 1,063,268 | 19.91 | ||||
Issued | - | - | ||||
Exercised | - | - | ||||
Expired/cancelled | -4,589 | 18.48 | ||||
Outstanding at December 31, 2013 | 1,058,679 | 19.91 | ||||
Issued | 322,500 | 2.25 | ||||
Exercised | - | - | ||||
Expired/cancelled | - | - | ||||
Outstanding at December 31, 2014 | 1,381,179 | $15.79 | ||||
At December 31, 2014, all outstanding warrants were exercisable. As the share price as of December 31, 2014 was $1.53, the aggregate intrinsic value for warrants outstanding and exercisable was immaterial. | ||||||
If not previously exercised, the outstanding warrants will expire as follows: | ||||||
Weighted Average | ||||||
Exercise Price | ||||||
Year Ending December 31, | Number of Warrants | |||||
2015 | 32,250 | $17.19 | ||||
2016 | 1,026,429 | 20 | ||||
2017 | 322,500 | 2.25 | ||||
1,381,179 | $15.79 | |||||
As all of the then outstanding warrants were fully vested at the date of the consummation of the reverse merger, the fair value of the warrants at that date was included as part of the calculation of the consideration transferred, as the consideration was determined based on the equity interests Radiancy would have had to issue to the stockholders of Pre-merged PhotoMedex to provide them the same equity interests in the combined company. |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Taxes [Abstract] | |||||||||||||
Income Taxes | Note 13 | ||||||||||||
Income Taxes: | |||||||||||||
Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. | |||||||||||||
A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income and the reversal of deferred tax liabilities during the period in which the related temporary difference becomes deductible. The benefit of tax positions taken or expected to be taken in the Company's income tax returns are recognized in the consolidated financial statements if such positions are more likely than not of being sustained. | |||||||||||||
For the years ended December 31, 2014, 2013, and 2012, the following table summarizes the components of income before income taxes from continuing operations and the provision for income taxes: | |||||||||||||
Year Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Income (loss) before income tax: | |||||||||||||
U.S. | $ | (25,398 | ) | $ | 7,700 | $ | 3,152 | ||||||
Israel | 1,780 | 14,279 | 20,410 | ||||||||||
Other Foreign | (1,813 | ) | 768 | 3,365 | |||||||||
Income (loss) before income taxes | $ | (25,431 | ) | $ | 22,747 | $ | 26,927 | ||||||
Income tax expense (benefit): | |||||||||||||
United States - Federal tax: | |||||||||||||
Current | $ | (1,030 | ) | $ | (1,253 | ) | $ | 2,752 | |||||
Deferred | 34,117 | 1,795 | (1,572 | ) | |||||||||
United States - State tax: | |||||||||||||
Current | 195 | 180 | 315 | ||||||||||
Deferred: | 245 | 850 | (2,074 | ) | |||||||||
Israel: | |||||||||||||
Current | 1,431 | 2,781 | 4,034 | ||||||||||
Deferred | (190 | ) | (237 | ) | (50 | ) | |||||||
Other foreign: | |||||||||||||
Current | 81 | 54 | 1371 | ||||||||||
Deferred: | 1,463 | 200 | (338 | ) | |||||||||
Income tax expense | $ | 36,312 | $ | 4,370 | $ | 4,438 | |||||||
For the years ended December 31, 2014, 2013 and 2012, the following table reconciles the federal statutory income tax rate to the effective income tax rate: | |||||||||||||
Year Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Federal Tax rate | 34 | % | 34 | % | 34 | % | |||||||
Federal tax expense (benefit) at 34% | $ | (9,349 | ) | $ | 7,733 | $ | 9,157 | ||||||
State and local income tax, net of Federal benefit | 373 | 958 | 286 | ||||||||||
Foreign rate differential | (483 | ) | (2,404 | ) | (3,962 | ) | |||||||
Increase in taxes from permanent differences in stock-based compensation | 330 | 420 | 618 | ||||||||||
US taxation of foreign earnings – Subpart F | 11,571 | 357 | 403 | ||||||||||
Increase (decrease) in uncertain tax positions | - | 269 | (2,325 | ) | |||||||||
Return to provision and other adjustments | 301 | (1,963 | ) | - | |||||||||
Impact of tax rate change on deferred taxes | 724 | (942 | ) | - | |||||||||
Foreign tax credits | (7,041 | ) | (341 | ) | - | ||||||||
Tax on foreign exchange | 1,578 | - | - | ||||||||||
Tax on undistributed earnings | 3,333 | - | - | ||||||||||
Change in valuation allowance | 34,695 | 116 | - | ||||||||||
Other, net | 280 | 167 | 261 | ||||||||||
Income tax expense | $ | 36,312 | $ | 4,370 | $ | 4,438 | |||||||
As of December 31, 2014, the Company had approximately $48 million of Federal net operating loss carryforwards in the United States. Other tax attributes in the United States and their approximate amounts include: State NOLs - $3.2 million; foreign tax credits -$7.1 million; and, AMT tax credits – $0.1 million. A 100% valuation allowance has been recorded against these tax attributes and the net deferred tax assets of the U.S. group of companies. The net deferred tax assets – liabilities of the U.S. companies is reduced to zero (0). Based on current operating conditions and the availability of projected future sources of taxable income, the Company determined that it was not more likely than not that the net deferred tax assets of the U.S. companies would be realized in the future. The State NOLs expire generally from 2017 to 2034. | |||||||||||||
After conversion to U.S. dollars, Photo Therapeutics Limited had approximately $11 million of net operating loss carryforwards in the U.K. A valuation allowance of approximately $7 million has been applied against these losses. Additionally, NOLs have been recorded in Brazil, Colombia, India, and Korea. The Brazilian NOL is approximately $1.7 million. The individual NOLs of the other companies are less than $0. 1 million. All these NOLs have a 100% valuation allowance recorded. | |||||||||||||
The following table summarizes the components of deferred income tax assets and (liabilities): | |||||||||||||
December 31, | |||||||||||||
2014 | 2013 | ||||||||||||
Loss carryforwards | $ | 39,217 | $ | 21,092 | |||||||||
AMT credits | 112 | 112 | |||||||||||
Foreign tax credits | 7,066 | - | |||||||||||
Accrued employment expenses | 1,785 | 1,256 | |||||||||||
Amortization and write-offs | 9,480 | 8,883 | |||||||||||
Capitalized R&D costs | 2,663 | 2,933 | |||||||||||
Deferred revenues | - | 84 | |||||||||||
Depreciation | 2,022 | 4,360 | |||||||||||
Doubtful accounts | 4,177 | 3,499 | |||||||||||
Inventory reserves | 1,030 | 822 | |||||||||||
Tax on undistributed earnings | (3,333 | ) | - | ||||||||||
Other accruals and reserves | 324 | 228 | |||||||||||
Return allowances | 2,787 | 5,660 | |||||||||||
Translation adjustments | -44 | 61 | |||||||||||
Gross deferred tax asset | 67,286 | 48,990 | |||||||||||
Less: valuation allowance | (65,957 | ) | (11,910 | ) | |||||||||
Net deferred tax asset | $ | 1,329 | $ | 37,080 | |||||||||
Among current assets | $ | 762 | $ | 13,041 | |||||||||
Among other non-current assets | 567 | 24,039 | |||||||||||
PhotoMedex files corporate income tax returns in the United States, both in the Federal jurisdiction and in various State jurisdictions. The Company is subject to Federal income tax examination for calendar years 2011 through 2013 and is also generally subject to various State income tax examinations for calendar years 2006 through 2013. Photo Therapeutics Limited files in the United Kingdom. Radiancy (Israel) Limited files in Israel. The Israeli subsidiary is subject to tax examination for calendar years 2011 through 2013. | |||||||||||||
The Israeli subsidiary is entitled to reduced tax rates regarding income that is subject to tax pursuant to the "approved enterprise" until end of year 2012 and "preferred enterprise" from year 2013. Other income is subject to the regular corporate income tax rate. For the year 2014 all income is Israel was taxed at the regular corporate income tax rate. | |||||||||||||
Change in Israel rates. Effective for tax periods beginning 1 January 2014, the standard corporate income tax rate was increased from 25% to 26.5% and preferred income tax rate (for preferred enterprise located in an area which is not development zone A) was increased to 16%. | |||||||||||||
Income derived from the approved enterprise was tax-exempt for the first two years. In the succeeding five to eight years (depending on the classification of the Company as a foreign-invested company) the income was taxed at a reduced rate. In the event of cash dividends from income which was tax-exempt as above, the Israeli subsidiary would have to pay 15% tax in respect of the amount distributed. The Israeli subsidiary intends to reinvest the amount of such tax-exempt income and not to distribute it as dividends. | |||||||||||||
The entitlement to the above benefits is contingent upon fulfillment of the conditions stipulated by the law, the regulations published thereunder (and the letters of approval for the specific investments in the approved enterprise) in the preferred enterprise. Management of the Israeli subsidiary believes that as of December 31, 2014 the subsidiary was in compliance with the above-mentioned conditions. | |||||||||||||
Change in U.K. rates. In addition, effective for tax periods beginning on April 1, 2013, the United Kingdom tax rate was reduced from 24% to 23%. A reduction from 23% to 21% was effective on April 1, 2014. A further enacted decrease in the tax rate to 21% and 20% will take effect on April 1, 2015. These changes in rate will affect the tax provision with regard to the tax attributes of Photo Therapeutics Limited, the United Kingdom subsidiary. | |||||||||||||
Unrecognized Tax Benefits. The Company is subject to income taxation in the U.S., Israel, the U.K., Brazil, Colombia, Hong Kong, India and The Republic of Korea. Unrecognized tax benefits reflect the difference between positions taken or expected to be taken on income tax returns and the amounts recognized in the financial statements. Resolution of the related tax positions through negotiations with the relevant tax authorities or through litigation could take years to complete. It is difficult predict the timing of resolution for tax positions since such timing is not entirely within the control of the Company. It is reasonably possible that the total amount of unrecognized tax benefits could both increase and decrease in the next 12 months, with no material impact on earnings. | |||||||||||||
The Company and its subsidiaries file income tax returns in all of the countries listed above. | |||||||||||||
In 2012, Management conducted an analysis of the facts and law surrounding the then existing income tax uncertainties, and found that such liability as may have arisen was of a much lesser magnitude and is able to be extinguished by loss carryforwards and carrybacks, | |||||||||||||
Reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | |||||||||||||
Balance at January 1, 2012 | $ | 2,700 | |||||||||||
Additions / Settlements during 2012 | (2,325 | ) | |||||||||||
Balance December 31, 2012 | 375 | ||||||||||||
Additions/ Settlements due 2013 | 269 | ||||||||||||
Balance at December 31, 2013 | 644 | ||||||||||||
Additions / Settlements due 2014 | - | ||||||||||||
Balance at December 31, 2014 | $ | 644 |
Significant_Customer_Concentra
Significant Customer Concentration | 12 Months Ended |
Dec. 31, 2014 | |
Significant Customer Concentration [Abstract] | |
Significant Customer Concentration | Note 14 |
Significant Customer Concentration: | |
No single customer accounted for more than 10% of total company revenues for the years ended December 31, 2014, 2013 and 2012. |
Business_Segment_and_Geographi
Business Segment and Geographic Data | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Business Segment and Geographic Data [Abstract] | |||||||||||||||||
Business Segment and Geographic Data | Note 15 | ||||||||||||||||
Business Segment and Geographic Data: | |||||||||||||||||
Effective December 13, 2011, the Company reorganized its business into three operating segments to better align its organization based upon the Company's management structure, products and services offered, markets served and types of customers, as follows: The Consumer segment derives its revenues from the design, development, manufacturing and selling of long-term hair reduction and acne consumer products. The Physician Recurring segment derives its revenues from the XTRAC procedures performed by dermatologists, the sales of skincare products, the sales of surgical disposables and accessories to hospitals and surgery centers and on the repair, maintenance and replacement parts on our various products. The Professional segment generates revenues from the sale of equipment, such as lasers, medical and esthetic light and heat based products and LED products. Management reviews financial information presented on an operating segment basis for the purposes of making certain operating decisions and assessing financial performance. For a period during 2014 the Company had a fourth operating segment, Clinics segment. This represented our LCA business which is classified as discontinued operations as of December 31, 2014. See also Note 2, Discontinued Operations. | |||||||||||||||||
Unallocated operating expenses include costs that are not specific to a particular segment but are general to the group; included are expenses incurred for administrative and accounting staff, general liability and other insurance, professional fees and other similar corporate expenses. Interest and other financing income (expense), net is also not allocated to the operating segments. Unallocated assets include cash and cash equivalents, prepaid expenses and deposits. | |||||||||||||||||
The following tables reflect results of operations from our business segments for the periods indicated below: | |||||||||||||||||
Year ended December 31, 2014 | |||||||||||||||||
CONSUMER | PHYSICIAN RECURRING | PROFESSIONAL | TOTAL | ||||||||||||||
Revenues | $ | 120,931 | $ | 34,240 | $ | 8,370 | $ | 163,541 | |||||||||
Costs of revenues | 20,307 | 12,718 | 5,594 | 38,619 | |||||||||||||
Gross profit | 100,624 | 21,522 | 2,776 | 124,922 | |||||||||||||
Gross profit % | 83.2 | % | 62.9 | % | 33.2 | % | 76.4 | % | |||||||||
Allocated operating expenses: | |||||||||||||||||
Engineering and product development | 1,105 | 1,177 | 804 | 3,086 | |||||||||||||
Selling and marketing expenses | 89,637 | 16,347 | 1,185 | 107,169 | |||||||||||||
Unallocated operating expenses | - | - | - | 35,711 | |||||||||||||
90,742 | 17,524 | 1,989 | 145,966 | ||||||||||||||
Income (loss) from continuing operations | 9,882 | 3,998 | 787 | (21,044 | ) | ||||||||||||
Interest and other financing expense, net | - | - | - | (4,387 | ) | ||||||||||||
Income (loss) from continuing operations before taxes | $ | 9,882 | $ | 3,998 | $ | 787 | $ | (25,431 | ) | ||||||||
Year ended December 31, 2013 | |||||||||||||||||
CONSUMER | PHYSICIAN RECURRING | PROFESSIONAL | TOTAL | ||||||||||||||
Revenues | $ | 188,259 | $ | 28,548 | $ | 7,857 | $ | 224,664 | |||||||||
Costs of revenues | 26,794 | 13,022 | 5,219 | 45,035 | |||||||||||||
Gross profit | 161,465 | 15,526 | 2,638 | 179,629 | |||||||||||||
Gross profit % | 85.8 | % | 54.4 | % | 33.6 | % | 80 | % | |||||||||
Allocated operating expenses: | |||||||||||||||||
Engineering and product development | 1,100 | 1,371 | 835 | 3,306 | |||||||||||||
Selling and marketing expenses | 112,898 | 12,681 | 1,949 | 127,528 | |||||||||||||
Unallocated operating expenses | - | - | - | 26,750 | |||||||||||||
113,998 | 14,052 | 2,784 | 157,584 | ||||||||||||||
Income (loss) from operations | 47,467 | 1,474 | (146 | ) | 22,045 | ||||||||||||
Interest and other financing income, net | - | - | - | 702 | |||||||||||||
Net income (loss) before taxes | $ | 47,467 | $ | 1,474 | $ | (146 | ) | $ | 22,747 | ||||||||
Year ended December 31, 2012 | |||||||||||||||||
CONSUMER | PHYSICIAN RECURRING | PROFESSIONAL | TOTAL | ||||||||||||||
Revenues | $ | 188,425 | $ | 21,284 | $ | 10,942 | $ | 220,651 | |||||||||
Costs of revenues | 28,965 | 11,512 | 6,165 | 46,642 | |||||||||||||
Gross profit | 159,460 | 9,772 | 4,777 | 174,009 | |||||||||||||
Gross profit % | 84.6 | % | 45.9 | % | 43.7 | % | 78.9 | % | |||||||||
Allocated operating expenses: | |||||||||||||||||
Engineering and product development | 876 | 1,201 | 837 | 2,914 | |||||||||||||
Selling and marketing expenses | 102,736 | 10,203 | 3,548 | 116,487 | |||||||||||||
Unallocated operating expenses | - | - | - | 27,330 | |||||||||||||
103,612 | 11,404 | 4,385 | 146,731 | ||||||||||||||
Income (loss) from operations | 55,848 | (1,632 | ) | 392 | 27,278 | ||||||||||||
Interest and other financing expense, net | - | - | - | (351 | ) | ||||||||||||
Net income (loss) before taxes | $ | 55,848 | $ | (1,632 | ) | $ | 392 | $ | 26,927 | ||||||||
For the years ended December 31, 2014, 2013 and 2012, net revenues by geographic area (determined by ship to locations) were as follows: | |||||||||||||||||
Year Ended December 31, | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
North America 1 | $ | 123,161 | $ | 174,850 | $ | 163,973 | |||||||||||
Asia Pacific 2 | 9,870 | 19,081 | 28,031 | ||||||||||||||
Europe (including Israel) | 29,227 | 27,849 | 25,521 | ||||||||||||||
South America | 1,283 | 2,884 | 3,126 | ||||||||||||||
$ | 163,541 | $ | 224,664 | $ | 220,651 | ||||||||||||
1 United States | $ | 109,203 | $ | 149,713 | $ | 135,950 | |||||||||||
1 Canada | $ | 13,953 | $ | 25,137 | $ | 28,023 | |||||||||||
2 Japan | $ | 1,750 | $ | 12,226 | $ | 21,134 | |||||||||||
For the years ended December 31, 2014, 2013 and 2012, long-lived assets by geographic area were as follows: | |||||||||||||||||
Year Ended December 31, | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
North America | $ | 12,385 | $ | 9,119 | $ | 5,772 | |||||||||||
Asia Pacific | 286 | - | - | ||||||||||||||
Europe (including Israel) | 1,127 | 1,370 | 987 | ||||||||||||||
South America | 4 | - | - | ||||||||||||||
$ | 13,802 | $ | 10,489 | $ | 6,759 |
Quarterly_Financial_Data_Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Quarterly Financial Data (Unaudited) [Abstract] | |||||||||||||||||
Quarterly Financial Data (Unaudited) | Note 16 | ||||||||||||||||
Quarterly Financial Data (Unaudited): | |||||||||||||||||
For the Quarter Ended | |||||||||||||||||
2014 | Mar. 31 | Jun. 30* | Sep. 30* | Dec. 31 | |||||||||||||
Revenues | $ | 50,075 | $ | 38,977 | $ | 35,611 | $ | 38,878 | |||||||||
Gross profit | 39,730 | 30,208 | 26,896 | 28,088 | |||||||||||||
Net loss | (345 | ) | (7,480 | ) | (14,943 | ) | (98,726 | ) | |||||||||
Net loss per share: | |||||||||||||||||
Basic | $ | (0.02 | ) | $ | (0.40 | ) | $ | (0.80 | ) | $ | (5.20 | ) | |||||
Diluted | $ | (0.02 | ) | $ | (0.40 | ) | $ | (0.80 | ) | $ | (5.20 | ) | |||||
Shares used in computing net loss per share: | |||||||||||||||||
Basic | 18,719,419 | 18,723,484 | 18,724,419 | 19,041,451 | |||||||||||||
Diluted | 18,719,419 | 18,723,484 | 18,724,419 | 19,041,451 | |||||||||||||
2013 | Mar. 31 | Jun. 30 | Sep. 30 | Dec. 31 | |||||||||||||
Revenues | $ | 57,216 | $ | 58,065 | $ | 45,893 | $ | 63,490 | |||||||||
Gross profit | 45,350 | 46,675 | 36,827 | 50,777 | |||||||||||||
Net income | 7,212 | 7,094 | 886 | 3,185 | |||||||||||||
Net income per share: | |||||||||||||||||
Basic | $ | 0.35 | $ | 0.34 | $ | 0.04 | $ | 0.16 | |||||||||
Diluted | $ | 0.34 | $ | 0.34 | $ | 0.04 | $ | 0.16 | |||||||||
Shares used in computing net income per share: | |||||||||||||||||
Basic | 20,678,023 | 20,573,048 | 19,982,967 | 19,400,341 | |||||||||||||
Diluted | 21,147,583 | 21,033,349 | 20,441,262 | 19,602,611 | |||||||||||||
2012 | Mar. 31 | Jun. 30 | Sep. 30 | Dec. 31 | |||||||||||||
Revenues | $ | 50,273 | $ | 58,906 | $ | 56,681 | $ | 54,791 | |||||||||
Gross profit | 39,039 | 46,551 | 45,400 | 43,019 | |||||||||||||
Net income | 4,857 | 4,213 | 7,525 | 5,894 | |||||||||||||
Net income per share: | |||||||||||||||||
Basic | $ | 0.26 | $ | 0.2 | $ | 0.35 | $ | 0.28 | |||||||||
Diluted | $ | 0.26 | $ | 0.2 | $ | 0.35 | $ | 0.27 | |||||||||
Shares used in computing net income per share: | |||||||||||||||||
Basic | 18,339,977 | 20,547,244 | 21,205,675 | 20,947,985 | |||||||||||||
Diluted | 18,876,163 | 21,034,814 | 21,752,845 | 21,356,819 | |||||||||||||
*The information has been retroactively adjusted to account for the LCA business which is classified as held for sale as of December 31, 2014, as a discontinued operations. |
Valuation_and_Qualifying_Accou
Valuation and Qualifying Accounts | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | |||||||||||||||||||||
Valuation and Qualifying Accounts | Note 17 | ||||||||||||||||||||
Valuation and Qualifying Accounts: | |||||||||||||||||||||
Additions Charged to | |||||||||||||||||||||
Balance at Beginning of Period | Cost and Expenses | Other Accounts | Deductions (1) | Balance at End of Period | |||||||||||||||||
Description | |||||||||||||||||||||
For The Year Ended December 31, 2014: | |||||||||||||||||||||
Allowance for Doubtful Accounts | $ | 10,734 | $ | 7,661 | $ | - | $ | (4,836 | ) | $ | 13,559 | ||||||||||
Allowance for Sales Returns | $ | 16,046 | $ | 35,771 | $ | - | $ | (44,166 | ) | $ | 7,651 | ||||||||||
For The Year Ended December 31, 2013: | |||||||||||||||||||||
Allowance for Doubtful Accounts | $ | 6,917 | $ | 5,958 | $ | - | $ | (2,141 | ) | $ | 10,734 | ||||||||||
Allowance for Sales Returns | $ | 11,901 | $ | 47,916 | $ | - | $ | (43,771 | ) | $ | 16,046 | ||||||||||
For The Year Ended December 31, 2012: | |||||||||||||||||||||
Allowance for Doubtful Accounts | $ | 3,196 | $ | 4,629 | $ | - | $ | (908 | ) | $ | 6,917 | ||||||||||
Allowance for Sales Returns | $ | 6,143 | $ | 43,284 | $ | - | $ | (37,526 | ) | $ | 11,901 | ||||||||||
-1 | Represents write-offs of specific accounts receivable or actual returns, as applicable. |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 18 |
Subsequent Events: | |
Effective January 31, 2015, the Company and its subsidiary LCA-Vision Inc. ("LCA") entered into a Stock Purchase Agreement (the "Stock Purchase Agreement") with Vision Acquisition, LLC ("Vision"), under which Vision acquired LCA and its subsidiaries from the Company for a total purchase price of $40 million in cash (the "Purchase Price"). After giving effect to working capital and indebtedness adjustments and the payment of professional fees, the Company realized net proceeds of approximately $36.5 million from this sale, of which $2 million was placed in escrow. The Company had originally purchased LCA in a stock-for- cash transaction which closed on May 12, 2014. Pursuant to the Termination of Joinder, dated as of January 31, 2015, LCA has been released from all of its obligations, including its guarantee and collateral obligations, in connection with the Company's Credit Agreement, dated as of May 12, 2014 (as amended, restated, supplemented or otherwise modified from time to time, the "Credit Agreement"), by and between the Company, JPMorgan Chase Bank, N.A., as Administrative Agent, First Niagara Bank, N.A. and PNC Bank, National Association, each as Co-Syndication Agents, J.P. Morgan Securities LLC, as Lead Arranger and Bookrunner, and the other Lenders party thereto. The Company has used the proceeds from this transaction to pay down portions of its outstanding revolving line of credit and term loan under the Credit Agreement. | |
The Purchase Price was subject to working capital and indebtedness adjustments at closing, in the amount of approximately $2.1 million. The closing working capital adjustment was based upon the difference between the target net working capital and an estimated computation of LCA's net working capital as of December 31, 2014. There will also be post-closing working capital and indebtedness adjustments. Pursuant to the post-closing working capital adjustment, the purchase price paid to the Company at closing will be adjusted up or down by an amount equal to the difference between LCA's net working capital as of December 31, 2014 and LCA's net working capital as of January 31, 2015, subject to a $250,000 collar (if applicable). | |
The Stock Purchase Agreement contains customary representations, warranties and covenants by each of the Company, LCA and Vision, as well customary indemnification provisions among the parties. | |
The parties entered into several ancillary agreements as part of this transaction. | |
Under a Contingency Escrow Agreement among the parties, $2 million of the Purchase Price (the "Escrow Amount") has been placed into an escrow account held by Fifth Third Bank, Cincinnati, Ohio, as Escrow Agent. Under the terms of the Stock Purchase Agreement, LCA and the Company must obtain consents to the transaction from certain of LCA's vendors; a designated portion of the Escrow Amount will be released to the Company upon the receipt of each consent. If a consent is not obtained, a designated portion of the Escrow Amount may be released to Vision. | |
The parties have also entered into an XTRAC Exclusivity Agreement, under which LCA has granted to the Company sole and exclusive rights to provide certain excimer light source products, systems and equipment to LCA's Lasik Plus centers for the next seven years. The terms of each placement, if any, will be determined on a center-by-center basis. | |
Finally, the Company and LCA have entered into a Transition Services Agreement, under which LCA will continue to provide certain accounting, human resources and call center services to the Company for an initial period of 60 days. During that period, the Company will arrange to transition those services back to the Company's own personnel and offices. | |
On March 10, 2015, each of the two executives, Dr. Dolev Rafaeli and Mr. Dennis McGrath, entered into Amended and Restated Employment Agreements (the "Amended Agreements") with the Company which supersede their respective Amended and Restated Employment Agreements previously entered into on August 5, 2014. | |
The March 2015 Amended Agreements were required by certain provisions contained in the Second Amended and Restated Forbearance Agreement between the Company and its Lenders. Under the Amended Agreements, all cash bonuses to Dr. Rafaeli and Mr. McGrath will be deferred until the Company's repayment of the outstanding Facilities under the Credit Agreement in accordance with the provisions of the Forbearance Agreement. | |
Under the cash bonus provisions of the Amended Agreements (and subject to the deferral described in the preceding praagraph), Dr. Rafaeli will receive quarterly cash bonuses equal to the greater of $300,000 per calendar quarter and 1% of the Company's U.S. GAAP sales per calendar quarter in excess of targets set by the Compensation Committee, and Mr. McGrath will receive an annual cash bonus of not less than $316,000 per year. All or a portion of such bonuses may be paid in shares of Company stock to the extent mutually agreed by the Board and the executive. | |
The Amended Agreements also clarify the executives' rights to resign due to "Good Reason" in the event of a breach of the Amended Agreements by the Company or for any reason during the 30-day period immediately following a Change of Control of the Company and to payment of deferred bonuses in connection with the termination of their employment. |
The_Company_and_Summary_of_Sig1
The Company and Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
The Company and Summary of Significant Accounting Policies [Abstract] | |||||||||
Accounting Principles | Accounting Principles | ||||||||
The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP"). Certain reclassifications from the prior year presentation have been made to conform to the current year presentation. These reclassifications did not have material impact on the Company's equity, net assets, results of operations or cash flows. | |||||||||
Principles of Consolidation | Principles of Consolidation | ||||||||
The consolidated financial statements include the accounts of the Company and the wholly and majority owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation | |||||||||
Held for Sale classification and Discontinued Operations | Held for Sale Classification and Discontinued Operations | ||||||||
A disposal group is reported as held for sale when management has approved or received approval to sell and is committed to a formal plan, the disposal group is available for immediate sale, the business is being actively marketed, the sale is anticipated to occur during the next 12 months and certain other specified criteria are met. A disposal group classified as held for sale is recorded at the lower of its carrying amount or estimated fair value less cost to sell. If the carrying value of the business exceeds its estimated fair value less cost to sell, a loss is recognized. However, when disposal group meets the held for sale criteria, the Company, first evaluates whether the carrying amounts of the assets not covered by ASC 360-10 included in the disposal group (such as goodwill) are required to be adjusted in accordance with other applicable GAAP before measuring the disposal group at fair value less cost to sell. | |||||||||
Assets and liabilities related to a disposal group classified as held for sale are segregated in the consolidated balance sheet in the period in which the business is classified as held for sale. | |||||||||
Operations of a disposal group are reported as discontinued operations if the disposal group is classified as held for sale, the operations and cash flows of the business have been or will be eliminated from our ongoing operations as a result of a disposal transaction and we will not have any significant continuing involvement in the operations of the business after the disposal transaction. The results of discontinued operations are reported in discontinued operations in the consolidated statement of operations for current and prior periods commencing in the period in which the business meets the criteria of a discontinued operation, and include any gain or loss recognized on closing or adjustment of the carrying amount to fair value less cost to sell. Depreciation is not recorded on assets of a business while it is classified as held for sale. | |||||||||
At December 31, 2014, held for sale assets and liabilities consisted of LCA operating segment, and its results of operations are presented as discontinued operations in the consolidated statement of operations (see also Note 2 Discontinued Operations). | |||||||||
Use of Estimates | Use of Estimates | ||||||||
The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States ("US GAAP") requires management to make estimates and assumptions that affect amounts reported of assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from those estimates and be based on events different from those assumptions. As of December 31, 2014, the more significant estimates include (1) revenue recognition, including provision for sales return and valuation allowances of accounts receivable; (2) valuation allowance of deferred tax assets and uncertainty in tax positions; and (3) stock based compensation. | |||||||||
Functional Currency | Functional Currency | ||||||||
The currency of the primary economic environment in which the operations of the Company, its U.S. subsidiaries and Radiancy Ltd., its subsidiary in Israel, are conducted is the US dollar ("$" or "dollars"). Thus, the functional currency of the Company and its subsidiaries (other than the foreign subsidiaries mentioned below) is the dollar (which is also the reporting currency of the Group). The operations of the other foreign subsidiaries are each conducted in the local currency of the subsidiary. These currencies include: Great Britain Pounds (GBP), Brazilian Real (BRL), Hong Kong Dollar (HKD), Columbian Peso (COP) and Indian Rupee (INR). Substantially all of the Group's revenues are derived in dollars or in other currencies linked to the dollar. Purchases of most materials and components are carried out in, or linked to the dollar. | |||||||||
Balances denominated in, or linked to, foreign currencies are stated on the basis of the exchange rates prevailing at the balance sheet date. For foreign currency transactions included in the statement of comprehensive income (loss), the exchange rates applicable to the relevant transaction dates are used. Transaction gains or losses arising from changes in the exchange rates used in the translation of such balances are carried to financing income or expenses. | |||||||||
Assets and liabilities of foreign subsidiaries, whose functional currency is the local currency, are translated from its respective functional currency to U.S. dollars at the balance sheet date exchange rates. Income and expense items are translated at the average rates of exchange prevailing during the year. Translation adjustments are reflected in the consolidated balance sheets as a component of accumulated other comprehensive income or loss. Deferred taxes are not provided on translation adjustments as the earnings of the subsidiaries are considered to be permanently reinvested. | |||||||||
Fair Value Measurements | Fair Value Measurements | ||||||||
The Company measures and discloses fair value in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification 820, Fair Value Measurements and Disclosures ("ASC Topic 820"). ASC Topic 820 defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions there exists a three-tier fair-value hierarchy, which prioritizes the inputs used in measuring fair value as follows: | |||||||||
• | Level 1 - unadjusted quoted prices are available in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date. | ||||||||
• | Level 2 – pricing inputs are other than quoted prices in active markets that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. | ||||||||
• | Level 3 – pricing inputs are unobservable for the non-financial asset or liability and only used when there is little, if any, market activity for the non-financial asset or liability at the measurement date. The inputs into the determination of fair value require significant management judgment or estimation. Fair value is determined using comparable market transactions and other valuation methodologies, adjusted as appropriate for liquidity, credit, market and/or other risk factors. | ||||||||
This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. | |||||||||
The fair value of cash and cash equivalents and short term bank deposits are based on its demand value, which is equal to its carrying value. The estimated fair values of notes payable, short-term and long-term debt which are based on borrowing rates that are available to the Company for loans with similar terms, collateral and maturity approximate the carrying values. Additionally, the carrying value of all other monetary assets (including long term receivables which bear interest) and liabilities (including the secured credit facilities) is estimated to be equal to their fair value due to the short-term nature of these instruments. | |||||||||
Derivative financial instruments are measured at fair value, on a recurring basis. The fair value of derivatives generally reflects the estimated amounts that the Group would receive or pay to terminate the contracts at the reporting dates, based on the prevailing currency prices and the relevant interest rates. Such measurement is classified within Level 2. | |||||||||
In addition to items that are measured at fair value on a recurring basis, there are also assets and liabilities that are measured at fair value on a nonrecurring basis. Assets and liabilities that are measured at fair value on a nonrecurring basis include certain long-lived assets including goodwill. As such, we have determined that each of these fair value measurements reside within Level 3 of the fair value hierarchy. | |||||||||
Cash and Cash Equivalents | Cash and Cash Equivalents | ||||||||
The Company invests its excess cash in highly liquid short-term investments. The Company considers short-term investments that are purchased with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents consisted of cash and money market accounts at December 31, 2014 and 2013. | |||||||||
Short-term Deposits | Short-term Deposits | ||||||||
Short-term deposits are deposits with original maturities of more than three months but less than one year. Short-term deposits are presented at their costs including accrued interest. | |||||||||
Accounts Receivable | Accounts Receivable | ||||||||
The majority of the Company's accounts receivable (other than LCA) are due from consumers, distributors (domestic and international), physicians and other entities in the medical field. Accounts receivable are most often due within 30 to 90 days and are stated at amounts due from customers net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms are considered past due. The Company determines its allowance for doubtful accounts by considering a number of factors, including the length of time trade accounts receivable are past due, the Company's previous loss history, the customer's current ability to pay its obligation to the Company and available information about their credit risk, and the condition of the general economy and the industry as a whole. The Company writes off accounts receivable when they are considered uncollectible, and payments subsequently received on such receivables are credited to the allowance for doubtful accounts. The Company does not recognize interest accruing on accounts receivable past due. | |||||||||
Patient Receivables and Allowance for Doubtful Accounts | Patient Receivables and Allowance for Doubtful Accounts | ||||||||
The Company, through its subsidiary LCA-Vision (which is presented as a discontinued operations), provides financing to some of its patients, including those who could not otherwise obtain third-party financing. The terms of the financing usually require the patient to pay an up-front fee which is intended to cover some or all of the variable costs, and then generally the remainder of the payments are automatically deducted from the patient's bank account over a period of 12 to 36 months. The Company has recorded an allowance for doubtful accounts as a best estimate of the amount of probable credit losses from the patient financing program. Each month, management reviews and adjusts the allowance based upon past experience with patient financing. | |||||||||
For patients that the Company internally finances, the Company charges interest at market rates. Finance and interest charges on patient receivables were $507 for the period ended December 31, 2014. | |||||||||
Inventories | Inventories | ||||||||
Inventories are stated at the lower of cost or market. Cost is determined to be purchased cost for raw materials and the production cost (materials, labor and indirect manufacturing cost, including sub-contracted work components) for work-in-process and finished goods. For the Company's consumer and LHE products, cost is determined on the weighted-average method. For the pre-merged PhotoMedex's products, cost is determined on the first-in, first-out method. Throughout the laser manufacturing process, the related production costs are recorded within inventory. Work-in-process is immaterial, given the typically short manufacturing cycle, and therefore is disclosed in conjunction with raw materials. | |||||||||
The Company's equipment for the treatment of skin disorders (e.g. the XTRAC for psoriasis or vitiligo) will either (i) be placed in a physician's office and remain the property of the Company (at which date such equipment is transferred to property and equipment) or (ii) be sold to distributors or physicians directly. The cost to build a laser, whether for sale or for placement, is accumulated in inventory. | |||||||||
Reserves for slow moving and obsolete inventories are provided based on historical experience and product demand. Management evaluates the adequacy of these reserves periodically based on forecasted sales and market trend. | |||||||||
Property, Equipment and Depreciation | Property, Equipment and Depreciation | ||||||||
Property and equipment are recorded at cost, net of accumulated depreciation. Excimer lasers-in-service are depreciated on a straight-line basis over the estimated useful life of five years. For other property and equipment, depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, primarily three to seven years for computer hardware and software, furniture and fixtures, and machinery and equipment. Leasehold improvements are amortized over the lesser of the useful lives or lease terms. Expenditures for major renewals and betterments to property and equipment are capitalized, while expenditures for maintenance and repairs are charged as an expense as incurred. Upon retirement or disposition, the applicable property amounts are deducted from the accounts and any gain or loss is recorded in the consolidated statements of comprehensive (loss) income. Useful lives are determined based upon an estimate of either physical or economic obsolescence or both. | |||||||||
Management evaluates the realizability of property and equipment based on estimates of undiscounted future cash flows over the remaining useful life of the asset. If the amount of such estimated undiscounted future cash flows is less than the net book value of the asset, the asset is written down to fair value. As of December 31, 2014, no such write-down was required (see Impairment of Long-Lived Assetsand Intangibles). | |||||||||
Patent Costs and Licensed Technologies | Patent Costs and Licensed Technologies | ||||||||
Costs incurred to obtain or defend patents and licensed technologies are capitalized and amortized over the shorter of the remaining estimated useful lives or eight to 12 years. Core and product technology was also recorded in connection with the reverse acquisition on December 13, 2011 and is being amortized on a straight-line basis over ten years for core technology and five years for product technology. (See Note 6, Patent and Licensed Technologies). | |||||||||
Management evaluates the recoverability of intangible assets based on estimates of undiscounted future cash flows over the remaining useful life of the asset. If the amount of such estimated undiscounted future cash flows is less than the net book value of the asset, the asset is written down to fair value. As of December 31, 2014, no such write-down was required. (See Impairment of Long-Lived Assets and Intangibles). | |||||||||
Other Intangible Assets | Other Intangible Assets | ||||||||
Other intangible assets were recorded in connection with the reverse acquisition on December 13, 2011 and in connection with the acquisition of LCA. The assets which were determined to have definite useful lives are being amortized on a straight-line basis over ten years. Such assets primarily include customer relationships and trademarks. (See Note 7, Goodwill and Other Intangible Assets). | |||||||||
Management evaluates the recoverability of such other intangible assets based on estimates of undiscounted future cash flows over the remaining useful life of the asset. If the amount of such estimated undiscounted future cash flows is less than the net book value of the asset, the asset is written down to fair value. As of December 31, 2014 no such write-down was required. (See Impairment of Long-Lived Assets and Intangibles). | |||||||||
As of December 31, 2014, the indefinite life intangible is classified among the assets held for sale. | |||||||||
Accounting for the Impairment of Goodwill | Accounting for the Impairment of Goodwill | ||||||||
The Company evaluates the carrying value of goodwill annually at the end of the calendar year and also between annual evaluations if events occur or circumstances change that would more likely than not reduce the fair value of the reporting unit to which goodwill was allocated to below its carrying amount. Such circumstances could include, but are not limited to: (1) a significant adverse change in legal factors or in business climate, (2) unanticipated competition, or (3) an adverse action or assessment by a regulator. Goodwill impairment testing involves a two-step process. Step 1 compares the fair value of the Group's reporting units to which goodwill was allocated to their carrying values. If the fair value of the reporting unit exceeds its carrying value, no further analysis is necessary. The reporting unit fair value is based upon consideration of various valuation methodologies, including guideline transaction multiples, multiples of current earnings, and projected future cash flows discounted at rates commensurate with the risk involved. If the carrying amount of the reporting unit exceeds its fair value, Step 2 must be completed to quantify the amount of impairment. Step 2 calculates the implied fair value of goodwill by deducting the fair value of all tangible and intangible assets, excluding goodwill, of the reporting unit, from the fair value of the reporting unit as determined in Step 1. The implied fair value of goodwill determined in this step is compared to the carrying value of goodwill. If the implied fair value of goodwill is less than the carrying value of goodwill, an impairment loss, equal to the difference, is recognized. See Note 2, regarding the impairment of goodwill which was allocated to LCA. | |||||||||
Accrued Enhancement Expense | Accrued Enhancement Expense | ||||||||
The Company, through its subsidiary LCA-Vision (which is presented as a discontinued operations), includes participation in its LasikPlus Advantage Plan® (acuity program) in the base surgical price for substantially all of its patients. Under the acuity program, if determined to be medically appropriate, the Company provides post-surgical enhancements free of charge should the patient not achieve the desired visual correction during the initial procedure. Under this pricing structure, the Company accounts for the acuity program similar to a warranty obligation. Accordingly, the Company accrues the costs expected to be incurred to satisfy the obligation as a liability and cost of revenue at the point of sale given its ability to estimate reasonably such costs based on historical trends and the satisfaction of all other revenue recognition criteria. | |||||||||
This estimate is reviewed throughout the year with consideration to factors such as procedure cost and historical procedure volume when determining the appropriateness of the recorded balance. | |||||||||
Accrued Warranty Costs | Accrued Warranty Costs | ||||||||
The Company offers a standard warranty on product sales generally for a one to two-year period. In the case of domestic sales of XTRAC lasers, however, the Company has offered longer warranty periods, ranging from three to four years, in order to meet competition or meet customer demands. The Company provides for the expected cost of estimated future warranty claims on the date the product is sold. Total accrued warranty is included in other accrued liabilities on the balance sheet. The activity in the warranty accrual during the years ended December 31, 2014 and 2013 is summarized as follows: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Accrual at beginning of year | $ | 1,151 | $ | 1,440 | |||||
Additions charged to warranty expense | 808 | 1,206 | |||||||
Expiring warranties | (341 | ) | (410 | ) | |||||
Claims satisfied | (857 | ) | (1,085 | ) | |||||
Total | 761 | 1,151 | |||||||
Less: current portion | (665 | ) | (1,094 | ) | |||||
Long term accrued warranty | $ | 96 | $ | 57 | |||||
For extended warranty on the consumer products, see Revenue Recognition below. | |||||||||
Insurance Reserves | Insurance Reserves | ||||||||
The Company, through its subsidiary LCA-Vision (which is presented as a discontinued operations), maintains a captive insurance company to provide professional liability insurance coverage for claims brought against the Company and its optometrists. In addition, the captive insurance company's charter allows it to provide professional liability insurance for the Company's ophthalmologists, none of whom are currently insured by the captive. The Company uses the captive insurance company for both primary insurance and excess liability coverage. A number of claims are now pending with the captive insurance company. Since the captive insurance company is wholly-owned enterprise, it is included in the Company's consolidated financial statements. As of December 31, 2014, the insurance reserves were $6,044, which represented an actuarially determined estimate of future costs associated with claims filed as well as claims incurred but not yet reported. The actuaries determine loss reserves by comparing the Company's historical claim experience to comparable insurance industry experience. | |||||||||
Revenue Recognition | Revenue Recognition | ||||||||
The Company recognizes revenues from the product sales when the following four criteria have been met: (i) the product has been delivered and the Company has no significant remaining obligations; (ii) persuasive evidence of an arrangement exists; (iii) the price to the buyer is fixed or determinable; and (iv) collection is reasonably assured. Revenues from product sales are recorded net of provisions for estimated chargebacks, rebates, expected returns and cash discounts. | |||||||||
The Company ships most of its products FOB shipping point, although from time to time certain customers, for example governmental customers, will be granted FOB destination terms. Among the factors the Company takes into account when determining the proper time at which to recognize revenue are (i) when title to the goods transfers and (ii) when the risk of loss transfers. Shipments to distributors or physicians that do not fully satisfy the collection criteria are recognized when invoiced amounts are fully paid or fully assured and included in deferred revenues until that time. | |||||||||
For revenue arrangements with multiple deliverables within a single, contractually binding arrangements (usually sales of products with separately priced extended warranty), each element of the contract is accounted for as a separate unit of accounting when it provides the customer value on a stand-alone basis and there is objective evidence of the fair value of the related unit. | |||||||||
With respect to sales arrangements under which the buyer has a right to return the related product, revenue is recognized only if all the following conditions are met: the price is fixed or determinable at the date of sale; the buyer has paid, or is obligated to pay and the obligation is not contingent on resale of the product; the buyer's obligation would not be changed in the event of theft or physical destruction or damage of the product; the buyer has economic substance; the Company does not have significant obligations for future performance to directly bring about resale of the product by the buyer; and the amount of future returns can be reasonably estimated. | |||||||||
The Company provides a provision for product returns based on the experience with historical sales returns, in accordance with ASC Topic 605-15 with respect to sales of product when a right of return exists. Reported revenues are shown net of the returns provision. Such allowance for sales returns is included in Other Accrued Liabilities. (See Note 9). | |||||||||
Deferred revenue includes amounts received with respect to extended warranty maintenance, repairs and other billable services and amounts not yet recognized as revenues. Revenues with respect to such activities are deferred and recognized on a straight-line basis over the duration of the warranty period, the service period or when service is provided, as applicable to each service. | |||||||||
The Company has two distribution channels for its phototherapy treatment equipment. The Company either (i) sells its lasers through a distributor or directly to a physician or (ii) places its lasers in a physician's office (at no charge to the physician) and generally charges the physician a fee for an agreed upon number of treatments. In some cases, the Company and the customer stipulate to a quarterly or other periodic target of procedures to be performed, and accordingly revenue is recognized ratably over the period. | |||||||||
When the Company places a laser in a physician's office, it generally recognizes service revenue based on the number of patient treatments performed, or purchased under a periodic commitment, by the physician. Amounts collected with respect to treatments to be performed through laser-access codes that are sold to physicians free of a periodic commitment, but not yet used, are deferred and recognized as a liability until the physician performs the treatment. Unused treatments remain an obligation of the Company because the treatments can only be performed on Company-owned equipment. Once the treatments are performed, this obligation has been satisfied. | |||||||||
The Company defers substantially all revenue from sales of treatment codes ordered by and performed to its customers within the last two weeks of the period in determining the amount of treatments performed by its physician-customers. Management believes this approach closely approximates the actual amount of unused treatments that existed at the end of a period. | |||||||||
Shipping and Handling Costs | Shipping and Handling Costs | ||||||||
Shipping and handling fees billed to customers are reflected as revenues while the related shipping and handling costs are included in selling and marketing expense. To date, shipping and handling costs have not been material. | |||||||||
Product Development Costs | Product Development Costs | ||||||||
Costs of research, new product development and product redesign are charged to expense as incurred in engineering and product development. | |||||||||
Advertising Costs | Advertising Costs | ||||||||
Advertising costs are charged to expenses as incurred. | |||||||||
Advertising expenses amounted to approximately $62,197, $71,992 and $60,651 for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||||||
Derivatives | Derivatives | ||||||||
The Company applies the provisions of Accounting Standards Codification ("ASC") Topic 815, Derivatives and Hedging. In accordance with ASC Topic 815, all the derivative financial instruments are recognized as either financial assets or financial liabilities on the balance sheet at fair value. The accounting for changes in the fair value of a derivative financial instrument depends on whether it has been designated and qualifies as part of a hedging relationship and further, on the type of hedging relationship. For derivative financial instruments that are designated and qualify as hedging instruments, a company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, cash flow hedge or a hedge of a net investment in a foreign operation. | |||||||||
From time to time the Company carries out transactions involving foreign exchange derivative financial instruments (mainly forward exchange contracts) which are expected to be paid with respect to forecasted expenses of the Israeli subsidiary (Radiancy) denominated in Israeli local currency (NIS) which is different than its functional currency. | |||||||||
Such derivatives were not designated as hedging instruments, and accordingly they were recognized in the balance sheet at their fair value, with changes in the fair value carried to the Statement of Comprehensive (Loss) Income and included in interest and other financing income (expenses), net. | |||||||||
At December 31, 2014, the balance of such derivative instruments amounted to approximately $726 in liabilities and approximately $689 were recognized as financing loss in the Statement of Comprehensive (Loss) Income during the year ended that date. At December 31, 2013, the balance of such derivative instruments amounted to approximately $255 in assets and approximately $699 were recognized as financing income in the Statement of Comprehensive (Loss) Income during the year ended that date. | |||||||||
The notional amounts of foreign currency derivatives as of December 31, 2014 consist of forward transactions for the exchange of $11,000 into NIS and $6,725 as of December 31, 2013. | |||||||||
Income Taxes | Income Taxes | ||||||||
The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured using enacted tax rates and laws that are expected to be in effect when the differences reverse. Any resulting net deferred tax assets are evaluated for recoverability and, accordingly, a valuation allowance is provided when it is more likely than not that all or some portion of the deferred tax asset will not be realized. | |||||||||
The Company may incur an additional tax liability in the event of an intercompany dividend distribution or a deemed dividend distribution under the U.S. income tax law and regulations. Prior to 2014, it was the Company's policy not to cause a distribution of dividends which would generate an additional tax liability to the Company. During 2014, the Company borrowed funds from its subsidiary in Israel. These borrowings resulted in a large deemed distribution taxable in the U.S. Furthermore, Management can no longer represent that the earnings of its non U.S. subsidiaries will remain permanently invested outside the U.S. Therefore, in 2014, the Company has provided deferred taxes on the undistributed earnings of its non U.S. subsidiaries. Taxes, which would apply in the event of disposal of investments in subsidiaries, have not been taken into account in computing the deferred taxes, as it is the Company's policy to hold these investments, not to dispose of them. | |||||||||
The Company accounts for uncertain tax positions in accordance with an amendment to ASC Topic 740-10, Income Taxes (Accounting for Uncertainty in Income Taxes), which clarified the accounting for uncertainty in tax positions. This amendment provides that the tax effects from an uncertain tax position can be recognized in the financial statements only if the position is "more-likely-than-not" to be sustained were it to be challenged by a taxing authority. The assessment of the tax position is based solely on the technical merits of the position, without regard the likelihood that the tax position may be challenged. If an uncertain tax position meets the "more-likely-than-not" threshold, the largest amount of tax benefit that is more than 50% likely to be recognized upon ultimate settlement with the taxing authority is recorded. | |||||||||
In the year ended December 31, 2014, the Company determined that the liability for unrecognized tax benefits could suitably be extinguished by application of net operating loss carryforwards and carrybacks, with any residual impact arising as a liability in 2014 that has been duly provided for. | |||||||||
Concentration of credit risks | Concentration of credit risks | ||||||||
Financial instruments which subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, derivative (assets), accounts receivable and short-term bank deposits. The carrying amounts of these instruments approximate fair value due to their short-term nature. The Company deposits cash and cash equivalents and short term deposits in major financial institutions in the US, UK, Brazil and in Israel. The Company performs periodic evaluations of the relative credit standing of these institutions. The Company is of the opinion that the credit risk in respect of these balances is immaterial. In addition, the Company performs an ongoing credit evaluation and establishes an allowance for doubtful accounts based upon factors surrounding the credit risk of customers (see also Accounts receivable above). | |||||||||
Most of the Company's sales are generated in North America and Asia Pacific, to a large number of customers. Management periodically evaluates the collectability of the trade receivables to determine the amounts that are doubtful of collection and determine a proper allowance for doubtful accounts. Accordingly, the Company's trade receivables do not represent a substantial concentration of credit risk. | |||||||||
Contingencies | Contingencies | ||||||||
The Company and its subsidiaries are involved in certain legal proceedings that arise from time to time in the ordinary course of its business. Except for income tax contingencies, the Company records accruals for contingencies to the extent that the management concludes that the occurrence is probable and that the related amounts of loss can be reasonably estimated. Legal expenses associated with the contingency are expensed as incurred. | |||||||||
Earnings (Loss) Per Share | Earnings (Loss) Per Share | ||||||||
The Company computes earnings (net loss) per share in accordance with ASC Topic. 260, Earnings per share. Basic earnings (loss) per share are computed by dividing net income by the weighted-average number of common shares outstanding during the period, net of the weighted average number of treasury shares. Diluted earnings (loss) per common share are computed similar to basic earnings per share, except that the denominator is increased to include the number of additional potential common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Potential common shares are excluded from the computation for a period in which a net loss is reported or if their effect is anti-dilutive. The Company's potential common shares consist of stock options, warrants and restricted stock awards issued under the Company's stock incentive plans and their potential dilutive effect is considered using the treasury method. | |||||||||
Basic and diluted earnings per common share were calculated using the following weighted average shares outstanding for the years ended December 31, 2014, 2013 and 2012: | |||||||||
December 31, | |||||||||
2014 | 2013 | 2012 | |||||||
Weighted average number of common and common equivalent shares outstanding: | |||||||||
Basic number of common shares outstanding | 18,940,355 | 20,454,970 | 20,355,520 | ||||||
Dilutive effect of stock options and warrants | - | 202,270 | 408,834 | ||||||
Diluted number of common and common stock equivalent shares outstanding | 18,940,355 | 20,657,240 | 20,764,354 | ||||||
Diluted earnings (loss) per share for each of the years ended December 31, 2014, 2013 and 2012 exclude the impact of common stock options, warrants and unvested restricted stock totaling 2,540,733, 2,172,745 and 1,920,442 shares, respectively, as the effect of their inclusion would be anti-dilutive. | |||||||||
Impairment of Long-Lived Assets and Intangibles | Impairment of Long-Lived Assets and Intangibles | ||||||||
Long-lived assets, such as property and equipment, and definite-lived intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the fair value of the asset. If the carrying amount of an asset exceeds the fair value, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. As of December 31, 2014, (other than the measurement of LCA net assets based on it estimated fair value less cost to sell- see Note 2) no such impairment exists. Assets to be disposed of are separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated. The assets and liabilities of a disposed group classified as discontinued operations are presented separately in the appropriate asset and liability sections of the balance sheet. | |||||||||
Indefinite-life intangible assets are tested for impairment, on an annual basis or more often, when triggering events indicate that it is more likely than not that the asset is impaired, by comparing the fair value of the asset with its carrying amount. If the carrying amount of the intangible asset exceeds its fair value, an impairment loss is recognized in the amount of that excess. Subsequent reversal of a previously recognized impairment loss is prohibited. | |||||||||
Share-Based Compensation | Stock-Based Compensation | ||||||||
The Company accounts for stock-based compensation in accordance with ASC Topic 718, Compensation – Stock Compensation. Under the fair value recognition provision, of this statement, share-based compensation cost is measured at the grant date based on the fair value of the award that is ultimately expected to vest and is recognized as operating expense over the applicable vesting period of the stock award using the graded vesting method. | |||||||||
Treasury Stock and Repurchase of Common Stock | Treasury Stock and Repurchase of Common Stock | ||||||||
Shares held by the Company are presented as a reduction of equity, at their cost to the Company as treasury stock, until such shares are retired and removed from the accounts. | |||||||||
Adoption of New Accounting Standards | Adoption of New Accounting Standards | ||||||||
Effective January 1, 2014, the Company adopted Accounting Standard Update 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force) ("ASU 2013-11"). | |||||||||
The amendments in ASU 2013-11 state that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows: To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be presented net of deferred tax assets. | |||||||||
ASU 2013-11 applies to all entities that have unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. For public companies the amendments in this ASU became effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The amendments were applied prospectively to all unrecognized tax benefits that existed at the effective date. | |||||||||
The adoption of the standard did not have a material impact on the Company's consolidated results of operations and financial condition. | |||||||||
Effective January 1, 2014, the Company adopted Accounting Standards Update 2013-5, Foreign Currency Matters (Topic 830) Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity ("ASU 2013-5"). | |||||||||
ASU 2013-5 clarifies that, when a reporting entity (parent) ceases to have a controlling financial interest in a subsidiary or group of assets that is a business (other than a sale of in-substance real estate or conveyance of oil and gas mineral rights) within a foreign entity, the parent is required to apply the guidance in Subtopic 830-30 to release any related cumulative translation adjustment into net income. Accordingly, the cumulative translation adjustment should be released into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. ASU 2013-5 also clarifies that if the business combination achieved in stages relates to a previously held equity method investment (step-acquisition) that is a foreign entity, the amount of accumulated other comprehensive income that is reclassified and included in the calculation of gain or loss shall include any foreign currency translation adjustment related to that previously held investment. | |||||||||
For public companies, the amendments in this Update became effective prospectively for fiscal years (and interim reporting periods within those years) beginning after December 15, 2013. In accordance with the transition requirements, the amendments were applied prospectively to derecognition events occurring after the effective date. Prior periods are not required be adjusted. | |||||||||
The adoption of the standard did not have a material impact on the Company's consolidated results of operations and financial condition. | |||||||||
Recently Issued Accounting Standards | Recently Issued Accounting Standards | ||||||||
In April 2014, the FASB issued Accounting Standard Update 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity ("ASU 2014-08"). | |||||||||
The amendments in ASU 2014-08 change the criteria for reporting discontinued operations while enhancing disclosures in this area. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. Those strategic shifts should have a major effect on the organization's operations and financial results. In addition, the new guidance requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. | |||||||||
The amendments in ASU 2014-08 are effective in the first quarter of 2015 for public companies with calendar year ends. Early adoption is permitted. | |||||||||
The adoption of ASU 2014-08 is not expected to have a material impact on the Company's consolidated results of operations and financial condition. | |||||||||
In May 2014, The FASB issued Accounting Standard Update 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"). | |||||||||
ASU 2014-09 outlines a single comprehensive model to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASU 2014-09 also requires entities to disclose sufficient information, both quantitative and qualitative, to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. | |||||||||
An entity should apply the amendments in this ASU using one of the following two methods: 1. Retrospectively to each prior reporting period presented with a possibility to elect certain practical expedients, or, 2. Retrospectively with the cumulative effect of initially applying ASU 2014-09 recognized at the date of initial application. If an entity elects the latter transition method, it also should provide certain additional disclosures. | |||||||||
For a public entity, the amendments in ASU 2014-09 are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period (the first quarter of fiscal year 2017 for the Company). Early application is not permitted. The Company is in the process of assessing the impact, if any, of ASU 2014-09 on its consolidated financial statements. | |||||||||
In August 2014, the FASB issued Accounting Standards Update 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern ("ASU 2014-15"). ASU 2014-15 provide guidance on management's responsibility in evaluating whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable). ASU 2014-15 also provide guidance related to the required disclosures as a result of management evaluation. | |||||||||
The amendments in ASU 2014-15 are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. |
The_Company_and_Summary_of_Sig2
The Company and Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
The Company and Summary of Significant Accounting Policies [Abstract] | |||||||||
Activity in the warranty accrual | The activity in the warranty accrual during the years ended December 31, 2014 and 2013 is summarized as follows: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Accrual at beginning of year | $ | 1,151 | $ | 1,440 | |||||
Additions charged to warranty expense | 808 | 1,206 | |||||||
Expiring warranties | (341 | ) | (410 | ) | |||||
Claims satisfied | (857 | ) | (1,085 | ) | |||||
Total | 761 | 1,151 | |||||||
Less: current portion | (665 | ) | (1,094 | ) | |||||
Long term accrued warranty | $ | 96 | $ | 57 | |||||
Calculation of basic and diluted earnings per common share using weighted average shares outstanding | Basic and diluted earnings per common share were calculated using the following weighted average shares outstanding for the years ended December 31, 2014, 2013 and 2012: | ||||||||
December 31, | |||||||||
2014 | 2013 | 2012 | |||||||
Weighted average number of common and common equivalent shares outstanding: | |||||||||
Basic number of common shares outstanding | 18,940,355 | 20,454,970 | 20,355,520 | ||||||
Dilutive effect of stock options and warrants | - | 202,270 | 408,834 | ||||||
Diluted number of common and common stock equivalent shares outstanding | 18,940,355 | 20,657,240 | 20,764,354 |
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Discontinued Operations [Abstract] | |||||
Summary of assets and liabilities held for sale in the consolidated balance sheet | The following is a summary of assets and liabilities held for sale in the consolidated balance sheet as of December 31, 2014: | ||||
31-Dec-14 | |||||
Assets: | |||||
Cash and cash equivalents | $ | 4,514 | |||
Accounts receivable | 2,759 | ||||
Inventories | 119 | ||||
Deferred tax assets | 1,930 | ||||
Other current assets | 2,492 | ||||
Property & Equipment, net | 14,519 | ||||
Goodwill, net | 6,491 | ||||
Other intangible assets, net | 38,331 | ||||
Other assets | 1,207 | ||||
Assets held for sale | 72,362 | ||||
Less: Impairment | (1,507 | ) | |||
Assets held for sale, net | $ | 70,855 | |||
Liabilities: | |||||
Accounts payable | $ | 5,518 | |||
Other accrued liabilities | 5,933 | ||||
Deferred revenues | 97 | ||||
Long term debt: | 1,080 | ||||
Other liabilities | 6,870 | ||||
Deferred tax liability | 14,999 | ||||
Liabilities held for sale | 34,497 | ||||
Total net assets of discontinued operations | $ | 36,358 |
Acquisition_Tables
Acquisition (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Acquisition [Abstract] | |||||
Schedule of Aggregate Consideration Paid | The purchase price of LCA-Vision was $106,552 in aggregate consideration, paid in cash (including the full use of the credit facility), consisting of: | ||||
Fair value LCA-Vision stock (A) | $ | 103,896 | |||
Fair value of LCA-Vision restricted stock units, including payroll taxes (B) | 2,656 | ||||
Total purchase price | $ | 106,552 | |||
A. | Based on 19,347,554 outstanding shares of LCA-Vision common stock at May 12, 2014. | ||||
B. | Based on 476,436 outstanding or deemed to be outstanding restricted stock units of LCA-Vision common stock at May 12, 2014. | ||||
Purchase Price Allocation | Basedon the purchase price allocation, the following table summarizes the provisional fair value amounts of the assets acquired and liabilities assumed at the date of acquisition: | ||||
Cash and cash equivalents | $ | 29,042 | |||
Current assets, excluding cash and cash equivalents | 6,114 | ||||
Deferred tax asset, current | 1,124 | ||||
Property, plant and equipment | 17,269 | ||||
Identifiable intangible assets | 39,050 | ||||
Other assets | 1,518 | ||||
Total assets acquired at fair value | 94,117 | ||||
Current liabilities | (19,009 | ) | |||
Long-term debt | (1,603 | ) | |||
Deferred tax liability, long-term | (9,138 | ) | |||
Other long-term liabilities | (7,397 | ) | |||
Total liabilities assumed | (37,147 | ) | |||
Net assets acquired | $ | 56,970 |
Inventories_Tables
Inventories (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Inventories [Abstract] | |||||||||
Schedule of inventories | Inventories: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Raw materials and work-in-process | $ | 7,483 | $ | 12,631 | |||||
Finished goods | 11,897 | 14,916 | |||||||
Total inventories | $ | 19,380 | $ | 27,547 |
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property and Equipment [Abstract] | |||||||||
Schedule property and equipment | Property and Equipment: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Lasers-in-service | $ | 18,974 | $ | 12,599 | |||||
Equipment, computer hardware and software | 4,870 | 4,730 | |||||||
Furniture and fixtures | 767 | 705 | |||||||
Leasehold improvements | 481 | 534 | |||||||
25,092 | 18,568 | ||||||||
Accumulated depreciation and amortization | (11,290 | ) | (8,079 | ) | |||||
Total property and equipment, net | $ | 13,802 | $ | 10,489 |
Patents_and_Licensed_Technolog1
Patents and Licensed Technologies, net (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Patents and Licensed Technologies, net [Abstract] | |||||||||
Schedule of patents and licensed technologies | Patents and Licensed Technologies, net: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Gross Amount beginning of period | $ | 15,648 | $ | 15,411 | |||||
Additions | 168 | 171 | |||||||
Translation differences | (190 | ) | 66 | ||||||
Gross Amount end of period | 15,626 | 15,648 | |||||||
Accumulated amortization | (6,815 | ) | (4,816 | ) | |||||
Net Book Value | $ | 8,811 | $ | 10,832 | |||||
Amortization expense for amortizable patents and licensed technologies | Estimated amortization expense for amortizable patents and licensed technologies assets for the next five years is as follows: | ||||||||
2015 | $ | 2,056 | |||||||
2016 | 2,019 | ||||||||
2017 | 903 | ||||||||
2018 | 906 | ||||||||
2019 | 892 | ||||||||
Thereafter | 2,035 | ||||||||
Total | $ | 8,811 |
Goodwill_and_Other_Intangible_1
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Goodwill and Other Intangible Assets [Abstract] | |||||||||||||||||||||||||
Schedule of goodwill acquired | The purchase price intrinsically recognizes the benefits of the broadened depth of the management team and the addition of a sizeable direct sales force creating greater access to the physician community with branded products and technologies. Furthermore, the purchase price paid by Radiancy, Inc., a private company includes, among other things, other benefits such as the intrinsic value of being a Nasdaq-listed issuer post merger and now having access to capital markets and stockholder liquidity. | ||||||||||||||||||||||||
Balance at January 1, 2014 | $ | 24,930 | |||||||||||||||||||||||
Additions to goodwill | - | ||||||||||||||||||||||||
Translation differences | (882 | ) | |||||||||||||||||||||||
Balance at December 31, 2014 | $ | 24,048 | |||||||||||||||||||||||
Schedule of goodwill allocated to reportable segments | The goodwill was allocated among the reportable segments as of December 31, 2014 in accordance with the provisions of ASC Topic 350-20 Intangibles-Goodwill and consisted of the following: | ||||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||
Consumer segment | $ | 19,968 | |||||||||||||||||||||||
Physician Recurring segment | 4,080 | ||||||||||||||||||||||||
Total goodwill | $ | 24,048 | |||||||||||||||||||||||
Schedule of other definite-lived intangible assets | Set forth below is a detailed listing of other definite-lived intangible assets: | ||||||||||||||||||||||||
31-Dec-14 | 31-Dec-13 | ||||||||||||||||||||||||
Trademarks | Customer Relationships | Total | Trademarks | Customer Relationships | Total | ||||||||||||||||||||
Gross Amount beginning of period | $ | 5,772 | $ | 6,417 | $ | 12,189 | $ | 5,744 | $ | 6,372 | $ | 12,116 | |||||||||||||
Translation differences | (80 | ) | (128 | ) | (208 | ) | 28 | 45 | 73 | ||||||||||||||||
Gross Amount end of period | 5,692 | 6,289 | 11,981 | 5,772 | 6,417 | 12,189 | |||||||||||||||||||
Accumulated amortization | (1,731 | ) | (1,913 | ) | (3,644 | ) | (1,178 | ) | (1,310 | ) | (2,488 | ) | |||||||||||||
Net Book Value | $ | 3,961 | $ | 4,376 | $ | 8,337 | $ | 4,594 | $ | 5,107 | $ | 9,701 | |||||||||||||
Schedule of estimated amortization expense for amortizable intangible assets | Estimated amortization expense for the above amortizable intangible assets for the next five years is as follows: | ||||||||||||||||||||||||
2015 | $ | 1,200 | |||||||||||||||||||||||
2016 | 1,200 | ||||||||||||||||||||||||
2017 | 1,200 | ||||||||||||||||||||||||
2018 | 1,200 | ||||||||||||||||||||||||
2019 | 1,200 | ||||||||||||||||||||||||
Thereafter | 2,337 | ||||||||||||||||||||||||
Total | $ | 8,337 |
Accrued_Compensation_and_relat1
Accrued Compensation and related expenses (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accrued Compensation and related expenses [Abstract] | |||||||||
Schedule of accrued compensation and related expenses | Accrued Compensation and related expenses: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Accrued payroll and related taxes | $ | 513 | $ | 707 | |||||
Accrued vacation | 211 | 290 | |||||||
Accrued commissions and bonuses | 1,898 | 2,233 | |||||||
Total accrued compensation and related expense | $ | 2,622 | $ | 3,230 |
Other_Accrued_Liabilities_Tabl
Other Accrued Liabilities (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Other Accrued Liabilities [Abstract] | |||||||||
Schedule of other accrued liabilities | Other Accrued Liabilities: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Accrued warranty, current, see Note 1 | $ | 665 | $ | 1,094 | |||||
Accrued taxes, including liability for unrecognized tax benefit, see Note 13 | 1,362 | 1,023 | |||||||
Accrued sales return (1) | 7,651 | 16,046 | |||||||
Other accrued liabilities | 3,344 | 3,869 | |||||||
Total other accrued liabilities | $ | 13,022 | $ | 22,032 | |||||
-1 | The activity in the sales returns liability account was as follows: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Balance at beginning of year | $ | 16,046 | $ | 11,901 | |||||
Additions that reduce net sales | 35,771 | 47,916 | |||||||
Actual returns | (44,166 | ) | (43,771 | ) | |||||
Balance at end of year | $ | 7,651 | $ | 16,046 |
Longterm_Debt_Tables
Long-term Debt (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Long-term Debt [Abstract] | |||||||||
Schedule of Long-term Debt | In the following table is a summary of the Company's long-term debt: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Senior-secured credit facilities | $ | 76,500 | $ | - | |||||
Term note | - | 10,000 | |||||||
Sub-total | 76,500 | 10,000 | |||||||
Less: current portion | 38,732 | 10,000 | |||||||
Long-term debt | $ | 37,768 | $ | - | |||||
Future Minimum Payment for Long-term Debt | The following table summarizes the future minimum payments that the Company expects to make for long-term debt: | ||||||||
2015 | $ | 38,732 | |||||||
2016 | 37,768 | ||||||||
$ | 76,500 |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Commitments and Contingencies [Abstract] | |||||
Schedule of future annual lease payments under leases, relating to continuing operations | The future annual minimum payments under these leases, relating to our continuing operations are as follows: | ||||
Year Ending December 31, | |||||
2015 | $ | 814 | |||
2016 | 472 | ||||
2017 | 176 | ||||
Thereafter | 366 | ||||
Total | $ | 1,828 |
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Stockholders' Equity [Abstract] | ||||||
Stock option activity under share-based compensation plans | A summary of option transactions for all of the Company's stock options during the years ended December 31, 2014, 2013 and 2012 follows: | |||||
Number of Stock Options | Weighted Average Exercise Price | |||||
Outstanding at December 31, 2011 | 180,718 | $19.54 | ||||
Granted | 739,000 | 15.87 | ||||
Exercised | -10,048 | 6.67 | ||||
Expired/cancelled | -11,129 | 20.25 | ||||
Outstanding at December 31, 2012 | 898,541 | 16.65 | ||||
Granted | 259,625 | 16.59 | ||||
Exercised | -3,750 | 6.24 | ||||
Expired/cancelled | -21,738 | 31.36 | ||||
Outstanding at December 31, 2013 | 1,132,678 | 16.51 | ||||
Granted | 181,500 | 14.1 | ||||
Exercised | - | - | ||||
Expired/cancelled | -154,624 | 15.73 | ||||
Outstanding at December 31, 2014 | 1,159,554 | $16.23 | ||||
Exercisable at December 31, 2014 | 510,954 | $16.47 | ||||
Schedule of outstanding and exercisable options | The outstanding and exercisable options at December 31, 2014, have a range of exercise prices and associated weighted remaining contractual life and weighted average exercise price, as follows: | |||||
Weighted Average Remaining Contractual Life (years) | ||||||
Options Range of Exercise Prices | Outstanding Number of Shares | Weighted Average Exercise Price | Exercisable Number of Shares | Exercisable Weighted Avg. Exercise Price | ||
$0 - $7.50 | 21,584 | 4.58 | $ 6.12 | 21,584 | $ 6.11 | |
$7.51 - $15.00 | 699,622 | 7.85 | $ 14.11 | 255,022 | $ 13.93 | |
$15.01 - $22.50 | 427,900 | 7.32 | $ 19.02 | 223,900 | $ 18.13 | |
$22.51- up | 10,448 | 1.56 | $ 64.42 | 10,448 | $ 64.42 | |
Total | 1,159,554 | 7.54 | $ 16.23 | 510,954 | $ 16.47 | |
Schedule of outstanding options | The outstanding options will expire, as follows: | |||||
Year Ending | Number of Shares | Weighted Average Exercise Price | ||||
Exercise Price | ||||||
2015 | 2,499 | $102.90 | $102.90 | |||
2016 | 2,634 | $69.48 | $48.72 - $93.66 | |||
2017 | 3,146 | $46.85 | $46.62 - $47.88 | |||
2018 | 2,169 | $39.41 | $37.80 - $39.90 | |||
2019 and later | 1,149,106 | $15.79 | $5.70 - $20.00 | |||
1,159,554 | $16.23 | $5.70 - $102.90 | ||||
Weighted average assumptions used to estimate fair value of stock options | The Company uses the Black-Scholes option-pricing model to estimate fair value of grants of stock options with the following weighted average assumptions: | |||||
Year Ended December 31, | ||||||
2014 | 2013 | 2012 | ||||
Risk-free interest rate | 2.17% | 1.30% | N/A | |||
Volatility | 78.41% | 85.25% | N/A | |||
Expected dividend yield | 0% | 0% | N/A | |||
Expected life | 5.5 years | 5.5 years | N/A | |||
Estimated forfeiture rate | 0% | 0% | N/A | |||
Summary of warrant transactions | A summary of warrant transactions for the years ended December 31, 2014, 2013 and 2012 follows: | |||||
Weighted Average | ||||||
Exercise Price | ||||||
Number of Warrants | ||||||
Outstanding at January 1, 2012 | 1,067,240 | $19.98 | ||||
Issued | 25,000 | 20 | ||||
Exercised | -17,756 | 7.5 | ||||
Expired/cancelled | -11,216 | 47.04 | ||||
Outstanding at December 31, 2012 | 1,063,268 | 19.91 | ||||
Issued | - | - | ||||
Exercised | - | - | ||||
Expired/cancelled | -4,589 | 18.48 | ||||
Outstanding at December 31, 2013 | 1,058,679 | 19.91 | ||||
Issued | 322,500 | 2.25 | ||||
Exercised | - | - | ||||
Expired/cancelled | - | - | ||||
Outstanding at December 31, 2014 | 1,381,179 | $15.79 | ||||
Summary of warrant transactions expiration period | If not previously exercised, the outstanding warrants will expire as follows: | |||||
Weighted Average | ||||||
Exercise Price | ||||||
Year Ending December 31, | Number of Warrants | |||||
2015 | 32,250 | $17.19 | ||||
2016 | 1,026,429 | 20 | ||||
2017 | 322,500 | 2.25 | ||||
1,381,179 | $15.79 |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Taxes [Abstract] | |||||||||||||
Components of income before income taxes from continuing operations and the provision for income taxes | For the years ended December 31, 2014, 2013, and 2012, the following table summarizes the components of income before income taxes from continuing operations and the provision for income taxes: | ||||||||||||
Year Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Income (loss) before income tax: | |||||||||||||
U.S. | $ | (25,398 | ) | $ | 7,700 | $ | 3,152 | ||||||
Israel | 1,780 | 14,279 | 20,410 | ||||||||||
Other Foreign | (1,813 | ) | 768 | 3,365 | |||||||||
Income (loss) before income taxes | $ | (25,431 | ) | $ | 22,747 | $ | 26,927 | ||||||
Income tax expense (benefit): | |||||||||||||
United States - Federal tax: | |||||||||||||
Current | $ | (1,030 | ) | $ | (1,253 | ) | $ | 2,752 | |||||
Deferred | 34,117 | 1,795 | (1,572 | ) | |||||||||
United States - State tax: | |||||||||||||
Current | 195 | 180 | 315 | ||||||||||
Deferred: | 245 | 850 | (2,074 | ) | |||||||||
Israel: | |||||||||||||
Current | 1,431 | 2,781 | 4,034 | ||||||||||
Deferred | (190 | ) | (237 | ) | (50 | ) | |||||||
Other foreign: | |||||||||||||
Current | 81 | 54 | 1371 | ||||||||||
Deferred: | 1,463 | 200 | (338 | ) | |||||||||
Income tax expense | $ | 36,312 | $ | 4,370 | $ | 4,438 | |||||||
Reconciliation of the federal statutory income tax rate to the effective income tax rate | For the years ended December 31, 2014, 2013 and 2012, the following table reconciles the federal statutory income tax rate to the effective income tax rate: | ||||||||||||
Year Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Federal Tax rate | 34 | % | 34 | % | 34 | % | |||||||
Federal tax expense (benefit) at 34% | $ | (9,349 | ) | $ | 7,733 | $ | 9,157 | ||||||
State and local income tax, net of Federal benefit | 373 | 958 | 286 | ||||||||||
Foreign rate differential | (483 | ) | (2,404 | ) | (3,962 | ) | |||||||
Increase in taxes from permanent differences in stock-based compensation | 330 | 420 | 618 | ||||||||||
US taxation of foreign earnings – Subpart F | 11,571 | 357 | 403 | ||||||||||
Increase (decrease) in uncertain tax positions | - | 269 | (2,325 | ) | |||||||||
Return to provision and other adjustments | 301 | (1,963 | ) | - | |||||||||
Impact of tax rate change on deferred taxes | 724 | (942 | ) | - | |||||||||
Foreign tax credits | (7,041 | ) | (341 | ) | - | ||||||||
Tax on foreign exchange | 1,578 | - | - | ||||||||||
Tax on undistributed earnings | 3,333 | - | - | ||||||||||
Change in valuation allowance | 34,695 | 116 | - | ||||||||||
Other, net | 280 | 167 | 261 | ||||||||||
Income tax expense | $ | 36,312 | $ | 4,370 | $ | 4,438 | |||||||
Components of deferred income tax assets and liabilities | The following table summarizes the components of deferred income tax assets and (liabilities): | ||||||||||||
December 31, | |||||||||||||
2014 | 2013 | ||||||||||||
Loss carryforwards | $ | 39,217 | $ | 21,092 | |||||||||
AMT credits | 112 | 112 | |||||||||||
Foreign tax credits | 7,066 | - | |||||||||||
Accrued employment expenses | 1,785 | 1,256 | |||||||||||
Amortization and write-offs | 9,480 | 8,883 | |||||||||||
Capitalized R&D costs | 2,663 | 2,933 | |||||||||||
Deferred revenues | - | 84 | |||||||||||
Depreciation | 2,022 | 4,360 | |||||||||||
Doubtful accounts | 4,177 | 3,499 | |||||||||||
Inventory reserves | 1,030 | 822 | |||||||||||
Tax on undistributed earnings | (3,333 | ) | - | ||||||||||
Other accruals and reserves | 324 | 228 | |||||||||||
Return allowances | 2,787 | 5,660 | |||||||||||
Translation adjustments | -44 | 61 | |||||||||||
Gross deferred tax asset | 67,286 | 48,990 | |||||||||||
Less: valuation allowance | (65,957 | ) | (11,910 | ) | |||||||||
Net deferred tax asset | $ | 1,329 | $ | 37,080 | |||||||||
Among current assets | $ | 762 | $ | 13,041 | |||||||||
Among other non-current assets | 567 | 24,039 | |||||||||||
Reconciliation of the beginning and ending amount of unrecognized tax benefits | Reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | ||||||||||||
Balance at January 1, 2012 | $ | 2,700 | |||||||||||
Additions / Settlements during 2012 | (2,325 | ) | |||||||||||
Balance December 31, 2012 | 375 | ||||||||||||
Additions/ Settlements due 2013 | 269 | ||||||||||||
Balance at December 31, 2013 | 644 | ||||||||||||
Additions / Settlements due 2014 | - | ||||||||||||
Balance at December 31, 2014 | $ | 644 |
Business_Segment_and_Geographi1
Business Segment and Geographic Data (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Business Segment and Geographic Data [Abstract] | |||||||||||||||||
Results of operations from business segments | The following tables reflect results of operations from our business segments for the periods indicated below: | ||||||||||||||||
Year ended December 31, 2014 | |||||||||||||||||
CONSUMER | PHYSICIAN RECURRING | PROFESSIONAL | TOTAL | ||||||||||||||
Revenues | $ | 120,931 | $ | 34,240 | $ | 8,370 | $ | 163,541 | |||||||||
Costs of revenues | 20,307 | 12,718 | 5,594 | 38,619 | |||||||||||||
Gross profit | 100,624 | 21,522 | 2,776 | 124,922 | |||||||||||||
Gross profit % | 83.2 | % | 62.9 | % | 33.2 | % | 76.4 | % | |||||||||
Allocated operating expenses: | |||||||||||||||||
Engineering and product development | 1,105 | 1,177 | 804 | 3,086 | |||||||||||||
Selling and marketing expenses | 89,637 | 16,347 | 1,185 | 107,169 | |||||||||||||
Unallocated operating expenses | - | - | - | 35,711 | |||||||||||||
90,742 | 17,524 | 1,989 | 145,966 | ||||||||||||||
Income (loss) from continuing operations | 9,882 | 3,998 | 787 | (21,044 | ) | ||||||||||||
Interest and other financing expense, net | - | - | - | (4,387 | ) | ||||||||||||
Income (loss) from continuing operations before taxes | $ | 9,882 | $ | 3,998 | $ | 787 | $ | (25,431 | ) | ||||||||
Year ended December 31, 2013 | |||||||||||||||||
CONSUMER | PHYSICIAN RECURRING | PROFESSIONAL | TOTAL | ||||||||||||||
Revenues | $ | 188,259 | $ | 28,548 | $ | 7,857 | $ | 224,664 | |||||||||
Costs of revenues | 26,794 | 13,022 | 5,219 | 45,035 | |||||||||||||
Gross profit | 161,465 | 15,526 | 2,638 | 179,629 | |||||||||||||
Gross profit % | 85.8 | % | 54.4 | % | 33.6 | % | 80 | % | |||||||||
Allocated operating expenses: | |||||||||||||||||
Engineering and product development | 1,100 | 1,371 | 835 | 3,306 | |||||||||||||
Selling and marketing expenses | 112,898 | 12,681 | 1,949 | 127,528 | |||||||||||||
Unallocated operating expenses | - | - | - | 26,750 | |||||||||||||
113,998 | 14,052 | 2,784 | 157,584 | ||||||||||||||
Income (loss) from operations | 47,467 | 1,474 | (146 | ) | 22,045 | ||||||||||||
Interest and other financing income, net | - | - | - | 702 | |||||||||||||
Net income (loss) before taxes | $ | 47,467 | $ | 1,474 | $ | (146 | ) | $ | 22,747 | ||||||||
Year ended December 31, 2012 | |||||||||||||||||
CONSUMER | PHYSICIAN RECURRING | PROFESSIONAL | TOTAL | ||||||||||||||
Revenues | $ | 188,425 | $ | 21,284 | $ | 10,942 | $ | 220,651 | |||||||||
Costs of revenues | 28,965 | 11,512 | 6,165 | 46,642 | |||||||||||||
Gross profit | 159,460 | 9,772 | 4,777 | 174,009 | |||||||||||||
Gross profit % | 84.6 | % | 45.9 | % | 43.7 | % | 78.9 | % | |||||||||
Allocated operating expenses: | |||||||||||||||||
Engineering and product development | 876 | 1,201 | 837 | 2,914 | |||||||||||||
Selling and marketing expenses | 102,736 | 10,203 | 3,548 | 116,487 | |||||||||||||
Unallocated operating expenses | - | - | - | 27,330 | |||||||||||||
103,612 | 11,404 | 4,385 | 146,731 | ||||||||||||||
Income (loss) from operations | 55,848 | (1,632 | ) | 392 | 27,278 | ||||||||||||
Interest and other financing expense, net | - | - | - | (351 | ) | ||||||||||||
Net income (loss) before taxes | $ | 55,848 | $ | (1,632 | ) | $ | 392 | $ | 26,927 | ||||||||
Net revenues and long-lived assets by geographical area | For the years ended December 31, 2014, 2013 and 2012, net revenues by geographic area (determined by ship to locations) were as follows: | ||||||||||||||||
Year Ended December 31, | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
North America 1 | $ | 123,161 | $ | 174,850 | $ | 163,973 | |||||||||||
Asia Pacific 2 | 9,870 | 19,081 | 28,031 | ||||||||||||||
Europe (including Israel) | 29,227 | 27,849 | 25,521 | ||||||||||||||
South America | 1,283 | 2,884 | 3,126 | ||||||||||||||
$ | 163,541 | $ | 224,664 | $ | 220,651 | ||||||||||||
1 United States | $ | 109,203 | $ | 149,713 | $ | 135,950 | |||||||||||
1 Canada | $ | 13,953 | $ | 25,137 | $ | 28,023 | |||||||||||
2 Japan | $ | 1,750 | $ | 12,226 | $ | 21,134 | |||||||||||
For the years ended December 31, 2014, 2013 and 2012, long-lived assets by geographic area were as follows: | |||||||||||||||||
Year Ended December 31, | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
North America | $ | 12,385 | $ | 9,119 | $ | 5,772 | |||||||||||
Asia Pacific | 286 | - | - | ||||||||||||||
Europe (including Israel) | 1,127 | 1,370 | 987 | ||||||||||||||
South America | 4 | - | - | ||||||||||||||
$ | 13,802 | $ | 10,489 | $ | 6,759 |
Quarterly_Financial_Data_Unaud1
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Quarterly Financial Data (Unaudited) [Abstract] | |||||||||||||||||
Schedule of quarterly financial information | Quarterly Financial Data (Unaudited): | ||||||||||||||||
For the Quarter Ended | |||||||||||||||||
2014 | Mar. 31 | Jun. 30* | Sep. 30* | Dec. 31 | |||||||||||||
Revenues | $ | 50,075 | $ | 38,977 | $ | 35,611 | $ | 38,878 | |||||||||
Gross profit | 39,730 | 30,208 | 26,896 | 28,088 | |||||||||||||
Net loss | (345 | ) | (7,480 | ) | (14,943 | ) | (98,726 | ) | |||||||||
Net loss per share: | |||||||||||||||||
Basic | $ | (0.02 | ) | $ | (0.40 | ) | $ | (0.80 | ) | $ | (5.20 | ) | |||||
Diluted | $ | (0.02 | ) | $ | (0.40 | ) | $ | (0.80 | ) | $ | (5.20 | ) | |||||
Shares used in computing net loss per share: | |||||||||||||||||
Basic | 18,719,419 | 18,723,484 | 18,724,419 | 19,041,451 | |||||||||||||
Diluted | 18,719,419 | 18,723,484 | 18,724,419 | 19,041,451 | |||||||||||||
2013 | Mar. 31 | Jun. 30 | Sep. 30 | Dec. 31 | |||||||||||||
Revenues | $ | 57,216 | $ | 58,065 | $ | 45,893 | $ | 63,490 | |||||||||
Gross profit | 45,350 | 46,675 | 36,827 | 50,777 | |||||||||||||
Net income | 7,212 | 7,094 | 886 | 3,185 | |||||||||||||
Net income per share: | |||||||||||||||||
Basic | $ | 0.35 | $ | 0.34 | $ | 0.04 | $ | 0.16 | |||||||||
Diluted | $ | 0.34 | $ | 0.34 | $ | 0.04 | $ | 0.16 | |||||||||
Shares used in computing net income per share: | |||||||||||||||||
Basic | 20,678,023 | 20,573,048 | 19,982,967 | 19,400,341 | |||||||||||||
Diluted | 21,147,583 | 21,033,349 | 20,441,262 | 19,602,611 | |||||||||||||
2012 | Mar. 31 | Jun. 30 | Sep. 30 | Dec. 31 | |||||||||||||
Revenues | $ | 50,273 | $ | 58,906 | $ | 56,681 | $ | 54,791 | |||||||||
Gross profit | 39,039 | 46,551 | 45,400 | 43,019 | |||||||||||||
Net income | 4,857 | 4,213 | 7,525 | 5,894 | |||||||||||||
Net income per share: | |||||||||||||||||
Basic | $ | 0.26 | $ | 0.2 | $ | 0.35 | $ | 0.28 | |||||||||
Diluted | $ | 0.26 | $ | 0.2 | $ | 0.35 | $ | 0.27 | |||||||||
Shares used in computing net income per share: | |||||||||||||||||
Basic | 18,339,977 | 20,547,244 | 21,205,675 | 20,947,985 | |||||||||||||
Diluted | 18,876,163 | 21,034,814 | 21,752,845 | 21,356,819 | |||||||||||||
*The information has been retroactively adjusted to account for the LCA business which is classified as held for sale as of December 31, 2014, as a discontinued operations. |
Valuation_and_Qualifying_Accou1
Valuation and Qualifying Accounts (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | |||||||||||||||||||||
Valuation and qualifying accounts | Valuation and Qualifying Accounts: | ||||||||||||||||||||
Additions Charged to | |||||||||||||||||||||
Balance at Beginning of Period | Cost and Expenses | Other Accounts | Deductions (1) | Balance at End of Period | |||||||||||||||||
Description | |||||||||||||||||||||
For The Year Ended December 31, 2014: | |||||||||||||||||||||
Allowance for Doubtful Accounts | $ | 10,734 | $ | 7,661 | $ | - | $ | (4,836 | ) | $ | 13,559 | ||||||||||
Allowance for Sales Returns | $ | 16,046 | $ | 35,771 | $ | - | $ | (44,166 | ) | $ | 7,651 | ||||||||||
For The Year Ended December 31, 2013: | |||||||||||||||||||||
Allowance for Doubtful Accounts | $ | 6,917 | $ | 5,958 | $ | - | $ | (2,141 | ) | $ | 10,734 | ||||||||||
Allowance for Sales Returns | $ | 11,901 | $ | 47,916 | $ | - | $ | (43,771 | ) | $ | 16,046 | ||||||||||
For The Year Ended December 31, 2012: | |||||||||||||||||||||
Allowance for Doubtful Accounts | $ | 3,196 | $ | 4,629 | $ | - | $ | (908 | ) | $ | 6,917 | ||||||||||
Allowance for Sales Returns | $ | 6,143 | $ | 43,284 | $ | - | $ | (37,526 | ) | $ | 11,901 | ||||||||||
-1 | Represents write-offs of specific accounts receivable or actual returns, as applicable. |
The_Company_and_Summary_of_Sig3
The Company and Summary of Significant Accounting Policies (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Jan. 31, 2015 | |||
Channel | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Effective date of merger | 13-Dec-11 | |||||||||||||||||
Business sale anticipated | 12 months | |||||||||||||||||
Minimum Collection Period Of Patient Receivables | 12 months | |||||||||||||||||
Maximum Collection Period Of Patient Receivables | 36 months | |||||||||||||||||
Patient Receivables, Finance and interest charges | $507 | |||||||||||||||||
Insurance Reserves | 6,044 | 6,044 | ||||||||||||||||
Cash and Cash Equivalents [Abstract] | ||||||||||||||||||
Short term investment maturity period | 3 months | 3 months | ||||||||||||||||
Accounts Receivable [Abstract] | ||||||||||||||||||
Accounts receivable minimum maturity period | 30 days | |||||||||||||||||
Accounts Receivable maximum maturity period | 90 days | |||||||||||||||||
Property and Equipment [Abstract] | ||||||||||||||||||
Estimated useful life | 5 years | |||||||||||||||||
Other Intangible Assets [Abstract] | ||||||||||||||||||
Other intangible assets useful lives | 10 years | |||||||||||||||||
Activity in warranty accrual [Roll Forward] | ||||||||||||||||||
Accrual at beginning of year | 1,151,000 | 1,440,000 | 1,151,000 | 1,440,000 | ||||||||||||||
Additions charged to warranty expense | 808,000 | 1,206,000 | ||||||||||||||||
Expiring warranties | -341,000 | -410,000 | ||||||||||||||||
Claims satisfied | -857,000 | -1,085,000 | ||||||||||||||||
Total | 761,000 | 1,151,000 | 1,440,000 | 761,000 | 1,151,000 | 1,440,000 | ||||||||||||
Less: current portion | -665,000 | -1,094,000 | -665,000 | -1,094,000 | ||||||||||||||
Long term accrued warranty | 96,000 | 57,000 | 96,000 | 57,000 | ||||||||||||||
Revenue Recognition [Abstract] | ||||||||||||||||||
Number of distribution channels | 2 | |||||||||||||||||
Period of sales deferred | 14 days | |||||||||||||||||
Advertising Costs [Abstract] | ||||||||||||||||||
Advertising expenses | 62,197,000 | 71,992,000 | 60,651,000 | |||||||||||||||
Derivatives [Abstract] | ||||||||||||||||||
Balance of derivative instruments | 726,000 | 255,000 | 726,000 | 255,000 | ||||||||||||||
Amount recognized as financing income | 689,000 | 699,000 | ||||||||||||||||
Notional amounts of foreign currency derivatives | 11,000,000 | 6,725,000 | 11,000,000 | 6,725,000 | ||||||||||||||
Income Taxes [Abstract] | ||||||||||||||||||
Income tax benefit percentage realized on examination (in hundredths) | 50.00% | |||||||||||||||||
Weighted average number of common and common equivalent shares outstanding [Abstract] | ||||||||||||||||||
Basic number of common shares outstanding (in shares) | 19,041,451 | 18,724,419 | [1] | 18,723,484 | [1] | 18,719,419 | 19,400,341 | 19,982,967 | 20,573,048 | 20,678,023 | 20,947,985 | 21,205,675 | 20,547,244 | 18,339,977 | 18,940,355 | 20,454,970 | 20,355,520 | |
Dilutive effect of stock options and warrants (in shares) | 0 | 202,270 | 408,834 | |||||||||||||||
Diluted number of common and common stock equivalent shares outstanding (in shares) | 19,041,451 | 18,724,419 | [1] | 18,723,484 | [1] | 18,719,419 | 19,602,611 | 20,441,262 | 21,033,349 | 21,147,583 | 21,356,819 | 21,752,845 | 21,034,814 | 18,876,163 | 18,940,355 | 20,657,240 | 20,764,354 | |
Common stock options and warrants excluded from computation of diluted earnings per share (in shares) | 2,540,733 | 2,172,745 | 1,920,442 | |||||||||||||||
Impairment of Long-Lived Assets and Intangibles [Abstract] | ||||||||||||||||||
Asset impairment | 0 | |||||||||||||||||
Core technology [Member] | ||||||||||||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||||||||||||
Patent costs and licensed technologies useful life | 10 years | |||||||||||||||||
Product technology [Member] | ||||||||||||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||||||||||||
Patent costs and licensed technologies useful life | 5 years | |||||||||||||||||
Minimum [Member] | ||||||||||||||||||
Short-term Deposits [Abstract] | ||||||||||||||||||
Short-term deposits maturity period | 3 months | |||||||||||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||||||||||||
Patent costs and licensed technologies useful life | 8 years | |||||||||||||||||
Warranty on Product Sales [Line Items] | ||||||||||||||||||
Period of warranty on product sales | 1 year | |||||||||||||||||
Extended period of warranty on domestic sale of laser equipment | 3 years | |||||||||||||||||
Minimum [Member] | Computer Equipment [Member] | ||||||||||||||||||
Property and Equipment [Abstract] | ||||||||||||||||||
Estimated useful life | 3 years | |||||||||||||||||
Maximum [Member] | ||||||||||||||||||
Short-term Deposits [Abstract] | ||||||||||||||||||
Short-term deposits maturity period | 1 year | |||||||||||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||||||||||||
Patent costs and licensed technologies useful life | 12 years | |||||||||||||||||
Warranty on Product Sales [Line Items] | ||||||||||||||||||
Period of warranty on product sales | 2 years | |||||||||||||||||
Extended period of warranty on domestic sale of laser equipment | 4 years | |||||||||||||||||
Maximum [Member] | Computer Equipment [Member] | ||||||||||||||||||
Property and Equipment [Abstract] | ||||||||||||||||||
Estimated useful life | 7 years | |||||||||||||||||
Forbearance Agreement [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Repayment period | 0 years 6 months | |||||||||||||||||
Prepayment of Term Loan | 250,000 | 250,000 | ||||||||||||||||
Percentage of exceeded cash on hand to be paid against revolving loans | 100.00% | 100.00% | ||||||||||||||||
Minimum amount of cash specified against payment of revolving loans | 7,000,000 | 7,000,000 | ||||||||||||||||
Possible increase in interest (in hundredths) | 2.00% | |||||||||||||||||
Maximum capital expenditures on medical devices | 100,000 | |||||||||||||||||
Lenders fee | 500,000 | |||||||||||||||||
PhotoMedex, Inc. [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Percentage of ownership on reverse merger (in hundredths) | 20.00% | |||||||||||||||||
LCA-Vision Inc [Member] | Subsequent Event [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Percentage of shares acquired by wholly-owned subsidiary (in hundredths) | 100.00% | |||||||||||||||||
Cash consideration from sale of business | 40,000,000 | |||||||||||||||||
Net proceeds realized from sale of business | 36,500,000 | |||||||||||||||||
Radiancy, Inc. [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Percentage of ownership on reverse merger (in hundredths) | 80.00% | |||||||||||||||||
Senior-secured credit facilities [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | 85,000,000 | 85,000,000 | ||||||||||||||||
Revolving Credit Facility [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | 10,000,000 | 10,000,000 | ||||||||||||||||
Term Loan [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | 75,000,000 | 75,000,000 | ||||||||||||||||
Repayment period | 4 years | |||||||||||||||||
Prepayment of Term Loan | 125,000 | 125,000 | ||||||||||||||||
Minimum amount of cash specified against payment of revolving loans | 5,000,000 | 5,000,000 | ||||||||||||||||
Term Loan [Member] | Maximum [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Outstanding principal amount | 10,000,000 | 10,000,000 | ||||||||||||||||
Fee Payment Each Month For May and June 2015 [Member] | Forbearance Agreement [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Lenders fee | 750,000 | |||||||||||||||||
Fee Payment Each Month For July Through September 2015 [Member] | Forbearance Agreement [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Lenders fee | 1,000,000 | |||||||||||||||||
Fee Payment Each Month For October Through December 2015 [Member] | Forbearance Agreement [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Lenders fee | 1,250,000 | |||||||||||||||||
Fee Payment Each Month For January Through March 2016 [Member] | Forbearance Agreement [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Lenders fee | $1,500,000 | |||||||||||||||||
CB Floating Rate [Member] | Forbearance Agreement [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Effective interest rate (in hundredths) | 4.00% | |||||||||||||||||
[1] | The information has been retroactively adjusted to account for the LCA business which is classified as held for sale as of December 31, 2014, as a discontinued operations. |
Discontinued_Operations_Detail
Discontinued Operations (Details) (USD $) | 12 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 02, 2015 | Jan. 31, 2015 | |
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |||||
Estimated loss on sale from discontinued operations | ($44,598,000) | $0 | $0 | ||
Loss from discontinued operations | -15,155,000 | 0 | 0 | ||
Disposal Group, Including Discontinued Operation, Assets [Abstract] | |||||
Cash and cash equivalents | 4,514,000 | ||||
Accounts receivable | 2,759,000 | ||||
Inventories | 119,000 | ||||
Deferred tax assets | 1,930,000 | ||||
Other current assets | 2,492,000 | ||||
Property & Equipment, net | 14,519,000 | ||||
Goodwill, net | 6,491,000 | ||||
Other intangible assets, net | 38,331,000 | ||||
Other assets | 1,207,000 | ||||
Assets held for sale | 72,362,000 | ||||
Less: Impairment | -1,507,000 | ||||
Assets held for sale, net | 70,855,000 | ||||
Disposal Group, Including Discontinued Operation, Liabilities [Abstract] | |||||
Accounts payable | 5,518,000 | ||||
Other accrued liabilities | 5,933,000 | ||||
Deferred revenues | 97,000 | ||||
Long term debt | 1,080,000 | ||||
Other liabilities | 6,870,000 | ||||
Deferred tax liability | 14,999,000 | ||||
Liabilities held for sale | 34,497,000 | ||||
Total net assets of discontinued operations | 36,358,000 | ||||
LCA-Vision Inc [Member] | |||||
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |||||
Net proceeds, loss on the sale of discontinued operations. | 36,500,000 | ||||
Estimated loss on sale from discontinued operations | 44,598,000 | ||||
Decrease in the implied fair value of goodwill | 43,091,000 | ||||
Revenues at discontinued operations | 47,198,000 | ||||
Loss from discontinued operations | 15,155,000 | ||||
Interest amount of credit facility | 2,065,000 | ||||
Tax expense for discontinued operations | 5,496,000 | ||||
LCA-Vision Inc [Member] | Subsequent Event [Member] | |||||
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |||||
Percentage of shares acquired by wholly-owned subsidiary (in hundredths) | 100.00% | ||||
Amount received after sale of business | 40,000,000 | 40,000,000 | |||
Net proceeds, loss on the sale of discontinued operations. | $36,500,000 |
Acquisition_Details
Acquisition (Details) (USD $) | 12 Months Ended | 0 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | 12-May-14 | Dec. 31, 2013 | |
Business Acquisition [Line Items] | ||||
Effective date of merger | 13-Dec-11 | |||
Common stock, outstanding (in shares) | 20,376,245 | 21,043,947 | ||
Goodwill | $24,048 | $24,930 | ||
LCA-Vision Inc [Member] | ||||
Business Acquisition [Line Items] | ||||
Effective date of merger | 12-May-14 | |||
Percentage of shares acquired by wholly-owned subsidiary (in hundredths) | 100.00% | |||
Fair value LCA-Vision stock | 103,896 | [1] | ||
Fair value of LCA-Vision restricted stock units, including payroll taxes | 2,656 | [2] | ||
Total purchase price | 106,552 | |||
Common stock, outstanding (in shares) | 19,347,554 | |||
Restricted stock, outstanding or deemed to be outstanding (in shares) | 476,436 | |||
Goodwill | 49,582 | |||
Fair value of the assets acquired and liabilities assumed [Abstract] | ||||
Cash and cash equivalents | 29,042 | |||
Current assets, excluding cash and cash equivalents | 6,114 | |||
Deferred tax asset, current | 1,124 | |||
Property, plant and equipment | 17,269 | |||
Identifiable intangible assets | 39,050 | |||
Other assets | 1,518 | |||
Total assets acquired at fair value | 94,117 | |||
Current liabilities | -19,009 | |||
Long-term debt | -1,603 | |||
Deferred tax liability, long-term | -9,138 | |||
Other long-term liabilities | -7,397 | |||
Total liabilities assumed | -37,147 | |||
Net assets acquired | $56,970 | |||
[1] | Based on 19,347,554 outstanding shares of LCA-Vision common stock at May 12, 2014. | |||
[2] | Based on 476,436 outstanding or deemed to be outstanding restricted stock units of LCA-Vision common stock at May 12, 2014. |
Inventories_Details
Inventories (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Schedule of inventories [Abstract] | ||
Raw materials and work-in-process | $7,483 | $12,631 |
Finished goods | 11,897 | 14,916 |
Total inventories | $19,380 | $27,547 |
Property_and_Equipment_Details
Property and Equipment (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule property and equipment [Abstract] | |||
Property and equipment, gross | $25,092 | $18,568 | |
Accumulated depreciation and amortization | -11,290 | -8,079 | |
Total property and equipment, net | 13,802 | 10,489 | |
Depreciation and related amortization expense | 3,657 | 2,875 | 2,367 |
Lasers-in-service [Member] | |||
Schedule property and equipment [Abstract] | |||
Property and equipment, gross | 18,974 | 12,599 | |
Equipment, Computer Hardware and Software [Member] | |||
Schedule property and equipment [Abstract] | |||
Property and equipment, gross | 4,870 | 4,730 | |
Furniture and Fixtures [Member] | |||
Schedule property and equipment [Abstract] | |||
Property and equipment, gross | 767 | 705 | |
Leasehold Improvements [Member] | |||
Schedule property and equipment [Abstract] | |||
Property and equipment, gross | $481 | $534 |
Patents_and_Licensed_Technolog2
Patents and Licensed Technologies, net (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Patents and Licensed Technologies [Abstract] | |||
Net Book Value | $8,811 | $10,832 | |
Amortization expense | 2,055 | 2,043 | 2,049 |
Estimated amortization expense for amortizable patents and licensed technologies assets [Abstract] | |||
Net Book Value | 8,811 | 10,832 | |
Patents [Member] | |||
Patents and Licensed Technologies [Abstract] | |||
Product and core technologies under purchase price allocation | 13,500 | ||
Patents and Licensed Technologies [Member] | |||
Patents and Licensed Technologies [Abstract] | |||
Gross Amount beginning of period | 15,648 | 15,411 | |
Additions | 168 | 171 | |
Translation differences | -190 | 66 | |
Gross Amount end of period | 15,626 | 15,648 | |
Accumulated amortization | -6,815 | -4,816 | |
Net Book Value | 8,811 | 10,832 | |
Estimated amortization expense for amortizable patents and licensed technologies assets [Abstract] | |||
2015 | 2,056 | ||
2016 | 2,019 | ||
2017 | 903 | ||
2018 | 906 | ||
2019 | 892 | ||
Thereafter | 2,035 | ||
Net Book Value | $8,811 | $10,832 |
Goodwill_and_Other_Intangible_2
Goodwill and Other Intangible Assets (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | $24,930 | ||
Additions to goodwill | 0 | ||
Translation differences | -882 | ||
Goodwill, ending balance | 24,048 | 24,930 | |
Accumulated impairment loss | 0 | ||
Schedule of definite-lived intangible assets [Abstract] | |||
Gross Amount beginning of period | 12,189 | 12,116 | |
Translation differences | -208 | 73 | |
Gross Amount end of period | 11,981 | 12,189 | 12,116 |
Accumulated Amortization | -3,644 | -2,488 | |
Net Book Value | 8,337 | 9,701 | |
Amortization expense | 1,200 | 1,200 | 1,212 |
Estimated amortization expense for amortizable intangible assets [Abstract] | |||
2015 | 1,200 | ||
2016 | 1,200 | ||
2017 | 1,200 | ||
2018 | 1,200 | ||
2019 | 1,200 | ||
Thereafter | 2,337 | ||
Net Book Value | 8,337 | 9,701 | |
Trademarks [Member] | |||
Schedule of definite-lived intangible assets [Abstract] | |||
Gross Amount beginning of period | 5,772 | 5,744 | |
Translation differences | -80 | 28 | |
Gross Amount end of period | 5,692 | 5,772 | |
Accumulated Amortization | -1,731 | -1,178 | |
Net Book Value | 3,961 | 4,594 | |
Estimated amortization expense for amortizable intangible assets [Abstract] | |||
Net Book Value | 3,961 | 4,594 | |
Customer Relationships [Member] | |||
Schedule of definite-lived intangible assets [Abstract] | |||
Gross Amount beginning of period | 6,417 | 6,372 | |
Translation differences | -128 | 45 | |
Gross Amount end of period | 6,289 | 6,417 | |
Accumulated Amortization | -1,913 | -1,310 | |
Net Book Value | 4,376 | 5,107 | |
Estimated amortization expense for amortizable intangible assets [Abstract] | |||
Net Book Value | 4,376 | 5,107 | |
Radiancy, Inc. [Member] | |||
Goodwill [Line Items] | |||
Definite-lived intangible assets recorded as a part of purchase price allocation | 12,000 | ||
Goodwill [Roll Forward] | |||
Goodwill, ending balance | 24,005 | ||
Consumer Segment [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill, ending balance | 19,968 | ||
Physician Recurring Segment [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill, ending balance | $4,080 |
Accrued_Compensation_and_relat2
Accrued Compensation and related expenses (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Accrued Compensation and related expenses [Abstract] | ||
Accrued payroll and related taxes | $513 | $707 |
Accrued vacation | 211 | 290 |
Accrued commissions and bonuses | 1,898 | 2,233 |
Total accrued compensation and related expense | $2,622 | $3,230 |
Other_Accrued_Liabilities_Deta
Other Accrued Liabilities (Details) (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | ||
Other Accrued Liabilities [Abstract] | ||||
Accrued warranty, current, see Note 1 | $665 | $1,094 | ||
Accrued taxes, including liability for unrecognized tax benefit, see Note 13 | 1,362 | 1,023 | ||
Accrued sales return | 7,651 | [1] | 16,046 | [1] |
Other accrued liabilities | 3,344 | 3,869 | ||
Total other accrued liabilities | 13,022 | 22,032 | ||
Sales returns liability roll forward [Abstract] | ||||
Balance at beginning of year | 16,046 | [1] | 11,901 | |
Additions that reduce net sales | 35,771 | 47,916 | ||
Actual returns | -44,166 | -43,771 | ||
Balance at end of year | $7,651 | [1] | $16,046 | [1] |
[1] | The activity in the sales returns liability account was as follows: December 31, 2014 2013 Balance at beginning of year $ 16,046 $ 11,901 Additions that reduce net sales 35,771 47,916 Actual returns (44,166) (43,771) Balance at end of year $ 7,651 $ 16,046 |
Longterm_Debt_Details
Long-term Debt (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Debt Instrument [Line Items] | ||
Sub-Total | $76,500,000 | $10,000,000 |
Less: current portion | 38,732,000 | 10,000,000 |
Long-term Debt | 37,768,000 | 0 |
Unamortized related debt issue costs and debt discount | 2,358,000 | |
Description of variable rate basis | LIBOR plus 2.5% | |
Future minimum payment for long-term debt [Abstract] | ||
2015 | 38,732,000 | |
2016 | 37,768,000 | |
Sub-Total | 76,500,000 | 10,000,000 |
Forbearance Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Prepayments on term loan | 250,000 | |
Percentage of exceeded cash on hand to be paid against revolving loans (in hundredths) | 100.00% | |
Minimum amount of cash specified against payment of revolving loans | 7,000,000 | |
Possible increase in interest (in hundredths) | 2.00% | |
Maximum capital expenditures on medical devices | 100,000 | |
Lenders fee | 500,000 | |
Percentage of accrued and earned lender's fee for remaining period (in hundredths) | 50.00% | |
Forbearance Agreement [Member] | Fee Payment Each Month For May and June 2015 [Member] | ||
Debt Instrument [Line Items] | ||
Lenders fee | 750,000 | |
Forbearance Agreement [Member] | Fee Payment Each Month For July Through September 2015 [Member] | ||
Debt Instrument [Line Items] | ||
Lenders fee | 1,000,000 | |
Forbearance Agreement [Member] | Fee Payment Each Month For October Through December 2015 [Member] | ||
Debt Instrument [Line Items] | ||
Lenders fee | 1,250,000 | |
Forbearance Agreement [Member] | Fee Payment Each Month For January Through March 2016 [Member] | ||
Debt Instrument [Line Items] | ||
Lenders fee | 1,500,000 | |
CB Floating Rate [Member] | Forbearance Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate (in hundredths) | 4.00% | |
Senior-Secured Credit Facilities [Member] | ||
Debt Instrument [Line Items] | ||
Sub-Total | 76,500,000 | 0 |
Maximum borrowing capacity | 75,000,000 | |
Minimum amount of cash specified against payment of revolving loans | 5,000,000 | |
Description of variable rate basis | Eurodollar | |
Future minimum payment for long-term debt [Abstract] | ||
Sub-Total | 76,500,000 | 0 |
Senior-Secured Credit Facilities [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Outstanding principal amount | 10,000,000 | |
Senior-Secured Credit Facilities [Member] | Eurodollar [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate (in hundredths) | 3.25% | |
Senior-Secured Credit Facilities [Member] | Eurodollar [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate (in hundredths) | 4.50% | |
Term Note [Member] | ||
Debt Instrument [Line Items] | ||
Sub-Total | 0 | 10,000,000 |
Maximum borrowing capacity | 15,000,000 | |
Repayment period | 1 year | |
Total borrowings | 10,000,000 | |
Future minimum payment for long-term debt [Abstract] | ||
Sub-Total | 0 | 10,000,000 |
Term Note [Member] | LIBOR [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate (in hundredths) | 2.50% | |
Term Note [Member] | Federal [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate (in hundredths) | 0.50% | |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | 10,000,000 | |
Term Loan [Member] | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | 75,000,000 | |
Repayment period | 4 years | |
Prepayments on term loan | 125,000 | |
Minimum amount of cash specified against payment of revolving loans | 5,000,000 | |
Term Loan [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Outstanding principal amount | $10,000,000 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Customer | |||
State | |||
Executive | |||
Lease | |||
Commitments and Contingencies [Abstract] | |||
Number of minority operating lease | 1 | ||
Loss Contingencies [Line Items] | |||
Rent expense | $4,708,000 | $1,002,000 | $908,000 |
Number of executives | 2 | ||
Maximum settlement amount | 100,000 | ||
Number of customers | 12 | ||
Number of states | 10 | ||
Annual minimum payments under operating lease [Abstract] | |||
2015 | 814,000 | ||
2016 | 472,000 | ||
2017 | 176,000 | ||
Thereafter | 366,000 | ||
Total | 1,828,000 | ||
Amount of aggregate commitment under the executive severance agreements should all covered executives and employees be terminated other than for cause | 10,073,000 | ||
Amount of commitment should all covered executives and certain key employees be terminated following a change in control of the Company | 9,820,000 | ||
LCA-Vision [Member] | |||
Loss Contingencies [Line Items] | |||
Rent expense | 3,690,000 | ||
Annual minimum payments under operating lease [Abstract] | |||
Total | $17,916,000 |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | ||||||||||||
Dec. 12, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 28, 2013 | Mar. 18, 2012 | Apr. 17, 2014 | Jan. 26, 2012 | Feb. 27, 2014 | 12-May-14 | Nov. 07, 2014 | Dec. 10, 2014 | Aug. 31, 2013 | Aug. 18, 2012 | Dec. 13, 2011 | |
Employee | |||||||||||||||
Preferred Stock [Abstract] | |||||||||||||||
Preferred Stock, par value (in dollars per share) | $0.01 | $0.01 | |||||||||||||
Preferred Stock, authorized (in shares) | 5,000,000 | 5,000,000 | |||||||||||||
Preferred Stock, outstanding (in shares) | 0 | 0 | |||||||||||||
Preferred Stock, issued (in shares) | 0 | 0 | |||||||||||||
Common Stock [Abstract] | |||||||||||||||
Common stock shares sold (in shares) | 645,000 | 3,023,432 | |||||||||||||
Common stock offering price (in dollars per share) | $2.19 | $13.23 | |||||||||||||
Proceeds from issuance of common stock, net | $1,413,000 | $0 | $37,514,000 | ||||||||||||
Stock repurchased during period (in shares) | 16,056 | ||||||||||||||
Stock repurchased average price (in dollars per share) | $13.98 | ||||||||||||||
Stock repurchased during period | 41,757,000 | ||||||||||||||
Common Stock, issued (in shares) | 20,376,245 | 18,903,245 | |||||||||||||
Black-Scholes option-pricing model to estimate fair value of grants of stock options [Abstract] | |||||||||||||||
Share price (in dollars per share) | $1.37 | ||||||||||||||
Total stock-based compensation expense | 4,936,000 | 4,985,000 | 6,197,000 | ||||||||||||
Unrecognized compensation cost related to non-vested stock awards | 7,644,000 | ||||||||||||||
Unrecognized compensation cost expected to recognized | 3 years 1 month 20 days | ||||||||||||||
Common Stock Warrants [Abstract] | |||||||||||||||
Warrants issued (in shares) | 0.305836 | ||||||||||||||
Warrants (in shares) | 1,026,435 | ||||||||||||||
Increase in Warrants Price (in dollars per share) | $0.50 | ||||||||||||||
Warrant exercise price (in dollars per share) | $2.25 | $20 | |||||||||||||
Warrants expiration date, start date | 12-Dec-15 | ||||||||||||||
Warrants expiration date, end date | 12-Dec-17 | ||||||||||||||
Warrant exercise period | 5 years | ||||||||||||||
Minimum closing trading price (in dollars per share) | $30 | ||||||||||||||
Consecutive trading days | 20 days | ||||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||||
Outstanding Number of Shares (in shares) | 1,159,554 | ||||||||||||||
Weighted Average Remaining Contractual Life (years) | 7 years 6 months 14 days | ||||||||||||||
Weighted Average Exercise Price (in dollars per share) | $16.23 | ||||||||||||||
Exercisable Number of Shares (in shares) | 510,954 | ||||||||||||||
Exercisable Weighted Avg. Exercise Price (in dollars per share) | $16.47 | ||||||||||||||
$0 - $7.50 [Member] | |||||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||||
Options Range of Exercise Prices, lower limit (in dollars per share) | $0 | ||||||||||||||
Options Range of Exercise Prices, upper limit (in dollars per share) | $7.50 | ||||||||||||||
Outstanding Number of Shares (in shares) | 21,584 | ||||||||||||||
Weighted Average Remaining Contractual Life (years) | 4 years 6 months 29 days | ||||||||||||||
Weighted Average Exercise Price (in dollars per share) | $6.12 | ||||||||||||||
Exercisable Number of Shares (in shares) | 21,584 | ||||||||||||||
Exercisable Weighted Avg. Exercise Price (in dollars per share) | $6.11 | ||||||||||||||
$7.51 - $15.00 [Member] | |||||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||||
Options Range of Exercise Prices, lower limit (in dollars per share) | $7.51 | ||||||||||||||
Options Range of Exercise Prices, upper limit (in dollars per share) | $15 | ||||||||||||||
Outstanding Number of Shares (in shares) | 699,622 | ||||||||||||||
Weighted Average Remaining Contractual Life (years) | 7 years 10 months 6 days | ||||||||||||||
Weighted Average Exercise Price (in dollars per share) | $14.11 | ||||||||||||||
Exercisable Number of Shares (in shares) | 255,022 | ||||||||||||||
Exercisable Weighted Avg. Exercise Price (in dollars per share) | $13.93 | ||||||||||||||
$15.01 - $22.50 [Member] | |||||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||||
Options Range of Exercise Prices, lower limit (in dollars per share) | $15.01 | ||||||||||||||
Options Range of Exercise Prices, upper limit (in dollars per share) | $22.50 | ||||||||||||||
Outstanding Number of Shares (in shares) | 427,900 | ||||||||||||||
Weighted Average Remaining Contractual Life (years) | 7 years 3 months 25 days | ||||||||||||||
Weighted Average Exercise Price (in dollars per share) | $19.02 | ||||||||||||||
Exercisable Number of Shares (in shares) | 223,900 | ||||||||||||||
Exercisable Weighted Avg. Exercise Price (in dollars per share) | $18.13 | ||||||||||||||
$22.51 [Member] | |||||||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||||||||||||||
Options Range of Exercise Prices, lower limit (in dollars per share) | $22.51 | ||||||||||||||
Outstanding Number of Shares (in shares) | 10,448 | ||||||||||||||
Weighted Average Remaining Contractual Life (years) | 1 year 6 months 22 days | ||||||||||||||
Weighted Average Exercise Price (in dollars per share) | $64.42 | ||||||||||||||
Exercisable Number of Shares (in shares) | 10,448 | ||||||||||||||
Exercisable Weighted Avg. Exercise Price (in dollars per share) | $64.42 | ||||||||||||||
Board of Directors [Member] | |||||||||||||||
Common Stock [Abstract] | |||||||||||||||
Stock repurchase program, authorized amount | 30,000,000 | 25,000,000 | |||||||||||||
Stock repurchased during period (in shares) | 2,987,413 | ||||||||||||||
Employees and Consultants [Member] | |||||||||||||||
Common Stock Options [Abstract] | |||||||||||||||
Award vesting period | 5 years | 5 years | |||||||||||||
Stock options expiration period | 10 years | 10 years | |||||||||||||
Number of Stock Options [Roll Forward] | |||||||||||||||
Granted (in shares) | 177,125 | 509,000 | |||||||||||||
Black-Scholes option-pricing model to estimate fair value of grants of stock options [Abstract] | |||||||||||||||
Strike price options | $15 | $14 | |||||||||||||
Non-employee Director Stock Option Plan [Member] | |||||||||||||||
Common Stock [Abstract] | |||||||||||||||
Common Stock, issued (in shares) | 5,000 | 30,000 | |||||||||||||
Number of executive employees | 6 | ||||||||||||||
Common Stock Options [Abstract] | |||||||||||||||
Authorized shares (in shares) | 370,000 | ||||||||||||||
Stock reserved for issuance to eligible employees (in shares) | 7,000 | ||||||||||||||
Shares reserved for future issuance under stock option (in shares) | 14,578 | ||||||||||||||
One time stock issuance after reverse merger (in shares) | 5,000 | ||||||||||||||
Black-Scholes option-pricing model to estimate fair value of grants of stock options [Abstract] | |||||||||||||||
Aggregate fair value | 75,000 | 405,000 | |||||||||||||
2005 Equity Plan [Member] | |||||||||||||||
Common Stock Options [Abstract] | |||||||||||||||
Authorized shares (in shares) | 6,000,000 | ||||||||||||||
Shares reserved for future issuance under stock option (in shares) | 1,144,976 | ||||||||||||||
Shares reserved for future issuance under common stock (in shares) | 1,576,095 | ||||||||||||||
Non-qualified [Member] | Executives Employees [Member] | |||||||||||||||
Common Stock [Abstract] | |||||||||||||||
Number of executive employees | 2 | 2 | |||||||||||||
Common Stock Options [Abstract] | |||||||||||||||
Award vesting period | 5 years | 5 years | |||||||||||||
Stock options expiration period | 10 years | 10 years | |||||||||||||
Number of Stock Options [Roll Forward] | |||||||||||||||
Granted (in shares) | 82,500 | 230,000 | |||||||||||||
Black-Scholes option-pricing model to estimate fair value of grants of stock options [Abstract] | |||||||||||||||
Aggregate fair value | 2,590,000 | 6,652,000 | |||||||||||||
Strike price options | $20 | $20 | |||||||||||||
Stock Options [Member] | |||||||||||||||
Number of Stock Options [Roll Forward] | |||||||||||||||
Outstanding, beginning of the period (in shares) | 1,132,678 | 898,541 | 180,718 | ||||||||||||
Granted (in shares) | 181,500 | 259,625 | 739,000 | ||||||||||||
Exercised (in shares) | 0 | -3,750 | -10,048 | ||||||||||||
Expired/cancelled (in shares) | -154,624 | -21,738 | -11,129 | ||||||||||||
Outstanding, ending of the period (in shares) | 1,159,554 | 1,132,678 | 898,541 | ||||||||||||
Outstanding and Exercisable, at ending period (in shares) | 510,954 | ||||||||||||||
Weighted Average Exercise Price [Roll Forward] | |||||||||||||||
Outstanding, beginning period (in dollars per share) | $16.51 | $16.65 | $19.54 | ||||||||||||
Granted (in dollars per share) | $14.10 | $16.59 | $15.87 | ||||||||||||
Exercised (in dollars per share) | $0 | $6.24 | $6.67 | ||||||||||||
Expired/cancelled (in dollars per share) | $15.73 | $31.36 | $20.25 | ||||||||||||
Outstanding, ending period (in dollars per share) | $16.23 | $16.51 | $16.65 | ||||||||||||
Outstanding and Exercisable, ending period (in dollars per share) | $16.47 | ||||||||||||||
Number of Shares [Abstract] | |||||||||||||||
2015 (in shares) | 2,499 | ||||||||||||||
2016 (in shares) | 2,634 | ||||||||||||||
2017 (in shares) | 3,146 | ||||||||||||||
2018 (in shares) | 2,169 | ||||||||||||||
2019 and later (in shares) | 1,149,106 | ||||||||||||||
Number of Shares (in shares) | 1,159,554 | ||||||||||||||
Weighted Average Exercise Price [Abstract] | |||||||||||||||
2015 (in dollars per share) | $102.90 | ||||||||||||||
2016 (in dollars per share) | $69.48 | ||||||||||||||
2017 (in dollars per share) | $46.85 | ||||||||||||||
2018 (in dollars per share) | $39.41 | ||||||||||||||
2019 and later (in dollars per share) | $15.79 | ||||||||||||||
Weighted Average Exercise Price (in dollars per share) | $16.23 | ||||||||||||||
Exercise Price [Abstract] | |||||||||||||||
2015 (in dollars per share) | $102.90 | ||||||||||||||
Black-Scholes option-pricing model to estimate fair value of grants of stock options [Abstract] | |||||||||||||||
Risk-free interest rate (in hundredths) | 2.17% | 1.30% | |||||||||||||
Volatility (in hundredths) | 78.41% | 85.25% | |||||||||||||
Expected dividend yield (in hundredths) | 0.00% | 0.00% | |||||||||||||
Expected life (in years) | 5 years 6 months | 5 years 6 months | |||||||||||||
Estimated forfeiture rate (in hundredths) | 0.00% | 0.00% | |||||||||||||
Share price (in dollars per share) | $1.53 | ||||||||||||||
Stock Options [Member] | Employees and Consultants [Member] | |||||||||||||||
Common Stock Options [Abstract] | |||||||||||||||
Award vesting period | 5 years | ||||||||||||||
Stock options expiration period | 10 years | ||||||||||||||
Number of Stock Options [Roll Forward] | |||||||||||||||
Granted (in shares) | 71,500 | ||||||||||||||
Black-Scholes option-pricing model to estimate fair value of grants of stock options [Abstract] | |||||||||||||||
Aggregate fair value | 718,000 | ||||||||||||||
Strike price options | $14.80 | ||||||||||||||
Stock Options [Member] | Employees [Member] | |||||||||||||||
Common Stock Options [Abstract] | |||||||||||||||
Award vesting period | 4 years | ||||||||||||||
Stock options expiration period | 10 years | ||||||||||||||
Number of Stock Options [Roll Forward] | |||||||||||||||
Granted (in shares) | 109,000 | ||||||||||||||
Black-Scholes option-pricing model to estimate fair value of grants of stock options [Abstract] | |||||||||||||||
Aggregate fair value | 975,000 | ||||||||||||||
Strike price options | $13.70 | ||||||||||||||
Restricted Stock [Member] | Executives Employees [Member] | |||||||||||||||
Common Stock [Abstract] | |||||||||||||||
Number of executive employees | 2 | ||||||||||||||
Common Stock Options [Abstract] | |||||||||||||||
Stock options expiration period | 4 years | ||||||||||||||
Black-Scholes option-pricing model to estimate fair value of grants of stock options [Abstract] | |||||||||||||||
Aggregate fair value | 1,217,000 | ||||||||||||||
Restricted stock units granted (in shares) | 390,000 | ||||||||||||||
Price of restricted stock (in dollars per share) | $0.01 | ||||||||||||||
Number of Warrants [Abstract] | |||||||||||||||
Issued (in shares) | 390,000 | ||||||||||||||
Restricted Stock [Member] | Employees and Consultants [Member] | LCA-Vision Inc [Member] | |||||||||||||||
Common Stock [Abstract] | |||||||||||||||
Number of executive employees | 3 | ||||||||||||||
Common Stock Options [Abstract] | |||||||||||||||
Stock options expiration period | 3 years | ||||||||||||||
Black-Scholes option-pricing model to estimate fair value of grants of stock options [Abstract] | |||||||||||||||
Aggregate fair value | 1,936,000 | ||||||||||||||
Restricted stock units granted (in shares) | 141,337 | ||||||||||||||
Price of restricted stock (in dollars per share) | $0.01 | ||||||||||||||
Number of Warrants [Abstract] | |||||||||||||||
Issued (in shares) | 141,337 | ||||||||||||||
Restricted Stock [Member] | Employees [Member] | |||||||||||||||
Common Stock Options [Abstract] | |||||||||||||||
Stock options expiration period | 4 years | ||||||||||||||
Black-Scholes option-pricing model to estimate fair value of grants of stock options [Abstract] | |||||||||||||||
Aggregate fair value | $435,000 | ||||||||||||||
Restricted stock units granted (in shares) | 290,000 | ||||||||||||||
Price of restricted stock (in dollars per share) | $0.01 | ||||||||||||||
Number of Warrants [Abstract] | |||||||||||||||
Issued (in shares) | 290,000 | ||||||||||||||
Warrant [Member] | |||||||||||||||
Black-Scholes option-pricing model to estimate fair value of grants of stock options [Abstract] | |||||||||||||||
Share price (in dollars per share) | $1.53 | ||||||||||||||
Restricted stock units granted (in shares) | 322,500 | 0 | 25,000 | ||||||||||||
Number of Warrants [Abstract] | |||||||||||||||
Outstanding, Beginning Balance (in shares) | 1,058,679 | 1,063,268 | 1,067,240 | ||||||||||||
Issued (in shares) | 322,500 | 0 | 25,000 | ||||||||||||
Exercised (in shares) | 0 | 0 | -17,756 | ||||||||||||
Expired/cancelled (in shares) | 0 | -4,589 | -11,216 | ||||||||||||
Outstanding, Ending Balance (in shares) | 1,381,179 | 1,058,679 | 1,063,268 | ||||||||||||
Weighted Average Exercise Price [Abstract] | |||||||||||||||
Outstanding, Beginning Balance (in dollars per share) | $19.91 | $19.91 | $19.98 | ||||||||||||
Issued (in dollars per share) | $2.25 | $0 | $20 | ||||||||||||
Exercised (in dollars per share) | $0 | $0 | $7.50 | ||||||||||||
Expired/cancelled | $0 | $18.48 | $47.04 | ||||||||||||
Outstanding, Ending Balance (in dollars per share) | $15.79 | $19.91 | $19.91 | ||||||||||||
Number of Warrants [Abstract] | |||||||||||||||
2015 (in shares) | 32,250 | ||||||||||||||
2016 (in shares) | 1,026,429 | ||||||||||||||
2017 (in shares) | 322,500 | ||||||||||||||
Number of Warrants (in shares) | 1,381,179 | 1,058,679 | 1,063,268 | ||||||||||||
Weighted Average Exercise Price [Abstract] | |||||||||||||||
2015 (in dollars per share) | $17.19 | ||||||||||||||
2016 (in dollars per share) | $20 | ||||||||||||||
2017 (in dollars per share) | $2.25 | ||||||||||||||
Weighted Average Exercise Price (in dollars per share) | $15.79 | $19.91 | $19.91 | ||||||||||||
Minimum [Member] | Stock Options [Member] | |||||||||||||||
Exercise Price [Abstract] | |||||||||||||||
2016 (in dollars per share) | $48.72 | ||||||||||||||
2017 (in dollars per share) | $46.62 | ||||||||||||||
2018 (in dollars per share) | $37.80 | ||||||||||||||
2019 and later (in dollars per share) | $5.70 | ||||||||||||||
Exercise Price (in dollars per share) | $5.70 | ||||||||||||||
Maximum [Member] | Stock Options [Member] | |||||||||||||||
Exercise Price [Abstract] | |||||||||||||||
2016 (in dollars per share) | $93.66 | ||||||||||||||
2017 (in dollars per share) | $47.88 | ||||||||||||||
2018 (in dollars per share) | $39.90 | ||||||||||||||
2019 and later (in dollars per share) | $20 | ||||||||||||||
Exercise Price (in dollars per share) | $102.90 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Income (loss) before income tax [Abstract] | |||
U.S. | ($25,398,000) | $7,700,000 | $3,152,000 |
Israel | 1,780,000 | 14,279,000 | 20,410,000 |
Other Foreign | -1,813,000 | 768,000 | 3,365,000 |
Income (loss) before income taxes | -25,431,000 | 22,747,000 | 26,927,000 |
United States - Federal tax [Abstract] | |||
Current | -1,030,000 | -1,253,000 | 2,752,000 |
Deferred | 34,117,000 | 1,795,000 | -1,572,000 |
United States - State tax [Abstract] | |||
Current | 195,000 | 180,000 | 315,000 |
Deferred | 245,000 | 850,000 | -2,074,000 |
Israel [Abstract] | |||
Current | 1,431,000 | 2,781,000 | 4,034,000 |
Deferred | -190,000 | -237,000 | -50,000 |
Other Foreign [Abstract] | |||
Current | 81,000 | 54,000 | 1,371,000 |
Deferred | 1,463,000 | 200,000 | -338,000 |
Income tax expense | 36,312,000 | 4,370,000 | 4,438,000 |
Reconciliation of the federal statutory income tax rate to the effective income tax rate [Abstract] | |||
Federal Tax rate (in hundredths) | 34.00% | 34.00% | 34.00% |
Federal tax expense (benefit) at 34% | -9,349,000 | 7,733,000 | 9,157,000 |
State and local income tax, net of Federal benefit | 373,000 | 958,000 | 286,000 |
Foreign rate differential | -483,000 | -2,404,000 | -3,962,000 |
Increase in taxes from permanent differences in stock-based compensation | 330,000 | 420,000 | 618,000 |
US taxation of foreign earnings - Subpart F | 11,571,000 | 357,000 | 403,000 |
Increase (decrease) in uncertain tax positions | 0 | 269,000 | -2,325,000 |
Return to provision and other adjustments | 301,000 | -1,963,000 | 0 |
Impact of tax rate change on deferred taxes | 724,000 | -942,000 | 0 |
Foreign tax credits | -7,041,000 | -341,000 | 0 |
Tax on foreign exchange | 1,578,000 | 0 | 0 |
Tax on undistributed earnings | 3,333,000 | 0 | 0 |
Change in valuation allowance | 34,695,000 | 116,000 | 0 |
Other, net | 280,000 | 167,000 | 261,000 |
Income tax expense | 36,312,000 | 4,370,000 | 4,438,000 |
Photo Therapeutics Ltd [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 11,000,000 | ||
Operating loss carryforwards, valuation allowance | 7,000,000 | ||
U.S. Companies [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Percentage of valuation allowance (in hundredths) | 100.00% | ||
Deferred tax assets liabilities net | 0 | ||
Brazilian Subsidiary [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 1,700,000 | ||
Israeli Subsidiary [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Income tax examination | 2011 through 2013 | ||
Other Subsidiaries [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Percentage of valuation allowance (in hundredths) | 100.00% | ||
Other Subsidiaries [Member] | Maximum [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 100,000 | ||
Federal [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 48,000,000 | ||
Income tax examination | 2011 through 2013 | ||
State and Local Jurisdiction [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Other tax attributes | $3,200,000 | ||
Operating loss carryforwards expiration | 2017 to 2034 | ||
Income tax examination | 2006 through 2013 |
Income_Taxes_Tax_Carryforward_
Income Taxes, Tax Carryforward and Other (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Components of deferred income tax assets and liabilities [Abstract] | ||
Loss carryforwards | $39,217 | $21,092 |
AMT credits | 112 | 112 |
Foreign tax credits | 7,066 | 0 |
Accrued employment expenses | 1,785 | 1,256 |
Amortization and write-offs | 9,480 | 8,883 |
Capitalized R&D costs | 2,663 | 2,933 |
Deferred revenues | 0 | 84 |
Depreciation | 2,022 | 4,360 |
Doubtful accounts | 4,177 | 3,499 |
Inventory reserves | 1,030 | 822 |
Tax on undistributed earnings | -3,333 | 0 |
Other accruals and reserves | 324 | 228 |
Return allowances | 2,787 | 5,660 |
Translation adjustments | -44 | 61 |
Gross deferred tax asset | 67,286 | 48,990 |
Less: valuation allowance | -65,957 | -11,910 |
Net deferred tax asset | 1,329 | 37,080 |
Among current assets | 762 | 13,041 |
Among other non-current assets | $567 | $24,039 |
Income_Taxes_Income_Taxes_cont
Income Taxes, Income Taxes continued (Details) (USD $) | 12 Months Ended | 0 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Apr. 01, 2015 |
Tax Benefits Under Law of Encouragements [Abstract] | ||||
Tax exempt period | 2 years | |||
Rate at which subsidiary earnings are taxed (in hundredths) | 34.00% | 34.00% | 34.00% | |
Reconciliation of the beginning and ending amount of unrecognized tax benefits [Roll Forward] | ||||
Beginning balance | $644 | $375 | $2,700 | |
Additions / Settlements | 0 | 269 | -2,325 | |
Ending balance | $644 | $644 | $375 | |
Minimum [Member] | ||||
Tax Benefits Under Law of Encouragements [Abstract] | ||||
Succeeding tax exempt period | 5 years | |||
Maximum [Member] | ||||
Tax Benefits Under Law of Encouragements [Abstract] | ||||
Succeeding tax exempt period | 8 years | |||
Israeli subsidiary [Member] | ||||
Tax Benefits Under Law of Encouragements [Abstract] | ||||
Tax exempt rate (in hundredths) | 15.00% | |||
Israeli subsidiary [Member] | Current Period [Member] | ||||
Tax Benefits Under Law of Encouragements [Abstract] | ||||
Standard corporate income tax rate (in hundredths) | 25.00% | |||
Israeli subsidiary [Member] | Prospective [Member] | ||||
Tax Benefits Under Law of Encouragements [Abstract] | ||||
Standard corporate income tax rate (in hundredths) | 26.50% | |||
Preferred income tax rate (in hundredths) | 16.00% | |||
United Kingdom Tax Authority [Member] | ||||
Tax Benefits Under Law of Encouragements [Abstract] | ||||
Rate at which subsidiary earnings are taxed (in hundredths) | 21.00% | 23.00% | 24.00% | |
United Kingdom Tax Authority [Member] | Subsequent Event [Member] | ||||
Tax Benefits Under Law of Encouragements [Abstract] | ||||
Rate at which subsidiary earnings are taxed (in hundredths) | 20.00% |
Business_Segments_and_Geograph
Business Segments and Geographic Data (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||
Segment | |||||||||||||||||
Business Segment and Geographic Data [Abstract] | |||||||||||||||||
Number of operating segments | 3 | ||||||||||||||||
Results of operations from business segments [Abstract] | |||||||||||||||||
Revenues | $38,878 | $35,611 | [1] | $38,977 | [1] | $50,075 | $63,490 | $45,893 | $58,065 | $57,216 | $54,791 | $56,681 | $58,906 | $50,273 | $163,541 | $224,664 | $220,651 |
Cost of revenues | 38,619 | 45,035 | 46,642 | ||||||||||||||
Gross profit | 28,088 | 26,896 | [1] | 30,208 | [1] | 39,730 | 50,777 | 36,827 | 46,675 | 45,350 | 43,019 | 45,400 | 46,551 | 39,039 | 124,922 | 179,629 | 174,009 |
Gross profit % (in hundredths) | 76.40% | 80.00% | 78.90% | ||||||||||||||
Allocated operating expenses [Abstract] | |||||||||||||||||
Engineering and product development | 3,086 | 3,306 | 2,914 | ||||||||||||||
Selling and marketing expenses | 107,169 | 127,528 | 116,487 | ||||||||||||||
Unallocated operating expenses | 35,711 | 26,750 | 27,330 | ||||||||||||||
Total operating expenses | 145,966 | 157,584 | 146,731 | ||||||||||||||
(Loss) income from continuing operations before interest and other financing income (expense), net | -21,044 | 22,045 | 27,278 | ||||||||||||||
Interest and other financing income (expense), net | -4,387 | 702 | -351 | ||||||||||||||
(Loss) income from continuing operations before income taxes | -25,431 | 22,747 | 26,927 | ||||||||||||||
Operating Segments [Member] | CONSUMER [Member] | |||||||||||||||||
Results of operations from business segments [Abstract] | |||||||||||||||||
Revenues | 120,931 | 188,259 | 188,425 | ||||||||||||||
Cost of revenues | 20,307 | 26,794 | 28,965 | ||||||||||||||
Gross profit | 100,624 | 161,465 | 159,460 | ||||||||||||||
Gross profit % (in hundredths) | 83.20% | 85.80% | 84.60% | ||||||||||||||
Allocated operating expenses [Abstract] | |||||||||||||||||
Engineering and product development | 1,105 | 1,100 | 876 | ||||||||||||||
Selling and marketing expenses | 89,637 | 112,898 | 102,736 | ||||||||||||||
Unallocated operating expenses | 0 | 0 | 0 | ||||||||||||||
Total operating expenses | 90,742 | 113,998 | 103,612 | ||||||||||||||
(Loss) income from continuing operations before interest and other financing income (expense), net | 9,882 | 47,467 | 55,848 | ||||||||||||||
Interest and other financing income (expense), net | 0 | 0 | 0 | ||||||||||||||
(Loss) income from continuing operations before income taxes | 9,882 | 47,467 | 55,848 | ||||||||||||||
Operating Segments [Member] | PHYSICIAN RECURRING [Member] | |||||||||||||||||
Results of operations from business segments [Abstract] | |||||||||||||||||
Revenues | 34,240 | 28,548 | 21,284 | ||||||||||||||
Cost of revenues | 12,718 | 13,022 | 11,512 | ||||||||||||||
Gross profit | 21,522 | 15,526 | 9,772 | ||||||||||||||
Gross profit % (in hundredths) | 62.90% | 54.00% | 45.90% | ||||||||||||||
Allocated operating expenses [Abstract] | |||||||||||||||||
Engineering and product development | 1,177 | 1,371 | 1,201 | ||||||||||||||
Selling and marketing expenses | 16,347 | 12,681 | 10,203 | ||||||||||||||
Unallocated operating expenses | 0 | 0 | 0 | ||||||||||||||
Total operating expenses | 17,524 | 14,052 | 11,404 | ||||||||||||||
(Loss) income from continuing operations before interest and other financing income (expense), net | 3,998 | 1,474 | -1,632 | ||||||||||||||
Interest and other financing income (expense), net | 0 | 0 | 0 | ||||||||||||||
(Loss) income from continuing operations before income taxes | 3,998 | 1,474 | -1,632 | ||||||||||||||
Operating Segments [Member] | PROFESSIONAL [Member] | |||||||||||||||||
Results of operations from business segments [Abstract] | |||||||||||||||||
Revenues | 8,370 | 7,857 | 10,942 | ||||||||||||||
Cost of revenues | 5,594 | 5,219 | 6,165 | ||||||||||||||
Gross profit | 2,776 | 2,638 | 4,777 | ||||||||||||||
Gross profit % (in hundredths) | 33.20% | 33.60% | 43.70% | ||||||||||||||
Allocated operating expenses [Abstract] | |||||||||||||||||
Engineering and product development | 804 | 835 | 837 | ||||||||||||||
Selling and marketing expenses | 1,185 | 1,949 | 3,548 | ||||||||||||||
Unallocated operating expenses | 0 | 0 | 0 | ||||||||||||||
Total operating expenses | 1,989 | 2,784 | 4,385 | ||||||||||||||
(Loss) income from continuing operations before interest and other financing income (expense), net | 787 | -146 | 392 | ||||||||||||||
Interest and other financing income (expense), net | 0 | 0 | 0 | ||||||||||||||
(Loss) income from continuing operations before income taxes | $787 | ($146) | $392 | ||||||||||||||
[1] | The information has been retroactively adjusted to account for the LCA business which is classified as held for sale as of December 31, 2014, as a discontinued operations. |
Business_Segment_and_Geographi2
Business Segment and Geographic Data, Revenue by Geographical Data (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||
Net revenues by geographic area [Abstract] | |||||||||||||||||
Revenues | $38,878 | $35,611 | [1] | $38,977 | [1] | $50,075 | $63,490 | $45,893 | $58,065 | $57,216 | $54,791 | $56,681 | $58,906 | $50,273 | $163,541 | $224,664 | $220,651 |
Long-lived assets by geographic area [Abstract] | |||||||||||||||||
Long-lived assets | 13,802 | 10,489 | 6,759 | 13,802 | 10,489 | 6,759 | |||||||||||
Reportable Geographical Components [Member] | North America [Member] | |||||||||||||||||
Net revenues by geographic area [Abstract] | |||||||||||||||||
Revenues | 123,161 | 174,850 | 163,973 | ||||||||||||||
Long-lived assets by geographic area [Abstract] | |||||||||||||||||
Long-lived assets | 12,385 | 9,119 | 5,772 | 12,385 | 9,119 | 5,772 | |||||||||||
Reportable Geographical Components [Member] | Asia Pacific [Member] | |||||||||||||||||
Net revenues by geographic area [Abstract] | |||||||||||||||||
Revenues | 9,870 | 19,081 | 28,031 | ||||||||||||||
Long-lived assets by geographic area [Abstract] | |||||||||||||||||
Long-lived assets | 286 | 0 | 0 | 286 | 0 | 0 | |||||||||||
Reportable Geographical Components [Member] | Europe (Including Israel) [Member] | |||||||||||||||||
Net revenues by geographic area [Abstract] | |||||||||||||||||
Revenues | 29,227 | 27,849 | 25,521 | ||||||||||||||
Long-lived assets by geographic area [Abstract] | |||||||||||||||||
Long-lived assets | 1,127 | 1,370 | 987 | 1,127 | 1,370 | 987 | |||||||||||
Reportable Geographical Components [Member] | South America [Member] | |||||||||||||||||
Net revenues by geographic area [Abstract] | |||||||||||||||||
Revenues | 1,283 | 2,884 | 3,126 | ||||||||||||||
Long-lived assets by geographic area [Abstract] | |||||||||||||||||
Long-lived assets | 4 | 0 | 0 | 4 | 0 | 0 | |||||||||||
Reportable Geographical Components [Member] | United States [Member] | |||||||||||||||||
Net revenues by geographic area [Abstract] | |||||||||||||||||
Revenues | 109,203 | 149,713 | 135,950 | ||||||||||||||
Reportable Geographical Components [Member] | Canada [Member] | |||||||||||||||||
Net revenues by geographic area [Abstract] | |||||||||||||||||
Revenues | 13,953 | 25,137 | 28,023 | ||||||||||||||
Reportable Geographical Components [Member] | Japan [Member] | |||||||||||||||||
Net revenues by geographic area [Abstract] | |||||||||||||||||
Revenues | $1,750 | $12,226 | $21,134 | ||||||||||||||
[1] | The information has been retroactively adjusted to account for the LCA business which is classified as held for sale as of December 31, 2014, as a discontinued operations. |
Quarterly_Financial_Data_Unaud2
Quarterly Financial Data (Unaudited) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||
Quarterly Financial Data (Unaudited) [Abstract] | |||||||||||||||||
Revenues | $38,878 | $35,611 | [1] | $38,977 | [1] | $50,075 | $63,490 | $45,893 | $58,065 | $57,216 | $54,791 | $56,681 | $58,906 | $50,273 | $163,541 | $224,664 | $220,651 |
Gross profit | 28,088 | 26,896 | [1] | 30,208 | [1] | 39,730 | 50,777 | 36,827 | 46,675 | 45,350 | 43,019 | 45,400 | 46,551 | 39,039 | 124,922 | 179,629 | 174,009 |
Net income (loss) | ($98,726) | ($14,943) | [1] | ($7,480) | [1] | ($345) | $3,185 | $886 | $7,094 | $7,212 | $5,894 | $7,525 | $4,213 | $4,857 | ($121,496) | $18,377 | $22,489 |
Net income (loss) per share [Abstract] | |||||||||||||||||
Basic (in dollars per share) | ($5.20) | ($0.80) | [1] | ($0.40) | [1] | ($0.02) | $0.16 | $0.04 | $0.34 | $0.35 | $0.28 | $0.35 | $0.20 | $0.26 | ($6.41) | $0.90 | $1.10 |
Diluted (in dollars per share) | ($5.20) | ($0.80) | [1] | ($0.40) | [1] | ($0.02) | $0.16 | $0.04 | $0.34 | $0.34 | $0.27 | $0.35 | $0.20 | $0.26 | ($6.41) | $0.89 | $1.08 |
Shares used in computing net income (loss) per share [Abstract] | |||||||||||||||||
Basic (in shares) | 19,041,451 | 18,724,419 | [1] | 18,723,484 | [1] | 18,719,419 | 19,400,341 | 19,982,967 | 20,573,048 | 20,678,023 | 20,947,985 | 21,205,675 | 20,547,244 | 18,339,977 | 18,940,355 | 20,454,970 | 20,355,520 |
Diluted (in shares) | 19,041,451 | 18,724,419 | [1] | 18,723,484 | [1] | 18,719,419 | 19,602,611 | 20,441,262 | 21,033,349 | 21,147,583 | 21,356,819 | 21,752,845 | 21,034,814 | 18,876,163 | 18,940,355 | 20,657,240 | 20,764,354 |
[1] | The information has been retroactively adjusted to account for the LCA business which is classified as held for sale as of December 31, 2014, as a discontinued operations. |
Valuation_and_Qualifying_Accou2
Valuation and Qualifying Accounts (Details) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Allowance for Doubtful Accounts [Member] | ||||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||||
Beginning Balance | $10,734 | $6,917 | $3,196 | |||
Cost and Expense | 7,661 | 5,958 | 4,629 | |||
Other Accounts | 0 | 0 | 0 | |||
Deductions | -4,836 | [1] | -2,141 | [1] | -908 | [1] |
Ending Balance | 13,559 | 10,734 | 6,917 | |||
Allowance for Sales Returns [Member] | ||||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||||
Beginning Balance | 16,046 | 11,901 | 6,143 | |||
Cost and Expense | 35,771 | 47,916 | 43,284 | |||
Other Accounts | 0 | 0 | 0 | |||
Deductions | -44,166 | [1] | -43,771 | [1] | -37,526 | [1] |
Ending Balance | $7,651 | $16,046 | $11,901 | |||
[1] | Represents write-offs of specific accounts receivable or actual returns, as applicable. |
Subsequent_Events_Details
Subsequent Events (Details) (LCA-Vision Inc [Member], USD $) | 0 Months Ended | ||
Jan. 31, 2015 | Dec. 31, 2014 | Feb. 02, 2015 | |
Subsequent Event [Line Items] | |||
Net proceeds realized from sale of business | $36,500,000 | ||
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Total purchase price | 40,000,000 | 40,000,000 | |
Net proceeds realized from sale of business | 36,500,000 | ||
Escrow deposit | 2,000,000 | ||
Working capital and indebtedness adjustments | 2,100,000 | ||
Collar amount under stock purchase agreement | $250,000 | ||
Period of agreement | 7 years | ||
Period of Transition Services Agreement | 60 days |